You have been presented with the following set of financial statements for National Property Trust, a REIT that is about to make an initial stock offering to the public. This REIT specializes in the acquisition and management of warehouses. Your firm. Blue Street Advisors, is an investment management company that is considering the purchase of National Property Trust shares. You have been asked to prepare a financial analysis of the REIT. National Property Trust Panel A. Operating Statement Summary Net revenue Less: Operating expenses Depreciation and amortization General and administrative expenses Management expense Income from operations Less: Interest expense* Net income (loss) *At 8% interest only $ 186,800,000 42,400,000 28, eee, ee 6,600,000 3,600,000 25,408,888 6,400,000 $ 19, 200,000 Panel B. Balance Sheet Summary Assets Cash $ 52,100,eee Rents receivable 3, 100, eee Properties @ cost 760, 600, eee Less: Accumulated depreciation 456, 98,888 Properties-net 384, eee, see Total net assets $ 359, 288,888 Liabilities Short term $ 61,200,000 Mortgage debt 89, eee, see Total 141,200,000 Shareholder equityt 218,000,000 Total liabilities and equity $ 359, 200, eee *At 8% interest only. $10.000.000 shares outstanding. Required: a. Develop a set of financial ratios that will provide Blue Street Advisors with useful information in the evaluation and comparison of National Property Trust with other REITS. b. Your research also indicates that the shares of comparable REITs specializing in warehouse acquisitions in the same regions are selling at dividend yields in the range of 8 percent. Price multiples for these REITs are about 12 current FFO. What price range does this suggest for National shares? c. What is the NAV for National Property Trust assuming that a blended capitalization rate of 10 percent would be applicable for the properties owned by Blue Street Advisors? Required A Required B Required c Develop a set of financial ratios that will provide Blue Street Advisors with useful information in the evaluation and comparison of National Property Trust with other REITs. (Round your intermediate calculations and final answers to 2 decimal places. Negative values should be indicated by a minus sign. ROA and ROE should be entered as percentages.) EPS NOI FFO ROC Cash Retention per Share Net Assets per Share Equity or Book Value per Share ROA ROE % Required A Required B > Required A Required B Required Your research also indicates that the shares of comparable REITs specializing in warehouse acquisitions in the same regions are selling at dividend yields in the range of 8 percent. Price multiples for these REITs are about 12 current FFO. What price range does this suggest for National shares? (Round your intermediate calculations and final answers to 2 decimal places.) Price range from to Complete this question by entering your answers in the tabs below. Required A Required B Required What is the NAV for National Property Trust assuming that a blended capitalization rate of 10 percent would be applicable for the properties owned by Blue Street Advisors? (Round your answer to 2 decimal places.) NAV per share Required A Required B Required Your research also indicates that the shares of comparable REITs specializing in warehouse acquisitions in the same regions are selling at dividend yields in the range of 8 percent. Price multiples for these REITs are about 12 current FFO. What price range does this suggest for National shares? (Round your intermediate calculations and final answers to 2 decimal places.) Price range from to Complete this question by entering your answers in the tabs below. Required A Required B Required What is the NAV for National Property Trust assuming that a blended capitalization rate of 10 percent would be applicable for the properties owned by Blue Street Advisors? (Round your answer to 2 decimal places.) NAV per share
