Joan and John purchase a building that generates a stabilized NOI of $900,000 and has a capitalization rate of 8%. It has been financed with a mortgage loan of $6,750,000 with a 5-year term, a 25-year amortization and an interest rate of 6%.

a) Calculate the Loan to Value (LTV)

b) Calculate the Debt Service Coverage (DSCR).

c) Calculate the loan balance at the end of one year.

d) If they sell the building at the end of the year for $12,000,000 what is their Return on Equity (ROE)?