Strip malls Flipping - BRRRR - Best Mentor/Guru to learn from ?

8 Replies

@Shaz Sheikh I don't know the answer but I'm following in case someone does. It's a goal of mine to own a small strip center so I'm in learning mode as well. One thing I can offer is what I have been doing. There are a bunch of REITS that specialize in shopping centers and I have found you can learn a lot by reading their reports and listening to their conference calls. 

Also, I'm a passive investor in two strip malls via crowdfunding and you can learn a lot by reading their investor materials/listening to their calls. The most recent is a company called Big V capital that has a current offering on Crowdstreet. They did an excellent webinar yesterday that you can probably view the recording of on Crowdstreet.

Hi
I’d be happy to look at a property with and for you

Do you have a specific center in mind? If not your best path to learning is to start with a real case study

@Shaz Sheikh we bought our first strip center last year. In Mississippi. We're more buy and hold but we bought a 6 unit strip with 2 vacancies. Have filled one vacancy and close to filling the last one. After that we will refinance. There's not a lot of activity about strip centers on here. 

@Joel Owens might be of some assistance. 

@Jeff Kehl Can you share which REITS those are? I'd like to check those out. 

Hello my friend, as you know, strips can range from $500k to a $100MM+. The fundamentals of real estate investing apply to all of them. Start with Income - expenses. Also know your leases backwards and forwards. The loss of one lease can crush your cash flow if you have a business serving as an anchor (on a big scale think Toys-R-Us). And of course location is always important, but especially unforgiving in retail. Try to accurately project future maintenance cost and repairs because those get very costly on commercial properties, even the small ones. I don’t know any gurus but best of luck to you if you decide to make a play on a strip!

Is anyone worried about the Amazon effect on stop malls like me? I used to go to the vitamin store in the strip mall, now I order on Amazon from my couch. I used to go to bed bath and beyond with my wife when she needed kitchen stuff, now she buys on Amazon. There has to be a strip mall meltdown coming like what is happening to malls. Thoughts?

Hi Ron,

No retail meltdown. In my area about 4% vacancy levels. Cold belt states that have weak suburban  to rural those buildings when empty can sit for years but has little to do with retail and more to do with those towns have had declining population and income metrics for years to decades. Very rare for retailers to want to expand in those markets when more fruitful areas are abundant.

Except for isolated pockets in cold belt states the more robust growth is in warm belt states boosted by the migration patterns from baby boomers.

Vitamin shop is not an experiential tenant. I knew they were going out years ago. I focus on internet resistant tenants (gyms, karate schools, restaurants, nail salon, barber shop or hair salon, off site dry cleaners, doctors office,etc).

Online sales makes up only a fraction of all retail sales. People are not going to sit in their house 7 days a week a have constant crap shipped to their door. Humans are interactive and do not live that way at least a majority of the population does not. They want to get out and have experiences.

Retail does not worry me in the least in fact I am super bullish on it but I review about 1,000 properties a week. Probably more but I stopped counting. I like the space very much but with anything if you are not well versed in it you can lose money.

I do not do the course or mentor type thing. I do have clients that purchase through me where they learn along the way.

Selling a 5 or 10k course has no interest to me. The person takes up a ton of time and little return. If I have a client buying a 6,000,0000 retail center and I make six figures in commission and then they buy another the following year I get a great return on my time invested.