An owner of the Atrium Tower Office Building is currently negotiating a five-year lease with ACME Consolidated Corporation for 20,000 rentable square feet of office space. ACME would like a base rent of $15 per square foot with step-ups of $1 per year beginning one year from now. ATRIUM would provide ACME a $53,000 moving allowance and $130,000 in tenant improvements (TIs). What is the effective rent (per SF) assuming a discount rate of 10%?
An owner of the Atrium Tower Office Building is currently negotiating a five-year lease with ACME Consolidated Corporation for 20,000 rentable square feet of office space. ACME would like a base rent of $15 per square foot with step-ups of $1 per year beginning one year from now. ATRIUM would provide ACME a $53,000 moving allowance and $130,000 in tenant improvements (TIs). What is the effective rent (per SF) assuming a discount rate of 10%?
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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An owner of the Atrium Tower Office Building is currently negotiating a five-year lease with ACME Consolidated Corporation for 20,000 rentable square feet of office space. ACME would like a base rent of $15 per square foot with step-ups of $1 per year beginning one year from now. ATRIUM would provide ACME a $53,000 moving allowance and $130,000 in tenant improvements (TIs). What is the effective rent (per SF) assuming a discount rate of 10%?
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