Lowest cap rate and Cash on cash return

[Kevin Guo]

When you guys look at multifamily properties what's the lowest cap rate you will buy it at and what's the minimum cash on cash return to make the property worthwhile? It appears that cap rates are heading downwards in my area (<8%). Properties around 8% are flying off the shelf fast.

[Jeff Greenberg]

These days I am looking less at Cap rate and more at what value adds I can create to boost the coc return.  Coc is what will bring in investors.  Even though rents are going up in most areas, a slight downturn will kill any gain in value.  Having a value add component besides raising rents, provides additional safety.