The properties were acquired for $54,100,000 at an acquisition cap rate of 6.11%, with total acquisition costs including reserves totaling $57,965,871.
Valuation ladder
Acquisition price$54.10M
Offering price$64.77M+19.7%
Cap rate spread & load
Acquisition cap rate6.11%
Upfront load (all-equity)9.50%equity = offering price
Load net of reserves7.64%
Acquisition Price
$54,100,000
Offering Price
$64,766,336
Appraised Value
—
Upfront Load
—
Load on Equity
—
Load on Offering Price
9.5%
Acquisition Cap Rate
6.11%
Syndicated Cap Rate
—
Premium / Discount
—
Appraisal / Offering %
—
Less Reserves %
—
Strengths
- Acquisition cap rate of 6.11% provides stable initial yield basis
- $1,854,800 funded upfront for reserves
Concerns
- Acquisition fee of $1,630,500 adds to net purchase basis