Deal analysis for Industrial Condo, advice appreciated.

[Larry Bly]

Hello,

I have the possibility of investing in an industrial condo located in Florida.  Running the numbers it seems OK but not great, I would like some input and opinions from more experienced investors.  

First of all I have been looking at Cap Rate and CCR as basic indicators while doing my research, I have found some sources that say I should include Debt Service in my CCR calculations and some that have not. If I leave out Debt Service the CCR looks pretty good at 12.42% (based on my findings that 8-12% is decent). However if you include Debt Service, it's suddenly more like 4.8%, not as exciting.

The Association maintains the building, takes care of all the common area maintenance, flood/fire/liability insurance and maintains accounts for all the large capex (new roof etc).

Right now it is one large unit made up of 4 smaller units which is occupied by a tenant who would stay in place. We are currently working on the financing but it seems we will have a 20 year 4.5% loan with a fixed rate for 5 years. We are putting down a rather large down payment being conservative with leverage so I realize this does not help our CCR especially if pre debt service.

The vacancy in there comes from a CBRE report and is what the agent told us also.  We are pretty happy with the area and there would be no repairs or TI as the tenant is staying (as of right now).

Any pointers or advice would be greatly appreciated, thank you!