Interest Rates, AI & a Bucket of Cheese Curds

Mike and Marc are back in the CRE Vault—and fresh off a whirlwind road trip to Milwaukee for an NAI regional conference. Seventeen hours in the car, a Brewers game, questionable amounts of Wisconsin cheese curds, and somehow they still managed to squeeze in a little commercial real estate.

In this episode, the guys recap the trip and dig into what brokers across the Midwest are seeing in today’s market: stubborn interest rates, longer deal timelines, shifting multifamily conditions, prospecting, and why relationships within the NAI network matter when business gets complicated.

They also tackle one of the biggest conversations in CRE right now: artificial intelligence. From AI agents and new tools to some slightly unsettling questions about confidentiality and just how much these platforms already know, Mike and Marc discuss why AI probably isn’t something the industry can simply unplug.

It’s networking, market talk, AI, road-trip stories, cheese curds, and a few stories that may—or may not—have gotten better with each retelling.

In the CRE Vault with Mike and Marc is brought to you by NAI FMA Realty, serving Lincoln and the surrounding market with commercial real estate brokerage, property management, and advisory services.

Thanks for tuning in to In the CRE Vault with Mike and Marc—where we break down commercial real estate without putting you to sleep. Powered by NAI FMA Realty in Lincoln, Nebraska. For more, visit naifmarealty.com. 

Transcript

SPEAKER_00 0:07

Welcome to the podcast in the CRE vault with Mike and Mark. All right, welcome back to the vault with Mike and Mark.

SPEAKER_01 0:16

How you doing, Mark? You know, I'm doing excellent, Mike. It's great to uh I think my language this morning was I think let's get back in the saddle.

SPEAKER_00 0:24

Get back in the saddle. We're fresh off a road trip from uh Milwaukee. We went up there for a little uh uh Midwest regional conference, went to a brewer's game. I still have a food hangerover. I came back with two buckets full of cheese curds, and it seemed like a good idea at the time, but man.

SPEAKER_01 0:47

Those were good.

SPEAKER_00 0:48

Those were really good.

SPEAKER_01 0:49

I don't know if I've ever had a cheese curd, but that was uh that was a nice salty food. It was home run.

SPEAKER_00 0:55

If you're gonna have a cheese curd, you gotta do it in Wisconsin.

SPEAKER_01 0:57

Yeah, it was it was excellent. And it uh just as a recap, we we were we left on a Tuesday, Tuesday in the morning, and we were back in Lincoln on Thursday, early afternoon.

SPEAKER_00 1:09

Yeah.

SPEAKER_01 1:10

And and I can tell you I've it's an almost an eight and a half hour drive there. Drove on Tuesday, stayed on Wednesday, drove back on Thursday. There's very few humans, if any humans in this world, I've spent nearly 17 hours in a car with within three days. And that's not even drive time in the city of Milwaukee.

SPEAKER_00 1:28

Yeah.

SPEAKER_01 1:28

We were we were eye to eye the entire time. But I I do it again tomorrow. It was a ton of fun.

SPEAKER_00 1:33

It was a blast. We were like door-to-door curvy vacuum salesmen.

SPEAKER_01 1:36

Yeah, that's exactly what it was. Yeah, yeah. We were early, early 50s, uh selling McDonald's mixers, you know, just drove all over.

SPEAKER_00 1:44

Have you are you interested in in an encyclopedia set?

SPEAKER_01 1:47

Yeah.

SPEAKER_00 1:48

I'm selling, I'm selling B's and C's today.

SPEAKER_01 1:51

Yeah, yeah.

SPEAKER_00 1:51

Holy smokes.

SPEAKER_01 1:52

But but you know, true to form with any NAI thing. This is the second one that we've gone to this year. This was the regional, so Midwest region, uh, Petersoo City, Kansas City. We had some Ohio Ohio people there, and then um uh the Milwaukee group as well. But Fefferly, right? Yeah, Fefferly, yeah. And and they have five offices, I think one of them had mentioned. But um, this is the second NAI uh you know function we've been to. We went to Vegas in what was that, February. Um, but there's always a little bit of fun, yep, and there's always a little bit of learning.

