Breaking Into Commercial Real Estate in WI (Without 25% Down)

Corey Reyment sits down with Mason Clark, Chief Investment Officer of Park Place Holdings, to break down what commercial real estate investing actually looks like in Wisconsin.

From negotiating a $17 million listing down to a $2.5 million purchase… to turning a vacant 150,000 square foot office building into a multi-tenant value-add opportunity… this episode is a real-world look at how commercial deals get done in markets like Green Bay, Appleton, and Northeast Wisconsin.

You’ll learn:
• How to structure commercial real estate deals creatively• Why you don’t always need 20–25% down to get started• How value-add commercial investing works in Midwest markets• The difference between residential and commercial underwriting• How cap rates, lease structures, and long-term holds actually play out• Why relationships with local banks matter more than national lenders• What it takes to scale from small deals to nine-figure portfolios

This is not theory. This is how real Wisconsin investors are building wealth through office, retail, redevelopment, and strategic acquisitions.

If you’ve ever wondered whether commercial real estate is “too big” or “too risky,” this episode will give you practical insight into how experienced investors evaluate risk, negotiate deals, and create long-term cash flow in steady Midwest markets.

Whether you’re investing in single-family homes, duplexes, multifamily, or looking to move into commercial real estate, this conversation will expand the way you think about opportunity.

Connect with Mason:mason@parkplace-holdings.com

Looking to invest in Wisconsin real estate?Visit wisconsindiscountproperties.com for off-market opportunities and investor-friendly deals.

Subscribe for weekly conversations with real investors doing real deals in Wisconsin.

Transcript

Welcome & Mason’s Background

SPEAKER_01 0:40

Welcome back, everybody. We have another awesome episode of the Wisconsin Investor. And I know it's awesome because I already this is all pre-recorded. So I am I'm doing this. No, I'm just kidding. I just know Mason, Mason and I are going to on our rift today on a little new topic that some of you guys maybe haven't had us on here talking about today. We're going to get into some commercial real estate investing conversations. If you're not into commercial real estate investing right now, but you're interested in maybe someday getting there, hang on. If you think, man, I'm never going to be able to get into that space. I'd still encourage you to hang on because I know Mason's got a ton of great knowledge that he's going to be able to drop here. Not just on commercial real estate. The guy's also involved in other businesses, and there's going to be a lot to unpack here today. So with me today, guys, I've got Mason Clark. He is the chief investment officer of ParkPlace Holdings. This is where he leads commercial real estate in the operating company investment strategy. So he's overseeing acquisitions, dispositions, underwriting, capital structuring, portfolio performance all across. They keep adding deals all the time. And you know, a lot of focus on the value add opportunities, which is the area I like to play in in real estate as well. And they're focused mostly in office retail, some development and redevelopments. Um, Mason, you've been in this, what, seven years plus now? Is that right? Yeah. Yeah. And uh check this out, guys. They have built at ParkPlace Holdings assets worth well over nine figures. That's like a lot of money. That's like pretty big. That's a big number, dude. Uh so that's pretty awesome. I don't know that I've had anybody on yet that's playing in the nine figure game, so I'm pretty excited to have you know unpack that a lot. But they, you know, you guys have done it. It sounds like from, you know, the the you guys have a system it sounds like you follow. You've got some creative deal structures, you guys are pretty hands-on, and and then you're involved in other op your operating businesses and owning businesses. So I'm excited to unpack all of this today, Mason. And uh, we got a couple deals we'll break down here today as well. But man, tell us that's a lot. We just uncovered a lot of stuff here, man. How did how did you go from what what we just unpacked there? Like, what were you doing before the seven years ago, Mark? And you and you got hooked up with ParkPlace.

From Flips To Commercial Strategy

SPEAKER_00 2:53

Yeah, so just kind of a quick recap. So prior to joining Caleb, I was a financial advisor. So I was doing that for a couple years. I did it for a couple years actually in college, more of an insurance agent in college, but from there uh was in lacrosse. Business was growing up here in Appleton. Uh, so I decided to partner with a firm up in Appleton. And then from there, uh, one of my clients had introduced me to Caleb, uh Hope Graf, and uh she sold us our house up here actually, and just saw we had very similar energies and synergies, and so she put us in a room together and the rest is kind of history, I guess.

SPEAKER_01 3:34

Man, so it all only takes that one connection to completely change your life, huh?

SPEAKER_00 3:38

Yeah, yep. Yeah, so I was approaching that uh intro more on the uh financial advising side, and then it just kind of transformed. I'd always been interested in real estate and was kind of evaluating deals and trying to get into my first deal at the time, and um thought he could possibly be a money partner too, and uh took a little bit different turn than I originally thought, and ended up working out.

SPEAKER_01 4:02

So that's amazing, guys. So, for those of you guys that don't know, Caleb Hayes is who Mason's talking about. Caleb owns, and how I met Caleb was he he owned the Keller Williams brokerages in Green Bay and Appleton when I met him. And um, man, he was one of our first mentors. Like I still reach out to him every once in a while, which is which is gratitude, because he just selflessly mentored my wife and I in in real estate and got us really started um and running a business, not just uh investment, just doing investments. You know, he really taught us some principles of how to run a business and um forever grateful for that, man. But tell me a little bit, uh now he's obviously you guys are running this nine-figure business. He's gone from flip, he was doing like at the time, I remember he's like one of the biggest dudes in flips. He was this is like 2016, 2017. I remember he was like doing like 40 flips a year, and I was like, oh my gosh, how could how is he doing this?

