The Real Estate Espresso Podcast

On today’s show we are talking about small bay industrial. This is a segment that offers incredible flexibility. It doubles as office space, as a gym, as last mile inventory for e-commerce. It can even be used as a man-cave for exotic vehicle collections. The past few years have seen a lot of large bay industrial capacity added to the market. In fact, I think there has been so much new supply added, that in some markets, there is excess supply. Amazon overbuilt by nearly 33M SF in 2022 alone. Of course they’re just one supply chain. Adaptability is one of the primary advantages of small-bay facilities. It allows properties to be easily reconfigured to suit different operational needs, allowing landlords to benefit from higher occupancy rates, reduced downtime between tenants, and the ability to cater to shifting market demands. Low competition from new small-bay development enhances the landlord-friendly aspect of small-bay facilities and allows for consistent rent appreciation. We have seen rents in many major cities rise from $8 per SF NNN to over $14 per SF NNN. This represents a significant opportunity to buy existing properties and push rents higher. -------------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

On today's show we are looking at China's global leadership in automotive. This is something that will ultimately affect US design an manufacturing, which in turn affects real estate. -----------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

Kelley Brine is based in NYC where she is President of Rose Valley Management, managing a portfolio of more than 10,000 units. On today's show we are talking about the investment mandate and how it has changed. ------------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

Kris Reid is based in Valencia in Spain from where he is active in US real estate investing. On today's show we are talking about how to use a podcast as a relationship building platform as a source for new business and referrals. To connect with Kris, visit iconsofrealestate.com----------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

On today’s show we are talking about life changing new habits. I’m going to share how I am using artificial intelligence on a daily basis. I have an AI assistant perpetually open on my phone and on my computer’s desktop. If you are like most people, you probably  experience decision fatigue at a certain point. I know that I certainly do. So one of the ways in which I use AI routinely today is to save mental calories. So if I want to come up with an idea, I will often ask an AI tool to brainstorm 10 ideas on a very specific topic. It takes less energy to review a list of 10 ideas snd use that to stimulate my own thinking than coming up with something from a blank page. -------------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

I’m astounded at the frequency with which I see absolute fantasy in proposed commercial projects. The discussion involves the development of a luxury mid-rise building in a tertiary market. Where these smaller tertiary markets have an advantage, is that they have less infrastructure at the municipal level. They won’t have a multi-billion dollar subway system to build and maintain. They don’t have a massive social assistance program. The extent of their utilities is much more contained and therefore the impact fees charged to developers are much lower. So that has the effect of lowering the land cost. Generally speaking, the land cost will be lower compared with the competitive environment of the big city.This past week I looked at a project that has taken investor capital from some pretty savvy people. Yet somehow in a matter of about 3 minutes I was able to spot the flaws in the investment thesis by this so-called developer. -------------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

On today’s show we are looking at an event in financial markets that could represent a tipping point. These events have occurred with regularity over the years. Think of the Greek Sovereign debt crisis in 2012 that threatened to topple the entire European banking system. Think of Lehman Brothers in 2008. There was the bank failures in the US in 2023. These events often expose the counter party risk that is inherent in our globally interconnected financial system. The problem is showing up in the latest spike in US Treasury yields. It happened very rapidly between May 1 and May 2 of last week. Now we have become accustomed to very high volatility in US Treasury yields. Most of that is routinely blamed on the unpredictable nature of the White House.But this one was different. There was no news from the White House that fundamentally would affect Treasury yields. The threat to impose tariffs on foreign movies is not enough to move the needle. So who is dumping US Treasuries? What happened at the same time as the spike in US Treasury yields was a precipitous drop in the Taiwanese dollar against the US dollar. So who in Taiwan is dumping Treasuries? It turns out that Taiwanese life insurance companies had loaded up on US Treasuries and failed to purchase a hedge against interest rate volatility.  Why did they not buy insurance? They thought the insurance was too expensive. The liberation day announcement from Donald Trump had been pending for weeks. It was making front page headlines around the world, and still the risk managers at these Taiwanese insurance companies thought that they would take the risk and not buy the insurance. The high price of the insurance was a reflection of the elevated risk.---------------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

On Thursday evening, my development company will be hosting a webinar with an update on the second year of our storage fund. We have invested in 3 assets so far and have more in the pipeline. To register for the webinar, visit: https://event.webinarjam.com/register/36/qq2o7h6p----------------Today's question come from Ramon who asks:"Wondering your perspective on Warren Buffett’s recent assessment of real estate investing vs stock market investing (link below). Seems to me that he completely ignores the ability to add value / force equity in real estate which takes work but can generate massive returns. That is not possible to do in stock market investing unless you take very large positions that are beyond the reach of average investors or really anyone but the largest of investment/hedge funds. "---------------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

On today’s show we are talking about the methods that major importers are using to delay or outright eliminate the impact of tariffs. Let me be clear, I’m not a global transportation expert, nor am I here to offer any legal advice on what you can and can’t do when it comes to importing good to the US or any other country for that matter. But I can point you in the direction of areas in which you might want to perform your own research.Tariffs and duties have been making daily headlines for the past month. We have also seen a lot of volatility when it comes to the regulations that seem to change from one day to the next.If you are importing goods to the US that might be already on a ship, you might be understandably upset to find that an order you placed months ago would face a steep tariff charge that you had not planned for, and then maybe a few weeks later discover that the tariff you paid might be changed, lowered, or maybe even eliminated. As a business owner, what can you do to protect the value of your inventory?To start with, you don’t need to pay the tariff the second the goods enter the country. Again, I’m not offering advice here. This is something you will want to check out for yourself with the consultation of experts. There is something called a customs bonded warehouse. The items in a customs bonded warehouse are physically in the US, but have not cleared US Customs. The duty only gets paid when the goods leave the warehouse. So let’s say that you have several months of inventory in your supply chain. You maintain a steady flow of material entering the country and those deliveries are coming every 4 weeks. You have 3 months until you deplete your domestic inventory. So instead of paying the tariff when the container comes off a ship, how about putting those contents in a bonded warehouse instead?--------------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)  

Jason Brick is based in Portland Oregon where he is a nation wide expert on safety and security. On today's show we are talking about the various approaches to security when looking at properties. He is also the author of several books on safety and security which can be found on Amazon or on his website. To connect with Jason visit https://www.safestfamilyontheblock.org/-----------**Real Estate Espresso Podcast:** Spotify: [The Real Estate Espresso Podcast](https://open.spotify.com/show/3GvtwRmTq4r3es8cbw8jW0?si=c75ea506a6694ef1)   iTunes: [The Real Estate Espresso Podcast](https://podcasts.apple.com/ca/podcast/the-real-estate-espresso-podcast/id1340482613)   Website: [www.victorjm.com](http://www.victorjm.com)   LinkedIn: [Victor Menasce](http://www.linkedin.com/in/vmenasce)   YouTube: [The Real Estate Espresso Podcast](http://www.youtube.com/@victorjmenasce6734)   Facebook: [www.facebook.com/realestateespresso](http://www.facebook.com/realestateespresso)   Email: [podcast@victorjm.com](mailto:podcast@victorjm.com)  **Y Street Capital:** Website: [www.ystreetcapital.com](http://www.ystreetcapital.com)   Facebook: [www.facebook.com/YStreetCapital](https://www.facebook.com/YStreetCapital)   Instagram: [@ystreetcapital](http://www.instagram.com/ystreetcapital)