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Tag: Commercial Real Estate

  • Accommodation potential at Mount Gambier CBD site as Mitre 10 store moves out – Medical Marijuana Program Connection

    Accommodation potential at Mount Gambier CBD site as Mitre 10 store moves out – Medical Marijuana Program Connection

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    One of the most prominent buildings in Mount Gambier’s CBD is for sale.

    The 1.3-hectare property, which houses Mitre 10 on Sturt Street and Beaumont Tiles on Bay Road is up for sale through Leedwell Property.

    Mitre 10 is moving to the old Bunnings building on Jubilee Highway later in the year, along with Total Tools, after Bunnings abandoned that site when Masters closed all of its stores, including the one at the Mount Gambier Marketplace shopping centre, in 2016.

    The walls of the current Mitre 10 facing Sturt Street and Bay Road are heritage-listed as a former flour mill dating from 1882.

    Leedwell Property partner Jamie Guerra said the site was suitable for a range of uses, including residential.

    “It may be anything from more of that large format retail,” he said.

    “Someone may see a value in some of the buildings because there’s a heritage component to an element of it, but equally someone may see it as a more redevelopment site.”

    Potential for accommodation

    Mount Gambier Deputy Mayor Max Bruins said he would like to see a hotel or apartment-hotel at the site.

    “Personally, I’d love to see some more high-level accommodation within the CBD,” he said.

    “Currently, we’ve got bits and pieces scattered all over the place.

    “With Wulanda coming on stream recently and the potential for future events and conferences and things like…

    Original Author Link click here to read complete story..

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    MMP News Author

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  • 5 Steps To Source The Best Real Estate Investment Deals

    5 Steps To Source The Best Real Estate Investment Deals

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    In a real estate market that is always changing, where do you find the best deals? With today’s digital connectivity and social influencer trends, it may seem that online is the place to begin. A quick search could lead to web listings or services which depict a few properties in your area.

    However, in my experience, I’ve found that in the commercial real estate world, many options are not readily in the public eye. In addition, finding a great investment property typically involves several viewings or more. If you only tour one place, you won’t have others that can be used for comparison. Seeing only a limited number of properties could lead to risks such as overpaying or missing details in a building which set it apart from the competition.

    When new investors ask me for advice on sourcing deals, I always share that it truly is a numbers game. In my experience as an investor, I’ve sometimes looked at dozens—or even hundreds—of opportunities before buying one. Following this process means you need to have a great pipeline in place. If you have a system, you’ll be able to monitor deals over time and spot the gems. Let’s break down this approach into steps you can follow as you build your own real estate portfolio.

    Step 1: Establish A Pipeline Tracker

    You’ll want a place where you can store information about properties. You might start this in Excel or another database system. For each possibility, include the address of the place, a link to the property, contact information for the listing broker or owner, and the deal metrics. Add in details that allow you to quickly analyze and decide if a property is within your range.

    Step 2: Check Publicly Available Options

    Look for online listing sites—you’ll find places like Co-Star, LoopNet, and many others that typically post what brokers send them. Keep in mind that what you view are the opportunities brokers decide to publicly share with the masses. The best deals might not be readily available to wide audiences—and you won’t be able to catch a glimpse of the opportunities that are off market on these sites.

    You can also search broker websites; start by identifying who the most active investment sales brokers are in your area. In some secondary and tertiary markets, you may find that brokers act as generalists. For instance, a sales broker might also offer services as a leasing broker. Add whatever you find in these places to your pipeline tracker.

    Step 3: Build Relationships With Brokers

    After you find the names of the active brokers in your area, call them up. Ask to meet and get to know them, and share any information with them that could be helpful. As you build a relationship, they may tell you what they have in their own pipeline. Forming these connections could take time, especially if you are a new investor, but they are worthwhile in the long-term.

    Step 4: Canvas The Area

    There’s really no substitute for getting out and walking around a neighborhood or driving through a sector you are considering. I recently carried out an online search for retail properties in Connecticut, and only found a couple that were publicly listed. When I drove through the area, I discovered multiple retail properties with “for sale” signs in front of them. I also spotted some interesting places with potential that were offered for lease and had vacancies. All of these could be entered into my pipeline as potential targets.

    Step 5: Identify Vacant Or Mismanaged Properties

    Here’s another time when you’ll want to do some research and then make a call. If you see a property that’s sitting and seems inactive, find out why. Check data providers like Reonomy to get information about the property and owner. Then reach out to the owner and ask if they have plans for the place.

    Once you’ve carried out these initial steps, you’ll have the beginnings of a pipeline you can use as a resource. Remember that the most important part of finding a great deal lies in the follow through. Sometimes the best opportunities are those that have been sitting on the market—or off the market—for months. If you circle back to them, you may discover that the seller’s motivation has changed, especially in this market. They might lower their price or be willing to change their terms. You could then move forward and acquire an incredible property. Over time, the pipeline can become an invaluable tool to help you build your portfolio and realize your investing goals.

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    James Nelson, Contributor

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  • Unexpected Liability For Owners Of Small Businesses

    Unexpected Liability For Owners Of Small Businesses

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    An entrepreneur wants to create a small business. So they set up a corporation or a limited liability company online, because they know that’s how you’re supposed to do it. That way, your personal assets aren’t supposed to be at risk if the business fails. It’s a good insurance policy.

    A recent New York case demonstrated once again that the corporate-structure insurance policy might not be so good after all.

    There, a person named Yuan Sheng Situ (or perhaps Su Hua Situ) apparently created and owned a company that signed a lease as tenant. The tenant took possession of the leased premises but never paid any rent. The landlord sued the tenant on the lease, of course, but also tried to sue the individual owner of the company (the “individual defendant”) for the unpaid rent.

    The individual defendant presumably argued (or should have argued) that the only tenant on the lease was the corporation, there was no personal guaranty, the landlord had chosen to do business with a corporation, the landlord should have known what a corporation is, and therefore the landlord should only be able to sue the corporation even though the corporation had no assets. Whether based on those good arguments or other arguments, the individual defendant asked to be removed from the landlord’s lawsuit.

    The court that initially heard the case refused to do that. The appellate court agreed. To the contrary, both courts accepted the proposition that the landlord might very well be able to “pierce the corporate veil” and convert the claim against the corporation into a claim against the individual defendant. That could happen because the individual defendant somehow lost the protection the corporate form was supposed to provide.

    Exactly what did the individual defendant do to expose itself to that risk? According to the appellate court, the individual defendant negotiated the lease on behalf of the corporate tenant. The landlord communicated with the individual defendant almost daily to negotiate the lease. The individual defendant was in the leased premises “on almost a daily basis.”

    All those things are, however, exactly what always happens when someone sets up their own corporation and then runs that corporation’s affairs. Those ordinary activities of a corporation’s owners are just how any corporation works. The fact that the corporation’s owners do things in their role as corporate officers shouldn’t create individual exposure. How else are corporations supposed to conduct business?

    The court also stepped back a bit and declared that the lease “resulted in inequitable consequences” because the tenant didn’t pay rent. In other words, the individual defendant “conspired to perpetrate a wrong by opening a judgment proof shell company” to avoid paying rent. If the landlord wasn’t happy with the credit strength of the corporation, though, it should have demanded a personal guaranty, a larger security deposit, or a better tenant entity. The fact that it didn’t do those things doesn’t mean the landlord should have a good claim against the corporation’s owner. The landlord chose to deal with the corporation.

    Those are great arguments, of course. But the individual defendant remains stuck in this litigation, facing potentially substantial claims. The use of a corporation was supposed to protect the individual defendant from those claims.

    An owner of a small business can, of course, avoid that problem by making sure that its corporation always pays its debts. But sometimes that doesn’t happen. The essential function of the corporate form is to protect the owner of the business. If the facts of this case are enough to convince a court to remove that protection, then any small business owner shouldn’t rely on the use of a corporation as a way to protect the owner’s other assets.

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    Joshua Stein, Contributor

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  • BUC-EE’S TO BREAK GROUND ON NEW TRAVEL CENTER IN SMITHS GROVE, KY ON JUNE 5

    BUC-EE’S TO BREAK GROUND ON NEW TRAVEL CENTER IN SMITHS GROVE, KY ON JUNE 5

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    SMITHS GROVE, Ky., May 15, 2023 (Newswire.com)
    –
    Buc-ee’s, home of the world’s cleanest bathrooms, freshest food and friendliest beaver, will break ground on its new travel center in Smiths Grove, Kentucky, on Monday, June 5, 2023. At 10:30 a.m. CST, Buc-ee’s will celebrate the start of construction with a ceremony attended by local and state leaders who helped make the project possible. 

