Discover how you can analyze any commercial real estate quickly and easily with 5 key terms.
Views: 153614 Commercial Property Advisors
How to estimate the right valuation for a Commercial Property and what kind of rental returns can you expect from a Commercial Real Estate in India? Let's understand the three methods to value a commercial property in India. Explained in Hindi. Related Videos: Commercial Property Investment: https://youtu.be/QGfQMqPc9kE 1. Fair Market Value of a Commercial Property in India 2. Rental Yield Method or Gross Rent Multiplier Method for a Commercial Real Estate in India 3. Land and Building Method for an Indian Commercial Property किसी कमर्शियल प्रॉपर्टी की सही वैल्यू कैसे एस्टीमेट करें और किस प्रकार के रेंटल रिटर्न्स आप इंडिया में कमर्शियल रियल एस्टेट प्रॉपर्टी से एक्सपेक्ट कर सकते हैं? चलिए समझते हैं इंडिया में कमर्शियल प्रॉपर्टी के मूल्य का आंकलन करने की 3 विधियां। 1. इंडिया में कमर्शियल प्रॉपर्टी की फेयर मार्केट वैल्यू 2. इंडिया में कमर्शियल प्रॉपर्टी के लिए रेंटल यील्ड मेथड या ग्रॉस रेंट मल्टीप्लायर मेथड 3. इंडिया में कमर्शियल प्रॉपर्टी के लिए लैंड एंड बिल्डिंग मेथड Share this Video: https://youtu.be/Hvf7kSwgpDE Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: How to buy commercial property in India? How to evaluate the value of any commercial property in India? What type of returns can you expect from commercial real estate property? How much rental returns can be expected from a commercial property in India? What are the methods to evaluate the price of any commercial property? What evaluation methods are used to evaluate the price of commercial property in India? How to calculate the right price of a commercial property in India? इंडिया में कमर्शियल प्रॉपर्टी कैसे खरीदें? इंडिया में किसी भी कमर्शियल प्रॉपर्टी के मूल्य का मूल्यांकन कैसे करें? किसी कमर्शियल रियल एस्टेट प्रॉपर्टी से आप किस तरह के रिटर्न की उम्मीद कर सकते हैं? इंडिया में एक कमर्शियल प्रॉपर्टी से कितनी रेंटल रिटर्न की उम्मीद की जा सकती है? किसी कमर्शियल प्रॉपर्टी की कीमत का मूल्यांकन करने के क्या-क्या तरीके हैं? इंडिया में कमर्शियल प्रॉपर्टी की कीमत का मूल्यांकन करने के लिए किन मूल्यांकन विधियों का उपयोग किया जाता है? इंडिया में किसी कमर्शियल प्रॉपर्टी की सही कीमत की गणना कैसे करें? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Twitter - http://twitter.com/assetyogi Instagram - http://instagram.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Google Plus – https://plus.google.com/+assetyogi-ay Pinterest - http://pinterest.com/assetyogi/ Facebook – https://www.facebook.com/assetyogi Hope you liked this video in Hindi on “Commercial Property Valuation and Returns in India".
Views: 10849 Asset Yogi
How To Value Your Commercial Property For Sale Establishing fair market value has a consistent process that can yield a very reliable valuation result. Review the properties improvements locations and how it fits in the competitive nature of the real estate marketplace. Haw does the property perform as an investment? Are they national corporations or local start-ups? Commercial Real Estate Advice from two experts in the Commercial Real Estate field, Ben Tiner and Tony Wood. About Ben Tiner: After earning his Managerial Economics degree from U.C. Davis, Ben joined the commercial team at Tiner Properties in 2005 as a Commercial Asset Manager. Ben is a licensed California Real Estate Broker and actively manages the Commercial Portfolio of an estimated Three million square feet of retail, office, medical, and industrial space throughout the Greater Sacramento Area. He is active in both the sale and leasing of commercial property. Ben's clients include the Government Services Administration (GSA), CarQuest, Sprint, Subway, medical practitioners and investment holding companies. Ben is driven by his passion for every client, property and transaction he is involved with. Ben's book "Commercial Property Leasing" is an essential tool for everyone involved with commercial real estate. Ben's most recent achievement is earning his Certified Commercial Investment Member (CCIM) designation. About Tony Wood: Tony Wood is well known for his market insights and signature “Forensic Approach” to commercial real estate transactions. For over 30 years Tony has specialized in a wide spectrum of commercial real estate services. With extensive experience in all real estate property types and ownership structures, Tony’s experience includes the leasing and sale of office, retail, industrial, investment and owner-user properties throughout the Western United States. His consulting services encompass valuation, market studies and transactional trusted advisor. He is retained as a professional witness and consultant to banks, law firms, insurance companies and CPAs. Tony is motivated by the difference he can make in each transaction. Tiner Commercial Real Estate services the Greater Sacramento Area with Property Management, Sales and Leasing. Website: www.tinercommercial.com Phone: 916-999-3900
Views: 3672 Tiner Commercial Real Estate
http://www.commercialpropertyadvisors.com/starting-small-in-commercial-real-estate/ Discover how you can start small with commercial real estate and work your way up into bigger and bigger deals. If you have limited capital, are risk averse, have very little experience or are intimidated by the big numbers of commercial property, consider the steps in this video to starting small. You'll also discover that small commercial deals can be extremely profitable. In fact, there are far more small commercial properties than large ones so you have more options and opportunities. This is the perfect video for anyone who wants to get into commercial real estate investing but has been held back by fears and trepidation. Let Peter Harris guide you through the big, scary world of commercial real estate quickly and easily.
