6. Assume a retail shopping center can be purchased for $6.0 million. The center's first year NOI is expected to be $489,500. A $45,000,000 loan has been requested. The loan carries a 4.0 percent fixed contract rate, amortized monthly over 25 years with a seven- year term. What will be the property's (annual) debt coverage ratio in the first year of operations? a. 1.546. b. 0.098. c. 18.547. d. 0.063.

6. Assume a retail shopping center can be purchased for $6.0 million. The center's first year NOI is expected to be $489,500. A $45,000,000 loan has been requested. The loan carries a 4.0 percent fixed contract rate, amortized monthly over 25 years with a seven- year term. What will be the property's (annual) debt coverage ratio in the first year of operations? a. 1.546. b. 0.098. c. 18.547. d. 0.063.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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4
A real estate company wants to borrow $6.5 million to in a project. The interest rate for the borrowing is 12% in APR compounded quarterly. The first payment will be made at the end of the first quarter after borrowing. If the real estate company wants to pay back a fixed amount of money per quarter for 15 years, what is the quarterly repayment for the real estate company? (with calculations)
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