My Biggest Challenge as an Investor and More (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:

• Finding deals is not Tyler's biggest challenge as an investor - raising capital is. He has built a strong investor base through platforms like YouTube.

• Tyler emphasizes the importance of understanding the entire development process and learning from different trades, not just focusing on your own specialty.

• Financing, especially from banks, is a major challenge in commercial real estate. Tyler works with a few reliable lenders to make the process easier.

• Launching a podcast can be an effective way to build an investor base by developing long-term relationships with listeners.

• Tyler advises against letting a quick close compromise the due diligence process - it's crucial to still conduct proper inspections and evaluations.

• Networking through industry associations like CCIM, SIOR, and ULI can help connect new investors with others in the commercial real estate space.

• Tyler's investment strategy aims for a 2x equity multiple over 5 years, prioritizing long-term value creation over immediate cash flow.

• While Tyler has limited experience with campgrounds, he sees them as an interesting investment opportunity that requires understanding the specific market dynamics.

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:

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.crecentral.com to learn more. Welcome back to the commercial real estate investor podcast today. Back for another round of office hours. You've got questions on commercial real estate, whether it's on the investing side, whether it's on the brokerage side, whatever it is, I'm here to answer your questions now you get what you pay for. So that's always the caveat here on Office Hours. Feel free to jump into the live chat. Let me know what your questions are. We'll dive into them. Let's have a conversation around that. Today's question of the day, what's your favorite hotel project and why? I want to know. We just had a video that dropped this past week with none other than Ken McElroy himself, really excited for that one. It was a an absolute blast to go out and film that. And we had a great time out there in Sedona. I mean, he's such a great guy. It was awesome to get to spend some time with him. And if you haven't seen the video yet, go check it out. It's right now. It's titled inside Ken mcelroys mountainside hotel. It's an amazing project. Really cool. What he's doing. He didn't invest in that for the cash flow. In fact, the entire time that he's owned it, which I think is close to a decade now, hasn't had a single cash distribution to him and his partners, and that's very intentional. It's because they didn't buy that asset for the cash flow. They bought it for the legacy. And I think that there's a lot of really interesting principles that you could take out of that video, so highly recommend going and giving that one a watch. If nothing else, it's beautiful. I mean, the place is just amazing. So I know you'll have some good takeaways for that while we are waiting for questions to come in, let's dive into what I've been up to this past week. Dusted the cobwebs off and got into something that I haven't done in a little bit, really honestly, since I was brokering full time, which was speaking at a Keller Williams office. I used to go around and speak at residential offices all the time, educating them on commercial real estate, how to work with commercial real estate brokers, what they should be able to do in a commercial real estate transaction, and what they shouldn't, because those are two very different things, right? Most, like residential brokers, like managing brokers, really do not want their residential agents touching commercial real estate the I guess the highest likelihood of getting sued as a residential agent is messing with commercial real estate. So obviously they're not going to want you to to mess around with that. But it was good. So got out there, talked a lot about that. We had a lot of questions, just because of Nashville dealing with, dealing with, like, short term rentals, which, like Airbnbs, short term rentals in Nashville are an interesting concept, right? They the local government continues to work on figuring out how to police these, and I say work because they haven't really figured that out. It's been really it's been really interesting watching it. But they have, you know, recently instituted within the past couple years, a change to where the zoning has to be commercial in order for you to operate a short term rental. So of course, we were talking about that quite a bit. Let's see. So in addition to my Siri accelerator mastermind, which