    Buc-ee’s Smiths Grove is the second Buc-ee’s location in Kentucky. The first, Buc-ee’s Richmond, opened in April of 2022.

    Located at 4001 Smiths Grove-Scottsville Road, Buc-ee’s Smiths Grove will occupy 53,471 square feet and offer 120 fueling positions. Buc-ee’s favorites including Texas barbeque, homemade fudge, kolaches, Beaver Nuggets, jerky and fresh pastries will all be available. Visitors will find thousands of snack, meal and drink options, as well as the same award-winning restrooms, cheap gas, quality products and excellent service that have won the hearts, trust and business of millions in the South for 40 years.

    Attendees of the Buc-ee’s Smiths Grove groundbreaking ceremony will include Rocky Adkins, Senior Advisor to Governor Andy Beshear of Kentucky; Mayor David Stiffey of Smiths Grove; Smiths Grove City Commissioners Bob Buehl, Buddy Marr, Steve Roney, and Eric Schroader; Warren County Judge-Executive Doug Gorman; and former Warren County Judge-Executive Mike Buchanon.

    Founded in Texas in 1982, Buc-ee’s operates 45 stores across Texas and the South. Since beginning its multi-state expansion in 2019, Buc-ee’s has opened travel centers in Alabama, Florida, Georgia, Kentucky, South Carolina, and Tennessee. Now, Buc-ee’s is headed West with store groundbreakings in Colorado and Missouri.

    “We are excited to be in Western Kentucky along a beautiful stretch of I-65 between Nashville and Louisville,” said Stan Beard of Buc-ee’s. “Smiths Grove will be the smallest town with a Buc-ee’s. It has a big heart just like we do, so we’ll get along just fine!” 

    Throughout the project, the Buc-ee’s development team will continue to work closely with local partners including the City of Smiths Grove, KYTC and Warren County. Buc-ee’s Smiths Grove will bring at least 200 jobs to the area, with starting pay beginning well above minimum wage, full benefits, a 6% matching 401k, and three weeks of paid vacation.

    General Photos Courtesy of Buc-ee’s: CLICK HERE. 

    About Buc-ee’s

    Buc-ee’s is the world’s most-loved travel center. Founded in 1982, Buc-ee’s now has 34 stores across Texas, including the world’s largest convenience store, as well as 11 locations in other states. Buc-ee’s is known for pristine bathrooms, a large amount of fueling positions, friendly service, Buc-ee’s apparel and fresh, delicious food. Originally launched and still headquartered in Texas, Buc-ee’s has combined traditional quality and modern efficiency to redefine the pit stop for their customers. For more information, visit www.buc-ees.com.

    Source: Buc-ee’s

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  • Burkhardt, Cohen and Ciancimino join Newmark | Long Island Business News

    Burkhardt, Cohen and Ciancimino join Newmark | Long Island Business News

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    Newmark has added three industrial sales and leasing brokers to its Long Island roster. 

    Kyle Burkhardt, Joshua Cohen and Patrick Ciancimino, formerly with Cushman & Wakefield, have joined Newmark, where they will work out of its Melville office. 

    The three have represented institutional investment firms and Fortune 500 companies, completing over 10 million square feet of transactions with an aggregate value exceeding $1 billion, according to a Newmark statement. 

    “Kyle, Josh and Patrick make up one of the top industrial teams on Long Island, and they are well-regarded by their peers and work aggressively on behalf of their clients,” Chuck Tabone, executive vice president and managing director of the Newmark’s Long Island office, said in the statement. “Having them join our talented group of real estate professionals will build upon our reputation of stewarding best-in-class client services.” 

    Burkhardt said the Long Island industrial sector on Long Island has changed dramatically with many institutional investors entering the market.  

    “Our decision to join Newmark was rooted in believing that the platform will help us better serve these clients,” Burkhardt said in the statement. “The platform at Newmark provides all the services we need to facilitate major institutional deals and allows us to cross-collaborate with the firm’s other business lines, including capital markets, office leasing and the national industrial teams.” 

    i

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    David Winzelberg

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  • Do You Know How to Make Your Real Estate Investment Last? | Entrepreneur

    Do You Know How to Make Your Real Estate Investment Last? | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Everyone knows that location is a critical factor when it comes to investing in real estate. Purchasing any property requires a litany of considerations and due diligence before any assets or resources can change hands, but the location is paramount.

    Neighborhoods with low crime rates, excellent school systems and up-and-coming communities are the regions where property values tend to increase at the highest rates. When you make an investment into a hot new part of town or a city that offers stability and growth, these neighborhoods are far more appealing and the price tags for both sales and rentals tend to reflect the high desirability of these locations.

    Location isn’t just about the dwelling itself, it’s about the positive growth of the surrounding areas in which your real estate is located and the trends that demonstrate an upswing in the contributions of the community at large that make the area more desirable. Hopefully, those trends continue on an upward trajectory to make your investment a profitable one.

    Related: 5 Proven Steps to Become a Real Estate Millionaire, According to an Investor

    Improving value

    Whether it’s the purchase of a standalone home or buying a rental property, you want the value to increase over time. When that happens, you can sell the home for more than you initially paid for it and rental prices can rise as residences in the area become more valuable. That return on investment is the goal for homebuyers and property owners who are looking to develop some passive income channels.

    But the important thing to remember is that your value is not determined by the physical dwelling in which you or your tenants reside. Buildings depreciate over time and renovations require more investment of capital. The greater impact on improving the value of real estate is the cost of the land and the community surrounding it.

    That’s right, the lot upon which you’ve built that house or apartment complex is where the value really lies. A gorgeous home or brand new building in a community that is otherwise depressed or rundown tends to suffer in a resale or setting the price for rent. Why is that?

    It’s due to the very simple and obvious fact that people don’t want to live in a neighborhood that doesn’t have a lot to offer in terms of a safe, functional and welcoming community. In big cities, there are so-called “good” blocks and “bad” blocks. One area may be safe, while another just a few blocks away may be infamous due to a higher crime rate and a slew of empty storefronts with “For Lease” signs in the windows. It makes you wonder why those businesses have left the area and buyers and renters alike may also decide it’s time to look elsewhere when choosing a place to call home.

    Related: Market Knowledge Is Vital In Making Efficient Real Estate Investment Decisions

    The importance of community

    When a region becomes more attractive to homeowners and prospective tenants, the value of your real estate increases. Some locations offer stability in terms of increased value because they are situated in a community that isn’t likely to see any major shifts in the future.

    A good example of this is a college town. The institution around which these neighborhoods are situated is highly unlikely to move, shut down or suffer any real significant, negative changes any time soon. This is particularly true in towns where the college or university has been in existence since the 1700s. We know that the school isn’t going to suddenly relocate, we know that the school will offer admission to a limited number of applicants and the students, faculty and administrators will need a place to live, eat, work and play when classes are not in session. Therefore, these communities are going to be bustling and popular, safety will be a priority and homes and apartments will be in demand.

    The only thing to consider that might be a negative is the seasonal aspect of buying real estate in or near a college town. Students and faculty may leave for the summer. But it’s just a three-month shift and when everyone returns in the fall, the community returns.

    Real estate and renovations

    Don’t get me wrong, it’s important to maintain the asset that sits on the plot of land you own. A shoddy apartment building or a home that’s falling apart are depreciating assets that can also bring down the value of the neighborhood as a whole. Buyers and renters know they can find somewhere else to go. If enough homes and buildings start to look dilapidated or neglected and desperately in need of repair, people tend to migrate away from these areas.

    One vital way to keep the value of your investment from falling is to make the repairs you need to make as soon as you can make them. A highly desired location can make some potential buyers or renters overlook the less-than-perfect condition of the dwelling because they can live, work and play in a hot neighborhood. But location is key for getting them to make the deal. Depressed areas will drive them away. It’s tougher to move a tract of land than to demolish a dilapidated home or dwelling.

    So you can do your part by keeping your property values up and helping the neighborhood thrive by maintaining what you own. New homes and businesses move into the area and the cost of your home and the land on which it stands goes up.

    Related: 7 Tips for Managing Your Real Estate Business Like a Pro

    Wrapping up

    Land can become a premium commodity when there isn’t enough of it to go around. Choosing a location that is desirable and fully developed means that space is at a premium, with prices to match when people want to live in that area. This is true in the big metropolitan cities and even smaller, more rural towns. When there is room to expand, prices tend to be lower. Location matters and when there is less of it to go around, people are willing to pay for what’s available because it may not be available for very long.

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    Ari Chazanas

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  • How To Deal With Letters Of Credit From Silicon Valley Or Signature Bank

    How To Deal With Letters Of Credit From Silicon Valley Or Signature Bank

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    Commercial leases often require tenants to deliver letters of credit instead of cash security deposits. This practice reflects the belief that an L/C gives the owner better security than a cash deposit if the tenant goes bankrupt. Until very recently, many of those L/Cs came from Signature Bank or—especially for start-up or high-tech companies—Silicon Valley Bank.

