From the course: Introduction to Commercial Real Estate Analysis

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Downtown office case study

Downtown office case study

- [Instructor] Alright, welcome back. In this example, we're going to look at a downtown office example. So, this is going to be a large, multi-unit office. Quite different from the one we just saw. Alright, let's take a look at the synapsis. We're going to be purchasing and stabilizing a 87,000 square feet downtown Los Angeles Class C office building. It's currently Class C, but, you know, it's in a central location, it is old and needs some pretty major renovations to upgrade this space. So, we want to renovate it and take it to a B+ Class, which will take a little bit of effort. So, the asking price is $308 per square feet, so about 27 million. There's 12 floors. Floors one through four are leased, five through 12 are vacant. Unit sizes range from 250 to 7300 square feet. The average market rental rates are 4.50 for 500 square feet, 2.50 for 2500, 150 triple net for 7500 square feet. So, we're going to take these assumptions into our sampled deal. And some other assumptions that…

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