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Question
A 1,000 square foot office space is leased at $15.00/square foot during the first year with $2.00 step-up provisions each of the following years. The lease is gross with an expense stop set at $6.65/square foot, and yearly expenses/square foot are as follows: $6.00, $6.65, and $7.05. The lease provides for two months of free rent at the end of the lease term. If the lease term is three years and the discount rate is 10%, what is the effective rent/square foot?A. $9.38
B. $9.50
C. $10.22
D. $10.46
Answer
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