Calling all flipsters: How to keep your flip from becoming a flop

Calling all flipsters: How to keep your flip from becoming a flop

Many young professionals are becoming real estate investors by devoting their time and money into flipping properties, hoping to sell them to other young professionals. The Los Angeles Times has even coined a new term for these young professional home flippers: “flipsters.”

So, let’s assume that you, a flipster, have done your due diligence and found that ideal fixer upper in that picture-perfect neighborhood. Your bid has knocked out the competition, and now you’re ready to tear down walls and install those French doors (Joanna Gaines, anyone?). So, what are some things you can do to help align the real estate profit gods in your flipster favor?

Permits

I’m sure it’s no surprise to most, but flips, whether residential or commercial, require substantial work in terms of rehab. But before you go swinging that hammer, make sure you’ve checked in with your local building department to determine which permits are necessary for your project. Yes, most localities do require permits for residential projects. You may need a permit to install that new white picket fence or for any changes to electrical, plumbing, HVAC, or mechanical systems.

Even if you hire skilled contractors, be clear who is responsible for obtaining the permits. Check with your local building department to determine who is ultimately responsible for procuring the permits. Some localities require the owner to apply, while others will only work with contractors who are certified to perform work in that locality. Keep this in mind when you’re picking a contractor.

Any time you’re taking on a project, expect that you will have to pass an inspection by your local building official. Trying to hide work or thinking you can get away without getting the required permits is a mistake. If work is done without a permit, the building department can put a hold on any occupancy or rental permits, charge a 300% markup on permit fees, or even require that the unpermitted work be removed. Setbacks such as these can be the difference between a successful flip and a flop.

Construction contracts

While it can be tempting to have your brother’s friend’s uncle work the rehab job on a handshake deal, entering into any type of construction project without a written contract can be a recipe for disaster. Construction contracts are vital to keeping the project on schedule, on budget, and to hedge some of your risks. Construction contracts may seem like an easy item to skip over, but if your contractor leaves you high and dry with half a flip to go, you’ll be glad you protected your interests, in writing.

A construction contract can save you from every flipster’s nightmare: a contractor taking your hard earned money and skipping out on the project. Your construction contract can save you by scheduling payments that coincide with the progress of the project. For example, your contractor will get 10% to start, then when the project is 30% complete, they get another 20% payment, and so on. Your construction contract can also require retainage. Retainage is when a percentage of the total project price is retained by the owner until the project is 100% complete to the owner’s standards. This can help deter a contractor from rushing through the project, taking the full payment, and then never returning your calls about that shoddy paint job that needs touched up.

In sum, flipsters can take these simple steps to help ensure they have the best chances at a successful flip and to avoid a flop. Research your locality and understand what permits must be acquired before you start the work and get a construction contract in writing to protect your interests. Once you have these items completed, you’ll be well on your way to a successful flip.

Happy flipping, flipsters!

Tara J. Rose is an associate real estate and construction attorney with Buckingham, Doolittle & Burroughs in Akron.

(Why?)

Published at Fri, 18 Aug 2017 09:00:00 +0000

Doing business in Chicago | Entrepreneurs Roundtable

Doing business in Chicago | Entrepreneurs Roundtable

Does City Hall make running a small business in Chicago more difficult than it should be? Our panel lets off some steam—and points out whats good about doing business in the city. The group includes: Eric Fosse of HomeMade Pizza Co., Darren Guccione of Callpod, Edmund Scanlan of Total Attorneys and Gabriel Magliaro of Half Acre Beer Co., which hosted our roundtable—and provided the beverages.

Merck CEO quits Trump council, prompting drug-price tweet from the president

Merck CEO quits Trump council, prompting drug-price tweet from the president


By BLOOMBERG

Merck & Co.’s CEO quit President Donald Trump’s council of manufacturing executives on Monday, Aug. 14, saying “America’s leaders must honor our fundamental values” by rejecting expressions of hatred, bigotry and group supremacy.

He was almost immediately attacked by Trump on Twitter.

