Attempting to analyze this commercial RE opportunity

[Chris Higgins]

As apart of my 2019 goals, I plan to branch out from doing just single-family rentals to exploring opportunities on the commercial RE side of the world. So this is my first attempt at analyzing a commercial RE opportunity and welcome any feedback to see if I'm on the right track. This is a 6-unit multi-family building in FL with an asking price of $450,000. It's a single story set-up in good condition with relatively new roofs and a/c units. All units (5 1/1, 1 2/2) are fully rented with a combined grossed income of $4700. Additionally, the current rental income for each unit is consistent with the current market and location.  

My approach with this analysis was to start by running the numbers based on the current asking price, then work my way back to a price I would be comfortable offering (based on the analysis).  Some of the expense numbers were supplied and others I estimated. Additionally, I assumed 20% down with a 6.5% interest financing of the rest. Admittedly, I haven't gotten to "exploring commercial lending options" part of this exercise, so not sure how realistic is a 6.5% commercial rate. I do plan to re-run the numbers once I nail that part down, but for the purpose of this exercise, lets assumed 6.5%.

Here is a break-down on my analysis based on asking price, estimates, and current assumptions: 

Here I ended up with 5.56% cap rate, 86% DCR, and a $4133 negative annual cash flow. However, my goal is to have a min. cap rate of 8% and min DCR of 125%... and of course a positive cash flow would be nice :)

So after playing with the purchase price a bit, I determined the MAX I could offer for this property, based on current assumptions & criteria (min 8% cap, min 125% DCR, and positive cash flow), would be $335,000. 

Thoughts? Advice? How is my analysis?? (sidebar comment: BP could do with emoji support..my question seems a bit incomplete without a "shoulder shrug" emoji at the end :) ) 

See breakdown $335,000 offer price below: 

Chris,