Child care center with 1.3 acres of developable land.

[Victoria Yu]

Investment Info:

Other commercial investment investment in Charlotte.

Purchase price: $485,000
Cash invested: $100,000

The property is 1.36 acres in the North Davidson (NoDa) neighborhood and is zoned for 28 townhomes. The current tenant is a childcare provider operating out of 4,000 square feet on a 5-year lease.

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

I was very interested in entering the childcare industry at the time so the opportunity to purchase an already existing business including the land that was zoned for 28 townhomes was too good a deal to pass up.

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

I researched local childcare centers and sent letters to the owner(s)/director(s) for the centers I was interested in purchasing. I included my personal contact information and asked the owner(s)/director(s) to contact me if he or she was interested in speaking with me directly on the business purchase opportunity.

How did you finance this deal?

SBA 504 converted to commercial

How did you add value to the deal?

Completed $30 K worth of renovations. Deal was acquired off market for $485 M and the land appraised for $860 M back in May of 2018. Commercial real estate broker believes that it is worth closer to $1 MM.

What was the outcome?

Property has been leased to a third party day care operator.

Lessons learned? Challenges?

Running a business without being present with partners is very challenging, especially in a highly regulated environment. HR is a head ache with $12 an hour employees in a strong economic environment.

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

Scott Fuller and Jay Snover with Legacy Commercial Real Estate were extremely helpful in getting the property leased.