home base business

Office Condos: An overview of what they are and how they might work for you

By: Jeff Hammerberg

The condominium concept emerged in the 1970s as a unique alternative to traditional apartment leasing and single family home ownership. At first the idea ? which involves partial ownership in a larger collective or association of similar properties ? gained traction in vacation destinations. Instead of forking over excessive amounts of money to buy pricey beach property, for example, a buyer could buy one slice of a larger pie at a more affordable price. And as an alternative to perpetual rental ? which offers no tax benefits or equity accumulation ? owners could purchase their apartments or holiday retreats, without having to buy an entire apartment building.

Now the same idea is spreading within the market for traditional office space, where a condo office is defined as an office building with two or more individually owned units. The rest of the property ? for example the parking lot, landscape and lobby ? is owned in common and equally shared by all of the condo owners. In other words, condo ownership of an office works the same way it works in a residential condominium setting, and the terms of ownership are outlined in office condo association by-laws.

During the 1990s developers in many cities around the country overbuilt office space to keep pace with the exploding high-tech industry. But then the industry shrank as many of the start-up ?dot-com? companies that the offices were meant to house went out of business. Many of those costly projects were hard to sell, because the need for huge office property evaporated, leaving developers saddled with inventory and financial liability. They offered to sell off offices piecemeal, rather than waiting to lure well-heeled buyers who could afford the whole building.

Suddenly the condo office frontier was discovered, as innovative commercial brokers began to divide up skyscrapers and sell single office units or floors of office space, rather than trying to market the whole enchilada. The concept caught on, and continues to be a popular and less investment-intensive alternative for those businesses or professionals who would like to own their own office but don?t want to build or purchase an entire building in order to do so.

Occupancy costs combined with the loss of potential financial incentives usually weigh heavily into the choices of those who opt for the office condo alternative. Most office condo owners cite control of their property as the most compelling reason for the purchase, and they list tax perks and financial advantages as other contributing influences affecting their decision. If you rent or lease, your ability to redesign and remodel may be limited by the flexibility of the landlord. And if you decide to move, you may have to forfeit penalties for short-circuiting your lease. Even if you time the relocation to coincide with the expiration of your contract, you never get to enjoy equity appreciation like you do with owned property.

Availability is another powerful issue, because someone needing a relatively small can find office condos in a variety of sizes and configurations, even in the most popular parts of town. Office condos are especially popular with those who want to establish themselves in a specific location where buying a building or constructing their own is not practical. Small professional firms can buy condos that range from 1,200 to 50,000 square feet, inside large buildings in competitive markets like New York, Los Angeles, Chicago, or Washington, DC. Office condo development is also becoming more common in mixed-use properties where office and retail condos are designed into the first floor of a residential condo project. You can buy your home upstairs, open your wine bar downstairs, and visit your corporate accountant or attorney in their office condo next door.

As condo owners outgrow their original offices, they often acquire another condo in the same building or purchase strategically located satellite office condos. Thanks to the potential to profit from market appreciation, many office condo owners finance their expansion and relocation through sales of existing sites, just as first-time homeowners trade up to larger homes.

Right now the market for office condos is relatively new and somewhat untested. But as companies increasingly shift to a virtual online presence versus a brick and mortar headquarters, the demands for gigantic offices may fade, in favor of agile and adaptable office condos.

Flipping office condos may become the next bull market opportunity, and those who already own them may be well positioned for the future. Residential condos were considered an inferior investment vehicle when compared to single family homes, until about a decade ago. But then they caught up with and surpassed traditional homes in popularity and investment performance.

Regardless of what investment yields they offer, office condos are already convenient and economical, and those are the most important reasons why many experts believe they are the way of the future.

To inquire about office condo properties from a broker committed to serving the GLBT community, visit www.GayRealEstate.com. To help finance a commercial or residential real estate purchase, visit www.GayMortgageLoans.com. Or just call toll free 1-888-420-MOVE (6683).

