Question
A property owner is evaluating the following alternatives for leasing space in his office building for the next five years: Net lease with CPI adjustments
A property owner is evaluating the following alternatives for leasing space in his office building for the next five years:
Net lease with CPI adjustments. The rent will be $16 per square foot the first year. After the first year, the rent will be increased by the amount of any increase in the CPI. The CPI is expected to increase 4 percent per year.
Calculate the effective rent to the owner (after expenses) for the lease using a 10 percent discount rate
A. $21.48
B. $17.90
C. $16.11
D. $19.69
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Law And Financial Stability
Authors: International Monetary Fund
1st Edition
1513523007, 978-1513523002
