Episode #019 - What to watch out for when using Cap Rates to purchase Commercial Real Estate!
On this Episode of How to Invest in Commercial Real Estate we have Brian Duck and Braden Cheek from The Criterion Fund, & Joel Thompson from Precision Equity going over what you should watch out for when using cap rates to evaluate commercial real estate deals.
Topics discussed:
1. What is the biggest thing that the cap rate does not consider?
2. What is negative leverage?
3. Evaluating why institutional investors choose to invest in better markets with smaller cap rates.
4. Cap Rates don't measure where the market rent is. The cap rate may be lower but the income may be under market or could be improved through renovation.
5. The preferred method for underwriting Commercial Real Estate Investments or properties. Internal Rate of Return (IRR).
*Be Sure to check us out on Spotify and Apple Podcasts for the Audio version of today's episode!** https://open.spotify.com/show/08KmNvqGV5HjmHUC8fLuce | https://podcasts.apple.com/us/podcast/how-to-invest-in-commercial-real-estate/id1543470290?itsct=podcast_box&itscg=30200
Links mentioned in this episode:
Invest.HowToInvestInCRE.com | www.TheCriterionFund.com | www.HowToInvestInCRE.com
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