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Required Rate of Return on real estate investment.
Dear All,
How would you calculate the required rate of return for a special purpose vehicle which buys real estate (with 90% debt) and lends it to the government ("certain cash flows") and guaranties the maintenance of the building.
* Leveraging industry betas would give a distorted result, as the SPV is extremely geared.
* Lease/rent payments divided by the property values of similar projects would be a potential solution, but each project is unique, so it's difficult to compare/find data
* Any suggestions ?
* Could you suggest pa
 one year ago
 one year ago
Required Rate of Return on real estate investment. Dear All, How would you calculate the required rate of return for a special purpose vehicle which buys real estate (with 90% debt) and lends it to the government ("certain cash flows") and guaranties the maintenance of the building. * Leveraging industry betas would give a distorted result, as the SPV is extremely geared. * Lease/rent payments divided by the property values of similar projects would be a potential solution, but each project is unique, so it's difficult to compare/find data * Any suggestions ? * Could you suggest pa
 one year ago
 one year ago

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