What is Gross Potential Rent (GPR) vs. Effective Gross Income (EGI)?

• A. GPR is the total rent if fully leased at market rates; EGI accounts for vacancies and other income adjustments
• B. GPR is the actual collected rent; EGI is the gross potential
• C. EGI equals GPR minus vacancies
• D. EGI is the rent after applying concessions

Answer: (A)

GPR represents the maximum revenue the property could generate if every unit were rented at current market rates, with no vacancies. It sets the top line for potential rent. EGI, on the other hand, reflects what the property actually brings in after real-world adjustments: vacancy and credit losses reduce income, while other income from sources like parking, laundry, or vending adds to it. So EGI = GPR minus vacancy and credit losses plus other income.

This matches the idea that GPR is the total rent if fully leased at market rates, while EGI accounts for vacancies and other income adjustments. The other statements mix up these concepts or omit factors like additional income or concessions.