Help With A Multifamily Lease Option
I have two possible lease options on two 2 family units how can this be structured if both units are leased with tenants. Who collects the rent from the current tenants, one of the multifamilies is selling for 218,000 at 1400.00 a month but the tenants are paying 1900.00 who collects the 1900.00.
Confused someone please help me clear this up
you collect it...
Thank you we worked out a master lease which I found to be awesome. I just learned the details of applying a master lease to multifamiles and apartment buildings. Is any one familar with TIC Tenant In Common
Can you give more information about the details of the Master Lease...or where you learned the info.
Thanks...[ Edited by reiray on Date 11/26/2008 ]
A Master Lease is a Lease that allows you to sublease the remaining units or space of a commercial bulding. The Master Lease has you make lease payments to the owner that you will decide. Oftenly enough you will make the same monthly gross pymts, with the same annual NOI, but this could be completely different for you depending on what you and the owner decide.
Then you will be in charge of the management of the building, and expenses. You could also have the owner be responsible for some expenses like taxes and insurance, while you will take care of the remaining expenses. You will raise the NOI, by decreasing expenses and raising the income.
In addition you will have a contract like an Option to Purchase, along with the Master Lease.
This is what the master lease option is all about, and once more it only applies to commercial land.
This can also be done as a Master Lease Purchase, but instead you are using a Purchase Contract.
Susan Lyons (Google either Susan Lyons or The Investor Insights) and Peter Conti (on REI Club) have webinars based on this well.