Finding Debt Today, How to Win with Walgreens, Assessing CRE Deals (Office Hours)

Each week, I'm going live at 8:30am CST for my "office hours" to answer your questions about commercial real estate on the show. Let's hear what you'd like to know when it comes to brokerage, investment, and development!

Get commercial real estate coaching, courses, and community to jumpstart your investment journey over at CRE Central: www.crecentral.com

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.

About Your Host:

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.

Episode Transcript:

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Are you looking to take the next step toward investing in commercial real estate but don't know where to go? Series central offers a comprehensive education and coaching platform designed to help you get started. Our online courses cover a wide range of topics, from the fundamentals to advanced strategies, ensuring you have the knowledge and skills needed to thrive in this competitive industry. As a member, you'll gain access to our exclusive online community and monthly group coaching calls, providing you with valuable networking opportunities and personalized guidance from experienced professionals. Whether you're a beginner or looking to take your career to the next level, cre Central has the resources you need. Visit www dot cre central.com. To learn more. Welcome back to the commercial real estate investor podcast live from the combo group Studios here in Nashville, Tennessee. For another episode of office hours I am going live every week, Tuesday mornings 8:30am central standard time to answer your questions are on commercial real estate. So feel free to hop in the comments. Let me know what you're working on. What you have questions about this time is for you. Couple of updates that we've got from the past week. We brought on an apprentice for peerless mil. It was a hell of a search. We had over 20 I think we had 21 applicants for the role. It wasn't an easy application. I made it very difficult intentionally so. And we narrowed it down to about two or three candidates. It was tough. I mean, I'll be honest with you, there were probably 10 or 12 people that would have been perfect for this role. But we brought out Jamal really excited to be working with him. He's based out of Atlanta. And we're going to be hopefully meeting with him out there this week to get him started on the apprenticeship so it's going to be a lot of fun. It's going to be great chases jumping in the live chat. Good morning Tyler hope everything is going well good morning Chase Good to hear from you man. Hope everything is well in your world. For those of you that are joining me live drop in the comments let me know where you are watching this from is it YouTube? Is it Instagram is at Twitter, trying to figure out which one is the most interesting for you all to see me on. We are working on financing for a deal out in Texas. And gosh is it it's difficult. Honestly, it's a lot worse than I thought it was gonna be. I mean lenders are willing to give us term sheets, but they're coming in at 50 and 60% loan to values which this deal is an eight and a half percent cap rate it's a 10 year brand new lease. Sale leaseback the deal cops out, it's just wild to me that we are having to look at 50 and 60% Loan To Loans to value. That being said, we're still talking to lenders trying to figure this deal out, we've got some time if you are a lender or no lender in the Austin area that can come in with hopefully a 70 75% loan to value on a deal like that. haven't reached out to me. I'd love to talk to him and see you know how we can pull this deal together. It is a single tenant deal. 16 acres with a about a 10,000 square foot brand new construction, industrial building. So we'd love to you know, see how we can put that one together. It's a phenomenal deal. Let's see we had a happy hour last Wednesday. It was awesome. I think we have like over 30 Something people attended. We are doing those monthly every first Wednesday of the month. So sometimes I'm not the best about throwing it out there. But if you are interested and hanging out with me in Nashville, that is a really good way to do it. Come hang out with Josephine and I we do the the happy hours every first Wednesday of the month at basics at at the wash in East Nashville. It was good time at some awesome people if you were there. Thanks for coming. I know it was a little toasty. Josephine took the inside group and I took the outside group. I don't mind the heat. Let me know if you follow me on Instagram. You see me post about my sauna every now and then. And I kind of enjoy it so we're getting better about it. Oh, looks like we've got a lot of different I mean gosh, you're watching from all sorts of different things. We've got Twitter, Sean St. Twitter, delet. Instagram, Evan