Sequim Commercial Property, Port Angeles Commercial Property

Your Business Is Your Financial Security

Buying or selling a commercial property?  Who will you trust to handle your most important transaction—the purchase or sale of your business?

Chuck practiced real estate law for almost 20 years, handling many commercial transactions, and recently returned from practicing commercial sales in Pierce County where his last transaction was $7.8 million, which after one year in feasibility studies did not close.  Ouch!

Here's the situation in Sequim and Port Angeles:  there is not enough commercial business for a commercial agent to devote 100% of his time to commercial and industrial.  In King, Pierce, Thurston, and many of the larger counties in the state, you will find Commercial Brokers, and that is all they do.  Not so in Clallam County.  Not enough business.  Maybe if an agent had 100% of the business, he could make a living, but that will never happen.  It is not unusual for a local business owner to list his commercial property with his licensed sister-in-law who has two year's experience selling single family homes. 

Chuck's Professional expertise includes:

1. Vacant Commercial Property
2. Commercial Buildings
3. Business Opportunities (unique issues for each one)
   
4. Farms (ask me about legally eliminating capital gains tax)
   
5. Property Development (very complex area of real estate)
   
6. Industrial Property
7. Real Estate Partnerships (many traps for the unwary here)
   
8. Real Estate Joint Ventures (critical issues must be addressed)
   
9. Real Estate Entities (asset protection and tax issues here)
   
10. R.E. Asset Protection Strategies (elite strategies)
    

You Get Tremendous Exposure

My strategy for marketing commercial properties is very effective, and I do not share it publicly where other agents can learn what has taken me a lifetime to learn.  I have a business model and tools that no other agents are using, much less aware of.

Call today for a free consultation with Chuck to discuss your options, value, tax considerations, and much more.  Let’s talk, because . . .

         It’s Your Business & Your Money.

Chuck Marunde, J.D. Broker/Owner Sequim & Port Angeles Real Estate 618 Peabody St., Suite I Port Angeles, Washington  98362 360.775.5424 email:  chuckmarunde@gmail.com

Key Commercial Terminology

What investors buy (and what lenders finance) is the property’s future income stream.

Cash is king. It determines the value of the property, whether the investment is a success, and whether the lender gets paid. Location, property condition and all of the factors you think about as being important to residential property still matter, but with investment property they matter insofar as they enhance or detract from the property’s expected future stream of income.

Here are some key terms that are important both from the investor's perspective and the lenders:

Net Operating Income (NOI) – The property’s potential gross income, less losses due to vacancy and collection, less all operating expenses such as property taxes and insurance (but not mortgage interest or depreciation). NOI is probably the single most important piece of information about an income property.

Annual Property Operating Data (known as the APOD form) – A form that shows income, vacancy loss, operating expenses and NOI. It’s like a P&L for an income property.

Capitalization Rate – A rate-of-return measure which, when used in conjunction with the NOI, will give you an estimate of the property’s value.

Debt Coverage Ratio (DCR) – The ratio between the property’s annual Net Operating Income and its annual debt service (i.e., mortgage payments). There’s that NOI yet again.

DCR is an essential part of the mortgage underwriting because the lender wants to know that you’ll have not just enough but more than enough cash to cover the mortgage payments. The minimum acceptable DCR varies among lenders and property types, but in general a property is unlikely to get financed with an expected DCR less than 1.20.