In this issue

• Increasing Market Value Of The Investment

​Since the value of a rental property is based directly on the cash return, adding value means increasing cash flow. When small investors set out to increase real estate values, the steps are in upgrading houses, duplexes, triplexes, etc., enhancing the cash flow and therefore increasing equity when the property is sold. When working with larger commercial and apartment properties be aware of the things that have the potential of adding value. Do the required homework on the property. A feasibility study can measure the capacity to add value. There may be many other measures that must be taken, such as market analyses, applications for new zoning, design and construction planning and a plan for marketing......(more)

• Building On Leased Land

Building on leased land results in a separate ownership of that building and the land. The two owners, one of the land, and one the improvement, come together in one investment parcel. In this situation, the landowner wants someone to develop the land, but still wants to continue in ownership. The developer prefers to lease rather than buy the property. One owner wants the security of owning the land with a good lease to the owner of the improvement. The owner of the building puts up less money since the ownership of land is not part of the expenses in the development.....(more)

• The Fair Cancellation Clause In A Commercial Lease

Whether a rental market is weak or strong, lease negotiations can be difficult when the landlord wants concessions that are different from the norm. One situation that happens is when the owner of an office building or other commercial property intends to sell when market conditions improve, whether that occurs next year or five years from now. Another is the holder of vacant or underimproved property who plans to develop it whenever market conditions justify. In the meantime, these properties must be leased to generate sufficient cash flow to pay operating costs and debt service. Such an owner will be amenable to giving significant concessions, including a low rental, provided the landlord can cancel the lease during the term....(more)

• How Property Management Makes Asset More Valuable

Management of a building is not just handling problems as they arise and renting units, it is making the asset more valuable to the owner by concentrating on every aspect of the property. Some owners of very large income properties still do not take professional property management seriously and fall behind in values. The professional property manager is keenly aware of all of the recurring costs of a property and how they can affect the bottom line. The owner may applaud and give attention to a one-time saving on a “high-cost” item such as insurance on the property while overlooking the multipliers in the number of units......(more) Click Here For This Months Newsletter

In this issue

• The Investors Leverage With Options

Leverage is the use of borrowed money to control something of value. Real estate investments for many years have afforded the investor some extreme leverage situations. Let’s examine leverage. If double-digit inflation returns, controlling the maximum amount of real estate may be extremely desirable. One way to do that is with an option. High leverage is an excellent benefit. Remember though, that with an option there is a problem. Options have an expiration date. If you haven’t gotten the desired increase in value by the time the option expires, you must make the choice - buy the property and wait longer, or let the option expire......(more)

• How Lease Property Is An Estate For Years

There are real estate investors who specialize in making profits, sometimes big profits from properties that they lease and do not own. This cash flow from a lease can be extremely interesting. Often the lessee making a huge profit has a relatively small cash investment in the property.....(more)

• The Master Plan For Land Acquisition

The acquisition and improvement of land is a large-scale operation and requires large amounts of capital. This has created methods of land acquisition that gives the developer access to and control over a large enough tract to make development economical without requiring an initial outlay of all of the capital necessary to acquire such a tract. From the point of view of the landowner, the disposal of a large tract at a good price may require a formula that will encourage the developer to commit improvement and development money for part of the tract that will build future value into the entire tract. This may be accomplished by the following:.....(more)

• Real Estate Investment Advisors

Today’s investor in real estate must be aware of market conditions and potential that is usually beyond their own available time to attain. Investors need assurance about the true condition of the market. With increased competition, the market place is becoming more complicated. As your professional commercial real estate advisors, we are in the position to represent you in real estate transactions by setting up sales, exchanges, leases, purchase and sales of options, and management of real estate....(more) Click Here For This Months Newsletter

In this issue

• The Success Of A Prospective Tenant

Owners must think about vacancies when checking a prospective tenant. Will the tenant’s business survive? When you have a prospective tenant for a commercial center, you must consider whether that prospect would be a good tenant. There are two key standards to apply; (1) the prospective tenant’s financial stability; and (2) the prospective tenant’s potential for success.....(more)

