You make the down-payment of 2100000 you collect the noi of


Suppose you buy the property at the asking price of $7,000,000 and own it for exactly 1 year.

You make the down-payment of $2,100,000. You collect the NOI of $496,800. You make the annual mortgage payment of 306,250. In two years, the NOI is expected to be the same. You sell the property at the end of year 1, at a cap rate of 50 basis points below the cap rate of 7.10 and you pay off the loan balance when you sell. Compute the IRR on this investment.

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Financial Management: You make the down-payment of 2100000 you collect the noi of
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