Views: 51010 Commercial Property Advisors
Investing in commercial real estate can be an incredibly lucrative wealth-building tool, but it isn't necessarily as easy as single-family rentals or multi-family and certainly has a lot more questions involved. In this video, Jesse Fragale, commercial real estate broker & Canadian Investor, will share the 4 commercial real estate spaces to help you better understand which one you might be interested in investing yourself! These four types of commercial real estate spaces involve multi-family, retail, industrial, & office! Each unique in its own and each offering pro's & cons. Jesse shares these and touches on them to help you better understand commercial real estate investing to help you get started on your journey. Join us & our favorite Canadian contributor in this video! Have a question? Simply ask in the comments :) ----------------------------------------------------------------------------------------------------------- Join our community! - https://www.biggerpockets.com Insta: @jfragalz & @brokerbanter https://www.instagram.com/jfragalz/ https://www.instagram.com/brokerbanter/ Linkedin: https://www.linkedin.com/in/jessefragale/ Jesse's Personal Youtube Channel: https://www.youtube.com/user/JesseFragale _________________________________________________________________ ► Music Credit: DJ Quads Track Names: "Summer Time" "The Society" "Just Roll With It" "Little Dream" Music by: Dj Quads @ https://soundcloud.com/aka-dj-quads Official YouTube Channel HERE: https://www.youtube.com/channel/UCusFqutyfTWRqGhC8kHA5uw SoundCloud HERE: https://soundcloud.com/aka-dj-quads Twitter HERE: https://twitter.com/DjQuads Spotify HERE: https://open.spotify.com/artist/2VZrdImbvB03VWApYtBRr3 Instagram HERE: https://www.instagram.com/djquads
Views: 8243 BiggerPockets
For more information on this subject, or for any commercial real estate related questions or information, you’re invited to call Michael Bull at 404-876-1640 x 101. Any question, anywhere, anytime.
Views: 906 America's Commercial Real Estate Show
A basic real estate valuation model for office, retail, or industrial deals built in Microsoft Excel. The model includes a simple DCF module to calculate cash flows over the hold period, as well as an equity waterfall module for calculating partnership returns. You can download the model for free here: http://www.adventuresincre.com/real-estate-acquisition-model-for-office-retail-or-industrial-properties If you have any questions or comments, feel free to contact the author, Spencer Burton, at http://www.spencerburton.org
Views: 45230 Spencer Burton
Stay knowledgeable by subscribing! http://bit.ly/iLiveInTheBayArea Visit my site for even more information: http://www.iLiveInTheBayArea.com Like me on Facebook: http://www.fb.com/iLiveInTheBayArea If you own your own company, whether you are expanding your operations or simply staying where you are, one question has likely come up. Is it better to own our own space or lease it? With prices being the way they are, it might very well be the best time to buy your own real estate. However, owning MIGHT not be the best solution depending on what some of those intrinsic answer turn out to be. Why don't we look at a few well-known brands to see what their lease v own model is...Starbucks and Chevron. Starbucks...the little coffee shop from Seattle that started in 1971 and is now the largest coffee house in the world with over 17,000 stores in over 50 counties. Starbucks is a company that expanded SO FAST that in the 1990's until about mid 2000 they opened a new coffee house every single workday. If you're ever in downtown San Francisco or NY, it's not that hard to find two Starbucks locations on opposite street corners Now let's look at the Starbucks mode. Nearly all of their locations are in retail shopping centers or high density office markets in downtown locations. If Starbucks bought their location, they'd have to buy the entire retail center or the entire office complex and manage them for investment...something that's not in their business model. Instead, they lease all their locations. Also, we have to know what Starbucks expects their Net Present Value to be as explained in my "Determining Net Present Value" video. At one point I recall reading that for every $1 Starbucks received from an investor through stock, they could turn and make over .25-50 cents with that same $1 in a single year. A company that's rapidly growing like Starbucks would always set their NPV over 25 to 50%. The reason they could set it at such a high number was because they knew they could create SUCH a profit from a single dollar! Most income property can make anywhere from 5-20% depending on location and risk...so realistically, what kind of property doubles in value every year? If Starbucks is making 25-50 cents in profit for every dollar received, they would have to find a property worth buying that could make just as much. Considering how highly implausible that is, why would they waste their time when they could just lease out a space and keep expanding and making money? Now let's take a look at Chevron - a large company that is still growing, but at a much slower pace than Starbucks due to their smaller profit margin...Without knowing the exact numbers, let's presume for every $1 they receive from an investor they create 5-10 cents profit. A company like Chevron may not be able to demand such a large NPV like Starbucks, but they can definitely demand a 5-10% NPV rate because that is the profit they expect to make. Chevron of course wants to grow and expand, but nowhere NEAR the pace as Starbucks...they simply can't!! They're already grown! So with their NPV at 5-10%, even if the property they purchase doesn't appreciate in value very much or make them a good return, it may still be worth it for the STABILITY. Can you imagine if Chevron rented some of their huge refineries and all of a sudden the landlord raised rents on them because the market has gone up?? What do you think would happen to their bottom line? Would they be able to REALLY relocate their huge refinery? What do you think would happen to the consumer at the gas pump? What leverage would they have as a company vs. Starbucks who could simply pack up and move across the street if they don't like the lease rates? Remember, the rule that buying is better than leasing doesn't always apply in business. First and foremost, you have to decide whether or not you want the stability and commitment of a large purchase, or the flexibility of leaving once your lease is done. There's also financial issues in regards to if you have the capabilities for such a large transaction. These are just some of the questions that have to be addressed when considering leasing or owning. Usually, if your business is rapidly expanding, leasing is the common case. Whereas if you're looking for stability and modest growth, a purchase may be a better option. If you're wondering if expanding is right for you or what kind of data you can get for when the time comes, be sure to watch my "Site Selection" video. Determine the negatives and positives of both scenarios and determine at which point you would feel comfortable with either buying or leasing. This way you can use your capital wisely to help your business flourish the way you see fit...now that's good to know.
