Evaluating Industrial Real Estate & Building South End Charlotte

We trace a three-generation journey from pickup-truck rent routes to corridor branding, adaptive reuse, and value-add wins, then break down a Belmont case study that turned a “low yield” asset into double-digit returns. Along the way, we map risk profiles, zoning strategy, and a practical due diligence playbook.

• Family roots shaping a build-rehab-invest mindset
• South End’s origin story and lessons for path-of-growth
• Risk oblivious vs risk tolerant vs risk averse frameworks
• Belmont 100 North Main underwriting and re-tenanting
• Pricing to future rents instead of legacy income
• Community engagement to smooth re-zonings
• Code, change-of-use, and entitlement trade-offs
• Napkin math, lender terms, and budget checks
• Site walks, environmental tells, and market fit
• Team building across architects, contractors, and banks

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Transcript

Welcome And Show Setup

SPEAKER_01 0:00

Welcome to Commercial Unlocked, the podcast where we break down commercial real estate and unlock how it actually works. I'm Sam Klein, a commercial real estate broker here in the Carolinas. Each episode, we'll talk through deals, markets, and decisions that shape commercial real estate from leasing and development to investing and community growth. You'll hear from business owners, city leaders, developers, and people on the ground doing the work. Because I think commercial real estate isn't just about the buildings, it's about the people. Whether you're a business owner, investor, or just trying to understand how commercial real estate really works, you are in the right place. Now let's get into it. Rob, thank you for joining. Thank you for joining me today. I'm glad you've agreed to be on my podcast. You're someone I've wanted to have on my podcast. And I'm going to start off just talking about a little bit. I'm going to tell the Mecca story from my vantage point, as I've heard multiple times. Your grandfather came to the Charlotte area, started picking up single-family residential homes, collecting rent out of the out of his pickup truck. You and your poor brother were forced to re-roof homes in the summer for probably very little pay. And ultimately that built into something. Your dad stepped back from corporate America, took that over, changed ownership to limit liability, and then your dad sort of like stood on your grandfather's shoulder, so to speak, was really the brainchild behind CRCBR, and um probably most notably helped develop South End. And I've I've heard you talk a lot about, you know, writing letters, knocking on doors, and how you still get calls to this day from that that South End neighborhood. And of course, for those of us that live in the Charlotte area, um, South End could not be cooler. It's it really is the it part of Charlotte. Obviously, your dad is hanging out a lot in Blowing Rock and uh has stepped down a bunch and and you have taken the reins as Mecca's president. I've been working with you since 2015 when I got my license. Haven't uh thought about hanging my license anywhere else. And um so you're here today. Um we are not gonna spend a lot of time talking about brokerage, we're gonna start talking development. Sure. And um I've been connected with you, I wouldn't say at the hip, but on some level through a couple of your projects and really watch them unfold. Um my favorite by far is 100 North Main in Belmont, which you pr bought at some preposterously low cap rate uh based on its income. And I say we um I had a small role in that, but as a group, we were able to kind of re-tenant that and redevelop it during some of the due diligence period and fading into construction. And um I'm quite certain that the value added and the the price that it's worth now are just astronomical. So I wanted to have you on for that reason. Um we don't have to be specific to a project, but um a lot of people I think you know, they have this idea that that purchasing a commercial building is simple. And I want to talk about some of the pitfalls, I want to talk about some of the mistakes that are made. Um so take us through maybe you know some of the opportunities that you've identified and and how you've made sense of that with your years of experience and and broker knowledge and construction knowledge.

