7 Benefits of Retail Property Investing


The Worcester, Mass. retail industry is picking up, but what are the real advantages of getting in as a commercial real estate investor and owning one of these properties?

Various retailers are busy expanding in the Worcester, MA market. Recent statistics show stores experiencing rising sales, and while slow the economy and employment is improving. This is all great for store owners, but there are many more benefits for those investing in the actual real estate they rent.

These include…

1. Timing

There really couldn’t be a better time to invest in retail property. It is really just warming up. As a whole the U.S. real estate market is just now getting back to ground zero. Based upon historical cycles this means another 7 to 15 year growth cycle coming up. With retail just catching on again this means it should also provide investors the longest growth cycle of property sectors going forward.

2. Diversity [Income Streams]

The need for diversity in a portfolio is no secret. The beauty of retail whether it is a local strip mall or a massive shopping center is that it offers additional diversity within a single investment with multiple sources of income. This provides for consistency in returns and avoids relying on the performance of a single tenant.

3. Diversity [Industry]

Perhaps even better than the above multi-tenant retail investments offer the advantage of diversity of a variety of industries. Everything is cyclical, you can’t stop that. But you can defend against it and maximize returns through it. If one tenant’s industry or even real estate in general is taking a beating it doesn’t have to affect investment returns providing a good mix is maintained.

4. Truly Passive Income

So many investors get into the residential rental market as landlords in search of passive income, only to find it is anything but. With the assistance of a full service Worcester property management company retail can deliver truly passive income that turns in positive cash flow month after month without ever having to lift a finger (or a plunger), or field a single tenant phone call.

5. Passive Wealth Building

The high yields and regular cash flow retail can deliver isn’t even the best part. With this timing and even modest appreciation commercial real estate investors stand to benefit from ongoing passive wealth building at the same time.

6. Control Over Value

While there are certainly macro factors at work too, investors of retail properties have far more control over their own property values than most other real estate investors. Value can be added at any time in any phase of the market cycle through improvements and positioning.

7. Security

Looking at the extreme volatility of the stock market from recent IPOs like Twitter’s it’s clear that the security of a tangible direct investment in brick and mortar retail is an essential haven for everyone to have in their portfolio.

Technology Trends & Massachusetts Real Estate

Image processed by CodeCarvings Piczard ### FREE Community Edition ### on 2015-01-10 09:35:08Z | http://piczard.com | http://codecarvings.com

How is technology changing the real estate industry and best practices for Massachusetts commercial real estate investors and owners?

Technology is developing faster and faster and so is its adoption in the real estate industry by all sides. Some have survived until now without fully embracing it, but this no doubt already impacting competitiveness, which will snowball in the New Year.

So let’s look at 7 factors and tech trends which will shape the market and returns over the next 12 months…

1. Google+ Earns its Street Cred

Despite being widely recognized as the ‘suit’ of social media, and the platform for serious deal making, many real estate industry professionals have been slow to adopt. This is changing fast with major players like RealEstate.com using it, and the CCIM Institute heralding the benefits of Hangouts and G+ for boosting online lead generation.

2. Blending On and Offline Processes

Shopify’s recent predictions for 2014 and what it calls the ‘Democratizaion of Retail’ call for a continued blending of online and offline communications, sales and processes. Expect consumers to jump between virtual and reality when shopping for apartments, offices and retail units to rent as well as everyday shopping.

3. Virtual Home Staging

Several major publications including the Wall Street Journal and Inman News have recently run pieces questioning the value of staging today. One report indicated new data may support it helping to move units faster, but not necessarily for more dollars. Virtual staging services may make all the difference here; providing a loss hassle, low cost option for presenting office, retail and rental units in the best light, with customization tools.

4. 100% Mobile

Venture Beat recently stated that some small businesses might as well go 100% mobile with their marketing in 2014 as mobile web traffic out paces desktops. Those with the best mobile sites, optimized content and tools to maintain engagement could easily come out on top. Fortunately this could be far more affordable and profitable than old school marketing methods. Building owners that get this can also enjoy higher profit margins and returns.

