Ahenfie is an upcoming 50-unit apartment project that seeks to provide affordable urban living in the city of Accra. The project consists of 30-units 2-bedrooms and 20-units 3-bedrooms, at a cost of GHS6,000,000 and GHS5,000,000 respectively to develop, including land cost. The project is expected to reduce the housing deficit of 1.7million in Ghana. The choice of 2 and 3-bedroom units is informed by the PropTalks Magazine published in 2019 by Property Strategy & Analytics LLC and the 2010 Housing and Population Census.

The investor-developer, MeTis Brokers, seeks to hold the project as an investment for 20 years after completion, during which the apartments will be rented out at GHS800 and GHS1,300 per month (full rental value) for 2-bedrooms and 3-bedrooms respectively, based on market analysis. All the 50-units will be sold to the existing tenants or to an investor on the 21st year. MeTis Brokers expects 25% return on their GHS1,500,000 equity investment in this project.

MeTis Brokers plans to leverage its equity to raise the remaining funds from any of the mortgage finance institutions in Ghana.

In addition to an interview for the position of Property Finance and Investment Analyst at Databank, the leading investment bank in Ghana, you are required to produce three separate and analytical business-styled reports on this project, reflecting your advice on:

1. The viability of the project to the investor-developer
2. The viability of the project to the mortgage lender  and factors the lender should examine in considering a loan application from MeTis Brokers; and

3. the most appropriate way to finance this development project.

Answer rating: 100% (QA)

Answer and step by step explanation 1 The Viability of the Project to the InvestorDeveloper To determine the viability of the project to the investordeveloper one must consider the cash flow associate... View the full answer