All Forum Posts by: Chris W.

I have identified a pair of duplexes for my 1031 exchange proceeds to go towards. I will have to carry a note on them, however I am putting down 47%+ on the total for both of them. 

Snag...I retire from the service in January (dyed in the wool and done) and the bank is not wanting to lend on the note. I will have my retirement check, and other income (but I can not identify it as it is recent). All 4 units are rented and grossing over $3600 a month in rent. 

Where can I find a lender in Hampton Roads that will ACTUALLY lend on something like this? I've tried a well recommend local bank and they are not able to help.

1031 45 day period lapses tomorrow. 

Not very inclined to take on a partner....

Both properties will put me comfortably over what I need to spend for the 1031. 

Open to advice, comments, or....let's talk business?

Dave Foster: 

It has been a while! I still have your emails pinned in my inbox 😁. Shame its meaning less and less these days with the title. But character and performance go a long way...especially for maintaining the relationship. 

I'll have to talk to some brokers locally (and soon) before setting on one. Small sounds like they are going to be well invested in my success. Do they go off an MLS or they only have their own listings? Pretty sure with a larger company I'd be down the food chain some. I'm going to somewhere.

Paul Moore: 

Thank you, I've done it for a great while now. I'm here for the mentoring essentially, but I'm game on at this point. I prefer not to buy an SFR for my 1031....I've had a good run, but I want more and not a multi-family dwelling. I plan to start very small with this initially. What I do build is flexible though. I am going to be careful for sure after you all advising me about office space specifically. Makes sense with Communism-19 going on 🤔.

Sean Rooks: Unfortunately I moved out in 2011 and I don't think I qualify for the tax free sale at this point. You're in my neck of the woods also 😎.

Bob Langworthy: It was formerly a primary residence but became investment. 

I definitely planned on setting up the 1031 prior to. After seeing some of the replies I am likely to look at getting something under contract first. Build to suit for flexibility is a super idea...I like that! Copy on commercial lender part. The not paying 4-7% part for management is tricky....I'm still active duty....plus I would have them do the paperwork also for taxes and leasing. I'm still researching  a lot in regards to office space. Flex space and office Suites are things I didn't think about. Common bathroom too.

Charles Kao:

I do believe I must look more in earnest for a property. I need to get a broker (vet a few first then decide). And I have some lots I like in the area....I need to lay eyes on them. Also a lawyer....🤔. Any good references for a due diligence checklist or forum links?

Dave Foster:

Good to hear your view point once again! We've spoken before a couple years ago. So the leasing broker can offer figures on leases in an area and how hot an area is? Are they different from a commercial broker? 

Does anyone have opinions on using a big company that handles everything? Like CBRE, Colliers, SL Nusbaum, Century 21....etc. these are in my area...I haven't sat with them or made contact (yet) to discuss my plans and options.

Hi All!

I've decided it is time to 1031 exchange/Reverse a property I've owned and rented out for a while. I have good equity in it and would like to get into commercial real estate instead of buying another residential rental property (not opposed to it if it makes sense though!).

Plan:

Sell it and use the proceeds to fund my first commercial property in or near the area I live in.

Questions:

Where do I start?

How do I finance if I can't quite pay in full for a property/build out? (Proceeds from property will be enough to buy small commercial lot outright with maybe some leftover....but the building?) 

Office Space is what I would like, but what are my options?

What are the rough costs for a commercial property manager say around Norfolk, Va.?

Is an all in one solution (broker/developer/architect/etc.) A good option to start with?

When I sit with a broker/company before deciding on one...what are good questions for "vetting them"?

My goal is to be mostly hands off and have it professionally managed. I want to get away from residential real estate for now. I'm active duty and plan to retire soon. Selling 1 property will restore partial VA entitlement as my current residence is also on a VA loan.

My questions are vague to get a broad range of answers and learn.

Thank you for the help!!!

@Nick C. @Russel Brazil....awesome advice. I'm going to see what my agent thinks about this.  

Bob B....She is and she certainly helped me out 10+ years ago when I bought the place.

Well this is a bit disappointing. I suppose the other option would be to see if the tenants are moving earlier, but they are still quite a ways out.

My agent has told me they do not want to list my property for sale yet due to the fact that my tenants have over a year left on their lease. I intend on doing a 1031 exchange on the property and would like to move it while the market and rates are good and it will sell somewhat quick (Hawaii). The agent told me that they don't think it will sell at a good price with tenants in the property and that much time left on their lease. They said it would be an investor loan, not owner occupant. Is it wise to wait, or just list it and see what happens? The property in question is a condo. Thank you BP community!

I take it that you also perform EAT's as well? I reviewed the white paper that you sent me and the fees. Still waiting on the guy in Hawaii to send me his schedule. What's the cost difference 1031 exchange vs. EAT and is it also an alternative to set the LLC up for the property on the back end of the 1031 exchange with no added hassles/hurdles? Does the EAT "buy" the property prior to the original unit being sold? Seems like some may balk at the concept of this. I suppose I'm confused how the EAT essentially takes possession of the new property, while at the same time the original property is still there and you can receive income from both. Or is it that both are being swapped under the LLC formed. Also does one have to get complete financing on the new property, or how does that work? If you could, what's the IRS code reference? I might just read the whole shebang to make sure I've analyzed the facets properly.

Once again @Dave Foster with the big answer win! Sounds good, is the reverse exchange akin to an EAT or an entirely different animal?

The Improvement exchange sounds appealing to an extent as it accomplishes the goal of the property being in an LLC, but can you buy the LLC itself with the asset? Like $300K property after the renovation of $50K, can you buy the LLC separate from me with property in it for $300? Or am I understanding that incorrectly and the LLC is solely for a holding entity?

Chris

I'm going to be doing a 1031 exchange on a property I own and I was curious if it is possible to use some of the funds to do capital improvements on the property(s). So say I purchased 3 homes which I understand is the maximum(?), would it be possible to use the remaining funds to perform capital improvements, and is there a maximum dollar amount limitation on this before it's considered "boot"?