is my like investors mastermind, Logan Freeman and I also launched a broker's mastermind this year, and that has been a lot of fun. It's I just, I love sales so much, and sales tactics and getting down into the nitty gritty. So honestly, I'm probably getting just as much out of that as all of our students are. But we had Megan, Michael from Whataburger, on into the group call this past week. Had her come and talk on what it's like working with a big. A brand like that inside their real estate department, how commercial real estate brokers can find and work with these brand representatives, and how they can become the preferred brokers for these types of projects. It's really interesting hearing from the inside what these big national brands that have an immense amount of resources to put towards their real estate selection, how they look at things, how they go about the process, because it's very different, right? I mean, what a burger has very different requirements than Chick fil A, although they may have some overlap in the type of customer that they have and even similar stores, right? And when I say similar, I mean, you know, they're both typically single tenant, standalone qsrs with a drive through, right? So it's, it's, it's interesting how nuanced it can really get at that level. It's, it's always really interesting to me to dive into that thing. So shout out to Megan. Thank you so much for coming and talking to us at the brokers mastermind. What a great time. We ran out of time before we ran out of questions, which is always a fun thing to have. This weekend, we had a walk through at peerless mill. Y'all know that I got my approvals a few weeks ago for doing indoor climate controlled self storage. So we are working through that now. We do not need stamped architectural and engineering plans, so we're foregoing that route. I basically have the plans pulled together myself. I have selected a property management company that we're going to be moving forward with. We interviewed probably six or seven different self storage management companies before we decided which one to go with. And really excited about this team. They're actually based in Nashville, which is which is nice, right there, down the street from me. Actually, the principal lives in East Nashville, which is pretty cool. So that'll be nice. Met out there with an electrician. I don't know if it's the I'm an out of town guy. I don't know if it's I bought the old peerless mill, which is, you know, a massive project, but every quote that a general contractor gives me on that project is so far out of the ballpark of reality that it makes me question what is going on in Chattanooga sometimes. And let me put it this way, we've got an 1100 square foot office building out there that I want to finish out so that I can stay there when I'm in town, but it also serves as just kind of our drop in Cauble group offices, whatever. And keep in mind, it's, it's built out. It needs power run to it. The plumbing needs to be, you know, fixed up a little bit, right? It's, it's older, but they quoted me $207,000 to renovate 1100 square feet. To put that in perspective, I could tear that building down and build it ground up, nicer and newer than that quote. What I had in my mind budgeted was 20 to 30 grand, literally, 10 to like, 15% of the quote that they gave me. So I was like, You know what I was telling Jamal, he's my apprentice. I was telling Jamal. I was like, Man, I think we're just gonna call these subs ourselves and deal with this on our own. Because, you know, the electrician was looking at and he was like, oh, yeah, it'll cost, you know, 2030 grand, and he's got all the contacts. So it's like, you know, I don't, I don't know. Maybe, maybe I'm just getting the fu price. You know, they don't want to actually work with us. Who knows? I don't understand why contractors will go through the effort of pulling a bid together like that, just to have it so far out of reality that no one would ever, ever move forward on it. But, I mean, here's, here's the good thing about the self storage piece, you know, the the units themselves, like the metal units installed, so like this is materials, labor. Everything installed, 15 to $20 a foot, it's really all it costs. So outside of that, we just have to make sure that our mechanical, electrical and plumbing, our MEP, is in line. So that's why we're just going to call in those trades. We'll call in an electrician, we'll call in an HVAC guy, we'll call in a plumber. Hopefully we don't have to do a bathroom there because it's self storage, but we're likely going to have to and then we've got to do fire suppression as well. So it's really only like four trades,

