Need help analyzing NYC Multifamily mixed use deal

[Frank I.]

A 24.69' wide, 5 story walk-up mixed-use building located on the southwest corner of East 29th Street and Second Avenue in the upper east side of NYC. The property is comprised of Irish tavern on the ground floor and basement, the first and only all draft Guinness bar in the world. The second through fifth floors consist of 8 apartments (2 per floor). The unit mix consists of 1 studio apartment, 5 one-bedroom apartments and 2 two-bedroom apartments. The building is in good condition.

Lot Dimensions: 24.9x77.73
Building Size: 5 stories plus basement
Property type: C7-Walkup over 6 families and stores
No. of Units: 9 (8 residential/ 1 Retail-bar)
Gross Sq.Ft: 8,588
Lot Size: 1,919
Zoning: C1-8A
Allowable FAR: 7.52 (currently 4.59)
Additional FAR: 7,350 Air space rights
Year built: 1920 (major renovations and upgrades 1988)
RE Taxes: $64,622

Operating Income
--------------------------------------------------------
Unit |Tenant Status| Size| Monthly| Annual
--------------------------------------------------------
Basement (business) 1919
Ground (business) 1919 $19,991 $239,891
2E month to month 2bdrm $3500 $42,000
2W month to month studio $1800 $33,600
3E Rent controlled 1bdrm $140 $1680
3W Rent Stablized 1bdrm $1140 $13,680
4E month to month 2bdrm $3200 $38,400
4W month to month 1bdrm $2400 $28,880
5E Rent controlled 1bdrm $157 $1,884
5W month to month 1bdrm $2800 $33,600

Gross Operating income: $32,168 monthly and $433,615 annually

Expenses
-------------------------------------------------------
Expense| Cost
-------------------------------------------------------
Taxes $64,662
water $2,500
fuel $10,000
electric $2,500
super $2,400
maintenance $7,000
insurance $7,350
management (3%) $13,006

Total expenses:$109,878

Net operating income: $323,737

The building apartments do need cosmetic and asthetic upgrades, I am told by the realtor that the upgrades run
in total between 30k - 50k per apartment.

current cap rate based on latest accepted offer: 5.9%
least cap rate I am willing to accept to make an offer: 10%

Real estate owner is also selling the bar that consumes the ground floor and basement of the building. The business revenue is between $400k-$600k annually with business operating expenses of 100k.

The seller is very motivated to sell in order to move back to europe, the seller first accepted an offer of 6.7mm, the deal did not go through because it was dependent on the buyer's 1031 exchange, the seller then had another offer at 5.5mm and the seller accepted but the deal did not go through because the buyer could not get adequate funding, the would be buyer was rehabber.

I wanted to make an offer of 3.137mm
I derived this number because the least amount of cap rate I willing to accept is 10%, that means the price has to be $3,237,370 but because there are needed cosmetic upgrades, I totalled it to be $400k. So I subtracted $400k from the 10% cap rate price, that is $2,837,370 and added the $300k NOI for the retail bar business as well.

I have four exit strategies:
Exit Strategy 1:
Sell property and business only after apartment upgrades are complete and rents have been raised to average rent in the area. Time frame is 3 years

Exit Strategy 2:
If area continues to boom due to bounce in the economy, keep the property and the business, after apartment upgrades then refinance loan to a more stable rate. Time frame is 3 years

Exit Strategy 3:
If area continues to boom due to bounce in the economy, keep the property and close or sell the business, lease the space to a 4 star or 5 star restaurant, after apartment upgrades then refinance loan to a more stable rate. Time frame is 3 years

Exit Strategy 4:
Do an equity partnership, close the business, exercise the additional 7,350 airspace rights and rehab the building into a high luxury condominium, then lease the space to a 4 star or 5 star restaurant, after rehab is complete. Time frame is 5 years

Please let me know if this is the right way to analyze a property and derive true property value base on income it generates. I am looking for partners in this deal as I have good credit but I have low liquid cash.

Thanks in Advance,
Frank