Black People : Buying Abandoned Buildings

Discussion in 'Black People Open Forum' started by karmashines, Jan 28, 2006.

  1. karmashines

    karmashines Banned MEMBER

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    In another thread, Jamesfrmphilly said:

    This strategy could be used to start really whatever type of business would
    be necessary to establish black economic solidarity.

    What do you think of this idea and what is the best way for individuals to implement it?
     
  2. kemetkind

    kemetkind Well-Known Member MEMBER

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    Can you broaden the scope of the thread to include building black institutions?

    I think the choice of location and infrastructure is likely a case by case decision, depending on the resources one has at their disposal. But the discussion of concepts/strategy, funding options, planning milestones, etc. could be shared by all who are interested in this.

    I personally would have less interest in factory buildings since I would rather build out on owned land, but I would benefit from a discussion about what to build and how.
     
  3. jamesfrmphilly

    jamesfrmphilly going above and beyond PREMIUM MEMBER

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    philly once had manufactoring jobs.
    when i was young we all had jobs.
    the black community was prosperous.
    now we are all poor and the entire area is abandoned (but you can screw a white woman)

    i live in a converted factory building.
    the building next to me has internet businesses and artists and start up tech businesses. the next building over is an afrocentric charter school.
    there are plenty of old abandoned factories here. they are pretty cheap. the biggest expense would be clean up and rehab.
    we have all the infra structure in place. transportation, communication (fiber optic in the ground) power, water and sewage.
    white artists from NYC come down and buy entire buildings to use for studios.
    it's all good in north philly.
     
  4. kemetkind

    kemetkind Well-Known Member MEMBER

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    Can you dig a little and get a ball-park figure for $/sq. foot or purchase cost for available buildings in that area? Many metro areas in southern cities have already started this gentrification crap and the costs are pretty high.
     
  5. karmashines

    karmashines Banned MEMBER

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    This thread is here for any type of pondering on what to do with the abandoned building. So yes, you can focus the discussion on that if you wish.

    This is not an area of expertise for me so I myself personally will not be able to offer 'blueprints' for implenting how to do this. But I hope others that do know about it will put their heads together.
     
  6. Omowale Jabali

    Omowale Jabali The Cosmic Journeyman PREMIUM MEMBER

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    consider purchase through foreclosure or tax lein. the purchase costs can be considerably lower.

    cities such as baltimore have a lot of low cost properties near the downtown area...whites also have been involved in gentrification and find a way to do it.. familiarize yourself with GRANT programs that are available..a good person to ask would be brother GRAND HUSTLE who has shared infomation with me before concerning tax lein property available...commercial or industrial...


    i have a strategy that also can work for some of you interested in real estate investment...it involved purchasing property and being able to extend your line of credit, then using the equity as investment capital...this can increase your own personal net worth while adding to your real estate acquisitions...what you do with the properties is up to you...

    it does require investment, refurbishing, then having property reassed and then being able to secure a line of credit at a higher reassesed value...this is an excellent way of buying and maintaining investment property which one can use as income property which not only pays for itself but it also give you a tax deduction which can also lead to a higher return which in turn can be used as investment capital...i worked this formula the past two years and was able to retire early, even though i do need to generate more income after being off work the past seven months...

    what this requires is a market analysis and you must take the time to study the market in your area....there are many high risk areas with high income, which can also mean high rental income potential, but the area may have a high foreclosure rate which may present some problems in securing credit...

    in the old days what some of my elders did was bought triplexes and duplexes, lived in one unit and rented or leased the remaining units...this way they were responsible for their own property management...check the zoning requirements in each area...some allow commercial usage of residential properties...some have zoning restrictions....if one can secure residential property in quasi-commercial areas the property can gain higher rental to buisness owners with a higher likelihood that the property will be maintained to health and safety standards, otherwise, the business will not be able to obtain licensing..

    good luck and best wishes to each and every one of you in your endeavors..

    something else, i have not noticed any INVESTMENT forums here....i view all real estate purchased as capital investment and i also have spent some of my acquired equity as stock investment capital....in effect, i timed the market, reduced the number of accounts (consolidated) my stock portfolio, invested in a roth ira account and purchased stock in sirius satellite when it bottomed at $2.45 per share....

    the stock has fluctuated but more than doubled.....i had bought it at a higher price, sold before it declined to and bottomed, then re-invested and now am just watching my equity grow....

    i say this to suggest that in developing a business plan, before purchasing any property, view yourself as an ESTATE and develop the mindset of estate management and if you are planning to develop a corporation or institution, study the STOCK PORTFOLIO of similar corporations and institutions...

    a lot of institutions are able to maintain themselves not by generating their own revenue from clients, but by CORPORATE INVESTMENT....
     