YouTube, Chase, YouTube, Heather, YouTube, CRA group, Instagram. How's it going? Kristen, good to see you. Eddie is saying YouTube via Oklahoma. Jeff. Good morning, brother YouTube fun times with lenders. Jeff is working on this deal with me. So yeah, if like you say there. If anyone has any open minded lenders out there, hook us up. We'd love to talk to you. Let's see Chase says I'm moving to Mount Juliet next month brother will chase come hang out man. We've got the happy hours. Like I said every first Wednesday of the month. I've got the we do a commercial estate breakfast every other Thursday. The next one is coming up. Let's see. On July 18 7:15am at retrograde coffee, I also announced those on my Instagram. So come hang out with us. We do this, like I said every other Thursday. Raphael Good to see you, man. Thanks for jumping in. He's saying great stuff. My friend Raphael is a commercial real estate broker. He also has a podcast highly recommend checking it out. Up in Kentucky not far from it. Good to see Raphael. Rusty is saying the days of 25% down are gone. Unfortunately, that is exactly what it's starting to seem like, you know, I, in my opinion, the deal like the debt service coverage ratio at you know, a 60% loan to value is like three acts. I mean, I'm being a little dramatic, obviously, but it's high. And so I'm hoping we can find a winner that is a little more reasonable, because it's a small deal. I mean, we're talking about a $2.1 million deal, right. So you know, my balance sheet alone should be fine enough for that. To cover that for you know, Winder also in combination with the obvious lease there with the cash flow coming out of it. So hopefully, we can get that figured out. Evans saying appreciate all the knowledge on your videos. Thanks. Absolutely. Evan, happy to happy to do it. Happy to do it. John is saying good morning from Northwest Arkansas. Sorry, I'm late. John. How dare you? How dare you show up late? Not a problem at all. Man. Good to see you. Thanks for coming in from Northwest Arkansas here. Here. The market up there. It's pretty interesting, actually. Anthony's Chase is saying good deal, man. We'll be in touch. Absolutely. Gee, what's going on, man, jeez, jump into the chat he's from from my backyard here in Nashville. He is actually in our 12 weeks to break into cre class. For real estate agents that are looking to get into commercial real estate brokerage. We had our first tee coaching call for them last night. It's a 12 week program. Logan taught last night, week one, which I was in there for probably 20 or 30 minutes. Gee, would love to hear your thoughts on it. I thought it went pretty well, it was it was really cool to see what everybody was diving into. And of course, everybody that's in there, even if you're a real estate agent, you're really interested in getting into the investing side. So we had a lot of questions last night about how to get started as a commercial real estate investor too. So we'll have to be diving into that in some of the episodes. Let's see. Last night, it was obviously a busy night, we had our we had the the 12 weeks to break into care at 7pm Central Standard Time, I had my group coaching called at for the serie accelerator at 5:30pm. Central Standard Time. So I was on the phone quite a bit last night, it was one of those 12 hour days for me. But we did a coaching call on buy boxes and then dove into a few projects from from some of the students got some people working on some really interesting things, a lot of land deals, which I was kind of surprised at. So wanted to talk about that real quick. Because, you know, I think that land can be a phenomenal investment. Especially in a market like today where you know, people that own land there, they're not getting any income from it, right. So they're probably a little more willing to consider reasonable offers. But what I will say, if you're buying land, this is the biggest piece of advice that I could ever get. If you're buying land, please pay cash, please pay cash for it. Do not go out and get a loan to buy a raw piece of dirt that is not income producing. You may have the cash flow between you and your partners to cover it today. But what happens if another 2008 comes? The people, the commercial real estate investors, the residential real estate investors that got in a lot of trouble in the last major recession, the great financial crisis, we're buying land with loans and the pied piper came, right. I mean, somebody had to pay the pied piper. And unfortunately, it was the groups that were sitting on assets that were not income producing, they could no longer cover the debt service. And again, that is fine as long as the markets moving but when the market comes to a halt, tenants stopped paying rent people stopped buying real estate, you're not gonna have the cash flow to cover it anymore. You're going to lose it.

