# Pro Forma NOI > Pro Forma NOI means the anticipated net operating income from pre-existing and approved leases, subtracting projected operating expenses **Term:** Pro Forma NOI **Last updated:** 2026-07-29 ## Definition ## What Pro Forma NOI Means in a Contract Pro Forma NOI is a forward-looking calculation used in real estate and finance agreements to estimate the net income a property will generate over a future period. Unlike historical or trailing NOI, which reflects income already earned, pro forma NOI is built on assumptions about rent rolls, lease renewals, and expense trends that have not yet fully materialized. It combines income from pre-existing leases with income reasonably expected from leases that have been approved but not yet commenced. In a contract, this figure typically appears as a defined term that anchors financial covenants, valuation mechanics, or conditions precedent. Because it is projective rather than historical, the definition must specify exactly which leases, expense categories, and adjustments feed into the calculation, otherwise the parties may dispute the resulting number when it is later tested against actual performance. Pro Forma NOI is especially common in transactions involving