What is Weighted Average Lease Term (WALT)?
The average remaining lease term across all tenants in a property, weighted by each tenant's proportional share of total rental income or square footage.
Weighted Average Lease Term (WALT) in commercial lending practice
WALT is a key risk metric in CRE underwriting — a longer WALT indicates more stable, predictable cash flows, while a short WALT signals near-term rollover risk that could affect NOI and DSCR. Multifamily properties typically have low WALTs by definition; long-term net-leased single-tenant properties (e.g., investment-grade retail) can have WALTs of 10–20 years. Underwriters stress test NOI assuming rollover risk plays out in vacancy or rent roll-down scenarios.
Related terms
Related concepts in commercial underwriting
Rent Roll
A detailed schedule of all tenants in an income-producing property, listing tenant names, unit numbers, lease start and end dates, monthly rent amounts, security deposits, and any concessions.
Read definitionNOI (Net Operating Income)
Total property revenue minus operating expenses, excluding debt service, capital expenditures, depreciation, and income taxes.
Read definitionCRE (Commercial Real Estate)
Real property used for business purposes, including office, retail, industrial, multifamily (5+ units), and hospitality properties.
Read definitionDSCR (Debt Service Coverage Ratio)
The ratio of net operating income (or available cash flow) to total annual debt service, including principal and interest payments.
Read definitionSee it in Aloan
How Weighted Average Lease Term (WALT) shows up in AI underwriting
Aloan automates the underwriting analysis where weighted average lease term (walt) matters — spreading, global cash flow, credit memo generation — with source-cited audit trails on every figure. See it run on a real deal in your standardized format.
Ready to modernize your underwriting?
See Aloan run on your standardized real estate workflow.