Epic Associates 84-III, William C. Griffith, Jr. - Page 94




                                       - 21 -                                         
             Operating expenses per month                          $7,961             
             Tenant rental revenue                                 -4,600             
             Rent-up factor                                        0.883              
             Net tenant rental                                     -4,062             
             Operating deficit                                     3,899              
             Investor contribution                                                    
             purchase price                  $449,500     x     0.004      –1,798     
             Net monthly deficit                                   2,101              
             Present value of deficit                                                 
             over 36 mos. at 13%                                                      
             monthly deficit of                  2,101x    29.68    62,364 [sic]       
             Rental deficit contribution                           62,364             
             As a percent of purchase price                     0.1387408             

             The rental deficit contribution shown above was calculated using a net   
             borrowing cost, exclusive of servicing and private mortgage insurance    
             of 16.75 percent.                                                        

             The rental deficit contribution computed in the above                    
             analysis, $62,364, differs from the amount used in EPIC's                
             cash-flow analysis for the project, $69,190, and differs                 
             from the rental deficit contribution finally negotiated                  
             with Fox & Jacobs, $67,643.                                              
                  By instrument dated December 21, 1982, EPIC assigned                
             to EA 83-XII "its entire right, title and interest, as                   
             purchaser and landlord" in the rental purchase agree-                    
             ment dated December 18, 1982, with Fox & Jacobs.  On                     
             December 30, 1982, EA 83-XII closed the purchase of each                 
             of the properties.                                                       
                  To finance its purchase of the subject properties,                  
             EA 83-XII borrowed approximately 95 percent of the purchase              
             price of each of the properties from EMI.  On the closing                
             date, EA 83-XII executed seven nonrecourse promissory                    





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