How to Find Commercials Deals Besides Relying on Brokers

[Bryson Rajendran]

Hi All,

I own a few single family houses but am interested in purchasing a commercial property without beds eg retail, warehouse, flexspace. What are some ways to find leads besdies relying on brokers? I am looking for a value add type of property where I can get a good return. Any advice is welcome!

[Jason Taken]

Quote from @Bryson Rajendran:

Hi All,

I own a few single family houses but am interested in purchasing a commercial property without beds eg retail, warehouse, flexspace. What are some ways to find leads besdies relying on brokers? I am looking for a value add type of property where I can get a good return. Any advice is welcome!

 Public land records have a plethora of data nowadays. Property Radar is our favorite software by far (no affiliation other than I love it). You can find owner data for virtually any property type then just contact the owner and strike up a deal.

[Henry Clark]

A.  Our best deals have come thru brokers.  Once you decide in a buy box and show them a financing letter from your bank.   You’re not just a tire kicker.  They will take care of you.

B.  Look on Loopnet or Crexi.  We make more money on nasty value add properties.  Look for properties that have been listed for at least 6 months or a year.  

C.  GIS property tax map or records.  In your area look for properties where taxes are past due or consistently paid late.

D.  GIS map look for your type of properties.  Look for properties that have changed hands in the last 2 years preferably with a stepped up basis.  

[Henry Clark]

If you find a property on your own still other your real estate agent. Get them the buyer agent commission. They will take care of you in the future. Don’t approach the sales agent or person. Have your agent do that. 

[Gregory Wilson]

Just keep in mind zoning and code requirements. zoning is usually not a problem, but when a commercial is converted to residential current codes must be met which usually means two stair towers, fire separations, and sprinklers.

PS: Loopnet is what I used to find my warehouse. Never would have seen the sign without it.

[Nick Maugeri]

Quote from @Bryson Rajendran:

Hi All,

I own a few single family houses but am interested in purchasing a commercial property without beds eg retail, warehouse, flexspace. What are some ways to find leads besdies relying on brokers? I am looking for a value add type of property where I can get a good return. Any advice is welcome!

A broker is the best option.  

[Henry Clark]

Loopnet Commercial Cincinnati.  768 hill st.  10.6 acres Industrial $650,000.  I would literally buy it today.  It is a NASTY piece of property and I love it.  Working on a similar property, not as NASTY, thus have already run the numbers.  You should have $1mm equity at 1 year, $2mm at 2 years, $4mm at 3 years, up to $5mm equity on this location.  Have to use your imagination and turn an Ugly Duckling into a Swan.

You can look or tell a top broker your buy box.  I would actually use them to buy this property. That way they get the buyer commission with little work and they love you going forward.  Have them call and not you, otherwise the Sales Agent will get pissed later if you contact first.

[Gregory Wilson]

Every investor should learn to use Cagis. I am glad to help. just ask. When one sees an address on "Hill" street or similar clues, a topo map is the next step.

[Don Konipol]

Quote from @Bryson Rajendran:

Hi All,

I own a few single family houses but am interested in purchasing a commercial property without beds eg retail, warehouse, flexspace. What are some ways to find leads besdies relying on brokers? I am looking for a value add type of property where I can get a good return. Any advice is welcome!

I would take a different tack than most.  If you want a “turnaround” type situation network with commercial lenders and find out about their trouble loans.  Buy the loans at a discount, and strike a deal with the owner dealing from a position of strength. 

[Scott Mac]

Another method would be to talk to your tax person And attorneys, and let them know what you're looking for.

They deal with other clients than you, and would benefit from keeping the business consulting income if you buy it versus going to someone else with a different professional advisor setup.

 Good Luck!

[Gregory Wilson]

Lenders are not permitted to disclose loan terms conditions or even borrowers names until the loan is in foreclosure. Even then most refuse and refer you to heir lawyers. Appraisers and inspectors are not bound. 

[Sam McCormack]

Quote from @Bryson Rajendran:

Hi All,

I own a few single family houses but am interested in purchasing a commercial property without beds eg retail, warehouse, flexspace. What are some ways to find leads besdies relying on brokers? I am looking for a value add type of property where I can get a good return. Any advice is welcome!

 Shooting you a message now about a connection I have!

[Bryson Rajendran]

Quote from @Henry Clark:

A.  Our best deals have come thru brokers.  Once you decide in a buy box and show them a financing letter from your bank.   You’re not just a tire kicker.  They will take care of you.

B.  Look on Loopnet or Crexi.  We make more money on nasty value add properties.  Look for properties that have been listed for at least 6 months or a year.  

C.  GIS property tax map or records.  In your area look for properties where taxes are past due or consistently paid late.

D.  GIS map look for your type of properties.  Look for properties that have changed hands in the last 2 years preferably with a stepped up basis.  

Hey Henry think that using GIS maps to identify people who pay taxes late is great idea. Can you recommend a specific service? 

