APARTMENT CASH FLOW ASSIGNMENT An investor is considering buying an apartment building with 140-units offered for sale at $16,500,000. The subject apartment building has the following unit mix: Additionally, the following assumptions are also being made by the investor in order to construct a 6-year cash flow: Potential Rental Income Potential rental income is based on the above unit mix. The 1-bedroom and studio rental rates are expected to increase at 2% annually. The 2-bedroom units are also expected to increase at 3% annually. Potential rental income is based on the above unit mix. The 1-bedroom and studio rental rates are expected to increase at 2% annually. The 2-bedroom units are also expected to increase at 3% annually. Other Income Other income will be generated from parking and miscellaneous services provided by the landlord. Parking will generate $75per space per month for all of the units in the building. Miscellaneous income will approximate $4,000 per month. Other income will grow at 2% per year. Vacancy and Credit Loss In the current market, vacancy and credit losses are running at 9% on all income. Due to the improving market conditions as well as the investors prior experience leasing and operating multifamily buildings, its expected that vacancy will steadily decline by 1% per year over the next 6 years to 4%.