1) Expected net return from building at 8.5%

2) Expected net return from land at 5%

3) Rate of interest on sinking fund: 4%

4) Design life of building: 80 years

5) Salvage value: 10% of the cost of building

6) Annual repairs and maintenance: ½% of building cost

7) Taxes and other outgoings: 28.5% of gross rent.

Gross Rent = Total Net Return + Sinking Fund + Annual Repairs maintenance + Taxes and other out goings

X = 205000 + 1853.32 +10000 +28.5% X

X = Rs.303291.35 /-

*Considering G+2 building having one flat on each floor

∴ Gross rent/ Month $= \frac{303291.35}{12}=Rs.25274.27$

∴ Gross rent/ month/ flat $=\frac{25274.27}{3}=Rs.8424.75$