Rob Cassam's Commercial Leasing-Purchase Blog

How Is Commercial Real Estate Really Performing?

On 01.11.10, In Trends, By Rob

Integra Realty Resources has released their preeminent 2010 real estate economic forecast publication, IRR-Viewpoint. This marks the 20th year our publication has been providing information pertaining to economic growth, capitalization rates, discount rates, and market-by-market value trends for major investment grade real estate.

Highlights of this year’s study include:
- Extensive data about the local and national market conditions for multifamily, office, retail, and industrial property types.

- Special sections on lodging, gaming, seniors housing, green buildings, and self storage sectors.

- A summary of the Mexican and Canadian real estate markets.
Overview of demographic and economic trends and how they affect the real estate market.

This year’s Viewpoint was compiled by our real estate experts from 59 offices across the country. With over 850 analysts and staff nationwide, 160 of whom hold MAI designations, Integra offers local expertise – nationally to provide you with invaluable insights in the future real estate market. Click Here to get your copy.

Please remember this is CORPORATE INVESTMENT grade real estate meaning the study was based upon large commercial transactions. It can be a useful indicator for smaller property owners.

Tagged with: Commercial Property Trends

Costly Mistakes To Avoid When Moving

On 01.11.10, In Tenant Tips, By Rob

Unfortunately many people find out far too late that there is more to moving a company than just calling a mover and setting a date. They are overwhelmed with the details and steps required. According to a survey of 231 law firms relocating to new office space, the biggest problems they had to deal with were:

Insufficient planning 52%

Selecting vendors 37%

Cooperation, teamwork and morale 29%

Disposal of obsolete files 21%

Forgetting important tasks 19%

Keeping within the budget and schedule 11%

Matching files to offices 10%

A Relocation Management study revealed almost two-thirds of the people responsible for the relocation of their company were either fired or demoted after the move. Other took time off for stress related ailments.

So how can these mistakes be avoided? They can be avoided by setting up a process and first asking the following:

Who is in charge? From the start decide who is responsible for the move. Even if you have a move committee, someone will always have to make the final decision.

Start planning early- Henry Ford said, Before everything else, getting ready is the secret of success.

Get the word out- The company rumor mill can impair morale. People in general, fear change and uncertainty. Tell people what is going on, and how it will impact them. You will be surprised at what they will tolerate and how much they will help out if informed.

Focus on the details- If you do not know what the details may be, then find out.

Allow enough time- Take in to account Murphys Law and things always take longer than planned. Make sure you have cushion in your schedule for delays.

Use checklists- A small company must consider a hundred or more activities; a large company upwards of a thousand. There are just too many things to remember. Use checklists to help assign, organize and track your progress.

Finally, a good tenant broker or buyers broker should be able to assist you in getting resources together for the move including the checklists!

Tagged with: Relocation

How To REALLY Save Thousands of Dollars On Your Commercial Real Estate

On 12.10.09, In Tenant Tips, By Rob

If you have real property with costs of $500,000 or more, purchased after 1986, you may be missing an opportunity for substantial tax savings!

Do you own depreciable real property?
Are you constructing or purchasing real property?
Are you expanding your existing facility?
Do you have extensive leasehold improvements?

If you answer “yes” to any one of these questions, there is a service that I provide that could save you a significant amount of taxes! The service I am speaking of is a Cost Segregation Study.

This is a little known process designed to legally recapture thousands of dollars using a qualified professional to perform this special study.

What is a cost segregation study and what is it worth? A cost segregation study is an analysis, using an engineering approach acceptable to the Internal Revenue Service, to reclassify costs from the long depreciation lives of 27, 31 and 39 years to 5, 7 and 15 years. The benefit of a study is the net present value of tax savings generated as a result of accelerating depreciation expense. This amount can be significant meaning tens of thousands of dollars in many cases.

Studies are done not only for property being currently purchased or constructed or improved, but also for buildings placed in service as early as 1987. Taxpayers can reclassify costs that qualified for shorter lives and can “catch-up” those missed deductions immediately. You don’t have to spread the missed deductions over four years anymore. As you can imagine, these amounts are usually quite large and result in big tax savings.

The Internal Revenue Service has made it clear, through various rulings, procedures and court cases, that they will not accept anything less than a Cost Segregation Study using a construction and an engineering approach. My study is comprehensive and well documented and in the format acceptable to the Internal Revenue Service.

