The Easiest Commercial Property for Beginners to Own

[@TylerCauble]

Wanna dive deeper into commercial real estate investing? Check out www.crecentral.com for online commercial real estate courses, 1-1 mentorship, and more.

[@ericareid4591]

Hello. Would you need to be a licensed agent in order to take the commercial real estate course?

[@MrSeriouscomic]

I am building a 85,000 sf flex space project right now. Getting the pro-forma to work in this high-interest rate and high construction costs environment is harder than it was portrayed here

[@rohanpatel8886]

where ? i am thinking to do the same in NE philly suburb. thanx.

[@passitforward]

KZbinrs make everything look soo easy so that they can sell you their course

[@TylerCauble]

You can get everything you need on KZbin for free here 😂

[@TylerCauble]

@mrseriouscomic - it depends on your market for sure, and how you’re planning to handle construction, your local regulations, etc., but this is entirely possible in suburban / rural locations

[@1realtruthrightnow742]

@@rohanpatel8886 We have a close eye on you.

[@rickdunn3863]

I think ANYONE who is interested in commercial real estate need to investigate getting financing before they jump in. I am a residential real estate investor, but when I bought my first commercial metal building in Industrial zoning I hit a brick wall with financing. I could only get a 5 year ballon mortgage. I was told this is how commercial real estate financing worked. I know not to do ballon mortgages since I don't have a crystal ball. How I got around this was a SBA loan on the building. I personally like residential over commercial for a bunch more reasons.

[@TylerCauble]

100% - that's usually the first thing I recommend anyone interested in commercial real estate do: build relationships with commercial brokers and commercial lenders. The process is very different from residential real estate

[@realtorlifewithdave]

This is exactly what I'm going through right now!! But SBA requires 51% owner occupied.

[@rickdunn3863]

@@realtorlifewithdave I occupied the building, so it wasn't an issue for me. Not sure how to handle your situation, but If it were me, I would be creative.

[@timcrawford7923]

Excellent advice thanks

[@twi5tyfruitcake]

What r the reasons u like residential more?

[@rishiramkissoon6976]

Good video an so true. My first business was a coffee microroastery and getting flex space that is affordable and can be permitted for food production is hard. IN Tampa we had a surge inlocal craft food and these spaces became $. I found one across the bridge in St. Petersburg and I spent years in the space observing other businesses. I quickly realized, that this is the business I should have been in. 1500-2000 sq ft flex spaces are incubators for small business for everthing from food, services, light manuf., logistics, retail/wholesale. Construction is straightforward. If I have the capital in the future it would definitely be the commercial project of my choice-having been a tenant myself

[@VanGoWanderlust]

I'm trying to FIND a flex space for just this purpose. How do I find one? What's the magic word to google? Flex space brings up a lot of warehouses, but not zoned for what I need.

[@TylerCauble]

they're great assets!

[@Bobby-hn3cu]

@@VanGoWanderlustare you looking for spaces that permit food processing or something else?

[@miguelrodriguez7253]

My goal for this first quarter is to understand everything you talked about in this video.

[@TylerCauble]

Love it! I’ve got all the videos you need here on this channel 👊🏼 let me know whatever questions you have in the comments as you dive in

[@miguelrodriguez7253]

@@TylerCauble absolutely, I’m relocating to Reno and my goal is to start a business and own my own commercial real estate there but I’ll be real with you 80% of this video went over my head and I take personal offense to that, it’s time to do bettet

[@TylerCauble]

@miguelrodriguez7253 haha love it! Time to dive in and consume all the knowledge you can 🔥

[@BlackRifleRack]

Dude is on point. This is the game I played. More money in your pocket if you develop, good deals are "rare", Commercial loans cost more short term with balloon payment, I could not get one had to non doc loan 2 houses and still did not have enough money to finish. Luckily I was able to sell my house at the time, made 100k in one year. Project was finished in 2007. Just sold at 100% profit. Just 1031 to a 9% cap rate with 5 year leases. Did alot of research. Get a rood inspection as this can numbers fast. Nothing is easy but this is doable but you need money to start and the land.

[@TylerCauble]

That’s pretty much exactly what I do - do an “active” deal where I have to put a bunch of work into it, then 1031 the proceeds into a STNL or other NNN lease deal to set it and forget it, then repeat the process. Doesn’t take too many of those to retire

[@WTF-sh4is]

I can attest to this video. My dad has bought over 100,000 sq ft of industrial flex space and tailored it to multiple small business tenants. He’s rolling over $800k per year now.

[@TylerCauble]

Nice!

[@kelvinjohn5533]

Hi Tyler, your speech is so inspiring and I would love to know if you have courses on how to go about it?

