Updated Flex Space with Loading
For Sale
$1,250,000
Pending
1040 Manchester St, Lexington, KY 40508
Light industrial zoning, adaptive reuse overlay, and integrated office and warehouse areas support a range of business operations.
Property Size11,578 SF
Lot Size1.00 Acre
Days on Market215
Property Features for 1040 Manchester St
General Information
Standard status
Pending
Size
11,578 SF
Lot size
1.00 Acre
Property subtype
Commercial
Zoning
I-1
Site & Location
Highway Access
Yes
Road Access
Yes
Warehouse & Industrial
Power
400 amps
Cold Storage
Yes
Amenities
conference rooms
copy room
backup generator
Building Details
Year Built
1976
Year Renovated
2014
Buildings
3
Listing Agency:
Block + Lot Homes
(859) 421-8959
Listed By:
Gregory Leveridge · License #215416
Source:
Centralkyhomefinder
Added: Jan 29
Changed: Aug 29
Last Checked: Aug 29 at 8:42PM
Displayed information is deemed reliable but is not guaranteed and should be independently verified. All listing content including descriptions, pricing, images are the copyrighted material of Block + Lot Homes
Investment Insights
Based on property information with market context.
This 11,578 SF flex property occupies approximately 1 acre and combines finished office areas with warehouse functionality. The office portion includes cubicle rooms, multiple conference rooms, copy space, and restrooms on both floors. Rear loading dock access and an accessible lot accommodate large truck deliveries and pickups. Two walk-in coolers measure 455 SF and 375 SF, while a detached warehouse and detached garage provide additional utility. A Kohler diesel backup generator serves the entire building, supported by 400 amp power.
Built in 1976 and extensively improved in 2014, the property is zoned Light Industrial (I-1) with an Adaptive Reuse Zoning Overlay. Its Manchester Street address places it near New Circle Road, Downtown Lexington, interstate access, and the Distillery District. The property is also enrolled in Kentucky’s Brownfield Program.
Built in 1976 and extensively improved in 2014, the property is zoned Light Industrial (I-1) with an Adaptive Reuse Zoning Overlay. Its Manchester Street address places it near New Circle Road, Downtown Lexington, interstate access, and the Distillery District. The property is also enrolled in Kentucky’s Brownfield Program.
Key Highlights
- 11,578 SF flex building on approximately 1 acre
- Light Industrial zoning (I‑1) with Adaptive Reuse Zoning Overlay
- 455 SF and 375 SF walk‑in coolers
Financial Insights
Estimated NOI and Cap Rate
NOI = area × lease_rate × (100 − vacancy) / 100 × (1 − expense_ratio). Net Operating Income — what the owner takes home each year before mortgage payments and income tax. Effective rent (asking rent minus vacancy losses) minus operating costs (taxes, insurance, maintenance, management).
NOI / Yr
$92,385
Cap rate = NOI / list price × 100. Capitalization rate — annual return on a fully cash purchase, before financing. NOI divided by price. Higher means more income per dollar invested, but usually also more risk or older condition. 5–8% is typical for stabilized commercial property; double digits often signal distressed deals.
Cap Rate
7.39%
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$1,847,700
$1.8M
Cap Rate 7%
$1,319,786
$1.3M
Cap Rate 9%
$1,026,500
$1.0M
Market Conditions
NOI Build-Up for 11,578 SF
Vacancy — income lost from leasable area expected to sit empty during the year, subtracted from gross rent.
EGI (Effective Gross Income) — gross rent minus vacancy losses, the realistic income before paying operating costs.
OpEx (Operating Expenses) — recurring costs to operate the property (property tax, insurance, utilities, maintenance, management); excludes financing and capital improvements.
NOI (Net Operating Income) — income a property generates after operating costs but before financing and taxes.
Gross rent
$152.8K $13.20/SF
− Vacancy
−$10.7K −$0.92/SF
EGI
$142.1K $12.28/SF
− OpEx
−$49.7K −$4.30/SF
NOI
$92.4K $7.98/SF
Area
Lexington, KY
Vacancy
7.00%
Lease Rate
$13.20 /SF/Yr
Expense Ratio
35.00%
Simulate Cap Rate and NOI
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$1,847,700
Cap Rate 7%
$1,319,786
Cap Rate 9%
$1,026,500
Alternative Uses
Best Use
Office B
$1.85M
$1.62M – $2.16M
NOI $129,419 @ 7.0% cap · market cap 10.35%
Second Best
Flex RnD
$1.32M
$1.15M – $1.54M
NOI $92,385 @ 7.0% cap · market cap 7.39%
Theoretical Best
Office A
$2.41M
$2.11M – $2.81M
NOI $168,857 @ 7.0% cap · market cap 13.51%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Lease Details
Yes
Highway access
Yes
Paved road access
Location Intelligence
Trade Area within ½ mile
709
Businesses Nearby
Under-served
Demand for This Use
Explore this area
Business Placement
Demographics for 40508, KY
25,586
Population
11,458
Households
2.2
Avg Household Size
26
Median Age
36%
College-Educated
86%
High-School Grad
4.2 sq mi
ZIP Area
6,092
Density / Sq Mi
$28,040
Median Household Income
$13,316
Median Earnings
$900
Median Rent
$174,900
Median Home Value
Market
Vacancy Rate% for Office in South region
Questions? Ask Rey
Realmo’s AI knows this listing — price, zoning, demand, history. Ask anything.
Frequently Asked Questions
What type of property is this?
Flex space - Light industrial zoning, adaptive reuse overlay, and integrated office and warehouse areas support a range of business operations.
Where is this flex space located?
The property is located at 1040 Manchester St Lexington, KY.
What is the asking price?
The asking price for this property is $1,250,000.
What are key features of this property?
This property features: 11,578 SF flex building on approximately 1 acre; Light Industrial zoning (I‑1) with Adaptive Reuse Zoning Overlay; 455 SF and 375 SF walk‑in coolers
