Consider the following cash flow statement for a property fully leased to a new tenant on a NNN basis beginning in Year 1. What is the Y1 Cash on Cash return or BTCF if the property was purchased for $7,000,000 and capital expenditures in Y1 totaled $25,000

			Year 1
Potential Base Rent			$500,000
Free Rent and Concessions			$0
Absorption and Turnover Vacancy			$0
Total Rental Revenue			$500,000
Expense Recoveries			$200,000
Total Tenant Revenue			$700,000
Other Revenues			$0
Potential gross Revenue			$700,000
Vacancy and Collection Loss			$0
Effective Gross Revenue			$700,000
Recoverable Opex			$200,000
NonRecoverable Opex			$100,000
Total Opex			$300,000
Net Operating Income			$400,000

Group of answer choices

5.7%%

5.4%

6.1%%

none of the choices are correct