SPEAKER_00 4:56

I think at the I wasn't involved on the flip side, but I think at the most they were doing 50 to 60 at one point. So yeah, it blew in pretty good. And then I think just kind of throughout my time there, we've just kind of we constantly review the business, what's working, what's not working, what makes sense to continue working on. And that just kind of was one of those things where we analyzed the profitability of it and where the cash was going and realized commercial was just the direction we wanted to take the company, and so we eventually phased out flipping as a whole, um, probably in 2019. Okay. 2018, 2019, somewhere in there, a little after I joined, we ended up phasing it out.

SPEAKER_01 5:37

So yeah, took all of that knowledge and project management skills and everything else and just added a couple zeros to the back end of what you guys are doing, huh? Right. Yeah, that's actually take me back to that conversation you and Caleb had, because I'm interested in this because what's interesting about you, Mason, is Caleb owns the the overall the park place, right? And you're now now your partners or however you guys have the structure, but at the time he owns this He owns this entity. You come to him as a financial advisor, right? Who also enjoys real estate. Um what I think is great about this is there's a lot of people that listen to this that maybe don't want to be the guy to like carry that load of owning the everything and have to be the you know the CEO, so to speak, but they want to be in this game, they still want to, they still love real estate and everything else. How do how was that conversation? How did Caleb pitch this to you back then to kind of paint this vision of what it's what it is now? And what was that conversation like back then?

How To Start In Commercial

SPEAKER_00 6:35

Yeah, when we first met, it wasn't really uh it wasn't really a pitch either way, it just kind of transformed into it. So I had kind of like I said, I was I was wanting to break into real estate. And we had done personally a couple of live-in flips, I'll call them. Okay. And so I knew I wanted to get into a little bit more long-term hold, but I didn't, you know, didn't really know what I was doing. And so uh yeah, basically the conversation similar to what you said, is he was open to kind of talking, being a mentor, and uh he oh, we always joke about it because uh I I'm an early riser, and so he always jokes that I kept bothering him at 3, 4 a.m., sending him stuff, and he he uh said at that point he kind of knew that he wanted me to be a part of the team, and so then it transformed into having that type of conversation. And yeah, I mean he paints a a very good picture of where he wants to take the company, and um at the time we really didn't they had owned a couple commercial buildings, uh uh pretty much the Keller Williams offices and I think one or two buildings outside of that. And so we didn't really have a specific direction on the commercial real estate side where that was gonna go. And so he was taking a little bit of risk on me coming in and helping him grow it. Yeah. So we yeah, since then we just kind of work side by side and doing our best to take us to the next level.

SPEAKER_01 7:59

Awesome, man. So did you come in with the intention to grow the commercial side of things, or was it just bring this guy in on the team because I think he jives well and culturally he's a great fit? Or what was the what was the um intention with when you got hired? What was that looking like?

SPEAKER_00 8:16

Yeah, it was a new position. So it I think it was just commercial asset manager, I think my original title was. So yeah, basically come in, try to help lead acquisitions, grow the company, and um at the same time I was doing leasing and property management and stuff, kind of the whole the whole thing for you know from start to finish with buying a property. Okay. So yeah, that's how it started. And you know, since then we've changed it up a little bit, but yeah.

SPEAKER_01 8:45

Still kind of the majority of what you're still still kind of doing the same gig?

SPEAKER_00 8:50

Yeah, I don't handle, I don't have as much hands-on with the leasing side. Okay. Um outside of the financial, we'll we'll analyze some of the the details of it. But we have uh leasing agent in-house, um, Lauren LeRoy is on our team, and uh operationally Annie Sean Walder handles most everything on the operation side for the management and Beth Phillips uh operationally as well. And then we have Amy tests in-house for accounting, so that's uh the extent of our team. We have a couple um couple people who help with acquisitions um kind of on the side as well. But okay, yeah, other than that, that's how it's transformed. And so I kind of oversee just most of it now rather than being two hands-on day to day with it.

SPEAKER_01 9:37

But awesome. So if you were to start out today, Mason, let's talk about this because you you know, people think about commercial and I think it's scary, right? It's a scary world. It's an unknown, I I don't know why it's even in my brain, I have like limiting beliefs or like roadblocks and mentally of like, oh man, getting a commercial property. I don't know about that. But I can do a multifamily. I know how to underwrite that, I know how to do that. When you're looking at a property, like if you were starting out brand new, you know, you you and Caleb were connected, it was just gonna be Mason and his family starting out this commercial stuff. Like, what would you do starting out? Like, how would you do that? How would you learn how to underwrite these, how to look at the risks, the rewards? Like, kind of give me a give me a little lay of the land in in brief of day one for somebody out here listening to this that's like, yeah, the commercial thing sounds kind of cool.