Views: 9668 Davide Pio - CCIM, LEED AP
In this Value-Added Real Estate Private Equity Case Study tutorial video, you'll learn what to expect in real estate private equity case studies and you'll get an example of a real value-added RE PE case study with the solution file and a walk-through of the key points. Please get all the files and the textual description and explanation here: http://www.mergersandinquisitions.com/value-added-real-estate-private-equity-case-study/ Table of Contents: 2:41 Part 1: The Types of RE PE Case Studies 5:19 Part 2: This Case Study and What Makes It Tricky 12:40 Part 3: Why Excel is Horrible for This Case Study 16:59 The Scenarios in This Model 17:51 Part 4: The Property Model and Returns Analysis 26:39 Part 5: The Investment Recommendation 28:37 Recap and Summary Part 1: The Types of RE PE Case Studies The 3 main types are core / core-plus, value-added, and opportunistic. In the first category, the property stays nearly the same over the holding period and the market analysis is more important than a complex model. In the second category, the property changes significantly (more tenants, higher rents, a renovation, etc.) and the models tend to be more complex. The modeling often gets the most complex in the third category because a new property is developed, an existing one is redeveloped, or the building changes massively (e.g., rescuing a distressed property). The complexity also depends on how granular the model is - modeling individual tenants with different lease terms always gets more complicated than a high-level model with average unit sizes, square feet or square meters, etc. Part 2: This Case Study and What Makes It Tricky This case study is less about analyzing the market data, and more about getting all the Excel formulas correct, making the correct calculations, and finishing on time. Since we have information on 13 individual tenants in the building, we NEED to do a more granular analysis and look at each tenant separately. The Excel formulas for free months of rent, TIs and LCs, and other key terms in the leases are somewhat tricky to figure out. Part 3: Why Excel is Horrible for This Case Study The problem here is that there are two scenarios for each existing tenant: they might renew, or they might not renew, when their lease expires. If it's just these two scenarios you can do a reasonable job plotting them out in Excel. But when it goes beyond that - say, 2-year contracts over a 10-year period, resulting in 5 "renewal points" and 2^5 or 32 scenarios - Excel becomes unwieldy for this exercise. You're better off using ARGUS to model this if you have that level of complexity and an entire probability tree. As it stands, our formulas get quite complex here though they are not THAT difficult to understand if you break down the individual components. The Scenarios in This Model The main difference between the three scenarios here is that the occupancy rate stays the same, at 74%, in the Downside Case, whereas it increases to 80% in the Base Case because we find three new tenants, and it increases to 85% in the Upside Case as we find four new tenants. Also, the growth assumptions and the TIs, LCs, and other concessions such as free months of rent differ between the three cases and are most generous in the Upside Case and least generous in the Downside Case. Part 4: The Property Model and Returns Analysis In short, after setting up all the formulas for rent, free months of rent, absorption (the difference between market rent and in-place rent), turnover vacancy (the time between one tenant cancelling and moving out and finding a new one to replace him), and general vacancy, we fill out the rest of the Pro-Forma Model. We include all the operating expenses to determine the property's NOI, and then plot out the debt repayments over time and the interest expense paid on debt. The Acquisition/Exit assumptions and Sources & Uses schedule are all quite straightforward: we assume lower Exit Cap Rates due to the renovation, but there's less of a decline in the Downside Case. In the Returns Analysis, we set up a "waterfall schedule" to split and distribute the returns: up to a 10% IRR is split 80/20 between the LPs and GPs, then between a 10% and 15% IRR it's split 70/30, and then above 15% it's split 60/40. Part 5: The Investment Recommendation We recommend acquiring the property because the numbers work well and meet our targeted IRR and CoC multiple in the Base and Downside cases, the market data is positive, and we believe it's plausible for the occupancy rate and average rents to increase up to the market levels in the area. For the deal NOT to work, something catastrophic would have to happen: rents falling by 25%, the lease renewal rate dropping to 30%, or something in that vein... and we believe there are ways to mitigate against all those risks. http://www.mergersandinquisitions.com/value-added-real-estate-private-equity-case-study/
Views: 29015 Mergers & Inquisitions / Breaking Into Wall Street
How to invest in commercial property in India? Let's understand about the types of commercial property investments in India, Pros and Cons and what makes a commercial real estate a great investment? Also, we will see how to buy a commercial property in India. Related Videos: Commercial Property Valuation: https://youtu.be/qQ5uEbLycLs How to invest in Shop and Office: https://youtu.be/Hvf7kSwgpDE इंडिया में किसी कमर्शियल या वाणिज्यिक प्रॉपर्टी में कैसे निवेश करें? चलिए समझे हैं इंडिया में कमर्शियल प्रॉपर्टी इन्वेस्टमेंट के प्रकारों के बारे में, फायदे और नुकसान, और ऐसा क्या है जो कमर्शियल रियल एस्टेट को एक बहुत अच्छा इन्वेस्टमेंट बनता है? साथ ही हम ये भी देखेंगे की कैसे इंडिया में एक कमर्शियल प्रॉपर्टी खरीदी जा सकती है। Share this Video: https://youtu.be/QGfQMqPc9kE Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: How to invest in the commercial real estate in India? How to buy commercial property in India? What are the types of commercial real estate investment? What are the available investment options available in the commercial real estate in India? What are the advantages of investing in commercial property in India? What are the disadvantages of investing in commercial property in India? What are the risks of investing in commercial property? How much returns to expect from commercial property investment? What are some tips for investing in commercial real estate property? How to make sure you get returns from your commercial property investment? How to invest in retail property? How to invest in office property? इंडिया में कमर्शियल रियल एस्टेट प्रॉपर्टी में निवेश कैसे करें? इंडिया में कमर्शियल प्रॉपर्टी कैसे खरीदें? कमेर्टिकल रियल एस्टेट इन्वेस्टमेंट की कितने प्रकार होते हैं? इंडिया में कमर्शियल रियल एस्टेट प्रॉपर्टी में निवेश के उपलब्ध विकल्प क्या हैं? इंडिया में कमर्शियल प्रॉपर्टी में निवेश करने के क्या फायदे हैं? इंडिया में कमर्शियल प्रॉपर्टी में निवेश का क्या नुकसान है? कमर्शियल प्रॉपर्टी में निवेश करने के जोखिम क्या हैं? कमर्शियल प्रॉपर्टी निवेश से कितना रिटर्न की उम्मीद होती है? कमर्शियल रियल एस्टेट प्रॉपर्टी में निवेश करने के लिए कुछ अच्छे सुझाव क्या हैं? यह कैसे सुनिश्चित करे कि आप अपने कमर्शियल प्रॉपर्टी के निवेश से लाभ प्राप्त करें? रिटेल प्रॉपर्टी में कैसे निवेश करें? ऑफिस प्रॉपर्टी में कैसे निवेश करें? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Twitter - http://twitter.com/assetyogi Instagram - http://instagram.com/assetyogi Google Plus – https://plus.google.com/+assetyogi-ay Pinterest - http://pinterest.com/assetyogi/ Facebook – https://www.facebook.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Hope you liked this video in Hindi on “Commercial Property Investment in India".
