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Intro to Prop Management Final

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Debt service consists of A. principal, interest, and taxes. B. principal and interest. C. principal, interest, taxes, and insurance. D. interest.

Which housing type would most likely be concerned with the "Basic Allowance for Housing?" A. Senior Housing B. Military Housing C. Subsidized Housing D. Student Housing

Which law protects against discrimination in the sale or rental of housing, based on protected classes (ex. race)? A. Equal Opportunity to Housing Act B. Fair Housing Act C. Landlord Tenant Act D. Right to Housing Act

When referring to investing, the term "liquidity" refers to ____________? A. how safe or risky the investment is B. the amount of cash "flowing" from the investment C. how leveraged the investment is D. how easily/quickly the investment can be converted to cash

Which governing document instructs condominium owners about which maintenance items are covered collectively and which are the responsibility of the individual owners? A. Declaration B. Deed C. Mortgage D. Bylaws

TRUE or FALSE: Building classifications are absolute. A Class A office building in one city, will be a Class A office building in any city.

TRUE or FALSE: It is acceptable to charge a higher rent amount for a 2-bedroom unit occupied by a family of four vs. the same 2-bedroom unit occupied by a couple.

TRUE or FALSE: It is considered discrimination and federally illegal if private landlords reject an applicant with a Section 8 Housing Choice Voucher.

TRUE or FALSE: It is considered illegal discrimination if landlords reject an applicant with a Section 8 Housing Choice Voucher.

TRUE or FALSE: Like condominiums, cooperative owners hold an individual deed to their unit which grants them occupancy rights.

True or False: The capitalization rate for a property will fluctuate depending on if and how the property was financed.

True or False: The tenant is often referred to as the "lessor" in the lease agreement.

True or False: When offering concessions, the textbook recommends reducing the base rent each month instead of offering one-time free rent.

True or False: When using the capitalization rate to calculate a property's value, the analysis can be done with either monthly or annual figures for NOI.

A retail tenant is required to pay a minimum rent. If their gross sales exceed a predetermined amount, they can be responsible for additional rent. This best describes a(n) ____________________.

%age lease

A retail strip center is purchased for $4,400,000. A loan is used with a 60% loan to value. The annual NOI for the property is $385,000. The annual debt service is $167,000. What is the cash-on-cash return for this property?

12.4%

A commercial tenant is looking to lease a 12,500 sf space. The base rent is $14/sf/year. The owner offers a concession to reduce the rent by $1/sf/year for the first year of a five year lease. What is the effective rent for this lease?

13.80

A resident is offered half off of their first month's rent if they sign an 18-month lease at $1,200/month. What is the effective rent for this lease?

1,166.67

A tenant leases space with a usable area of 25,000 sf, but pays rent based on 30,500 sf to cover their share of common areas of the building. What is this unit's "R/U ratio?"

1.22

A property with 131 units that rent at $1,078/month has annual operating expenses equaling $762,577. An effective manager identifies ways to responsibly reduce expenses by 3% a year. At a cap rate of 7.5%, the manager would have increased the property's value by ___________________. A. $305,031 B. $22,877 C. $361,253 D. $218,954

A. 762577 -3% -------- 22,877/7.5%=305,031

4. A commercial real estate investor shares with you that cap rates in the local market have been falling over the past year. Which of the following statements can best be assumed? A. Investors are proportionately paying more for the income potential of commercial real estate. B. Investors are considering the market riskier than in the past. C. Vacancy rates are decreasing in the market. D. Net operating incomes are rising in the market.

A. Investors are proportionately paying more for the income potential of commercial real estate.

Which law protects against discrimination in the sale or rental of housing, based on protected classes (ex. race)?

Fair Housing Act

Banks consider properties with up to ______ units as residential properties, eligible for special owner-occupied financing options. A. three B. four C. two D. five

An employer's failure to act in a reasonably prudent manner, such as performing background checks on all new employees, may lead to accusations of ______________ regarding the employer's behavior.

negligence

Neighborhood A has a cap rate of 5.4% for Class B four-plexes. Neighborhood B has a cap rate of 6.2% for Class B four-plexes. In which neighborhood are buyers/investor willing to pay a higher price for $1 of net operating income? A. Neighborhood A B. Investors are willing to pay an equal amount. C. Neighborhood B D. Cannot be determined from the information provided.

neighborhood a

Neighborhood A has a cap rate of 7.4% for Class B four-plexes. Neighborhood B has a cap rate of 6.8% for Class B four-plexes. In which neighborhood are buyers/investor willing to pay a higher price for $1 of net operating income? A. Neighborhood B B. Neighborhood A C. Cannot be determined from the information provided. D. Investors are willing to pay an equal amount.

neighborhood b value=noi/cap rate

The formula for calculating the capitalization rate is

net operating income divided by value.

The general formula for a capitalization rate is __________________.

net operating income divided by value.

In a principal-agent relationship, the agent is the real estate manager and the principal is the owner.

TRUE OR FALSE: Commercial real estate is often valued using the Income Capitalization Approach. In this approach, when a higher cap rate is applied, it will result in a lower value.

TRUE or FALSE: A building with a lower "R/U ratio" will likely cost the tenant less per square foot of usable area.

TRUE or FALSE: Condominium revenue comes almost entirely from assessments to members (owners of units) and is budgeted to meet expenses and reserves.

TRUE or FALSE: Condominium units are individually assessed and taxed for property taxes, not the building as a whole.

TRUE or FALSE: If the parties negotiate an artificial breakpoint that is lower than the natural breakpoint, it will be beneficial for the landlord?

TRUE or FALSE: In performing a comparison grid analysis, a real estate manager adjusts the rent of a comparable property upward if a feature of the comparable property is inferior to the same feature in the subject property.

A tenant leases 3,100 sf of usable space with an "R/U ratio" of 1.08 at $2.25/sf/mo. What would their monthly rent be?

$7,533

A manager proposes to install motion sensors for common area lights to reduce their use when no one is around. The upgrade reduces the electric bill by $2,500 over the course of the year. If the cap rate for this building 6.5%, how much value did this improvement add?

$38,462

A five-plex generates $5,000/mo in rent and pays $2,300/mo in operating expenses. Investors have recently purchased comparable buildings, and considering the risk and income potential and the prices they paid, the average return on investment for a cash purchase is 7.25%. What should we expect this property to be valued at in this marketplace?

