I’m working on my 1st deal (it’s a HUGE deal) and I’m unsure on how to get investors. The owner and I had played around with the idea of seller financing. He decided it wasn’t in his best interest because he’s retiring and has been screwed before with seller financing. I wasn’t worried because I had an associate with a group of investors who seemed interested in the property. After looking at the property I emailed my associates the numbers I was allowed to (I haven’t signed the confidentiality agreement yet BUT the owner gave me each units rent and what they pay in CAM rent). It has been almost a week and they’re involved in other deals and I want to have some other investors in case they don’t follow through. Here’s some details on the property:
Property: Commercial Property (Shopping Center)
Combined Rents: $26,000
Combined CAM: $1800
Loans: Property has a loan of $1.2mil with a prepayment penalty of roughly $700k
ANY AND ALL advice would be great. Thanks!
I also forgot to add! The property is for sale for $4.7mil
Start with seeing if the loan can be assumed, depending on the interest rate and other terms. This may save you a headache because banks are getting more nervous about the economy and may clamp down on lending.
What are the terms of the lease? Is it triple net, meaning the tenant has to pay taxes, utilities, maintenance? Have you been able to calculate cash on cash returns and IRR?
@Michael Jones Thanks for responding. The owner and I have spoken about the loan, it is assemble. If I went that route, I'd still have to find the funds for the rest of the price. I can't see the leases yet until I sign the confidentiality agreement. I haven't because to be completely honest I'm not sure if I need an attorney or can sign it myself. &I'm still doing the math on the cash on cash &IRR. Trying to make sure my investors (if I'm lucky enough to get one or more) get their return and I still make some type of profit.
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