Views: 23536 Asset Yogi
A quick description of Net Operating Income, Capitalization Rate, and Price - What they are, how they interact with each other, how to use them, etc. If I have made any mistakes, or omitted what seems like important relevant info then please message me or leave a comment! http://relevantproperties.com
Views: 150723 InvestRelevant
Stay knowledgeable by subscribing! http://bit.ly/iLiveInTheBayArea Visit my site for even more information: http://www.iLiveInTheBayArea.com Like me on Facebook: http://www.fb.com/iLiveInTheBayArea There's a small niche market for a certain types of investors. The types of properties in this niche market are called Value Add properties, and these investors usually have three things. A great deal of cash...a sophisticated team including their real estate broker and contractors, and the stomach to take some big and risky leaps. Chances are you've seen these properties just in your daily commute. The empty office buildings, the rundown apartments and the retail center that USED to be nice but now it's just so worn out. These are the type of properties that for the right price and the right investor can make huge amounts of income over time...if you have the right stomach for it! First, let me touch a bit on how valuating commercial property works. Here we have a $1M office building. Let's say it has 20 different spaces that it could rent out, and only 2 of them are rented. Together, each unit pays $1000/month. If you remember from my "Commercial Loan Process" video, a commercial loan has to pay for itself and THEN some. With the building listed for $1M, there is no WAY you could get a loan that's under $2000/month! Just in taxes and insurance alone would cost you more!! But wait...if the whole point of commercial investment real estate is to make a profit on the rents...why would I buy something that's going to make me a NEGATIVE cash flow every month? And this is exactly where the value add comes in! The first catch is that you have to buy this property with cash or with a hard money lender as I discussed in my "Hard Money Loan" video. You may be buying this property for $1M, but the good thing is that it would cost you MORE than that to even BUILD it from scratch...so you're already one step in the right direction. Not only that, but at this price, you could just undercut all the other office landlords and rent your remaining 18 units for $750/month. With that, you can fill it up in NO time!! Now instead of just $2000/month, you're making over $15,500! This easily translates to a high positive cash flow! Once the property is stabilized with these tenants for a while, you have a few options. First you can improve the building and charge the tenants more money once their leases are through. This adds value to your property - making it more desirable - and makes tenants more acceptable to paying higher rents since they'd be in an upgraded building. Secondly if you choose, you could refinance the property. This will free up some funds that you initially invested so you could reinvest elsewhere. Finally you could "flip" the property for a profit! Without getting into detailed numbers, if you do your research and find that OTHER similar office buildings which make about the same monthly income of $15,500/month are selling for $2M, then your property is likely in that same range. For those of you that are a bit more comfortable with homes, let me compare it to a residential value add. We all probably know it as "flipping houses". There's a $250k house that's completely gutted...no one wants to buy it all cash when they can buy the neighbor's house for $500k. Someone comes along and figures that they could do the repairs themselves...and after a few months and about $100k, the home is worth $500k just like the neighbors. You add the $250k home price plus another $100k in rehab, that's a $150k profit. There is a final catch to all this as well. There's always a potential for something to go wrong. For instance, let's say that you're unable to rent out the units for $750/month, and instead you have to rent them out for $500/month...what is that going to do to your projections? This is why you have to be able to weigh your risk vs. what you determine will happen in the future with as much analysis as possible. These niche value add properties aren't usually easy to find. And like I mentioned before, they come with a HUGE risks. This means that even though there MIGHT be a HUGE payoff after the project is completed there's also a chance you only break even or even lose money. Most people are completely comfortable making a safe 6-12% return, vs. risking it to make 15-20%. This is why having a sophisticated team working for you is essential. You need to have everything lined up before you even attempt to buy a value add type of property. Weigh all your risks, do all the research and analysis you can, and if you're confident -- and have the stomach to make some huge profits -- then go for it...now that's good to know.
Views: 2851 Davide Pio - CCIM, LEED AP
Find 3 smart startegies that can increase your commercial property’s value. The commercial/ real property valuers in Melbourne have brought these not groundbreaking ideas but effective rules to create an impressive property. Just follow the link and enjoy huge benefits on your property. To know more about our Commercial Property Valuation in Melbourne, visit https://www.fvg.com.au/commercial-property-valuation/
Views: 9 Mark Ruttner
We've finally closed on our commercial building in Palm Desert, it was 16,000 sqft. and completely vacant. In order to make buying the building feasible, we needed to create value while we were still in escrow. We lined up tenants, made plans for facade improvements and got a number of bids on the deferred maintenance. Taking these steps allowed us to close with confidence.
Views: 1 Adam Gilbert
http://www.commercialpropertyadvisors.com/how-to-make-offers-on-commercial-real-estate/ Discover what no classroom would ever teach you on how to make an offer on commercial real estate. You'll learn the absolute essential things you need to make an intelligent offer, including the 4 phases you must go through BEFORE you finalize your offer. Most importantly, the lessons in this video will educate you on how to avoid overpaying as well as the dreaded negative cash-flow scenario that some commercial investors experience when they first purchase. Lastly, you'll get access to a file that step by step, shows you exactly how to make the best offer on any commercial property.
Views: 36149 Commercial Property Advisors
This video is a companion to our A.CRE 101: The Income Approach tutorial over at AdventuresinCRE.com. To check out the entire post and download the Excel file: Read the entire tutorial and download the model: https://www.adventuresincre.com/acre-101-income-approach-value-income-producing-property Learn about the author: http://www.SpencerBurton.org
Views: 6150 Spencer Burton
Mair Property Funds Commercial Asset Manager, Alex Lambert, joins Brad Dunn to discuss some of the common value-add strategies investors and fund managers can take to enhance the value of their commercial property portfolio.
