How do I make an offer on a commercial property

[Ian Jaeger]

Hey All,

I honestly don't even know where to start with a good question - I'm at the point where I still don't know what I don't know!

I posted about a property a while back that I thought could be interesting with little response.  A year later, after starting a business elsewhere I'm suddenly back looking at that property.  I've done the county search and found that the owner owns 2 side-by-side properties one with a single tenant, the other with 3 tenants.  Without knowing anything about the actual businesses (which look to be WAY under market for the area), how do I go about making an offer to the owner?  

Do I have to come to the table with an offer? Without knowing the NOI, can I use the price per sqft for other commercial property in the area?

Supposed to meet with a commercial RE realtor next week, but want to know what questions I need to ask when I meet so I don't look like a total idiot.

-Ian

[Ronald Rohde]

Please do not use a REALTOR. 

I'd say you can make an offer based on replacement cost or some other lowball metric. Ask for gross lease amounts and lease structure. You should input your own expense ratio anyway, his NOI can be high or low.

Just figure our debt terms, closing timelines, Phase I, PCR, ALTA survey. Typically for new buyers, 45-60 days DD, and 30 to close. Whats the purchase price (range)?