market is 8 cap, rent under market price, selling for 5 cap?

[Allen L.]

Hi all, I am just starting to evaluate multi-family deals and came across a 23 unit multi-floor complex. I received its financials today and upon looking, it's 12-months performance puts it at 5 cap, and factoring in mortgage puts CF negative. Local market for properties around that age and class should be selling at 8 cap. Given the covid situation, a lot of tenants are behind on their rent. I'm guessing some of this is expected since trailing 12 months starts on May 2020 back during the eviction moratorium.

Pro forma shows 8 cap, obviously I am not paying for proforma and then doing the evicting and fixing for free, would it be a reasonable strategy to try to get it at 6.1 cap and then slowly raise rent to 8 to 9 cap or is this not ambitious enough? Or should I stick to 8 cap and move on if the owner won't budge? I know his purchase price and I don't think he would come to an agreement above 6.1 cap.

Thank you all.