SEXY

He predicts the teens will make the great depression look like the good old days.

Just flipping isn't as rampant and being a landlord doesn't make for sexy TV shows, so people bailed out.

IBM,An example of the homes that I purchase for rentals are no more then 35K that will take a couple thousand to make rentalable or I buy HUDs in the low teens to low 20's and put up to 8K in them and rent them out.

It is not the flashy, sexy business that is portrayed on those ridiculous TV "fllipping" shows or on the infomercials.

Because I look so friggin' sexy.

They want it and would like to lease it for us for a 10-yr first option triple net.I have been negotiating with the owner and think we can get the building for $200k and would need to put another $200k into it for improvements to lease.I have not started hard negotiations with leasee (waiting until i get control of building, but will not close until executed lease is in hand) but have casual discussion of $9/sf.So we are looking at cap rates in high teens and a hefty cash flow with paying off the building in 10-yrs.

Its short term, the annualized returns can be well into the teens, and you have the safety of a low LTV secured by a 1st trust deed on a local property.

Yes Tony a TRUE Triple Net the landlord will not pay those costs.Lately net lease companies especially credit rated tenants have been more demanding in trying to get the landlord to cover some costs.It is very important to look at the length of the lease and terms and escalations.With inflation if the rent increases every 5 years is marginal and they want you to take care of certain items with the property it can drastically reduce your returns.It's all about what returns you are seeking versus the security and consistency of the payment.Generally triple net will hover around the 6 to 9 CAP range but will not approach the teens in most situations.For those kind of returns you have to usually chase after value add deals but they are much more work than mail box money from a credit tenant.Credit tenants have risk which is why you also research heavily the health of the tenant today you are acquiring the lease and their growth plans for the future along with reserves.

The deal may not be as sexy though.