Sheet1Bank Loan:Annual Cah FlowsIRR & NPV Analysis

Cost of building($5,950,000)Gross rental income$493,068YearCash FlowPV factorPVInterest Rate10%0($2,513,067)1.0000($2,513,067)Loan Period25Total gross income$493,0681$264,2340.9091$240,213Less general vacancy/credit looses2$264,2340.8264$218,375Monthly Loan Payment$54,067.69(3.48% of total gross income)$17,1903$264,2340.7513$198,523Gross operating income$475,8784$264,2340.6830$180,4755$264,2340.6209$164,069Asumptions:Less operating expenses6$264,2340.5645$149,153Insurance$7,3497$264,2340.5132$135,5941- Cost of the appartment is $5,950,000Maintenance$21,2758$264,2340.4665$123,267Manager salary$14,7189$264,2340.4241$112,0612- Time period for analysis is 10 yearsOther Expenses$141,92910$264,2340.3855$101,8743- Bank laon interest rate is assumed to be 10%Total operating expenses($185,271)11$264,2340.3505$92,6124- Loan period is 25 yearsNet operating income$290,60712$264,2340.3186$84,193Less debt financing$26,37313$264,2340.2897$76,53914$264,2340.2633$69,581Net cash flow$264,23415$264,2340.2394$63,256NPV($503,282)IRR6.32%