26 potential first time buyer to buy Commercial Real Estate - Tips &amp; Tricks Requested
I'm a 26 year old who lives in the greater Seattle area and I'm looking to purchase some commercial warehousing space. The real estate market in Seattle is pretty expensive, so I'm trying to figure out how to calculate what my budget for space should be.   


Do you all have any tools or website you use to do this? I'm not sure how to calculate it, I'm thinking my budget would be higher than looking at a personal real estate since I would be making money off the space, but I very little at this point. Can anyone help guide me in my research?
[{"id": "fl1acmf", "text": "Im using CREXi to find space. It works well for me in LA", "replies": [{"id": "fl1hvm4", "text": "Never heard of that. Thanks I'll look into it", "replies": [], "depth": 2}], "depth": 1}, {"id": "fl1cfcg", "text": "I\u2019d assume you can get about 65-70% leverage on your cash. That is if things don\u2019t dramatically change over the next couple weeks... that should give you a decent ballpark of what should be within your budget.", "replies": [{"id": "fl1i4fn", "text": "&gt;I\u2019d assume you can get about 65-70% leverage on your cash\n\nProbably really dumb question, but what do you mean when you say this?", "replies": [{"id": "fl1ii5l", "text": "He means that if a building costs 1M to purchase, the bank will loan you 65-70% of the value of the property (650,000-700,000). You put up the difference yourself.", "replies": [{"id": "fl1w3u5", "text": "I'm not sure if he's talking about purchasing a building or leasing. Maybe he doesn't know yet either.", "replies": [{"id": "fl2bhzc", "text": "In the original post he said purchase", "replies": [{"id": "fl5jqc7", "text": "Ah, you actually read the post. Amateur move.", "replies": [], "depth": 6}], "depth": 5}], "depth": 4}, {"id": "fl27udv", "text": "Well shit.... Guess this isn't really an option for me then since a $1M building means \\~2000 sqft in the Seattle area. Guess I might need to start looking for investors :/", "replies": [{"id": "fl2hkgq", "text": "If you don't know what 65-70% leverage is, you should not be going out to find investors...", "replies": [{"id": "fl2m6lp", "text": "can't be an expert in everything....", "replies": [{"id": "fl3jl20", "text": "At least work to learn the best route to take, your education should definitely be your first investment in investing. There are a lot of ways to make a deal work and the spread that he was talking about (70/30) is pretty good but learn what you\u2019re getting into EXTENSIVELY when it comes to putting so much money into something. If you don\u2019t know how to structure deals yourself then I promise real estate will not serve you the way you might expect it to", "replies": [{"id": "fl5q0kv", "text": "Trust me I will. I haven't done much of any research on this yet, just have had my idea building in my head and wanted to get and idea of what I should be looking for as property values. Just was coming here for advice, wasn't expecting so many dickish people in this sub for a simple question, but I guess that's what I get for asking a question in a sub I don't actually follow.", "replies": [], "depth": 8}], "depth": 7}, {"id": "fl4668h", "text": "You should not be in charge or be taking on money if you don't understand how leverage works/means.\n\nIt's like those crypto or binary traders on Instagram. You need to learn the ins and outs of the business first before you start taking on other people's money as investment.", "replies": [{"id": "fl5q5ep", "text": "Did I ever say I wasn't willing to learn? I came for a simple question asking for help", "replies": [], "depth": 8}], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fl1q48v", "text": "Typically investment properties require a larger downpayment for your loan. The terms are typically shorter than residential as well which depending on how much you have for a downpayment and depending on how much you can buy, your mortgage on the warehouse will vary. I would speak with a lender.", "replies": [{"id": "fl27wtb", "text": "&gt;Typically investment properties require a larger downpayment for your loan. The terms are typically shorter than residential as well\n\nThis is good to know. I did not know this thanks", "replies": [], "depth": 2}], "depth": 1}, {"id": "fl1uftx", "text": "I would hold off for now. Lenders are inundated with forbearance requests and the bond market is wobbly causing lenders to have difficulties pricing rates. Even though reference rates are low, spreads are very high reflecting challenges pricing risk. If you can Bigfoot a deal all cash and you don\u2019t need it to survive for the next few months then have at it. \n\nHow do you even assess tenant quality today? When tenants start missing rent payments, it makes the deal impossible to underwrite for lenders. I could see lenders missing timelines on financing contingencies, if you don\u2019t know what you\u2019re doing take a knee.", "replies": [{"id": "fl2850h", "text": "Yeah this is an idea I've just had for years, I've just seen more and more interest recently and the timing of the state of the economy isn't idea at all, but I didn't know if it's something I should move on and capitalize or actually wait on, but just from the other responses it seems like I'll need more capital before I can really start to move.", "replies": [], "depth": 2}], "depth": 1}, {"id": "fl1w5yk", "text": "I absolutely thought this was a buzzfeed-style clickbait link and he was going to tell us 26 tips. Anyone else?", "replies": [{"id": "fl2876a", "text": "lol that's why I said request, probably would've been better putting that first", "replies": [], "depth": 2}], "depth": 1}, {"id": "fl26jul", "text": "You need an accurate model so you understand the cash needs, returns, debt assumptions, etc. \n\nMost people just rely on a back of the envelope or gut feeling and for a first time buyer, you need to truly understand all of the ins and outs of the investment.", "replies": [{"id": "fl28ah9", "text": "Definitely agree, was hoping to find some tools like that in this sub", "replies": [{"id": "fl2943h", "text": "There are a lot of good models out there, but I get mine from tsmfinancialmodels.com.  It comes with an hour of consultation too which is really cool.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fl2li67", "text": "Based on your responses to questions, I strongly suggest that you take a step back to learn about the basics of real estate, finance, etc. before attempting to buy commercial real estate.", "replies": [], "depth": 1}, {"id": "fl2n3uq", "text": "Dude before you buy commercial property please please look into how to implement the correct commercial lease for the space you are buying.", "replies": [{"id": "fl5pm1k", "text": "Yeah I of course will. I have so much more research to do before I pull the trigger. I just want to get an idea of what kind of budget I should be starting with", "replies": [], "depth": 2}], "depth": 1}, {"id": "fl2pr93", "text": "Dude you\u2019re going to get pantsed. Good luck with that buddy - I wouldn\u2019t look to crowd source it. My tip and trick is Get a job working for someone who can teach you how to do it before you do it on your own.\n\nAlso why industrial it\u2019s literally the most expensive thing to buy right now and is not as straightforward as you\u2019d think.", "replies": [{"id": "fl5ppua", "text": "Can't really do storage with residential... I have a very good job atm but this is my side hustle for a need I see in the market I'm in, plus space I can use for myself", "replies": [], "depth": 2}], "depth": 1}, {"id": "fl2qttb", "text": "If you really want to get into investment real estate, start with one single family rental and work up from there.", "replies": [{"id": "fl2sig6", "text": " Coronaflu isn't going to hollow out Commercial vacancy at all. Why not go all In first time\ud83e\udd14", "replies": [], "depth": 2}], "depth": 1}]