Flipping Commercial Real Estate

Flipping Commercial Real Estate

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Most people are familiar with residential flipping. A saturated market with anyone with some decorating
sense and some good contacts can make 20%-30% profit on a flip. Though not easy it’s a fun and exciting
way to get a good ROI on your life savings. But the very reason for its popularity and good returns are
also making it harder for newbies to get in on the action. Deals aren’t coming in as much especially now
that it’s everyone’s fair game and sellers are holding out for top dollars. To exasperate the problem most
contractors are too busy with large jobs. These are also the reason investors are turning their sights to
commercial property flips. It’s a phenomenon that been around for ages. A study recently done by Keyvon
showed approximately 60% of all commercial properties in the US bought during the crash were intended
for short term hold. That’s a staggering amount. So where is the good news in that? Well most of the
“flip” properties were purchased for over $10M, which is another staggering amount. So what about the
$1M-$10M properties? That’s where new investors armed with a little know how about investing, CAP
rates, current market rates, and property income levels are taking advantage of quick high return flips. Not
yet saturated but challenged by skinny inventory, investors are buying properties that are vacant or not,
and apply their knowledge. They also use some of the same philosophies as their residential counter parts;
a little curb appeal goes a long away to attract good tenants and boost desirability.
Not yet in the know about commercial real estate? Get commercial property values, rent estimates, and
property ratings go to: Keyvon.com
Here are some after pictures of an office condo flip in downtown San Diego