All Forum Posts by: Katie Neason

if it were me, I would want to prelease the warehouse before I took the money out of the rental. If it takes 6-12 months to lease can you cover the debt payments? 

I would max out what you take out if you can put it to work for you. You can always give it right back by paying down the principal if you don’t use it. 

Investment Info:

Other commercial investment investment.

Purchase price: $250,000
Cash invested: $550,000

We purchased a couple of parcels of land, replatted and re-zoned them to construct a small mixed use building with 20 residential lofts and 3 retail commercial spaces. We also served as our own GC on this one.

https://youtu.be/jyYD95e8B08

How did you finance this deal?

75% LTC commercial bank loan. Interest only for 24 months then automatically rolls to an amortizing loan 5/20.

How did you add value to the deal?

Ground up development.

In BCS we are at $95-98

The one predictable thing about Real Estate is that it is a cycle.  The not so predictable part is timing and somethings it is not so easy knowing what part of the cycle you are in. We have been flipping since the last bust in 2008. In our market, it is true that the margins are tighter and the deals are harder to come by so it means we are not able to do as many flips. We look at multiple outs for all of our deals. For flipping we want to make sure that it will at least breakeven after expenses as a rental. That takes out the high end flips and the big fat juicy margins I hear about, but it provides us with a comfort level. Life is all about taking risk. Doing you next real estate project is a risk. Not doing the next real estate project is a risk. You have to decide based on possible out comes which risk you prefer.  

I have reno’d houses like this when the house was added onto the roof pitch was changed. Rather than tearing out the roof a roof was built over it.  

Minimum is $30,000 target is $50,000 and the house has to at least breakeven in the event we cannot sell it and have to rent it. 

Congrats

Slow to respond but super excited your you! If I were in your shoes starting all over again, I would find a job with a commercial outfit with people doing things similar to what you want to do or find a successful investor and see if you can help manage and grow his portfolio.  

Not of the top of my head, but will keep in mind. Are you the listing agent? 

Verde? Know them well