Poking holes with Greg Scully

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5 • 831 Ratings

🗓️ 22 October 2021

⏱️ 24 minutes

🔗️ Recording | iTunes | RSS

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Summary

Mike Taravella discusses the importance of understanding your rent roll as a buyer and an owner. Key Information: Your rules of thumb need to be updated as the market changes! Take a look at your underwriting for insurance, taxes, etc. to make sure things haven’t changed. Keep engaging with insurance companies annually as well as replacement costs may be changing drastically How are your taxes assessed? Do not assume the previous taxes and do not assume you will be reassessed at the time of purchase. Know your rules! Know your property and what the various projections mean. Your deal on paper is 1 of 1,000,000 things that could happen to the property Have defensible underwriting. What is conservative and why? Be able to backup your projections based on your market research. Understand management and what value it adds to/takes away from you. Does self-management make sense? Pro tip: Have your team work items separately and aggregate results to prevent group think and/or confirmation bias. Contact: RealWealth.Solutions – All contact info is on the site! To register to invest with us: https://jandg.activehosted.com/f/58 Rand CRE’s Facebook: https://www.facebook.com/randcre Rand CRE’s Linkedin: https://www.linkedin.com/company/randcre Rand CRE’s Instagram: https://www.instagram.com/randcre

Transcript

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0:00.0	Welcome to the RAND-CRE show, commercial real estate with no stone left unturned.
0:09.5	Hey, everyone. Welcome to the RANDCRI show. I'm your host, Mike Tarvella, and today I have an extinguished colleague, a partner of mine. I have Greg Scully. Greg has participated in over 300 units.
0:23.2	He has been a great partner of mine and the RAND team for two deals. And I really respect his
0:29.7	cheery disposition when it comes to the frothiness of the commercial real estate market. So Greg,
0:35.2	welcome to the show. How are you? I'm doing great, Mike, trying to keep my energy up. I'm doing good. What's up? Yeah, just living the dream one day
0:43.3	at a time. Excited for a minute for- Yeah, I was just doing, I was just doing a spreadsheet.
0:48.0	I love, for those who don't know, Greg is not just cheery all the time. So this is a little of the sarcasm that he brings to the table every day. But Greg, I appreciate, you know, obviously all jokes aside, we like to partnering
1:01.3	with you two deals now. I think you provide a different perspective in the sense of the cheery
1:07.0	optimism. It only goes up. If you buy now, it only goes up. Obviously, you have experience
1:12.7	under your belt, but you've kind of seen a lot of different things versus the novice investor who just
1:20.2	says, hey, let's tweak the spreadsheet and it only goes up. So when looking at spreadsheets or
1:25.9	kind of just where we're are in the market, what are some things that you do to give a heat check,
1:31.0	whether it be the underwriting, looking at markets, what have you?
1:35.8	I mean, like very much right now, property taxes and insurance are like two of the big
1:41.3	things that have creeped up lately in that insurance has just gotten
1:46.2	more and more expensive. And every time I think I have a new reasonable rule of thumb,
1:51.0	we get a quote and I'm like, oh, I got to move my rule of thumb up. So, you know, in our market here,
1:56.1	Central Eastern Tennessee, it depends on class. It depends on a lot of things. But if my,
2:00.6	if my rule of thumb
2:01.7	two years ago was, you know, $300 per unit for insurance, it went up, it went up, it went up.
2:08.5	And now it's like $450. So if anybody hasn't underwritten for a while or recorded insurance,
2:15.4	that's, that's been a big one lately. Not in a flood zone or anything?
	...

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