Start $1.00 23456 89 10 TV Key Assumptions Construction cost ($) Loan ($) 1,000,000 500,000 Loan interest rate Loan term (yrs.) Hangar space (sq.ft.) Rent ($/sq.ft. per month) 4.8% 22,000 1.30 Rent...

Extracted text: Start $1.00 23456 89 10 TV Key Assumptions Construction cost ($) Loan ($) 1,000,000 500,000 Loan interest rate Loan term (yrs.) Hangar space (sq.ft.) Rent ($/sq.ft. per month) 4.8% 22,000 1.30 Rent inflator 2.0% Operating Costs ($/yr.) 140.000 Cost inflator 2.0% Tax rate 21.0% Discount rate 6.5% Depreciation/year ($) 20,000 Cash Flows Rent Income Rent Income = Square Footage x S1/sq.ft x 12 months minus: Operating Costs minus: Interest minus: Depreciation = Taxable Income minus: Taxes = Net Income minus: Principal = Net Operating Cash Flow minus: Cash Outlay at Start plus: Depreciation Total Cash Flows NPV IRR Note: Tax shields are the tax gains from expensing interest and depreciation. The formula is interest or depreciation expense times the tax rate