Details

Commercial Real Estate Investing For Dummies


Commercial Real Estate Investing For Dummies


2. Aufl.

von: Peter Conti, Peter Harris

17,99 €

Verlag: Wiley
Format: EPUB
Veröffentl.: 29.03.2022
ISBN/EAN: 9781119858515
Sprache: englisch
Anzahl Seiten: 400

DRM-geschütztes eBook, Sie benötigen z.B. Adobe Digital Editions und eine Adobe ID zum Lesen.

Beschreibungen

<b>Make your money work for you with sound commercial real estate investment strategies</b> <p>If you're looking for more detailed advice on the commercial real estate market than, "Buy low, sell high," you've come to the right place. <i>Commercial Real Estate Investing For Dummies</i> is where you can find the smart, straightforward, and accurate info you need to get your start&mdash;or grow your portfolio&mdash;in commercial real estate. <p>You'll learn foundational strategies, tips, and tricks for investing in all sorts of commercial properties, from apartments to shopping malls. You'll also get rock-solid advice on: <ul> <li>How to get started in commercial real estate investing, even if you've never tried it before</li> <li>How to work with business and investment partners and protect your own interests with contracts</li> <li>Financing your investments with a variety of instruments and taking advantage of legal tax opportunities</li> </ul> <p>Growing wealth by investing in real estate is a strategy as old as money itself. Do yourself a favor and get in on the action with this straightforward and up-to-date guide!
<p><b>Introduction</b><b> 1</b></p> <p>About This Book 1</p> <p>Foolish Assumptions 2</p> <p>Icons Used in This Book 2</p> <p>Beyond the Book 3</p> <p>Where to Go from Here 3</p> <p><b>Part 1: Getting to Know Commercial Real Estate Investing</b><b> 5</b></p> <p><b>Chapter 1: Just Imagine Commercial Real Estate and You!</b><b> 7</b></p> <p>Defining Commercial Real Estate 8</p> <p>Getting Started 9</p> <p>Making money with commercial real estate investing 9</p> <p>Categorizing investors 10</p> <p>Crunching the numbers 12</p> <p>Exploring investing opportunities 13</p> <p>Financing a property 13</p> <p>Understanding the Risks of Commercial Real Estate 14</p> <p>Avoiding lawsuits, the most feared risk 14</p> <p>Risk-proofing your investment plan 15</p> <p><b>Chapter 2: A Crash Course in Commercial Real Estate Investing</b><b> 17</b></p> <p>Comparing Commercial Real Estate and Residential Real Estate 18</p> <p>Deciding to Invest in Commercial Real Estate 19</p> <p>Exploring the Available Types of Investments 21</p> <p>Apartment buildings (also known as residential properties) 21</p> <p>Office buildings 22</p> <p>Retail centers 23</p> <p>Warehouses or industrial properties 23</p> <p>Self-Storage Facilities 23</p> <p>Hotels and resorts 24</p> <p>Getting Started 25</p> <p>Easily meeting people and making new friends 25</p> <p>Doing simple math 26</p> <p>Accounting and collecting 26</p> <p>Recognizing Myths and Questions about Investing in Commercial Real Estate 26</p> <p>Timing the Commercial Real Estate Market 28</p> <p>Knowing whether to buy, hold, or bottom-fish 28</p> <p>Following Trends 31</p> <p><b>Chapter 3: Evaluating Commercial Real Estate</b><b> 33</b></p> <p>Talking the Talk: Terms You Need to Know 34</p> <p>The Commercial Property Evaluator 37</p> <p>Why Seller&rsquo;s Numbers Can&rsquo;t Be Trusted 37</p> <p>How the Commercial Property Evaluator Works 38</p> <p>Diving Deeper into Property Valuation 41</p> <p>Not-so-obvious tips on analyzing 42</p> <p>Breakeven analysis 44</p> <p>Establish and follow guiding principles 