Any advice for his investment situation?

[Drue Fourmont]

Hi everyone,

I’m seeking advice on a property for a family friend who’s considering selling it to reinvest in opportunities that generate better cash flow. Here are the details of the property:

Property Overview:

• Location: Texas
• 2 lots, 2 warehouse buildings

Financials:

• Mortgage: $4,897/month (balance: $530,000)
• Insurance: $830/month
• Property Tax: $1,800/month

Building 1:

• 1 tenant
• Rent: $7,570/month
• 12,000 square feet

Building 2:

• 3 tenants
  • Tenant 1: $2,850/month (5,000 square feet)
  • Tenant 2: $1,793/month (2,500 square feet)
  • Tenant 3: $895/month (1,250 square feet)

The property was appraised for $2,200,000 three years ago.

Given the current rental income and expenses, the cash flow is decent, but my family friend is looking to explore options that could potentially yield better returns.

Would it make sense to:

1. Sell the property outright and invest in higher cash-flow opportunities?
2. Refinance to pull out equity and reinvest while keeping the property?
3. Explore ways to optimize the current cash flow, such as adjusting rents or reconfiguring the property?