All Forum Posts by: Greg V.

Not sure about Ohio, but many states have rehab grants even if it's not on the histrionic register. Also look into community development block grants and if it's in a TIF district. Unfortunately, many times, rehabbing these older commercial properties is not worth the money if there are no federal, state or local kickins. If you don't have any experience in rehabing then you may want to just list it for the land value and sell it.

These terms are similar to what our local bank asks for but you can negotiate. My recommendation is to look into an interest only with a 1-2 year balloon which would get rid of the prepayment and get you a lower interest rate. It's a little riskier so understand the downsides. If you're going to flip then, like was mentioned earlier, you shouldn't care about paying down principal and look to minimize carrying costs. As a backup if your plan fails, I would run the numbers for the above loan at probably 6% interest and renting out the units.

If you go straight to the sellers agent, you might (emphasis on might) be able to negotiate a lower commission and lower price. I was able to do that once when the seller was a broker. It was our first purchase and we lucked out and got a good deal. I would highly recommend not doing that. Commercial brokers are worth the cost. However, many realtors will say they are knowledgable in commercial properties but won't even know what a cap rate is. Don't just go with a realtor because they say they know commercial or that it's listed on their website. There's a big difference in knowledge level and it's worth it.

What does the overall Chinese real estate market look like? Was the 60 minutes episode about ghost towns overblown? Is it slowing? Macro numbers from China are mixed. Depending on who you listen to here, either a gradual slow down or an impending disaster. Like usual, the answer may be somewhere in between.

Mark Creason No thanks. I know Texas is a growing market and I've been there a number of times but I just don't know the markets there well. At one time we owned properties in 5 states but couldn't properly manage and gain synergies between the properties. We're slowing selling off and focusing on one area where I can also start to influence lease rates, and property sales.

I had the same issue with a recent purchase. Difference between purchase and the reassessed value was $200k. However they dropped the assessment in half when I purchased it. I was on the fence as to dispute it because once I get the space leased which should be a year, I was afraid that if I pushed it, they would reassess it again at an even higher rate. Also, in the end I didn't have a lot of time to dispute because of the timing of the closing and dispute process. Sounds like maybe I made an ok decision. Thanks for others input.

We specialize in buying half vacant to fully vacant retail/office space. We're in the due diligence process for a $2M rehab of a historic structure that will have lofts on top and retail on bottom. I love working with commercial tenants--less emotion and less drama. The downside is less volume and higher price points with higher initial costs including longer vacancies. The upside is forced appreciation which can be huge.

I'm still trying to figure out when to readjust our approach, price or other factors. Our newest space has been listed and advertised for 3 months and we just got our first tenant into the building. I just adjusted the price and advertised in a couple new places. For me it was the fact that we had a good amount of interest (maybe 5 qualified tenants, we're in a much smaller market) but no return phone calls except the one. That tells me the advertising is probably pretty good but the price or building needs changing. Our last building had a vacancy when we bought it and it took 1 year to fill but got a 10 year lease with a national brand. Patience and cash reserves are a virtue.

We're turning to start up small business tenants. We've seen the most demand there. We've found the demand for space from larger tenants to be low. As a backup plan, can you split up the space? If you go down that route, where would small businesses get their news, info? Is there a local newsletter? I don't know LA but in our area, we're now advertising in local newspapers (online and print) along with MLS, and Loopnet.

Thanks for your ideas. I'll keep everyone updated on how it goes. Right now we're still getting a rough cost estimate to see if we should go through with the purchase. We've hired a local firm that specializes in these older rehabs. They don't do any of the construction or sub-contracting so less conflicts of interests. We're going to be extra conservative on our numbers because we don't know what we don't know yet.