You are an appraiser for BlackRock and are asked to appraise a 14,300-square-foot Class B office building in the central business district of Austin in 2018. You are given the following information to use in valuing the property: $113,000 5% $18,200 $5,600 $18,600 $19,000 $5,100 Revenues Poterntial gross income Vacancy and collection losses, percent of PGI Operating expenses Utilities Repairs Maintenance Property taxes Insurance Assumed growth rates per year Rental income Reapairs and maintenance Property taxes Insurance Utilities Equity dividend rate Loan information Loan to value ratio Mortgage interest rate Loan amortization period Discount Rate for DCF Approach Discount rate 3.5% 6% 6% 4.5% 3% 16% 75% 10% 20 years 12% a. Compute the value of the office building using the direct capitalization method. b. Determine the value of the office building using a discounted cash flow model. (You can find the expected selling price at the end of year 6 by assuming the terminal (going-out) capitalization rate is 11%. You are an appraiser for BlackRock and are asked to appraise a 14,300-square-foot Class B office building in the central business district of Austin in 2018. You are given the following information to use in valuing the property: $113,000 5% $18,200 $5,600 $18,600 $19,000 $5,100 Revenues Poterntial gross income Vacancy and collection losses, percent of PGI Operating expenses Utilities Repairs Maintenance Property taxes Insurance Assumed growth rates per year Rental income Reapairs and maintenance Property taxes Insurance Utilities Equity dividend rate Loan information Loan to value ratio Mortgage interest rate Loan amortization period Discount Rate for DCF Approach Discount rate 3.5% 6% 6% 4.5% 3% 16% 75% 10% 20 years 12% a. Compute the value of the office building using the direct capitalization method. b. Determine the value of the office building using a discounted cash flow model. (You can find the expected selling price at the end of year 6 by assuming the terminal (going-out) capitalization rate is 11%