    When those banks failed, the L/Cs they had issued temporarily became worthless, because they are not backed by deposit insurance and simply represent contractual obligations of the issuer. The federal government solved that problem quickly. The FDIC declared that the “bridge banks”—the temporary banks that took over for the failed banks—would honor all contracts of the failed banks. That would include any outstanding L/Cs. Thus, any owner that had accepted a Signature Bank L/C became the holder of a Signature Bridge Bank L/C instead. The FDIC’s announcement also stated that “all obligations of the bridge are backed by the FDIC and the Deposit Insurance Fund.”

    An owner might still worry that the L/C isn’t quite as reliable or as comforting as it was supposed to be. In that case, the owner will need to ask itself whether it can require the tenant to replace that L/C with a potentially “better” one. That will depend on the terms of the lease.

    Some leases contain elaborate provisions that would probably entitle the owner to require the tenant to replace any L/C that was issued by a bank that failed, whether or not the successor bank or the FDIC stepped up to the L/C obligation. In those cases, the owner might simply demand that the tenant perform its obligations under the lease and deliver a new L/C. In a more typical case, however, the tenant probably has no obligation to do anything about the L/C. A tenant that cares about its relationship with the owner might very well arrange a replacement of the L/C anyway, if asked to do so.

    Also, any Signature Bank or Silicon Valley Bank L/C will eventually expire and probably not be renewed, typically within a year. At that point, nearly every lease will require the tenant to deliver a replacement L/C. Of course, the owner will not want to wait around.

    If the owner can require the tenant to replace a Signature Bank or Silicon Valley Bank L/C, or if the tenant wants to cooperate if asked to make such a replacement, what happens next and how long will it take? In most cases, it’s not all that difficult for a tenant to accommodate the owner’s request and deliver a new L/C from a bank that hasn’t failed.

    Most L/Cs are issued by whatever bank provides the tenant’s revolving credit line (“revolver”). The existence of a revolver means the tenant’s bank has decided it is willing, for example, to lend the tenant up to $10,000,000 at any one time. If the bank issues an L/C with a face amount of $1,000,000, this implies the bank might need to advance $1,000,000 at any moment, if the L/C were drawn upon. The bank would treat any such advance, if made, as one made under the revolver. As long as the L/C is outstanding, therefore, the bank will limit other borrowings under the revolver to $9,000,000, to assure that the total loan balance can never exceed $10,000,000.

    If the tenant maintains several revolvers with various banks, the tenant can often obtain a replacement L/C rather quickly from another bank, assuming its revolver with that other bank has a low enough outstanding loan balance to accommodate issuance of an L/C. If the tenant had only one revolver, i.e., with only Signature Bank or Silicon Valley Bank, then the tenant won’t be able to have a revolving lender issue a replacement L/C unless and until the tenant has set up a new revolver. That can take a while, especially in an environment of tightening credit standards and lower asset valuations.

    In the meantime, the tenant might temporarily resort to a less sophisticated strategy to obtain a replacement L/C: the tenant can deposit cash with a new L/C issuer bank and then that new bank would issue an L/C backed by the cash deposit. Of course, that’s not an optimal use of cash or one that every tenant can set up instantly.

    Smaller companies that don’t maintain any revolver in the first place often need to back their L/Cs with cash collateral from day one. If one of those companies deposited cash with Silicon Valley Bank or Signature Bank, that deposit should be treated the same as any other deposit. If it’s covered by deposit insurance, which all deposits of the two failed banks now seem to be, the tenant should be able to get control of the cash rather quickly. The tenant can then use the cash as collateral to have another institution issue an L/C. That’s quicker than setting up a new revolver, but it’s still not instant.

    If the tenant delivers a new L/C in place of the L/C from a failed bank, the tenant will typically ask the property owner to release the first L/C. This would also need to happen at the same time as the tenant moves cash between banks.

    Any owner holding an L/C from Silicon Valley Bank or Signature Bank should make sure they know exactly where that L/C is stored. If no one can find it—which happens with some frequency—that can create a whole new set of problems. And today’s focus on L/Cs also reminds every property owner that they should carefully track all L/Cs – not just their location but also their amount, expiry date, and issuer.

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    Joshua Stein, Contributor

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  • Free Webinar | April 20: Success Secrets of an Eight-Figure Real Estate Agent and Broker | Entrepreneur

    Free Webinar | April 20: Success Secrets of an Eight-Figure Real Estate Agent and Broker | Entrepreneur

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    Join our upcoming webinar with real estate entrepreneur, Aaron Kirman, as he shares his 20+ years of expertise and insights on how to master the art of selling properties.

    Aaron will cover the essential daily strategies and success habits you need to thrive.

    You will learn how to:

    • Find great listings
    • Gain client trust and respect
    • Manage your time effectively
    • Maximize your profits
    • Control operating expenses
    • Calculate startup costs

    Register now and join us on April 12th at 2:00 PM ET to discover the strategies and tactics you need to master for success in real estate.

    About the Speaker:

    Aaron Kirman, Founder and CEO of AKG | Christie’s International Real Estate, is one of the leading real estate agents in the U.S. He has repeatedly been named as a top agent in Los Angeles, and most recently, AKG was ranked as the #1 Luxury Team in L.A. As an expert in the luxury real estate industry, Aaron has received international acclaim from the architectural and estate communities, and represented some of the most exclusive properties in the world.

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    Entrepreneur Staff

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  • Farrell and Pidgeon land at Avison Young | Long Island Business News

    Farrell and Pidgeon land at Avison Young | Long Island Business News

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    Leo Farrell and Ed Pidgeon

    By: David Winzelberg

    February 23, 2023

    Veteran commercial real estate brokers Leo Farrell and Ed Pidgeon have found a new roost. 

    The two brokers have joined Avison Young in Melville, with Farrell becoming a principal and Pidgeon being named a director at the brokerage firm. 

    Both Farrell and Pidgeon spent the last 10 years as principals at NAI Long Island and each has more than 30 years of experience in the commercial real estate industry on Long Island. 

    “The opportunity to move on to a firm with a strong local presence combined with an international platform was too compelling to pass up,” said Farrell, who was recently appointed to the executive board at the Commercial Industrial Brokers Society of Long Island. “We look forward to continuing our careers with Avison Young and are very excited to join Managing Principal Ted Stratigos and his team.” 


    commercial real estate

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    David Winzelberg

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  • Tech giants are shedding workers and real estate. Employees-turned-entrepreneurs could win big—and snag sweet offices

    Tech giants are shedding workers and real estate. Employees-turned-entrepreneurs could win big—and snag sweet offices

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    Tech giants are busy laying off workers and reducing office space. In the process, they might also be setting in motion the emergence of new entrepreneurs and startups—who will be able to collaborate in suddenly affordable prime commercial real estate.

    Angel investor Jason Calacanis predicted on the All-In podcast that the big business winners of 2023 will be “laid-off tech workers who choose to take control of their destiny and start companies.”

    “I think laid-off tech workers who get together in groups of two, three, or four—developers, product managers, people who actually build stuff—and start companies together are going to become extremely successful, and they’re going to make incredible lemonade from these lemons of these big tech layoffs,” he said earlier this month.

    From employee to entrepreneur

    Some of those employees-turned-entrepreneurs might come for example from Meta, which recently laid off about 11,000 workers. The Facebook owner is also shedding office space, both to reduce costs and because it’s embraced remote work. On Friday, it confirmed it will sublease office space in Seattle it no longer needs, according to the Seattle Times. It also recently gave up real estate in New York City. 

    Subleased office space is typically rented out at a discount, which could allow startups who otherwise couldn’t afford it to move in, noted Colliers leasing expert Connor McClain to the Seattle Times.

    It isn’t just Meta that has recently both laid off workers and let go of real estate. So have plenty of other major tech companies, among them Microsoft, Salesforce, and Twitter.

    Salesforce recently announced layoffs—about 10% of its staff—while also indicating it will shed real estate. CEO Marc Benioff said in an all-hands meeting.

    Office rents ‘will go lower’

    “This is a larger moment for cost restructuring, we want to take…somewhere between $3 to $5 billion out of the business,” he said. “When we look at how are we going to do that, real estate is going to be a major part of it.”

    The company is headquartered in San Francisco. A Jan. 7 exchange between PayPal co-founder David Sacks and Tesla CEO Elon Musk highlighted the commercial real estate situation there. Sacks tweeted, “Just got offered office space in San Francisco (SOMA) for the same price as 2009. Yikes.”

