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Here's a small article on the F500 company being "lured" into the area. My mistake, it's NOT a grant, it's an incentive. It is different: F500 Article
Freckle: We can agree to disagree again on certain topics. When you ask why these companies haven't previously entered the FL market and are looking now. Well, they were looking in the past. The market crashed and that changed things quite a bit. There were several corporate headquarters that gave up deposits on land once the market turned just to walk away. I believe their insiders have kept FL on the backburner for a time like now. I have fielded calls from Pharmeceutical companies that will be either HQ'ing or building satellite facilities in the Airport Commerce section of town. There is more chatter for business growth in FL then there is in NJ, AZ, NV, etc…
Regarding my 62% win percentage, that was arbitrary. I wouldn't be where I am today at 62% but I will say that I have lost people money before. But I'm also trusted by corporate executives to make decisions on when and where to buy. So let's give me a little bit better of a win percentage then 62%
. My strategy with my long term clients is that if there is a deal that is a loser, get out early and get into something more favorable. Take a step back before taking a leap forward. I've seen too many agents ignore their losing customers which drags out losses and more pain. This is glaring in the foreign national clientele. Imagine me telling half of this forum that I don't like the investment I just advised you to buy 8 months ago and that I think it's a good idea to sell at 15% loss and buy another asset to make up for it. I'd get laughed at and probably banned from this board!! The financial model I will post calculates Cap Rate sensitivity. The rule of thumb in new construction for instance is that if you can't stabilize your property upon completion and generate an 8% Cap Rate, it's too risky. Anything above 8% is a good deal that should grade out well. It's simple actually.
Lastly, I don't believe more then 10% of agents have good references for Property Mgmt. In my area there are 1,000,000 PM's, and I would probably only trust about 4 of them. I've done business with many companies and the 4 I have narrowed are companies I have worked with for years as has my firm. They are the third party companies that make me look good or bad so I have a huge incentive to refer only the best….at least the best in my opinion. PM's rape the profit from deals if you get hooked up with a bad one. Don't even get me started on them..
One of the reasons I like commercial deals in SW Florida is because the residential side of it is a frenzy and it will cap out. It will become cheaper to rent then buy again until that ceiling deflates a bit. That said, it's not a bubble. The factors aren't in play for another bubble. There's no sub prime… There are no bad mortgages… It just means that the cash investors (60% of buyers) will generate more income today and less in maybe 2 years before year 4 see's another increase…NOT A CRASH…a softening if you will.
Lastly…foreign nationals…if they want to buy something…most are ignoring multi-family. They shouldn't. If you are looking for $100,000 or less to invest, that's up to you. Good luck. The smart money is on commercial multi-family.
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeNow isn't this a constructive thread?? Ok Freckle, let's give each other the benefit of the doubt and assume we each make good representations of our investing ideas. I'm licensed in NJ and FL so anything I state is likely going to be partially biased toward those areas. That said, I'm also a devil's advocate. Candidly, I have a good business in each state. Getting an Oz investor on my team isn't something that's going to make or break my bank but certainly I'd value any opportunity to work with anyone. I've worked with a lot of Oz investors, some directly from this forum who have asked me to keep their info private ESPECIALLY on this forum
I love you guys and those I've met happen to be great drinking buddies!Truth of the matter is that investing is based on overall risk exposure. If you go back to a thread I began a year ago here, I stated that investors need to utilize "old school fundamentals" of investing and that is CASH FLOW. I've since opened my range to upside as well..a lot. Why? Well, I'm a little hungover this morning so don't have the desire to dig into charts and graphs that will likely get criticized anyway, but let's just say that I've got a pretty good track record with instinct and I'll live or die with my decisions and partially, so will my investors who hire me to do so for them or as a part of their team. My long time clients have made and lost money with me but my average is over 62% which means at the end of the day we are on the plus side
Wait, that's a sports gambling statistic….ah well, same for real estate! I am doing 2 major construction developments that grade out very well for U.S investors. For a foreign national, might be on the fringe of a good deal, but likely something they would pass on. I'm basing this off of the convos I have with foreigners who want 10%+ Cap Rates or ROI. There are a lot of folks who slam Detroit because it's the ghetto and that Cap Rates are inflated. Probably true, but if you invest in good areas with limited risk exposure, the market is just not trading at double digit returns and in my opinion, if you are promoting a Class A or B neighborhood and showing ROI above 10%, that is a red flag to me…Not impossible, just not common. Florida has pockets that are good right now for similar reasons. Tampa, Ft. Myers, Cape Coral, Naples along the Gulf Coast are doing well because of job growth, low prices, tax incentives etc… Freckle, you say that the "steep recovery" is limited to certain areas of FL. I agree with you. That said, in those pockets of improvement, the growth isn't synthetic… It is organic as you dispute. In fact, in Ft. Myers (if I can present just one example), there is a Fortune 500 company that is looking to bring in over 500 jobs with an average pay of $105,000 if they are granted a $4 million incentive for development. Do you consider grant money synthetic? I don't. These grants have always existed for corporations. Synthetic growth are deals like the "First Time Homebuyer Tax Credit"…."Cash For Clunkers", etc. I call them "crutches" which would also mean synthetic… This Fortune 500 firm is not moving to the "desert" as you say, but they are moving to an area where population is denser, opportunity for perhaps "cheaper employment" exists for something they plan on expanding on, and cheap land, creating lower overhead. This is very real and very organic.
I read a market study for supply and demand of rental units in this area. The study was done by one of HUD's most reputable third party firms. When I see corporate growth, combined with what I saw in the report, it makes the decision to invest a lot easier. Problem is that this information is confidential and investors on the inside get there first and the foreigners get there last AFTER the good investors already exit.