SPEAKER_00 10:24

Yeah. That's a tough question. I mean, commercial is a lot different than residential. I mean, the biggest thing that people get a little turned off by is just how fast or or how long I should say it takes to find a tenant, right? Because residential, everyone needs a place to live. So as long as you have a decent house and somewhere for someone to stay, like you should be able to find a renter, you know. And so commercial is a little different where you can have vacancies for you know two weeks or you can have them for 24 months. So yeah, underwriting plays a big role in how you do that. Um, a big part of it, just like with residential though, is like as long as long as you're accounting for vacancy and kind of setting money aside to prepare for those times, you know, it it it makes it a lot easier. But um, yeah, as far as underwriting goes, it's a big part of what we look for is just location. So you want to have a property that's in a good location that people want to be. So we we've had deals where location isn't great and we're feeling it where we can't find a tenant to put put in there. So yeah, location plays a huge role. And then you know, anything on the main court or like if you can get something relatively inexpensive now that's on like College Aven in uh Appleton or Oneida Street in Green Bay, like if you can get something relatively cheap and it can be redeveloped in the future, like those are those are game changer properties to the commercial side. So yeah, location's huge. And then um when you're underwriting, if you have current tenants, you need to make sure that lease rates are within the market. Because if you have someone that's paying, say,$20 a square foot and market rates are$15 a square foot, you're more than likely either gonna have someone ask you for a rent reduction in a couple of years, whenever the lease comes due, or you have to take it back to market, you're gonna be losing money from that point too. So yeah, there's a lot, there's a lot to pack with commercials. So it comes down to uh just finding someone being a mentor, kind of like you already talked about with Caleb and he's helped you out a little on uh on your businesses and stuff, just finding someone that has that experience because and we could probably talk about underwriting a deal for a couple hours and everything that goes into it will we look for, but yeah, we don't have quite that much time.

Location, Traffic Counts, And Tenant Fit

SPEAKER_01 12:34

No, but we we could keep going with it a little bit because I think we're I think one of the things you mentioned was location, right? So what are the factors for location that you're seeing are gonna make or break a commercial property?

SPEAKER_00 12:47

There's yeah, it depends on the asset class too, right? So when we're looking at when we're looking at redevelopments, a lot of times we're looking for specific clients or specific tenants. So a lot of the quick serve restaurants we've developed Freddy's Frozen Custards and Cousins Subs and Squeeter's Coffee, Caribou Coffee. And so those uh types of tenants typically have specific requirements that they need. So per day on this on the roads, so they need to see a certain amount of traffic count. Some of them like hard corners on stoplights, and so they they kind of have their own buy box essentially for us to look for. But if you're looking at like retail, that's I mean, you want to have just good traffic flow and a good mix of tenants for them to feed off of each other. And so yeah, it it just comes down to you don't want to be, you know, uh not necessarily downtown Green Bay, but you don't want like a retail building within a bunch of residential houses, yeah. Yeah. Um, so yeah, we tip we look a lot at traffic counts, make sure you know it's it's not um traffic counts aren't going down year over year, and and because a lot of times, like in the pier, if they're changing traffic patterns with the bridge there, um that impacts the value of real estate because you have less people going by in certain areas. Okay. So it's just we try to make sure we're paying attention to traffic patterns and what that looks like because people want to be seen when you're renting space. Right.

SPEAKER_01 14:17

So that's interesting, man. So where do you like if I I'm so ignorant in this space, Mason? This is I think I I love this because I'm gonna learn so much today, and hopefully the audience was too, because I just am like I am kind of dumb in this space. Where where would someone go find traffic counts? Like, how do you how do you get that information?

SPEAKER_00 14:33

Yeah, it's it's right on the DOT's website. So in DOT, you can go right on there and uh you can pull up the map, search your specific address, and um it'll pull up the traffic counts for any street that you can that you can think of.

SPEAKER_01 14:47

So and you can go back, just go, okay, we're gonna go back to 2025, 2024 and see what it did. Yep. Cool. Awesome, man. Wow, that's really good. So that's the main thing. Now, when you said redevelopments, I'm always I've always been interested in this when I see like, you know, in in Bellevue, for those of you around the Green Bay area, a lot of development going on there, right? By Costco, and you've got a lot of the quick serve stuff, the culverse and all that sort of stuff. So, how does this work? Do you go buy a lot and then you go pitch it to a place like Culver's, or do they approach somebody like you and say, hey man, we want to we want a location in this area, go get us something to build it and we'll lease it from you? Or like what is that how what are the dynamics of that and how does that typically go?

SPEAKER_00 15:26

Yeah, we uh I mean we have different relationships with a lot of different clients like that. So some of them that we have long-standing relationships with, we'll say, Hey, we're looking in this town or this city, we need XYZ for requirements for um corporate to improve it. And so then we'll go out and try and look for that. Okay. Um other times we'll if we stumble across something that we feel might be a fit for one of them, um, we'll send it off to them just directly before we try to get it under contract just to play kind of on the safe side before pitching it. But uh yeah, so we'll we'll sometimes get land under contract and then pitch it. Otherwise, we've pretty good relationships where we can just send addresses and stuff and and they'll review it and give a quick yes or no. So cool.

SPEAKER_01 16:11

So you did you say you guys did one for culvers?

SPEAKER_00 16:14

Uh not culvers, Freddy's for Freddy's.

SPEAKER_01 16:17

Sorry, sorry, sorry for sorry for my Freddy's fans out there. Sorry, Freddy's fans didn't need to mix those up. Uh so let me use this as an example. So did Fred in this case, did Freddy's approach you guys, or did you find the land and then approach them, or how was this, how did this one go down?

SPEAKER_00 16:34

Yeah, we originally approached them um for our first one with them. Yeah, so we had it was the old Pizza Hut on uh College Ab in Appleton. That's the first one that we did for them. Okay, so we tore most of the building down, um kept some of the footprint, but pretty much tore the whole thing down and built it brand new for them.

SPEAKER_01 16:56

So they give you, I'm getting I'm guessing they give you the specs and say this is what we want build, and then you guys basically GC that for them. Is that how that works?

SPEAKER_00 17:05

Correct. Yep. Yep. So we have yeah, we we have Ben Witt um from Witt Construction kind of in-house. He does some third-party stuff as well, but uh, he's basically our general contractor that handles he's awesome, does a great job. Like since we brought that back in-house versus doing third party, and we've saved millions of dollars on construction and build-outs and compared to what we were doing before. So that's been a huge change in our in our process.

