373. Is Market Uncertainty Actually Good for Commercial Real Estate Investors? — Office Hours

Is Market Uncertainty Actually Good for Commercial Real Estate Investors? — Office Hours

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Everyone's watching the tariff headlines, the stock swings, the Fed drama...and deciding to wait. But here's what the data actually shows: real estate prices went UP in 7 out of the last 9 U.S. recessions. Market uncertainty isn't the obstacle. Waiting for it to go away is. In this week's Office Hours, I'm breaking down exactly why the current market environment might be one of the best setups commercial real estate investors have seen in years — and what you should actually be doing right now. We cover:

• Why commercial real estate doesn't behave like the stock market (and why that matters)

• The 3 gifts uncertainty hands every CRE investor right now

• What Blackstone, life insurance companies, and institutional capital are actually doing with their money

• The historical track record: what happened to real estate during every major recession

• Your concrete action plan for the next 6 months

The people who act in the next 6 months will look back at this moment the same way 2020 buyers look back at that spring.

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

Key Takeaways:

• Uncertainty is a buying window, not a stop sign.
  There’s always a scary headline (dot‑com crash, 2008, COVID, rate hikes). If you wait for certainty, you end up buying when everyone else does and lose your edge.

• Commercial real estate beats stocks on control and predictability.
  Stocks are volatile, reprice on headlines, and you have no control. CRE has long‑term leases, more stable cash flow, and you directly control the asset.

• History favors real estate in recessions.
  In 7 of the last 9 recessions, real estate values rose. Today’s conditions do not resemble 1991 (S&L) or 2008 (subprime), which were the main exceptions.

• Today’s environment makes existing assets more valuable.
  High tariffs, high rates, and high construction costs are crushing new development. Less new supply means existing buildings have more pricing power over time.

• Big money is already buying.
  Institutions like Blackstone and life insurance companies are increasing CRE exposure. They’re using uncertainty to buy, not to sit on the sidelines.

• Strategy now: be conservative but active.
  Underwrite with today’s rates, stress‑test deals, focus on necessity‑based assets (strip centers, flex, self‑storage), build a big deal pipeline, and deepen your education and local relationships.

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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.

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Episode Transcript:

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This

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episode of the commercial real estate investor podcast is brought to you by my cre accelerator mastermind, where you'll get access to my step by step investment blueprint, essentially a library of resources on how to invest in commercial real estate. You'll get connected to a supportive community of other commercial real estate investors that are doing projects just like you. You'll get personalized coaching and feedback from me every step of the way. Go to www.crecentral.com

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to learn more

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real estate prices went up in seven out of the last nine recessions, and today, I want to talk about why now might be the eighth time

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we're gonna be diving into market uncertainty. Is it actually good for commercial real estate investors? There's a lot going on in the world today, and will that impact commercial real estate as an investment? How is it going to impact what you are planning on doing? Should you buy now? All of that and more will be covered in today's conversation. Welcome back to office hours. This is where I go live on the commercial real estate investor podcast. Your host Tyler cobble here from the cobble group studios in Nashville, Tennessee, to talk to you guys about commercial real estate. What I'm seeing in the market, we answer your questions, so if you have questions, feel free to drop those in the live chat. I will get to them as soon as we get through today's presentation. So is market uncertainty actually good for commercial real estate investors? Well, the headlines are terrifying. I get that right, especially in today's market, we're seeing tariffs up, you know, steel and aluminum up 50%

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and that's not the only thing we're seeing. Lumber that way we're seeing, I mean, my the furniture in my hotel. I spent about $150,000

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more on tariffs on that to get that here. Unfortunately, there's not a lot that you and I can do about that, but that is certainly a self inflicted wound.

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The stock is swinging. The stock market is swinging all over the place. The S and P is volatile day to day. The Dow is over 50,000 now it's not I am actually pretty grateful that I don't have as much of my fortune in

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the stock market as I do in commercial real estate. We'll talk about that here in a minute. But the volatility is the biggest thing. I am actually pretty glad that I don't have to see my net worth going up and down every single day and dramatic swings, which is, which is kind of nice. There's a lot of recession talk. You know, we have conflicting economic signals as to whether we are, are we in a recession now? Are we headed towards one? Are we maybe trying to recover from a recession? Have we been in one already? And nobody's really been willing to admit it.

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And you know, when you have interest rates and rate uncertainty like what we're having right now, you know, the Fed has essentially said they might lower interest rates one more time this year, and we're only four months into the year,

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they're already saying we might have one rate drop. That's it. But that all comes down to inflation, and unfortunately, this past month, we had very high inflation.

