investing in strip malls

[sandeja16]

I am looking for a good investment in real estate...the apartment complex sector is very over priced at this time here in south florida...I have changed directions and have started to look at strip malls...they seem to be throwing off a little bit more $ and initially seem like less of a headache...what are some of the pitfalls with investing in this type of commercial realestate??  Am I correct in thinking that this could be a good initial investment?

[tedjr]

Howdy Sandeja16:

The only problems that I know of is when your anchor tenant moves out and you are stuck with a large vacant  space and more than likely a lot of your smaller tenants are looking to follow.  A lot of the new tenants will rehab their own space buy may want help from the landlord as well. Also the lost rent could be for years and wipe out a small investor with no other income or reserves to carry a vacant building.

What kind of cap rates are you seeing in Fla on centers

LOL

[sandeja16]

the cap rates are in the 8 - 11 % range

[Mark Saenz]

Hello.  I am located in AZ.  One of the things I have learned about here is redevelopment.  I used to own a Laundromat and what my landlord did was just fix up the place.  The guy's name is Michael Pollack and he is making money hand over fist buying up old strip centers and fixing them up, often times putting in a new anchor, raising rents (and foot traffic) and even getting the city to kick in for fix up costs.   Its beautiful!  Hope this helps.

Successful Investing,
Mark

P.S. You can find the guy at www.pollackinvestments.com