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Updated almost 8 years ago on . Most recent reply

Mark Rauch's profile image
Mark Rauch's profile image
Mark Rauch
  • Commercial Real Estate Broker
  • from Tarzana, California
  • Member since Dec 30, 2015
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Mark Rauch's profile image
Mark Rauch's profile image
Mark Rauch
  • Commercial Real Estate Broker
  • from Tarzana, California
  • Member since Dec 30, 2015
Connect
Mark Rauch
  • Commercial Real Estate Broker
  • Tarzana, CA
2
Votes |
8
Posts
Real Estate Deal Analysis & Advice

Commercial Property Valuation

Mark Rauch
  • Commercial Real Estate Broker
  • Tarzana, CA
Posted
If one were to use the CAP RATE method for calculating the value of a commercial property, if all the leases are triple net rather than gross, would you simply divide the gross operating income by the CAP RATE? Am I right in assuming there would be no Net Operating Income (NOI) since the tenants are being charged back the operating expenses? Including taxes, insurance, maintenance and management. Would I still add in a 5% vacancy factor?
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