Question $4(6$ points$)$

You own a $48,000SF$ office building with current NOI of $$11\mathrm{.}95$ per $SF$ per year. You are refinancing the property, and the current market indicates a $9\mathrm{.}25\%$ cap rate. The appraisal your lender obtained indicated a value based on this NOI and cap rate.

Your lender has quoted you the following terms:

$8\mathrm{.}75\%$ interest rate

$20-$year amortization

Monthly compounding

$65\%$ LTV ratio

$1\mathrm{.}40$x debt coverage ratio

Prepayment penalty equal to $3\%$ of loan balance at time of prepayment

Determine the following:

$4$a$.$ The value indicated in the lender's appraisal.

$4$b$.$ The maximum amount for the loan based on the LTV ratio.

$4$c$.$ The maximum amount for the loan based on maximum ADS indicated by the debt coverage ratio.

$4$d$.$ The annual debt service for the lower of the loan amounts from $4b$ and $4c.$

$4$e$.$ The loan balance at the end of year $8.$

$4$f$.$ The prepayment penalty if the loan is prepaid at the end of year $8.$

Your answer: