Benefits of Cypress Outdoor Furniture in Commercial Properties

Deciding on patio furniture for a commercial landscape can be a daunting task. Often, it can be difficult to predict what kind of qualities will give owners the highest ROI. While inexpensive pines are an economic choice, going with a high quality outdoor wood will elevate the appearance of your landscape.

Outdoor furniture represents a huge investment for commercial properties and it is obvious that patio furniture is constantly exposed to the elements as well as heavy use by the clientele. While there are any number of styles and materials suitable for commercial outdoor furniture, consider the many benefits of selecting furniture constructed using cypress wood.

Cypress wood inherently has properties that make it an ideal candidate for durable lawn furniture; hundred year-old cypress wood timbers are still in use. While other trees, like maples, contain a sticky sap, the cypress tree contains cypressine. Cypressine is an oil that naturally preserves the wood even better than man-made oil compounds used to make treated lumber. Cypress is an excellent choice for outdoor furniture at coastal commercial properties since it resists the salty air as well as fungus and insects.

Cypress wood is also incredibly easy to paint. Being able to add unique and vibrant colors to your commercial property’s outdoor furniture will make your site cheery and memorable. Whether choosing to create a color palate, or unifying your landscape with one consistent color, adding paint elevates any commercial area. Plus, brightening up your site is as easy as applying a new coat of paint!

Cypress outdoor furniture is an accessible, affordable, and high quality wood that will resist environmental damages, elevate the luxury of your site, and will let you add color to all of your outdoor furnishings.

Can I Get a Commercial Mortgage Without a Deposit?

The mortgages typically require the borrowers to make large deposits. The industry standard for their deposits is 20 to 40 percent of the property value. Why? Because they are considered to be risky by banks and lenders. They increase the size of the deposit to reduce that risk.

As surprising as it may be, a higher deposit is not necessarily undesirable for businesses either. It comes with its own set of advantages. It reduces the interest rate and the repayments, thus saving a significant amount of money for businesses over the course of the repayment schedule. However, for cash strapped businesses, or for high growth businesses whose money is better directed towards powering that growth, a large deposit can be a huge pain point.

But, there is no escape from it. Businesses have to pay a deposit to get a one.

That being said, businesses can avail a commercial mortgage by paying a deposit that is quite close to zero. Here’s how.

1. Type of Commercial Property

Every business and its industry have a certain degree of risk involved. This risk changes from one industry to another. Naturally, some commercial properties are deemed to be riskier than the others. For instance, a business that is getting a one for a medical office may end up paying less than 5 percent of the property value as deposit. On the other hand, most other properties like retail shops, office buildings, and the likes, require the businesses to pay at least 20 percent of the property value as deposit.

So, check out the existing industry standard for the deposit of a commercial mortgage on your property.

2. The Type of Lender

Banks have the lowest risk appetite. Hence, they make the businesses pay the highest deposits. On the other hand, private lenders typically have a higher appetite for risk. So, if you approach the private real estate lenders, the chances are that you will end up paying a significantly lower deposit than what you would have paid the bank.

3. Trading History

Commercial mortgage requirements change from one lender to another. However, the lenders usually trust businesses that have been in the market for the longer duration. New businesses may be required to pay a deposit as high as 50% of the value. So, if a business wants to take a mortgage by paying a low deposit, then it should probably spend a couple of years in the business first. In the meantime, renting can be the answer to their immediate needs.

4. Security Requirements

This is one of the most effective strategies for reducing the deposit on your loan. Most lenders hold the property you are purchasing as the only security. However, some lenders are flexible on this. They can accept your equity in other properties or your other assets as security for the mortgage and reduce the deposit to a fraction of its earlier value.

Commercial Property Investing: A Team Sport?

Sometimes adults act just like little kids. The pathetic part is occasionally that time is when we are investing in real estate. Maybe we feel we have read enough books and know exactly how to do it. Maybe, you heard how your neighbor had a great purchase on a small residential purchase. Maybe, we are convinced that Donald Trump is really not that smart… maybe he was just at the right place at the right time. Or, maybe, just maybe guys are absolutely positive about how to do it and they tell their wives or friends and then refuse to back off when they should.

I was one of those guys, I knew everything and if I didn’t I could hire someone who could. Yep, I was an absolute genius, with a full wallet. I told my wife and my friends how I had it all figured out. My wife just nodded like she does when I’m driving and refuse to use the GPS or ask someone for directions, even when I’m completely lost. My close friends were polite but strongly suggested I rethink what I was doing.

However, even an absolute genius, with a full wallet, a plan and pride the size of Texas was not going to back off and lose face. I knew how easy it was, buy a small rental house, fix it up and lease option it. A piece of cake.

I will leave out all the horrible details that follow as life seems better without dredging them up too often, besides the headaches and nightmares have finally gone away. Let’s just say that I lost my shirt when the market tanked, when the tenant got angry and trashed the house and fled in the night and when month after month of maintenance, utilities and taxes were eating away at that pride of ownership while sucking into my savings. That was real Genius.