John is saying northwest Arkansas, a crazy market tons of growth in demand with three fortune 500 companies and associated vendors. Yeah, I mean, it seems like there's there's quite a bit going on in there. I'm gonna have to get out there some time I was out in Kansas City hanging out with Logan Freeman not too long ago and met a few guys from the northwest Arkansas market. And I mean, they said it was blowing up so I'm gonna have to get out there and check it. G sang it was really good talking about the 12 weeks to break in a CRA very in depth and I liked Logan's real life stories. Logan is a walking almanac when it comes to commercial real estate deals. Dude can tell you every single book that he's ever read and like go in depth on it, which is really impressive. And of course he has so many stories about deals. It's why it's great to be partnered with him on this this brokers mastermind that we're launching on October 1, this fall and then of course, the 12 weeks to break into CRA he's he's just a really awesome guy. Yeah, so let's let's dive into your questions. What questions do you all have on commercial real estate? John saying hit me up I'll give you a tour of the Northwest Arkansas Mark that'd be fun. I'd be I'd be all for it. Be all for it be a good time. But yeah, and our coaching call last night, we dove into developing your Buy Box, I think that's something that a lot of people have not spent or a lot of newer investors have not really spent the proper time on. And it's very important for you to put together a strong Buy Box because you have to have specificity in your search, not only for yourself, but also for the brokers that are going to be helping you find deals for anybody out there that you're sharing what you're looking for. They need to understand what you want. So, you know, I won't go too in depth on that today. But don't, don't say hell, I'm willing to look at anything. That's an 8% cap rate between one and $2 million. Nobody's ever going to bring you a deal. It's gonna be really tough to find something there. So there we have it. All right, we've got we've got over 30 people in the live chat y'all jump in with your questions. I want to hear what you guys want to dive into today with commercial real estate, had a video take off last night that was pretty cool to see. I don't know if it was the topic or the timing. I've never posted a video on a Monday before. So that was an interesting experiment. We posted how real estate developers make money. That is one that YouTube actually if you don't know this, behind the scenes, YouTube will recommend you videos that you should make based on what your audience is searching. And apparently how real estate developers make money was a top search. And I mean, in, Gosh, 15 hours since we posted it, it's already got 3400 views. I mean, it's it's one of the top videos we've posted in a long, long time. So really good to see that it's always nice meme at this point. I mean, guys, I think I've posted over 500 videos on my YouTube channel. The the podcast is really far behind, because I think we're coming up on you know, 230 240 250 episodes somewhere around there. I mean, you know, we've got a ton of videos on YouTube. I'm trying to catch up on the podcast, so we'll get those out to you. But you know, it's fun to see a video kind of take off like that after after you've had it going for a little while. GSA teller, can you talk about some opportunities from the Walgreens and CVS closings? What can a commercial real estate broker do to take advantage of these closings? That's a great topic. We talked about that a little bit in our office hours last week about Walgreens and CVS announcing a massive amount of closures. Across the contrary, because pharmacies are struggling, they are not getting the profit margins that they were hoping for, you know, you look at what Mark Cuban is doing and what I think even Amazon has some, you know, direct to your your front door kind of offerings now for pharmaceuticals. And so these stores are struggling. And I think over 4000 stores are closing across the country, or are slated to be closed if things don't change. So, I mean, let's be honest, those are in phenomenal locations, there's a lot of investors that are going to be in trouble. They bought those deals, they probably overpaid for them on a price per square foot basis because they thought that they would have Walgreens paying rent forever. Here's the opportunity though. If if Walgreens is itself is not shutting down, that means it can't really get out of its lease unless there's some sort of clause in the lease. So I mean, one, check the lease to make sure that Walgreens is going to have to continue paying means you're going to be dealing with dark or dark Walgreens. I would consider negotiating with that Walgreens to let them buy out of their lease early. And, you know, I typically aim for 50% of the remaining lease term. You can do whatever you want. Yeah, I mean, look as as the owner, you can say no, I want you to pay 100% Of the remaining lease term to get out of it. That's not really reasonable, in my opinion, and Walgreens is probably not going to pay them 50%, in my opinion is reasonable. Again, Walgreens may not think so. But I don't really care. I'll just let them sit there and collect the money for a few years. If you can get them to buy out early, then that gives you the opportunity to boost your IRR significantly, right and so you know, as the broker, that's what you would pitch to the property owners. Hey, let's let's go ahead and get all this cash up front. And then I'm gonna go out and find you a new tenant. You think about these stores like they're on hard corners. They're single storey, they have a drive thru. They are basically just an open box, one big open room with you know, bathrooms and an office, I mean, Walgreens in a ton of parking. I mean, what kind of business wouldn't want to take those, I guarantee you there's 100 You know, fortune 1000 companies out there that would love to start looking at taking these types of spaces. So I think they'll