Presented with the off$-$market opportunity to personally purchase a $40,000$ SF$,$ single$-$tenant retail store leased to Best Box, a regional leader in consumer electronics $+$ appliances

You are a personal friend of the Best Box CEO & she recently approached you about purchasing their flagship store

Upon selling the store, Best Box would leaseback the property from you on a $20-$year lease with $5\%$ rent increases every $5$ years

The proposed rent is $$25/$SF$/$Yr NNN

You've been working hard the last few years at A$.$CRE Development and have banked several six$-$figure promotes

Those earnings have been sitting in a high$-$yield savings account, awaiting the right opportunity

$-$ Could be a great opportunity to put those funds to work for $5-10$ years at a yield substantially better than your savings account

Before making a decision, you decide to analyze the investment

RSF is $40,000$

Income is $$25/$ RSF growing $5\%$ every five years

Reimbursable expenses are $$5/$ RSF growing $1\mathrm{.}5\%$ per year

Asking cap rate is $6\mathrm{.}25\%$ on year $1$ NOI

Disposition cap rate at the end of a $5-$year hold period is $6\mathrm{.}50\%$

The investment is financed by a loan at $70\%$ LTV$,3\mathrm{.}25\%$ rate & a $30-$year amortization period

What is the asking price amount?

What is the unlevered IRR?

What is the levered IRR?

What is the year $3$ free and clear return?