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Updated almost 11 years ago on . Most recent reply
Master Lease Options
What is a good premium to offer on a master lease option? I have read in place 10% but I think this may be a little high for apartment complexes. Does anyone have any suggestions and what basis do you use for determining what to offer? Thanks
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#5 Guru, Book, & Course Reviews Contributor
- Investor
- Sherman Oaks, CA
A Master Lease Option on an apartment building is where you
1. lease option on a master lease
2. Lease payment is NOI, which you have for 3+ years
3. your job is to turn it around, as in paint, carpet, raise rents, , decrease management expenses, etc.
4. Now you hopefully have increased the NOI and can either sell the option for a profit or get financing and buy it.
5. you pay very little for your option, and hopefully it is something you can turn around quickly.