Looking to invest. Live in Newport Beach. Interested in out of state properties. How do you handle this?
Properties in Southern Cali is way too expensive. Also Phoenix shot up too. Any advice for rookie commercial investors where to start? Thanks
[{"id": "im4sf0r", "text": "Start with crexi.com and begin browsing assets to determine what you find appealing.", "replies": [{"id": "im754ji", "text": "Thank you. I like Crexi. The market I\u2019m following (Phx since my parents just moved there) is ridiculous. \n\nI see properties that sold for 100k in 2019. \nNow the exact same property is on the market for 250k+.", "replies": [], "depth": 2}], "depth": 1}, {"id": "im4v37x", "text": "Single tenant net lease properties with a corporate guaranteed lease are probably the easiest to get into and most passive and hassle free of the cre property investments.", "replies": [{"id": "im6e7cz", "text": "Agree with this. If you have a boatload of money and just want a low yield that is not correlated with other assets in your portfolio, this is an easy way.", "replies": [], "depth": 2}, {"id": "im75ily", "text": "Awesome. Thanks for this. Assuming they\u2019re competitive and challenging to find\u2026?", "replies": [{"id": "im76tcu", "text": "Dollar generals are a dime a dozen", "replies": [{"id": "im7hwbn", "text": "Yeah, dollar general is one of the quickest growing retail tenants. However,  all their leases are corporate guaranteed, so even if their is a recession and people stop buying things, your monthly rent is guaranteed", "replies": [{"id": "im9ahkr", "text": "Do you have other examples like this or mainly it is dollar generals? How do you find places to rent out to dollar general or can you find places with a deal in place already?", "replies": [{"id": "im9bi6t", "text": "Big box retailers, medical office buildings, car dealership, you name it.", "replies": [], "depth": 6}, {"id": "imb1n3r", "text": "Any retail tenant may have a corporate guarantee, but not all corporations are made equal. A guarantee from an investment worthy tenant means more than one from some no name Mom &amp; Pop shop", "replies": [], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}, {"id": "im7hlc4", "text": "I do (off-market) brokerage for STNL &amp; MTNL properties. You're welcome to dm me if you have any questions", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "im5o9rq", "text": "Don\u2019t Invest out of state unless you know the market or have a partner in that area.  I am in a market that has a lot of California investors working it and the joke is if the property is overpriced we say it\u2019s a \u201cCalifornia buyer special \u201c.  Way too many buyers are overpaying because they don\u2019t know the ins and outs of our market.", "replies": [{"id": "im61n4c", "text": "What market are you in?", "replies": [{"id": "im69ai3", "text": "Albuquerque NM", "replies": [{"id": "im72ebp", "text": "I knew it!", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}, {"id": "im6jc3w", "text": "Hey we have a Miami buyer special here in SWFL!", "replies": [], "depth": 2}, {"id": "im75f10", "text": "Definitely. Makes sense.", "replies": [], "depth": 2}, {"id": "im784xd", "text": "CA suckerfish", "replies": [], "depth": 2}], "depth": 1}, {"id": "im6adbv", "text": "Finding a good GP/sponsor that you trust is sometimes your best bet if you don't have experience and/or local knowledge, vendors, and broker contacts. NNN deals are always a passive option as well but returns should be/could be lower.", "replies": [{"id": "im757gf", "text": "Thank you for the advice. Yes definitely interested in NNN only options \ud83d\udc4d", "replies": [], "depth": 2}], "depth": 1}, {"id": "im6v3fj", "text": "Hey dude DM me, we\u2019re an outpatient medical office owner/operator based in OC. Our portfolio is national.", "replies": [{"id": "im75awp", "text": "Done \u2705", "replies": [{"id": "im7wsgu", "text": "Mind if I get some info on this too?", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "im74k6p", "text": "Are you interested is actually managing the property and putting in the work involved or just want to take advantage of the passive income benefits that commercial real estate provides?", "replies": [{"id": "im74u7f", "text": "Definitely the latter. My wife and I work FT. I own a business so I don\u2019t have time to manage anything out of state", "replies": [{"id": "im767wa", "text": "Have you heard of real estate syndication? I found it to be the best opportunity to invest passively as a busy W2 worker. \n\nMy partner and I have invested in two apartments in out of state markets with partners who are experienced in managing properties and know the markets down to the neighborhoods. We get quarterly cashflow and a piece of equity on sale so all of the benefits without the work on our end. You just have to find managing partners you trust to deliver a strong return on your investment.", "replies": [{"id": "im76hse", "text": "We\u2019re looking to build our own portfolio and get the tax benefits that come w owning CRE", "replies": [{"id": "im77t0b", "text": "A syndication unlike a REIT, allows the depreciation of that property to be passed on to the investors since they own part of the property. A unique strategy used is bonus depreciation