7-Office Commercial
For Sale
$400,000
1540 Lake Elmo Dr, Billings, MT 59105
Office condominium with private workrooms, reception, two restrooms, and a full kitchen or break area.
Property Size1,980 SF
Price / SF$202.02
Days on Market58
Property Features for 1540 Lake Elmo Dr
General Information
Standard status
Active
Size
1,980 SF
Taxes and HOA fees
Annual Taxes
$980
Listing Agency:
Meridian Real Estate LLC
(406) 208-4003
Listed By:
Lauraleah Griffin · License #RRE-BRO-LIC-98920
(406) 208-4003
Source:
Exprealty
Added: Jun 15
Changed: Aug 10
Last Checked: Aug 11 at 10:30AM
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 Meridian Real Estate LLC
Investment Insights
Based on property information with market context.
This 1,980-square-foot commercial condominium is arranged for professional office use, with seven private offices supported by a reception area, two bathrooms, and a full kitchen or break room. The layout provides distinct work areas along with shared support space within a single office unit.
Located at 1540 Lake Elmo Dr in Billings, Montana, the property may accommodate an owner-user or an investor seeking an office asset. Its existing configuration offers a practical starting point for businesses requiring multiple enclosed offices and on-site staff amenities.
Located at 1540 Lake Elmo Dr in Billings, Montana, the property may accommodate an owner-user or an investor seeking an office asset. Its existing configuration offers a practical starting point for businesses requiring multiple enclosed offices and on-site staff amenities.
Key Highlights
- 1,980‑square‑foot commercial condominium
- Seven private office spaces
- Receptionist area included
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
$21,705
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
5.43%
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%
$434,100
$434.1K
Cap Rate 7%
$310,071
$310.1K
Cap Rate 9%
$241,167
$241.2K
Market Conditions
NOI Build-Up for 1,980 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
$34.5K $17.40/SF
− Vacancy
−$5.5K −$2.78/SF
EGI
$28.9K $14.62/SF
− OpEx
−$7.2K −$3.65/SF
NOI
$21.7K $10.96/SF
Area
Billings, MT
Vacancy
16.00%
Lease Rate
$17.40 /SF/Yr
Expense Ratio
25.00%
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%
$434,100
Cap Rate 7%
$310,071
Cap Rate 9%
$241,167
Alternative Uses
Best Use
Office B
$310.1K
$271.3K – $361.8K
NOI $21,705 @ 7.0% cap · market cap 5.43%
Second Best
—
—
no second resolved use
Theoretical Best
Office A
$432.0K
$378.0K – $504.0K
NOI $30,242 @ 7.0% cap · market cap 7.56%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
127
Businesses Nearby
Explore this area
Business Placement
Demographics for 59105, MT
33,310
Population
14,198
Households
2.3
Avg Household Size
37
Median Age
30%
College-Educated
96%
High-School Grad
95.9 sq mi
ZIP Area
347
Density / Sq Mi
$74,572
Median Household Income
$44,359
Median Earnings
$1,261
Median Rent
$314,900
Median Home Value
Market
Vacancy Rate% for Office in West region
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Office units - Office condominium with private workrooms, reception, two restrooms, and a full kitchen or break area.
Where is this office units located?
The property is located at 1540 Lake Elmo Dr Billings, MT.
What is the asking price?
The asking price for this property is $400,000.
What are key features of this property?
This property features: 1,980‑square‑foot commercial condominium; Seven private office spaces; Receptionist area included
