A property owner has provided you with the following information. Assume the owner has no other assets or liabilities. The annual gross revenue is $3,275,000. The debt service payment on the loan is $147,000 per month. The capitalization rate is 8%. Assets: Cash $ 1,000,000 Land 1,500,000 Building 29,500,000 Total Assets $ 32,000,000 Liabilities & Equity: Nonrecourse Liabilities $ 25,000,000 Partners Capital 7,000,000 Total Liabilities & Capital $ 32,000,000

14. What is the propertys NOI?

Calculate the Debt Service Coverage Ratio?

What is the Debt to Asset Ratio?

Last years Debt Ratio for the property was 74%. The industry average Debt to Asset ratio is 82%. Based on the available information would you consider this to be a low, normal or high risk investment and why?

What is the Effective Gross Income Multiplier?