Build the underwrite first

Price is not an opinion you form in the car. It is the output of a model you build before the appointment. That model, the underwrite, is the backbone of the listing package. The broker opinion of value (BOV) is the opinion stacked on top of it. The financials in the offering memorandum (OM) are the buyer-facing version of it. And every buyer and every lender will re-underwrite it anyway.

That last point decides everything. If your underwrite skips a cost the buyer's lender will find, the buyer finds it in week two of diligence and retrades. If yours already carries that cost, the retrade has nothing to attack. MaxLife Commercial's listing presentation promises a written BOV before the listing agreement is signed, so the underwrite has to exist before you ask for the listing.

Ownership, liens, and lease-level rights such as rights of first refusal (ROFRs) and estoppels are covered in Researching the Property and the Owner. This lesson starts from the numbers.

The inputs

Get these before you model:

Lease-by-lease abstract: one row per tenant, with rent, escalations, options, recoveries, and the clauses that hurt (co-tenancy, go-dark, exclusives, ROFR, termination rights)
Financials: a month-by-month T-12 plus two prior years, tied to the general ledger or bank statements
Expenses: tax bills, insurance policies and loss runs, service contracts, and two years of CAM reconciliations
Capex history: roof, HVAC, and paving, with ages and warranties
Retail tenants: sales and occupancy cost where the lease requires reporting

Florida trap: sales tax on commercial rent ended for rental periods beginning on or after Oct 1, 2025 (F.S. 212.031, repealed by HB 7031). Strip any rent-tax line from older T-12s and confirm no tenant is still being charged for current periods.

Here is the abstract for the example we will carry through the lesson. All numbers are illustrative, not market data: a 24,000 SF multi-tenant retail center in Seminole County, 100% occupied.

Suite	SF	Expires	Base rent per SF	Escalation	Recoveries	Watch item
A (anchor)	12,000	Aug 2031	$16.00	2.5% a year	NNN	Co-tenancy clause, two 5-year options
B (restaurant)	7,000	Nov 2027	$24.00	$0.50 per SF a year	NNN with CAM cap	Expires in 14 months, renewal at market
C (in-line)	5,000	Mar 2028	$12.00	Flat	Modified gross, base-year stop	Below-market rent, no options
Total	24,000		$17.50 blended			Base rent $420,000

In-place NOI versus normalized NOI

Use three labels and never blur them:

In-place NOI: what the T-12 shows
Normalized NOI: what a buyer or lender will underwrite from the same facts
Pro forma NOI: a projection

Your headline number is normalized NOI. Here is the bridge for the center. The owner's T-12 shows base rent of $420,000 and recoveries of $118,000 (gross $538,000), less $122,000 of expenses.

Line	Amount	Why
In-place NOI	$416,000	$538,000 less $122,000
Vacancy and credit loss, 3% of $538,000	-$16,140	Buyers and lenders commonly apply it even at 100% occupancy
Management fee, 4% of $521,860	-$20,874	Owner self-manages, lenders usually charge a fee anyway
Replacement reserves, $0.20 per SF	-$4,800	Many lenders deduct reserves from NOI
Reassessed taxes, net of 80% recovery	-$5,200	Bill assumed to rise from $52,000 to $78,000 on sale
Re-quoted insurance, net of 80% recovery	-$1,800	Premium assumed to rise from $24,000 to $33,000
Non-recurring items	-$6,000	T-12 includes a $12,000 termination fee (remove) and $6,000 of one-time legal (add back)
Recovery true-up	-$4,000	CAM cap on Suite B leaves cost unrecoverable
Normalized NOI	$357,186	14.1% below in-place

The math of the retrade: at a 7.0% cap, each $1 of NOI is worth about $14.29 of price. The $58,814 gap is $58,814 ÷ 0.07 = $840,200 of value. Show that bridge to the seller before a buyer does.

How to defend each line:

Management fee: underwriting guidance commonly cites 3% to 5% of effective gross income, often less on single-tenant NNN. Use what local lenders apply.
Reserves: commonly $0.10 to $0.25 per SF for retail, office, and industrial. State whether your NOI is before or after reserves and match your comps.
Taxes: the seller's capped bill is not the buyer's bill. Pull the county property appraiser's just value and current millage, and use the reassessed figure, as Lesson 3 explains. Date-stamp the tax line, because a November 3, 2026 ballot measure could change the cap.
Insurance: get a real quote on the actual roof age and construction. Do not inherit the seller's premium.
Rollover: add downtime, tenant improvements (TI), and leasing commissions for Suites B and C before a buyer does.

Pro forma, only with a real story. Use it when there is a documented value-add: a below-market lease expiring, vacancy with real prospects, an expense you can prove is fixable. Show it beside normalized NOI, list every assumption, and label it a projection, not a guarantee. Never make it the headline.