SPEAKER_01 17:31

That's awesome. Well, it makes you a lot more competitive, I'm sure, compared to some of the other guys out there, too, then that aren't doing that. So that's awesome, man. Yep. So you build it now, you're making you're making a spread on that construction cost, or are you leasing it back to Freddy's then after? And you're the one keeping keeping the note or whatever it is on the on the construction in the building.

Redevelopment Model And Triple Net Leases

SPEAKER_00 17:50

Yep. So we have the debt and uh yeah, they they lease the building from us typically typically triple nets. Um so we'll pay basically taxes insurance, and then they reimburse it through cam payments, common area maintenance payments. Um we did one recently in Ashkash, and we actually just sold it uh two days ago we closed on it. Oh we sold that, yeah, thank you. And um, that one was more of an absolute net lease where they're paying all expenses directly to the municipality for taxes or insurance, which makes it a lot easier um for the owner of the property.

SPEAKER_01 18:31

But nice. So then with these, are how long of leases are these are these guys like a Freddy's, how long are they signing for? And uh I imagine there's annual increases, and how is that how is all that structured typically?

SPEAKER_00 18:42

Yeah, it all varies. I mean, if you get a corporate user, they're probab they're typically a little more um firm on the terms that they have to see, but a lot of the times when you're working with franchisees, there's some flexibility. So Freddie is I would say they're typically about 15-year terms. And uh we've had it with them before we've where we've done annual increases, uh, or a lot of times it's common for it to be like a five-year fixed, and then year six you have an increase, and then five years fixed, and then year six is an org and eleven is an increase. So that's pretty typical. Um, but yeah, I it very each kind of varies a little bit. It can be anywhere from 10 to 20, sometimes up to 25 years, I've seen.

SPEAKER_01 19:27

So what are you guys seeing for numbers on these? You know, cash on cash returns or cash flow, or what is that uh, you know, what does that typically look like for what your targets are when you guys are are looking at doing one of these?

SPEAKER_00 19:39

Yeah, so redevelopments are a little bit different. We typically don't go into them planning to hold them. So we we kind of plan worst-case scenario where it's like it's gonna cash flow for us, but it typically doesn't meet our long-term full returns that we want to see. Okay. So more often than not, we have a couple still in our portfolio. We have the cousins and scooters in Appleton that we're still holding. Um, but like the Freddies that we just sold, I mean, they they generally cash flow two, three, four thousand dollars a month for us. And uh what we look at is basically what what profit we can create from it and how long it takes us to generate that through cash flow. And if we feel like it's more advantageous for us to take the profit and roll it into a long-term hole that's gonna pay us more, that's that's kind of how we make our decisions.

SPEAKER_01 20:26

Got it. So this is what this is your new flip now. You guys, instead of doing the old single family house, you're just building you're building new, new uh commercial properties and then flipping that to somebody like a I would imagine some kind of fund or something like that is buying these up, insurance companies or something else.

SPEAKER_00 20:43

Yep. Yeah, yeah, pretty much. Cool. So now you're basically instead of doing a couple houses and taking 30,000, 40,000, 50,000 in profit, you're 10 times that on one deal. So you make it a little bit easier. Nice. That's awesome.

SPEAKER_01 20:57

So so how how many of these will you guys do in a year? And like what's the you know, start to finish of a process like that? What's the timeline? Because again, you could do a house in say eight weeks. I I imagine this process is is bigger spreads, but much longer process. So, what is that timeline typically looking like for you?

SPEAKER_00 21:16

That it varies again. I mean, uh by the time you get someone to say yes to a site, I mean you need 30 to 60 days to close on if you don't have it. Um, and then from there, construction can be with getting plans approved from the state, it can be anywhere from uh six months is pretty quick, but nine to twelve months we typically try to plan for um the construction and completion and delivery phase. So yeah, I mean you before you can really finish it and sell it, you're probably 12 to 18 months in by the time you sell it and close on the sale of it. Cool. I mean, we try to do a couple a year, but it the market varies. So I think the most in any given year we've done is five. Okay. Um so yeah, it it just depends.

SPEAKER_01 22:09

But awesome. Nice, man. Oh, that's cool. I I have never understood that whole world. I see all this stuff going up and I'm like, how is this working? Is culverse buying this building or somebody else building it and they're just leasing it back? Yeah. Oh, yeah. I've always been interested in that. Well, dude, that's great. Talk about like so that that is kind of more of the uh generating cash play for you guys, right? Correct. Talk about talk about your what's the long term buy and hold strategy for you guys? What does that look like?

unknown 22:37

Yeah.

Deal Volume, Timelines, And Exits

SPEAKER_00 22:38

So we some people like to focus on cap rates and some people don't. We do because it gives us a general idea of what to expect for cash flow for a property. Um, because we have our typical financing structure that we use, and so we can kind of work it backwards pretty quickly once we have an understanding of what cap rates look like. So yeah, we look at cap rates, and typically we want to have a property that is operating north of 10% cap rate. So if you're looking for some simple terms, if you're looking at a million-dollar property, you want it to kick out 100,000 in net income before we do that. So that's kind of our like our minimum. Um, I would say our portfolio as a whole is probably operating around a 12% cap rate. Um so yeah, that and then how we structure financing that varies. I mean, we're very we like to hold on to our cash. So we try to be as creative as we possibly can. Um and so that's that's where I really enjoy playing, is just how can we structure something creatively that you know we have to come with as little cash down. And so I I push the banks really, really hard. Um, and so I I enjoy giving those guys a hard time to try and give us uh give us as much as they can.

