All Forum Posts by: Jonathan Orr

@Account Closed I have a friend who has partnered with a few different REITS for his projects.  From what he has told me, the only issue he has had with them is that some have extensive due diligence processes which could potentially be frustrating of getting approval from them to fund.  I guess it would be deal specific of when they are coming into a deal.  However, could not think of a potentially better partner if they like your project since it is fellow real estate minded people.

Would love to find out more info as well.  Seems very interesting.

@Justinian Lane Everyone has provided great insight.  I will say that when it comes to development, talk with developers.  They will give you their focus and the good ones will give you the feedback of the good, bad and ugly with their respective real estate development focuses.  That may turn into a partnership or a mentor.  If you are interested in Commercial Development, one book that I really enjoy is not much of a "teaching" book but gives a good idea of how developers think is "The Real Estate Game" by William Poorvu.  Great book of some of the mindsets and how he looks at projects.

On a side note, great areas to target. I myself am looking for a few ground up development deals in Austin and Phoenix

@Tyler Brown the 1031 agent is correct. Experienced a similar thing a few years ago. If it is 1031 exchange funds they can't co-mingle with other monies, which would be the reason for the TIC. A syndication attorney can confirm this. (this is just my opinion and experience)

@Bradford Ortlund personally have done 99cents only store. Know a big retail developer who does ground leases. He informed me Jack in the box, Starbucks, Dunkin, McDonald’s, el pollo loco are retailers that are open to them. Most QSR will take a look at ground leases

@Stefen Romero everyone is correct with educating yourself.  Just remember, it is your money and your decision on what to invest in or not.  I would look around and make the determination on a few things before ever talking to anyone

1)How long are you comfortable keeping your money out? (3 months vs 3 years)

2)Do you want to partner or do things on your own?

3)Think about geography and where you would want to invest (personal example, I am looking out of state because there are better opportunities)

4)What type of real estate interest you (would recommend talking with several different professionals in different asset classes ex: retail, housing rentals, development, etc...)

Once you get a little better idea from thinking of those things, you can tailor and search for what interest you and who you may want to talk to.

Welcome to BP and best of luck to you!

Most CCR's are lengthy to go into great detail with regard to restrictions of tenants and uses. Always a joy to read ;).

@Account Closed most large developers who are vertically integrated have a PM arm.  That allows them to fully control the property and give them the ability to charge for property management services.

I have never heard of a developer selling an out parcel or a part of their center and requiring that they remain the property manager. That is a question for a real estate attorney, or ask the listing broker to clarify if the CCR's state that and if there is any way around that (sale, bankruptcy, etc...).

I recently consulted for a client on a property in a similar situation (shadow building of a larger center) and was able to bring in  3rd party management, was a new center and they gave us the option to have them manage or bring in our own management. I would be very cautious if they don't allow you to bring in your management.

@Michael Wayne A feasibility study is going to answer a lot of questions as to if the market could potentially support a new MF development.  They wont give you exact answers as too cost or specs but will give you a generic understanding.

Before that, I would personally start with the city.  Go see what the zoning is and if you will need to get a zoning change or a variance potentially.  They will be able to tell you about densities based on the zoning and what general rules you will have to follow.  At the same time, brokers that focus in Multifamily complex investments would be a great tool (if you can get them to talk to you) to get rent numbers and vacancies.  

Start collecting numbers for a underwriting to see if it is viable, if it is based on numbers. That is the point I would get a feasibility study done (can run you several thousand dollars for a good independent study), then you can focus on hiring people such as architects to make your vision real.

@Doug Smith @Jeff S.

I appreciate the tips.  It is a small lender. After all paperwork is done, we are going to be "making friends" with the 1st to make sure we are in the know.  As for the Title search, it has been done and we have confirmed that we are truly the 2nd position. Since this is a settlement of a lawsuit the attorneys have confirmed we are not going to be triggering anything.  We will have to see if the borrower keeps up with the mortgage or not (That is a whole different conversation).

Thank you again!

@Richard Talbot are you talking about a complete tear down and rebuild?  If so, I put alot of trust in my architects and design team.  Additionally, with any development, you have to play by the rules of the city (which can be a good or bad thing).  I would say that unless its a massive complex in a metro area, using common sense like attached garages or potentially having an elevator would always be a good addition (assuming that you can recoup those added cost).  Now a days I see a lot of smaller developments that go over the top with the amenities because they feel that that is a big driver for tenants and boosting rents.  Sometimes that is true and sometimes they just overbuild.  Really need to know your prospective client on what they care about and are looking for.  I would say letting your experienced architect/designer run lead on that is the best scenario for you.