I Need Your Help Analyzing a Property!

[Gina Dovel]

I've been looking on LoopNet for Multi-unit properties in North Carolina and wanted to get some opinions from my experienced BP members.

Church Street Apartments

264 Church Street, Concord, NC 28078

$465,000

14 Units 

Multifamily Property For Sale

Building Size:0 SFPrice/Unit:$33,214.29 Property Type:MultifamilyProperty Sub-type:Garden/Low-RiseProperty Use Type:InvestmentCommission Split:3% Cap Rate:13% Gross Rent Multiplier:6.62 Occupancy:100% Lot Size:0.53 ACAPN / Parcel ID:56217008770000Listing 

Net Operating Income $60,450

Here is a link to the property http://www.loopnet.com/xNet/MainSite/Listing/Profile/Profile.aspx?LID=19048378&SRID=5435875991&StepID=101

[Richard Haiber]

like greg said youll want to verify numbers. are they actual numbers from the property? or are they estimated pro forma numbers they've created? if those numbers are accurate/actual (noi = 60450 and price = 465000) then that could shape up to be a good deal.

a lot still needs to be uncovered through due diligence and examined such as:

-title report

-inspections/inspection reports

-previous yrs income/expense statements, rent rolls, utility bills, any service contracts attached to the property, previous years tax bills, etc.

-existing loan documents

-any open litigation against the property?

-floor plans (any renovations needed? theyll help you with estimating what it might cost per unit)

-actually visit the property (with someone knowledgeable) and assess the condition of the expensive items (roofing, heating/ac systems, foundations, plumbing/elec, etc).

some of these things will most likely be req'd by whoever your lender is anyways. of course some sellers wont oblige the requests for such detailed info until theyre confident in your offer/ability to purchase

also, sometimes people only look at their buying plan. you want to have a further view and have a plan on exiting (selling it when youre done). how you finance it can impact this because youll want financing that's favorable not only to yourself but to a future buyer as well.

being able to sell it off as easy as possible is an advantage and you should always think how you can approach a property thinking "how can my actions help the property be worth more in the future and ease such a sale/transfer when im done?" essentially, try to be as conscience as possible with everything you do to the property. that still leaves a lot out of the equation but I hope it covered some good points that might help you in the future!