A property is projected to have NOI of $350,000 during the first year and increase by 2% per year thereafter. The property can be sold after 5 years based on applying a 8% terminal cap rate. A loan can be obtained at 4.75% interest with monthly payments amortized over a 25-year term. The lender requires a 1.30 debt coverage ratio applied to the first year NOI.

Excel Link: Excel Sheet.xIsx

What is the before-tax equity reversion (BTER)?

$2,693,607.70

$5,600,000.21

$2,772,831.46

$1,358,506.24