Views: 37 Mair Property Funds
In this lesson, you’ll learn what it means to “refinance” commercial real estate loans in development and acquisition deals, why Equity Investors do it, and how it can boost their returns in deals. https://breakingintowallstreet.com/ "Financial Modeling Training And Career Resources For Aspiring Investment Bankers" Table of Contents: 1:24 The Short Explanation for Refinancing 4:27 Examples with the Property’s Value Increasing 12:47 Different Types of Lenders and the Downsides of Refinancing 15:32 Recap and Summary Resources: https://youtube-breakingintowallstreet-com.s3.amazonaws.com/Real-Estate/Commercial-Real-Estate-Loan-Refinancing-Example.xlsx https://youtube-breakingintowallstreet-com.s3.amazonaws.com/Real-Estate/Commercial-Real-Estate-Loan-Refinancing-Slides.pdf Lesson Outline: A pair of questions that came in the other day: “Can you explain, in layman’s terms, why you often assume that Debt gets refinanced in real estate deals?” “Also, why is the amount of new Debt raised often different from the amount of existing Debt repaid?” SHORT ANSWER: Equity Investors complete refinancings to boost their returns in real estate deals – and because it’s in everyone’s best interest to do so. “Refinancing” means repaying existing Debt – almost all real estate deals involve Debt – by raising new Debt (think of it as “replacing” existing Debt). Refinancing boosts returns for the Equity Investors by reducing the interest expense and letting them earn back some of their initial investment before the exit (sale of the property). There are three main, specific reasons to refinance: Reason #1: Interest rates have fallen, or the property’s credit profile has changed, and the Equity Investors can get lower rates. For example, maybe interest rates have fallen from 5% to 4% – that may seem like a small difference, but since property deals often use 50-70% leverage, lower interest rates could result in a significant increase in cash flow. Reason #2: The property’s value has increased, so by refinancing at the same “Loan to Value” (LTV) Ratio, the sponsor can earn back some of its initial investment early – before the exit. For example, if an investor pays $10 million for a property that generates $600K in Net Operating Income (NOI) in Year 1 (6% Cap Rate) and uses a 70% LTV, that’s $7 million of Debt. By Year 3, the property’s NOI has increased to $650K, and market conditions have stayed about the same, so assuming the same 6% Cap Rate, the property is now worth $650K / 6% = $10.8 million. The New Debt would be worth $10.8 million * 70% = $7.6 million at a 70% LTV now, so the extra $600K in proceeds go to the Equity Investors early. We demonstrate a more complex example of this with a $54 million AUD hotel in Darwin, Australia, acquired at an 8.80% Cap Rate using an 85% LTV. After four years, the forward NOI has increased from $4.7 million to $6.3 million, so it is worth $70.5 million at a 9.00% Cap Rate. We refinance at a 75% LTV, slightly lower, and use a $52.9 million Permanent Loan to repay the $44.4 million of remaining acquisition debt and mezzanine at this point. That $8.5 million “extra” goes to the Equity Investors (it’s a bit less due to the financing fees). Without the refinancing, the 5-year IRR would be 17.9%; with the refinancing, it would be 19.1%. This is a small difference because Cap Rates rise slightly and the LTV drops – but if Cap Rates fall or the LTV stays the same or increases, refinancing could add far more than 1% to the IRR. Reason #3: The terms of the Debt require a refinancing. Different lenders target different risk and potential returns, and Construction and Bridge Loan investors don’t want to stay on board once a property is built or stabilized. So, these lenders often require property owners to refinance under certain conditions or when there’s a “change of control” (someone else buys the property). Downsides to Refinancing The Equity Investors might not refinance if the property’s value has fallen or if interest rates have risen. Refinancing does present some risk because it could increase the default risk, especially if the Interest Coverage Ratio or Debt Service Coverage Ratio fall. Finally, it can sometimes be tricky to estimate the correct property value and use it in these formulas, especially if the property has not yet stabilized and will take time to do so.
Join me for my 3 Day Multifamily Bootcamp! https://RodKhleif.com/Bootcamp Visit http://rodkhleif.com/free-book for a FREE copy of my book, “How to Create Lifetime Cash Flow Through Multifamily Properties. Rod Khleif created this video on How To Quickly Analyze An Investment Property Subscribe to my channel: https://www.goo.gl/YbNmzf Website: http://www.rodkhleif.com .: CONNECT WITH ME :. ----------------------------------------------------------------------------- Leave a comment on this video and it'll get to me. Or you can connect with me on different social platforms too: https://www.facebook.com/rodkhleiffan/ Instagram: https://www.instagram.com/rod_khleif Twitter: https://twitter.com/RodKhleif Linkedin: https://www.linkedin.com/in/rodkhleif ---------------------------------------------------------------------------- Visit https://rodkhleif.com/httpsrodkhleif-comfree-book/ for a FREE copy of my book, “How to Create Lifetime Cash Flow Through Multifamily Properties. ----------------------------------------------------------------------------- .: MORE ABOUT ME PERSONALLY :. --------------------------------------------------------- About: http://www.RodKhleif.com/about/ Today we’re going to talk about How to Quickly analyze an investment property Hi my name is Rod Khleif, and I’m host of the number one real estate podcast on iTunes, lifetime cash flow through real estate investing. I’m also author of the book, how to create lifetime cash flow with multi family properties. Quickly analyzing a commercial property is not only possible if you understand a few key terms…. But actually is much simpler than you might think when you’re evaluating commercial real estate, particularly multi family real estate there are a few things you’re going to want to know. For example You of course need to know How much money the property going to make you’ll want to know What the return is going to be on your investment And you’ll want to know How does the property that you’re looking at compare to other investments. What I’m going to show you today will help you with all of that. First, Let’s talk about the four key terms The first term you need know and understand is Net Operating Income. This is actually quite simple, the net operating income or NOI as it’s known in the business, is the gross Income on the property which would include rents, and any other income the properties producing for example from a laundromat or storage. Then you would just subtract the operational expenses on the property and the difference is the net operating income or NOI. So you understand these…….Operational expenses include things like, property insurance, taxes , repairs and maintenance, property management and advertising…. Now these operational expenses do not include the mortgage or debt. We’ll talk about where the mortgage comes in in a minute. I’m also going to give you an example so you can see this after I’m done describing these terms. So again the net operating income for the in a lie which is the first time you need to understand is simply the gross income on the property less the operational expenses. That’s the NOI. I actually think the analyze probably the most important number you’ll want to determine when evaluating a property because of The huge impact the NOI has on the value……when it goes up so does the value. In those increases in the property’s value from an increase in the N OI are really exponential. And when the NOI goes down so does the value down. Now remember, Don’t confuse NOI with gross income on a property. Cash Flow is the next very important barometer in investment property. For our purposes we will define Cash Flow as the NOI minus the mortgage payments on the property. The next very important term you need to be familiar with is Cash on Cash Return. Cash on cash return shows me How fast my money is moving. It actually tracks The velocity of your money. Or how fast its growing. It will show you How fast you can get 100% of your money back? So if you have cash on cash return of 25% you basically get your cash back in four years. 