Use the information to answer 36-38. Consider the following financial information for an existing retail investment. Total rentable space: 30,000 square feet (SF) and consists of 3 retail spaces:

• Space 1: 17,000 SF pre-leased to a Pharmacy with a 7-year gross lease at $14/SF (to increase by 2.5%/year); tenant to begin lease on 2/16. (Leasing commission paid in 2015).
• Space 2: 4,500 SF expected to lease to a Chinese restaurant with a 3-year net lease at $12/SF with a $3.50/SF annual expense stop; tenant to begin lease on 5/16.
• Space 3: 8,500 SF expected to lease to a Movie rental store with a 5-year triple net lease at $7.50/SF; tenant to begin lease on 1/16. Tenant offered $3/SF in tenant improvement dollars.
• Market assumptions: When the 3-year lease on the Chinese restaurant up expires, there is a 40% chance the tenant will renew. If the tenant does not renew, the space is expected to remain vacant for 5 months until a new tenant arrives. A renewal or a new lease will be subject to a market rent of $15.50/SF on a 3-year gross lease.
• Reimbursable expenses: Include Common Area Maintenance (CAM) of $3.50/sf (this is 60% variable) and expected to increase by 1% each year. Occupancy in 2017 is projected to be 100%.

What is Potential Base Rental Revenue for the shopping center during 2017?

Question options:

$355,750

$367,799

$398,000

$361,700

What is the expected Occupancy during 2016?

Question options:

61.9%

86.0

64.4%

81.6%

What is the Common Area Maintenance (CAM) expense projected to be in 2017?

Question options:

$110, 240

$81,025

$106,050

$105,748