Seabreeze Properties is evaluating a real estate investment of Green Hills Estates. Management plans to buy...

Seabreeze Properties is evaluating a real estate investment of Green Hills Estates. Management plans to buy the property today and sell it 12 years from today. The initial cost of the property is $7 million and the expected sale price is $19 million. What is the IRR of the investment? Enter your answer as a percentage and rounded to 2 DECIMAL PLACES. Do not include the percentage sign in your answer.

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Expert Solution

IRR(internal Rate of Return) is the rate at which the NPV =0.

Here IRR can be found using the excel function=IRR()

The initial investment=$7,000,000

The Sale price is $19,000,000 (year 12 inflow)

The formula used=IRR(B2:B14) We get IRR as 8.68% or 8.68

jeff jeffy answered 1 year ago

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