Help with underwriting a 15 unit property

[Ryan Miller]

I currently own a portfolio of single family and small multi buy and hold properties. There are also a few short term rentals in the mix. I have an opportunity to purchase a 15 unit property using owner financing but he would like me to give him the sales price. He has agreed to a 20 year low interest note but wants me to make the offer for the price. I do not have experience in underwriting a larger property like this so I am looking for help.

The property has 15 studio apartments, 10 are currently rented. Each unit gets $550-$700 per month. Rent does include electric and water. I do have the owners last two years financial statements. His net from 2022 was $86k and he owns the building free and clear. He's on pace to make $70k this year. It's lower since he has not worked on filling the vacant units (he owns 200+ properties and this one is not a priority) which I would be able to do with no issues. I would need to put some work in the vacant units: paint, flooring, but nothing major.

I am just not sure how to price this property; any help would be appreciated!