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I think that it was up 3.3% year over year again,

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or higher than what it was. I don't know. Either way. It missed the targets, and it was higher than what everybody wanted it to be. So the Fed, unfortunately cannot lower interest rates or should not lower interest rates in an environment where inflation is growing, because it's actually going to just hurt everything. All right. So most investors have this instinct right of maybe I should just wait until things settle down. All right, I'll wait, and then I'll buy.

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I'll wait for all of the uncertainty to pass us. I'll wait until things are a little bit better, and then I will go and buy. The problem with that is that there's always a reason to wait,

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and I'll tell you this, it's never a good one, right? Because here's the thing, if you are waiting until everybody else is comfortable with moving forward and buying real estate,

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you're going to be competing against everybody else. All right, certainty never comes. I mean, let's, let's go back through the times, right? There's always a reason to wait. There's always a reason for you to never, ever buy real estate.

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2001 we had the.com crash. Ah, I just lost my fortune. Or, you know, hey, everybody's losing money on this whole internet thing. We should hold off on buying real estate. 2008 we had the housing.

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Crisis

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as Yeah. I mean, that is what it is, right? Most of us live through that. It was pretty wild, you know, the housing crisis. You know, real estate is doing very poorly. We should definitely not invest in it.

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Now. 2011 we hit the debt ceiling. Oh, man, the country's running out of money. We should wait, you know, who knows where things are going to go. 2016 we had election chaos. And honestly, I think you could say 2016 2000 22,020,

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2020, 24 I think every election is chaos. Now maybe it's just because I'm getting older, but I feel like it didn't used to be that way. But again, I mean, I was in high school and college, you know, back when, Obama got elected, we had

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the global pandemic in 2020 that was a great reason to wait, right? Oh, the world's coming to an end. What's the point in owning real estate if it's over 2022 we had massive rate hikes. You know, we went from historically low interest rates to, you know, overnight, 7% 8%

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and today, of course, like we mentioned earlier, tariffs, uncertainty. Will the rates drop? We don't know. The people who waited for certainty in every single one of these instances missed every single one of these buying windows. Imagine if today you could go back knowing what you know now, and buy commercial real estate in 2008

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Imagine being able to go back to 2020 not even that long ago, go back to 2020 knowing what you know now, especially with where inflation has been, because commercial real estate is such a phenomenal hedge against inflation,

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If inflation is going to be out of control, it is a great time to own commercial real estate,

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because it's a hard asset. As inflation goes up, you'll be able to raise rents. The value of your property goes up, but you've locked in that debt. It's fixed.

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So the nice thing is, it starts to outpace the amount of debt that you have on the property. All right, commercial real estate doesn't work like the stock market. This is a little bit of what I was alluding to earlier. And thank God it does not stocks. They reprice in seconds on headlines. I mean, you can get notifications on your phone all damn day about you know, the Dow is up, the s and p5 100 is down, you know, Apple is up, Tesla is down, whatever it is.

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And you know, you sit there and think about how that impacts your psyche. If you're not a professional

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stock investor, right? Most of us are not we're just casually investing into the stock market. You

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have no control over these assets, right? I mean, let's be honest, the CEO of a company could go out and commit fraud, like what happened with Enron back in what was that 2006

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around then, give or take,

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they were like a darling on Wall Street, and then go out and commit all this fraud, and overnight, the value is wiped away. You have no control over that. If that happens or not, dividends can get cut overnight, all of a sudden, you have a higher interest rate environment. You have a lot of market uncertainty introduced. And now these companies are going to decide, hey, we can't pay dividends anymore. We need to hoard cash. So if you were depending on that cash flow, you're in a tough spot now. And

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here's the thing about the stock market volatility is the default, right, which is really interesting. I mean, you see a lot of what's going on today, and it seems like people who are in power are intentionally causing the stock market to drop substantially so that people with money can buy at a discount. It goes back up, they sell, and they repeat that process again. So the volatility is almost the standard. That's what people who professionally invest in the stock market want. I mean, because here's the thing, if the stock market is always going up, if there are never dips, there's never a value, like a value added time to buy, right? So I don't know, maybe that's my conspiracy theory take on the stock market, but if you look at the history of it, it certainly seems like there's something to be said for that commercial real estate. On the other hand, you have these long term leases, you're you have locked in income. So it doesn't matter what's happening day to day. We're talking about what's happening over the next three to five to 10 years, 15 years, and even then, we've got the locked in income, right? You know, we're working on a lease right now for a Pilates studio in my office building here that they'll sign a lease for four years, and then they have a six year extension after that, I don't

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have to worry about it for potentially 10.

