Multifamily deal analysis help

[David H.]

Hello everyone. First time poster, but I have spent some quite a bit of time in the forums since finding this site last fall.

I have a 13 unit (8,000 sq. ft.) building under contract for $279,000 and am in the due diligence period. Wanted to get some feedback on the deal and numbers. I have other investment properties (4 units or less), but this is the first larger multi-family. Single story, brick building with a pitched roof built in the late 60s. Stable B to B- area.

Unit mix - 11 one bedrooms ($460 per month), 2 two bedrooms ($475 per month). Total gross rent of about $6,000 per month. Currently fully occupied. I think there is some upside in the rents (especially 2 bedroom units), but I am not counting that in my numbers.

Central laundry room with two sets of owned (not leased) coin op washers and dryers - estimating about $80 per month.

Tenants pay their own electricity (electric radiant ceiling heat and in-unit electric hot water tanks). Owner pays water, sewer, and common area electric (lights, washer, dryer, and electric water heater for laundry).

Annual Property taxes $8,600
Annual insurance $3,500
Management fee 7%
Annual Advertising $1,000
Water $240 per month ($2,880 per year)
Owner electricity $80 per month ($960 per year)
Lawn/Snow, etc. $1,550 per year
Legal $500 (rough estimate - many tenants are long-term and there have been no evictions in the past few years)
Maintenance $300 per unit per year (this is much higher than the current owner's financials)
Dumpster and trash removal $150 per month ($1,800 per year)
Reserves $250 per unit per year

With a 10% vacancy rate assumption, I come up with NOI of about $33,000, which would be just shy of a 12% cap rate.

Am I missing anything in these numbers? I would appreciate the feedback.