Article Source:
http://www.articlecity.com/articles/business_and_finance/article_8917.shtml

Making A Profit On Investment From Social Lending Sites

By: Ivan Mantelli

The worldwide lending industry is a multi-billion dollar industry where people borrow from banks, financial institutions and other private lenders. In the last couple of years, the lending industry has gone through an evolution and has given way to social lending as the new and promising mode of lending. Also known as peer- to- peer lending or person to person (P2P) lending, one of the first companies to set the base for social lending are Zopa, Prosper and more recently LendingClub.

Zopa is considered the first social lending marketplace in the world and its roots are in the United Kingdom. With the launch and immediate success of Zopa, other similar peer to peer lenders have sprung up like Prosper in the US, Boober in Netherlands and Smava in Germany.

If you are wondering whether the P2P loans offered at the social lending sites are worth it or not then the answer is most likely yes. There is not much of a difference as far as the P2P loans from these lending hubs and from a bank is concerned. The difference lies in the fact that there are no banks, no long procedures, and no middleman and above all the entire process is transparent for both the lenders and borrowers (no more hidden hard to find loan agreements!).

The main objective of the social lending hubs is to offer an online loan with the best interest rates and to make customers feel like they are borrowing from a friend or community. This peer to peer borrowing is increasingly being seen in a new light and is being considered as a part of community borrowing (which was more traditionally offered by small local community banks).

Other benefits:

 Creation of a new asset class: Lenders on any of the peer to peer lending hubs can now take advantage of a new asset class, which they can add to their portfolio because it doesn?t fall under an investment or even a savings account.

 Choosing interest rates and loan repayment: There are several benefits for lenders as well as borrowers. In social lending hubs like Zopa or Prosper, lenders have the freedom and the flexibility to choose a loan repayment time period as well as the interest rate on the p2p loan.

 Active community participation: one of the salient points is that this kind of a lending hub make borrowers feel as if they are following from an actual person and not an organization or a faceless institution. Hence it helps in developing a strong community feeling.

Lenders at any of the social lending websites have the power to set a minimum interest rate that they want to earn and can bid in an increment of $50 till $25,000 through loan listings. Borrowers can create a loan listing for a period of 3-years, and borrow an amortized and unsecured loan of up to $25,000 and also provide the maximum interest rate that they will be able to pay a lender.

The success of Zopa lies in its facts and figures. They are the largest lender today and have loaned out in excess of $930,000. The return on investment for lenders has been around 5.01%, which is healthy especially in the wake of the fact that social lending is still in its nascent stages. One of the top lenders even got an ROI of 19.8% on social lending websites.

The Lenders

By now you are probably thinking who these lenders really are? Are they banks in disguise or are they really other people? The truth is that they are really people. Let?s take Zopa and Prosper for example. Both the social lending hubs are backed by Benchmark Capital who also funded eBay. Zopa or Prosper are the best alternatives that anyone can have to banks or other financial lending institutions, however they are restricted to the UK and US markets.

The current business model of Zopa is based on a 1% exchange fee that borrowers are paying them upfront. In return, Zopa is offering borrowers a better interest rate by cutting out the bank middleman. More than that, a borrower will have more control of the entire lending process and has the flexibility to establish an interest rate.

Zopa is the acronym for Zone of Possible Agreement, and its lenders include only U.K. residents who are over 18 years of age. To qualify as a lender, a person needs to have a valid bank account and a high personal Equifax credit rating. There are two restrictions for becoming a lender and they are:

? Lenders have to be individuals and not businesses.

? Lenders will not be allowed to have anything in excess of £25,000 ($47,000) in outstanding loans at a given point in time.

The American counterpart of Zopa is Prosper and they also handle maximum loan of $25,000 at a time. At this point the future of social lending looks bright as it has now hit New Zealand and Australia with the first peer to peer lending hub in Australia to launch shortly being Lending Hub (you can see their site at lendinghub.com.au and their active blog at blog.lendinghub.com.au) which will offer P2P loans with a strong community focus to ensure a truly social experience for both borrowers and lenders rather than just being a transactional online loan tool.

Article Source:
http://www.articlecity.com/articles/business_and_finance/article_8957.shtml