What Happens If NOI Drops 10%? Most real estate deals are underwritten around a base case. But investments don't operate in a spreadsheet. Income can fall. Expenses can rise. Occupancy can soften. Repairs can come sooner than expected. The question isn't whether the original assumptions look good. It's whether the deal still works when they don't. Consider a simple example: NOI: $1,000,000 Annual debt service: $700,000 DSCR: 1.43x Now reduce NOI by 10%. NOI falls to $900,000. Debt service doesn't change. But DSCR falls to 1.29x. That means less cash flow cushion and less flexibility to absorb another setback. And the more leverage you have, the smaller that margin for error becomes. This is why we don't look at leverage, DSCR, reserves, or NOI assumptions in isolation. We stress-test the business. What happens if occupancy drops? What happens if expenses are higher than projected? What happens if refinancing is more expensive? What happens if the business plan takes ...