Commercial Real Estate Investing: 5 Steps to Buying Your First Property
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- เผยแพร่เมื่อ 1 มิ.ย. 2024
- // Learn how to confidently buy your first property with my investment program:
www.crecentral.com/
Let's talk about commercial real estate investing for beginners with 5 steps to buying your first property.
In fact, it’s the same investment strategy that I used in 2019 to acquire 4 office buildings here in Nashville.
So, if you’re interested in commercial real estate investing, you’re going to love this step-by-step guide.
In the video, I'll teach you how to pick your commercial real estate niche and become the expert on your chosen investment strategy, we'll cover the 5 main types of commercial real estate you can invest in, six different investment strategies that you can use (Land Banking, Development, Fix & Flip, Wholesaling, Owner-Occupied, BRRRR Value-Add), how to underwrite commercial property investments, how to put together a team to help you buy commercial properties, why you should underwrite a deal a day, and why you should make at least one offer a week!
0:00 - Start
0:17 - Choose Your Niche & Become the Expert
2:25 - Choose a Property Type
3:22 - Choose Your Investing Strategy
4:26 - Learn How to Underwrite Commercial Real Estate Investments
6:19 - Build Your Investment Team
9:13 - Underwrite at Least One Deal per Day
10:43 - Make at Least One Offer per Week
// Learn how to confidently buy your first property with my commercial real estate for beginners course:
tyler-cauble.mykajabi.com/beg...
//Invest in commercial real estate with me:
www.tylercauble.com/invest
// Join my group coaching calls, Discord community, and 1-1 coaching:
www.crecentral.com/
// Get my game-changing commercial real estate tools and resources: www.tylercauble.com/resources
// Check out my underwriting models
www.TylerCauble.com/models
// Follow along:
○ Newsletters: www.tylercauble.com/newsletter
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○ Instagram: / commercial_in_nashville
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#commercialrealestate #buyingcommercialrealestate #buyingrealestate
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This was a very well made video and you’re an excellent presenter, well done
I appreciate it! Glad you’re enjoying the videos
This is true
Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got talking about investment and money. I started investing with $120k and in the first 2 months , my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and gets more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.
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Table of Contents:
0:17 - Choose Your Niche & Become the Expert
2:25 - Choose a Property Type
3:22 - Choose Your Investing Strategy
4:26 - Learn How to Underwrite Commercial Real Estate Investments
6:19 - Build Your Investment Team
9:13 - Underwrite at Least One Deal per Day
10:43 - Make at Least One Offer per Week
I've been in a commercial real estate mastermind for 9 months and no one has explained these steps to me with such clarity. Excellent video!
I'm glad you liked it! I've been considering starting a CRE mastermind, actually haha
This was extremely helpful! Keep up the amazing work!!!
For sure! Glad you liked it
I love the channel man! And I would say my favorite I'm going to step into is hospitality industry. Thank you for the information and videos you provide
Glad to hear it! Hospitality can be a very fun side of the business to be in - especially if you’re buying / building hotels in all the cities you like to travel to 😎
Great content! And a ton of useful information provided. I feel like those that are starting off in real estate have choices of paths in general. Fix and flipping commercial real estate is on a whole other level.
Conan Fox I appreciate it! CRE absolutely is - it’s certainly more difficult and often at a higher price point, but the payday is there for knowledgeable investors.
What an energy in you man, I couldnt stop this video, ton of content and appreciate your effort to put tougher this for the world to watch and learn. appreciate it
That's great to hear - I really appreciate that!
God bless you man ! The first helpful video I've seen
Love that! Please let me know if there’s anything else we could create that would help you
Very detailed and great breakdown!!
Thank you, Rick!
One of the most helpful videos to a beginner. Thank you very much.
Love to hear that! Thank you 😁
Helpful suggestions for the new agents to build their career. Thank you for your helpful video.
Happy to help!
Excellent analysis! Thank you!!
Thank you, Rowda!
Sooooooo many golden nuggets in this video, Tyler! Thank you.
Anytime! Glad you enjoyed it
Great video and this information is top notch hands down. I absolutely love this. I’m Especially the information about underwriting the deal. Super dope.
Love it! Glad you’re enjoying the videos
Great video Tyler. Really Appreciated!
Anytime, Jaime!
Awesome video thank you so much for the help
Glad you liked it!
Thank You Tyler, your so Awesome !!!!
What is your email address?
You’re awesome!
You’re welcome to reach out to the office anytime through office@thecaublegroup.com
Tyler, great video! I am finishing my MBA and took a real estate investing elective. I agree with everyone of your tips. Thank you! -Jordi
I appreciate it, Jordi! Good luck with your MBA
Thanks for the great videos!!
