Help me analyze this Multi Family unit

[Shmuel Waldman]

33 Unit - Asking $4350000 - ( I believe I can offer $4120000)

Building is %100 occupied 

Current Rental Income -   $400380 Total Additional income  $20698

Expenses

Real Estate Taxes $66,695

Insurance $8,407

Trash $3,534

Electric $2,375

Alarm Monitoring $666

Gas $18,749

Pest Control $1,135

Water/Sewer $24,051

Landscape/Snow Removal/Cleaning $12,168

Management $34,439  

Repairs/Maintenance $16,000 Cap EX $20019                          TOTAL EXPENSES $208235 NET OPERATING INCOME: $212843
Dept service  $195600 There is a big rental upside Currently the average rent is 1042 per unit Comps tell me that if I fix up units @$8000 per unit - I will be able to get $1300 average on a unit. Once all units are done over the building should be able to fetch $6m after 36-48 months 

[Marjeanne Fields]

From the numbers you are showing you are only at a 1.08 DCR. No bank will loan unless you can hit 1.2 DCR. Your estimate of $8000 per unit seems extremely high. We usually budget max $5000- $6000 but typically around $4000 per unit. Where is this property located? Your electric seems low. If you are new you might want to underwrite at a higher insurance cost unless you can use your property managers insurance.

Also- according to your numbers you are buying at a 5% cap and selling at a 5% cap. Might be a challenge to offload especially since we are looking at an economic down turn coming. 

I personally think that if you buy this property you will lose money. 

Hope that helps!