1 Start 1 2 5 6 8 IV 2 Key Assumptions 3 Construction cost ($) 2,500,000 4 Loan ($) 755,000 5 Loan interest rate 8.0% 6 Loan term (yrs.) 7 Hangar space (sq.ft.) 8 31,000 8 Rent ($/sq.ft. per mor 1.75 9 Rent inflator 2.3% 10 Operating Costs ($lyr 155.000 11 Cost inflator 2.3% + 12 Tax rate 21.0% 13 Discount rate 8.0% 14 Depreciation/year ($) 44,000 15 Cash Flows 16 17 18 19 20 21 22 23 24 = Net Operating Cash Flow 25 Rent Income minus: Operating Costs minus: Interest minus: Depreciation = Taxable Income minus: Taxes = Net Income minus: Principal minus: Cash Outlay at Start 651,000 665,973 681.290 (155,000) (158.565) (162,212) (60.400) (54,722) (48.589) (44,000) (44,000) (44,000) 696,960 712,990 729,389 (165,943) (169,760) (173,664) (41,965) (34,812) (27,087) (44,000) (44,000) 746,165 763,327 (177,658) (181,744) (18,743) (9,732) (44,000) (44,000) (44,000) 391,600 408,686 426,489 445,052 464.419 484,638 505,764 527,850 82,236 85,824 89,563 93.461 97,528 101,774 106,210 110,849 309,364 322,862 336.926 351,591 366,891 382,864 399,554 417,001 (70,991) [76 660) (82.792) (89,416) (96.569) (104,295) (112,638) (121,649) 238.373 246,202 254.134 262.175 270,322 278.569 286,916 295,352 (2,500,000) 26 plus: Depreciation 27 = Total Cash Flows 28 NPV 29 IRR (2,500,000) -446.099 [DX] 44.000 282,373 44.000 290.202 44.000 44.000 44,000 44,000 44,000 44,000 298,134 306.175 314,322 322,569 330.916 339,352 15,266,540 30 Note: Tax shields are the tax gains from expensing interest and depreciation. The formula is interest or depreciation expense times the tax rate 31 < Hangar NPV Loan amortization Break even v. MAR24 | +