I’ve become interested in retail/office condos and was considering purchasing a couple of units for investments. I have a couple of questions and would appreciate any opinions. What expenses are used for commercial condos to calculate NOI? Will it be the same as calculating for multi-units or residentials? Thanks.
I noticed you did not get any feedback to your question. I am a CPM with quite a bit of experience managing retail, and would be glad to help with specific answers if I can be of help.
Drop me a line and let me know.
Roadster,
Yes the calculation would be the same… although (bet you knew that was coming)…
I’d just fiddle with the vacancy factor… really in the end try to do a IRR (internal rate of return) calculation to try and factor in lease escalations, lease expirations, time of vacancy (longer typically than an apartment but less frequent), your expenses (leasing, maintenance if not NNN)…
The NOI calculation is the same, but the investing approach is usually a little different (or at least with the commercial buyers I’ve worked with in the past).
Hope this helps,
Starke