    Musk replied, “It will go lower.” 

    As it does, entrepreneurs emerging from the tech layoffs could take advantage of the cheaper real estate to house new businesses. 

    Of course, some startups might choose to save money by not renting commercial real estate and having everyone work from home. But as CEOs at large companies like Disney and Starbucks have recently indicated—while insisting remote workers return to the office—there are clear business advantages to collaborating face to face.  

    As Disney CEO Bob Iger wrote to employees in a recent memo, “In a creative business like ours, nothing can replace the ability to connect, observe, and create with peers that comes from being physically together.” 

    That might be especially true for tech entrepreneurs determined to make lemonade from the lemons of being laid off. 

    Learn how to navigate and strengthen trust in your business with The Trust Factor, a weekly newsletter examining what leaders need to succeed. Sign up here.

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    Steve Mollman

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  • BUC-EE’S TO BREAK GROUND ON NEW TRAVEL CENTER IN HILLSBORO, TX ON JAN. 24

    BUC-EE’S TO BREAK GROUND ON NEW TRAVEL CENTER IN HILLSBORO, TX ON JAN. 24

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    Press Release
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    Jan 10, 2023 13:00 CST


    HILLSBORO, Texas, January 10, 2023 (Newswire.com)
    –
    Buc-ee’s, home of the world’s cleanest bathrooms, freshest food and friendliest beaver, will break ground on its new travel center in Hillsboro, Texas, on Tuesday, Jan. 24, 2023. The start of construction will be celebrated at 1 p.m. CST with a ceremony attended by local leaders.

    Located at 165 State Highway 77, Buc-ee’s Hillsboro will occupy 74,000 square feet and offer 120 fueling positions. Buc-ee’s favorites including Texas barbeque, homemade fudge, kolaches, Beaver Nuggets, jerky and fresh pastries will all be available. Visitors will find thousands of snack, meal and drink options, as well as the same award-winning restrooms, cheap gas, quality products and excellent service that have won the hearts, trust and business of millions in the South for 40 years. 

    Attendees of the Buc-ee’s Hillsboro groundbreaking ceremony will include Mayor Andrew Smith of Hillsboro along with members of the Hillsboro City Council, as well as Hill County Judge Justin Lewis and the Hill County Commissioners Court.

    Founded in Texas in 1982, Buc-ee’s operates 44 stores across Texas and the South. Since beginning its multi-state expansion in 2019, Buc-ee’s has opened travel centers in Alabama, Florida, Georgia, Kentucky, South Carolina, and Tennessee. Now, Buc-ee’s is headed West with store groundbreakings in Colorado and Missouri. 

    “Hillsboro is one of the best forks in the road we’ve ever seen, and they have a beautiful, historic courthouse as a bonus!” said Stan Beard of Buc-ee’s. “Whether you’re headed to Fort Worth and West Texas or Dallas and East Texas, you can make Buc-ee’s your stop, coming and going. The City of Hillsboro and Hill County have been such great partners, and we look forward to being a great neighbor for years to come.” 

    Throughout the project, Buc-ee’s corporate development team will continue to work closely with local partners including the City of Hillsboro and Hill County. Buc-ee’s Hillsboro will bring at least 200 jobs to the area, with starting pay beginning well above minimum wage, full benefits, a 6% matching 401k, and three weeks of paid vacation.

    General Photos Courtesy of Buc-ee’s: CLICK HERE. 

    About Buc-ee’s
    Buc-ee’s is the world’s most-loved travel center. Founded in 1982, Buc-ee’s now has 34 stores across Texas, including the world’s largest convenience store, as well as 10 locations in other states. Buc-ee’s is known for pristine bathrooms, a large amount of fueling positions, friendly service, Buc-ee’s apparel and fresh, delicious food. Originally launched and still headquartered in Texas, Buc-ee’s has combined traditional quality and modern efficiency to redefine the pit stop for their customers. For more information, visit www.buc-ees.com.

    Source: Buc-ee’s

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  • 4 Changes Every Landlord Should Consider

    4 Changes Every Landlord Should Consider

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    Opinions expressed by Entrepreneur contributors are their own.

    As we swiftly turn the corner into 2023, there are many considerations on the minds of those in the real estate industry, including landlords. The past year has been one of change, and experts predict more challenges in the general real estate market and the rental landscape. If you’ve been in the game for a while, you probably realize that what is happening right now is part of a cycle, and things will eventually even out and stabilize once again. But if you’re like me, you want to experience more short-term success as a landlord today. Here are a few suggestions on resolutions to consider to make 2023 a successful year.

    Related: The 5 Types of Landlords Businesses Will Encounter

    Invest in technology to advance your business and properties

    As a business founder and owner, I am acutely aware of just how crucial it is to make investments to experience ongoing success. As an investment property owner, upgrading technological devices within your rental properties is a great place to begin. Whether it is upgrading kitchen appliances, installing security systems such as a Ring doorbell, upgrading in-unit laundry machines, offering fiber optic internet connection (if available) or installing AI technology that can ease the life of your tenants, current and future tenants will appreciate the investments in the property and will likely choose to stay put with these upgraded amenities.

    Also consider investing in a technology platform to help you manage your rental properties. This investment can make your life and job easier as a landlord or property manager and allow you to have all documents on file electronically.

    Depending on the technology platform you decide to invest in, additional benefits could include accepting online rent payments, scheduling maintenance and property inspections, marketing vacant properties with a single click and streamlining security deposit or surcharge features.

    Your time is valuable — invest in a platform that will make your life and your tenants’ lives easy and headache-free. Do your research and find the best platform that fits your unique needs.

    Related: 6 Tech Challenges Facing Remote Real Estate Companies

    Offer tenants easily accessible information

    Whether you are considering investing in technology and upgrading your rental management system, having information readily available for your tenants is a goodwill gesture. If the technology route is not for you, having a good filing system for important documents regarding each tenant is important in general. If a tenant has questions about their lease or a simple question, you will have easy access to that information.

    Better yet, some systems offer tenant portals so that they can access their own information at will. Over my years as a landlord and rental property owner, I’ve found that the easier you can make things for your tenants, the more likely they will continue to rent from you. And turnover is one of the most significant expenses for rental properties, so it is worth the investment.

    Related: 5 Major Deal Points to Know Before Signing a Lease

    Prep for continued increases in rental and property prices

    This past year taught us that the housing market could be volatile. Due to the increasing cost of rent, mortgage rates and inflated housing prices, many landlords and property managers across the country have struggled to keep properties filled and struggled to collect rent payments. As inflation increases, a plan must be implemented to avoid struggles, such as late or unpaid rent payments.

    Seek advice from veterans in the industry and research ways you can improve your proactive business plan to avoid hardships to the best of your ability. Creating a plan or improving on a preexisting one can be done over time and learned and improved upon through personal experiences or others’ experiences in the industry.

    Retain employees in current economic conditions

    At Rentec, we’ve been fortunate to have a high employee retention rate, even after 13 years of growth. I can’t emphasize enough how important it is to retain talent, especially in the current economic climate. Make sure to create a plan to keep employees and ensure they are happy with their job for the next year. Small gestures go a long way. A simple thank you card after a long week or hard project is appreciated and valued by many.

    If possible and on budget, set aside funds to treat your employees. Providing a meal or small work retreat at a local park strengthens the bond between employees and is one good way to have an environment encouraging people to work hard. Combining gestures like this with fair compensation, including competitive salaries and benefits packages, can contribute to higher retention and overall satisfaction rates. I’ve found that one of the most vital actions on this front is to create open, two-way communication channels among leadership and staff, creating an environment of collaboration and teamwork.

    Related: 10 Strategies for Hiring and Retaining New Employees

    While none of us can know what the coming year will bring, there are a few steps you can take to reach all your goals as a landlord or property manager or any other business owner. Investing in technology, creating efficient processes, watching market trends and focusing on employee satisfaction can help.

    Remember, resolutions do not always have to be immediate; instead they can be implemented over time, on your best schedule. Even small improvements can go a long way in any business. I encourage you to begin creating a plan and consider options best suited for your business and investment properties to make the best of 2023.

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    Nathan Miller

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  • Is Real Estate Investment Trusts a Good Career Path in 2023?

    Is Real Estate Investment Trusts a Good Career Path in 2023?

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    Getting into real estate is often considered to be a lucrative career path. But you don’t have to buy and sell properties to join this industry as a professional. You can enter a real estate investment trust (REIT) company or become a REIT investor.

    Keep reading for the info you need to consider to decide if real estate investment trusts are good career paths for professionals like you.

    Real estate investment trusts explained

    A real estate investment trust or REIT is a group of funds or securities for real estate. REIT management companies oversee real estate acquisitions, sales and diversification.

