Asking for expertise for a commercial property : national brand

[Aman Kaur]

What should I look for if this deal makes sense ? Should I buy it ? What you think?

Single tenant National brand

Great location among many other national players

NNN lease

15 years term pending with further options

Asking price $9.5M

Trying to buy at 10% cap

[Joel Owens]

Aman you said ( 15 years term pending with further options  Asking price $9.5M Trying to buy at 10% cap)

What is the cap rate at the ASKING PRICE??

Most NNN trades at no more than 10% off of the list price and many less than that or at asking price. It depends on a lot of factors.

I look at about 1,000 a week nationally for clients and I have not seen a 15 year lease for a 10 cap. Sometimes you will see a 9 cap but is a LEASEHOLD where you own the building but not the land. Very hard to finance and typically all cash purchases.

Have you bought NNN before? First we need to see if your expectations and market expectations are founded in reality before answering a ton of hypothetical questions.