Selling William Beaver with master leases
June 23, 2009 03:50PM
Units with master leases are available at William Beaver House (left), marketed by Rodrigo Nino (right)
As developers in places like New York and Miami look for ways to sell off condo inventory, some are turning to guaranteed income assets, also called master leases. Broker Rodrigo Nino, founder of Prodigy Network, has started using these leases, in which the developer leases out or promises to lease a condo, puts up to three years worth of rent in an escrow account, and then sells the property to an investor, who is guaranteed rental income at least until the money in the escrow account runs out. Nino is using this method to sell units in William Beaver House, at 15 William Street at Beaver Street.
[BusinessWeek]
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Comments
Anonymous
How many units have been sold with master leases? Or, is this just part of the never-ending broker/developer dribble that we've all come to expect from real estate "pros"?
Comment #1 Posted By: Anonymous 06/23/09
Anonymous
Isn't this illegal? Brokers cannot sell investment opportunities like this. I'd love to know what the S.E.C will say about this.
Comment #2 Posted By: Anonymous 06/23/09
Anonymous
This is fascinating. Thank you for writing about it.
Comment #3 Posted By: Anonymous 06/23/09
Anonymous
completely illegal. nino has no authority to offer this as a real estate agent. sec has been notified.
Comment #4 Posted By: Anonymous 06/23/09
Anonymous
they are only offered to international buyers - NOT U.S RESIDENTS. Do you really think he would be telling the media about something so illegal?
Comment #5 Posted By: Anonymous 06/23/09
Anonymous
#5, go back to marketing your unmarketable properties nino rodrigo. you made a living riding the market at it's peak and you will fail like those that have already crumbled.
Comment #6 Posted By: Anonymous 06/23/09
Anonymous
How many have you sold Rodrigo? 0?
Comment #7 Posted By: Anonymous 06/23/09
Anonymous
You folks don't know what you are talking about. They are not being sold as investments. They are simply being leased back by the sponsor for 3 years with the rent put in escrow. Sale-leasebacks are done all over the US legally. Nonetheless, he probably hasn't sold many with this "tool"
Comment #8 Posted By: Anonymous 06/23/09
Anonymous
#7 you are quite bitter; apparently you didn't make any money during the 'good 'ol days' ... nor are you positioned to capitalize on the downturn.
Comment #9 Posted By: Anonymous 06/23/09
Anonymous
Why would the owner put up money for the unit to lease? That doesn't make any sense. If he owned the building why would pay twice for it? I'm confused?!?
Comment #10 Posted By: Anonymous 06/23/09
Anonymous
pretty building!
Comment #11 Posted By: Anonymous 06/24/09
Anonymous
Does this scheme make sense to anyone? According to the data given, an apartment allegedly selling for $1.4 mil is renting for $3,500 a month. If the owner were to receive the entire amount put in escrow, assuming no expenses (ridiculous assumption), the return is 3%. After that you have several risks including trying to keep the apt rented or selling it, as well as maintenance costs. Who would do such a thing?
Comment #12 Posted By: Anonymous 06/24/09
Anonymous
It's a PP discount in the form of a return. You're paying the owner with his own money!
Comment #13 Posted By: Anonymous 06/28/09
Anonymous
a new way to rob people with the Prodigy-Nino seal. !!!
Comment #14 Posted By: Anonymous 08/07/09