All Forum Posts by: Etienne Turner

Hey Simon, 

Thanks for providing input. Yeah, I decided to move forward with the couple. 

- Etienne

Hey BiggerPocket Members,

I need some advice and direction. I'm very new to real estate and only have one deal under my belt. I have recently purchased a shopping plaza back in November, and I’m trying to get all my tenants all locked up. I currently have one last unit to get under lease. I have been marketing this unit for about a month and a half and have had only one serious inquiry. I need some advise on this potential tenant.

The last unit was previously leased out to a pharmacy for several years. I recently met this lovely couple, which also have an existing pharmacy business, and would like to lease out my last unit. The problem I face is that they would like to have substantial rent reduction for the first 6 months. Apparently, before a pharmacy can begin doing business, their new space needs to be filed and approved. This period typically takes around 3-6 months. Below is what I offered and what they countered.

I offered:

2-Year Lease with sales tax included in rent

2016

• January: $0
• February: $428
• March: $535
• April - September: $1,605
• October - November: $1,712
• December: $1,819

2017

• January - December: $1,926

They came back with a 3-year lease with no sales tax

2016

• Jan - Feb: $0
• March - April: $400
• May - June: $500
• July - Dec: $1400

2017

• Jan - Dec: $1600

2018

• Jan - Dec: $1800

I spoke with them today, and they seem like great people. They seem like they would be a great tenant to work with and they plan on staying at the shopping plaza until they retire.

Here’s my rational to taking the deal:

• I like the both of them very much
• I believe they would be great tenants to have (no headaches)
• I can lock that unit up for several years for consistent cash flow

My rational for not taking the deal:

• Substantial rent reduction for the first 6 months
• Overall under market rent payment

My question to you members is it worth taking the reduced rent reduction for the first 6 months and have overall cheaper rent per square foot in order to lock up cash flow and have, from what I believe, a great tenant? 

Hey Justin, 

I'm happy to provide you more insight on my first deal. 

I was hired to install a POS/Inventory system at a local building supply company, which took about a month to complete (their inventory was huge). But while I was there, I met an individual who brought the property to my attention. I viewed the property and ran the numbers in order to validate if it was a good deal or not, and came to the conclusion that it was. I came back to the owner, of the building supply company, and presented my case. I walked him through my numbers and convinced him to go all in with me with a 30-70 equity partnership with him putting up the entire capital to buy the plaza. I know others have gotten 50-50 with a similar situation, but I was willing to have less in order to gain a great connection with a building supply company for my future house flips. In my mind, the connection/relationship was worth it. 

-Etienne

Thanks all for the warm welcome, and thank you Linval for the resources and pointers. 

Hey all,

I am a new BP member from Tampa, FL. For the past 2 months, I have been trying my best to learn all I can from BiggerPockets (blogs, podcasts, etc.), and have been loving it. Last month, I found a partner and purchased my first real estate deal, a commercial plaza that currently has 5 tenants and 2 vacant units. After getting 3 out of the 5 tenants under lease and projecting the annual rent from the 2 vacant units, I should be able to receive a 21% ROI!

I am currently interested in residential homes, for flipping purposes in order to generate cash, and commercial properties such as duplexes, triplexes, small apartment complexes, and plazas for passive income channels.   

I am very new to the real estate world, but my long-term goal is to become a full-time investor. I would love to meet other investors in the local area to talk about plans, strategies, and just share info and hang out. 

Also, I'm in the process of searching for a mentor/or part-time work working in RE office to gain some experience. My professional background, aka my skills to offer, are: BA in Business Management/Entrepreneurship from University of Central Florida (GO Knights!), experience in online marketing: SEO, PPC, Web Development (started my own business right after school), and some limited small time business consulting work. 

Fun fact, I lived in Moab, Utah for 3 years as a river guide down the Colorado and Green river. 

Looking forward to hearing from you!

- Etienne