How to Analyze a 0 Income Commercial Property
I've been looking at Commercial Properties in my area recently and I've been noticing it's hard to find those value add plays, especially those listed on the market.
However, I recently came across a property where the owner is 'highly motivated to sell' and really wants someone to just make an offer.
She runs a Salon out of the property now, but she's done with it and wants to move on. She's only using 1 unit of the property for her business, but when she sells it she'll be moving out. The property has 3 separate units. 3 separate utility rooms each with their own Furnace, A/C and separate meters.
The problem is when she moves out, the property will effectively producing 0 income.
There's a massive value add opportunity there, but I would have to find 3 tenants to fill the vacancies.
Based on the location, this property should be no problem to rent, but I'm really unsure. There's only a handful of properties for lease right now in the same city.
How would you guys analyze this commercial property that effectively will be producing 0 income at the time of sale?