Mezzanine included in the price?

Question

Hello BPers, I am new to CRE and interested in industrial warehouse. Should I account for the income from mezzanine in the warehouse area?

In seller’s calculation, the price included the income from mezzanine. But I heard that it shouldn’t be included. Can someone educate me?

Thanks

Account Closed · Answer

No you shouldn't. I would make a rare exception for a really nice finished office space. If you end of paying for the mezz SF for some reason, make sure the deal works even with excluding that SF at the exit. A lot of buyer will not pay for that.

Ronald Rohde · Answer

Typically not additional rent. If he has income, it may be a separate TI reimbursement type situation for the additional improvement after the original lease.

Mezzanine included in the price?

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