5. Search Engine Rankings

As the public continues to migrate toward becoming digital natives search engine rankings are only becoming more important. However, at the same time Google and other search giants are making it crystal clear they are serious about quality, and shaking out those that try to scam the system or spam the world with junk.

6. Crowdfunding

Crowdfunding continues to grow in popularity with new platforms offering new options and investors taking to it as a better option than conventional real estate stocks and funds. For Massachusetts commercial real estate investors this can be a great platform for raising capital quickly and affordably to take down new and larger deals.

7. Augmented Reality

While some market leaders are already integrating augmented reality applications, 2014 is expected to be the year it really goes main stream and catches on with the public and advertisers.

How To Maximize The Odds Of Successfully Crowdfunding Real Estate Deals


What are the secrets and science behind the most successful crowdfunding campaigns, and what separates them from the thousands which fail?

Crowdfunding continues to soar in popularity, especially for commercial real estate investment. It not only trumps partial interest investments, which the CCIM Institute recently called “real estate’s most difficult sale”, as well as avoids the hassles and high, yield crippling fees of borrowing, but can be far more rewarding in other ways too.

Of course while the media often likes to highlight the hype and effortless speedy success of some crowdfunding ventures, not everyone sees the traction they hoped for. According to Forbes and PC World only 56% of campaigns actually reach their funding goals. This are pretty good odds, but for most commercial real estate investors and those with a hot retail property deal, a contract inked and deposit money on the line these odds are still too big of a risk to stomach.

Fortunately, there are ways to dramatically increase the odds of success. This includes both monitoring and modeling winning campaigns and taking advantage of the metrics provided by platforms like Kickstarter and Indiegogo.

Here are 15 factors that can make your commercial real estate crowdfunding efforts better:

  1. Test, and drive interest for your project on social networks before going live
  2. Drive social interaction and sharing throughout by encouraging shares as a form of contribution for those not prepared to give financially
  3. Email everyone in your contact list with a direct message
  4. Distribute your own press release to garner international attention
  5. Gather support from local real estate professionals (who can eventually profit from the project in one way or another)
  6. Indiegogo suggests listing multiple team members dramatically increase funding results
  7. Create attractive perks and use discounts and giveaways from retail tenants to make contributing more attractive
  8. Break funding into multiple stages for example; deposit, acquisition, improvements
  9. Use video to make your campaign standout
  10. Highlight the positive impact the project can have on the local community
  11. Advise potential contributors what happens if you don’t get fully funded; will you stil proceed or will they get their money back?
  12. Use a professional copywriter to explain the benefits of what are they getting to be a part of – cool, social good, valuable perks, a legacy project
  13. Layout a timeline with short and long term milestones versus a far off completion date
  14. Post regular updates to keep donors engaged and sharing
  15. Recruit and list the professional, third party, full service retail property management firm you will be using in order to instill confidence

How Can A Property Management Company Help Investors Minimize Risk?


Despite the fact that legendary investors and real estate industry heavy weights like Warren Buffett would never be caught dead managing their own properties, and would never have attained the level of success they have if they had stayed small many investors continue to put off leveraging the advantages of a full service property management company.

The financial benefits of enrolling the help of a professional property management firm for handling day-to-day activities and boosting returns is just basic math. Some still struggle with balancing this boost to yield and total returns with the fear of giving up micromanaging. This is almost understandable, well at least the fear can be.

However, one of the most significant and underappreciated benefits of having a property management company as a part of your team is actually for minimizing risk and liability. Some have downgraded general risk as a concern due to the incredible real estate rebound that the U.S. is experiencing. Still, no matter how large the portfolio or reserves it can all be lost very rapidly without proper risk management, and the danger is even worse for smaller investors.

So how can a property management company aid investors in minimizing risk?

6 reasons not to invest in income property without a professional property management firm:

1. Buffer from Liability

While the U.S. may be one of the best markets for real estate investment right now it is almost one of the most litigious. The law can offer great protections, yet all too often makes owners of properties juicy targets for frivolous and malicious lawsuits. Having a third party buffer can offer an incredible shield to deflect and discourage these situations.

2. Bookkeeping

There are few individuals that really relish pouring over the books for hours. For investors attempting self-management this can lead to many expensive mistakes and missing out on a lot of income or tax breaks. Let a pro do it, and ensure it is handle right. The last thing you want is the IRS camping out in your living room for a month trying to make sense of your books.

