ABC REIT is an active apartment REIT. Currently its net income expectation, after a $ 9 per
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Question:
ABC REIT is an active apartment REIT. Currently its net income expectation, after a $ per
share deduction for depreciation, is $ per share. ABC has no gains or losses from the sale
of real estate. For the location of ABCs holdings, apartments are selling at an average cap
rate of ABC has five hundred thousand shares outstanding with liabilities of $
million. REITs that are comparable to ABC currently have FFO multiples of At the end
of the next fiscal year, ABC expects to pay a dividend of $ per share and ABC expects this
dividend to increase by percent per year in the future. On a riskadjusted basis,
investors are requiring a return of percent for investments such as ABC. What is the price
per share using the Gordon dividend model?
Answer:
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