307. Non-Negotiables Analyzing Commercial Deals | Office Hours

Key Takeaways:

Location Matters: Choose a location that fits your specific investment strategy and asset class.

Cash Flow is Critical: Aim for properties that can cover debt service, especially in the current interest rate environment.

Environmental Due Diligence: Always conduct a phase one environmental report to identify potential contamination risks.

Property Age Considerations: Older properties can have expensive maintenance issues, particularly with plumbing, HVAC, and infrastructure.

Zoning Verification: Always double-check zoning with the city, as local tax maps can be inaccurate.

Parking and Accessibility: Evaluate parking needs based on the specific market and neighborhood.

Surrounding Neighborhood: Assess the condition of nearby properties and potential for future development.

Tenant Compatibility: Consider how surrounding businesses and potential tenants align with the property's intended use.

Feasibility Study: Do quick initial calculations to determine if a deal is worth pursuing further (e.g., price per square foot, potential rental rates).

Investment Strategy: Look for opportunities to potentially double your money in 3-5 years through a combination of cash flow and appreciation.