3. Reducing Financial Risk in Marketing

One of the most important elements in maximizing income property investments is marketing. Unless you are coming in an already experienced veteran marketing pro this brings a lot of risk of waste. Tens of thousands can be burned quickly if simply shooting from the hip. A good full service management company normally already has a book of tenants and knows the market well so that they can maximize rental income with the right positioning.

4. Superior Tenant Screening

Bad tenants have become far smarter these days and it takes superior screening tools and strategies to weed them out and cut plans to take advantage of landlords short.

5. The Law

Unfortunately ignorance is not an excuse for breaking the law, and with regulations and rules constantly influx property management can be a legal minefield for those not on top of changes 24/7.

6. Time

Perhaps the biggest risk of all for those getting into real estate for passive income and wealth building is that it becoming another job. Being a landlord can be far more than a full time job. In fact, it takes a whole team. Let someone else deal with the stress, while you relax and enjoy the rewards.

Massachusetts Retail Property Investors Find End Of Year Boost

Massachusetts Retail Property Investors

Things are looking up for Massachusetts retail property investors, but total returns still depend a lot on property management.

Between healthy retail sales, demand for space, investment capital and new opportunities 2013 promises to finish on a bright note for commercial real estate investors in the Massachusetts retail sector regardless of the weather.

It’s no secret that the masses have been holding tightly onto their cash for several years. With the clouds of uncertainty cleared and individuals tired of playing it too safe while suffering poor returns there is expected to be some serious currency exchanging hands over the next few weeks.

Analysts in November report by Venture Beat forecast a $5 billion sales weekend for Black Friday through Cyber Monday. This will provide a nice boost to retail sales for the quarter and is expected to set a new record. For those commercial real estate investors with bumps in their leases for sales volume and tenant performance this can be a great thing.

At the same time investors can still find their own holiday sales bargains in the property market. Recent years of stress and rebound have led to great disparity with some commercial properties booming, while taking away tenants and traffic from others. Those are now ripe for rebirth and reinvention.

Retail property investors are also finding much of the capital out there is hungry to be invested. Between crowdfunding, partnerships, year-end bonuses and the rush to put money into self-directed IRAs cash is bountiful. Financing from commercial lenders continues to flow too with rates still attractive and new hybrid loan types emerging, and competition to push money out there door heating up.

Still, while it may all appear like easy going for now experienced commercial investors know all too well that property management is going to make all the difference. It can be seen in who is up and down now, will continue to separate who will win the best leases over the next year, and who will see the best returns over next 3-10 years.

So screen and select a local, full service property management firm with a solid track record of performing properties.

Making a Profitable Jump from Leasing Single to Multi-Family Rentals

Profitable Jump Multi-Family Rentals

The trend in hopping out of the residential game and into commercial real estate investment is picking up steam fast. So what does it take to make the leap and what do you need to know to really make it work and worthwhile for you and your portfolio?

More and more real estate investors from individuals to the world’s largest private equity funds seem to be increasingly exiting the single family foreclosure or REO to rental game and are moving into leasing multifamily apartments and other forms of commercial real estate investing. It makes perfect sense as the residential foreclosure crisis seems to be winding up and the commercial market seems to offer more opportunities and a better long term outlook for buy and hold investors.

However, there can be a huge difference between these two worlds of real estate and it pays to recognize where they are dissimilar. From financing to types of tenants, expenses and which factors matter most for future value be ready for a new way to do business, but a potentially far more profitable one if you know how the system works.

So what do you need to know and do to make the most profitable transition into leasing multifamily?

1. Financing

Commercial real estate isn’t just rising in favor because commercial mortgage underwriters are loosening up faster than residential ones, but it is a major factor. Also consider the wider variety of loan types at your disposal from blanket mortgages and bridge loans to leverage existing equity in other properties to mini-perm loans for positioning and of course non-recourse loans for maximum protection. However, you also need to recognize what criteria commercial mortgage lenders place the most importance on compared to those busy denying home loans today. Look at the ability to better structure deals, management strength and the difference a great executive summary can make.

