Property Valuation
The capitalization rate for an Oklahoma office building is determined primarily by:
AThe state's assessment ratio
BMarket data from comparable sales divided by their NOI; it reflects investor return expectations, risk, and market conditions at a point in time✓ Correct
CThe property tax millage rate
DOREC's published rate tables
Explanation
Market-derived capitalization rates are extracted from comparable sales by dividing each property's NOI by its sale price. The resulting rate reflects what investors in that specific market demand as a return for that type and quality of property at current market conditions.
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