Real Estate Math
A NJ office building with 20,000 net rentable square feet is 85% occupied. Monthly rent is $22 per square foot annually. What is the monthly base rent collected?
A$31,167✓ Correct
B$28,333
C$37,000
D$26,492
Explanation
Occupied sq ft = 20,000 × 0.85 = 17,000.
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Key Terms to Know
Gross Rent Multiplier (GRM)
A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
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