All Forum Posts by: Matt Hubbard

These are both good points, thank you. That gives me hope. We have bought and sold many houses, but this is our first commercial purchase.  I think we are going to have to put together a road show and visit a whole bunch of banks. I might even talk to a hard money lender as well. 

Thanks all. 

@Greg Dickerson Thanks for the reply. Doesn't the SBA also guarantee the loan?  Why wouldn't that be the benefit of the extra paperwork? 

And yes, we have all the tax refunds, P&L, etc. We make sure all the numbers are there and accurate. 

A bit of history: My wife and I purchased a failing furniture store from a retiring couple 3 years ago. 

• Year 1: lost $80k took no salary
• Year 2: lost $30k took $5k salary
• Year 3: Break even took $80k salary... and that's through a pandemic & being locked down for 8 weeks. 

We have been investing heavily in growth and it has been paying off: We are currently running at 100% year over year revenues. 

There is a building we would like to purchase for right around $2 million including construction costs. It comes with 1 under market tenant, but the other 60% would be our store. We are currently paying $10k in rent(and CAM) and we think the monthly payment would come out to $11k net. 

We are looking at SBA financing, but the banker it telling us we need years of profitability. Something doesn't seem right. So I am reaching out to the financially knowledgeable in Bigger Pockets! How can we get this deal done? Could we BRRR it? Are there other financing sources we aren't looking at? Or can you explain to us what the problems are? Because if we can't purchase a building, I'm not sure how anyone could.

Other data points: 

• The business bank account has $300k in it. 
• We are generating $5-10k free cash flow a month, starting in October
• We have a SBA 7a loan we used the to purchase the business, and there is enough cash to pay it off.
• As owners we have $1 million portfolio of stocks, and paid off house. 
• The building would require a sizable construction loan: $300k, but it's a super upgrade from our current location. 

Please bring me all your best bad ideas!  

Thanks in advance. 

I would comment more, but Nick assigned quite the homework list. (all good, though)

Yes I'm new to the Real Estate game, other than my own home of course.  The Wife and I purchased a business 3 years ago, and now we are looking at getting into real estate.  Specifically commercial. Specifically retail... to support our retail store. 

Seems Denver doesn't have a very active forum, so reach out if you are in the area.