If you consider that Property Management companies typically charge a placement fee in addition to the monthly fee it could be. Find out what the placement fee would be if a tenant were to be placed at the current rate. Then consider that fee in your cap rate calculations. Also make sure that if you do not want to keep the services of the management firm that the cancellation fee (if any) is given consideration prior to the close of escrow.
One more thing to consider is the quality of a tenant. It looks like this might be a new tenant with a limited payment history. You should consider asking the management company that placed the tenant to explain their screening process and criteria.
Good luck with all your Real Estate ventures...
Jun 26, 2009