White Mountain Commercial New:
By James M. Maloney
Genesis Real Estate and Development, Inc.
Where to Find the Hot Deals of 2011
Look for smaller, lower quality assets that need value add. This is where the bargains will be when buying commercial real estate because for the last couple of years, owners have been holding on and hoping for a market rebound. The continued recession that plagues our real estate market (despite what Mr. and Mrs. Obama tell us) has owners finally coming to the realization that their assets have lost value, and in order for them to sell, they need to significantly drop prices. This is the reality in our current market. Larger, stronger assets have seen price adjustments, but nothing like the smaller assets.
If you’re looking for a significant ROI, there are plenty of opportunities in our region. There are several investment properties with over 10% CAP rates, and 20% Cash on Cash returns. Even with the Dow Jones Industrial Average elevated above the 12,000 mark, returns from the stock market would be difficult to match these local returns. Some of these smaller assets also have very strong tenants with long leases which guarantee these returns. Due to the age of the assets and restraints from banks, people have been reluctant to invest in these properties. However, buyers that have cash can bypass banks stringent financing requirements and take advantage of these significant returns. In addition to cash buyers, many owners of these smaller, lower quality assets are agreeing to owner carry backs with very favorable returns.
For more information about investing in the White Mountains, please visit my website at www.GenesisPinetop.com where I periodically write a blog about Real Estate in The White Mountains.