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In class we talked about the inverse relationship between cap rates and values. The lower the cap rate, the higher the value. Assume a real
In class we talked about the inverse relationship between cap rates and values. The lower the cap rate, the higher the value. Assume a real estate company pursues a develop-to-sell strategy. This is to say that the company acquires land, develops a building on it, and then leases it up so that its un-leveraged yield on cost is 7%. At the time of sale, at what disposition cap rate will it make the most money? O 8% O 7% O 6% O 5%
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