Hello All,
Im looking for an alternative to the standard practice. A debt structure for SFR that's valued by cap rate as opposed to individual appraisal.
Im open to speculative conversations but here is the scenario.
Tenant:
National tenant, operating 4000 leases nationally on single family homes
willing to pay 1% of gross value and sign a multi year lease. (can be structured as a NNN)
Portfolio:
I want to build to rent 9 houses to meet the value basis. ie: $436k/ build to meet $450k appraisal.
(option to go to 24, but I want the initial project to begin locally.)
Location- Ohio
Market type- Local, within 8 miles to me
Builds- Identical 2700sf, 4 bed, 3 bath , placing the same structure that meets the tenants criteria in 9 locations.
Debt: Seeking a refinancing option based on a 9% cap rate
The difference ( 450,000 x 9= 4,050,000 vs NOI of $384,261 / 9% = 4,269,576 or $474k/property + tenant)
with our continued rates of appreciation and a standardized tenant/lease structure in place, this should be a win for everyone.
Who has a solution? or please punch some holes in my thinking
