Cash Per Door Expectations

[Kevin Sack]

I am actively seeking my first multifamily deal in the Norfolk/Portsmouth area. Am I off base for trying to get $150/door net cash flow on a quad that rents 700/month? That tends to put me at 80-85% of most asking prices with all my expenses and 20% down conventional financing.

Kevin

[Renard Miller]

Hi, Kevin. My wife and I have four multiplexes in Hampton, VA and our returns are in that range. We've gotten lucky to get closer to $200/door on some, but I would say $150/door is a reasonable basis for offers. Your mileage may vary in Norfolk/Portsmouth, but I can't imagine it being so different as to make such an estimate off base.