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In years,

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you also control the asset directly. I mean, the great thing about this is that you get to decide what happens to these properties on a day to day basis, right? You don't like the landscaping you get to change it. You don't like the management you get to change that. You don't like the color you get to change that you don't like the tenants you get to change that you have 100% control over anything and everything that happens.

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You want to

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you want to have, you know, distributions to you and your partners, or just to you. You get to pay yourself. You want to keep the cash in there, just in case you have any unexpected expenses come up. It's all yours. It's your money. You get to control it. And the great thing is, look, tenants pay regardless of news. It doesn't matter if the s, p5, 100 is down, or the Dow is up, or whatever is going on. They have locked in and committed to three, 510, year, 1520, year leases, in some cases. So they're going to continue paying regardless of what what's going on in the market. They're not going to call you and say, hey, you know, look, my,

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you know, Samsung dropped substantially today. The stock did, and I, you know, I'm going to have to renegotiate my lease. It doesn't work like that.

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And of course, there's certainty in uncertain markets. You know, when you have these long term contracts commitments, I'm

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not saying that there's not going to be a scenario where the market goes down and, you know, maybe consumer sentiment is down, like we see a little bit today, and people aren't spending as much in retail stores, and then you have to work with those retail shops on rent abatements to keep them there and keep the doors open for a little bit. Sure. That happens all the time. We had to do that during covid, and fortunately, we still collected 97% of our rents during all of that, right? So yeah, of course, you're gonna have to work with people sometimes, but it all comes back around, which is nice.

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Biggest thing is your tenants aren't calling you when the market drops, all right? They have no reason to call you.

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They want to focus on running their businesses. So here's the thing, if the Dow drops 800 points, your rent is still due.

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The rent is still due. Long term leases create income certainty, even when the macro picture is blurry. This is what separates real estate investors from what I like to call stock market gamblers.

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As a real estate investor, you actually have

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a pretty fair amount of control over what is going on with your investment. You I mean, you really do. You can treat it like a business. You can have a plan. You can execute that plan, and you can have an impact on the value of the property, on the leases, whatever it is, if you're investing in the stock market, you're gambling, really, I mean, yes, we have, like, historical numbers that we can run out over decades to say, Okay, well, on average, on average, the stock market returns 10 to 12% per year. The problem with that is it will it will be 20% in some years and substantially negative in some years. And if you are going into retirement, like many people were, in 2008 and all of a sudden, the stock market loses 34% of its value, or whatever it ended up losing, you know, overnight,

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there goes your retirement. You're gambling. You had zero control over whether that happened or not.

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And I just, I don't like taking those risks. I mean, I like taking risk adjusted, you know, returns. I prefer risk adjusted returns. I don't think that the risk. And, look, maybe I'm just not as educated on the stock market as I should be, but I don't like not being in control of that kind of stuff. Man. Look, when I get on an airplane, I wish that I was the one flying the airplane, right? I prefer to be the one driving the car. I just, you know, like being in control.

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So here, here's the here's the mentality that you should have in a market like today, when everyone is sitting out, you are moving in, you are actively looking for what the opportunity is. Like this. This is Warren Buffett strategy, right? When everybody is scared, he loves to be looking for the opportunity when you're you know, when your best friend's grandmother starts talking to you about how great the real estate market is probably a pretty good sign that it's overheated. And, you know, it's time to start selling some things. All right, it's sitting on cash.

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So number one, there are fewer buyers at the table today than what we saw several years ago, when the market was, quote, unquote, doing well, right? Here's the thing, you know, I've always thought this was funny, like, you know, from an outsider's perspective, when the real estate market is hot and everybody's talking about it, like, what has been going on in Nashville, you know, for over a decade. At this point.

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Point. People are like, Oh, you're in real estate. It must be great. It's like, well, yeah, it's it's great. Like, everything's going up in value. There's lots of demand. The problem is there's more competition. There's people that are driving at prices. We have groups coming in from out of state, from out of country, that are willing to pay more than what we feel like makes sense, and so it actually makes it tougher to get deals done. So today, with fewer buyers at the table, you have less competition. That means there's no bidding wars. You're not getting into these scenarios where something's going for 100 250 or a million dollars over asking right? You can actually take your time, make smart offers, make sure that the projects work for you instead of getting caught up in this feeding frenzy of sharks. That means better pricing. In terms, sellers are willing to negotiate more in today's environment than they have been in years, and they should be, because yes, can they refinance sure it's probably going to be a higher rate than what they currently have, or it may just be less favorable terms than what they currently have. They don't have as many options of people to sell to. They don't have buyers, you know, tripping over themselves trying to acquire these assets. And so when buyers are scarce, sellers start to negotiate more. Maybe they are willing to consider seller financing. Maybe they are willing to consider a drop in the price.

