All Forum Posts by: Siedda Herbert

Hello, 

The goal hasn't changed, but the approach I is different. My focus for the first quarter is wholesale transactions. 

Hello BP Family,

I need your help. I was presented with a potential deal by an investor friend. I have been doing residential real estate for a year, but this is a commercial lead.

He wants to sale his commercial land that has (3) buildings on it. Buildings are 3,000 sq ft ($1600 rent), 700 sq ft ($700 rent) and 600 sq ft ($600 rent). Tenants are responsible for all utilities. No cam fee is charged. The only building currently leased out is the 600sq ft building. The 700 sq ft building has a different tenant every few months. The 3000 sq ft building hasn't had a tenant in a year. He owns the land and buildings out right (free and clear). He is open to seller finance, but he didn't want to give me a number for a down payment. I wouldn't considered him a motivated seller, but he is willing to working something out.

The land is in a very prime location, on a main highway in Baton Rouge. Walmart, Smoothie King, Subway, Banks, AT&T are all 2-3 blocks from this property. The seller is asking $575k for the land and (3) buildings. $550k for land $25k for buildings. He said another investor friend in the area told him he sold his land for that price.

I pulled the recent sales from the Clerk of Coutt Office and majority of the recent sales sold between $1-$5 per sq foot. My investor friend is asking $10 per sq foot

I spoke with a commercial banker/investor, and he said he can fund 60% of funds for demolition and to build a new infrastructure on the land. He suggested 4 suites (shopping center/strip mall) which would cost $35 a sq ft (not sure if this price is good or bad) to build. He suggested that If I find a way to get the seller to owner finance the land, I could be in with little funds out of my pocket. I would get the seller to do profit participation based on the new infrastructure that's built.

I am unsure of how to structure this proposal. How do I go about educating the seller that $10/sq foot is tooooo high. Should I show him the recent sales from the Clerk of Court office if he rejects my proposal? How do I determine what to do with the land/existing structures since it is underperforming right now? How do I put together a proposal without offending him, but it be a win/win for everyone?

My vision was to knock the buildings down and build something new. It's a great location for commercial suites, CVS, or fast food restaurant. I do not want my name or face associate with the project, so I was thinking I could build suites then lease option or sale it to someone else.

Any and all help would be greatly appreciated. I had a realtor friend helping me, but little to no movement has been done. 

Hello @Janice Davis , 

Welcome to the BP family. There are severs great resources on this website. Best thing about  this site,  everyone has the same mission and love to help. If you're always on the go, like me, take advantage of  the podcast app. I listen to the BiggerPockets Podcast as I drive to work and other destinations. If I can assist in any way, I would be more than glad to. 

Hello BP Family, 

I need your help. I was presented with a potential deal by an investor friend. I have been doing residential real estate for a year, but this is a commercial lead. 

He wants to sale his commercial land that has (3) buildings on it. Buildings are 3,000 sq ft ($1600 rent), 700 sq ft ($700 rent) and 600 sq ft ($600 rent). Tenants are responsible for all utilities. No cam fee is charged. The only building currently leased out is the 600sq ft building. The 700 sq ft building has a different tenant every few months. The 3000 sq ft building hasn't had a  tenant in a year. He owns the land and buildings out right (free and clear). He is open to seller finance, but he didn't want to give me a number for a down payment. 

The land is in a very prime location, on a main highway in Baton Rouge. Walmart, Smoothie King, Subway, Banks, AT&T are all  2-3 blocks from this property. The seller is asking $575k for the land and (3) buildings. $550k for land $25k for buildings. He said another investor friend in the area told him he sold his land for that price. 

I pulled the recent sales from the Clerk of Coutt Office and majority of the recent sales sold between $1-$5 per sq foot. My investor friend is asking $10 per sq foot

I spoke with a commercial banker/investor, and he said he can fund 60% of funds for demolition and  to build a new infrastructure on the land. He suggested 4 suites which would cost $35 a sq ft (not sure if this price is good or bad) to build. He suggested that If I find a way to get the seller to owner  finance the land, I could be in with little funds out of my pocket. I would get the seller to do profit participation based on the new infrastructure that's built.  

I am unsure of how to structure this proposal. How do I go about educating the seller that $10/sq foot is tooooo high. Should I show him the recent sales from the Clerk of Court office if he rejects my proposal?  How do I determine what to do with the land/existing structures since it is underperforming right now? How do I put together a proposal without offending him, but it be a win/win for everyone? 

My vision was to knock the buildings down and build something new. It's a great location for commercial suites, CVS, or fast food restaurant. I do not want my name or face associate with the project, so I was thinking I could build suites then lease purchase or sale it to someone else. 

Any and all help would be greatly appreciated. I had a realtor friend helping me, but little to no movement has been done. 

@Kevin Jackson Duplexes that are close to market value ("expensive") usually have minimum repairs, are in a great area, 100% occupied, great cash flow. A $30k duplex will most likely need repairs. Depending on the repairs, the $30k duplex could possiblly be a $100k duplex once repairs are finished.  

Hello, how exciting!! I am at the same point. Shoot me your email address, and I can forward you the contacts I have for insurance agents. Have you ever visited the BR REIA meetings?

@Justin Fox just realized this was written 10 months ago. Sorry. How did this deal go? 

@Stuart Birdsong I agree. If this person is willing to consider lending you money, that's awesome. He's someone you want to keep around. He may become  a lifetime investor for you, so you definitely want to take care of him. Even if you try it his way this one  time, but don't make it a habit to do all the deals this way. Since he wants a percentage of the rent, I would just include 8-10% for him as part of your operating expenses.  I wouldn't get a property manager. I would just give him that $8-10% and manage the property myself. Now, it would be your decision if you wanted to state in the contract that he's cut off after (X) amount of years. I honestly would  just ask him "why" does he want to do it like this. Of course it's beneficial to him, but it may not be beneficial to your. That's why you don't want to do every deal like this with him. Hope this helps 

@Bill Wicker Thanks for your help. Is there anyone in particular I should ask for? 

Good Morning BP Members,

I need your help. Next week, I will be interviewing real estate professionals to see who would be a good fit for my real estate development company. I am seeking a contractor, closing attorney, small business attorney, CPA, and wholesalers. Any referrals would be greatly appreciate. Thanks for all of your help and support.