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The 10-year yield was rather quiet this week in spite of concerns over tariffs continuing.  With it being summertime, many may just be preoccupied and hoping such concerns just go away.

Business and Somebody’s Watching You:

I realize that I am an analytical; and that I am constantly paying attention to details.  After interfacing with a lot of other professionals this week, this topic popped into my mind.  Whether you are socializing, working on a problem, a transaction, or on a committee, somebody is paying attention to your actions.

Now this is not to get all of us paranoid (well, maybe just a little), but what we do in various situations matters to someone.  For some this matters greatly; and for others, not so much.  However, we all are selling something to someone.  That may be an idea, a product, or ourselves.

I will let you in on my own thought process.  When I am working on getting a loan done for a client challenges arise all the time.  For those that read this weekly email often, I refer to the many professionals involved in a real estate transaction.  For once, I will not include my blue circle chart.  However, suffice it to say, issues can arise from someone dropping the ball from any point in the process.

So, a problem occurs, now what?  This is where I find it quite interesting.  Even though professional “A” did not cause the problem, they may be the most vocal and frustrated about it.  Are they the type to just get annoyed; or are they the type that will jump in (even though it is not their direct problem) and work to resolve the issue for the greater good?

Now back to the theme at hand here.  If they are the type to help fix the situation, then I am paying attention.  I am making a mental note that they are a good solid team player.  Would I want to work with them again?  Of course.  Would I want to refer them? Yep, they get that too.

My point here is how we react, how we help, and how we interact with others all matter.  If someone stays focused on the larger goal of resolving issues towards completion of tasks, then I will want to have them in my professional world more and more.  However, if they do not handle problem resolution well, then why would I risk my reputation by referring them to others?

Not everyone processes information this way.  Or, perhaps, they do not realize it right away.  Yet, our gut tells each of us when someone will protect us, help us, or work with us in such a way that we know our contacts would be safe when involved with them.

My advice is to just be aware.  How we work with each other and with clients is being noticed.  I suggest you surround yourself with professionals that make you look good, that are extremely competent, and find ways to resolve issues for the benefit of all involved.

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 5.25% 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:

The SJ Mercury News reported “Trump tariffs add another obstacle to Bay Area building.”

NREI reported “Rising Interest Rates, Bid/Ask Gap Lead to Tempered Growth in Investment Sales in First Half of 2018.”

Bisnow reported “As San Francisco Peninsula Fills Up With Office Users, Tenants Turn To More Affordable South Bay Markets.”

 

See the table below for approximate interest rates.

Type Rate Fixed Term
Apartments 4.455% – 5.080% 3 to 10 year (30 yr amortization)
Commercial 4.765% – 5.380% 3 to 10 year (25 yr amortization)
SBA Lending Call for Options Call for Options
SV Commercial Lending