All Forum Posts by: Ty Doke

Hey Chris,  

Thank you for taking the time to share your thoughts on this!  I do agree, I believe these are two great options to consider.  Thanks again for your input Chris!

Have a blessed day!

Hello All!

I would love advice on a commercial property.  It is a mixed use, some apartments on the lower level.  On the upper level, which is storefront, on main street in a small town in Nebraska is approximately 3500 SqFt of unused vacant storefront commercial space.  I would like to rent the commercial space but would love any advice on how to advertise and what is common to offer.  My biggest question is how to structure a commercial lease.  I have been exposed to this and I do understand every deal is structured different depending on the needs of the owner and lease holder.  I am just curious if anyone has any advice they would be willing to share.  

The biggest issue is that my resources are currently tied up on renovating the existing apartments.  The commercial space is raw (previous grocery store) and will need a build out.  So, with that build out needed is there a specific way anyone would propose listing it?  Should I list it as is, with a raw space lease price and allow them to complete their own build out?  Should I offer free rent for a period of time, and have the future tenant invest their own funds towards the renovation?  Any advice on previous experience with raw commercial space would be greatly appreciated!  

Thank you for taking the time to read this and offer any wisdom!  :) 

-Ty

Thank you to everyone for your input.  I greatly appreciate you taking the time to share your opinions.  

Have a great day!

Caleb Heimsoth:  Thank you for your input.  With all due respect, I do not believe I am the first or last to not bring capital to a real estate deal.  What I am providing is my 15 years experience managing commercial and residential properties.  I will be managing the residents, and rehabs.  Absolutely I am not bringing money to the table.  What I am bringing is time, energy, and experience to stabilize the property and bring it to its fullest potential.  

@Caleb Heimsoth putting down 28k have 47k in reserves. Would that be considered undercapitalized?

Harry Neal, thank you for pointing that out!  I included the price in an edit $140,000. Thanks!

I am under contract on a property. My partner is providing the capital for down payment, and renovations. Partners capital is currently in mutual funds with a Financial Advisor Firm.  We met with his advisor about 6 months ago and presented the plan to use that capital to purchase real estate, renovate, then refinance out equity and recycle that original capital into next deal.  At that time (6 months ago) the advisor said, we at this firm cannot offer anything that will come close to the returns that real estate provides, so go for it.  

Now, my partner calls the firm to move the funds from these mutual funds into our company bank account so its ready to go to close on this deal and his original advisor's father in law (owner of the firm) hears that my partner is moving his capital out and he tells my partner (without any knowledge of the deal no numbers or anything) He tells my partner that Real Estate is a terrible idea.  He will lose his money if he invests in real estate.  He said it is never a good idea to move money out of a mutual fund, and into real estate deals.  Real estate only  make sense if you can do it without putting any cash into the deal.  He claims he has invested in real estate many times, and has been burnt.  

I am meeting with my partner and his advisors father in law (president of the firm) to present the numbers on the deal.  I am just curious BiggerPocket community, what points would you bring up to this Financial Advisor?  

Little background on the deal.  Its a commercial property with 4 basement apartments, room to add 2 more apartments (4 apartments currently rented for $2400 a month total).  Upstairs is a 4000 SqFt vacant commercial space (gutted) in a downtown of a smaller town 20 miles from major metro.  Our offer for the property is $140,000.  

Any input or suggestions are greatly appreciated!

Have a great day!

@Peter Nikic, @Charles Seaman, @Jonathan Greene Thank you for your input and suggestions!  Excellent advice!

When doing due diligence on multi family properties, if the current owner does not have a rent roll or formal T12 or P&L how can I verify the income of the property? Is it acceptable to ask for bank statements or a tax return? Also there are no signed leases to verify current tenants/occupancy. They are all MTM and on a "handshake lease". Is there any other documentation you would recommend I ask for? The owner seems like a very nice guy who has owned a property over 40 years and has just done it that way and it has worked for him, but would love any advice on how to continue due diligence when there is no formal T12, P&L or rent roll. Is it acceptable to ask for a bank statement verifying rent collecting and or a tax return?

Thank you for the help! Have a blessed day!

Hello Bigger Pockets world! What a blessing this community is to all who are motivated to learn the business! My name is Ty Doke, I live in Omaha Nebraska. I have over 14 years experience in Property Management (Residential and Commercial). I have always been interested in doing my own REI, as I have been in the been in the business for many years helping others increase their own net worth. I will likely pursue a Real Estate License this year, to gain instant access to the MLS. Doing so I believe will be worth the investment to benefit myself and other partners in the future. I want to thank Bigger Pockets and all of you who also share your wealth of knowledge to help all of us who are interested in learning more and improving ourselves personally and professionally. I look forward to learning more from the Bigger Pockets community and also to share what I have learned along the way managing assets!

(Feel free to contact me through BP I will try my best to answer your question or help find the answer)

Have a blessed day!  

Ty