44</p> <p>Running the Numbers on Some Properties 46</p> <p>Analyzing an apartment deal 47</p> <p>Analyzing a retail shopping center 49</p> <p>Valuing Properties like a Professional 52</p> <p>Approach #1: Comparable sales 53</p> <p>Approach #2: Income 54</p> <p>Approach #3: Cost to replace the property 54</p> <p>Understanding What Creates Value 55</p> <p>Use: How the property is used gives value 55</p> <p>Leases: As the lease goes, so goes the value 56</p> <p>Location: The unchangeable factor 58</p> <p>Differentiating a Good Deal from a Bad Deal 60</p> <p>Cash-flow investors 60</p> <p>Long-term investors 61</p> <p>Short-term investors 61</p> <p><b>Part 2: Getting Started Making Deals</b><b> 63</b></p> <p><b>Chapter 4: Getting Started by Wholesaling</b><b> 65</b></p> <p>Navigating Too Many Deals 66</p> <p>Wholesaling Apartment Buildings 68</p> <p>Getting started without very much money 68</p> <p>A Wholesaling Example 69</p> <p>Getting Started: The Five Steps 70</p> <p>Step one &mdash; generating leads 70</p> <p>Step two &mdash; analyzing properties 71</p> <p>Step three &mdash; getting it under contract 72</p> <p>Step four &mdash; finding a buyer 73</p> <p>Step five &mdash; close and get paid 74</p> <p>Buying From Wholesalers 74</p> <p>Other Tips to Closing a Wholesale Deal 75</p> <p>Make sure you help the seller 76</p> <p>Put your reputation ahead of making money 76</p> <p>Identifying what a good deal looks like 77</p> <p>Snagging a Good Deal from Lazy Landlords 77</p> <p>Choosing the right neighborhoods 78</p> <p>Acquiring the Tools of the Trade 79</p> <p><b>Chapter 5: On Your Mark, Get Set, Go Find Deals</b><b> 81</b></p> <p>Discovering the Secret to Finding Great Deals 81</p> <p>Defining your property search 82</p> <p>Developing relationships 83</p> <p>Getting Leads on Commercial Property Investments 84</p> <p>Branching out 84</p> <p>Fishing for Leads on Branch One Properties 85</p> <p>Finding Branch Two Properties 85</p> <p>Dealing with government agencies 85</p> <p>Negotiating with realtors and brokers 86</p> <p>Joining property owner associations 87</p> <p>Networking with real estate investment clubs 88</p> <p>Looking Locally and Nationwide 89</p> <p>Surveying the pros and cons of local investing 90</p> <p>Investing outside of your community 90</p> <p>Determining your location with demographics 91</p> <p>Locking Down Deals: Don&rsquo;t Leave Home without These Strategies 93</p> <p>Allowing the Great Deals to Find You 94</p> <p>Attracting owners with reports 94</p> <p>Making unsolicited offers 95</p> <p>Discovering properties that have been relisted 95</p> <p><b>Chapter 6: Strategies for Making Offers and Negotiating</b><b> 97</b></p> <p>Increasing Your Chances of Getting Your Offer Accepted 98</p> <p>Starting with the end in mind 98</p> <p>Sizing up the sellers and what they really want 98</p> <p>Sealing Deals: The Instant Offer System 100</p> <p>Step 1: Build rapport with the broker or seller 100</p> <p>Step 2: Establish an up-front agreement 102</p> <p>Step 3: Build the broker&rsquo;s or seller&rsquo;s motivation level for selling 102</p> <p>Step 4: Determine the financial details of the deal (The Money Step) 104</p> <p>Step 5: Find the critical pieces to a winning deal (The What-If Step) 106</p> <p>Meeting the Seller to Submit Your Offer 107</p> <p>Writing Up the Offer 108</p> <p>Letter of intent 109</p> <p>Commercial contract to buy and sell real estate 110</p> <p>Liquidated damages clause 110</p> <p>Memorandum of agreement 111</p> <p>Presenting Your Offer in the Best Light 111</p> <p>Filtering Through