BP Friends, I believe I have come upon a pretty good opportunity and I am just about ready to take my first real big step. My question is; I am looking to by a commercial property 10 unit apartment, but the seller does not have a profit or loss statement and is not willing to go back and do her books, she does have 3 year tax statement. Is this a reason not to take what I believe to be a great deal?
10 unit apartment complex with additional community room that includes 2 restrooms, coin laundry, and an office area. Outstanding rental history. These 1 bedroom units offer an over sized bathroom and double closets. Owner pays monthly water and each tenant pays their own separately metered
Asking price 320,000
Monthly Income:
$4,890.00 | Monthly Expenses:
$3,731.69 | Monthly Cashflow:
$1,158.31 | Pro Forma Cap Rate:
9.45% |
NOI:
$30,236.40 | Total Cash Needed:
$96,000.00 | Cash on Cash ROI:
14.48% | Purchase Cap Rate:
9.45% |
Purchase Closing Costs:$6,000.00
Estimated Repairs:$10,000.00
Total Project Cost:$336,000.00
After Repair Value:$320,000.00
Down Payment:$80,000.00
Loan Amount:$240,000.00
Loan Fees:Amortized Over:25 years
Loan Interest Rate:4.700%
Monthly
P&I:$1,361.39
Total Cash Needed By Borrower:$96,000.00
| Total operating expenses: | Mortgage expenses: |
| Vacancy: | $342.30 | Repairs: | $244.50 |
| CapEx: | $342.30 | Electricity: | $350.00 |
| Water & Sewer: | $400.00 | Insurance: | $200.00 |
| Management: | $391.20 | P&I: | $1,361.39 |
| Property Taxes: | $100.00 |
ARV based on Cap Rate:
$755,910.00
All advice welcome. Thank you in advance!
keywords: multifamily, duplex, triplex, mfr, property management, finance, sale, buy, tenant.