Following a weekend of violence in Virginia involving white-supremacist groups that Trump has been criticized for not explicitly condemning, Merck CEO Ken Frazier said “as a matter of personal conscience, I feel a responsibility to take a stand against intolerance and extremism.”

Less than an hour later, Trump tweeted in response, “Now that Ken Frazier of Merck Pharma has resigned from President’s Manufacturing Council, he will have more time to LOWER RIPOFF DRUG PRICES!”

The council has included top executives from Boeing Co., Dow Chemical Co. and Johnson & Johnson. The move by Frazier — the latest CEO to quit the groups — comes after a weekend of violent clashes in Charlottesville, Virginia, that resulted in one death.

Trump, over the weekend, said “many sides” bore blame for the violence, though has so far not directly criticized the supremacist groups that were protesting the removal of a statue of the confederate war general Robert E. Lee. On Saturday, Aug. 12, a man drove a Dodge Challenger into a group of counter-demonstrators, killing a woman.

Social issues

Frazier is a black CEO — a rarity in large American corporations — and Merck has in the past taken stands on social issues. In 2012, the Kenilworth, N.J.-based company’s foundation ended funding for the Boy Scouts of America over the group’s exclusion of gays from its leadership ranks. Frazier is a registered Democrat, according to Pennsylvania voter records.

Trump created two CEO advisory groups early in his presidency. Blackstone Group CEO Steve Schwarzman leads one described as a strategy and policy forum, and Dow Chemical Co.’s Andrew Liveris organized a manufacturing initiative. After an initial burst of activity and press attention, the councils have fizzled with neither meeting since April.

Other chief executives have also stepped down from the various business-advisory groups. Earlier this year, Elon Musk of Tesla Inc. and Walt Disney Co. CEO Bob Iger quit the strategy and policy panel after Trump withdrew from the Paris climate pact. Former Uber Technologies Inc. CEO Travis Kalanick quit in February after Trump’s executive order on immigration.

Toby Cosgrove, the CEO of the Cleveland Clinic, plans to remain on the strategy and policy group, said to Eileen Sheil, a spokeswoman for the health system. She said the group hasn’t met since April, and there are no meetings scheduled.

Goldman Sachs Group Inc. CEO Lloyd Blankfein also took to Twitter Monday in response to the violence, citing former president Abraham Lincoln. “A house divided against itself cannot stand,” wrote Blankfein, whose inaugural tweet in June expressed disapproval over Trump’s decision to ditch the Paris climate accord.

Trump made U.S. drug prices an issue during the presidential campaign and after — at one point accusing drug companies of “getting away with murder.” While his rhetoric on the subject has cooled, the Food and Drug Administration has taken steps to try and bring more competition to the market for some drugs, and speed more generic drugs to the market.

Merck’s prices

Trump made U.S. drug prices an issue during the presidential campaign and after — at one point accusing drug companies of “getting away with murder.” While his rhetoric on the subject has cooled, the Food and Drug Administration has taken steps to try and bring more competition to the market for some drugs, and speed more generic drugs to the market.

Frazier, in December, said his company has a “ restrained” approach to price increases, calling aggressive price increases a foolhardy move by the industry. In a company report published this year, Merck said it has a “long history of making our medicines and vaccines accessible and affordable through responsible pricing practices.”

For 2016, the list price on its drugs rose by 9.6% on average while the net price, which more closely reflects what is paid by consumers, rose 5.5%, according to the report.

Merck shares were up 0.7% to $62.84 at 9:42 a.m. in New York.

(Why?)

Published at Mon, 14 Aug 2017 14:29:19 +0000

Chicago Booth: Possibility, Opportunity, and Inquiry

Chicago Booth: Possibility, Opportunity, and Inquiry

Watch as students discuss the flexibility of the master’s degree as well as the incredible student community and support network at Chicago Booth. There are faculty who encourage an environment of inspiring thought and help students to ask the right questions; an alumni network and career services support system that allows students to take risks and pursue their passions; and a community of students who are committed to helping each other grow.

