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13
Mar, 2025

How To Negotiate Cap Rates With Commercial Property Brokers

Here’s a clip from one of our monthly ATL Zoom Meetings. Inner Circle Member Gustavo asks Rob Rowsell about negotiating with commercial property brokers. Can buyers negotiate cap rates? The answer is YES! You CAN work out attractive financing deals with real estate brokers and sellers – every deal is different!

Negotiate Cap RatesRob Explains How To Negotiate Cap Rates

We know that the market, as well as a property’s location, condition, and income production are factors in its cap rate. The brokers themselves can also factor into that number. Rob provides a few tips on how to negotiate cap rates on commercial real estate deals, specifically with property brokers.

While brokers are responsible for getting the biggest returns for their partners, they may also resort to casting a wide net for investors. Every broker has their own top five investors. When none of those work out, they may turn to the other brokers in their office for recommendations. If each of their top five investors pass, the next step is looking for retail buyers.

Building Relationships With Brokers

Then you, a seasoned property investor, come along. Take the time to convince them that you know what you’re doing before attempting to negotiate cap rates. You are not a fly by night operation. When you build a relationship with a broker, you can submit offers that are more realistic than the ones they’ve been sitting on. Maybe the first few offers get rejected, but when the selling broker learns that you know your stuff, you are more likely to get calls from them in the future.

Remember, if you become a member of Rob’s Addicted to Life Community, he will personally inspect your underwriting. What could be better than getting advice from the best?

Join Our Multifamily Investing Community Today

Do you own your own multifamily rental properties? If not, do you plan to do so one day? Then you should consider joining our online financial group, the ATL Inner Circle Community! Each month, investing pro Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not quite as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!

6
Mar, 2025

Cap Rates Deep Dive

Rob Rowsell answers a question from a caller about commercial real estate cap rates. Rob follows up with a deep dive on capitalization rates in the property investment industry. Watch and read along to learn everything you need to know in this cap rates deep dive!

Commercial Real Estate Cap RatesCommercial Real Estate Cap Rates And Property Values Explained

Our caller Deon asked if a “6” cap rate was ideal before making an offer. Rob clarified that his initial example was based on a “6” rate. Really, Rob views that number as a starting rate when making a quick valuation, then you will want to dig deeper to see if you can do better. Depending on the situation, another rate could work better. Many factors, from the market to the broker, could affect what rate you want.

What formula do you use to determine a commercial property value?

Rob explains that this formula differs from the one we use for multifamily property values. In that situation, you compare recent sales near the dwelling you’re looking at. When looking at a commercial property, you can divide the Net Operating Income (NOI) by the Market Cap (Capitalization) Rate. You will then arrive at the value of the commercial property.

For example, you pay $1 million cash for a property. It brings in $100,000 in Net Operating Income. Therefore, you paid a “10” cap for that property. A more realistic scenario would be paying $1.7 million cash, bringing the cap rate to 5.8 – thus, Rob’s initial example rounded up to 6.

When you take the time to calculate realistic numbers, you will know whether or not a property is worth your time. Do your due diligence, because commercial investments can be risky business, even for seasoned pros!

Join Our Multifamily Investing Community Today

Do you own your own multifamily rental properties? If not, do you plan to do so one day? Then you should consider joining our online financial group, the ATL Inner Circle Community! Each month, investing pro Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not quite as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!

27
Feb, 2025

Debt Coverage Ratio Explained

Multifamily Real Estate Investor Rob Rowsell explains the Debt Service Coverage Ratio Formula. How, when, and why should you use the DSCR (or DCR) loan formula? If you can’t answer those questions, then this video is a must watch!

Property Investment Debt Service Coverage RateDebt Service Coverage Ratio Formula

In this clip, Rob explains a crucial formula for members in our monthly Inner Circle Community Gathering.

The Debt Service Coverage Ratio Loan formula is as follows: DSCR = NOI (Net Operating Income) divided by Annual Debt Payments. This includes the loan principal, so do take care if you have an interest only loan. In that instance, you will want to review the amortization schedule in order to determine your true percentage rate.

Why is it important to understand this formula? Banks use it to determine if they will grant a loan to your project, as well as the amount. In Rob’s experience, banks prefer a 1.25% ratio. Sometimes, he can’t get that number because of renovation plans. When his team crunches the numbers, the project still makes sense financially. In this instance, lenders occasionally will allow a bridge loan, in which the property investors have a set amount of time to up the Debt Service Coverage Ratio and make the loan worthwhile. If the investors fail to make the difference in that time, a penalty will apply to cover the bank’s losses. Make sure you read the fine print of your loan agreement and plan accordingly!

Join Our Multifamily Investing Community Today

Do you own your own multifamily rental properties? If not, do you plan to do so one day? Then you should consider joining our online financial group, the ATL Inner Circle Community! Each month, investing pro Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not quite as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!

21
Feb, 2025

Why Pay For Apps? Benefits Of Pay Apps For The Wealth Minded

Why should you pay for apps? You get a lot of benefits from free apps on your phone and computer. However, millionaire real estate investor Rob Rowsell has reaped many rewards and learned so much by subscribing to paid apps.

Pay For Apps - get value in subscription learning appPay For Apps? But There Are So Many Good Free Ones!

Rob is a huge proponent of Youtube Premium for overall learning. Youtube has provided him with so much wisdom about health and wealth, as well as his walk with God. With Youtube Premium, he can download videos and listen to them on the go. This is critical, since he travels often. Many of the public internet connections he encounters are not so great.

As your wealth increases, your financial needs will become more complex. For that reason, you will need to change up your learning routine. The easiest, most convenient way to do that is through online apps. As you’ve no doubt found, you usually get what you pay for. Even if one subscription isn’t living up to the hype, it’s easier than ever to cancel and try another one.

Stop being a cheapskate – take a chance and subscribe to some paid apps! You never know how much you will get back on these investments!

Join Our Multifamily Investing Community Today

Do you own your own multifamily rental properties? If not, do you plan to do so one day? Then you should consider joining our online financial group, the ATL Inner Circle Community!

Each month, investing pro Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not quite as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up for a free call today!

14
Feb, 2025

Millionaire Tax Strategy: Why The Wealthy AVOID H&R Block!

Real Estate moguls Rob Rowsell and Jake Garcia explain a key millionaire tax strategy. Learn why that you should NEVER use cheap tax planning services like TurboTax or H&R Block if you want to grow your wealth.

Millionaire tax strategy: Hiring the right tax strategist CPA to reduce taxes makes a huge difference in wealth planning.Millionaire Tax Strategy: What Should You Look For In A Tax Strategist?

Rob continues Jake’s point that the wealthy need more advanced tax preparation than those with average incomes. Remember, the more complex your business situation is, the more complex your tax strategies need to be. Therefore, you want to employ a CPA who can act as your personal tax strategist and financial planner.

One key millionaire tax strategy is finding legal ways to reduce taxes. As Rob has said many times, money saved on taxes is an additional income stream. When searching for a new CPA, you want to look for one who understands this concept. They should also provide good advice on how you should invest those funds so they will return passive income to you going forward.

Remember, smart business owners always surround themselves with advisors who have more knowledge than they do. This is especially true with regards to their accountants and financial planners. Hire the right tax strategist, take their advice, and then watch your wealth compound!

Join Our Multifamily Investing Community Today

Do you own your own multifamily rental properties? If not, do you plan to do so one day? Then you should consider joining our online financial group, the ATL Inner Circle Community!

Each month, investing pro Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not quite as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Sign up today!

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