25% per year for four years as 100% of your cash back and again I’m going to show you an example of this in a moment. So the calculation for cash on cash is actually also very simple. It’s just the Annual cash flow divided by down payment or All of the money initially invested in the deal. Now let’s talk about the Capitalization Rate. The cap rate is used in the industry to evaluate different types of For more videos relating to How To Quickly Analyze An Investment Property, subscribe to my channel #HowToQuicklyAnalyzeAnInvestmentProperty? ----------------------------------------------------------------------------------------------------------- https://youtu.be/c4OL-7NhatE
Views: 10128 Rod Khleif
You need to get these from the seller before you can begin to value commercial real estate. It is critical that they be accurate as they are what determines your Net Operating Income (NOI). Google Great Rock Real Estate To learn more about us on Facebook, Twitter and our website. Looking for off market deals? We may be able to connect you with sellers. Great Rock Real Estate Denver Colorado http://www.greatrock1.com
Views: 320 Great Rock Real Estate
The Real Estate education and business models Cherif Medawar provides are unmatched by any other professional organization in the industry. CMREI offers basic to advanced level learning and applicable strategies for individuals with a desire to build cash flow and financial independence. CMREI believes that every investor has his or her own blue print for wealth building and Cherif is an expert in the game of financial architecture. For investment opportunities, education options, partnerships, or to find out more visit our website or join our Facebook page: ***To find out more visit*** http://www.GoCMREI.com ***Join Our Facebook Page*** https://www.facebook.com/cherif.medawar?fref=ts or Call the Office to Learn About Cherif's next Live Training (407) 608-5448 or [email protected]
Views: 359 Cherif Medawar
Invest with Origin: http://bit.ly/2PSCx3k Learn the various ways value-added real estate investment properties can be evaluated. About Origin Investments: Investing in commercial real estate can seem complicated and overwhelming. But for individuals willing to take the time and effort to learn how to navigate this market, it can be incredibly rewarding. At Origin, we’re dedicated to educating individuals so they can make smarter real estate investing decisions. Our blog has become a valuable industry resource with hundreds of articles to choose from and our newsletter delivers real estate investing education to inboxes twice a month. Origin Investments is also transforming the way individuals invest in real estate. We’re a Chicago-based real estate investment firm who acquires and operates value-added office and multi-family properties in eight fast-growing markets in the U.S. We invest side-by-side with investors, adhere to a disciplined investment philosophy and use technology to make it easy to manage investments. Origin’s investment platform is available to accredited investors who share their values and want to invest alongside an experienced manager with more than $700 million in assets under management. Our first two funds are averaging a 24% Net return to investors and have achieved top quartile performance, per Preqin data, and we recently raised $151 million for Origin Fund III.
Views: 580 Origin Investments
How to find right property value in India? This property valuation method can be used to detect whether a property is overvalued or under-priced, whether it is cheaper to buy a property or to rent a property in India at any given point in time. Use this rental yield or rental returns method to detect real estate bubble, when you plan to buy a residential property or commercial property in India. Related Videos: Rent or Buy a House? - https://youtu.be/x2lZbfTJ6t8 Share this Video: https://youtu.be/s07DmmtNphg इंडिया में सही वैल्यू की प्रॉपर्टी कैसे ढूंढें? इस प्रॉपर्टी वैल्यूएशन मेथड का इस्तेमाल ये पता लगाने के लिए किया जा सकता है कि किसी संपत्ति को ओवरवैल्यूड या अंडर-प्रिज़्ड रखा गया है, चाहे फि किसी प्रॉपर्टी को खरीदना सस्ता हो या कभी इंडिया में कोई प्रॉपर्टी किराए पर लेना हो। जब भी आप रेजिडेंशियल प्रॉपर्टी या कमर्शियल प्रॉपर्टी खरीदने के बारे में सोचते हैं तो इस रेंटल यील्ड या रेंटल रिटर्न्स मेथड का इस्तेमाल करके आप रियल एस्टेट बबल के का पता लगा सकते हैं। Subscribe To Our Channel and Get More Finance Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g To access more learning resources on finance, check out www.assetyogi.com In this video, we have explained: How to know the exact value of a property in India? How to detect real estate bubble in India? How to recognize if the property you are buying is overvalued or undervalued? How to use rental yield property valuation method to evaluate the value of a property in India? How to detect real estate bubble using rental returns method? How to use property valuation method to make property buying decision? Rental yields property valuation method can be used for evaluation of both commercial and residential property, if you are in a dilemma whether to buy a specific property in any specific location then you can use the rental returns of the properties located in that specific area to make sure you are getting the right property value for your investment. Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Google Plus – https://plus.google.com/+assetyogi-ay Twitter - http://twitter.com/assetyogi Facebook – https://www.facebook.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Instagram - http://instagram.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Hope you liked this video about “Right Property Value in Indian Real Estate”
Views: 36071 Asset Yogi
https://www.mansardcre.com Two brothers retiring from their business hired me to sell their commercial property. We could have valued the property based on the way they used it, assuming that a new owner would want to use it for a similar purpose. But if we had stopped there, these two brothers would have left a lot of money on the table. The town where the property was located was about to announce a new zoning overlay that would change the allowed use for the building. When we priced the property under the new zoning and offered it to the market, buyers paid 36% more for the opportunity. When you choose MANSARD, you can be sure that your valuation will reflect the full potential of your property.