$446,897

property with 310 units that rent at $1,648/month has annual operating expenses equaling $2,758,000. An effective manager identifies ways to responsibly reduce expenses by 1.5% a year. At a cap rate of 6.2%, the manager would have increased the property's value by ___________________.

$667,258

What write-off is a noncash expense that considers the useful life of an asset?

. Depreciation

At which point in the business cycle would you least likely see rental concessions?

. Development

. No, the net benefit does not outweigh the costs.

Which of the following is least likely to be "Other Income" for a residential property?

. Operating Expense Chargebacks

A triplex is listed at $425,000 and generates $4,500/mo in rent. A fourplex is listed at $515,000 and generates $4,900/mo in rent. Which property has a more favorable gross rent multiplier (GRM)?

. The triplex has a more favorable GRM because it would take fewer months of rent to equal the sale price.

An investor owns a vacant lot next to their apartment building. The manager proposes doing some site work and gravel, installing a fence, and adding some security cameras of the area at a cost of $68,000. The lot could then be marketed as overflow parking or vehicle storage for campers, boats, and RVs at a cost of $75/mo/space. The finished lot would have 30 spaces, and the manager expects 70% occupancy. The market cap rate for this property is 7.5%. What is the best analysis of this project?

. This was a good investment because it increased value by $252,000.

This concentration of density and larger buildings may define this city's ______________________.

. central business district (CBD)

Unlike condominium managers, apartment managers are responsible for maintaining

. occupancy levels

All of the following are considered additional revenue EXCEPT

. pet deposits.

A manager decides to forego some preventive maintenance procedures, deferring $35,000 of expenses over the course of a year. At a cap rate of 7%, this manager increased the building's value by

A manager of 468,000 square foot medical office building recommends renovating the building's common areas and main lobby. Local bids indicate that the improvements would cost $1.2 million to complete. The manager states that the aesthetic upgrades would increase average rents by $0.20/sf/month. What would the payback period be for this recommendation? 13mo

13mo

A marketing campaign costs $5,500. It attracts 37 people to inquire about the property and results in 6 new lease agreements. What is the marketing cost per prospect?

148.65

A marketing campaign costs $5,500. It attracts 37 people to inquire about the property and results in 6 new lease agreements. What is the conversion ratio from prospects to leases?

16.2

A lead-based paint disclosure is necessary for any housing built prior to

1978

A 56-unit mid-rise apartment building was constructed on a 1.3 acre parcel of land. What is the density for this construction?

43 u/acre

At the beginning of the year, the residential housing market had 9,200 vacancies. 100 newly developed units hit the market each quarter of the year. At the end of the year, the market had 8,950 vacancies. What was the absorption rate for this market?

650

When a new commercial lease is signed, the tenant is responsible for operating expense increases over the base year. The base year was $350,000 of operating expenses for the building. The tenant is leasing 12,000 ft of a 48,000 sf building. At the end of the year, the operating expenses totaled $380,000. How much would the tenant be responsible for?

7,500

7. Which of the following would not be considered income-producing real estate? A. A condominium collecting dues for common area maintenance B. A mini-storage facility renting storage space to families and businesses C. A retail strip mall with only three tenants D. An owner-occupied duplex leasing out one side

According to your textbook, the major demand for real estate management expertise arose in what era? A. The Great Depression B. Feudalism C. The Post-War Boom D. The Great Recession

At the beginning of the year, the residential housing market had 24,500 vacancies. 500 newly developed units hit the market each quarter of the year. At the end of the year, the market had 25,250 vacancies. What was the absorption rate for this market? A. 1250 B. -750 C. 1500 D. 2000

The value (expected sale price) of an income-producing real estate asset can be determined using the income capitalization approach. What formula does this approach use to determine value? A. Annual NOI / Cap Rate B. Cash Flow / Initial Investment C. Cap Rate / Annual NOI D. Cap Rate / Cash Flow

Which line item best measures the profitability of an income-producing real estate asset. A. Net Operating Income B. Effective Gross Income C. Before-Tax Cash Flow D. Gross Potential Income

Which position will most likely have the strongest voice in retention or disposition of property? A. Asset Manager B. Leasing Agent C. Building Engineer D. Property Manager

A commercial office building is purchased for $8,000,000. A loan is used with a 75% loan to value. The annual NOI for the property is $750,000. The annual debt service is $500,000. What is the cash-on-cash return for this property? A. 12.5% B. 3.1% C. 9.4% D. 9%

A $/$%=btcf/investment =250,000/$2mil=12.5

Which of the following would not be considered income-producing real estate?

A condominium collecting dues for common area maintenance

What is the capitalization rate?

A measure for relating an asset's value to its projected income and risk

ow are the Consumer Price Index (CPI) and rent related?

As the CPI rises, rents would be expected to rise as well.

A real estate investor has a loan on a commercial asset. The loan payments are calculated based on a 20-year term, but at the end of seven years, the remaining principal balance will be due to the lender. What kind of loan product is this?

Balloon Loan

Which of the following is not a primary responsibility of real estate managers?

Buying and selling real property for owners

All of the following should be goals of the professional property manager EXCEPT A. maximize the operating income of the property. B. maintain or improve the value of the property. C. maintain 100% occupancy. D. accomplish the objectives of the owner.

Which of the following is the correct formula for calculating a real estate asset's cap rate?

Cap Rate = Annual NOI / Value

8. The textbook largely defines income-producing real estate under what two subcategories? A. Vacant and Developed B. Agricultural and Industrial C. Retail and Office D. Residential and Commercial

Of utmost importance, property managers are directly responsible for maintaining and creating value in properties. This is done by improving the ___________ of a property, which results from optimizing rental and other income to the property and minimizing operating expenses. A. cash flow B. leasing C. gross rents D. net operating income

Which of the following is NOT an "Operating Expense?" A. Management Fees B. Property Taxes C. Utilities D. Debt Service

D. debt services

The Landlord Tenant Act establishes criteria like _______________.

D. the limits, use, and distribution requirements for a residential security deposit.

Government influence on interest rates has the greatest, most direct effect on what part of real estate economics?

Debt Service

What tax deduction is a noncash expense that considers the useful life of an asset?

Depreciation

Which of the following laws requires credit bureaus to supply information to a person who has been denied credit?

Fair Credit Reporting Act

Fidelity bond

A commercial real estate investor shares with you that cap rates in the local market have been falling over the past year. Which of the following statements can best be assumed?

Investors are proportionately paying more for the income potential of commercial real estate.

