Next Level investing Part 6 Commercial RE investing

February 8, 2022.

So I had to log today as there is another experience I got as a Property Manager that you can really only get if you manage a lot of properties. .. an email from one of the caretakers in a 70 unit building I manage... and my reply 

this is not part of my Commercial RE story but I thought I should copy/past the two emails from my work today. 

Hey Wendell yesterday I got a call from a tenant of a homeless guy sleeping on the southwest end of the building. I went out to ask him to leave like I always do , he didn't respond to me so I got closer to him noticing he didn't look very good he was a pale blue , i laid him flat and called 911 and started chest compressions, He was already gone at that point but 911 had me keep doing compressions till fire rescue got here . They worked on him for another 30 min then stopped, so yeah he was deceased. I gave the police the details so that should be it ,I just thought you guys should know. thanks

Hi Wayne, that is sad. I will say a prayer for him. I am glad to know that in that situation, took control and acted, whereas many others would have just stood by and waited for authorities. I would like to think that if he had not already passed that you may have saved him. Your actions were commendable.

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Commercial RE continued...

So I finally received an offer on the warehouse I have up for sale. There was some back and forth and we finally settled on a figure that I am satisfied with. I will have to do about 20-30k worth of work on the warehouse to get it into proper shape. Closing is in 9 weeks. It may be sooner, but I have lots of work to do. The tenant's lease ended on Jan 31, but they are still removing their equipment and cleaning up the warehouse. I have a move out inspection scheduled with the tenant on Thursday Feb 10 around noon. Right after that I will have my own cleaners get into the warehouse and dump what is left and clean out all the sawdust. After that there is roof repair, curb repair, window repairs etc. The current tenant did so much unauthorized work in my office space attached to the warehouse that I was shocked.  In the office space attached to the warehouse they removed 6 walls, 4 doors, a whole ceiling (use the office as a furniture workstation and left it in an un-repaired state.) They installed nice tile on the floor, re-did one of the bathrooms. They also removed a 331 sqf warehouse office completely!  What is really weird is that they put wood cutting saws and dust collection systems on top of the new tile! 

I did a pre move out inspection check on January 31 and then got quotes for much of the work the tenant has to do to return the unit to its original condition minus wear and tear. I will try to negotiate a settlement with the tenant for the work to be done as I know they will not be able to finish it all in time.

Barring this, I will just do all of the work and hand the quotes/invoices over to my lawyer with the lease and let him have a go at it. Likely I will settle for about 1/3 to 1/2 of the quoted work. If the tenant negotiates, they can keep the other 1/2 or 2/3.. if not then my lawyer will take over and I will split the proceeds with him. The lawyer is a friend of mine so if he gets the money instead of the tenant keeping it, that is fine with me. We will see how the negotiation goes with the tenant.

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I have not done much on finding the next property. I still check every weekend, but new listings are uncommon. I have spent most of my time on the sale of my current warehouse.