All Forum Posts by: Mark Neiger

Andre, thanks. Any of you others on this post feel that's a good or bad idea or even possible to do?

Dennis, thanks. I'll try to get aggressive and get more and better numbers and a walk through. I get the feeling that brokers are dealing with a lot of tire kickers and they deal with this by throwing a market package at you. Maybe if I can convince her how serious I am I can get a little more cooperation. 

some of you are misunderstanding me. The rents are not below market. They are where they should be but one unit is currently vacant. That's what I'm basing my valuation on. 

Wow! Thanks for the vote of confidence Bob! I posted because BP is supposed to be a place to ask questions and receive help from those who know more and have lots of experience. Since I "obviously don't know anything", maybe you could be a little more helpful and offer me some of your vast knowledge. I work full time and am investing in my spare time. I don't work for Marcus & Millichap so my market research is not perfect but I do know the local CAP rates, vacancies, market rents, etc., thank you very much. Isn't the point of due diligence to discover the true expenses, actual rents collected, repairs needed, etc.? Can't go to due diligence if no one ever accepts my low I simply wanted to have other eyes look at the marketing package numbers and tell me if I should pursue it any further or continue to look. If you don't have anything constructive to say, please don't post.

Ben, thank you for replying. I'm a huge fan and take your opinion very seriously! So if you feel 50% is too conservative then what do you think I should push it too? 60%, 70%. I have no plans on overpaying and I obviously want to run a profitable building. If I would not like what I see in due diligence I have no problems walking away. My problem right now is the Catch 22 of not having any commercial experience and not being able to break into commercial because of my lack of experience. Brokers and lenders want a track record and I somehow have to establish one. Ugh! I'm being realistic and I know I'm not going to find a grand slam property at my stage in the process. I need something however. I won't put myself in a bad situation but there are a lot of entities out there that are driving the prices up and I can't sit on the sidelines forever. 

ok. Good to know. 

I'll talk to my broker on Monday. One unit is currently vacant so maybe I can push the issue and get them to let me see that one. 

And thanks for the answer on the timeline. 30 days seems reasonable for due diligence. 

I've seen the exterior. There are no common areas other than the lot and parking. 

Darren, obviously 23% is way too low. I'm not basing my valuation on that number. That's typical pro forma BS. I'm evaluating on 50% and based on that number I'm trying to make an offer that puts this at a very realistic 8 CAP. My original post is just to see if anyone in my market might have any insight, point out a red flag.

R J. I'm new to this commercial game so I'm not sure about what you're saying. All I know is that I was told by the broker that the owner asked that the tenants were not to be disturbed, a non disclosure must be signed and no walk through would occur until after the building was under contract and in due diligence. I'm I being fed a line of crap?

That's how I see it too Jane. The problem is that everyone else can see that as well. If I don't go in at full asking price and try to knock the price down by a measly $10-$15,000 does that put me out of a good deal?