Anytime, Jonathan! Glad you’re liking them
This was very helpful thanks 😊
Anytime! 😁
I learned a lot off of this! I can’t wait to apply it soon.
🔥🔥🔥
Thank you Tyler.
Anytime 😁
Great video!!!
Thank you!!
Super insightful intro to commercial investing
Glad you enjoyed it
Great content.
Thank you!
Awesome!
👊🏼🤙🏼
Thank you
Of course!
Hey Tyler! Great video as always. Do you have any insight on where to get some underwriting data/tools? I am only 22 at the moment but looking to break into the commercial side of things next year.
We get all of our data from researching the market - rental rates, vacancies, construction numbers, etc. all come from our experience in the industry. You can check out our underwriting models here: www.tylercauble.com/models
But there are other resources out there, too!
Underrated channel
Thank you! 🤙🏼
Tyler - I subscribed the moment you said the correct pronunciation of “Niche” - lol - great content!
Haha love it!
More! More! More Commercial Real Estate Videos! Please!! 🙏😂Lol
Funnell Sites haha we’ll keep them coming!
Great content loaded with good nuggets. Thank you for sharing.
Newbie here and I’m really considering CRM. Towards the end of the video, you talked about making an offer on a deal with an LOI, do you mean randomly making offers (after underwriting ) for properties of interest even before inquiring of the sellers if they plan to sell?
Secondly, how can one obtain the data for underwriting properties of interest without having the financial information of the subject property?
Glad it was helpful!
You could take either strategy with the LOIs - sending them to properties of interest before talking with the sellers works if you want to take a more shotgun approach, but you won't have as high of a hit rate as you will with in-person discussions.
If you don't have the financial information of the property, it won't be possible to truly underwrite it. You could use numbers based on your experience in the industry, like if you know what market rent rates are or how much construction costs, but best to get the financials for a true underwriting process.
Great video. Do you have any recommendations where to do ccim.? Thx
I appreciate it! They have classes all over the country - I've taken them in Austin, Chicago, Nashville, and Atlanta.
Hello. I have subscribed and been watching. Great stuff here. Question. Is or are there any resources for getting ideas on commercial construction plans or especially commercial renovations on properties? I'm looking at buying two separate properties with 6 units each. They are simple small stip office/retail buildings but they need refreshing/facelifts. I have Googled and can't seem to find any trade magazines or websites? Thank you and keep up the great work!
For sure - I would check out local architecture firms' websites because they'll often have befores and afters of projects they've done. Their websites are typically full of ideas for projects that you could do. I appreciate it!
@@TylerCauble I live in Gulf Shores. Not many firms for such a thing. I'm open to trade magazines or websites. Thank you!
Hi Tyler! Are doing classes or seminars? Let me know, I really like your presentation and easy to follow and understand. Thank you very much.
Let me know how can I reach out directly to you. Many blessings.
Hey there! I am open to teaching classes / seminars - I’m a board member for the Real Estate Investors of Nashville and teach a class there each month. You can reach me at office@thecaublegroup.com
@@TylerCauble You're amazing !!! You inspired me a lot ,I watched lots a video now . I have experience in residential and I also buid , but never invest in commercial real estate . I will visit you in Nashville .Thank you very much . Manny Blassings !
So when are next clasess goint to be ? let me know ! Tks,
Hopefully more classes soon! We’re working on a course for commercial real estate investing that we’re aiming to launch in Q1 2022 and I’ll be working on putting together other classes from there
How do create a background like that on your videos? That is amazing
We use the Adobe suite for all of our editing
I have my eye on a property that says “commercial potential” if I were to purchase it, and want to use it as commercial can it be a business write off, also can it later on be used as a residence if I didn’t want to use it as a commercial property.
Certainly possible on both fronts, but you would need to confirm with your land use attorney and CPA
Very nice !!!! Is there any way I can contact you and get some advice. My landlord may be ready to sell his property and I want to be prepared. Thanks Tyler
Hi Toni - sure, you can reach out to office@thecaublegroup.com to book a phone call
Hello! I am making the transition from Resi to Commercial, and I'm very
excited. I have a question for anyone out there has has purchased
commercial property specifically a small strip mall. Do you guys pay
yourself a salary or are you looking for a set rate of return? To give
you a for instance, I'm in the due diligence process of on a small 7
unit C Class strip mall, that needs some work and upgrades but overall in good shape
with long term tenants that's cash flowing. After all the expenses, and debt service etc,
what should I be realistically looking for income wise? Thank you in
advance.
