All Forum Posts by: Frank Hinck

@Dixia Martinez

Different company. You might want to sell the management company some day.

@Seamus Harper

Don’t cash his check!! If it wire transferred or direct deposited then sent immediate notice that he has gone past payment terms and the funds are not being accepted and probably so this notarized Certified Mail or through a Process Server. I’d even post formal Eviction paperwork on the front door. Cash for keys may be an option but since it’s his business he would probably see this as weakness and want thousands of dollars.

@Aleah S.

Hi Aleah. I think you’re seeing the best possible side of a small portion of being a commercial landlord. If would say what you’re doing is somewhat investing, you’re taking a small risk for a small reward but there’s still an owner in place to cover the capital repairs. Kind of like if you leased a house and then used it as a AirBnb to rent to other tenants.

Commercial ownership is good because you can kind of house hack your Suite or get it nearly free. As an owner you get to reclaim all the NNN from your tenants, longer leases provide more stability for your rent roll, commercial properties don't generally decline in value, right now many businesses are suffering and defaulting but some are doing great with online sales. Cons are the barrier to entry is higher, 20-25% generally of $1M-$2M. Vacancies last much longer than residential, capital improvements for a new roof top unit, new garage doors, new roof, etc are much larger. When you have new tenants the TI allowances can be $5/SF which depending on the size tenant you may need to ReFi your building to pull off. Broker fees on new tenants are also costlier and spread out over the entire lease term. I'm sure there's other articles out there on this topic, these are just my observations. If you're really comfortable in the property you rent in now maybe work out a Right or First Refusal to Purchase the next time you renew your lease. Perhaps you can pay an additional $3,000/year into Equity (roughly your take from the sublease) now which doesn't vest for 5 years so you're gaining equity and not paying taxes on your sublease side hustle. Best of luck!!

@Calvin Kwan

Habitat for Humanity ReStore has good used appliances. Some come checked for electric, water,

@Jeremiah House

What does your Agreement say? Might be better to not partner with that person, or revise the Agreement. Sounds like you’re frustrated and will only get more so. Or farm out your tasks as well.

@Patrick Reagan

I think not providing appliances is a way to ensure bad tenants.

@Tony Moon

Yes a home inspection and GCs visit is wise. Especially if going for a HML or traditional financing this will help you validate your construction costs and ARV.

@Sam Sand

To answer your question direct: Legally only 14 states requires licensing to make a business loan, so odds are you can get started where you live. Pragmatically there are 20 main things to consider and 100 other factors.

@Leslie LaBranche

Do some analysis on buying existing vs building new, in Chicago buying is likely much cheaper. Putting section 8 tenants especially large families in new construction is just asking for damage on all new finishes, you’d have to Tenant Proof the finishes

@Amanda Williams

I have done this exact job for BRRRR investors and granted my FT job is commercial construction manager so I feel I hold myself to a high standard on these BRRRR flips, but the best way is a flat fee based on 1 2hr site visit per day, he writes a schedule ahead of time that he is held to Gantt Chart style. I would incentivize for faster finish, and would not have him work on the property.