[@TylerCauble]

I appreciate it, Kelvin! You're welcome to learn more about the courses here: www.tylercauble.com/course

[@kelvinjohn5533]

@@TylerCaubleHey, I went through your post here, and judging from the contents, you're good at what you do. So, I was wondering what your email funnel is like.

[@AGmgmtinc]

I love this space. Great video, I like how you break it down.

[@TylerCauble]

Appreciate it, Amit! Great talking with you earlier

[@jeffmomoney1718]

Here in Florida I’m looking at 300k per commercial acre and that’s on the low side

[@TylerCauble]

Yep - varies all over the country depending on supply / demand

[@BlackRifleRack]

Building supplies are too high at the moment.

[@mikesterman123]

Is it still profitable? Also in south Florida and curious on the other numbers you’re looking at if you don’t mind sharing. I will probably stick to buying and renting but still curious on construction costs

[@StephanRaczak]

Thanks for this insightful video. You have a calculation mistake in there though: 43,560 sqft * 5 USD = 217,800 USD (not 240,000 USD as you mentioned). In my own plot acquisition research, I am aiming at paying no more than roughly 100k for 1 acre.

[@TylerCauble]

Good catch!

[@clifft2269]

​@@TylerCauble your editor also doesn't know what pickle ball is lol

[@falaafalstick]

I always wanted to learn about commercial property, but I dislike asking people because I dislike learning from people and I dislike teaching people

[@tadowdammit9153]

A great glamping space is relatively easy and depending on what you paid for the land could be very profitable.

[@TylerCauble]

Truth. We've looked at doing some of those in Chattanooga, would be a fun move to make

[@SouthFloridaLivingWithKyle]

Definately earned my subscription. Great informative content.

[@harrylawrealestate]

Def attending his event to meet like minded individuals. Multifamily is saturated with gurus which more will come. Industrial all the way.

[@TylerCauble]

Nice man! I’ll see you there

[@kevincombs6034]

Very good introduction to the asset class. Their defination of flex space is wrong however. Technically flex space requires 50% to be office. I think that defination is softening over the years to include an industrial product that "could" have office, meaning it could legally occupy a business all day every day in a space that is climate controlled, has a bathroom, and possibly sprinklers. This is not to be confused with a Contractor Garage, which is what i do. Flex has nothing to do with "being flexible", use-wize. It has to do with a % of the space that can be office. Everything else, including the land costs, construction numbers, cap rates, etc are spot on. Cheers

[@TylerCauble]

I appreciate it! The definition isn’t wrong, it certainly doesn’t “require” you to have 50% office. I’ve been doing this for over 11 years now and have rarely seen flex space with 50% office. Cheers

[@kevincombs6034]

That's the technical definition, but like i said it's not reality. The reality is it must have some office or the ability to have office. It has nothing to do with being "flexible". It's ok man, you can admit a mistake 😉. Great video.

[@kevincombs6034]

From Costar's glossary: Flex Building A type of building(s) designed to be versatile, which may be used in combination with office (corporate headquarters), research and development, quasi-retail sales, and including but not limited to industrial, warehouse, and distribution uses. At least half of the rentable area of the building must be used as office space. Flex buildings typically have ceiling heights under 18', with light industrial zoning. Flex buildings have also been called Incubator, Tech and Showroom buildings in markets throughout the country.

[@Myst8891]

I think it would be more advantageous to hold the property for at least 3-5 years if you have good tenants. Pay down the loan, take an income, triple net so the tenants pay tax, insurance, CAM, you’ll show cash flow, take out equity and build another. Do that every 3-5 years, you won’t have to take investor money or owe investors. After 20 years you’ll have 4 properties and retire with multiple incomes. I think once you have a few properties you could start a property management company and manage your properties along with others. Then you could sell off the flex space buildings and have income from property management or sell the management company as well. Just keep it snowballing and be patient. I am a business owner and I own the land to some of my business locations so if I sell the business down the road, I still have an income or can I can sell the land for an additional cost. Always better to be your own landlord.

[@crgshell]

I wonder how many of these metal buildings you put up your numbers seem to be highly optimistic. Have you factored in infrastructure cost you’re going to need on an acre of land. Most cities charge tens of thousands of dollars to hook up to the sewer and water or you’re gonna have to put it in your own septic system, and water-well. most urban areas are going to require you to put in sidewalks and street lighting that needs to be engineered. In fact you’re gonna have to submit engineered plans in most cases.have you factored in the cost of three phase power hook up being brought onto your property? That can be quite expensive and here in California PG&E has a one-year backlog on that and PG&E, won’t even except an application until you’ve got your building and planning permits issued by the county or city. also, if you’re going to use it for anything other than storage or industrial, you’re going to have to figure out some inside finish, which can be costly as well. Have you factored in handicap egress? I’m actually in the process of putting up 100,000 square-foot metal building in Santa Barbara county and I’ll tell you a few other things that I’ve had to contend with. Perk test, parking lots, soil, compaction and engineering, traffic, mitigation, plan, stormwater, mitigation plan, landscaping and vegetation plan, exterior lighting, electrical power offset agreement, biological resource plan and wildlife corridor‘s there’s more but that’s this is off the top of my head. I know Santa Barbara is probably more restrictive than most of the rest of the country but you’re gonna have to plan for this type of compliance. Lastly, in your video, when you’re speaking about pickle ball, you’re showing an image of a squash court?

