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<br /> <br /> <br /> <br /> <br />PROJECTED VALUE – CENTRE COURT BUILDING <br /> <br />NOI $ 649,476 <br />Divided by Cap Rate 7.5% <br /> <br />PROJECTED VALUE $8,659,679 <br /> <br />@ 8% Cap Rate $8,118,450 <br /> <br /> <br />DEBT SERVICE : (Including Washburne Building and Vacant Parcel) <br /> <br /> Amount Terms Annual Payments <br />Proposed: <br />Section 108 – Loan #2 $ 5,189,000 20yr/5% $ 410,941 <br />City – DRLP Loan 350,000 20yr/5% 27,718 <br />Existing: <br />Section 108 – Loan #1 $2,706,000 20yr/5% 214,301 <br />City – DRLP Loan/Vacant Parcel 404,000 20yr/5% 31,995 <br />TOTAL $ 8,649,000 $ 684,955 <br /> <br /> <br /> <br />NOI – Centre Court Bldg. $ 649,476 <br />NOI – Washburne Bldg. 142,837 <br /> Total $ 792,313 <br /> <br /> Total Debt Service $ 684,955 <br /> <br />Debt Service Coverage – 108 Debt 1.27 <br />Debt Service Coverage – All Debt 1.16 <br /> <br />Projected income is based on a range of lease rates between $1.33/mo. to $1.67/mo. Rates are <br />based on a modified gross lease which requires the tenant to pay the base lease rate plus a load <br />factor for a share of the utility and janitorial service costs. The second floor, which includes the <br />th <br />large rounded windows and the 5 floor are expected to demand the highest lease rates. The <br />range of rates is considered to be within the range of market rents for retail and office space in <br />the downtown core area. Income projections include a 10% vacancy factor. Operating expenses <br />at 24% of income are within standard operating cost assumptions for commercial buildings. <br />(Note: Net operating income for the Washburne Building is derived from the 2007 appraisal). <br /> <br />A 7.5% cap rate is used to derive the value of the property upon completion. Applying the cap <br />rate to $649,476 in projected NOI results in a projected value of approximately $8.6 million <br />($134/sq ft). A more conservative 8% cap rate analysis is also provided. <br /> <br />4 <br />