The Commercial Real Estate Investor Podcast

Key Takeaways:The Salt Ranch Hotel project in East Nashville was initially designed as a $17 million renovation, but had to be redesigned to a $10 million project to secure funding.The permitting process took 18 months, which Tyler described as an "absolute nightmare" due to government regulations and unexpected costs, like having to re-engineer the storm water system.Jacob Kromhout was brought on as the project manager to oversee construction, manage the budget and timeline, and serve as the communication link between Tyler and the general contractor.The hotel features many historical elements like exposed brick walls, hand-carved casings, and tall original windows that the team is working to preserve and incorporate into the boutique design.The project is currently making good progress, with exterior painting, tile installation, and framing/drywall work underway. Securing the site as the weather gets colder is a near-term priority.Tyler and Jacob plan to provide monthly construction updates to share the progress on the project, which is aiming for a spring 2025 opening.

Key Takeaways:Finding deals is not Tyler's biggest challenge as an investor - raising capital is. He has built a strong investor base through platforms like YouTube.Tyler emphasizes the importance of understanding the entire development process and learning from different trades, not just focusing on your own specialty.Financing, especially from banks, is a major challenge in commercial real estate. Tyler works with a few reliable lenders to make the process easier.Launching a podcast can be an effective way to build an investor base by developing long-term relationships with listeners.Tyler advises against letting a quick close compromise the due diligence process - it's crucial to still conduct proper inspections and evaluations.Networking through industry associations like CCIM, SIOR, and ULI can help connect new investors with others in the commercial real estate space.Tyler's investment strategy aims for a 2x equity multiple over 5 years, prioritizing long-term value creation over immediate cash flow.While Tyler has limited experience with campgrounds, he sees them as an interesting investment opportunity that requires understanding the specific market dynamics.

Key Takeaways:Focus on habits and controllable actions rather than just setting outcome-based goals. Break down big goals into smaller, daily/weekly tasks.Regularly communicate with clients, even if there is no new activity to report. Weekly or monthly check-ins can help maintain relationships.Understand the evolving KPIs in different commercial real estate sectors, like the shift in retail from just sales per square foot to more holistic metrics.Qualify potential clients quickly to ensure the assignment is a good fit and worth pursuing, especially in the retail sector.Leverage simple, actionable goals like asking for referrals in every conversation to drive incremental progress.Be open to feedback and suggestions from the audience to improve future discussions and cover topics of interest.

Key Takeaways:Tyler is starting site work this week on his Salt Ranch boutique hotel project in Nashville. He has also filmed enough YouTube content to last through February.Tyler hosted a CRE Accelerator mastermind call where students presented various commercial real estate deals, including a ground-up development, an owner-occupied deal, and a seller-financed deal. The group is planning an in-person event in Birmingham focused on flex space and ground-up development.Tyler had to let an employee go and hire a new attorney to handle the employment law issues. He is currently hiring for an office manager position.Tyler shared his experience and perspective on the multifamily market, noting that he prefers commercial real estate investments over multifamily due to concerns about overvaluation and lack of good deals.Tyler discussed his thoughts on the office market, stating that it depends on the specific location and property, and that he is selective in his office investments, preferring properties in areas with less competition.Tyler provided advice on tenant improvement allowances (TI) for retail spaces, emphasizing the importance of understanding the market and structuring leases that add value to the property.Tyler encouraged a recent finance graduate to consider starting in commercial real estate brokerage, rather than property management, if they are willing to work hard and go without a salary for the first 6-12 months.

Key Takeaways:Tariffs could significantly impact commercial real estate by increasing construction costs, reducing consumer spending, and putting pressure on commercial real estate values.Deregulation could benefit commercial real estate by reducing barriers for businesses, inspiring business confidence, and potentially streamlining processes like permitting and zoning.Immigration policies under Trump could exacerbate labor shortages in the construction industry if there are mass deportations or tightened immigration.In a high inflation environment, affordable and flexible spaces like contractor garages and micro-spaces may be viable options for tenants.The impact of Trump's policies on commercial real estate will depend on the specifics and how they are implemented, as well as the broader economic context.Owning hard assets like real estate may be a good hedge against inflation, but the overall investment strategy should consider the nuances of the economic and policy changes.

