Slash Forum

Commercial Real Estate Strategies: The “columbo” Questions

Article by Tony Seruga, Yolanda Seruga And Yolanda Bishop

For the astute commercial real estate investor, the cap rate [AKA Capitalization Rate] is an important financial number to consider. Here’s why:

Commercial Real Estate Earns Income

One main identifier that defines commercial real estate from other types of real estate is that it earns income for its owner. Commercial real estate values are typically based on these current (and/or future) income streams from the property under evaluation.

While there are many types of commercial real estate, such as strip malls, office buildings, condo projects, industrial sites, and several other property types, each is supposed to produce net income.

Each of these commercial real estate properties will normally have an income stream and associated expenses. It doesn’t matter if it is a mall, hotel or a trailer park. All commercial real estate properties typically have both income coming in and expenses going out.

The Raw Land Exception

The one exception to this typical ‘rule of thumb’ is raw land. Raw land will many times not have any income stream, so it has to be evaluated differently for commercial purposes

Evaluating the Cap Rate

When a commercial real estate property is evaluated, the buyer does his or her best to ascertain the accurate and sustainable income stream the property is currently producing. The cap rate is based upon current financial numbers, not future. And if it is not being used to its highest… Read the rest

Reston va real estate values taken into consideration when relocating

Article by Shannon Griffin

The battered Reston Virginia Real Estate market is roughing up the job market, complicating new hires and long-distance moves.Few companies still offer straight-forward benefits including guaranteed buyouts of executives’ homes. Instead, creative new enticements are taking their place: Payments to aggressively market a house, bonuses for selling quickly, financial aid for extended temporary housing. The trick is settling the brightest workers into the best spots, while avoiding exorbitant costs related to homes left behind.Employees, meanwhile, are having to take new risks or bypass enticing job offers. The leap is especially big for the nearly 25 percent of U.S. mortgage holders who owe more than their homes are worth — or likely will bring at sale.Ultimately, the housing slump may have little impact on employee mobility. Out-of-state moves associated with job opportunities remained steady from 2007 to 2009, according to U.S. Census Bureau data.The difference between being unemployed and employed is enormous for people, Even when it means they have to take a loss on their house, it’s probably a move they’re going to make.But the slump clearly is changing the way job moves are handled.Companies changing programsNationwide, a third of 100 companies across a range of industries said they changed programs in 2009 and 2010 to help relocate employees, according to a survey by Worldwide Employee Relocation Council, a national trade group.Some companies now offer to pay a portion of the loss of a home sale… Read the rest

Cap Metro Commuter Train Enhances Leander TX Real Estate Values

Article by Kenn Renner

Leander, TX – Cap Metro’s commuter train eliminates commute for Leander and Crystal Falls home owners creating higher perceived home values.

Since Cap Metro opened their long awaited commuter train route from Leander to Downtown, thousands of riders have chosen to hang up the car keys and have a conductor drive them into town. The commuter train runs from its new station off of 183 and ____ in Leander to the downtown Austin station located near ____ and _____. Local home owner Matthew Carver exclaimed “I used to be stuck in traffic for over an hour both ways – it was frustrating!” Now his commute is a comfortable 50 minutes where he can relax or use the train’s wifi to surf the net or get work done. “I am much more relaxed because I can work on the way in rather than dodge traffic and I can relax on the way home in the evening – pretty cool.” Matthew, a resident of the popular golf course community of Crystal Falls, believes that the convenience of the train will help his home’s value, which is currently for sale. His realtor, Kenn Renner with Keller Williams agrees. “Being a bike ride away from the train station really makes living in Crystal Falls a viable commuting option,” said Kenn. He adds, “commute time is one of the top five considerations that home buyers consider and the train addresses… Read the rest

PEI – Great Waterfront Real Estate Values

Article by Arvind Sharma