All Forum Posts by: David Suho

David, this deal could work, but I’d want to dig into a few things first. 80% occupancy with long-term tenants is solid, but what happens if a major tenant leaves?
That is one concern, but the current tenants have been there for a long time. One tenant has contract expiring this year. I’m not going to pull any trigger till it’s renewed.

Are they at market rent, or locked into below-market rates? With 30% vacancy in the area, filling space could be a challenge.

They are actually all above market rent, likely because of its prime location and quality of the build.

NNN leases are great for minimizing expenses, but how much control do you actually have?
Not sure, probably not much room to make big structural changes.

Are there any caps on pass-through expenses? And with an HOA handling maintenance, have you checked their reserves? If they're underfunded, you could get hit with special assessments.

Not sure about the exact contract with the tenants, but I assume if there is any additional assessment, it would be tenants’ responsibility.

Since you want to stay local and focus on cash flow, commercial makes sense, but have you considered industrial or flex space? 
Great point. I haven’t seen much opportunities there, but will keep looking. 

They tend to be more stable than retail right now.
Mixed-use with some residential could also add diversification while keeping it simple.

This current property is actually the storefront of a mix-use residential above, but no actual residential property for purchase.

What’s the tenant mix like,

Theee major ones: One restaurant, one non-profit gallery, one home goods,

and how are you structuring financing?
conventional commercial with a down payment.

Happy to take a deeper look.