RIC RED M6U2 Activity Submission- View 125 % -> T Zoom + Instructions Add Category Answer sheet Insert Table Chart Text Shope Media Comment Collaborate TOTAL: 20 3. Questions Question 1 Suppose you are looking to develop a new retail property where the following is applicable: Gross square feet 172,000 Loss factor 0% Development cost per square foot $ 322 Revenue per square foot $ 40 Calculate the NPV and IRR if the absorption rate is 0% in Year 1, 55% in Year 2, 85% in Year 3, and 100% from Year 4 onward, with an expected sale in Year 6. Only fill in the gray blocks. What are the two elements that influence the difference in cash flow from year to year? Question 2 Assume that things have not turned out as expected in terms of when NOI stabilizes. Calculate the NPV and IRR if the absorption rate is 10% in Year 1, 90% in Year 2, 75% in Year 3, 100% from Years 4 to 7, 50% in Year 8, and 100% from Year 9 onward, with an expected sale in Year 10. Compare the IRR from Question 1 with the IRR in Question 2. Explain the reasons for this difference. Your answer should not exceed 150 words. Ba