You can get appreciation in a-b areas, but it's harder to get the rent rolls to cover your expenses.Rent rolls are higher in c-d areas due to the higher risk: turnover, vacancies, property loss, evictions.Rent rolls in a-b areas don't have a risk premium because you have less issues and more people would rather own than rend in those areas.

Back of the envelope math:$800 rentLess 7% vacancy & collection loss~$744 net rentLess 40% expenses (pick appropriate %)Equals $446 net income per unit/mth or $5,356 annualIf land plus building plus interest and carry costs to get leased up total $1.5m, that's $68k/unit. $5,356 / $68k = 7.9% yield on costsIf cap rates on similar product in the area are equal to your yield then you didn't create any value for the effort and risk it took to develop from ground up.

Leverage is a great tool to increase returns if you respect its power to juice returns (and losses) and know how to use it.

Wanted to get some opinions on this....

I'm looking at a CRE deal in the Downtown area of my town; great foot traffic, historic, etc.

It's currently set-up as multiple office spaces for rent and not positively cash ...

Loss of license and or life is not something I am interested in.

you suggested the toilets were next to be upgraded as they were older so I assumed not low flow,  so your water loss is due possible leaks and an  probable extra resident.  

I just purchased Excel so I can have a more sophisticated and professional way to keep track of my rents received and profit/loss etc.

I am unable to write off my investment losses beyond the yearly $3,000 hence looking at the RE market.My credit is over 800 and I want to put $$ to good use.1.

I know that every successful investor utilizes spreadsheets to record data, but without concrete examples I am completely at a loss.

@Russell Brazil Thanks for the advice - I'd like to charge her for the stress she's giving me and with her delay games even if it goes through we will now have to rent a month which will also incur extra moving charges so there will be a monetary loss on my end at least 3k for her actions in this matter thus far.