Point being…..get with the right broker that you can get a good inside with. If you want to come in and invest $50,000 that won't get you much but ignorance from great agents and forced product with bad agents. True story. You want to be a player in the U.S if you have limited capital? Get together with a forum like this for a cup of coffee somewhere. Create the idea of Joint Venture. Guess who is willing to finance for foreign JV's? Yep, certain U.S banks, but only on commercial loans… so as you won't be able to finance a single unit home, how about an 8 unit apartment building, maybe 6…anything over 4 units is considered commercial and factoring $65k to 90k per unit on cost for land and construction, take that into considerating. The time for small time units are OVER. The pendulum has swung. Commercial is where it's at. I sell 1-4 unit buildings in NJ. I laugh at what investors buy them at. It's over market value and a bad decision on their part….but I represent the sellers up there so makes no difference to me. Shows me investors are stupid and their agents only care about the $$$.
I don't force product on anyone. I develop ideas, I brainstorm with the best, and I ask for my customers feedback. All of this information to you OZ investors is a waste. EDUCATION WITHOUT APPLICATION NETS YOU ABSOLUTELY NOTHING!! I see a lot of people crying on this board with most bashing brokers and properties, yet are afraid to touch anything. Put your minds together and make a collective informative decision. That's good business.
For those interested, I am going to post a Discounted Cash Flow financial model. This is the best way to analyze investment in my opinion. If I post and people call me out as "pitching something", I have to say I already sold this
I'm just showing an example of how I've been trained to analyze investment and probably something you could use to make better decisions here or in Oz. Some of you may already know this model but I guarantee most don't. I promise it's more complex then what you see on a realtor website showing A + B = C. It takes everything into equation besides location. Have a great remainder of the weekend. Hope I was able to elaborate a little. If I missed addressing anything, let me know and I'll fight back
Frozen Drink by the pool time!CHEEVES
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeI could have been a millionaire!! Double edge sword because I am a die hard Yankee fan! But at least I had something to cheer for if the Yankees lost the series. Baltimore proved to be a tough team. I like them a lot. Yes, Giants got some luck.. Cardinals never die though so the NLCS will be a great series!
I love this time of year.. Real Estate is in full swing in Florida since the snowbirds come down to spend their money during the winter. In NJ, the assumption that sellers lower prices in cold months will have buyers out in droves….Yankees in the playoffs, Football is in full swing and New Jersey fall weather.
Life is good
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeHi SparkyOz…when are you going to e-mail or call me??
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone MeJay:
I'll say this with a grain of salt. I am originally from NJ and ended up in FL accidentally in 2002 full time after playing a stint in the minor leagues for the Red Sox (why you always hear me pitching about the new stadium
I went to school all my life including all 4.5 years of college in NJ and studied Finance with full intentions on being an M&A guy on Wall Street.. Once my baseball career was finished, I decided to follow a friends lead into the FL real estate arena. I had very little money at the time but purchased 3 vacant lots in Cape Coral. In 5 months, tripled my money and became sold that FL was the place for me to be since that was my first real taste of money. Ok, so I turned 8k into 22k. Nothing to retire on but in my young 20's, I bought my first bottle of good tequila!
I learned and climbed quickly in FL. Hired by a bank in 2005 to run their real estate division, a position I secured by blindly helping a developer affiliated with that bank get very difficult zoning and land entitlements on the Gulf of Mexico in Fort Myers. A bit of skill and luck went into that but it catapulted me to high ranking positions at a bank who was eventually seized by FDIC.
In 2005 while with the bank I became licensed in NJ. Launced http://www.NewJerseyRealEstateGuys.com in 2008 and it has quickly grown into a lead-generating animal. During my time in NJ, I loved it and begged the wife to relocate back. For one reason and this will hopefully answer your question:
Let me preface by saying that the FL qualifications for teachers is far less difficult then it is in NJ. I JUST LEARNED THIS as my child entered kindergarten. For years, I said to myself that business minded people are way more successful and competent up north then they are down south…For the most part at least and dealing with the people I have dealt with. Florida leads the country in Multi-Level-Marketing. Why? Desperation. What a garbage industry. You don't see that up north. Why? Because its a garbage industry and we just don't buy into that crap up there. Oh, and Florida also leads the nation in mortgage fraud, to boot. Why? Because mortgage fraud is easy and dummies take the short term gain with dealing with possible jail time later. Yes, happens everywhere but way more in FL. It's a proven stat.
That said, unlicensed activity practically is non-existent up in NJ. That is one of the reasons I favor the NJ economics and housing market moreso then anywhere else. It starts with individual intelligence. I'm sure there is unlicensed practices everywhere and I've read about them in NJ….But in area where education is less and intellect is less, your bottom feeders thrive into more unsophisticated arenas.
Jay: I hate unlicensed activity. The crappy part is, you deal with it in FL. In NJ, you either have a license or you don't bring anything to the table. To Floridians, this is a way of life. To those up north, it's a slap in the fact to all of the hard earned education and accolades we have earned as a result of our education.
Still love Florida for what it offers, but we just don't deal with that crap up north. This I know from tons of experience, not guess and bias.
CheevesFinancial | Cushman & Wakefield - Commercial Property SW FL
http://www.CommercialRealEstateVoice.com
Email Me | Phone Me
. My strategy with my long term clients is that if there is a deal that is a loser, get out early and get into something more favorable. Take a step back before taking a leap forward. I've seen too many agents ignore their losing customers which drags out losses and more pain. This is glaring in the foreign national clientele. Imagine me telling half of this forum that I don't like the investment I just advised you to buy 8 months ago and that I think it's a good idea to sell at 15% loss and buy another asset to make up for it. I'd get laughed at and probably banned from this board!! 
