ok. its an 17500sf center, less than 1 year old. triple net leases. its a 17 unit center and 16 units are rented....
is there a formula for figuring value based on income?
also, as far as perm financing, what should i look for?
Ok- I'm a newbie but it sounds like you need to do some homework and reading.
Usually cap rate is used. Say you want 8% cap rate. Then the cap rate is net income/property cost.
If it is NNN, then there shouldn't be too many costs as property taxes, landscape maintenance, etc are charged back to tenants. (But not shell insurance???)
Most advice I see says only use the 16 units rented for you income info. Once you have the building under contract you can verify costs, etc. in more detail.
Re-perm financing, I'm a newbie for commercial. Obviously you want a interest rate less than your cap rate. Apparently some banks look at the leases and financials of the tenants for large loans.
I am a commerical appraiser by day and a real estate investor by night. I would suggest you hire an appraiser to value the property. The income approach is a little more complex then just picking a cap rate. Whats the condition of the property? Whats the the build quality?, Whats the market it serves?Is it a institutional grade property and if not what grade? Do you have surveyed cap rates for your market area?
But to answer the first part of your question you take the 16 contract rents and then you must find the market rent for the unrented unit . Good luck