When it comes to flipping a property to make a profit, Frank Giuffre knows what he’s doing.
Giuffre has been in the commercial real estate business for a while. But he’s never purchased, revamped and sold a property in six months and made $500,000 in the process. That was until this past spring.
“It was a quick turnaround,” he says of the multi-unit warehouse at 5670 Jason Lee Place, Sarasota. Giuffre is the owner of F&H Properties Sarasota LLC, along with his wife Heather. That quick turnaround is based, for the most part, on two factors: the red-hot market, of course, but also Giuffre's strategy of finding gems in the unseen and being nimble to respond to unusual opportunities.
When the company was first incorporated in October 2010, the focus was on flipping commercial buildings for a profit. More specifically, the Giuffre's targeted single-unit properties and condos.
One of the purchases Frank Giuffre made during those days was two 1,017-square-foot office condo units in the Franklin Field Business Center in Sarasota. Giuffre’s company purchased the units for $189,000 in April 2013. The units were sold to Troyode LLC for $269,400 in April 2015, an appreciation of 42.5%,
Now, with sights set on bigger deals and bigger returns, the company’s aim is for multi-tenant buildings featuring six or more units.
F&H properties is the middleman, Giuffre says. It's the liaison between the seller and long-term investors. “We get them to where they need to be,” he says. The Giuffre's oversee the purchase, sale, and tenant selection. The company generally has two to three properties a year they oversee.
F&H properties partners with other entities, such as Sarasota-based Harry E. Robbins Associates Inc. In particular, Giuffre has been working with Troy Robbins, a broker-associate at the commercial real estate firm, for several years. Together, they take a property and get the rent to market value.
“We try to retain the same tenants and fix their space,” Giuffre says. “We just want the rent at market price.”
Typically, there aren't a lot of structural changes involved when a Giuffre-purchased property is being revamped. Instead, the focus is primarily on painting, landscaping, parking and signage. The goal is to make it more presentable and appealing. It's a winning strategy. “It’s more cosmetic,” Giuffre says. “A little paint and some landscaping goes a long way.” Typically, on a quick remodel, Giuffre says he spends up to $50,000 on improvements.
On average, projects take a year to complete. The one at Jason Lee Place, in particular, was by far the fastest Giuffre has ever purchased, renovated and sold a property. For one, Giuffre says the location, just off a heavily-trafficked part of Clark Road, was fantastic. They cleaned it up a bit, raised the rent and added new tenants. “We were able to almost triple the income the old owner was making,” he says.
Giuffre also stays focused on the capitalization rate — the return on an investment. Typically, a long-term investor will look for an 8% cap rate. And that’s exactly what they did with this property. He bought it for $1.05 million Nov. 6, property records show, and by the time Giuffre and Robbins were done with the place, it was resold for $1.55 million. The buyer, on a deal that closed April 30, was PEA Realty Inc.
Giuffre can oversee the purchase and sale of almost any property. But his sweet spot is properties that aren’t appealing to others. “What makes a building desirable to me,” he says, “is a building that’s undesirable to everyone else.”