so we'll get that going. Last night we had a one of our one of two weekly Siri accelerator mastermind calls that we're doing now. I actually recently added a second call. So. Yes, because we do them Monday nights at 5:30pm Central Standard Time, and then now we added another one at Thursday Thursday mornings at 11am Central Standard Time, just to kind of balance it out, right? I know some people are busy with schedules, and you know, since we've hit 100 students in the mastermind, I figured, let's just go ahead and add a second call. But last night, got to brag on Matt Weston and Joe a for for a hot minute, because those guys joined on july 11 and closed on their first commercial property on October 31 so on Halloween, they set the record for fastest acquisition of a commercial property after joining the group, which is really cool, so 103 days. So we've got to find somebody's got to come out and beat that now. I mean, my average student implies their first commercial property in nine months. So to put that in perspective, I mean, that's like a third of the time that it typically takes on average. So really impressed with those guys. Matt, Joe, congrats. Really, really excited for y'all. It's a great property, and as and I told them, as soon as it thaws out up in Minnesota, we'll go up there. We'll do a story of the deal. We'll do a profile on him. All right, let's dive any else questions. Let's see what we got going on here. Bama, realtor is saying this crowd is insane. Well, seeing as I'm the only one here, it is a pretty insane crowd. Joey, thank you for the orchard Canyon Resort segment show great info and very inspirational. Absolutely. Joey, that's the for those of you all that don't know, that is the hotel that Ken dead, that we did the profile on the story of the deal. It's called orchard Canyon. It's beautiful, absolutely gorgeous. I'm going to be taking my girlfriend back out there. It's a it's an amazing property to me. It's, it's such a an interesting dichotomy, because, like, when I think of apple orchards, I just think of, like flatland apple orchards. You know, their apple orchard is flat, but it's in the shadow of red rock mountains that are unbelievably steep and tall. It's really, really cool. I mean, just a gorgeous bag. I mean, come on, it made it. Made The Videography for this story. The deal so easy, like, I don't know how we're gonna top that. Man, it was great. Evan is saying, as an investor, what, what is your biggest challenge finding deals? So, Evan, that's a great question. As an investor, my biggest challenge is not actually finding deals. I mean, I have built a an incredible funnel for finding deals. More often than not, we have exponentially more deals than we could ever do. Our biggest limitation ends up being capital, and so I'm constantly having to raise capital for these deals. But really it's not even that, because, you know, fortunately, thanks to YouTube, thanks to everybody that listens to the podcast, my investor base has grown substantially, right? Because a lot of people will get into commercial real estate, and they'll say, Well, you know, this is too intense. I don't want to do this for myself. I'll just invest with Tyler. Or, well, it would be good for me to diversify my portfolio. So while I'm doing my own projects, I'm also going to invest with Tyler. There's a lot of reasons for it, and so we now have over 2100 investors on our list, which is amazing, like it's, it's kind of astounding to think about. And it's all because of YouTube. Really. It's just because I put a link in my description that says, hey, if you want to invest with me, you know, click here. I think it's, I think the link is like Tyler cauble.com/invest, so if you're listening on the podcast, that's how you find it. So it's, it's not actually necessarily even the equity anymore, because I kind of have some investors that will get mad at me every now and then, because we release a deal and it gets subscribed too quickly, and then, I mean, we do it on a first come, first serve basis whenever we raise capital, and I'm very upfront with my investors on that, hey, as quickly whoever gets the money in, the fastest gets the investment. That's just how it works. It's typically the debt banks right now are just miserable. I mean, they've always been miserable to deal with, but especially today, they're miserable to deal with for the most part. Now we do have several amazing lenders that we work with that are awesome. They understand our mission, our vision, and it makes my life significantly easier. But yeah, I mean, I would say, I would say financing is probably the toughest thing, and it just kind of always will be, right? Paul is saying, if you were to get a trade, which one would you get, and which one would be best for real estate development, if I was to get a trade, which one would you get? Paul, I'm not quite sure what the question is. I'm assuming you're asking if you were going to join a trade like electrician, plumber. McCann. Technical, something like that. Honestly, I think that any of them are equally as good for real estate development, as long as you're paying attention to what the other trades are doing and learning, right? I mean, don't just focus, you know, if you're an electrician, don't just focus on what the electrician does. Figure out what the HVAC guy does figure out what the plumbing guy does figure out what the framing guy does. All of that will be incredibly helpful as you jump into real estate development. I have seen people get into commercial real estate from all different walks of life. You don't have to have any specific background whatsoever to become a developer. Do whatever you find interesting, and just keep an open mind towards learning about development from there. Put it this way, you could be a CPA and focused more on math and spreadsheets and numbers and forecasting. You could be an architect and be focused more on design and the esthetic appeal of a property. You could come from construction as a project manager, and be more focused on, how do I make sure people are arriving on time and getting this project on under budget? There's so many different ways for you to really approach commercial real estate development, and honestly, there's no right one. There's probably no wrong one. Maybe there is, I don't know, but not in my experience, Colin is saying, in terms of doing a 1031 instead of looking for your traditional, let's say 14% return, wouldn't you instead run the number looking to beat the return on the deal the cash is currently on? That's a great way of looking at it, and calling, yes, that is true, right? That is how investors get to a point where they're buying a Starbucks at a five and a half percent cap rate and justifying those returns. So I'll give you an example. This is a deal that I actually did. Well we still are doing. It's supposed to sell here in about 30 days, but a partner and I bought a piece of land for $618,000 we both put about $150,000 each into it, right? It was 100 grand each at closing. But since then, we've had, you know, just random expenses. So call it 150 each. The property is under contract to sell for 1,000,005 50, which, after all is said and done, we pay the note off, we'll be walking away with about 1,000,001 which, you know, if you want to get really technical and subtract our initial equity investment, it's about $800,000 in profit. So we're gonna take that million one and leverage it 50% probably, I mean, I might, I might actually end up putting it into a self storage facility I'm doing, but then I could go and invest, this is how people justify buying a Starbucks at a five and a half percent cap rate, right? Because, yes, I mean, I've only got 50% debt on it. And, yes, it's, it's, you know, a million won in equity. But technically, we only put $300,000 in cash into it. So as long as we're getting better than, I mean, 30 grand a year, right? If we want a 10% cash on cash, as long as we're making more than $30,000 a year, then that's a good move, right? So honestly, like, I think when it comes to looking at deal returns, it's it's important to not remain so rigid on the percentage return metrics. A lot of investors get this hardcore, like, no, if I'm not getting an 8% cash on cash or 10% cash on cash return on my total equity invested, I'm not doing it well. There are a lot of other reasons to invest outside of cash on cash returns, or outside of internal rates of return. You know, like I'm working on a deal right now where it will personally bring me somewhere between 10 and $20,000 a month, passively, by the time that it is done,