The use of borrowed money to purchase an asset is called ____________

Mortgage

Of utmost importance, property managers are directly responsible for maintaining and creating value in properties. This is done by improving the ___________ of a property, which results from optimizing rental and other income to the property and minimizing operating expenses. A. net operating income B. leasing C. cash flow D. gross rents

NOI

he value (expected sale price) of an income-producing real estate asset can be determined using the income capitalization approach. What formula does this approach use to determine value?

NOI/cap rate

Neighborhood XYZ has a cap rate of 8.6% for Class C office buildings. Neighborhood ABC has a cap rate of 9.5% for Class C office buildings. In which neighborhood are buyers/investor willing to pay a higher price for each $1 of net operating income?

Neighborhood XYZ

Which document spells out the conditions of the loan repayment, including the interest rate, term, and payment schedule.

Promissory note

A financial analysis indicates that a $150,000 renovation to an apartment building would increase net operating income by $4,500 a month. If the market cap rate for this type of property was 8%, how would the property's value be affected?

Property value would increase by $675,000

If the monthly collection from condominium owners is not enough to pay for a repair or improvement, a/an __________________ may be levied to cover the expense.

SPECIAL assessment

According to your textbook, the major demand for real estate management expertise arose in what era?

The Great Depression

Which of the following factors is LEAST LIKELY to influence the number of staff and their level of specialization regarding real estate management?

The neighborhood in which the properties are located

Real estate cycles tend to exceed the heights of the peaks and the depths of the troughs of the general economic cycle.

True

The following building is a ____________.

Unable to tell from the information provided

___________: The actual physical area within the rented premises in which the tenant will operate and have exclusive control and possession.

Usable Area

23. How are the Consumer Price Index (CPI) and rent related? A. As the CPI rises, rents would be expected to rise as well. B. As the CPI rises, interested rates would be expected to fall, thus rents would rise. C. The CPI measures inflation and has no relation to rent. D. As the CPI falls, rents would be expected to rise.

5. The process of repayment of a real estate loan is best classified as ___________. A. debt service B. PITI C. leverage D. interest payments

8. The general formula for a capitalization rate is A. net operating income divided by value. B. effective gross income divided by a rate. C. net operating income divided by a rate. D. potential gross income divided by value.

A 200-unit apartment community has a net operating income of $650,000. At an 8% cap rate, the property would be valued at $8,125,000. Through effective brand management, resident satisfaction, and strong curb appeal the real estate manager is able to increase average leased rents by $10/unit/mo. The new value calculated would be ___________. A. $8,425,000 B. $8,325,000 C. $8,149,000 D. $8,150,000

A lead-based paint disclosure is necessary for any housing built prior to ___________. A. 1978 B. 1968 C. 1988 D. 1938

A lease specifies that the tenant is responsible for a fixed monthly rent amount plus the electric and gas utilities. The remaining expenses for the property are the responsibility of the owner. This best describes a(n) _______________. A. gross lease B. escalation clause C. net lease D. option

A manager notices that his residents are very "pet-friendly" and believes that the addition of a dog park on the property would help retain good residents, attract new prospects, and potentially increase rents. After receiving bids, he builds the park for $40,000. Over the next year, the net operating income for the property increases by $10,000. Assume the cap rate for this property 8%. Which of the following is the best analysis. A. This was a good investment because it increased the value of the property by $125,000. B. This was a bad investment because they did not recoup the original $40,000. C. This was a bad investment because the return on investment is too low. D. This was a good investment because it increased resident retention.

A manager recommends replacing all light bulbs at the property with energy-efficient LED bulbs. The bulbs are $5 each and the property would require 450 bulbs plus $3,500 in labor costs to install them. The manager states that the energy saved would be roughly $250 each month. What would the payback period be for this recommendation? A. 23 months B. 9 months C. 31 months D. 14 months

A retail tenant's lease (3,600 rsf) stipulates a percentage rent rate of 4% with a base rent of $15/SF/YR. What is the monthly sales natural breakpoint for this lease? A. $112,500 B. $143,895 C. $188,542 D. $1,350,000

Bending Birch Apartments contains 3-story buildings, spread over seven acres in the suburbs of a local city. What apartment type would best describe this property? A. A garden apartment B. A low-rise apartment C. A walkup apartment D. A mid-rise apartment

Cycles of the general business economy differ from the real estate cycles in that the ____________. A. trends in real estate lag behind trends in the general economy. B. real estate market is not subject to seasonal variants. C. general business economy is usually subject to more extreme oversupply and undersupply. D. general business economy can be affected by government decisions.

Failure to separate funds, such as operating funds and trust funds, is known as __________. A. commingling B. embezzlement C. collusion D. forgery

Failure to separate funds, such as operating funds and trust funds, is known as __________. A. commingling B. forgery C. embezzlement D. collusion

LEED Certification is a measure of _____________. A. a building's sustainability practices in its design and operation. B. a manager's education and experience level operating medical office buildings (MOBs). C. a city's ability to attract and retain businesses and jobs. D. a building's profitability relative to other buildings in its class.

The CPI is a common index used to measure _________. A. inflation B. domestic production C. wages D. rental rates

The calculation of a repayment of a loan, including both principal and interest payments, is better termed _________________. A. amortization B. pass-through C. expense reimbursement D. rebasement

The real estate manager's compensation for duties performed under a management agreement is most commonly referred to as _____________. A. the management fee. B. the salary or wage. C. the service commissions. D. the scope of pay.

The standard for building measurement was developed by _______________. A. BOMA B. NAA C. IREM D. HUD

When a unit within an apartment community is being used as a leasing office and is unavailable to rent, this would best be classified as _______________. A. economic vacancy loss B. physical vacancy loss C. rental collection loss D. rental concession loss

Which is a unique characteristic of a real estate investment trust (REIT)? A. 95% of its taxable income must be distributed to shareholders. B. No more than 75 shareholders are allowed. C. Income taxes are paid at the entity level and the shareholder level. D. Investor liability is unlimited.

Which law protects against discrimination in the sale or rental of housing, based on protected classes (ex. race)? A. Fair Housing Act B. Landlord Tenant Act C. Right to Housing Act D. Equal Opportunity to Housing Act

Which of the following would put negative pressures on rental rates? A. A new development breaks ground, adding new rental options for tenants. B. The city purchases a vacant shopping center and converts it into a school. C. The local authority lowers sales taxes. D. Employee wages begin rising at a faster rate.

