First-year NOI from a long-term net lease is expected to be $50,000. Rent is escalating at a rate of 3 percent per year, but there is a two year period between adjustments. Thus, the income for years 1 and 2 will be $50,000, increasing to $50,000(1+.03)**2 = $53,045 in years 3 and 4, and so on. The discount rate is 14 percent. Assuming beginning-of-year payments, what is the approximate value of the leased fee?

1) $454,545

2) $294,118

3) $448,430

4) None of the above

Please do not copy from Chegg otherwise I have to report the answer. Explain the answer thoroughly by showing each step of the calculation.