$1.9 in commercial real estate for only $10,000 invested.

1 Reply

Investment Info:

Industrial commercial investment investment.

Purchase price: $1,500,000
Cash invested: $10,000
Sale price: $1,500,000

Set up a short term business partnership LLC agreement with owner to for purpose of obtaining a bridge loan with a non bank lender and to be added to title for seasoning. Seller net of $ 1.2M. Use bridge funding on subject property to improve value and move to term financing with an ARV of $1.9M. Refinance with commercial bank with cash-out under 75% LTV. $10,00 for appraisal, Phase 1 and fees. Upon refinance, cash out of $200,000 (tax exempt; debt) and retain monthly cash flow of $8000 mo.

What made you interested in investing in this type of deal?

Seller was willing to owner finance or to form partnership. Excellent existing tenants. Strong cash flow. Repairs necessary.

How did you find this deal and how did you negotiate it?

Contacted seller directly regarding interest in another property.

How did you finance this deal?

Bridge and commercial.

How did you add value to the deal?

Took over repairs and negotiations with contractors.

What was the outcome?

$200,000 in cash tax exempt and $8000 a month in cash flow.

Lessons learned? Challenges?

Shop, shop and shop all lenders. Ask about options for partnerships and partnership buy-outs.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I am a Real Estate professional.

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