[@TylerCauble]

California is a major exception in nearly almost every conversation around commercial real estate because their rules and regulations are far stricter than most states. These numbers / approaches work pretty well in rural / suburban locations in the South & Midwest, but California is a different beast. You’ll also be charging different rental rates, so always best to study your specific market

[@krashanb5767]

You've made a list of why everything is so expensive in California 😅

[@TylerCauble]

Yeah, I recommend against doing anything in California 😂

[@josephsteinheiser2902]

Most of the things he mentioned are required in most areas. If not by the government then by the tenant. Land development is not cheap, simple or fast.

[@MisterDivineAdVenture]

(7:00) I detect an example of the crossover point between passive (from arbitrage to stocks) and venture. Here is the precise argument to get someone out of his chair. I guess the same argument can be made for buy and hold real estate, or buy and refurb, or even buy and flip, or buy and rent to own.

[@TylerCauble]

For sure!

[@alr5373]

Generally, commercial is non-residential buildings that don't contain warehouses. They mainly contain office space. Industrial property are also non-residential buildings that contain mainly warehouses. Knowing the difference between these are important because commercial are already in a recession and prices are about to get hit really hard. Couple that with remote working technology, office buildings may never come back to where they were before. Industrial are at their opposite. That's why these metal building fabricators are so busy.

[@TylerCauble]

Industrial is a good market right now for sure. Lot's of opportunity to convert 1-2 story office buildings into flex space, as well

[@tomwilcox1671]

what type of tenant fit out are you including? If a tenant want's more office than warehouse who pays for the fit out?

[@TylerCauble]

It's all negotiable depending on what you want and what the tenant wants. If they want you to pay for it as the landlord, then I would amortize it into their rental rates. If they're willing to pay for it, then I would likely give them some free rent to help cover it

[@mikep4869]

That is certainly something to look at. Thanks for sharing.

[@TylerCauble]

Absolutely! My team is pretty excited about it, so they’ve been digging in over the last week

[@raymieyounkin7498]

Did you address build-out costs for each tenant and I just missed it in the video? I would think those additional costs would quickly erode the gains on resale after being leased-up.

[@TylerCauble]

Buildout costs are usually in the $10-$20/sf range but can range anywhere from $0 to $50+ depending on what you negotiate. Those costs are already included in my assumptions in this video, though.

[@tonyotag]

flex space depends on zoning, but if it is outside major urban areas alongside highways for easy access it is viable.

[@TylerCauble]

for sure

[@DyeBold]

What kind of zoning should the land be for flex space?

[@tonyotag]

@@DyeBold Great question, each jurisdiction has its own laws and allowances for the land. Typically, flex space as described in the video can be industrial and/or commercial (even mix use) zoning purpose. If not, a variance could happen to allow the business practice. Additionally, the local municipality (or state) would have a plat map of the city/town (or even county;) of the zoning and applicable law of the land. Keep in mind that "spot-zoning" is controversial legally speaking. I am not an attorney, seek an attorney or local real estate professional (real estate agent or government official of proper department) for answers about the particular property in question.

[@ronwatkins5775]

I am interested in getting into commercial property development. Im looking for sources to learn more about what's involved and how to get started.

[@TylerCauble]

You've landed on the right channel!

[@realtorlifewithdave]

I wonder how its labeled in terms of zoning. Ill check with the county..

[@TylerCauble]

Typically, it’ll fall under industrial zoning

[@terrifictonyschannel2071]

Nice video, but...I think the major issue is on raw land you will need to own it 100% no financing, for most banks to finance the development part. As for the development funding, you will probably need to have a competent partner who has a track record or a very good contractor with a history of building these, for a bank to lend you the construction loan and possibly still have to personally guarantee the loan. Can't say it cannot be done but those are probably the major hurdles. I saw your comment on 1031 into the raw land, I would imagine that can be done as it's still an investment property, and total investment costs (with the development) would have to be higher than the building sold. But the thumbnail says "Best for Beginners"?

