Medical Dental Commercial Office

[Allison Dingman]

Investment Info:

Office Space commercial investment investment.

Purchase price: $425,000
Cash invested: $35,000

Medical Dental Commercial Office; financed with owner carry.

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

We had to move our business, and started looking. We came across this via our real estate agent and the owner wished to finance as part of his retirement plan.

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

We utilized a real estate agent, who walked us through the process. We worked the numbers based on rent in the area for the bigger office. We only knew to do this because our bookkeeper for our other business knew to evaluate it and tell us what to expect.

How did you finance this deal?

The owner preferred to finance, as it is part of his retirement plan. He actually had the financing as part of the purchase agreement.

How did you add value to the deal?

This building was built in 1975, and we had to update the entire electrical platform, plus do a reno for paint, flooring, cabinets for an additional 100,000. Honestly, we did a flip and hold but did not have any idea what we were doing at the time. We just did the next thing and the next thing till complete.

What was the outcome?

We have been successfully renting it to our other business. As in the moved improved our business. The rental has always had positive cash flow, but the first 3 years was tight as we choose to aggressively pay off the reno.

Lessons learned? Challenges?

We had a couple of reno surprises because this is a medical/dental office. Such as the entire electrical platform had to be updated due to increased use of technology. Using a quality contractor saved us so much in time, because we were in a situation where time is money, and from day 1 he had a calendar with the next sub contractor tentatively scheduled, and was very organized. This kept us moving forward. This contractor was a little more expensive, but was worth every penny.

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

David Stephens, Real Estate Executives