The franchisee at my Pizza Hut, well he died late last year.

Without a source of income on the place, I priced it $100,000 over the price I paid for it. I should have done more as I had two offers on the place and a third party wanting to lease it out. I got these offers without using a realtor - only the local Chamber.

Of the two offers, first one was all cash - fast close and only 10 day inspection period. The price was $50,000 less than I wanted but no strings. The second offer was almost full price but required just about every possible inspection around. I took the fast cash.

Had this NNN restaurant been closer to my own back yard, I would have been even more greedy. With it being 600 miles from me, I wanted ease and speed in the transaction.

I am now working another 1031 exchange - my upleg.

Lesson for all..........when other people are running from a niche, (in this case restaurants) look at that area and see if it is due to special or system variation. When I bought the Pizza Hut in 2021, restaurants were a dirty word due to C-19. That Pizza Hut did 1.1M in sales that year. If you were in the carry out business restaurant business - you smashed records as long as the government allowed you to stay open.

What are the opportunities in your backyard?

Mike do you think that the advances that were made with virtual meetings will go away? If so maybe office spaces will bounce back.

I don't think that is a solid niche. But I do like strip mall as niches. Think a medical service providers will be going away? Do you think non-profits will stop helping those in need? You are in Texas - do think kids will not want ice cream?

How can you tie in the local school into that strip mall?

There is a website called bizstats dot com. That site will tell you the mark up on specific items and businesses. If you know a funeral director, maybe they can start selling memorials out that strip mall. Doughnuts and drinks are big businesses that might be great fits

Congratulations on the sale.

Nice, so if I read that correctly the fast sale should net you around $50,000? Woo-hoo! Take that to the bank any day for holding onto something a couple of years.

The commercial opportunities in my area continue to be automotive shops and storage units. There are no storage units for sale, and most places have wait lists for units of all sizes.

The issue is acquisition: neither category of property are cheap any more, and they're also hard to find. There is nothing worth looking at below $1 million unless it's off market. The property I recently purchased included 8 automotive shops (add a 9th if you count the HUGE auto-glass shop), and also 8 retail units in a small strip mall. The thing that made this opportunity work was the high price point: not a lot of investors can afford a place that big. No small businesses can afford it.

Since renter demand is also high, my goal with this one is converting to commercial condos on the strip mall. Sell those off to individual business owners and keep the rest.

Commercial properties in our area - some go in and out of business so quick you'd hardly know they were there. Or turn over and there's been 5 restaurants in the space of one in as many years. And a lot of the spaces have no set purpose: one near me has been an attorney's office, a gas fireplace store, a private home, forget what it is right now.

We had a very nice convenient shopping center near us with half the satellite stores empty for YEARS. It's been taken over and now will be a Marshall's, Rack Room (do we NEED another Rack Room anywhere?) and a few other small stores. I don't know what will make or break it.

Demand in the residential market isn't the issue for me. The calls for things like nationwide rent control have me concerned. If that was the only issue going on, I'd chalk it up to the standard background noise and dismiss it, but given that there are still markets to this day that haven't expired their Covid eviction moratoriums, calls to ban "discriminations based on income", and remove the ability to do background check, I think the Pro-tenant movement is gaining traction. Sometime, possible as soon as 2024 depending on who wins what and how much of a majority, there could be sweeping legislation that impacts the rights of private property owners.

The crux of the matter is if we wait and see, by the time the problem arrives, it will be too late to do anything about it.

There are times that you really want to pull the buyer off to the side of the room and smack them. This closing was one of them.

The property is located in a land trust. The buyer absolutely did not want to keep the place in a trust as they didn't understand what it was.

I explained that keeping it in the trust name and transferring both the trustee and the beneficial interest would allow them to prevent the property taxes from going up. Additionally, I could talk to the bank about the buyer assuming the existing financing. I fully expected the the bank to say that they needed a huge fee to do this (based on the low interest rate), but the NO came from the buyer. He said he was going to pull cash from LOCs and refinance the LOCs into fixed debt after closing. Hmmmm pay for two closing on a commercial place.

I told him that wasn't a bad idea, but the existing financing on this commercial loan is 3.75%. I asked What his rate was going to be knowing that market rates are between 6.75-7.12% depending on collateral. He said he hadn't gotten that far but wasn't interested. Well I am not going to spook the kid. I shut my mouth.

When I think about huge mistakes though, that one made top of the list for March in my eyes. About a $160,000 oppps in extra interest payments and forces the payment up the payment about 27% while raising property taxes 11%.

Ray,

What kind of buy in are these wells needing?

These wells need nothing....they are tossing out checks monthly. You would be doing a 1031 into into producing mineral rights. They are expected to be producing for about the next 20 or so years. So this would pay like you had a 20 year mortgage on place paying roughly 10%. This is a 100% passive investment. Minimum investment is typically $100,000 but they might go smaller. They have about $6M to sell off.

17 Producing Wells in Ward County, TX

• 6-8 Additional Potential Well Locations

• 60% Oil, 20% Natural Gas, 20% NGL Product Mix

• Long Term Return Estimate: 9-10%

• Current Commodity Price Return Estimate: 11-13%

Ray - Are you investing further in oil with these wells?

Ray - Are you investing further in oil with these wells?