All Forum Posts by: Steve Morris

Can someone help me understand if it is the same qualification? Thank you.

Depends on how passive the investment. If you re-fi everything and are depending on the STNL for your sole income, it'd be an issue with a syndicator on TICs (I know it's different). Almost everyone I've seen will ask if you're a "qualified" investor (something like $1M net worth NOT counting your primary residence.) However, the major reason is that one bad TIC investor can really muck up stuff.

On STNL, dependent on the lessee (like a corporate place), they usually need some sort of warranty/surety that the lessor (you) is solvent enough to address non-NNN issues (like major CapEx). So that's a lot looser qualification, but it's been asked.

On STNL, remember you are mostly buying a lease, so READ AND UNDERSTAND THE LEASE terms for any "outs" a tenant may have.  Of course, the value of the building is important since if it's purpose-built (i.e. burger place with drive-thru) if they leave, may not be the easiest place to re-purpose or lease.

Does it makes sense for investors to obtain a RE license?

One big advantage is IF you get a place to hang your license and they have access is access to the MLS service. They usually limit those to licensed agents and there is a fee paid to keep it up.

You can use it for automated search/notification since a good deal doesn't last long.

I'd call AMZN and UPS and see what sort of secured delivery space they BOTH can deliver to.

In Portland, they allow this also IF the first floor is concrete or steel.  Then there is a new push for CLT also.

As long as you have a certified architect/struct eng and can get permits from the correct govt permitting agency for structure and fire safety, I haven't heard a problem with insurers.

Well, slight disagreement.  Depends on how you state funds, if it's cash at close and you have no financing contingency or "property must meet or beat appraisal", I'm not seeing where it's crucial.

If I'm representing a seller and I see cash at close, I'd counter with a request for proof of funds.

In the standard RMLS (in Portland forms), they make you call out the E/M, down and financed amount.

As far as source of funds for a loan, as long as it's a legitimate loan, unless you're asked for a stipulation, not seeing why disclosing hard money is an item.

In Portland, so assuming you get 3 months of pool weather and have to maintain it all year long.  I don't think most tenants see pools as an amenity worth more.

Maybe you fill it in and make it common area like a gym or community room (I've seen one guy make a study center for kids to do homework outside their apartment and tenants loved it).  Think tenants see more value.

BTW - Not a bad comment on Spokane weather - Have a bunch of guys that would love to get out of Portland and into Spokane.

If approaching a local agent of a national chain, would that just help put me in touch with brokers in the cities I'm interested in? Or could there be some sort of arrangement whereby I agree to utilize the local broker to sell our properties after the broker in the other city finds a property we want to close on?

Up to you, however, you let the local guy sell it in SFO and it ups your bonafides as a serious buyer 500%!!!!  If you just bring in cash, you may be talking to any broker, but selecting that franchise shows some loyalty.  Plus it may allow you to negotiate on the listing commission (brokers love that :)

BTW - You may want to look at FL and NC also.  You can get pretty good prices and the job growth/demand is there.

Could you elaborate on the 1031 Exchange point? Why would a broker want to drag it past the 45 day limit?

If you sell an investment property to defer CapGains and depreciation recapture you have 45 days after the close of your relinquished property to nominate 3 like-kind replacement properties and then another 135 days to close on them (please talk with a 1031 qualified intermediary BEFORE you do anything, they're very helpful and no fee).

If they can keep you in deal past 45 days, then it kinda forces your hand as valid replacement property.  So instead of (being ridiculous here) tying up a bazillion properties with notes (yes, it happens), you can only close on 1 of the 3.  The broker can then play a lot more hardball with you on retrades since he knows odds are at least 1 in 3 you need to close this one to defer taxes.

Unfortunately, as I've told sellers, you need to consider taxes when selling, but it can't drive a deal.  I've seen guys get stuck in properties at high price and then sell it a year later.

Portland, OR just enacted it.  A suburb, Gresham, has had a business license "fee" for each unit which is a tax.

They use the funds for low-income and inspections, which basically means to pay the other bills (like employee pensions) they don't want to tell you about :)

I'm cold-blooded.  Make a decision based on Cash-Cash, much simpler.

If you can earn 15% on your cash investment in OH and 10% with a rehab outside OH, seems pretty easy.