You have to admit for the financial services industry, this is a pretty cool name for financial product. But not to worry, this is nothing out of the ordinary. ROBS are not a new instrument that you have to be concerned with. In fact, ROBS or ROB is an acronym for Rollover for Business StartUp Program). It's also known for by it's more common names such as; IRA Rollover and Self Directed 401(k).

The beauty in this is that you are able to use either of these vehicles to invest in the following;

• Existing Business (For re-capitalization)
• Purchase Franchise
• StartUp or Start a Business
• Purchase Existing Business

What makes this very beneficial is that you won't have to worry because you are able to utilize these funds Tax-Deferred and penalty free.

​Most startup businesses rely on the use of lines of credit or start up loans called "micro" lending. But through ROBS these equity injections are not considered loans at all.

Business owners, friends and colleagues can now use this financial advantage to invest or offer capital to partner, grow or sustain an existing business. In the past in order to do this you would inherit a ton of liability and fees associated with adding capital to another business.

Flexibility through diversification. By being able to take control of your retirement you can now pin point the assets or businesses that you would like to invest in. This could be your local small business coffee shop or your grandson's new start up business. You can know back your business and retirement.

You'll be surprised on how many middle age clients that we speak to who want to start a business once they leave corporate America. For many they are captured to leave their money in the rollercoaster of stock options and their ex-employer's holdings. ROB grants the opportunity to go out and bet on yourself. Start that business you always wanted.

You're now given the same ability that you had in investing as a employee to your company just like that of another corporation, franchise or small business.

Like many things in finance, you want to make sure that you have everything structured properly. So here are some key factors to be aware of;

• C Corp - You may want to speak with one of our advisors about forming a C-Corporation. Due to the IRS mandate, rules etc. A C-Corp is the only entity that ROB will work with .
• Planning is always important no matter if it is for life, business or just your retirement. You want to make sure that you establish the type of retirement account that you want to use. Your plan should also have much to do with the business/entity that you want to use for your ROBS.
• This is not a retirement funds distribution, so no taxes or penalties are assessed against you when you use a ROBS.
• ROBS funding can be used for any business expense, including paying your employees.
• ROBS can and are often used in conjunction with other types of funding such as SBA loans, personal savings/cash injection, funding from business partner or other investor in the start up business.
• Rollover funds from a personal retirement account plan to the company 401(k) plan – The transfer of your personal retirement funds to the company retirement plan must be done using funds not through your current employer’s plan (if you are still employed by another company and have not separated from that company). Once you separate from your current employer you can use your retirements funds for a ROBS. Other types of qualified retirement funding options that can be used with a ROBS include standard/traditional IRA, KEOGHS, Thrift Savings Plan (TSP-Military), Annuities, 457, 403b, SEP and Pension Plans.
• The new Corporation 401(k) plan uses funds to purchase stock in the C Corporation – The new retirement plan can now purchase stock in the new C Corporation. Typically the number of shares that are given to the retirement plan are equal to the percentage of the funding the plan is providing for the business.
• Proceeds from the sale of the stock are used to start up a new business or franchise, purchase an existing business or recapitalize a business – The new C Corporation now has access to the funds it needs to launch and the journey of business ownership ensues.

It is without surprise that many of us bid Toys R Us farewell. The retail giant now is in a swift liquidation process as the writing of this article.

The year of 2017 has been the bearer of so many companies that have filed bankruptcy. Here is a condensed list:

• The Limited. ...
• Wet Seal. ...
• Eastern Outfitters. ...
• BCBG Max Azria. ...
• Vanity. ...
• Hhgregg. ...
• RadioShack. ...
• Gordmans.

You can see a full list of this from the CNBC Financial Segment.

If you look closely there is a trend to majority of these "Fortune 500" companies going bankrupt. Most retail giants have great store fronts that are apart of their of the business model. This business model highly revolves on the ability and habit of the customer. These customers have a great interest in visiting a store to feel, touch and try various products before purchasing. 

