A building with a purchase price of $20,000,000 is expected to generate an NOI of $1,750,000 for each of the next five years and can be resold at the end of the fifth year for $21,000,000. The purchase will be financed by a $12,000,000 interest only loan with yearly payments of $720,000. What is the levered IRR of the investment?
a. 14.2%
b. 11.7%
c. 13.9%
d. 12.8%
e. 14.7%
Option E. 14.7%
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