教了几天书，商学院案例分析。

Class Project 1

Acquisition Decision of a Multifamily Building

 

            In 2010, China Investment Fund was looking for an investment property. One multifamily building was listed in August 2010. The basic information of the building includes

1. Rentable area 10500 and 16 units, divided into (1) three-bedroom apt; (5) two-bedroom apts; (8) one-bedroom apts and (2) studio. The rent roll is summarized in the following table.

Unit	09/10	10/10	11/10	12/10	01/11	02/11	03/11		04/11
2	Previous Owner	Damaged		Construction
3		225	325	325	325	325	325		325
4		425	425	425	425	425	425		450
5		425	425	425	425	465	495
6A		Damaged		Construction					450
6B		Damaged		Construction			350		350
7		repair	450	450	450		450		450
8		Damaged		Construction				213	425
9		Eviction				repair			550
10		300	450	450	450	450	450		450
11		300	325	325	325	325	325		325
12A		Damaged		Construction
12B		Damaged		Construction			350		350
13		repair	650	745	650	975	650
14		repair	450	450	450	450	450		450
15		325	325	325	325	325	325		325
16		325	163	325	325	325	325		325
17		350	350	350	350	350	350		350
Laundry									13.5
Total	2625	2675	4338	4595	4500	4865	5483		5588

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2. It was noted that only units 3, 4, 5, 9, 10, 11, 15 and 17 was rented. Units 2, 6A, 6B, 7, 8, 12A, 12B, 13, 14, 15 were vacant. Among them, units 2, 6A, 6B, 7, 8, 12A, 12B, 13, 14 were not habitable and unit 15 needs minor repair. All units would be renovated if the property were acquired.
3. Also Unit 9 was to be evicted due to not paying rent; however, this was not known during the acquisition
4. The property tax data for 2010 was $131 per month.
5. Utilities: gas paid by the landlord averagely $450/month; water by landlord averagely $300/month; trash by landlord $101/month; outside lighting by landlord was about $60/month.
6. National average repairs for MFH was $60/month/unit. Considering the age of the building (1893), the repair could be 50% more than average
7. One tenant came up and said he would do the snow removal and lawn care and trash picking up for exchange of $100 in rent deduction.
8. There was an existing loan from Wells Fargo that the buyer could assume. The loan had 12.5 years left and interest rate was 8.5% with a balance of $200,000. (hint: Use excel function PMT(rate, nper, pv, [fv], [type]) to calculate monthly loan payment)
9. The seller agreed to carry a wrap-around loan of $84,000 at 6.5% with a 30 year amortization.
10. Seller's insurance could also be assumed for $215/month.
11. The management fee for the area is usually 8% of the rent collected.
12. The sale price was $375,000.

If you were the acquisition manager for CIF, would you make the purchase?

所有跟帖： 

• Class Project 1 Demo -- September 2010 -sweetptt- ♂ (5339 bytes) () 11/03/2015 postreply 22:01:41

• Class Project 1 Demo -- Projection of 2011 -sweetptt- ♂ (8173 bytes) () 11/03/2015 postreply 22:03:44

• Class Project 1 Demo -- Proforma (2011 data) -sweetptt- ♂ (14646 bytes) () 11/03/2015 postreply 22:07:42

• You can assume rent up 5% and value up 7%. -meowi- ♀ (0 bytes) () 11/03/2015 postreply 22:47:16

• I mean you can not assume. Our area rent has been same for 5 yr -meowi- ♀ (0 bytes) () 11/03/2015 postreply 22:48:49

• 你的课名称：real estate? -3apples- ♀ (0 bytes) () 11/04/2015 postreply 06:09:20

• 赞 -happylittlewoman- ♀ (0 bytes) () 11/04/2015 postreply 06:38:18

• 赞署老爷的苦口婆心，水平不是一般高。 -610016- ♀ (0 bytes) () 11/04/2015 postreply 08:12:30

• 一看就不是老师出身。 -Morning3evening4- ♂ (163 bytes) () 11/04/2015 postreply 10:10:40

• 7，这种水平分分钟误人子弟啊！ -youxi88- ♀ (0 bytes) () 11/04/2015 postreply 15:57:54

• MD，每天好心情都被你搅和了。 -sweetptt- ♂ (0 bytes) () 11/05/2015 postreply 01:06:26