By Richard A. Blum, CPA, JD, LL.M.

Please call Mr. Blum directly at (704) 770-8790 (704) 770-8790 or e-mail at Rblum@carolina.rr.com if you would like to further discuss these cost segregation studies or if you have any questions.

Tagged with: Cost Segreation

How To Avoid Common Tenant Mistakes When Leasing Commercial Real Estate

On 12.02.09, In Tenant Tips, By Rob

Tagged with: Leasing • Tenant Representation

How Do You Know If Your Landlord Is Paying His Bills?

On 11.16.09, In Tenant Tips, By Rob

A question I am often asked with respect to leasing commercial property is how one can know if the landlord is paying his bills.

Think about it for a second, if the landlord fails to pay his mortgage, taxes, utility bills or any similar related expense, those vendors who have not been paid can (and will) take legal action. That action can be anything from foreclosure, to disconnection of services.

So what can a tenant do?

Enter a good real estate attorney. Assuming the tenant used a tenant rep broker to assist him with the transaction, that broker would have negotiated important lease terms in the form of a request for proposal and received a written answer. The mechanisms in that letter would state how the final lease should be prepared in order to protect that tenant.

Once the broker received the lease which was drawn using the business points negotiated in the request for proposal letter and it response, he would have made informal lease comments and incorporated them with the comments of the tenant. These comments are then given to the tenants real estate attorney for proper legal review and manipulation.

I have NEVER been through that process with a tenant where important lease terms did not need to be changed. It is at this point where the real estate attorney will ensure that the necessary protection is in that lease document prior to signing.

If the landlord will not accept these important changes, then the good tenant broker will have an alternative property to consider before making their final decision.

This process is important given the economic environment today. How bad would it be for the tenants business to get locked out of the property until payments can be brought current?

Tagged with: Leasing • Tenant Representation

Commercial Data Misses The Boat

On 11.16.09, In Tenant Tips, By Rob

One common misconception when it comes to commercial real estate data is it availability. Unlike residential property listing data, the commercial data remains fragmented with respect to aggregating it to the public.

Our local residential board recently signed agreements to aggregate its data to all of the major real estate portals around the Internet.

The local commercial database still does not contain all of the all of the available properties. Local brokers use approximately four different databases to post their information. The unfortunate fact is that some of these databases cannot be accessed by the public. Or if they can, not all of the information can be accessed.

It is unlikely that this trend will change any time soon in this market. Aside from the major benefits and value commercial brokers bring to their clients, access to data is still a big benefit unlike the residential side.

Any broker representing a tenant or buyer of commercial real estate must spend a lot of time compiling a complete list of properties, polling local commercial brokers for their data and cross checking their lists before presenting them to their client. This time commitment is among many reasons why good commercial brokers require written brokerage agreements prior to engaging in that effort.

It is worth while to review the agency types here in North Carolina and what can be expected by buyers and tenants. They are located here at the links below.

Working with agents-buy-sell

Working with agents-lease

If one takes the time to carefully review this and discuss this with a good broker, it is easy to see that it would be foolish to participate in the transaction (especially on the purchase or tenant side) without the assistance of a broker. In many cases, buyers and tenants end up paying nothing with the dust settles.

I suggest finding a buyer or tenant broker that you like in order to provide the valuable services.

Tagged with: Commercial MLS

Magazine Ranks N.C. Business Climate No. 1

On 11.04.09, In Uncategorized, By Rob

Site Selection magazine recently ranked North Carolina No. 1 in the country for its business climate, followed by Texas, Virginia, Ohio and Tennessee. The magazine cites new high-tech development and North Carolina’s technology-focused academic centers as strengths for business growth.
http://takeaction.realtoractioncenter.com/ct/tdLZIdY1ALAp/

Rob Cassam's Commercial Leasing-Purchase Blog

The Right Real Estate Advice Makes All The Difference!

How Is Commercial Real Estate Really Performing?

Costly Mistakes To Avoid When Moving

How To REALLY Save Thousands of Dollars On Your Commercial Real Estate

How To Avoid Common Tenant Mistakes When Leasing Commercial Real Estate

How Do You Know If Your Landlord Is Paying His Bills?

Commercial Data Misses The Boat

Magazine Ranks N.C. Business Climate No. 1

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