All Forum Posts by: Nitin Aery

Thanks @Joel Owens I hear you on the personal guarantee! Out of curiosity, how prevalent is it to see a personal guarantee on NNN retail leases on national chains. I was always leaning towards franchisees that have a larger portfolio (presuming they know what they are doing and higher likelihood of success). I don't recall seeing many personal guarantees.

Another option might be asking to add personal guarantee to an existing lease. Never having engaged in this sort of ask, any thoughts on likelihood or tactics to get it amended?

@Joel Owens thanks for the feedback, it is very much appreciated. The risk of bankruptcy on single LLC is exactly the flag that has prevented me from jumping in with both feet. The return numbers are good enough that if the risk had been minimized I could work on raising the remaining down payment to get to 25-30% down.

The OM that I have seen also says that the leasee is the local LLC and the gaurontor is the corporation.. would that help in your assessment? Having said that the corporation itself is still in this growth mode and showing red for their operations as well.

I did have one lender entertain the possibility of 15% down but we haven't yet gone through evaluation of the deal and company together and no where near underwriting.  They would change 1percent for the load. 

Regards 

Nitin 

Hi..would appreciate any insights into how to evaluate the business of the tenant itself. That is my biggest struggle at the moment for this property. 

Thanks !

Nitin

@Account Closed thanks for your feedback!  Ha! No not looking into any thing related to Marijuana etc :). I suppose I can be more transparent, the industry is more of a hospitality/service type.   But their expansion and business model definitely takes the tech startup model. 

The tenant has partnered with a developer that has built several sites. It seems the developer has carried several properties and is unwinding positions after a couple of years/qtr of operations at several sites. 

Thanks 

Nitin

Hi BP, 

I am in the process of working on my first real estate deal. The property is a commercial retail location with a long term (20 yrs) NNN lease structure. The numbers on the deal are pretty attractive and check off most of my criteria.

Without going into business name or field, The underlying tenant,'s business is a a private corporation that has about 40 locations (each in a separate LLC) across the US and have been expanding over the last several years.

So what's the hold up? :).

Initial glimpses at the financials show that there are losses for the corporation and the locations that are not yet stabilized.  I am looking for advice from the community on how to evaluate the Tenants business and statements for company financial strength/viability.  Things to look out for, questions to ask, any advice pertaining to evaluation of the tenant.  Since the bank/lender Imwill finance from has significant skin in the game, how much credence should be put into their due diligence of the business / deal?

On the lending side of the deal, I am looking to secure a (don't laugh!) 85% LTv loan for 7-10 yrs balloon and 25 yrs amortization. Yes, numbers still work, DSCR is still above 1.5. Any leads on reputable lenders that would pursue this loan?

thanks in advance

Nitin

hi @Chelsie Runnings Nice to meet you!  Will definitely get in touch.  

hi @Pete T. nice to meet you and thanks for the info. I did find the commercial investment forum and some good discussion around the NNN properties that I want to learn about. Talk more soon.

@Henri Meli Congratulations on your purchase!  I just joined BP and this thread was very insightful and inspirational. It looks like there was definitely some serious homework and effort put in place and looks like you were able to get a good deal done!  With the changes in actual rented space etc, I'm curious what was the cap rate you ended up with. Also, were any of the banks willing to go to 20% down?  

Anyway, looks like you are off to a great start .. happy holidays!

Nitin 

Hey there BP!  I'm a newbie to the BP site and Real estate investing in general. Found a ton of great content and discussions already on this site.  As I start my journey and get off the sidelines, I look forward to learning from the experienced and pros out there in this great community.  

Though I have been in "research mode" for some time, it's time to get a move on and take some action. My initial goal is to make some good headway in developing a strong team and network that leads to my goals and objectives for this "adventure". I'm based out of Sonoma County CA and would love to connect up with individuals and professionals. I do have a great Full time career outside Real Estate Investing and plan on using the effort in REI to help with the kids college funds and longer term wealth creation.

My preferred strategy and approach would be to identify, buy and hold commercial properties with NNN structures providing passive income. This may lead to deals outside my county and CA. While there appears to be a ton of conversation on the forums about flipping or rehabbing properties, I did not seem to find much info on the niche I mentioned above. Any links o pointers to such content would be very much appreciated.

Thanks in advance and looking forward to the fun!

Nitin