The Blueprint To Commercial Real Estate Investing: Your Guide To Make Sustainable Stream Of Passive Income Through Smart Buy: Achieve Financial Independence.

By Michael Henry

Your Guide To Make Sustainable Stream Of Passive Income Through Smart Buy

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• Language: English
• Publisher: Michael Henry
• Release date: Sep 18, 2020
• ISBN: 9780460332545

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The Blueprint to Commercial Real Estate Investing

Your Guide to Make Sustainable Stream Of Passive Income through Smart Buy

Michael Henry

Copyright 2014 by ______________________ - All rights reserved.

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Table of Contents

Introduction:

What This Book Will Cover?

Who is This Book For?

Key Terms-Retail:

Retail Strip Centers:

Neighborhood Shopping Centers:

Power Centers:

Regional Malls:

Key Terms-Office:

CBD Office Space:

Suburban Office Buildings:

High-Rise Office:

Creative Office Space:

Key Terms-Multifamily:

Garden Style Apartments:

Mid-Rise Apartments:

High-Rise Apartments:

Key Terms-Industrial:

Heavy Manufacturing Properties:

Light Assembly and Bulk Warehouse:

Flex Space:

Key Terms-Hotels:

Full Service Hotels:

Limited Service Hotels:

Extended Stay Hotels:

Other Asset Types:

How to Measure CRE?

The Stacking Plan:

Measuring Commercial Rent:

NOI and Cap Rate Introduction:

Pro Rata Share:

NNN Leases:

FSG Leases:

Modified Gross and Base Year Stop:

Percentage Rent:

Leasing Costs:

CRE Lease Terms:

CRE Economics-Gross Potential Rent (GPR):

Economic and Physical Vacancy:

CAM Reimbursements:

RUBS System:

Ancillary Income:

Credit Loss and Bad Debt:

Common Area Maintenance (CAM) Charges:

Non-Controllable Expenses:

Utility Expenses:

Property Management Fees:

Tenant Improvement Allowances:

Leasing Commissions:

Capital Expenditure Reserve:

Free and Clear Cash Flow:

Sourcing the Loan:

Loan Terms:

Supplemental and Mezzanine Debt:

CRE Loan Covenants:

CRE Loan Sizing:

Loan Sizing – LTV:

Loan Sizing – LTC:

Loan Sizing – DSCR:

Loan Sizing – Debt Yield:

Loan Sizing Based on Constrains:

The Time Value of Money:

Capitalization (Cap) Rate:

Unlevered Cash on Cash Returns:

Unlevered IRR:

Unlevered and Levered Equity Multiple:

Capital Risk Buckets:

CRE Tax Strategies Interest Expense Deduction:

Depreciation:

1031 Exchanges:

Cash Out Refinance:

Reversion Value Projecting Exit Cap Rate:

Value Add Profile and Impact on Exit Cap:

Replacement Cost:

Risk Free Rate Plus Premium:

CRE JV Structures:

CRE JV Fee Structures:

CRE Equity Waterfall Structures:

How to Use This Information?

Conclusion:

Introduction:

Welcome to commercial real estate investing, whether you're looking to buy multifamily properties, retail shopping centers, office buildings, or industrial properties, this book was really designed to take you from complete beginner in commercial real estate investing all the way to commercial real estate investing professional.

This book was really meant to be the resource that I wish I had when I was first starting out, not the academic stuff that doesn't matter but the real stuff that you're going to use in real life, whether you're working in commercial real estate as a commercial real estate professional, or you're investing on your own to build your personal portfolio and Passive income.

This book is really meant to teach you everything you need to know to get started in commercial real estate investing all the way from all the different product types to different commercial real estate, finance and investment metrics, all the way through the more complex and advanced topics like waterfall and promote structures.

This book is perfect for college students, graduate students or career switchers that are looking to break into the commercial real estate investment field, and also for aspiring commercial real estate investors and entrepreneurs that want to go out and buy commercial real estate properties.

This book is also perfect for passive real estate investors that want to invest in Crowdfunding or other passive real estate investment opportunity. This is really the resource that I wish I had when I was first getting started, really all of the things that you need to know whether you're looking to break into the commercial real estate finance industry as a professional or you're looking to buy your first deal on your own.

This book was really designed to really be an MBA level course, it was really meant to bring together the basic concepts that you're going to need to know in commercial real estate investing, but also with practical experience.

So a lot of commercial real estate investing books that are taken in an academic setting are great but they're too academic and you're not really getting any sort of practical experience or application from that. So my goal is to take an MBA level curriculum and really condense it into the things that you really need to know if you're going to break into commercial real estate in your career, or you want to buy commercial real estate on your own.

So it's an introductory MBA level curriculum, but with practical applications that you can use, whether you're looking to break into the industry and become a commercial real estate professional, or you're planning to do your first deal.

So the way that i set this up was really as a guidebook to be the resource that i wish i had when i was first starting out when I first started in commercial real estate investing, when I first started working in the commercial real estate field, this is what I wish I had when I didn't really know much about any of this.

So I'm excited to dive in. I hope you get a lot out of this book. Thanks so much for being here. And let's get started.

What This Book Will Cover?

So what is this book actually made up of and what we are going to cover? Well, number one, we're going to start with commercial real estate product types. And what I mean by product types is the different kinds of commercial real estate that you might see and you might invest in.

So, these are apartment buildings, these are retail properties, office buildings, industrial warehouses, hotels, and other different types of commercial real estate product types. And we're going to talk about each and what they're made up of.

Next, we're going to dive into commercial lease structures. So how is a commercial lease structured from an economic point of view? And how does that affect your financial projections, your underwriting, your financial modeling, when we're looking at a new real estate deal.

After that, we're going to jump into commercial real estate revenue drivers. So how do commercial real estate properties drive revenue and generate revenue for ownership, not just from a rental income point of view, but also from ancillary or other income sources.

So whether that's an apartment building, generating pet rent or storage fees, or from a retail or office building, that's generating some sort of CAM reimbursements, we're going to talk about what all of those things mean and how to incorporate those in your commercial real estate financial analysis, then we're going to do the same thing for commercial real estate expense drivers. So what drives expenses at commercial real estate properties? And how can you manage these in order to make your investment more profitable and to look at your investment when you are analyzing a new deal, and analyze those expenses, and understand how you can make your deal more profitable by changing certain expense drivers.

After that, we're going to jump into commercial real estate capital items. So we're going to talk about things like tenant improvement allowances, how to calculate those and how those are going to affect your returns in your economics and financials when you're looking at a new deal.

And we're also going to jump into things like construction costs, and leasing commissions, and how those are going to be incorporated into your commercial real estate financial analysis. So once we've gone over revenue, expenses and capital items, we've gone through a large majority of your income statement, and how you're going to model your commercial real estate deal.

So what we're going to do then is move into institutional level financial analysis. So how do the biggest private equity firms and largest most sophisticated and small sophisticated real estate private equity investment firms look at commercial real estate deals? And how can you look at commercial real estate deals on any scale in the same way? So what are the metrics that they're looking at?