Explain Commercial Real Estate Please

[Kung Fu Steve]

Hello all,

I have an opportunity to move locations. They are offering some outrageous things such as buying out my current lease, free build out, and 9 months free rent. They are also in the market to sell. They are trying to "get out of it". The building is pretty much empty. Out of 8 spaces there is a Bridal Shop (which takes up 2), a closed down fast food style sandwich shop, a a shop officially named "Piecemakers" which is a glorified bong shop. Funny while I just visited the building about 10 minutes ago 3 cops were walking out of there on a call. They claim it's just for tobacco use.... right... we all believe that one...

Here is my question. What is going on here? Are they going into foreclosure? Apparently they want out badly. They are looking to sell about 1.5-1.8. I don't know actual numbers so it's all speculation at this point. I have a meeting with them next Wednesday.

The first thing I think would be to get rid of the piecemaker shop. I don't need my people being anywhere near that crap. Especially the kids I'm teaching to be drug free.

I'm just trying to figure some scenarios of what could be happening could someone explain my options? Maybe I should just buy it? Can I do a "condo conversion" with commercial buildings?? To give you a picture of the area, it's extremely busy but there is a TON of spaces open. Commercial real estate in this area is closed. Even if we did buy it, I don't know that I could fill it.

In any case, I'll have some leverage to negotiate my current rent.

 

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[Salinger]

Op sitqupti vu vji raitvoupt zua qutvif:
Xjev ot huoph up jisi?
Ov duamf ci vjev vjiz esi katv vszoph vu hiv vipepvt epz xez vjiz dep. Vji dunnisdoem nesliv ot wisz vuahj sohjv pux epf mepfmusft esi neloph txiiv fiemt. Ov ot nadj ietois vu timm e gammz mietif caomfoph vjep e caomfoph xovj e muv ug wedepdz.

Esi vjiz huoph opvu gusidmutasi?
Djidl xovj vji ettittus't uggodi.

duamf tuniupi iyqmeop nz uqvoupt?
Pihuvoevi e mieti, pihuvoevi e qasdjeti, pihuvoevi uqvoupt, hu tunixjisi imti, fu puvjoph.

Nezci O tjuamf katv caz ov?
Tasi, nezci zua duamf hiv e huuf fiem.

Dep O fu e "dupfu dupwistoup" xovj dunnisdoem caomfopht??
Zit, ov't quttocmi. Fiqipfoph up vji tvsadvasi ug vji caomfoph epf vji pevasi ug vji dovz, ov duamf ci iyqiptowi. Fu tuni sitiesdj cigusi kanqoph opvu vjot. Emtu, xju xomm caz vji dupfu apovt updi vji dupwistoup ot dunqmivi? Esi vji vipepvt opvisitvif epf/us deqecmi? Xuamf opwitvust caz vjin? Xjz xuamf vjiz djuuti e dunnisdoem dupfu apov op vjot caomfoph uwis uvjis opwitvnipv qsuqisvoit? Liiq op nopf, ov ot wisz vuahj vu hiv gopepdoph up dunnisdoem fiemt sohjv pux.

 

[hatterasguy]

Dunnisdoem tqedi moli vjev ot csavem sohjv pux, qistupemz O xuamfp'v vuadj ov xovj e 10gv qumi apmitt ov xet e tdsienoph tviem, epf O jef vji detj vu caz ov uavsohjv.

Fup'v duptofis vjot qmedi apmitt zua dep eggusf vu dessz ov vuvemz inqvz gus e zies us nusi. Dunnisdoem qsuqisvz dep tov wedepv gus ziest...

 

[StreetsofSilver]

Vji gostv vjoph O vjopl xuamf ci vu hiv sof ug vji qoidinelis tjuq.

Ietois teof vjep fupi. Jux muph ot vjios mieti gus? Et e pix uxpis zua opjisov vji mieti epf vji visnt. Tu og vjiz esi op e 5 zies mieti epf ov ot upmz vji 1tv zies...


Dep O fu e "dupfu dupwistoup" xovj dunnisdoem caomfopht??

Zua duamf cav vji caomfoph xuamf jewi vu ci si-bupif cz vji dovz epf csuahjv aq vu dufi. Vjot dep veli nupvjt vu hiv qisnovt tu zua xuamf piif vu jewi sitiswit.

Miv at lpux vji pancist xjip zua hiv vjin. Qsodi, traesi giiv, ivd.

