Congratulations to Sam Tecca and Keith Keltner on the sale of 170 Eady Court in Elyria. This industrial space had a 2,000 SF building with 2 drive-in doors on .15 acre lot with fenced-in storage. Our team works to find the right space for each client.
Former Towne Auto Sales has sold to Jiffy Lube by Gerspacher Real Estate Group in cooperation with Keith Hamulak of CBRE. This corner, along with the 2 homes behind it, will be redeveloped into a new well-designed site.
The commercial real estate market continues to have pockets of strong demand in many areas we serve and I anticipate another strong year overall. We estimate 10%-15% of businesses are devastated, 20%-25% are on fire with growth and the balance of businesses are sustaining or holding steady compared to Pre-COVID times. I continue to see more industrial buildings coming on the market for sale and lease, office vacancy increasing because of COVID stay-at-home orders, and retail spaces adapting for different uses that are COVID resistant. We continue to see higher land demand because of record low interest rates. The lower interest rates help offset the ever increasing construction costs. Leased investment real estate continues to be very hot and cap rates remain very low with assets that have regional/national tenants with 7+ years of term remaining. Lastly, I continue to see the apartment market transferring at record prices. There are great opportunities if you are ready and prepared to invest.
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As we all work through these difficult times it has caused many clients, customers, and other business owners to get creative on how to create cash flow. There are many business owners that are not familiar with the leased real estate investment market. You may be surprised that there is an entire global market that chooses to diversify their money by putting money into real estate that is leased. The returns on those investments are paid by the tenants/businesses that occupy them when they pay rent. If you are experiencing a tight time of cash flow, you may want to consider selling your property to a third party investor and signing a long term lease.
These are just a few benefits of doing a lease back:
- You are able to pull all of the cash/equity out of your real estate to help support you in this difficult time.
- You relieve yourself of the stress the comes with managing the real estate and the debt that may hurt you even further.
- You can control the building with a lease agreement just as strongly as if you owned the property. Yes, lease agreements are binding, so even if you sell the property to another owner, your lease agreement when negotiated right gives you all the control you need. Common terms of leases could include an initial 10 year lease to maximize the sale price with an additional 3-5 year renewal terms allowing you to control your former building for the next 25 years.
If this sounds like a strategy you are interested in, consider giving me or one our experienced agents a call to discuss how we can help you.
View For Sale listings Gerspacher Real Estate has on the market.