Deals 112</p> <p>Filter 1: The five-minute test 112</p> <p>Filter 2: Sign it up! 113</p> <p>Filter 3: The quick view 113</p> <p>Filter 4: The &ldquo;realists&rdquo; check 114</p> <p>Filter 5: End users determine the value 115</p> <p>Celebrating Accepted Offers and Moving to the Next Stage 116</p> <p><b>Chapter 7: Due Diligence: Doing Your Homework</b><b> 119</b></p> <p>Doing Your Due Diligence 120</p> <p>Making due diligence a team effort 121</p> <p>Getting to the truth about due diligence 123</p> <p>Putting Property Under Contract 124</p> <p>Scope out the property 125</p> <p>Get a title commitment 125</p> <p>Look at the property&rsquo;s numbers 125</p> <p>Creating Checklists for Effective Due Diligence 126</p> <p>Physical due diligence checklist 127</p> <p>Financial due diligence checklist 128</p> <p>Legal due diligence checklist 129</p> <p>Managing the Whole Process 131</p> <p>Opening an escrow 131</p> <p>Getting a preliminary title report 132</p> <p>Keeping an eye on contingencies 134</p> <p>Digging up (and Solving) Problems 136</p> <p>Renegotiating with the seller 137</p> <p>Making the final decision 138</p> <p>Setting the sails for the closing date 138</p> <p><b>Part 3: Funding Your Deals: Financing and Lending</b><b> 141</b></p> <p><b>Chapter 8: Conventional Financing Options</b><b> 143</b></p> <p>Wading through the Commercial Lending Process 144</p> <p>Seeing the process through your lender&rsquo;s eyes 144</p> <p>Keeping things moving without incident 146</p> <p>Knowing the Differences between Commercial and Residential Lending 147</p> <p>What matters most to commercial lenders 148</p> <p>The down payment requirement is higher 148</p> <p>Evaluating Properties Like a Lender 149</p> <p>Determining the property&rsquo;s income 149</p> <p>Revealing the quality of the property and its neighborhood 151</p> <p>Assessing the strength of the borrower 153</p> <p>Getting Your Lender to Say, &ldquo;You&rsquo;re Approved!&rdquo; 154</p> <p>What your lender needs from you 154</p> <p>What lenders need regarding the property 155</p> <p>What lenders like in a deal 156</p> <p>What lenders don&rsquo;t like in a deal 156</p> <p>Choosing the Best Loan for You 157</p> <p>Getting to know conventional lenders 158</p> <p>Understanding the available conventional loans 159</p> <p>Selecting a lender for your deal 161</p> <p>Deciding what you want out of your property 162</p> <p>Determining how much the loan will cost you 163</p> <p>Knowing the costs of getting out of a loan 164</p> <p>Controlling the interest rate (to some extent) 165</p> <p>Assuming the Seller&rsquo;s Preexisting Mortgage 166</p> <p><b>Chapter 9: Getting Creative with Financing</b><b> 169</b></p> <p>Creative Financing Techniques 170</p> <p>The Master Lease Technique 173</p> <p>Getting Someone to Carry Owner Financing 174</p> <p>Coming up with the Rest of the Money Using Secondary Financing 176</p> <p>Using the Existing Financing 176</p> <p>Finding sources of secondary financing 178</p> <p>Understanding common pitfalls of secondary financing 180</p> <p>Getting the owner to agree to finance all or part of the purchase 180</p> <p>Dealing with seller objections 181</p> <p>Operating the Wraparound Mortgage Like a Surgeon 183</p> <p>Using an Option to Buy 184</p> <p>Leveraging the Equity in Your Portfolio 185</p> <p>Employing blanket mortgages 185</p> <p>Drawing on 401(k)s or IRAs 185</p> <p><b>Chapter 10: Forming Partnerships and Syndicating Deals</b><b> 187</b></p> <p>Identifying the Keys to Raising Private Funds 188</p> <p>Building Your Database of Potential