How to value a unique property

[Jack Chamberlain]

I'm looking at a property with 65 units. The price is 1.25M at a 6 cap. NOI is 73k. This area should be offering buildings closer to a 9-11cap. The interesting thing about this bld. is that there is 25 vacant units which need to be rehabbed. The missing income should be 150k, but lets say it's 100k after vacancy, extra expenses and seller smoke and mirrors.

Lets say I need 200k to bring the units back up to rentable condition, so I'm in for 1.45M, with a new NOI of 173k. So my cap rate is just under 12. At the asking price, I'm not really buying a real cap rate...everybody says you should buy based on the current income...BUT...I can't act like the 25 units don't exist.

How much is a fair offer?

Jack