From Brokerage To Development

Finding Path Of Growth

SPEAKER_00 3:18

Sure. Well, I'll start by saying that uh I appreciate you think enough of me to have me come on this podcast. Um I uh I have uh uh the highest respect for you and what you've been able to accomplish over the last 10 years, and I've had a front row seat to be able to watch it. For clarity's sake, before we talk about buildings and project specific, I will tell you as far as my story goes, um my grandfather did start acquiring real estate in Charlotte in the 1950s, and he did so out of uh a need. Um Granddad uh left the farm before graduating from high school and um went on the road singing country music, ultimately became a recording artist for Decca Records. And uh after years of trying to get rich and famous, uh he never got rich and famous. And so uh uh and and also having a uh new family, uh wife and children, he realized he's got to find a way to make a living. And uh ultimately ended up back in Charlotte and um uh went into work in the uh textile industry for a while as a machinist, and um um started realizing that maybe his uh uh true path to success was ownership of real estate. And third three generations later, I'm grateful that he did that because I found something in my own life that I'm very passionate about, much like he was. But uh granddad did start buying rental houses and uh vacant lots and uh grew the portfolio over time. And in 1975, my uncle and father convinced him he needed to take these properties out of his personal name and create a company and shield some liability and set it up for future generations, and uh they created Mecca. Mecca is Michael Elizabeth Cheryl Anthony, it's my granddad's four kids' initials. And Mecca also rhymed with DECA, DECA Records, which he was a recording artist for. But uh granddad had uh very limited education and uh humble roots, coming off the farm, working in manufacturing, uh unloading trucks at night at parking shop on Wilkinson Boulevard before going home and doing it all again the next day. But as he saved up money, he realized I could buy a house and I could rent it, and I can buy another house and I can rent it. And uh as time went on, by the uh mid to late 70s, he had over 100 properties and he was single-handedly caring for these properties. And yes, I did have the luxury and the and looking back on it, uh, it was a pivotal moment for me. But at 12, 13 years old, would spend the summers, he wanted me to learn construction. He wanted me to know how to roof houses and frame houses and uh do hardwood floors and electrical and plumbing and all those things. And uh little did I know then that that was the seed that would ultimately plan in me in college to pursue a degree in construction management. And so during the college years, I uh pivoted from art to business to construction management and graduated with a degree in construction management and minors in art and business, and they all served me well. Uh my art degree, I used more than I ever would have thought uh through making choices of design and um everything from colors all the way to the vision of the exterior of a building. But uh in 1980, unexpectedly, uh granddad died um doing what he loved and working. He died at work. And uh so my father, uh, like his siblings, all had jobs. And dad was with corporate America, he was an executive for Night Ritter Publishing Company, and uh he was the sibling who raised his hand and said, Look, I will quit my job and I'll take over the portfolio and manage it for the family. And soon after doing that, he got an office, got an assistant, then hired a broker, and then hired some maintenance people, and then started brokering real estate and started uh managing property for others. And that was really the genesis of the services business. Up until that point, it had been managing the family's portfolio. But that's really where the services business came from. So, yes, granddad did start the genesis of the company by acquiring real estate, investment properties. Dad's the one that started the services business. And as years went by, uh he was about to embark on the uh redevelopment of a 13-acre property sitting on South Boulevard in Charlotte that was a manufacturing facility, and his vision was to rehab that property and convert it to office retail restaurant space. It was near uptown, it was near Dilworth, and he saw the vision. I didn't. He asked me on a Saturday morning to have breakfast uh in 1992, and I did, and uh he took me to the property and said, This is my vision. And I was in the petroleum business. I designed and installed underground petroleum systems for sea stores and understood the environmental side of the business, and this property was contaminated. So, long story short, that was the day he convinced me to come work for the company. And so in January of 1993, I began uh my career as a real estate practitioner. Um I spent decades brokering real estate. Uh ultimately we split the commercial uh brokerage arm of the company off from the parent company and uh, as you know, affiliated with Cole Well Banker Commercial and had a good 20-year run, which expanded our reach from the Charlotte region to more of a national level. I spent this morning working on a property in Hinckley, Illinois, of all places. Um, but it's been an amazing career. And January 18th of this year, I will conclude my 33rd year with the company, and it's uh been an amazing run. And what I love about it more than anything is uh being able to scratch my creative itch being a frustrated artist and be able to uh see what something could be. Granddad knew how to see what something could be. He bought in the right neighborhoods and the right places in the path of growth. Dad did the same thing, and his uh 30-year run at the company was spent rehabbing uh buying properties, adaptively reusing those properties and rehabbing those properties and creating value. And it was done in part because uh we saw what could be and saw an opportunity to give something back to the community and also make money. And I really liked that. Um uh but the other part of it was is that a necessity. Uh unlike a lot of our big competitors, we're not a family that's uh uh independently wealthy and was able to fund uh new construction and building towers in the downtown urban core. We had to focus on things we could afford. And oftentimes that meant we had to go to neighborhoods that maybe weren't the most popular in town. And so that's how we ended up on South Boulevard, and dad ended up uh creating the South End Development Corporation and branding the South Boulevard Corridor, South End. And it's pretty amazing today to have him back to town to see his vision has come to life in a grander scale than he could have ever ever fathomed. Um but um uh once you once you start down a path, you start realizing, hey, I kind of like this. And so um as South End began to mature, my interest became okay, well, let me go find my own areas of town that are still affordable and go in the areas that are path of growth. And that led us out Wilkinson Boulevard and ultimately to Gaston County, where I lived for six years and saw uh great opportunity in Gaston. And uh that's what got us here. And so that's a little more explanation of why we choose to rehab two million square feet of old mills over 30 years, and that's how we reached a place of buying buildings in areas that weren't that great, but appearances were it could become great. Dad used to have a saying, he said, I I I gave him a hard time one time, I said, Dad, you need to spend more time developing and less time doing community improvement. And he chuckled and said, What are you talking about? And I said, Well, you seem to be greatly concerned about everything around the property and we need more projects. And he uh laughed and he said, Um, we can develop a great property in a bad neighborhood, or we can develop a great property in a neighborhood that's on the way up. And so we have to be involved in the community building as well. So that's that's how we got here.

