NVI Technical College Information

I NCOME C APITALIZATION A PPROACH 62

A total vacancy loss for the subject property of 10.0% is projected. We also estimate a nominal level of collection loss of 1.0%. Given the unique nature of the subject and its design as a technical school, this estimate is reasonable. This equates to a 12-month vacancy over a 10-year lease term or 6-months over a 5-year term. C OMPARABLE E XPENSE D ATA Each of the respective expense items is projected in consideration of actual historical operations and market data. The following table summarizes the expenses from other industrial properties. Although an attempt was made to categorize expenses on a similar basis to the subject, the nature of the raw data prevented such in some categories, especially with regard to the level of detail. The management fee for a property is typically based upon a percentage of the EGI, which is denoted separately.

EXPENSE COMPARABLES

Comparable No. State

1

2

3

Northeast

Northeast

Northeast

Year Built

1975

1952

1952

Rentable Area Year Operations

60511

21000

49900

2021

2021

2020

INCOME

Amount

$/SF

% EGI

Amount

$/SF

% EGI

Amount

$/SF

% EGI

INCOME EXPENSES Real Estate Taxes

$36,205 $0.60 $18,153 $0.30 $95,243 $1.57 $17,274 $0.29

$11,219 $0.53 $1,420 $0.07

$55,988 $1.12 $5,498 $0.11 $62,874 $1.26 $4,499 $0.09

Insurance

CAM

$0 $0.00 $0 $0.00 $0 $0.00

Management

7%

---

---

Replacement Reserves

$0 $0.00

$0 $0.00

Total Expenses

$166,875

$2.76

66%

$12,639

$0.60

---

$128,859

$2.58

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O PERATING E XPENSE A NALYSIS AND P ROJECTIONS Typically, the best source of information to estimate pro forma operations for the property is the actual historical performance of the subject. However, this data was not provided to the appraiser. Each of the respective expense items is estimated in the following analysis with consideration given to comparable expense data from the local market.

IREM INCOME/EXPENSE ANALYSIS: SUBURBAN OFFICE 2019

Expense

Low $1.53 $0.11 $3.25 $0.45

High $3.73 $0.25 $6.92 $0.88

Median

Real Estate Taxes

$2.38 $0.16 $5.03 $0.66

Insurance

CAM

Management

Replacement Reserves

---

---

---

Total

$5.99

$10.70

$8.31

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