Wrapping Up The Week

Another typical day in the office today. I am set to close an escrow a week from today and have been coordinating all of the last minute details between the buyer, seller and escrow to make sure that we close on time. Even the easy ones are never really easy, something always seems to pop up. But as my old boss Rick John used to say, "if it was easy everyone would do it." In this case everyone is cooperating and everything should work out fine. I'll post details of the deal once it is closed.

I also met with a new client this morning and showed him a very nice 10,000 square foot building that is for lease at only $.35 per square foot. He was pretty excited considering his current landlord has him paying $.60 per square foot for 5,000 square feet. He now has an opportunity to double the amount of space he has at almost the same monthly rent. How sweet is that?

Just to make things interesting, as I was sitting here typing I  got a call from a guy who wants to put a marijuana co-op in one of the multi-tenant properties that I do the leasing for. Most property owners will avoid these guys like the plague, and my owners probably will too. I'll call them and ask but most owners just don't want their properties associated with that use. The legality of them is still questionable, even though this guy insists that he is totally legit. What do you think? If anything comes of it I will let you know.

Have a great weekend!

The Lead Generation Business

It doesn't matter what kind of business you are in. If you sell a product or service you are always looking for the next customer or client. While I would consider myself an expert in selling and leasing industrial real estate, I am also an expert in generating leads. Really, when I think about it, at least 50% of my time is spent doing one form of prospecting or another. Some of the methods I use to generate new leads include:
E-mails. I have spent the last several years putting together a huge database of e-mail addresses. I like e-mails because with the click of a button I can send information to thousands of people all at once.
Telephone: Yes, I still work the phones. And no matter how many times I hear no, or how many messages I leave telephone cold calling is still one of the most effective lead generators I know of.
Letters: I like to write. (Can you tell?) I usually send out letters to promote a new listing or a recent sale or lease that I have participated in. Letters are good because people will hold on to them until they need you. Just this morning I met with a gentleman who has been holding onto a letter I sent him in 2007!
Door to Door: Walking door to door can also be very effective. At the very least if I collect a business card from a decision maker I should have their e-mail address, street address and phone number that I can use to e-mail, call or send a letter to.
With no real boss but myself and no one telling me what to do, staying focused on generating leads can be hard sometimes, but as they say " work makes work." The more I prospect, the more I sell or lease.

Good selling!

The Government!

I'm not going to talk politics. And this post is not about our wonderful federal government. It is about local governments. In particular either the City or County government that as a business owner you have deal with probably a lot more than you would like. For all the talk and hype that local city and county governments put out about how business friendly they are, complaints about how difficult it is to deal with these entities are some of the most common that I hear. I am all for doing things by the book, but when doing things this way severly hampers someones ability to conduct business I have to question why?

Here are a few of the top complaints:

Business Licenses / Conditional Use Permits: We all want to do the right thing, and to legally operate your business that means getting a business license from the City in which you are (or want ) to be located. A visit to the cities Planning Department will tell you if your use is permitted at the property you desire. If it is, you are lucky! But it still means you will have to shell out some cash for the license. Many times uses may be allowed, but with conditions. These conditions may include drastic improvements to the property such as street improvements, landscaping and installing block walls. You may be required to submit a site plan prepared by an architect along with more fees. If you are required to obtain a Conditional Use Permit (CUP) be prepared to spend some serious money and wait many months. Recently I leased a building to a group that wanted to operate an indoor radio controlled vehicle track. My clients were asked to submit a site plan of the property, a business plan and a traffic study. (Which cost them thousands!) The approval process took five months, and that was quick! Imagine the dilemma this puts a potential buyer or tenant in when they think they have found the right property but won't know if they can legally operate there until they go through this process. What seller or lessor is going to take their property off the market for 5-8 months only to possibly find out that their prospects CUP was denied? If you are in an unincorporated part of the County of San Bernardino you technically need a Minor Use Permit (MUP) or CUP to operate ANY business. When you ask the Counties Planning Department how long it will take to get a MUP or CUP you will be blown away! Six months for an MUP and 12-18 months for a CUP! This problem is so bad that many businesses operate without the Counties approval.

Racking Permits: A client of mine recently told me that it took six months for the City they were in to approve their racking plan and grant them permits to install their pallet racks. Six months! It takes a day or two tops to have an engineer design a racking plan. But it takes the city six months to finally approve it? My clients specifically leased a 30' clear building so that they could use a narrow aisle, wire guided system. For months they could only stack two pallets high while they waited on the city. They now tell everyone they know not to locate there.

Code Enforcement: Again, I am for doing things by the book, but some of these inspectors get pretty nit picky, and some of their requests are downright outlandish. Clients have told me that they: have been cited for having a sidewalk where a they want plants. They have plants where they want a sidewalk. They need to put up a block wall to screen their yard. They need a permit to paint their building.

Other top complaints include dealing with the AQMD or local flood control.

If you have had a problem dealing with your local goverment I want to hear about it.

John Husing's Inland Empire Economic Outlook Report

Today I e-mailed out a link to Economist John Husing's most recent economic outlook report. Mr. Husing is considered to be the authority on the Inland Empire's economy and his report is packed with information on where we have been, where we are now and where we seem to be headed.

I agree with John that the recovery is beginning, but that 2010 will still be a tough year for most.

