An apartment building can be purchased for $1.8 million. It is expected to generate annual NOIs of: Yr.1: $154,000; Yr.2: $158,620; Yr.3: $163,379; and is expected to be sold resulting in a net sale proceed in Yr. 3 of $2.26 million. In addition, it is expected to generate BTCFs of: Yr.1: $59,190; Yr.2: $63,810; Yr.3: $68,568. Assume the project includes a $1.25 million loan having an annual debt service of $94,810 per year, and that the outstanding mortgage balance at the end of the three-year holding period will be $1.20 million. Assume the investors required return on the project, unleveraged, is 12 percent; and the investors required return on the project, leveraged, is 18 percent. Using the appropriate information, what is the VALUE OF THE EQUITY, Ve, if the project is LEVERAGED?

907,010

1,719,370

782,870

1,255,540