Real Estate Math

A Delaware commercial property has 8,000 sq ft of space rented at $22/sq ft/year with a 5% annual escalation. What will the annual rent be in Year 2?

A$184,800✓ Correct
B$176,000
C$193,600
D$179,200

Explanation

Year 1 Rent = 8,000 sq ft × $22 = $176,000. Year 2 Rent = $176,000 × 1.05 = $184,800. To solve this, multiply the relevant values: $22 at 5%.. The correct answer is $184,800.. This is a common calculation on the Delaware real estate exam.

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