Once again for the second time?

[Graham Mink]

Hello,

Last year I purchased a historic commercial building that had 2 tenants who just barely paid the expenses. The building is 10000 sq ft and only 3000 was being used. After a 6 months of rehab I have found 3 more tenants and now it is cash flowing nicely. I plan on owning it a long time.

There is a similar building located next door. 10000 sq ft, historic commercial building available for sale. The problems are the price is twice as high ($250k vs $125) it needs more work and there are no current tenants. Also, it is located in a small town of 5500 people. The numbers work, with the caveat being that I need to find new tenants, which I should be able to do but not easily. Should I try and go for it again or look to invest somewhere else to diversify a little bit? I am more concerned with the thought of owning 20000 sq ft of commercial space in a small town than the dollars and cents, since the numbers work out as a very good deal for me.

Does anyone have any advice?

Thank you!

Graham

[Jerry W.]

Hey @Graham Mink . I have not really heard enough facts to help you out with anything but generic advice. How much are you getting for rent in your current building? How many dollars and how much time to fix up next property? How busy are you currently? Is your current building fully rented? What is the demand for your current building? How good is the residential rental market? Are there lots of SFR or multi units you could buy at a reasonable price to fix up and rent? What is your cash return percentage on commercial prices versus residential prices? Is there a nearby town with a better market? This kind of information will tell you if doing another commercial building next store is better than switching to residential rentals or looking in a nearby area. Good luck.