Multi-Family Remains Strong in the Midwest

original article published in Midwest Real Estate News on October 26, 2010 by Dan Rafter

Bruce Gerhart, Senior Vice President and Midwest Regional Director based out of the Cleveland office of commercial mortgage banking firm Love Funding, says that the multi-family industry has remained strong due to its cautious nature.  Gerhart states, "Within the Midwest, there has been very little building over the past eight, nine or 10 years when it comes to multi-family. Multi-family really has been underserved with you compare it with single-family housing in the Midwest. This under-building has helped to keep multi-family steady even as the economy goes through its difficulties."

He goes on to say that due to the economic slump more people are looking to rent as opposed to owning a home, and therefore there is a higher need for multi-family buildings.  He also states that the multi-family industry took a hit early on, but has been able to take advantage of the tough economic situation.  When these multi-family units took a hit early on, landlords struggled to keep their building fully occupied, and thus, rents went down.  Today, rents are stable and in some cases, they are even going up.

To Read more of Gerhart's thoughts, CLICK HERE.

What are your thoughts?  Is the Multi-family industry really as solid as we think?

Property Management, The Savior of Commercial Real Estate

According to Dave Petersen, Chief Executive Officer of the asset management company of Chicago's NAI Hiffman, believe that today’s challenging commercial environment, property management services have provided struggling brokerages with a reliable source of income.

Dave Petersen

Dave states, "When you are working in property management, you are creating other access to revenue streams. In the product that you lease and manage, other transactions occur. You are creating deal flow within that asset-managed portfolio. You are providing your leasing brokers an additional opportunity to call for business as they are out trying to fill space in buildings."

Dave goes on to say that being in the business of property management in today’s economy allows you  to be at the table with tenants.  Tenants today are gold in the eyes of investor clients.  Dave feels that nothing helps operating costs more so than being able to have a good tenant in place.

To view the rest of Dave's interview with Midwest Real Estate News, please CLICK HERE

Is it necessary to have a new survey when purchasing commercial real property?

There is no hard and fast rule. In general, it is always preferable to have a fresh survey so you know exactly what you are buying. But if there has been a survey within the past few years and you are convinced after looking at the property that nothing has changed, your lawyer may tell you that you can safely avoid getting a new survey.

Also, be aware that if you are borrowing money from a commercial lender, the lender will probably order a mini-survey (sometimes called a mortgage report). While this is not as good as a full survey ordered for your benefit, your lawyer may conclude that it is adequate for your needs. This is particularly true if, based on the lender’s survey, the title insurance company is willing to guarantee that there are no boundary line problems.