Tuesday, November 29, 2016
The SEASONS of #CRE. TUESDAY Traffic Tips
Whether your experiencing the BEST year of your career or the worst, think of your deal flow in terms of seasons. This thought process will put bad years in perspective and allow you to temper the good years. This and so much more on this week's VIDEO tip.
Friday, November 18, 2016
You Own, you're Moving - Now What?
Recently, I authored a post wherein I discussed making the ends meet in a commercial real estate deal. You can read the post here if you missed it.
During my discussion, I grazed a topic which today will receive a larger nudge - if you own your building and have elected to relocate, should you lease or sell the vacant building you leave behind?
A move generally is bittersweet - a cause for celebration because an increase in business created the need for more space. Good for you! But, the additional sales spawned another problem - you will create a vacancy. Now what?
In short, the direction you choose in dealing with the excess space and filling the vacancy depends upon several factors. Indulge me while I dissect a few of them.
The structure of your new deal. Are you buying the new building, leasing the new building or leasing the new building with an option to buy the new building at a later date? Chances are, if you desire to own the new spot and don't have a pile of cash lying around, you will need to sell the building you're vacating. Conversely, if your next space will be leased, you may be able to hold on to the old address.
Your desire to be a landlord. Owning and managing a leased building occupied by a company - not your own - comes with a set of headaches - and not necessarily a bottle of aspirin. Some of the painful biggies - who will vet the credit of the new occupant, what if the new guy fails to pay, can you float a lack of rent while you scour the market for a suitable occupant?
Can you afford to lease the existing building? Here is what I mean and how I counsel companies facing this dilemma. The market is the market. Prospective tenants will only pay you a rent figure for your building based upon what has leased recently and what other buildings are demanding in rent. So now you must roll up your sleeves, compute your costs to own the building (mortgage payments, property taxes, insurance, maintenance), add a reasonable return for the equity you have in the building and see where that squares with the market rent. You may believe yours is worth more. Maybe, but are you willing to wait? Remember, waiting is expensive. Lost rent for all the months you wait can never be re-cooped.
Do you require the vacant building's equity to fund the new location? This one is easy. I recently represented a group based in Whittier. So far past the building's capacity was their operation, we practically had to meet in the parking lot. I advised the company to move out, lease a new location with an option to buy, sell the original building and once sold, trade the equity into the new building. Had this company not wanted to own the new location - thus the equity wasn't needed - the advice might have varied and a lease of the relinquished building considered.
During my discussion, I grazed a topic which today will receive a larger nudge - if you own your building and have elected to relocate, should you lease or sell the vacant building you leave behind?
A move generally is bittersweet - a cause for celebration because an increase in business created the need for more space. Good for you! But, the additional sales spawned another problem - you will create a vacancy. Now what?
In short, the direction you choose in dealing with the excess space and filling the vacancy depends upon several factors. Indulge me while I dissect a few of them.
The structure of your new deal. Are you buying the new building, leasing the new building or leasing the new building with an option to buy the new building at a later date? Chances are, if you desire to own the new spot and don't have a pile of cash lying around, you will need to sell the building you're vacating. Conversely, if your next space will be leased, you may be able to hold on to the old address.
Your desire to be a landlord. Owning and managing a leased building occupied by a company - not your own - comes with a set of headaches - and not necessarily a bottle of aspirin. Some of the painful biggies - who will vet the credit of the new occupant, what if the new guy fails to pay, can you float a lack of rent while you scour the market for a suitable occupant?
Can you afford to lease the existing building? Here is what I mean and how I counsel companies facing this dilemma. The market is the market. Prospective tenants will only pay you a rent figure for your building based upon what has leased recently and what other buildings are demanding in rent. So now you must roll up your sleeves, compute your costs to own the building (mortgage payments, property taxes, insurance, maintenance), add a reasonable return for the equity you have in the building and see where that squares with the market rent. You may believe yours is worth more. Maybe, but are you willing to wait? Remember, waiting is expensive. Lost rent for all the months you wait can never be re-cooped.
Do you require the vacant building's equity to fund the new location? This one is easy. I recently represented a group based in Whittier. So far past the building's capacity was their operation, we practically had to meet in the parking lot. I advised the company to move out, lease a new location with an option to buy, sell the original building and once sold, trade the equity into the new building. Had this company not wanted to own the new location - thus the equity wasn't needed - the advice might have varied and a lease of the relinquished building considered.
Tuesday, November 15, 2016
MOST Overlooked in a #CRE Deal. TUESDAY Traffic Tips
If you're like I am, you frequently overlook this VERY important aspect of a deal. You can't close a sale without it - well you can, but it's risky, you can't affect a lease or give possession to a tenant, a lender won't loan. So what is it? It's insurance! Some changes are occurring in the industry causing premiums to rise. Are you prepared? I discuss this and much more in this week's VIDEO tip.
Thursday, November 10, 2016
Make TIME your Friend. TUESDAY Traffic Tips
Make TIME your Friend. TUESDAY Traffic Tips. You've heard me opine before, we have two things to sell as commercial real estate brokers - time and information. Today, I discuss TIME and a way to make time your #CRE deal's best friend. This and more in this week's VIDEO tip.
Managing an INFLUENCER. TUESDAY Traffic Tips
We've all dealt with them throughout our careers - the INFLUENCER. Not the decision maker, but close, these people can be your staunchest advocate or the largest impediment to making a commercial real estate transaction. Today, I discuss a three step way to make sure the INFLUENCER is your deal's best friend. This and more on this week's VIDEO Tip.
Three #cre Questions. TUESDAY Traffic Tips
With respect to my social media and content marketing, I get asked THREE questions, frequently. Have you made any money with that stuff? How much time do you spend? How do I get started. Today, I discuss three EASY ways to get started in your own content marketing. This and much more on this week's VIDEO tip.
Using FaceTime - Not what you Think. TUESDAY Traffic Tips
Using FaceTime - Not what you Think. TUESDAY Traffic Tips. Yesterday, I used FaceTime two different ways. In the morning, to tour a space with an out of area client. In the afternoon to deliver a lease to a cooperating broker friend of mine. Today, I discuss ways to use "face time" to build relationships. This and more on this week's VIDEO tip.
Tuesday, November 8, 2016
Exercise you #CRE Constitutional Right. TUESDAY Traffic Tips
Exercise your #CRE Constitutional Right. TUESDAY Traffic Tips. TODAY is Election Day 2016. Regardless of your politics, which are none of my business, get out and VOTE today! Politicians can affect commercial real estate laws more so than ever - SBA financing, tax deferred exchange laws, eminent domain, capital gains and many others. I discuss this and much more on the week's VIDEO Tip.
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