How do you identify a lease deal as “good” - if you’re a landlord?
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[{"id": "icmsd07", "text": "Huh?", "replies": [{"id": "icn2eca", "text": "The way I look at it - landlord has costs. Capex - inducements. If you have a 15 year deal - and get your investment back in two or three years and have revenue for 12 years - it\u2019s a good deal. \n\nHow do you determine a \u201cgood\u201d deal?\n\nRight now I have a deal for 160k retailer. It\u2019s not a market deal. How many deals like this are some a year? Not many. Market rent isn\u2019t a real thing. You follow me? My landlord has to invest 9 million to get 2 million a year in revenue. After 4.5 years they\u2019re making money. Like 20 million.  Make sense?", "replies": [{"id": "icn2rm9", "text": "Lol. God bless you, my guy.", "replies": [{"id": "icn5pfb", "text": "Lol - I\u2019ve legit been doing it this way my whole career. You know better? Tell me.", "replies": [{"id": "icn5zm8", "text": "I would tell you but you are notalistener", "replies": [{"id": "icn89a0", "text": "Now this guy is going places", "replies": [], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}, {"id": "icnsrr3", "text": "Quite honestly, this does not make sense. Nobody can make heads or tails of what you're saying.", "replies": [{"id": "icovbmf", "text": "Lol. \n\nLet\u2019s pretend I\u2019m your client and you bring me a 15 year lease deal. Why should I sign it?", "replies": [{"id": "icozrf1", "text": "&gt;Let\u2019s pretend I\u2019m your client\n\nLet's *never* pretend that.", "replies": [{"id": "icr55v3", "text": "You\u2019re all rude - typical for the cre industry. I\u2019ve been here working my way up from a secretary and don\u2019t plan on going anywhere. Guess we will see where you end up.", "replies": [{"id": "icrqei8", "text": "You can rest assured, the people down voting you aren't focused on *\"ending up*\" anywhere.\n\n\"......*and* (I) *don\u2019t plan on going anywhere.*\"......\n\nNo one assumed you were.", "replies": [], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "icnelj2", "text": "There are many metrics to review and no two deals are exactly the same.   Couple of important things consider:\n\n- credit of the tenant\n- net effective rent (rent less amortized capital)\n- payback period on invested capital\n- rent comps (v market, v. prior, v market, etc.)\n- upside like % rent, and likelihood of achieving\n\nNo one thing makes a great deal.  It\u2019s a combo of metrics.", "replies": [{"id": "icni7wm", "text": "This is such a good answer. You\u2019re right. But what is a good deal to you?", "replies": [], "depth": 2}], "depth": 1}, {"id": "icofd6u", "text": "A deal, you mean, making a profit? As long as your Net Operating Income (gross income minus expenses except debt servicing) against your cash inject is higher than a 10-yr bond rate for example, that's good. If you want, you can do discounted cashflow projections of up to 5 years and compare IRR against another comparative return metric. Is this what you are looking for?", "replies": [{"id": "icovdz5", "text": "Yes. Lol. Thank you. What\u2019s your benchmark irr?", "replies": [], "depth": 2}], "depth": 1}]