Comments (1)

By AZ Advisory Team, February 2, 2010 12:41 pm

The Commercial Real Estate Stack:

GPI
- V/C
= EGI
- OE
= NOI
- ADS
=CFBT

-T

=NI

NI1+NI2+NI3…..

- IC

= ROI

So here it is. There are other factors to be added to the equation as we try to evaluate what will help add value to the building and increase its revenue-producing potential in terms of upgrading to various energy, environmental and accessibility building standards as well as improving amenities.

Each element influences the equation and even a slight upgrade or an application of expertise will factor in to a decreased, for example, Operating Expenses, or decreased Taxes – contributing to a significant ROI.

This concludes this topic. Feel free to contact me for other commercial real estate investment topics you are interested in.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

Comments (2)

By AZ Advisory Team, February 1, 2010 12:36 pm

Continued…

Annual Debt Service (ADS)

The ADS is the total of loan payments for the year. The annual debt service includes the principal and interest portion of the payment for all twelve months.

Cash Flow Before Taxes (CFBT)

Cash Flow Before Taxes is the amount of money realized by the investor for the year, whether positive or negative, before income taxes are computed.

Taxes (T)

This is simply the taxes you pay in connection to your property.

Net Income (NI)

This is your Net Income for the year after paying taxes. This is the amount of money realized after the payment of taxes.

Investment Cost (IC)

Investment Cost is the total amount of money you released to purchase that property including the professional fees and other expenses associated with buying that commercial investment property.

Return on Investment

When your Net Income added yearly reaches to a point that it surpasses your Investment Cost, then you have reached a Return on Investment.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By AZ Advisory Team, January 26, 2010 6:08 pm

Purchasing ahead of the market’s bottom, as opposed to waiting for concrete signs of recovery, provides investors with the advantage of relatively limited competition. Resumption of job growth will draw more investors back into the market, and, while prices may soften further before stabilizing, they ultimately will pass through current levels at the start of the next appreciation cycle.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By AZ Advisory Team, January 21, 2010 8:17 pm

Commercial Real Estate – Office: First-time unemployment claims fell in December to their lowest point since the onset of the financial crisis in September 2008. In addition, only 11,000 jobs were lost in November, the lightest month of cuts since the recession began. Reductions were concentrated in the manufacturing, construction and information sectors and were almost offset by growth in healthcare and the professional and business services sector. The gain in professional and businesses services hiring was driven mostly by a surge in temporary staffing, which rose for the fourth consecutive month in November after a prolonged period of contraction. This trend suggests that staffing needs at many companies have begun to increase as a leading indicator of eventual payroll hiring when companies enter an expansion mode. The recession has claimed nearly 7.2 million jobs so far, including 4.1 million positions in 2009.

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By AZ Advisory Team, January 20, 2010 8:00 am

Commercial Real Estate – Office: Vacancy growth is slowing down and is expected to recover relatively quickly due to the limited construction of new offices during the recession.  Tight credit markets continue to hamper office investment activity but also restrict new development. The latter bodes well for office property owners in the next recovery cycle, building on the benefits of below-trend construction during the past several years. In 2010, less than 30 million square feet of new office space is slated for delivery, the lightest period for completions since the mid-1990s. Many projects have been deferred or abandoned in recent quarters, and the planning pipeline continues to thin due to weak office space demand and a lack of financing. As a result, owners of existing properties should have an extended opportunity to fill vacancies ahead of the next upturn in construction. This may even drive rents up when demand grows in the upturn against limited supply of offices.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By AZ Advisory Team, January 19, 2010 9:26 pm

Medical Office Investments: While fewer office sales were reported in 2009, medical properties accounted for roughly 25 percent of the total, up from 12 percent prior to the credit crunch. Despite deep office-using job losses in recent years, healthcare posted steady gains through the recession. The combination of aging baby boomers and potential healthcare reform will draw more investors to this segment in the near term. It is estimated that if 30 million uninsured gained coverage, as current legislation anticipates, the added demand would require approximately 59 million square feet of medical offi ce space beyond what is needed to satisfy normal demand trends. Cap rates in the medical offi ce sector have increased but not to the degree registered among traditional office assets, with the average of 8.5 percent up just 120 basis points from the low recorded in 2008.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By AZ Advisory Team, January 15, 2010 2:24 pm

Some huge deals have been done in recent weeks as highlighted by the Financial Times. Either previous commercial real estate crisis fears were overdone or these new investors are about to get creamed.  Success will probably all come down to the particular property in question.

