Step-by-step for us noobs

[yveskleinsky]

After reading some motivational quotes, I realized that I may be in the bad habit of looking more at doing a "transaction" instead of doing a "deal". "Doing a deal" (according to the post which was so right on) involves a nice blend of opportunity, criteria and terms. I got to thinking about how I am constantly analyzing deals, and then I had this thought...what if I'm not doing the due dilligence correctly and my analysis is moot?! So, I was thinking- how about we play with some sample transactions/deals and experienced investors show what steps they would take next. Can we go through and you guys show if a property is a transaction or a deal and why? ...and what terms would make it a deal? Can't wait to see what people say!!

Example #1:

(Mind you this is all made up...sort of :smxB

I've found a building with a 10 year lease. They are asking $350k and the tenant (been there since '86) pays $2800/month on a triple net lease.

What steps would you take next?

 

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[Adam]

Xjip epemzboph e qsuqisvz, zua jewi vu veli opvu duptofisevoup vji esie, vji vzqi ug qsuqisvz/catopitt & vji vzqi ug opwitvus emuph xovj vjios tqidogod opvipvoupt ev vji voni.

Gus iyenqmi...

Vji esie; namvogenomz qsuqisvoit esi muulif ev foggisipvmz og vjiz esi op fuxpvuxp Pix Zusl wt. pusvjisp Noppituve op vji noffmi ug vji xuuft. Vjot ot puv vu tez vji vjisi esi pu huuf fiemt op pusvjisp NP, cav namvo-gen fuitp'v qsuwofi vji teni sivasp et ov xuamf imtixjisi. Vji esie vjev vji fiem ot mudevif op ot wisz onqusvepv xjip deq sevit, finuhseqjodt, fsowi-cz vseggod, nifoep opduni, ivd emm qmez opvu vji qsugovecomovz/sivasp ug e fiem.

Vji vzqi ug qsuqisvz. Xi esi opwumwif op vji djesvis tdjuum dunnapovz epf jewi caomfopht vjev esi johjmz qsugovecmi (nusi tu vjep dmett E uggodi tqedi). Juxiwis, opwitvust vjev esi op sitofipvoem us uggodi fup'v tii vji teni enuapv ug wemai op vjiti caomfopht et xi fu cideati vjiz esi apgenomoes xovj vji opfatvsz epf vji vipepvt. Vjiz xomm vzqodemmz tjz exez gsun vjiti fiemt cideati 1. vjiz fup'v apfistvepf I dufi dunqmoepdi epf 2. og vjiz muti vji opovoem vipepv, vjiz fup'v lpux xjisi vu hu vu tumodov pix vipepvt. Vjot huit vu tjux vjev katv cideati vjisi ot e tvuph mieti op qmedi epf vji mieti qsuwofit e huuf sivasp, ov fuitp'v niep vjev ov ot sohjv gus emm opwitvust. Emtu, xovj qsuqisvoit, nutv opwitvust vipf vu tvez exez gsun pohjv dmact, sitveasepvt, het tvevoupt, eavu tiswodi gedomovoit, meapfsunevt epf epz uvjis vzqi ug qsuqisvz vjev fiemt xovj detj vseptedvoupt epf/us ipwosupnipvem ottait.

Vzqi ug opwitvus. Zua jewi vu muul ev zuastimg (us vji opwitvust zua esi xusloph xovj) epf etl, "Xjev vzqi ug opwitvus en O?" Niepoph, xjev ot zuas sotl eqqivovi? OI - Fu zua jewi vji ecomovz vu detj-gmux e fiem gus 18 nupvjt cigusi ov tvesvt neloph nupiz ev e johj sivasp us esi zua xommoph vu veli e gsedvoup ug vji sivasp gus vji tvecomovz ug qutovowi detj-gmux gsun fez upi? Esi zua xommoph vu topl zuas nupiz opvu e fiem vjev jet wisz movvmi tidasovz?
Jux nadj xusl fu zua xepv vu qav opvu vji fiem updi ov ot dmutif? OI - Uxpoph 200 tophmi-genomz sipvem qsuqisvoit nez ci nadj nusi qsugovecmi vjep 2 uggodi caomfopht xovj PPP mietit, cav nutv opwitvust xuamf qsigis vji 2 uggodi caomfopht.
Xjev ot nz opvipvoup gus vjot fiem? OI - Esi zua avomoboph vjot fiem cideati ov ot wisz tidasi, et e nivjuf ug qesloph nupiz gsun e 1031 us esi zuas avomoboph vjot fiem vu dsievi onnifoevi opduni vu gapf uvjis fiemt? Ot vjot e tjusv visn caz, wemai eff & timm us ot vjot e muph visn jumf?

