How is Return on Investment (ROI) different from Net Operating Income (NOI)?

Although they’re often discussed together, ROI and NOI measure different things. Net Operating Income (NOI) focuses on how a property performs by comparing its income to its operating expenses. Return on Investment (ROI) looks more broadly at how well your overall investment is performing based on the money you’ve invested.

Investors often use several financial measurements—including NOI, cap rate, cash flow, and ROI—to evaluate commercial properties rather than relying on a single number.

If you’re comparing investment opportunities, I’d be happy to explain these concepts in straightforward terms and discuss how they work together.