All Forum Posts by: Tony F.

Look at smartvents for wet flood proofing, put garage downstairs and wet flood proof it, living space up above flood level. Or fill the site. Not hard but not cheap.

@Ashish Acharya

So we pay tax on the fmv of the asset as it’s phased out as a distribution/ordinary income

@Ashish Acharya

Reading about a 5year phase out when changing election from C Corp to S Corp. once it’s an S Corp it’s a pass through entity.

Lmk if I’m missing anything. Would be signing up for a 5year hold and potential liability of a c Corp stock sale and any dirty laundry associated.

https://www.noglaw.com/tax-benefits-converting-c-corporation-s-corporation/

Found an off market property in up and coming area. Owners are open to selling, but just came out that the property is owned by their corporation.

Their CPA says they will pay cap gains when the Corp sells, then they will pay income tax on the distribution, resulting it over 50% of sale proceeds going to Uncle Sam. Property is fully depreciated with a very low original purchase price, so high gain.

They want to sell the corporation to avoid this and only pay the cap gains, my attorney says no way (liability from unknowns, and we deal with the same when we want to sell)..

There must be a way to navigate this and only sell the asset??? Please advise. Thanks

Curious what multifamily in the $2-4m range in and around Phoenix are trading at currently.

To be more specific, property listed on MLS, closing price cape rate, not renovated and flipped by a bigger pockets investor… operational, not brand new, and not 60s era finishes..

Thanks!

@Carolina Galindo

I invest (buy, permit, sometimes develop, sell) in cannabis real estate very frequently in Humboldt county, pretty familiar with the rest of the state. Lmk specifics and I can help I’m sure.

Pursuing a brownfield subdivision, that seller is willing to maintain the contaminated portion of the parcel through a subdivision. Seller wants me to handle the subdivision. Local municipality is on board, but wants a bond put up for the improvements before recording the subdivision map.

I’m on board to pay for consultants/engineers to get the subdivision to hearing, but don’t want to be on the hook for an expensive bond if the seller could sabotage escrow after I up the property value (by creating a clean parcel).

Question is... if I get subdivision approved, can escrow handle releasing the bond to local municipality and recording the subdivision, getting apn for new parcel and transferring new parcel to me?

Not sure if this is standard practice for escrow, but seems like a fiduciary of some sort needs to be involved to protect all parties?

Thanks

@Derek Wissner

Lots of risk and upside. Unless feds pass a safe banking act you will be handcuffed to private money funding (there is talk of this progressing which will be huge for the industry, not only for RE side but for operators who have to currently fund everything, no line of credit against ARs is a big squeeze on operations which trickles down to the landlord) if you have a current mortgage in place you will be likely be at risk of having your note called (doesn’t always happen, but is a risk).

These businesses are started heavily on speculation, not as much profit actually being made as expected in the industry, but lots of investment money has proped it up for last few years.

Rents and RE sales in California are 3x priced over non cannabis tenants. The industry demand is unquestionable, eventually consolidation and commoditization will come and the strong will survive and profit. Pick the right tenant.. easier said then done.

@Lucy Can

Probably higher then that, but would depend on future other uses. Cannabis businesses in general should have very poor credit rating, loads of defaults and failures. Private financing is the only way to get these done, but should be easy to find as others have said.

@Christopher Brown

Are you allowed to re-Id new properties if you original 45day selections falls through?