Question 5.

Given the information provided earlier, you are asked to make recommendations on: (1) whether the owner should sell this property now or wait for two years; (2) whether she need to renovate the building to get a better price in two years. In completing this task, you SHOULD make your own assumptions if the information given above is insufficient.

(1) Create a table in a spreadsheet and copy the table here. Build on the table you created in Question 4. Prepare a 2-year forecast of income and expenses for Spring Heights Apartments (from 01/01/2022 to 31/12/2023). Ensure that the table includes estimates of NOI, BTCF, and ATCF. Explain the process of your calculation briefly. Write down the formulas if necessary.

(2) Without calculation or creating a spreadsheet model, explain the steps in making a recommendation to the owner on whether she should dispose the property now or wait for another two years. If you strongly prefer, you could use a spreadsheet table to demonstrate it. But it is not requested.  Some information to answer this question is not given. You must fill in the gaps yourself and indicate the information you need to collect.

(3) Without calculation or creating a spreadsheet model, explain the steps in making a recommendation to the owner on whether she should renovate the property. Some information is not given. If you strongly prefer, you could use a spreadsheet table to demonstrate it. But it is not requested.  Some information to answer this question is not given. You must fill in the gaps yourself and indicate the information you need to collect.