Please show formulas on how numbers were gotten

Richard Jenkins is thinking of buying an apartment complex that is offered for sale by WKG Realty, an investment brokerage firm. The listing price of $3,250,000 equals the propertys market value. The following statement of income and expense is presented for the buyer's consideration:
The Pierre Apartments Prior Year's Operating Results, Presented by WKG Realty
30 units, all two-bedroom apartments, $1400 per month		$504,000
Washer and dryer rentals		10,000
Gross annual income		$514,000
Less operating expense:
Manager's salary	$34,000
Maintenance staff (part time)	12,000
Landscaping and snow removal	2,500
Property taxes	14,200	62,700
Net operating Income		$451,300
By checking the electric meters during an inspection tour of the property, the buyer determines the occupancy rate to be about 80%. He learns, by talking to tenants, that most have been offered inducements such as a months' free rent or special decorating allowances. A check with competing apartment houses reveals that similar apartment units rent for about $1290 per month and that vacancies average about 6%. Moreover, these other apartments have pools and other amenities that make their units worth about $20 more than those of The Pierre Apartments, which have neither.
The tax assessor states that the apartments were reassessed 12 months ago and that the current taxes are $85,039.
Jenkins learns that the super at the apartment complex, in addition to the $34,000 salary, gets a free apartment for her services. He also discovers other expenses: insurance will cost $7.00 per $1,000 of coverage, based on estimated replacement cost of about $1.9 million: workers' compensation ($145 per annum) must be paid to the state; utilities, incurred to light hallways and other common areas, cost about $95 per month for similar properties; supplies and miscellaneous expenses typically run about 0.30% of effective gross income. Professional property management fees in the market area typically are about 6% of effective gross income.
Assignments:
1. Develop a prior years' reconstructed operating statement, assuming typically competent, professional management. Based on the reconstructed NOI and current market value, determine the property's capitalization rate.
2. Develop a seven-year forecast of NOI for the The Pierre Apartments, incorporating all the following assumptions:
a. The inflation rate is 2.xx%, where xx is the last two digits of your Hofstra ID. Potential gross rent and miscellaneous other income will grow at this inflation rate every year over the forecast period.
b. The vacancy rate in the market area will remain at a constant percentage over the forecast period.
c. Operating expenses other than management fees and property taxes will grow at the same inflation rate (see a. above) over the forecast period.
d. Management fees as a percent of effective gross income will remain constant over the forecast period.
e. Property taxes are expected to increase to $93,543 in the third year of the forecast and to $102,897 in the seventh year.
3. Assuming that the property's capitalization rate that you determined in #1, above is also the market rate, and assuming this market rate will remain constant, develop an estimate of the property's market value at the end of the projected holding period.
4. Suggest some reasons why the market capitalization rate might NOT remain constant. Why might it become larger or smaller than the currently prevailing market rate?
Notes: 1. For Question #1, the rent and several expenses in the operating statement provided by the seller needs to be "reconstructed" (recalculated) based on the current market analysis that is provided in the case description. Read the description CAREFULLY. If the question provides figures about the property but ALSO provides "peer-group" property figures, you should use the information from the peer-group, they are more reliable indicators. 2. You should consider the current year (year of purchase) as "Year 0" and this is what you will call your reconstructed operating statement in question #1. 3. The next seven years (Question #2) will be considered Years 1-7, so all of these need to reflect the various increases in rent and expenses (as described in the case problem) over Year 0. Hint: your result for Question 2 should look similar to Figure 6.2 in Unit 6.

Richard Jenkins is thinking of buying an apartment complex that is offered for sale by WKG Realty, an investment brokerage firm. The listing price of $3,250,000 equals the property's market value. The following statement of income and expense is presented for the buyer's consideration: $504,000 10,000 $514.000 The Pierre Apartments Prior Year's Operating Results. Presented by WKG Realty 30 units, all two-bedroom apartments, $1400 per month Washer and dryer rentals Gross annual income Less operating expense: Manager's salary Maintenance staff (part time) Landscaping and snow removal Property taxes Net operatina Income $34,000 12.000 2,500 14,200 62,700 $451.300 By checking the electric meters during an inspection tour of the property, the buyer determines the occupancy rate to be about 80%. He learns, by talking to tenants, that most have been offered inducements such as a months' free rent or special decorating allowances. A check with competing apartment houses reveals that similar apartment units rent for about $1290 per month and that vacancies average about 6%. Moreover, these other apartments have pools and other amenities that make their units worth about $20 more than those of The Pierre Apartments, which have neither. The tax assessor states that the apartments were reassessed 12 months ago and that the current taxes are $85,039. Jenkins learns that the super at the apartment complex, addition to the $34,000 salary, gets a free apartment for her services. also discovers other expenses: insurance will cost $7.00 per $1,000 of coverage, based on estimated replacement cost of about $1.9 million workers' compensation ($145 per annum) must be paid to the state; utilities, incurred to light hallways and other common areas, cost about $95 per month for similar properties, supplies and miscellaneous expenses typically run about 0.30% of effective gross income. Professional property management fees in the market area typically are about 6% of effective gross income. Assignments: 1. Develop a prior years' reconstructed operating statement, assuming typically competent, professional management. Based