A manager notices that his residents are very "pet-friendly" and believes that the addition of a dog park on the property would help retain good residents, attract new prospects, and potentially increase rents. After receiving bids, he builds the park for $40,000. Over the next year, the net operating income for the property increases by $10,000. Assume the cap rate for this property 8%. Which of the following is the best analysis. A. This was a good investment because it increased the value of the property by $125,000. B. This was a bad investment because the return on investment is too low. C. This was a bad investment because they did not recoup the original $40,000. D. This was a good investment because it increased resident retention.

a 10000/.08

a 14x12,500=700,000 13x12,500=162,500 162,500/(862,500/5) =172,500/12,500=13.80

24. A five-plex generates $5,000/mo in rent and pays $2,300/mo in operating expenses. Investors have recently purchased comparable buildings, and considering the risk and income potential and the prices they paid, the average return on investment for a cash purchase is 7.25%. What should we expect this property to be valued at in this marketplace? A. $446,897 B. $827,586 C. $621,489 D. $234,900

a noi/cap rate=value (5,000-2,300)/2700(12)

LEED Certification is a measure of _____________.

a building's sustainability practices in its design and operation

An individual with the following duties would best be classified as ______________________. Interacting with prospective residents and tenants, serving as the initial contact for those seeking rental space and providing tours of the property.

a leasing agent

he calculation of a repayment of a loan, including both principal and interest payments, is better termed _________________.

amortization

12. An agent with a requirement to provide loyalty, care, and disclosure to the principal is best identified as a/an _________. A. manager B. fiduciary C. independent contractor D. trustor

17. An analysis of the general economic climate, a property's operations and competition, and strategy recommendations in line with the owner's goals defines the ______________. A. market analysis. B. management plan. C. lease agreement. D. management agreement.

25. A retail tenant's lease (3,600 rsf) stipulates a percentage rent rate of 4% with a base rent of $15/SF/YR and an artificial breakpoint of $100,000. If gross sales for the month were $132,000, what would the tenant's rent payment be? A. $1,280 B. $5,780 C. $4,500 D. $5,280

25. Which of the following is a characteristic effecting the demand of rental housing in Anchorage? A. Building materials and labor are expensive B. Population is declining across the city C. Vacant, buildable land is limited D. Building codes and permitting process for construction is burdensome

A property with 131 units that rent at $1,078/month has annual operating expenses equaling $762,577. At a cap rate of 7.5%, the property should be valued at ______. A. $10,167,693 B. $12,427,187 C. $7,658,644 D. $1,694,616

A real estate investor hires a real estate management company to manage their assets. What would be purchased to protect the investor from dishonest acts of the management company and its employees regarding the handling of the investor's money? A. Liability insurance B. Fidelity bond C. Employment practices liability insurance D. Rent loss insurance

A triplex is listed at $425,000 and generates $4,500/mo in rent. A fourplex is listed at $515,000 and generates $4,900/mo in rent. Which property has a more favorable gross rent multiplier (GRM)? A. The fourplex has a more favorable GRM because higher density buildings will always produce a higher GRM. B. The triplex has a more favorable GRM because it would take fewer months of rent to equal the sale price. C. The triplex has a more favorable GRM because proportionately you are paying more for each dollar of rent. D. The fourplex has a more favorable GRM because it is higher than the GRM for the triplex.

All of the following are considered additional revenue EXCEPT A. storage rents. B. pet deposits. C. laundry commissions. D. parking fees.

An account where money is regularly set aside to pay future expenses like capital expenditures is best referred to as a ____________. A. trust fund B. reserve fund C. operating fund D. investment fund

At which point in the real estate cycle would you least likely see rental concessions? A. The real estate cycle and rent concessions are not related. B. Development C. Stabilization D. Adjustment

During negotiations for a commercial lease, the tenant expresses concerns about the construction costs needed to transform the space to fit their business. If the owner is willing, what would be the most appropriate concession to offer for this scenario? A. Shorter lease term with option to renew B. Tenant improvement allowance C. Base rent reduction D. Cap on pass-through charges

Investments in equipment or long-term rehabilitation that increases the useful life of the property is best referred to as _____________. A. debt service B. capital improvements C. depreciation D. operating expenses

One of the most effective ways to identify current real estate rental rates and trends affecting your property is to _________. A. consult national statistics provided by the U.S. Census Bureau. B. survey and compare similar properties in the area. C. attend annual economy forecast luncheons provided by local associations. D. look at the unemployment rate for the state.

Residential leases are typically ____________. A. percentage leases B. gross leases C. net leases D. triple net leases

The Landlord Tenant Act establishes criteria like _______________. A. the construction code requirements for tenant improvements. B. the limits, use, and distribution requirements for a residential security deposit. C. the process for evicting a tenant from a retail space. D. a commercial owner's responsibilities to maintain the property.

The ________ has primary responsibility for the tangible asset, which the property represents, and focuses on managing the physical property - overseeing the day-to-day operations and site personnel. A. management company executive B. site manager C. regional manager D. asset manager

The ratio of a property's cash flow to the owner's cash input is known as A. a break-even point. B. cash-on-cash return. C. the capital gain ratio. D. the capitalization rate.

Under HUD Section 8 housing, _____________. A. eligibility is based on national limits for income, consistently applied throughout the U.S. B. rent is subsidized based on the resident's income. C. the resident gets housing at no cost. D. the resident pays up to 45% of his or her adjusted monthly income toward rent.

Unlike condominium managers, apartment managers are responsible for maintaining _______________. A. curb appeal. B. occupancy levels. C. common areas. D. monetary collections and administrative functions.

What institution aims to control the supply of money in the economy by adjusting interest rates? A. The Security and Exchange Commission B. The Federal Reserve C. The US Treasury D. The Department of Housing and Urban Development

What is the best term to describe unoccupied office space that does not have partition walls, ceiling tiles, electrical, or wall coverings? A. Vacant space B. Shell space C. Gross space D. Vanilla shell space

Which are potentially more challenging due to inherent management inefficiencies? A. Walkup apartments B. Scattered site housing C. Garden apartment communities D. Mixed-use properties

Which of the following is not a primary responsibility of real estate managers? A. Preparing maintenance plans for an asset B. Buying and selling real property for owners C. Hiring and evaluating management personnel D. Preparing and monitoring operating budgets

Which of the following is not an operating expenses? A. Payroll B. Vacancy loss C. Painting supplies D. Utilities

Which of the following would not be considered income-producing real estate? . A mini-storage facility renting storage space to families and businesses B. A retail strip mall with only three tenants C. A condominium collecting dues for common area maintenance D. An owner-occupied duplex leasing out one side

Which residential property type would you expect to be most "liquid?" A. 100+ Unit Garden Apartment Buildings B. Single-family houses C. Luxury High-Rise Apartment Buildings D. Plexes (Duplex, Triplex, Fourplex, etc.)

