What Do You Own?

[BrandonModrov]

I have always been interested in commercial real estate. I am a wholesaler as you may or may not know and I have only wholesaled residential properties.

I might start looking into wholesaling commercial property in the future but this really isn't my question.

I would like to start building a portfolio of properties including commercial.

So if you dont mind.....
What type of commercial properties do you own?
How did you obtain financing for them?
How did you find your commercial properties?

If there is anything else you would like share I would greatly appreciate it.

Thanks,
Brandon

[SPIVALAW]

Personally I have found Commercial to be pretty easy.

The only difference is commercial is often limited in use, in other words a building occupied by a Vet clinic may be limited on who the next tenant is.
A house can be rented to many different families.

Commercial stays vacant longer. But tends to appreciate in value much faster.

I love the NNN of tenant paying taxes and Ins. and repairs.
They want their business looking nice and have weekly lawn care.

Most businesses who are running ads and paying phone books, etc prefer to stay put for a long time.
Many tenants in commercial will happily paint and improve while residential tenants usually don't.

Laws that strongly favor family tenants aren't helpful to business tenants. Businesses are easy to charge late fees and evict.

The last couple of commercial properties that I have bought have owner financing!!

On larger deals banks fall all over themselves offering financing, even non-recourse financing (no personal liability).

[thepower]

Howard, Can you go into detail your valuation process for commercial real estate?

Speaking of appreciation, Since commercial property is mosting valuated by the income, beside improvements, is increasing lease rates the main way for appreciation since the market comparison method cant be used effectively?

Thanks

[SPIVALAW]

Well if I paid $1.5M and people are offering me $2.5M who cares about rents?

[ThreeRiversREI]

Speaking of appreciation, Since commercial property is mosting valuated by the income, beside improvements, is increasing lease rates the main way for appreciation since the market comparison method cant be used effectively?

On a related note, how do you determine an appropriate multiple to value the property?