A public sign of such activity came on Friday when Colony Capital won a Federal Deposit Insurance Corporation auction for $1bn of commercial property loans formerly held by failed banks in states hit hard by the real estate downturn. Earlier last week, SL Green, a real estate investment trust, said it had refinanced a Times Square tower it owns with Canada’s Caisse de Dépôt et Placement du Québec in a $475m deal ed by Bank of China. In December, JPMorgan Chase raised $625m for Inland Western, a real estate investment trust, of which $500m was in the form of securities backed by commercial real estate assets. The deal was particularly notable because it was done without help from the term asset-backed securities loan facility, or Talf, which was set up to provide financing for investors in such deals.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By AZ Advisory Team, January 14, 2010 4:44 pm

Alex Zylberglait of Marcus & Millichap Real Estate Investment Services is pleased to present 14705 NW 25 Ct, consisting of approximately 49,000 rentable square feet, located in Opa-Locka, FL.

Construction of this concrete block industrial facility was completed in 1966 on a 2.02 acre site. It is a Class B property in its market. There is approximately 9,000 square feet of office space with central A/C. There is also mezzanine storage space in the building. The warehouse has three dock-level doors and four grade-level doors. The clear height is 22 feet. The property is currently vacant. The building was recently renovated in 2004, renovations included interior office build-out and the roof.

Opa-Locka is a primarily industrial community located in northern Miami-Dade County. The property’s neighborhood consists of a harmonious mixture of industrial and commercial development. The neighborhood is well located with respect to transportation arteries and employment centers. It is strategically near the Golden Glades Interchange. The interchange connects the Palmetto Expressway, Interstate 95, and the Florida Turnpike. Downtown Miami and the Port of Miami are easily accessible using I-95. Industrial areas in Hialeah and Doral are accessible using the Palmetto. The Miami International Airport is accessible using both I-95 or the Palmetto. Located nearby the property is the Opa-Locka Airport which supports the business aviation community and light cargo traffic to the Caribbean.

Property Address:
14705 NW 25th Ct
Opa-Locka, FL 33054

Property Type:
Industrial Warehouse

Parcel Size: 2.02 AC
Rentable Square Feet: 48,846
Floor Area Ratio (FAR): 0.56 FAR
Zoning: I-2 Industrial – Heavy Manufacturing District
Parking: 22 Spaces
Landscaping: Trees and bushes
Street Frontage: NW 147th ST
Cross Street: NW 25th Ct

Contact Alex Zylberglait for his expert investment advisory services on this distressed asset industrial warehouse in Opa-Locka.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By AZ Advisory Team, January 13, 2010 12:33 pm

Looking at a report by our commercial real estate research partner, Real Capital Analytics — it says that “Foreign interest in buying US property is high and will grow in 2010. Asian investors will provide some of the newest capital in the market, but German funds and high net worth buyers from around the globe will also be active. The increased capital from Asia that has just started to emerge will particularly benefit the West Coast whereas more traditional European investors prefer the East Coast. Potential changes to the Foreign Investment in Real Property Tax Act (FIRPTA) could remove some barriers that have discouraged foreign investment in the US. Over the past few years, just 10% of US property acquisitions have involved cross-border investors, well below the global average of 28%. A repeal of FIRPTA is unlikely, but one likely change could facilitate greater foreign investment in US REITs, yet another reason why the REIT sector looks so promising for 2010.”

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.

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By AZ Advisory Team, January 12, 2010 10:43 am

Alex Zylberglait of Marcus & Millichap is proud to offer Square One Center, a one-story Class B medical office building with approximately 17,600 square feet of rentable space. The property was built in 1999 of concrete block. It is located right off West Dixie Highway next to Aventura, Florida. The building has ample on-site parking with a 6 to 1,000-square foot parking ratio.

The property is 100 percent occupied and has a majority of medical tenants. It is located proximate to Aventura Hospital, which recently underwent a $130 million expansion. There is ease of management for an investor with all NNN leases.

Aventura is an affluent suburban submarket in northeastern Miami-Dade County, a mile from the beach. The city is located centrally between Ft. Lauderdale and Miami. Aventura has been a rapidly growing area for several decades as people are drawn to the region’s beaches and excellent year-round climate. Minutes from the property are Highway I-95, Biscayne Boulevard and Aventura Mall.

Property Type: Office
Subtype: Medical Office

Property Name:
Square One Center

Property Address:
20880 West Dixie Highway
Miami, FL 33180

Price: $4,100,000
Size: 17,600 Rentable SqFt

Contact Alex Zylberglait for his expert investment advisory services on this office property Square One Center.

Alex Zylberglait provides commercial real estate investment advisory as well as research, estate planning, asset allocation, valuation, financing, special assets services, transaction advisory and commercial property acquisition and disposition services.