All Forum Posts by: William Yeh

As others have stated, you have not provided enough information to determine whether this is a good deal or not. The major pieces of information you are missing include NOI which includes deducting all of your operating expenses from your gross rents sans debt service, market dynamics (what are vacancy rates and asking rents like in the market the building is located in?), status of major building components (roof, HVAC, structural, electrical, plumbing), accounts receivable aging (are all tenants paying or is the $20,500 schedule rent?), and lease history to name a few.

Don't be lulled into complacency by seller financing either. Maybe they are offering financing because no traditional lender will lend on the building. Too many investors treat lenders as an impediment to their deal. We look at lenders (so long as they lend in the asset class you are considering) as an additional line of due diligence (they deeply care about their money and they are likely more sophisticated than you are). If you talk to enough lenders that do office lending and they all shy away from the deal, that should tell you something. Alternatively if they all love the deal, that's also likely a good sign.

You can get a dog of a property in a crap neighborhood that will yield a 13.6% gross cap (not saying yours is), but that certainly doesn't tell the whole financial picture of how the asset will perform.

Hey Jane,

Just curious are you looking to pay a mentor? Or are you looking to hang your license under them? You've got a lot of requirements which is good but it might help to understand what value you are bringing to the table for your future mentor.

Cheers,

William

Congrats Tommy! Curious to track your progress as the deal continues to develop.

Welcome Gail! BP is a great community and I wish you all the best on your real estate journey. Happy to connect!

Hey friends!

I just recently took down a listing on a multi-tenant dental office building in Sacramento that is 85% leased with one vacant unit left, fully renovated, and in a market with barriers to entry. The building is full service with CAM recapture based on a base year methodology. The owners have priced it at a 6% pro forma cap rate assuming the last unit gets leased out at honest current fair market rates ($2.75/sf).

My question to you all is what are you seeing/expecting in terms of trade caps for comparable property in comparable markets? In observing everything that I have about the recent volatility on interest rates and commercial markets, it seems like sellers are buyers are somewhat divergent in their expectations. Are all of you commercial investors our there still doing deals and if so what kinds of terms/numbers are you seeing?

Cheers and thanks in advance for your insights.

@Danny Bittiker To your point, all you are looking for is access to the MLS so the reputation of the brokerage would seem irrelevant no?

I'd recommend finding one that specifically is a member of the San Francisco Association of Realtors (SFAR) assuming that is the area you want MLS access to. Even though all of the Nor Cal MLS's have data sharing agreements, ever since they all went insular and consolidated everyone's data onto their own native platforms, it's been something of a mess.

I've found that you still want to be a member of the home MLS where you will be doing the bulk of your business as not all of the data always gets shared properly between the various systems which cover Nor Cal.

Hope that helps.

@Marco Fiore As many have already suggested, it's all about exposure. How many people know what you do and think you're good at it? Figure out the most natural ways to you on getting the word out, whether that's in person, social media, youtube, tiktok, onlyfans (kidding...maybe?), or some combination thereof. For me I've largely leveraged my personal Facebook account and have found almost all of my clients in my sphere of influence.

I got my agent's license almost 10 years ago, became a broker 5 years ago when I started Yeh Area Realty, and only recently did I get off my lazy *** to put my own website together, largely spurred by a new agent that joined my team and beat me to it :D. Prior to that, the only marketing I did was treating every client I have like they're royalty (responding in minutes not hours), advising them from a wholistic approach, not just as their broker, getting them a ridiculous closing gift, and asking them to leave a review for me on Zillow. I then dropped a simple bitly hyperlink to my Zillow reviews page in my email and over the years it's been clicked on over 2,500 times. Then when I went to create my website recently, I was able to draw on those reviews to add content.

All it takes is hustle and a little bit of foresight. Report back in this thread when you go big time and let us know how you did it ;)

Hey Austin,

I'm curious what regulations specific to Oakland that a CPA would need to know in order to advise you on tax strategy. Do you have specific ideas in mind or are you just concerned that you're missing something?

I've brokered multiple deals for my group throughout the greater bay area in both residential and commercial and our CPA is located in the central valley. Nothing is really coming to mind with regard to city-specific knowledge that a CPA would need in order to advise us on tax efficiency. They just need to know the common stuff such as 1031s, cost seg studies, proper classification of depreciable improvements, etc.

In my experience, it's tough to find a good CPA that knows the ins and outs of real estate taxes as there seems to be a shortage of well qualified ones. I'd recommend educating yourself as the general knowledge and big picture strategy is readily available out there.

Curious why they are requesting a CV. Are they a particularly prestigious broker? What value in your view do they bring to the table?

If you're talking about finding a lender that will lend to an LLC for a residential property, most banks will say no. Last I checked, we were only able to find one portfolio lender that would do it and the loan term/amortization/rate were all way worse as compared to a Fannie/Freddie loan on a home done as an individual. If anyone has lending resources for SFR in CA that will do it at competitive rate/terms, I'd be highly interested.