Basic NAV model workout. We have a balance sheet for REIT, which shows the book value of the assets, liabilities, and equity. And what we need to do is we need to be able to value the net assets of the company on a market basis. So we're going to use a net asset value model. The model has three components. It has the capitalized income from the stabilized rent producing properties. It has balance sheet assets, it has the balance sheet liabilities, and then the other claims on equity. First thing we need to do is look at the NOI contribution from the wholly-owned properties, and those have an assumed cap rate of 5.5%. So we're going to take the 12-month forward NOI and divide it by our cap rate. We are then going to do the same thing for the unconsolidated joint ventures. They have NOI of 10, divide that by the cap rate. And then we're going to take the third party management fees of five and divide those by the cap rate of 15. The third party management fees typically have very high cap rates because those contracts are very cancelable, so they're slightly riskier and therefore are reflected in the higher cap rate. Now for the balance sheet assets, we have construction and progress assets of 500 which we will multiply by our adjustment factor of 110%. These are valued at slightly more than book value because they represent assets that will be coming online and producing revenue at some point, but they're still ways away. The land held for development, we've assumed to be worth 105% of its book value. Similar reason behind that it has not yet begun construction, so it is slightly lower in value than the actual assets under construction. And then finally, we have assets held for sale and we're taking a conservative approach here in valuing them at 100% of their book value. For the remainder of the balance sheet assets, we will also take a conservative approach.

Cash is typically always valued at its face value. The investments in the equity interests we're actually going to value at 0%, and the reason why is because we have already factored in the value of those unconsolidated equity investments in the capitalized income at the top. The capitalized financing fees value at a hundred, the accounts receivable at a hundred percent, and the prepaid expenses at a hundred percent as well.

We will now sum the total asset value, which is the total of the other balance sheet assets, as well as the real estate assets that are not producing stabilized rents and the real estate assets that are producing stabilized rents. And we get a total of 7,169.5. Moving on to the liabilities, we're also gonna do a very basic approach here and just take 100% of the book value of the liabilities.

For the redeemable non-controlling interests, these are zeroed out as they've been converted to shares down below, as we will see in a minute. Now, redeemable NCIS are put options that are controlled by the owners of the assets that were contributed to the REIT. They can be exercised by those holders, which either requires the REIT to redeem them for cash or convert them actually into equity. From a modeling perspective, we have the choice of keeping that amount as it is. We can zero it out and then move the balance to debt or we can convert them to equity shares. I've chosen here to convert them to equity shares. Whichever you choose, be sure not to double count. So I'm keeping this at zero. Now, these non-controlling interests which do not include the operating partners is discussed above. These represent the shares and stakes of buildings that we have purchased and consolidated, but not 100%. Though, I'm actually going to keep these at book value, and the same for the preferred stock. So the total other claims on equity value will equal 300 and now my net asset value calculation will be the total of my assets, less the liabilities, less the other claims on equity, 4,569.5. I have to put this into a per share amount. So my diluted shares are 75, and now I'm gonna add to it an assumed amount of five shares from the OP units in the redeemable NCIS that I've converted into shares. So that's gonna bring my total to 80. The REIT value per share then becomes the 4,569.5 divided by the 80. The premium is the REIT value per share divided by the share price, minus one. And according to this NAV calculation, the REIT value per share is at a nearly 21% premium to the current share price.