Real-estate developer considering

Assignment Help Business Economics

Reference no: EM13984439

J&M Company is a real-estate developer considering a 40-unit apartment complex in a growing college town. As the area is also booming with foreign automakers locating their U.S. assembly plants the firm expects that the apartment complex, once built, will enjoy a 90% occupancy for an extended period. The firm already complex some of the critical financial information related to the development project as follows: *land price (1 acre)=$1200000 *building(40 units of single bedroom):$4800000 *project life:25years *building maintenance per unit per month:$100 *annual property taxes and insurance:$400000 Assuming that the land will appreciate at an annual rate of 5% ,but the building will have no value at the end of 25 years(it will be torn down and a new structure would be built), determine the minimum monthly rent that should be charged if a 12% return (or 0.9489% per month)before tax is desired.

Reference no: EM13984439

Questions Cloud

Country has the comparative advantage in producing cloth : If a country has the comparative advantage in producing cloth, in the market for cloth the autarky price would be _____ the world price and the country would _____ cloth.

An increase in the demand for autoworkers : An increase in the demand for autoworkers may come about because of all of the following EXCEPT a(n):

Same amount of monopsony power : Does Major League Baseball impose more, less, or the same amount of monopsony power on rookie players (those in their first few years in the majors) as on veteran players (say. those with 10+ years in the majors)? In explaining your answer, explain t..

Is relation between investment level and income per capita : Explain in what sense coordination failure can lead to multiple equilibria in a given economy. Provide an economic example of coordination failure.

Real-estate developer considering : J&M Company is a real-estate developer considering a 40-unit apartment complex in a growing college town. As the area is also booming with foreign automakers locating their U.S. assembly plants the firm expects that the apartment complex, once built,..

Elements of the health care system that most need reform : Write a paper of (1,100) that lists the top five elements of the health care system that most need reform, in your opinion. Justify your choices through a logical analysis of the elements' impact on the current system

What additional considerations might lead leisure products : What assumptions did you make in calculating the incremental cost in Question 1? What additional information would be helpful in making these calculations?

What caused the great depression of the 1930s : Using your book, films, and Internet resources can you discuss what caused the Great Depression of the 1930's? Use APA format

Responders face when sheltering special needs populations : What challenges do emergency managers and responders face when sheltering special needs populations? Does a community have an obligation to shelter all vulnerable or special needs populations even if they do not possess the equipment or skills to do ..

User Account

All Pages