I need some advise and input about purchasing of free stand building with a long term franchise tenant.

In Buying Property - Asked by ELIAN M. - Nov 22, 2015
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Answer(s)

Jay S.
Broker/Agent
Norfolk, VA

I'd be happy to help. What questions do you have?

Nov 23, 2015
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Moustafa E.
San Jose, CA

The best and only advise can be is Please do yourself a favor and higher a professional broker.
By all mean's it pays to higher a professional.
Investment in Real Estate it is all about being a proactive, this if you want to ensure you are not losing. Passive investment is the way to great damage.
I don't want to give you big list but here an example for what you will do if have on of the Chipotle closing now.
It need more then just luck, it need research and analysis and most of all expertise.
It is either way you would not be saving anything hiring the best broker.
In my opinion the right question should be.
What I should look in a good Commercial broker.
Best of luck

Nov 23, 2015
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Moustafa E.
San Jose, CA

The best and only advise can be is Please do yourself a favor and higher a professional broker.
By all mean's it pays to higher a professional.
Investment in Real Estate it is all about being a proactive, this if you want to ensure you are not losing. Passive investment is the way to great damage.
I don't want to give you big list but here an example for what you will do if have on of the Chipotle closing now.
It need more then just luck, it need research and analysis and most of all expertise.
It is either way you would not be saving anything hiring the best broker.
In my opinion the right question should be.
What I should look in a good Commercial broker.
Best of luck

Nov 23, 2015
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Cinny Z.
Broker/Agent
San Jose, CA

Happy Thanksgiving! I can give you very thorough explanation of pros and cons of this type of investment. Feel free to contact me. or email me: cinnyzhuang@gmail.com
(408)666-9956.

Nov 24, 2015
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william r.
Lender/Mortgage Broker
Bartlett, IL

Several different ways to go. We can bypass the middle man in most circumstances. Give me an email so we can discuss further. wrogala99@comcast.net Bill R

Nov 26, 2015
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Frank A J.
Broker/Agent
Salvo, NC

This is generally a good investment if priced right for your ROI (return on investment). A lot depends on cost and lease terms and conditions. Best to hire a professional broker in the area you select.

Nov 26, 2015
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Ronald S.
Broker/Agent
Orland Park, IL

If you need any help in locating a single tenant, net leased, stand alone property and are interested in Illinois, Indiana, Florida or Wisconsin, please let me know. Ron Stewart, Broker, run1ron@aol.com, 708-870-2920.
Let me know what your target return rate is and what kind of risk you are willing to take.

Nov 27, 2015
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Arthur P.
Broker/Agent
Northridge, CA

I am Happy to provide answers. Please forward me your phone number and the best time we may speak.
Contact me at art@pfeffermancre.com or 818 516 0257 (text or call)
Art Pfefferman
Senior Managing Director
COLDWELL BANKER COMMERCIAL QUALITY PROPERTIES

Nov 29, 2015
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Barry B.
Broker/Agent
Oceanside, CA

Hi Elain,
You may have already gone into escrow on your purchase, but when purchasing a free standing building with a franchise tenant there are several things to check out. Most of them are obvious.
1. The most important is the CAP rate. That is the rough rate of return. It is calculated by dividing the net income by the purchase price. Franchisee properties like McDonalds offer very low CAP rates usually around 4.5%. A primary, high demand, market can also influence CAP rate. So if you are looking for a high CAP rate you may need to go to a secondary market with a "lesser" brand name.
2. Who is the franchisee? Is the franchisee a corporation with a corporate guarantee or is it a "mom and pop" single unit operator? This will effect the risk and CAP rate.
3.is the free standing building at a signalized intersection or mid block? Does it have a drive-thru?
4. How long is the lease? If short term the CAP rate should be higher.
5. What is the market area like? If the tenant fails or moves when the lease is up, how easy will it be to re-rent the building. I have seen some properties where the rent is way to high for the market so if the building goes vacant to re-rent it one would have to offer it at a much lower rent, thereby reducing the CAP rate and value.
6. Finally, how strong and well known is the franchise?
7. All of these need to be taken into account to come up with the right mix for your investment portfolio depending on the amount of risk you are willing to take and your long term investment goals.
I hope this helped, If you need any other information, and you are not already working with a real estate agent, feel free to contact me.
Barry

Dec 12, 2015
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Michael E.
Broker/Agent
Houston, TX

We currently have a freestanding building with a national credit tenant here in Houston, Texas. If you would like more information on the property, please don't hesitate to contact me. I look forward to hearing from you.

Dec 21, 2015
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