[@JohnHandle-]

This is pretty easy for beginners. Money isn't really a concern even for people starting out fresh. How many investers do you think would be needed to make something like this happen? 1 or 2 hundred regular blue collars could make this happen easily. It's the easiest thing in the world. Everyone has at least a few hundred friends on facebook. Send out the message, even if only one or two percent of your friends list responds with interest- that gives you access to their friends list and the snowball has started. Money is the first problem an entrepreneur learns to navigate around. If you can't raise funds then you aren't even here yet.

[@TylerCauble]

Yep - paying cash for the land is typically the best way to approach development

[@JohnHandle-]

@@TylerCauble I am interested in investing, tell me- do you have any future projects planned?

[@TylerCauble]

@JohnHandle- we don’t right at this moment but are actively on the hunt for our next opportunity. You’re welcome to join my investor email list at www.tylercauble.com/invest

[@FoodForestBrad]

I'm so curious about building a 10,000 sf building for indoor pickleball courts in Asheville, NC. I wonder what the cheapest structure is that's suitable for that use case.

[@TylerCauble]

Flex buildings could work well for that - cheaper to build than most other types of buildings and not uncommon for uses like that to occupy them

[@AlethiaHines]

This was great information for me. I'm new to real estate investing as a newbie and planning to provide rental properties for the VA or the military. This offered a better perspective on commercial investing.

[@TylerCauble]

Glad to hear it!

[@ramezqubain8177]

You are da man. Love this. Now I am going to pursue developing flex space

[@TylerCauble]

Glad to hear it! Keep me in the loop on your journey

[@TheGarricks]

I’m doing a flex space warehouse now 10,000 sqft but I’m just not understanding well zoning and planning cost

[@plv702]

I was intrigued so I watch the video but when he said 300k down I was like whoa. Think about it how many people have 300k to build a commercial building? I think this is why you said there are not enough being built. So for me it makes sense to start with residential real estate until you can build a nest egg to possibly try commercial. Big risk tough!

[@ShameenYakubu]

Obviously? It’s commercial. It can’t be compared to residential.

[@TylerCauble]

Yep - commercial real estate isn't cheap. But you can find creative financing or partners to get you started

[@scott4string236]

Hi, I just started watching your channel. Sounds like good stuff! thanks

[@TylerCauble]

Thanks for the sub! Hope you enjoy the channel

[@ernestocarrillo7]

First time watching your videos. Subscribed right after.

[@FreshAirRules]

How do you put up a wall to the ceiling so people have privacy and don't hear the people beside them?

[@TylerCauble]

You would just frame out and finish a demising wall or you could hire a contractor to do that for you

[@feilox]

There is a HUGE demand right now... I walk past all those vacant warehouse lots... The good ones converted to garage storage systems, lmao. Unless your warehouse is middle of a city, you aren't gonna even be able stay afloat. All these vacant warehouse charging only $500/month and add free electricity lmao!

[@TylerCauble]

There's tons of demand for flex space - it's been amazing.

[@IrfanRomee]

So a tiny 10K sqft flex space costs $1.36M. Commercial real estates loans aren't that easy to get. You could make 💩 tons of money by flipping single family / multifamily homes with $1.36M cash.

[@MomentoMori769]

Does your mentorship cover , how to build a flexspace?

[@TylerCauble]

Yes - we cover all aspects of investing and developing commercial properties, excluding multifamily

[@NickStewart-dc9qo]

I like this I like what he said about the tenants great information

[@TylerCauble]

👊🏼👊🏼

[@thelastgeneration1926]

ur great at explaining things

[@TylerCauble]

I appreciate it! It’s a lot of fun getting to create this content so glad you’re enjoying it

[@carolday3381]

Now this is interesting. Interested in how to get situated to start from nothing. Then as i started typing this comment i saw the ending vid link for beginners 😊 awesome. Would like to have 3 buildings in 5 years, build the retirement fund.

[@TylerCauble]

Glad you enjoyed it! Keep me in the loop on your progress

[@deepikaatkinson4111]

Thanks for the details and explanation..😊

[@TylerCauble]

Anytime!

[@davidchang2250]

You mentioned pickle ball but the video showed racquetball lmao😅

[@TylerCauble]

Haha sure did!

[@riordan381]

Im currently gettin into developing a commercial space Big space, 3x 5000 sqft warehouses, strip mall type spaces with parking lot in front near the highway Idk how to deal with financing

[@TylerCauble]

Yep - that's a big piece there. You'll want to either bring enough money down to make the lender comfortable or have a strong enough loan guaranty to solve that problem. I always brought in bigger partners when I was first getting started to help solve those issues when I didn't have a strong balance sheet or cash

[@howiecoro]

Just curious who do you recommend for building manufactures on the east coast?

