All Forum Posts by: Norman Ashworth

Thanks guys, appreciate the advice. You are right, medical buildings are not in that cap range unless they have less than 2 years remaining. I have called on some of them asking the realtor if the client is looking to stay and I have found about a 50-50 split.

My goal is to have leases extended to 5-7 or more years, that way I can take an income and when the properties lease is over the building is paid in full. I can then re-lease them or sell, whatever our life situtations looks like at that time.

Hi,
My wife and I will be relocating to another area of the country and I was looking into commercial property as an income until I get my business up and running. It could be 6-12 months before we have a reasonably steady income, so, I was looking at Commercial Properties, which had a net 9-13% starting point before negotiating. Looking at medical buildings & medical offices but those have a much less starting cap.
I would put enough $$ down so when the lease expires the building would be paid for. If that means 40-50% down that would be doable.
Leases would be written as NNN type and background checks as well. CPI increases, other

I have a five to seven year time frame
what do I need due dilligence on?
normana61

I have a broker, real estate attorney

What do you guys consider a comfortable cap rate with a first purchase ? A small 3-4 unit strip mall , fully leased . recent upgrades and maintenance completed.

Should not need much work going forward but i will have it looked at.

I am looking at a couple, maybe three as cash flow. Do you actually "net" the cap rate ? Or is that just the commercial realtors pitch !!

appreciate your knowledge,
normana61

Need analysis on this property. Salon plus 3 apartments.

Income Salon : 19,732.00
Income Apartments 12,300.00 ( 3 rented ) range from 300 to 425

total income 32032.00

expenses : utilities 6369.00
garbage 600.00
supplies 1800.00
tele 1000.00
taxes 4200.00
insur 5000.00
mntge & cleaning 2640.00
------------------------------------
total expense 21609.00

property is 75K , roof over 20 years old, one additional apartment not rented needs 6-10K rehab. ( was never rented more like a large storage area which can be made into a 1bed, 1 bath) air condenser in salon new last year, plumbing, electrical all as old as property 40+ years, has termites 5K for removal

It now has 11K net profit

my feelings is if I get the utilities (water, elec, tele ) paid by tennants and salon. that would be additional 7K in income. rehab the additional apartment to generate 4K, treat termite infestation

11K + 7K + 4K = 22K net

What range would you be a buyer in ? 60K , 65K or nothing

Thanks guys, great advice here
normana61

OP back,

I am going ot look at two properties , side by side, fourplex's rented furnished at 750. a month, 36K income ( so the 50% rule would net me close to 18K )

they just dropped to 185K ea.

properties built in 77 so i am sure allot needs to be done to these....the main question is why is he / she selling ?

thanks for everyone's help.

normana61

Original Poster

Hi P NW,

I am looking at both , in-expensive ones and ones in better areas. When pricing properties of these types do you consider ($ per sq. ft ) I know more goes into it than that, such as outside/inside condition, repairs, future repairs, etc. But they range from 21.00 per ft to 69.00 per ft. ( the 69.00 was built in 1996 )

I was not thinking that only 50% would be left. But maybe just wishful thinking or lack of knowledge to better put it on my part.

and wishful thinking does not put $$ in my pocket, that is why I am here asking questions.

As far as my house and condo, i own those outright and nevered leased or rented them, that is why I need a property mngr on board as well. If I go down this road.

Jury still out... still weighing all options

thanks for all responses, extremely helpful guys
normana61

HI,

My wife and I will be locating to SW FL in the near future and was wondering about real estate income.

We will need income , now & latter so we are looking into duplex's, tri-plex, etc. for a income going forward. We would be 80% cash buyers but still would take a small amount of mortgage that would be paid off in 2-3 years.

We own a home & condo , no debt. We have never had rentals so we would start with a property mngr.

Is this a pipe dream or something that can be done......If it can be done what are my concerns & nightmares going forward.

thanks for your time,
normana61