Klamath Falls · Mixed-use · Illustrative file
Klamath Main Mixed-Use
Three retail suites, four apartments above, one suite under market.
Elevation plate. Placeholder artwork — photography for this file is not published. The brand rules require the whole building, elevation-on, verticals corrected, and a drawing cannot make a claim about condition that a photograph would.
The building
A two-storey main-street building: three retail suites at grade and four one-bedroom apartments above. Klamath Falls prices at a wider going-in yield than the Rogue Valley, and this file shows why the wider yield is not a free lunch.
One retail suite is meaningfully under market on a lease with two years left. That is the only identified upside, and it is worth what it is worth in two years, not today.
- Market
- Klamath Falls
- Asset type
- Mixed-use
- Units
- 7
- Built
- 1948
- Rentable area
- 4,870 sq ft
- Price per unit
- $74,286
Headline, in place
| Net operating income | NOI | Cap | DSCR | Cash-on-cash |
|---|---|---|---|---|
| -10% | $31,404 | 6.04% | 1.16x | 1.67% |
| -5% | $33,149 | 6.37% | 1.22x | 2.35% |
| In place | $34,893 | 6.71% | 1.29x | 3.03% |
| +5% | $36,638 | 7.05% | 1.35x | 3.71% |
| +10% | $38,383 | 7.38% | 1.41x | 4.39% |
The loan constant of 9.48% sits above the going-in cap rate of 6.71%, so leverage here is negative: each additional dollar of debt lowers both the cash-on-cash return and the coverage ratio.
At a 1.25x coverage floor this building supports a loan of about $294,320 — 57% of the asking price.
Rent roll
In-place rents are what the rent roll says. Market rents are an estimate and are labelled as such wherever they are used.
| Unit | Mix | Sq ft | In place | Market (pro forma) |
|---|---|---|---|---|
| Suite 100 | Retail, 940 sf | 940 | $1,050/mo | $1,350/mo |
| Suite 102 | Retail, 860 sf | 860 | $975/mo | $1,075/mo |
| Suite 104 | Retail, 910 sf | 910 | $1,200/mo | $1,250/mo |
| Apt 201 | 1 bd / 1 ba | 540 | $825/mo | $900/mo |
| Apt 202 | 1 bd / 1 ba | 540 | $825/mo | $900/mo |
| Apt 203 | 1 bd / 1 ba | 540 | $825/mo | $900/mo |
| Apt 204 | 1 bd / 1 ba | 540 | $825/mo | $900/mo |
| Total | 7 units | 4,870 | $6,525/mo | $7,275/mo |
Trailing twelve to net operating income
Operating expenses as reported, with management restated. Capital reserves and debt service sit below net operating income, not inside it — that is the definition this site publishes.
| Line | Annual | Note |
|---|---|---|
| Gross potential income | $78,300 | 7 units at in-place rent, twelve months |
| Vacancy and credit loss | ($5,481) | 7.0% of gross potential income |
| Effective gross income | $72,819 | The money that arrives |
| Operating expenses | ||
| Property taxes | ($7,900) | |
| Insurance | ($5,600) | |
| Water and sewer | ($3,900) | |
| Refuse | ($2,100) | |
| Common-area electric | ($1,900) | |
| Repairs and maintenance | ($7,400) | |
| Turnover | ($2,200) | |
| Administrative and legal | ($1,100) | |
| Management | ($5,826) | Restated to 8.0% of effective gross income |
| Total operating expenses | ($37,926) | 52.1% of effective gross income |
| Net operating income, in place | $34,893 | Definition |
| Below the line | ||
| Capital reserves | ($2,450) | $350 per unit per year. Not netted into the cap rate. |
| Annual debt service | ($27,126) | 55% loan to value, 7.25%, 20-year amortisation. Indicative, not a quote. |
| Cash flow after debt service and reserves | $5,318 |
Pro forma
Market rents across the rent roll are 11.5% above in place. Stated as a pro forma, separately, with the cost of getting there carried as cash rather than netted out of the yield.
Suite 100 rolls to market at expiry in 2028; the apartments follow at turnover. $18,000 of suite and common-area work is carried to get there.
Assumptions
- In-place rents are taken from the July 2026 rent roll and the three commercial leases.
- Operating expenses are the trailing twelve months, management restated to 8% of effective gross income.
- Vacancy and credit loss at 7% of gross potential income, reflecting the commercial component rather than the apartments.
- Capital reserves of $350 per unit per year sit below net operating income.
- Debt shown is indicative, not a quote: 55% loan to value, 7.25%, 20-year amortisation.
Go or no-go
Conditional
It covers debt at 55% leverage and not much above it. The file works if the retail holds; underwrite the exit before the entry.
Cash position at close
- Price
- $520,000
- Loan
- $286,000
- Closing costs
- $10,400
- Day-one capital
- $12,000
- Total cash in
- $256,400
Contact
Contact Ryan McMillan
Send us the building. You get a written analysis whether or not you transact, and whether or not you transact with us.
Ryan McMillan, Broker, OR #201262100. Brokered by eXp Realty. The first substantive conversation about a specific property is a licensed act and belongs to the broker.