The Goose That Laid The Golden Egg

Some years ago I purchased a shop with an apartment upstairs in Bondi. Over that time it’s produced awesome cash flow for me. A few years ago, with zoning and planning changes in the area, I was able to build up and adding two apartments above which added to the cash flow considerably. The original leases, of course, had built in rental increases, which, subsequently increased the value of the property over time. But when you start chucking on additional apartments, you not only increase …

The difference between a goal and a true life-catalyst

  So every morning I get up early to go for a surf. I like the quiet time. In the same way that fishing for some people is more about the sitting quiet and waiting for the fish… …Surfing is as much sitting and waiting for the right set to come in as it is actually getting up on a wave. It’s time to think. It’s time to contemplate. In a way, it’s time to remember who you are outside of all the things you …

The Time Factor in Commercial Contracts that Help You Make Money

  Use your time wisely I took a call from an old friend last night. She was asking me for some advice about a property that she wanted to buy. It was a small, old run-down house (I know right! The cheek of calling me and asking me about residential) that was going to auction at the end of the week. Small… old… ugly… with bonus asbestos. Not ideal – but it was cheap, so it had that going for it. She told me about …

Testing Your Resolve: Dealing With Commercial Agents

Estate agents are a different breed… I know, I used to be one. (I’ve still got my licence – but I don’t use it.) This is especially true of commercial agents. You’d think that if you were selling a property for someone… and of course trying to sell it TO someone, you’d make every effort to service enquiries that come in about properties you have in your books. After all when you sell a property as an agent – you make money. That’s how it …

What Happens When A Tenant Leaves

Commercial leases are typically 3 years… that’s the average. They usually have an option… say: a 3+3+3 lease. That means that after the first 3 years the tenant has the option of renewing two more times. Simple enough. It’s not uncommon for tenants to take all 3 options and even renegotiate the lease at the end of that period as well. If a business is going well it usually makes sense for them to stay put where customers know where to find them. But… As …

Valuing Vacant Properties

Buying a vacant commercial property is not something that I recommend for most commercial investors. I’ve only done this a few times… Although it was very successful when I did… But that’s because I had the basics covered and I understood how to work out what the property was really worth. When a commercial property is tenanted, it’s very easy for a valuer to come up with a true and accurate valuation… That’s because the value of a commercial property is intrinsically tied to its …

It’s not about floor space – it’s about opportunity

I’ve noticed a trend in (esp) capital cities… Not just here in Australia but all around the world. Now I’m finally taking a leaf out of this playbook and looking and putting it into action. What am I talking about? Tiny shops. There’s a movement to making shop spaces much smaller. I first really sat up and paid attention to this a couple of years ago when I was in Sydney looking at the Crumpler bag store. It’s not a big store, and the main …

NEGOTIATION STALLED? Here’s how to breathe new life into it.

From time to time when you’re negotiating on a property purchase negotiations can stall. Maybe your offer is too far from what the vendor wants, or maybe you want a “Subject to” clause that they don’t understand or are unwilling to grant. Luckily commercial negotiations can often take quite some time, running over weeks or even months so you may have more time than you are used to, to work through the details of the deal. Here are a few ideas use could use to …

A Crash Course In Honest Numbers

  Getting Honest with yourself about the numbers Over the weekend one of my relatives asked me to take a look at a couple of properties she was interested in buying. They were both commercial, which is why she had come to me. This wasn’t her first rodeo when it came to investing in property. I think she has a flat somewhere – but it was her first commercial. For that reason, she’d already done some research and due diligence. 1- She’d travelled to the …

Why buying remotely is stupid – It pays to go look at it.

I’ve seen quite a few deals where people have bought commercial properties based on the numbers and images from the agent. While, as you know I’m all about the numbers… My basic rule of thumb is the numbers have to work… Never buy based on gut instinct or anything like that. But here’s the deal. If the numbers work… you still should go an inspect the property. Over the last few months, I’ve been looking for a shopping centre to buy. I’ve made an effort …