With the market performing strong and prices high, now may be a good time to sell your commercial property. Join Michael Bull for tips and strategies, from getting an appraisal to picking the best agent to sell your property. For more information contact Michael Bull, CCIM 404-876-1640 x 101 or visit http://www.BullRealty.com Looking for tips as an agent? Visit http://www.CommercialAgentSuccess.com Appreciate the video? The best thank you is to check out our sponsors. See if they might be of value to you, or your referrals. http://commercialrealestateshow.com/c... Don’t miss a show of special interest to you, subscribe to our weekly show topic email notification. You’ll know who’s on the show and what it’s about. http://bit.ly/2gfoKSN You’re invited to subscribe to the show’s YouTube channel. http://www.youtube.com/subscription_c... For more videos, podcasts, and articles, visit http://www.CREshow.com
Views: 2607 America's Commercial Real Estate Show
This video explains how by releasing space from within the walls, you could be unlocking investment potential in terms of rental income. The usable space within a building is a fundamental metric in understanding the valuation, thus the investment potential, of real estate. Property with greater internal floor area commands a higher rental return in addition to a higher overall financial value. Insulation can add width to external walls, which takes up internal floor space. Space that could be used to generate additional rental income. Space that can be valuable in commercial real estate. So imagine if you could reduce the width of the walls of your building, without compromising the overall designed footprint, to release space and unlock the full investment potential for you or your client… Kingspan Kooltherm wall insulation solutions deliver superior thermal performance with a thinner profile. Kingspan Insulation asked Sweett Group to look into the Return on Investment (ROI) from specifying Kingspan Kooltherm wall insulation solutions versus comparative insulation solutions.
Views: 814 Kingspan Insulation UK
http://www.simpsonmillar.co.uk/services/property/commercial-property-solicitors.aspx - My name is Deborah Powell and I head the firms commercial property team here at Simpson Millar. At Simpson Millar we pride ourselves on our commercial hands on approach to commercial property work. We aim to provide clear commercial advice at competitive rates with transactions been delivered on time and within budget. We realise that often in commercial property transactions the underlying objective can get lost along the way and unless the transaction is pro-actively managed it can get over complicated, lengthy with resulting increases in both budget and timescales. We are committed to cutting through this process by providing focused cost effective advice with close Partner involvement at all times. Our specialist team of lawyers can deal with a wide of areas including; acquisition and development work, commercial leases, housing associations, licensed premises, pension funds, preparing environmental issues, property finance and construction advice. I have acted for landlords and Ive acted for tenants on all sorts of leasehold property matters for a long time and Ive got 20 years worth of experience for acting for all sorts of clients, big Plcs right down to Mrs Jones taking a lease of a butchers shops and I have acted on both sides of transactions so I know the issues from both sides really. The main things we are trying to sell at Simpson Millar is the fact that you dont have to pay through the nose to get good quality legal advice and quite often at the bigger firms you can end up paying an awful lot of money for a junior lawyer to give you not very commercial advice whereas if you come to a smaller firm, the overheads are less, you get charged less but you also get good quality commercial advice from a Partner with 20 years worth of experience. Things that are key at the moment in this market are advising on purchase contracts eg can you get out of them, can you stop someone getting out of them, looking at leases to see whether or not you are been overcharged on service charge, also looking at property portfolios generally to make sure that properties that you have got rid of that have been leasehold that there are no nasty skeletons hiding in the closet, because basically once you have a leasehold property if you get rid of it, even if you assign it across or even underlet it they have a nasty habit of coming back to you in the future and a lot of people dont realise that they thought they had got rid of that problem but in fact the lease is still existing, the tenant has gone bust and the landlord is now coming back to you to ask you to pay the rent so we can look at your portfolio and work out how many of those properties you have got in your portfolio and assess what the risk of those properties coming back to haunt you is. We also advise on claw back provisions in those contracts, onerous conditions and planning conditions. We have acted for an awful lot of clients, different clients and different needs and we have a lot of skill in advising those clients. Get in touch today and find out how we can help you on: Freephone: 0808 129 3320 or drop us an email [email protected] Calls to 0844 numbers will cost 7p per minute plus your telephone company's access charge.
Views: 615 Simpson Millar LLP Solicitors
Real estate valuation can be a bit of a science. When determining the value of commercial property, in fact, all types of real estate there are 4 main determinants. The 4 main items that determine property value are 1. Adaptability. Market conditions are always changing what is popular today may not be popular tomorrow. The better the property can adapt to other uses the better the value and security of income 2. Rarety. Are there similar properties around? Supply for demand forces has an affect on value 3. Transferability. There must be clear title. There may be legal problems when the time comes to sell if you cannot clearly define title. 4. Demand. Is your investment In a popular high demand area. The more available qualified tenants the more rent you can charge. For more our new FREE (for a limited time) E-BOOK and the real estate information you need now...... visit our web site - www.BusinessRealEstatetoday.com
Views: 100 Business Real Estate Today
https://www.msrholdings.com/ If you’re an investor interested in commercial real estate, then Capitalization Rate – or “Cap Rate” as it’s usually known – is one of the most integral concepts to understand. Understanding the Cap Rate equation, and how it can work to provide you with the best return on investment, will help you make smart investment choices. The Cap Rate equation has three components: - Cap Rate: Used to estimate an investor’s potential value on a real estate investment. - Net Operating Income: Annual income the property generates. This involves rent from tenants, less any operating expenses such as maintenance and taxes. - Value or Purchase Price: How much the property is worth in current market conditions. NOI, Value, and Cap Rate control how much return on your investment you will get. Watch this video, where we explain the Cap Rate equation in detail and give examples of how the different elements can affect long-term ROI.
Views: 3397 DMCC Holdings Inc.
