First Commercial Deal

[Tim Walls]

I am looking at buying an old two story brick commercial building that is right on the town common in a very good city just west of Boston, and is perfect for mixed use. Price $750K, and most of the repairs would be cosmetic. It has the location, and the space to fit TWO restaurants on the retail street level, ample sidewalk space for outside dining, and plenty of deeded parking. Upstairs is a blank canvas, with over 8,000 sq ft of raw space that would be perfect as condos or apartments. Spoke to the town, and they are very much behind a mixed use approach to redevelopment in this space. They have been waiting years for someone to take on the project, and have assured me that they would be behind me if I buy it. (including the town planner etc) Quick analysis of the sq. footage shows I can get about $180K / year in NNN lease income if both sides of the first floor are leased, so I can more than cover the debt service. And I thought I could build out the second floor in year two, after I had a solid year of income.

The question is, where do I start? Do I talk to potential tenants first, or the bank? Would the bank want to see signed leases before they will consider a commercial loan?

And, If I hire a commercial broker to represent me and help me to pull it all together, do I pay him (her) or does the seller?

Thanks for any input, and I'll keep digging through the threads for more info as well.