The number one lesson that any business owner can learn from Toys R Us.

https://anchor.fm/lee-chandler/episodes/Toys-R-Us---1-Lesson-for-any-Business-Owner-e16l6m/a-a2nhdc

Because of this business model many people believe that these retail giants are falling. But this is not the primary reason of their downfall. In fact, the biggest catalyst of their downfall is that of their operating expenses. For many retail giants they are the anchor tenants in various shopping malls and centers. 

A large retail giant with supurb credit as a retail renter consist of; 
- Starbucks
- AT&T
- Verizon etc.

Operating expenses is what is needed for every business to operate. The average fortune 500 company has the following view of operating expenses from Toys R Us.

As you can see the rent liabilities have crippled Toys R Us and many retailers because they lose the ability to scale small when needed for tough times. How can we learn from this? It's important that if you plan to grow a brick and mortar business to do one of the following:
​
1. Purchase your office location do not lease.
2. If you must lease, then you should agree to a short term lease. A short term lease may be a higher monthly rate, however it will allow you to have a definite exit without the need of bankruptcy.

Fannie Mae recently closed on a controversial $1 billion loan with the Blackstone subsidiary Invitation Homes. It likely won’t be the last time one of the government-sponsored enterprises (GSEs) bankrolls a loan to a major Wall Street player in the single-family rental market, analysts say. 


The Invitation Homes loan has drawn controversy for several reasons. Fannie has previously only done loans in the single-family rental market involving 10 properties or fewer, and typically with small investors. Invitation Homes is one of the nation’s largest landlords, and is owned by a multinational private-equity firm, the Blackstone Group. 


The loan, which was originated by Wells Fargo, covers more than 7,000 homes scattered around the country. These are properties that were bought at rock-bottom prices during the foreclosure crisis. The deal, which received a lot of negative press coverage when it first became widely known in January, closed on April 28. 


Invitation Homes will use the proceeds to refinance a portion of its preexisting debt. By lowering its debt costs through Fannie’s guarantee and the ultimate backing of U.S. taxpayers, the company can potentially earn more profit from the properties. There is nothing in this deal that requires Invitation Homes to lower the rents charged on any of the properties. 


Another controversial aspect of this deal is that the rentals tend to be located in more affluent areas than Fannie’s typical single-family rental deals. On most previous GSE deals with investors in single-family rental properties, the rents on the majority of properties were affordable to people earning 100 percent of the median income in that area. In the Invitation Homes deal, the median monthly rent for the properties was $1,470, the Urban Institute estimated in a recent analysis of the deal. Just 67 percent of the 7,204 properties would be affordable to people earning the median wage, according to that study. 


Fannie Mae executives say the Invitation Homes deal is a test case. Larger investors entered the market for single-family rentals only recently in 2011. Single-family rentals are also a growing part of the overall rental market. The share of single-family rentals has risen to 57 percent, up from 51 percent in 2005, according to the Urban Institute study. 


“This market traditionally has been very fragmented, made up of mostly mom-and-pop investors,” Fannie Mae Chief Executive Officer Tim Mayopoulos said this month during his first-quarter earnings call with the media. “And here was an opportunity to work with a large and sophisticated investor in this space because we really want to learn more about how we could, you know – what the opportunities were to better support the market.” 


Push back from Realtors


Realtors hate this deal, however. The powerful real estate lobby, the National Association of Realtors (NAR), says it makes no sense from a public policy standpoint. During a time when home inventories are extremely tight, NAR says Fannie has infused $1 billion into the market to subsidize Blackstone’s rental profits. 


“Realtors have no issue with institutional investors making moves in the single-family market,” said NAR President William Brown in a prepared statement for Scotsman Guide News. “What’s more perplexing to us is Fannie Mae’s support.”


Brown questioned why Wall Street investors need a break on their financing, when it is homebuyers who could benefit from lower loan costs. “Instead of helping big investors compete with average consumers and taking inventory off the market in the process, the GSEs should maintain their focus on broadening access to credit by lowering fees and helping prospective buyers become homeowners,” Brown said. 


In a brief published this month, however, the Urban Institute said it was appropriate for Fannie to test the market. Other institutional investors that bought up distressed properties during the downturn will likely try to refinance to increase their targeted yields, said Karan Kaul, a research associate with the Urban Institute. Kaul noted that it will be harder for investors in rental properties to earn yields in the single-family market. Increasingly these companies will look to boost their profits through leverage. 


“Regardless of the missteps that the financial sector and Wall Street engaged in during the crisis, these guys came in and they bought these properties at a time when house prices were in a free fall,” Kaul said. “They took a risk and they have been rewarded handsomely for that, and now they own these properties and, as an industry, are just trying to create a viable, long-term business in this market.”


Despite snapping up 300,000 homes during the last downturn, institutional Investors still only control around 1.7 percent of the entire single-family rental market, Kaul said. Fannie and Freddie could potentially have more impact through deals with mid-sized private investors that have fewer financing options. 
Fannie is guaranteeing 95 percent of the loan. Ultimately taxpayers will be on the hook should it fail. Regarding loan risk, however, the underwriting was conservative, and there was more than sufficient rental revenues and value in the properties to support the debt, according to the Urban Institute analysis. Fannie has also transferred a portion of the risk. 


Apart from purely business considerations, Kaul said GSE deals with large Wall Street investors, as well as mid-sized investors, can make sense from a public-policy standpoint, if the financing subsidy helps address rental shortages and control rent costs. Kaul said that if Fannie and Freddie plan to do more of these deals, guidelines are needed to ensure a percentage of the rentals remain affordable. 


“That is what we think needs to be straightened out moving forward, and the policy focus ought to be not whether this kind of financing should exist or not,” Kaul said. “It is how we make sure the benefits of this financing flow to the renters.” 

This article is written by: Rob Diodato
Rob Diodato is the president of York Commercial Finance, a commercial mortgage advisory company with offices in Dallas and New York. Diodato arranges financing for commercial real estate transactions nationwide for all property types and is an expert in Small Business Administration 504 and 7(a) loans. Diodato has more than 26 years of experience in the commercial and residential mortgage industries.

The multifamily real estate market has been on the rise in recent years. Real estate research company CoStar Group, for example, reported that loan originations increased by 26 percent year over year this past third quarter. Will that growth continue in 2017?

Commercial real estate brokers should be aware of two factors that are likely to have a major impact on the multifamily market in the year ahead: interest rates and deregulation. Rising rates could potentially slow multifamily loan-origination growth to a snail’s pace, compared with recent years. President Donald Trump’s move to pare down financial regulations, however, could have the opposite effect, at least in the short term.

Just like all sectors of the market, the multifamily real estate landscape is rapidly changing in the wake of rising interest rates and the election of a new pro-deregulation president. The combination of those factors could have a significant impact for mortgage brokers serving the multifamily real estate industry.

The Federal Reserve raised short-term interest rates for the second time in a decade in December 2016, and it again boosted rates this past March — for a total bump of a half percentage point, raising the federal-funds target rate to a range of 0.75 percent to 1 percent. While the recent increases were relatively slight, they are only the beginning of what is expected to be a continuing upward push on rates. This is underscored by Fed officials predicting rates will rise two more times this year.

Trump spoke out in favor of raising rates during his presidential campaign, contending a rate bump would pop a “big, fat, ugly bubble.” As demonstrated by his recent executive order aimed at scaling back regulations enacted as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, he intends to keep his campaign promises.

Currently, the multifamily market remains strong. In fact, the Association of Foreign Investors in Real Estate said multifamily assets represent one of the most sought-after investments. This presents an opportunity for mortgage brokers already in the multifamily real estate sector and also for those looking to expand into an area with a large potential for growth.

With that in mind, there are some major changes in store for multifamily real estate lending that brokers should be watching for in the coming months and years. In the face of those changes, and as rates rise and regulations are stripped away, new opportunities for brokers also are emerging, especially in the nonbank lending arena.

Unpredictability
There is evidence to suggest that lending in the multifamily market may slow down. When it becomes more expensive to borrow money, as it does when rates rise, then multifamily real estate projects have a more difficult time making the internal rate of return necessary to secure deals. That means fewer deals happen, unless lenders and mortgage brokers work together to think outside of the box.

