In calculating the Discount Rate for a retail strip center you are considering acquiring, you note that other similar strip centers generate a 9% Cash on Cash Return. You perceive less risk in the cash flows in your contemplated acquisition compared to these comparable strip centers. All other factors being equal, which Discount Rate would you select to determine your purchase price offer?

Real Estate Financial Modeling / Questions / In calculating the Discount Rate for a retail strip center you are considering acquiring, you note that other similar strip centers generate a 9% Cash on Cash Return. You perceive less risk in the cash flows in your contemplated acquisition compared to these comparable strip centers. All other factors being equal, which Discount Rate would you select to determine your purchase price offer?

Jun 22