Ron Lorentsen is a master when it comes to international investors. He’s closed countless deals with a variety of international investors, and it makes up a major portion of his business. Since it sounded a little more specialized to me, I decided to ask Ron more about it.
Here are some things to keep in mind, provided by Ron himself:
1. International Investors don’t usually fit all the boxes for traditional banks
For this reason, they tend to go the private money route. U.S. credit scores, experience, and sourcing of funds are usually lacking with the international buyer—these requirements are relaxed with an asset based private lender (like us!).
2. By working with a private money lender, the investor learns nuances of the US banking industry and establishes a key relationship in the market
Often times, international investors could simply pay all cash for their target investment property.
Here’s an example: a recent international investor worked with us to acquire a commercial property primed for redevelopment into a mid-sized multifamily project. Because they had a strong 50% cash down payment, we were able to close quickly, bringing them time to work with architects and contractors for a construction loan. Not to mention finding a more traditional construction lender was then significantly easier (having established a prior relationship with us).
3. Just like other markets, this one is cyclical
Factors include
- Currency exchange
- Foreign stock market volatility
- Home country controls
The majority of Ron’s business has been helping international investors purchase, refinance, or construct commercial property throughout the Western U.S. However, the overarching theme is that U.S. real estate is a stable, safe haven for investment. Seattle and Bellevue specifically are still undervalued compared to other west coast markets (San Francisco and LA), so activity in the PNW has been robust to say the least!
4. Choose a lending partner whose organization is engineered to be nimble and specialized in non-traditional scenarios
Additionally, one should scrutinize the experience and depth of the lending team:
-Have they closed similar transactions in the subject market?
-Are they approachable, available, and responsive or do they hide behind a static webpage?
Because when a multi-million dollar transaction relies on it, can you really afford anything less?