Investors 189</p> <p>Creating relationships with potential investors 189</p> <p>Using executive summaries to nab potential investors 193</p> <p>Connecting with your investors 194</p> <p>Deciding Whether to Go It Alone or Use a Partner or Two 195</p> <p>Creating the Right Teams and Partnerships 195</p> <p>Joint Ventures and Syndications 196</p> <p>Knowing how much to pay your investors 196</p> <p>Creating a Compelling Investor Presentation 197</p> <p>Writing up the agreements to use with your investors 199</p> <p>Considering how long you want to partner with someone 199</p> <p>Interviewing a potential partner 199</p> <p><b>Chapter 11: Closing Your Deal</b><b> 201</b></p> <p>Evaluating the Anatomy of a Close 202</p> <p>Closing 101: The Basics of Closing a Deal 203</p> <p>What is an escrow and who is an escrow officer? 203</p> <p>What is title insurance? 203</p> <p>Do I need an attorney for my closing? 204</p> <p>Do closing costs differ in commercial real estate? 205</p> <p>Is it better to close at the end or beginning of the month? 206</p> <p>How long does it take to close a commercial deal? 206</p> <p>Asking Yourself Big Picture Questions 207</p> <p>What are my exit strategies? 207</p> <p>Are my investment goals being met? 207</p> <p>Sweating the Details before Signing on the Dotted Line 208</p> <p>The title work 208</p> <p>The closing instructions and closing statement 209</p> <p>The lender 210</p> <p>Closing Day: What to Expect 211</p> <p>What&rsquo;s on a closing statement? 211</p> <p>What exactly will I be signing? 213</p> <p>What should I do before signing? 214</p> <p>When am I officially closed? 216</p> <p>Taking Legal Ownership 216</p> <p>Acting and Being the Boss 217</p> <p>Stage 1: Assess the situation 218</p> <p>Stage 2: Assemble the team 218</p> <p>Stage 3: Secure the site 219</p> <p>Stage 4: Use the info that you discovered 220</p> <p><b>Part 4: Day-to-Day Ownership and Operations </b><b>221</b></p> <p><b>Chapter 12: Property Management: Who&rsquo;s Minding Your Ship?</b><b> 223</b></p> <p>Being the Boss: Manage Your Commercial Property Yourself 224</p> <p>Improving your management skills with a few basic tips 224</p> <p>Developing basic business systems 226</p> <p>Doing it Yourself: A checklist 227</p> <p>Training your tenants to respect you and the property 228</p> <p>Operating successfully day-to-day with the proper people and tools 230</p> <p>Letting Go: Using Professional Property Management Companies 232</p> <p>Understanding the ins and outs of professional property management 232</p> <p>Deciding to hire a professional property management company 233</p> <p>Searching for property management candidates 234</p> <p>Interviewing your prospective managers 235</p> <p>Checking credibility and capability 236</p> <p>Drafting the property management agreement 237</p> <p>Getting your reports: Monthly and weekly accountability 240</p> <p>Knowing How to Be an Effective Absentee Owner 243</p> <p><b>Chapter 13: Protecting Your Assets </b><b>245</b></p> <p>Taking Asset Protection Seriously 245</p> <p>Create a plan to avoid lawsuits 246</p> <p>Plan for the worst and be happy if it doesn&rsquo;t happen 247</p> <p>Building a Legal Fortress for Personal Assets 247</p> <p>Making use of entities 248</p> <p>Using your entities to your advantage 249</p> <p>Gathering essential fail-safe documentation 251</p> <p>Protecting Yourself with Common Sense 252</p> <p>Treat others as you would like to be treated 252</p> <p>Meet any potential problems head-on 252</p> <p>Always have proper insurance coverage 253</p> <p><b>Chapter 14: Why Properties Fail</b><b> 255</b></p> <p>What Is a Property Failure? 