Cap rate in north Park Slope

A building that can be delivered vacant is not sold by cap rates. It is sold for the potential “best use”.
If you sell it baste on cap rate, the chances are an investor will buy it and flip it as a development site marketing it for its best use without doing anything other than marketing it to a different segment of the market.
IE: a five family delivered vacant with a cap rate 5-6% as suggested by dorkofwindsor may give you a price of $2,000,000. But marketed as a potential 1-2 family family restoration project (to make it your own), it may be is worth 3.5 million.
Real Estate is valued by location, location, location and by potential, potential, potential.
Long term rental income at this time is probably NOT its best use.
Delivered vacant there are multiple options for the next owner.

resident2

in General Discussion 8 years and 6 months ago

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starfish11040 | 8 years and 6 months ago

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I’m starting to think about selling my rental brownstone. The location is excellent – right near the Park and Grand Army Plaza. Any opinions on what the approximate cap rate should be if it’s delivered vacant?

lgwlcvqt | 8 years and 6 months ago

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Brooklyn seems to ignore cap rates for the most part and must realtors don’t even know the term.
With values exploding the past few years and NOI not going up in tandem, buyers often overlook low cap rates for upside and potential.
With regulated units, unrenovated units, and inefficient outdated mechanicals, properties cap rates are totally out of wack.

lgwlcvqt | 8 years and 6 months ago

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Brooklyn seems to ignore cap rates for the most part and must realtors don’t even know the term.
With values exploding the past few years and NOI not going up in tandem, buyers often overlook low cap rates for upside and potential.
With regulated units, unrenovated units, and inefficient outdated mechanicals, properties cap rates are totally out of wack.

dorkofwindsor | 8 years and 6 months ago

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For a single brownstone (small), its hard to say for sure. I’d say 5-6% but here is a comparison by borough:

https://commercial.jpmorganchase.com/pages/commercial-banking/services/ctl-chads-corner