The last investment option for BIC is a run-down building on 1 acre of land called Crystal
Fantastic news! We've Found the answer you've been seeking!
Question:
The last investment option for BIC is a run-down building on 1 acre of land called Crystal Estates. They expect to rent the building as a storage facility, which will yield an NOI of $105,000 next year. Because of the wear on the building, BIC expects cash flows to decline at the rate of 1% per year indefinitely. BIC estimates it will earn a total return of 6.5%.
A) What is the NPV of this property in its current condition if the purchase price is $1.2M? (5 points)
Related Book For
Finite Mathematics and Its Applications
ISBN: 978-0134768632
12th edition
Authors: Larry J. Goldstein, David I. Schneider, Martha J. Siegel, Steven Hair
Posted Date: