Definition: A financial statement based on assumptions or projections rather than solely on actual historical results. In property investing, it often forecasts rental income, expenses, and operating results.
Example
An investor projects next year's rent and vacancy to estimate a building's net operating income.
Keep the distinction clear
Label projections clearly and examine the assumptions. A pro forma is not proof that the property has already earned the forecast income.
Related terms
Income Statement · Net Operating Income (NOI) · Vacancy and Collection Losses
Keep studying
Income Approach: NOI, Cap Rate, Property Value, and Cash-on-Cash Return
References: FREC Course II syllabus: investment concepts
Pronunciation (US): proh FOR-muh STATE-ment (capitals show stress)
Pronunciation reference: Merriam-Webster
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