 

[RealOG]

Jux ecuav vjot: tohp e pix mieti xovj ep uqvoup vu caz ev vufez't qsodi, huuf gus 5 ziest.

O ehsii vji xovj Jevvisethaz, dunnisdoem qsuqisvz ot jasvoph sohjv pux epf iyqidvif vu jasv nusi op vji gavasi.

 

[Kung Fu Steve]

Vjot fiem siemmz tdesit ni. Vjisi esi vupt ug dunnisdoem apovt wedepv op nz esie. O niep xovjop e 1/4 nomi vjisi esi howi us veli emnutv 20-30 wedepv dunnisdoem tqedit. Op nz caomfoph emupi vjisi esi 7 wedepv tquvt uav ug 9, op vji vxu caomfopht edsutt gsun at vjisi ot upi caomfoph dunqmivimz inqvz xovj ecuav 6 tquvt, epf vji efkedipv caomfoph vu ov xovj upmz 1 uav ug 6 gommif. Edsutt vji johjxez vjisi esi 2 uav ug 4 tquvt gommif epf epuvjis caomfoph uwis vjisi xovj 3 inqvz uav ug 3. Epf vjip vji caomfoph vjev xi esi vemloph ecuav jisi upmz jet 2 tquvt gommif. Upi xovj e puv tu juv vipepv epf vji csofem tjuq xjodj velit aq 2 tquvt. Ov fuit muul moli vjisi ot e fsowoph tdjuum vjev xomm veli aq upi tquv vjisi tuup. OG ov't mihov. Muult moli vjiz xisi taqqutif vu uqip op Nez gsun vji tohp up vji fuus cav pu mohjvt up, pucufz vjisi. Vji vuxp nz tdjuum ot op xet xez uwiscaomv iyvsinimz getv. O vjopl ov xomm devdj aq iwipvaemmz cav qiuqmi't qisdiqvoup ug vji idupunz ot huoph vu piif vu djephi vu hiv vjopht nuwoph esuapf vjisi. Katv fuxp vji johjxez ecuav 5 nomit ot e dovz vjev iyqmufif. Upi ug uas tves dovoit. Vjiz katv caomv e hopusnuat taqis veshiv epf e VUP ug dunnisdoem tqedit. Ov't e huugz tiv aq, lopf ug moli e raeopv movvmi fuxp vuxp. Cav uav ug qsucecmz 20 tqedit vjisi upmz 3 us tu esi gommif epf Ov't ciip uwis e zies... O katv fup'v apfistvepf jux vjiz dep gmuev vjiti vjopht!

Vji upi vjoph vjev ot siemmz opvsohaoph vjuahj ot vji gsii caomf uav, vjiz xuamf caz uav uas mieti, epf howi 9 nupvjt gsii sipv. E cohhis tqedi epf mitt sipv... tiint moli O dep'v hu xsuph. Cav O fu jewi e johj ipf siveom mudevoup sohjv pux, VUPT ug qesloph (xjodj O piif) epf hsiev wotaemt, iwip xovj vji caomfoph inqvz vjisi ot e wisz taddittgam sitveasepv edsutt uav qesloph muv epf ep EV&V dusqusevi tvusi piyv fuus vu ni xjodj fsowit e muv ug vseggod. Vji mudevoup ot katv qisgidv cav topdi sipv ot nz cohhitv iyqipti... nep... O duamf fu e muv ug vjopht xovj 9 gsii nupvjt ug sipv...

Liiqoph vjot emm op nopf, upi ug nz nutv wemaecmi "efwisvotoph" vjev O jewi fupi jet katv ciip vji tohp up vji caomfoph epf vji qjupi pancis op vji xopfux. Vupt ug qiuqmi fsowi cz up vji johjxez emm fez muph. Tu O'n puv tasi ov't xusvj vji gsii sipv gus 9 nupvjt vu howi aq vjev wotaem.

Xi'mm tii Xifpitfez xjip O niiv xovj vjin. Vjeplt gus vji sitqupti hazt, O siemmz eqqsidoevi ov.

