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You have just been contacted by a broker who has informed you that the Bannon Building is on the market. The asking price for the

You have just been contacted by a broker who has informed you that the Bannon Building is on the market. The asking price for the property is $9.35M and the basic market, lease, and mortgage information are summarized in the table below. Assume that the current tenants lease will expire at the end of year 3. (a) Given the information in the data sheet, project net operating income for this property for a period of 6 years. (b) Using the initial capitalization rate as your basis for determining the reversion value of the property in year 5. What is the unlevered return on your equity investment assuming that you receive this estimated reversion value at the end of your holding period

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