_____________: The actual physical area within the rented premises in which the tenant will operate and have exclusive control and possession. A. Gross Area B. Usable Area C. Rentable Area D. Assignable Area

At the beginning of the year, the residential housing market had 1,300 vacancies. A 200-unit community opened in the first quarter of the year, and 75 additional units were added throughout the summer and fall. At the end of the year, the market had 1,350 vacancies. What was the absorption rate for this market? A. -50 B. 225 C. -275 D. 325

b 13000 +200 +75 -1350 -------- 225 OR 1575 -1350 ----- 225

A marketing campaign costs $5,500. It attracts 37 people to inquire about the property and results in 6 new lease agreements. What is the conversion ratio from prospects to leases? A. 26.6% B. 16.2% C. 61.7% D. 6.7%

b 6/27=16.2%

A commercial office building is purchased for $2,000,000. A loan is used with a 75% loan to value. The annual NOI for the property is $120,000. The annual debt service is $75,000. What is the cash-on-cash return for this property? A. 2.25% B. 9% C. 8.5% D. 6%

b 9% $/$%=BTCF/down payment=45k/500k

The standard for building measurement was developed by _______________.

boma

Which governing document instructs condominium owners about which maintenance items are covered collectively and which are the responsibility of the individual owners?

bylaws

10. What is the usual starting point for the Management Plan? A. Conduct an analysis of the investment's competition. B. Propose property alternatives and recommendations. C. Define the owner's goals for the investment. D. Prepare a regional and neighborhood analysis.

15. The regular monthly assessments for HOA dues should include funding for the reserve account to fund long-range planning of __________________. A. operating expenditures B. management fees C. capital expenditures D. marketing expenditures

22. At which point in the real estate cycle would you least likely see rental concessions? A. Stabilization B. Adjustment C. Development D. The real estate cycle and rent concessions are not related.

23. A commercial office building is purchased for $8,000,000. A loan is used with a 75% loan to value. The annual NOI for the property is $750,000. The annual debt service is $500,000. Should the investor buy this property with a loan or with cash? A. Cash - because it avoids interest charges B. Leveraged - because it requires a lower down payment C. Leveraged - because the ROI is higher D. Cash - because the ROI is higher

A 12-month projection of on-going income and expenses for each month for a property best describes a/an ____________. A. capital budget B. income statement C. operating budget D. long-range pro forma

A 12-month projection of on-going income and expenses for each month for a property best describes a/an ____________. A. income statement B. capital budget C. operating budget D. long-range pro forma

A four-plex property is not individually metered for water, so the property receives one water bill. The owner pays this bill and charges 25% of the bill back to each of the units every month. When the residents pay their pro-rata share, this would be recorded on the income statement under which line item? A. Operating expenses: utilities B. Operating expenses: maintenance C. Expense reimbursements D. Other income

A lower cap rate should indicate A. nothing, cap rates do not relate to risk. B. either higher or lower risk depending on the property value. C. lower risk. D. higher risk.

A property with 20 units that rent at $1,200/month has annual operating expenses equaling $120,900. A effective manager identifies ways to responsibly reduce expenses by $14,500 a year. At a cap rate of 9%, the manager would have increased the property's value by ______________. A. $14,500 B. $67,858 C. $161,111 D. $174,000

A real estate manager spends $750 on a marketing project to lease a vacant apartment. The marketing effort led to the apartment being leased at $975, and is suspected to have saved 15 days of vacancy. Was this marketing effort an effective decision? A. Yes, the net benefit results in greater NOI for the property. B. No, all marketing efforts only reduce NOI C. No, the net benefit does not outweigh the costs. D. Financial effectiveness cannot be determined from the information provided.

A resident is offered half off of their first month's rent if they sign an 18-month lease at $1,200/month. What is the effective rent for this lease? A. $1,200.00/mo B. $1,133.33/mo C. $1,166.67/mo D. $1,150.00/mo

The ratio of a property's cash flow to the owner's cash input is known as ________________.

cash-on-cash return.

An analysis of the general economic climate, a property's operations and competition, and strategy recommendations in line with the owner's goals defines the ______________. A. market analysis. B. management plan. C. management agreement. D. lease agreement.

An employer's failure to act in a reasonably prudent manner, such as performing background checks on all new employees, may lead to accusations of ______________ regarding the employer's behavior. A. discrimination B. fraud C. negligence D. retaliation

Condominium managers are primarily concerned with ___________. A. effectively turning units to reduce vacancy loss. B. negotiating profitable rental leases. C. maintaining or improving the value of the property. D. generating the greatest net operating income for their owners.

Cycles of the general business economy differ from the real estate cycles in that the A. real estate market is not subject to seasonal variants. B. general business economy can be affected by government decisions. C. trends in real estate lag behind trends in the general economy. D. general business economy is usually subject to more extreme oversupply and undersupply.

Gross potential income (GPI) is calculated as A. 100% occupancy at leased rent price B. Revenue collected after accounting for other income and expense reimbursements C. 100% occupancy at market rent price D. Revenue collected after accounting for vacancy loss and loss/gain to lease

Residential properties includes spaces where ___________. A. people sell goods B. people store items C. people live D. people manufacture and assemble goods

The document containing the company's policies and procedures and employee benefits best defines the _______________. A. offer letter. B. job description. C. employee manual. D. performance assessment.

The real estate manager's compensation for duties performed under a management agreement is most commonly referred to as _____________. A. the service commissions. B. the scope of pay. C. the management fee. D. the salary or wage.

Unlike condominium managers, apartment managers are responsible for maintaining ___________. A. common areas. B. curb appeal. C. occupancy levels. D. monetary collections and administrative functions.

What is the capitalization rate? A. Number used to determine the return on your leveraged cash investment. B. A number usually figured at 8% for investment properties C. A measure for relating an asset's value to its projected income and risk D. The ratio of the appraised value of the property to other competing properties

What is the capitalization rate? A. The ratio of the appraised value of the property to other competing properties B. A number usually figured at 8% for investment properties C. A measure for relating an asset's value to its projected income and risk D. Number used to determine the return on your leveraged cash investment.

