C D E F G H 9 9 K O O R 8 U 10 You are a Real Estate developer building a small office tower in Montreal. The construction will take one year and the units have all been pre-leased. The stabilized NOI at opening will be $750,000 and comparable cap rates are 6%. 12 The construction lender is willing to finance the project based on the terms and conditions shown below. a) Based on the budget, calculate the oustanding construction loan at the end of the year. b) How much equity will you be able to withdraw at the end of the construction period if you take-out a mortgage with the terms and consitions shown below? 18 14 15 16 Please make your calculations to the "right of the data and rent roll" on this worksheet. 17 Upload your file onto Moodle by the deadline indicated on the course outline. 16 19 Grade (out of 10): 20 + 21 22 Development Budget: 23 24 Land 2.000.000 25 Site preparation 250,000 25 Hard costs 8,000,000 27 Professional fees 300,000 2a Permits 77,000 29 Project management 150.000 30 Lesing commissions 16.000 31 Other soft costs 195,000 32 10,988,000 33 Interest 109,000 34 TOTAL 11,097,000 35 BE 37 Cash flow: 2e 39 The land is purchased and site preparation 40 occur in the first month. The soft cost 41 (excluding interest) are evenly distributed 42 over the 12 month period. The hard costs 43 are evenly dirtibuted over month 3 to 44 month 12. All cash flows occur at the end 45 of the month 46 47 48 49 Construction loan: 30 51 LTC 65.0% 52 Interest rate 5.0% 58 54 GS Stabilized NOI at openi 750.000 56 Comparable cap rates 8.0% 57 58 56 Mortgage loan: 60 61 Term (years) 5 E2 Amortization period (ye 20 es Mortgage rate 4.0% 54 Maximum LTV 75,0% GG Minimum DSOR 1.25 66