The Source of Commercial Real Estate
Value-Add Small Bay Industrial with Frank Forte
Jan 27, 2025
Frank Forte, the Chief Investment Officer and founder of Lucerne Capital Partners, shares his extensive experience in real estate investing, having executed over $300 million in transactions. He discusses the appeal of value-add small bay industrial properties and the challenges of long-distance investing. Forte emphasizes the importance of meticulous due diligence and effective tenant management. He also shares insights on adapting strategies across different states and the necessity of building a local team to navigate the complexities of the market.
36:54
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Quick takeaways
- Investing in value-add small bay industrial properties requires careful assessment of deferred maintenance costs and strategic improvement justification.
- Success in small bay industrial investments hinges on understanding market dynamics, emphasizing location, and maximizing tenant demand through effective management strategies.
Deep dives
Challenges of Deferred Maintenance in Value-Add Investments
Investing in value-add commercial properties presents significant challenges, particularly due to the costs associated with deferred maintenance. The rising expenses of improving these properties can often make previously attractive deals unfeasible. A focus on mismanaged properties can still yield opportunities, but investors must carefully evaluate whether the improvements warrant the investment. This nuanced landscape requires keen analytical skills to determine when to proceed with a deal and when to walk away.
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