The lender lens and the financeable price

The financeable price is the price a lender will support at its target debt service coverage ratio (DSCR) and debt yield. Lenders size the loan at the lowest of three tests:

DSCR: NOI ÷ annual debt service, typically about 1.25x to 1.35x for retail and 1.20x to 1.30x for industrial
Debt yield: NOI ÷ loan, with floors commonly 8% to 10%
Loan to value (LTV): commonly 65% to 75%

These ranges come from lender marketing and glossaries. Confirm terms with two or three local lenders first.

Worked example (illustrative assumptions): 6.75% rate, 25-year amortization (annual constant about 8.29%), 1.25x DSCR, 9% debt yield, 65% LTV, price $5,100,000, lender NOI $357,186.

DSCR loan: $357,186 ÷ 1.25 = $285,749 of debt service, ÷ 0.0829 = about $3,447,000
Debt yield loan: $357,186 ÷ 0.09 = about $3,969,000
LTV loan: 65% × $5,100,000 = $3,315,000
Result: LTV binds. Loan $3,315,000, equity $1,785,000

How a weak underwrite becomes a retrade. Suppose the OM shows $416,000 and the seller asks $5.94M ($416,000 ÷ 0.07). The appraisal lands near $5.10M, so the loan is still about $3.315M. The buyer needs about $2.63M of equity, not $1.785M. That $840,000 hole is a price cut, a walk, or a blown closing. Present the financeable price as a range with the rate stated.

Special cases

Single-tenant NNN: the lease abstract is the underwrite. Value follows remaining term, credit, guarantor, escalations, and rent versus market. Test rent to store sales: roughly 6% to 8% is a common healthy rule of thumb for retail and quick-service tenants. A weak ratio raises dark and non-renewal risk, so check go-dark rights, radius restrictions, and whether the guaranty is corporate or franchisee.
Vacant building: model stabilized value (NOI ÷ cap rate) minus lease-up cost: downtime, TI, leasing commissions, free rent, and carry. Also price the owner-user exit, since a user does not need a lease-up discount.
Owner-user: impute market rent on the occupied space and show two values: investor value (imputed rent capitalized) and user value (often a price per SF). If the seller will stay as a tenant, that is a sale-leaseback and the lease terms become the underwrite.
Land: value by residual (finished value minus development cost and profit), cross-checked with closed sales in dollars per acre or per buildable unit, sorted by zoning and entitlements. Adjust for utilities, access, flood, and wetlands. A wetlands-mapper hit is a diligence flag, not a developable-acreage number. Portal asking averages are not comps.
Multi-tenant rollover: build an expiration schedule by year, with renewal odds, downtime, and TI and commissions for new versus renewal deals. Below-market rents are upside, above-market rents are risk.

Pricing: the BOV, not an appraisal

Florida lets licensed brokers give a price opinion in the ordinary course of business, but the opinion cannot be referred to or construed as an appraisal (F.S. 475.612). Only certified or licensed appraisers issue appraisals.

Avoid: "appraisal," "appraised value," "certified," "independent valuation," "guaranteed," and anything implying USPAP compliance
Use: "broker opinion of value," "estimated marketing range," "opinion, not an appraisal"

Put this at the foot of every page:

Broker opinion of value prepared by MaxLife Commercial. This is not an appraisal. Projections are estimates based on stated assumptions, are not guaranteed, and actual results may differ.

Method by asset type

Single-tenant NNN: direct cap on the lease, plus price per SF. Adjust for term, credit, escalations, and rent versus market.
Multi-tenant retail: direct cap on normalized NOI, plus price per SF. Adjust for anchor, occupancy, weighted average lease term, and rollover.
Industrial and flex: price per SF first, cap rate second. Adjust for clear height, dock doors, power, truck court, and office finish.
Medical office: cap rate and price per SF. Adjust for build-out, tenant mix, hospital affiliation, and term.
Land: price per acre or per buildable unit, adjusted for zoning, entitlements, utilities, and flood.

Use closed sales from about the last 12 months, not asking prices. Reserve a discounted cash flow for heavy rollover, real value-add, or an institutional buyer; it adds little to a single-tenant NNN.

NNN cap-rate drivers: remaining term, tenant credit, guarantor, escalations, lease type, rent versus market, ground versus fee, and location. Dated context: The Boulder Group's Q2 2026 report showed average asking cap rates of 6.82% for single-tenant net lease overall, 6.60% retail, 7.25% industrial, and 7.90% office. Corporate quick-service ran 5.85%, franchisee quick-service 6.85%, and premium ground leases 4.45%. Those are national asking rates, not closed Central Florida trades. The site's cap-rate pages add local context, but replace all of it with closed local comps before you show a seller.