which allows you to accelerate the depreciation of the property in year 1 to show a negative return or loss on the K1 tax form even if you are receiving distributions from that property. \n\nIf you are trying to write off your W2 income, then you would need to be a real estate professional in order to do that.", "replies": [], "depth": 5}, {"id": "im7p3b6", "text": "Agree with u/Curmudgeoneer here. That\u2019s great advice on depreciation and REP certification. You can check out [Crowdstreet](]https://www.crowdstreet.com) to review deals or find a good independent syndicator who has had long term success (including multiple full cycle deals) and, preferably, has been experience through previous market downturns.", "replies": [{"id": "im9bxxc", "text": "I\u2019ve always wondered about this, what\u2019s the difference in pros/cons between finding a random (not directly known by an investor) syndicator vs something like Fundrise?", "replies": [{"id": "ima514p", "text": "The major callouts from my perspective are:\n\nIncome generated through real estate crowdfunding platforms like Fundrise (eREITs) is treated as ordinary income. This may not matter to a low-income individual, but any high-income earner will already be in a high tax bracket, and therefore will have a large tax burden on any distributions the eREIT generates. Income generated through a syndication is treated differently and will provide more tax-advantages. \n\nFundraise allows you to invest with a few hundred bucks which drastically decreases the barrier to entry. A syndication often times has a minimum of $50K to invest.", "replies": [{"id": "ima6ux7", "text": "Those are great points, thanks for the insight. It's something I've been considering doing, just curious about how to go about finding syndicators to be a LP basically.\n\nIs Crowdstreet basically a syndicator platform?", "replies": [{"id": "imaumu9", "text": "Crowdstreet is a software marketplace where a syndicator may share their deals. However, those deals are, from what I have seen, limited to accredited investors only. You must be an accredited investor to invest in a 506c offering which is why the sponsors are allowed to advertise those deals. There are 506b offerings which are not on the marketplace because they cannot be advertised. To invest in a 506b offering, you must be a sophisticated investor (know what syndication is and how to assess a good versus bad deal) and must have a \u201cpre-existing\u201d relationship the sponsor you are investing with. There are varying levels of what defines either of those requirements but it is a grey area. \n\nI prefer to meet my sponsors networking or through referrals, understand their track record, and whether we align in values. I have learned much more from my partners than just real estate that I personally wouldn\u2019t invest in a marketplace. That doesn\u2019t mean it isn\u2019t a good platform for other people especially if they are having a hard time finding a syndicator.", "replies": [], "depth": 9}], "depth": 8}], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "im758ag", "text": "I specialize in selling net lease across the country if you have any questions feel free to reach out", "replies": [{"id": "im9kfcn", "text": "Hi. I\u2019d be interested in seeing what u have. Are any of these priced under market?", "replies": [{"id": "im9madh", "text": "Not really most things are over priced right now but I\u2019m happy to discuss. Send me a DM with your email and we can connect. My team does 800+ deals annually and we have like 500+ assets listed so I need more info from you before I start sending you opportunities", "replies": [{"id": "imt085h", "text": "Sent", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "im7mgdn", "text": "Lockhart TX.  I\u2019ll fly you out and show you around. \n\nNo joke.", "replies": [{"id": "im7wu69", "text": "Hows the market in Lockhart?", "replies": [{"id": "im9w80a", "text": "I-30 corridor is the future of Central Texas chip manufacturing, in addition to all of Elons companies headquarters. \n\nBetween Samsung and Micron alone, we are taking well over $100billion in plants. Lockhart has all the charm of small town, and only 30 min from downtown Austin. Super cheap land (for now).", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "im8xx4e", "text": "Hire a local team. Preferably visit in person in the beginning.", "replies": [], "depth": 1}, {"id": "im9dhtd", "text": "You can look into real estate syndicates, allows you to invest with a team who already has everything in place\u2026 Avgi.com", "replies": [], "depth": 1}, {"id": "imaaleb", "text": "NNN ground lease deals. Wawas in PA are good examples", "replies": [{"id": "imcegix", "text": "Yes. Only single tenant I\u2019d consider are these big companies \ud83d\udc4d", "replies": [], "depth": 2}], "depth": 1}, {"id": "imdpjxd", "text": "If you want to be an active investor; start researching markets and then you will need to build a team there (attorney, real estate agent, lender, property manager, contractors etc.). If you do not want to do this; you should invest passively in other people's deals.", "replies": [{"id": "imt0drq", "text": "Thanks for the tip. Very good advice that I will take.", "replies": [], "depth": 2}], "depth": 1}]