• Lenders, Property Managers – A Service Joint Venture

Whether times are good or bad, lenders always have foreclosed properties in inventory. During a recession the inventory may be high. One of the problems that banks and insurance companies have is disposing of this real estate owned (REO). They are faced with the decision of whether they wish to dispose of the property immediately or hold it for a period of time to hope for an increase in value. They would like to see the value of the REO increase to equal the loan amount. These lenders are not professional real estate investors but money managers. Therefore, they are reluctant to invest any additional money in the properties. This problem is compounded because a troubled property needs more attention than does a healthy one. It would not have been in foreclosure if it didn’t need help. The solution might be a service joint venture. This type of contract with a real estate firm allows the lender to minimize management fees until the property is generating cash flow again.....(more)

• Rental Market For Senior Lifestyle

Not all retired people want to own their own home. Many prefer to be tenants. Many feel that the proceeds from the sale of their old home can be used to supplement their pension and social security, rather than reinvested in another home. The money can be used for travel, visits to children and grandchildren or for medical expenses. For living quarters, these seniors prefer to be rent payers, not owners. A modest-sized apartment suits their needs and, as tenants, they are relieved of any worries about maintenance and repairs......(more)

• Variations of Commercial Leases

A lease is an integral part of many real estate investments. It should outline all the obligations of the tenant and of the landlord. This sounds simple, but many questions arise. If, for example, property taxes increase, does the tenant pay all of the increase or only part of it? If the property must be modernized, who pays for the improvement? Can the tenant be moved out during the renovation? If the costs of servicing the property rise, should the tenant pay none, all, or part of the increased costs? How should inflation be handled—with automatic rental increases? With increases tied to some index, perhaps the Consumer Price Index?....(more)

Investment Planning

A prospective investor may have a problem getting started with a real estate investment because of the great variety of properties that are out there. They may be fearful that someone will “sell” them something - something that is wrong for them. An answer to these problems can be an interview with an interested professional real estate broker who can act as a real estate investment counselor. Each prospective investor can be interviewed in depth to find out specific needs in an income property. At the same time their needs are being evaluated, the broker will also communicate what benefits are available in various properties and how to identify them. (more)

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In this issue

• Choosing The Right Investment Property

No single property can fit all of the investment goals and rules an investor has set. Even if the investor tried to build a property to specifications, he would find some things “not quite right”. The investor is, therefore, wise to anticipate problems and have some basic strategies for dealing with them. Here are some suggestions to help the investor devise other approaches to meet special needs.....(more)

• Lease Negotiations With A Corporate Team

A few years ago, senior corporate managers were able to make major real estate decisions by themselves. Now, a negotiating team will negotiate leases. This team may consist of legal counsel, finance department representatives, outside specialists such as real estate brokers or tenant representatives, design and engineering consultants, and others. In today’s market, corporate tenants with high credit ratings, who are willing to make long-term lease commitments negotiate from a strong position. Therefore, corporations that formerly treated real estate transactions in a casual way have now developed detailed real estate negotiating strategies. The corporate tenant sees these negotiations as a way to cut costs within the company (whether upsizing or downsizing). Landlords, developers, and brokers must be aware of this new style of negotiation. While the real estate executive plays a key role in developing the strategy, the other parties must be ready to respond quickly to requests for information and be prepared to discuss issues that rarely if ever arose in the past.......(more)

• Drafting The Shopping Center Lease

When leases for shopping centers are being drafted, they can be more difficult than most other commercial leases. In a shopping center, the owner wants the leases to be as uniform as possible, but knows that each lease must have variations to meet the individual tenant’s particular problems in business and in certain size or shaped spaces. Here are some suggestions of items that should be covered in your shopping center leases. There could be many more depending on each property......(more)

• Who Buys Commercial Property

When we represent a seller of a commercial property, we try to determine, as soon as possible in the marketing process, what type of buyer is most likely to be interested in this particular property. We then focus the main appeal on those elements that are most important to that type of buyer.......(more)

• Your Real Estate Investment

Knowing what you can do in some investment situations can be the difference between an annual profit or loss in your currently owned commercial property or the one you intend to acquire. How you acquire it can be important......(more)

• Your Commercial Real Estate Broker

How can I be of service to you? When you are buying or selling a commercial property, of course. At other times, we can handle property management for any properties you might own. Let me help in determining the value of your investment, anytime you need to know. Call my office when you need services of an expert in this community’s real estate. I have the records of all properties for sale at all times. Today’s interest rates, availability of loans, and any other financial information that can affect your property is as close as your phone. Keep our newsletter as a file of useful real estate information and to remind you to call me whenever you need “Professional Service”. (more)

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