Question: You are building a proforma for a potential acquisition and trying to estimate the sales price on the property at reversion. Year 1 NOI on

You are building a proforma for a potential acquisition and trying to estimate the sales price on the property at reversion. Year 1 NOI on the property is expected to be $500,000 with an annual growth rate of 3% thereafter. You will sell the property at the end of year 3. At that point, the terminal cap rate is expected to be 11%.

What is your estimated sales price on the property at reversion?

A. $4,966,941

B. $4,145,713

C. $5,002,345

D. $3,761,125

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