    Think of a REIT similarly to a mutual or exchange-traded fund (ETF). With a mutual fund, several stocks or securities are gathered together into a group. Investors can then purchase mutual fund shares rather than individual shares in the fund itself.

    Similarly, with a real estate investment trust, investors can purchase partial ownership or shares of the trust, thus gaining the financial benefits of simultaneously investing in multiple pieces of real estate or other securities.

    Through REITs, investors can invest in portions of real estate projects or properties and generate profits. Most real estate investment trusts are collections of properties such as hospitals, shopping malls, apartments and other large properties rather than single-family homes, though this is only sometimes true.

    Related: The Most Stable REIT to Buy for a Recession

    Real estate investment trusts are often attractive to investors because they don’t require those investors to finance, purchase or manage any properties by themselves. Instead, REIT companies and their employees handle all the details.

    What does a REIT company do?

    A REIT company acquires real estate properties and securities for its clients. It monitors the market, sells properties when necessary and continues to grow the collected trust and portfolios under its control for the financial prosperity of its clients.

    A REIT company is similar to a mutual fund manager. They take care of the day-to-day monitoring of properties of investments for their clients, plus give out dividends to those clients every month.

    REITs in more detail

    Only some companies that invest in real estate qualify as REITs.

    For a company to be a legitimate REIT, it must:

    • Invest 75% or more of its total assets in real estate and U.S. treasuries for cash.
    • Derive 75% or more of its gross income from interest on mortgages, real estate sales or rent payments.
    • Pay at least 90%of its taxable income as shareholder dividends each fiscal year.
    • Be a taxable corporation.
    • Be managed by a board of trustees or directors.
    • Have at least 100 shareholders or more after the first year of operations.
    • Have no more than 50% of its shares owned by five or fewer people.

    Related: 3 REITs That Could Be the Backbone of Your Portfolio

    Do REITs pay investors dividends?

    Yes, which is part of what makes them so desirable for investors. Both residential and diversified REITs pay monthly dividends to their shareholders and investors. This monthly income comes from rent and mortgage payments from the people who own the properties in the REIT.

    Most REITs have an average rate of return of about 10.5%, similar to the rental rate of return landlords can expect in their first years of operation. Unlike landlords, however, REIT investors don’t need to spend much time and money maintaining or managing properties.

    Note that REIT managers or companies collect a small commission from accrued mortgage and rent payments as the cost of their services. This is what pays the workers of real estate investment trusts, their managers and other professionals.

    So, should you get involved with real estate investment trusts?

    That depends on your career ambitions and prospects. REIT management is a complex and even potentially risky field for many.

    If you get into REIT, you’ll often need to start at the bottom and work your way to the top, so your salary may not be exceptional in the first years of your career. However, the potential rewards of sticking with this career for several years could be pretty enticing.

    You should consider getting into real estate investment trusts as a career path if:

    • You are already interested in investing in real estate. Joining a REIT company could be the best way to learn about this unique investment field and how best to operate within it.
    • You are interested in acquiring real estate and learning more about the real estate market.
    • You have strong management skills.
    • You are comfortable with a certain level of risk — not for yourself, of course, but for your clients.

    What will you do in a REIT company?

    That depends on your exact job title and responsibilities.

    For most in the REIT industry, career paths begin by obtaining a position at a REIT company’s headquarters. You may start with essential maintenance or secretarial work, but gradually learn more about how a REIT company chooses its assets, communicates with its clients, and advertises its services to acquire new clients.

    Real estate investment trusts career paths

    There are multiple potential career paths you can pursue in any REIT industry. Here are just a few examples.

    Related: The Best Careers for Your Personality Type (Infographic)

    Property manager

    You might work as a property manager. Many REIT companies work with third-party property management companies. In a nutshell, property managers maintain rental properties, like apartment complexes or multiple homes throughout the same neighborhood.

    If you work for a property management company, you might eventually be able to work for a REIT. Alternatively, if you work for a REIT, you might work as a property manager for that trust. In this case, the trust takes care of various rental properties, which it maintains and oversees on behalf of its clients.

    Asset manager

    You could also pursue a career as an asset manager. REIT asset managers decide which properties they should purchase and how much debt they need to take out in terms of loans or other financing arrangements to purchase those properties.

    Asset managers also oversee all the aspects of owning and operating properties and ensure property expenses align with projections. This mid-level management job requires a lot of experience in real estate, investing and similar areas.

    Development executive

    Development executives are chief executives for these funds. Thus, they have a lot of sway regarding what properties the REIT purchases, its profit and debt targets, and how the fund evolves.

    Development executives identify opportunities to purchase new properties for the fund’s clients to improve financial prosperity for everyone involved.

    This position pays well and is an excellent stepping stone to senior management positions in other real estate investment industry companies. However, expect to acquire lots of experience in the REIT arena before qualifying for this position.

    Acquisition analyst

    Acquisition analysts are closer to the entry-level or middle manager position than development executives. That said, they are critical.

    REIT acquisition analysts plan, implement, coordinate and identify properties that the fund they work for should acquire. For instance, they may find an attractive apartment complex that needs new investors, then recommend that the REIT company purchase it to diversify the portfolio further.

    Related: 3 REITs to Buy and Hold for the Long Term

    Because of this, acquisition analysts need skills and experience in the real estate investment industry. They need to know how to recognize and understand market trends, spot available properties and know what properties are worth.

    It is also beneficial to have contacts in the real estate or investment industries before applying for these positions in a REIT. For instance, if you are friends with local realtors, you can get an early scoop about up-and-coming properties or new listings from your friends, allowing you to recommend properties to your REIT company or more quickly than other analysts.

    Summary

    Ultimately, you might enjoy working for a REIT company if you like investing, real estate, analysis and similar topics. If you’re successful in this field, you’ll also make a pretty fair salary.

    Check out Entrepreneur’s other resources and guides today to learn more about real estate, investments, and related topics.

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    Entrepreneur Staff

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  • 6 Overlooked Investment Opportunities in Commercial Real Estate

    6 Overlooked Investment Opportunities in Commercial Real Estate

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    Opinions expressed by Entrepreneur contributors are their own.

    In commercial real estate, smart owners exploit every available opportunity to maximize their net operating income (NOI) and create new, leverageable equity. Over time, small changes can generate millions of dollars in cash flow and added value, which will be critically beneficial as you grow your CRE portfolio.

    Since transacting my first deal at age 18, I’ve built an 18-year track record of success as a professional CRE investor with the help and guidance of mentors who are legends in our business. Here are some of my favorite and most effective insider tips to help boost your numbers.

    Related: Tap Into the Wealth Potential of Commercial Real Estate With These 5 Tips

    1. ATMs

    Nearly every type of property has an area of 24 square feet that can be carved out with minor modifications. If you own property that has any commercial frontage or is located in a heavily trafficked pedestrian area, consider creating space for an ATM.

    In most markets in the U.S., average ATM space will typically lease for $500-$1,400 per month (as of the date of this publication) and requires an area of approximately 4’x6′. That is at least $6,000 in annual income for 24 square feet (or $250 per square foot).

    In areas with heavy pedestrian traffic, an ATM lease could bring $1,200-$1,400 per month, translating to an equity increase of up to $420,000. Talk to your local bank about placing an ATM in your location. Property owners may also choose to install an ATM machine of their own and collect fees on cash withdrawals, but such an operation requires hands-on management.

    2. Vending machines

    While the cash flow may seem negligible, vending machines can add a surprising equity boost to a property’s bottom line. Newer, more automated machines with card readers are more desirable. It’s easier to track income and profit with credit-debit purchases than with cash.

    You can either purchase machines or lease them. Monthly leases can begin at around $50 per month. For most products, profit is around 50%. With two machines, one for snacks and one for soft drinks, you could expect to sell approximately 300 items per month at an average profit of $0.75 per item. That’s a gross income of $225 per month and a net income of $125 per month (minus the $100 lease). While a net annual income of $1,500 seems hardly worth the effort, that’s a potential net equity gain of $20,000 for the property.

    There are many manufacturers that will either sell, finance or lease the equipment. If you choose to purchase or lease, there are reputable vendors offering state-of-the-art machines with favorable terms. Third-party vendors will also lease space in your property and handle all the stocking and maintenance for you.

    Related: How to Start Investing in Rental Properties — Your Step-by-Step Guide

    3. Coin-operated laundry

    In older apartment buildings without washer and dryer connections in each unit, property owners can potentially convert ancillary or otherwise unutilized space in the building (like a basement) into a coin-operated laundry facility.

