28 unit advice

[Account Closed]

This would be my first RE investment.  Long time researcher here on BP.

With 900 purchase and 180K gross rent per year (100% occupied), I was hoping for much better CoC (20-25%) but when I plugged in all the recommended % ages the CoC dropped to 8%.

Following are real numbers, taxes are high (spoken to county appraiser and tax collector), insurance is high as well, mantainance and cap ex is used from NAA 2016 survey (6.4% and 9% for garden style complex):

http://www.naahq.org/sites/default/files/naa-docum...

Also did itemized capex calculation for roof, parking lot etc + each unit with life span etc.  9% capex of gross rent and itemized almost align.

Commercial loan terms are with wells fargo for a 25 term loan, 10 years fixed and then refinance.

I am a bit concerned about commercial loan not having longer term and fixed rate, also higher interest rate.

I will create an LLC, have property damage, Liability and Umbrella insurance to protect myself.

Is the property management fair at 10%?

Should I worry about plumbing, electrical costs that might come up over the course as they are not upgraded?

Roofs are new, appliances are within 5 years.

How should I carry out inspections?  Read most of the posts but the cost seems very high for 28 units.

Anything else I should consider?

Purchase Price (Built 1970)	900,000.00
Down Payment (25% down + closing costs)	240,000.00
Commercial loan interest: 25 year term, 10 year balloon	5.97
Monthly Rent	15,035.00
Monthly expenses:
Property tax (2.275%):	1,704.35
Insurance:	824.00	Property damage, Liability and Umbrella (10K per year)
Elec + water:	1,400.00
Property Management	1,503.50
Maintainance: (6.4% as recommended by NAA)	962.24
CapEx: (9% as recommended by NAA)	1,353.15
Vacancy: (8%)	1,202.80
Total Expense:	8,950.04
NOI: (Rent - Expense) * 12	73,019.52
Cap rate: NOI * 100 / Purchase price	8.12%
Debt service: per month	4,331.85
Net Cash flow: (Rent - Expense - Debt Service)	1,753.11
Cash on Cash: (Net Cash flow * 100 / down payment)	8.77%