Cash Available For Distribution - CAD

There's always a long line when there's cash available for distribution. But don't get your hopes up. We're talking about something else here.

In this context, CAD refers to cash available to be given out as dividends in a Real Estate Investment Trust (REIT). This type of trust consists of a group of investors who purchase and manage income-producing real estate, such as office buildings and shopping malls. The trust calculates the amount of cash available by subtracting recurring capital expenses, such as roof replacement or heating and cooling system repairs, from income generated from operations, such as rent and depreciation.

The CAD is an important number that investors use to assess the financial health of a REIT. The analog is the payout ratio for a given stock's dividend. When there's a lot of cash available for distribution, it means the company is Michael Phelps Beijing 2008 Healthy. If there's not a lot, we're talking Walter White First Season of Breaking Bad Unhealthy.