Richard Sorrentino ATR

I am going to show you a basic plan for what to do to get started. And that is what it will do. It will get you started. Long run, you need a professional web site. You need a professional presence online. But if you start small and reinvest your profits, you can grow big if you just stick with it.

Let's begin:

1. Analyze and tie up a commercial property opportunity to sell . You are going to use someone else's commercial property because you do not have your own, yet. To find a commercial property to sell, develop a professional relationship with a qualified commercial real estate broker willing to work with you, that will send you pocket listings that meet your acquisition criteria. (eg. 100 plus units, no chiller systems, B or C plus with individual metered units and significant upside ) You are going to represent yourself as a professional commercial property acquisition company. We will address in depth, the specifics of developing relationships with commercial real estate brokers in another article and how to get them to send a stream of pocket listings that meet your acquisition criteria across your desk.
2. You are going to need an auto responder account, I like to use aweber, this is a paid service. There are free services also like mailchimp.com. Basically what an auto responder does is allow you to set up a series of messages that go out to a subscriber. For example, someone will subscribe to your list and they will receive an automated, personalized email welcoming them to the list. On a pre-determined schedule (determined by you), the auto responder will send to your subscriber a series of emails with information from you.
3. Third,, you must write a series of email letters. This may seem absolutely daunting at first, but just do it. The first ones you write may be lousy, but you will get better. The first email will just be a welcome email; thanks for joining my list; here are a few tips about (investing in commercial property). The next few emails should be informative, offering the subscriber free tips about finding commercial property. At the end of the email, include a link to the product you have chosen to promote. Click one of my links at the end of this article to get a series of emails from me; that will give you an idea of what you want to do.
4. Once you have the auto responder account set up, with a few messages (I will cover the content of those messages later), you will generate a web form or link from the auto responder that will allow the subscriber to "opt-in" to your list.
5. Advertise the web link or web form in commercial property related ezines, newsletters, or high-traffic web sites (as banner ads, exit pops, etc.). When the readers read your ad and click through to your link they will become subscribed to your list.

The commercial property syndication marketing system invites investors to learn about how your business model works.

Here are a few things to think about: Are you tired, of seeing inflated promises for commercial property systems that promise you will make money? Pyramid schemes of specific amounts of money just waiting for you to collect?

The online commercial property education marketplace is a maze of contradiction: if you want to make money badly enough, you will do what it takes to learn how professionals make money in any market. Many legitimate, some not so legitimate, and other system approaches are unethical and immoral, and you are able to make money in many different ways---

It is important to remember that there are No guarantees. I hope this turns on some light bulbs about what is possible online. Perhaps you have simply been too scared of trying to build a commercial property syndication from scratch, or of even using a coaching system to do it. Maybe you just don't think you can spare the money to get a commercial property syndication off the ground. Maybe you just are not sure what to do and how to do it. Keep in mind, that, as simple as I may have laid this out, it will take some time before you become good at it. You will experience a learning curve. Some of you will write good copy and bad copy. You will write effective emails and ineffective emails. You will make sales. You will lose money, but you do not have to. The key here is to test everything you do. Track the ad through your auto responder service (build a different auto responder for each ad you run) so that you know which ads produce the best response. Then repeat.

A commercial property investment is a business investment. Determine the investment numbers and you will determine your success ratio for performance of your investment. The following three formulas will help you to choose your level of risk, before you submit a letter of intent. Remember a commercial property is a business that is an illiquid investment. Your investors money will be tied up until you sell the property. It is a cash in cash out, income generator with costs, debits, and depreciation. The commercial property business is subject to geographic and socioeconomic factors that will determine influence ROI. Here's how you get started with some simple calculations prior to performing complete due diligence:

CAP Rate or capitalization rate is used to determine the current or present value of a property that will create future earnings. It is a determining number used to estimate the projected value of an asset class of properties. It is also a discount rating and calculated by:

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Net Operating Income (NOI) / Purchase Price = Capitalization Rate.

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This following example would be considered a good rate of return. Class "A" multifamily for $1,000,000 produces $100,000 in positive net operating income (NOI) each year, then the formula would be as follows: Net Operating Income / Purchase Price = CAP Rate $100,000 / $1,000,000 = 0.10 = 10% Therefore, the commercial property's capitalization rate is 10%, which would be the annual return on your investment.

Cash Flow is money going in and out of your commercial property business , and is determined by three things to look at annually: rents, expenses, and debt service. A simple cash flow formula:

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Annual Rents - Annual Expenses - Annual Debt Service = Cash Flow

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A $25,000 cash flow into your multifamily each year would be determined as follows: Class A multifamily rental return is $100,000. Annual expenses are $40,000. Annual mortgage debt service is $35,000. This means that in order to find out what your cash flow is, you would follow the formula: $100,000 - $40,000 - $35,000 = $25,000

Cash-on-Cash Return - The cash-on-cash return is the ratio of annual before-tax cash flow to the total amount of cash invested. Cash on cash formula:

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Cash Flow / Down Payment = Cash-on-Cash Return

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If you had put down $250,000 for your multifamily property, your cash-on-cash would be: $25,000 / $250,000 = 0.10 =10%

ROI return-on-investment cash dictates how much profit you will make on your multifamily property investment.

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Total Financial Benefits / Down Payment= Return-on-Investment (ROI)

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Let's assume that before you bought your multifamily property, you were informed that your total financial return would be $35,000. You would figure out your return-on-investment as follows: $35,000 / $250,000 = 0.14 = 14%

These are simple calculations you can make when you are looking at a commercial property pro forma to determine if you want to move forward with in depth due diligence. Remember these are general numbers and only begin to tell the story before complete due diligence can be done.

How to use seven steps to make sure your Letter of Intent process is complete. What if you discovered a simple list that you can use to follow the progress of a completed Letter of Intent? Here is a seven step check list to follow:

Letter of Intent

1. Reviewed and signed off by you

2. Reviewed and signed off by legal

3. DD can expire without obligation by buyer

4. Deposit release requires affirmative written action

5. Sufficient time for due diligence

6. Sufficient Time for Financing

7. Deposit goes hard on:

Step 1: Reviewed and signed off by you: You can easily use this reminder that you have reviewed the letter of intent and approved it. Just sign or check this step and make note of the date. Here is legal reminder to follow.

Step 2. Reviewed and signed off by legal: Use this reminder that you have reviewed the letter of intent and approved it once it returns from your lawyer. Just sign or check this step and make note of the date. Here is the DD time line reminder, next.

Step 3. DD can expire without obligation by buyer: You can easily use this reminder that your due diligence timeline ends without financial consequences to you as the buyer.

Step 4. Deposit release requires affirmative written action: Reminder that your hard money deposit will only be returned by written agreement. Make sure your letter of intent has this clause to protect you if you decide to walk away from the deal. Check this and make sure your lawyer includes this clause.

Step 5:Sufficient time for due diligence: Check the amount of time you asked to complete due diligence. Then check again, allow a sufficient number of days with a built in extension if time lines are not met by the seller.

Step 6. Sufficient Time for Financing: In today's investment market, financing takes longer, negotiate sufficient time, then ask for more than you need.

Step 7. Deposit Goes Hard On: When do you need deposit money on the table? Agree to a date and do not deviate.

You want to issue a letter of intent to get an investment tied up and you agree on the stated terms within the letter. The letter of intent is basically a statement that the seller is looking to sell and that you are looking to buy. The letter allows for an inspection period and a financing period that is called due diligence . But that is not all . . .