financial model forecasting

King Power Group is an investment group that has been engaged to raise capital for a client wishing to undertake the development of a mixed use property . The property will include Office space, and a hotel shopping mall. a.The estimated cost of the development is $40 million dollars. b.The total development area shall be 20,000 square meters of which 80% will be rentable. c.The period for construction shall be 24 months. d.The land for the development shall be provided by the client as an equity contribution into the project. The land is valued at US$3 million. e.A suitable financier has been identified and shall provide financing at an annual interest rate of [6 months LIBOR + 2%] for 10 years. There shall be a 2 year moratorium for interest payment. Interest shall be paid semi-annually with principal paid as a bullet. f.The revenue model for the project will be renting of the space to tenants and operators. Your assignment as the business analyst on this project is to: 1.Create a 10 year financial model forecast in USD currency (Income statement and Balance Sheet) for the project using the information provided 2.Advise on the appropriate mix of debt and equity to be used in order for the project to be viable. That is, how much should be borrowed from the Financier and how much should be injected as equity. 3.Advise on the rentals per square meter that the project should charge to tenants and operators in order for the project to be viable. Calculate the Net Present Value (NPV) and Internal Rate of Return (IRR) for the project. 4.Also justify and give a narrative for each of your assumptions used in your financial model forecast.