Catapulted my portfolio with another commercial property

[Jasmine C.]

Investment Info:

Retail buy & hold investment.

We used the catapult strategy to build my portfolio and add this amazing commercial building into the asset column.

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

the seller was motivated to sell at a discounted price due to his need to do use his proceeds on an exchange he was doing.

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

Our realtor brought it to my attention as a pocket listing.

How did you finance this deal?

bank loan and 1031 exchange funds

How did you add value to the deal?

The property was in great condition and 100% performing. He needed us to close on in 30 days or the deal was off. We had a great relationship with a bank that was able to make that happen even though most banks were averaging 60 days to close. We also found out the tenants were not paying all the rent owed per the lease. The owner self managed and simply forgot to charge them.
We offered to make a few cheap fixes and request they pay what they were expect to pay per the lease.

What was the outcome?

We closed on time, we were able to push up rents because he was not charging everything he was allowed to in the leases increasing our property value by 100K simply by having a few short phone calls with the tenants.

Lessons learned? Challenges?

Biggest lesson learned is to make sure all your ducks are in a row. In commercial a 30 day close in very fast and it is only possible if you have all of your systems and documentation ready to go from day 1. Property management is key to reading leases since commercial leases can be very complicated with CAM's and who is responsible for what.