Wholesaling Commercial Real Estate

Member since 2023 · 13 posts · 6 votes

Hi my name is Robert Brock and I am new to the Tampa Bay Area. I'm looking to get started in wholesaling commercial real estate. Does anyone have any advice or suggestions they can give a beginner such as myself? Any help is greatly appreciated.

Thanks- Robert

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Henry ClarkPro Member

Developer · Member since 2020 · 4k+ posts · 4k+ votes

If you're doing Flex let's do a preliminary wholesale on me being the Buyer and also the seller. Don't think of knowing or getting all of the answers to wholesale. This will be a straight up listed property and a purchase just to see the process on a Commercial/Industrial property. Then think through it from a Wholesaler standpoint. The chances of you getting a property Wholesaling without it going through a commercial Agent listing is very slim.

1. Flex property listed for $2,000,000 in Tampa Bay.

2. Zoning is C3 whatever that means in Tampa Bay. You have to figure that out, relative to the potential buyers needs.

3. It has been listed for 3 months versus say 2 years. Means seller has not truly had the market do price discovery.

4. A Commercial realtor is handling the deal. And the Seller runs things through their lawyer.

5. Property is on 2 acres. Has 40,000 sq ft, with 8 bays of 5,000 sq ft. Is Pre-1970.

6. Tenants are all market rate. 5 year leases. 3 are NNN and 2 are NN. They have remaining years on contract- 1 is 5 years, 2 are 3 years, 2 are 1 year left. All are local except for one is a national brand auto supply store, using this for a warehouse. Rest are yard/snow plow, plumber, electrician, hot rod enthusiast, and a regional Power drink distributor.

7. You have to make a written offer. I'm going to ask for either a $50,000 downpayment or a source of funds letter from your lender to cover this amount.

8. You're going to negotiate for 30 days due diligence, 30 days to finance. I'm coming back at 30 days due diligence and 15 days to finance.

9. Do you have a due diligence checklist?

10. Do you have the downpayment or funding letter?

11. You just signed the offer letter and are on the clock. You have to find a customer who wants this type of property. They will want to also do due diligence. The longer you wait to find the customer, the less time they have to do due diligence. Plus, they need the 30 and then the 15 days to get their financing in order.

12. Somewhere in the above you need to work in either Title search or Title insurance.

13. This is a Pre-1970 property. Any EPA issues or studies required for your financing?

14. Any grandfathered items.

Forget whether you know the above. It's part of the learning curve. So you need to develop your checklists before you bring your first deal. 30 days is a very short time to execute and learn.

etc etc.

Use the above to start the development process for your wholesaling efforts.

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Chris SeveneyBusiness Member
Moderator
Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
1y
Quote from @Robert Brock:

Hi my name is Robert Brock and I am new to the Tampa Bay Area. I'm looking to get started in wholesaling commercial real estate. Does anyone have any advice or suggestions they can give a beginner such as myself? Any help is greatly appreciated.

Thanks- Robert

very challenging to wholesale commercial properties as there are a lot less than residential and most are more complex and sellers typically go through brokers and the buyers are more institutional as well. Good luck
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Robert Brock
OP
Member since 2023 · 13 posts · 6 votes
1y
Thanks for you feed back Chris. I appreciate it.
0 Reply
Jorge VazquezBusiness Member
Real Estate Broker · Tampa, FL · Member since 2017 · 1k+ posts · 692 votes
1y
Hey Robert, welcome to Tampa! When you say commercial, are you thinking multifamily, retail, industrial, or something else? If it’s multifamily, I’ve been in the business for 20 years and can share some insights. Commercial deals take longer and are all about relationships, so connecting with investors, brokers, and property owners is key. Also, zoning and market trends matter a lot more than in residential, so it’s worth getting familiar with Tampa’s landscape. Buyers in this space are more strategic, so having a solid buyer list early helps. Happy to share what I’ve learned if you ever want to chat!
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- Robert Brock
  OP
  Member since 2023 · 13 posts · 6 votes
  1y
  @Jorge Vazquez thanks for introducing yourself and sharing your insights. Right now, I'm looking into flex space within the industrial sector. However, I am open at the moment as I am just getting my feet wet and learning the Tampa Bay CRE market. I'd definitely be happy to hop on a call sometime and discuss my real estate goals and the experience you have here in Tampa.
  1 Reply
Ronald RohdePro Member
Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
1y
You can definitely do it. My clients buy from wholesalers all the time. Mostly MF and self storage.
I bought an industrial property from a wholesaler, paid him a $600,000 fee.
1 Reply
Robert Brock
OP
Member since 2023 · 13 posts · 6 votes
1y
Thanks so much Ronald. This is great motivation. Are you a commercial broker?
0 Reply
Jace Perry
Investor · FL · Member since 2017 · 134 posts · 66 votes
1y
It is a TON of work but you only need 1 to 2 deals per year to live the good life. IF you are going to down that path, focus on building relationships with key investors in town and top performing CRE agents. You can partner with them to dispo properties you come across since they already have a Rolodex of buyers. I would say that multi-family would be the easiest to wholesale due to how many there are in each metro market and the amount of MF buyers nationwide.
0 Reply
Robert Brock
OP
Member since 2023 · 13 posts · 6 votes
1y
Good morning Jace. Thanks a lot for your feedback. I really appreciate it
0 Reply
Ronald RohdePro Member
Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
1y
Quote from @Robert Brock:

Thanks so much Ronald. This is great motivation. Are you a commercial broker?

