What will be the proforma projection of property level before tax cash flow (PBTCF) in Year 2 for a three

unit apartment house in which (a) each unit currently (year 1) rents for $300/month; (b) rents are

projected to grow at 3% per year; (c) the average tenant will remain three years, and then the apartment

will be vacant an average of three months before the next tenant moves in; (d) operating expenses are

currently estimated at $1,500 per unit per year (including management expenses), expected to escalate

at 3% per year; (e) you anticipate needing to replace kitchen appliances for $1,000 per unit in year 3;

and (f ) you anticipate having to replace the single roof for $2,500 in year 5.

A. $2802

B. $5633

C. $5469

D. None of the above