As many of you know, multifamily caps are extraordinarily low in Manhattan and the surrounding boroughs. This holds true for properties where the majority of the units are rent stabilized. However, these types of properties provide a value-add opportunity for those that wish to hold for the long term (i.e. potentially longer than 5 years). Value is added through capital improvements, as well as unit renovations when units become vacant and marked to market.
Does anyone have any experience modeling these types of investment, and if so, could you kindly share your model?