FOUR PART QUESTION RETAIL REIT wants to buy CORE SHOPPING CENTER from its current...
80.2K
Verified Solution
Link Copied!
Question
Finance
FOUR PART QUESTION
RETAIL REIT wants to buy CORE SHOPPING CENTER from its current owner and uses the cash flow projections to value the property. RETAIL REIT will pay $30,500,000 for the center and expects to sell it at the end of Year 10 for $36,000,000 with a 2% cost of sale. NOI growth is expected to be just over 2.0% (annualized) through the 10 years.
What is the expected IRR for RETAIL REIT?
6.77%
7.72%
8.14%
8.75%
If NOI growth is 1.9% through the analysis period, the impact to RETAIL REITs IRR will be?
Accretive
Dilutive
No Impact
If capitalization rates compress and RETAIL REIT sells the property for $37,000,000, the impact to RETAIL REITs IRR will be?
Accretive
Dilutive
No impact
If the Tenant Improvement expense in Year 2 is $120,000, the impact to RETAIL REITs IRR will be?
Accretive
Dilutive
No Impact
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
