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The NPV, on the other hand, won't consider the depreciation because it is the expense of capital. On the other hand, this is a component on the prolonged-expression management price, which also consists of the maintenance rate as well as the depreciation factor.

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In any sort of lodge, the management expenses are frequently larger when compared to the cost of cash. The my site upper the NPV, the reduce the general Expense. This is certainly why most traditional real-estate operators like Attributes that click to find out more have an increased NPV.