A Property Is Purchase for $15 Million

question 21

Multiple Choice

A property is purchase for $15 million. Financing is obtained at a 75% loan-to-value ration with total annual payments of $1,179,000. The property produces an NOI of $1,400,000. What is the equity dividend rate ratio of first year cash flow to equity) ?

• A) 5.89%
• B) 9.33%
• C) 7.86%
• D) 8.64%

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