256</p> <p>How You, the Investor, Can Cause Failure 256</p> <p>You made a bad deal 257</p> <p>You have too much debt 259</p> <p>You&rsquo;re in denial regarding problems 260</p> <p>How Management Can Cause a Property to Fail 261</p> <p>How the Market Can Cause Failure 263</p> <p>The ups and downs of real estate cycles 264</p> <p>Buy right and avoid overleveraging 265</p> <p>The influence of demographics 266</p> <p>When to Fold Up and Walk Away 268</p> <p>Knowing when to fold 268</p> <p>Choosing to walk away honorably 268</p> <p>Tried and True Tips on Surviving and Thriving 270</p> <p><b>Part 5: Kicking Your Investing into High Gear</b><b> 273</b></p> <p><b>Chapter 15: Making a Success Out of Commercial Fixer-Uppers</b><b> 275</b></p> <p>Identifying Commercial Fixer-Uppers 276</p> <p>Distressed and poorly performing property 277</p> <p>Distressed and poorly performing owner 277</p> <p>How to find fixer-uppers 279</p> <p>Where to buy 281</p> <p>Figuring Out What a Fixer-Upper Is Worth 282</p> <p>Determining your cash flow 283</p> <p>Figuring your NOI, cap rate, and sales price 283</p> <p>Running the numbers on an example property 285</p> <p>Mapping Out a Fixer-Upper Game Plan 286</p> <p>Perform due diligence 287</p> <p>Before fix-up and after: Bridging the gap to payday 290</p> <p>Determining your break-even point 291</p> <p>Creating checkpoints for the renovation process 292</p> <p>Avoiding Headaches and Pitfalls (Or at Least Minimizing the Pain) 295</p> <p>Recognize hopeless situations 295</p> <p>Hire good contractors (and think like one when you do projects yourself) 296</p> <p>Timing Your Fixer-Upper for a Quick Sale 297</p> <p><b>Chapter 16: Land Development: The Heart of Commercial Real Estate</b><b> 299</b></p> <p>Weighing the Pros and Cons of Investing in Land 300</p> <p>The pros 300</p> <p>The cons 300</p> <p>Understanding What Makes Land Worth More 301</p> <p>Knowing Whether You&rsquo;re in the Right Market 302</p> <p>Identifying the Three Ps for Successful Projects 303</p> <p>Investing in Land with a Team 304</p> <p>Finding the Best Places to Invest in Land 305</p> <p>With Land, Time Really Does Equal Money 307</p> <p>Using contracts to get more time 307</p> <p>Buying time with options 309</p> <p>Changing the Property&rsquo;s Zoning and Getting Approved to Develop 310</p> <p>Determining what to build on your land 311</p> <p>Taking master plans into consideration 311</p> <p>Keeping a level-head during the approval process 313</p> <p>Getting the Green Light on Your Deal 315</p> <p>Dealing with bureaucrats 317</p> <p>Avoiding neighborhood opposition 318</p> <p><b>Chapter 17: Self-Storage: A Favored Asset </b><b>319</b></p> <p>Investing in self-storage facilities 320</p> <p>Upgrading and converting 321</p> <p>Profiting during good times and bad 322</p> <p>Choosing the Best Locations 324</p> <p>A self-storage deal 324</p> <p>A simple way to evaluate a facility 325</p> <p>Finding and hiring the right self-storage facility manager 325</p> <p>Keeping an eye out for your next manager 326</p> <p>Tips to choosing a good manager 327</p> <p>Getting funding from investors 327</p> <p>Marketing Self-Storage Facilities 328</p> <p>Building a self-storage website 329</p> <p>Using Social Media 330</p> <p>Paying for clicks (PPC) 330</p> <p>Keeping it traditional: flyers &amp; billboards 331</p> <p><b>Chapter 18: Expert Tax Advantages and Strategies</b><b> 333</b></p> <p>An Overview of Money-Making Tax Strategies 334</p> <p>Appreciation 334</p> <p>Depreciation 