Re: Commercial Real Estate Funding

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Posted by ray@lcorn on January 21, 2010 at 09:09:05:

In Reply to: Commercial Real Estate Funding posted by John on January 20, 2010 at 18:36:29:

John,

Most banks I talk to are requiring minimum 25%-30% cash equity. That's not to say you can't get a deal done with less, just the generic answer you'll get if you call up and ask the question and have had no previous conversations with the lender.

If you have a pre-existing banking relationship (e.g. other loans, deposit accounts, credit lines, etc.) things can be much different. There are a number of ways to skin the cat, especially on foreclosures and REO properties.

We've used several strategies to gain control of bank-owned properties before they hit the market. Two have been very effective, our "White-Knight" strategy of taking over existing loans at par rather than short-sale negotiations, and a "Manage-to-Own" strategy for over-leveraged property with upside potential.

ray

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