All Forum Posts by: Trey Browder

I am partial owner of an eight unit commercial retail strip center property in Lawrenceville, GA. Currently, the other partners are offering to buy out my stake in the property but we have a disagreement in some of the fundamental aspects of how to evaluate property value. The two methods being utilized are Income Capitalization and Sales Comps. Here are my questions:

1. 1. It is my understanding that lease commissions and major capital expenditures should not be included in NOI expenses since these are not directly related to the operational costs of maintaining the center. Is this a fair assumption? Feel free to provide any detailed feedback.
2. 2. The center is currently fully leased but there were some lengthy vacancies last year which certainly affected the 2019 NOI. I would like to use the current rent role, with a 5% vacancy factor, as a basis for gross revenue going forward but my partners want to base of previous two years alone. Thoughts/feedback on which approach is more applicable?
   
3. 3. There are some recent sales comps in the area but I don't have access to the specific data other than $/sq-ft and I don't believe this gives me a good comparison because I don't know what those properties cash flows were. My opinion is that a low $/sq-ft sales price could have been the result of a half-empty center or poor tenant leases. I do have three current listings in the area for similar properties with substantially higher $/sq-ft figures. Any thoughts on how much weight should be put into sales comps and listings versus income analysis as well as how to reconcile the significant differences in sales and listing figures?

Thanks,

Trey

We have an eight unit commercial strip center with mixed-use tenants including retail and restaurant. One tenant is complaining they are constantly having to remove trash from the parking area and along the store front sidewalk. They claim this litter is coming from individuals that loiter on the premises at night. We provide dumpster service but we do not currently have landlord owned and serviced trash receptacles along the store front. The tenant is asking that we provide trash cans along the store fronts along with service of these cans as part of the "Common Area Maintenance" and allocate the cost proportionately to each of the tenants. This is a bit problematic since most of our leases are not triple-net where we can recoup this CAM charge accordingly.

Is this something that is typically provided by a landlord at a commercial strip center? If not, what other possible solutions could we as landlord offer to this tenant as a sign of good will. What is our obligation to mitigate this apparent issue for one of eight tenants? Our fear is that even if we do provide trash cans and service, it won't prevent the littering and our tenant will still complain.

We have an eight unit commercial strip center with mixed-use tenants including retail and restaurant. One tenant is complaining they are constantly having to remove trash from the parking area and along the store front sidewalk. They claim this litter is coming from individuals that loiter on the premises at night. We provide dumpster service but we do not currently have landlord owned and serviced trash receptacles along the store front. The tenant is asking that we provide trash cans along the store fronts along with service of these cans as part of the "Common Area Maintenance" and allocate the cost proportionately to each of the tenants. This is a bit problematic since most of our leases are not triple-net where we can recoup this CAM charge accordingly.

Is this something that is typically provided by a landlord at a commercial strip center? If not, what other possible solutions could we as landlord offer to this tenant as a sign of good will. What is our obligation to mitigate this apparent issue for one of eight tenants? Our fear is that even if we do provide trash cans and service, it won't prevent the littering and our tenant will still complain.