Site tools

/cap-rates and /cap-rates/comps: local context and NNN comps
/cap-rate-calculator: NOI to value at the table
/deal-analyzer: check the buyer's likely return at your ask
/pdf-analyzer: read the seller's rent roll or a competing OM, then tie every number back to the source documents

Present a range, not a number

Sensitivity on the example, using illustrative cap rates:

Case	Cap rate	Value on normalized NOI $357,186	Value on in-place NOI $416,000
Aggressive	6.75%	$5,291,644	$6,162,963
Market	7.00%	$5,102,657	$5,942,857
Market, softer	7.25%	$4,926,703	$5,737,931
Quick-sale	7.50%	$4,762,480	$5,546,667

Read it this way:

Range: $4.76M to $5.29M, market midpoint about $5.0M
Aggressive: list there only with a call for offers and a dated price review
Quick-sale: for a 1031 deadline or loan maturity
Cap-rate swing: each 25 bps moves value roughly $165,000 to $190,000
NOI test: at 7.0%, a 5% NOI miss is about $255,000 of price. Run NOI plus or minus 5% and cap plus or minus 50 bps

The net sheet

The seller cares about proceeds, not price. Build the net sheet from the market case, label it an estimate, and rebuild it when the payoff quote arrives. The clean tool is the Seller Net Sheet Calculator.

Line	Estimate at $5,100,000	Basis
Sale price	$5,100,000	Market case from the range
Brokerage fee	-$204,000	Illustrative 4%, the same rate as the Lesson 6 worked example. Use your firm's actual proposal. Fees are negotiable, not set by law (Lesson 6)
Documentary stamps	-$35,700	$0.70 per $100 (F.S. 201.02): $5,100,000 ÷ 100 × $0.70. Seller-paid by custom and under the Florida Realtors commercial contract
Owner's title premium	-$15,300	Promulgated rate: $15,075 at $5M plus $2.25 per $1,000 above. The seller usually pays the owner's policy in Florida, so it belongs on the seller's sheet. Confirm against the contract and a local commercial title agent. Search and closing fees are extra
Loan payoff	-$2,400,000	Illustrative balance plus per-diem interest
Prepayment cost	-$48,000	2% step-down assumed. Yield maintenance or defeasance can cost far more and takes weeks. Request the quote at listing
Prorations, net	-$9,000	Taxes through the day before closing, collected rents only, deposits transferred, CAM true-up in the contract
Attorney, closing, recording, estoppel, lien search	-$12,000	Seller's own counsel and cure documents
FIRPTA withholding	$0	Foreign sellers only: buyer withholds 15% of the gross price, here $765,000, unless an exception or IRS certificate applies
1031 exchange	Not modeled	Qualified intermediary fee. Identify by day 45, close by day 180 (or the return due date if earlier). Engage the intermediary before closing
Estimated net before income tax	$2,376,000	$5,100,000 less $2,724,000 of costs

Every extra $100,000 of price nets about $95,075: $100,000 less $4,000 fee, $700 stamps, and $225 of title premium.

Rules for the sheet:

State assumptions: who pays title, the fee percentage, and the payoff date
Ask early: loan type and prepayment terms, entity status for FIRPTA, and whether the seller is exchanging
Stay in your lane: the sheet stops before income tax. Capital gain, depreciation recapture, and the Florida law points above go to the seller's CPA and attorney

When the seller wants more than the underwrite supports

Do not argue. Walk the bridge.

Start with the seller's number: ask what NOI and cap rate produce it.
Show the gap: in-place versus normalized NOI, then closed comps at the same term and credit.
Price the fix: if a renewal, a lease-up, or a cure would close the gap, offer to wait and do it.
Offer structure, not a lie: list at the aggressive number with a call for offers, a 45-day price review, and the quick-sale number in writing.
Refuse to inflate: never put unsupported NOI in the OM. Misrepresentation and concealment are discipline grounds under F.S. 475.25(1)(b), and buyers will find it anyway.
Be willing to lose it: an overpriced listing goes stale and the next broker reprices it.

Key takeaways

The underwrite comes first: the BOV and the OM are built on it, and every buyer and lender re-underwrites it
Lead with normalized NOI, and keep in-place and pro forma labeled and secondary
Every NOI dollar a buyer strips costs the seller about 1 divided by the cap rate in price
Size the financeable price at the lowest of DSCR, debt yield, and LTV, and show the rate you assumed
A BOV is an opinion of value, never an appraisal, and every page carries the disclaimer
Present a range with a cap-rate sensitivity table, then replace market context with closed local comps
Build the net sheet early, label it an estimate, and send tax questions to the seller's CPA

Next: Lesson 5 shows how to present the underwrite, the range, and the net sheet in the listing presentation.

The Underwrite, the BOV, and the Net Sheet