All Forum Posts by: Jack Knochel

Hey Dutch, sorry I hadn't gotten back to you before now.  I just got back on BP.  We meet on the 4th Thursday at The Fox and Hound, folks start showing up around 6 and we network until about 6:45 and then start the meeting.  The meeting might be changed for this month, they had a conflict so Michelle is working on that.  I will post back here but it looks like it may be Wed instead of Thursday.  Later, Jack

Whats up Dutch and Ron? Michelle and I are in the Charlotte area, Cabarrus County. We have some rentals, have done some flips, new builds, wholesaling, and lending but now are trying to get into multifamilies. We run a subgroup for the Metrolina REIA on the 4th Thursday of every month. Its at the Fox and Hound outside Northlake Mall, you ought to come check it out. Later, Jack

@Jeff Kehl THANKS for all that info.  The reason we are thinking about this building is because it looks like we are getting it for a steal.  A bank took over another one and just wanted it off their books, their last sale price was $275k and we have it locked up for $130k.  Their broker just kept saying make us an offer they want it off their books, so we did and we went back once time and they agreed.  We are in our DD period and working on a lot of what you are talking about.  We just got in big FOR LEASE signs to unofficially put up at the property to see what kind of response we get.  There are not a ton of empty buildings in this town and the chamber and town said they have a lot of new companies moving in over the past year.  My fears are the same as you have brought up, a lot of money with no tenants locked in yet, it will take more time to fill then a rental or to sell as opposed to residential.  We are not in love with the project, in fact it scares the mess out of me.  We have been talking for years about getting into commercial if we found the right project, so we are just exploring everything we can with this one that we are bein told is a steal.  Of course that's easy for folks to say who don't have their $ involved or have $ sitting around for this, unlike us.  We have a couple investors that are interested in loaning on it and 2 banks that we have relationships with already are also interested.  Please keep your thoughts coming, it is helping Michelle and I with what we are thinking.  Appreciate your time Jeff!

@Jeff Kehl Thanks for the post, this building was foreclosed on years ago.  The owner(doctor) and his buddies decided to start a rehab on it and get caught and shutdown from the city/county.  It was his office for years so the offices are really small.  So the place has been empty for at least 7 years.  Each wall(partition) is also cement block.  Most of the electric, plumbing, hvac, floors, etc has already been removed.  We are thinking of demo the inside, removing the block walls and anything still standing and then rehabbing to a shell and hope to bring in tenants that will up fit to their liking.  The more we get into this with the city/county, and contractors, we are realizing what a project this is going to be.  Buying an existing leased up commercial building sounds so much more appetizing! 

@Chris T. Thanks.  This one has us outside the box, thats why I decided to post here, hoping to get some great advice from the experts.  The property is in Mooresville and its waking us up to commercial property in a hurry.  Nothing like residential so we are learning a ton.  We are more then likely going to push out our due diligence another 2-3 months if the bank allows us to.  We run a sub group meeting for the metrolina reia on the 4th Thursday of each month, which is next week, you ought to come out.  We just got a new location, its at the Fox and House at Northlake Mall, we'll get there around 6, network and order food until we start at 6:45.  We have Harry Marsh, local RE attorney coming to speak.  Later

Hello Priyanshu, we have gotten a demo quote of $20k to take out all the block except for the load bearing and have had other companies say they can do it for less but need to come see it.  There is the main wall that separates the buildings and then there is also a center wall in each unit that will be staying.  We plan on having an engineer come out to look at it before we'd do any demo so we can mark what goes and what stays.  Another thought was to keep one of the units with the walls and just upfit it for a Salon and then rent out each room separately to hair dressers, nail business, massage business, tanning business, etc.  This way we could have at least that part up and running in a few months vs waiting for the tenant/tenants to lease the building and do their on reno, thoughts?

Hello, we just locked up our first commercial building.  The building is a 6400 sq ft  block/brick building built back in 1965. All the interior walls(partitions) are also block.  The building is set up as 2 separate buildings, 3200 each side and each side can be spilt into a 2000 sq ft and a 1200 sq ft section.  It was used for medical offices in the past but 7 years ago the owner(doctor) thought he and his buddies should renovate it and were working with out permits.  They were shut down and it went into foreclosure.  So we are now looking to purchase it and are in the process of trying to figure out the best use.  The county government center is across the street(old hospital) and there are lawyers, dentists, orthodontist offices around the area, as well as a new brewery and pizza parlor, and the local high school is 2 blocks down the road.  This building is on a corner lot, about an acre with good parking.  We are pretty much looking at a complete rehab, electric, some plumbing, roof, hvac, knocking down walls and rebuilding once we have tenants and work out plans.  We are just looking for any advice from the commercial investors in here as to how to go about making this a success, we don't want to make the same mistakes others have if we can avoid.  We have experience in residential rehabs and rentals but this is a different animal all together.  Here is what we have done so far: meet with multiple commercial brokers out there to talk about the building and possibilities, meet with one architect, meet with multiple GC's and other contractors to start working on numbers, met with the city and country inspectors to get the relationships going and get on good graces with them since this building has a target on it, met with the city planner, meet with the chamber, talking with banks and also other lenders.  We feel like we are being fed information with a fire hose and don't want to become overwhelmed.  The ultimate goal of this is to keep it as a rental for many years to come.  Questions?  Thoughts?        

We use 5th 3rd bank.  They have a program to give an equity loan and it cost around $300 to do and it takes 30-45 days to process.  They loan 65% of arv.  We have multiple that do commercial loans on our properties and up to 30 years.  I checked and don't see 5th 3rd out in Cali but there are others like it.  Just keep calling around.  Check with mortgage brokers at your reia also, the loans are there, you just need to keep digging until you find them. 

Oh wow, good luck with that one.  We had one where it was hoarders and they had dogs and cats using the upstairs bedrooms as bathrooms as well as the upstairs bathroom as the lock up for some pets that tore the walls and all up.  We bought urine destroyer at the pet store and it was a lifesaver.  We had to replace subfloors and also kilz the walls and below the subfloor when it was open.  We also had to replace all electrical outlets and boxes and spray behind them and then seal those with foam as well as seal every seem in the floors.  Use the best kilz oil based paint and don't scrimp on riping out walls or flooring or oil based kilz.  Had to get a special cleaning for the duct work and also ran an ozone generator a ton.  Days before closing we could smell it seeping through cracks and walls and used more kilz and spray and sealer.  It was nuts, but come closing day, clean as a whistle.   

We are fixing up a rental that the tenant we evicted trashed some.  Its about ready to rent and we have some interest.  Also working on a rehab in Mooresville, its a communial living house and its about done and we already have 3 out of the 4 rooms rented.  Looking for the next deals. 

Hey Nick, where is your 24 unit in Concord? Also, we run a subgroup for Metrolina REIA on the 4th Thursday of each month in Huntersville, would love to see you and Sara out at the next meeting!