All Forum Posts by: Paul Cattin

Are you buying the restaurant or real estate with restaurant as a tenant? If the latter, I would ask for a rent roll and/or lease to understand you annual income after all expenses (NOI). If it is vacant, you will want to look at the value in the building vs the land and find similar comps in those regards. Happy to answer further when if I can understand the remainder of the story.

@Courtney Duong it can depend how the listing agreement is written. Regardless, you would only pay on the initial Term, not the renewal options. Which, you can dictate in the agreement.  It's my opinion that a tenant should be entitled to some representation if the lease is being altered or changed in any way at the renewal. This could simply mean a rate adjustment. That said, as a landlord, you can certainly draw a line in the sand and cross that bridge when you get there. However, I would not risk losing a tenant over debating a fee to their broker 'if' they have one at renewal. 

I highly recommend hiring a broker. They will help market, negotiate and sell the space. 5% direct or 6% coop fee would be your cost, which should be far less than any vacancy cost in addition to your time. While I am not familiar with your market, this is something that won't cost you anything out of pocket until the deal gets done. In Milwaukee, I would assume you have a few groups that you could discuss with to see who will be the best fit for your property. 

Hello Kane,

My recommendation would be to surround yourself with others that you can learn from to decided which product type is best for you. The direction I took was to actually get my RE license and focus on investment sales for retail and office. You can earn a living and learn on the job. You can go to school for real estate as well. Buying one at a time, you can eventually switch over to being a full time landlord. My two cents. Best of luck. 

@Nathan Gesner brings up some good points. That said, your cap rate is closer to 9.6%, if the income is a true NOI, which is great if those are NNN leases and you aren't going to have significant roll over anytime soon. Personally, it sounds priced to sell and feels like you should look at the rent roll and P&L closer to understand the lease structures better before making any decisions. You may also want to understand the market rental rates. That could indicate some value add or even false hopes should the rates have TI amortized in them.

Unfortunately, yes. You could use Loopnet, which is owned by CoStar, but that way you won't have to pay the membership dues. That said, you won't see everything that's available through CoStar. Personally, for the best interest of your client, I would recommend finding a commercial broker that you could introduce your client to that would pay you a referral. They're different animals and probably where your time is best spent. 

Most likely not. Tenants would pay their pro rata share of the expenses regardless. Any vacancy would add this cost to operating. 

What are you selling? In my opinion, most buyers that see that a building is for sale and that the leases are all NNN sells itself. However, even if leases are MG or FSG, most sophisticated buyers will be able to underwrite appropriately.

Hello Jen,

You can certainly write an offer by yourself. What state are you in? I may know someone in your area. You should be able to find a state specific purchase contract for a commercial property that will cover the general terms. That said, I do recommend having a broker represent you and do this for you as able. Most of the time, you will not pay their fee as it will be covered by the seller if it is listed. They can confirm that with the other broker for their split.

Also, if you are ready to move on it, this should be pretty easy for a broker to take the time to write an offer with any of your contingencies. Hope this helps. Paul 

@Gary Gristick sorry for delay, I didn't see your response. No, you do not. However, you would pay taxes on what you do not exchange. Therefore, the delta of $300k would be taxed. Hope this helps... in time.