Investor · Boise ID · Member since 2014 · 113 posts · 25 votes
So I am buying my first commercial property. I have been investing in 1-4 unit properties for about 10 years. Now its time to step up to the next level. I am closing on a triplex that I own in 2 weeks and have started my search for a replacement property. I'm looking for B/C class properties 5 to 15 units preferably mostly 2 bed units with pitched roofs in MSAs with good job and population growth purchase price between $400k and $900k and a cap rate of at lease 7%. Also Looking for commercial lenders that would finance this type of property. Any advice or tips would be greatly appreciated. Anything I should watch out for.
Real Estate Investor · Smithtown, NY · Member since 2013 · 65 posts · 26 votes
8y
Dustin, keep your foot on the pedal and do not let off. The 45 day identification period will fly. Also, you will need cash for certain closing costs, DD and loan costs ad many of these expense items are not 1031able. Your QI and CPA should keep you aware of that. Best of luck!
Real Estate Investor · Smithtown, NY · Member since 2013 · 65 posts · 26 votes
8y
Dustin, keep your foot on the pedal and do not let off. The 45 day identification period will fly. Also, you will need cash for certain closing costs, DD and loan costs ad many of these expense items are not 1031able. Your QI and CPA should keep you aware of that. Best of luck!
Investor · Morrisville, NC · Member since 2012 · 1k+ posts · 673 votes
8y
@Dustin S. I think you usually want to have a replacement property first before you sell your current one. The reason is you have more control over the sale of your than the purchase of the other property. In case you can't find a replacement, you might find yourself paying lots of taxes.
Make sure to get on as many lists as possible to notify you for properties to purchase. If you don't know many brokers yet, make sure to search loopnet and connect with brokers there. Network, network, network.
If you are going to buy out of state, you might need to use banks in the states you are buying. Since you don't know that yet ... oh well !!!
Developer · Philadelphia, PA · Member since 2015 · 2k+ posts · 904 votes
8y
@Dustin, if you are looking for passive investments but want to benefit from scale, you may also want to look into DSTs and the new " Opportunity Zone Funds ".
From what I understand of Opportunity Zone Funds, you can invest ANY capital gains into it not just ones from real estate. Very powerful !
Financial Advisor · Los Angeles, CA · Member since 2018 · 77 posts · 7 votes
8y
@Dustin S. if you do not want to have to buy another property within the timelines there is an alternative. Reach out to me if you would like more info. They will allow you to sell your property, defer the tax, and buy properties over time, if you like.