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Updated about 7 years ago,
Help analyzing a 22-unit deal, (my 1st commercial multifamily)
Good Evening BP!
I have a property I have been looking at and I would like to see what the community thinks. The property is a C+ class in a great city with good schools, and stable job market. Rents are below market (9% on the 2beds, 18% on the 1beds), I think its due to passive management.
22 units (2 buildings, brick low-rise)
Asking Price: 1.2M
7 Cap Rate
NOI: 89,191
2016 financials:
Income: 151,083
Accounting fees: 2,492
Legal fees: 347
Insurance: 3,100
Repairs: 22,511
Utilities: 7,665 (landlord pays trash and Water
Contracts: 2,840
Taxes: 26,402
My underwriting of this deal, says the purchase price should between a 7.5-8 Cap. What do you think?
About me: I have 13 units in this market, however, they are all duplexes and fourplexes. I want to break into commercial in 2018.
Thanks in advance!
Vince G