10 to $20,000 a month. I don't care if it's a 5% cash on cash return or a 5% return on equity that I've built up into that project. I'm looking at that going, that's awesome. That gets me that much closer towards my goal. I don't need to squeeze everything and absolutely maximize the efficiency out of every single project that I do. If I can truly set this like 99% on autopilot, I will take the 10 to 20k a month, all day, even if it's half of what the return that I could potentially earn elsewhere. I think that's the thing. It's the return that you could potentially find elsewhere. If you find an outstanding home run of deal. To me, it's almost like, Man, I. How much money do you really need to feel really good, right? I mean, that's one deal that would bring that in, so I think we'll be fine. Thanks for the question. Cesar saying, Tyler, good morning, I spoke to my good friend Paul Myers. Didn't surprise me that you guys know each other made my day. That's awesome, man. Paul is a great guy. He's industrial broker over at Charles Hawkins here in town, here in Nashville, and he and I actually spoke at an event together last week. Paul's a good dude. We've, we've traded papers on a deal before. I like him. He He's sharp man. He shows up in a suit. He's the exact opposite of me, but like, that's what he's comfortable in. And I love that, right? Like, that's how it is. Dude. I mean, he's like, he's the industrial guy showing up in a suit. Most industrial guys don't show up in suits, so it makes it like he's that makes him different for the sector that he's in, right? He stands out from everybody else, and that's important, man, find your blue ocean. So, yeah, it was good. It was good getting to hang out with him. He's crushing him. Alex is saying we build self storage all over the southeast. Would love to help out. Alex, happy to chat, man, I think you've DMS me before on Instagram, but yeah, let's, let's talk. I mean, this is an indoor, climate controlled self storage facility, so we're not building ground up. And I'll be honest with you. I'm probably a tough client, just because I know what the numbers are supposed to be, and I get easily offended when people try to take advantage of me thinking that I don't, I don't, I don't know. I don't know what it is. I have no idea. Let's see Robinson. But I mean, Hey, Alex, that being said, I will also be a great client. If you give me great numbers, I'll give you a lot of business. Robinson, saying good morning. Tyler, really missed talking to you guys on the 12 weeks to break into cre was wondering if you would put mortgage contingency in an LOI, or would you just put it in a 60 day due diligence period? Robinson, good to hear from you. Man, I'm always appreciative that you jump in on these office hours. Because, yeah, we love doing the 12 weeks to break into CRA. It was awesome getting all the feedback from everybody too. We got some phenomenal I sent out a survey, of course, everybody in the 12 weeks to break into CRA program, and Logan and I need to relaunch that. I think it'd be a great idea for us to do because, I mean, one, it's a lot of fun. Two, the feedback was great. And three, like, it just serves my purpose. Now, you know, y'all probably heard me. If you jump jump in on the live streams, you've probably heard me talk about my mission now is to become the premier educational resource for commercial real estate, right? We've started that with this YouTube channel. I've started it with the brokers mastermind. I've started it with the Siri accelerator mastermind. We're going to be offering even more content options here pretty soon, which I'm pretty stoked about. So pay attention. 2025 will be fine. I mean, that's why, like, if you go to join the Siri accelerator mastermind, it sends you, you go to Siri central.com because I want Siri central.com to end up becoming the centralized location for commercial real estate education, so that'll be good. I'm excited for that. But as far as putting a mortgage contingency in an LOI, I don't typically do that. I know that there are brokers that will. I typically just have that in this. I mean, it's, it's part of the 60 day due diligence period. I try not to complicate my letters of intent, or my purchase and sale agreements with language like that, when it can be covered by something else. So because it's going to bring up uncertainty or fear with the seller, if you're going to put a mortgage contingency in there, when technically it's already kind of covered in that 60 day due diligence period, right? You can back out for any reason whatsoever during that 60 days and get all of your money back. So that's typically where I would do it. Now, if it's something that it's going to take you longer than the due diligence period to figure out, then, yes, yeah. I mean, I would, I would want to put that in there. Hopefully, it doesn't take you that long, though, but sometimes, like for instance, it depends on the