If you did not receive the link, or if you would like more information on Mr. Husing, please check out his website at http://www.johnhusing.com/

Appraisers and valuing your real estate.

It seems like almost every day I get a call from an appraiser, calling to discuss a deal that I may have recently done. The sad reality is that there are a lot of banks and financial institutions out there attempting to value properties that they are either trying to refinance or possibly foreclose on. These days trying to value a property can be a little tough. There is still a lot of downward pressure on pricing and a comp from six months ago may be not be considered accurate today. A good appraiser will always call the brokers who have recently made a deal on a property like the one they are trying to value and ask them what they think the subject property might be worth. The brokers opinion is held in high  regard because who knows the market better for that type of property than the broker who just sold or leased a similar one? Some brokers try to avoid appraisers but I am always happy to talk with them beacuse I really enjoy talking about real estate. Also most guys will send me the other comps they have collected when they are done with the appraisal which only helps futher educate me.

A good real estate broker is also an expert property appraiser. And just like an appraiser when I value a property I will use all three methods of appraisal: The income approach, the market approach and the replacement approach. These days however a market approach valuation is the best to use as most deals are being done by users, not investors or developers. A market approach valuation is based on recent sale or lease comparables or comps. A comp is all of the details of a deal like; How much did the property sell or lease for? Was there any free rent? Did the owner pay for any tenant improvements? And so on. Every broker in my office submits comps from deals they have done, comps from other brokers they know and comps from appraisers they speak with into one giant database. I like to think that my office has one of the best sale and lease comp databases of any brokerage house in the Inland Empire. Since I have exclusive access to the largest database of the most recent and accurate sale and lease comps anywhere, I can quickly provide you with a very accurate and detailed opinion of value for your property.

In this highly competitive market pricing your property correctly can mean the difference between getting it leased or sold quickly or having it sit for months. If you are curious what your property might be worth  call me at 909-974-4054.

I can provide you with a quick ball park opinion of value over the phone or I can provide you with a much more detailed written evaluation backed by the hard data I discuss above.

Causing Some Controversy

If you are reading this blog chances are you found out about it from an e-mail I sent you. Yesterday I sent out  an e-mail that seems to have angered a few people. In this e-mail I wrote about how landlords are really taking it on the chin lately and that as a result there are some great opportunities for tenants or buyers. My intention of course was not to anger anyone. In fact I have created this blog and send out my e-mails to have the exact opposite effect, to try and help people and possibly introduce them to some good opportunities. But I actually had a gentlemen, who is a local property owner, leave me a message yesterday calling my e-mail insulting and calling me a bottom feeder. I also had a broker friend of mine contact me and tell me that some of his clients received my e-mail and that they did not like the message that I was putting out. I send my e-mails to all types of people. Some are large institutional property owners, some are developers but most are your typical mom and pop business owner struggling to make a living just like the rest of us. In hindsight, I can see how my message could anger some property owners. Like I said above lanlords have been hit real hard lately. Property values are down significantly and many owners have been paying money out of pocket every month to cover the mortgage on their vacant building. But I certainly never said anything that wasn't true. It is a buyers/tenants market now. Three years ago it was a landlords market. Times change. I'm just calling it like it is. For a moment I thought, is what I am doing bad? But then I received a call from a major developer this morning who told me he really appreciated my e-mails and the information I had been sending out and that he had some projects he wanted to discuss with me. I asked him, did my e-mail anger you? He said why? You don't make the market, it is what it is. And he is right. So for the time being I am going to continue my e-mails, and certainly this blog. Thanks for reading!

How is the Market?

Check out my new page How is the Market? The page includes a link to the Grubb & Ellis Co. First Quarter 2010 Industrial Property Report and some good insight as to what is going on in the market today.

Getting Some Reaction

Today I received an e-mail from Mark Robinson at Performance Wet Jet in Rancho Cucamonga. Mark's lease is up in a few months and he is thinking he might be able to get a better deal than what his current landlord is asking. I think he is right. Mark is looking for about 10,000 square feet. There are a LOT of buildings available for lease in this size. (I sent him a list of about 30 properties.) Some of the more motivated owners are priced at under $.40 per square foot Gross. I look forward to working with Mark and getting him well set up.

I Need Listings!

Today I have been focusing on getting a new listing or two. I typically have anywhere from 10-20 quality listings that I service, but now I am down to about five. In the past several months my partners and I have leased or sold just about everything we have listed, and in many cases we represented both the property owner and the buyer or tenant. When I list a property, I push it hard. I have a database of thousands of local business and property owners that I regularly call, e-mail and send letters to. I also spend a lot of time walking door to door, passing out brochures. We like to think that we are one of the most aggresive industrial marketing teams in the Inland Empire. If you have a property that you need leased or sold give me call at 909-974-4054

Good Networking

Yesterday I had the opportunity to meet with Richard Woolery and his crew at Hawthorne Lift Systems and Advanced Material Handling. These guys are the local Cat Lift Truck dealer and also experts at designing and installing racking and pick systems. We exchanged some leads and discussed how our businesses compliment each other. Richard and his guys cover all of southern California and will do a great job for you. Call Richard at: 909-923-9818

Getting the Blog ready

Today I have been putting up a lot of the information that appears in this blog. I have had several websites in the past but I like the idea of a blog because it is so easy to update and keep current. I hope you enjoy it.