All Forum Posts by: Account Closed

I am not familiar with Florida's current luxury market, but I can comment how luxury is marketed here in Hawaii.

1) Personally you need to market yourself in that arena, promote yourself as a luxury specialist. Maybe take some classes, get a credential. This will help with both Buyers and Sellers perception.
2) Advertising in some magazines that show only luxury. I think one locally that has good circulation is "Luxury Homes".
3) Professional tours, possibly even web sites (landing pages on your site) (maybe Seller would split costs?).

Maybe I misread your post. If you want to target market in Canada and Midwest...

1) Build your internet presence for luxury. The Buyer's searching from abroad are using the internet, so they have to find your site more then anything.

Hello just wanted to introduce myself, although I've been posting for a few days, I think it would be good to introduce myself.

I am the Broker In Charge of Yamanaka Enterprises Inc. here on the Big Island of Hawaii. From a brokerage stand point we specialize in large land management and sales as well as commercial and luxury real estate.

I am the 3rd generation in my family to be in Real Estate here in Hawaii, and we have represented clients from all over the world and have consulted for those clients on transactions for property from Japan to the East Coast.

As we are located on an Island and in a small market we do also perform real estate services in other areas, such as residential, long term commercial and residential property management and short term vacation rentals.

From an Investment standpoint we are primarily focused in 4 locations, Hawaii, Nevada, California and Oregon. We are long term holders of income producing property recently only commercial.

I look forward to meeting and discussing with everybody on these boards. I have read many discussions and find these boards very interesting.

I agree with Jon. Be specific in the details, its what you leave out that will come back to bite you.

This probably doesn't apply, but are there any applicable federal codes (i.e. FEMA) that apply to this building? In places like where I am Hilo, HI, certain near ocean parcels are affected by FEMA which affects how much cash you can spend on repairs until you have to actually have to upgrade to current code. For older buildings this becomes something that is a deal killer as you will not be able to lease out your commercial space for what it takes to bring up to code.

For what its worth. We have property in a few different states. Hawaii, California, Oregon and Nevada. Managing the property iis a full time job and we manage (for the most part) all our properties, from Hawaii. Based on that experience I will say that you need to have a PM for residential on the ground near the property. Is it a pain to find quality? of course. Do you have an option? I do not think so... unless of course you have some sort of density to justify hiring a person who can focus specifically on your property.

Commercial on the other hand allows you a little bit more lee way.

As for, when we are retired and out of the business, we will hire a property manager. We will research to the best of our ability to source one that meets our needs. If you are not going to handle your properties personally their is little other choice then to hire a PM and deal with it. There are good PM's out there.

I agree with Mark Brian. It depends on your State laws, but if there is any doubt... Disclose.

$100k, I am sure you can get into a commercial property with that, but there are a few considerations.

Your question was "how much do you need?" but the question you should be asking is "what is a reasonable return on investment?"

A very simple return is based on Net Operating Income (NOI). Which is calculated as such.

Potential Rental Income
– vacancy & credit losses
= Effective Rental Income
+ other income (collectables)
= Gross Operating Income
-total operating expense
= Net Operating Income

You can then apply that to a capitalization rate. This is done only for the past years NOI.

NOI/Purchase Price = Capitalization Rate

A good barometer I like to use is a 10% capitlization rate, but every investor has their own rate that they like. Most seasoned investors take it far past capitalization rate to IRR after taxes, but that is for a different thread.

You shouldn't be looking to accomplish your investment goals with one transaction, but instead look to build up to those goals, whatever they might be. Supposing you have $100k, you can easily leverage that into a better returning property, but there is also risk that you have to take into account and as it sounds like this might be your first investment property I would keep it as simple as possible and stay away from being too leveraged.

I am rambling on, and apologize if I didn't answer your question.

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Vikram,
I recommend both as well. The more knowledge the better. As for finding a broker who can meet your needs I would find a CCIM who specializes in MF, make sure the Broker has the designation and is not in the process of completing it. Although there are many good Agents in any marketplace who do not have the CCIM designation, by going with an Agent with the designation you will know that you are getting an Agent who knows how to break down a property and at minimum can run a Discounted Cash Flow Analysis on property as well as someone who would have actually completed transactions where CCIM methods were used.

Designees go through a peer review analysis of the transactions they submit as proof of work completed and so you can feel a bit more confident that a CCIM has done work in the field and done analysis that is important when looking at investment property.