Purpose

The purpose of this assignment is to $(1)$ Create an Excel workbook that is flexible and easy

to follow.

Information and Data

You will use a five$-$year holding period for analysis purposes, all information collected which

is labeled as current is for the end of $2023,$ year $0,$ and the date of analysis is July $1,2024$

$($year $1).$

Since the property has "opted out" of displaying information in the county records, two

properties in the block next door, $1009$ and $1015$ Gervais St$,$ which are about the same

position in the block, with two story buildings, and with publicly available information were

used to approximate the land value portion of the total value of $21\mathrm{.}6\%.$

Suites A$,$ B$,$ and C are on the $1$st floor and have their own entry and the entry to Suite D$,2$nd

floor is on the southeast corner of suite C$.$ Suite A is a restaurant, $1,908$ rentable SF$,$ with a

$10-$year lease, $6$ years remaining, at $$25$ pSF$.$ Suite B is a barber shop, $1,215$ rentable SF

with a $10-$year lease, $8$ years remaining, at $$23$ per square foot. Suite C is currently

untenanted but was most recently an office for an online service company and listed at

$1,702$ rentable sf$,2$ parking spaces, and $$30$ pSF$.$ Suite D is available with six individual

offices, a conference room, employee breakroom, reception area, and a large open

desk$/$work space. It is listed as $4,825$ rentable sf$,7$ parking spaces, and $$30$ pSF$.$ All leases

at this property are NNN with an annual increase of $2\%.$

According to LoopNet, the average cost of retail space, which includes restaurants and

services, is on average $$23\mathrm{.}70$ per square foot, and for office space $$21\mathrm{.}06$ per square foot.

The vacancy and Collections allowance rate is

After some research which include your assignment #$1$ results and the attached table, you are

ready to:

$1.$ Project income and expenses for holding period$+1$ years,

$2.$ Calculate the NOI for each year of the holding period,

$3.$ Calculate the Net Proceeds from Sale of property at the end of the holding period,

$4.$ Calculate the property value using the direct capitalization method for purchase now

$($year $0).$

$5.$ Calculate the unlevered and before income tax

a$.$ PV$($year $1-5$ NOI$),$

b$.$ PV$($Net Proceeds from sale of property in year $5),$

c$.$ IRR$($Year$0-5).$

$6.$ Finally, answer the question: What do these intermediate results tell you about this

potential investment?$\backslash$table$[[$Address$,929$ Gervais St$],[$Location$,$Columbia SC$],[$Built In$,1,940],[$Square Feet,$9,336],[$Number of Units,$2],[$Suite C $-1$st Floor,$1702SF,$$$51,060,$Per year$],[$Suite D $-2$nd Floor,$4825SF,$$$144,750,$per year$],[$Location Information$],[$Downtown Columbia$],[$County$,$Richland County,,$],[$City$,$Columbia,,$],[$Parking Ratio,$\frac{1\mathrm{.}13}{1000}SF,,],[$Avg Household size,$1\mathrm{.}60-2\mathrm{.}20,,],[$Median Home Value,$$278,512-$$$170,250,,],[$Population Growth,$0\mathrm{.}83\%-3\mathrm{.}22\%,,]]$