negotiations. For instance, some sellers will be like, Well, hey, I'm giving you the entire financial package. I'm giving you the survey. I'm giving you the Phase One environmental you know, I mean, sometimes you get these sellers get really pretty about what they are giving to you, and it's like, Okay, that's great. That doesn't really help me with the bank, so that's fine. I'll take your 30 day due diligence period, but now we've got to have a carve out for mortgage contingencies. Does that make sense? Hope that helps. Jay is saying, Hey man, first time here. Well, Hey Jay, welcome. Appreciate you being here for the first time. Thanks for dropping by. Right? Charles is saying, Hey, Tyler, when should I go from single family to commercial wholesaling? Right now? Charles, make the leap today. Go ahead and do it. Man. It's, I mean, look, wholesaling is great. Problem with wholesaling, in my opinion, is it's this never ending cycle of, you know, you get, it's just like, it's like, brokerage, honestly, you get a cash pop, and then it's like, okay, well, you're only as good as your last deal. You better go find the next one. So wholesaling is a good tool to get you from A to B. I would keep that as your your you know, cash flow, you know, primary income gig. But I would start doing everything that you could to learn about commercial and start getting into that. Because once you start investing in commercial real estate, you'll start to realize, like, Yeah, I'll never touch single family again. I had a had a post on Instagram, go semi viral for, for for my account yesterday, about a contractor that really, like an old friend, that really messed up on a deal that I went him money on, and I had to foreclose on him and take the property back, and he went through bankruptcy that that the bankruptcy was not because of me. I had to foreclose on him because of the bankruptcy. Just to be clear, let's put it this way. There are news articles out there on this guy and how much money he was stealing from people, which I did not know about at the time. How he's not in a prison is amazing to me, but it is what it is. Captain Kurt, what's going on? Man, would you say that launching a good podcast is the best way to build an investor base after you go through your close network of family and friends? Yeah, I think a podcast is really interesting because it it just puts you in somebody's ears for a long time, right? Like for YouTube videos, people will watch for like five minutes max, right, no matter how long the video is. I mean, I think my average watch time on the channel is like five or six minutes, and so and it depends, right? Like these office hours, it's a more hardcore fan base. The average watch time on my office hours is like 10 or 12 minutes, so more than twice my channel average. But it's because, if you're watching this, it's because you're a hardcore fan of what we're doing, right? You really want to get that information. You really want to know how to get further into commercial real estate, right? But when we do a video like inside Ken mcelroys legendary mountainside Hotel. You're gonna get some people that have no idea who I am, or have no idea what commercial real estate is. They just say, oh, cool mountainside hotel. I want to see that right? And so they may click on it and watch it for 30 seconds. Whereas a podcast, typically, people will subscribe and, you know, they'll listen to 3045, 6090, minutes. I mean, I've got some podcasts where I've, you know, God bless my listeners. They will sit there and listen to me for over an hour. And which I which I do love, but I also do the same thing, right? I mean, I'll listen to podcasts for an hour. Two hours doesn't really matter, as long as the content is really good. And so I think it's a great way to build a relationship with your audience, because my listeners, like, when I meet people in person, it makes the relationship that much easier, because they know so much about me. They already know what I've got going on. They're like, we have things to talk about, right? It's really cool. We get right into the like, Oh, cool. What are you buying in commercial real estate? Right? Like it helps us just get into that conversation. I know we're only halfway through the questions. I know for a fact I'm going to run out of questions today. So sorry, guys. If, if I don't get around to your question, feel free to drop it as a comment in this video, and I will respond. Almost nobody ever does that, which I think is really interesting. But oh well. Juan is saying, Hello, sir. Do you own any arenas or music venues? No, I don't owning an arena. Sounds like it would be awesome. I am thinking about building out a music venue at peerless mill in Chattanooga. But, you know, we'll see. We'll see where it goes. Ryan is saying, so pumped. It's Tuesday. This is my favorite part of the week because of this Live Well, cheers to you, Ryan. I appreciate that. It's, it's,

