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Again, this past week saw little movement in the 10-year yield.  Until something noteworthy happens, I will just move onto some commentary.

Focus versus Keeping your Blinders On:

I attended a meeting last week; and the moderator was being helpful and suggested to all to “keep their blinders on” in this down inventory market.  I know he was trying to encourage folks to minimize their distractions.  However, this got me thinking which usually means something will end up in the weekly blog.

So, here is where my mind wandered off to.  In any profession, I agree that one needs to maintain their focus and limit distractions.  Nevertheless, I find THE most valuable professionals are in search of ways to help their clients succeed.  In the image below (that I have used many times in many different ways), there are lots of different professionals that can be involved in a real estate transaction.

Spotting Opportunities:

Let’s assume that you have built this network of professionals in an efficient way.  You expect (or perhaps demand) that each one has to be quite good at what they do.  And, you need them to be organized (to minimize the amount of work you need to do unnecessarily), be great at follow-up and follow-through, be able to troubleshoot problems, provide superb customer service, and to spot opportunities that can make clients better off.

Now, realistically, many professionals accept mediocrity (while others hate it).  Putting myself in the shoes of a client, I know I would want those professionals that want me to get the best possible service.  I would want these specialists to focus on MY needs as a client versus their own.  And, I would willingly send other quality people to these experts as my way of showing my appreciation.

Staying focused on the client’s needs and objectives (and then finding solutions) is a great way of separating oneself.  Far too many professionals are focused on their own needs; and, therefore, often miss ways to truly help and protect a client.  The need for completing the transaction outweighs the need to analyze the client’s problems or objectives.  In my little nirvana, I would want the business partner meeting with the client to ask lots of questions to determine the client’s needs.  Then I would want that virtual partner to call those Resourceful partners to find the best course of action.

When business gets a little slow, many find it is just too tough to survive.  What I am suggesting here is that you find those resourceful, ethical, organized, and highly competent partners to align yourself with.  Get known as the specialist that exists to better client’s situations.  In addition, utilize these partners to insulate and grow your own business as many of them will have a mindset that can spot opportunities for improvement in your business model as well.  Note it is critical that you find ways to appreciate this type of business partner (reciprocity is key).  If they are willing to help you grow your business, then you should do the same in return.  Otherwise, one of your competitors might find a way to steal this resource away from you.

Wrapping this all up, I have a feeling you will become much more effective than if you just kept your blinders on!

Investments Opportunities for Purchase with Strong Cash Flow:

Back on the January 15th update, I wrote about “Creating Residential Listings Using Commercial Opportunities.”  Each week,  I am presenting some of those investment opportunities to better educate all on what is actually available.  Note that these are all Single Tenant Net Leased properties that have listed in about the last 10 days.  In addition, I assumed a 5% loan with 50% down.  This is just a small sample of what is actually available.

If you assume investors in the Bay Area are getting a cash flow of 3.5%, then you can see the potential improvement with these properties above.  This approach is great for the investors desiring increased cash flow, an opportunity to get out of daily property management, and/or taking the challenges of rent control off the table.  Should you wish to discuss any of these or others, then give me a call.

That’s it for this week.  As always, feel free to give me a call with any of your strategic financing needs.

Articles of Interest:

Forbes reported “4 Reasons Silicon Valley Will Not Move To Detroit.

Commercial Property Executive shared “Riding the Tech Boom in Seattle.”

Cheri E. Michaelis, a San Jose Estate Attorney, shared “Moving or Buying Property in another state? Evaluate your estate plan.”

The SJ Mercury News reported “Here’s how the Bay Area job market is doing.

Bisnow reported “Morgan Hill Wants More Industrial, Commercial Development.”

See the table below for approximate interest rates.
Type Rate Fixed Term
Apartments 4.325% – 4.960% 3 to 10 year (30 yr amortization)
Commercial 4.655% – 5.260% 3 to 10 year (25 yr amortization)
SBA Lending Call for Options Call for Options
SV Commercial Lending