To hear individual student stories about Booth and its community and opportunities, check out our Student Viewbook at http://chibooth.biz/1fnhsKH

Local tech startup steps on the gas

Local tech startup steps on the gas

Sarah Grant always loved the open road but was never too high on staying in hotels, so the idea of purchasing an RV had obvious appeal

“If you can’t travel the world, you should at least have a good grasp of the lower 48,” said Grant, whose family typically travels each year by car from their home in Fostoria, Ohio, to Texas.

However, the prospect of a piece of equipment costing $50,000 or more sitting in her driveway for 10 or 11 months a year wasn’t ideal. That was until RVShare, a local startup, helped turned her apartment-on-wheels — a 2010 Fleetwood Quest, to be exact — into a revenue generator for her family. So far this vacation season, “The Quest,” as the family calls it, only sits in their driveway for two or three-day stretches at a time and the earned revenue more than covers the debt service on their RV.

Akron-based RVShare is an AirBnB-like platform that allows RV owners to rent out their vehicles when they aren’t using them. For making the connection and providing some of the back-end work — insurance, most importantly — RVShare takes a cut of the rental fee, which usually starts at about 15%.

“Our mission statement is not on our website because it wouldn’t make sense to the front-end consumer,” said RVShare co-founder and CEO Joel Clark. “We create entrepreneurs. We fell in love early on with helping the middle-American family.”

Admittedly, Clark said, the RV rental business seems like an odd niche, but there was clearly a market need. For one, people had been pedaling RV rentals on Craigslist for years, lacking access to much of the back-end technology that he believes makes RVShare so valuable. Also, many RV dealerships or mom-and-pop shops who rent vehicles only do so during certain times of the year.

The impetus for the company was RVShare co-founder Mark Jenney, who had bought an RV to travel the country as part of his honeymoon. Afterward, he realized he had no use for the vehicle and longed for a way to make money off the investment. Enter Clark, who offered to build a rudimentary template. It immediately started getting hits.

“The average RV sits unused for 50 weeks a year,” Clark said. “When insurance companies rate the risk, they’re rating the risk on only two usage weeks per year. That’s crazy. You’ve got 10 million families for 50 weeks a year that pretty much have a money pit in the driveway they don’t have time to use. It’s almost a second mortgage.”

And so far, the business model seems to be working. Without providing exact figures, Clark said the 4-year-old startup remains self-funded and “fully profitable.” Also, at this point last year, RVShare had about 12 employees, but today its workforce hovers around 40 people. Right now, more than 30,000 RVs are listed for rent on the company’s website. According to the company, the average RV owner earns more than $10,000 per year through the service. Some reported earning $30,000. Listings also are free.

“Our greatest challenge is finding the right people to add to our team fast enough,” Clark said. “We’re very much a puppy growing into its paws.”

The so-called “sharing economy” is hardly a novel concept — just look at the success of companies like Lyft, Uber and AirBnB. The idea behind it being sharing underused assets or services, usually for a fee, on a peer-to-peer basis.

However, the model, especially for a startup, does present its challenges, Clark said. For one, Clark said RVShare’s first two years were spent trying to develop the marketplace.

“Building a platform doesn’t necessarily mean users would immediately flock to it,” he said.

“Marketplaces are a simple idea, but they also present some very unique problems,” Clark said. “Starting a marketplace from scratch is a chicken-and-egg problem. You’re responsible for one side of the equation or the other. Neither side wants to be first side to the party. We ended up cracking that egg and built this product, and then went out and found people trying to do this but didn’t have a platform.”

RVShare does have its competitors, though Clark said RVShare’s differentiator is that it’s the only marketplace with both liability and comp insurance backed by a rated carrier. Others, he said, self-insure damage and collision. RVShare has an exclusive arrangement with MBA Insurance, which specializes in the RV space.

The sharing economy, meanwhile, is becoming an increasingly larger piece of the overall economy. According to a survey from the Pew Research Center, 72% of American adults have used at least one of 11 different shared and on-demand services mentioned in the survey.

Also, about one in five Americans have used four or more of these services, and 7% have used six or more. Moreover, according to a recent report from the Federal Reserve Bank of Kansas City, current economic data might not yet fully grasp the impact peer-to-peer services, particularly ride-sharing apps, are having on the overall economy.

