What is the taxable income?

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1. A 1,500-square-foot office space is leased at $12.00 square foot. The space is vacant one month out of the year. Office expenses are $6.50 per square foot and an expense stop is set at $6.00 per square foot. What is the annual net operating income? (Assume no additional expenses during the month of vacancy)02_08_2022_QC_CS-295372
$7,500
$6,750
$15,750
$8,250
2. A 1,000-square-foot office space is leased at $15.00 per square foot during the first year with $2.00 step-up provisions each of the following years. The lease is gross with an expense stop set at $6.65 per square foot, and yearly expenses per square foot are as follows: $6.00, $6.65, and $7.05. The lease provides for two months of free rent at the end of the lease term. If the lease term is three years and the discount rate is 10 percent, what is the effective rent per square foot?
$9.38
$9.50
$10.22
$10.46
3. A property produces an after-tax internal rate of return of 12.24 percent. If the investor has a marginal tax rate of 31 percent, what is the before-tax equivalent yield?
8.45%
11.39%
16.03%
17.74%
4. A property that produces an annual NOI of $100,000 was purchased for $1,200,000. Debt service for the year was $95,000 of which $93,400 was interest and the remainder was principal. Annual depreciation is $38,095. What is the taxable income?
$5,000
$6,600
−$31,495
−$33,095
5. A property that produces a level of NOI of $200,000 per year is expected to be sold in Year 5 for $2,000,000. If the property was purchased for $2,000,000, what percent of the IRR can be attributed to the operating income only?
10.0%
90.0%
37.9%
63.1%
6.A property that produces a first year NOI of $80,000 is purchased for $750,000. The NOI is expected to increase by 15 percent in the sixth year when some of the leases turn over. The resale price in Year 10 is expected to be $830,000. What is the net present value of the property based on the 10-year holding period and a discount rate of 9.5 percent?
$87,433
$87,221
$95,294
$116,490
7. A property is financed with an 85 percent loan-to-value ratio at 10 percent interest over 25 years. What would be the estimated BTIRRE on equity given that the BTIRRp is 10.75 percent?
10.1%
10.4%
15.0%
13.2%
8. If the renewal probability for a lease is assumed to be 60 percent and the number of months vacant would be 12 months if the lease is not renewed, what is the expected vacancy at the end of the lease?
4.8 months
7.2 months
9.0 months
12.0 months
9. An investor is analyzing the risk of a possible investment by producing three different scenarios. Under a pessimistic scenario, the property would produce a BTIRRp of 8 percent; a most-likely scenario would produce a BTIRRp of 12 percent; and an optimistic scenario would produce a BTIRRp of 16 percent. The investor assigns the pessimistic scenario a 25 percent chance of occurring, the most-likely case a 60 percent chance of occurring, and the optimistic scenario a 15 percent chance of occurring. What is the standard deviation of the returns?
0.062%
1.248%
2.498%
2.904%
10. Each parcel of land in a new development is selling for $15,000 and the total project revenue is estimated to be $5,000,000. The project lender has stated that the loan should be paid off when 80 percent of the total project revenue has been earned. The total loan amount is $3,500,000. What is the release price for each parcel?
$8,400
$12,000
$12,750
$13,125
11. A REIT has an NOI of $15 per share and currently pays a dividend of $10 per share. The dividend is projected to increase by 4 percent by next year and continue to increase by 4 percent per year thereafter. Assuming that the blended cap rate is 9.75 percent and the required rate of return is 10.5 percent, what would be the net asset value (NAV) of the REIT?
$60.15
$71.89
$153.85
$160.00
12. A REIT has an NOI of $15 per share and currently pays a dividend of $10 per share. The dividend is projected to increase by 4 percent by next year and continue to increase by 4 percent per year thereafter. Assuming that the blended cap rate is 9.75 percent and the required rate of return is 10.5 percent, what value would the Gordon dividend discount model provide?
$60.15
$71.89
$153.85
$160.00
13. A property is leased for $24,000 per year although market rents are currently $27,500 per year and are expected to increase by 2 percent per year. The property is expected to be sold at the end of Year 10 based on a 10 percent terminal cap rate applied to the eleventh year NOI. The current lease on the property will expire at the end of Year 10 so the property can be leased in the eleventh year at market rates. What is the value of the leased fee estate based on an 11.5 percent discount rate?
$362,489
$298,325
$251,298
$271,486

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