Hey there - I don't pay myself a "salary," necessarily. We do have asset management fees built in to every investment we make, which helps cover the costs of operating the day to day of managing the asset. My upside typically comes from the cash flow, property management, leasing, or redevelopment of the site. That help?
@@TylerCauble Hi Tyler, thanks for responding. No not really. (I know I wasn't too clear before, it was multiple questions wrapped together, excitement got the better of me.) To be more specific to what I was looking for and to more the point is this. Is there a rule of thumb or a quick formula to use for evaluating a commercial deal with tenants. For instance with Apt buildings or multi units some investors after debt service and expenses look for Minimum $200 per door. I'm sure commercial has something similar, follow up question would be, what is a good rate or return for a small 7 unit strip mall? Thank you for you content.
@@jdjewellpa not a problem at all! I don’t use a back of napkin number like that. I look for at least a 10% net cash on cash return - if I can get that, then it’s worth looking into. The projects I typically acquire have 12%+ net cash on cash returns with an IRR around 18%+ over 5 years. Development is typically higher because of the risk involved. But a stabilized shopping center would be worth looking into based on my initial numbers, especially if there’s some value add potential where you can increase revenues
@@TylerCauble You are the F-ING Man Tyler! That's exactly the explanation I needed to get me through my mind hump. Now the numbers will make sense in my head when I know the min % goal I looking for. Many thanks I hope you to see your channel blow up to 100k subs soon. New subscriber!
Absolutely man! Happy to help anytime. Would love to hit 100k!
I won't hesitate to contact you soon.Learned alot from this amazing video.
Glad to hear it!
I live in a kinda rural area with a ton of vacant commercial buildings and especially old corner gas stations. It's tempting to look into buying one since there's a lot of options, but at the same time if they're vacant for the current owners why would they be occupied after I bought them?
Right now office space and even regular storefronts seem like a bad buy, since so much is moving online and to remote work. Is there any sign this could be a good buy after another year or so of price decline, then recover after a bit?
Sometimes, the owners just don’t care to fill the spaces. I’ll be honest, though - I’m not experienced in rural real estate and avoid it because of the difficult you can have with leasing. Any type of real estate can be a good buy depending on many different factors - my portfolio is almost exclusively retail and office and we did just fine through Covid
@@TylerCauble You earned a subscribe and notify from me Tyler. In addition to top quality videos you post, it looks like you always take the time to respond to people's questions on YT. Not everyone does that. Thanks.
Anytime, Darkslide! Happy to help however I can - that’s what I’m here for 😁
I'm looking to purchase my first commercial building for personal use. Or as you put it on her occupied use. Other than that, I have no clue about commercial property Investments but I did have enough sense to Google some local attorneys to see what I would need to prepare for a commercial purchase. Ironically, the advice that I was given over the phone was to depend on the advice of the commercial broker as they would know more about the specifics. I thought it would be wise and prudent to get legal advice from a lawyer that specializes in business properties versus depending only on what my realtor says. My biggest fear is getting into a building that is not compliant with the city codes or regulations or needing to invest in some type of necessary upgrade before I am able to use it commercially. I've tapped into my cities government websites to see if I could educate myself beforehand, but there's way too much information there to sift out what is pertinent to my needs. This video helped me clarify quite a bit so that I can know what to look for. Thank you so much.
Knowledgeable commercial real estate brokers could hold your hand throughout the entire process - after all, that's what they're there for. However, there are many that are good at sourcing deals and not good at the "under contract" portion of the process.
A solid real estate attorney can help immensely here, as well, and they can run a zoning check to make sure that your use is compliant with the city.
After that, I would have a contractor / inspector walk the building to check if you're codes compliant. The inspector is an unbiased third-party that will be simply providing you a report of what is going on with the building while the contractor will be performing the work and will have to do all of it to code so as to turnover the space to you in occupancy-ready condition.
I have a due diligence checklist available for download on my website when you sign up for my newsletter. It covers just about everything you need to do while under contract as far as inspections go - you can find that (and the article I wrote on the whole process) here: www.tylercauble.com/blog/commercia-real-estate-due-diligence
What is your advice: I have a 17,000 SQ. Ft, hospital grade building with 40 plus beds, 2 separate wings. 1 wing has rain damage (severe). Should I try to repair before trying to sell or try to sell as is? I need an expert's advice.
Without looking at the property or knowing your market, I would recommend making those repairs. It would make a perspective buyer feel better about the overall condition of the property to not see any issues like that when they are walking through or inspecting the site, so you’ll likely be able to get a higher return on the investment
What market is it in?? @cassandra
Hey Tyler, newbie Investor here, I was wondering, in order to secure financing on a commercial deal, would I need to be a business or entity, even if I have well seasoned investors who have expressed the ability to help with the required initial equity? Great vid man thank you!
