Property is generating 1.7 million in PGI (assume no vacancy) and NOI of 1 million. It is being bought based on a cap rate derived from question 6. The purchaser will obtain a mortgage of 65% of value. The interest rate will be 4.25% based on a 30 year amortization schedule.
1) What is the value?
2) What is the loan amount?
3) What is the Debt Yield?
4) What is the DSCR?
5) What is the break-even calculation
6) Band of investments: Given information above and the fact that equity returns are currently 8%, what cap rate would be derived from this information.