-A REIT Has an NOI of $15 as Share and

question 28

Multiple Choice

$$\begin{array} { l r } \text { Net revenue } & \$ 20,000,000 \\\text { Less: } & \\\text { Operating expenses } & 9,800,000 \\\text { Depreciation and } & \\\text { amartization } & \underline{4,400,000} \\\text { Incame fram aperations } & 5,800,000 \\\text { Less: } & \\\text { Interest expense } & \underline{1,280,000}\\\text { Net incame } &\$ \underline{4,520,000}\\\end{array}$$
-A REIT has an NOI of $15 as share and currently pays a dividend of $10 a share. The dividend is projected to increase by 4 percent by next year and continue to increase by 4 percent per year thereafter. Assuming that the blended cap rate is 9.75 percent and the required rate of return is 10.5 percent, what value would the Gordon Dividend Discount Model provide?

• A) $60.15
• B) $71.89
• C) $153.85
• D) $160.00
• E) $190.00

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Definitions:

Secured Loan

A loan backed by collateral, reducing the risk for lenders and often resulting in more favorable loan terms for the borrower.

Unsecured Loan

A loan that is issued and supported only by the borrower's creditworthiness, without any collateral.