SPEAKER_01 23:53

Yeah. What do you see? And like what are some of the bank terms you guys are able to negotiate on some of these things that allow you guys to keep more cash in your pocket?

SPEAKER_00 24:01

There's a bunch of factors in that as well. I feel like a broken record saying that. But commercial the cool thing about commercial is there's like you can people get nervous about it, but you can be as creative as you want. Yeah. So banks, every bank's a little different. Like credit unions are different than you know, a small local bank, than a you know, mid-sized regional bank, and then completely different from the large chain banks, like the US banks and Los Fargos and stuff. So everyone kind of has a role within the industry, but um you know, you're gonna probably be the most creative on the smaller local banks, you know, the Bank of Luxembourg's and uh uh Bank of Cacana is the one that we've worked with before, and so um Premier, Lucas Over at Premier, I've worked with before. So yeah, everyone's a little bit different, and every uh uh credit company or every credit division for each bank is a little different too. Yeah, board of directors is a little bit different too, and in what they're gonna allow and approve. So depending on like if you get a really good appraisal on the front end, sometimes you can get into the deal with no cash down, 10% cash down. It's not always like when I first got into the industry, like I didn't know what I didn't know at the time. Right. And so I asked people that I knew who were in like mortgage or who were um who I thought knew a lot about the industry. And early on, everyone said, Oh, you need 20, 25 down cash, and there's no way fans or buts about it. Well, that just so happened to be just that one company who didn't really do much with commercial real estate. Yeah, so um, yeah, it especially if you're a little more seasoned in the industry, like there's a lot that opens up to you for sure. Even my first personal deal was an office deal, and uh, I worked with Jake at Bank of Luxembourg on it, and I got into it with the seller paying me to take it over. So that was my very first deal.

Buy‑And‑Hold Criteria And Cap Rates

SPEAKER_01 25:57

Wow. Well, let's break that one down, man. Let's get to that. And I think this is so good because uh what you just talked about, Mason, for the audience out there. I can't tell you how many times I talked to people who want to get into real estate investing, and that's their realtor told them they need 20 or 25 percent down if they want to do if they want to do investment real estate, and that's the only way they can do it. And I can tell you what, I've I've literally never bought a property with 20 or 25% down. I couldn't tell you, at least of my own money. I maybe borrowed some private money if I needed to for a deal, but 99% of the time the bank is funding some part of that rehab budget, or the seller is carrying back a piece of it and the bank is funding the other piece. Like again, like you said, cash is king. And there's there's lenders out there right now that will do 80% of the after repair value on single family, duplex, four unit, whatever, which means, like what you're saying, you can give them a scope of work. Here's what I plan to do to the property. They send they send their appraiser and appraiser says, okay, it's gonna appraise for$100,000. And the bank goes, okay, great, Corey, we'll give you$80,000 for this project. I'm like, awesome. I'm only buying it for$50,000. This is great. I got$30,000 from the bank I can play with now to rehab this property, and I still have a$20,000 equity spread. Those are the types of things that I think people who aren't listening to this podcast or aren't educating themselves, they're only they're stuck with somebody who's only knows of the traditional way, they're really limiting the amount of growth they can have. Because there's no way you guys could get to nine figures with putting 20 or 25% down in every property.

SPEAKER_02 27:28

Right.

SPEAKER_01 27:29

You would have to have one heck of a cash machine to be doing that, right? So talk about this deal that you're talking about here. This this first one that you got into. Tell us about how you got it, what was the structure? How did that all go?

SPEAKER_00 27:41

Yeah, it was uh office building up in Green Bay, and uh just at the point where I was wanting to do something on my own. So I was a couple years with Caleb here and you know, buying stuff in our his portfolio, and so I found this deal um and knew I couldn't put a bunch of cash into it. And this value add, the seller was out of California, and she wasn't maintaining it very well and and trying to make it a little bit shorter here. But I knew Bank of Luxembourg had the note and we know them really, really well and done a lot of business with them. And so I approached them and just said, Hey, can I take over the note and take over the property? Because the seller just wanted to basically get out. Okay. And so they it took them a little bit, but they ended up uh agreeing to it, allowing me to take it over just on a one-year term to basically add the value and refinance it. And so uh I was able to get the seller to give me a credit at closing, and that paid their broker and all the closing costs, and then it gave me um I was gonna pull it up, but I forget exactly how much it was. I think I was left over with like$115,000 to basically get tenants in there, rehab it a little bit, and um yeah, refinance it. So wow.

SPEAKER_01 29:05

So this seller wrote a check for like$150,000 to sell her property.

SPEAKER_02 29:11

Yeah.

SPEAKER_01 29:12

Wow. So that was always one of the things I've struggled with is like if if you're taking over a note and they're not actually getting any cash, how do you get them to give you the seller credit? But she just was motivated, huh?

SPEAKER_00 29:23

Well, she and they were losing or she was losing money on it every month, and so she just wanted to be done with it. Wow. So yeah, I was able to negotiate that part of it and yeah, turn it around. Awesome, dude.

SPEAKER_01 29:37

So there you go, audience. People will scratch checks to sell properties, okay? There it is. Yeah, we we've had that on a super common.

SPEAKER_00 29:44

No, we not super common, but we've had that once or twice.

