How did you break into CRE (Investing)?

Question

Hi all,

Hope all is well. Avid reader, but first time poster. I'm wondering how some of you broke into commercial real estate investing. I believe hearing people's stories and strategies is a great way to learn - especially for some of us who are just starting out in the industry.

So, how exactly did you get started?

David Thompson · Answer

Austin,

How I got into MF was hire a coach who was doing MF to learn from him.  He had a formal program and good 1x1 time to review analysis / examples of understanding markets, deals, etc.  I set a goal to buy my first 100 unit + apartment over the next 12-18 months w/some partners.  However, about 3 months into the education process I was not having much success finding deals nor did I feel like if I found one, investors nor lenders would take me seriously w/o a track record.  Hence, I turned to my coach and asked him how I can help him ?  That was the pivotal moment in launching my success in MF because at that time, he had a 320 unit deal in Dallas that he had under contract and I just asked him if I could help raise some capital.  He said if you are going to learn to own your own apartment some day, you might as well test your network, learn to capital raise and those investors are your investors, not my investors.  That's all I needed.  Lesson learned, I knew that leveraging his firm's credibility, good deals in solid markets, investors would be easier to attract the capital needed to fund the deals.  That recipe worked very well.

I raised $1m in two weeks on that deal, surprised myself and my coach.  Raised the bar on the next deal and hit $1.3m.  On the 3rd deal, hitting $2m.  It also gets easier as you do it because you start getting repeat investors as the trust grows and good deals continue to be in play.  I can't stress enough that if you want to get in the game, get some good mentor / coach who's actually doing deals and be willing to help them either find deals or raise capital, as I think these are the two best ways to do it.  My business partner wrote actually 7 ways to get into MF, see link below.

You can listen to some of my podcast interviews on my BP profile website or go to my company website under Thought Leadership and review the links.  Go this route if you want to accelerate your growth and only if you are extremely passionate, can carve out the time and having a "willing to help" attitude.  Don't get into it for the money per say, just know you are planting seeds... focus on learning and building your credibility and brand first.

https://www.biggerpockets.com/forums/223/topics/31...

https://www.biggerpockets.com/forums/432/topics/30...

Dave Van Horn · Answer

Hi @Austin Maleki,

Good idea for a forum thread!

I originally started out as a contractor for commercial developers but then later on I was a fundraiser for commercial projects - which grew out of an opportunity presented to a networking group I created. I also did some small commercial deals as a realtor. It was kind of the culmination of all of those roles that parlayed into my Commercial RE Investing career.

Best,

Dave

Jared Watson · Answer

I joined biggerpockets and had 2.5 mil in acquisitions on 5 houses in the first 8 months with 5 different biiger pocket investor.

What you should ask yourself everyday is

"What am I going to do different to pull away from the pack "

Sean Murray · Answer

Hi @Austin Maleki

You raise a great question. Many times, a commercial property's value is based off the Lease term, rental rate, and credit of the Tenant. I have seen investors make excellent money by purchasing a vacant building, signing a strong Tenant to a long term lease, and then turn around and sell the asset as a leased investment. Sometimes it takes awhile to find this Tenant... but it can be worth it.

What sector of commercial property are you interested in investing? What is your exit strategy?

Dan Genzel · Answer

Started as a CRE broker and deals just started falling in my lap - to date I've syndicated about $85m.  Now I'm raising a fund for more efficient capital.    Like @David Thompson said get a coach.  It will shorten your curve and be the best money you spent.  It's all about mindset.

It all starts with the money.  Get investors and understand what kind of deals they want and go get them.

I'll assume you know 25 or more people with $10k or more...if so your good to know and need to execute a plan.

Dave Van Horn · Answer

@Austin Maleki

It sure was! I've done a variety of commercial deals including Mobile Home Parks, Commercial Office Condos, Apartments, Storage Centers, Mixed Use and some Multi-Family as well.

Joel Owens · Answer

Hi Austin,

My e-mail is in my signature line.

Thanks

Austin M. · Answer

Sounds like a really interesting path filled with a lot of experience, Dave. What type of properties did you end up doing deals on?

Austin M. · Answer

Thanks Joel. Do you mind if I PM you with a couple of questions?

Austin M. · Answer

Thanks for the reply Sean! I'm actually starting out my career in REIT research, and the property types that have caught my interest are strip centers / office. Generally just looking for some approaches people have taken to get started (whether that be through a career or personally).

How did you break into CRE (Investing)?

Most Popular Reply