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Homework: REITs and RE Investment Performance Assignment

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Problem 21-1

TOSHIBA

You have been presented with the following set of financial statements for National Property Trust, a REIT that is about to make an

initial stock offering to the public. This REIT specializes in the acquisition and management of warehouses. Your firm, Blue Street

asked to prepare a financial analysis of the REIT.

Advisors, is an investment management company that is considering the purchase of National Property Trust shares. You have been

National Property Trust

Panel A. Operating Statement Summary

Net revenue

Less:

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Interest expense*

Net income (loss)

*At 8% interest only.

Operating expenses

Depreciation and amortization

General and administrative expenses

Management expense

Income from operations

Less:

vo.

DID VOID

OID VO

Panel B. Balance Sheet Summary

Assets

Cash

Rents receivable

Properties @ cost

Less: Accumulated depreciation

Properties-net

Total net assets

Short term

Mortgage debt*

Total

Shareholder equityt

Type here to search

Liabilities

Total liabilities and equity

"At 8% interest only.

110,000,000 shares outstanding.

VOILL

$ 119,000,000

Al

47,600,000

41,000,000

7,900,000

4,900,000

17,600,000

6,400,000

$ 11, 200,000

$ 53,400,000

4,400,000

890,000,000

469,000,000

421,000,000

$ 478,800,000

Required:

National Property Trust with other REITS.

a. Develop a set of financial ratios that will provide Blue Street Advisors with useful information in the evaluation and d comparison of

b. Your research also indicates that the shares of comparable REITS specializing in warehouse acquisitions in the same regions are

selling at dividend yields in the range of 8 percent. Price multiples for these REITS are about 12 current FFO. What price range does

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$ 167,800,000

80,000,000

247,800,000

231,000,000

$ 478,800,000

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Homework: REITS and RE Investment Performance Assignment

1

5

points

eBook

Print

References

Mc

Appraisa x annotate X LU Homewo X M Question X M Sign In X Adrian W x

ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%25

Mortgage debt*

Total

Shareholder equityt

Total liabilities and equity

*At 8% interest only.

†10,000,000 shares outstanding.

Required:

a. Develop a set of financial ratios that will provide Blue Street Advisors with useful information in the evaluation and comparison of

National Property Trust with other REITs.

TOSHIBA

b. Your research also indicates that the shares of comparable REITs specializing in warehouse acquisitions in the same regions are

this suggest for National shares?

selling at dividend yields in the range of 8 percent. Price multiples for these REITs are about 12 current FFO. What price range does

properties owned by Blue Street Advisors?

c. What is the NAV for National Property Trust assuming that a blended capitalization rate of 10 percent would be applicable for the

vo.

ID VID

Complete this question by entering your answers in the tabs below.

Required A Required B

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EPS

NOI

FFO

ROC

Cash Retention per Share

Net Assets per Share

Equity or Book Value per Share

ROA

ROE

Required C

Develop a set of financial ratios that will provide Blue Street Advisors with useful information in the evaluation and

comparison of National Property Trust with other REITS. (Round your intermediate calculations and final answers to 2 decimal

places. Negative values should be indicated by a minus sign. ROA and ROE should be entered as percentages.)

VOIR VU

$

80,000,000

247,800,000

231,000,000

$ 478,800,000

2.03

%

%

Required A

Af

Required B >

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Prav

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