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Humber College PREX-1060A Exam Syllabus Topics:

Humber College Exam 4: Invigilated Theory Sample Questions:

1. A buyer client is interested in purchasing an industrial property for their manufacturing business. The buyer's salesperson informs them of the building criteria, along with the minimum requirements for clear height and clear span that would be suitable for the buyer's business. What should the salesperson explain to the buyer regarding clear span?

A) The salesperson should explain that clear span refers to the amount of floor area that is clear of interference from columns and walls.
B) The salesperson should explain that clear span refers to the unobstructed vertical distance from the floor to the bottom of the lowest ceiling or roof component.
C) The salesperson should explain that clear span refers to the total amount of floor area in the space, including the space that is occupied between columns and walls.
D) The salesperson should explain that clear span refers to the unobstructed vertical distance from the floor to the bottom of the highest point of the ceiling or roof component.

2. A salesperson is representing a commercial landlord in a lease negotiation. The landlord wants to sign back the offer with a higher rent. What should the salesperson make the landlord aware of regarding the rent increase?

A) The rent increase can be any amount.
B) The rent increase can be challenged by the Landlord and Tenant Board.
C) The rent increase cannot be more than the Consumer Price Index (CPI).
D) The rent increase cannot be higher than the guideline set by the government.

3. A salesperson negotiates the purchase of a retail property for their client, who plans to open a new store at this location. The client asks the salesperson how many parking spots the property will be required to have to meet the zoning requirements. The salesperson replies that the municipality has zoning requirements that set the minimum parking ratio. How will the municipality calculate the parking ratio?

A) The municipality will take the number of available parking spaces and divide it by the projected number of monthly visitors.
B) The municipality will take the property's gross leasable area and divide it by the number of available parking spaces.
C) The municipality will take the number of available parking spaces and divide it by the property's gross leasable area.
D) The municipality will take the number of available parking spaces and divide it by the property's net leasable area.

4. A salesperson is discussing the advantages and disadvantages of owning commercial real estatewith their investor buyer client. Which of the following is NOT an advantage of owning commercial real estate?

A) Limited equity investment while gaining leverage through financing is an advantage of owning commercial real estate.
B) Potential for tax sheltering possibilities for the investor is an advantage of owning commercial real estate.
C) Potential to recover capital through refinancing is an advantage of owning commercial real estate.
D) Quick turnaround time to free up capital when needed is an advantage of owning commercial real estate.

5. An agreement of purchase and sale for an industrial building is accepted conditional on financing with the expiry date of May 14. On May 11, the bank informs the buyer the mortgage cannot be approved until May
17. The salesperson for the buyer then prepares an amendment to the agreement of purchase and sale for the extension of the condition. Which of the following is NOT correct?

A) To play it safe, the salesperson should amend the condition with May 18 as the expiry date.
B) The salesperson should prepare the amendment with midnight, May 17 as the irrevocable time.
C) The buyer can still waive the condition before the expiry date if the seller refuses to sign the amendment, provided there is a waiver provision in the condition.
D) The buyer can use the same amendment to ask for a change of the closing date.

Solutions: