Light Industrial of Residential

[Trent Dyrsmid]

In 2019, we bought a multi-tenant light industrial building for $1.3M. It had a great skeleton...but it needed significant amount of work...plus all the tenants were on month to month leases at below-market rates. As we improved the building, we notified the tenants that they were going to have to pay market rents...and ALL of them moved out (they were very angry that we have the 'nerve' to raise their rents).

Two years and $150K of improvements later, we had the building fully leased on triple net leases at market rates and we sold it for $2M. (I wish we hadn't).

So...my question is this...going forward, there are two paths we are considering:

1. Look for another light industrial building (we'd likely have to raise cash from investors to be able to pay cash to make it work now that rates are higher...and we've never raised equity before)

2. Look for single family houses to either BRRR or take advantage of a recent zoning change that would allow us to split larger lots (.25 acre and up) into smaller lots (.08 acre) and then build either duplexes or townhouses on the smaller lots that we'd create.

Obviously, both strategies will work...but I'm trying to decide on something that I can get really good at over the next decade and build signifiant wealth doing.

Thanks so much for your input!!