    During the renovation of an old student apartment building close to NC State University, we converted an empty crawl space into a laundry room with four coin-operated washing machines and four dryers. I had 24 units in the building, most of which were two bedrooms, so approximately 48 residents. This simple amenity generated more than $1,000 per month. The extra $12,000 per year meant an instant equity gain of over $200,000.

    Most suppliers will offer financing or lease options for laundry equipment so you can get started with little capital out of pocket. Coin-operated washers and dryers can also be purchased from major home supply retailers, through Amazon or directly from equipment manufacturers.

    4. Parking

    I’ll give you a personal example: I purchased a church building a few years ago for $860,000. The building is 6,000 square feet and sits on a busy corner near lots of retail and where parking is scarce. I purchased it for the land value with the intent to demolish the building and develop a five-story mixed-use property. The existing building came with something unusual for the neighborhood: an underground parking garage with 21 spaces.

    Knowing the new development would take years, we rented out the parking spaces to pay the property taxes and carrying costs. With 21 spaces rented to nearby businesses at $100 per month per space, we generated $2,100 in monthly revenue, covering nearly half of the $4,500 mortgage.

    If we were to keep the building as a rental property, the extra $25,200 per year translates into $560,000 of additional equity in the building (at a 4.5% cap rate) — making up two-thirds of the $860,000 I paid for the entire property. While it may be difficult to purchase a standalone parking lot due to the demand for land, you can look for properties in infill locations that come with extra off-street parking. This additional revenue source can provide a welcome boost to your bottom line.

    Related: 6 Key Questions You Should Always Ask Before Investing in a Commercial Real-Estate Property

    5. Rooftop cell towers

    A cell tower requires as little as 50 square feet for installation. One rooftop tower can support as many as five carriers and 15 other digital antennas, generating up to $12,000-$15,000 in gross monthly revenue. That’s $6,000-$7,000 in monthly income on a 50/50 split with the supplier. The extra $72,000-$84,000 per year would result in an equity increase for the property of $1.4 million to $2.1 million, often with no out-of-pocket cost.

    Start by contacting American Tower, SBA and Crown Castle — the largest tower suppliers in the U.S. — to gauge demand for a tower on your property and try to get competitive offers. Most will structure their lease payments as a revenue split on the income from AT&T, T-Mobile, Verizon and other carriers.

    6. Freestanding cell towers

    Nearly all suburban developed properties have a 100’x100′ space where a freestanding cell tower can be placed. I’ve even seen some on footprints as small as 50’x50′. Dimensions, location and zoning are dictated by local ordinances, but if you can carve out a 5,000 to 10,000-square-foot section, a cell tower can potentially generate more monthly income than the property itself.

    Rental income or profit sharing on a traditional cell tower can range between $3,000-$8,000 per month based on population density. Even nominal income from a cell tower lease can have a major impact on your equity position and recapitalize in the event of a sale. As with rooftop antennas, cell tower installers and operators can tell you if there is a need for additional coverage where your property is located.

    This is the beauty of real estate: Small changes to cash flow create huge differences in property valuations, asset equity and the owner’s net worth.

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    Nikita Zhitov

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  • This Tech Will Transform Commercial Real Estate in 2023

    This Tech Will Transform Commercial Real Estate in 2023

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    Opinions expressed by Entrepreneur contributors are their own.

    3D digital twins have started to enter the real estate market and vocabulary, slowly moving from technical tools used in the operational processes to a more people-facing role. They become commercial tools of high value that stand as a commitment to innovation, adaptability and sustainability.

    In 2023 and beyond, I expect to see them evolve in how they impact and support the market. Commercial real estate segments — such as office or retail — have met great challenges over the past 2 years. Now, they are confronted with new expectations from their customers, and 3D digital twins can play a vital role in meeting them. This is why I expect these tools to evolve more and more to become a standard in real estate.

    After three years of focusing on digital replicas and their potential worldwide, here are the main directions I see 3D commercial digital twins developing next year:

    Related: Why Executives Need to Take Note of ‘Digital Twins’

    More resources for research and development

    The growth of the digital twin industry means an increased competitiveness among digital twin providers to offer the best technologies to their customers. Resources involved in research and development will grow in order to develop and integrate new AI, VR and AR-based technologies, optimize and automate processes and reduce costs.

    With renderings still having better graphics than most 3D tours, this could easily be a starting point for digital twin companies. The metaverses we have right now face the same challenge and as the two (real estate and digital universes) come closer, better graphics and immersive gamification features will be a must. Real estate has to be prepared for the future and for a generation of clients (Gen Z, millennials and even Gen Alpha) for whom mastering the digital space comes naturally.

    We will see digital twins more in commercial areas

    If until not long ago, digital twins were complex structures representing all technicalities needed in the building process, we are moving towards an era where they get fine-tuned for the public. Heavy-data replicas that required professional knowledge get a complementary partner: web-based 3D twins, easy to access and understand by anyone.

    These beautiful, branded and soon-to-be gamified replicas will play an important role not only in showcasing a space digitally in order to cut down research and negotiation times but also in divestment processes, facilitating the sale of a building. Furthermore, given the increasing number of refurbished offices (54% of new projects in 2021 in London were office refurbishments), digital twins can be put to very good use here, too — presenting and pre-leasing a future space.

    Related: Into the Metaverse: How Digital Twins Can Change the Business Landscape

    We’re moving towards digital universes

    The enterprise metaverse as a concept isn’t something new anymore. Real estate companies might soon enough have their whole portfolio digitally replicated in a web, virtual platform. This would favor especially large developers or the ones with mixed asset classes (office, residential, retail, logistics, etc.).

    These universes would present spaces and their specific features in a company’s one-stop-shop, starting from a state-of-the-art 3D digital twin.

    A digital twin-based real estate universe would make sense not only for existing assets but for ones in the projecting or building process. Think about new cities being built from scratch, such as The Line or the New Administrative Capital of Egypt. Presenting these projects or any future construction works to interested stakeholders can give a clearer picture of the aimed result and facilitate investments.

    Costs will be reduced as more AI will be involved

    In the following year and beyond, I expect to see more advanced AI-enhanced features being used in the development of 3D digital twins, as well as more IoTs, such as high-end sensors being used in the generation of these replicas.

    We’ll be taking steps towards automated generation and almost-simultaneous updates of the twin — if a physical space will change, its digital version of that should (almost) immediately update. This will translate into more automation, but less manual work, time and budget spent on alterations, and consequently, lower costs.

    Related: How Disruptive Technologies Are Changing the Way People Invest in Real Estate

    More features will be available for more connectivity

    A 3D digital twin of an office will cease to be just a replica. It will turn into an integrated administrative tool that will allow stakeholders to make comments and notes about different features or challenges they’d like to see solved. Tenants will be able to book a meeting call or a certain desk directly from the digital twin or even join a virtual office. Tenant experience and building management solutions will be integrated as well, in order to streamline as many processes and offer the market a complex solution, with multiple easy-to-use features.

    What this will lead to, eventually, is turning the 3D digital twin into a more elaborate environment than the actual physical space. This might align just perfectly with the future of work, where the office will be more of a collaborative, social space, designed to bring people together not only to work together but to connect as well.

    Meeting the new generation of workers’ requirements

    There are two aspects to consider regarding the future of work, and consequently, of the office:

    • With digital nomad visas becoming a thing, at least among European countries, people are not necessarily giving up on having an office, but they do want more flexibility. For them, it has to be as easy as possible to explore a space online, ask for an offer, access a virtual office or book a meeting room;

    • When it comes to moving to a new office, the decision within a company is not taken by real estate people anymore. Marketing, HR, sales and customer success representatives want to have a saying in where a company is relocating. This means that for them, seeing a space and its potential fit-out in 3D digital twin and not on 2D plans or renderings might make or break a deal.

    Digital twins will have a real impact on ESG

    Transport is responsible for approximately one-fifth of global carbon dioxide emissions. People travel for many purposes, and choosing an office or buying a home at a distance is one of them. This, together with the printed materials, are two of the main areas where digital twins can have the most powerful and visible impact. Showcasing/choosing a space digitally can reduce travel and printed advertising, offering a great, sustainable alternative.

    Furthermore, in the EU alone, buildings account for 40% of all energy consumption, which means there is a lot to improve in how real estate uses and recycles energy. Digital twins can easily become part of the monitoring, test-running and managing processes, helping landlords allocate resources better and show where there’s room for improvement. Better monitoring of any type of data is key in a fast-changing environment.

    To conclude, I would like to emphasize what connects all the ideas I developed above: adaptability. More than anything, the real estate industry is at a turning point where players get to decide if they go digital or stick to the old ways. Change is inevitable, and I see 3D digital twins as a central part of what new processes will mean. Although they have yet to prove their full potential, I don’t think there’s room for questioning if they make sense. While I strongly believe in the power of real-life interactions, at the same time, I think real estate can’t count solely on these anymore. The industry must try to find and use the right mix with digital environments.