Risk Profiles And Timing

SPEAKER_01 11:39

Yeah, I mean I it it's incredible to me to work specifically in Gaston County and have people want to pay attention to the part that's already too expensive, and I'll take them to the part that hasn't quite got there yet, and I'll say, look, here's the this is the the next opportunity. And it's like, you know, I got a nose wrinkle and uh, you know, hey, if you if you find a really great deal on the best corner, give me a call. It's like sure, I'll I'll uh I'll add you to the list of however many hundreds of people want that. So it's unique to go out and say, you know, this is developed, you know, this the money that's gonna come in here just does not get the return that we need. So where are we gonna go next? So, you know, what looks good versus what performs? And I think, you know, you've been, you know, you came to Belmont, Belmont has has really exploded, especially since COVID. Sure. And gotten very hard to afford. So what's next? You know, is it is it that Mount Holly? Is it is it Cramerton? Is it you know, we've talked a lot about Lowell, and I know you spent some time there. So um, so talk a little bit about like what looks good versus what actually is gonna perform.

SPEAKER_00 12:42

Well, when you have experience watching growth and patterns of growth and why people make decisions, we uh we used to have a saying that uh there's uh three types of investors. Um there is the uh risk oblivious, who tend to be the first investor into a blighted area of town, but they see the vision and what it could be. Often includes old, cool old buildings, housing stock that was well built back in the 20s, 30s, 40s. And um uh these are creative types that come into an area and they're willing to take risk. They they they risk oblivious. The next group in that comes in behind them are the risk uh tolerant. They uh have seen what some of the risk oblivious were able to do, and they say, well, I could do this too, and they pay a little bit more of a premium, but they don't have quite the risk that first group did that entered into the area. And then the last group is the uh risk averse. They have no interest in taking risk, they want the final product, they want the neighborhood to already be there. Uh, I would say we teeter as a company somewhere between the risk oblivious and the risk tolerant. Um and again, we go into those areas, it's about creating uh value. It's about seeing what could be, taking the diamond and the rough and turning it into something special. And each time that's done, it brings in the next wave of investors who come in. And and uh we've done we've done a pretty good job over the years, over the last 50 years of finding the next pocket of growth. And uh uh and I think that uh uh well I know I'm very fortunate in that we have a whole company of people who seem to follow some of that same mentality and and and so you ask, where's the next path of growth? Um well, I don't know. I could give you my opinions and I could, but if you're not risk oblivious, then it's probably not worth discussing. So we have to size up each of our customers and understand what's your goal, what's your objective? Is your objective just to have a facility to operate your business, or is it to put it somewhere where it's gonna grow around you and you're also going to create uh uh value by being the first one in or the second one in. Um so you know, I think we also because we've walked the walk, we uh have the ability to um talk to our investors and our clients in a way that they get it. They've seen us in action and we're we're practicing what we preach. And uh so that that's it's it's about what the uh client wants.

SPEAKER_01 15:10

Yeah, I I think one of the things I love is when you're starting on a project, a lot of times you'll you'll call me or you'll talk to me and be like, hey, what's missing? you know? And um, you know, to me it's amazing. It's almost like I I use the term a slap in the face. It's like, how many times do I get a call from someone who's looking for small bay flex space that I don't have any of? And so I'm able to, you know, regurgitate that to you, like, hey, I know you're building some bigger pieces, but if you if you cut off some small pieces, I could lease them in. And of course you're you're thinking about investing money and and getting a return on it and and what the delay is. So that's been fun. But let's skip ahead, let's talk about you know, let's let's come from 30,000 feet down to you know, ground level. We hit a building, what are some pitfalls? I mean, roof, HVAC, some of the things that you start to pay attention to first that can really like trip someone up when they're trying to invest in a property.