be relatively easily least depending on where you are in the market. But as a broker, I would start pitching these these owners of these Walgreens and CVS is CVS is a little bit different. They don't typically have as many hard corners like Walgreens do. They tend to be more shopping center strip center like in line located. But I would start pitching to those owners like hey, why don't you will come in what us negotiate a buyout with Walgreens. And then let us get to work on finding you a new tenant and seeing how we can really boost what you got going on here. I think that's good way to do it. Jeff said question out of curiosity, what's your take on buying boutique brokerages and rolling up multiple brokerages for economies of scale or to sell off? I think it's a great question. So I've actually looked into that before because I am intent on scaling the copper group, right? I mean, we've talked about this before on the show. I eventually want to have an office for the cobble group in Chattanooga, Tennessee, I want to have one and Louisville, Kentucky. I want to have one in Birmingham or Huntsville, Alabama, and then continue expanding from there, you know, Asheville, North Carolina, Charleston, South Carolina, who knows, right? I like these smaller, more tertiary style markets, especially for our brand and kind of what we do, we focus on the one to $5 million range, which is a range that, you know, the institutional investors find too small, but your average Mom and Pop can't really do. And so it's a sweet spot for our investor clients. And it's, it's tough, it's tough to buy boutique brokerages, because a lot of them are so unorganized. I mean, it's it's essentially a firm that has been built around a high producer, right? It's not really a business, you know, you start thinking about like a lot of doctor's offices, right? Like these doctors haven't created a true business, they've created a very high paying job, but it's not really a business, if they stepped away for six months, that it will fall apart, right. In most cases, there are some doctors, of course, that have totally done the opposite of that. But it's the same with most brokerages, like if the main producer steps away, and they're not running the show, it falls apart. And so in my opinion, there's nothing there to be bought, right? The value is in what the high producer or the owner is doing. And as soon as they walk away, you're not going to have that value anymore. So there's really nothing there to buy, in my opinion. So you're almost better off trying to steal, you know, they're their second third or fourth top agent, you know, behind the owner, obviously, and seeing if you can just open up an office with them. I mean, it look if you're if you own a commercial real estate, a boutique, commercial real estate brokerage in the southeast, and you want to, you know, partner up JV with the cobble group and start to expand, I mean, reach out, I'm happy to talk to you. It's, you know, it'd be tough to do a purchase, but you know, maybe there's some sort of merger or something going on there. Brad is saying more videos on developers. Thank you is a good one. Absolutely. Yeah. I mean, that's, that's one thing that we haven't done as much on this channel that I really should. The problem with development is it's so tough to really document because they take 18 to 24 months. Right? So if I wanted to show you guys a true development project, I mean, it would take us two years to actually pull that video together, which is just you get a little deal fatigue, you know, I mean, you get deal fatigue working on the development, you could, you would definitely get deal fatigue, working on the video side of things. So we'd love that. We're trying to figure out how we can do more development content on the channel. That's something that not a lot of people are doing on YouTube at all. And to me, it seems like a pretty nice blue ocean for us. So I am absolutely interested in that if you guys have ideas on the types of videos that you would like to see when it comes to commercial real estate development. Let me know in the chat, let me know in the comments, shoot me a DM on Instagram. I'm all for it. You know, as long as we're getting the feedback on what you guys want to see, I'm happy to go put those videos together. So make sure you're commenting and letting me know I do check every single comment on my YouTube channel. So if you are and I do try to respond to every single Instagram DM it gets tough sometimes, but I really do. So I want you to know if you leave a comment on the YouTube channel. I will see it I promise.

Eddie is saying great video watched it this morning. I appreciate it, Eddie. It was it was a fun one to make. I mean, I just I really enjoy that kind of stuff. John is saying can you talk more about conversions of office space to flex what type of buildings to work for challenges, et cetera? That is a great question, John. I'm actually headed down to Alabama. At the end of this month to film a story of the deal with one of my Siri accelerator students. His name is Marcus. He is actually he literally just closed last week on an 8700 square foot office space that he is converting to flex. So he has developed some ground up flex space already. And he's looking at doing more of that. But he's also going to be converting this office building into a flex development. So we will actually be diving in on a video in depth with him talking about them. Rudy is saying congrats, dude. Appreciate it, Rudy. Good to see you, man. Jeff, I'm a pharmacist and would love to take advantage of some of these if anyone ever get serious about rolling these up. Let's talk but keep in mind that will likely be a drawn out process. He's talking about the Walgreens. I agree I love Walgreens. I mean, hey, if you could get five or 10 Dark Walgreens pulled together, then you can go and negotiate with a company that take all five or 10 at the same time. I could get really interest thing over that Marcus is actually in here. That's funny, I was just talking about Marcus. He just