Commercial Property Valuation/Rehab for Personal Use

[John Maynard]

I saw a commercial property location with a distressed building on it, that I believe is in a great location for a retail location. My wife (pastry chef) and I are thinking of opening a bakery and I thought this location would be great. With the building in disrepair, how would an investor approach this property knowing you were going to use it for another business venture of your own? It's not like I would be making anything from the rent!

[Andrea O.]

@John MaynardI bought a commercial building under the name of a separate LLC and got a little reduction in the interest rate since I planned it to be owner-occupied. I rent out half to a retail tenant and my professional service business rents half, so the RE LLC receives a check each month (market rent) from my primary business just like it would in any landlord-tenant relationship. My thought is that I don't want to subsidize my business with reduced rent just because I own the building. My business needs to be a quality tenant that produces cash flow for the RE company. Sharing the building with another tenant is a huge help. I also rent out parking in the back. Maybe get creative and think about how the RE would cash flow with or without the bakery. Good luck!