Tornado Alley (PROG)

[hap0206]

Valuing commercial RE is simple arithmetic -- say you are looking at purchasing a building -- let's say it has 40k s/feet of rental space rented at $8 per year -- you would like to earn 8% on your money -- 40ksf x $8 = $320,000/yr -- $320k/ divided by 8% = $4,000,000 -- so that is what the property to you is worth -- adjusted of course for vacancies, etc