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Maybe they are willing to consider throwing in that 1971 f3, 50 that you really love that's on the property. Who knows? Get creative. That's the fun part about times like these, you can get creative. Every deal can become more favorable when you are negotiating as much as you can, and sellers are willing to negotiate today.

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And third, you've got more negotiating leverage as a buyer, right? Motivated sellers need exits. They don't have the option. And that's not just saying, like, hey, maybe somebody today, you know their loan is coming due and they've got to refinance it. Sure. Of course, that happens all the time. But people retire, people move, people sell their businesses. There's always something going on. There's always a reason for someone to need to sell today, right? And so if you're the person that's coming in, and you're providing offers at prices that work for you, at terms that work for you, you know, last night on the on the accelerator mastermind call, we were talking about a deal that Paul and Harris, a couple of our members out of Charleston, were looking at that has kind of come back around, right? They were initially looking at it, the numbers didn't really make any sense. We waited off on. It said, Okay, well, you know, if the numbers don't make sense, there's no point in trying to force it. Well, the seller came back, and now they're willing to negotiate seller financing. I mean, it's not even been 30 days, right? We're in an environment today where sellers are often quickly realizing they don't have as much leverage as what they probably wish they had. The best time to sell was 2021 the next best time to sell is probably going to be a year from now, right?

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So amateur investors are on the sidelines, waiting for permission, uncertainty like what we are seeing today, as long as you are following the fundamentals and you are making sure that you are doing your due diligence, you are doing the work, it doesn't mean that it's easier to buy today, or that just every deal is a deal. You still have to put a lot of work into it, but that's your green light, the uncertainty that is your green light in moving forward and making these projects happen, right?

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New construction today is getting absolutely decimated. By the way.

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It's been really wild to watch.

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That means that existing buildings are just more valuable. There's not as much new product coming online in the market. All right.

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So, according to JP Morgan, we see, you know, 50% tariffs on steel, aluminum and copper, all metals that are essential for building commercial buildings.

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37% drop in new retail construction in 2026 according to Colliers, a 3.1%

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decline in private construction in 2025 according to the Altus group,

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all of that combined means it's way too like you throw in interest rates on that. Construction costs are too high. Interest rates are too high. Land costs are too high, and honestly, like we've underwritten some multifamily, ground up development deals for investors, where even if we got the land for free, we couldn't make the numbers work.

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So sometimes land pricing doesn't even matter.

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Less supply means that.

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It, the current existing buildings that you own or that you want to buy will continue getting more valuable,

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because you're not competing with all of these new buildings coming online, and now, all of a sudden, you go from having, let's say, seven flex buildings on your street to 30. No, you might go from seven to 10. Well, there's still a lot of demand for those buildings, which means your rents get to keep going up. You have more leverage as you come up for renewals, because the

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tenants need the space. They don't really have any other options. Yours happens to be there, right? That's a great position to be in as an investor.

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Now, I mentioned this earlier. Seven out of nine recessions saw real estate prices increase,

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the only two exceptions, which I thought were pretty interesting, 1991 the savings and loan banking crisis, which was caused by banks, not by markets. In 2008 the subprime crisis, which was caused by real estate itself,

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right? So in any other recession where real estate basically wasn't the actual problem,

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real estate values went up, and honestly, like, if you would go market by market, even in 2008

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real estate went up in value. In some markets, Nashville, it went up like one to 3%

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despite the world falling apart. Now, if you go to Memphis like I think it went down like 70%

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and never really recovered. So hey, it all. It all equals out, and it depends on which market you're in. But if you look at these markets with stronger fundamentals that have a reason to not go down in value, I mean, Nashville is a great market for a lot of reasons, because it has a diversified economy, right? Nashville has the education, it's got health care, it's got a burgeoning tech hub. Now you've got a lot of logistics, manufacturing, shipping, all of you know, music, entertainment, I mean, you name it. It's all there. But Nashville is not the only city like that. There are plenty of other cities that have diversified economies like that. Atlanta, Dallas, Fort Worth.

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Denver, Colorado, you've got a lot of these other like that's there's a reason that some of those cities are becoming more and more popular today.

