Transaction Example

150,000 sf MOB with 225 car parking

(all dollars in millions)

 

 

 

Cost to Construct ($475/rsf)

Year one rent (based on a 9.5% yield)

Sale @ 6.0 CAP at CO

Projected Net

 

 

 

$        71.25

$          6.77

$      112.80

$        41.55

 

Land (12 ac x $500k/)

Development Fee (6.0%)

Distributions (25/75 split)

Operating Income/

Return to Time of Sale

Return on Equity

Proceeds of Sale

TOTAL

 

 

Development Splits and Other Proceeds

(Including land and DF, a part of base cost)

 

 

 

Institution

 $ 6.25

                 0

           

 

0.50

             1.60

             8.38

        $ 16.73

 

 

Partners

 0

4.25

       

 

 1.15

             4.81

           25.14

     $ 35.35

 

 

Total

 $ 6.25

       4.25

   

   

1.65

            6.41

          33.50

       $ 52.08

 

 

422% Total return on equity over 5 years,

equal to 85% annually

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