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www.MerrittProperties.comPRO FORMA OPTION 1
Option 1: Speculative Building - no value to mezz.
10/24/2014
Square Footage:
36,168
Glover Building - 221 Cockeysville Road
Investment Analysis
Inputs:
Notes:
Purchase Price
64.97
$
- Purchase of a 36,168 SF Building
Rent: Tenant TBD
7.75
$
26,168
- Existing Tenant In Building paying $4.25 on 10,000 SF
Rent: Marathon Roofing
4.25
$
10,000
- Building Costs include:
Cap Rate:
8.00%
New Roof:
170,000
4.70
$
LTV:
70%
Sprinkler:
150,000
4.15
$
Interest Rate:
5.70%
Demo 5,000 SF office
30,000
0.83
$
Add W/H TI
50,000
1.38
$
Tenant Improvements:
3.82
$
26,168
Exterior
50,000
1.38
$
Total:
450,000
12.44
$
- 36 Parking Spaces
Proforma Income Statement
Gross
PSF
Development Costs
Gross
PSF
Rental Income:
245,302
6.78
$
Purchase Price
2,350,000
64.97
Operating Expenses:
83,186
2.30
Design and Development
-
-
Less Vacany (5%)
(12,265)
(0.34)
Sitework
-
-
Total Income:
316,223
8.74
Building Improvements
450,000
12.44
Finance and Legal (1.25%)
25,488
0.70
Construction Carry
-
-
Operating Expenses:
Lease up Carry
85,046
3.25
Property Taxes
36,168
1.00
Contingency
-
-
Insurance
3,617
0.10
Utilities
21,701
0.60
Subtotal
2,910,534
80.47
Maintenance
21,701
0.60
Management Fee (4%)
12,649
0.35
Tenant Improvements:
100,000
2.76
Subtotal:
83,186
2.30
Commissions (4%)
63,000
1.74
Net Operating Income:
233,037
6.44
Total Development Costs
3,073,534
84.98
Financial Analysis:
Cap Rate
8.00%
Value
2,912,961
80.54
Proposed LTV
70%
Proposed Debt
2,039,073
56.38
Interest Rate
5.70%
Period
25
Debt Service
(153,197)
(4.24)
Cash Flow:
79,840
2.21
Return on Costs
7.58%
Equity Required
1,034,462
Return on Equity
7.72%
Equity Created
(160,573)