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Updated about 7 years ago on . Most recent reply

Dori Arazi's profile image
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Dori Arazi
  • from Los Angeles , CA
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Dori Arazi
  • Los Angeles , CA
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Commercial Real Estate Investing

At what size does a property get valued by cash-flow

Dori Arazi
  • Los Angeles , CA
Posted

I'm finding some conflicting information about this. At what size do I (or the bank) start evaluating an RE deal by generated cash flow? 

Is it the moment the property is considered multi-family commercial (even if its 6 units), or only on the larger 50+ units scale? 

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Brian Garrett
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Brian Garrett
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Brian Garrett
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Anything 5 units or more is considered commercial and valued based off CAP rate.

Anything 4 units or less is considered residential and valued based off comps.

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