What term best describes the diminishing of a building's value because it's design no longer meets current demands for physical use and/or would require extensive retrofitting costs to meet market needs. A. Building Load Factor B. Deterioration C. Functional Obsolescence D. Depreciation

Which is a combination of home ownership and homesite rental? A. Cooperatives B. Planned Unit Developments C. Manufactured home community D. Condominiums

Which law protects employees and applicants from discrimination in the hiring and employment process? A. Fair Labor Standards Act (FLSA) B. Fair Housing Act (FHA) C. Civil Rights Act D. Federal Unemployment Tax Act (FUTA)

Which law requires that sex offenders register their address with law enforcement? A. Equal Credit Opportunity Act B. Fair Credit Reporting Act C. Megan's Law D. Fair Housing Act

Which of the following is NOT an "Operating Expense?" A. Management Fees B. Utilities C. Capital Expenditures D. Property Taxes

A manager decides to forego some preventive maintenance procedures, deferring $15,000 of expenses over the course of a year. At a cap rate of 7%, this manager increased the building's value by A. $1,050 B. $214,286 C. $0 D. $15,000

c ("deffering" you're just not doing it. if anything, youd pay less for this prop.)

A triplex is listed at $425,000 and generates $4,500/mo in rent. A fourplex is listed at $515,000 and generates $4,900/mo in rent. Which property has a more favorable gross rent multiplier (GRM)? A. The fourplex has a more favorable GRM because it is higher than the GRM for the triplex. B. The triplex has a more favorable GRM because proportionately you are paying more for each dollar of rent. C. The triplex has a more favorable GRM because it would take fewer months of rent to equal the sale price. D. The fourplex has a more favorable GRM because higher density buildings will always produce a higher GRM.

c 515k/4900=105 months GRM=425k/4500=94 months of rent to sale price

A manager recommends replacing all light bulbs at the property with energy-efficient LED bulbs. The bulbs are $5 each and the property would require 450 bulbs plus $3,500 in labor costs to install them. The manager states that the energy saved would be roughly $250 each month. Roughly how much would the improvement increase the property's value (not including the original costs) if the market's cap rate was 6.5%? A. $3,000 B. $19,500 C. $46,000 D. $0

c value=annual noi/cap rate 3000/6.5%=46000

2. In City A, a property that generates an annual NOI of $25,000 a year will sell for $250,000. In City B, a property that generates an annual NOI of $25,000 a year will sell for $300,000. Which city has a higher cap rate? A. City B B. The cap rates are the same for both cities C. City A D. Can not calculate from the information given

c. city A (NOI/value)

The following property is a/an _______________________.

cant be determined

he regular monthly assessments for HOA dues should include funding for the reserve account to fund long-range planning of __________________.

capital expenditures

In City A, a property that generates an annual NOI of $25,000 a year will sell for $250,000. In City B, a property that generates an annual NOI of $25,000 a year will sell for $300,000. In which city are investors signaling that investing in real estate is more risky? A. City B B. The risk assessment is the same for both cities C. Can not calculate from the information given D. City A

city A (higher rates=higher risks)

In City A, a property that generates an annual NOI of $125,000 a year will sell for $1,250,000. In City B, a property that generates an annual NOI of $125,000 a year will sell for $1,000,000. In which city are investors signaling that investing in real estate is more risky? A. The risk assessment is the same for both cities B. Can not calculate from the information given C. City B D. City A

city b

In City A, a property that generates an annual NOI of $320,000 a year will sell for $4,280,000. In City B, a property that generates an annual NOI of $320,000 a year will sell for $3,790,000. In which city are investors signaling that investing in real estate is more risky?

city b

Which law protects employees and applicants from discrimination in the hiring and employment process?

civil rights act

A flat management fee arrangement would be MOST appropriate when managing a(n) _______________.

condominium community.

16. Why might a principal prefer that the management fee be a percentage of Effective Gross Income (EGI) instead of Gross Potential Income (GPI)? A. They wouldn't prefer this arrangement, compensation would always be higher when applied to EGI. B. It ties the manager's compensation to performance that includes management of operating expenses. C. The compensation amount will always be lower we applied to EGI. D. It ties the manager's compensation to performance that includes vacancy control and other income collection.

24. Which of the following would put negative pressures on rental rates? A. The local authority lowers sales taxes. B. The city purchases a vacant shopping center and converts it into a school. C. Employee wages begin rising at a faster rate. D. A retail chain closes multiple stores across the city, vacating their leases.

7. What write-off is a noncash expense that considers the useful life of an asset? A. Property Insurance B. Maintenance & Repairs C. Property Taxes D. Depreciation

9. What is the document that defines the duties and responsibilities of the owner and the real estate manager, establishing their business relationship. A. Lease Agreement B. Trust Agreement C. Management Plan D. Management Agreement

A worker that is eligible to receive overtime pay for hours worked in excess of daily or weekly maximums best defines a non-exempt employee.

A 200-unit apartment community has a net operating income of $650,000. At an 8% cap rate, the property would be valued at _______________. A. $5,200,000 B. $10,400,000 C. $3,825,000 D. $8,125,000

A 56-unit mid-rise apartment building was constructed on a 1.3 acre parcel of land. What is the density for this construction? A. 43% B. 73 units-per-acre C. 2.3% D. 43 units-per-acre

A marketing campaign costs $5,500. It attracts 37 people to inquire about the property and results in 6 new lease agreements. What is the marketing cost per prospect? A. $5,500 B. $127.91 C. $916.67 D. $148.65

A property with 20 units that rent at $1,200/month has annual operating expenses equaling $120,900. At a cap rate of 9%, the property should be valued at __________. A. $133,333. B. $1,600,000. C. $3,066,666. D. $1,856,667

A tenant leases space with a usable area of 25,000 sf, but pays rent based on 30,500 sf to cover their share of common areas of the building. What is this unit's "R/U ratio?" A. .82 B. 1.82 C. .22 D. 1.22

An employer's failure to act in a reasonably prudent manner, such as performing background checks on all new employees, may lead to accusations of ______________ regarding the employer's behavior. A. fraud B. discrimination C. retaliation D. negligence

If the monthly collection from condominium owners is not enough to pay for a repair or improvement, a/an __________________ may be levied to cover the expense. A. "fee for common elements" B. expense reimbursement C. ownership tax D. special assessment

The value (expected sale price) of an income-producing real estate asset can be determined using the income capitalization approach. What formula does this approach use to determine value? A. Cap Rate / Cash Flow B. Cap Rate / NOI C. Cash Flow / Cap Rate D. NOI / Cap Rate

True or False: Internal promotion of an employee is not recommended because it creates a need to train two positions instead of one, increasing operating costs.

