ASC Portfolio Analysis 5

Question 1

In ARGUS Enterprise, what is the purpose of the 'Portfolio Rebalancing' scenario feature?

Accepted Answer

Modeling the financial impact of buying and selling specific assets to optimize the portfolio's risk-return profile

Answer

Portfolio Rebalancing scenarios model the effect of acquisitions and dispositions to optimize the overall risk-return profile without requiring separate analysis files.

Question 2

Which ARGUS Enterprise assumption most directly affects the terminal value of a portfolio asset at disposition?

Accepted Answer

Going-out (exit) cap rate applied to the final year's NOI

Answer

The exit cap rate applied to the terminal year's NOI determines the resale value, making it the single most influential assumption on disposition proceeds.

Question 3

In a ARGUS Enterprise portfolio with both core and opportunistic assets, how should the analyst handle differing hold periods in a consolidated return analysis?

Accepted Answer

Model each asset with its own hold period and use portfolio-level IRR that accounts for staggered exit proceeds

Answer

ARGUS Enterprise accommodates varying hold periods per asset, and the portfolio-level IRR correctly incorporates staggered exit proceeds at each asset's actual disposition date.

Question 4

What happens to the portfolio's levered IRR in ARGUS Enterprise if the blended loan interest rate increases by 100 basis points, all else equal?

Accepted Answer

Levered IRR decreases because higher debt costs reduce cash available to equity investors

Answer

Higher interest rates increase debt service costs, reducing equity cash flow and therefore the levered IRR.

Question 5

In ARGUS Enterprise, the 'Gross Asset Value' (GAV) at the portfolio level is best defined as:

Accepted Answer

The sum of each asset's estimated market value based on its stabilized NOI and applicable cap rate

Answer

GAV is the aggregate estimated market value of all assets, typically derived by capitalizing each asset's stabilized NOI at its applicable market cap rate.

(ASC) Argus Software Certification Practice Test

(ASC) Argus Software Certification Practice Test

ASC Portfolio Analysis 5