[@TylerCauble]

I’d recommend discussing that with your contractor, they’ll likely be able to point you in the best direction. Butler tends to be what I see most frequently

[@howiecoro]

Understandable… yes I have heard of Butler… I was just curious because what I noticed was a lot of these steal building companies are brokers and just do the engineering… and then it all gets manufactured out of the same plant… depending on location in the country… I am assuming there is cost savings depending on the engineering company that is all the same materials.

[@Gabstarnow_KJG]

If I do end up buying commercial land and there is a building, would I be able to knock it down and recreate the building? Because I have a certain way I would like my building to look (I’m 14 btw)

[@TylerCauble]

Yep! It’s your property, just be sure to check for any regulations that may dictate what you can or can’t build back there

[@Gabstarnow_KJG]

@@TylerCauble thank uuu ☺️🤞🏼

[@CM-sy3to]

If the land you purchase has a mortgage loan, you might not be able to knock down existing buildings without the approval of the lender.

[@miamilaz77]

What about tenant improvement dollars when leasing out to multiple tenants? how do you work that in to your numbers?

[@TylerCauble]

You typically just bake in a price per square foot for the entire project, such as $20/sf or $50/sf, depending on what type of space you're delivering and what market tenant improvement allowances are. I would survey other comparable properties to see what they're offering so you can get an idea of what you'll need to provide.

[@miamilaz77]

@@TylerCauble makes sense. Thanks

[@BrigetGstar]

One of the most briIIiant investing advice i have ever gotten on youtube came from watching an interview with *Julianne Iwersen Niemann* on CNBC. Indeed, A solid investment strategy is like a well-planted tree it can withstand storms and still grow strong...

[@MesutMilleliri]

I can only speak from my experience when I advise seeking professional advice. It looks like a smart bet if you don't know where to get an experienced one, but if you don't know anything about the market.

[@mmcleod111]

Great video. I have been researching this area and want to do my own projects

[@TylerCauble]

I appreciate it! Keep me in the loop - always exciting to hear what others have going on

[@davidburgess189]

Is it me or is $5 per sq.ft expensive for the land only?

[@TylerCauble]

Depends on where you are - that’s pretty cheap in many markets but could be considered expensive for North Dakota

[@davidburgess189]

@@TylerCauble I’m with you. I’m in Florida though and even here that sounds quite reasonable and achievable to purchase at least an acre based on $5 per sq. ft. It will have to be zoned for commercial use though, correct?

[@TylerCauble]

@davidburgess189 it would certainly be best if it was already zoned - just makes your life significantly easier. That said, you could likely find cheaper land if it needs rezoning, but it’s a significant amount of work and no guarantee that you’ll be successful with a rezoning

[@fornatitugbechie4422]

How can I learn more about this and what is a good amount of capital to start with?

[@TylerCauble]

Got plenty of videos on this channel for you to learn about investing in CRE! The amount of capital depends on what you want to do. If you’re wanting to invest by yourself, then likely at least $250k. If you’re investing with others, then likely around $50k. But it all depends

[@seanodanielsart]

Will there also be more opportunities when the commercial loans blow up in the next 5 years? Or will it be more difficult?

[@TylerCauble]

There are plenty of opportunities in any market. Depends on the sector you’re looking in - plenty of distressed office deals out there but those will require significant work to turn around. Most industrial assets are not in distress and are fine

[@seanodanielsart]

Flex space can be industrial or commercial correct?

[@TylerCauble]

@seanodaniels397 that’s correct - I think it really depends on who you’re talking to about it or what use you’re leasing to at the end of the day, but banks will treat them the same

[@afaiththatworks2249]

Tyler, I live in Hartsville TN and I want to open a Transitional Center. I have seen industrial space available, would I be able to use this?

[@TylerCauble]

Absolutely - this style of building can really work anywhere as long as you approach it right

[@afaiththatworks2249]

@@TylerCauble Thank you so very much for responding! 😁👏👏👏

[@jacobissa584]

When building a flex space. What is the recommended minimum and maximum sqft per unit?

[@TylerCauble]

It depends on your market. You’ll want to survey other flex building to see what people are and aren’t leasing. Typically, I aim for around 2,500sf. That could be as small as maybe 1,200 or as big as 10,000

[@engineeredaf1920]

my neighbor is retiring and wants to sell his commercial building. it's 10,000 sqft building on ~1/2 acre. rents are around $12/sqft/yr. i can get it for somewhere between 1.0M-1.2M. Is that a good buy for the building?

[@TylerCauble]

I know this answer is the worst, but it depends. Could be a great price or a terrible price, there are simply too many unknowns for me to tell you definitively either way. I would inspect the building, the land, and the leases to determine whether that price would really work. Could help to talk to an appraiser or commercial real estate brokers to get their thoughts, too.