At the same time, there is evidence that lending may speed up as a result of executive-branch regulatory overhauls. Experts are predicting Trump will deregulate banks enough to make it attractive for them to increase lending. Trump announced plans this past February for “cutting a lot out of Dodd-Frank,” to make it easier for businesses to borrow money. With fewer barriers, banks may originate more loans and take advantage of the potential to enjoy higher spreads afforded by rising rates.

To cover all of their bases, mortgage brokers may want to consider widening the financing options they typically recommend to clients to include more nonbank lenders. As rates rise, additional means of securing financing may become necessary for multifamily real estate investors.

Decreasing leverage
While the short-term possibility exists that banks will increase lending in the advent of Trump΄s new deregulatory policies, his unpredictability and isolationist stance on trade — as well as his immigration policies — are making many people nervous about what the future holds for the global economy, which ultimately affects markets on the home front.

“ There are some major changes in store for multifamily real estate lending. ”

Rising rates alone can result in financial institutions lending less because the cost of lending goes up. Any sharp stock market drop prompted by investor uncertainty in the strength of the nation’s economy would amplify this effect. Either of these potential circumstances, or a combination of the two, could lead to a reduction in the volume of multifamily real estate investment deals that get off the ground.

To better illustrate the point, here’s an example: If investors typically received around 80 percent leverage on a project and, as a result of rising interest rates and stock market uncertainty, banks choose to lower the amount of leverage they will offer to 60 percent, it creates a 20 percent financing gap. That gap has to be covered if the project is to move forward. If the stock market also is in turmoil, the amount of capital available from equity investors to cover the gap also is diminished.

For mortgage brokers comfortable with a second position in such a deal, however, that 20 percent financing gap represents an opportunity to help clients get creative with their capital stack. That means having access to alternative sources of financing is key.

Bridging the gapGiven the chance, nonbank lenders will make up the difference on underfunded projects. Private lenders or private equity structures are a natural next step for securing the extra funding necessary to make multifamily real estate transactions happen. They offer several advantages over traditional financing, including:

• Lending requirements that are less rigid and can be negotiated between two parties;
• Funding that can be secured faster than via traditional banks; and
• Typically, lower fees and closing costs for clients.

​The cons, of course, include the fact that nonbanks often extend loans that have higher interest rates than banks offer, and the loan terms are usually shorter than what banks offer. Still, when a deal is on the table and a lack of funding is the only thing in the way of moving it across the finish line, higher interest rates and shorter terms are a price many multifamily real estate investors are more than willing to pay.
•  •  • 
With the inevitable changes on the horizon because of rising interest rates and a new president in the White House, commercial mortgage brokers would be wise to consider steering borrowers who are seeking multifamily financing toward nonbank lenders — in addition to pursuing traditional bank loans. Now is the time to reach out and solidify existing relationships with private lenders and to establish new connections.
Mortgage brokers should always be prepared, especially when the market moves. By keeping an eye on emerging trends and shifting your strategies based on these insights, you will have the advantage early in the game — before the market changes the rules.

This article is written by: Yuen Yung
​Yuen Yung is chief executive officer of Casoro Capital, a private equity company that creates discretionary funds for investing in multifamily properties and developments. With Yuen at the helm of Casoro Capital and in partnership with The PPA Group, the companies have achieved more than $600 million in multifamily transactions. Yuen earned a bachelor's degree in business administration from the McCombs School of Business at The University of Texas at Austin.

There are only three real objects when it comes to commercial finance and real estate. Commercial real estate is a more sophisticated matrix for wealth creation in this country. What this means is that the common exit strategies are either to sale via a trade or to refinance. There is no other exit strategy.

In reference to performing a mode of action you are given three strategy options:

1. Asset Trades or Asset Arbitrage is what is disclosed in the industry among professionals.
2. Capital Placement
3. Capital Formation

The most skilled professionals pride themselves on Capital Placement and Formation. You may of noticed that throughout the last few years lending has tightened increased the amount of equity that is needed for a traditional institution to fund a deal.

Although this is common in a lower market this gives others the ability to leverage this intellectual capital. The rave in 2010 became syndication. During 2009-2010 Warren Buffet paid frequent trips to Washington DC to have series of questions in reference to this very thing. By 2015 the process of Syndication has become less regulated allowing a slew of investors and speculators to aimlessly exchange or trade their hard earned money for potential earnings via equity.

