How to Find Commercial Real Estate Deals
How to Find Commercial Real Estate Deals
The Beginner’s Guide to Finding Commercial Property Investments
As a commercial real estate broker, investor, and developer, I get asked by new investors all the time:
How do you find so many investment opportunities? There aren’t any deals out there!
And, for most investors, that statement is true.
Investing in commercial real estate can be a lot of fun and it’s certainly rewarding, but coming across a good deal is often the most frustrating part of this process.
From what I’ve seen, however, most investors simply don’t take the right approach.
Here’s my beginner’s guide to finding commercial real estate deals.
First, Prepare Yourself
If you’re not taking the right approach when it comes to starting the search, then you’re already behind.
You can’t just make a post on Facebook, announce what you’re looking for once at a real estate investors event, or tell the occasional real estate agent you come across.
Finding your next investment opportunity needs to be at the forefront of your mind.
Make Your Search Known, Then Make it Known, Again
Like I said - announcing it once then throwing your hands up in the air in defeat when no deals fall in your lap cannot be your strategy.
Some of the most successful real estate investors I’ve ever met reach out to their database on a consistent basis to let everyone know what they’re hunting for.
In fact, I knew a prominent single family investor in Nashville that asked just about every person he came across how much money they’re looking to invest in real estate, regardless of if they’d expressed interest in it or not!
If you never ask, you’ll never know, and if you don’t become your own evangelist first, no one else will.
Be Curious About Every Opportunity
You never know what you’ll find in a deal that others have simply missed.
Be prepared to turn over every stone - just because something has been sitting on the market for a while and “everyone has seen it and passed on it” doesn’t mean there isn’t opportunity there.
Underwrite every opportunity that comes your way because they could be few and far between depending on your investment criteria.
There’s an old mantra in real estate that “you have to comb through 100 deals to find 1 that fits,” and there’s certainly truth to that statement.
7 Ways to Find Commercial Properties
Looking for commercial properties?
Whether you’re an investor, broker, or business owner, here are the 7 best ways of finding commercial deals:
Commercial Brokers
Commercial real estate brokers are likely your best option when on the hunt for commercial property since they’re doing some, if not all, of the other methods I’ll list below.
Brokers are paid commissions on deals that they source and close, so they’re highly incentivized to keep their ear to the ground for available opportunities.
The world of commercial real estate is often shrouded in mystery since there is no single database that maintains, tracks, and lists all of the available opportunities like you’ll find with the MLS in residential real estate.
So, these brokers work their hardest to keep a running list of any current and upcoming availability so that they can work to pair buyers and sellers together.
And, if you’re the one buying a property, their commissions are charged to the seller, so you don’t even have to pay for their services.
Networking
Again - since there’s no database, you’ll need to work on your own.
Get to know other real estate owners in your neighborhood or the area you’re looking to acquire property in by networking at industry events or neighborhood meetings.
Let them know that you’re on the search for commercial investments.
The more eyes and ears you have out there working for you, the better - you simply never know when something will come available. I’ve seen property trade hands off market like this many times before - the buyer met someone at an event that just so happened to be interested in selling something.
Social Media
Social media is essentially a digital bulletin board - take advantage of that!
Not only can you post what you’re searching for on your page, you could also share it with likeminded groups where you’ll find potential sellers or individuals that know other owners willing to sell.
There are countless numbers of groups online, from Facebook to Bigger Pockets, where you can broadcast your search to the public.
Social media is one of my favorite methods for getting ahold of a decision maker, especially if a business owns its own location, since the ownership or a manager is often running their social accounts.
Cold Calling
“Cold calling is dead!”
For some cases, it certainly is. But if you’re looking to get ahold of a property owner, it can be a direct path to the seller.
You can find telephone numbers for the property owners by scanning White Pages, checking out their website, or connecting with them through social media.
LinkedIn is ideal in this scenario since contacts will often have their phone number on their profile page after you’ve connected.
Then, call on them and just ask if they’re interested in selling the property. They may not be interested in selling at that time, but situations can change rapidly, so have them keep your number just in case.
And don’t forget to follow up!
Mailers
Snail mail is definitely the sleeper in this group.
Most investors (and people in general, for that matter) don’t even think to take advantage of this method.
It can be impossible sometimes to find the proper owner in commercial real estate since these ownership entities are often hidden behind the barriers of an LLC or through the office of a real estate attorney.
However, tax records have mailing addresses for the ownership of every property, so if you send a certified letter, you know your message will be delivered to the right person.
Physical mail has also decreased in popularity since the advent of email, so send those letters and postcards to owners and yours may be one of the few pieces of mail they receive regularly.
Drive the Market
Sometimes there’s no better way to find investment opportunities than driving around in the market.
I keep an eye out for properties that look as if they’re falling apart, the landscaping hasn’t been cared for in quite some time, or the oldest building on the block.
More often than not, those owners either live out of state or they may not have the wherewithal to maintain the property, which could mean a buying opportunity for you.
Get out, knock on the door, and speak with the owner if they’re onsite. If not, follow up with a cold call and a letter!
As a real estate investor, you should get in the habit of driving your market as often as possible. Not only will you continue to increase your familiarity with the neighborhoods you’re looking to buy in, but you’ll also start to recognize which properties have changed ownership or which pockets seem to be gaining traction.
Online
The internet could be one of the easiest ways for investors to find potential investment opportunities.
While there is no single database with information, you can browse different websites that allow brokers and sellers to list their properties for sale.
Be sure to check the MLS, CREXi, and Loopnet to see what’s out there.
Keep in mind, though, that these websites often have outdated or incorrect information, so you will have to do a fair amount of research on your own before making any decisions.
Is there a large boutique brokerage in your city? Like my firm, The Cauble Group, they likely have a page on their website like our Nashville Listings directory that showcases their available for sale and for lease properties.
Don’t forget to check Craigslist, either - I’ve been surprised by properties that pop up on there every now and then.
Pro Tips for Finding Real Estate Deals:
Be clear about your needs. What are you looking for in an investment property? How much income do you need? What type of zoning is required?
Set a budget. How much are you willing to spend on investing in real estate?
Consider the location. Where do you need your property to be located? What are the visibility and accessibility considerations?
Do your research. Once you have a good idea of what you are looking for, start doing your research. This includes looking at online listings, talking to brokers, and driving around commercial areas.
Be patient. Finding the right investment real estate can take time. Don't be discouraged if you don't find the perfect property right away. Keep looking, and eventually you will find the right property for your needs.
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About The Author:
Tyler Cauble, Founder & President of The Cauble Group, is a commercial real estate broker and investor based in East Nashville. He’s the best selling author of Open for Business: The Insider’s Guide to Leasing Commercial Real Estate and has focused his career on serving commercial real estate investors as a board member for the Real Estate Investors of Nashville.