Real estate investment and finance
In order to make a sound investment decision, you need to:
1)Determine Potential Gross Income and Vacancy Allowance for the MUL based on the information for comparable properties.
2)Reconstruct a proper operating statement to determine the Net Operating Income.
3)Build a 10-year Pro Forma forecast using proper financial modelling standards
4)Determine the maximum bid price for the MUL, considering 12% of the sale price as transaction cost and taxes,and based on the NPV evaluation of the unlevered cash flows. As a cautiously optimistic investor and considering the economic climate,instead of using the mean NPV, you are willing to acceptance 25% risk level.
What would be your bid price for the MUL?
