I'm gonna try to buy a warehouse for my Business this year.-- any advise/warnings?

[Papa John]

I need more space for area rug cleaning and it be nice to be able to perform Maintenance on my TMounts indoors.

1st time buying commercial real estate-- guess Ill need an SBA loan?

I thought about leasing space-- but seemed like big headache and many landlords have too many conditions.

Question is: Is it less painful to "Bend Over" for a landlord or bank?

any pointers or warnings from those that have done it would be appreciated.

 

[GCCLee]

Sweet!

This is an exciting topic for sure.

Congrats Papa J : )


Walk us through the process buddy.


Sent from da parking garage of dee detention center

 

[Shane Deubell]

Guess it depends on the landlord, we have had same one for 7 years now.
He is pretty much invisible and has never raised rent.

Only warning i would have is to use an inspector with a commercial background. Replacing a commercial roof is stupid expensive.
Think about the long term capital projects you will have to take on.

 

[Papa John]

Thanks GCCLee and Shane. almost forgot about the roof issue. Im sure the bank would require an inspection though.

I think San Francisco is just insane area to do a lot of things. I took an SBA class on Commercial RE Leasing and I learned a lot. But left class thinking Leasing sucks.-- some rents seem barely affordable-- $2/ sq ft per Month--- then you find out its Triple Net rent--- Which If I understood the term, correctly-- means that rent is pure profit for the landlord and you pay ALL his expenses for that property-- including the loan payment and taxes and maintenance!!

As for the purchasing/ Investing option: This is what I've learned so far--- Warning-- This is how I understand the process as of now on a subject I am only starting to learn-- so I might be wrong.. This is why I came to MB to pick some brains for advise.
If you have 20% then its easy to get a loan--- BUT-- WARNING!!-- as I understand it--- IF the bank THINKS you might be headed for financial crisis-- they can foreclose on you-- EVEN if your payments have been on time!!

With an SBA banked loan you will generally need a 10% down -- but They may tack on a 3% fee-- which they can add to the loan-- so that means you are really putting 13% down + interest on that 3%. In some instances the SBA will back a loan with less then 10% down.. I think they recently ended a 100% loan program.

I want to buy a warehouse because we could use more space-- BUT also the tax advantages would also be a nice help... Robert Mann told me something very interesting when I was taking a class at his very impressive operation-- he said' "I decided to stop working for a paycheck and build my wealth instead.

Our USA tax code is great as long as you keep growing and investing in growing and expanding your business--- but when you stop and decide to take more money for yourself-- the tax man takes 60%+. 35% fed, about 17% SSI, 10% state.

I leave for the states in few hours-- so generally I don't have too much time for MB when I'm in the states-- life is hectic running the business and dealing with drama-- but I LOVE IT-- I'll check back to see if anyone left any advise and to keep you guys updated on the process.

I'm in Thailand now, where I have my vacation/retirement home. btw-- the Thailand 'Coup" was more like a peace keeping effort. Before the "coup"-- SOME of the "Democrats" (red shirts) and the "Republicans" (yellow shirts) were basically having a Gang fight in Bangkok. The General warned both sides that if the violence continued he would have to step in. 1 day before the "coup" the "Republicans" had tossed a hand grenade into the "Democrats" --killing some people.

The General has rounded up the leaders on both sides-- put them in a room- and he told them to THINK & Talk out their differences. The General's actions has prevented a Civil War-- GOD BLESS HIM. and may God continue to guild him to be compassionate-- Blessed are the Peace Makers, for THEY are the true children of GOD.
If you are an atheist-- just substitute the word "God" with the word "LOVE".

 

[GCCLee]

You Have GOT to post more here!


Wow, you got stories we can learn from : )


Thanks and B safe out there !


Sent from da parking garage of dee detention center

 

[Shane Deubell]

I want to buy a warehouse because we could use more space-- BUT also the tax advantages would also be a nice help... Robert Mann told me something very interesting when I was taking a class at his very impressive operation-- he said' "I decided to stop working for a paycheck and build my wealth instead.


I'm in Thailand now, where I have my vacation/retirement home. btw-- the Thailand 'Coup" was more like a peace keeping effort. Before the "coup"-- SOME of the "Democrats" (red shirts) and the "Republicans" (yellow shirts) were basically having a Gang fight in Bangkok. The General warned both sides that if the violence continued he would have to step in. 1 day before the "coup" the "Republicans" had tossed a hand grenade into the "Democrats" --killing some people.

The General has rounded up the leaders on both sides-- put them in a room- and he told them to THINK & Talk out their differences. The General's actions has prevented a Civil War-- GOD BLESS HIM. and may God continue to guild him to be compassionate-- Blessed are the Peace Makers, for THEY are the true children of GOD.
If you are an atheist-- just substitute the word "God" with the word "LOVE".

