Visible Retail Building on
For Sale
$1,985,000
274 N US-31 S, Traverse City, MI 49685
Highly visible retail building with frontage on US-31.
Property Size8,250 SF
Lot Size2.90 Acres
Price / SF$240.61
Days on Market156
Property Features for 274 N US-31 S
General Information
Standard status
Active
Size
8,250 SF
Lot size
2.90 Acres
Property subtype
Commercial
Building Details
Year Built
1983
Listing Agency:
Three West LLC
(231) 620-5705
Listed By:
David J Frost · License #6501203019
Source:
Elliman
Added: Mar 10
Changed: Aug 8
Last Checked: Aug 8 at 4:46AM
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 Three West LLC
Investment Insights
Based on property information with market context.
This property features a highly visible 2.89-acre parcel with 414 feet of frontage on US-31 South and 304 feet on Sundowner Drive. The large, open retail building offers great visibility and easy access on US-31. The building encompasses 7,104 square feet with an additional 1,146 square feet on the second level, totaling 8,250 square feet. It includes four 14x14 overhead doors in the rear and a 16-foot ceiling height. Mezzanine offices overlook the sales floor. The property has been remodeled and provides ample parking with significant space for outside display. US-31 South recorded 25,600 cars per day in 2023. The property is currently leased to two tenants, generating an annual rental income of $158,244 NNN. One tenant is departing, and the other can be relocated, making the property ready for a new tenant or owner-occupied use.
Key Highlights
- High‑visibility location with 414 feet of frontage on US 31 South, seeing 25,600 cars per day.
- Significant income potential with current annual rental income of $158,244 NNN.
- Large, versatile 8,250 Sq Ft building.
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
$102,010
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
5.14%
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%
$2,040,200
$2.0M
Cap Rate 7%
$1,457,286
$1.5M
Cap Rate 9%
$1,133,444
$1.1M
Market Conditions
NOI Build-Up for 8,250 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
$158.4K $19.20/SF
− Vacancy
−$12.7K −$1.54/SF
EGI
$145.7K $17.66/SF
− OpEx
−$43.7K −$5.30/SF
NOI
$102.0K $12.36/SF
Area
Grand Traverse County, MI
Vacancy
8.00%
Lease Rate
$19.20 /SF/Yr
Expense Ratio
30.00%
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%
$2,040,200
Cap Rate 7%
$1,457,286
Cap Rate 9%
$1,133,444
Alternative Uses
Best Use
Retail
$1.46M
$1.28M – $1.70M
NOI $102,010 @ 7.0% cap · market cap 5.14%
Second Best
Office B
$1.26M
$1.10M – $1.47M
NOI $88,358 @ 7.0% cap · market cap 4.45%
Theoretical Best
Office A
$1.79M
$1.57M – $2.09M
NOI $125,453 @ 7.0% cap · market cap 6.32%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
247
Businesses Nearby
Explore this area
Business Placement
Demographics for 49685, MI
20,856
Population
9,395
Households
2.2
Avg Household Size
40
Median Age
38%
College-Educated
95%
High-School Grad
54.2 sq mi
ZIP Area
385
Density / Sq Mi
$82,639
Median Household Income
$45,783
Median Earnings
$1,338
Median Rent
$309,200
Median Home Value
Market
Vacancy Rate% for Office in Midwest region
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Retail space - Highly visible retail building with frontage on US-31.
Where is this retail space located?
The property is located at 274 N US-31 S Traverse City, MI.
What is the asking price?
The asking price for this property is $1,985,000.
What are key features of this property?
This property features: High‑visibility location with 414 feet of frontage on US 31 South, seeing 25,600 cars per day.; Significant income potential with current annual rental income of $158,244 NNN.; Large, versatile 8,250 Sq Ft building.
