All Forum Posts by: Matthew Drouin

@Kody Smith

You mentioned syndication.  With your balance sheet and cash, you can put together creative deals without giving up equity and without using your cash but you are going to need to find a market and product which has 7-8% cap rates.

I invest in the northeast, Great Lakes area.

Diverse economies with education, healthcare as the back bone and tech as growth.

In your area, you'll have to raise way more capital in the form of equity just to meet DSCR with the banks.

@Jay Hinrichs thus why I relate to boomers so well lol

Retail strip and lifestyle centers are doing well.  But the shopping centers, most all of them have defaulted on their loans in our area.  What's really interesting is to see some of them being redeveloped into housing for seniors.

Also shopping patterns have changed with work flexibility, so many of these malls don't need as big of parking lots that they once did when people could only shop after work or on weekends.  So developers are building multifamily on these parking areas.

Since these areas aren't located on top of residential areas, the zoning approval process has a lot less friction and resistance from NIMBYs.

Here's an example in Rochester where an old Sears was turned into apartments for seniors.

https://www.passero.com/projects/skyview-park-senior-housing...

For multifamily developers, this could be an opportunity for building and partner with the mall owners.

Small wine town is all I needed to hear.

Seasonal tourism is usually not a great industry in which to build a sustainable business.

There are probably higher and better uses of your capital near high velocity metro areas.

We have small wine towns near our city in the finger lakes region of western NY.  And there’s no catalytic economic drivers for those areas.

Don’t do it unless you are doing it just for fun and pure speculation.  Which is fine.  Just make sure your expectations are there!

@Eva Sha happy to spend an hour with you over zoom and see what type of guidance or direction I can give you.  I made the transition to commercial about 8 years ago and happy to lend my insight

@Alexander Zeisberg we would contact the DMV.  When a Lien is recorded it goes onto the physical title.  It's been a while so the details are fuzzy in my mind.  But I would contact the owner of the park (assuming you're not buying the unit from them) and ask them.  They have something at state if things aren't done properly.

@Ibrahim Mawri my main concern is on exit strategy. Commercial properties owned in an HOA tend to have issues with financing. You'll want to make sure multiple banks look at the deal to see general appetite for financing.

What happened to us is we took over a string of condos from a non bank lender that foreclosed on the properties.  It was very difficult for us to find a bank to refinance the deal and also difficult for us to procure a buyer for the condos we didn't want.

The cap rates typically traded higher than a simple ownership interest.  The only thing that saved us is that we bought them cheap but our exit price was not nearly in line with what we thought we would get.

@Ethan Anderson a commercial appraiser can give a valuation on an easement.  We just bought an easement from the City Of Rochester and they hired an appraiser to give a third party valuation.  The other thing you want to consider is not just the monetary value of the easement but the opportunity cost associated with giving up those rights and if it encumber the value of the rest of the property!

@Alexander Zeisberg do title companies handle the transfer of title of MH in your state?  I used to manage a few MH communities in Michigan and oversaw transferring of titles when our residents sold their homes.  As long as there wasn't a lien recorded on the physical title itself then there wasn't an issue.  But I'm not familiar if title could get clouded from another mechanism at the state DMV for instance

@Terrance Coleman congratulations, you are officially now part of the 6% club.  Did you know 94% of Americans don't own a single investment property?  Give yourself a pat on the back.  This experience will a tremendous value to you and your investing career!