All Forum Posts by: Chris Cozzens

@Ricky Hopp I would agree, comps are the best way to do so. I believe J scott and mr turner have a book out that is estimate repair cost, i have not yet read it, but it is possible that it goes into details regarding ARV and how to estimate that as well

Welcome @Adriana L.  Also a new investor, would love to sync up to discuss entrance/exit strategies for your first deal

Hey @Joel OwensThanks for the response. I guess the part i am struggling with is valuing the equipment.  It just seems like an estimate from my perspective.  So for example lets take the walk in refrigerator.  The landlords want us to believe since it cost them 40,000, that is the value of the fridge.   The way they are phasing it to me is , if you have to buy a building with no fridge and buy a fridge it would cost you 40,000 , therefore it is worth 40,000.

First, how would you approach the conversation with him to decide the real value of the used equipment? How do we accurately determine how much the equipment is worth in is current state? 

Hello BP, I posted this in another thread, but hoping this one may be more suitable.

I am in need of some advice / guidance. I own a very large food processing company, we are currently renting out kitchen space in an ideal facility. We are reaching this facilities limits in terms of production capacity. Our landlords seem very fair and are looking to retire.

We are currently hoping to purchase the building from the landlords. They are suggesting that we purchase the building with all of the equipment as well( ovens , fridge, tables, etc ) They are giving us a number of 750,000.

My first question is, how do we accurately determine the value of the building along with the assets included? Is this a standard thing for buying a commercial kitchen?

Next, We are looking to put about 160,000 down, Would it be smart to finance the building and the assets with one conventional loan? Or does it make more sense to split it into two transactions, one for the building and possibly seller financing for the equipment?

Lastly, we are also hoping to expand to the west coast very soon as I had mentioned we are reaching capacity limits on this kitchen in the next year or so. We do shipping nationwide and moving the the west would help double our production power and take advantage of lower shipping rates to the west. My initial thought is we would take out an equity line of credit after we buy the first building and leverage that for the second building. That seems too simple for me, so am I overlooking anything legally/logistically with this situation? Also would our decision to finance the building + assets together or separately have any effect on this?

Alright, I know there is a lot in this one topic, any help would be awesome!!

Thanks Guys,

Chris

Hello BP,

I am in need of some advice / guidance.  I own a very large food processing company, we are currently renting out kitchen space in an ideal facility.  We are reaching this facilities limits in terms of production capacity.  Our landlords seem very fair and are looking to retire. 

We are currently hoping to purchase the building from the landlords.  They are suggesting that we purchase the building with all of the equipment as well( ovens , fridge, tables, etc ) They are giving us a number of 750,000.  

My first question is, how do we accurately determine the value of the building along with the assets included? Is this a standard thing for buying a commercial kitchen? 

Next, We are looking to put about 160,000 down, Would it be smart to finance the building and the assets with one conventional loan? Or does it make more sense to split it into two transactions, one for the building and possibly seller financing for the equipment? 

Lastly, we are also hoping to expand to the west coast very soon as I had mentioned we are reaching capacity limits on this kitchen in the next year or so.  We do shipping nationwide and moving the the west would help double our production power and take advantage of lower shipping rates to the west.  My initial thought is we would take out an equity line of credit after we buy the first building and leverage that for the second building.  That seems too simple for me, so am I overlooking anything legally/logistically with this situation? Also would our decision to finance the building + assets together or separately have any effect on this? 

Alright, I know there is a lot in this one topic, any help would be awesome!!

Thanks Guys,

Chris

@Joe Capobianco No worries! If someone has already scooped up the deal, it must mean it was a pretty good one.  I would think that means you are becoming comfortable with identifying some good deals.  

Keep looking for deals such as this one! You will get one soon! 

I was listening to one of the podcasts today and one of the guests had mentioned they were able to pay a one time fee for PMI. So instead of ~150/ month for PMI they paid an upfront free of 1800 i believe. I think this was an option presented to them through the lender.

I am not sure if this would help, however it may be worthwhile to ask if it is affordable and you are worried about the additional costs!

Hey Joe, I am a new investor from NJ.  I used to live fairly close to old bridge in North Brunswick.  I am fairly interested in what others have to say as well and would like to offer my two cents to start off the conversation.  

I think that it would depend on a few things.  How long would it take you to save for 20% down on that multifamily? 

My second question would be, how good of a deal is the house down the street? Is it something that is selling for way below market value and needs a bit of work?  What is the state of that home down the street? The more info the better.  

Last Question, Do you already have your eye on any multifamily deals?

I guess what it would all come down to for me is the numbers.  Which deal would put you in the best position to achieve your goal efficiently? 

I look forward to connecting. 

Nicely Done @Kris Haskins!! This might be a silly question, but how did you find a deal where you assumed the loan from the seller?  Was it someone you knew, or is this a common practice?  

Thanks @Alexander Flores That does make a lot of sense. Generally PMI costs about 1% of the purchase price, does that sound correct?

Do you know if there are any specific requirements to qualify for an FHA loan as opposed to a normal mortgage? ( besides being a first time home buyer )

When you got your FHA loan, did you buy a duplex or multifamily home and house hack it? Or did you go with the single family home?