[Calc Review] Help me analyze this deal - mixed commercial prop

1 Reply

Hello there.  This is my first deal review request, so please forgive any mistakes or dumb things you're about to see.

I'm a SFR investor, but multi looks promising. This property caught my eye for several reasons

  1. mostly because I drive by it frequently
  2. it offers a commercial space, apartments, and mobile home lots
  3. it's close to my other investments and where I live
  4. I feel like this is an area ready to grow (it's the non-interstate link from big town to small town)
  5. it's not so expensive I can't find a way to do the deal
  6. I've been investigating mobile home investing lately, and this is one way to learn that
  7. I don't have a physical office space for my business, and this would lend credibility to my business (and allow me to have high-speed internet, which I can't get currently)
  8. I can use an apartment and rent my SFR for more
  9. the mixed use feels like diversification
  10. I wouldn't be surprised to see an investor try to buy this and several other spaces up for a large development
  11. I see potential in possibly converting the mobiles to tiny houses and increase rents accordingly

I'm not in love with the deal, but a couple of those reasons would sway me to consider a less-than-great deal, for non-financial reasons.

The numbers really look not very good, and it looks like a bad deal as it sits, considering I'm adding 1000 in rent increase and no rehab in this scenario.  I figure this is likely the commercial space value and I could probably add $50/month on lot rent, or trailer rent on the non month to month trailers (all but one).

I'm trying to learn commercial quickly, but I still don't know all the right questions, or what documents to request, or what things I don't know to ask that will bite me (are septic systems legal, violations, etc)

I would appreciate any feedback on any aspect of this deal, from my financing assumptions, cap rate, reasons I want to like it, office rental income, etc.

The numbers I used are from the P&L they provided, and seem really high.  It barely cash flows $1100/month with no financing, so something's up here, right?

THANK YOU FOR USING YOUR TIME TO HELP ME.

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*This link comes directly from our calculators, based on information input by the member who posted.


I can provide a lot more information, but felt like I rambled too much already.  I'm happy to answer any questions you may have, and will respond as quickly as I can, to not waste your time either.