What is the easiest way to come up with a lease rate on a build to suit?

I own the land but obviously would need to put in a cost for it and the building when calculating. I know this can be a complicated issue but I am just looking for a starting point
In Leasing Property - Asked by Brandon B. - Nov 5, 2008
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James B.
Corporate Investor
Orlando, FL

If you're building for a credit like Walgreen's it needs to be 9% or higher, if it's no credit 14%, that would be the range. You need to calculate in cost or value of the land, the projected costs of improvements, a development fee, and a contingency time the cap rate to get the rent.

Nov 5, 2008
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Chris S.
Coeur D'alene, ID

What is your required return?
Calculate the total cost of the project (land, site improvements, offsite, construction, entitlements, finance, etc) and utilize your required return to estimate an annual and monthly income figure. However, you also need to take into consideration the lease structure before you estimate the actual lease rate.

Jan 16, 2009
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