Definition: EGI is potential gross income reduced by vacancy and collection losses, with other property income added if it was not already included.
Example
Potential rent is $120,000, vacancy and collection losses are $6,000, and separately stated laundry income is $3,000. EGI is $117,000.
Keep the distinction clear
EGI is calculated before operating expenses. Subtract those expenses to reach NOI. Keep all amounts in the same time period and avoid adding other income twice.
Related terms
Potential Gross Income (PGI) · Vacancy and Collection Losses · Net Operating Income (NOI)
Keep studying
Vacancy and Collection Loss: Calculate EGI and NOI
References: OCC archive: Income-property financial analysis
Pronunciation (US): ih-FEK-tiv GROHS IN-kum; EGI: ee-jee-EYE (capitals show stress)
Pronunciation reference: Merriam-Webster
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