All Forum Posts by: Sohail Bas

Your biggest risks are tenant defaults and rent collection issues. Take for example covid times, lots of defaults or people asking for rent abatement.

Also make sure you have a good inspection done. Hidden damages or poor construction can cause issues down the road.

And last but not least any environmental issues can be a big hassle. Check to see if any previous dry cleaners have operated there among many other things. 

Hi there, has anyone ever used the option of Interest Rate SWAPs for lowering their interest rate?

My bank is offering a SWAP rate fixed for 5 years which is about 1 percent lower than their conventional loan for a commercial property.

I've looked at the details but just wanted to see if anyone has personal experience with them, good or bad. Thanks in advance.

One other suggestion would be to create an S-Corp as the holding entity for the LLCs. That way you file one tax return and its less paperwork.

There is not one method to doing this and it mostly depends on how much paperwork you want to do. Sometimes simplicity is the best route. Hope this helps.

This is a tough situation, as is anything that involves family. My suggestion would be to share the responsibility of the tax burden. Since your parents benefited from the sale, a possible solution is to split the capital gains tax burden proportionally.

You could propose a split based on the percentage of down payment vs remaining mortgage paid down over the years. Hope this helps.

Oh man that's crazy to think "we were not taxed enough". Do you mainly have residential tenants or commercial tenants @John McKee?

@Account Closed thank you for the information.

@Bruce Lynn thanks for the info. Yes, we always protest the increases. This year especially in the Dallas market we've noticed the property values have doubled on industrial warehouses.

Hi all, I was wondering as a commercial property owner how to effectively challenge or reduce property tax hikes?

Some of the strategies I've used in the past are:

-comparable sales data nearby

-take pictures to show damage or deteriorating conditions of the property

-show low rental income or conditions if applicable

Any advice would be appreciated. Thanks,

Be mindful of the landlords time. I ask a few questions such as:

-Communication - were they responsive to emails and calls
-Property care - any major issues / did they leave the property in good condition
-Reason for leaving - this would give you more insight if there were issues

And always respect privacy if they are not willing to share. Hope this helps.

A few reasons why similar office / retail spaces are priced differently from my experience.
-Tenant mix - buildings with a good mix of stable, creditworthy tenants will be seen as less risky and could sell for a higher price per sqft.
-Recent renovations - the more modern the interior is and more functional increase its value
-Floor plans - you could have two identical office buildings but one with a better floor plan will sell for higher per sqft.
-Submarket - the specific area in the city will have a big influence. Even if a property is 3 miles away, you will notice price difference if it falls on the other side of the highway for example.
-Visibility - corner locations or offices with prominent signage might attract more buyers.

I would suggest walking the buildings to get a better feel of the properties. Hope this helps.