2. Property Management

When it comes to leasing multifamily properties you aren’t going to want to take on property management yourself, at least not if you plan to invest in any sizable way. Beyond the headaches and time constraints it is just much wiser and more profitable to pass on the extra property management expenses including staffing, health care, liabilities and more to a professional third party firm to maintain the highest possible returns.

3. Future Value

Remember that when it comes to valuing multifamily properties it is really all about yield and the income approach. Not only does this mean extremely diligent bookkeeping, but low interest rates too. So can you lock in low long term rates on an assumable loan someone else can take over later? Plus recognize the advantage of being able to increase real value and income at virtually any time by making improvements.

Intelligent Massachusetts Property Management: Avoiding the Infection Bred By a New Boom

Intelligent Massachusetts Property Management:

The Massachusetts real estate market is taking off, but the spreading of the recovery is also carrying a virus infecting local Realtors and landlords…

Across the state demand for buying and leasing real estate from multifamily to single homes, retail stores and office space is heating up but the side effects may not all be pleasant.

Multiple offer situations are increasingly resulting in bitter bidding wars pitting prospective buyers and tenants against each other. In fact, while industry players have heralded a dozen or several dozen offers on a good percentage of property listings as a sign of rebound in places like Southern California and South Florida, Massachusetts apparently set a new record recently. MA real estate brokers stopped accepting bids after receiving 250 of them for a pair of local condos, which ended up selling for $400,000 above asking price.
Unfortunately this has turned some landlords and Realtors into monsters, with at least one proclaiming to the press “I ask for blood” when deciding which offers to accept. And we wonder why the industry has such a bad reputation!

Some may get away with this bloodsucking stance for a little while, and even find it lines their pockets with a little silver in the short term. Yet, there is also definitely something to be said for those that choose to inoculate themselves against this egotistical and predatory short term thinking.

It pays to play nice…

Sales people, sellers and real estate investors should absolutely capitalize on current market conditions and they should expect their representatives from full service property management companies to Realtors and attorneys to assist in maximizing their profit potential.

However, besides just being the right thing to do, showing a little decency, compassion and care can go a long way. In fact, it doesn’t just make you feel a lot better about what you do and how you make your money or boost your reputation, it has real, tangible financial benefits too.

If you want to play dirty hardball and act the bully anticipate buyers, vendors and tenants to be equally abrasive. As the owner of commercial properties in MA, whether you are leasing multifamily property, office buildings or retail space you are in a service business. You aren’t punting vacuum cleaners door-to-door, pushing used cars or even flipping dirt cheap single family homes. So winning and realizing the maximum returns and enjoying the most rewards in the long term requires a slightly different approach.

Look at how T-Mobile has scooped the mobile phone industry recently by serving up more of what customers want and treating them better than the competition. Contrast that with the dramatic fall of Apple on setting aside their focus on the customer for quick profits and milking everything they could out of existing clients.

Aside from building loyalty, enabling landlords to demand a well-earned premium and gaining referrals, playing nice also reduces liability. If you are a little more likeable the risk of malicious and frivolous lawsuits can be slashed and tenants are instinctively convicted to keep up their properties and go the extra mile for their landlords on their own.

Of course being nice or even just patient isn’t always easy as a landlord. It can be incredibly trying. That’s why having the right property manager in place can be invaluable.

Out of Town: Investors Confident but More Selective

May Property Management

Entering a new quarter the media has been flush with fresh economic reports. So how does it all stack for American investors and where are the savviest looking at for the best returns going forward?

All the data absolutely adds more fuel to the current trend in real estate investors looking outwards to secondary markets like Worcester, Massachusetts where the multifamily market has been rebounding quickly.

A new 2013 Investor Sentiment Survey shows confidence hitting a new record high fueled by strengthening fundamentals and low rates. So far the index has proven to be a “very accurate foreteller of economic direction” according to the director of one of the nation’s leading commercial real estate firms. Of those surveyed multifamily housing remained the most popular sector for investment.

This seconds the CCIM Institute’s First Quarter National Market Trends Report for the commercial real estate industry which in coordination with the National Association of Realtors reveals a rapidly improving market with high double digit gains.

