The attached set-up sheet provides the needed Base Year and
First Year data, as well as the Holding Period Assumptions.
PURCHASE PRICE:	24,000,000.00
TERMS:	$4,000,000 Down Payment, the balance financed at 8 3/4% with a
	25-year level payment, monthly amortization mortgage
BASE YEAR DATA (2013):
	REVENUE
	Rental Income			$ 2,743,000
	OPERATING EXPENSES
	Real Estate Taxes		$137,150
	Labor Costs			$327,788
	HVAC			$181,062
	Repairs & Maintenance		$175,000
	Hazard Insurance			$72,000
	Total			$893,000
	NET OPERATING INCOME	$ 1,850,000
ASSUMPTIONS (for the HOLDING PERIOD)
Purchase Date:			December 31, 2013
Rental Income:			Increase 5.0% per year
Operating Expenses (ALL Except for Real Estate Taxes and Labor Costs):			Increase 4.0% per annum
Real Estate Taxes:			For 2014- 2019, use 2013 Base Year Real Estate Taxes expense and grow it by 3% per year
Real Estate Taxes Escalation Income:			(Overage Only) For each year 2014-2019, calculate the difference between each year of Real Estate Tax Expense minus the previous year of Real Estate Tax Expense
Labor Costs Taxes:			For 2014- 2019, use 2013 Base Year Labor Costs expense and grow it by 3% per year
Real Estate Taxes Escalation Income:			(Overage only) For each year 2014-2019, calculate the difference between each year of Labor Costs Expense minus the previous year of Real Estate Tax Expense
Depreciable Basis:			80% of the Purchase Price.
Land:			Land Does not get depreciated
Sales Date:			December 31, 2018 (Sales Proceeds are received 12/31/18)
Sales Cap Rate:			9.5% (Using 2019 NOI)
Selling Costs:			8.0% of Selling Price (Includes Commissions)
Tax Rate:			39.6%	(USE THIS RATE FOR THIS CASE) Do not use any tax tables. Only use the information given here.
Long Term Capital Gains Tax Rate:			20.0%	(USE THIS RATE FOR THIS CASE)
Depreciation Recapture Tax Rate :			25.0%	(USE THIS RATE FOR THIS CASE)
Depreciation years			39
NOTES/HINTS
	* In any operational years where a "Taxable Loss" is encountered, the calculation for the TAX (now called TAX SAVINGS) should be treated as a TAX REFUND, and "taken in" during the same tax year as the loss.
	* If you perform your analysis correctly, you should encounter taxable losses for 2 years of your investment period.
	* For Escalations, start with the same base amount for the revenue and expense calculations, and then grow those by the given assumptions.
	* Land does not get depreciated
	* When calculating Taxes only use the assumptions given here. Do not use any information based off any tax tables
	Answer the following questions and show calculations:
	1. Please build a proforma sheet in excel format for years 2013-2018?
	a. What is the Net Sale Price in 2018?
	b. What is the Before-Tax Cash Flow (BTCF) in 2014?
	c. What is the After-Tax Cash Flow (ATCF) in 2014?
	d. What is the Margin of Safety (excluding any sale dollars) in 2018?
	e. What is the Cash on Cash Return (After-Tax) in 2014-2018?
	f. What is the Net After-Tax Sales Proceeds?
	g. What is the Pre-Tax IRR for this investment (both Leveraged and Unlevered)?
	h. What is the After-Tax IRR for this investment (both Leveraged and Unlevered)?
	i. What is the NPV of this investment using a 12% discount rate (before tax)?
	j. What is the NPV of this investment using a 12% discount rate (after tax)?
	k. Should you purchase this asset? Why or why not?
2. Please show calculations for each answer from a-f
3. Please provide rental escalations calculations for years 2013-2019.
4. Please show Sales Calculations.