Rough Week for Investors in the Stock Market
Posted: September 18th, 2008
Category: commercial news
Investors in the stock market have been going through a rough period this week and for the last year.
Investing in tenant occupied commercial properties with a decent CAP rate is a viable alternative to investing your money in the stock market. This form of investing requires extensive due diligence but has the ability to grow your investment dollars steadily. Its no secret that we are experiencing a down turn in the real estate market. If you purchase a property in a down market with a good rate of return, as the market recovers, your property will likely increase in value. This lines up with the old adage of “buy low, sell high”. The object of this type of investing is to obtain a good return on your investment dollar and have the possibility of picking up a decent rate of appreciation as the market recovers.
Over the past few years, many commercial developers retained ownership of some of their properties and leased them to tenants. A portion of these developers are now selling their tenant occupied spaces to obtain cash to purchase or finance other deals in this market. If you are interested in earning seven to eleven percent on your investment dollars, please contact me (James West) at Maxsell Real Estate 678-741-2060 to learn about the opportunities in your area.
Discussion: Comments
Georgia Non Competes: Do the Risks Outweigh the Benefits?
Posted: August 21st, 2008
Category: commercial news, real estate news
The most recent Atlanta Business Chronicle included an article that SunTrust was relieving certain of its corporate officers from their non compete agreements. The article further discussed the most important aspect of non competes when you hire a chief executive officer or a salesperson in Georgia.
In Georgia, non competes are very difficult to enforce, more importantly, a bad non compete also results in a court throwing out a perfectly enforceable non solicitation provision. What SunTrust and other companies are appreciating is that relationship driven businesses are usually better off leaving out a non compete rather than risk losing an enforceable non solicitation clause if a court finds a non compete unenforceable.
Remember restrictive covenants come in four basic types:
1) Non competes: Don’t open up down the street and compete with my business;
2) Non solicitation of customers: Don’t solicit my clients and customers;
3) Non solicitation of employees: Don’t solicit my employees;
4) Confidential information and trade secrets: Don’t disclose my salary list or don’t disclose my proprietary software.
As always, your trusted legal resource for practical advice.
Additional Real Estate Resources:
Discussion: Comments
A Week of Change for Downtown Woodstock
Posted: August 14th, 2008
Category: Woodstock Real Estate, commercial news
It seems as if the recently revitalized downtown Woodstock is falling apart. First I heard that Serene Bean, the only coffee house in old town Woodstock, is officially closed.
Then I hear that the City of Woodstock is purchasing a building on Highway 92. They are moving city hall, police, building department, everything under one roof in the three-story (35,000 SF) former Robert Harris Homes building. Rumor has it that the price for the building is $5.6 Million. These are troubling signs for Downtown Woodstock.
But let’s look at the glass half full…
The city plans to relocate in downtown Woodstock after they tear down their old city hall and build a new one. No time frame, but at least the goal is in place. The city will save hundreds of thousands of dollars by having all operations under one roof (maybe they will even become more efficient with building permits - I know really dreaming here.) The purchase price for the new building includes furnishings (it matters when you have to staff an entire city operation, furniture adds up).
As for the Serene Bean, something will replace it and probably soon. The location is too perfect for a coffee house or similarly themed restaurant. It is the prime spot across from the park and fountain and has a great landlord committed to making Woodstock better.
There is no doubt this is a blow to vitality of Woodstock, but I think things will work out in the long run.
Discussion: Comments
Avoid Using Form Commercial Contracts in Georgia
Posted: July 21st, 2008
Category: commercial news
Pre printed form commercial sales agreements contain pitfalls for buyers unaware that the form is silent on many provisions that are critical to specific types of corporate and real estate transactions. I recently reviewed a form commercial sales agreement that addressed the sale of a business along with the commercial real estate.
The form, however, was silent on critical issues such as non competes from the seller and its principal owner. The form also did not address escrowing a portion of the purchase price for use in the event the seller breached the contract. When confronted with pre-printed form agreements, the buyer should not automatically assume this form is more efficient and costs less.
It is typically more difficult and time consuming for an attorney to review a form prepared by someone else because he or she must figure out what has been left out or not addressed in the draft contract. As a result, the buyer should always insist whenever possible on drafting the sales documents and not rely on the use of the pre printed form or other seller generated form agreement.
As always, your trusted legal resource for practical advice.
Discussion: Comments
Commercial Lease Legal Issues Checklist
Posted: July 16th, 2008
Category: commercial news
Our resident commercial real estate attorney has written his Top 10 Checklist for Commercial Lease Legal Issues to help you consider the important issues that come up in your lease.
- Confirm all financial and legal terms from lease LOI and properly reflected in the lease document.
- CAM Charges:
a) Did landlord included capital expenses in CAM.
b) Are CAM charges capped on an annual basis and is this CAM cap a cumulative one?
c) Is there an audit right, what are terms for an approved audit firm, under what circumstances is the landlord responsible for tenants fees if there is a CAM overcharge.
- Repairs
a) Does the lease clearly explain what repairs the landlord or tenant is responsible for especially as applied to HVAC.
b) Does lease require that the landlord repair the roof only to pass such repair through as a CAM charge.
- Indemnification: Does the lease include a corresponding provision that Landlord indemnify tenant for landlord’s negligence although many landlords will use the higher standard of gross negligence when a tenant requests this provision.
- Personal Guaranty: Does the personal guaranty permit its termination prior to the end of the lease term. Does the personal guaranty cover just the “guarantor” or “guarantor and its assigns”.
- Assignment:
a) Does the lease require Landlord’s consent in Landlord’s sole discretion (it need not justify its reason for giving or withholding consent) or that it won’t be unreasonably withheld (a justifiable reason must be given for withholding approval).
b) If lease is assigned does it also permit the termination of the guaranty and if so such termination language must also be in the guaranty.
- Tenant Buildout:
a) Make sure buildout is paid for by landlord and not a loan to tenant that must be repaid.
b) If landlord does not timely complete the buildout there should be liquidated damages such as free rent for each day of delay.
c) If landlord’s failure continues beyond a certain time period the tenant has the right to terminate the lease.
- Use of the Premises: general office versus a medical office. This distinction is important if a tenant wishes to sublease space. Medical office is a far narrower use than general office and therefore, far more restrictive when looking for prospective sublease tenants.
- Option To Renew:
a) Lease should spell out time period required for notice, (i.e 120 or 90 days prior to lease term ending.
b) Lease must include some basis for calculating the new rent for the option period, it cannot say fair market rent at the time of the option.
c) The tenant should be aware that the option period may allow landlord to bring current the CAM charges if they had been capped prior to the renewal term.
- Right to Relocate Tenant: Many leases allow the landlord to relocate tenant under certain circumstances. The lease should be clear that if this happens landlord will pay for the entire move and the new space is substantially the same or higher in quality than the existing space.
If you have questions, please contact Justin.
JUSTIN S. DANIELS
WAGNER JOHNSTON & ROSENTHAL, P.C.
5855 SANDY SPRINGS CIRCLE, SUITE 300
ATLANTA, GEORGIA 30328
PHONE 404-261-0500
EMAIL: JSD@WJRLAW.COM
Discussion: Comments
Quick Search
Participate
- Atlanta real estate
- marietta real estate
- woodstock real estate
- holly springs real estate
- canton real estate
- ball ground real estate
- jasper real estate
- ellijay real estate
- alpharetta real estate
- roswell real estate
- waleska real estate