Key Takeaways:Identifying Emerging Markets:- Track public infrastructure projects, city council meetings, and development plans to identify areas primed for growth. - Look at residential market indicators like days on market to spot emerging neighborhoods. - Understand the local market dynamics, not just national trends.Balancing Risk vs. Reward:- Quantify and manage different types of risks, including feasibility, financial costs, and quality. - Aim for a low basis to better withstand potential risks. - Focus on buying right, as that can help mitigate issues even if other aspects of the project go wrong.Maintaining a Deal Pipeline:- Utilize Aristotle's advice - tell people what you're looking for, tell them, and then tell them what you told them. - Build relationships and network actively to uncover off-market opportunities. - Communicate your investment criteria clearly to everyone in your network.Staying Competitive Without Overpaying:- Prioritize understanding the seller's needs and offering unique solutions over just competing on price. - Build rapport and relationships with sellers to create a competitive advantage. - Consider the "blue ocean strategy" to find ways to provide value without direct competition.

Key Takeaways:Investing in education and resources: The participants recommended several books, trade publications, and industry events that have been valuable for commercial real estate brokers to invest in their professional development.Importance of mentorship and coaching: Finding the right mentor or coach, whether paid or unpaid, can have a significant impact on a broker's career growth. Building relationships and adding value are key to finding effective mentors.Leveraging mastermind groups: Participating in mastermind groups with other brokers and industry professionals provides opportunities to learn from others' experiences, build a valuable network, and gain new perspectives.Time management and efficiency: Implementing tools and habits like calendars, email management, and team coordination can help brokers stay organized and focused in the face of the many demands of the job.Personal branding and differentiation: Developing unique personal branding strategies, like wearing distinctive attire, can help brokers stand out and make a memorable impression with clients.

Key Takeaways:Focus on value-add projects rather than new construction - Why I prefer value-add deals as they often provide similar returns with less risk and debt compared to ground-up development.Importance of setting SMART goals - The value of setting Specific, Measurable, Achievable, Relevant, and Time-bound goals to increase the likelihood of achieving them.Surround yourself with the right people - I credit much of my success to being in the right rooms and networking with the right individuals who helped guide and support my growth.Challenges with the "Wash" project - Parking constraints have been a major issue in replicating this unique commercial real estate concept in other locations.Advice for new commercial real estate brokers - Read "Walkable City" by Jeff Speck to gain a deeper understanding of urbanism and city planning.Importance of proactively raising capital - Create a list of 100 potential investors and consistently promoting investment opportunities to successfully raise capital.

Key Takeaways:Focus on meaningful goals, not just financial ones. Tyler found that achieving monetary goals often felt empty and unfulfilling.Hire key personnel to handle operations and free yourself up to focus on your strengths, like content creation.Aggressively grow your content production and distribution, aiming for 50-100 pieces of content per week across platforms like YouTube.Expand your brokerage to 3-5 locations outside of Nashville over the next 5 years.Dedicate resources to your educational platforms like the CRE Accelerator and Brokers Mastermind to become the premier commercial real estate education provider.Emphasize the journey and personal growth over just hitting numerical targets. Enjoy the process, not just the end result.

Key Takeaways:There will be a 2-day CRE Accelerator Mastermind event in Nashville on October 18-19, 2024. This will be the first of these quarterly events.Approvals have been received for the Peerless Mill project, a 29-building industrial facility in Rossville, Georgia. I plan to start with indoor climate-controlled self-storage and industrial outdoor storage in phase one.The benefits of using self-storage management companies to handle upfront work like market studies and pro formas when getting into self-storage are discussed.During the mastermind event, I will cover topics like finding and funding your first deal, a property tour, and a goal-setting workshop for 2025. There will also have a session with a guest speaker on building business models for real estate investments. The value of the mastermind community and the importance of being selective with business partnerships to avoid dealing with "bad actors" in the industry is emphasized.Discussion on being open to different entry points into commercial real estate, including brokerage, accounting, urban planning, etc. and how to find value in learning from various perspectives.Why I prefer the mastermind group approach over one-on-one consulting due to the scalability and community benefits it provides.