Appreciate the video? The best thank you is to check out our sponsors. See if they might be of value to you, or your referrals. http://commercialrealestateshow.com/c... Don’t miss a show of special interest to you, subscribe to our weekly show topic email notification. You’ll know who’s on the show and what it’s about. http://bit.ly/2gfoKSN You’re invited to subscribe to the show’s YouTube channel. http://www.youtube.com/subscription_c... For more videos, podcasts, and articles, visit http://www.CREshow.com
Views: 94 America's Commercial Real Estate Show
Net Present Value Determining what Discount Rate to use A major difficulty with using Net Present Values in order to make investment decisions is determining what discount rate to use in the calculations. Theoretically, the proper discount rate is the rate at which alternative investments may be made. Thus, if a savings account is the investor's alternative, the six percent discount rate currently offered by the bank may be appropriate. Other investors may feel that they have different alternatives, however. For this reason, the individual investor's discount rate is an assumption in the analysis so that it may be varied for each investor. This difficulty in determining the proper discount rate is eliminated, however, when the investor uses the Internal Rate of Return to evaluate the investment. Net Present Value NPV Considers: All assumptions entered such as: Scheduled Income, Purchase Price, Down Payment, Current Debt Payment, Vacancies, Expenses, Property Taxes, Lease terms, Revenue Growth, Rent Control, Expense Growth, Property Tax Growth, Deferred Maintenance, Debt Amount (Ratio), Interest Rate, Interest Rate Changes, Payment Changes, Points, Prepayment Penalties, Depreciation, Capital Expenditures, Income Taxes, $25,000 Exemption, Passive Losses, Appreciation, Capital Gains Tax ... and all other entered assumptions Net Present Value NPV Ignores: Only assumptions not entered Why is Net Present Value NPV useful? NPV is the foundation of the discounted cash flow (DCF) process. With NPV you enter a discount rate which is the yield you would like to get. The NPV is the amount you need to adjust the beginning amount (ie purchase) by to equal that yield. The nature of the NPV is that it takes everything into account that made up the cash flow. The only weakness is that it is hard to calculate (not with planEASe of course), and that it uses all the assumption values (so, in turn, you are required to enter these assumptions, which means more work on your part).
Views: 1856 planease
Discover why refinancing is so important, including how it can increase cash flow and cash on cash returns. Plus, you can pull out tax-free cash. You'll also learn the secrets behind refinancing that every commercial real estate investor should know.
Views: 19687 Commercial Property Advisors
The Commercial Real Estate valuation model uses Discounted Cash Flow (DCF) analysis to determine the value of a commercial property. The model builds rent roll and the cash flow forecast which then are discounted to determine the value of the property. The real estate valuation model also checks the valuation by reviewing the unlevered and levered yields an investor gets when buying into this valuation. Furthermore also Income Statement, Balance Sheet and Cash Flow Statement are projected for the property company. The model is available here https://www.efinancialmodels.com/downloads/commercial-real-estate-valuation-model-16488/
Views: 338 eFinancial Models
Created for business leaders in the community, the Commercial Property Value Forecast Model is intended as a resource to make accurate forecasts, specifically as it relates to commercial property values.
Views: 140 uofcincinnati
"The Due Diligence Handbook For Commercial Real Estate: A Proven System To Save Time, Money, Headaches And Create Value When Buying Commercial Real Estate" by Brian Hennessey
Views: 4517 Impact Coaching Systems
In our latest video Jonathan Main, Partner and Joe Sullivan, Partner discuss the aspects of VAT that affect the construction and real estate sector. This video covers the following; - Summarising commercial property - What are some of the principles of VAT relating to commercial property? - Whether or not to charge VAT on the rent on commercial properties - Option to tax - Transfers as a going concern - Do we want to recover VAT on construction cost going forward and if so, can we charge VAT to our tenants? - Commercial considerations that may affect the bottom line - The latest legislation regarding fraud --------------------------------------------- MHA Moore & Smalley links Website: http://www.mooreandsmalley.co.uk/ Twitter: https://twitter.com/MooreandSmalley LinkedIn: https://www.linkedin.com/company/mha-moore-and-smalley
Views: 221 Moore & Smalley TV
Discover the 5 Best Commercial Real Estate Types for Individual Investors from Peter Harris of CommercialPropertyAdvisors.com. Learn more at: http://www.commercialpropertyadvisors.com/5-best-commercial-real-estate-types/
Views: 94214 Commercial Property Advisors
Loan Balance/Property Value is calculated by: Loan Balance divide Projected Sale Value equals the Loan Balance/Property Value Considers:Sale Value and Loan Balance Ignores: Time Value of Money, Sale Proceeds, All Financing (Loans), Other Years NOI, All Taxes ... and a lot of other things Why is Loan Balance/Property Value useful? Loan Balance/Property Value is the Loan Repayment amount divided by the Sale Value (both measured at the beginning of the year). This ratio measures the margin of safety for the lender's principal. This can also be an important number if you are planning to refinance. What is the Loan Balance/Property Value Sensitive to: Sale Value and Loan Balance
Views: 67 planease
www.propertyinvestment.co.uk The UK Commercial Sector is attracting renewed interest as a result of substantial price falls over the past few years. Real value has returned to the UK commercial market enabling investors to snap up attractively priced assets. The relative weakness to the pound adds further value to non UK based buyers. The benefits of investing in UK commercial property such as long term rental income and tax incentives remain compelling when compared with other asset types. We advise on UK commercial property from under one million, to several million pounds. We act on behalf of clients ranging from private investors to large corporations. We are often approached to build portfolios which are sector and value specific. Many of the commercial properties that we advise on do not appear on our website. Some of our overseas clients who wish to build their UK commercial property portfolio prefer us to travel for face to face advice. In many cases communication by telephone and email suffices. Whatever your needs, why not call us today to discuss how we may be able to assist you in benefiting from the UK Commercial Property market.
Views: 707 PropertyInvestmentUK
Distressed Commercial Property can make you a multi-millionaire on just one good deal. In this video, you'll discover the physical, financial and legal characteristics that make commercial real estate distressed and how you can buy distressed properties for profit. You'll learn how to locate them, finance them and design the right exit strategies.
Views: 32106 Commercial Property Advisors
https://www.commercialpropertyadvisors.com/buying-your-first-multi-family-small-apartment-building/ Discover how to buy your first multi family small apartment building, step by step. Don't get caught up in the "bigger is better" mentality. Instead, you'll find that the smaller deals can be the most profitable. This is a great video for anyone interested is getting started with Commercial Real Estate investing.
Views: 798005 Commercial Property Advisors
Stay knowledgeable by subscribing! http://bit.ly/iLiveInTheBayArea Visit my site for even more information: http://www.iLiveInTheBayArea.com Like me on Facebook: http://www.fb.com/iLiveInTheBayArea Net Present Value -- or NPV -- means to convert all the future cash flows into today's dollars, but even that doesn't tell the whole story. Determining your NPV isn't the easiest thing in the world. But, don't confuse the fact that it is a bit tricky to understand with the fact that it is one of the most sought after methods by investors in determining what a property is worth to them...now that's good to know.
Views: 16970 Davide Pio - CCIM, LEED AP