All Forum Posts by: Bridget Ariel

Two investors are buying a warehouse. One investor is investing 1.3M cash and the other got approved to put in the remaining 1.3m through a hard money lender. The loan is secured by a first trust deed against the property. The term is 12 mos with a balloon payment at the end of the 12 months. The broker who found the loan swears she can find another loan with better terms during those 12 months to avoid the balloon payment. 

How do you structure this so it’s fair to investor #1 who put it in their own cash?

He runs a film production business and the contamination was there before he moved in. The seller is eager to sell to the tenant, my boyfriend. He offered a 400k credit because of the contamination when he tried to sell the building years ago. I’m sure it’s still something he’d offer

Thanks for the reply. My boyfriend isn’t bringing any cash to the table. He would be getting a loan either from the landlord or from a commercial lender. He’s been at that warehouse since 2013 and put a lot of money into it. He can find another building. It would just cost him a lot of down time. It’s in a good area in Los Angeles and there are a couple major tenants nearby. The value of the building has been going up year after year. His lease ended in November so he’s been month to month. He fears an outside investor will buy the building and raise the rent (he currently pays 10k a month before property taxes etc) or move another tenant in. 4 other investors made all cash offers on the building. They are now reviewing a lengthy phase 1 and 2 environmental report. The building has some contamination which isn’t unusual for the area. They’ll probably come back with lower cash offers after they review the reports. You’re right about my family not investing in the warehouse if it wasn’t for my boyfriend. They even offered to never raise the rent at some point which doesn’t sound realistic to me. If my boyfriend moves out, they’d have to find another tenant....and you’re right my family would probably be liable for any loans my boyfriend takes out so it’s not bringing cash to the table. 

Just looking for some advice here. My boyfriend runs a business out of a industrial warehouse. It's listed at 2.6m. My grandmother offered to help buy the warehouse and offered 50% in cash (1.4m). My boyfriend's landlordoffered to hold a mortgage for the remaining 50%. The warehouse would go into a family corporation that owns and manages the warehouse investment. My family does not include my boyfriend...my family's rules and not mine....each member of my family of five would be partners in the corp so that when my grandma passes, the investment is distributed equally among the five family members including my unborn child...my boyfriend is the father. When my grandma passes, Both the baby and I each have 20% ownership.Include voting rights based on percent ownership so that after she passes, the majority of my fam vote to replace The baby with my boyfriend. phewww, stay with me!
To me, it sounds unfair that my boyfriend wouldn’t get any ownership If he’s putting the deal together and making the loan happen with the landlord but my family doesn’t see it that way. On the other hand, his business would face shutting down if an outside investor bought the property and either kicked him out or raised the rent like crazy.
My boyfriend just spoke with some commercial lenders and they are all positive he would qualify for the 50% remaining cash so he doesn’t have to go through the landlord. He wouldn’t qualify for the full 2.6m so that’s not an option.
Getting the loan through another lender is ideal for him because the landlord wants to get paid back in five years.

here’s my question.
how would I present this to my family so he rightfully gets ownership because he's be bringing half the cash? How would we structure this so it's fair for everyone? I am not experienced in real estate investments so I'm sorry if I made it confusing!

Just looking for some advice here. My boyfriend runs a business out of a industrial warehouse. It’s listed at 2.6m. My grandmother offered to help buy the warehouse and offered 50% in cash (1.4m). My boyfriend’s landlord offered to hold a mortgage for the remaining 50%. The warehouse would go into a family corporation that owns and manages the warehouse investment. My family does not include my boyfriend...my family’s rules and not mine....each member of my family of five would be partners in the corp so that when my grandma passes, the investment is distributed equally among the five family members including my unborn child...my boyfriend is the father. When my grandma passes, Both the baby and I each have 20% ownership.Include voting rights based on percent ownership so that after she passes, the majority of my fam vote to replace The baby with my boyfriend. phewww, stay with me!
To me, it sounds unfair that my boyfriend wouldn’t get any ownership If he’s putting the deal together and making the loan happen with the landlord but my family doesn’t see it that way. On the other hand, his business would face shutting down if an outside investor bought the property and either kicked him out or raised the rent like crazy. 
My boyfriend just spoke with some commercial lenders and they are all positive he would qualify for the 50% remaining cash so he doesn’t have to go through the landlord. He wouldn’t qualify for the full 2.6m so that’s not an option. 
Getting the loan through another lender is ideal for him because the landlord wants to get paid back in five years.

here’s my question.
how would I present this to my family so he rightfully gets ownership because he’s be bringing half the cash? How would we structure this so it’s fair for everyone? I am not experienced in real estate investments so I’m sorry if I made it confusing!