(Why?)

Published at Sat, 12 Aug 2017 04:01:00 +0000

Adviser: Lessons abound as Tesla speeds toward streaming

Adviser: Lessons abound as Tesla speeds toward streaming

“And the sign says you’ve got to have a membership card to get inside.”

Twenty-seven years ago, the metal band Tesla covered the song “Signs” for its MTV Unplugged album, Five Man Acoustical Jam. This title was a (relatively uncreative) spin on the Five Man Electrical Band, the Canadians who initially penned the lyrics to the album’s fifth track. Fast forward to 2017, and this mildly obscure hair band may have been oddly prophetic. Another Tesla — this time I’m referring to Tesla Motors Inc., the technology company led by a One Man Electrical Brand, Elon Musk — may soon be delivering the same message to competitors like Apple, Amazon and Spotify.

Look out music providers, objects in your mirror may be closer than they appear. Tesla could be speeding into the streaming business.

In late June, Tesla revealed its intent to develop its own proprietary music-streaming service. This unnamed product would come bundled in all Tesla vehicles according to the report from Recode. On the surface, this won’t impact most Americans. After all, Tesla fell short of its sales goal — delivering at least 80,000 vehicles — by the end of 2016. They passed 100,000 cars sold this January.

At first blush, some pundits questioned the investment necessary to design and launch a proprietary music-streaming service for a couple hundred thousand vehicles. It’s hard not to raise an eyebrow when Spotify claimed at least 50 million paying subscribers while Amazon reported 27 million. But, if there’s one thing Musk has proved time and time again, it’s that he isn’t afraid of the long play. And new members of the Tesla family may be easier to obtain in the next few years.

On July 5, Volvo announced that all new cars launched from 2019 onward will be partially or completely battery-powered. In that same story, The Guardian reports that Volvo, “has yet to build a single fully electric car.” The company’s self-imposed deadline is a mere 24 months away.

France followed suit by announcing that it planned to ban all new petrol and diesel cars by 2040. By the end of July, the United Kingdom became the latest European country to announce a similar move, likewise targeting 2040 as the year its gas-car ban will go into effect.

With this rising global demand for electric vehicles, Tesla appears to have a head start in the electric car arms race. That may be exactly why the streaming business is music to Musk’s ears.

Pandora seems to be caught between the net and baseline — a place tennis players refer to as “No Man’s Land.” They burst onto the streaming scene with an ad-supported listening model. Then, to chase Spotify, Pandora introduced Premium, it’s $10-a-month, me-too service, to lukewarm reviews. After a management shakeup, Pandora is reportedly back to the drawing board to figure out how to make the ad-supported model work.

Spotify is clearly the streaming leader. But its financial health is directly correlated to its ability to negotiate better music royalty rates. Unlike Apple or Amazon, there are no other business units that can subsidize these premiums.

Which leads us back to Tesla. If the fledgling auto maker can accelerate its manufacturing to meet this growing demand, its affluent customer base will grow exponentially. The combination of locking its streaming competition out of its vehicles in favor of its proprietary service and growing its base of rabid fans could land a deadly body blow to Apple, Amazon, Pandora and Spotify.

In a recent Business Insider interview, a Tesla spokesperson said, “Our goal is to simply achieve maximum happiness for our customers.”

On the surface, this may sound like a squishy platitude from a seasoned PR veteran. But I believe that remark was delivered in earnest. I believe it because since it burst onto the scene in 2003, Tesla has proven that it isn’t just a car company. It is a technology company. And often, technology companies forget the real purpose of technological advancement: to make our lives more enjoyable.

Technology should make the complex simple. It should help connect us with people more effectively. It should give us new ways to share ideas and express creativity. Ultimately, the role of technology is to help us reach a different level of happiness. Perhaps, a level that we didn’t couldn’t collectively conceive five years prior.

When it comes to technological advancement, Tesla is clearly in the driver’s seat. The lesson for other technology companies is that Tesla got there by thinking outside of its car.

(Why?)