[Henry Clark]

Quote from @Bryson Rajendran:

Quote from @Henry Clark:

A.  Our best deals have come thru brokers.  Once you decide in a buy box and show them a financing letter from your bank.   You’re not just a tire kicker.  They will take care of you.

B.  Look on Loopnet or Crexi.  We make more money on nasty value add properties.  Look for properties that have been listed for at least 6 months or a year.  

C.  GIS property tax map or records.  In your area look for properties where taxes are past due or consistently paid late.

D.  GIS map look for your type of properties.  Look for properties that have changed hands in the last 2 years preferably with a stepped up basis.  

Hey Henry think that using GIS maps to identify people who pay taxes late is great idea. Can you recommend a specific service? 

 Use the look function.  Can’t remember the name but there are some people who offered a service to pull info from his based on your search pattern. 

[Don Konipol]

Quote from @Gregory Wilson:

Lenders are not permitted to disclose loan terms conditions or even borrowers names until the loan is in foreclosure. Even then most refuse and refer you to heir lawyers. Appraisers and inspectors are not bound. 

This is just plain incorrect.  First, mortgages and or deeds of trust are filed with the county and are a matter of public record.  Second, if the above were true no loans would ever get sold in the secondary market.
Some institutions MAY have a policy of not discussing their mortgage holdings unless under specific conditions.  And sensitive financial/personal information can not be disclosed, like ss#, etc.  But property and borrower, and anything else public record can be disclosed. 

[Gregory Wilson]

Quote from @Don Konipol:

Quote from @Gregory Wilson:

Lenders are not permitted to disclose loan terms conditions or even borrowers names until the loan is in foreclosure. Even then most refuse and refer you to heir lawyers. Appraisers and inspectors are not bound. 

This is just plain incorrect.  First, mortgages and or deeds of trust are filed with the county and are a matter of public record.  Second, if the above were true no loans would ever get sold in the secondary market.
Some institutions MAY have a policy of not discussing their mortgage holdings unless under specific conditions.  And sensitive financial/personal information can not be disclosed, like ss#, etc.  But property and borrower, and anything else public record can be disclosed. 

 Fair Debt Collection Practices Act (FDCPA): This law applies when a debt collector contacts a borrower on behalf of the bank. It restricts the collector from disclosing the borrower's debt details to anyone except the borrower, their spouse, or their attorney.

Gramm-Leach-Bliley Act (GLBA): This federal law mandates financial institutions to protect customer privacy.

Fair Credit Reporting Act (FCRA): This law regulates how credit reporting agencies handle borrower information. Banks can share information relevant to a borrower's creditworthiness with credit bureaus but cannot disclose specific loan details to third parties without the borrower's consent.

[Gregory Wilson]

Quote from @Don Konipol:

Quote from @Gregory Wilson:

Lenders are not permitted to disclose loan terms conditions or even borrowers names until the loan is in foreclosure. Even then most refuse and refer you to heir lawyers. Appraisers and inspectors are not bound. 

This is just plain incorrect. . . . Second, if the above were true no loans would ever get sold in the secondary market. . . . 

 When a loan is sold to a new servicer, the original lender can share borrower information to facilitate a smooth transition. This information sharing is allowed under the Gramm-Leach-Bliley Act (GLBA) with the following considerations:

Necessity: The information shared should be limited to what's necessary for the new servicer to handle the loan effectively.
Borrower contact information (name, address, phone number, email)
Loan details (account number, loan amount, outstanding balance, interest rate, payment history)
Copies of loan documents

Borrower Notice: The original lender should notify the borrower about the transfer and the information being shared with the new servicer. This notification should be clear, concise, and explain the borrower's rights regarding their information.

New Servicer's Privacy Practices: The new servicer should also provide the borrower with their own privacy notice outlining how they collect, use, and share borrower information.

[Don Konipol]

Quote from @Gregory Wilson:

Quote from @Don Konipol:

Quote from @Gregory Wilson:

Lenders are not permitted to disclose loan terms conditions or even borrowers names until the loan is in foreclosure. Even then most refuse and refer you to heir lawyers. Appraisers and inspectors are not bound. 

This is just plain incorrect.  First, mortgages and or deeds of trust are filed with the county and are a matter of public record.  Second, if the above were true no loans would ever get sold in the secondary market.
Some institutions MAY have a policy of not discussing their mortgage holdings unless under specific conditions.  And sensitive financial/personal information can not be disclosed, like ss#, etc.  But property and borrower, and anything else public record can be disclosed. 

 Fair Debt Collection Practices Act (FDCPA): This law applies when a debt collector contacts a borrower on behalf of the bank. It restricts the collector from disclosing the borrower's debt details to anyone except the borrower, their spouse, or their attorney.

Gramm-Leach-Bliley Act (GLBA): This federal law mandates financial institutions to protect customer privacy.

Fair Credit Reporting Act (FCRA): This law regulates how credit reporting agencies handle borrower information. Banks can share information relevant to a borrower's creditworthiness with credit bureaus but cannot disclose specific loan details to third parties without the borrower's consent.