No sir! You don't necessarily need to have a business entity to qualify for a loan, though your CPA / attorney would likely recommend it. You and any partners in the deal would be personally signing on the loan, so the bank shouldn't care if the entity is brand new or not.
@@TylerCauble Thank you! Your channel has been extremely helpful. Instant subscriber! Hoping to secure my first deal soon! 🙏
Love hearing that! Thank you, Nick 🤙🏼
I’m trying to weigh the idea that I have for a piece of property an old lumber yard building
What’s your idea?
What were the books you recommended for comercial real estate?
You can find those here: www.tylercauble.com/blog/commercial-real-estate-books?format=amp
What do you mean by "underwriting"? I've heard the term before, but not sure of the meaning you are using
Underwriting is the term for analyzing all of the numbers of a deal. Here’s a video where I dive into it more: th-cam.com/video/aBfi6rSMRmE/w-d-xo.html
Just found you on live BP great interview, wish I knew you a few months ago, a wonderful downtown was available for sale thru foreclosure $4mm we could been hub for North, the rest of Nation to come thru. Special needs, seniors, college, re-entry and other transitional programs plus arts medical and education hub. I'm disabled vet, timing and help. Also missed Spanish hotel and mansion wanted for seniors, 2 small apt plus my 🏦 sold and Chipotle rents CRE, sad always wanted one to train highschool about Biz. Some is us is about solutions not * the deal *
Glad to hear that, Indira! Hope you enjoyed the interview with David - he's the man
Hi there , i live in Los Angeles Ca, i know houses here have gone up in prices for the last 2 years , has offices space gone up too or is it a different market? I would like to buy a small building about 1200 to 1600 sqf , and have been looking around but I don’t know if prices have gone up also and should wait ? Is it a different market office vs houses ? Thank you
Hey there - I would imagine the office market has gone up, as well, but unsure with COVID. I would recommend calling a local office broker and having a discussion with them about it 🤙🏼
@@TylerCauble .Thank you sir.
Anytime!
Is this the same method if you plan to hold your commercial property long term?
Yes - you could certainly hold a property long-term this way. Check out my video on the commercial BRRRR for the best way to hold long term (in my opinion, of course) th-cam.com/video/vtierPxTxEU/w-d-xo.html
What are the prerequisites for gaining CCIF?
Do you mean CCIM? If so, you just need to take the classes and have some experience in commercial real estate. They do have a portfolio portion of the class where you have to meet certain requirements to get your pin but you don't have to have those requirements in order to take the classes.
I am looking for office building for my practice ! I am new for commercial office building investment! Where do I start ?
Awesome! Great question - here are a couple of videos I did on finding your first property: th-cam.com/video/4IuMITVLmgA/w-d-xo.html
th-cam.com/video/pyGxYd0L_Ko/w-d-xo.html
So I can invest in commercial real estate to buy and build the business I want? I've started a business plan for my cat hotel business and I'm just learning how all this works. I hope I'm not overthinking it but it's all so confusing. I'm determined tho!
Yes - you absolutely can. You’ll usually get better loan terms on owner occupied properties, too
@@TylerCauble Awesome! Thank you for this GOLDEN piece of information! I was so worried how on earth to get property and to get the money for it. I will surely do some more research into this!
Love it! Glad to help - let me know if you have any other questions
Can you do a video on wholesaling commercial properties?
Absolutely - been thinking about doing that for a bit so happy to throw one together soon
@@TylerCauble Preciate it brother 🙏🏿🙏🏿
Absolutely! 👊🏼
I’m very interested in investing in commercial real estate. Do I need a real estate license first or can I just start off with CCIM?
It may be best to spend some time learning about the industry before heading over to take CCIM classes. If you have some base knowledge, then yes - I’d recommend the classes
@@TylerCauble thank you for your time and advice.Grateful!
What does underwrite mean in the US vs South Africa?
It means the same thing in both countries, I believe. You’re just running your analysis and checking the numbers to make sure the project makes sense.
Here’s a video explaining further: th-cam.com/video/aBfi6rSMRmE/w-d-xo.html
Where to get the CCIM?
Kaleb Hebron Goodwin great question - you can go to CCIM.com and they offer online classes as well as in-person. Highly recommend in-person if you can do it!
