Question $1.$We are considering an acquisition of an existing medical office

building $($MOB$)$ to our portfolio.$$There are $4$

tenants.$$Tenants $1$ and $2$ occupy $15,000$ and $8,000$ square

feet respective, at $$19\mathrm{.}00$ per square foot.$$Tenant $3$ has

$10,000$ at $$20\mathrm{.}00$ and tenant $4$ has $4,000$ at $$22\mathrm{.}00.$ All the leases

are presently expected to continue through the $4$ year holding

period and have CPI increases estimated at $2\%$ per

year.$$The asking price for the property is $$3,000,000$ of

which $75\%$ of the value would be allocated to the building; and

vacancy and collection losses are projected at $10\%$ of

rents.$$First year operating expenses include $$120,000$

$($i$.$e$.$ taxes, insurance, utilities, maintenance, etc.$)$ and

management estimated at $5\%$ of EGI.$$Our tax rate is $36\%$

and all loses are recognized in the year they are incurred. Capital

gains and depreciation recapture are both taxed at

$15\%.$A $70\%$ loan can be obtained at $9\mathrm{.}5\%$ for $25$

years.$$Both the property value and operating expenses

are expected to grow $4\%$ per year and our projected holding period

is $4$ years.$$Selling expenses are projected at $4\%$ of the

gross sales price.$$The reinvestment rate for cash flows

is $7\%$ and the discount rate is $12\%.$@ $65\%7\%$@ $70\%10\%$@$75\%12\%$@$80\%15\%$Does this project have positive or

negative leverage at the given LTV levels?