Saving Downtown History

[Daniel Snyder]

Investment Info:

Retail commercial investment investment.

Purchase price: $250,000
Cash invested: $88,000

Commercial flex space. This vacant property was purchased under market value and needed a little love. After a few long months we secured a long term retail tenant to call this place home.

What made you interested in investing in this type of deal?

We have wanted to own a downtown property for a while and stumbled upon this deal.

How did you find this deal and how did you negotiate it?

This property was poorly listed. (Not on the local MLS) While in Nashville at a doctor appointment, I guess the algorithms were in my favor and it appeared on my phone.

I immediately sent it to my realtor and we schedule a showing later the same day. He and my mentor said I would be a fool to pass this up. If I didn't put in an offer they would fight over it. It had had very little attention since listening out of town. We offered slightly below asking and they accepted our offer.

How did you finance this deal?

12 month bridge loan with interest only payments. Renovations completed using our HELOC. Will refinance to permanent financing soon.

How did you add value to the deal?

This building needed new roofing. We also had to replace two rotten walls and some rotten floor joist and subfloor. We added windows to two rooms that previously had none and replaced 3 existing ones. We had to replace the hvac unit. Added new flooring throughout the back portion of the building along with paint.

What was the outcome?

Long term retail tenant in place. We have yet to have another appraisal completed but I estimate a new evaluation of $350,000.

Lessons learned? Challenges?

Soon after purchase, I started advertising the space for lease and we received overwhelming interest. (Perfect location, great space) I chose what I thought would be the perfect tenant. We begin to work with the future tenant and made specific updates and changes to suit this tenant. However, we had yet to secure a signed lease. When the day to sign the lease finally arrived, she called me and said she had to back out. Needless to say, I was defeated.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Judd Dial with The Property Company in Cookeville TN