b) A property has a projected Year 1 NOI of $200,000. NOI is projected to...
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b) A property has a projected Year 1 NOI of $200,000. NOI is projected to grow by 4% per year for the following 2 years, then by 2% per year for the subsequent 2 years and at a 1% constant rate afterward. Given a required return of 13%, what is the value of the property? If the required rate of return 13%, what the price of the property. (10p) c) A project with expected NOI of $500 000 next year. NOI grow at 3% thereafter, forever. If the required rate of return 13 % and a new building cost is $ 4 000 000, what is the value of land? (5p) d) A Mortgage loan of $60,00 with 12% Nominal Interest, 30 Years maturity, Monthly Payments and organization fees =3%.At the end year 5 the property is sold. What is the effective interest rate as a result of both the fees and the early loan repayment. (5p)
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