Creative Financing With Local Banks

SPEAKER_01 29:47

You know, we had somebody same thing. She owned a business and then she had some duplex or something, and the thing that was really, really bad, and she needed to get out from underneath it. And like the number that we could give her was like 20 grand less than what she owed. And so, you know, this is just good for you guys out there trying to negotiate some of these things. Never assume just because somebody owes something that you're you have to bend on your number to try to meet that, right? Like stick to your due diligence and your underwriting and your number's your number, and people will bring cash in cases or they'll figure out a way to get it sold if they want it sold bad enough, right? Yeah.

SPEAKER_00 30:21

Motivation's a big factor in everything, right? So you don't ever want to be a motivated seller, but you want to find the motivated sellers. That's right.

SPEAKER_01 30:30

Yeah, you want it's right. That's why cash is king, right? Because if you got that cash still, that dry powder still laying around. You can you can use that to help out with some of these motivated folks, right? Yeah, exactly. That is awesome, dude. So do you still own this property today, or did you end up refinancing it, sell it? Still got it?

SPEAKER_00 30:46

Still have it. Yeah, I did. So I did refinance it, added the value, um, refinance it on a longer term, longer term note and still hanging on to it.

SPEAKER_01 30:56

Nice. Were you able to pull cash out at the refi as well, or was it just uh gosh, that's a good question.

SPEAKER_00 31:04

No, I okay. Actually, here's what we didn't. I just I don't know why I didn't think of this. So I used it and leveraged um the equity that we created and bought a smaller um single tenant retail building. Bought the second building with no cash on as well.

SPEAKER_01 31:19

So that second yeah, so that second building was because you had forced enough equity that the bank's like, hey, we'll take a second on this in lieu of a down payment over here. So they didn't need cash, they just took a note basically. Yep. So cool, man. I love that stuff. Listen, a lot of people's minds right now, Mason, are blown right alcohol. They're like, wait, like, wait, you can do that? What? Yeah, I've never heard of that. Yeah, we did we did something similar. We my first 16-unit apartment that I ever bought, I don't remember what I used for leverage, but I had I had a good amount of equity maybe in a couple duplexes or something like that. It was the same thing. I was like, how do I get into this with no money to my banker? The guy's like, well, you got equity in something else? I was like, Yeah. And he's like, Oh, let's take it, we could take a note on those, and and I'm like, wait, you just give me a piece of paper at S sign and I don't actually have to bring any cash, like actual cash? He's like, No, we'll discount it as as part of you know down payment. I'm like, this is unbelievable. What in the world? So we got into a 16 unit apartment with no money. It was great. Yeah, that's the power of just getting going. Yep. You can't do that though unless you got assets to do it, right? And it only took you one. It just took you one good deal that you did it right and forced the appreciation and bada boom, bada bang, it parlayed that, monopolied that right into another one, man.

SPEAKER_02 32:32

Yeah.

SPEAKER_01 32:33

That's so cool, dude. I love that stuff. Let's break down a couple other deals. You know, you sent me over your your best deal you you guys have ever done, and that was an office building in Hudson. So tell me a little bit about that one.

SPEAKER_00 32:46

Yeah, so like I mentioned earlier, we have kind of adjusted the business just over time, right? So at one point, a big push that Caleb was trying to make is we wanted a lot of brokerage offices. Okay. So we had we had bought one over in Eaton Prairie, Minnesota. Um Eau Claire, we had one, and so we kind of expanded where we're looking for buildings. Hudson's on kind of that that part of the state, the western part of the state. Found a really good uh deal on an office building there. And um Kelly Williams agent, I was I think he was just occupying space there for another one of his businesses, and so we basically negotiated it and didn't we got into it and didn't really do too much to it. Um and we had another cool thing about commercial is you you know, there's private equity companies out there that basically have money to spend, so they're motivated buyers. And so a handful of months into the owning of the property, um, just wereached out by one of these large companies that needed to place some capital and um yeah, I mean the rest was history. But this one, I mean, our holding period was like eight or nine months, and uh I mean, we almost almost doubled the price that we paid for that property without having to really do too much to it.

SPEAKER_01 34:10

Wow, that's awesome, dude. It just that you guys weren't you guys weren't shopping, they just approached you out of the blue. Mm-hmm.

SPEAKER_00 34:17

Amazing exactly. So wow.

SPEAKER_01 34:20

So that gives you some more dry powder then, right? To go put into some of these other acquisitions and refinance back out, pull that dry powder back out, go do it again, right?

Mason’s First Deal: Paid To Take It

SPEAKER_00 34:29

Yeah, yeah. So that one is, I mean, financially definitely our best, our best deal based on the holding time. Yeah. So it's but it was just one of those things, kind of right place, right time. And yeah, ended up working out. Hard to replicate that ever over and over again, right? It is, yeah, yeah. And yeah, we don't for our office and retail stuff, we don't typically plan to exit them. We plan to hold them long term, but the only time we ever will sell something like that is if we just get an offer that you know, we we wouldn't be able to get in another 10 years from appreciation or for sure. So we uh yeah, that's the only time we typically will exit our long-term holds like that.

SPEAKER_01 35:08

Nice. Awesome, man. Let's take a good one, dude. Let's talk about your favorite deal. So this was uh a new office acquisition in 2025. Tell us about this one.

SPEAKER_00 35:17

Yeah, this was our Packerland deal, the one on 3500 Packerland. So we uh huge building, 150,000 square feet, was occupied by American Family Insurance as a single other.

SPEAKER_01 35:30

Yeah, I know exactly where this is.

