Updated Flex Building with
For Sale
$1,250,000
Pending
1040 Manchester Street, Lexington, KY 40508
COMMERCIAL - Lexington, KY
Property Size11,578 SF
Lot Size0.80 Acres
Days on Market122
Property Features for 1040 Manchester Street
General Information
Property type
Commercial Sale
Property subtype
Other
Zoning description
I-1 Light Industrial
Subdivision
Commercial
Directions
Manchester Street outbound, the property will be on your left.
Standard status
Pending
APN
14101654
Size
11,578 SF
Lot size
0.80 Acres
Amenities
conference rooms
copy room
backup generator
Building Details
Year built
1976
Floors in Building
1
Building materials
Block
Roof type
Shingle
Listing Agency:
Block + Lot Homes
(859) 309-0099
Listed By:
Gregory Leveridge · License #215416
(859) 421-8959
Added: Apr 13
Changed: Aug 4
Last Checked: Aug 12 at 7:06AM
MLS# 26010653
Copyright © 2026 ImagineMLS. All rights reserved. All information provided by the listing agent/broker is deemed reliable but is not guaranteed and should be independently verified.
Investment Insights
Based on property information with market context.
This 11,578-square-foot flex property combines polished office areas with rear warehouse space and loading dock access. The office component includes cubicle rooms, multiple conference rooms, copy space, and restrooms on each floor. Additional improvements include two walk-in coolers measuring 455 SF and 375 SF, a detached warehouse, and a detached garage. Extensive improvements were completed in 2014, and the building dates to 1976.
The property occupies approximately 0.8 acres on Manchester Street in Lexington, with parking and lot access for large truck deliveries and pickups. It is positioned near New Circle Road, Downtown Lexington, and interstate access. The site carries Light Industrial zoning (I-1) with an Adaptive Reuse Zoning Overlay and is enrolled in Kentucky's Brownfield Program. Building infrastructure includes 400 amp power and a Kohler diesel backup generator serving the entire building.
The property occupies approximately 0.8 acres on Manchester Street in Lexington, with parking and lot access for large truck deliveries and pickups. It is positioned near New Circle Road, Downtown Lexington, and interstate access. The site carries Light Industrial zoning (I-1) with an Adaptive Reuse Zoning Overlay and is enrolled in Kentucky's Brownfield Program. Building infrastructure includes 400 amp power and a Kohler diesel backup generator serving the entire building.
Key Highlights
- 11,578 SF flex building with office and rear warehouse space
- 0.8‑acre site with parking and lot access for large truck deliveries and pickups
- Light Industrial zoning (I‑1) with Adaptive Reuse Zoning Overlay
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
770
Businesses Nearby
Balanced
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.
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Frequently Asked Questions
What type of property is this?
Flex space - Office, warehouse, and loading functions are combined with coolers, backup power, and access for large truck deliveries.
Where is this flex space located?
The property is located at 1040 Manchester Street 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 with office and rear warehouse space; 0.8‑acre site with parking and lot access for large truck deliveries and pickups; Light Industrial zoning (I‑1) with Adaptive Reuse Zoning Overlay
