CASH FLOW AND DEBT SERVICE QUESTION

[Patrick Hill]

Hello, is this a deal if its actual information? I see a cash flow of $36,876 / 12 =$3073 monthly.   Down Payment of $415,000 looks like the difference of the Selling Price to existing Loan balance. I guess it would be an assumable hopefully can refi lower than 4.25%. If I wanted this and other properties.  It says the debt service is $97,994 / 12 = $8166.00 per month . If im cash flowing $3073 pre tax how can it be consider cash flowing? Or hopefully the cash flow pre tax , is after all reported expenses have been taking into account. Any help with this will be greatly appreciated. 

Tamarack

Price	$2,075,000	Cap Rate	6.50%
No. Units	24	Occupancy	95%
Building Size	20,670 SF	No. Stories	3
Price/Unit	$86,458.33	Year Built	1972
Property Type	Multifamily	Lot Size	0.56 AC
Property Sub-type	Garden/Low-Rise	APN / Parcel ID	WHAV-000048-000023

Financial Summary (Actual)

Year	2017	Operating Expenses	$101,837
Scheduled Gross Income	$245,376	Net Operating Income	$134,870
Effective Gross Income	$236,707	Pre-Tax Cash Flow	$36,876

Debt & Equity Information

Debt Type	Existing	Amortized Over	30
Loan Amount	$1,660,000	Annual Debt Service	$97,994
Interest Rate	4.25%	Down Payment	$415,000

[Jeff Kehl]

@Patrick Hill I think the marketing package or whatever you're looking at is suggesting the NOI is about $11k/month and then using their finance assumptions for a new loan that would be a payment of around $8k/month leaving you cashflow of $3k/month. On an investment of $415k that's a CoC return on 8.7%.

Not a terrible investment but that's assuming you believe all of their numbers and can obtain the financing they are talking about. Freddie Mac small balance might be close to that.

Are you looking to buy it or syndicate it? If you're wanting to syndicate it I'd say move along because there would be no room to pay investors.

Were you looking for value-add or a yield play? Are the units dated or recently rehabbed? What other deferred maintenance is there? 

I don't know what your market is but $86k/unit looks nose bleed expensive to me without spending any money on them.