A Practical Guide to Investing in CRE CLO
Collateralized loan obligations (CLOs) are a short-term financing option within commercial real estate. These can be a valuable vehicle for both property owners and loan investors who have a time frame of 3 to 5 years.
What are CRE CLOs?
CRE CLO stands for commercial real estate collateralized loan obligation. These are investment vehicles composed of short-term commercial real estate loans.
The loans are pooled … Read More
Build to Suit Lease: What It Means in Real Estate Investing?
Property owners who have vacant or ready-to-update property may wish to offer a built-to-suit lease. This means the property owner agrees to lease arrangements in which the owner works with a developer to build a property based on the tenant’s needs. For investors considering a vacant property, a build-to-suit lease could be advantageous if a prospective value exists in the area for new business development.
What is FF&E and Why FF&E Matters in Real Estate?
Businesses may own many different types of property, with buildings, equipment, materials, and inventory being just a few examples. FF&E is one way of grouping assets that have value and last but aren’t part of a commercial real estate property.
What is FF&E?
Furniture, fixtures, and equipment (FF&E) refers to hard assets that last longer than one year but aren’t affixed to the building or … Read More
Percentage Lease: What It Is and How it Works in Commercial Real Estate?
There are several different ways to structure a commercial real estate lease. When leasing retail spaces, a percentage lease is one of the common options. The lease’s structure can have benefits for both the lessor and lessee.
What is Percentage Lease and How Does It Work?
A percentage lease is a commercial real estate lease wherein the tenant pays the landlord a portion of their … Read More
Understanding Real Estate Waterfall Model
The investment in commercial real estate always warrants careful consideration of a variety of factors. As one of the most confusing of all commercial real estate investment strategies, the equity waterfall model may be one of the most important methods to truly understand. There are numerous ways cash flow from a project can be split, and that is what makes this real estate waterfall method … Read More
What Does ARV Mean in Real Estate Investment?
One of the most important figures that real estate investors must know is After-Repair value (ARV). Determining whether multi-family housing or commercial real estate is worth rehabbing is essential.
What is ARV in Real Estate Investing?
After-repair value estimates a property’s value after all planned renovations and repairs are completed.
ARV helps real estate investors determine how much a property could be worth. From that, … Read More
How to Find Out Who Owns a Commercial Property
The best commercial real estate opportunities often aren’t listed. They require research to find, and a key component of the research is finding out who owns the property. Rarely is this easy to do, but several strategies can be used to figure out who you should contact about potentially purchasing a commercial property.
Understanding Commercial Property Ownership
Finding who owns a commercial property is more … Read More
Credit Tenant Lease (CTL) Financing in Commercial Real Estate
Every landlord who’s held commercial real estate knows the value of a good tenant and understands that good tenants deserve incentives. One way that landlords can incentivize well-qualified tenants is with a credit tenant lease.
What is a Credit Tenant?
A credit tenant is a tenant that has a high credit rating, as determined by one of the major rating agencies (e.g. Moody’s or Standard … Read More
MSA: Metropolitan Statistical Area in Commercial Real Estate
A Metropolitan Statistical Area, also known as an MSA, is an important factor for those considering investment in commercial property. Understanding what they are and what factors contribute to their creation can influence lending decisions and opportunities.
What Is a Metropolitan Statistical Area (MSA)?
A metropolitan statistical area is a government-designated area for a specific urban region. The U.S. Office of Management and Budget (OMB) … Read More
How to Calculate MIRR: MIRR Formula and Examples
Commercial real estate investors need as much information as possible when deciding what to invest in and how to do so. Numerous types of financial data are available to allow for that, including modified internal rate of return (MIRR). This specific metric enables investors to determine if a property is a good investment or one that carries too much risk. Therefore, understanding this metric is … Read More