[@engineeredaf1920]

@@TylerCauble thanks for your answer. Apparantly the cap rate is pretty good if I were to rent it. I’m not actually in real estate, I’m in manufacturing and need to move into a bigger facility(with air conditioning haha) but I want to make sure I’m getting a good deal. (He’s also including his metal stamping business which is Marginally profitable now since he’s not trying to take on much work) but that’s more upside to the deal… it’s at least $50k in equipment in a fire sale

[@Expcommercialbusinessbroker]

Building from the ground to completion, great video thanks for sharing

[@TylerCauble]

For sure. Best way to do it in my opinion!

[@HaleyJena-v1g]

20 Million KZbin Video Views Per Month tinyurl.com/y9uxksba

[@jsisbeingcensored]

I’m in Atx, seen many of these spots pop up. Looks like it years to get to 50% occupied. I also know owners of these properties that crush it in life. It’s a gamble in modern times with new money(loans), the winners come from old money. It’s a fact

[@TylerCauble]

Most of the deals I see are mostly leased before delivery if the right plan is put together, regardless of where money comes from.

[@andrewdefruscio1800]

Your numbers don’t make any sense to me. You say $190k profit, but that doesn’t include commissions, closing costs, or taxes. If you sell this property in your example, your net is around $100k before taxes. Figure in 30% taxes, and your net is $70k. A $70k return after $300k+ invested and two years is not worth all that risk. Am I missing something?

[@TylerCauble]

We don’t typical have to pay taxes because we’re utilizing 1031 exchanges to keep everything rolling. Absolutely the returns are worth it

[@andrewdefruscio1800]

@@TylerCauble So you are getting them leased and holding them for a time period before you sell? I’m guessing you aren’t 1031’ing new construction because the IRS would shut that down pretty quick.

[@TylerCauble]

@andrewdefruscio1800 no - the majority of what I do is heavy value-add. If you’re going to be doing these new construction and don’t want to pay cap gains tax, you just hold them for a year after completion and you can 1031. That’s the strategy most people I know are using on these

[@andrewdefruscio1800]

@@TylerCauble Cool man. Thanks for the info. I’ve been doing SFR flips and holds for a while and have been looking to getting into building and development of SFR and small commercial. I’ll check your channel for more stuff on the value add component.

[@TylerCauble]

@andrewdefruscio1800 absolutely 👊🏼

[@Ricocase]

Rates are 8+? Why would 7% cap make $? Inflation makes it worse, not including food fuel

[@TylerCauble]

Exactly - the numbers don’t work if you’re using debt

[@ohitsjaelon]

@@TylerCauble so if I’m borrowing money, I shouldn’t be trying this method?

[@BlackRifleRack]

The money just wont go in your pocket for a while an its risky but what's not?@@ohitsjaelon

[@dle632]

That wasn't pickleball

[@TylerCauble]

🎯

[@Canthev]

What beginner would be able to finance a $340,000 down payment for this theoretical flex-space deal? I guess for commercial real estate the bar for entry is much higher, but surely there are other commercial properties that can be purchased with less money down, that's more approachable for beginners.

[@TylerCauble]

$340,000 down payment is nothing if you know how to raise capital for these deals. I’ve raised more than 10x that multiple times. But I didn’t start there - my first building was $575k with $120k down payment. I bought an existing building and renovated it

[@Canthev]

@@TylerCauble yeah that's true. It's certainly possible when raising capital, but I wouldn't expect a beginner to raise capital like that. The video was pretty insightful nonetheless, thanks for sharing :)

[@TylerCauble]

@Canthev for sure, but that’s why I’m teaching people how to do it on this channel 😁 commercial real estate isn’t easy, but it is simple. You just have to have the knowledge

[@Initialcomment]

​@@TylerCaublehow many sqr

[@shawnemployee6906]

Anybody have a link to the full podcast or know the other guys social media handles?

[@TylerCauble]

podcasts.apple.com/us/podcast/the-commercial-real-estate-investor-podcast/id1514962783 @commercial_in_nashville on Instagram

[@raptheg]

love the channel bro, nothing but game

[@TylerCauble]

Love to hear it!

[@nicellis2969]

Great content !

[@TylerCauble]

Appreciate it!

[@DyeBold]

What type of zoning does the land need to be?

[@TylerCauble]

It will depend on your local municipality, but industrial

[@mayankpatel1177]

Nicely presented info

[@TylerCauble]

I appreciate it!