What most are uneducated about is that equity is not all that it cracks up to be. Equity is the opportunity to obtain the highest gain, while not truly securing your investment.

Asset Arbitrage is typically performed is something is being traded at a low basis point for its existing market. This creates a win-win situation for both the operator and seller. 2017 is expected to have higher amounts for exit strategy meaning that value will be stiffed at lower returns due to others exiting on the height of the bell curve.

Capital Placement is the process of placing the proper debt on a property that will perform well especially if stabilized. With rates expecting to increase it is important to place capital on the proper groups of assets.

Capital Formation is also know as the debt stack this can often refer to having the capital organized in a way where either the institution, lenders, investors, equity partners and sponsor has priority or is protected.

If you are a web developer or a marketer looking for a great opportunity, look into joint ventures. Keywords: business


If you are a web developer or a marketer looking for a great opportunity, look into joint ventures. Joint ventures are a great way to combine talents and create a winning product. Many people who have been successful at joint ventures came to the plate with one strong talent, whether a winning product or a great network to sell products. By combining your forces, you can create synergy and a healthy profit. Here are some tips on joining joint ventures.

Joint ventures are very easy to create. There are plenty of web sites that offer people the opportunity to post their business propositions online for other to see and consider. Many developers and marketers check out JV opportunities weekly looking for the next big product. For instance, many web developers use affiliate sites to sell quality products to the masses that offer huge commissions. Affiliate sites such as Clickbank, Commission Junction and even Amazon help small web developers sell their merchant’s items. You can also look at web forums for vendors or marketers that are looking to team up and make a healthy profit. So if you only have one piece of the puzzle, but still want to be successful, look into joint ventures and create a relationship that will benefit both parties involved.

Build Up Your Business Credit It is very important to build up your business credit scores to be able to avail of financial loans to fund your small business. In truth, small enterprises are now clamoring about for loans to improve their business by using the money for improvements, or purchasing inventory to meet consumer demands. Building up your business credit takes a lot time and effort, and requires a paper works by the dozen. Here are some tips on how to get started in giving your business credit rating a healthy boost: Set a business identity first The first step in improving your business credit is to get one in the first place. This can be done by registering your business as an LLC or a corporation. Next you need to provide all the necessary paper works required by lenders such as legal document like business permits and licenses, financial statements, references, contracts, and so on. You need to keep in mind that when you register your business as an independent entity, you need to have a fixed address of your business, as well as open lines of communication. (Note that P.O. Box is not acceptable as a business address) You might also need to register your business in a credit agency so they can keep tabs on your credit ratings and scores.

These organizations will act as reference when you apply for a financial loan that requires a valid credit report. Building up your credit status will depend on the financial stability of your business as based on the financial documents during its operation. Also, prompt payments are a major issue when it comes to raising your credit status. Fail to pay on the date agreed; you get a negative score on your credit score if that happens. You might also need to keep monitor credit card reports when they are delivered to you. Try to check for transactions that you did, or did not, make. If you spot an error, report it immediately to the corresponding agency. This will result to a higher credit rating. Get a loan Before you can actually improve your credit scores, you need to have a credit to work with. Many small businesses are now opting for business credit cards to improve their ratings. One reason for this is that these plastics have reduced interest rates and APR, which is quite useful for making prompt and affordable payments. Also, since business credit cards have no principal amounts attached to them, you can easily control the interest expense you make every month. You can do some budget planning to minimize expenses and maximizing profit, without worrying about interests piling up. Another way to improve your credit status is through credit lines. Many financial institutions, like banks, are now offering short-term lines of credits (LOC) for small businesses, with easy payment terms.

​Since interest expense on LOC is dependent on the principal amount, you can easily reduce it by paying the original debt until you reach zero. With this term in mind, you can easily make prompt payments according to the agreement between you and the lender. The gist to build up your business credit is to make prompt payments on your debts. Whether you have multiple loans or tons of credit cards at your disposal, you need to make sure that you pay each one on its designated date. If done right, you are well on your way to improve your credit scores, which in turn, will improve the financial future of your business.