I am a commercial real estate lawyer.
0 Reply
Robert Brock
OP
Member since 2023 · 13 posts · 6 votes
1y
Hey Ronald. I just watched the video you shared with me on CRE. Really great content!!
1 Reply
Ronald RohdePro Member
Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
1y
Quote from @Robert Brock:

Hey Ronald. I just watched the video you shared with me on CRE. Really great content!!

Thank you!!!
0 Reply
Evan Polaski
Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes
1y
@Robert Brock, I guess my advice is not really any different than I would say to someone wanting to be a residential wholesaler: you need to add value to the transaction.

Often times, having the deal tied up is the value, but more often then not, in my limited experience with commercial wholesalers and residential, the wholesaler has no idea what someone will actually pay, so they tie up a deal at too high a price and then add their fee that turns a bad investment into a horrible investment. Or they bring a deal that professional acquisitions teams already know about.
1 Reply
Robert Brock
OP
Member since 2023 · 13 posts · 6 votes
1y
@Evan Polaski, I appreciate your feedback and agree with you. Right now I am focusing on building a strong buyers list before I really hit the ground running on marketing for sellers. This way I'm aware of the end buyers buy box before I go locking up contracts with sellers.
0 Reply
Ronald RohdePro Member
Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
1y
Quote from @Robert Brock:

@Evan Polaski, I appreciate your feedback and agree with you. Right now I am focusing on building a strong buyers list before I really hit the ground running on marketing for sellers. This way I'm aware of the end buyers buy box before I go locking up contracts with sellers.

I dont even think a buyers list is what you need. You need strong underwriting first to know what is a good deal.
0 Reply
Robert Brock
OP
Member since 2023 · 13 posts · 6 votes
1y
@Ronald Rohde thanks a lot for the advice.
0 Reply
Ronald RohdePro Member
Attorney · Dallas, TX · Member since 2016 · 5k+ posts · 2k+ votes
1y
Quote from @Robert Brock:

@Ronald Rohde thanks a lot for the advice.

You're welcome. It definitely can be done, but it takes more time and more investment per deal to hit $500k fees.
Its also a much, much smaller network. If you burn a seller, there's a 50% higher chance either he owns something else you're offering on or he knows the seller or his attorney knows the other attorney, broker knows about your past deal, etc.
0 Reply
Robert Brock
OP
Member since 2023 · 13 posts · 6 votes
1y
@Ronald Rohde those are great points. Right now, I'm doing a lot of research and trying to build a good base of knowledge before I dive in.
1 Reply
Henry ClarkPro Member
Developer · Member since 2020 · 4k+ posts · 4k+ votes
1y
OP. Think you had a similar post somewhere else I responded to.
What type of Commercial/Industrial properties are you talking about?
As you're doing your research, the main difference you will find with a Commercial versus SFH/MFH is the due diligence time constraints. Also, the vetting process of you the potential buyer. You will most likely need to be a qualified buyer with a lending institution and/or put down a downpayment. These will put pressure on a simple Wholesale transaction.
0 Reply
Robert Brock
OP
Member since 2023 · 13 posts · 6 votes
1y
@Henry Clark I appreciate your input. I have started doing some research in the flex space sector.
1 Reply
Henry ClarkPro Member
Developer · Member since 2020 · 4k+ posts · 4k+ votes
1y
OP
If you're doing Flex let's do a preliminary wholesale on me being the Buyer and also the seller. Don't think of knowing or getting all of the answers to wholesale. This will be a straight up listed property and a purchase just to see the process on a Commercial/Industrial property. Then think through it from a Wholesaler standpoint. The chances of you getting a property Wholesaling without it going through a commercial Agent listing is very slim.
1. Flex property listed for $2,000,000 in Tampa Bay.
2. Zoning is C3 whatever that means in Tampa Bay. You have to figure that out, relative to the potential buyers needs.
3. It has been listed for 3 months versus say 2 years. Means seller has not truly had the market do price discovery.
4. A Commercial realtor is handling the deal. And the Seller runs things through their lawyer.
5. Property is on 2 acres. Has 40,000 sq ft, with 8 bays of 5,000 sq ft. Is Pre-1970.
6. Tenants are all market rate. 5 year leases. 3 are NNN and 2 are NN. They have remaining years on contract- 1 is 5 years, 2 are 3 years, 2 are 1 year left. All are local except for one is a national brand auto supply store, using this for a warehouse. Rest are yard/snow plow, plumber, electrician, hot rod enthusiast, and a regional Power drink distributor.
7. You have to make a written offer. I'm going to ask for either a $50,000 downpayment or a source of funds letter from your lender to cover this amount.
8. You're going to negotiate for 30 days due diligence, 30 days to finance. I'm coming back at 30 days due diligence and 15 days to finance.
9. Do you have a due diligence checklist?
10. Do you have the downpayment or funding letter?
11. You just signed the offer letter and are on the clock. You have to find a customer who wants this type of property. They will want to also do due diligence. The longer you wait to find the customer, the less time they have to do due diligence. Plus, they need the 30 and then the 15 days to get their financing in order.
12. Somewhere in the above you need to work in either Title search or Title insurance.
13. This is a Pre-1970 property. Any EPA issues or studies required for your financing?
14. Any grandfathered items.
Forget whether you know the above. It's part of the learning curve. So you need to develop your checklists before you bring your first deal. 30 days is a very short time to execute and learn.
etc etc.
Use the above to start the development process for your wholesaling efforts.
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