Highway 27 Commercial
For Sale
$2,500,000
450 S Hwy 27, Somerset, KY 42501
2.3 AC site with income streams on Highway 27.
Property Size19,500 SF
Price / SF$128.21
Days on Market424
Property Features for 450 S Hwy 27
General Information
Standard status
Active
Size
19,500 SF
Property subtype
Retail
Building Details
Tenancy
Multi-Tenant
Listing Agency:
NAI Isaac
Listed By:
Zach Smith
(859) 333-8029
Source:
Kcrea.resimplifi
Added: Jul 15, 2025
Changed: Sep 9
Last Checked: Sep 11 at 4:39AM
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 Isaac
Investment Insights
Based on property information with market context.
The property features approximately 2.3 acres with direct frontage and access to South Highway 27 in Somerset, Kentucky. It includes an approximately 16,500 square foot freestanding, multi-tenant retail building and an approximately 3,000 square foot flex/garage building located at the rear of the site. A ground lease is in place with an auto tenant on a pad site. The site offers approximately 233 feet of direct frontage on Highway 27 and is adjacent to Advance Auto Parts and Tradewinds Center, which is anchored by Roses and Ace Hardware. The current gross operating income is $165,600. The property is zoned commercial and presents value-add and redevelopment potential, both short and long term. Somerset is located on US Hwy 27, 73 miles south of Lexington, Kentucky and 129 miles north of Knoxville, Tennessee. Somerset serves a regional trade area population of 195,000 plus. Lake Cumberland also provides considerable tourist/weekend shoppers.
Key Highlights
- Income‑producing property with a current Gross Operating Income of $165,600 and multiple revenue streams.
- +/-2.3 AC site featuring a +/-16,500 SF multi‑tenant retail building and a +/-3,000 SF flex/garage building.
- Excellent location with +/-233' of direct frontage on Highway 27 in Somerset, Kentucky.**
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
$222,288
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
8.89%
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%
$4,445,760
$4.4M
Cap Rate 7%
$3,175,543
$3.2M
Cap Rate 9%
$2,469,867
$2.5M
Market Conditions
NOI Build-Up for 19,500 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
$334.6K $17.16/SF
− Vacancy
−$17.1K −$0.88/SF
EGI
$317.6K $16.28/SF
− OpEx
−$95.3K −$4.89/SF
NOI
$222.3K $11.40/SF
Area
Pulaski County, KY
Vacancy
5.10%
Lease Rate
$17.16 /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%
$4,445,760
Cap Rate 7%
$3,175,543
Cap Rate 9%
$2,469,867
Alternative Uses
Best Use
Retail
$3.18M
$2.78M – $3.70M
NOI $222,288 @ 7.0% cap · market cap 8.89%
Second Best
Flex RnD
$1.99M
$1.74M – $2.32M
NOI $139,476 @ 7.0% cap · market cap 5.58%
Theoretical Best
Specialty Retail
$3.32M
$2.91M – $3.88M
NOI $232,549 @ 7.0% cap · market cap 9.30%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
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Open Analytics
Current Use
Location Intelligence
Trade Area within ½ mile
29
Businesses Nearby
Well-served
Demand for This Use
Explore this area
Business Placement
Demographics for 42501, KY
18,047
Population
8,039
Households
2.2
Avg Household Size
43
Median Age
17%
College-Educated
84%
High-School Grad
199.7 sq mi
ZIP Area
90
Density / Sq Mi
$49,449
Median Household Income
$38,121
Median Earnings
$808
Median Rent
$131,400
Median Home Value
Check the figures for this property
Cap Rate, Value Estimation, Potential NOI and more
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Market
Vacancy Rate% for Industrial in South region
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Frequently Asked Questions
What type of property is this?
Shopping center - 2.3 AC site with income streams on Highway 27.
Where is this shopping center located?
The property is located at 450 S Hwy 27 Somerset, KY.
What is the asking price?
The asking price for this property is $2,500,000.
What are key features of this property?
This property features: Income‑producing property with a current Gross Operating Income of $165,600 and multiple revenue streams.; +/-2.3 AC site featuring a +/-16,500 SF multi‑tenant retail building and a +/-3,000 SF flex/garage building.; Excellent location with +/-233' of direct frontage on Highway 27 in Somerset, Kentucky.**