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It's because that diversified economy means that they have fared fairly well through a lot of these downturns,

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and they recover faster. And you know, so people want to then start investing there. So what I will say about what's going on in today's market? Neither of today's conditions

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match 91 or 2008

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so history is on your side here. All right,

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let's go back to March of 2020. The stock market collapsed, the s and p5 100 fell 34% in about 33 days. It was wild. I mean, I'll never forget that, because I was sitting in my office and thinking to myself, like, okay, you know, everything is shut down, but nobody really knows what's going on and we're going to be able to get all of these deals closed. I mean, I literally had under contract enough. I was just as a broker. We had enough under contract for clients to have our best year ever, already in March,

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and because the s, p5 100 fell as rapidly as it did, I'll never forget there was like a Wednesday stock market lows, Thursday stock market lows, but everything was fine. Friday record woes again, and I kid you not, it was like a it was like a comic book. Every single one of our investors called on that Friday and said, Hey, terminate the contract. We're walking away. No matter what I tried to do to salvage it, there was just nothing I could do. No but everybody wanted to just sit and wait. They didn't know. So, you know, the stock market fell rapidly. But what's really interesting is that June of 2020 so that was March of 2020 June of 2020 the real estate boom began.

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I remember, that's why we started the YouTube channel. I literally had nothing else to do, so I started teaching you guys how to invest in commercial real estate on YouTube, and then it became the podcast, and everything grew out of that. But by June, we were back to it. I mean, we were putting property after property after property under contract because the sophisticated investors realized, one is really interesting buying opportunity. Two, everybody's getting money printed by the government. So there's going to be some funding going on, but three, because the government is printing money to help sustain what's going on right now, inflation is going to go up. Anytime the government prints money go buy more real estate, because inflation is has to go up. It has to because now there's more money in circulation, and so.

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The sophisticated investors saw that and said, time to buy some hard assets. Let's sell out of the stock market and start buying right now.

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And they did, and they just got to ride the wave of inflation for the most part. If you bought right you put the right debt on it. It was incredible. I mean, some of the best properties that I own today. We bought between 2020, and 2022,

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the investors that got hurt weren't the ones who bought during that time, and they were the ones who sold.

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We look back today. There were properties that we were buying for one to $1.25 million an acre on this Dickerson pike corridor right here, where my office is where the salt ranch hotel is. You could buy land in 2020 for one to 1.2 5 million an acre.

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Today it's over 2 million.

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And honestly, it got to about two to 2.2 5 million in 2022 and then interest rates spiked. Everything slowed down so it's it's been relatively flat for several years now because of where we are with interest rates and construction costs. But think about that. I mean, within a few years, you know, the pricing almost nearly doubled. So I mean, how pissed would you be at yourself if you were the one that sold in 2020 just because you wanted

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to get out? I would not be very happy about that at all. And look, we're seeing a lot of this again today. Institutional capital is not waiting. They are not waiting at all. They are buying While so many investors are sitting there and hesitating. Blackstone just paid. We talked about this not too long ago. They just paid $432

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million for a 16 grocery anchored retail portfolio in the Texas area, $432

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million life insurance companies are increasing their commercial real estate allocations and expanding their average loan sizes. That's according to northmark. So if you're not aware, life insurance companies place a lot of debt on premium commercial real estate assets, and you can actually get really, really, really good terms. If you have a class A apartment complex, or, you know, Class A office building, these, these life insurance companies will actually come in with 30 year amortizations, favorable interest rates, but they want long terms, you know, 10 years or so, right? Maybe shorter if you want to negotiate for that, but it's nice. If you want to hold somebody for a long time, just go with a life insurance company, because they they have so much money, they just need to park it somewhere and know that they're going to get a return on it. It's It's wild. And then CBRE is forecasting that commercial real estate investment is expected to increase 16% to $562

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billion in 2026

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so the institutional guys are not waiting for certainty. They're utilizing this uncertainty today as a good excuse to get buying fast,

Unknown Speaker 27:51

right? They are not waiting now, if you start to see those groups pulling back Absolutely, you should you should pull back and do the same. But as investors, it's prudent to follow what these larger guys are doing. That's not to say, like, Okay, well, just because, you know, the biggest institutional groups are investing in data centers, that you should go invest in data centers, because that's just not feasible. It's not possible.