335</p> <p>Paying down the mortgage 335</p> <p>Rolling over 336</p> <p>Being an Investor or a Dealer: The Difference Is Huge 336</p> <p>Holding real estate long term as an investor 337</p> <p>Comparing wholesalers and dealers 337</p> <p>Naming Yourself a Real Estate Professional: It Pays 338</p> <p>Choosing Your Entity: An Important Tax Preparation Before You Buy 339</p> <p>Sole proprietorships 341</p> <p>Corporations 341</p> <p>Limited liability companies 341</p> <p>Limited partnerships 342</p> <p>Digging into Depreciation 342</p> <p>The magic of depreciation 343</p> <p>Don&rsquo;t &ldquo;recapture&rdquo; your depreciation 344</p> <p>Cost segregation: Saving thousands more by separating your property parts 345</p> <p>Avoiding Taxes by Trading in for Another Property: The 1031 Exchange: 347</p> <p>Before anything else, get expert help 348</p> <p>Surveying the exchange rules 349</p> <p>Taking Advantage of Some Commonly Overlooked Deductions 350</p> <p>Accounting expenses 351</p> <p>Consulting expenses 351</p> <p>Home office expenses 351</p> <p>All property-related expenses 352</p> <p>Transportation to and from your properties 352</p> <p>Expenses for your technology gizmos 352</p> <p><b>Part 6: The Part of Tens</b><b> 353</b></p> <p><b>Chapter 19: Ten Ways to Increase Your Property Value</b><b> 355</b></p> <p>Raising the Rents 356</p> <p>Budgeting Your Way to Wealth 356</p> <p>Giving the Property a Makeover 357</p> <p>Changing the Property&rsquo;s Use 358</p> <p>Adding Goodies to the Property 358</p> <p>Standing Up to the Tax Man 359</p> <p>Passing Utility Expenses to Tenants 360</p> <p>Renegotiating the Leases 360</p> <p>Bringing in a New Management Team 361</p> <p>Adding Value to Land 361</p> <p><b>Chapter 20: Ten Easy Ways to Network</b><b> 363</b></p> <p>Finding Easy Places to Network 364</p> <p>Getting Your CCIM Designation 364</p> <p>Putting Power in Your Search Engines 365</p> <p>Going Directly to the Investment Firms 366</p> <p>Reading the Trades 367</p> <p>Joining a National Association 367</p> <p>Getting Involved with BOMA 368</p> <p>Enlisting with the ICSC 368</p> <p>Becoming Affiliated with the IREM 369</p> <p>Staying Current and Connected 369</p> <p>Index 371</p>
<p><b>Peter Conti</b> bought his first commercial property in 1990. He coaches beginner investors on commercial real estate investment. He founded RealEstate101.com.</p> <p><b>Peter Harris</b> is the Director of Education at Commercial Property Advisors. He has personally mentored hundreds of commercial real estate investors nationwide since 2003.
<p><b>Strike a deal and watch the rent checks roll in </b></p> <p>Picture that “For Sale” sign turning into a “SOLD” sign on the lawn of your first commercial property purchase. <i>Commercial Real Estate Investing For Dummies</i> gives you the foundation you need to find success in this high-return investment category. Learn how to find bargains, finance your investments, close deals, and watch your bank account grow. This book even covers the basics of developing land and fixing-and-flipping commercial properties. If you’re ready to make money as a commercial property owner, this is the crash course for you. <p><b>Inside… <ul><li>Investing in apartments, mobile home parks, self-storage, and more</li> <li>Identifying good properties</li> <li>Networking and finding deals</li> <li>Getting started by wholesaling</li> <li>Raising capital for investments</li> <li>Minimizing your tax bill</li> <li>Increasing property values</b></li></ul>

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