SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

   Non-TechInvesting in Real Estate - Creative Opportunities


Previous 10 Next 10 
To: John Vosilla who wrote (2701)2/7/2021 6:39:35 PM
From: renovator
   of 2718
 
By rights, I should change my SI moniker, as I am a former renovator, I switched careers 14 years ago, to property claims adjuster. The bulk of my claims are in the NYC tri-state area except whenever I go out for an extended storm event.

I can confirm that landlords, small and large, are getting killed in the area. I have had numerous claims in large full floor office spaces where I was the only one in 3200-4000 sq ft surveying damage. The building managers tell me they are technically at close to full occupancy but that very little use is being made of the spaces and even less rent is being paid. As commercial leases end they are not being renewed and there is now a vast overflow of available commercial sub-let space in NYC. However, that is not exactly the case in the suburbs. I just had a claim the other day in a close-in suburban city with a landlord who owns many small retail buildings, some on commercial avenues and others small strip mall locations. He said they have been very successful re-leasing quickly after business blow up since Covid. Restaurants being the exception, but his firm has been reworking those spaces for straight retail or light office professional space.

On the other hand, even in the suburbs, the small residential rental claims I have are a very different story. I have had lots of claims where there is significant deferred maintenance and extensive back rent. Nobody knows when these will be subject to evictions, but it appears absolute that there will be a brutal slash and burn event whenever the protections cease. If that gets pushed out too far there will be a ton of small landlord foreclosures.

An unfortunate part of my work lately is the number of folks who have cut way back on policies or have let them lapse.

To John's point about a bubble--I have been seriously looking to leave NYC anyway, and particularly lately. I have thoroughly researched several markets within 1-1 1/2 hours of NYC, as my work is much more profitable here, in spite of traffic, parking, and every other NYC annoyance--bike lanes! Residential property in North Jersey, Rockland and Orange counties in NY has been extremely active and up a solid 25% across the board in the past year. Very quick market. I have lots of family up around Rochester, NY, where I grew up, and occasionally look that market over and it is similar with lower price points, but extremely active. My niece, a very well paid RN, has been shut out of several properties the first day of the listing by over-ask offers there.

To make matters worse, my wife hails from Austin, TX, and we have considered making that move several times over the years, put off by the serious cut-back in income we foresaw. That city has been on a wild run and standard ranch homes I considered in South Austin 10 years ago went from $200's then to $300's couple of years back and are now pushing $400's. The crappy ones are now close to $300k. Sheesh!

I see smaller, but still significant, changes in markets like Wilmington NC, where I got to know it well after Hurricane Florence in 2018 and note a significant rise in prices since then.

Share RecommendKeepReplyMark as Last ReadRead Replies (2)


From: The Barracuda™2/25/2021 9:09:20 AM
1 Recommendation   of 2718
 
St Joe anyone? Florida land company

finance.yahoo.com

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: renovator who wrote (2702)3/15/2021 11:15:00 AM
From: Madharry
   of 2718
 
thanks for the informative comments. I have purchased several mreits but decided to avoid those with nyc office exposure. I suspect that many renters who are not doing that well financially will simply leave and find another rental sticking the landlord with the back rent owed. Sad to say I dont think people are particularly honest or moral. I wonder what remedies landlord have to go after such tennants for back rent.

is there anything in the covid bill to compensate landlords for renters who dont pay their rent?
In my subdivision in Arizona there have been recent sales of similar houses to mine that went for at least 30% more than I paid 4 years ago. But I think its still cheap compared to other metropolitan areas.

Share RecommendKeepReplyMark as Last ReadRead Replies (2)


To: renovator who wrote (2702)3/16/2021 12:33:18 PM
From: John Vosilla
   of 2718
 
Yes prices have reset higher in much of the country due to ZIRP the past year seeing upwards of 15-25% appreciation which creates even more problems when rates normalize.

I am thinking extend and pretend especially with mortgages on residential so sideways to down for years to come..NYC so much inventory plus drop in population and revenues a wild card. Looking at quick numbers say 15M not paying rent or mortgage times $1500 month is peanuts to avoid another 2008 crisis for now. Whoever is in power won't let that happen again I imagine. Also most every smart person I know who has been around the block thinks a big downturn is inevitable next year.. You know what happens when everybody is thinking the same think..

Looking at months of inventory, fixed mortgage rates, yield curve, homebuilder charts and regional banking ETF's charts for clues looking out 12 months. Nothing signals a downturn YET.

