1) Properties is acquiring an industrial property for $30M w/ the following data; loan at 60%, 5% interest rate, 30-year amortization, a holding period of three years, a proforma NOI of $1.95M with an inflation rate of 2.5%. If the discount rate is 10%, what is the IRR on the equity investment?
A) 10.00%. B) 14.54%. C) 23.56% D) 18.26%.
2) Using the data in question 1 above, what is the loan yield in year 2?
A) 9.50%. B) 5.00%. C) 11.10%. D) 10.83%