Investor Sales and Acquisitions

Investing in Commercial Real Estate

OUR #1 PRIORITY IS TO UNDERSTAND OUR CLIENT’S GOALS.

Commercial Real Estate Investment

This might include:

  • A company that would like to explore becoming an owner occupant.  If so, are they seeking SBA financing?  Would they like to occupy a portion of the property and realize income from the remaining space?
  • An individual or group seeking to diversify an overall investment portfolio with the addition of real estate?  If so, should this be a passive investment accomplished though a NNN property?  Is there a particular sector that best meets the investor expertise or inclination?
  • An investor that would like to move into a different location or type of real estate and should be considering the capital gain tax deferment vehicle afforded through a 1031 exchange?
  • A value-add buyer looking to acquire a distressed asset that can be improved or stabilized, creating income generation and appreciation.

While the end goals may vary, the basis of all sound commercial real estate acquisition is sound asset valuation.  This includes:

  • Analysis of Income and Expenses (NOI)
  • Are the overall expenses realistic for the property type?
  • Are there sufficient reserves for vacancy, maintenance and capital expenditures?
  • Examine rent roles and tenant quality.
  • Has management cost been accounted for?
  • What is the deferred maintenance on the property?  What is the cost associated with the deficiencies and what is the urgency of the remedy?
  • What are the vacancies rates in comparable properties?
  • What are the site specifications and the effect on the property’s value?
  • How is the micro and macro market trending?
  • What is the appropriate CAP rate for property in current physical condition, market conditions, type of real estate, industry sector, demographics, location, etc.