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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 year 3405798 5.94
End of 3d year 3755078 7.36
End of 4th year 4094090 7.77
EPIC's analysis of the transaction included a
computation of the rental deficit contribution. First,
EPIC personnel estimated the monthly deficit from the
project, $22,235, taking into account estimated monthly
operating expenses of $54,696, tenant rentals of $22,860
(with a vacancy rate of 11.1 percent), and a monthly
contribution of investor capital of $12,138. According
to the analysis, the present value of the monthly deficit,
$22,235, discounted over 36 months at 13 percent, is
$659,929. The analysis, which is reproduced below,
designates this amount as the rental deficit contribution:
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