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    Bogdan Nicoara

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  • 8 Real Estate Questions To Ask Potential Franchisors

    8 Real Estate Questions To Ask Potential Franchisors

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    Opinions expressed by Entrepreneur contributors are their own.

    There are many reasons why entrepreneurs may want to buy a franchise. Making a brand successful is a tremendous amount of work in today’s world. Competition for consumer dollars is fierce. It can be challenging to elevate a brand and achieve profits. These profits will stem from a well-thought-out and strategic business plan.

    The beauty of buying into a franchise is that the brand is already proven. Also, franchisees can benefit from the franchisor’s assistance in navigating the business’s challenges. As for specific profits, each franchisor should disclose sales and estimated earnings in their Franchisor Disclosure Document, often referred to as an FDD.

    Before buying a franchise, here are eight essential questions to ask.

    Related: Thinking of Buying a Franchise? These Four Industries Are Flaming Hot Right Now

    Does the franchisor have a dedicated in-house real estate department?

    If a franchisor has paid corporate staff whose sole purpose is to assist their franchisees with the real estate process, then the franchisor gets a star in my book. The franchisee will typically have a real estate broker represent them in selecting a site and negotiating the deal. However, the in-house real estate manager is vital to assisting the franchisee’s broker. The in-house real estate manager will provide the franchisee’s broker with detailed site criteria tailored to the franchised branding requirements.

    How do the real estate department and support staff size compare to the franchise sales department?

    Of course, franchisors need a sales department to sell franchises and grow their brand. Nevertheless, it is a good idea for a potential franchisee to know the size of the franchisor’s sales department. It might be a red flag if a company has an extensive sales department and little support staff for the franchisees.

    Related: Looking to Buy a Franchise? Here’s How to Start

    Does the franchisor have a real estate approval process?

    The majority of franchisors will need to approve a franchisee’s location. The approval process always needs to happen before a franchisee signs a lease. If the franchisor does not have a method of approving the site where the franchisee’s business will be, then the franchisee should be concerned. Not having an approval process could mean that the franchisor is in a hurry to open locations and does not have the quality of the sites as a top priority.

    Does the franchisor have a letter of intent template?

    The letter of intent is the framework for the lease. Most of the main deal points for the lease are in the letter of intent. These include base rent, additional charges, rent increases, lease length, options, tenant improvement allowance, landlord delivery, free rent and the rent commencement date. Additionally, in the letter of intent are the tenant’s use clause and the franchisor’s recommendation on necessary exclusives. The tenant must let the landlord know what use they will lease the space for, and the franchisor should provide this use language. The franchisor should also spell out exactly what they want regarding an exclusive. Exclusives protect the tenant from a landlord leasing to a competing tenant of the same use.

    Does the franchisor have a landlord’s work letter?

    The landlord’s work letter defines the conditions for delivery of the premises. Specifics to utility requirements (electric, water, & gas), heating, ventilation, and air conditioning (HVAC ), number of restrooms, flooring, and ceiling are just a few of the items covered in the landlord’s work letter. If the franchisor provides their franchisee with a landlord’s work letter, it will show experience.

    Related: The 5 Types of People You Need To Start a Business

    Could the franchisor provide a map outlining the franchisee’s territory?

    When buying a franchise territory, the franchisee will want to know specifics of where they will be able to open their business. If the franchisor does not provide a map showing this exact area, I recommend asking for one.

    Additionally, ask the franchisor how many other franchisees have purchased territories in the area. It would help if the franchisee also asked the franchisor what protection is offered to prevent another franchisee from opening adjacent to their territory. Finally, ask specifically how close another franchisee can open to an existing store. Sometimes I see franchises expand too quickly, which can hurt profitability.

    Once a franchise agreement is signed, how long does the franchisee have to find a location?

    There are two viewpoints to this question. The franchisor wants people to refrain from buying up territories and not opening stores. The franchisee only wants to open a store if the desired real estate is available in their territory. The franchisee needs to understand if there are consequences and what those consequences are if they purchase a region and do not open the store(s) they agreed to in their franchise agreement.

    Related: 5 Major Deal Points to Know Before Signing a Lease

    After purchasing a territory, can a franchisee trade territory?

    This one depends on how many franchisees the franchisor has. Most of the time, I see franchisors work with their franchisees if the franchise wants to trade territories. For example, the franchisee could wish to change territories due to a lack of quality real estate, or they may need to move their residence. It is advantageous for a franchisee to find out before signing a franchisee agreement about the possibility of changing territories.

    Purchasing a franchise is a decision that should require much thought. I also recommend potential franchisees speak to many existing and ex-franchise owners of the brand in question. The more questions asked in advance, the better-equipped one will be to run a successful business.

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    Roxanne Klein

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  • A New Variation On An Old Problem For Subcontractors In New York

    A New Variation On An Old Problem For Subcontractors In New York

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    For decades, construction contracts and subcontracts—both in New York and elsewhere—seem to have attracted more than their share of payment disputes. Owners regularly run out of money. Contractors and subcontractors regularly screw up (and run out of money). Projects regularly go over budget—but rarely stay under budget—and regularly fail (often because they ran out of money).

    In response, New York, like most other states, allows contractors and subcontractors to file mechanics’ liens against projects if not paid. Those liens can eventually be enforced just like foreclosing a mortgage. Mechanics’ lien laws give contractors and subcontractors a very powerful collection technique not available to ordinary creditors, such as unpaid real estate lawyers.

    Contractors tried to reduce their exposure to some of these risks by adding “pay when paid” clauses to their subcontracts. Those clauses said that the contractor didn’t have to pay the subcontractor unless the owner decided to pay the contractor. It was a great mechanism for the contractor to shift the risk of nonpayment to its subcontractors.

    The New York courts decided that the mechanism was too great to actually work. It flew in the face of the New York mechanics’ lien law, which said that any waiver of the right to file a mechanic’s lien was unenforceable. And, the courts said, a “pay when paid” clause amounted to a back-door waiver of the subcontractor’s right to file a mechanic’s lien.

    In 2002, the New York Legislature complicated these issues by deciding that the relationship among owners, contractors, and subcontractors required further improvement. The legislature passed a law that set standards and procedures for how and when owners are supposed to pay contractors, and contractors are supposed to pay subcontractors. The law unambiguously required the contractor to pay its subcontractors whether or not the owner paid the contractor. The owner’s nonpayment shouldn’t be the subcontractors’ problem, according to the legislature.

    The 2002 law did, however, carve out an exception: If the owner appointed an agent to act for the owner in signing contracts, then the agent wouldn’t be responsible for any payments due under those contracts. That conforms to traditional principles of the law of agency.

    At least one smart contractor tried to use this exception to create protections similar to a “pay when paid” clause. That contractor inserted new language into its subcontracts, requiring each subcontractor to acknowledge that the contractor merely acted as an agent for the owner, so only the owner was responsible for payment. The owner’s payments would, of course, run through the contractor on the way to the subcontractor, but the contractor was still just an agent for the owner—a channel for payment—without liability.

    It didn’t work. A court decided that the contractor couldn’t shrug its shoulders and claim to be nothing more than the owner’s agent. Instead, the rest of the subcontract made clear that it was a separate and independent contract between the contractor and the subcontractor. The subcontractor signed the contract in its own name. The subcontractor’s obligations ran to the contractor, not the owner. The contractor couldn’t escape liability by claiming it was an agent.

    Although this contractor lost its litigation with the subcontractor, the “agency” theory just might work in a future subcontract. A contractor would need to play it through thoroughly. The contract would need to make clear throughout that the contractor is a mere innocent “agent” of the owner, and signs and acts only in that capacity.

    If the contractor were in fact a construction manager, then such agency status makes sense. In a traditional general contract arrangement, however, where the contractor expects to make a profit after paying subcontractors, it’s not so easy for the contractor to claim to be the owner’s agent. Contractors may have to come up with some other solution to the problem.

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    Joshua Stein, Contributor

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  • What’s Missing From This Real Estate Contract?

    What’s Missing From This Real Estate Contract?

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    When participants in real estate and other business transactions negotiate their contracts, they think about what might happen later and what legal consequences should arise from those events or circumstances. For example, a contract might prohibit a party from doing something. It might also say that if a party wants to do something, then the other party has certain rights, such as a consent right.

    Those provisions often focus on whatever the parties have on their mind, but they sometimes don’t go as far as they should. The net result of this failure is a gap that allows one party or the other to do something that, if the parties had thought to address it in their contract, would likely not have been allowed. This deficiency seems to arise most often in contract language relating to transfers.