SPEAKER_00 2:25

Yep, it was good. Got there, brewer's game, a lot of good uh networking, and just it's you know, I think, you know, as we're driving up there, it's it's good to be part of those. You know, it's it's a huge effort, you know, not that huge, but a big effort of a drive for a short stay. But I think we're both really glad we went. Um the the conference was good. Jeff Beals always does a fantastic job. You know, he can he can tell me the you know the same story ten times, and I'm not picking on Jeff, but I every time it's engaging. It is um I think it's you know, it's a good reminder for us experienced brokers, you know, not to rest on our laurels and and you know, keep um keep on our toes with different type of um you know pipeline stuff and you know prospecting. Uh he's he's very big on prospecting. Um and for the new agent it's just amazing, I think. You know, I think it's a deal where that could be really impactful for them, but a good reminder for us old guys.

SPEAKER_01 3:31

That is true. And you and you know, he he he goes in great depth about prospecting and the benefit of it. You know, we're in a smaller market, so I there's not a whole lot of prospecting that we can do. I imagine that's a a huge benefit in your Chicago markets and your your your first rate markets, but we're we're a little bit smaller, so it's it, you know, more than anything, uh it's just nice to see those faces because we work, you know, uh we get pretty in we uh our office gets pretty much uh confined to our box here locally, just because we don't see a whole lot of outside brokers come in um and and mingling with with under other NAI flag agents, but we do every so often, right? And it's nice to see those faces. Um, you'll see uh some faces at all the functions, so it's just nice to have those conversations and more than anything, just just understand that we're you know, if it's slow right now, it's not just our market, it's not our one's kind of feeling the same hesitation and paralysis.

SPEAKER_00 4:31

Um you know, we're seeing shorter options being exercised, even if you got a fixed five year, they might say, Well, you know, can I do two years? And I mean, most of the time your landlord's gonna want to keep a client shorter term than not at all.

SPEAKER_01 4:46

Yeah.

SPEAKER_00 4:47

And so it's just it's kind of a funky uh canary in the coal mine thing going on.

SPEAKER_01 4:53

Yeah, it's a it's different times. And every one of them, every conversation I had was, yeah, it's taken longer to get things done. It is almost like when COVID started. You know, we were busier than busy, but you know, it just took everybody was just pushing the rock down the road. And I and I think that's constant for for all people, all agents, all brokerages on on a national level. It's just different, it's wonky, and and just like when COVID started, they're just pushing the rock down the road, and it's really hard to get things across the finish line.

SPEAKER_00 5:24

Yeah, for sure. We have to get more creative. Um, but the good thing is, you know, seeing you know familiar faces and you know, colleagues, it just it makes it that much easier to pick up the phone and say, hey, I need help, and you know, I'll pick on Greg Brown, he's just a great guy. Um I need help with this in your area. And it's just it it's it makes the phone call so easy.

SPEAKER_01 5:46

It does. It does. And I think the one main conversation with everybody is is common at all these things is interest rates. You know, interest rates are high, um, you know, commercial lending rates are between six and seven percent. You know, I uh typically just having done this for so long, when interest rates are at about five five percent, the world rotates correctly on its axis, and and you know, they are a little bit elevated, and and I don't think cap rates have gone to where they need to be. Um, but just lending in in together all together is kind of hurting a lot of stuff. And and the one thing I noticed was multifamily. Um, it looks like a lot of multifamily stuff is is changing gears a little bit, and it's not as hot as it was. And I think banks are a little bit more cautious on what they're looking at, what they're lending for multifamily as vacancy levels rise and construction on on um well, new new new multifamily or even single family residential is is kind of keeping up with pace now. So I think that affects you know any multifamily complex and and and what that looks like.

SPEAKER_00 6:51

I agree. Um another big hot topic that was really top of everyone's list was all the AI stuff and and how do you implement it, who's using it, what's the platforms you like, and it's it's always good to kind of hear other people's experience and preferences with those things.

SPEAKER_01 7:11

I forget the guy's name, and and out of respect for him, this this guy was a home run. He was early 20s.