Acquisition and leasing of multifamily apartments continued to attract the most investment according to the report with more rent growth and rising values predicted ahead.

These trends are expected to be compounded by a lack of housing inventory, which could contract even further as home builders reign in new projects. While Bloomberg News reports new construction surged more than analysts predicted in March 2013, it was multifamily that carried the numbers; hitting the highest level in over 7 years. Up 31%, multifamily is banking on robust growth as builder confidence drops on rising material and labor costs for single families and restrictive mortgage lending.

According to commercial real estate data compiler LoopNet Worcester’s multifamily property market has seen a sharp turn around since the middle of 2012. In fact, it was a year ago that asking prices for this sector really turned around for Worcester on a state, county and metro level. Real sales prices followed through, catching on in the second quarter, while time on market has continued to fall.

Right now there are great commercial real estate investment opportunities in areas like Worcester, MA and if you are backed by an excellent, local full service property management company there is nothing keeping any investor anywhere in the U.S. from enjoying the rewards to be had.

For those expecting a tax refund or wanting to minimize taxes next year contributing to a self-directed IRA and investing in multifamily in Boston’s secondary markets like Worcester could be a very savvy move for increased yields and long term wealth building while giving up less to Uncle Sam.

7 Holiday Gift Ideas for Worcester, MA Real Estate Investors


It’s that time of year again. The big hunt is on for great gifts for family, business partners, clients and vendors. So what gifts are hot this holiday season?

Whether you are shopping for others or looking for ideas to put on your wish list and regardless of whether you are building a portfolio of single family rentals, own a multifamily apartment building or two, or are engaging in the Worcester, Mass. commercial real estate market by getting in on the lift in the retail property sector, here are a few luxurious, unique and free gifts to consider…

1. Tech Gadgets

The battle of the big tech brands is already on, long before Black Friday was in sight. For 2013 the hot spot clearly appears to be tablets again. The iPad Air might be a complete fail, but it’s shaping up to be a hot competition between Amazon’s Kindle Fire HDX and the Galaxy Tab 3 from Samsung.

2. Food

From now through New Year’s Eve it’s all about food. From turkey to eggnog to pumpkin pie and office happy hours to close knit family dinners. All of these eating opportunities are great moments to give the gift of picking up the tab and building stronger relationships, which real estate is all about.

3. Caffeine

Caffeine keeps the real estate industry moving. Keeping up in busy markets like Greater Boston, especially in a hot market like is being experienced right now can require more than a cup of Joe on the way out the door in the morning or even a sugary Frappuccino in the afternoon. For real coffee fans consider the Handpresso which serves up espresso shots on the go in your car, or the cold, bottled Black Blood of the Earth which is 40x stronger than regular coffee.

4. Vacation

Perhaps it’s time to give yourself the gift of a vacation to relax and recharge before the New Year. Maybe an unplugged vacation away is the only way you are really going to commit to that much needed quality time with someone special. Or perhaps the budget is tighter than you’d like and giving your staff extra time off is the best way to make up for not having much to give as a year-end bonus.

5. Property

What more fitting gift to give for real estate investors than property. From cozy getaway cottages to condos on the beach and from lots to hold for generations to income investment property to provide ongoing income for parents or kids the opportunities are endless.

6. Extra Time to Pay for Tenants

Real estate investors may also be feeling the financial pressure of outrageous holiday shopping sprees and big credit card bills during this season but counting on tenants to pay on time between now and January is a fantasy. Much can be done to shake them down but perhaps the best gift this year is giving tenants some breathing room.

7. Referrals

The greatest compliment in this business is giving referrals. They can be far more generous than another gadget that won’t get used, and receiving them so much more valuable too.

Foreclosures loom as small firms face balloon payments on mortgages – WSJ.com


Many small firms that own commercial property are facing big trouble.

The problem is simple: Banks typically re-evaluate commercial mortgages every five to 10 years. At that point, they can renew the loans, or ask business owners to pay them off.

These days, lenders are a lot less willing to extend loans that don’t seem like good bets—and it’s tough for businesses to look creditworthy after years of slumped sales and exhausted savings. “So many small businesses have lost their reserves during the recession,” says Brent Case , president of Coldwell Banker Commercial Atlantic International Inc., in Charleston, S.C. “They don’t have that chunk of cash that banks want as a buffer.”