it's one of my highlights of the week, too. I really do enjoy getting to jump in here and have a conversation with you guys. It's, it's a lot of fun, and I'm very appreciative of what you guys allow me to do, right? It's, it's fun to just get up here and nerd out about commercial real estate for a while. Let's see. All right, we got time for a couple more. Hey, buddy, what do you think about campgrounds? Carl, I like campgrounds. I don't know much about them. I mean, we've had we've had my buddy Dylan Marma come in and talk to the Siri accelerator mastermind about his approach to RV parks and campgrounds, and how that looks and how they make money, and how they source these deals. But it's not something that I'm proficient at. I've just never bought one. Now we've looked at building some developing some land into that. So, you know, that's I think it's interesting. I think it's interesting. I just. Know enough about it. So, I mean, just like anything else, it really, really depends. Let's see. I got five more minutes. We'll make this we'll make this work. Let's do this. Daniel, Hi, I'm a handyman cleaning service in Chicago. I want to invest in commercial real estate. And I was wondering, what networking opportunities should I pursue to connect with others in the industry? Great question. Daniel, so I love CCI M. Getting connected with brokers is a great way to get started, because they're kind of the front line in commercial real estate, right? They know everybody, or at least they should know everybody. So they're a pretty good referral base for you. So you'll meet them at CCIM, at SiO are at naop, n, a, i, o, p, I also like the Urban Land Institute. That's a great organization to be a part of. I'm trying to think of what else I see, Sc, right? Although, cleaning, well, I guess handyman, yeah. Oh, I mean, go, go join. Oh my gosh. What is the property management one? I've taken a bunch of their classes, and I can't think of what the property management group is. Man, I'm I can't believe I'm drawing a blank on that. But anyway, there is a, like a national association of property managers that would be a great one for you to connect with, just because, hey, they've got all the people that will be making those decisions for you. So Daniel, hope that helps. Man, Ryan is saying, I'm sure it depends on the deal, but how much do the investors typically get passively every month, if you're asking about, like my deals specifically? So it depends. We actually do our distributions quarterly, and the majority of the projects that I have are heavy value add. So it's it's less of an average monthly passive income and more of a pop at the end. So typically, what I'm aiming for in my investments, and you guys are welcome to just copy this playbook when you go to raise capital. What I'm aiming for is for my investors to get a two times equity multiple in about a five year period. So that means, if you give me $100,000 today, I'll hold it for five years. I mean, I'm not going to hold it, I'm actually going to go deploy it, put it to work in a project, but in five years when we sell that project, any cash flow distributions, plus your profits from the sale and your initial equity investment will be $200,000 right? So about $100,000 in profit, which over a five year period ends up being about a 20% annualized cash on cash return, or an 18 to 22% internal rate of return. So if you want passive investments, mine are usually not the best, and I'm very upfront with my investors about that. Hey, if you need passive monthly income, I'm not your guy, because I want to get in and create an immense amount of value and make people more money over the five year period. Like if you're gonna go invest in a cash flowing multi family asset today, not a chance are you getting a 20% annualized cash on cash return, unless they are really juicing the exit cap rate or doing something else there. I would just really study those numbers and make sure that you understand it properly. Joe is saying, Are there any downsides to offering 30% under list price, with cash, with fast clothes, then I can refinance later. I mean, yes and no. Right in terms of the downside I would say. I would say, like downsides are, don't let a quick close get in the way of your typical process for evaluating a deal. So that means you still need a survey, you still need a phase one environmental report, you still need to inspect the building. You still need to make sure that the title looks good, all of that stuff. So you can only close so fast in commercial real estate, in my opinion. Now, if the seller has all that stuff, then, you know, have an attorney review it, but you could probably proceed. You can get better deals that way, but you don't want to get into a deal thinking it's a really good deal just because you get a 30% discount, only to find there's a gas tank in the middle of it that you would have found if you had done a phase one, but you didn't, and so now no bank will refinance the money out of it simply because it is an environmental hazard. So definitely something to keep in mind. All right, we got time for one more. Joe is saying, Hey, I'm looking for a warehouse. I found a property that's 6000 square feet in a rural area for 550k It's been on the market for six months. I don't know if you have a question on that, Joe, but I love that. Congrats. Sounds like it's a pretty good deal. It's a really cheap price per square foot. I always love those opportunities. See what you can do with it. If you're enjoying these office hours, feel free to leave me a review on Apple podcast. Feel free to like and subscribe to the YouTube channel, and we'll catch you the next one. 8:30am Central Standard Time every Tuesday. Are you looking to take the next step toward investing in commercial real estate? But don't know where to go. Siri 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 will 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.crecentral.com to learn more you.