All Forum Posts by: Brett Peters

@Stephanie Simmons Just in case no one pops up with a personal referral for you. You can go onto www.ccim.com and search for a commercial broker by area and specialization, by clicking on "find a ccim". I am a member of the institute and all of these individuals are top of their class.

@Danh N. In regard to discounted property. Repricing will take place wherever occupancy is limited. A restaurant that can only serve at partial occupancy will have a different NOI, likewise for other asset classes affected. However, I don't think we will see this with apartments. It should be noted that cap rates will most likely remain the same, while the NOI itself lowers the value. But if we compare this to the last recession, buying opportunities should start popping nearing the end of this year. But yes, there will definitely be inventory at a discount.

 As for CCIM, I am a member of the institute and have one class left to take before designation. To answer your question, it is a fantastic program and worth every penny. However, whether this stuff will benefit you depends highly on your market and your level of deal activity. The material is extremely high level and the reality is, it not as easily applied in every market. If you do go for it, I suggest you take "Foundations for Success" as a warm up. It is less expensive and it will give you an idea of whether to go forward. Best Wishes

@Sri L. You've made very good points. I agree with you on the conversion of hotel to multifamily, and it would pose a tangible solution to the affordable housing crisis. 

 In regard to retail, it is a little trickier. We know we can't stick a warehouse beside a Taco Bell, right. But I think medical office, urgent care etc. The healthcare industry is an enormous economic force. It is the nation’s largest and fastest-growing employer, as I'm sure you are aware. 

 Currently, in my market we are seeing the conversion of some office into warehouse and some warehouse into medical office. Although, the last scenario has caused problems in efficiency percentages. But mostly I have seen just paused development. Let me know your thoughts.  

@Danh N. I specialize in CRE in the Pa area. @Ryan Daigle has given you good advice. In addition, hospitality is in a windfall. RCA analytics reported that reported that only 10 hotel transactions took place nationally last month. That is a historical low, running about half of sales activity during the crash of 08-09. In addition, hotels are just being allowed to operate at 50% occupancy. In my opinion, I would stay away from hospitality for a year or two. But to answer your overall question, the real way to take advantage of this recession is in "adaptive re-use". Values will be dropping soon due to the fact that these types of properties, (including certain types of retail and office) will have to be "repriced" according to the new occupancy regulations. Buy at a discount and convert the space to something that is in high demand.

@Steffany Boldrini The answer is yes, COC does include principal and interest. Cash-on-cash is cash flow before tax divided by initial equity investment. Since Cash flow before tax is NOI - ADS...the ADS includes both principal and interest from the year in question.
-Uses

▪ Often used to calculate the length of time required to return the initial investment to the investor. (The reciprocal of the cash-on-cash return is an estimate of the number of years required for the investor to get his or her equity investment back, assuming the same cash flow each year.)

▪ Determines the yield estimate for short-lived investments with no change in value. ▪ May be compared to the dividend on a stock, the interest payment on a bond, or the equity dividend rate used in real estate appraisal. 

▪ Determines the yield estimate for an investment purchased for annual income, not appreciation (and assuming no depreciation).

@Rawn Wilson You have every right to pursue litigation and you should, so long as it does not cause you financial strain. 

@Timothy Douglas You would need software to aggregate the data. A local commercial broker should be able to supply this. If you have trouble acquiring this information, feel free to shoot me a message in my inbox and I'll run the report for you at no cost.

@Timothy Douglas Smart man. Depending on the size of the lots you have many options here. You can maximize the value of the office buildings directly or indirectly. Additional parking would impact the value directly, but you have to assess the current parking ratio of the buildings and see if there is actually a need for it. Parking lots can drastically impact value, and in some markets there can be a higher valuation assessed on the parking than the offices themselves.

 Adding a retail location would be a good way to impact the property indirectly. In other words, it would be an added feature of the area and benefit to employees.  A QSR for example would synergize well with offices. You also have to ask yourself how involved are you trying to get with new development which is costly these days. If you want to avoid all of that I would suggest doing a ground lease. Or simply sell the land to a developer, in the likelihood of them doing a build to suit for a new tenant and you can reap the same rewards versus tying up your own capital. (It really comes down to what the site and location need most). The real answer rests in the current parking ratio and a "gap analysis". The gap analysis will show you exactly what type of retail is in over supply or under supply. That will get the ball rolling in an evidence-based direction. I hope this helps!

@Jason Malabute www.ccim.com

@Jason Malabute @Nick Giulioni I would strongly recommend searching a broker in your area via the CCIM website. Simply click on find a "CCIM" and you can filter them by experience and specialty. All are in the top of their class.