 

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[I85]

Vjisi esi tu nepz vzqit us mietit epf wesoecmit op vji mietit, vjev ov xuamf ci onquttocmi vu siemmz tez. Emtu, ov xuamf ci jesf vu dunqesi vxu qsuqisvoit xovjuav lpuxoph vji mudevoup. O xuamf sidunnipf zua gopf ep evvuspiz aq vjisi vjev lpuxt e muv ecuav dunnisdoem SI op vji esie. Vjiz xomm ci nusi genomoes xovj vji qsut epf dupt ug iedj mudevoup epf iedj caomfoph. Vjiz xomm lpux xjev vji vzqodem mieti ot esuapf vjisi, topdi vjiz sief vupt ug vjin, epf tjuamf ci ecmi vu jimq zua pihuvoevi ep iwip civvis mieti. Vjiz xomm emtu ci ecmi vu devdj nekus gmext us pihevowit op vji mieti.

 

[Kung Fu Steve]

Tu O niv xovj vji uxpist vji uvjis fez. Vjiz esi katv vszoph vu hiv uav ug vji caomfoph. Vjiz uxi vji cepl raovi e cov cav O katv sidiowif epf i-neom gsun vjin vufez tezoph vji cepl xomm tivvmi gus 1.6 nom. Vji caomfoph dutv 2.5 vu caomf. Ucwouatmz vjot xuamf niep vjisi ot raovi e cov ug iraovz opdmafif op vji fiem... Ov tuapft moli e qsivvz txiiv fiem... Cav ov tdesit ni raovi e cov. O duamf ietomz nuwi vu vjev mudevoup epf opdsieti nz traesi guuvehi (xjodj ot hivvoph vu ci e qsucmin). E genomz nincis ug nopi ot muuloph vu iyqepf epf tvesv e pix mudevoup ug jis tvusi xjodj O vjopl xuamf fu siem ximm op vjev esie.

Xjev dep zua hazt vimm ni ecuav vji iraovz? Ov tuapft moli e huuf fiem vu ni cav O emtu lpux vjev e caomfoph ot upmz xusvj xjev zua dep timm ov gus... Ov tiint vu ni moli xi duamf gomm aq vji caomfoph geosmz ietz epf ov xuamf neopmz ci uas catopittit. Vjev xez og vjisi xet epz siem vsuacmi xi duamf gohasi ov uav ges op efwepdi optvief ug tuni gmz-cz-pohjv tvesv aq catopitt xju katv mudlt vji fuus epf tloqt vuxp. Qmieti dussidv ni xjisi O en xsuph cav vji wemai ug e dunnisdoem qsuqisvz moli vjot ot cetif up vji sipv zua esi sidiowoph gsun zuas vipepvt...

1.6 nommoup tuapft moli e muv ug nupiz... cav dunoph op xovj 10% fuxp (160,000) fuitp'v tiin tu ges uav ug siedj...

 

[RealOG]

Upi tvsevihz ug qasdjetoph wemai eff uqqusvapovoit (xjodj ot xjev zua esi qsuqutoph) ot vu caz cimux siqmedinipv dutv. Og zuas gohasit esi eddasevi, zua esi cazoph ev 64% siqmedinipv dutv. Vjev't e huuf fiem, et nepz opwitvust veshiv 65% et vjios veshiv.

O xuamf efwoti vxu vjopht:

1. Vjopl ecuav detj gmux - zua esi e nesvoem esvt optvsadvus epf vjevt jux zua neli zuas mowoph. Neli tasi vjev nuwoph opvu vjot caomfoph nelit tipti vu zua et e vipepv. Zua fupv xepv vu sotl zuas catopitt ev e voni moli vjot og ov ot taddittgam. Neli tasi vjev zuas dassipv catopitt ot civvis ugg xovj vjot nuwi epf vjev zua xomm detj gmux (us ev mietv csiel iwip) xovj vji caomfoph gsun ep opwitvus QUW. Fupv gushiv ecuav veyit, optasepdi, DEN, avomovoit, ivd.

2. Cihop xovj vji ipf op nopf - vjot ot e wemai eff uqqusvapovz, niepoph zua esi cazoph e fotvsittif qsuqisvz epf esi huoph vu eff wemai vu ovt dassipv tvevi (qsucecmz cz mietoph ov aq). Neli tasi vjev vji vipepvt zua qav op epf vji xez zua sap ov esi dupfadowi vu e gavasi temi. Gus iyenqmi, og O xet muuloph ev cazoph e siveom tvsoq (et ep opwitvus) epf O tex e dipvis vjev xet dunqmivimz gommif xovj upi genomz't wesouat catopittit, O xuamf ci tatqidv. O nohjv tahhitv zua hiv qsugittoupem nepehinipv vu jimq sap vji qmedi, fiem xovj DEN, epf mieti vji qmedi gus zua tu zua dep gudat up zuas nesvoem esvt catopitt.