on the reconstructed NOI and current market value, determine the property's capitalization rate. 2. Develop a seven-year forecast of NOI for the Tbe Pierre Apartments, incorporating all the following assumptions: . The inflation rate is 2.xx%, where xx is the last two digits of your Hofstra ID. Potential gross rent and miscellaneous other income will grow at this inflation rate every year over the forecast period. b. The vacancy rate in the market area will remain at a constant percentage over the forecast period. c. Operating expenses other than management fees and property taxes will grow at the same inflation rate (see a. above) over the forecast period. d. Management fees as a percent of effective gross income will remain constant over the forecast period. e. Property taxes are expected to increase to $93,543 in the third year of the forecast and to $102,897 in the seventh year. 3. Assuming that the property's capitalization rate that you determined in #1, above is also the market rate, and assuming this market rate will remain constant, develop an estimate of the property's market value at the end of the projected holding period. 4. Suggest some reasons why the market capitalization rate might NOT remain constant. Why might it become larger or smaller than the currently prevailing market rate? 1. For Question #1, the rent and several expenses in the operating statement provided by the seller needs to be "reconstructed" (recalculated) based on the current market analysis that is provided in the case description. Read the description CAREFULLY. If the question provides figures about the property but ALSO provides "peer-group" property figures, you should use the information from the peer-group, they are more reliable indicators. 2. You should consider the current year (year of purchase) as "Year O" and this is what you will call your reconstructed operating statement in question #1. 3. The next seven years (Question #2) will be considered Years 1-7, so all of these need to reflect the various increases in rent and expenses (as described in the case problem) over Year 0. Hint: your result for Question 2 should look similar to Figure 6.2 in Unit 6. Richard Jenkins is thinking of buying an apartment complex that is offered for sale by WKG Realty, an investment brokerage firm. The listing price of $3,250,000 equals the property's market value. The following statement of income and expense is presented for the buyer's consideration: $504,000 10,000 $514.000 The Pierre Apartments Prior Year's Operating Results. Presented by WKG Realty 30 units, all two-bedroom apartments, $1400 per month Washer and dryer rentals Gross annual income Less operating expense: Manager's salary Maintenance staff (part time) Landscaping and snow removal Property taxes Net operatina Income $34,000 12.000 2,500 14,200 62,700 $451.300 By checking the electric meters during an inspection tour of the property, the buyer determines the occupancy rate to be about 80%. He learns, by talking to tenants, that most have been offered inducements such as a months' free rent or special decorating allowances. A check with competing apartment houses reveals that similar apartment units rent for about $1290 per month and that vacancies average about 6%. Moreover, these other apartments have pools and other amenities that make their units worth about $20 more than those of The Pierre Apartments, which have neither. The tax assessor states that the apartments were reassessed 12 months ago and that the current taxes are $85,039. Jenkins learns that the super at the apartment complex, addition to the $34,000 salary, gets a free apartment for her services. also discovers other expenses: insurance will cost $7.00 per $1,000 of coverage, based on estimated replacement cost of about $1.9 million workers' compensation ($145 per annum) must be paid to the state; utilities, incurred to light hallways and other common areas, cost about $95 per month for similar properties, supplies and miscellaneous expenses typically run about 0.30% of effective gross income. Professional property management fees in the market area typically are about 6% of effective gross income. Assignments: 1. Develop a prior years' reconstructed operating statement, assuming typically competent, professional management. Based on the reconstructed NOI and current market value, determine the property's capitalization rate. 2. Develop a seven-year forecast of NOI for the Tbe Pierre Apartments, incorporating all the following assumptions: . The inflation rate is 2.xx%, where xx is the last two digits of your Hofstra ID. Potential gross rent and miscellaneous other income will grow at this inflation rate every year over the forecast period. b. The vacancy rate in the market area will remain at a constant percentage over the forecast period. c. Operating expenses other than management fees and property taxes will grow at the same inflation rate (see a. above) over the forecast period. d. Management fees as a percent of effective gross income will remain constant over the forecast period. e. Property taxes are expected to increase to $93,543 in the third year of the forecast and to $102,897 in the seventh year. 3. Assuming that the property's capitalization rate that you determined in #1, above is also the market rate, and assuming this market rate will remain constant, develop an estimate of the property's market value at the end of the projected holding period. 4. Suggest some reasons why the market capitalization rate might NOT remain constant. Why might it become larger or smaller than the currently prevailing market rate? 1. For Question #1, the rent and several expenses in the operating statement provided by the seller needs to be "reconstructed" (recalculated) based on the current market analysis that is provided in the case description. Read the description CAREFULLY. If the question provides figures about the property but ALSO provides "peer-group" property figures, you should use the information from the peer-group, they are more reliable indicators. 2. You should consider the current year (year of purchase) as "Year O" and this is what you will call your reconstructed operating statement in question #1. 3. The next seven years (Question #2) will be considered Years 1-7, so all of these need to reflect the various increases in rent and expenses (as described in the case problem) over Year 0. Hint: your result for Question 2 should look similar to Figure 6.2 in Unit 6