SPEAKER_00 35:31

Yep. Yep, by the hockey rink over there in the Schwabinon fields. So they they weren't renewing their lease. Uh was owned by a large uh REIT, real estate investment trust out of Phoenix. Okay. And so they had occupied the whole building as one of one of their other main data hubs outside of their headquarters in Madison. Um, so huge data center in it. And the Reed brought it to the market. Um, and the IFF really had it for sale. We know them really, really well. So we just kind of got talking to them and they just said they're guiding the price around I'll use real numbers, is around 17 million, which was what it was assessed per the municipality. Okay. So like, well, we're not gonna buy 150,000 square feet vacant office uh for 17 million. And so we ended up just going into it and said, okay, we'll pay two million dollars for it. Two million, two million dollars, yeah. So uh they countered back, and I think they came down to three and a half million right off the bat.

SPEAKER_02 36:38

What?

SPEAKER_00 36:38

Yeah, so at that point we're like, okay, they're we know they're motivated. So we uh came up a little bit, said we'll pay two and a half million cash, and they ended up taking it, and we were able to take it over, and yeah, wow, yeah, dude.

SPEAKER_01 36:54

That's incredible. Oh my gosh. Okay, so when when was this? This was last year. This was January of 25, yeah. Okay, so it's about over a little over a year now you guys have had this thing, okay? Correct, yeah. And now is this only for who what's all in the building now? Is it just KW office or what's in there now?

SPEAKER_00 37:12

Yeah, so that's a good question. So we ended up moving our office there, Park Place Holdings. So before we were at our Eisenhower building, just kind of co-mingled with Keller Williams at the time. And so we ended up putting our office there, building out a very nice space that Caleb designed. Uh, and then Keller Williams has now since followed. And I don't think they're they're not quite in there yet, but their build-out is is done, and so they're gonna be in the building as well. We've got a couple other other tenants, but the bigger part of the story there is um the church that Caleb goes to, Destiny Church. He at the same time, they were kind of looking for uh looking to do an addition out to their building. Yeah. And so we just kind of he started a conversation with them. He's like, well, why don't we just give you uh 50,000 square feet is what they're looking for. So we'll give you guys 50,000 square feet for the same price per square foot that we bought the building for. Um and so we ended up condoing it off. And so of that two and a half million dollar purchase price, we were able to recoup half of that from condoing it and essentially giving it to the church to build out their space on the first floor, and then they're also running a coffee shop. Um and it'll turn into additional like breakfast and lunch items and stuff like that as well. But they're running the coffee shop out of the building um on the first floor as well. So wow, dude, that is awesome.

SPEAKER_01 38:38

So what what do you think? So you got about you got what about 1.3 ish million back, was it?

SPEAKER_00 38:45

Yeah, uh it was a little bit less than that. I think it ended up just being under a million dollars. Okay. Yeah, so reduced our obviously holding cost on that property.

SPEAKER_01 38:55

What do you think now, Mixon, with what it is? So let's just say you're let's say you're all into this thing for two million bucks or whatever it is, just rough numbers here. What do you think the value on this thing's gonna be once you're fully leased up there?

SPEAKER_00 39:08

Yeah, it should be right around that probably 10 to 12 million number for the rest of our condo portion. Yeah, when we so when we bought it appraised. Yeah, so we so we offered the two and a half, which was accepted, and then our appraisal was at, I think, nine and a half million, as is. So um, yeah, it's there's quite a bit of spread there.

SPEAKER_01 39:30

But wow. This is why you do commercial. The numbers are so much bigger, dude. Unbelievable. So you could refinance that sucker even with at 60% LTB, and you're pulling out four million dollars tax-free.

Using Equity To Buy Without Cash

SPEAKER_00 39:46

Right, yeah. And we use we so yeah, we did some of that. We've used that to do some build-outs and stuff in the building, and but you're using the equity to pay, pay for it, and then get it back in cash flow, right? But yeah, the tough part, um, so deals like that, you were buying it vacant, and you have to be able to support the holding costs on it, because we're we were eating probably forty thousand dollars a month, um, just holding it and trying to get people into the building for sure. And uh, so yeah, slowly but surely we've been able to reduce that. We're I think we're positive cash flow now with our last couple leases signed. Dang, dude, that is so cool.

SPEAKER_01 40:22

If I had my little bell over here, I would be ringing that bell for that deal. That's amazing, man.

SPEAKER_00 40:27

Yeah, but it's it's one of those deals. It's partly my favorite because of how we negotiated it, but it's just one that we learned a ton on because it's it's a building. We bought a couple things that are that size. Um we did the redevelopment of the office building in Nina to 55 plus. So that one is about 150,000 square feet as well. But okay. Um, yeah, it's just one of those buildings where you just learn a lot about it's a lot different than a 10, 15, 20,000 square foot retail building where you have you know multiple shops in it. Like this is this is a whole nother game, just building and and how to work with it. And so wow, dude, that's incredible though.

SPEAKER_01 41:06

I mean, okay, there's a there's a lot of lessons in that in that deal right there, Mason. But audience, did you hear this? So you're their number they just threw out there. Could you imagine the balls it takes to go, you oh, you want 17 mil? How about two? And then they don't they don't say no. I mean, that's amazing. Like you don't know. I I know so one of the guys in uh in the mastermind group that I'm in, he always shares the story of somebody who bought I don't remember what it was, it was some building, massive building in either Detroit or New York or something like that. They had it listed for like 200 million and he offered him something like 10 million for it or something, and he ended up getting it. Yeah, and it's similar, similar numbers there in a sense, right? With the spread. You just don't know unless you offer, right?