    As one very common example, many leases and other contracts restrict the right of a party to assign the contract, or in other words bring in someone else who would take over that party’s rights and obligations under the contract. Sometimes a contract or lease assignment requires the other party’s consent. Other times no consent is needed if the assignment meets certain tests.

    In one recent Delaware case, a contract said that a party could not transfer its rights or obligations under the contract “by assignment, … merger, consolidation, … [or] change in management or control” of that party. The party subject to that assignment restriction was owned by a holding company, which was in turn by owned by another holding company, which was in turn owned by a second holding company—essentially a great-grandparent company.

    That last company, the great-grandparent, was the subject of a corporate merger that resulted in a change of control and a replacement of managers at all levels throughout the enterprise.

    The other party to the contract argued that the corporate merger of the great-grandparent amounted to a prohibited transfer of the contract. The court disagreed, concluding that the merger happened at the great-grandparent company level. The contract itself wasn’t transferred by merger or any other way. The contracting party remained as the exact same entity owned by the exact same holding company.

    That’s perhaps not what the parties (or at least one of them) had in mind when they wrote their anti-transfer language. When they referred to a “merger” or “change in management or control” they might have been thinking about possible corporate transactions anywhere in the ownership structure. But that’s not what they said. They just referred to a “transfer” of the contract by various possible means. One of those possible means of “transferring” the contract was a merger, which would have captured the case where just the specific contracting party merged into another entity and transferred the contract as part of the merger. Technically, though, that’s not what actually happened. What actually happened was something else, beyond the scope of the restriction that the parties had negotiated.

    The transfer prohibition in the contract sounded quite fierce and extensive in theory. In practice, though, it didn’t accomplish whatever the parties may have wanted it to accomplish. This happens with astonishing frequency, creating openings for contracting parties to do things that the other party might perceive as being inconsistent with the “spirit” of the deal.

    When attorneys and their clients negotiate contracts, they need to watch for these sorts of gaps and openings. Perhaps they’re intentional, but perhaps not. In contract negotiations, it can help to go beyond the words in the document and think about the wide range of possible events that might happen, and then make sure that the words capture everything they should capture.

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    Joshua Stein, Contributor

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  • 7 Secrets Home Buyers Must Know

    7 Secrets Home Buyers Must Know

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    Opinions expressed by Entrepreneur contributors are their own.

    The millennium brought about so many first-time home buyers across the globe deciding to go big. Many young generations no longer depend on the old folks for shelter. They have now moved into making huge investments at once. Unlike the older generations’ approach of starting small and growing gradually, the modern first-time home buyer has more risk appetite and is making big decisions.

    Nonetheless, it is crucial to analyze the market trend, highlight the home buyers’ tastes and preferences, have a contingency budget, review the property location, conduct due diligence on the realtors and have an informed review.

    Related: 4 Lessons I’ve Learned in 10 Years of Building a Luxury Real Estate Brokerage

    1. Analyze the market trend

    It’s not all that glitters is gold. We all like taking photos that highlight more of our solid features and less of our weaknesses. The photogenic approach taken on a property often does not highlight everything. It’s paramount for the buyer to visit the property and do their reality check. Sometimes real estate agents modify photos to show bigger spaces, great interior designs, and features, which may not be the case in real-life situations. Before making that significant decision, it’s essential to visit the site before reaffirming your decision.

    Besides, the pricing often is used to entice the buyer into purchasing the property. Although it’s believed that the higher the price, the more sophisticated the property is. Nonetheless, that may not be the case. Therefore it is essential to compare the market trend, pricing and photos and do a reality check before moving.

    Related: How NFTs Could Change Real Estate

    2. Highlight your taste and preference

    Purchasing your luxurious home requires a considerable investment. The chunk of money to be invested should correspond to satisfying your desires on what and how you want your home to look. It is important to emphasize to your realtor what features are most important.

    3. Create a contingency budget

    As much as your most preferred luxurious home may look, it may not have all the features you may require. As a result, it is crucial to set aside some contingency funds to cater to what is missing. Contingency funds are also significant to cater to additional costs, which the realtor often does not highlight at the purchasing time.

    4. Review the property location

    Purchasing a house is a big decision and should therefore require enough due diligence before purchase. As a result, it’s essential to get to know your neighborhood, how secure it is and if it’s a beach house, the distance from the beach, and the strategic location to all the essential facilities such as the market, school, hospital and recreation places. Infrastructure, accessibility and drainage are also some of the vital features to take into consideration.

    5. Know your realtor’s experience

    Purchasing your luxury home through a highly experienced realtor will guarantee efficiency in your home ownership journey. The National Association of Realtors offers certification to ensure home buyers deal with highly experienced real estate agents. The realtor should be attentive to fine details about the exact specification of the features that the home ought to have.

    An experienced realtor would be mindful of the standard prices for the apartment, which would help them negotiate for you a fair price. You want to purchase a home that meets the government‘s housing construction standards. Buying an apartment that does not meet the housing construction code puts you at risk of demolition. An inexperienced realtor would not be able to draft binding contracts with the building’s seller risking you losing your house.

    Related: How to Up-Level Yourself as a Realtor

    6. Do a thorough investigation of the home

    Require analysis to establish that the home does not have faults that could further cost you. Electricity connection checks are paramount because having flaws could cause a fire outbreak that could destroy your apartment, leading to financial loss. You also need an engineer’s recommendation to understand whether the building’s foundation was rightly constructed. Cracks in the foundation or the walls could cause the building to collapse, leading to losses. Before purchasing your luxury dream home, it would be necessary to ascertain whether the construction adhered to due diligence.

    You should also assess the security of the area where you intend to purchase your dream home. The government’s insecurity data would help ascertain whether the place where your luxury home is located is safe. The government’s crime rate statistics would help you identify areas prone to burglaries and assault. Purchasing a home in an area with a high prevalence of crimes would cause you to live in constant fear, denying you peace of mind.

    7. Your realtor’s review matters

    Many realtors are driven by their gain more than by giving their clients what they want. Therefore, the home buyer must do a background check on their realtor and their reviews.

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    Chris D. Bentley

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  • Bergen County, NJ, Innovative Senior Housing Community Design Completed and Is Open for Business

    Bergen County, NJ, Innovative Senior Housing Community Design Completed and Is Open for Business

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    Pike Properties LLC announces the opening of Thrive at Montvale Senior Living Community.

    Press Release
    –

    Aug 1, 2022


    MONTVALE, N.J., August 1, 2022 (Newswire.com)
    –
    Pike Properties LLC, a subsidiary of Pike Construction Co LLC, has announced the completion of Thrive at Montvale Senior Living Community in Montvale, NJ.

    Thrive at Montvale is an innovative, state-of-the-art senior complex with luxury design features that encourage social interaction.

    A large social courtyard is at the heart of the design philosophy, which includes an outdoor dining facility, a large fountain, fire pits, bocce courts, and an outdoor movie theatre, all designed to unite community members.

    In the center of the social courtyard is the hub. The hub provides a shady, open-air structure where residents can play cards, read or congregate. A greenhouse is also part of the hub design where residents can garden all year.

    “Looking more like a luxury resort than a senior housing complex, this facility is not typical of senior housing in the region,” according to David Weiner, Managing Member of Pike Properties.

    Thrive at Montvale is a 215,000 sq ft facility comprised of 203 rental units, 90 independent living units, 81 assisted living units, and 32 memory care units.

    Thrive at Montvale is the first project of a partnership between Thrive Senior Living, Atlanta, GA, and Pike Properties LLC.

    Thrive Senior Living operates the facility and provides management and marketing services. Thrive was also the primary driver in the design philosophy, making this community facility unique to the region.

    Pike Properties LLC acquired the property, codeveloped the project along with Thrive and acted as the contractor on the project, which broke ground in October of 2019.

    With the assistance of Cushman & Wakefield, the project funding was provided by Wells Fargo as the Senior Lender and AEW as the capital partner.

    The project was delivered on time and within budget, despite supply chain and personnel challenges due to the pandemic. Pike has a long and uninterrupted tradition of delivering projects on time and within budget, and this tradition remains uninterrupted, even during a pandemic.

    This project was completed in April of 2022 and is now accepting residents.

    Thrive Senior Living and Pike Properties have several new projects planned with prospective Senior Housing Developments in Morris and Somerset Counties.

    Pike Construction and Development is a family-owned company based in Paterson, New Jersey. Pike is a general contracting and real estate development firm established in 1958. Since its inception, the company has built more than 15,000 senior housing units ranging in project size from $10 million to over $150 million in total construction costs.

    CONTACT: David J. Weiner
    973-278-2300 – djw@pikeconstruction.com

    Source: Pike Properties LLC

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