What's the difference between direct capitalisation and discounted cash flows approach of valuing a private real estate?

CFA Level II
#1

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#2

Direct cap used when we have constant NOI, in whicj case value= NoI/(r-g).

If we have expect different NOI each year, we will use disc cash flow method, discounting NOI for certain period and then calculating terminal value, just like two stage DDM

Hope this helps