Real Estate Math
A Massachusetts investor purchases a triple-net (NNN) commercial property for $1,200,000 at a 6% cap rate. The annual NOI is:
A$60,000
B$72,000✓ Correct
C$80,000
D$90,000
Explanation
NOI = Purchase Price × Cap Rate = $1,200,000 × 6% = $72,000. In a triple-net lease, the tenant pays property taxes, insurance, and maintenance, so the NOI closely approximates the owner's cash income.
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