Analyze a Property
Looking at a center?
Find out what it is worth.
Send the offering memorandum, the rent roll or the income statement on a property you are considering, or type the numbers in yourself. You get back a first-pass read: what the in-place income supports, what the asking price implies about it, and what is worth asking before you spend a weekend on the deal.
It is on screen in under a minute and in your inbox straight after, so you have something to forward to a partner or a lender, or to take back to the broker.
The offering memorandum
Whatever the broker sent over. The summary pages carry price, cap rate, NOI and size, and those are read straight out of the PDF.
The rent roll
Tenants, suite sizes and rents become occupancy, scheduled income and a tenant count. It is also the document that decides the deal.
The income statement
Gross income and operating expenses give the real NOI, and the expense ratio says whether anything has been left out of the seller’s version.
Own the center rather than looking at one? It works just the same on your own rent roll, though that conversation is usually better had properly: send it to us directly and we will go through it ourselves.
- Send it
- Check it
- Read it
Whatever the broker sent you. PDF, Excel or CSV, up to three files, 25MB each. Send all three if you have them: each one fills in something the others do not.
Nothing is recorded at this step. Your documents are read for the figures they contain and are not published anywhere.
The report
What comes back
A breakout of the property and a summary of what it means, in the order a person reads it: the figures as they were read, so a wrong one is obvious straight away, then what they imply, then what they say about the price being asked.
What the income supports
A value range built from the in-place income at the cap band centers like this one have been trading in, with a midpoint to start from.
What the asking price implies
The cap rate at the asking price, price per square foot, NOI per square foot, expense ratio. Whether the ask sits above the range, inside it, or suspiciously below.
What to ask before you go further
Rollover, rents against market, what is recovered through CAM, what capital the seller has deferred. The questions that decide the price.
Example report
Hypothetical center, illustrative figures
Neighborhood strip center, 30,000 sq ft
What the income supports
$3.64M to $4.14M
Midpoint $3.87M at a 7.75% cap. The $3.75M ask sits inside the range, a little under the midpoint.
The figures as read
- Asking price
- $3,750,000
- Net operating income
- $300,000
- Gross income / operating expenses
- $480,000 / $180,000
- Building size
- 30,000 sq ft, built 1986
- Occupancy
- 92%, 12 tenants
What they imply
- Cap rate at the ask
- 8.00%
- Price per sq ft
- $125
- NOI per sq ft
- $10.00
- Expense ratio
- 37.5%
What it is worth at each cap rate
| Cap rate | Value |
|---|---|
| 7.00% | $4,286,000 |
| 7.25% | $4,138,000 |
| 7.50% | $4,000,000 |
| 7.75% | $3,871,000 |
| 8.00% | $3,750,000 |
| 8.25% | $3,636,000 |
| 8.50% | $3,529,000 |
Shaded rows are the band centers like this one have been trading in, adjusted for occupancy, tenant count and building age.
What to ask before you go further
- Two tenants, 22% of the income, roll within 18 months. What have they said about renewing?
- In-place rents look below market on the inline suites. How much of the gap can be closed at renewal?
- Is the roof original to 1986? Ask for the last capital spend and any quotes on file.
- What does CAM actually recover, and is management included in the expense figure?
An example only. The property and every figure above are invented to show the layout of the report.
How it works out the price
- The arithmetic
- Net operating income divided by a cap rate. Every argument about value is an argument about the cap rate.
- The band
- What Southeastern Wisconsin strip centers have been trading in, moved for occupancy, tenant count and the age of the building.
- The output
- A range, with a midpoint to start a conversation from. Not a single number, which nobody can take into a negotiation.
- What decides it
- Where a property lands inside the range is the leases, not the building. That part is in the rent roll rather than in the arithmetic.
- What it costs
- Nothing, and no obligation follows it.
What it is not
- Not an appraisal
- No inspection, no comparable sales, and not prepared to USPAP.
- Not an opinion of value
- And not a broker price opinion or a comparative market analysis.
- Not advice
- Not tax, legal, accounting or investment advice, and not a recommendation to buy.
- As good as its input
- On an offering memorandum, the figures are the seller’s figures. Check them.
- Your documents
- Read for the figures they contain. Not published, not listed, not passed to anybody.
Indicative analysis only. Not an appraisal, tax opinion, or investment recommendation. It is a first read to help you decide what deserves a closer look, and it is worth exactly as much as the information it is based on. If you would rather send it to a person than to a form, email it over and we will go through it ourselves.
Analysis powered by BBG’s proprietary DealSignals tools.
Start with an introduction
Coffee, a walk around the property, or a call if that is easier.