Commercial Real Estate Investing: Understanding, Finding, & Funding Deals in Today’s World.
Disclaimer:
Nothing in this book should be taken as investment advice, or advice at all for that matter. Make sure you do your own due diligence when making investments and buying real estate, and consult an attorney and other industry professionals prior to making any sort of decisions. This book is a great informative guide and can supply a large amount of information to get you thinking about commercial real estate.
Foreword
Physical property and land remain eternal in their scarcity. The value proposition of land and of physical property as investments is unwavering and unbreakable.
After more than 12 years of expansion in the U.S. economy, commercial real estate (CRE) is increasingly a fan favorite of the institutional equity crowd. They are desperately seeking out steady cash flow in a low-yield world, one where fixed income continues to be at the crossroads of a multi-decade bull market.
You are probably coming in with your own perceptions of commercial real estate (CRE), and these perceptions will be intimately tied to your own fields of expertise and the sides of the deal table where you typically sit.
A business owner, private investor, partnership sponsor, developer, lender, family office portfolio manager––each of you has unique vantage points on commercial real estate, its pros and cons, and its place in your or your clients’ portfolios.
Two different market participants in commercial real estate deals and projects may indeed have different timelines, incentives, and, let’s be frank, different biases. But in all successful deals, the parties quickly agree on what makes a deal accretive, and, therefore, worth the risk. Having the right intermediary, the right “quarterback” who brings industry specifics, trends, and metrics to the table is what moves a CRE deal past the dreaming phase and makes it manifest.
Because commercial real estate is rooted in its nature of having finite capacity––there’s only so much available––it will always be attractive as a non-correlated asset class. Stocks and bonds can always be over-issued, and, thus, become saturated.
But there are only so many high value “squares” on this game board of American land. And this insight will lead us forward in the coming years as we navigate an economy that is, in many ways, transitioning but sits as strong as ever. The transitions occurring and the secular shifts we see across several sectors are, at present, immense opportunities for those who understand the why’s and how’s of it all. We’ll address this as we discuss specific property types and deal structures in later chapters.
This book will examine all of the core commercial real estate markets as we enter this most interesting decade. We’ll also dive into each market’s core constituent submarkets to give a proper, holistic view of the broad investment canvas that is CRE.
We’ll peel back the layers on areas of the market that may be unfamiliar to you. By removing unnecessary obscurity and opaqueness, you’ll better understand the positive slope currently seen in the risk/reward profile across the commercial real estate investing.
We’ll be talking about the specific ways to source, own, renovate, and fund commercial property. Banks and traditional lenders have a cookie-cutter approach to lending to CRE that is quite simply outmoded in today’s ultra-competitive deal landscape. Deal sizes are getting larger, supported by debt and equity markets that are deeper and more liquid than we’ve seen in many years.
Our goal is to peel back the proverbial curtain to reveal all the commercial financing potential available in today’s marketplace, and how the right financing can both reduce capital risk and expand your exit strategies.