Page 51 - Trump University Commercial Real Estate 101

Ho w to Read a Market

Putting Your Ear to the Railroad Track: How to Know
the Profit Train Is Coming Before Others Do

The profit train will give you clear signals, if you know what to
listen for.
The first very clear signal will come in the form of job growth. I ’ m

not talking about Don ’ s Donuts hiring two cashiers; I mean that you
must watch for announcements that substantial jobs are moving in.
At one point, Countrywide Mortgage announced that it would
move its headquarters and 9,000 jobs from California to Dallas, Texas.
At about the same time, Fidelity Investments in Boston announced
that it would transfer 1,500 jobs from Boston to Dallas.
When you hear such things about a market, your next step should
be to call the Chamber of Commerce in the lucky market. Ask what
other jobs are coming into the market and what the city is doing to
attract these jobs.
Strong leadership in a city will entice corporations to come into
an area by doing a combination of four things:

1. Tax abatements. The city will give a tax break to a commercial
property owner. At one point, Cleveland offered a 75 - percent
tax abatement for 12 years. In other words, if you renovated a
commercial property in the city, you would not need to pay
75 percent of your taxes for 12 years. Apparently that wasn ’ t

sufficient to attract enough business to Cleveland, so they
increased it to 100 percent for 15 years. That did the trick!
2. Low - interest loans. These entice businesses because their debt

service expenses are reduced.

3. Free money. Dallas is providing $ 73 million in incentive funds
for anyone willing to take part in the redevelopment of the Oak
Cliffs area.
4. Free or very - low - cost land. This gives corporations an

opportunity to move their headquarters or build an auto plant
for costs that are way under the market. San Antonio created a

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