How to Make Money in Commercial Real Estate: For the Small Investor

How to Make Money in Commercial Real Estate: For the Small Investor

by Nicholas Masters

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Overview

How to Make Money in Commercial Real Estate: For the Small Investor by Nicholas Masters

An updated edition of the most reliable guide to commercial real estate for small investors

Commercial real estate investing is easier and cheaper to get into than you probably think it is. But if you're a novice investor or an investor who wants to make the switch from residential to commercial properties, how do you know where to begin? This Second Edition of How to Make Money in Commercial Real Estate shows you how to make the move to commercial real estate and wring the most profit from your investments. Successful investor and former accounting professor Nicholas Masters explains all the math and gives you all the expert guidance you need to successfully invest in commercial properties.

You'll learn how to:

• Prepare yourself before you start investing

• Evaluate different types of real estate and undeveloped land

• Read economic cycles and indicators so you know when to invest

• Calculate the long-term potential profits from properties

• Understand tax issues that impact your profits

• Form an investment club to share the risks and costs of getting started

• Find and evaluate individual properties with great potential

• Negotiate, finance, and close your deals

• Manage your properties yourself or through a management company

Product Details

ISBN-13: 9780471752615
Publisher: Wiley
Publication date: 04/14/2006
Edition description: REV
Pages: 304
Product dimensions: 6.22(w) x 9.19(h) x 1.09(d)

About the Author

NICHOLAS MASTERS, MBA, CPA, is a licensed real estate broker and has been a real estate investor for more than thirty years. He is also a former assistant professor of accounting.

Table of Contents

Preface.

Acknowledgments.

PART I: PREPARING TO INVEST IN REAL ESTATE.

Chapter 1: Introduction.

How This Book Is Organized.

Before You Begin.

Career Preparation.

Insurance.

Pension Planning.

Home Ownership.

Savings.

Conclusion.

Chapter 2: Comparing Real Estate to Other Investments.

Cash.

Savings Accounts.

Debt Instruments.

Bonds and Notes.

Stocks.

Collectibles.

Precious Metals.

Mining Stocks.

Real Estate.

Leverage.

The Miracle of Compound Interest.

Real Estate Investment Trusts.

Conclusion.

Chapter 3: Evaluating Types of Real Estate.

Personal Homes and Other Small Residences.

Starter Homes.

Small Apartment Complexes.

Other Residential Properties.

Garden Apartment Complexes.

High-Rise Buildings.

Land.

Types of Land.

Net Leases.

Rate of Return.

Build-to-Suit.

Shopping Centers.

Anchored Shopping Centers.

Strip Centers.

Condominium Stores.

Office Buildings.

Warehouses and Public Storage Facilities.

Conclusion.

Chapter 4: Understanding Economic Cycles and Their Effect on Real Estate.

Economic Cycles and Real Estate.

Speculation.

Who Is a Speculator?

Economic Cycles and Lenders.

Types of Lenders.

How Lenders Profit.

Conclusion.

Chapter 5: Calculating the Long-Term Potential Profits from Real Estate.

Real Estate Profit Sources.

Positive Cash Flow.

Appreciation.

Leverage.

Conclusion.

PART II: INVESTING IN REAL ESTATE.

Chapter 6: Getting Started as a Small Investor in Commercial Real Estate.

Safety in Numbers.

Forming an Investment Club.

General Guidelines for Starting an Investment Club.

Forms of Ownership.

Individual or Joint Ownership.

Joint Ventures.

Partnerships.

Corporations.

Limited Liability Companies.

Conclusion.

Chapter 7: Finding and Evaluating Properties for Investment.

Finding Properties.

Real Estate Brokers.

Periodical Advertisements.

Word of Mouth.

Foreclosures.

Government Surplus.

Auctions.

Private Sales.

Sale Leasebacks.

Real Estate Source Roundup.

Evaluating Properties.

Self-Evaluate or Hire an Appraiser: That Is the Question.

New or Used: That Is Another Question.

Evaluation Approaches.

Conclusion.

Chapter 8: Negotiating, Financing, and Closing Real Estate Transactions.

Negotiating.

Using Brokers or Other Intermediaries.

Negotiating Leases.

Contracts of Sale.

Summary of the Negotiation Process.

Financing Commercial Real Estate.

Determining Interest Rates.

How Mortgages Work.

Types of Mortgages.

Sources of Mortgages.

The Closing.

Documentation.

At the Closing.

Conclusion.

Chapter 9: Managing Your Real Estate Investment.

Professional Management Companies.

Finding a Management Company.

Management Fees and Operations.

Monthly Reports.

Rent Collections and Billing.

Leasing.

Insurance.

Repairs, Replacements, and Capital Improvements.

Marketing Space.

Preparing for a New Tenant.

Leases.

Lease Designations.

Addendum Clauses.

Lease Summary.

On Your Own: Your Future in Real Estate.

Appendix A: Additional Deals.

Appendix B: Understanding Taxes and Real Estate.

Appendix C: Common Real Estate-Related Forms and Documents.

GLOSSARY.

INDEX.

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