All Forum Posts by: Terri Pour-Rastegar

@Mav Larson, Yes, in a true NNN commercial lease, tenant would pay for everything. But I don't need to make a killing on this property, and I'm trying to help out a fledgling business. Given the 12-child limit for this unit, she's going to make only so much each month--not enough to support a NNN lease. So I've modified things considerably to make it a win-win situation for both of us. She's getting a gorgeous building that LOOKS like a commercial daycare that's move-in ready, with rent and utilities that she can handle from day one; and I'm getting a steady stream of income from a little business venture that is more likely to succeed long-term.

@Jai Reddy, Hello!  I am currently working with an interested party who will be renting my 1900+sf daycare at $1200/mo + utilities.  This daycare is not a commercial property.  Zoning will allow only for a "Daycare Facility in a Residence," which means the daycare operator must 'live' in the property and can have up to 12 children (versus 50 I think if the property is zoned commercial).  So we have opted to use a commercial lease with modifications.  For example, Tenant pays rent and all utilities and routine maintenance and small repairs.  However, we pay taxes and our insurance.  Tenant is required to carry a certain amount of insurance, per lease.  Tenant has already gotten everything she needs from DHHS, and has begun the process of obtaining a new Certificate of Occupancy from city zoning--she must pay for all of these fees.

I am new to this sort of rental (all other properties are strictly residential and I do not allow for any businesses on site without prior written approval and possible renegotiation of the lease).  And I am dealing with potential tenants who are starting up a new or bigger business venture--so their success is my success--so I'm working closely with this woman to help her along the way.  And I'm learning as I go.

Like I said, I'm a newbie in this realm, but I'm happy to share my experience with you.  Feel free to PM me.

Welcome, @Khadija Hunter!

You're already off to a great start with Bigger Pockets.  @Paul Timminsgave you even more great info. 

I'll be more specific and wholeheartedly encourage you to become a member of the local REI group, Metrolina Real Estate Investors (http://metrolinareia.org/). They are very active and provide so much information and support--as well as great connections. They have a monthly main meeting, as well as numerous subgroup meetings and workshops and so much more. I encourage you to join--they have a 30-day trial membership for just $1. Take advantage of what the MREIA has to offer--you'll not regret it.

@Michael H., I believe you have a Surplus Warehouse in Raleigh.  Here is their website:  https://surplus-warehouse.com/store/raleigh. 

I now buy all of my cabinets from them.  The store in Charlotte has all sorts of cabinets, including very good quality pre-assembled cabinets (all-wood construction--no particle board) for an amazing price.  I have found they are better quality and much less expensive than anything else I've found.  They have 3 or 4 door styles/colors to choose from.  Each store is different, so check your local one.  They also have really nice bathroom vanities, granite vanity tops with the sink installed, flooring, doors, laminate counter tops, windows, and tons more.  I've also bought some of their special order cabinets for higher-end rentals and flips.  Usually they are RTA, but our store now offers a very reasonable fee to assemble them for you--definitely worth it, in my opinion.

Whether you buy RTA or pre-assembled cabinets, I recommend you always try to buy full wood construction--no particle board.  I must disagree with the previous post about the stability of particle board, based solely on my 15 years personal experience.  If particle board gets the least little bit wet, it swells up and breaks down.  I NEVER use particle board in a bathroom, and I avoid it elsewhere.  However, plywood is quite stable.  Consider this:  It's used as roof decking, subfloors, and more, and it does just fine.  Also, if ever there is damage to a plywood box, you can often repair it with a little wood putty and playing with stain to match.  With particle board, all you can do is replace the cabinet.

Let me know what you think of Surplus Warehouse.  Good luck.  :)

@Jeff S., When I get my hands on a house, I repair everything necessary up front.  I always get a professional home inspection.  Then my plumber, electrician and AC tech go through the house with a fine-tooth comb and repair/replace whatever is going to cause me problems in the future.  I upgrade to 200 amp, insulate, replace dated light and plumbing fixtures, replace the roof if necessary (or budget to replace it if it has a few more years on it--I just don't wait until it starts leaking), fix any drainage issues, replace windows (maybe 75% of the time), make sure doors/hardware work properly (I install hinge-stops and/or those round plastic bumpers that affix to the wall so I never have wall/door damage), limb up or remove trees, and of course give it a thorough cosmetic upgrade so it attracts good tenants. Those last two words are key also.  Good tenants will let me know if something isn't working quite right, which usually heads off most emergency repairs.  Good tenants are also less destructive and care better for the property.  Plus, they stay awhile, which saves me money in the long haul.

