The Commercial Real Estate Investor Podcast

Key Takeaways:Hire slow, fire fast when it comes to contractors and builders. Aligning incentives is crucial.Avoid 50/50 partnerships in real estate development. It's better to have a clear majority ownership and decision-making control.Budget significantly more time for rezoning and entitlement processes than the typical 4-6 months, more like 6-9 months.Diversify your income streams as a developer, such as starting a brokerage, wholesaling deals, and running an educational program.Obsess over costs and line items, and always get backup invoices from contractors to maintain control over the financials.

Key Takeaways:Focus on active listening, nonverbal cues, and tactical empathy to better understand the other party's motivations and priorities.Gather as much information as possible and build rapport before making offers or counteroffers.Use anchoring and micro agreements to guide the negotiation in your favor.Present market context and the impact of unrealistic pricing to help sellers be more realistic.Be creative in structuring deals to satisfy both buyer and seller interests, such as adjusting interest rates, purchase prices, or payment terms.Appeal to the other party's interests rather than getting stuck on positions when negotiating.

Key Takeaways:Specialize and become an expert in a specific niche of commercial real estate to attract referrals and build credibility.Build strong relationships and provide excellent service to clients - this will lead to more referrals.Ask for referrals directly, especially after completing a job well. Offer referral fees to incentivize others to send you business.Leverage relationships with residential real estate agents, as they can be a great source of referrals for commercial brokers.Use a CRM to track referrals and stay organized. Customize it to your needs and team.Consider starting your commercial real estate career as part of a team rather than solo to build credibility and leverage others' expertise.

Key Takeaways:Real estate is more political than politics - developing relationships with local officials and understanding the entitlement process is crucial for successful development projects.Nashville has experienced rapid growth, leading to challenges with managing growth and infrastructure. Density and mixed-use development are important but face resistance from some community members.The entitlement process in Nashville has become much more lengthy and difficult, now taking 15-18 months on average compared to 7 months previously. This poses risks of losing buyers if projects take too long.Construction lending is very challenging in the current environment, adding further risks to development projects.Reaching out to experts like Eric Deems at Land Advisors Organization can provide valuable insights and data on the Nashville real estate market to help navigate these challenges.

Key Takeaways:Financing is challenging for commercial real estate deals, with lenders only offering 50-60% loan-to-value ratios on a strong industrial deal. Tyler is seeking a lender that can provide 70-75% financing.The Walgreens and CVS store closures present opportunities for commercial real estate brokers to negotiate early lease buyouts with the companies, then find new tenants for the desirable locations.Buying boutique commercial real estate brokerages can be difficult, as they are often built around a single high-producing agent rather than a true business. It may be better to try to recruit top agents from these firms instead.Commercial real estate development projects can be difficult to document and share on video, but Tyler is interested in creating more development-focused content for his audience.When assessing commercial properties, key factors beyond just the physical condition include zoning, environmental surveys, and geotechnical analysis - items not as crucial for residential properties.

Key Takeaways:There are concerns about the potential liability for brokers and property managers using AI-powered tools like RealPage, if the tools have biases that lead to unfair rent pricing recommendations.It's unclear if new construction technology like Field Materials solves a major problem today, given the challenges of getting multiple parties to adopt new tools in the construction process.Enterprise-level software for commercial real estate may not always justify the high cost, as it doesn't fully replace employees and requires dedicated staff to manage the implementation.Brokers should carefully evaluate the value and functionality of new technologies to ensure they are worth the investment, rather than just adopting the latest tools.Nate has some Ohio vacation cabins for sale that listeners can inquire about through his LinkedIn profile.

Key Takeaways:Cost segregation is an advanced depreciation strategy that allows you to depreciate certain components of a commercial property (like flooring, cabinets, appliances) over a shorter 5-7 year period instead of the standard 27.5 or 39 year period. This can provide significant tax savings.Cost segregation studies are recommended for properties over $200,000, as the upfront cost of the study is usually worth the tax benefits. Even a $480,000 property can see $120,000 in year one depreciation deductions.The potential downsides of cost segregation include not being able to use the tax benefits if you don't have enough tax liability, and potential recapture taxes when the property is sold.Some of the best assets to maximize depreciation benefits are mobile home parks, RV parks, and golf courses, which can allocate 70-80% of the purchase price to 15-year land improvements that qualify for bonus depreciation.When investing in syndicated deals, key factors to consider are the experience and integrity of the sponsor, the cash flow, and the ability to utilize the tax benefits from cost segregation and depreciation.

Key Takeaways:Walgreens is closing a significant number of its US stores, up to 25% of profitable locations, due to an unsustainable pharmacy model. This presents potential opportunities to acquire vacant Walgreens properties in good locations.Tyler advises against buying dollar general stores due to their short lease terms and potential for location obsolescence.Cauble is launching a commercial real estate brokerage mastermind and a 12-week course to teach foundational knowledge for new brokers.We discuss financing strategies for commercial real estate, including using commercial lines of credit and equity in existing properties.Tyler discusses his views on the affordable housing crisis in Nashville, suggesting government incentives and higher density rezonings as potential solutions.Cauble is planning a commercial real estate conference in Nashville in October with keynote speakers, breakout sessions, and exclusive content for his accelerator group.

Key Takeaways:Gather specific market data and property information to strengthen your negotiating positionDetermine your walkaway price and other non-negotiable terms before entering negotiationsUse strategic questioning to uncover the other party's motivations and find common groundEmploy tactics like tactical empathy, flipping the script, and asking "how am I supposed to do that?" to change the dynamics of a negotiationBe transparent and willing to share your experiences, both successes and failures, to help others learn

Key Takeaways:Commercial property valuation involves considering many factors beyond just the cap rate, including rent roll, tenant credit, market trends, population growth, and development costs.Filling information gaps through networking and direct communication is crucial, as data sources like CoStar may not always be accurate or complete.Sudden changes in the market, like interest rate spikes, can significantly impact property valuations and require frequent re-evaluation.Diversifying risk by having multiple tenants in a property is important, rather than relying on a single large tenant.Experienced investors who have been through real estate cycles are valuable, as they can better anticipate and manage risks.