[@connorduffy8620]

This is great content man. Great surface level analysis but mannnn is developing risky right now

[@TylerCauble]

I appreciate it! For sure - I’d only recommend it if you really understand the deal

[@connorduffy8620]

@@TylerCauble even then, client of mine is a merchant developer. Built two $900,000 NOI deals, had a 5.75% exit….sold one a 6.6% and the other at a 7.15%….lost that value in 10 months

[@TylerCauble]

Yep - sounds like he didn’t develop them with enough margin. Sometimes people get greedy and think the market is always going to be strong and start dropping the returns they need to justify a deal. You see it in residential all the time - guys overpaying for lots / construction and losing all their money

[@2ndhandtrading]

Iam in warehousing for 25 years, just started a new projects good opportunity to invest. 😉

[@TylerCauble]

It’s a good industry for sure!

[@DwayneHeigh]

Are you factoring in soft cost?

[@TylerCauble]

These costs include everything except for debt terms since that would vary so drastically depending on person to person

[@DwayneHeigh]

@@TylerCauble thanks man! Keep adding value.

[@TylerCauble]

@@DwayneHeigh 👊🏼👊🏼

[@kiarashjahan8780]

Great video !

[@TylerCauble]

Appreciate that!

[@ToddWest-z3b]

$5 per sq ft for land is over $215k per acre. Seems really high, even for full developed business park land. Can you explain/confirm?

[@TylerCauble]

Nope - it’s not that high. Depends on where you’re located. Land in suburbs surrounding Nashville can be $30/sf or more. But if you’re in the middle of nowhere with low traffic / low population, then yes - $5/sf would be high

[@drewd7824]

Who makes the buildings? Anyone know ?

[@TylerCauble]

Butler Building Systems is one group but there’s a bunch out there

[@Whatever0704]

I would like to get into this. NNN :) instead of residential rentals

[@TylerCauble]

Highly recommend it! I love my NNN investments

[@adnannazir8660]

how do you lease and break the space up .

[@TylerCauble]

We’ve got a ton of videos on finding tenants / leasing space - probably too much to drop here but you’re welcome to check those out. You typically see buildings of around 10,000sf broken up into 4-5 tenants but could depend on how your leasing goes

[@BlackRifleRack]

Best to have partition walls and you may have to put in some roll up doors.

[@myagenthouston]

How much cash is needed? $240K to buy the land + $340K to build it?

[@amis5339]

Does flex typically include AC?

[@TylerCauble]

It usually does since there’s an office component but not uncommon for the warehouse to not have HVAC

[@3brandon]

Is this possible to do with $20k saved up?

[@TylerCauble]

Sure - you'd just have to find partners or some sort of creative financing situation

[@MoeToOFFeR]

It’s my dream to own a storage facility however, for those type of loans is nothing close to a dream. It’s actually a nightmare and extremely difficult to get approved.

[@TylerCauble]

How so?

[@alexdaubon134]

@@TylerCaubleright, since it’s difficult to obtain you’d just give up and not try?

[@650tonyd]

Is it beneficial to pay cash?

[@TylerCauble]

It can be - certainly can help de-risk the project and keep your monthly ongoing expenses lower

[@Quincy-g7f]

This may be more profitable and less involved than short term rental investing

[@user-hn9fr7mn3x]

I want access to these mythical $130sqft prices. $250sqft are the quotes I’ve been seeing recently for office/warehouse

[@TylerCauble]

Yikes! I’d find a new contractor 😅

[@delonshabo9519]

Who’s the guy at the intro ? Real estate agent ??

[@TylerCauble]

An investor, his name is Hamza

[@bvssrsguntur6338]

Does anyone has real experience with building these flex spaces inTexas?

[@TylerCauble]

There's a lot of flex development going on in Tx

[@classyeze]

Is this application to UK?

[@TylerCauble]

For the most part. Commercial real estate is relatively the same across the world with nuances in each market. You’ll want to talk to local professionals to make sure you fully understand how it works in your area

[@jeffreyavo5328]

Unfortunately, selling the property multiple times deems developer as an operator and avoids capital gains treatment on the sale of the asset versus refi and holding asset which is not a tax event. Need to go to after-tax Analysis to understand the negative in rapid sales.

[@TylerCauble]

That’s not entirely true. Selling the property you 1031 exchanged into in less than a year after buying it could trigger some questions from the IRS. You need to either hold it for a year or be able to prove that it wasn’t your intent to flip it. In that case, you’re fine to 1031 exchange as often as you want / need

[@jeffreyavo5328]

@@TylerCauble you never mentioned 1031 in your initial analysis nor the property benefiting from opp zone treatment

[@TylerCauble]

You’re bringing up capital gains issues. The easiest way to defer that is through a 1031 exchange. If you buy a property without a 1031 exchange, the same method applies here if you decide to sell in less than a year. Either 1031 to avoid cap gains tax or hold it for more than a year.

