DIFFERENT SUGGESTIONS FOR COMMERCIAL REI

[Jordan Butz]

Hello BP! I am reaching out to everyone because I wanted to hear about the different avenues for investing in commercial and what they were. Is there anything besides multifamily to pursue? What has been the historically best type? What were some of the strategies it takes to get a property and the path to get into that position to be able to make such a move? background: currently living in Huntsville, AL and loving the huge diversity and increase in spending in the city

[Jeff Kehl]

@Jordan Butz Why do you want to get involved in commercial properties other than multi-family? Everyone else and their brother thinks multi-family is the best place to invest right now. Is that maybe why you are looking at other categories? If so I applaud the thought because I am doing the same thing. The standard reason you will hear for getting into multi-family above all other types is  that it has universal need, everyone  needs it. 

In the future everyone will work from home so no need for office space and everyone will buy everything sight unseen off the internet so no need for retail right? Industrial? Everything will be printed in your living room.

To some extent I agree with these statements which is why I currently own a lot of multi-family properties. But I am not buying as much as I used to because the prices have gotten unreasonable. While other fight over unprofitable deals I prefer to explore other opportunities.

Precisely because everyone is aware of the internet's affect on CRE there hasn't been a ton built recently in my area. Guess what class of property has the highest demand right now? Retail believe it or not. Don't get me wrong,our Mall is dying like everyone else's is. It's very important what type of retail. People still want to go out on a weekend and have an awesome experience shopping. Maybe even more than they used to,

The owners of the mall (who bought it for a song in bankruptcy) just submitted plans to demolish half the square footage. What will they do with the extra room? Divide it into outlots for new restaurants and bars. People are still going out to eat and experience things. The internet can't quite replace that yet. Go to the hot are of your town on a Saturday at 8 pm and see if you agree.

I went to a mall in Orlando a year ago that was completely dedicated to entertainment. Restaurants, Bars, movie theaters. Yes even movie theaters are still popular but they have also had to adapt to provide more of an experience. They offer comfy seats, food and drink while you watch.

So this is a long way of saying look for investments related to new entertainment trends and I think you will find great investments. The other thing like is 'ecommerce proof' services. Hair salons, nail salons, yoga studios, Dojos. Again, the internet can't provide these experiences yet.