We’re going to look at a sale offer of a commercial office building and we’re going to dissect the viability of this offer.
The seller in this case is offering to sell a property that has an as-is appraisal for nine million dollars from a major brand name commercial brokerage house and appraisal firm.
The seller purchased the building a couple of years ago for 5 million dollars. He is willing to seller finance the building with $750,000 in secured debt and another $2.25M in forgivable debt that would be unsecured.
The offering prospectus has a plan to convert the building to residential, and the assertion is that the building would be worth $17M after the conversion is complete and leased up and stabilized.
The building is currently 50% occupied.
The question is whether this offer is a good deal?
Host: Victor Menasce