commented Birmingham, Alabama for the cowboy group. I would love to come to Birmingham, Alabama, I have I mean, Birmingham is one of those cities that I genuinely don't understand how it has not taken off, like Chattanooga, or you know, I mean, Nashville is on a different scale. But Birmingham is really cool. If you've never been there, go check it out. They had they were booming in the late 1800s, early 1900s. And then kind of fell off afterwards and are now starting to see this revitalization. The nice thing about not booming through the mid to late 1900s means that all of the older buildings were not torn down for parking lots, they have some of the coolest buildings that you will find in the southeast. And I'm obsessed with them. I love the Birmingham market. That's probably in my opinion, that's probably more of the market that we would go to for the car group just because that fits my personality so much more than Huntsville. And he is saying wouldn't Walgreens file bankruptcy to get out of the leases probably is better to see if they will buy out before they file like you said. I mean, Eddie, that's a great question. They could certainly file for bankruptcy, that would be terrible for the rest of the company. They may be able to cut enough expenses by just shutting the stores down and paying their rent, to where it may not matter. But yeah, I mean, I'm sure they're gonna get to work on trying to buy out of some of the leases. It just It depends on their corporate structure, and really what they're trying to do. I mean, if they file bankruptcy, it's their shareholders are not going to be very happy. So it's a lot tougher to turn the ship around. But hey, I mean, they they could do it restructure, and go from there. So yeah, I mean, if Walgreens files for bankruptcy, and you're an owner of a Walgreens, you're in a lot of trouble, you're in a lot of trouble. There's almost nothing that you can do. You know what I've gone through the process of being a lender in a bankruptcy. I had a contractor that I'd known since high school, that I lend some money to, to do a to do a ground up residential home. And there's just nothing that you can do. When they decide to file bankruptcy. It's it's the most like that it's the craziest process I get while we have it in the United States. I think that is good and allows people to go take entrepreneurial risks that you don't necessarily see in other countries. But damn, is it kind of ridiculous that somebody could just go steal a bunch of money from people that saying Walgreens is doing this, this is my own personal bias. Because I went through it what somebody can go steal a bunch of money from people bankrupt themselves out of it. And you know, they're fine. It's, it's crazy. Just sighs saying moving to Chattanooga, as we speak to work at JLL. Love the lives and the videos. Josiah. Good. Good to see you, man. Chattanooga is awesome. I absolutely love it there. Bring me some tenants of the peerless mill, we would love to talk to you about it pay commissions. Patrick is saying I'd like to go from flipping houses to commercial the videos are awesome. Glad to hear it. Patrick glad you're enjoying it. And yeah, it's I mean, look, you know, you take the cash from flipping those houses 1031 Exchange into a, you know, 123 tenant strip center, and do your first deal. And you'll start to realize like, Oh, hell yeah, this is this is absolutely what I should be doing not flipping houses. I mean, look, you can make good money flipping houses. The problem that I always have with that business model, it's like, you're only as good as your last deal. You know. So now you gotta move on and do another one to do another one and do another one. And that's fine, right? Like, you can keep doing it. But at some point, you know, I would just got worried. It's kind of like what we saw in apartments, like, at some point, will you run out of inventory to renovate and flip because every house has already been kind of renovated and flipped. I know, that's really unrealistic. But that's just kind of the thing that I think about I mean, if I if I was focused on flipping houses in East Nashville, and 100 other people were, it wouldn't take us too many years to run out of business. It's kind of interesting. But commercial real estate, hey, you buy it, you put some tenants in there, you let them pay your rent every month for 20 years, and you're good. I love it. Cory is saying, Hey, Tyler been recently watching a lot of your content and considering career change to commercial real estate. Appreciate it, Cory, hopefully, you're enjoying everything. Are there differences that you look for in commercial space versus residential, when it comes to assessing a property for its viability and condition? are mostly the same items like Foundation, roof, etc? So that's a great question. So, you know, when it comes to commercial properties, you know, zoning is very important. Like if we're talking about differences between residential, right, because you're going to do physical inspections, you're probably going to do a survey, right? So let's talk about the things that are actually different. So environmental, right, that's a big one. Because you don't typically have to do environmental surveys on residential units, but you should and really ought to on every single deal you ever do do a phase one environmental. That'll tell you a lot about what's going on. You never know there could have been a dry cleaners next door 20 years ago, that has a chemical spill, and that is now impacting your property. If you don't do a phase one, then you are fully liable for it. Like that's something that I kind of want to know before I buy a property Geotechnics If you're planning on building anything, you will want to do some geotechnical, which basically is core drilling, right, they're gonna come out there, they're gonna drill down into the dirt with this giant core, they basically like pull out a tube of rock and dirt and show you like, hey, you know, three feet down, this is what it looks like. And they'll tell you exactly what can and