Coincidentally, I was receiving checks twice a year from the group investment on a medical office building that I got into a few years before the crash. I was and still do earn a tidy 12% cash on cash return per annum. Due to slowly rising rents built into the leases from day one, strong tenants, premium location and amortization of the underlying mortgage the value of the building has gone up over time. So, simply put my principal is safe, I earn actual real dollars every year and the overall investment has gone up in value.

The office building purchase was a group of physicians who got together and built a building. We all became tenants and brought a few more non owners in to increase the cash flow. We all considered the risks as a group and the group was committed to the success of the building.

Now, if you have the cash on hand you could go and buy a nice class A office building or medical office building yourself. Since, YOU are a genius and have a full wallet. However, my advice from the trenches is to STOP right now! It takes some work and effort to manage the building and real expertise when things go wrong. If you have a group behind you those decisions are not solely yours and some of your partners might actually have good ways to solve those problems. In addition, by putting less into the investment you have reduced your risk and allowed the group to buy perhaps a bigger and better property.

Obviously, things can go wrong with group investing on real estate. I am not saying they can’t. But, with a group your risk is mitigated, you have people you can turn to when there is a problem and you can as a group buy a piece of real estate of substantial quality and value that you could never accomplish alone. Remember, one of the icons of American real estate The Empire State Building was built by a group of investors, not one man who refused to ask for directions when lost. That is real genius.

Choosing The Best Commercial Real Estate and Retail Space

Starting a business is exciting; you get to be your own boss and call all the shots. No matter what type of business you have, whether its retail, a hair salon or a restaurant, you will need prime retail space in order for your business to take off. They type of commercial property to lease depends on the type of business that you have. You will also need to select a location that will receive a lot of traffic and around other businesses that are complementary.

When you check out the retail property for the first time you want to make sure that there is enough room. Close your eyes and visualize everything in the space. Is there a break room in the back for employees? What about a restroom? Don’t forget to make sure that will be sufficient utility resources to support your business. Always make sure that you visit many properties before you decide on a final one.

Location is imperative and you want to set up your place in a location that is easily accessible via the main roads and freeways. Locations in malls and shopping centers tend to receive a lot of foot traffic. Find out if there are a large number of competing businesses in the same area. It may not be a good location if there are too many competitors in the area because the market may be already saturated. You might also want to consider if the neighboring businesses in the area complement yours.

It may be a good idea to talk the person who last leased the same space. Ask them why they left and if they feel the location is suitable for your business. Price is another factor to consider. The most expensive retail spaces are in big fancy shopping miles. A space in a small strip mall is most likely to be more affordable.

Commercial leases can be very complex and involve many stipulations and fine print. You may consider utilizing the services of an attorney to make sure that you are getting your money’s worth. If you are leasing a large retail space and spending a lot of money, you will have more bargaining power and will be able to negotiate strongly in your favor. Commercial renters have less rights and protections than residential renters so it is good idea to have a seasoned expert handle all of the paperwork for you and negotiating on your behalf.

If you have any questions feel free to ask your attorney and the property management team. Establish who will be responsible for maintenance, insurance and taxes. Starting your own business is a big deal but a prime retail space can be a massive boost.

Texas Real Property Law for Commercial Landlords

I have found that landlords generally face the same set of issues and have the same set of questions pertaining to their rights, duties and obligations as landlords under Texas law. The answers to these questions depend on whether residential tenants or commercial tenants are involved. Although commercial and residential property ownership and operation have some similarities, the differences are numerous and diverse enough to justify separate treatment for each area. This article is intended to discuss issues related to commercial property with commercial tenants only. This article is my attempt to create a quick and very general reference guide on the rights, duties and obligations of commercial landlords and operators under the Texas Property Code. It is by no means complete, but hopefully is informative enough to assist the reader in asking informed questions of legal counsel and thus be more efficient and economical while consulting legal counsel.

You should not take this article as legal advice, and I strongly urge you to seek competent legal advice for your specific situation. The Texas legislature updates and passes new laws relating to landlord/tenant issues on a regular basis. In addition, Texas courts regularly interpret these laws. Thus, the laws discussed in this article are in effect as of December 2005. I have not assumed any duty or obligation to update this article beyond this date.

I. Duty to Mitigate

If a tenant abandons the leased premises in breach of the lease, the landlord has the duty to mitigate (lessen) the damages that the landlord would experience as a result of the abandonment. Thus, the landlord should not let the premises lie vacant in hopes of being able to recover lost rents from the tenant. This duty to mitigate damages may not be waived by the tenant, so any provision in the lease that tries to waive this duty or exempt the landlord from liability is void.

II. Security Deposit

A security deposit is any advance of money, other than a rental application deposit or an advance payment of rent, that is intended primarily to secure performance under a lease.

III. Retention of Security Deposit

Before returning the security deposit, the landlord may deduct from the deposit damages or charges for which the tenant is obligated under the lease or resulting from a breach of the lease. However, normal wear and tear (does not include deterioration that results from negligence, carelessness, accident or abuse) may not be withheld from the security deposit.