Unknown Speaker 28:18

But it is to say they are spending a lot of money on finding the trends, on finding out where they should be investing, where is the puck headed? Let's skate there. So just follow them, right? It's like when you want to buy commercial real estate in an area figure out where the Chick fil A is going. You know, they spend all the money to do all the demographic research to determine are the traffic counts good enough for us here. If it's good enough for Chick fil A, I promise it's good enough for you. If it's good enough for Blackstone, start looking at it right for them to say, Okay, we're going to go buy all these grocery anchored retail properties in Texas. That says something to me about grocery anchored retail, maybe even retail in general in Texas. All right, so keep that in mind,

Unknown Speaker 29:03

there are three gifts that uncertainty like this gives to you, all right. Number one, actually motivated sellers owners with maturing loans and refinancing pressure become negotiable. They're willing to work more than they have ever worked with you, right? Three years ago, they had all the cards. All right, now they need an exit, and you can be the one to provide that to them, and often in creative ways. You don't necessarily need to go get a traditional bank loan. Maybe you can negotiate seller financing or a JV where they contribute the building as equity into whatever you're doing. There's less competition today, there are fewer buyers at the table. That means better pricing, better terms, and more time to make the right decision. You're not rushing into something just because you need to get a deal done. All right? And of course, there's a supply wall. Nobody is building new construction today. It is very rare.

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If you look at how much new construction we were doing in 1617, 1819,

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in even 21 and 22 and 23

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compared to today, it is a stark, stark difference, right? They're not building it's again, it's cost prohibitive, which means that existing assets are going to be more valuable today.

Unknown Speaker 30:27

As soon as certainty returns to the market, and everybody feels good about everything, those three advantages go away. So you will not be able to take advantage of those of motivated sellers, less competition and a supply wall.

Unknown Speaker 30:40

As soon as the market comes back, it's going to be a seller's market.

Unknown Speaker 30:45

There's going to be more competition, and there is going to be far more supply new construction that you are now going to have to compete against. So get moving now. So here's, here's your action plan, if you're, if you're sitting there thinking, okay, great. You know, I was worried about the market, maybe I feel a little bit better about it now, or at least I know how to cautiously be cautiously optimistic in my approach. Here's what I would be doing today, underwrite conservatively. I do this all the time, but you've got to underwrite conservatively on every deal that you do. Right. The hotel ended up taking us four and a half years to open the doors. But because I underwrote it so conservatively, I underwrote our boutique hotel that we put $7 million into to turn into this beautiful, gorgeous property, I underwrote it as if it was the Sleep Inn down the street.

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So the worst case scenario, we can compete with a Sleep Inn, if we have to, and the numbers worked, right? So underwrite conservatively, stress test at today's rates, not tomorrow's if you're buying at an 8% cap rate, underwrite it to an exit at an 8% cap rate, even if you feel very confident that you're going to be able to compress the cap rates through better leases, better tenants, down to 7%

Unknown Speaker 32:00

that's a best case scenario. But what happens if interest rates go up again and now you have to sell it at 8% you don't want to have a loss on your property just because you thought you were going to be able to be more aggressive than you could. There are some market components that you just can't control. So keep that in mind as you're going through that

Unknown Speaker 32:21

today, I would be focused on necessity based assets. These will be tenants who pay through any cycle, because they are necessity based. All right. So strip centers, right? You may be thinking, well, Tyler, how's that necessity based? I can't imagine. Dry Cleaners,

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the local bar, the nail salon, the wicker store.

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These are necessity based that people will shop at on a daily, weekly basis. All right, flex space. We love flex. We talk about flex all the time. Y'all love flex.

Unknown Speaker 32:57

Flex is great because, you know, these are typically the businesses that are relatively Amazon proof. It doesn't matter what's going on in the market, you still have to get your HVAC unit repaired. Doesn't matter what's going on in the market. If your your toilet starts overflowing, you're calling a plumber, right? We love those businesses. And of course, self storage. What's interesting about self storage? It's one of the most resilient asset classes out there. Through the pandemic. I think it had a 0.3%

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default rate

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because it's cheap. You know, you can rent self storage for 75 bucks a month, 100 bucks a month, 150 bucks a month, whatever it is, and it's more inconvenient for those tenants to go and take all their stuff out of self storage and is to just keep paying them.

Unknown Speaker 33:47

It's not enough to make a dent. So

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focus on the type of tenants that are going to be paying through any cycle. Now today, build your deal flow pipeline right? Make sure that you have enough opportunities to review so that you're not pigeonholing yourself into one opportunity. You want to make sure that you are looking at as many deals as possible so that you can pick the best one. You

Unknown Speaker 34:07

know, when I tell people that we're onboarding into the mastermind, because I take every single call for the CRA accelerator mastermind when I'm talking to them, you know, what we talk about is, like, you know, finding deals isn't hard. Like, it's like, once I show you how to find a deal. It actually like, I think over 56% of our members say that that's their number one best like best skill today, which I really appreciate, because it's the one thing that most people say is the hardest for them. It's actually really not like, once you know what a great deal looks like, you can see them everywhere, right? So it's not about finding one deal. You want to be able to find 10, so that you can then pick the best one out of 10, because you will have a much better opportunity there. And of course, get educated before it closes right. Make sure that you are reading the books, listening to the podcast, watching the YouTube channel, whatever.

