JF3786: Triple Net Development Strategy, Drive Through Risk Mitigation, & Exit Strategy ft. Chris Hatch
Jan 15, 2025
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Chris Hatch, a third-generation commercial real estate owner and co-founder of Forza Commercial, dives into his transition to ground-up development, sharing a fascinating case study on Dutch Bros Coffee. He emphasizes the crucial role of networking in real estate, discusses financial insights, and explores the economics behind drive-through facilities. The conversation also touches on evolving growth strategies for coffee chains, the dynamics of investing in fast-food properties, and the optimistic outlook for retail in the coming years.
The podcast highlights the significant role of networking in commercial real estate, crucial for navigating investment strategies and market trends.
Chris Hatch shares insights on retail real estate's resilience and growth potential, especially with well-located properties amid rising occupancy costs.
Deep dives
Addressing the Affordability Crisis
The affordability crisis in America has led to a growing struggle for residents to find suitable housing options. This situation presents an opportunity for investors, particularly through organizations like Crystal View Capital, which focuses on providing affordable housing solutions. They are strategically acquiring manufactured housing communities with the potential for value enhancements in key markets across the United States. By doing so, investors can benefit from resilient asset classes that typically perform well even during economic downturns.
Unique Investment Opportunities
Crystal View Capital sources 92% of its deals off-market, allowing investors access to unique opportunities within niche asset classes. This advantage enables the company to capitalize on less competitive markets, fostering higher potential returns for its investors. By focusing on manufactured housing, which is often overlooked, the company can offer distinctive investment propositions compared to conventional commercial real estate options. This innovative approach has proven successful, yielding consistent double-digit returns while many other firms are struggling.
Insights on Retail Real Estate
The podcast discusses the thriving potential of retail real estate in current market conditions, highlighting that the demand for retail spaces has not declined despite public perception. As more housing is constructed with limited new retail options, property owners can benefit from rising occupancy costs, as successful retailers can often afford higher rents. This growing market indicates that owning well-located retail properties can lead to increased profitability through lease renewals. The combination of high sales volumes from tenants like Chick-fil-A and Dutch Bros further supports this positive outlook.
The Future of Fast Food and Ghost Kitchens
The fast-food industry is expected to continue its growth, particularly through concepts such as ghost kitchens that cater to the rise of food delivery services. These ghost kitchens, often operating out of established fast-food locations, manage to deliver diverse food offerings without needing a separate physical presence. The podcast emphasizes that customers tend to prefer well-known national brands due to their operational efficiencies and food safety standards. As consumers increasingly seek convenience, fast-food chains are likely to innovate and expand, further driving growth in the sector.
Joe Cornwell interviews Chris Hatch, a third-generation commercial real estate owner and co-founder of Forza Commercial, Legend Partners, and Mahalo Pros. Chris shares his journey into real estate, the transition to ground-up development, and insights into his portfolio, including a case study on a Dutch Bros Coffee project. The conversation highlights the importance of networking in the real estate industry and discusses financial insights and market trends affecting development costs and investment strategies.