SPEAKER_00 7:17

His name is Win.

SPEAKER_01 7:18

Yes, and that guy Winnie the frickin' poo. He was the I mean, he was the smartest man in the room. I mean he knew, yeah, he knew everything he was saying, and he was a Marquette, I want to say he was a junior or something at Marquette University because that's where our um that's where it was at, and that's where it was held. And this guy, you could ask him any question. And he, I mean, he went into great length about what agents are inside the AI platforms, how they can work for you. And you know, he he had uh a ton of questions go his way, and he just rattled off every answer. He had a he knew everything about it.

SPEAKER_00 7:56

Yep, he'll be uh he's like on the the ground floor of this, it seems like, and he's I think he's gonna go places. He seemed like he was a very sharp kid.

SPEAKER_01 8:07

Yeah, yeah. And so it was it was nice to see um a few, they had a panel of a few people up there, and and uh they just talked about AI, where it's going, what's new. And I, you know, we we sit through a lot of those AI uh speeches at these conferences, and it's all kind of the same. Nobody really knows. No, I felt like it was Yahoo internet in the 90s, you know. Netscape. Yes, and and nobody knew what it was, or my space, you know, which I think that's coming back around. But I I don't think anybody knew exactly what it's gonna be and what it's gonna be next year. The the the one thing that everybody's cautious with, the growing growing caution I think is is confidentiality. You don't wanna you just wanna make sure that none of that you don't have any you know confidential information hit hit uh through the AI any AI platform because it we don't we I don't know if we're sure where it goes.

SPEAKER_00 9:03

Yep. I think that's the biggest hesitancy from any firm right now is I don't want you know uh confidential stuff getting leaked or seen. And so that's you know, I think in terms of our firm, that's our biggest pump of the brakes for doing certain things.

SPEAKER_01 9:21

I have, I'll give you a reference. I have a I have a couple properties that are are coming to market, but we haven't even broke ground on building the buildings, and so it's it's all just very, very preliminary. We don't even have a permit for the buildings yet. And I was Google, I was, I was, I was on the AI platform, I was on Claude a couple days ago, and I was asking some questions about some industrial cap rates and just where it was at because I I do that daily, and those two buildings popped up on the AI platform. So somehow along the way, um, it had access to and it it it listed the two addresses, and I I I it wasn't anything with my my doings, um, might have been with ownership's doings, but either way, uh AI knew more than the average human. That's scary.

SPEAKER_00 10:10

Yeah, it is, but it's you know, it's the new, it's the new norm.

SPEAKER_01 10:14

Yeah, and I it it you can't pull the plug on it now, so nope. Yeah, you you adjust and acclimate, and I think there's no switch.

SPEAKER_00 10:21

We've said that before. You can't turn it off.

SPEAKER_01 10:22

Yeah, that's very true. That's very true. But um, you know, it was a great trip to Milwaukee, and and I and I'd do it again. There was there was a lot of laughing, there was a lot of storytelling, there was a few lies told, there was some there was some mustache feeling, you know. I mean, it was uh oh, there there was a little bit of tumbling on some on on some chairs, and uh it was it was a ton of fun. I do it all over again.

SPEAKER_00 10:45

It's never a dull moment. And Mark and I have been to Milwaukee, Vegas, Chicago, Chicago, where else?

SPEAKER_01 10:54

Vegas, Minnesota, Minnesota, and uh yeah, now Milwaukee and then Chicago. So I think we're good traveling partners. Yeah, we are very good traveling partners. I don't even know if I've traveled that much with my wife, but uh I definitely know I don't think I've sat in a car with her for that long. But uh it was a great time. I wouldn't have changed anything on it.

SPEAKER_00 11:11

So no, and thanks for going again. That was a great time. Yeah, thanks so much, Mikey. We'll see you next time. See you next time down here. See you, buddy.

SPEAKER_02 11:31

The views, thoughts, and opinions expressed are the speaker's own and do not represent the views, thoughts, and opinions of any high FMA realty. The material and information presented here is for general information purposes only. Any high FMA realty disclaims any liability or responsibility for any individual's views or reliance on the information presented in this podcast.