Correctional KPIs.

Correctional and detention facilities are specialized single-purpose real estate leased or operated under government contracts (federal, state, local, or immigration), where cash flow is a per-diem rate times census under a contract term. Value is driven by contract counterparty credit, per-diem rate, occupancy/census guarantees, and remaining term — closer to a credit-lease / infrastructure profile than an operating asset. The sector carries concentration and political/ESG risk that must be underwritten explicitly. Ilora.ai ingests the government contract, census and per-diem reports, and the operating P&L, benchmarking per-diem, census, and contract-term coverage.

11 definitions · Sector: SPECIALTY · Used by Ilora.ai specialist AI agents

NOI

Net Operating Income

Total revenue minus operating expenses (excludes financing and capital costs). The primary measure of property-level profitability.

NOI = Revenue − Operating Expenses

  • profitability
  • core
Cap Rate

Capitalization Rate

Net Operating Income divided by current property value. Expresses unleveraged annual yield as a percentage.

Cap Rate = NOI ÷ Property Value

  • valuation
  • core
DSCR

Debt Service Coverage Ratio

Net Operating Income divided by total annual debt service. Lender-required cushion measure; below 1.0 means NOI cannot cover debt.

DSCR = NOI ÷ Annual Debt Service

  • lending
  • risk
LTV

Loan-to-Value

Loan amount divided by property value. Lower LTV = lower lender risk.

LTV = Loan Amount ÷ Property Value

  • lending
  • risk
OER

Operating Expense Ratio

Operating expenses divided by gross revenue. Lower is better, but varies by property type (hotels run higher than triple-net retail).

OER = Operating Expenses ÷ Gross Revenue

  • efficiency
GRM

Gross Rent Multiplier

Property value divided by gross annual rental income. Quick valuation shortcut; less precise than cap rate.

GRM = Property Value ÷ Gross Annual Rent

  • valuation
  • shortcut
IRR

Internal Rate of Return

Annualized return on investment accounting for time value of money across the full hold period.
  • return
  • underwriting
CoC

Cash-on-Cash Return

Pre-tax annual cash flow divided by total cash invested. Measures the cash yield, not total return.

CoC = Annual Cash Flow ÷ Total Cash Invested

  • return
DCF

Discounted Cash Flow

Valuation method that projects future cash flows and discounts them to present value at a chosen rate.
  • valuation
  • underwriting
TTM

Trailing Twelve Months

A rolling sum of the most recent 12 months. Smooths seasonality for KPI comparisons.
  • period
  • core
Rev PSF

Revenue Per Square Foot

Revenue per leasable square foot. Universal specialty-property comparable.
  • revenue

Industry reference

How the correctional sector operates.

Comparable public REITs / operators

  • GEO (The GEO Group)
  • CXW (CoreCivic)

Documents Ilora.ai ingests

  • Government contract
  • Census report
  • Per-diem billing report
  • Operating P&L
  • Occupancy-guarantee schedule

Frequently asked

Common questions about correctional.

How do correctional facilities generate real-estate cash flow?
Cash flow is a government per-diem rate multiplied by census (the number of detainees/inmates), under a contract with federal, state, local, or immigration agencies. Value keys on contract counterparty credit, per-diem rate, occupancy/census guarantees, and remaining term — underwritten like a credit lease, with explicit concentration and political/ESG risk.