Parking: These Overlooked Real Estate Investments Are Great Choices Today

smart older real estate investor once told me, “In lean markets, buy raw land and hang onto it. Land can’t burn down. Nobody can steal it. If you’re patient, its value always increases. And you don’t even have to insure it.”

That’s wise advice. Yet undeveloped land isn’t the only smart real estate investment for lean times. Here are some other investing options that can generate self-sustaining income while they increase in value.

Buy rural or suburban land where you can build and operate a self-storage facility until the market strengthens. Self-storage facilities are great “placeholder” businesses that generate income from land until it can be sold at a profit. They are cheap to erect, they don’t require much heating or air conditioning – and they generate good profit per square foot. To learn more, attend the Inside Self-Storage World Expo that will be held from October 5-8 in Washington, D.C.

Buy a modest business located on a piece of land that is appreciating. It could be a grocery that’s adjacent to a mall that is expanding, or a liquor store that’s in an urban area that’s gentrifying. Look for a business that’s profitable enough to cover its expenses (utilities, property taxes) until you sell it. Consider buying a business from owners who are willing to run the business for you until you decide to sell it. It’s a win/win proposition: They get the money from the sale of the business immediately, and you get experienced people who can run the business until you sell it. To learn more, investigate The Art of Buying a Business program from Trump University.

Put up a parking lot in an urban setting. Parking facilities generate more income per square foot than most people realize. According to a recent article on Gaebler.com, it is not unreasonable to expect a modest urban parking lot to gross as much as $6,600 a day. If you want to learn more, subscribe to Parking Today Magazine.

Lease vacant retail space and sublease it to Pop-Up stores. Pop-up stores, a hot trend, appear in vacant stores during peak selling months – then close down and disappear. And they are not just Christmas or Halloween shops. This summer, big retail players like Brooks Brothers and Hermès have been opening pop-ups in upscale locations like New York’s post Hamptons. One problem? You’ll probably want to avoid leasing mall space for this purpose, since mall managements generally exert tight control over tenants, signs, hours of operation and more.

Those are only a few good choices for recessionary times. If you know more, please take a moment to make a comment on this blog post. Let’s share our ideas and get ready to make a lot of money when this recession turns around.

by Barry Lenson for The Trump Blog

Source: http://www.trumpuniversity.com/blog/post/2009/08/these-overlooked-real-estate-investments-are-great-choices.cfm

Student Housing in Nilai (Desa Palma)

This morning, a friend of mine passes me a flyer for StarZ Valley, a new development in Nilai. This flyer has triggered me to blog about student housing in Nilai; or more specifically in Inti Uni Colllege Nilai.

I get know about this development since mid last year. However, after checking out the price & build up (last year), I feel it’s more viable to buy an existing apartment called Desa Palma. In fact, I bought 3 units (from sub-sale) in Block E Desa Palma back in Oct 2008 @ RM85k each. Current asking price for units in Block E is hovering around RM140k to RM150k. I’m not sure what the recent transaction price is but estimated paper gain of RM65k just in 3 years is definitely not bad! Which work out to be 25% gain each year. I believe launch of StarZ Valley did influence the price hike in Desa Palma. Thanks to StarZ Valley developer.

Now, let compare Desa Palma (DP) and StarZ Valley (SV).

Desa Palma, DP:
RM150k @ 728 sq.ft = RM206 psf
Installment (30 years) = RM720

StarZ Valley, SV:
RM109k @ 296 sq.ft = RM372 psf
Installment (30 years) = RM530

Average rental for my DP units is RM750. By assuming 3 person stays in this 3 room’s apartment, each student is paying only RM250.

For SV’s studio unit, installment alone is already RM530. I got to know that a major airline is paying RM500 for accommodation allowance. That means we are limiting our market to selected rich students, steward/stewardess or airport staffs. Or course some people is arguing that there is a lot of rich students in private colleges like Inti. However, based on my experience; student is always a student and their spending power is not that high as what we thinking off.

With limited tenant market in Nilai for higher-end (or higher rental) apartment & supply of 1000++ units in SV, I suspect the rental in SV may not even able to cover your bank installment. Furthermore, I don’t think the units can be easily rent out within 1 year of completion due to many cheaper options in Nilai.

For those speculators that intend to buy SV, the target completion is Dec 2014. Do you sure what is the property market by then?

Anyone have different views are welcome to comment.

Location of StarZ Valley & Desa Palma. Both are walking distance from Inti International University. Due to close proximity, Desa Palma is the first option for students in Inti NOW.

StarZ Valley flyer that i get this morning