In this assignment, there are two illustrations that demonstrate operation of income-producing property of different type. In both illustrations, a Pro-Forma statement of cash-flow need to be developed that show the Net Operating Income (NOI)for each property. The purpose of this assignment is to show the impact of income and expenses assumptions on the NOI of the respective property types. Retail Properties. Shady Elm Community Shopping Center, a community center with 245,000 square feet of rentable space. It includes one 70,000 square foot grocery store and one 40,000 square foot home dcor/furnishings store as anchor tenants and 30 other in-line or shop tenants. It includes an interior, covered, and air conditioned mallway which provides 80,000 square feet of common are access for the entire center. Base rents are expected to average RM16.73 per square foot; however, six tenants in the center have executed percentage rent leases. It is expected that these leases will produce overage rents of RM308,700 during the base year. Common Area Maintenance (CAM) expenses recoverable from tenants for maintenance of the 80,000 feet of mallway and other common area (parking lots, etc.) are expected to be RM1,139,250 or about RM4.65 per rentable foot. After considering rents, overage rents, other income, and CAM recoveries less vacancies, Shady Elm is expected to produce effective gross income of RM5,375,300 during the base year. Total operating expenses to be paid by the owner are expected to be RM1,875,700. Other items expected to be paid by the landlord include an allowance for tenant and capital improvements amounting to RM315,000. Develop a Pro-Forma statement for a base year showing the NOI. Apartment Properties Betts Distribution Center, and Internet-based order fulfillment/distribution/office/warehouse property. In addition to recoverable operating expenses, the new tenant will be billed for pass throughs including insurance and property taxes, which will then be paid by the owner. The information is given as follow:

Property Information: BETTS DISTRIBUTION CENTER Age of building Rentable space Single tenant 8 years old 200,000 sq. ft. 10 years lease term, net, net Financial Information: Rent Recoverable expenses from tenant Operating expenses Property taxes Insurance RM7 per sq. ft., fixed RM1.50 per sq. ft., fixed RM700,000 RM50,000 RM15,000 Other Cash Outlays: Allowances for: Recurring CAPEX/Improve Allowance. RM60,000 Develop a Pro-Forma statement for the Betts property for a base year showing NOI. Both Pro-Forma accounts need to be prepared in Microsoft excel format. Property Information: BETTS DISTRIBUTION CENTER Age of building Rentable space Single tenant 8 years old 200,000 sq. ft. 10 years lease term, net, net Financial Information: Rent Recoverable expenses from tenant Operating expenses Property taxes Insurance RM7 per sq. ft., fixed RM1.50 per sq. ft., fixed RM700,000 RM50,000 RM15,000 Other Cash Outlays: Allowances for: Recurring CAPEX/Improve Allowance. RM60,000 Develop a Pro-Forma statement for the Betts property for a base year showing NOI. Both Pro-Forma accounts need to be prepared in Microsoft excel format