All Forum Posts by: Ash Patel

Several months ago, I sold a property on land contract.  Shortly after, I received two property violations from the city.  One for a tire on the side of the house and the other for a vehicle parked on an unimproved surface.  I emailed the building department and explained this property was sold on land contract and emailed them a copy of it.  Their reply was that I would have to record the land contract for them to recognize it.    

I mailed the land contract to my Title Attorney and asked him to record it.  He told me that it "should be notarized" to be recorded.  He was going to submit it and that was the end of it.

Fast forward six months and I received another email from the building manager telling me that the land contract was never recorded and that I needed to address the property violations.  He also accused me of renting the property and failing to register the rental and pay for a rental inspection from the city.

I am awaiting a response from my Title Attorney regarding if the contract was recorded.  My question is am I obligated to record it and should an executed contract be enough for the building dept?

@Diane G., I think you need to be more respectful of the time and input these experts are giving to you.  I have mentored people over the years and like most mentors, I will match my time to people's efforts.  If someone will do the self-study/research that I ask, I will give them my all.  For each person willing to put the effort in, there are dozens who want to be players but don't want to grind.   

I get that you want to educate yourself, but put in the grind and spend days reading the commercial forums.  This way you can ask the type of questions that justify people spending time on a response.  Don't forget this is a networking opportunity, you don't want to insult people that are willing to help you.

WOW!!!!  What an education on commercial real estate!  If you want to learn more from experts go to the forum posts by @Jessica Zolotorofe and @Joel Owens and start reading all of their posts. What is the return on a NNN investment is not an easily answerable question.

My first investment property was mixed use so early on I saw the differences between commercial and residential.  I went on to acquire both but have sold most of the residential and am reluctant to pick up anymore.  Joel Owens had the best line on this page "I do not enjoy residential tenants on any level".  Once a commercial property is stabilized, it is pretty much out of sight, out of mind.  You are also dealing with business owners vs renters.

In terms of commercial, I have mostly been a value add investor. I find the buildings that have been neglected, bank owned or vacant. My loan terms are not the greatest because most banks won't compete for these types of properties. Years ago there was one local bank that took a chance on me and I have been loyal to them ever since. They will finance whatever I bring them because of their confidence in my ability to turn the property around. My last loan for a vacant water damaged office building was a 20 year am, 10 year term, 30% down @ 5%. Not the greatest and I can do better, but I believe building relationships is an asset. IRR for my value add deals have been between 27-196%. Those deals are much harder to come by today.

With all of the benefits of commercial noted above, the obvious downside is it can take longer to fill space. The market cycles are also different in that residential recovered way before commercial. So instead of joining the SFR rat race, I focused on commercial. Do your research and spend the hours reading the commercial forums. There is a ton of knowledge out there.

@Charles Kao and @Dave Foster

Here is a facebook site with a lot of our reno pics.  I need to post a lot more after pics.

https://www.facebook.com/lovelandchouse

I've never seen an office condo that looks appealing as an investment.  Your idea is interesting in subletting the space.  Beware of assessments.  Another option would be to buy a small office building and turn them into office condo's.  

Listen to @Ray S. and @Wayne Brooks. Call him proactively and tell him to piss off. Tell him you will call the licensing authority, write scathing reviews, warn people at REIA meetings, write on every GC/developer's FB page warning them about this jackass etc. I ABSOLUTELY HATE BULLY'S. If none of this works, hit me up and I will give you a plan B. I kicked a framer off of a job (my private residence) and he told me he was going to report my illegal garage water line (wasn't in the plans but up to code) to the city. I told him I was going to do the above and report the $10k in cash I paid him to the IRS so he can endure an audit. He left quickly and quietly. Let this clown know you are not going to deal with his sh!t.

@Andrey Y. - I guess my point is that with residential, the landlord/PM gets the call.  With commercial, I don't even know when there is a problem because most of these things fall under the lessee's responsibilities.  Its more passive.  Residential tenants will never upgrade lighting/paint etc.  

I have an office building that I lease out for $8-10/sq ft gross.  Each space is as is.  When it turns over, the new tenants usually paint and do some upgrades that stay with the building.  

@Account Closed - to quote my commercial broker's, "A residential realtor starves for the first year, a commercial Realtor starves for 3 years."

Imagine if your tenants were to sign 3 to 5 year leases with renewals.  Then imagine if upon moving in, the tenants put on a fresh coat of paint and upgraded the lighting and flooring.  Finally imagine if they called and paid for the plumber every time they had an issue, and serviced the HVAC equipment every year.  Just some of the benefits of being a commercial landlord.  Don't get me wrong, there are a different set of con's vs residential but most commercial investors either started out or dabbled in residential and after seeing both sides, they chose commercial.

The low hanging fruit is new uniform signage, parking lot sealing/striping and upgrading exterior lighting.  

I bought a church in 2008 and turned it into our primary residence.  The costs were out of control.  Unless you are a developer, I would advise against it.