In this issue

• Physical Inspection Of Investment Property

When a buyer makes an offer on an investment property, it is usually only after a thorough inspection of all of the data that is available on the financial records of the building. The physical inspection of the property could be as important or more important than the rents and expenses. Some investors pay more attention to the data than the structure. With a physical inspection on the potential investment property, a buyer may be able to:....(more)

• The Commercial Condo

Statistics show business and professional firms are buying offices rather than leasing. While buying or constructing an entire building is an option for major corporations or for smaller firms outside metropolitan areas, owning commercial space generally means being part of a condominium structure.........(more)

• Property Values Around A New Hospital

What happens to nearby property values when a new hospital is built? Usually the surrounding area feels a ripple effect. No matter how old the buildings that surround a new hospital complex are, land values increase. Developers are quick to provide new space for offices and stores. The biggest profits are realized by the investors who get involved early (during the planning stages) before or while the hospital is being built. As a new hospital is being built, the surrounding area around it will began to improve by demolishing older building and revamping existing buildings to create ancillary businesses. Among the new activities that create an abnormal demand on land located near the hospital are:....(more)

• The Protection Of Confidential Information

Typically, a landlord has access to leased premises at all times for purposes of making repairs and inspections. But in today’s information age, many tenants have valuable trade secrets, confidential information, and unique documentation in tapes, CDs, DVDs, listings, and other intellectual property that should not be accessible to the landlord. A software company tenant, for example, should try to obtain the right in the lease to maintain locked documentation rooms where even the landlord’s janitorial and maintenance people have no access and the landlord is given no copies of keys, pass cards, or cipher lock combinations to the additional locks installed by the tenant on the documentation room door.....(more)

• How To Find Commercial Tenants

At all times, good or bad, we must aggressively search for replacement tenants. A month’s rent from a vacant unit can never be recovered. Just running expensive advertising for this space can be nonproductive. A better way might be to have a professional management company that keeps all local brokers who specialize in leasing informed of the advantages and amenities of the building. Here are some other ideas:.....(more)

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In this issue

• The Versatile Real Estate Option

​An option on real estate is an extremely versatile investment tool that comes in a variety of forms that can be used for a variety of purposes. The primary use of the option is that it gives the optionee (the party holding the option) control over property (in the sense of the right to buy it) for very little cash. It gives the most leverage and conserves cash, both very desirable for investors. An option gives the holder the right to buy a specific parcel of real estate at a specified price, on specified terms within a specified period...(more)

• Percentage Lease And The Seasonal Business

The choice of the type of lease for commercial space leased by a retail business is usually a percentage lease, meaning that the rental amount is determined as a percentage of the gross receipts of the business. The investor-landlord, in effect, takes a stake in the success of the tenant’s business and shares its ups and downs...(more)

• Condos – Developments And Conversions

Most anything that can be subdivided to be sold or rented can be developed or converted to condominiums. When we say “condo” maybe the apartment might come to mind first. Then, you may think of the commercial office building that was converted to condominium offices...(more)

• Changes In Shopping Centers

Shopping centers have been changing. Increased spending power in the population is supporting new mall construction and the renovation of existing centers. Now the newer and renovated centers are becoming more mixed use, with hotels and office buildings being incorporated into the plans. Larger malls are providing more than just shopping. We are seeing more cultural attractions, medical clinics, health clubs, spas, and other facilities locating there....(more)

• Owners And Tenants Must Have Insurance

Insurance coverage must be addressed by both landlords and commercial tenants. For the run-of-the-mill daily problems, a landlord must have the maximum coverage for the building and the tenant’s leases. The tenant must cover the business with coverage that will protect his business.....(more)

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In this issue

• Commercial Condo vs. Freestanding Building

Which is the better investment — a freestanding commercial building or a commercial condominium within a larger complex? Each has its own unique set of attributes, and so the answer really depends on the needs, goals and characteristics of the investor.....(more)

• Negotiating The Sublease

With changes in business strategies, a major existing tenant wants to sublease all or some of their rented office space to eliminate some locations and shrink operations in others. In this situation, the problem for landlords is whether it is a better strategy to enforce lease restrictions against subleasing or to work with tenants on the theory that the sooner cheap sublease space is filled, the better for all. (In addition, another problem could be whether landlords should insist on sublease restrictions in new leases being negotiated now.)......(more)

• Unusual Real Estate Properties

In many metropolitan areas, commercial land for development is in very short supply. Developers are converting older warehousing to shopping areas, demolishing existing buildings to build new projects in areas in transition. However there may be many hundreds or even thousands of unusual parcels of property that have been overlooked. Many are ready for commercial development close to downtown areas, suburban commercial developments, and densely populated areas. Owners of many of these properties consider the property as “surplus” and have not considered development. Some of these properties are in the inventories of city, county and state ownership and are surplus parcels that were unused in street, highway and freeway development. Others are owned by railroads....(more)

• Things To Check With A Ground Lease

Landowners may choose the ground lease as a way to benefit an easy and risk-free investment vehicle and as a way to secure the long-term appreciation of the property. Sometimes a ground lease can put the lessor at risk. That is because the deal centers on the concept of sharing economic returns. The lessor becomes a partner of the lessee because the total rent is usually determined by the lessee’s net operating income or net cash flow. If the lessee does well, the lessor does too. However, if the lessee’s business is a loser, so is the lessor....(more)

