Many times, clients ask me how to "make money" in commercial real estate. There are many ways to quantify the return on one's investment. CCIM'S (Certified Commercial Investment Members), are trained in mathematical and financial formulas, equations, and disciplines to determine one's return on and of an Investment. From IRR's to FMRR's, the commercial real estate professional can assist their client in evaluating their financial Investment.
Although the evaluating tools and functions listed above are important in determining one's Investment and they can quantify one's investment, the "make money" part of the equation often comes down to what price in which the property was originally purchased.
Yes, the purchase price matters! Many say that the "money is made on real estate when the property is purchased" and they are right! The management of the investment and other financial decisions associated with the property does matter, if the property is purchased right on "the day of purchase", it does help cover a multitude of lower expectations during the term of the investment.
If you need assistance in assessing your commercial real estate investment or if you are looking to invest in commercial real estate, allow us to assist in the effort. We can provide an assessment on existing or new investments and project performance goals, while suggesting the right number to buy or sell your commercial real estate investment.