Cash flow answers a simple question: after operating expenses and debt service, how much money is left? It's the number most owners track, because it's the number that shows up in the bank account.
Return on equity answers a different question: given how much of your net worth is tied up in this property today, what rate of return is that capital earning? A property purchased decades ago may have appreciated dramatically while rents grew more slowly. The result is a large equity position producing a comparatively small percentage return.
Here's a hypothetical illustration only: a property with $2,000,000 of equity producing $30,000 of annual net income represents a 1.5% return on equity. The cash flow is positive. The return on the capital is modest.
Neither number is a verdict. Return on equity ignores appreciation, principal reduction, tax treatment and everything you value that isn't financial. But it turns an abstract feeling — 'I think this property is fine' — into a baseline you can actually compare against alternatives.