Using the NOI from Part $3$ and the Debt from Part $1$

$1$ What would the purchase price of the project be assuming a Going in or acquiring capitalization rate of $7\%$

$($assume Tenant $$2$ was known and the first $12$ months of income assumed as part of purchase price$)$

$2$ Calculate Internal Rate of Return to the investor based on a sale of the project at $12/31/26$

using a $6\mathrm{.}75\%$ Cap Rate as sale value and $2\%$ closing costs. Assume minimum $$10,000$ working capital at end of every year.

All other cash flow is Distributable to investor.

Explain the difference between Levered and Unlevered returns. Calculate both assuming you are the only inwestor.

What is the unlevered IRR and Multiple with all the other assumptions in a$2$ the same.

You may create a second version of the green tab labeled "investor Return Model" if desired.

$4$ Would you recommend this investment to someone if their alternatives were

potential Stock Market return $-14\%$

potential Corporate Bond investment $-11\%$

Investment in US Treasuries $-5\%$

Decsribe risk profiles of each

$5$ You Capitalized this project with an institutional partner who requires an $8\%$ return before sharing in any profits.

The institutional partner provided $90\%$ of the required equity and you provided the remainine $10\%$

a$.$ This type of joint venture is best organized legally by creating an entity known as$?$

b$.$ What is the institutional partners maximum exposure in the capital stack?

$[$i$.$e$.-$ how high in the stack is this partners "last dollar"$)$