Any insights on how you structure appraisal gap coverage (full vs partial, caps, etc.) would be really helpful for my next offer.

But cap ex took away a lot of profits.

Any suggestions for the appropriate COC or Cap rate? 

I also look at how “clean” the expenses are: taxes, insurance, PM, and reserves look properly accounted for here, which is important because a deal only works if nothing is hiding off-paper.A 7.5% cap with positive cash flow is respectable in this market, especially on a small multifamily.

Seems like a lot of businesses like CA.Ab 1482 limits rent increases to 5% + cpi capped at 10% so it exceeds inflation unless inflation exceeds 10% which has not happened this century.  

MHP have one of the largest variations in a tenant profile that is NOT reflected in cap rates like the traditional apartment market.

I also realize I could do a 1031, but I dont see any deals in areas on the mainland US that make sense to me and Cap rates are low there and here in Hawaii.Im torn between paying off the mortgage for a nice cashflow of $3800 per month (ROE of 3.8%), or selling to put roughly 700,000 k in the market and working the 4% FIRE rule with that money after letting it grow for a bit. 

Most of our buyers are capped before they even began looking.

They don’t usually foreclose like mezz— they take over control rights if things go sideways.Ideal for:Ground-up or heavy value-add where cash flow is lumpyDeals where senior lenders cap leverageSponsors who need flexibility on timing of returnsThe real deciding factor: cash-flow timing vs. controlIf you can make regular payments but don’t want to dilute ownership → MezzanineIf you can’t guarantee near-term cash flow but need capital to close the gap → Preferred EquityIf your senior lender forbids mezzanine (which happens often) → Preferred Equity is the workaroundOne more nuance most posts miss:Preferred equity comes in two flavors:Soft Pref – economic preference, no takeover rightsHard Pref – essentially mezzanine equity with control triggersUnderstanding which version you have matters just as much as the return.Both tools are powerful, if you pick the wrong one for the wrong project, it can wreck your risk profile.

The real issues arise from everything else investors underestimate: increased cap-ex budgets, rising insurance, higher turnover costs & higher vendor pricing.