Table 1 provides information regarding a building that is being appraised. The holding period for the building is 2 years. What is your estimate of the building’s value if you apply the following weights during reconciliation: 35% for the sales comparison approach, 10% for the cost approach, 30% for the direct capitalization approach, and 25% for the DCF approach? Round your answer to the nearest dollar and write it in the box.

Table 1

Item	Note
Net operating income in year 1	$285,000
Net operating income in year 2	$325,000
Net operating income in year 3	$450,000
Net proceeds from selling building in year 2	$1,800,000
Required return	12.90%
Going-in cap rate	16.00%
Going-out cap rate	25.00%
Estimated value based on sales comparison approach	$1,680,000
Estimated value based on cost approach	$1,620,000

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To estimate the buildings value using the weighted reconciliation approach well apply th... View the full answer