Advice Pool - Real Estate

Avoid 12 Common Mistakes Made by Novice Investors and Ensure High Rates of Return!

Real estate investment has provided many investors with positive cash flow, tax benefits and satisfaction of making an impact in others lives. Like any investment however, real

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

estate has intricate nuances and market trends that when ignored can cause an investor tremendous heart ache.

Unbelievably many first time investors are willing to part with their hard earned cash without taking the time to study their investment. They rely

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

n traditional trends and gut feelings. Before you risk your investment take the time to learn all you can about your market. By aligning yourself with the right professional you can avoid these 12 common mistakes and you’ll ensure an excellent return on your i

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

nvestment.

1. Failure to Determine Your Time Need - Cash flow, capital appreciation, tax benefits, loss of management, equity paydown and pride of ownership are just some of the things that need to be addressed before you make that investment. A service minde

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

real estate professional can be a tremendous asset by taking the time to evaluate your needs and making sure you’ve got all your bases covered.

2. Not Checking out the Seller or Sellers Agents Numbers - Claims of extremely high rates of return run rampant in

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

real estate investment. Don’t get caught up in the excitement - check everything: rents, payment history, taxes, expenses, deposits, future modifications... everything. Make sure you have the right agent...it’s like having a good insurance policy against over

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

ooking all the seemingly insignificant but very important details.

3. Forgetting You Are Buying a Business - Owning investment property carries with it a great potential for creating wealth and... some potentially difficult decisions. Evictions, re-investment

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

into the property and time management all need careful consideration. Remember this is not a ‘hands off’ business.

4. Avoid Negative Cash Flow - Property that eats cash every month can drain your working capital. This can create stress, frustration and becom

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

quite painful. Predicting constant appreciation is extremely difficult if not impossible for the unseasoned investor. A strain on your cash flow may cause you to sell the investment before the benefits of ownership are ever realized.

5. Failure to do a Thoro

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

ugh Inspection - Look under every rock! Hire a professional inspector. Ask the tenants about pest problems, structural damage or reoccurring problems. Don’t overlook anything! A value driven real estate professional will help you find the right inspector and c

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

n help you avoid costly mistakes. When investing your hard earned money be sure and use sound business judgment!

6. Failing to Have Adequate Insurance - Investment property brings liability. Tenants, cars, parking lots, cleaning facilities, property liability

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

- the list is quite extensive. Adequate insurance coverage is an absolute must! Be sure to consult with an insurance professional and protect your hard earned assets.

7. Inspect, Approve, and Confirm All Documents - The list of documents that need to be proof

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

ed can be overwhelming to the first time investor. Building permits, zoning laws, rental and lease applications, health licenses, laundry leases, underlying loan documents, CC&R’s, by-laws, title policies, mineral leases, inspection reports, purchase contracts

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

insurance.. don’t attempt to do it alone. The right professional can remove most of the stress and bring the transaction to a conclusion smoothly.

8. Get a Bill of Sale For All Property Involved - Many types of personal property (appliances, furniture, fixtu

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

res, etc.) can be involved in an investment sale. Be very detailed -know who owns what!

9. Charge Fair Rents - Vacancies, turnovers and lease terminators are your biggest expense. Charge fair rents, treat your tenants with respect and respond as quickly as po

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

sible to their needs. It’s a lot less costly in the long run to take care of the little problems before they become big problems. Vacant property is your Achilles heel.

10. Select Qualified, Good Tenants From the Start - Take the time to check references. Pre

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

vious landlords, employers, financial references, credit and judgments are all vitally important. If there are any questions do a thorough investigation. Drive by their previous residence. A little work up front can save tremendous problems later.

11. Make Su

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

e You Get Estoppel Letters - Get letters from tenants confirming the status of tenancy. Make sure their version of the rental or lease agreement corresponds with the sellers interpretation.

12. Don’t Spend Positive Cash Flow - Most of successful investors hav

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

e free and clear properties. Be sure to re-invest your cash flow back into the property payment and speed up the amortization schedule. This decreases your debt load and increases your equity which builds your net worth. Investment property can be one of the

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

most rewarding aspects of your financial portfolio. Be certain to have all your ducks in a row before you invest. Do your homework! Consult with a professional real estate agent and protect yourself from the hidden troubles that can plague first time investors

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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