All Forum Posts by: Joshua Watts

@Alina Trigub

The strip center is mostly empty. As for your question on "As for solving" I not 100% sure what you are asking but I will give it a try. I am redeveloping the strip center as a climate control facility. I hope that helps....... 

Check out my new post if you would like it is the strip center redevelopment.

Everyone wants to know about the money so here goes. I bought the project for $475,000 and have a construction budget of $500,000.00. I am thinking after phase one that I will have right at 1 million in the project. Of course the bank had an appraisal assuming that the construction was complete and the appraisal came in at 1.4 million. My down payment was other real estate worth around $550,000 with debt on that property of $110,000.00. The new loan is right at $1,110,000.00 so at closing I got a check for $500,000.00 for my construction budget. We starting gutting the inside of the building today here is a picture.

Luck have it the family called back to ask me what I would be willing to pay for the property. Over the next couple weeks we ended up agreeing on $475,000.00. We sign I contract and I paid them $10,000.00 earnest money. The contract had three ways out for me. 1st way out was contingent upon bank financing, 2nd was the city giving me proper zoning for self storage, and 3rd was me performing a building inspection. It took 6 months to close but as of 1-28-19 I am now the owner. A couple of things that someone might learn, was when you go to the zoning board have an architect draw you up a few pictures. A picture is worth a 1000 words. Below is my pictures I had for the zoning board. Also wait as long as you can to tell the seller the outcome of the building inspection that way you have more leverage if you find something and ask for concessions.

One of my local grocery stores closed down leaving the strip center almost vacant. After a few months the family that own the building put out signs for lease. I own a real estate holding business that largely invested in self storage. (We also invest in single family up to small apartments) We own some facilities in the area yet they stay fairly full. (We also own facilities out of town) I cold called the family from the number right off the sign. I asked if they had interest in selling and they said they really wanted to rent for now but they would sell for 1 million dollars!!! (its funny everyone wants 1 million) I said sorry that was way out of my price range but if they needed any real estate advice or had questions to call me. I was guessing that I would never hear from them again but I wanted to leave the door open.

Investment Info:

commercial investment investment.

Purchase price: $475,000
Cash invested: $1

Complete redevelopment of strip center to climate control facility.

What made you interested in investing in this type of deal?

I believe a real estate investor needs to specialize. We specialize in single family up to small apartment building and self storage.

How did you find this deal and how did you negotiate it?

Cold call

How did you finance this deal?

We pledged other real estate owned for the down payment.

How did you add value to the deal?

Redevelopment of property

What was the outcome?

In process of redevelopment.

Lessons learned? Challenges?

So far befriend the owner and stay in touch. I am sure I will learn more when this get done.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

No

Investment Info:

commercial investment investment.

Purchase price: $475,000
Cash invested: $1

One of my local grocery stores closed down leaving the strip center almost vacant. After a few months the family that own the building put out signs for lease. I own a real estate holding business that largely invested in self storage. (We also invest in single family up to small apartments) We own some facilities in the area yet they stay fairly full. (We also own facilities out of town) I cold called the family from the number right off the sign. I asked if they had interest in selling and they said they really wanted to rent for now but they would sell for 1 million dollars!!! (its funny everyone wants 1 million) I said sorry that was way out of my price range but if they needed any real estate advice or had questions to call me. I was guessing that I would never hear from them again but I wanted to leave the door open.
Luck have it they called back a week latter and asked what I was willing to pay for the strip center that is when I said we are so far off and I did not want to piss you off. After they said they would not get mad I told them that the building was worth about half what they were asking but I would have to look at the building before I gave them a hard offer. I also told them how to get there property taxes reduced because they lost there renter and the county is over valuing there buildings. They did what I said and saved a lot of money and then I think they liked me.. To be continued.....

What made you interested in investing in this type of deal?

I believe a real estate investor needs to specialize. We specialize in single family up to small apartment building and self storage.

How did you find this deal and how did you negotiate it?

Cold call

How did you finance this deal?

We pledged other real estate owned for the down payment.

How did you add value to the deal?

Redevelopment of property

What was the outcome?

In process of redevelopment.

Lessons learned? Challenges?

So far befriend the owner and stay in touch. I am sure I will learn more when this get done.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

No

@Alina Trigub

This was a cold call. I going to start a post on the strip center in the next coming days. Ask any question I am going to give all the details. good or bad

@Farzan Setayesh

Seens like a lot of people want to hear about the strip center so I am going to start a new post. I think I will answer all your above questions but feel free it ask if I miss one. I did have to get a zoning change and they pulled out some of the HVAC.

@Andreu Ferragut

Your question was "How much do you charge per unit? And how do you compete against other franchises (like CubeSmart) if they are present in your area?".

As for how much I charge per self storage it depends on the size. The smaller the unit and more money you can get from it per foot. In my area I can get a little over a $1 per square foot for say a 5*10 and about half that for a large unit at about .50 cents for a 10*20..

The self storage in this post that I am talking about does not have any of the big franchises in it. I do have other self storage facilities that my competition is the big guys. I worry about the mom and pops' more so than the big guys. The big guys will not come in and cut the hell out of the pricing or keep rates low like a mom and pops' that has there building paid off and never increases the rates. (Like the one I bought) Sometimes the mom and pop are just happy to get the rents that they can to make a living and hurts other by not pushing their rates. Yet they don't know they are hurting them self and others on pricing.