All Forum Posts by: Steve Crawford

I guess no matter what the OE is, the NOI is the number we use to find the cap rate to determine the return.

on NNN centers, the OE is management only...................which doesn't mean they are a better deal.

It is also noteworthy ( on the 50% rule) that while mgt fees are fairly linear, taxes and insurance are not.

Very Interesting. I have only had one or two multi-family properties and that was quite awhile back. I don't remember the numbers.

On strip malls with gross leases, no NNN, I run about 30% of collected rents to OE.
Not including any Reserves.

Hard to compare, but I note a few differences. In most places, my RE taxes run about 5-6% and my utilities (all in) run me closer to 1%. I too pay 5% mgt, but my maintenance can run up to 10-12%.

It is an interesting comparison........for me at least.

75% RE
5% stock and commodities
15% sports cars (very sensible)
5% can't find. Think my wife might have hidden it.

I agree, just put her (sister's) name as specific exclusion on your property as "no commission" and you are good to go.

Absolutely this can be done.

But i would not expect to get face value for your note on an arms lenght transaction.

Kind of like trading in a car in. They will give you twice what you thought yours was worth, as long as you pay sticker.

I would think Marc's idea of selling the note (and it wont be for 100% of face value) and then negotiating a good purchase.

I have about 80 properties and 250 Lessees. I am not an out of state investor, but I have many properties in state, that I have never seen. Probably 20% that I have never seen.
I have had many that I purchased, operated and sold and still never saw them.

Then again, I have many sgl fam houses that i personally mowed the yards last Summer after work.

PM works great for me on the properties that I can't easily handle myself. 5% for tenants that require maintenance is a great deal. I wouldn't even consider multi fam w/o PM. But NNN commercial tenants are a breeze via phone.

My biggest problem with out of state properties is banking them. My lenders rarely consider loaning me money on an out of state property. Moreover, I am less and less confident in my ability to fully assess the property the farther away it is, e.g. the neighborhood, growth trends, comps, etc.

Annual revenues 1.1M, debt 850K.

The property doesn't have a race. So you are free to evaluate tenants based on lease, length of stay, payment history, etc. The race, religion or sex of the tenants could change overnight? You never know.

Just read the F.H.A. and then make a good sound business decision.

Language is just a component cost related to this property.......leases in spanish and english or bi-lingual property manager. No big deal........just factor it in.