If the landlord retains any portion of the security deposit, the landlord must refund the balance of the security deposit and give the tenant a written description and itemized list of all deductions. However, this description and itemized list is not required if the tenant owes rent and no controversy exists concerning the amount of rent owed. The refund and written description and itemized list of all deductions is not required until the tenant gives the landlord a written statement of the tenant’s forwarding address for the purpose of refunding the security deposit. However, failure to provide a forwarding address does not cause the tenant to forfeit its right to receive a refund or a description of deductions.

IV. Refund of Security Deposit

A landlord must refund the security deposit not later than the 60th day after the date the tenant surrenders the premises and provides notice of the tenant’s forwarding address.

V. Change of Landlord/Owner and the Security Deposit

The new owner or landlord of the leased premises is liable for the return of the security deposit starting from the date title to the leased premises is acquired, except where the new owner acquired the premises by foreclosure through a real estate mortgage. However, the former landlord or owner remains liable for the security deposit received while the person was the owner or landlord until the new owner delivers to the tenant a signed statement acknowledging that the new owner has received and is responsible for the tenant’s security deposit and specifying the exact dollar amount of the deposit.

VI. Liability of Landlord for Security Deposit

A landlord who in bad faith retains a security deposit is liable for an amount equal to the sum of $100, three times the portion of the security deposit wrongfully withheld, and the tenant’s reasonable attorneys fees incurred in a suit to recover the deposit. It is presumed that a landlord who fails to return a security deposit or to provide a written description and itemized list of deductions on or before the 60th day after the date the tenant surrenders possession is acting in bad faith.

VII. Preventing Access to Leased Premises

A landlord may not intentionally prevent a tenant from entering the leased premises except with permission of the court unless such prevention results from (i) bona fide repairs, construction or an emergency, (ii) removing the contents of the leased premises abandoned by a tenant or (iii) changing the door locks of a tenant who is delinquent in paying at least a part of the rent. The lease may alter this provision.

VIII. Changing Lock Due to Delinquent Payments

If a landlord changes the door lock due to delinquent rent payments, the landlord must place a written notice on the tenant’s front door stating the name and address or telephone number of the individual or company from which the new key may be obtained. The new key is only required to be provided during the tenant’s regular business hours and only if the tenant pays the delinquent rent. The lease may alter this provision.

IX. Landlord’s Removal of Property After Abandonment by the Tenant

A landlord may remove and store any property of a tenant that remains after the premises has been abandoned. The landlord may also dispose of the stored property if the tenant does not claim the property within 60 days after the date the property is stored. The landlord must deliver by certified mail to the tenant at the tenant’s last known address a notice stating that the landlord may dispose of the tenant’s property if the tenant does not claim the property within 60 days after the date the property is stored. A lease may alter this provision.

X. Abandonment by the Tenant

A tenant is presumed to have abandoned the premises if goods, equipment or other property, in a substantial enough amount to indicate a probable intent to abandon the premises, is being or has been removed from the premises and the removal is not within the normal course of the tenant’s business. The lease may alter this provision.

XI. Interruption of Utilities

If the tenant pays for utility services directly to the utilities companies, the landlord may not interrupt or cause the interruption of such services unless the interruption results from bona fide repairs, construction or an emergency. A lease may alter this provision.

XII. Removal of Doors, Windows, Locks, Hinges, Etc.

A landlord may not remove a door, window, attic hatchway, lock, hinge, hinge pin, doorknob or other mechanism connected to a door, window or attic hatchway cover from the leased premises. Additionally, a landlord may not remove furniture, fixtures or appliances furnished by the landlord from the leased premises. However, the landlord may remove these items for a bona fide repair or replacement, which must be promptly performed. A lease may alter this provision.

XIII. Landlord May Terminate Lease Due to Public Indecency Conviction of Tenant

A landlord may terminate a lease signed or renewed after June 15, 1981 if the tenant or occupant uses the property for an activity for which the tenant, occupant or any of their agent or employee is convicted of public indecency (prostitution, promotion of prostitution, display or distribution of obscene materials, sexual acts with persons under the age of 18, etc.) and such person has exhausted or abandoned all avenues of direct appeal from the conviction. Notice of termination must be by written notice within six months after the right to terminate arises. The landlord obtains the right to possess the property on the 10th day after the date of notice is given.

XIV. Notice Requirement Prior to Eviction

The landlord must give a tenant who defaults or holds over beyond the end of the term at least three day’s written notice to vacate the premises before the landlord files a forcible detainer suit, unless the parties contracted for a shorter or longer period of time in a written lease or agreement.

The notice to vacate must be given in person or by mail at the premises in question. If notice is delivered in person, it may be by personal delivery to the tenant or any person residing at the premises who is 16 years of age or older or personal delivery to the premises and affixing the notice to the inside of the main entry door. Notice by mail may be by regular mail, by registered mail or by certified mail, return receipt requested, to the premises in question. The notice period starts from the day on which the notice is delivered.

Copyright 2005, Tri Nguyen