MMP212 Lecture Notes - Lecture 6: Cash Flow, Capital Expenditure, Discount Window

• School: Deakin University
• Department: Business and Law
• Course: MMP212
• Professor: dr jerry liang

Document Summary

Assume that the value of the investment grade property is reflected by its income producing capacity. Value of the investment grade property equal to the sum of the present value of all cash flows (in and out) generated by the property. Cash flows need to consider = noi and expected resale price. In analysis investment feasibility: equity: in the context of real estate and finance, it is the amount of capital that belongs to the owner/investor. Total of cash inflows to the equity > (greater than) total of cash outflows from the equity: Total of cash inflows to the equity < (less than) total of cash outflows from the equity: bad. Cash flows need to consider: initial outlay, after tax cfs from operation, and resale. The money invested by the investor from the equity when acquiring an investment- grade property. Purchasing price of property (+) the cost of acquisition (+) initial repair or improvements required to make property leasable.