Construct an Excel Spreadsheet to calculate the following:

Given the following historical information from the current

owner, prepare a reconstructed operating statement to

obtain an estimate of $1^{st}$ year $($next $12$ months$)$ NOI for

the property.

The building consists of $10$ units that could rent for $$550$

per month each. Assume: vacancy & collection losses will

be $5\%$ of potential gross income; the CAPX reserve will be

included "above line"; increase current operating expenses

in same ratio as potential gross income increases.

Using a $7\%$ cap rate, what is the value of this property

utilizing the income approach?

Rental income $($last year$)$

Less: Operating & capital expenses

Prepare a discounted cash flow in Excel using the same figures for year one. For years

$2-6,$ the following will apply:

a$.$ Rental rates will increase by $3\%$ per year.

b$.$ Operating expenses will increase by $2\%$ per year with the exception of power and

heat which will increase by $3\%$ per year. Disregard the reserve for capital

expenditures in your calculations.

c$.$ The terminal cap rate is $6\%.$