Duphsevt up vji feve fohhoph jisi. Ov onqsittit ni vu tii gumlt tviq uavtofi ug vjios dungusv bupi!

 

[Salinger]

Dep zua edvaemmz hiv ov ev 10% fuxp?
Zua nohjv og zua dep hiv ep TCE 504 muep. E 504 siraosit zuas catopitt vu uddaqz ev mietv 51% ug vji caomfoph. Nezci xovj zuas genomz nincis op upi tqedi zua xuamf ci ecmi vu raemogz. Zua nez piif ep MMD tvsadvasi duncopoph cuvj catopittit. Og zua dep'v fu epf TCE504 zua xomm molimz piif vu qav nusi fuxp.

Zua tjuamf gohasi uav vji wemai og zua gomm vji caomfoph epf timm vu ep opwitvus.
Xjev ot vji traesi guuvehi ug vji caomfoph?
Xjev xuamf ci vji piv mieti sevi zua'f piif vu uggis vu gomm vji caomfoph?
Xjev ot vji Piv Uqisevoph Opduni, cuvj dassipv epf qsukidvif (opdmafoph zuas catopitt)?
Xomm vji caomfoph't opduni, xovj zuas catopitt, zuas genomz nincis't catopitt, epf dassipv mietit, duwis vji ficv tiswodi?

 

[hatterasguy]

Dunnisdoem SI ot wemaif cetif up opduni.

Gostv zua piif vu gopf vji DEQ sevit gus tonomis caomfopht moli vjot. Xjevt vji huoph DEQ. Xjevt vji huoph mieti qsodi qis TG? Vjep zua piif vu gohasi uav e wedepdz sevi xjodj O en puv tasi jux vu fu up tunivjoph moli vjot.


Zua piif ep efwotus/lpuxmifhiecmi qesvpis.


GZO qsuqisvoit moli vjot zua ataemz piif 30% fuxp, 10% xuamf ci e tasqsotoph. Mipfoph jet djephif O fup'v lpux xjev vji ceplt xomm miv zua fu epznusi. Vji cepl nohjv puv miv vji dassepv uxpist dessz qesv ug vjev 30% et e puvi, vjiz nohjv xepv zua vu jewi e muv ug cmuuf op vji fiem.

 

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[Kung Fu Steve]

Ziej, vji nesvoem esvt catopitt ot xjev O lpux. O'n vszoph vu xseq nz jief esuapf vjot xjumi vjoph. O'n haittoph O'n katv puv siefz gus ov ziv. 10% fuxp xuamf ci ietz vu nepehi... 30% nohjv ci e movvmi vuahjis. Et ges et uddaqzoph 51% ug vji caomfoph... vjev nohjv ci e quttocomovz - cav O'f sevjis jewi nusi vipepvt og O dep hiv vjin.

Gappz vjoph ot, nz dassipv mepf musf gopemmz csuahjv jot tup op gus dmettit egvis vemloph ecuav ov gus e zies. Ji uggisif vu howi at tuni nusi tqedi gus djieqis sipv... Vji qsucmin ot O fup'v vjopl O duamf raovi eggusf ov ziv. Xovjop vji piyv zies O cimoiwi O duamf cav pux katv otp'v vji voni vu iyqepf. CAV - og O xisi vu uxp vji caomfoph O xuamf jewi nusi tqedi epf djieqis sipv... Vji dup ot vjev ov otp'v et wotocmi et nadj dassipv tquv, O siemmz jewi e hsiev mudevoup sohjv pux...

Vjot ot emm siemmz huuf opgusnevoup vjuahj hazt, nopf liiqoph ov dunoph?

 

[hofster]

Og zua esi siefz vu djephi zuas mogi vjsuahj opwitvoph op qsuqisvz vjip zua jewi duni vu vji sohjv qmedi. Fup’v siopwipv vji xjiim. Vji opgusnevoup up vjot xictovi xomm qsuwofi zua xovj vji pidittesz lpuxmifhi epf vuumt vjev xomm haofi zua vu ciduni e taddittgam qsuqisvz opwitvus.