The OP is discussing  purchasing a COMMERCIAL property. The regulations you’re quoting from apply only to CONSUMER PURPOSE LOANS, not commercial loans. 

[Don Konipol]

Quote from @Gregory Wilson:

Quote from @Don Konipol:

Quote from @Gregory Wilson:

Lenders are not permitted to disclose loan terms conditions or even borrowers names until the loan is in foreclosure. Even then most refuse and refer you to heir lawyers. Appraisers and inspectors are not bound. 

This is just plain incorrect. . . . Second, if the above were true no loans would ever get sold in the secondary market. . . . 

 When a loan is sold to a new servicer, the original lender can share borrower information to facilitate a smooth transition. This information sharing is allowed under the Gramm-Leach-Bliley Act (GLBA) with the following considerations:

Necessity: The information shared should be limited to what's necessary for the new servicer to handle the loan effectively.
Borrower contact information (name, address, phone number, email)
Loan details (account number, loan amount, outstanding balance, interest rate, payment history)
Copies of loan documents

Borrower Notice: The original lender should notify the borrower about the transfer and the information being shared with the new servicer. This notification should be clear, concise, and explain the borrower's rights regarding their information.

New Servicer's Privacy Practices: The new servicer should also provide the borrower with their own privacy notice outlining how they collect, use, and share borrower information.

The OP is discussing purchasing a COMMERCIAL property. The regulations you’re quoting from apply only to CONSUMER PURPOSE LOANS, not commercial loans.

[Gregory Wilson]

Quote from @Don Konipol:

Quote from @Gregory Wilson:

Quote from @Don Konipol:

Quote from @Gregory Wilson:

Lenders are not permitted to disclose loan terms conditions or even borrowers names until the loan is in foreclosure. Even then most refuse and refer you to heir lawyers. Appraisers and inspectors are not bound. 

This is just plain incorrect. . . . Second, if the above were true no loans would ever get sold in the secondary market. . . . 

 When a loan is sold to a new servicer, the original lender can share borrower information to facilitate a smooth transition. This information sharing is allowed under the Gramm-Leach-Bliley Act (GLBA) with the following considerations:

Necessity: The information shared should be limited to what's necessary for the new servicer to handle the loan effectively.
Borrower contact information (name, address, phone number, email)
Loan details (account number, loan amount, outstanding balance, interest rate, payment history)
Copies of loan documents

Borrower Notice: The original lender should notify the borrower about the transfer and the information being shared with the new servicer. This notification should be clear, concise, and explain the borrower's rights regarding their information.

New Servicer's Privacy Practices: The new servicer should also provide the borrower with their own privacy notice outlining how they collect, use, and share borrower information.

The OP is discussing purchasing a COMMERCIAL property. The regulations you’re quoting from apply only to CONSUMER PURPOSE LOANS, not commercial loans.

 The Graham Leach Act defines its scope to extend to protection to individuals as opposed to "financial institutions."  Maybe they disclose this stuff in Texas but the OP is looking here in Ohio.

[Don Konipol]

Gregory, any lender can provide a copy of the note and mortgage instrument to any party.  It information beyond that that may be restricted.  Further, being a Federal law, it applies across the nation.  We lend nationwide, and purchase existing loans nationwide.  Never had any problem receiving loan package from lenders who want to sell loans.  

[Remington Lyman]

Quote from @Bryson Rajendran:

Hi All,

I own a few single family houses but am interested in purchasing a commercial property without beds eg retail, warehouse, flexspace. What are some ways to find leads besdies relying on brokers? I am looking for a value add type of property where I can get a good return. Any advice is welcome!

 You could start cold calling the property owners

[Sartaj G.]

@Bryson Rajendran I am also in a similar boat. Have a few single family homes but want to diversify into NNN commercial properties. Looks like many people are mentioning Crexi and Loopnet but my impression was that good deals get picked up before reaching those forums and the best way to get a good deal is via an agent active in your target market. Is my understanding wrong?

[Ankur Mathur]

In the same boat here. Looking to start investing; but trying to find a good deal source to find the right property.

[Gregory Wilson]

Commercial agents have additional incentives to do "pocket listings" in order to increase the likelihood of avoiding a co-op commission. And, if you hook up with a buyers agent he will know nothing more than you can find on Loopnet beyond his own pocket listings. There is no incentive to share commercial listings with brokers in another agency if they are not listed on Loopnet. For properties listed in MLS, the buyers agent can do a lot of legwork and use MLS's brokers only tools and the listing agent will already expect a co-op commission to be paid.

For the bottom of the commercial market, properties not deemed worthy of Loopnet, a lot of driving around, using Cagis or similar GIS databases to get owners' name and addresses, and putting notes and business cards in doors is an alternative to Loopnet (I don't know about Crexi). Even if there is no sign and tenants are present, a poorly maintained exterior is a good sign that a building might be buyable. Years ago I came across a multifamily where the owner was not able to ready the property for market and thought it could not be sold until repairs which she could not do had been made. I bought it as is.