Busi 331 Answer Guide 5 Lesson 5: Appraisal Of Income-Producing Properties

This study source was downloaded by 100000868590658 from CourseHero.com on 06-15-2023 01:03:07 GMT -05:00https://www.coursehero.com/file/69155019/Assignment-5-Anspdf/ UBC Real Estate Division 2019 BUSI 331 Answer Guide 5 LESSON 5: Appraisal of Income- Producing Properties and Valuation of Leasehold Interests 1. Answer: 4 Comparable A B C D GPI1 $390,000 $288,000 $356,000 $437,600 - Vacancy2 11,700 8,640 10,680 13,128 EGI $378,300 $279,360 $345,320 $424,472 - Operating Costs3 136,500 100,800 124,600 153,160 NOI $241,800 $178,560 $220,720 $271,312 Selling Price $3,900,000 $2,900,000 $3,500,000 $4,400,000 Capitalization Rate 6.20% 6.16% 6.31% 6.17% 1 GPI = (# of apts) (12 months) (monthly rent) + (parking income) 2 Vacancy = vacancy rate GPI 3 Operating Costs = 0.3 5 GPI The market -determined capitalization rate is an average of the capitalization rates for the four comparables (given that there is no further information in t he question to distinguish between the comparables) . 6.20%Market Capit 6.16%alization R 6.31ate 6.2% 6.1%7%14+=++====2. = Answer: 1 == =NOIValueCapitalization Rate$230, 000 6. $3, 703, 704, rounded to $3, 7021 00% , 00== ===3. = Answer: 1 ==R5 = $45,000 (1 + 0.05)4 = $54,698 R10 = $45,000 (1 + 0.05)9 = $69,810 R20 = $45,000 (1 + 0.05)19 = $113,713 4. Answer: 3 NOIV