shouldn't be built there. That's always nice. zoning, I mean, you want to make sure that the property is actually zoned for the types of uses that you want to use. Other than that, I mean, it's, it's really not all that different. Now, of course, if there's tenants in place, you're gonna have to review the leases and that and that becomes a big deal. I typically like to look at the utilities a little bit more figured out, you know, how old those are. Also like to look at, like the neighborhood plan, or the community plan for where things are headed. You know, Nashville has like the plan of Nashville, right? Which shows where everything is supposed to be headed over the next you know, X amount of years. And it's nice to get that because you understand like, Okay, well, if I buy the shopping center here today, you know, it's classy. It's kind of rundown, three tenants. But it's only zoned for a shopping center. Well, the plan of Nashville shows that this is going to be a high density corridor with, you know, three to 10 storey buildings. Okay, cool. So I could probably get this rezone for higher density, I can, you know, sit on the cash flow today, go through the rezoning. And then in the future, I could sell it to a multifamily developer for significantly more than what I paid for it. So those are the kinds of things that I like to look into when I'm getting into commercial real estate. Dylan Patel is saying the salt rents development discussion videos were unique, rarely get to hear anyone share their thoughts on boutique hotels will tell and I've got another video coming out here pretty soon. I don't know if it's, you know, this, I guess next week or the week after on salt Ranch, giving you guys an update. And we had to do a little bit editing because i Some of y'all may know, it took me two years to get my permits. And I have some feelings towards the city of Nashville and planning and zoning. And, and, you know, sometimes when we record the videos, I don't hold back. So I was like, oh, you know, just for just for political reasons, it's probably good to maybe take some stuff out. So we did leave some of it and I do share my actual thoughts on it, you'll see that it's, it's a fun update, I think it's going to be one of the better videos that we've done here in a while. And I'm loving the salt ranch project. I mean, we're gonna be doing those videos every couple months, just because there's so much going on there. And also, I'm just really damn excited to actually have it going. Jeff is saying they have enough ways to cut costs, and it starts unfortunately with people and safety. Yeah, he's talking about Walgreens. Yep. Yeah, that's typically what corporate corporations do, they'll start cutting all the jobs first, and that is kind of the opposite. Really, of what you need to turn a ship around. It's a lot harder to turn the ship around with fewer people on the horse. Right? There's a there's a good metaphor for you. Okay, Cook is saying I have some 1031 funds, what's the best place to invest and industrial? Well, that is a great question. But it completely depends on how much 1031 funds you have, right? I mean, if you've got 50 grand that I would say just pay the capital gains tax, put the cash in the bank, and then you know, go go take your time to find the right deal. If you've got $5 million to 1031 Exchange, and I would say go by, you know, an office park, right, like a flex space Park, that's multi tenant, five to 10 tenants or more. You know, I mean, look, you could get a single tenant industrial deal as well. It's pretty good. But I like I mean, pretty much anything industrial. Make sure that like the location matters. And the type of construction matters.

I think that is more important than anything else is more important than the type, all that kind of stuff. Make sure that you have 20 foot plus ceilings, make sure you have roll up doors and loading docks, or at least the potential to add loading docks. Visibility doesn't necessarily matter. Nobody cares. But make sure you have good accessibility to interstates or major thoroughfares. Because you know, again, if you're the HVAC technician, you're going to have employees coming from all over the city, and then they need to pick up their trucks and then then you need to drive around the whole city. And so being centrally located is very, very important for them. So that's what I would say. Sorry, I know that's the classic commercial real estate answer like it depends. That's the worst answer in the world. I wish I could give you more than that though. Vinnie is saying flipping houses is great, but I can't wait to get out. I don't blame you. Flipping commercial real estate is actually a lot of fun. What forced appreciation is a totally different game. I did a deal. Back in 2019. We bought an office building 12,000 square feet for $980,000. Totally vacant. We put about $230,000 into it signed 17 leases and we sold it from start to finish and under 16 months for 1,000,006 50 Just because of forced appreciation and commercial real estate that is the way to go. That's why I love commercial properties. Hold on a cap rate, you just can't do that with residential houses. Thank you all for joining me today for this episode of office hours. I will see you next Tuesday at 8:30am Central Standard Time live on YouTube. Are you looking to take the next step toward investing in commercial real estate but don't know where to go? Series central offers a comprehensive education and coaching platform designed to help you get started. Our online courses cover a wide range of topics from the fundamentals to advanced strategies, ensuring you have the knowledge and skills needed to thrive in this competitive industry. As a member, you'll gain access to our exclusive online community and monthly group coaching calls, providing you with valuable networking opportunities and personalized guidance from experienced professionals. Whether you're a beginner or looking to take your career to the next level, cre Central has the resources you need. Visit www.cre central.com To learn more