Commercial property Creative Finance
I want to buy a 10000 sqft 5 unit commercial building but the owner wants to back out and keep leasing. The owner is 80+ and just cant give it up. The price to sell is $450k. It currently brings in $4500 a month with potential for $6000. What could I offer the seller in terms of a creative deal where he could be convinced to sell? Lease to own ? What else is there?
#1 All Forums Contributor
- Investor
- Northern Virginia
Quote from @Devon Daniels:
I want to buy a 10000 sqft 5 unit commercial building but the owner wants to back out and keep leasing. The owner is 80+ and just cant give it up. The price to sell is $450k. It currently brings in $4500 a month with potential for $6000. What could I offer the seller in terms of a creative deal where he could be convinced to sell? Lease to own ? What else is there?
First find out why he will not sell, in order to come up with creative financing you need to understand why he is not selling and come up with something from there. If its because he does not want to sell and pay capital gains on it then maybe he seller finances it to you. First find out what the issue is then come up with a resolve.
#4 Buying & Selling Real Estate Contributor
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- Tampa, FL
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#4 Buying & Selling Real Estate Contributor
- Lender
- Tampa, FL
I grew up in a small farm town in IL. My family settled the land in 1831 and my mother, who owns it now, is 6th generation. I would NEVER sell it. I grew up there and have fond memories of my family on that land. It's home. Investors rightfully look at an investment problem as a simple math problem with no emotion, but they often forget that logic exits the equation when emotional attachment is involved. If he is to sell, he likely wants to sell it to someone that's going to love the property like he did. If he thinks your going to level it for a parking lot or not love it like he did, it's going to be hard to convince him to sell to you. Good luck with your transaction.
#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
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#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
Old people don’t find creative finance appealing, especially long-term. A common rebuttal I get is, “I am going to die before you pay me in full”. If you are comfortable with a very short term balloon, you may be able to structure owner finance.
Quote from @Devon Daniels:
I want to buy a 10000 sqft 5 unit commercial building but the owner wants to back out and keep leasing. The owner is 80+ and just cant give it up. The price to sell is $450k. It currently brings in $4500 a month with potential for $6000. What could I offer the seller in terms of a creative deal where he could be convinced to sell? Lease to own ? What else is there?
Maybe ask if he would like to partner with you and for first right of refusal if'/when he get's tired of fixing the plumbing!
Thanks for your advice.