Please model the following sub-urban office development joint venture project and estimate IRR and Equity Multiple (Cash Multiple) for:
¨
The JV(合资企业)
¨
Operation partner（经营伙伴）
¨
Wins Investment（稳盛投资）

All units are in RMB.

Land Area: 200,000 m2
Construction GFA(Gross
Floor
Area): 150,000 m2
Rentable / Saleable GFA: 120,000 m2
Land Cost: 1,200 per m2 of GFA
Construction Cost: 3,500 per m2
The project will be for leased at 1.2 per m2 per day as of Dec 2007
Market rent growth: 5% p.a.
Loan from ICBC: 50% of total cost at 7.8% p.a. interest only

Development Schedule:
15 months after first funding（第一次拨款）

Leased-up Schedule:
Leased to 2 tenants at future market rent; 50% of the area to each tenant
1 year lease term
Tenancy starts 3 months and 6 months after project completion
No extra management fee

Exit:                （如何理解？）
Exit at year 4 from initial funding at Ju n 2008
Exit Capitalization
Rate of 5.5%



Shareholding structure:
50% : 50% (operation partner vs. Wins Investment)

Promote Structure :           （如何理解？）
After 10% IRR to the JV, 20% will be given to the operation partner as a promote