Belmont Case Study: 100 North Main

SPEAKER_00 16:02

Well, I mean, I think the first question is um w is i uh uh well there there's the analysis of the real estate itself. Is it contaminated? Is the building uh structurally unfit or is it sound building? Um and then if you can get past the first few questions, uh then the question uh comes, uh is there a market for something? I mean, this building could be five different things. What is the what's the highest and best use? What does the market want? What is the market short of? It's supply and demand. And so we then answer those questions. Sometimes we go about it a different way. We already know there's a uh lack of supply for industrial flex space in an area and there's a lot of demand for it. So, all right, well, let's go find the right property and let's deliver that product. You mentioned 100 North Main and Belmont earlier. There was a case where uh it was a uh 16,000 square foot building that was a former textile mill headquarters, and it was filled with one office users, almost uh like a key man type building, and it was uh in in poor repair. It didn't look good, and the rents were a fraction of what we thought we could achieve in rents if we fixed the building up. And so buyers tended to look at that property when it was brought to market as a very low return on investment, but they kept looking at the current income stream and not the future income stream. So at that point it became a mathematical equation. We knew it was in a great location, we knew it was a solid building, but it had pitfalls. It needed a new roof, it needed new HVAC systems, it needed uh cosmetic interior improvements, it needed uh a lot of things, but a lot of it was what we call lipstick and rouge, things that could be done with paint, some rearranging, some walls. But the math and the underwriting we did, we backed into it and said, okay, well, uh the building at this price is generating about a five or six percent return uh to a potential buyer. Um, well, that that's not gonna work. So we began to run math and bring in contractors and architects, and what if we did this? What if we did this? And what if we got rid of the 20 some odd tenants and there pared it down to eight tenants? Um and what kind of rents could we achieve? And so a lot of investors looked at it and walked away because of the low yield on existing income stream. We looked at it and said, this income stream's a third of what it could be. Yeah. So the question then becomes, what's it gonna cost us to buy it? What's it gonna cost us to rehab it? And then uh what kind of rents can we achieve? And so we we took some risk. Uh the rents we needed and wanted to make the kind of yields we wanted was gonna require us to push the market in downtown Belmont to a uh price point that uh nobody had ever paid. And we knew it was such an iconic building and had such great opportunity that um we only needed to find eight people who would agree to pay that rental rate. And uh once we started on construction, uh leasing the building was not that difficult. We realized there were a lot of people that would pay the price to be in that location. And so uh fortunately for us, we uh we did do the rehab, we jockeyed a few tenants around we kept and uh we were able to backfill the rest of the building, and that was about five or six years ago. And so the uh the the real benefit to myself and my investor partner was is that uh we're yielding double digit returns uh on a building that everybody said was way overpriced, and we paid full price.

SPEAKER_01 19:37

Absolutely. No, I remember that well. And I think uh not only did you find the eight people, we had a waiting list by the time we were done. Sure. And I think you probably heard from me and Eric and everyone else in our firm that's like we don't we have a list as long as our arm of people that want to be in Belmont and no place to put 'em. So you did you did a great job of creating that.

SPEAKER_00 19:57

Um it's also about having the nicest building in a great market, um, but not being so nice that you price yourself out of the market. And we are in the position right now where we are beginning to go through the uh uh lease expiration of some of those first generation tenants who came into the building. And my partner said to me over the weekend, said, I'm really nervous about this. We have to find new tenants because some of these are uh relocating or moving to other areas. And uh I said, No, you're looking at this as a liability. I'm looking at it as an opportunity to further increase rents and further enhance our uh yield on our investment.

SPEAKER_01 20:34

It's uh yeah, but the the market has only come up since that point. Uh let's uh let's delve into zoning, which can be a real um spirit breaker. Um talk to me a little bit about um some of the challenges you've encountered. Talk to me about what sometimes change of use can do to a building as a cautionary tale, you know, with traffic studies and various other improvements and challenges.

