Please see these Instructions, CBRE Market Report, property listings and SFFA Student Template for information to calculate a preliminary offer for each site.
Required: Please come up with an Offer Price for SFFA1:129-02 Northern Blvd., Flushing based on the Instructions
INSTRUCTIONS
Rental Rates:
Use the CBRE report from 2Q 2020 to find the average rental rate in each neighborhood.
You may adjust these rates, up or down, 0% to 30% based on perceived differences in the Subject Property (For instance, the property can be state-of-the-art by NYC infill standards, and therefore appeal to a wide range of top, national, e-commerce sellers.)
It is probably safe to assume that bidders for these properties would demolish existing improvements and construct a new Industrial building which would likely command premium rents, (15% to 30% higher than CBRE rates.)
Financing Costs:
Assume buildings greater than 150,000sf would be more competitively financed by institutional lenders, offering 6.5% rate, on a 20 year amortizing mortgage, with a 10 year term. Also, 80% LTV with 1.2x DSCR
Smaller buildings could typically find an 8.25% rate on a 15 year amortizing mortgage, also with a 10 year term. Also, 70% LTV, with 1.3x DSCR.
Construction (excluding land):
Construction costs in NYC tend to be the highest in the US across all property types, including Warehouse/Industrial.
Multistory Industrial was recently built in Seattle and Los Angeles, and NYC is viewed as the next major infill market to benefit from this trend.
Construction costs (excluding land) currently range from $125 psf for multistory buildings above 250,000 sf, to $105 for traditional, single story.
Non Reimbursed Expenses
Developers/landlords should expect to pay $0.75 psf per year.
Site Specific Notes:
SFFA1: 129-02 Northern Blvd, Flushing Assume FAR (Floor Area Ratio) of 4.0 on the total square footage and assume Industrial is permitted as-of right.