Published at Sat, 12 Aug 2017 04:01:00 +0000

Top 10 things to do in Chicago, USA. Visit Chicago

Top 10 things to do in Chicago, USA. Visit Chicago

Top 10 Chicago. Places to visit in Chicago. Things to do in Chicago.
My list of top 10 attraction to see in Chicago (The windy city).
10. Navy Pier
9. Shedd Aquarium
8. Museums
7. Buckingham Fountain
6. Crown Fountain check out the video – https://www.youtube.com/watch?v=YC9fPRiZU-k
5. The Loop
4. Millennium Park
3. Boat Ride
2. Cloud Gate
1. Willis Tower & sky deck

Please let me know your views and suggestion.

Visit Chicago, Illinois, U.S.A.: Things to do in Chicago – The Windy City

Visit Chicago, Illinois, U.S.A.: Things to do in Chicago – The Windy City

Visit Chicago – Top 10 Things which can be done in Chicago. What you can visit in Chicago – Most visited touristic attraction of Chicago.

Top 10 attractions in Chicago.

Tribune Tower
A neo-Gothic building located at 435 North Michigan Avenue. Is the home of the Chicago Tribune, Tribune Media, and Tribune Publishing. Was completed in 1925 and reached a height of 462 feet (141 m) above ground.

Buckingham Fountain
One of the largest fountains in the world. Built in a rococo wedding cake style. It is meant to allegorically represent Lake Michigan. Regular water shows and evening color-light shows. During the winter, it is decorated with festival lights.

Adler Planetarium
It is America’s first planetarium. It was opened to the public on May 12, 1930. It was declared a National Historic Landmark in 1987. The Adler’s mission is to inspire exploration and understanding of the Universe.

Grant Park
A large urban park (319 acres or 1.29 km²). The park is often called “Chicago’s front yard”. Contains performance venues, gardens, art work, sporting, and harbor facilities. It hosts public gatherings, and several large annual events.

Lincoln Park Zoo
A free 35-acre (14 ha) zoo. Was founded in 1868, making it one of the oldest zoos in the U.S. One of a few free admission zoos in the U.S. About 1,100 animals from 200 species. Home a burr oak tree which dates to 1830, three years before the city was founded.

Museum of Science and Industry
The largest science museum in the Western Hemispher. Features a full-size replica coal mine, a German submarine (U-505) captured during World War II, a 3,500-square-foot (330 m2) model railroad, the first diesel-powered streamlined stainless-steel passenger train (Pioneer Zephyr), and the Apollo 8 spacecraft that carried the first humans to orbit the Moon.

Willis Tower
Or Sears Tower, is a 108-story, 1,451-foot (442 m) skyscraper. At the time of its completion in 1973, it was the tallest building in the world. One of the most popular tourist destinations, Over one million people visit its observation deck each year.

Shedd Aquarium
An indoor public aquarium that opened on May 30, 1930. Contains over 25,000 fish, 1500 species including fish, marine mammals, birds, snakes, amphibians, and insects. Was the first inland aquarium with a permanent saltwater fish collection.

Millennium Park
A public park originally intended to celebrate the millennium. Planning began in October 1997. Construction in October 1998, and Millennium Park was opened in a ceremony on July 16, 2004, four years behind schedule.

Navy Pier
A 3,300-foot-long (1,010 m) pier. Was built in 1916 at a cost of $4.5 million. one of the most visited attractions in the entire Midwestern United States and is Chicago’s number one tourist attraction.

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Chicago Travel Guide: Things To See, Do & Eat

Chicago Travel Guide: Things To See, Do & Eat

This is your beginner’s guide to Chicago: where to stay, what to see, and all the food unique to the Windy City!
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PLACES VISITED
W Chicago City Center
Millennium Park & Cloud Gate
Art Institute of Chicago
360 Chicago
Chicago Athletic Association
IPO at W Chicago City Center
Skydeck Chicago
Christkindlmarket
Portillo’s
Garrett Popcorn Shops
Navy Pier
Giordano’s
Remedy

Special thanks to Expedia.ca & Choose Chicago

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