You are considering purchasing an office building for $2,500,000. You expect the potential gross income (PGI) in the first year to be $450,000; vacancy and collection losses to be 9 percent of PGI; and operating expenses and capital expenditures to be 42 percent of effective gross income (EG). You will finance the acquisition with 45 percent equity and 55 percent debt. The annual interest rate on debt financing will be 70 percent. Payment will be made monthly based on a 25-year amortization schedule. a. What is the implied first year overall capitalization rate? 09.03% 10.92% 9.50% 9.97% Onone here b. What is the expected debt coverage ratio in year 1 of operations? 1.94 2.14 173 none here 204 the lender requires the DCR to be 1.25 or greater, what is the maximum loan amount O $2,128,289 $2,240,304 O none here $1,904,258 O $2,352,319 What is the debt yield ratio? 17.27 16.41 none here 19.86 18.13 You are considering purchasing an office building for $2,500,000. You expect the potential gross income (PGI) in the first year to be $450,000; vacancy and collection losses to be 9 percent of PGI; and operating expenses and capital expenditures to be 42 percent of effective gross income (EG). You will finance the acquisition with 45 percent equity and 55 percent debt. The annual interest rate on debt financing will be 70 percent. Payment will be made monthly based on a 25-year amortization schedule. a. What is the implied first year overall capitalization rate? 09.03% 10.92% 9.50% 9.97% Onone here b. What is the expected debt coverage ratio in year 1 of operations? 1.94 2.14 173 none here 204 the lender requires the DCR to be 1.25 or greater, what is the maximum loan amount O $2,128,289 $2,240,304 O none here $1,904,258 O $2,352,319 What is the debt yield ratio? 17.27 16.41 none here 19.86 18.13