Cap Rates on Odd Retail Properties - Greenhouse
I'm looking at buying a small business and like to split the real estate and the business during the valuation process. For the real estate side buyer and seller agree that a triple net rent of $45k a year is a good starting point. - Long lease as it would be hard to refill. (10-20yr)
I don't want to be unreasonable on the valuation but in our small market (100,000 people) it would seem like a high cap rate makes sense. Industrial in Minneapolis and Chicago seems like 8% or so, by the time I adjust for location and uniqueness I\m in the 10 to 11% range. The difference between 10 and 11 is pretty high. Plus the limited rental options make 11 seem low a little. Just not sure.
Anyone with any experience with odd properties?
Thanks!!!!