contestada

1. A REIT has an NOI of $15 per share. It paid a dividend of $10 per share last year
. The dividend is projected
to increase by 4 percent this year and continue to increase by 4 percent per year thereafter. Assuming that
the blended cap rate is 9.75 percent and the required rate of return is 10.5 percent, what would the net
asset value (NAV) per share of the REIT be if total liabilities are $40,000 and there are 1,000 shares
outstanding?

Respuesta :

anthougo

The net asset value per share of the REIT would be $105.71.

Data and Calculations:

Net operating income (NOI) = $15 per share

Outstanding number of shares = 1,000

Total liabilities = $40,000

REIT's blended cap rate = 9.75%

REIT's required rate of return = 10.5%

The total net operating income (NOI) for the year = $15,000 ($15 x 1,000).

The annual interest expense on debts = $3,900 ($40,000 x 9.75%).

The net income after interest (EBT) = $11,100 ($15,000 - $3,900).

The Net asset value = $105,714 (11,100/10.5%).

Thus, the net asset value per share of the REIT would be $105.71.

Learn more about the net asset value (NAV) here: https://brainly.com/question/1377416

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