Smart Real Estate Investing in 2018

2 years ago 0 0 882

It’s a new year, and we’re moving full steam ahead. It’s a great time to check in with current real estate trends and events shaping this year’s market and then decide how you will respond to them to meet your 2018 investment objectives. Current Real Estate Market Trends Money Chasing Deals: It will come as no surprise that demand for real estate still far exceeds supply. This results in peak prices, which equals lower yields, and makes it increasingly more difficult to “win” deals. Risk/Potential: With the market peaking, there is more downside risk and less upside potential. Hesitation: Current owners are hesitant to sell because opportunities to reinvest their money at acceptable returns just do not exist. Low Prices: Prices per square foot on existing properties seem low compared to replacement costs. Core Investment: Institutional investors now consider real estate a core investment, thus eliminating the need for a

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More Questions Than Answers: A 2016 Forecast for Atlanta Commercial Real Estate

4 years ago 0 0 1557

Trouble in China. Falling oil prices. Unsteady stock market. Slow employment growth. Stagnant incomes. That’s a heck of a way to start a new year, isn’t it? In the real estate universe, an abundance of capital and cheap financing have once again pushed prices up to record levels. My friends in the capital markets tell me that investment activity flattened toward the end of last year, as both investors and lenders became more cautious. Do these macro events portend the end of the slow—if resilient—economic recovery? How will Atlanta be affected? So far, Atlanta’s commercial real estate market has performed well during this recovery. Led by multi-family development, occupancy and rental rates have both been ticking up. In 2015, new construction has increased in all sectors. Will this continue in 2016? For my part, I have a few questions (and a few predictions) about how things will shake out over

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Cutting Through the Brokerspeak

4 years ago 0 0 1880

If you’ve ever bought a house, you’ve heard some of the code words residential real estate agents put in their listings. That “contemporary design” may just be ugly as sin. The “convenient location” could be because you get stuck in rush-hour traffic within a quarter mile of the driveway. And don’t even start thinking about “open concept.” Commercial brokers have their own language as well, and it can lead the uninformed or unsophisticated buyer to overpay. For the uninitiated, it may take a while to pick it up on this language. But once you’ve heard the same phrases ad nauseam, it can be easy to get cynical about brokerspeak. Below are five of the most commonly abused phrases, along with the cynic’s interpretation. And, on a more serious note, what you really ought to think about when you see these phrases in a marketing package.   Below replacement cost! The

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Sell high? Not so fast!

5 years ago 0 0 2107

One of the truisms of investing is that you should always sell high — in other words, when the market is at its peak. With values for commercial properties approaching, and in some cases surpassing, “all time highs,” one might argue for aggressive selling. Not so fast! Pause, take a breath, and consider the following decision pathway: 1.    A primary consideration should be “What will you do with the money from the sale?” In this market, virtually all asset classes are very expensive, and cash is yielding close to nothing. This leads to question #2… 2.    If the current property is financially sound and producing a good return, why replace it for another? Unless… 3.    If the current property is not performing well, no longer meets your objectives, has changed fundamentally, or has fulfilled the objectives for which it was purchased, it may be time to sell. 4.    Are the

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Six Wealth-Building Real Estate Resolutions for 2015

5 years ago 0 0 1934

You might be surprised to know how many commercial real estate purchases are driven more by emotional than rational decision making. With the real estate and stock markets being white-hot and returns on conservative alternatives near zero, it is tempting and easy to throw caution to the wind. Beware if you dare. If you’re considering a real estate investment in 2015, here are Six Wealth-Building Real Estate Resolutions to ensure that rational thinking prevails. 1. Neighborhood trends matter. Google earth doesn’t tell the entire story. A site visit is worth the time and expense. Also, engage a professional familiar with the property type and local market to provide an objective assessment that will reveal opportunities and potential problems associated with planned rezoning, future developments, transportation changes, or market trends. 2. Physical condition of property Get an inspection! Hidden conditions can be very costly. A pound of prevention…well, you know. 3.

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