All Forum Posts by: William Salas

William if your dad is looking to retire than likely wants mailbox money. That would be a retail stnl NNN property with a newly minted 15 or 20 year lease. He does nothing but get a check each month.

Buying an apartment building doesn't usually make sense with 2 million as not enough doors at that price to get passive.

He could 1031 exchange into a DST or TIC but he gives up control of his hard earned money for retirement whereas if he exchanges into a property he owns 100% then he can decide what to do.

You could also look at the owner finance with some down. Your dad would still have to worry about the operator running the asset and paying the note on time. There is not one perfect answer as every strategy has it's own set of pluses and minuses .

Thanks Joel! You gave me a few new search terms to look up! Intrigued by the idea of a 1031 into a DST, I understand how he would be giving up control which honestly is something he might not mind if there is a strong guarantee of passive income there.

We have potentially considered a 1031 into a couple multi-familys which I would oversee but if passive income for my father is the goal I'm not sure that's the best option. Especially since the markets are as expensive as they are right now.

Could you elaborate a bit more on TIC?

Thanks!

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Originally posted by @John Warren:

Why not try selling it and doing a 1031 exchange into a larger property? You could potentially move the gains into a larger apartment complex or something along those lines.

Have you touched base with a local realtor to help you price the property? @Brie Schmidt works that neighborhood and can probably help.

Thank! I have thought about a 1031, it's not out of the equation. Really in the "let me see my options" phase right now. I have my fathers trust in this matter so using it as an opportunity to help him and learn for myself as this would be a new type of transaction for me.

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Thanks so much for all the info! I need to google a few terms here lol. Give me a second to take everything in and get back to ya'll!

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Hi! Any feedback/suggestions from more experienced commercial real estate investors would be appreciated!

So my father is nearing his older years and is ready to get out of the business. He has an auto shop in Logan Square which if you know Chicago you know has changed a lot the last ten years. The neighborhood is now trendy and property values have skyrocketed and will continue to do so I imagine. The auto shop, the parking lot attached to it and a single family home on the lot we think could go for between 1.4 to 2 million.

What are his options? Selling for a flat 1.7 for example would incur a pretty hefty capital gains tax. My initial idea would be to receive something along the lines of 350k cash and seller finance the rest? Especially in his retirement years having cash coming in would be really important. That would also keep him from having to pay all of those taxes at once correct?

Would love to hear any other opinions/options!

Thanks!

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I'll be there! :)

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Thanks for the insight Jack. Running a proper title search seems to be my next logical step here. I think it'll help solve these initial set of questions I have. What part of Miami are you in? Thanks!

Originally posted by @Jack V. Ospina:

Hi @William Salas If she has a mortgage on the property of $149,600 then she is technically underwater and in this scenario she will only be able to short sale the property to a potential buyer. A short sale can take anywhere from 4-12 months to close on and there is no guarantee the bank will sell at the price your asking. Also, If there are liens on the property you need to find out why? Is this from code enforcement or the building department. If it is code enforcement you can negotiate the liens somewhat. If it is from the building department you might need to bring the violations up to code and this requires pulling a permit, passing inspection, etc. I work the entire Miami market and know it well. If you need assistance analyzing the property you can message me anytime. Good luck!

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They told me to call a title company :(

Originally posted by @Yvonne H.:

You need to know whether or not their is a mortgage. What leads you to believe there is? Call the Dade County Recorder. They can verify whether or not there is/was a mortgage and if it has been cancelled.

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Thanks Andrew, yea my offer is going to be on the lower side for sure because it seems like a lot of risk but the property has just been sitting there in her name collecting fines. At this point I think she'd be open to getting something rather than nothing, I know I would. Going to meet with her today.

Originally posted by @Andrew Johnson:

@William Salas Maybe ballpark your estimate for an "entire rehab"? You could end up in a pretty defined scenario (regardless of mortgage) pretty quickly. If it's $50/sq ft for the gut/rehab then it's $36Kish in rehab + $6K back taxes + some kind of holding costs = $35K max for the property. If you want to make some decent money and have a cushion you'll have to buy it for, what, $20K? No formula here, just ballparking numbers. I'm just guessing but if you toss out $20K as a number you might get a tersely worded reply laden with curse words...

That said, I've seen people talk about $20/sq ft for a full rehab, some at $35/sq ft and some at north of $50/sq ft. You'd probably want to figure that out.

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My CRM shows it in the property details section. I'm going to have to run a proper title search and see whats up.

Originally posted by @Caleb Heimsoth:

Where did you find out it had a mortgage from?

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Hi ya'll! Would love any input/commentary here. Trying to decide if this is worth moving forward on.

So I've been talking to the owner of 3/1 property she's interested in selling.

The target property is vacant and has been for some time. I was able to go inside and it needs an entire rehab.

Here is what I know...

- Property is 3/1 and 728 sqft

- ARV on the property is about 80k (lower income neighborhood)

- There are back taxes due of almost 6k

- It needs an entire rehab pretty much

- There are 3 liens on the property for being vacant and not up to code.

and the kicker....according to my research there's a loan for $149,600 in 2006 but the house hasn't been foreclosed on?! She says she doesn't have a loan and she def. hasn't paid any mortgage any time recent.

So there's a missing mortgage it seems?! I called a title company and they were perplexed as well.

I'm trying to see if there is enough meat on the bone so to speak.

I think I could get it for a great price but I see a lot of potential risk. Any insights would be of great help! Thanks!

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All Forum Posts by: William Salas

William Salas has started 15 posts and replied 74 times.

Post: Auto Shop in Chicago selling strategies?

Post: Auto Shop in Chicago selling strategies?

Post: Auto Shop in Chicago selling strategies?

Post: Auto Shop in Chicago selling strategies?

Post: What's Brewing Miami - REI Meet and Greet

Post: Complicated property, easy going owner

Post: Complicated property, easy going owner

Post: Complicated property, easy going owner

Post: Complicated property, easy going owner

Post: Complicated property, easy going owner