How to properly offer a fair value of a multifamily apartment

[Bhairav Bhavsar]

I am interested in a purchasing 7 unit apartment which is listed for $1.6 million with cap rate 4.40%. $136,500 annual rental income based on the marketing material which average about $1625 per unit rent monthly.   Upon my underwriting based on actual numbers the annual rental income is $120K with as all 7 units bring in different income per month some are $1625, $1100, $1250 etc.  

This is a class B property in Class A area.  Seller has renovated all the unit and invested over $20 to $30K with the renovation.  This is a turn-key multifamily meaning the new owner will not have to do anything except for raising rent.  

What do you guys think?