• Extra Income From Campus Apartments

When an owner has an apartment property near the campus of a University, there are particular problems. The competitive situation dictates that leases be offered for one semester of nine and a half months. A twelve-month lease for students is virtually unheard of. That means there are lots of vacancies as soon as final exams have ended. (This does not apply to a few University communities where there is always an apartment shortage. In those few places, the student must lease for 12 months or have no lodging.).....(more)

• A Step-Down Rental
Tenants understand the need for step-ups in their leases because they recognize the inevitable upward trend of costs. There is no reason for elaborate set of definitions in the lease. The lease simply needs to spell out in a schedule the applicable period and the rent to be paid during that period.....(more)
• Selection Of New Tenants
The property manager provides the tenant applicant with the lease application which must be filled out for the interview. A leasing agent may assist during the review process, but the final selection of tenants is ultimately the property manager and owner’s responsibility. All leasing personnel should be informed that the company does not discriminate on the basis of an applicant’s race, sex, color, creed, or national original....(more)
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This month's newsletter has just been released! Check out the latest tips for tenants and users of commercial real estate space. In this issue

• Allowing Subleasing for Commercial Tenants

In some office building markets throughout the country, some existing tenants have sought to sublease some or all of their rented space as they shrink operations or eliminate locations. The problem for landlords is whether it is a better strategy to enforce lease restrictions against subleasing or to work with tenants on the theory that the sooner cheap sublease space is filled, the better for all. (In addition, another problem could be whether landlords should insist on sublease restrictions in new leases being negotiated now.)....(more)

• Lease Clauses Needed For Protection Of Confidential Information

​Typically, a landlord has access to leased premises at all times for purposes of making repairs and inspections. But in today’s information age, many tenants have valuable trade secrets, confidential information, and unique documentation in tapes, CDs, DVDs, listings, and other intellectual property that should not be accessible to the landlord. A software company tenant, for example, should try to obtain the right in the lease to maintain locked documentation rooms where even the landlord’s janitorial and maintenance people have no access and the landlord is given no copies of keys, pass cards, or cipher lock combinations to the additional locks installed by the tenant on the documentation room door......(more)

​​​​​How To Make Quick Profits When A New Hospital Comes To Town

​​​​What happens to nearby property values when a new hospital is built? Usually the surrounding area feels a ripple effect. Land values increase. Developers are quick to provide new space for offices and stores. The biggest profits are realized by the investors who get involved early (during the planning stages) before or while the hospital is built.......(more)

• Critical Lease Clauses

The following is a useful list of items that should be clarified between the parties in the lease of a commercial building:......(more)

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This month's newsletter has just been released! Check out the latest tips for tenants and users of commercial real estate space. In this issue

• Developing A Preventative Maintenance Program

Preventative maintenance is one of the most important components of successful property management. An aggressive preventative maintenance program should be developed for both large and small properties, regardless of whether building staff consists of only a part-time maintenance worker or a larger number of employees supported by a computerized maintenance program. Aggressive maintenance means trying to foresee any problem. Maintenance of any commercial or apartment building should be handled as much as possible on a routine basis rather than on an emergency one. Preventative maintenance must be performed on a regular basis to keep the level of service at the property high and to reduce equipment breakdowns and service interruptions. Toward this end, the maintenance staff and on-site manager should make regular inspections for the repair and replacement of items before problems occur. Preventative maintenance reduces the number of emergencies by anticipating wear and tear that the property, buildings and equipment will undergo......(more)

• ​An Emergency Plan In Your Building

Building owners and managers are becoming aware of their obligations to prepare for emergencies that can happen in buildings. The examples of the terrorism emergencies or fires throughout the country and the world are reminders of what can happen. Emergencies happen when least expected, so office building and apartment managers must be ready in advance and have a plan prepared. Things that can happen are fire, power failure, bomb threat, crimes and civil disorders. Here are some components of a plan of preparation for emergencies in buildings. .......(more)

• Possibilities For Increasing Income

We are certainly all looking for ways to increase income. Sometimes the possibilities for changes are right before us. If you now own a commercial property or an apartment complex, you might try looking at the property with “new eyes” to see if you can spot any changes that could make you some extra rental income. Of course, if any structural changes need to be made, or changes that would be affected by zoning regulations, etc., proper permits need to be secured, and contacts with the government agencies that would be involved should be made in advance.......(more)

• Benefits Of Commercial Condos

When the word condominium is mentioned, do you always think of residential properties? Of course, most condominiums are ones that people live in. But, let’s consider the other condominiums. There are all kinds. Any type of rental real estate can be converted to a condo. There are a growing number of commercial condos, many of them professional offices. The benefits are the same as owning a free standing building used as an office. A leading benefit is the security of having an owned unit free from any problem of having to move at the end of a lease period. Like owning any commercial property, interest on loans, taxes and expenses can be deductible.......(more)

• Help With Investment Real Estate

When you have searched for new real estate investment opportunities, with values that have been changing, you know that finding and evaluating them is becoming more sophisticated and complex. More investors are turning to real estate consultants as a means of providing a sounding board for their ideas as well as expertise in the planning and construction stages for their projects. Today’s investor in real estate must have a grasp 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.....(more)

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