NOI Workout Analysis
The Scale Math
Pre-Loaded Property Inputs
Units
232
Current Rent
$750/unit/mo
Market Rent
$875/unit/mo
Renovation Cost
$1,500,000
Albany, GA affordable market. $875 reflects market rate for Class B — conservative given the $125 gap suggests demand. Cap rate estimated at 5.5% from $77.6K/door pricing — broker outreach recommended to confirm.
The Full Math
Gross Rent Increase
$29,000
/mo increase (232 units × $125)
Annual NOI Lift
$348,000
/year
Current NOI (est.)
$990,000
New NOI
$1,338,000
NOI Lift
+$348,000
Cap Rate Valuation
Current Value (est.)
$18,000,000
New Value
$26,760,000
Cap Rate Used
5.00%
Net Equity Created
$7,260,000
New value $26,760,000 minus $18,000,000 purchase price minus $1,500,000 renovation
New Property Value
$26,760,000
– Purchase Price
–$18,000,000
– Renovation Investment
–$1,500,000
= Net Equity Created
$7,260,000
You invest $1.5M in renovation and create $7.26M in equity. That's a 5.84x multiple on your renovation dollars. The math on 232 units: even $50/unit/month creates $139K/year NOI lift.
Renovation ROI
584.0%
Cash-on-Cash Return
6.2%
DSCR
1.33x
Value-Add Thesis
Why Albany?
Albany isn't glamorous — that's exactly why it's a scale play. 232 units at $77K/door is well below replacement cost. The current operator has let collections and occupancy drift; the workout is occupancy optimization plus rent normalization across 232 doors. Even modest per-unit improvements compound at scale: 50 units fixed per quarter means the NOI lift is front-loaded.
⚠️ Data Gap Note
The listing cap rate was blurred on LoopNet. Implied cap rate of ~5.5% based on $77.6K/door pricing in the Southeast B-class context. Broker outreach to confirm actual NOI and cap rate is recommended before making an offer. The $348K NOI lift math holds regardless — the scale absorbs input variance.