  7. Therious

    Therious Banned MEMBER

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    CHECK YOUR CITY FOR FUNDING PROGRAMS PERTAINING TO REALESTATE. IN NORFOLK VA, THEY CITY'S URBAN REDEVELOPMENT PROGRAM PAYS FOR REHAB OF NECESSITIES. SUCH AS, PIPES, ROOFING, INFASTRUCTURE ECT. HOWEVER THERE ARE STIPULATIONS AND THIS MONEY IS LOANED. THERE ARE SOME GRANTS AVAILABLE BUT YOU MUST LIVE IN THE PROPERTY FOR LIKE TEN YEARS.

    THERE ARE SEVERAL FACTORIES HERE. I DROVE PAST THE ABANDONED PLANTERS PEANUTS FACTORY THE OTHER DAY. THEY OUT SORCED THE ENTIRE OPERATION OVER SEAS AND LEFT THIS HUGE ABANDONED FACTORY OUT IN PORTSMOUTH VA.

    SIMPLY CHECK WITH YOUR CITY HALL, FIND OUT WHO OWNS ECT. TAX LIENS USUALLY REQIRE A PERIOD TO WAIT THEN YOU HAVE TOP GO THROUGH COURT PROCEEDINGS. HOWEVER IF YOU CAN GET THE HOUSE ITS A GREAT INVESTMENT.
     
  8. karmashines

    karmashines Banned MEMBER

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    Wow. Thank you so much for providing such a detailed, well-thought out post giving the general facts on how to do something like this.

    Now, the problem many are going to face is having lack of capital and/or bad credit. My situation is like this... we do own our house now, which is good but our credit is pushed up to the max. The little bit I have free I use for entreprenurial ventures to try as fast as possible pay off that debt. I would also need capital to hire people to fix up the building as I have no idea to do that, and my husband is too tired from work to do things like that.

    Do you know of any real estate investing clubs that allow a group of people to invest without having to use so much capital?
     
  9. Omowale Jabali

    Omowale Jabali The Cosmic Journeyman PREMIUM MEMBER

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    No, I am not familiar with any investment clubs but you probably can web search in your area. As far as the credit situation, welcome to the club. This is why I suggested grant, rather than loan programs..since MOST african-americans have poor credit ratings (one reality and example of Institutionalized racism) this is a major obstacle which needs to be overcome by most....as far as hiring people to do the work, view yourself as a "contractor" (yes, this is legal...lol!) and find a good real estate broker to help you search for properties....many will help you to search without an upfront fee because the field is very competitive...the other thing is they know "handymen" who you could subcontract to do "fix up" and terms of fee payment can be negotiated....real estate brokers tend to have handymen as regular :associates: and while you may find some suspect I found the one i used to have completed my renovation at a much lower cost than if I had done the work myself...these handymen also have their own crew of workers and they try to keep their own overhead down..just keep an eye on their work without getting in the way...

    as far as your own credit situation, no need to provide your personal details but if you don't already have a line of credit...i suggest refinancing and securing a lower interest rate...find lower terms with no prepayment penalty....if you are able to refinance...whether your property was re-assessed at a higher value or not (hopefullly it would be), apply for a HELOC (home equity line of credit)...if you are able to secure a HELOC most likely they will pay off the second mortgage you just obtained, and/or give you a line of credit in which you could re-consolidate your mortgage payments AND credit card debt....only use % of HELOC to pay off high interest accounts....this should give you some investment capital if done correctly, with a higher net asset value on your home and increased net worth in your pocket....while decreasing your overall debt...just avoid new car loans and restrict shopping for non-essentials...the other thing is securing credit at outlets such as lowe's, home depot, best buy....the are places where you can shop around and purchase appliances, fixtures, etc. for you -refab, while paying off long term on credit-installment plans...depending on the amount of credit you qualify for.

    i am explaining to you exactly what i was able to do, a single man with only one income and very high overhead....i started out with $120k as assessed value of my condo.....it increased over a 13 year period to $175k....1 year later to $250-275k and i eventually sold at $430k....this is a home appreciation value of $255k within a 2 year period....and my home was able to bring in $55k more than it's assessed value at the time of the sale...why?....because the renovation was complete and the home looked like new....completely new fixtures, appliances, flooring, paint, all for est $7k....and this is in los angeles which has high building and supply material costs...but very affordable LABOR...

    i won't get into many more specifics only to say i was able to put 20% down on a relatively new home purchased through HUD foreclosure sale and the funding did not come from my pocket, but i was able to use the HELOC to make down payment...it was kinda tricky but the bank actually worked with me...within a six month period, about 1/3 of my home value is in equity....and the assessed value increased 11%...(unfortunately, so did my property taxes..LOL...!!)

    Think about it....when was the last time you got a pay increase on your job within a 6 month period that equaled or exceeded 11% while reducing your debt to income ratio? (in this case I have no income except for interest bearing account, but reduced debt)..

    by the way....there are low cost home improvement loans which are 100%tax deductible...if you are successful in securing one, you can use to renovate your own home first, reassess, secure HELOC, pay off loan and use remaining % of HELOC as investment capital....or, bank the money until you are ready to invest...
     
  10. jamesfrmphilly

    jamesfrmphilly going above and beyond PREMIUM MEMBER

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    look in here in real estate and see: http://www.philly.com/mld/philly/
     
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