Question $3(8$ points$)$

You have recently purchased a $90-$unit apartment building with year $1$NOI of $$8,400$ per unit per year. You purchased the property based on a $7\mathrm{.}50\%$ cap rate. The appraisal your lender obtained indicated a value of $$10,000,000.$

Your lender has quoted you the following terms:

$6\mathrm{.}85\%$ interest rate

$30-$year amortization

Monthly compounding

$65\%$ LTV ratio

Determine the following:

$3$a$.$ The purchase price you are paying based on the year $1$NOI and cap rate given.

$3$b$.$ The principal amount for the loan $($max loan amount based on LTV$).$

$3$c$.$ The equity contribution$/$down payment for the purchase.

$3$d$.$ The annual debt service for the loan

$3$e$.$ The debt coverage ratio based on the year $1$NOI.

$3$f$.$ The debt yield based on the year $1$ NOI.

$3g.$ The before$-$tax cash flow for year $1.$

$3h.$ The equity dividend rate for year $1.$

Your answer: