What is the answer?

Question 4 (15 marks) Jonathan Gallium must perform an investment analysis of a new income-producing office building for sale to a potential investor. Tomorrow, Jonathan will meet with Linda Germanium who is interested in acquiring the new building. Linda has accumulated a portfolio of office buildings worth $200 million. The asking price for the office building is $8 million. Rents are estimated at $1.7 million during the first year and are expected to grow at 3 percent per annum thereafter. Vacancies and collection losses are expected to be 11 percent of rents. Operating expenses (OPEX) will be 35 percent of effective gross income. A local bank offers a loan-to-value (LTV) of 75 percent on their loans. Linda could obtain a loan at 9 percent interest for 30 years with equal size monthly payments. Linda expects that the office building is going to appreciate 5 percent per year in value and she expects to own the building for five years and then sell it. The equity discount rate is 15 percent, and the reinvestment rate is 6 percent. A. What is Linda's debt service if she finances the office building with the available loan? (4 marks) B. What is Linda's expected before-tax internal rate of return on equity invested (BTIRR)? (5 marks) C. What is the debt coverage ratio in the first year? (3 marks) D. What is the terminal capitalization rate