SPEAKER_00 41:50

Yeah, yeah. And this one specifically, like we knew the REIT. We're familiar with the REIT, and we we knew that they don't like to hold assets and try to redevelop them or try to release some. They'd rather just dump it and move on. And so that played a little bit of a role in it. But yeah, at the end of the day, like you you have your buy box, right? You stick to what you know, stick to what you do, and it's just a numbers game from there. Like for sure. We always try to lead with, you know, we're not trying to offend you with a low offer. This is just what meets our criteria. Here it is, take it, leave it or counter it, and yeah, good things happen.

SPEAKER_01 42:25

So that's incredible, dude. So, what do you think, you know, all this build-out and stuff like that, Mason? Because I have no idea what build out on commercial stuff is. What do you think the overall cost for you guys to to do the build-outs for all the tenants? And then with the tenants that you're leasing to, if you're building out, like so for Keller Williams, I know it's kind of different because it's still Caleb, but if you are you charging that person the build out or are you just baking that into a higher lease for the build-out, or how do you guys typically structure that?

SPEAKER_00 42:53

Each one's a little different. So we'll uh we typically try to figure out what payment tenants want to be at. Okay. And then we structure it around that. So if they want to have a little bit lower payment and they want this expensive build out, well, then they're either gonna have to cover it or bring some cash down to to pay for some of it so we're not out of pocket for the whole thing and getting a low rent payment. Okay. Um Keller Williams is a little bit different since we owns it, but uh yeah, so like we we covered are covering pretty much their entire build out. Um, and then it just gets baked into the lease rate. So we uh just run an analysis on on the cost to put into it and then what we need to see for our lease rate to kick back out to us. Cool. So each site's a little bit different though. Some are more expensive and some are significantly less. So okay.

SPEAKER_01 43:43

Wow. Well, man, this is this is awesome stuff, dude. Uh, my mind is blown. I hope everybody out there listening, their mind is blown, and the wheels are probably turning for a lot of people like they are for me right now. I gotta come sit with you guys and and just be an intern for a while over at Park Place and learn this commercial game a little bit.

SPEAKER_00 44:00

For sure.

Best Flip: Hudson Office Quick Exit

SPEAKER_01 44:02

Well, awesome, dude. One last question we always ask everybody. It's kind of a fun question why we ask this. We have people out of Wisconsin that are thinking about investing in Wisconsin. Do you have a favorite Wisconsin tradition or place that you like to visit, Mason? Oh, geez.

SPEAKER_00 44:16

Yeah. Um the tough part about being up here, I've so I'm originally from Iowa. So I grew up in Iowa, so I'm not originally from Wisconsin. And uh I think the tough part now being from northeast Wisconsin is that you get so used to Lambeau Field, you get so used to you know, Camp Randall and and uh you know what was Miller Park, and so forth. For me growing up, those were my favorite traditions because I wasn't up here. Sure. And you come to spring training for football and baseball and go to the tailgate at Miller Park and stuff. And so growing up, I would say those are my favorite things to do. Nice. But now that we're up here, or that I'm up here uh and we have our family, I would say it's probably just getting up north, going out on the lake um with the kids, and joining the boats, and we're blessed with my wife's family and having a lake house up there so we can spend a lot of time up there. And yeah, I think the other thing too, supper clubs. Like we some in Iowa, but never really grew up with it. Yeah. As we get a little bit older, just enjoy supper clubs and passions. So yeah, I would say those are probably that's probably it.

SPEAKER_01 45:27

They age well. The older you get and the grainer your hair gets, the more you find your home at supper clubs, I think. Yeah. It's just the thing. Yeah, for sure. That's awesome, dude. Well, dude, this has been great. If anybody wants to reach out to you, Mason, maybe they got a deal, a commercial deal that they want to partner with you on or send your way to buy or whatever, or they just want to you know chat with you. You know, what's the best way for somebody to get in contact with you, man?

SPEAKER_00 45:48

Yeah, I would say email's probably the best. Um I can give it to you or if you want to put the video. I guess I'm not sure what's going on. Yeah, you can throw it out there and we'll add it to the show notes and stuff. Okay. Yeah, so it's uh mason at parkplace-holdings.com. Perfect.

SPEAKER_01 46:04

Awesome, dude. Uh this has been great, dude. I appreciate you taking some time out of here. I mean, we're you're literally profit per hour. You're you're a very expensive man to get on here. What we're taking you away from, dude. I really do appreciate it. For those of you guys listening to this, if you got some value out of this, please share this episode. It helps us grow the audience, helps us grow and get awesome people like Mason on the podcast. And um, anybody out there that's looking for an opportunity in real estate, if they don't want to go talk to Mason about what he's doing, we are hiring right now. So we are hiring an inside salesperson, and we have two openings for somebody in Madison to run our acquisitions as we expand to Madison. So if you are anybody you know out there is interested in uh getting into the acquisition side of things and they want to and they're in the Madison area or want to be in the Madison area, please reach out to me directly, Corey at ibywi.com, or you can go on Wisconsin Discount Properties.com and just put some information on the contact page. And uh, we'd love to have a chat with them and see if they'd be a great fit to join this team. Um with that, Mason, any final words for the audience, brother?

SPEAKER_00 47:11

No, I appreciate the time. And biggest thing I think I said uh is just gotta get going. Got to get started somewhere. And first heel is always the hardest. Yeah, 100%.

SPEAKER_01 47:20

It doesn't have to be a 150,000 square foot make it office building, folks. Okay. You can start small, work your way up there. All right. Don't don't get the big, don't get derailed if you're having success right now either. Okay. This is not one of those. But no, this has been great, man. I appreciate you being on. Thanks to all you guys for listening, and we'll see you on the next episode.