BUSI 422 Read & Interact Brueggeman & Fisher Chapter 16 solutions complete answers

BUSI 422 Read & Interact Brueggeman & Fisher Chapter 16 solutions complete answers

 

Pro forma is another term for _______.

 

True or false: Permanent financing replaces construction financing.

 

If the before tax rate of return exceeds the discount rate, the NPV ______.

 

Predevelopment lease commitments ______

 

In general, lenders on a construction project will ______.

 

LIBOR stands for _________.

 

True or false: Construction lenders may provide funds in excess of costs of the property to cover improvement costs that are planned but not yet made to the property if the improvements will increase the property's value.

 

The greater the spatial proximity to other sites in an urban area, the ______ the value of the site.

 

True or false: Financing project development always requires a single loan rather than multiple loans.

 

A developer needs to get a loan to finance the construction of a building and site improvements. Assuming the developer already owns the land, what type of loan should he/she get?

 

True or false: If a permit is denied, the application could end up before city council for a vote on whether or not to approve the project.

 

development is the process of financing the acquisition of a tract of land with the intent of constructing a building, leasing, managing and the possible sale of the completed project.

 

The        process begins with an application that identifies the site, its location, and a preliminary design of the improvements to be constructed.

 

A loan used to acquire land, as well as constructed a building and other site improvements is referred to as a       .

 

Developers can reduce risk by: (select all that apply).

 

As the price of land       , the        likely it is to be densely developed.

 

Upon completion of the project, the developer may replace the construction loan with        financing.

 

At the end of the stabilization period a developer must: (select all that apply).

 

Lenders use         to ensure that work has been satisfactorily completed and so that developers don’t draw down funds at a faster rate than they must pay to contractors.

 

Soft costs include: (Select all that apply).

 

A determination of whether a project is commercially feasible at prevailing market rents, land prices and construction and financing costs is referred to as a        analysis.

 

In many cases lenders prefer to make loans to cover improvement costs and expect the developer to contribute        as equity.

 

True or false: Interest rates on construction loans are generally based on short term interest rates that are fixed from period to period.

 

The most commonly used method to disburse funds for commercial development is the        draw method.

 

A property is stabilized when it reaches        .

 

Hard costs include: (Select all that apply).

 

When developers estimate reimbursable expenses per square foot for a fully leased property in order to recover some costs from tenants who occupy a portion of the developed space during lease up, it is referred to as        up expenses.

 

Which of the following is not generally submitted to lenders by developers as part of a loan request?

 

Developers consider a project to be at greatest risk when:

 

If a developer makes interest only payments on a construction loan, the interest carry does NOT become part of the loan balance.

 

Market risk begins with        acquisition

 

A developer needs to get a loan to finance the construction of a building and site improvements.    Assuming the developer already owns the land, what type of loan should he/she get?

 

The process of financing the acquisition of a tract of land with the intent of constructing a building, leasing, managing and the possible sale of the completed project is known as:

 

If a project is successful, the developer creates value that is        of the sum of the cost of the project's individual components.

 

A standby commitment may be required by:

 

Because projects do not generate rent or other cash inflows during development, it is very common for construction loans to include:

 

Which of the following is not one of the three categories of developers’ business strategies?