Need help Analyzing a commercial property

[Albert Lubin]

Hi everyone! I'm a newbie and I'm analyzing a 10-unit property to buy and hold. Based on my analysis, the recommended Purchase price is coming up way lower than the asking price. Am I doing something wrong? 

Below are the key data points:

- Gross Rental Income: $118K (I received the rent roll list from agent)

- Effective Gross Income: $112K (I'm assuming a 5% vacancy factor)

- NOI: $56K (I'm assuming 50% Operating Expenses - inclusive of 10% property mgmt costs, repairs & maintenance and CapEx reserves)

- Recommended PP: $623K (Market CAP rate is at ~8%; I used 9% because I want the Cash on Cash return to be 10%+ with a 30% DP at 7.2% interest rate and 30 yrs term)

- The asking price is $1.25M. What am I doing wrong? Or is the asking price ridiculous?

I welcome any insights so please help.