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You are considering the purchase of a commercial office property. Given your research, you have determined that an appropriate cap rate for this property is
You are considering the purchase of a commercial office property. Given your research, you have determined that an appropriate cap rate for this property is 5.74%. The most recent net operating income (NOI) for the property was $103,000, but is expected to grow to $164,000 during the upcoming (first) year. What is your estimate of the property's market value using the direct capitalization method?
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