what is the loan to value ratio for this project?
can you also show me the formula in excell thank you
AL VALUE OF MONEY APPLICATIONS 203 Siesta Restaurant Operating Results (000) 2002 2003 Revenue 2004 Food 2005 2006 Beverage Total $900 350 1,250 $925 360 1,285 $950 365 1,315 $975 370 1.345 $1,000 375 1,375 240 Operating expenses Food cost Beverage cost Labor cost Travel 300 120 65 162 60 685 Marketing Utilities 20 Rent 160 75 80 Total 163 165 1,240 150 1,290 1,332 1,372 1,405 Operating Profit (Loss) $10 $(5) $(17) S(27) $(30) Based on Paris's market analysis, tour of the competition, inspection of the subject property. and interviews with the prior owner, she concludes a Star Restaurant would work in the subject mace but it would require approximately $200,000 of renovation and conversion cost in addition to the land purchase price of $2,000,000. By Year 5, the restaurant could generate $2.5 million in annual food revenue and $1.5 million in annual beverage revenue. Ms. Brown estimates the following cash flows for the first five years of operations, with cash flows leveling off in Year 5. Cash Flow $695,000 876,250 1,057,500 1,238,750 1,420,000 1. Calculate the IRR and NPV of this project utilizing a 12% discount rate and a 15% cap rate. Ms. Brown was able to secure a loan for $1,540,000, and an equity investor agreed to invest the main $660,000 in exchange for 20% ownership in the project AL VALUE OF MONEY APPLICATIONS 203 Siesta Restaurant Operating Results (000) 2002 2003 Revenue 2004 Food 2005 2006 Beverage Total $900 350 1,250 $925 360 1,285 $950 365 1,315 $975 370 1.345 $1,000 375 1,375 240 Operating expenses Food cost Beverage cost Labor cost Travel 300 120 65 162 60 685 Marketing Utilities 20 Rent 160 75 80 Total 163 165 1,240 150 1,290 1,332 1,372 1,405 Operating Profit (Loss) $10 $(5) $(17) S(27) $(30) Based on Paris's market analysis, tour of the competition, inspection of the subject property. and interviews with the prior owner, she concludes a Star Restaurant would work in the subject mace but it would require approximately $200,000 of renovation and conversion cost in addition to the land purchase price of $2,000,000. By Year 5, the restaurant could generate $2.5 million in annual food revenue and $1.5 million in annual beverage revenue. Ms. Brown estimates the following cash flows for the first five years of operations, with cash flows leveling off in Year 5. Cash Flow $695,000 876,250 1,057,500 1,238,750 1,420,000 1. Calculate the IRR and NPV of this project utilizing a 12% discount rate and a 15% cap rate. Ms. Brown was able to secure a loan for $1,540,000, and an equity investor agreed to invest the main $660,000 in exchange for 20% ownership in the project
