What is the total payoff for the lp investor


Problem

Suppose a general partner (GP) invests 20% of the required $6,000,000 equity funding into a real estate development, with a limited partnership (LP) investing the rest. Assume that there is a promote of 25% in case the equity entity receives a return above 8% (hurdle). Assume that the equity entity receives a total payoff of $6,600,000 one year after the investment (10% return). What is the total payoff for the LP investor?

Request for Solution File

Ask an Expert for Answer!!
Financial Accounting: What is the total payoff for the lp investor
Reference No:- TGS03214688

Expected delivery within 24 Hours