Suppose you buy the property at the asking price of $7,000,000 and own it for exactly 1 year.
You make the down-payment of $2,100,000. You collect the NOI of $496,800. You make the annual mortgage payment of 306,250. In two years, the NOI is expected to be the same. You sell the property at the end of year 1, at a cap rate of 50 basis points below the cap rate of 7.10 and you pay off the loan balance when you sell. Compute the IRR on this investment.