Unknown Speaker 35:00

It is to make sure that you are up to date, up to speed, you have as much knowledge around how to execute this as possible. Get out there and build those relationships. Have the coffee with the title attorneys. Have you know, lunch with brokers. Get out there and meet property managers, whatever it is, make sure that you are as prepared as you possibly can be, so that when certainty returns, the prices will already reflect that, and you'll be able to execute that. All right.

Unknown Speaker 35:27

So

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all that is to say, the people who act in the next six months will look back at this moment the same way the 2020 buyers look back at that spring. And I'll tell you, it was a great time to be buying. It was phenomenal. I'm really glad that we took advantage of it like we did, you know, because it's interesting, like, we haven't bought as much in the last two, three years as we did in that 18 month period, to be honest with you, because we're prudent buyers, right? We buy when the opportunity is right and we sit and wait while everybody, while everything else is trying to get figured out,

Unknown Speaker 36:08

but when opportunities come across our desk, that makes sense. You bet we're we're striking on it right. This past fall, we bought 110 101,000

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square feet of flex space down in Chattanooga, right? Phenomenal opportunity to buy.

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A year and a half ago, we bought a 105 unit self storage facility, you know,

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actually here in Nashville, 10 minutes away from my office,

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when the right opportunities pop up, when you're putting yourself in the scenarios to where you can find the right opportunities.

Unknown Speaker 36:43

That's when it just makes all the sense in the world. We didn't have any competition going after those assets, which meant that we were able to negotiate the deals that worked really well for us. I mean, in five years, those will be some of the best assets we've ever bought, right? So the uncertainty isn't the obstacle waiting for it to go away is if you are sitting there thinking, okay, great, I know what I should be doing. I still need help figuring it out. That's what we do inside the accelerator mastermind like I will literally guide you the entire way through your deals, right? Doesn't matter how much experience you have, doesn't matter where you're located or where you want to invest, or what types of assets you want to invest in. I mean, you know, we will be releasing an interview with one of our members, Chad atraboni, here soon. He's in California. He just completed his first deal. He sold an apartment complex, did a 1031 exchange into a mixed use property in Grand Rapids, Michigan, right? I mean, he joined in October. What is it today's April 14. He's been with us for six months, right? Already done his first deal.

Unknown Speaker 37:48

Same with Matt barbacia. You know, you guys just saw his his interview go live on the podcast last week. Give or take, he bought his first deal in 45 days with 100% financing, pretty insane.

Unknown Speaker 38:01

So that information is at cre central.com, when you book a call there, just so you know that is actually with me. I take every single call because this is, this is a program we've got just under 200 members. I've onboarded every single person, all right, I'm very hands on with the mastermind, because this is a big decision right to start buying commercial real estate and building that portfolio. So if you want that, that's there, if not, we've got tons of information on this channel, on this podcast, you guys are welcome to dive into anything and everything that you want to hear. We will get you that education. But now it's your turn. What's one thing holding you back from making a move right now. I want to know in the chat, drop it in there, let me know.

Unknown Speaker 38:47

All right, let's get back over here and see. I have not been able to look at any of the questions. So let's dive into these. All shoulders are saying, Good morning, Tyler, good morning. Good to see you guys. Sorry. I know you know

Unknown Speaker 38:59

you know, you guys have been dropping stuff in here all morning, but whenever I do these presentations, I can't see the comments. Luigi saying, Good morning. Good morning. Luigi, glad to see you here. Payment, good morning. Viewer from Stockholm, sweet, we got Sweden in the house. What's going on? Payment,

Unknown Speaker 39:16

iron with Josh is saying, gotta wait for Earth's poles to shifts, then real estate will be the play. I love that. I love that gotta wait. Gotta wait for the moon to start rotating, and then we'll, we'll be good to go.

Unknown Speaker 39:29

There's always, there's always a reason to wait. Boomer is saying good morning, everyone, good morning. Boomer, glad you're here. Ted is saying good morning, Tyler, thank you for being here. Happy to do it, guys. I'm glad you, glad you guys could join us. This is always a fun time for me.

Unknown Speaker 39:47

Let's say Padre is saying run the wheel option strategy for 2% a month times 12 months equals 24% a year, returns without having to watch the market. Not sure what run the wheel.