[@UsmanKhan-xs7hz]

@@TylerCaublecould you explain further? would it be better to 1031 a new construction? and how would i avoid any cap gains issues

[@matthewellis3004]

Good stuff

[@xandchitects]

Do you need to employ the services of an architect for designing these? Can I just get fiverr sellers to develop drawings I can send for approval?

[@TylerCauble]

Depends on your local municipality but more often than not, the engineer’s drawings are fine enough. I’d consult your civil engineer about it

[@SerpkoBakotiinii]

Buy land, hire construction company, get all paper...it is not the investment in commercial property, it is the development business.

[@TylerCauble]

Developing a commercial property is investing in commercial property...

[@ryanthomas2472]

$5/SF is under $220k/acre

[@TylerCauble]

Yeah, messed up the math there 😅 no worries, it’s only permanently stuck in the video haha

[@lilliankerr-z7c]

I'm in my 60s and This is no time to taper retirement savings. I want to max out my retirement contributions and I also have another $500k in a savings account that i want to invest in a non-retirement account. Where should I invest it now?

[@LeylahCollins]

Safest approach i feel to tackle it is to diversify investments. By spreading investments across different asset classes, like bonds, and international stocks, they can reduce the impact of a market meltdown. its important to seek the guidance of an expert…

[@alex-Yolan]

Oh few number of people discredit the effectiveness of financial advisors in exploring new markets, but over the past 10years I’ve had a financial advisor consistently restructure and diversify my portfolio/expenses and I’ve made over $2.2m in gains… might not be a lot but i'm financially secure.

[@Michelle-Bennett]

I'm intrigued by this. I've searched for financial advisers online but it's kind of hard to get in touch with one. Okay if I ask you for a recommendation?

[@alex-Yolan]

My CFA ‘Grace Adams Cook’ , a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.

[@Michelle-Bennett]

I just looked her up on the web and I would say she really has an impressive background in investing. I will write her an email shortly.

[@iliketacos6067]

Thank you

[@TylerCauble]

Of course!

[@MrTornnado]

Which is hes channel?

[@TylerCauble]

It’s Hamza Ali

[@Christ_is_King951]

i need a home first

[@TylerCauble]

For sure!

[@daniels9063]

Are you currently developing these assets?

[@TylerCauble]

Yep - actively looking for more of these deals right now

[@chrism8013]

I remember build cost of $80 sqft costs for residential in NY. My god, I'm getting old!!

[@TylerCauble]

Wouldn’t that be nice today! Haha

[@edwardmiller-pp7mg]

thanks

[@TylerCauble]

Happy to do it

[@EveryStudent]

1:15 pickleball? Ha!

[@TylerCauble]

😎

[@seanodanielsart]

If it’s a great asset with such a high cap rate why sell?

[@TylerCauble]

Because you can improve it, lower the cap rate, sell for a higher price, and 1031 exchange into a better asset

[@BlackRifleRack]

People don't.

[@BlackRifleRack]

took 17 years but exactly what I did@@TylerCauble

[@rodricksage5963]

boomers had residencial, we need to make comercial our thing, open a business, make profits and sell it.

[@TylerCauble]

Love that! Let's take it over haha

[@1970broncoman]

So my question would be, how do I do this without using any of my own money.

[@chidieberechimezie2053]

private money lenders do it, i know few..

[@TylerCauble]

I've got a video on that, too: kzbin.info/www/bejne/nYS5f5hris92gKs

[@BlackRifleRack]

Best to use your own. Risky business they just might end up with your hard work. Price to pay.

[@apogeus2]

ohh boy. this is exactly what George Carlin was sayin: gas stations, dirty magazine's store, bodegas, malls and super malls, chain food and everything in between. a nation of consumers. soon it be warehouses everywhere.

[@TylerCauble]

At least they can be a nation of investors 🤷🏻‍♂️

[@apogeus2]

@@TylerCauble slight problem here: you can't eat money

[@TylerCauble]

@apogeus2 money buys food 😂

[@theboringchannel2027]

commercial real estate has tenants, along with all the problems that can come with tenants.

[@TylerCauble]

Tenants are tenants, but commercial tenants are far easier to deal with than residential

[@BlackRifleRack]

Long term leases too. @@TylerCauble

[@josephsteinheiser2902]

Triple net leases are pretty hands off for the landlord.

[@theboringchannel2027]

@@josephsteinheiser2902 not really, since you are now relying on a third party to spend their money to maintain YOUR property. So there is plenty of inspection and oversight needed, the owner is just not writing the checks, but often battling to get the tennant to spend the money they are supposed to. So far from a walk in the park.

[@josephsteinheiser2902]

@@theboringchannel2027 isn't that what CAM is for?