All Forum Posts by: Jeremy Cyrier

What you're really trying to do is formulate an opportunity cost analysis to figure out where your capital is best invested. You're also looking at a time value money problem that would involve using an internal rate of return calculation instead of a cash on cash return (only tells you a one year story). You also mentioned after tax. What's your marginal tax bracket and how long do you want to own the investment?

I just posted a new pdf report entitled "6 Commercial Real Estate Investing Predictions for 2013 and Beyond" and thought you'd like a quick summary of what's inside.

1. Tax Changes Gives Investors Pause, Causing More Conservative Underwriting
2. Apartment Investing Remains Hot
3. Retail Recovers and Resizes
4. The Land Market Heats Up for Home Building
5. Office Demand Realigns with New ?Work Trends
6. Industrial Holds Steady with Modest Gains

What do you see happening this year?

I use ProspectNow because they do the look up research and dig up phone numbers - and sometimes email addresses, too.

Have you considered finding a developer to join venture with you on the development of the land? You can pledge your equity in the land for a portion of ownership in the improvements.

It's a nice way for you to monetize the dirt.

Shorter amortization periods can be a real blessing when you're working with a property that produces a strong cash on cash return. The hidden issue, however, is that the shorter your amortization period, the smaller interest deduction you take against your cash flow (including principal reduction), so a shorter amortization period could increase your annual tax liability and reduce your after tax return.

Building's are not required to be brought to an ADA standard when they are bought or sold, rather when you complete a certain amount of work to the property. For example, in Massachusetts, once you spend more than $100,000 in improvements, you are required to make ADA compliant upgrades to the property.

The bigger question, however, is how marketable your second floor walk up space will be to tenants that are looking for ADA compliant space.

There is no substitute for sitting down face to face with a seller to review an offer together. How else are you going to be able to gather information about why they might be selling and how to best structure the deal to get the best price?

If you're in the commercial real estate investing space, you can search recently acquired deals in your market to see who's active. Another great place to look is in the trade journals and press releases for announcements of recent deals.

You'll need some for of down payment to bind the offer. You try for a small amount, but if the deal's as good as you think it is $1,000 should suffice.

Mark,

Congratulations on taking the first steps. One word of caution is that you be careful about playing with your home equity when investing. Not all investments will work out and unless you're comfortable leveraging your primary residence, you might want to look at some alternative ways for raising capital.