JF3783: Building a $350M Portfolio Through Small Bay Industrial & Neighborhood Retail ft. Nikita Zhitov
Jan 12, 2025
auto_awesome
In this engaging conversation, Nikita Zhitov, owner of City Plat—a commercial brokerage with a stunning $350 million portfolio—shares insights into his journey in real estate. He discusses the strategic advantages of investing in small bay industrial and neighborhood retail properties. Nikita emphasizes discipline in acquisitions and the challenges of wearing both broker and investor hats. He also reflects on lessons learned from past investments and unveils exciting new projects in the Raleigh area, shedding light on the evolving market.
Nikita Zhitov emphasizes the importance of discipline and consistency in investment strategies, particularly within the small bay industrial and neighborhood retail sectors.
He discusses leveraging strong relationships with lenders and brokers to secure favorable off-market deals, enhancing his investment strategy's effectiveness.
Deep dives
The Affordability Crisis and Investment Opportunities
The rising affordability crisis in America has created a significant demand for affordable housing solutions. Crystal View Capital is strategically positioned to address this issue by offering investors the chance to capitalize on manufactured housing communities that are often recession-resilient. By acquiring properties that require value-add opportunities in key U.S. markets, the company has managed to provide consistent double-digit returns even during periods when other investors faced difficulties. With a focus on off-market deals, Crystal View Capital gives investors unique access to niche asset classes that can yield substantial benefits.
Nikita Jutev's Real Estate Journey
Nikita Jutev, owner of CitiPlat, shares his extensive experience in the commercial real estate sector, which spans over two decades. Starting with his first apartment building purchase in high school, he transitioned from real estate development to focusing on small bay industrial and neighborhood retail centers. Jutev emphasizes the importance of discipline and consistency in investment strategies to avoid pitfalls associated with pursuing diverse asset classes without focus. His company's methodology highlights the efficiency of dealing with small retail spaces where tenant turnover and re-leasing can be handled without significant financial strain.
Understanding Neighborhood Retail and Its Benefits
Neighborhood retail is characterized by smaller tenant spaces, typically ranging from 2,000 to 3,000 square feet, offering significant advantages over large box retailers. Jutev notes that filling vacancies in small retail units is much easier due to the sheer number of potential tenants compared to large box stores, which often face longer downtimes when a major tenant leaves. This dynamic provides a more manageable risk profile as businesses in smaller spaces can backfill quickly with minimal expense. As a result, small bay industrial spaces and neighborhood retail centers become appealing investment targets, mitigating the risks associated with larger properties.
Investment Strategies and Asset Management
Jutev discusses his current strategy for investing in small bay industrial and retail assets, focusing on acquiring existing properties rather than new construction due to high construction costs. He highlights a preference for a buy-and-hold approach to investment, occasionally selling properties that no longer fit the desired portfolio. Through thoughtful asset management and leveraging refinancing options, he aims to recoup initial equity while maintaining a steady cash flow. Additionally, he emphasizes the importance of strong relationships with lenders and brokers to secure favorable off-market deals, enhancing his investment strategy's chances for success.
Amanda Crusie and Ash Patel interview Nikita Zhitov, owner of City Plat, a commercial brokerage specializing in industrial and neighborhood retail real estate. Nikita shares his journey in real estate, discussing his focus on small bay industrial and neighborhood retail, investment strategies, and the importance of maintaining discipline in acquisitions. He also delves into the challenges of being both a broker and an investor, lessons learned from past investments, and his upcoming projects in the Raleigh area.