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Value Indication via Income Approach —"AS-STABILIZED" BASIS <br /> In the Direct Capitalization Method, we developed an opinion of market value by dividing year <br /> one net operating income by the selected overall capitalization rate. Our conclusion using the <br /> Direct Capitalization Method is as follows: <br /> CAPITALIZATIONDIRECT •D <br /> NET OPERATING INCOME $91,589 $10.18 <br /> Sensitivity Analysis Spread of: 0.50% Value $/SF of NRA <br /> Based on Low-Range of 8.50% $1,077,523 $119.75 <br /> Based on Most Probable Range of 9.00% $1,017,660 $113.10 <br /> Based on High-Range of 9.50% $964,099 $107.15 <br /> Preliminary Value $1,017,660 $113.10 <br /> Market Value "As-Stabilized" - Rounded to Nearest: • ••• $1,020,000 <br /> Value Indication via Income Approach - "AS-COMPLETED" BASIS <br /> The previous value conclusion was of the "as-stabilized" condition. To arrive at the "as- <br /> complete" condition, we will deduct the appropriate lease up costs that the most probable buyer <br /> would anticipate. Our lease up analysis, which is supported by our market analysis and market <br /> participant interviews, is as follows: <br /> COSTS <br /> Assumptions <br /> Average Lease-Up Period (years) 0.25 <br /> Vacant Space (SF) 8,998 <br /> Market Rent ($/SF) $12.00 <br /> Leasing Commissions ($or%) 6.50% <br /> Tenant Improvements $10.00 <br /> Free Rent (months) 0 <br /> Entrepreneureal Profit (%of lease-up) 10.00% <br /> Lease-Up Costs Value <br /> Rent Loss $26,994 <br /> Expense Carry $16,025 <br /> Leasing Commissions $35,092 <br /> Free Rent $0 <br /> Tenant Improvements $89,980 <br /> Total Lease-Up Costs $168,091 <br /> Plus Entrepreneurial Profit $16,809 <br /> Total Lease-Up Costs (With Profit) $184,900 <br /> Total Lease-Up Costs(With Profit, Rounded) $180,000 <br /> 105 1 Page <br />