Commercial RE another story. Can't see how we avoid another 1989-93 severe cramdown in asset prices and debt repositioning certain assets to highest and best current use IMHO

Thanks for all your input. Strange times

Share RecommendKeepReplyMark as Last Read


To: The Barracuda™ who wrote (2703)3/16/2021 12:44:37 PM
From: John Vosilla
   of 2718
 
Nice move since September... I don't watch the stock much anymore but the shift of population, wealth and capital to Florida due to COVID and related fallout the blue states seems to be real.. The traffic all over unbearable and imagine will get even worse when things really open up.

WSJ just had an article stating a slightly different view that just as many people are leaving as are coming here.. Media can spin anything...lol

wsj.com

Share RecommendKeepReplyMark as Last Read


To: Madharry who wrote (2704)3/16/2021 12:50:55 PM
From: John Vosilla
1 Recommendation   of 2718
 
I suspect that many renters who are not doing that well financially will simply leave and find another rental sticking the landlord with the back rent owed. Sad to say I dont think people are particularly honest or moral.

I agree with this. From my experience is like a different world from the tenant pool of 20 years ago when most had high morals, honesty and integrity... That most can somehow play the victim or oppressed when anything goes wrong these days doesn't help. Today really have to screen, screen and do more screening before giving anyone the keys..

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: John Vosilla who wrote (2707)3/16/2021 6:05:49 PM
From: Madharry
   of 2718
 
Do you use a particular service. I read about what company that recently signed a contract with a large realtor group in colorado but cant remember its name .I also remember I think some litigation because renters who were denied a lease found out it was because the credit check confused them with someone else.

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: Madharry who wrote (2708)3/21/2021 11:24:14 AM
From: John Vosilla
   of 2718
 
Sorry, I haven't done new rentals for five years. Prices went way up been selling them all as tenants leave. Now buying foreclosures doing extensive rehabs and selling in strong market. Get a lot of satisfaction buying the neglected eyesore on the block and turning it into the best looking redone home. Win, win as payments lower than rent and the buyers get a great redone almost like a new home..

Share RecommendKeepReplyMark as Last Read


To: E_K_S who wrote (2680)3/21/2021 11:32:00 AM
From: John Vosilla
1 Recommendation   of 2718
 
Repricing of our large city center residential towers hints at a massive shakeout ahead?

Value of Beekman Tower cut by 45% in new appraisal178-unit luxury residential complex mainly leased to corporate tenants

By Kevin Sun

The luxury Beekman Tower in Midtown East is now worth nearly half its $146 million valuation from 2018. (Beekman Tower)

Eight months since its owner sought pandemic-related loan relief, the landmark Beekman Tower has exited special servicing after securing a payment deferral. But the value of the corporate housing-centric property has taken a big hit.

The 178-unit complex in Midtown East is now appraised at $79.9 million. That’s down 45 percent from the $146 million it was valued at in 2018. The new appraisal is from Collier’s.




therealdeal.com

Share RecommendKeepReplyMark as Last Read


To: Madharry who wrote (2704)5/11/2021 2:56:03 AM
From: elmatador
   of 2718
 
The Amazon Paradox
"The more business move to online the more the value of brick and mortar"

Which Brick and mortar becomes more valuable?
The datacenter.

The IT, cloud infrastructure that supports everything that carried out online, is housed inside a datacenter.

If you were an Asset Management Company -that used to manage shopping malls- you would be thinking harder on leveraging what you know to move into managing these brick and mortar assets that support on line business.

Not only that, you could propose build to suit.

Note that now big datacenters users' large enterprises and hyperscale businesses have "outgrown their existing colocation portfolio and are seeking economies of scale by simply building their own facility."

One of the most important but less-discussed aspects of a built-to-suit data center is the flexibility tenants have with how to run it. Assuming they’re working with a full-service data center developer and operator with the staff and expertise to handle any or every aspect of managing daily operations, tenants can choose to operate the facility themselves or hand it off to the operator so they can focus on their core competencies and other aspects of their business.

ELMAT: The Asset Management Company become a business like today's tower companies that owns and/or manage the infrastructure of mobile operators. Ex: Castle Crown, America Towers Corp. or SBA Communications Corp.

For tenants that opt to hand off operations of their data center, it’s important that they work with a developer/operator that will function as a true extension of their team.

That means working with a partner that will use the tenant’s internal processes and tools, communicates and collaborates using the same systems, and will follow their capital approval and legal processes as though they were part of the tenant’s business.

eweek.com

You see the investors would be chasing tenants to their datacenters, training people and concentrating on their business while assured that the nitty gritty is being taken care off.

Share RecommendKeepReplyMark as Last ReadRead Replies (1)
Previous 10 Next 10