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To: marginmike who wrote (5940)	5/9/2004 7:33:48 PM
From: yard_man	Read Replies (1) \| Respond to of 116555

what does 30% below market mean on a $3.5M property -- you say it has a tenant -- are there really that many comparables in the area?? Single tenant is a concentrated risk, IMO. Oh well -- you posted it -- thus you get .02 from people who know very little of the particulars and really can't advise you -- but continuity of income from the tenant seems like your biggest risk. You know, what constitutes force majeure or any other important provisos on the lease if it is a long term contract the tenant has signed??

To: marginmike who wrote (5940)	5/9/2004 8:04:05 PM
From: Elroy Jetson	Respond to of 116555

When buying an income property it's most important to determine what will happen upon roll-over at lease renewal time. When the existing rent payments are significantly above current market, the value of the building will obviously decline significnatly at lease renewal. This is a far more significant factor than months vacant, even with a single tenant building. Institutional income property buyers will use a discounted 20 year income projection using programs like Pro-Ject, Finsim, Argus, RealData, or Office2.