Underwriting information:

$300$ unit apartment building

$1,500$ per month average rent

$7\%$ vacancy

$38\%$ total operating expense ratio

Replacement Reserves of $$250$ per unit per year

$3\%$ growth rate

Purchase price is $$50$ million

Exit cap rate is $6\mathrm{.}5\%$

Sales costs are $2\%$

Unlevered discount rate is $7\%$

Assume $5$ year holding period

Part $2-$ Assume the above but now with the following loan information:

Loan principal of $$30$ million

$5\%$ interest rate

$30$ year term with amortization

$2\%$ loan fees

Calculate levered cash flows

Calculate net sales proceeds after debt repayment

What are net loan proceeds?

What is monthly loan payment?

What is effective annual interest rate $($effective borrowing cost$)?$

What is your required equity investment if you buy the asset for $$50$ million?

What is your equity dividend rate?

What is the DSCR$?$

If the required return $($discount rate$)$ increases to $10\%,$ what is your NPV$?$ Levered IRR?