I have a new deal, we’ve just opened escrow. So let me start at the beginning. When I’m hunting for a deal, I’m combing through CoStar or brokers are presenting me deals that they think are of interest, that meet my buying criteria. For me, that means it’s got significant upside value add potential, and there’s way for me to force appreciation into the property.
If that looks like it can happen, what I’m gonna do is write an offer. It’s a non-binding offer, a letter of intent as we say in the business, to establish all the deal terms. If that gets accepted by my seller and I sign it, then I have my attorney draft the purchase and sale agreement. So that takes them a couple of days. That is the binding contract, that’s what we’ll use to close the deal. We send that over, everyone executes it. Now we can open escrow, I wire in the earnest money deposit and the due diligence party begins.
In this case, I have 45 days to break down the deal and look at it. I’ve got the due diligence volt at that point, it’s been sent over via Dropbox or Google drive. And so I’m reading through leases and we’re doing a forensic financial accounting. We’ll go out and this is what I’m doing on Monday to do a tenant interview. Get to know the tenant, understand the health of their business. Are they looking to extend their lease? Are they looking for more space? Are they looking for less space? How are things going? What are some of the things that they might want a new ownership group to know about or to plan for?
If I like everything that I’m hearing there I’m gonna then go and order third-party reports. And if there’s a bank or a lender involved usually they’re going to initiate this. But in this deal, actually I have two of them going, we have seller financing. So I’m still gonna do that just to make sure my interests are protected, my investor’s interests are protected.
We’re gonna do a couple of the major ones. We’re gonna get a phase one environmental report done. We’re gonna get a property condition assessment done, and I’ll probably get a new survey done just to make sure I’m buying what I’m buying, right. So once that’s all complete, I’ll then go out and get my new loan. In this case, we have that done already because the seller financing has been agreed upon. And then we’ll go raise the equity. So I’ll say, hey dear investors here is the opportunity that’s available.
I’ll make a presentation, I’ll share that with everyone who’s on my investor wait list. And then if that all comes together as planned we’ll close the deal and I’ll turn around and hand it off to my property manager to then onboard the tenant, to start collecting the rents, to create the budgets for the year, to do all the triple net and cam reconciliations and all that fun stuff that I like them to do. So I can be free to go buy another deal, just like this one. That’s the process and what I can do is give you updates along the way, a little short snippets, but this gives you a good sense of what the whole process looks like. If you have more questions about that definitely hit me up with a comment or a question. We can do a follow-up or work this into the, you know the real time updates as we’re out there at the property in a couple of days.