That leaves many small-business owners scrambling to find a lender that will cover their loan—or facing the loss of their property through foreclosure.

Trouble in Store

For an idea of the scope the problem, consider this: Some $276.2 billion of nonresidential commercial-property loans are expected to come due in 2013. That’s higher than any prior year, according to Trepp LLC, a commercial-mortgage research firm in New York.

Full service property management, Investment property, Real estate, Retail investment, Worcester county, Massachusetts Condominium Act, Property management, Worcester County Massachussets, Property management services, Property manager, Commercial Real Estate, Condominium Associations, Home Owner Associations, Investment Real Estate, Market News & Information, Multi Family Real Estate, May Property Management, Residential Homes, Homes for Rent, Homes for Sale, Central Massachusetts

A commercial property for rent in Stockton, Calif., a city that has been plagued by foreclosures Associated Press

Many of these loans were made leading up to the financial collapse in 2008, when property values were high and business owners could depend on steady income to repay the loan. In other cases, the loans came due in the depths of the financial crisis, but banks were willing to give businesses extensions—essentially pushing the question of refinancing to a later date. Some analysts estimate as many as 60% of commercial real-estate loans that came due were extended during this period.

Now the extension periods have been coming to an end. Borrowers are again confronting big balloon payments they can’t make—and banks are more willing to foreclose. They’re better capitalized than they’ve been in years and “are in a position to take a hit” on a loan, says Dan Fasulo , managing director of Real Capital Analytics Inc., a commercial real-estate research firm in New York.

Bud Matthews of Chapel Hill, N.C., faced a five-year balloon payment of $240,000 in 2006 and had no trouble refinancing with SunTrust Banks Inc. STI +0.48% But when the second balloon payment came due in June 2011, he couldn’t find a bank to refinance the roughly $200,000 still outstanding. “We went to other banks, and they’d say, ‘You are a good bet, but not good enough,’ ” says the 61-year-old, who occupies a commercial office for his 15-person construction and appliance-repair firm.

Full service property management, Investment property, Real estate, Retail investment, Worcester county, Massachusetts Condominium Act, Property management, Worcester County Massachussets, Property management services, Property manager, Commercial Real Estate, Condominium Associations, Home Owner Associations, Investment Real Estate, Market News & Information, Multi Family Real Estate, May Property Management, Residential Homes, Homes for Rent, Homes for Sale, Central Massachusetts

After much negotiating, the bank extended the loan through August 2012, but when it came due, Mr. Matthews couldn’t pay the outstanding amount in full. The bank didn’t want to refinance and started the foreclosure process.

Days before Mr. Matthews’s property was scheduled to be auctioned in February, Harrington Bank, a local lender, agreed to assume the loan.

Hugh Suhr , vice president of corporate communications for SunTrust, says, “While we are not at liberty to discuss specific client relationships, we make every effort to work with clients on a case-by-case basis…in order to reach an outcome that best addresses the needs of all involved parties.”

Given the number of loans coming due this year, and banks taking a critical eye to loan applications, it seems the problems will drag out for a number of years. As of mid-2012, about one in three loans coming due through 2016 was under water, meaning the property is worth less than what’s owed, according to one estimate from Trepp.

“We can look out three to four years and know with certainty that a super amount of debt will come due that can’t be dealt with in an ordinary way,” says Phil Jemmett, chief executive at Breakwater Equity Partners, a San Diego consultancy and investment firm that specializes in troubled commercial real estate. “Roughly 20,000 small commercial properties…are facing distress in the next 12 months. We expect similar numbers in the next three years, and then it will taper off after 2016.”

The incoming debt could trigger a “wave of foreclosures,” says Tom Watson, CEO of JPB Commercial Real Estate Advisors LLC, a brokerage and real-estate consulting firm in Miramar Beach, Fla. The size of that wave, he says, will depend on whether the economy continues to improve. If it does, banks will steadily agree to refinance loans and offset the number of foreclosures that would have otherwise transpired.

Continue reading at www.onlinewsj.com.