Possible Deal part 2 (by GKARL [PA]) Feb 19, 2018 1:02 PM
Possible Deal part 2 (by GKARL [PA]) Feb 19, 2018 4:21 PM
Possible Deal part 2 (by DJ [VA]) Feb 19, 2018 7:13 PM
Possible Deal part 2 (by GKARL [PA]) Feb 19, 2018 7:25 PM
Possible Deal part 2 (by S i d [MO]) Feb 20, 2018 6:30 AM
Possible Deal part 2 (by Richard [MI]) Feb 20, 2018 8:03 AM
Possible Deal part 2 (by GKARL [PA]) Feb 20, 2018 8:43 AM
Possible Deal part 2 (by Ray-N-Pa [PA]) Feb 25, 2018 3:00 PM
Possible Deal part 2 (by Deanna [TX]) Feb 25, 2018 6:40 PM
Possible Deal part 2 (by GKARL [PA]) Feb 25, 2018 7:04 PM
Possible Deal part 2 (by Robin [WI]) Feb 26, 2018 3:59 AM
Possible Deal part 2 (by Ray-N-Pa [PA]) Feb 26, 2018 5:37 AM
Possible Deal part 2 (by GKARL [PA]) Posted on: Feb 19, 2018 1:02 PM Message:
Possible Deal part 2 (by GKARL [PA]) Posted on: Feb 19, 2018 4:21 PM Message:
This is a followup post on the deal I mentioned the other day.
Met with the seller today and was able to inspect residential and commercial units. Everything is mostly new. They have sunk significant money into improvements and everything is new from heating systems to electrical. That means that future capex should be minimal. There are some minor things that will need to be done with the external portion and I'll get my inspector in to check things out. At what they're asking, this is a steal and I'm going to go for it. I just submitted an offer on a duplex that I think I'm going to pull back and concentrate solely on this. Seller is willing to hold some paper, so I can do this with with minimal money upfront and hold my money back for carrying costs until I get everything rented. I didn't want to appear to be too anxious, but I want to get a contract on this like yesterday.
The commercial units are mostly ready to go. I'll cut a deal with the seller to finish certain aspects and I'll roll from there. One of them is big enough for a small laundromat. The others are set up as office spaces/storefronts. There's an apartment complex near the building that I have to canvass. If they don't have washers and dryers in the complex, a laundromat might be viable. Of course, that could change if those were provided later. That must be carefully evaluated.
Obviously, this involves some risk. But the nature of business is pitch and toss. I just don't want to end up with snake eyes. --64.121.xxx.xxx |
Possible Deal part 2 (by DJ [VA]) Posted on: Feb 19, 2018 7:13 PM Message:
It almost sounds too good to be true. So I can't help but wonder: if it has such potential, why are they selling, and why at a price that is a steal?
Hopefully, it's just your lucky day! --68.105.xxx.xxx |
Possible Deal part 2 (by GKARL [PA]) Posted on: Feb 19, 2018 7:25 PM Message:
I can not share but surface details now. There's far more that I've not shared. I'll share more once I close. I will say this however--this is a blessing that has little to attribute to me per se, but one that I was directed to. I don't deserve it, but God knows what I need and he directs the path. I'm just following along. It's not like I planned this or have any special insight. That was made clear to me today. --207.172.xx.xxx |
Possible Deal part 2 (by S i d [MO]) Posted on: Feb 20, 2018 6:30 AM Message:
GKARL, you're a smart guy and I cringe to offer what is obvious advice, but I have to take issue with the "future CapEx will be minimal" comment.
With an upgraded property, NOW is the time to start setting aside CapEx reserves so that, 15-20 years from now when you're lovin' life and rolling in the dough, all you have to do is write checks to fix/upgrade the stuff that is new today and will be worn out tomorrow. Protect your cash flow tomorrow with reasonable set asides today. I know you probably know this...let's say it's "just in case any newbies stop by..."
All that aside, sounds like this could be a fun and profitable deal. Any word on the age/condition of the plumbing? Water seems to cause me more trouble and cost the most $$$ of anything over the years. Old electric, even the feared "knob and tube", if in good condition...just sits there and works. Plumbing seems like it was designed to leak in the slightest of ways for the longest of times with the least amount of warning. --173.17.xx.xx |
Possible Deal part 2 (by Richard [MI]) Posted on: Feb 20, 2018 8:03 AM Message:
If you do get a laundromat in it, give your rooming house tenants a discount deal of they use it. More money for you. --96.94.xxx.xx |
Possible Deal part 2 (by GKARL [PA]) Posted on: Feb 20, 2018 8:43 AM Message:
Sid, I'm still learning, so I appreciate all advice and comments--that's why I'm here. You're 100% correct. What I really meant was no immediate capex (fat finger typed "future"..LOL) but yes, money will need to be set aside. Thanks for the correction.
Electrical is all new. I'm not sure of the status of the plumbing. Some of it is new where however. There's been a lot of new construction throughout. Plumbing problems are something I worry about and is definitely an area to look into.
Another thing that's favorable here is the ability to offset operating costs like insurance, taxes and general maintenance with a common area maintenance charge pass through on the commercial component. Most smaller mixed use buildings don't do that and I don't know if I can do in this situation either, but I'm certainly going to try. It's not as if triple net leases are uncommon for commercial tenants. --64.121.xxx.xxx |
Possible Deal part 2 (by Ray-N-Pa [PA]) Posted on: Feb 25, 2018 3:00 PM Message:
My next laundry machines will be the card type instead of coin. I want the money today and if they lose the card its a whoops. I can always give them an initial card as part of a move in package.
In the world of commercial rentals, so much depends on how zealous the code enforcement is in that community. It is awesome to see people interested in purchasing a property, but when they tell you to tear out a 3 year old ADA bathroom and re-engineer it to the current code because there is a change in use for the space - the cost of the building is suddenly the cheap part of the transaction. So how do you know? You slowly dip your toe in --24.101.xxx.xxx |
Possible Deal part 2 (by Deanna [TX]) Posted on: Feb 25, 2018 6:40 PM Message:
Congrats on your progress! It sounds very exciting. Keep us posted! --96.46.xxx.xx |
Possible Deal part 2 (by GKARL [PA]) Posted on: Feb 25, 2018 7:04 PM Message:
Deanna--I will update. I have it under contract now and will hopefully close in the next few weeks. After I get to that point, I'll lay out the deal, my plans and post a few pictures.
Ray---point noted. The good thing about this deal is that everything is mostly new construction on the internals while the building itself is old. --207.172.xx.xxx |
Possible Deal part 2 (by Robin [WI]) Posted on: Feb 26, 2018 3:59 AM Message:
So happy for you, GKarl! Sounds like you kept knocking on doors until the right one opened! --204.210.xxx.xxx |
Possible Deal part 2 (by Ray-N-Pa [PA]) Posted on: Feb 26, 2018 5:37 AM Message:
GKarl - strange thing happens to those who work harder than other........they seem to be luckier than other too.
Best of luck with the new deal.
Before deciding on the laundromat, check in with the local sewer authority and see how much they will be billing you and if there are any special requirements. --24.101.xxx.xxx |
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