Practice IRV Problems Gross Potential Rental Income (if all units rented) - Vacancy and Collection Loss Miscellaneous Income = Effective Gross Income - Operating Expenses = Net Operating Income (NOI) IRV Formula(s): I = R*V R = I/V V = I/R I = Income R = Rate V = Value A property has a Net Operating Income of $350,000 and the market indicates similar properties achieve a 12% rate of return. How much is this property worth? A property has a market value of $600,000 and a NOI of $48,000. What is its rate of return? An owner requires a 9% rate of return on her $4,700,000 single-tenant specialty warehouse. The rent will be NNN (triple net - tenant pays all expenses) and there is no miscellaneous income. How much rent should she charge?