- 13 -
Raldon Corp. Year 1 Year 2 Year 3 Year 4 Total
Builder lease payments$61,819$30,909 -0- -0- $92,728
Tax, ins., HOA reimburse4,476 2,238 -0- -0- 6,714
Tenant rental -0- 17,489 $37,776 $40,79896,063
Rental deficit contribution -0--0- -0- -0- -0-
Interest income -0- -0- -0- -0- -0-
Total revenue 66,295 50,636 37,776 40,798 195,505
First trust interest-68,031-68,031 -68,031 -68,031-272,124
Tax, ins., HOA expense-4,476 -4,476 -4,476 -4,476 -17,904
Repairs & maintenance-0- -1,215 -2,430 -2,430 -6,075
Property management fee-2,100 -2,100 -2,100 -2,100 -8,400
Audit fee -607 -607 -607 -607 -2,428
Interest on EPIC advances-6,288 -6,288 -6,288 -6,288 -25,152
Total expenses -81,502-82,717 -83,932 -83,932-332,083
Anticipated cash deficit-15,207-32,081 -46,156 -43,134-136,578
As a percent of purchase-3.13% -6.60% -9.50% -8.88% -28.10%
price
According to the above analysis, EPIC projected a cash
deficit from the transaction at the end of the fourth year
of $136,578 or 28.10 percent of the original purchase
price (viz $485,995). EPIC further projected that the
following appreciation rates would be required to recoup
the investment in the properties after sales expenses of
7 percent and a disposition fee of 2.5 percent to be
paid to EPIC:
Investment Appreciation Rate
End of 2d year1$615,744 12.56
End of 3d year 1678,408 111.76
End of 4th year1723,785 110.47
1 EPIC's projection, as contained in the record is difficult to read and this
amount may differ from the projection.
By instrument dated December 22, 1982, EPIC assigned
to EA 83-XII EPIC's "right, title and interest" in the
purchase and leaseback agreement with Raldon. On
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