To do a DCF calculation of real estate you would use a shorter time period than that, typically 5-10 years. While everything taught by MHU utilizes trailing NOI to calculate a value, a more academic way is to approach it would be to apply a terminal cap rate to the year 11 cashflow (read how an appraiser would handle it). A conservative model would using a higher “going-out” cap rate than the “going-in” rate. The theory behind that is, you are dealing with an older asset that has physically depreciated over the holding period. With the low historical cap rate we are seeing across all commercial real estate assets, it is not unreasonable to assume cap rates will be higher in 5-10 years. However, if you have a capital improvement plan that you will account for in the model, a lower terminal rate may be appropriate.