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Show £311, Using the actual cost of $2, 500,000 for the dorm'mry at Michigan State College and predicated on the site being .mrnished, without cost, the financing on a 10% basis would follow a pattern somewhat as follows: Amount of loan? $2,500,00, term 30 years; interest rete'Bs-a'l/lfi, mmual level payment required to pay interest and principal approx-a imately $132,500 per yeare Predicated on the above loan requirements, the minimtm annual net operating profit would need to approximate $150900 produce r men on the basis of 900 occupancy, would 135,000, This particular building is producing more than $150,0GDbecauee of the higher occupancy, that is 1,350 rather than the 900 hex-mama Prior to the war an average net operating profit of $125 to $135 per man was about the average, Girls dormitories produced a higher net, "usually rmming from $150 to $1650» - ' . lathe operation of each Men's Dormitory, the Michigan ‘ State College net operating profit will divide itself into two classifications «- house operation and food opera» 'tiono The house operation will produce about W the net income and "food operation about 60% On the bee or, a required $150 not" operating profit per man in a dormitory to house 900 men the house operation would a 1'03me , $60000 per man and the diningroom Operation 90000 per man, In certain instances the operations will come fairly ‘ close to being on the basis of 50% from the house operations and 50% from the food operationso ~ ' In connection with the food Operation, mention should be made of the fact that absentee meal income is a factor which is very important in estimating net operation results, Board rates are fixed on the basis of no credits for meals missed and the history in all dormitory operations in this State shows as high as 15% absenteeism, . ~. ‘ It is worth while noting that in fixing the rate for board and roam at the, various colleges in this state, increased costs of food and wages have been taken into consideration but there has not been a, proportionate increase to cover a a -'increased costs "of construction, The increase in net opera ‘ sting revenue has resulted from the dormitory housing. a larger number through increase in occupancy of the dorms- it'oriee by approadmately 51.2%. In a sense, of course, it can. be said that this policy has resulted in an increase in room rates over prewar in that facilities of a room are divided scone three boys, rather than twoo |
