A 72,000 square foot multi-tenant retail property with an Equinox gym and a Wendy’s restaurant in Columbus, Ohio was recently sold for $7,200,000. Selling costs, including a brokerage fee, totaled five percent of the purchase price. The mortgage loan balance at the time of sale was $3,760,000. The property was purchased eight years earlier for $4,200,000, and annual depreciation deductions of $120,000 were taken each year for tax purposes. If the combined effective federal and state income tax rates on capital gains and tax depreciation recapture is 30%, what was the after-tax cash flow from the sale of the property? a. $2,288,000 b. $2,252,000 c. $2,540,000 d. $2,000,000

A 72,000 square foot multi-tenant retail property with an Equinox gym and a Wendy’s restaurant in Columbus, Ohio was recently sold for $7,200,000. Selling costs, including a brokerage fee, totaled five percent of the purchase price. The mortgage loan balance at the time of sale was $3,760,000. The property was purchased eight years earlier for $4,200,000, and annual depreciation deductions of $120,000 were taken each year for tax purposes. If the combined effective federal and state income tax rates on capital gains and tax depreciation recapture is 30%, what was the after-tax cash flow from the sale of the property? a. $2,288,000 b. $2,252,000 c. $2,540,000 d. $2,000,000

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