I’m looking to move to either Tampa or Vegas to work in commercial real estate (brokerage) and I’m leaning towards Vegas. The plan would be to wait tables nights and weekends and do commercial real estate during the day. I’m wondering if there’s anything I should be aware of in regards to how I’d be setting myself up to succeed by choosing Vegas as a market. Thank you!
Hi @Glenn Gayet I think we'd need a bit more background on you before any of us could speak to "setting yourself up for success" however, the commercial market here in Vegas does currently have a good bit of opportunity (much more than the resi market).
Also, as a commercial investor that recently transitioned to the Vegas market, I have had some interaction with commercial brokers/agents here and I will say that there is definitely room for those that want to stand out as rockstars. There are some gaps that I've identified in what I typically look for in a broker/agent so definitely room for more talent here.
@Marty True Thanks for the response!
By setting myself up for success, I mean choosing a market that has the right opportunity. This would include:
* The attractiveness of the properties available
* Does Vegas being a transient city raise concerns for multi-family investors? Or is it actually an advantage because it means more of the residents are renters?
* What concerns do investors have regarding a service industry economy that may suffer during economic downturns? What effects have bad economic times had in the past on the rental/multi-family vacancy rates in Vegas? If there has been any affect has it only been certain neighborhoods or rent price ranges, ect.?
* What is unique to the Vegas market that makes multi-family investing better or more risky for investors and how does this affect how a commercial real estate agent goes about selling/locating properties/choosing a market?
I'm thinking Vegas over Tampa because I have more friends out west, it's affordable, no state tax (Florida too), and it may seem like somewhat of an oxymoron when choosing Vegas as a city but I'm not all too much into drinking and going out anymore and Vegas provides close access to other types of fun like the Red Rocks, nearby Lake Tahoe, Beaches in Cali less than five hours, Canyons in Utah and Arizona, ect.
Phoenix seems too spread out and Cali is out of my price range at the moment.
Tampa seems like it just has good weather and the beach. Seems like it would get old. There is more to explore out west.
Plus, I played hockey and Vegas has the Vegas Golden Knights, so that's a bonus.
Answering a few of those questions. I'm not in commercial real estate (although I've definitely thought about it), this is all from my observations as a former resident and landlord.
So... there are quite a lot of attractive properties that I've seen, but a disturbing number of them are partially or even mostly vacant. Supply has always seemed to outstrip demand for spots in places like small strip malls.
The transience generates a pretty large pool of renters. Its a pretty hot rental market and growing. My PM tells me that there are now waiting lists for all new builds. People always plan to leave Vegas and "go home" or somewhere else, but the large number of extremely well paid jobs that have very low education or skill requirements tend to make these "transient" workers more semi-permanent. We call them "golden handcuffs", where they don't leave the job because they'll never get paid as well anywhere else with the same credentials. That creates a lot of renters, always ready to leave but never doing it unless they basically get forced to.
Serious downturns in Vegas are few and far between. As shown time and time again, Vegas is downturn resistant. That isn't to say it's immune, far from it... When a major downturn hits hard, Vegas gets hit harder... but minor and even moderate downturns have minimal affect on Vegas. Certain types of incidents (ie travel industry impacted terrorism, Mandalay Bay shooting) and really major financial crashes have a larger impact and tend to be longer lasting. Vegas has several major "feeder" cities from California, Arizona, Colorado, Texas, etc. where people can drive. In minor and moderate downturns, people often tend to take shorter, cheaper vacations. Rather than flying to more distant locales, people from the feeder cities will drive to Vegas for cheap hotel rooms, food, and entertainment (it still exists, mainly in Downtown). These tend to make up for the visitors lost from the reduced air travel. Of course, the major incidents end up creating layoff situations and that is when the transience really hits hard. All the renters I mentioned in the previous point will now leave in droves.
What I find difficult about multi-family in Vegas, is the lack of any deals on the market. I've looked to get into it many times, the few properties that exist have tended to be older than I am (aside from those in N Las Vegas, where I refuse to invest). Since my body is already breaking down, funky pains and creaking joints... can't imagine what that means for a building... that I'll have to pay to repair...
Lake Tahoe is pretty far, in terms of driving by the way. It's by Reno, not Vegas. Lake Mead is by Vegas. Tahoe is insanely beautiful though, Lake Mead a lot less so. However, Las Vegas is more centrally located to more national parks than any other major city in the US.
Phoenix is HOT. I mean Vegas gets cooking in the summer, but we all take comfort in the fact that Phoenix is almost always worse. You ever play Super Mario? Remember the stage where the sun is literally trying to kill you? That's Phoenix, Vegas too but less often than Phoenix.
Golden Knights. They really epitomize Vegas. A bunch of misfits and rejects that couldn't make it anywhere else, but somehow succeeded way beyond anyone's wildest's imaginations in Vegas. That's VEGAS BABY!
@Account Closed not so much insider info, just what my realtor and property manager have told me. I'm no longer living in Vegas, I've been gone for about 6 years, but was checking into getting another property and that was part of the report I received on the situation "on the ground".
And yes, downturn resistant, not downturn-proof. Major events hit Vegas harder, but minor recessions are generally shrugged off. Actually, until 2008 it was "conventional wisdom" that Vegas was recession-proof. That proved not to be the case, but decades of historical evidence should still hold at least partially true and show resistance, rather than immunity as previously believed. This article is one of many from 2008 (I just picked one at random) when everyone was reporting the surprising fact that Vegas was being hit by the downturn.