Investment Sale – Jason Griffith, CCIM, with NAI Utah South, assisted a client-investor purchase a 9,000 SF commercial retail strip center in Atlanta (Dacula), GA. The purchase helps the buyer complete part of a 1031 exchange requirement. The 100% leased retail center sold for $890,000 and will yield a true 8% CAP rate (capitalization rate) based on the current Net Operating Income. As some below-market rents are increased at the center, the CAP rate will increase a bit more.
The calculation of a proper CAP rate takes into account: reserves, property management, and a market vacancy factor. Proper underwriting of a commercial investment property is important to help investors determine a correct market value. Jason Griffith represents investors with acquisitions throughout Utah and the United States.