A seller claims $252,000 annual NOI on a commercial property. The speaker demands proof, then calculates the DSCR on a $2.1 million loan at 7.5% interest over 25 years to verify the property can actually cover the debt payments.
Let's redo the economics on it real quick. We want to rewrite the economics. We understand that they're saying it's a 6 cap, and that's why they're justifying the $252,000 NOI at that price. We need proof that the NOI is $252,000 a year. And then what we want to do is we want to know if we did a $2.1 million commercial note, what is our DSCR based on that NOI? And the 2.1 is going to be at 7.5% interest over 25 years, commercial note, and it's a balloon.
