Uyen Nguyen

2
A. Total rentable area = gross area common area interior era
300,000 45,000 30,000 = 225,000sqft
B. We have:
7th floor load factor = rentable /usable = 28,000/25,000 = 1.12
7th floor common area = rentable usable = 28,000 25,000 = 3,000
C. Tenant rentable area = 5,000 * 1.12 = 5,600 sq
Total rent cost = $30*5,600 = $168,000
D. From A, total rentable area is 225,000 sqft.
7th floor total rentable and common area = 225,000 + 30,000 = 255,000
7th load factor = 1.12 * 255,000 / 225,000 = 1.27
Tenant rentable area = 5,000 * 1.27 = 6,350
E. The total rent for the incoming year = 6,350sq * $30 * 12 months =
$228,600,000

3
A. The $24 in rents per sqft combined with the move in allowance and Tis is
justified because it is a better proposal rent per sqft compare to ACMEs one.
(i.e., better in effective rent)
For ACME proposal, with total rentable area of 20,000 sq.

Year
Year
Year
Year
Year

Net Rent
$20
$21
$22
$23
$24

1
2
3
4
5
Average rent = $22

Present value = ($20/1.10)+($21/1.102)+($22/1.103)+($23/1.104)+

($24/1.105) = $82.68
Effective rent
PV = $82.68, I/Y=10, N = 5, FV = 0, PMT = $21.81
For Atrium proposal, with total rentable area of 20,000 sq.

Uyen Nguyen

Year
Year
Year
Year
Year

Net Rent
$24
$25
$26
$27
$28

1
2
3
4
5
Average rent = $26

Present value = ($24/1.10)+($25/1.102)+($26/1.103)+($27/1.104)+

($28/1.10 ) = $97.8
5

Effective rent = $23.83

PV = $97.8, I/Y=10, N = 5, FV = 0, PMT = $23.83
B. No, Atrium should NOT agree to the lease buyout or agree to the lease at $24
per square foot with the move-in allowance and Tis, because
Year
Year
Year
Year
Year

Net Rent
$23 - $15 = $8
$24
$25
$26
$27

1
2
3
4
5

Present value = ($8/1.10)+($24/1.102)+($25/1.103)+($26/1.104)+

($27/1.105) = $80.41
Effective rent = $21.21
PV = $80.41, I/Y=10, N = 5, FV = 0, PMT = $21.21
4.
Total area = 2.8million sqft
Anchor tenant renting area = 800,000sq ($3 per sqft)
In line tenants occupy = 1.3million sqft
Common area = (2.8 million 1.3million 0.8million)sq = 700,000sq
Total maintenance cost = 700,000sq* $8 = $5,600,000
CAM = $5,600,000/1.3million sq = $4.31 per sq