What institution aims to control the supply of money in the economy by adjusting interest rates? A. The Department of Housing and Urban Development B. The Security and Exchange Commission C. The US Treasury D. The Federal Reserve

What is the document that defines the duties and responsibilities of the owner and the real estate manager, establishing their business relationship? A. Management Plan B. Trust Agreement C. Lease Agreement D. Management Agreement

When identifying your target market, which of the following is not one of the four determining factors identified by the textbook? A. Size of the rental space B. Rental price C. Location D. Zoning

Which housing type is most likely to rent "by-the-bed?" A. Military Housing B. Senior Housing C. Conventional Housing D. Student Housing

Which law protects employees and applicants from discrimination in the hiring and employment process? A. Fair Housing Act (FHA) B. Federal Unemployment Tax Act (FUTA) C. Fair Labor Standards Act (FLSA) D. Civil Rights Act

Which of the following factors is LEAST LIKELY to influence the number of staff and their level of specialization regarding real estate management? A. The size of property and tenancy type owned/managed B. The type of property owned/management (ex. retail vs. residential) C. The number of properties owned/managed by the employer D. The neighborhood in which the properties owned/managed are located

Which of the following is least likely to be "Other Income" for a residential property? A. Pet Rent and Fees B. Parking and Storage Rent C. Late Fees and Damage Chargebacks D. Operating Expense Chargebacks

Which of the following laws requires credit bureaus to supply information to a person who has been denied credit? A. Sherman Antitrust Law B. Equal Credit Opportunity Act C. Civil Rights Act of 1968 D. Fair Credit Reporting Act

Which of the following would least likely be part of a "Property Analysis?" A. A review of building amenities B. An analysis of operating costs C. An analysis of unit types D. A review of major employers in the city

Which of the following would not impact the calculation of debt service? A. Loan to value percentage B. Interest rates C. Loan term length D. Leased rental rates

A tenant leases 3,100 sf of usable space with an "R/U ratio" of 1.08 at $2.25/sf/mo. What would their monthly rent be? A. $6,975 B. $5,683 C. $6,458 D. $7,533

d 3100*1.08=3348 sf * 2.25= 7533

A manager of 320-unit, garden-style apartment community recommends installing a dog park for its residents. Local bids indicate that the park would could $33,750 to install fencing, equipment, and landscaping. The manager states that the new amenity would increase average rents by $5/month/unit. What would the payback period be for this recommendation? A. 31 months B. 2 months C. 26 months D. 21 months

d 5*320=1600 33750/1650=~21 months

A commercial real estate investor shares with you that cap rates in the local market have been rising over the past year. Which of the following statements can best be assumed? A. Vacancy rates are increasing in the market. B. Net operating incomes are falling in the market. C. Investors are considering the market less risky than in the past. D. Investors are proportionately paying less for the income potential of commercial real estate.

d cap rate increases, not/value decreases?

A financial analysis indicates that a $50,000 renovation to an apartment building would increase net operating income by $1,200 a month. If the market cap rate for this type of property was 6.5%, how would the property's value be affected? A. Property value would increase by $50,000 B. Property value would increase by $64,400 C. Property value would decrease by $35,600 D. Property value would increase by $221,538

d (value=annual noi/cap rate) -> 14,400/6.5%

The payment for a real estate loan is best classified as ___________.

debt service

Which of the following is NOT an "Operating Expense?"

debt service

The document containing the company's policies and procedures and employee benefits best defines the _______________.

empee manual

. TRUE or FALSE: The smaller the community, the more likely it offers recreational facilities such as swimming pools, tennis courts, patios, exercise rooms, etc.

11. TRUE or FALSE: In a principal-agent relationship, the principal is the real estate manager.

A building with a lower "R/U ratio" will likely cost the tenant more per square foot of usable area.

A general partnership is better than a sole proprietorship because the owners' liability is reduced by the number of owners in the partnership.

A real estate asset that appreciates in value over time is well-defined as an "income-producing property."

A real estate investor buys a tract of vacant land for $50,000. Ten years later, the investor sells the land for $100,000. True or False: This a good example of "income-producing real estate?"

At will employment protects employers' rights to terminate an employee for any reason without potential for recourse.

Condominiums are a construction style for residential buildings, characterized by shared walls and parking areas.

Hiring in-house employees will always result in cost savings compared to contracted labor or outsourcing.

Internal promotion of an employee is not recommended because it creates a need to train two positions instead of one, increasing operating costs.

Management fees are always some percentage of revenue collected or gross potential income.

RUE or FALSE: The smaller the community, the more likely it offers recreational facilities such as swimming pools, tennis courts, patios, exercise rooms, etc.

TRUE or FALSE: A commercial leasing agent should avoid discussing the current tenants of a building during the marketing process, to avoid claims of discrimination.

TRUE or FALSE: A property investor runs the numbers on an income-producing asset and identifies that the cap rate calculates at 7.5% and cash-on-cash return equals 8.6%. If the investor is seeking the highest percentage return on investment, they should purchase this property with cash and avoid a loan.

TRUE or FALSE: A property that strictly enforces a "no pet policy" may deny an applicant with an emotional support animal (assistance animal).

TRUE or FALSE: A worker that is eligible to receive overtime pay for hours worked in excess of daily or weekly maximums best defines an exempt employee.

TRUE or FALSE: Advances in technology has led to manufacturers requiring more inventory on-hand and consequently more spatial needs.

TRUE or FALSE: After-tax cash flow refers to the owner's dollar return after paying property taxes.

TRUE or FALSE: Because commercial properties involve more expensive rental space, they often require more elaborate model units and finishes to attract potential tenants.

TRUE or FALSE: Residential leases are usually individually negotiated and unique. One property is likely to have several varying lease agreements, with unique terms, clauses, and tenant obligations for each of its tenants.

TRUE or FALSE: Section 8 vouchers allow low-income renters to receive subsidized housing at a tax credit property, but cannot be used in the private market.

TRUE or FALSE: Section 8 vouchers are in place to allow low-income renters to rent housing at a property that has been subsidized through tax credits.

