What is the estimated residual value of the land under

Assignment Help Financial Management

Reference no: EM131063276

An appraiser is estimating the highest and best use of a vacant site. One of the alternatives being considered as a use for the site is a building that would cost $1 million to construct the improvements. Under this use, NOI is estimated to be $120,000 per year. Assume that an appropriate building capitalization rate (RB) is 10 percent and an appropriate land capitalization rate is 8 percent. What is the estimated residual value of the land under this use? What is the total property value?

Reference no: EM131063276

Questions Cloud

Types of goals are important to strategy of organization : Explain why the 3 types of goals are important to the strategy of an organization. Explain why the different types of planning are important to the strategy of an organization. Examine the elements or factors involved in creating an effective strateg..

NOI will be level but the property value will increase : A property is expected to have NOI of $100,000 during the first year. Using a 10 percent yield rate (YO) and a five-year holding period, estimate the value under the following assumptions: a. NOI will be level but the property value will increase by ..

Describe the symptoms of eating disorder anorexia nervosa : Describe the symptoms of the eating disorder Anorexia Nervosa with the reference to the psychological changes that occur in the human brain. How do these psychological changes affect a person's self-perception

Planning and development into a new venture : How can a market analysis provide the concrete data required to steer planning and development into a new venture? If you were the CEO of a healthcare facility of your choice, what aspects of a recent market analysis would you use to pursue a comp..

What is the estimated residual value of the land under : An appraiser is estimating the highest and best use of a vacant site. One of the alternatives being considered as a use for the site is a building that would cost $1 million to construct the improvements. Under this use, NOI is estimated to be $120,0..

Mission of business firms : During the early 1900s, the mission of business firms was set exclusively in economic terms. After the 1960s, social activists began to question the singular objective of business enterprises.

What is the profitability index for each project : What is the payback period for each project? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).) Payback period Project A years Project B years. What is the profitability index for each project? What is the..

Production planning area of many organizations : The Gantt Chart was invented by Henry L. Gantt. It is still used today in the production planning area of many organizations. It was the first simple visual device to maintain production control. The chart visually shows when tasks are supposed to..

Management-consulting firm : Consider a management-consulting firm. Each job undertaken may differ depending on the needs of the client, requiring the firm to develop a different service for each client. The production system most likely used in this situation would be:

User Account

All Pages