Can This Be?

[Michael Barido]

I'm interested in a Class C, 27,000 sqft building in a down town area (population near 50k) that is owner finance. Terms aren't 100% but thinking $220k (full asking), 30 yr amortization, 6% rate, 10 yr balloon, and 10% down. It is 100% leased with a local hospital's plastic surgery center, a financial business, a physical therapy business, and one or two more businesses. Leased amounts total $35k/m at NNN (so advertised) but not sure how that works with multiple tenants. Building purchase price is $2.2M. Cash flows per my tough calculations are $9k with full gross lease and $15k with NNN. Does this make sense. Let me know if additional info is needed.

[Michael K Gallagher]

the devil is always in the details.  what are the leases like, who is responsible for large cap improvements like the parking lot etc?  what are the terms on those leases?  any options to renew?  these all will have an impact on the deal.  and to another point here, what's the surrounding market like to release the space when one tenant leaves? is the building and space such that you can easily plug a similar user in the space and be off and running?  or are you going to have to offer free rent or TIA to attract a new tenant?