Returns should be risk-adjusted based on a variety of metrics: initial cap rate, cash flow, IRR ratio, leverage & terminal cap rate among them. A good starting point is to measure yield against the safest CRE derivatives – AAA CMBS with 30% subordination. For example, if current yield in discounted bonds is 7%, and yield to maturity is projected to be 14%, then cash distributions in CRE ought to start in the range of 10% and leveraged IRR ought to be not less than 20%. Project returns vary with the financial markets. The best way to insure a favorable risk-adjusted return is to develop a comprehensive understanding of the pricing of various CRE derivatives.