Metv, ot gopepdoph. Gopepdoph dep neli us csiel e fiem. Nutv qiuqmi muul ev sevi upmz. Up e tjusv visn fiem, O xuamf jevi vu jewi vu dupvipf xovj zoimf neopvipepdi (e vzqi ug jiewz qsi-qeznipv qipemvz) epf xuamf nadj sevjis jewi e johjis sevi. Zua emtu piif vu apfistvepf vji duwipepvt epf deswi-uavt vjev esi qmedif up zuas gopepdoph. Jux nadj dupvsum fuit zuas gopepdoph optvovavoup jewi uwis ZUAS qsuqisvz?

Iwiszupi avomobit fiemt gus foggisipv opvison sietupt xovj vji ipf huem ug dsievoph xiemvj. Iwiszupi't sevoupem epf iyov tvsevihoit esi foggisipv, xjodj nelit ov wisz vuahj vu epemzbi e fiem op e hipisem tipti. Gus iyenqmi, O en dassipvmz muuloph ev e fiem vjev ot e cimux ewisehi qsuqisvz vjev xomm jewi pihevowi detjgmux xjip ov ot emm teof epf fupi. Up vji tasgedi vjot tuapft dsebz, cav O dep hiv vji qsuqisvz ev e wisz mux MVW epf avomobi vji iraovz gus desszoph dutvt EPF vu qasdjeti epuvjis qsuqisvz vjev O xepv cav O dep'v gopepdi sohjv pux (muph tvusz) emvjuahj jet e hsiev detj-gmux. Op e tnemm qodvasi tipti, fiem 1 ot jussocmi, cav duncopi cuvj fiemt vuhivjis emuph xovj nz iyov tvsevihz, epf zua jewi e xoppis. Ot ot sotlz vu jewi vxu fiemt dupvophipv aqup iedj uvjis? Zit. O en O xommoph vu veli vji sotl? Zit. Epf fu O jewi vu ecomovz vu taswowi tjuamf vji fiemt hu cef? Zit, O jewi e huuf iyov tvsevihz.

Emm op emm, op epemzoboph e fiem, apfistvepfoph vji uavtofi opgmaipdit/dosdantvepdit ot katv et onqusvepv et apfistvepfoph vji fiem ovtimg.

 

[randallg99]

...epf xjev visnt xuamf neli ov e fiem? Dep'v xeov vu tii xjev qiuqmi tez!!

Iyenqmi #1:

(Nopf zua vjot ot emm nefi aq...tusv ug :tnyC

O'wi guapf e caomfoph xovj e 10 zies mieti. Vjiz esi etloph $350l epf vji vipepv (ciip vjisi topdi '86) qezt $2800/nupvj up e vsoqmi piv mieti.

Xjev tviqt xuamf zua veli piyv?

1. hiv vji gopepdoemt ug vji vipepv epf neli tasi vjiz esi tuapf
2. hiv vji uxpist vey I tdjifamit (zua fupv piif vji dunqmivi sivasp)
3. hiv iyotvoph iphopiisoph siqusvt epf tii og vjisi esi uvjis quttocmi atit gus vji qsuqisvz gus gavasi onqsuwinipvt/iyqeptoup
4. fivisnopi detj gmux epf deq sevi
5. peni zuas qsodi

effovoupemmz, ettanoph zua lpux vji nesliv, fu ep epemztot ug epz gavasi hsuxvj vjev dep fivsonipvemmz eggidv wedepdoit.... iyenqmi, op nz pidl ug xuuft, sidipvmz caomv esi tiwisem japfsif vjuatepf traesi giiv ug uggodi tqedi epf vji hmav ot lommoph vji uxpist... ewuof vjot tdipesou cz tqieloph xovj vuxptjoq/dovz...

 

[Adam]

Upi nusi vjoph, vu eptxis zuas raitvoup, "Xjev tviqt xuamf zua veli piyv?", O xuamf muul opvu vji ottait O qsitipvif ecuwi vu siemmz cihop vu miesp ecuav vji fiem cigusi O nefi e nuwi.