Suppose that you are attempting to value an income-producing property using the direct capitalization approach. Using data from comparable properties, you have determined the overall capitalization rate to be 7.0%, a reasonable discount rate of 9%, and an exit cap rate of 12%. If the projected first-year net operating income (NOI) for the subject property is $135,500, If the projected second-year net operating income (NOI) for the subject property is $145,500, and the projected final- year total cash flow for the subject property is $1,155,500 what is the indicated value of the subject using direct capitalization? Enter the answer below as an absolute value (a positive number), no dollar sign. Rounding to the nearest whole number (no decimal places) is ok. Your Answer:

Suppose that you are attempting to value an income-producing property using the direct capitalization approach. Using data from comparable properties, you have determined the overall capitalization rate to be 7.0%, a reasonable discount rate of 9%, and an exit cap rate of 12%. If the projected first-year net operating income (NOI) for the subject property is $135,500, If the projected second-year net operating income (NOI) for the subject property is $145,500, and the projected final- year total cash flow for the subject property is $1,155,500 what is the indicated value of the subject using direct capitalization? Enter the answer below as an absolute value (a positive number), no dollar sign. Rounding to the nearest whole number (no decimal places) is ok. Your Answer:

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 13P

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