Purchase Price: $4,000000
Year 1 PGI: $600,000
PGI Growth Rate (Annual): 3%
Annual Vacancy and Collection Loss (VCL): 5%
Operating Expenses (OER): 35%
Terminal Capitalization Rate for Sales Price. 09 Capitalize NOI (Year 4)
Anticipated Holding Period: 3 Years
Maximum LTV: 70%
Interest Rate: 5%
Amortization Period: 30 Years
Payments Per Year: 12
Discount (Hurdle) Rate (Unleveraged & levered): 15%
1. What is the Unleveraged IRR and NPV?
2. What is the leveraged IRR and NPV?
3. What is the DCR for Years 1-3?
4. What is the NOI for Years 1-4?
5. What is the “Going In” (aka overall) Capitalization Rate?
6. What is the Cash on Cash (BTCF) for Years 1-3?
7. What is the Mortgage Constant?
8. Based on the NPV’s and IRR’s (unleveraged and leveraged, hurdle rates), do you recommend purchasing this property? Please explain. Get Finance Help Today