NOW that is some good advice! Unfortunately building up net worth is boring and you can't really show it off same way as a new car or boat.
Takes a lot of patience but well worth it over the long term.

Man, i would be $hitting bricks over in thailand right now!
Seems like they have had constant political unrest for the last 10 years or so. Didn't the prime minister get chased into exile several years ago too?
Can't remember the details but i usually do follow this stuff casually.

 

[Mikey P]

So Papa, was it the freely available young women or the cock fighting that lured you over?

 

[Carpet Cleaning Fool]

Go for it!

 

[Papa John]

Too many people to quote here-- cus I not sure how to respond using the "reply w quote" feature correctly-- So I will respond to the easiest to -- the more in depth response.

GCCLee-- thank you for your kind words-- That is why I'm changed my MB name to Papa John-To show that I'm here to help people- Some of you may know me as VegiJohn-- but people thought I was a Vegetarian. n the name didn't "fit ME"-- it WAS VegiJohn cuz I was 1st one to run my vortex on recycled vegetable oil when diesel was almost $5/gallon. I generally don't have much time for MB when I'm in the states-- a lot of "drama" running a biz in SF--- but I will try check in from time to time or when I have been quoted or PMed. I generally only have time to "play" with you guys when I'm in Thailand. My next trip will be end of July to August sometime.

Mickey P --My 1st trip to Thailand was because my Chinese GF had More freedom to visit her mother, from China, in Thailand then to visit her in USA or China.-- Odd-- The GF's mother got approved for her visa to Thailand BEFORE my then Chinese GF got approved to go from USA to Thailand-- yet we Americans think we are free.

My second trip some 5-6 years ago was-- YES, for the infamous good times with young girls-- haha--- but after 2 such trips I was bored and ended up falling in love with a very nice girl from a good family.-- I really liked the Freedom of business ownership and Life style that I enjoy in Thailand--- With regarded to business ownership-- there is more freedom in Thailand then in USA--- but because Thailand Lacks all that is bad in USA-- mainly GREED--- you wont be able to make Big $$$ when compared to USA standards-- BUT u can live very well with less stress.
I could retire now in Thailand because my businesses are able to give me a comfortable life style--- and That's at only profiting $100 -$200 a day-- which is VERY good money in Thailand- The Typical worker in Thailand only make $8/day.
My Thailand Wife just turned 28 and I'm about to turn 51---- I'm like Hugh Hefner on a budget-- haha

I go to Thailand every 2-3 months-- If any of you would like hand holding in Thailand just ask--- Maybe call it:...... wait for it..... Papa John's Fest-- X- rated version... haha. maybe have some biz classes so it can be tax deductible-- haha

Shane---- It WAS more dangerous in Bangkok BEFORE the coup then After--
However because of the curfew of 10pm-- you will need to "get your groove on" a lot earlier in the day-- haha...Usually.... 10pm in Bangkok is just when the "Going Gets GOOD!" haha

This General of the Coup may have stopped a Civil War in Thailand--- The General has placed all leaders of both feuding parties in a room and told them to-- THINK, and Talk about how to resolve their differences.. The coup has been bloodless and restored Peace to BKK= Bangkok. Before the coup it was starting to become a GANG Fight between the "Democrats" and the "Republicans"--- INPORTANT INFO--- In Thailand- the Yellow shirts call them selves the Democrates--- But they behave and believe more like the USA Republicans. The Red Shirts- call them selves the Pheu Thai party which behave more like the USA Democrats.

What is Odd is that the BOTH sides have more in common now-- because the red shirts have discovered that they were "Lied" to by the leaders of the Red shirts in order to get elected-- The red shirt politicians made promises that they Could not delver on.-
So the poor people who vote for the red shirts want change,-The Yellow want change because they claim that the red shirt politicians are corrupt.

BTW-- Going to Las Vegas to party is like going to a Baby Shower-- when compared to Thailand... and Thailand is "cheaper"...

 

[topnotchcarpetcleaning]

Make sure the warehouse is zone for what you want to do. Also Rules change. Our local Fire Marshall has closed down businesses because they say building is unsafe. If customers comes into your place it may also need to be "earthquake proof" plus alot of other things.

 

[TomKing]

couple questions

Why take on all the capital expenses?

Can you buy cheaper than you can rent?

Do you have 3-6 months saved for the move?

How much will the transition cost? I moved 3 years ago cost $10k to refit the building for our use.

Can you buy more than you need for future growth?

Can you easily rent the unused space for a few years?

How much market share for rugs can you gain?

What is your in print marketing plan to launch 3-6 months prior to the move to cover additional overhead?

Can you sustain additional marketing and overhead dollars?

Just questions I would be asking