All Forum Posts by: JaMarcus Joseph

That's a huge risk. Commercial does bring longer tenants and doesn't seem to require as much management with NNN leases. But judging by that building, I'm sure that guy won't leave you much of an equity position. Here's an example of what builders do. At my last apt residence, my roommate and I were the first tenants to ever sleep in the new construction. The builder/owner told me that his loan was for $330k. His company built them. They appraised for $650k after completion. After all expenses, he's left with about $800 monthly. He's holding them till someone looking for a safer investment convinces him to sale. Do you really want to be the one who pays a few hundred thousand extra because you wanted the safer bet? I don't, but that doesn't fit my strategy.

That building is likely a safe bet over the long term because of its location, but I doubt you'd get the cash flow you're hoping for. I don't know what Papa John's lease or intentions are as far as that location is concerned. My wife has lived here nearly 2 years and just learned we have a Papa John's here. I'm pretty sure their lease agreement didn't include that Dickie's being built directly in front of them across the parking lot, blocking their visibility to the road. IMO, Dickie's is overpriced with very little taste. That Anytime Fitness will either outgrow its location and move or decline once 10 Fitness and others arrive to town. The ATT store just moved to its new location on Beebe Capps. At Searcy's recent business expo, I talked to a few people on the board for business and economic development. They're in the final planning stages to bring big box stores like Target, Marshall's, etc. I dont remember the names mentioned. A big strip mall to attract more people to Searcy vesus Little Rock, Conway, or Jonesboro. Before the Beebe Walmart and Searcy Neighborhood Market, the White County Walmart was the busiest in the state due to its location. I'm not sure of those numbers now because my friend in management moved on to his next step. If you want to invest in commercial, I'd suggest finding out where all this work will be happening and trying to get money on that. 

As far as commercial vesus SFR or commercial residential, people will always need a place to stay, but businesses don't always need a permenant location.

I want to get people's advice on what to put for an advertisement. It has 6 lines up to 50 characters each. I don't really care what type of property, only that they are motivated. I want to be friendly but not overwhelming. It could be visible to others. So i dont want the message to embarrass. The contact info will likely take up 3 lines. Can anyone provide any suggestions? Should I put our slogan or mission statement rather than directly asking? Should I put the company name or my personal name? Oh, I should get a website before I mail these. I'll put that on the top line. This is what I have so far.

Topline Discounts LLC toplinediscountsllc.com

"Bringing value to your neighborhood through real estate investment"

Call/text 501-827-5813 or email @ [email protected]

After forever and a day, we closed on this property. Check the forum for details and updates.

Welcome to BP. Congrats on the find. I'm in the middle of closing on a 5 unit apartment building. First and foremost, you need to realize it's commercial real estate and it changes the rules you have to follow. Public safety and the ability to be sued is the number one thing my property inspector keeps stressing to me as a commercial investor. You have too make sure everything is up to code, and see if anything is being grandfathered in that may come back to bite you with new tenants. Like what is the city's policy for handicap accessible living? What happens if a wheelchair bound tenant complained to the city that you weren't accessible? Hazard insurance, fire safety, carbon monoxide detectors, etc. I suggest you google the Housing Quality Standard inspection form. It's similar to the HUD housing voucher inspection form but it allows you space to comment instead of checks. That'll give you a pre-inspection before the actual inspection. And you want that because he sees things you don't, gets raw tenant complaints, and he comps (limited) the area for you. Don't hold off on the property inspection and make him your friend. Talk to several.

I'd talk to a broker and several banks if you're going the traditional route. Try to put them against each other to get the best rates. One local bank here has a standard 6.5% for all commercial amortized over 25 years with a 3 year balloon. IMO, that's chasing customers away. The FHA has some programs for commercial residential properties. That can be pretty sweet and can cover huge debts. The sky is the limit with FHA secured real estate loans.

My biggest piece of advice is to have a business plan. While investing should be seen as a business from the beginning, 5+ units is a business from the beginning! Whether you plan to manage them yourself or not, you're in the business of landlording as long as you intent to hold them. You should have a living, adaptable plan for each commercial property you acquire. The SBA has wonderful information available. You should look up score.org and sign up for a free business mentor. My property inspector is an advocate and taught me a lot. The SBA will offer guidance, access to money, and access to people. 

Sorry I went on for so long. Those are the things I'm learning now.

How did this property work out for you? I haven't had the bravery to make offers on them yet.

Welcome to BP!

Do you have any specific criteria for the property you're looking for? Do you have any specific criteria for the city you invest in?

Jason I think you did great by passing this up. I came across a very similar property here in Arkansas. I don't know the history but the out of state seller bought them for $16,500. He has them listed in the sky, but I talked him down to $80k. I'm pretty confident he'd take 45k if it closed fast enough because that was his minimum down for owner financing at $125k. I emailed another seller with 32 units spreadover a block in 5 buildings. 1 has fire damage to roof. All vacant. We're at 79k and Im awaiting another counter at 70k. Basically, I said all that to say that you were barely getting above retail in my opinion.
Thanks to this thread, I think I will try to contract at least one. Both MAY be able to acquired and lease ready for half retail. Any suggestions on the contingencies I should use? I always heard go with a broker for these, does that apply to vacant buildings? I have more questions but the wife is rushing me to go into lunch.

Jason, I like your ambition with going for the forbidden vacant apartment complex. I keep reading so many people saying to stay away from anything less than 50% occupied, BUT "ugly properties make beautiful wallets." - (YT -HouseflippingNinja) I'm looking at a similar building that has 32 units built in 1966. So, I'm guessing new plumbing to the main and electrical throughout. The asking price is a steal and the rehab seems to be similar to your budget. So, all that being said what did you decide on this property? If you went through with the deal, how is it going?

 Thanks Colleen. Welcome to BP. I see you've already been awarded the ADDICT label. The addiction keeps the deals coming. Losing focus causes the deals to cease. Don't lose focus of the bigger dream with the daily frustrations.

Hello again BP world

So, previously I reported that I found a private lender and a partner for this property. The lender is still in, but my partner decided to back out due to the purchase price and subsequent mortgage rate. The lender is in for a 1st lien mortgage for the purchase price at 10% with no payments and a balloon due in 12 months. I've had a few contractors bid on the work. It has dated wood paneling, vinyl flooring, and cabinets need an uplift. If the sheetrock is added, it'll be about $6-7k per unit to add up to $100 monthly income. I'll handle all the leg work. However, my research is making me question whether or not it needs to be sheetrocked aside from insurance purposes. Thanks for looking. 

Are there specific rules for the challenge besides meeting people you don't know? What are your milestone rewards to stay motivated? I'm very interested in some sort of challenge. I'm stuck in the monotony of working my job and not putting my focus where it belongs. I tried a 5 offers a day challenge but that didn't work out since I couldn't figure out a game plan. I want to try again but making at least 1 offer a day.