found an investment property with 4 units (2 commercial, 2 apartments) List price is 1,495,000. Gross income from 3 rented units (2 commercial, 1 apt) is 119k. Net operating income is 101k. Cap rate around 6%.

I also own a small business that could use a storefront if I decide to grow it.

Given that I could rent the second apartment for roughly 800/month. I see NOI increasing to 109k.

Is there something I am missing here or should I be racing to get the loan in place and buy this?

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Assuming a DSCR rate of 8.5% with 25% down (for mixed use), your DSCR could be significantly below the 1.2 threshold. Your projected NOI is barely enough to cover the debt making it a high risk investment

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If you’re comfortable with growth in the area, I would bring the purchase price below $1.25M, increase rents and increase amortization beyond standard 25-year period

smart

Have you seen the proforma?

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Doesn’t sound appealing at all unless you like the unit for your business and you place a significant down payment. Cash buyers are the only ones making money with such a small cap rate given the interest you’ll be paying.

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