I like this place! I'm hoping someone can tell me, or direct me to a readily accessible source which will help me to understand the difference between how a property (investment) company would treat with their property portfolio as opposed to how the property unit in a large retail company (like the typical fast food brand) would treat their bank of properties. Hoping i can be helped.
Are you asking the different between how someone would manage residential investments to how someone who owned and ran businesses would manage the property ownership of the business?
Your question is a little confusing to me. You need to clarify and give more detail. Examples always help (Eg. How McDonalds manage their property vs how Mum+Pop investors manage their 5 house portfolio)
Ryan McLean
http://CashFlowInvestor.com.au
Positive Cash Flow Properties Are Just a Click AwayRyan McLean | On Property
http://onproperty.com.au
Email MeHi Ryan,
Thanks for your response. What i am trying to understand is how differently a firm like McDonalds would approach the management of the real estate holdings that are occupied by their restaurants vs how a typical property company (that invests directly in real estate for profit) would approach the management of their property (asset) portfolio.
I hope this makes my question clearer. Is it?
It is a complicated question because you are talking about complicated business structures.
The way I understand it is this (could be right or wrong I don’t know):
– When you buy a McDonalds franchise (usually over $1million) you are often responsible for buying the real estate which that franchise is on. But the real estate is owned by McDonalds….not you. I don’t know if McDonalds then lease it back to the franchisee, or if they just keep it and let it sit. But that is how I think they have acquired some of the best real estate in the world.This will be one of my goals, once I have some more cash flow and experience. I want to start businesses and use the business to buy the property that the business is on. Use the business to pay off the property and then sell the business but keep the property. This is one of the methods I am looking at using.
– Someone who is out there purely for investing doesn’t get someone to buy the property for them (like a franchisee). Instead they are responsible for buying and financing the property completely and turning a profit in whatever way the can.
Hope that helps
Ryan McLean
http://CashFlowInvestor.com.au
Positive Cash Flow Properties Are Just a Click AwayRyan McLean | On Property
http://onproperty.com.au
Email MeThanks Ryan. An eye opener!
RE
ryan mclean wrote:It is a complicated question because you are talking about complicated business structures. The way I understand it is this (could be right or wrong I don't know): – When you buy a McDonalds franchise (usually over $1million) you are often responsible for buying the real estate which that franchise is on.Wrong, Micky D buys & develops the site. They are a successful property developer with a tenant who sells a very popular product. That is, they develop the site, sell the franchise, franchisee pays rent, turnover rent, locked into purchasing products through their supply chain etc.
Oh ok, good to know. Thanks for making me aware of that Scott.
It is an interesting way to build up a HUGE real estate portfolio…by using businesses to buy them.
Ryan McLean | On Property
http://onproperty.com.au
Email Me
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