Building Details

Year Built 1955

Buildings 1

Stories 2

Tenancy Multi

Listing Agency: Consulting, Management & Realty Associates LLC Show Phone

Listed By: Beth Wentzlaff · License #MN 20396394

Source: Crexi

Added: Mar 21, 2023 Changed: Aug 17 Last Checked: Aug 19 at 2:12PM

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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 Consulting, Management & Realty Associates LLC

Investment Insights

Based on property information with market context.

The property features a 7,688 square foot building constructed in 1955, situated on 2.3 acres. It benefits from extraordinary visibility and a daily traffic count of 19,200 vehicles in 2021. The location is approximately 1/2 mile from Duluth International Airport. The property includes cross easements for easy access to a controlled intersection. It is currently occupied by multiple tenants, including a lot lease for an auto dealer and a shed dealership. The property is professionally managed by CMRA, LLC.

Key Highlights

• Extraordinary visibility with high traffic count of 19,200 daily in 2021.
• Large 7,688 sq ft building on 2.3 acres.
• Multi‑tenant structure with existing leases, currently housing an auto dealer and shed dealership.

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

$106,644

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

8.20%

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%

$2,132,880 $2.1M

Cap Rate 7%

$1,523,486 $1.5M

Cap Rate 9%

$1,184,933 $1.2M

Market Conditions

NOI Build-Up for 7,688 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

$191.9K $24.96/SF

− Vacancy

−$49.7K −$6.46/SF

EGI

$142.2K $18.50/SF

− OpEx

−$35.5K −$4.62/SF

NOI

$106.6K $13.87/SF

Area

St. Louis County, MN

Vacancy

25.90%

Lease Rate

$24.96 /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%

$2,132,880

Cap Rate 7%

$1,523,486

Cap Rate 9%

$1,184,933

Alternative Uses

Best Use

Mixed Use

$2.49M

$2.17M – $2.90M (±1% cap)

NOI $173,967 @ 7.0% cap · market cap 13.38%

Second Best

Office B

$1.52M

$1.33M – $1.78M (±1% cap)

NOI $106,644 @ 7.0% cap · market cap 8.20%

Theoretical Best

Specialty Retail

$2.98M

$2.61M – $3.48M (±1% cap)

NOI $208,761 @ 7.0% cap · market cap 16.06%

Zoning and permitted uses should be independently verified with authorities.

Property Analytics

Property Profile

Current Use

Mixed-use properties

Suggested Use

Top Pick Parking Lot & Garage HVAC Service Electrical Service Plumbing Service Furniture & Home Goods (Bike/Boat/Book/etc) Store

Score = modeled unmet demand for each use within ~1 mi (higher = bigger opportunity). Zoning and permitted uses should be independently verified with local authorities.

Location Intelligence

Trade Area within ½ mile

392

Businesses Nearby

Explore this area Business Placement

Demographics for 55811, MN

27,761

Population

11,640

Households

2.4

Avg Household Size

40

Median Age

41%

College-Educated

96%

High-School Grad

64.5 sq mi

ZIP Area

430

Density / Sq Mi

$77,877

Median Household Income

$38,284

Median Earnings

$1,339

Median Rent

$299,300

Median Home Value

Market

Vacancy Rate% for Office in Midwest region

13.7% 2019

15.6% 2020

17.1% 2021

18.9% 2022

21% 2023

22% 2024

21.3% 2025

Questions? Ask Rey

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What type of property is this? Where is this mixed-use properties located? What is the asking price? Find similar properties ... What are key features of this property?

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Frequently Asked Questions

What type of property is this?

Mixed-use property - 7,688 SF mixed-use building with high traffic visibility.

Where is this mixed-use property located?

The property is located at 4891 Miller Trunk Hwy Hermantown, MN.

What is the asking price?

The asking price for this property is $1,300,000.

What are key features of this property?

This property features: Extraordinary visibility with high traffic count of 19,200 daily in 2021.; Large 7,688 sq ft building on 2.3 acres.; Multi‑tenant structure with existing leases, currently housing an auto dealer and shed dealership.