TRUE or FALSE: The "building out" of a space to suit the needs of a tenant is a costly upfront expense that the owner must pay to secure a long-term tenant.

TRUE or FALSE: The property owner's insurance against physical damage protects the building structures, interiors, and resident's items.

TRUE or FALSE: The property owner's insurance against physical damage protects the building structures, interiors, and residents' items.

TRUE or FALSE: Unlike residential tenants, commercial tenants do not require applications or qualifying procedures.

TRUE or FALSE: Warehouses and self-storage facilities generally fall under the "retail property" classification.

True or False: At will employment protects employers' rights to terminate an employee for any reason without potential for recourse.

True or False: Because commercial properties involve more expensive rental space, they often require more elaborate model units and finishes to attract potential tenants.

True or False: Hiring in-house employees will always result in cost savings compared to contracted labor or outsourcing.

True or False: Income taxes are considered an "operating expense."

True or False: Residential leases will often contain escalation clauses due to their term length and the unpredictable nature of inflation and expenses.

t/f: If an investor can afford to purchase a property with cash, they should because it will always produce a higher return on investment than using borrowed money.

t/f: The day-to-day responsibilities of an individual with the job title, "Property Manager," will be the same across companies and types of real estate.

t/f: The residential real estate market typically lags further behind the commercial real estate market.

t/f: A building with a lower "R/U ratio" will likely cost the tenant more per square foot of usable area.

f ex. 100*1.1=1100 sf x$1= $1100/1000 usf=$1.10 BUT 1000*1.2=1200/1000usf= $1.20 per usable sqaure feet

TRUE or FALSE: A commercial leasing agent should avoid discussing the current tenants of a building during the marketing process, to avoid claims of discrimination.

f in residential, its true. in commercial, not true.

TRUE or FALSE: The capitalization rate for a property will fluctuate depending on if and how the property was financed.

false

t/f: A general partnership is better than a sole proprietorship because the owners' liability is reduced by the number of owners in the partnership.

false

Banks consider properties with up to ______ units as residential properties, eligible for special owner-occupied financing options.

four

An agent with a requirement to provide loyalty, care, and disclosure to the principal is best identified as a/an _________.fudiciary

fudiciary

functional obsolecences

Bending Birch Apartments contains 3-story buildings, spread over seven acres in the suburbs of a local city. What apartment type would best describe this property?

garden apt

gross

Residential leases are typically ____________.

gross

A higher cap rate should indicate _________________.

higher risk

When referring to investing, the term "liquidity" refers to ____________.

how easily/quickly the investment can be converted to cash

All of the following should be goals of the professional property manager EXCEPT ___________.

maintain 100% occupancy

Condominium managers are primarily concerned with

maintaining or improving the value of the property

An analysis of the general economic climate, a property's operations and competition, and strategy recommendations in line with the owner's goals defines the ______________.

management plan.

Which is a combination of home ownership and homesite rental?

manufactured home community

Which law requires that sex offenders register their address with law enforcement

megans law

What is the document that defines the duties and responsibilities of the owner and the real estate manager, establishing their business relationship?

mgmt agreement

Which housing type would most likely be concerned with the "Basic Allowance for Housing?"

military housing

The textbook states that "perhaps the most challenging property to manage is a/an ___________________ development"

mixed-use

The following image is an example of a _______________.

monument

noi

Residential properties include spaces where ___________.

people live

Debt service consists of ______________.

principal and interest.

What are the four stages of the general business economy cycle -- as defined in the textbook and lecture?

recovery, prosperity, recession, and depression

Under HUD Section 8 housing,

rent is subsidized based on the resident's income.

An account where money is regularly set aside to pay future expenses like capital improvements is best referred to as a ____________.

reserve fund

Shopping centers, factory outlets, and super regional malls are examples of ________________.

retail properties

Which are potentially more challenging due to inherent management inefficiencies?

scattered site housign

What is the best term to describe unoccupied office space that does not have partition walls, ceiling tiles, electrical, or wall coverings?

shell space

Which residential property type would you expect to be most "liquid?"

single family houses

The ________ has primary responsibility for the tangible asset, which the property represents, and focuses on managing the physical property - overseeing the day-to-day operations.

site manager

Ethical conduct refers to _____________.

socially or culturally imposed rules of conduct that go beyond the letter of the law.

Which housing type is most likely to rent "by-the-bed?"

student housing

TRUE or FALSE: It is acceptable to charge a different security deposit amount for an applicant that has a poor credit history.

TRUE or FALSE: It is acceptable to charge a higher rent amount for a third floor unit than a first floor unit.

TRUE or FALSE: More so than with commercial properties, residential tenants have an emotional as well as a monetary value attached to their rented space.

TRUE or FALSE: Property taxes are considered an "Operating Expense."

TRUE or FALSE: The "condominium" ownership structure is not only a residential term. Office condominiums are a real estate option for businesses.

TRUE or FALSE: Unlike residential properties, which are usually marketed on personal and emotional appeal, the marketing emphasis for commercial space is usually on the dollar value the prospect will receive for the rent paid.

TRUE or FALSE: When a resident's lease comes up for renewal, concessions to upgrade or improve the space is a better is a preferred strategy for the owner than giving a monetary concession.

TRUE or FALSE: When a resident's lease comes up for renewal, concessions to upgrade or improve the space is a preferred strategy for the owner versus giving an equal monetary concession.

TRUE or FALSE: When negotiating a lease, base rent for a triple-net lease would likely be lower than base rent for a single-net lease.

True or False: A worker that is eligible to receive overtime pay for hours worked in excess of daily or weekly maximums best defines a non-exempt employee.

True or False: Real estate leasing and sales commissions, for both sides of the transaction, are generally paid by the owner of the property.

True or False: When negotiating a lease, base rent for a triple-net lease would likely be lower than base rent for a single-net lease.

t/f: When supply is less than demand, prices tend to rise; when supply exceeds demand, prices tend to fall.

TRUE OR FALSE: Commercial real estate is often valued using the Income Capitalization Approach. In this approach, when a higher cap rate is applied, it will result in a lower value.

t value=noi/cap =100000/10%=$1mil 100000/5%=2mil

tenant improvement allowance

Cycles of the general business economy differ from those of the real estate market in that the _______________.

trends in real estate lag behind trends in the general economy.

When identifying your target market, which of the following is not one of the four determining factors identified by the textbook?

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