All Forum Posts by: Ash Patel

Stop letting people scare you out of investing in CRE!!! Click on @Joel Owens profile and literally read every one of his posts for the last two years.  It will take you a long time but it will be better education than any book!  Rarely do people start out in CRE by buying a CVS or Starbucks.  Buy a mixed use building, or a stand alone retail building and learn the intricacies of CRE.  Dealing with commercial tenants is a million times better than dealing with residential tenants.  There are differences in insurance, lending, zoning, etc, but none of those should be a barrier to entry.

I'm sorry but most commercial deals do not take 1-2 years to close as someone mentioned. Find a local CRE investor mentor and learn from them. I do all of my own management as well. Get out of the residential rat race and learn CRE investing!

What would you say to a finance major that just graduated college asking, how do I become a hedge fund manager!

Slow your roll! Establish yourself first.  How can you convince people you are a MF syndicator if you have zero experience in RE.  Put the work in, go through the grind, earn your stripes and move up the ranks.  While others applaud your drive, I say spend every waking minute knowing there is another you wanting the same thing.  How are you going to get there first!

Mixed use buildings are the hardest loans to come by in my experience.  For some reason, lenders hate them or don't know how to underwrite them.

I've seen dry cleaning tenants cause massive declines in value by having a chemical spill.  Strip malls that literally lost half of their value because of a spill.  I choose not to deal with any properties that have dry cleaners.

If your neighbor is medical, why not use that to your advantage and attract other medical tenants? Are you a building manager or a CRE investor? Let the tenants dictate what type of amenities they need and let them take the lead on implementing them. A 5100 ft building is not enough to make it a job.

When I first started in CRE I took a chance on a lender and they took a chance on me. A decade later, my loyalty is rewarded by this local bank closing on any POS deal that I bring them because of their confidence in my ability to turn things around. I was ok with paying a point higher while I was building this loyalty. Now I get 10 year fixed rates on CRE. I've seen people treat lenders as commodities, but I believe they are your greatest asset.

@Bharath Raj - Its good that you want to continue to focus on CRE. I learned the hard way and made a ton of mistakes. I would recommend posting questions on BP as soon as you find the next deal. In your spare time, pick some of the people on this post and read through their previous posts. Its more efficient than reading entire threads.

@Nathan Lovero - please clarify, "vacant commercial buildings all over the country".  Good dirt is thriving.  As @Priyanshu Adathakkar stated, office is hit or miss depending on the market but with retail hitting record low cap's I don't get the dismal view on commercial buildings?

Kudos to @Priyanshu Adathakkar and @Joel Owens for not pulling punches.  @Bharath Raj, My wife is a surgeon and I handle all of her real estate for her locations. She focuses on being a doc. I think you need to focus on being a doc also. If you want to dabble in real estate, get into a syndicated deal or a REIT. You can't buy a $750k building then and work backwards. I would hire a property management company but more importantly a CPA firm that specialized in real estate. Now that you are in bed with this property, figure out how your taxes can benefit from improvements, etc. Like Joel stated, its good that you are asking but hire professional help.

@Will F. - Good work!  

You can phase in the CAM charges slowly.  "New" business owners are likely nervous about opening a new location.  Maybe extend their lease one year but give them a break on first year CAM's.  I assume most utilities are separated out?