THE NUMBERS DON'T MAKE SENSE
If the numbers aren’t adding up, something is wrong. Your broker will be able to enter your estimates and give you an estimated NOI. If they don’t look good enough, don’t try to get them to. Just as a lender would make the numbers conservative, I’ve seen buyers make the numbers go the opposite way and talk themselves into the possibility of doing that. This could also go the other way. The seller may be building on numbers that don’t make sense for their market and the area. If you can’t get them down in negotiations, then look somewhere else. It’s also easy to mistrust that the numbers the seller gives you are correct. They can also fiddle with the numbers to make the property look better than it is. This is why you need to have you and your team check them. Don’t depend on seller projections. This is why you need a broker on your team to bring experience in. Owners can give faulty numbers or skew them so their property looks better.
YOU NEED TO PUT TOO MUCH WORK INTO IT, AND THE PRICE DOESN'T REFLECT TH N'T REFLECT THAT
I’ve seen too many office buildings that look like a great investment on paper or online. Then, when you visit it, the story changes. The space is in decline and maintenance has been neglected for too long. The listing price is very, very cheap, but it doesn’t even fully reflect the amount of money you are going to need to put into the repairs and upgrades.
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