Scott O'Neill

The different leases on properties will add value.

For example, a lease for a medical tenant will be worth more than a no-name lease.

I guess a food-related type business or a fashion shop.

So different types of tenants hold more value.

It's due to the strength of the lease and how predictable the rental income is.

Like a dentist, for instance, highly valued.

If you've got a dentist tenant, they've probably spent a lot of money on a fit-out.

They might have a 10-year lease.

That tenant is not going anywhere, especially because they're not really going to get damaged by the economy ups and downs as other, I guess, discretionary spend-based tenants would be.

So I guess you sometimes got to simplify it and just think, how hard would it be to re-let this property if it's in a great location with a great tenant already in there and it's a prominent position?

Then

probably not going to be as hard as you think but if you're around the corner in a back alley and that thing went vacant that's a very poor retail shop which you know i guess it's just like residential there's a there's blue chip and then there's properties you'd never go near even if you you know got it for half price so it's it's important to think like a tenant as well when you buy

Yeah, exactly.

And that's the great thing about, well, not the great thing, but a convenient thing about COVID is you can see the impact that these crazy times have had on the tenant's ability to pay their rent.

Because as part of due diligence, you should always ask for tenant ledgers or proof of income from your tenants, from the current vendors.

And

If they can show you uninterrupted income that's been perfectly paid for the last two to three years, that's a pretty good assumption to make that they're probably going to do the same thing for you when you're their landlord.

So this is where you can research your way out of all the question marks that you might have when you walk into commercial, like what happens if the tenant's going to fail and all that.

You can almost prove to yourself that won't happen through this type of research, calling the tenants up, finding out how they

you know, what their business plans are.