Question: I need complete solutions with all steps for q1 and q2 Development Case: Developer X is considering a development opportunity in Bnaid AI-Qar residential district

 I need complete solutions with all steps for q1 and q2

I need complete solutions with all steps for q1 and q2

Development Case: Developer X is considering a development opportunity in Bnaid AI-Qar residential district In Kuwait City. (Attached figure) Plot No. 7 and Plot No. 24 are on the market for sale and plots are 1000m2 in this area. Plot 1 has been sold for 1,200,000KD a year ago. The market is starting to pick up after a3 year decline in values and showing 510% increase. Construction activity is active and contractors are hungry for work. Class "B" construction cost is averaging at 200KD/m2. And parking construction is at 100KD/m2. Banks are having some abitite with RE lending. And they are allowing 50/50 Borrowing ratio at 6% cost. Banks are allowing 2 year principal repayment grace period therefore loan principal repayment starts from year 3 with 5 equal annual payments ( 20% every year). Development soft cost are running at 10% of construction cost, Which includes AE fres, legal and other. Total development duration is estimated to be 36 months including design and permit. Accordning to the municipality Building Code for the ares is: - Net BUA: 250% - Parking req: 1 Parking/Apt. - Parking dimension: - 6mX3.5m. - Parking allowed in basement and ground. Average rental rate in the area is 6-7 KD/m2, Developer X believes that building can be fully leased within the first year. Rates are expected to increase by 20% every 5 years. And the capitalization rate at the end of year 13 is estimated at 6%. Maintenince and property management fees are estimated at 5% of rental income. Q1: Completo the attuched cash flow sheet, highlighting the following: 1. Cost of Plot 7 Or 24 . 2. Total Build up area? 3. Total construction cost? 4. Maximum amount can be borrowed? 5. Annual interest expense? 6. Annual Renr? 7. Annual maintenance expensc? Q2: What is the Balance sheet and lncome statement for year 6 for the owner of the buitding

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