Valuation Methods in Commercial Real Estate, Part 2 Written by Darren McCorkle Last month we talked a bit about capitalization rates (aka cap rates), a valuation method commonly used in commercial real estate. It is certainly a valuable tool, but it is far from perfect. Luckily we are not completely out of options. Internal Rate…
CAN LEVERAGE ACTUALLY BE THE MORE CONSERVATIVE APPROACH TO REAL ESTATE INVESTING? I would suggest that maybe a realistic level of debt may actually be a more conservative approach in real estate valuations today. I’m not suggesting that one loads up with 80% financing or a paltry debt service coverage of 110% or so, but what I would…
Better than corporate bonds? Buying an investment grade corporate bond certainly sounds like a sound investment, but is it really in light of the financial crisis we just endured? Many companies didn’t survive and when that happens your corporate bond is as worthless as the paper its printed on. The only guarantee that you have…
Latest Market Conditions of Commercial Properties The commercial real estate market, at least in Naples, Flordia, probably found the bottoming of valuations in 2011. In 2012, valuations have quickly firmed up. While unrealistically deep discounts on properties are largely a thing of the past, that doesn’t mean there still aren’t good opportunities out there…it’s just that a fair degree of…
Income Properties come in two flavours Searching for investment properties in Naples and Southwest Florida, like much of Florida and the US, can largely be split into two categories: distressed and troubled assets, and “core” assets. The distressed assets, largely bank owned or soon to be bank owned can be distressed for a variety of reasons,…
Time to sell or time to buy? Flip a coin! If you read my commentary of February 19,2012 , I had made the assertion that this is a somewhat unique time in the business and economic cycle where one could make strong arguments why its a great time to be BOTH a buyer and a…