Question: 08 (total points - 20) (Chapter 13 and 14) 1. (10 pts.) A developer is proposing to build and operate an 18-unit office building. Each

08 (total points - 20) (Chapter 13 and 14) 1. (10 pts.) A developer is proposing to build and operate an 18-unit office building. Each unit would rent for $5,750 per month. It is expected that vacancy would run at 6% and that the expenses would be 20%. The loan is to be 75% of the capitalized value. The developer has a MARR of 12%, the bank is charging 8% interest, and the Long Term Debt Service is a constant 8.5%. To assess the financial worth of this endeavor, determine the following (CAP rate to be exact, otherwise, round to the nearest cent or hundredth): a) CAP Rate: b) Capitalized value: c) Loan amount: d) Debt Service Coverage Ratio: e) Loan per unit

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