Next question what’s your PR on raw bench and squat
Amazing 😂
Bench 4 rep PR is 308
Squat is somewhere around 350 or so for 3
@@TylerCaublebeast mode bro keep up the good work/videos
Can you please share and excel to underwriter a deal
Of course - you can get all of our underwriting spreadsheets here: www.tylercauble.com/resources
What does he mean about underwriting? Just analyzing?
Yep - that’s exactly right. Using spreadsheets to take into account all of the rents, expenses, etc to determine if a deal works. You can see how we do it here: th-cam.com/video/aBfi6rSMRmE/w-d-xo.html
Do you know any coaches who can help me buy land for commercial use ?
Are you looking for someone to coach you through the whole acquisition / development process? If so, shoot me an email and we can send you our coaching package office@thecaublegroup.com
What commercial lender do you us
Almost every lender we use is local to Nashville for our projects. I haven't had any luck with national / regional lenders because they have a very different set of project criteria. Hope that helps!
I have a question. How do you professionally decline working with a real estate broker? I have a co-worker / Associate who does Real Estate work but he's not a commercial real estate expert.(He says he does both 🤔🙄)
So far we've talked on the phone a couple of times about a property I'm interested in. But I'm not 100% confident in moving forward with him. No contracts have been signed. But I feel some type of obligation( we've been co-worker for years).
What's the best, professional way to walk away from this type of relationship? Since he knows me he might "cut me a deal" so to speak, but I'd much rather work with a company who specializes in what I need even if I have to end up paying more. But not too much more hopefully!
Great question - it's definitely one you want to handle carefully. There's nothing wrong with working with a broker that specializes specifically in your niche - in fact, I turn clients away all the time that don't fit exactly what we do since I know our team just isn't designed for that type of business. Of course, I'm always sure to point them in the right direction.
If there's nothing signed, you have no responsibility to him legally. That said, you certainly want to maintain a relationship with him. It wouldn't be too much to ask your new broker to pay your coworker a finder's fee or a referral fee. It's not much and it could help your coworker accept the fact that he won't be working on the deal.
Is this property one that he brought to you or one that you brought to him? If he brought it to you, professional courtesy would be to continue working with him on it. If that's the case, you could still ensure that you're protected by having a commercial real estate attorney handle the negotiations and contracts.
As far as "cut me a deal" goes - his fees get paid by the landlord / seller, so you wouldn't be responsible for his costs unless his intent with that comment is to give you a portion of that commission back (which would likely put him in violation of his real estate license, depending on the local rules and regs).
Does that help?
@@TylerCauble Excellent response to this question!
Do you get mortgage for buying?
Yep, you definitely can
How are those offices working out for you bro?
Going great - maintaining 90%+ occupancy and 100% rent collections. Just bought another office on Thursday and incorporating more office space into a 60k sf mixed-use development we’re working on. Highly recommend office 👌🏼
Hey sir I'm 15 years old and I want to commercial real estate but I can't understand you vedio. Can you help me
Hey there - check out this playlist on commercial real estate investing for beginners th-cam.com/play/PLazYpggTiSSUNTMrvl4s1RCDcwQcL6sGS.html
Do you offer CCIM course?
I do not - you have to take those directly through the CCIM Institute
What kind of commercial real estate do you prefer to invest in? Leave a comment below!
I’d love to invest in warehouses! Can you recommend some learning resource on that subject?
Hi Wesley - we have a few blog posts on my website about industrial real estate and various industrial products. Feel free to email me and I’ll get you those links and intro you to our industrial expert on our team so he can help with any questions! tyler@thecaublegroup.com
I haven't started yet, but I'm leaning towards either multifamily or storage facilities, since those are things that will always be needed!
Both awesome choices! I don’t personally have any storage units, but my friends that do love them because you get many of the pros of multifamily without the cons
Solid choice - certainly a favorite in the world of syndication
Nice channel man... Very detailed information. I had some questions about commercial real estate I wanted to run it by you. Can I send you an email?
Happy to help - shoot me an email at office@thecaublegroup.com and I’ll send you some information on our consulting package
I love the beard
Grew it myself 🧔🏻♂️
so basically get everyone else to do all the work, make these connection
Hire the experts while you learn. Work smart, not hard
@@TylerCauble I made a connection a while back but thought nothing of it. After watching your video I sent him an email. First step.
Nice! Having a great attorney was the first big step for me. A contractor or broker might be your next best connection
Would you chose your property type before your area ?
You certainly could! It just depends on your goals. You may want to do a bit of market research on both fronts before deciding either piece
He has a beard. You can trust him
Truth
Yawn
Sneeze
I've just launched a FREE crash course on commercial real estate investing for beginners. Check it out at www.tylercauble.com/course