KLE 106 – Anatomy of a Commercial RE Investment – Part II

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OK – close your eyes (actually, keep them open so you can keep reading!) and imagine the complexity of analyzing cashflows and proformas for a real-estate deal well north of $2.5 million (KLE105) …

Daunting, huh?

Well, that may be how OTHERS analyze a deal, but not me … all of my deals are done on the backs of envelopes … well, one clean sheet of paper. I have this one right in front of me, in my own scrawly handwriting.

On the strength of what I am about to show you, I have authorized my Realtor to make a written purchase offer to the owners with a $200k ‘earnest money’ down payment (deposit) on the $2.7 Mill. office/warehouse.

Sure, the detailed financial proformas will come later, but I’ll have my Realtor and accountant prepare those for the bank … while I’m at the beach or off skiing someplace!

Here’s what the piece of paper says:

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In the final part of this KLE, I will summarize this all for you and explain why I like the deal so much …

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