The Charlotte market has been good to us so far, even in the recession (especially in the recession!), and I guess we've been buying right, too.  My husband still works, so we have always turned our rent into capital to buy the next properties.  Only this past year did we begin draw dividends--we are beginning to put his income into the savings account and transition to living on the business income so that he can retire. 

$375/day is nearly $50/hour, but a really good handyman--one who doesn't need his hand held and can pick up/pay for incidental materials--is worth it.  I'm not sure about finding people from Home Depot or Craigslist, but word of mouth has always been good to me.

I'm embarrassed to say I don't know if handymen are supposed to be licensed around here.  Really, he is the only worker I use who is not licensed or insured or whatnot.  My handyman is also a roofer (started out that way), so when he does roofing for me, he gets an insurance policy with me on it for that project. Of course, my insurance broker is probably freaking out about this.  LOL.

Hi @Jeff S.

Great topic, by the way.  Although when we started investing, we did all the work ourselves, as soon as we had 3 properties under our belts, we began hiring out the work.  First was HVAC, then plumbing and electric--I do not leave those items to a handyman.  I use the very same plumber and electrician for every single project--big or small.  They've gotten to know me and how I like things done (right, the first time, and to code, please!).  Maybe I pay a little more, but the peace of mind in knowing the job is done right is worth it to me.  Plumbing, and AC comprise the majority of the trade-specific repair calls I get (until, of course, my trades get in there and fix everything right--then the phone is quiet).

As for the little piddly stuff, it is not easy to find a jack-of-all trades. My suggestion is to be involved in your local REIA--ask around. Be specific. Beg for the name and number of everyone's favorite handyman. That's how I found the guy I use. Most of the time, I can simply call him up and tell him what to fix. He sends me pictures of the before and after, and calls if there are any surprises. I've been working with him for nearly 6 years, so it's a smooth process. I'm probably going to lose him soon, as I've given his name out to so many people, he is now often too busy!

So, I have learned to 'batch' projects for him.  I'll tell tenants if a repair is not urgent in my opinion, and that my repairman will be around to fix things next time he's in the area.  When my handyman is available, I make sure I can keep him busy for at least a half day, but a full day if possible.  I've learned to give him a heads-up, that I have a few things here and there that need attention.  He works out his schedule and squeezes me in.

This past year, I just began something new, that I think is going to work out great. I asked all my tenants to email me a list of any repairs or concerns that needed my attention.  I had my handyman go with me to each of our properties (at the time, 14), and we inspected everything together. He made most repairs right on the spot; others, we scheduled them to be fixed at a different time, when we had the materials or such.  If something needed a different trade, I scheduled that right there in front of the tenant.  Tenants loved this!  And I managed to keep my handyman busy for two full days.  I paid him more than the $375/day he usually charges, because he is such a thorough and fast worker.  He's worth his weight in gold.  I think I'll keep doing this, probably twice yearly; though now we have 18 properties, so it'll take three days probably.  I mentioned this because it might help you with your situation.  If you're pro-active with repairs, you can keep ahead of them and schedule them when it's more convenient for you.  Of course, we can't catch everything--in those cases, try to batch the repairs to make it worth a good handyman's time.

BTW, even with 18 rentals, I can't keep a handyman busy anywhere near full-time.  If I don't have a rehab project going on, I use him, on average, 2-3 times monthly.

Wow.  Sorry for the lengthy comment. Hope it helps.  :)

Do we have to wear green?  Because, you know--St. Patrick's Day.  ;)

Wow!  @Ricardo S. --that's a gorgeous place!  I'd love to sink my teeth into something like that.  Keep us posted on the progress.  :)

Welcome aboard, @Valeriy S. ! I'm not a real estate agent, but I'm a like-minded investor here in the Charlotte area. You're on the right track, connecting with folks here on BP and attending the local REIA meetings--they have several great subgroups with their own meetings as well.

Good luck!  

Welcome, @Millie D. !  I, too, am a big softy for these older homes and have lovingly restored several throughout the years.  My contractors think I'm crazy when I tell them I'm saving the old doors or crown moulding or such.  I actually have a little blog on here about an old house I rehabbed in Fort Mill.

I'd love to connect and talk shop about some of the projects you've done.  I focus on Charlotte, Lake Wylie, and Fort Mill, FYI.  :)