All Forum Posts by: Kristin Horowitz

Super great input guys, I really appreciate it.

Travis, I had thought about that until yesterday when a friend of mine (and a part time employee of mine with some assets) started asking about the property and conditions and essentially tried to cut me out of the deal entirely because if he had the money, why partner with me. OMG did I panic . . . I guess I gotta keep my ideas to myself. I don't know why anyone would partner with me if they had the money to do it themselves? 

Christopher, Thank you . . . you hit the nail on the head for a lot of the thoughts I've been having about this.  I don't think that my husband and I can feasibly get the money together in the time frame - we simply don't take home enough (ha ha, right, I'm an executive director of a nonprofit).  The flipping idea has occurred to me as a way to make the downpayment on these buildings, but not commercially. Hadn't thought about that. We do have a LOT more experience in that arena than private homes - so why not? I'd think there's a lot more opportunities out there that I'd understand . . . THANK YOU!

So, essentially, it looks like creative financing doesn't live in the commercial real estate market like they say it does for residential and that I'll need to scrounge up over $300,000 somehow to make it happen, whether that's partnering with people to share the return or doing it myself. I got great advice about buying people out over time, etc.

You guys are great, thanks so much.

Time to go out and hustle. :) 

PS, a lot of these questions were asked as if you were evaluating the viability of my business. That's not what I was asking for . . . unless you are personally interested in partnering with me on this, we don't need to evaluate my actual club/gym operation from my perspective, but thank you!

I guess I'm really confused why this is so vague for some of you? Stuff like "climbing gym not mentioned" - it was in the first sentence? I'm sorry if there's not a ton of details, but I think I'm looking at high level solutions vs concrete ones to start - get gears turning, you know? 

I'm currently occupying a space worth $1.4 million as a rental with the non-profit and I'd personally like to buy it and rent it to the nonprofit. My personal assets, as I said, are pretty limited (it took all of them to get the gym successful and running in the last ten years). The next location may be something more like a $4 million acquisition about 4 years down the line if possible so it makes sense to try to figure out a way to buy the existing building first for a few reasons.

Anyway . . . it looks like I got some really good advice. The 401k was a good idea, but as Randy says, not an option for what I'm going for. 

The crowdfunding might be a brilliant idea - a way for EVERYONE to have a personal investment in the next gym without having to worry about the non-profit aspect of it (no one "owns' a nonprofit nor can they take shares.) Since I'm looking to find a way to get an asset in this scenario, things like grants aren't going to work. 

Beyond that . . . I guess my final question would be this one: for my existing property owner with the $1.4 million dollar gym I'm renting, what encourages him to buy vs sell? It was an option but like I said, we had too much pressure to lock down the rent and get the gym going first, my investor friend was pushing me to get a purchase option in the lease but no matter how hard I push my real estate agent to get it handled, he wouldn't. Now that we're in there, I'm not sure what a creative offer to the landlord would be that would entice him. We're a stable business that won't leave for thirty years or more. He stands to make more money off us renting than selling.

Hi guys, here's my story: when I was in my early twenties, my husband and I started a non-profit climbing gym club that's flourished. We decided to expand to a new location and I have spent a year or so reading the forums, doing research, etc, and thought that it would be a good move to BUY the next property instead of lease (as someone with a non-profit, we lose everything if we walk away). We found a property with the help of a friend who is a commercial real estate investor, but the pressure was on to secure the lease rather than work out a deal. After nine months . . . we're finally on the cusp of opening it and the thought of buying it keeps coming up.

Thing is, we JUST bought our first house around the same time. We have no assets. We DO however have some friends who have assets that could help us buy this property (and the next one, too, we're looking to expand in five years to another location), but I feel like the key is in the ask.

What I'd need is the down payment - and while one way to do that would be to sell our house (it's appreciated $100,000k since we moved in thanks to our improvements), but I don't think either of us is ready to make that big step. The mortgage would come from what we're already paying in rent. The business is solid and it's a physical wall so it's not going anywhere. A good investment, but I don't know the best way to approach a potential co-investor or loaner or what have you with a deal that's worth pursuing. One of my mentors has said she'd loan me money to flip houses (because of how well we did with this house), but that's a lot of work and a lot of risk to try to get the money in this particular market. 

I've also never held property before - we just got the house and that's been an education, but commercial can be it's own thing, I'm sure. Benefit there is I've been renting commercial properties for ten years so I think I understand what's needed to keep costs low and profit up . . . but any thoughts you have would be MUCH appreciated.

We've got a 401k and IRA going to take care of us in our old age, but I'd much rather have properties when we retire rather than nothing, you know? We've got solid businesses, why not capitalize on it a la McDonalds?

See, that's what's killing me . . . I can't get any numbers from anyone on what's typical for GRM - I know about rentals and costs in the area and the $.65NNN they're asking for with the lease is there but I can't figure out their pricing other that being verbally told it was $1.2 million. No terms on the lease with step ups or length has been offered - it's insane. This is a commercial development firm and I can't understand why it's so hard.

Thanks for the idea of the buy lunch and upfront, that's what I've wanted to do but I can't figure out if I'm not getting this info because of MY agent, or the other agent. Thank you. I'll keep trying to get to the bottom of it. I'm glad that my instincts that I need this info to move forward are right.

It's NNN. And no, it's not typical - which I thought was interesting about this.

Unfortunately, when we started this, we took on an agent who is a complete novice because I have extensive experience renting these places. When it turned to selling, things got really murky. I asked him to get me an OM and the seller, or his agent, wouldn't supply me with anything. All I know is asking price and square footage. That's partly why it's frustrating. I'm about to walk away from it.

Thanks for the thoughts, guys. My NP would take up the whole space (it's a climbing gym), so that's a non-issue.

It's a little frustrating right now, I can't tell if it's my novice real estate agent or the owners but I cannot get any good information on the space. They told me to just submit an offer. Seems pretty shady, but we'll see.

Hi guys, I've been studying real estate investment for the better part of a year with an eye toward investment in residences, but something funny happened yesterday.

I am expanding a brick and mortar nonprofit business (they exist) and the place we were looking to rent is also offering an option to sell. What pops out of my mouth as we're walking away with a tenant application is . . . do you think the owner's open to a seller finance sale?

The answer is yes.

This is not a cheap sale. Rent on the place is about $8500 a month. It's a $1.2 million dollar sale. The business we're expanding is able to make rent and expenses independent of what happens at the new location (yay cashflow!), so renting it, or us buying it as individuals and then getting rent from our business to pay the mortgage is a pretty solid deal all around.

We ourselves can't back a $1.2 million dollar sale - as an executive director of the non profit moving in there, I make about $70k a year and that's it. We don't have assets equal to the purchase, though I'm closing escrow on my first home (to live in) in two weeks, but even that is only $350k. But, like I said, we're bringing the business we run and I'm 100% confident that if the arrangement works out we'll be able to consistently pay a mortgage out as well as show the seller that to confidence.

But, well, it's not like I've been studying how commercial real estate works. Advice, thoughts? We're either going to lease or buy the place, so help making my offer attractive would be awesome.

So . . . we got the home with a 0% down loan. Deposits on properties not using FHA or USDA are 25% of value, so $100,000. That's why I wanted to do it out of market. I just don't have access to that kind of cash.