Need to create a pool of quality clients? Try these five easy steps. 

So, it is that time. You are a working designer who has built a solid portfolio. You are as experienced generating concepts as you are comfortable sending them to print. You have carefully weighed your options and are finally ready to begin working for yourself. Congratulations! Now what do you do? Assuming you are equipped to handle the administrative functions of trekking out on your own (which is another article in itself), the next step is to begin building a client base. However, if you want to be successful in this highly competitive profession, you must not only build a client base, but you must build a solid client base. To help you on your way, I have complied five tips for building and improving your client base that I have found useful in my own work:

1. Form Partnerships with Other Vendors: When I was first getting started, my company was able to secure a contract with four major print centers which referred all of their clients who needed graphic design and typesetting work to us. In turn, we would complete the project and send the job back to the center to be printed. Not only did this provide us with a steady workflow, but we also established valuable relationships with new clients who would trust us with work in the future. I highly recommend forming relationships with other vendors. Print shops often need designers who can provide them with print-ready files, small marketing and public relations firms often need a reliable designer they can send work to, and many designers get overloaded with work and would love to pass some on to others in need of it. Get out there, make friends, build relationships and you will find good work.

2. Network, Network, Network! As you grow your list of contacts, you will find that something good starts to happen; you will gain momentum. When you build relationships you will find that the best way to gain new clients is through your established ones. Be clear to all of your clients about the services you offer and they will remember you the next time they hear of someone with a need you can fulfill.

3. Charge What You Are Worth. This is one of the most difficult things for a designer when they first begin to freelance. Inevitably, the temptation to discount your work will always come. The most frequent phone call I get is one where the prospective client needs something “simple” but really means “cheap.” Resist temptation. While there are times when these phone calls can lead to valuable client relationships, the majority will often lead to more calls asking for discounted work. Run the numbers beforehand. Establish your pricing and be clear about it with your clients. If you find that you absolutely must accept discounted offers, clearly represent how much you would normally charge and mark the discounts on the final invoice. This way, your clients will at least know what you would usually charge when they recommend you to others.

4. Learn How to Say No. Learning how to decline projects is an integral part of working on your own. Bad projects eat your time, create frustration, and cost you money. Establish your criteria for accepting a project and stick to it. You are much better off seeking and planning for the right job, than you are accepting the wrong one. Accepting only the good jobs will help you network with the right kind of clients and produce better work for you in the future.

​5. Stay Focused. Focus! Focus! Focus! This is more of a tip for internal use than it is to outwardly seek clients. However, it is the most important advice I can give. So many projects remain incomplete because designers lose focus and turn their attention elsewhere. Whatever your goals are, write them down, create a plan, and stay focused on achieving them. Designers who run a tight ship are almost always the ones who achieve success in this industry.

If you haven't realized already there are multiple Booms throughout the United States in various markets. Currently one of the markets that our base focuses on is the Indiana and greater Indianapolis Markets. 

Within the greater Indianapolis market is a submarket north west called Boone County.

Although with slow beginnings the area has become a quite and niche hot bed. Here are the economics behind its boom.

1. Strengthened Demand for Senior Living
2. Development boom to meet the predetermined supply/demand
3. Decrease in residential public inventory and increase in private inventory
4. Residential spur of price demand at 11.6%
5. Residential final sales price of 10.2%+

Single family inventory has decreased almost 10%from last year while both closing and original asking prices are almost identical. This means that the average listing is going for exactly what they're asking for. This means that the Seller is in control. This gives a key indicator that the current market in Boone County is heading to a peak in their Boom.

What started this Boom in Boone?
The answer is multifamily señor living (2016):

• Stokes Common: (68 units) 
  1005 S. Meridian Street Lebanon, IN 46052 
  
  ​
  

Cities consist of;

• Zionsville
• Whitestown
• Ulen
• Thorntown
• Lebanon
• Jamestown 
• Advance

What the new development has contributed to is the development of Residential Homes to couple to senior population and the expansion of a Walmart in Zionsville.

The full combination with the Economic Impact creates a Boom in Boone County. How long will the Boom last? 
Typically a healthy Boom consist of 10 consecutive years, with the average lasting 3-4.