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Can you please help me calculate a potential single-tenant property investment using the DCF model...

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Question

Finance

Can you please help me calculate a potential single-tenant property investment using the DCF model in Excel.

Please show calculations for 10 year holding period. STEP BY STEP

Data:

Initial Property value: $350,000

Operating income

Current monthly annual rent: $20,160 ($420 per week) ($1680 monthly rent)

Projected Annual rent Growth: 5%

Vacancy rate: 2.9%

Operating Expenses (Annual):

Property taxes: $1,800 per annum

Insurance costs: $1,200 per annum

Property Management fees: 6% of rental income

Maintenance and repair $1,500 per annum

Utilities: $2,200per annum

Capital Expenditures (Annual): Estimated CapEx: $2,000 (for regular upkeep and replacements)

Financing:

Loan Amount: $200,000

Interest Rate: 6.9%

Loan Term: 30 years

Closing Costs: $2,000

Market Assumptions:

Discount Rate: 8%

Terminal Cap Rate: 6%

Holding Period: 10 years

Property Sale Costs: 6% of the selling price

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