All Forum Posts by: Ben Firstenberg

Agree with what others have said and will add, make sure to keep reserves. Some months you'll do great, some months might be $0. Make sure you can ride out the bad months.

If you're interested in investing here in Atlanta, please feel free to reach out! I work with a lot of investors and would be happy to help 

Lots of great market suggestions here. I gotta throw one out for Atlanta. 

Atlanta is growing very quickly and there's already a shortage of housing here. We're expected to grow from 5M to 8M residents over the next 20 years. Many parts of the city are growing and changing very quickly and there's lots of opportunity here. 

I will say, the monthly cash flow isn't that great, but there are some ways to juice cash flow that we can talk about if you're interested. Feel free to reach out! Contact information in bio

When evaluating a market, I look at the following

- Crime

- Quality of local schools

- Quality of local retail

- Proximity to jobs

- Quality of nearby single family homes (is there pride of ownership, or are homes being neglected?)

These are some of the main criteria that determine where people want to live. Also use your gut feeling! Does the neighborhood seem pleasant, do you feel safe, would you feel comfortable with your wife/kids/family walking around there at night? 

As far as professionals, I advise to start with the agent. Find a good investor friendly agent and you're well on your way. They should be able to introduce you to contractors, property managers and lenders. 

Hope that helps and thank you for your service!

I think the biggest nuance is commercial/retail leases can be very complicated and finding tenants can be somewhat difficult, although there are retail tenant brokers who can help with that. 

Not sure how much you know about retail leases, but they're typically NNN and frequently include provisions for so-called tenant improvements, meaning you front some money (I've seen anywhere from $10-50/SF) to build out the space for the tenant. Some times they pay that back on top of normal rent, sometimes they don't.

The good news of course is retail leases are generally much longer and therefore offer more stable cash flow. The quality of the tenant also impacts the cap rate the property will trade for, so if you're able to sign a high value tenant to a long lease, you can create a lot of value.

Hope that helps! Happy to talk more

I have some experience with out of state investing and I agree that finding your agent, contractors and property manager first are crucial. In fact, I'd say that even if you're in state! Once you make the purchase, the clock starts ticking. Every month, payments are due and expenses will eat a hole through your bank accounts. You want to be as ready as possible before you jump in. Ideally, you can get all of the pieces in place and then jump in an execute right away. 

A good agent is a great first step. He/She will be able to connect you with contractors and managers to help build out your team. A good agent will also understand the pitfalls of investing out of state and will help you mitigate the risks. 

My brokerage works with a lot of out of state investors and as I mentioned, I invest out of state as well. Happy to talk more if you're interested (contact information in bio). I also highly recommend Atlanta as an out of state market, for the same reasons you like DFW. 

I would think about which is more important to you and if there's ANY way you could do both. 

I personally think starting the business is the better path, as it has much more upside potential, but does it have to be all or nothing? Could you work a job and develop the advising business on the side? 

However, starting with some kind of job, investing in real estate and waiting a few years before you start the business is probably the more reliable path. Starting the business immediately is risky. If you can get some cash flow from the real estate going and you know that your basic necessities are covered, it's a lot easier to go out on your own and start a new business.

Happy to talk more if you like

If you feel you're lacking knowledge, I'd strongly recommend making it a practice to listen to the bigger pockets podcast and read these forums every day. The bigger pockets books are really great as well. You'll be amazed how much you learn by just doing a little bit every day. 

Depends a little bit on the property. If it's a big commercial property, you're going to need a lot more. But I'd start with:

- Rent comps and sales comps to support your assumptions

- Estimated property financials / Proforma income statement

- Write up of business plan

- Estimated return metrics

- Analysis of the location

- Information about you and your experience. If applicable, include information about the contractors/PMs you'll be using. If they have lots of experience it can certainly support your case

Commercial property is typically valued with cap rates. If you're not familiar, you calculate net operating income (NOI) and divide it by the cap rate (usually in the neighborhood of 5-12%) and that gives you an approximate value. It's sort of like price/earnings ratio with stocks.

You don't necessarily need a commercial agent or an agent at all, although having one would probably help. Any agent that knows about investing could probably help you with this. 

I would keep reaching out to the listing agent, sometimes agents either aren't good at responding or get busy with other things. 

Happy to answer any more questions

You will have a higher rate but it's not set in stone. If rates come down in a few years you can refinance again and reduce that payment. 

I'm always in favor of holding the asset as long as possible, so if the property's income can cover the debt payment on the refi, I would do that.