All Forum Posts by: Greg V.

Juan Vargas Am I reading this right? Passive loss limitation is now $300k?

Does anyone know if the passive activity loss write off limit has been raised?

Does anyone know if the passive activity loss write off limit has been raised?

As far as what to do now, you have to find a geographical market you want to invest in and limit where you're looking at first. Figure out what you would pay for every single property in that area. You can pull information on properties for lease and sale from Loopnet. Look at tax records online if you can. Put together a mailing list of owners for your targeted area. Figure out which broker you want to use and approach them. I would look at the current commercial listings and see if there's someone or a couple that come up multiple times. We're also waiting although office lease rates in some markets still haven't recovered. There still may be some value.

If you're looking for a property of that size and assuming it might be your first or maybe even second or third property, the bank will probably want 30% down. I'll let other people chime in but I don't think commercial lenders look as much at credit score as the residential market. I would think anything over 700 is good maybe even down to 650 or 620 depending on the reason.

Thanks Joel Owens What are your clients seeing in terms of tenant growth? Have applications slowed?

I just wanted to get the pulse of everyone's market. In our suburb markets of the Twin Cities, we seem to have hit a slow patch. Last year was really busy but this year has been really quiet with a drop off in tenants looking for office/retail space. We still haven't seen the lease rates come back to pre-recession highs. Depending on the property, the rates are still off about 30%. The slow down is making me a little nervous about our local economy. Anybody else?

Also, our lofts are between 800 and 1200 sq ft. With 4000 sq ft, and depending on the building layout, 1 bedroom lofts or 2 bed flex may be your best bet. 2 bed flex is what we call a loft with 1 fixed bedroom and another one that has movable walls that can become another bedroom or left as a common living space.

This is just a rough estimate but in our area we use $100 per sq ft remodel cost on historic loft reno's. If the numbers are in the ballpark, then we look deeper. What I've seen in our market is that it doesn't make sense to reno these old buildings unless you can get federal or state grants or TIFs. Be careful and have plenty of contingency funds.

Thanks Mike L.