You are considering purchasing a small office building for $2,475,000. The expected first - year potential gross income

[answerhappygod]

You Are Considering Purchasing A Small Office Building For 2 475 000 The Expected First Year Potential Gross Income 1 (66.86 KiB) Viewed 32 times

You are considering purchasing a small office building for $2,475,000. The expected first - year potential gross income is $540,000 with a vacancy loss equal to 15 % of the PGI . Operating expenses and Capital expenditures are expected to be 40 % and 5 % of the EGI respectively. The mortgage on the property is 75 % LTV at a 6 % interest rate with a 20 - year term with monthly compounding. A. What is the required equity investment ( what is the required down payment)? (3 points ) B. Estimate NOI , the debt service paid in a year and the Before Tax Cash Flow . (6 points)