All Forum Posts by: Armand Soto

Hello all,

I am looking at a potential office building deal and I was hoping to get some thoughts from the community on what people look for in office rentals. I have experience in analyzing small multi-fam properties but my knowledge of office rentals is limited. This is a smaller size office building (~5000 sqft.) with 8 office units and IS NOT a NNN property. My main question is, what do office investors typically look for in terms of cash flow assuming the CoC ROI meets your hurdle? I am used to small multi-fam analysis where I would be looking for a certain cash flow per door but is that the right approach on an office building?

Was hoping to get others' thoughts on cash flow based on their experience with small office rentals.

Thanks in advanced!

Great to hear everyone's take.  Thanks, all for the input and wisdom.

Thanks, all for the great feedback!  I appreciate all your help.

My wife and I purchased a 2 flat a year and a half ago and we currently live in one unit while renting the other out.  I have a great tenant that has never been late on rent in the 1.5 years that she has been my tenant (I inherited her when I purchased) and has never caused any problems.  Her lease is up at the end of May and recently she asked about having her boyfriend move in with an anticipation of re-signing for an additional 12 months.  I let her know that I would like to go through the background check process on him (I used Smartmove) prior to him moving in and they agreed.  After pulling the report, I found that there was a DUI around 5 years ago.  The Smartmove report came back with an Accept recommendation but I don't know how much weight to put behind it.  My tenant has been exceptional and I would hate to lose her but adding her boyfriend to the lease is a bit unsettling to me.

Questions:

1. How have you treated DUI in terms of accepting/denying a prospective tenant?

2. Should I let the lease expire, let them live on a month to month as a trial period and if problems with him arise, look for a new tenant?

Thanks!

@Casey Walker- Thanks for the suggestion.  I will look into those.

@John Warren- I appreciate the reply!  I have noticed that in the area as well.  It's been tough to get good contractors.

@Greg Dickerson thanks for the feedback!  Sorry, I meant to include that info.  House is 2 level, 1700 sqft.

I am analyzing a potential flip opportunity in the Chicago-land area and I am wondering if anyone has previous experience in adding duct work and forced air units to an old house.  The current boiler is pretty new (3-5 years) but all of the comps in the area have forced air so I am thinking that it is a must have in order to compete.  I have a contractor that told me it will cost around $15k to add the forced air units (he is suggesting one for upstairs in the attic and one for downstairs in the basement) and all of the duct work.  Has anyone experienced the cost on a job like this?  This cost of adding (at that price) would definitely eat into the profits quite a bit.

Also, would it make sense to remove the boiler units from the rooms if the boiler is like new?  Wondering if it would be easier to just leave the units in the rooms as a back-up.  One thing to note is the area is a historic district with a lot of old homes and some do still have the boiler units in them although they have been updated with forced air.

I appreciate any feedback anyone has!  Thanks!