Unknown Speaker 40:00

Option strategy means, again, that's probably some sort of stock market thing.

Unknown Speaker 40:06

Rickert is saying, Love what you do. Tyler mark, Rickard. Mark, great to see you here, man. Thanks for joining us. By the way, guys, we have a virtual summit for the CRA accelerator this Friday. I have failed to mention that on every single Podcast coming up to this, but I've shared it on Instagram. If you're interested in joining. Tickets are like 50 to 100 bucks, depending on on you know which ticket you want to get.

Unknown Speaker 40:30

We have three speakers. It's from, I think, 9am to roughly 1pm central time, three speakers. You'll be hearing from Matt barbacia, who just did an interview with us last week, he's going to walk us through his deal that he got 100% financing on in 45 days. We've got Ray Smith, who had a portfolio of about 100 single family homes, and has now sold off most of those and done 1031 exchanges into largely restaurant properties. But he's got a mixed portfolio. He's going to talk about what his experience was like with that. And then my good friend Evan holiday he's here in Nashville. He is a ground up developer doing tons of multifamily affordable housing. He's going to talk to us about what it's like to do to ground up development. Maybe he'll touch on some affordable housing, but mostly ground up development. So if you're interested in that, check out.

Unknown Speaker 41:22

Oh gosh, what is the what is the website? Of course, I'm not going to remember that. Pretty sure it's C, R, E central.com/virtual,

Unknown Speaker 41:29

Summit. Let me pull that up. Probably be a good thing for me to know that

Unknown Speaker 41:36

before I pitch you guys on it. It is not

Unknown Speaker 41:40

that. Is not it. Let me if

Unknown Speaker 41:45

you're on the email, if you're on the mailing list, we've mailed it out to you guys as well. Okay, it is cre Central, com, slash, virtual. Dash, Summit, Dash.

Unknown Speaker 41:57

M,

Unknown Speaker 42:00

pretty sure

Unknown Speaker 42:03

it is free for our active members. It is

Unknown Speaker 42:07

not free

Unknown Speaker 42:09

if you are not a member, so go check it out.

Unknown Speaker 42:13

All right, let's see payment is same question. Have you ever encountered anyone tapping into us, commercial real estate market from outside of us and being successful? Yeah, absolutely. I mean, we've got investors from Australia. I've got several members of the mastermind that are in Canada. We've got a member of the mastermind in Israel. We've got one in Japan. So, yeah. I mean, you can, you can invest in the united us commercial real estate market from anywhere. It's just a matter of making sure that you're taking the right approach, getting the right education, learning how the market works, and then ideally, what I recommend is finding a local boots on the ground. Partner

Unknown Speaker 42:46

1776 is saying, is it better to find a parking lot opportunity that's not zoned commercial yet? Could be good. Totally depends on what you're able to buy for and how feasible it is to actually rezone it. You know, I'm doing a parking lot right now. I was going to build a building on it. Ended up getting pitched by a neighbor about how much they needed parking. Went out and talked to a parking lot company. I was going to spend about a million dollars to renovate this building and turn it into like a YouTube studio and event space we're going to own or occupy it. And instead, it cost us $55,000 to just demo the building

Unknown Speaker 43:23

level out the lot and the parking lot company gave us a pro forma for $7,500 a month, net to me. So I mean, I'll still have, like, property taxes and insurance coming out of that, but 55 grand to make 7500 a month, I will take that all day. What a great deal. Really excited for that. Anyways, guys, thanks for joining me this week's office hours. We went way over. Happy to do it, though it was a good conversation. Thank you guys for all the great questions, for jumping in the live chat as always. Let me know what you guys need. I'm here to deliver what you are looking for. Somebody said last week or a couple of weeks ago. Hey, there's a lot of market uncertainty out there. I want to know what I should be focusing on right now, and that's why we decided to do this presentation. So leave me comments on the videos. I look at every single one. I try to reply to every single one. If you have any questions about what's going on in the commercial real estate world, let me know. Appreciate you guys. Thanks for joining me on this round of office hours. We will see you live next week, Tuesday, 8:30am Central Standard Time. I'll see you guys in the next one. This

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episode of the commercial real estate investor podcast is brought to you by my cre accelerator mastermind, where you'll get access to my step by step investment blueprint, essentially a library of resources on how to invest in commercial real estate. You'll get connected to a supportive community of other commercial real estate investors that are doing projects just like you. You'll get personalized coaching and feedback from me every step of the way go to www.crecentral.com to learn more.