Instacart Inc. needs 30,000 square feet of usable office space. There’s an office building in prime location in Inland Empire that has exactly the square footage it needs located on its top floor. The top floor has 100,000 square feet of rentable space, of which 50,000 square feet is currently used by other tenants. The rent that the landlord is charging is $8 per square foot per year. (a) If Instacart is UNAWARE of any areas that are shared (a.k.a. common) by the tenants on the top floor (such as hallways, restrooms, lounge areas), it would expect to pay rent on ____ square feet of space which would result in ____ in total annual rent due. (b) Now, assume that Istacart IS AWARE of common areas on the top floor. It is also aware that in this case the landlord would be charging all the tenants on the floor their prorated share of rent for those areas. In this case, Instacart would expect to pay rent on ____ square feet of space which would result in ____ in total annual rent due.

Kmu

Estimate the market value of the following small office building. The property has 10, 500 square foot of leasable space that was leased to a single tenant on January 1, four years ago. Terms of the lease call for rent payments of $9, 525 per month for the first five years, and rent payments of $11, 325 per month for the next five years. The tenant must pay all operating expenses. During the remaining term of the lease, there will be no vacancy and collection losses; however, upon termination of the lease it is expected that the property will be vacant for three months. When the property is released under short-term leases, with new tenants paying all operating expenses, a vacancy and collection loss allowance of 8 percent per year is anticipated. The current market rental for properties of this type is $11 per square foot when tenants pay all operating expenses, and this rate has been increasing at a rate of 3 percent per year. The market discount rate for similar properties is about…

The ABD Company began operations several years ago. The company purchased a building and, since only half of the space was needed for operations, the remaining space was rented to another firm for rental revenue of PhP1,000,000 per year. The success of ABD Company's product resulted in the company needing more space. The renter's lease will expire next month and ABD will not renew the lease in order to use the space to expand operations and meet demand. The company's product requires materials that cost PhP1,250 per unit. The company employs a production supervisor whose salary is PhP100,000 per month. Production line workers are paid PHP750 per hour to manufacture and assemble the product. The company rents the equipment needed to produce the product at a rental cost of PhP75,000 per month. Additional equipment will be needed as production expanded and the monthly rental charge for this equipment will be PhP45,000 per month. The building is depreciation on the straight-line basis at…

Rakesh

Given the following scenario- Office building, 3 stories, 3000 square feet (SF) gross interior floor space each, 2 tenants per floor, 1 350 sf of the building is used for hallways, common bathrooms, stairs, elevator, and lobby.  The owner wants a gross rent of $135,000 per year.      (First, establish the Load Factor) What is the rent that the Owner should charge per square foot?  If Tenant Z rents 1200 sf of usable area, what will be his monthly rent? If the building has an operating expense ratio of 28% of gross rents, including vacancy and reserves, what is the Net Operating Income?   The sale price at a 9% CAP rate?

Pearl Inc. sells storage structures of various sizes to homeowners and businesses.Respond to the requirements related to the following independent revenue arrangements for Pearl products and services.   Pearl offers building R400, mainly to homeowners. Pearl will also install the building for the customer. The price for Pearl to deliver and install an R400 is $ 5,500. On a standalone basis, the building sells for $ 5,300 (cost $ 3,400), and Pearl estimates that the standalone selling price of the installation service (based on cost-plus estimation) is $ 500. (The selling of the building and the installation services are considered two performance obligations.) Pearl signed 15 contracts to deliver and install R400s on April 5, 2017. Customers paid the contract price in cash. The buildings were delivered and installed during May 2017. Prepare journal entries for Pearl for R400 in April and May 2017. (Round intermediate calculations to 6 decimal places, e.g. 1.246871 and final answers to…

Due to a cool spring season, Petra’s pool installation business has not had the sales she anticipated. To generate new business, Petra has decided to offer a deferred payment plan. A customer is interested in a pool installation worth $42,800. If Petra structures the contract to require a $5,000 down payment, followed by 24 equal monthly payments with the first payment due in 6 months from now, how much should those payments be if Petra’s cost of capital is 4.8% compounded monthly?