Real Estate Agent's Café

Denver Resident Remodels Wrong Condo

Commercial Real Estate Going **BOOM BOOM**

Commercial Real Estate: The Next Hole in the Economy

Real Estate Babel (Part 2)

  King Nimrod

In my Post Real Estate Babel (Part 1) I put forth the theory that commercial property owners may be direct descendants of the peoples of Babylon and perhaps of King Nimrod himself.

Trying to find out what charges are in addition to the rent from most property owners that I've dealt with are, at times, excruciatingly and unnecessarily difficult. And I suspect it's this way everywhere.

It usually goes something like this:

What additional charges is my client expected to pay? 

Utilities.

That's it?

Yes.

Is the cleaning included?  

No.

OK. Is there anything else?

No.

Oh, by-the-way, what about property management?

Uh, that's extra too. Note: And this is only a partial list.

Then I'll ask for a  breakdown of the cost so my client knows exactly what his occupancy cost will be. No problem! I'll email it to you today. They rarely do. After a dozen calls and badgering I'll finally get something in writing. It still may be incomplete. Something invariably will be forgotten. I call it selective amnesia. Strickens the most lucid minds. Poor things.

I don't get it! What's the big secret? Do they think that these unmentioned expenses aren't going to come up later when the prospect gets the lease? And oh boy, the sparks really start to fly. Can't say as I blame them. Who likes surprises? Especially when you've done your planning and budgeting based upon a set of assumptions that you believe to be credible.

But in the property owner's mind the more time he can burn, the less options the prospect will have. Then he'll have em over a barrel. Or, if he tells them too much, the'll scurry away never to be seen again.

What a way to start a business relationship.

I propose that we get rid of all of this jargon and just spell it out. Think of all the extra time we'll have to focus on getting new business. But, I know the mentality. That would be too scary. Or perhaps it's that genetic connection to ancient times.

Bank Decides to Demolish New Homes

Real Estate Babel (Part 1)

You probably heard the story in the Bible about King Nimrod, who fancied himself as a real estate developer, deciding to build a tower to reach Heaven. Kind of like the mid-rise suburban office buildings that you see all over the place.

Well, it seems that God wasn’t in a humorous mood that day and sent all of the workers scattering speaking in different tongues, which is why we have communication problems to this day.

I suspect that this problem in communication has carried down through the millennia to today's commercial property owners.

Ask most Landlords (or real estate brokers for that matter) what the lease rate is, and you'll get a response that it’s “X “dollars per square foot net, modified gross, net net net, double net, or some other term that gives no information at all. 

Heck, even Tenant Electric isn't clear anymore. It used to mean lights and electrical outlets. Now, it could include heat (if electric) and air conditioning.

Between "gross" rent which includes everything with the base rent and "triple net" which includes nothing but the base rent, here are no universal terms to describe what charges are included or not included in the base rental rate.

More on this subject in my next post.

Ghost Stories From a Haunted House

The Crapper Caper

I had an interesting encounter with a real estate investor a few years back. Most of his holdings were in the market area that I serviced, so I thought that it would be a good idea to meet with him to introduce myself and my company. Upon entering his office I couldn't help be taken aback not only by the shear size and opulence of his office, but also by the huge crystal ball collection he had amassed.

I don't know if this has ever happened to you, but every once in a while something just doesn't click and the meeting labors on in an odd, awkward kind of way. This was one of those times. I found him to be a bit strange. Especially when he boasted to me that the building we were in, which he owned, was the tallest building in town. Although this happened to be true, the building was only three stories tall.

As his Secretary escorted me out I mentioned to her that her Boss had quite an impressive collection of crystal balls. Oh yes, she said,  and every so often he will bring in a fortune teller and we all have our fortunes told. 

I'm not a believer in mysticism. However, what you chose to do in the privacy of your home (or office) is your business.

I wasn't surprised to later learn that his empire had crumbled and he had lost all of his holdings, including his home, through foreclosure, which also included the "tallest building in town". Maybe having all of those crystal balls gave him too many conflicting messages? So much for fortune telling.

Not long after, I visited the now vacant space on a tour with the new owner. Gone were all of the sparkling crystal balls, shiny array of trinkets and other objects, executive desk and chair and the toilet in the private bathroom. Wait a minute. The toilet! I have heard of cases like this before, where people have absconded with their beloved commodes, but I have never visited an actual crime scene.

How did he pull this off? Did he dress up like a Ninja and on a moonless night, make his way with flashlight and wrench in hand, and ever so quietly unbolt the porcelain beauty from the floor? I can picture this blackened egg shaped figure hugging his loot, stealing down the stairwell, leaving a trail of water and jumping into his get-a-way car, burning rubber out of the parking lot.

And what was the motive? Could it be that he refused to abdicate his Throne? Or was it something more sinister? Was he holding poor Johnnie hostage to be used as a bargaining chip as he negotiated with his lender? Was Bidet involved as an accomplice? It was all speculation.

As time went on I had forgotten all about this crime until one day when I was at a business luncheon the alleged perpetrator's name came up in conversation. From the other side of the table a residential broker chimed in saying that she had the listing on his house and the lender kept asking her; what happened to the toilet? Whoa! A double hostage situation. I kept silent choosing not to compare notes with her for I was determined to solve this case on my own. And I didn't want to share any of the credit.

From time-to-time I would ask; what ever happened to so-and-so? I would hear rumors that he was residing with a woman in one of our seedier urban neighborhoods near the pawn shop and bail bond section. However, most of the information usually lead to a dead end. Until one day I caught a break. A trusted informant told me that he had seen a flyer advertising how the alleged perpetrator had reinvented himself into (and I'm not making this up people)

a "Healer".

The pieces finally came together. It was a clear case of Porcelain God Worship! Now I know some of you (not me of course), perhaps during your college years, knelt down at least once before the Porcelain God and thanked it profusely for its presence.

As he stood before his flock dressed in Monk like attire or perhaps a Snuggie (which would do in a pinch), sporting a toilet seat around his neck, with the lid up behind his head to give him that "Halo" effect, he said unto them, (click to hear what he said unto them) and proceeded to lead his followers up in single file to kneel before the Porcelain Gods to be bathed in the magical, mystical healing waters.

In the words of McGarrett; (click to hear the words of McGarrett)

 

Case closed.

 

Note: For additional viewing pleasure click the Snuggie link above for the Snuggie Parody.

 

 

 

Real Estate Knuckleheads

They have to be commercial brokers.

Watch it when you have the time. Runs 7 1/2 minutes.