Got a call today from a guy who inherited control of a screwed up apartment building. I have a lot of sympathy for people in that situation, since it happened to my family back east.
The dilemma is this: You know you have an asset which is not performing. You know that it will cost a lot of money and (more importantly) time to untangle all of the problems and get it performing again. You want to sell, but you know you’re not going to get a full price, because the building is screwed-up.
The temptation in this situation is to try to hire someone to fix the problem for you. And, of course, there are plenty of people and management companies out there who will listen to your problems and tell you they have the answer if you just pay them a few thousand dollars.
Don’t hire one of these charlatans. Remember: People who know how to do this stuff (like me) make a lot of money sorting out troubled buildings. Why on earth would we do it for a few thousand dollars?
No one will care enough about a few thousand dollars to do the hard work necessary to clean your building up. They will instead be happy to take your money for a while and not deliver any results. That’s what happened to my family and to this guy I spoke with today.
Instead of hiring a charlatan, choose from one of these two options:
- Commit to sorting out the building yourself. This is painful and risky. It will require more of your time than you can imagine. You will spend a lot of money. However, the payoff could be sweet.
- Sell the building. You won’t get top dollar for it. But you will not go through the pain and heartache that comes from doing one of these projects.
That’s it. Do it for yourself or sell to someone else who will do it for himself.