Downtown Billings Office
For Sale
Contact for pricing
2823 2nd Ave N, Billings, MT 59101
Second floor office space in the Fratt Building.
Property Size7,945 SF
Price / SF$120.83
Days on Market169
Property Features for 2823 2nd Ave N
General Information
Standard status
Active
Size
7,945 SF
Class
B
Property subtype
Office
Zoning
CBD-Central Business District
Occupancy
83%
Building Details
Year Built
1923
Buildings
1
Stories
1
Units
1
Tenancy
Multi
Listing Agency:
NAI Business Properties
(406) 256-5000
Listed By:
Tyler Samson · License #MT RRE-RBS-LIC-25433
Source:
Crexi
Added: Mar 5
Changed: Aug 8
Last Checked: Aug 20 at 1:58PM
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 NAI Business Properties
Investment Insights
Based on property information with market context.
The entire second floor of The Fratt Building, located in downtown Billings, is available for sale. The property offers 7,945 square feet of office space.
Key Highlights
- Entire second floor of The Fratt Building
- Located in the heart of downtown Billings
- For sale (ownership opportunity)
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
$87,093
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
9.07%
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%
$1,741,860
$1.7M
Cap Rate 7%
$1,244,186
$1.2M
Cap Rate 9%
$967,700
$967.7K
Market Conditions
NOI Build-Up for 7,945 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
$138.2K $17.40/SF
− Vacancy
−$22.1K −$2.78/SF
EGI
$116.1K $14.62/SF
− OpEx
−$29.0K −$3.65/SF
NOI
$87.1K $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%
$1,741,860
Cap Rate 7%
$1,244,186
Cap Rate 9%
$967,700
Alternative Uses
Best Use
Office B
$1.24M
$1.09M – $1.45M
NOI $87,093 @ 7.0% cap · market cap 9.07%
Second Best
—
—
no second resolved use
Theoretical Best
Office A
$1.73M
$1.52M – $2.02M
NOI $121,349 @ 7.0% cap · market cap 12.64%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
3,700
Businesses Nearby
Explore this area
Business Placement
Demographics for 59101, MT
41,522
Population
18,864
Households
2.2
Avg Household Size
37
Median Age
22%
College-Educated
91%
High-School Grad
590.8 sq mi
ZIP Area
70
Density / Sq Mi
$58,165
Median Household Income
$36,258
Median Earnings
$930
Median Rent
$243,000
Median Home Value
Market
Vacancy Rate% for Office in West 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?
Office building - Second floor office space in the Fratt Building.
Where is this office building located?
The property is located at 2823 2nd Ave N Billings, MT.
What is the asking price?
The asking price for this property is $960,000.
What are key features of this property?
This property features: Entire second floor of The Fratt Building; Located in the heart of downtown Billings; For sale (ownership opportunity)
