Page 252 - Trump University Commercial Real Estate 101

TRUMP UNIVERSITY COMMERCIAL REAL ESTATE 101

It depends on your original exit strategy for the property and
subsequent events. You may have intended to buy it, fi x several prob-

lems, and flip it for a nice, quick payday.
You might have recognized that the property was low in the mar-
ket cycle, and you needed to hold it for three to fi ve years in order to
capture maximum appreciation.
Then again, you may have wanted to establish a long - term presence
in that market and hold the property for many years. You could be the

type of investor who enjoys healthy cash flow and refinances from time
to time in order to put some of your equity to work elsewhere. You
review your portfolio regularly and sell the lower - performing assets,
thus creating an ever - stronger portfolio.

Always Be Watching Job Growth and Supply

For everyone except perhaps the fi x - and - flip people, it ’ s important to
stay on top of job growth in the market.
Job growth is a great leading indicator. Just as canaries would die
and thus warn miners when it was time to get out, you must watch the
job numbers closely. I ’ m not talking about job layoffs: Instead, when
you notice that growth in jobs is leveling off, it ’ s time to look hard at
the market and make a selling decision. If you actually see declines in
jobs, well, you really need to sit up straight.
How do you get these numbers, by the way? Regularly check in
with the building department and economic development department.
Watch for trends by comparing the numbers with previous reports
you received.
I bought a $10 million property in an emerging market in Alabama
with a group of other investors. It performed very well for the fi rst
year and into the second. The market continued to enjoy strong job
growth — it seemed as though there was a new job announcement every
other day.
Though the market continued to climb, we began to notice
that permits were being pulled for properties of our type within a

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