Market Fit And Releasing Strategy

Zoning, Entitlements, And Code

SPEAKER_00 20:59

Well, each municipality uh lays out the uh rules required to re uh to rezone a property or entitle a property. So we talked about identifying properties that are uh candidates for makeovers. We've uh repositioned them in the marketplace. And sometimes when you you find a great diamond in the rough in a wonderful market, the highest and best use is not consistent with the zoning that's currently on the property. And so you have to go through the process of okay, is this truly what we want to convert the use of this building to? And if so, what is it going to take? And so it starts with architects who understand zoning code, who understand building code. And oftentimes a rezoning of a property or redevelopment of a property will require rezoning. Uh, it'll also require bringing the building up to current code. And so it's really a kind of a double edged sword. I need the entitlements, but when I get the entitlements, now I'm gonna have to improve the building to bring it up to current code for that use. And so it's it's a balancing act. But zoning is uh zoning is a deal breaker for a lot of folks. Um that there are opportunities along the way. I've I've purchased buildings and redeveloped buildings over the years where many tried before me and for one reason or another got disgruntled along the way and dropped it and moved on to something else. And I often like being in that position. I like being the third one in because uh I am not as um concerned about the rezoning process. Um and so um I just went through a rezoning last year, and it took me twice as long to rezone the property as I wanted, and it took a lot of politics, but ultimately we prevailed. Um sometimes uh things worth worth having are worth fighting for, and uh so there's a plan that needs to be put into place, and it doesn't need to be done with somebody uh guiding you or um helping you to rezone a property that doesn't understand the local politics, the uh local uh process. And so surrounding myself with very smart people who understand that, and then going at it from a uh approach of a uh meeting with politicians, meeting with uh surrounding property owners and getting their buy-in. Um people like to feel like they're part of the process as opposed to being subject to it. And so when we consider rezoning a property, we we make it a point to meet with the local politicians, the local planning staff, and adjoining neighbors. Because if we can get in to get to them early and make them feel like they had a say in this process, then it's it's likely to go much more in favor than it is to be denied. But even then, sometimes the communities, especially when you get into a community like Gaston County where growth's happening very rapidly, uh I had a conversation at lunch today. The old timers that are here, they're scared. Their community's changing and they don't necessarily see it positive change, even though the the greater market sees it as positive change, they they it's changing. And so uh alleviating their concerns is huge. But yeah, uh rezoning property is becoming more and more, and municipalities are putting higher restrictions on properties, and and um so it's uh and then there's the cost. Maybe we win the rezoning, but we need to know that we can bring the building up to current building code if we uh are successful in our rezoning. And so it's kind of a balancing act. We need to spend some time with the contractors and architects, and we need to spend some time with the politicians, and these two things need to be going concurrent with each other. So the last thing we want to do is buy uh rezone a building, buy the building, and then find out we can't afford to rehab the building.

SPEAKER_01 24:31

Yeah, I mean I it's maybe it sounds super simple, but I think when it comes to that process, you just kind of have to be tough because you'll get told no or you'll get slowed down. And uh to your point, a lot of people are like, I can't I can't stick with this. Maybe maybe fits that five feet from gold um scenario where you just gotta kind of keep pecking.

SPEAKER_00 24:50

Well, they're a risk adverse buyer-investor. Yeah, so they would rather pay a premium and just walk in and have it all done. Um and again, we teeter somewhere between risk oblivious and risk tolerant. So uh my tolerance for calculated risk is is pretty high. And um, but I always have a plan B strategy. And I tend not to commit to make the ultimate purchase until I have my entitlements in place and I have my budgets vetted.

SPEAKER_01 25:21

Okay, so let's do some like bullet point takeaways. We're thinking of investing, um, you know, we're looking at a property. Talk to me, just start from the beginning, neighborhood, um GC zoning overall concept. What give me give me the lightning round on this?

Community Buy-In And Politics

SPEAKER_00 25:42

Um so uh uh as often happens, brokers like you within our firm bring and plop down on my desk the amazing opportunity that I must consider. And so my first question of the broker is is this what are we gonna do with it if we buy it? Well, we believe highest and best use is this, because supply is low and demand is high. Okay, great. All right, well, let's go down that road. Let's go to the building, let's walk around the building. Uh there are telltale signs that there may be some structural problems with the building or remnant uh environmental concerns that we should have, uh oil stains in the parking lot or tank uh vent pipes sticking out of the back of the parking lot. Uh, you know, we want to vet through the low-hanging fruit. Um, and and then if we decide to move forward, then we start talking about all right, well, let's run a quick uh, I call it napkin math valuation. Uh I did that for somebody yesterday who was trying to sell me a building, and I said it's way overpriced. And he goes, Oh no, there's a great value add play here. And uh I did the math for him in an email, and he said, Well, maybe it's not as much value add as I thought. And I said, No, it's not. Um, so backing into numbers, looking at doing a physical inspection of the building, maybe even going down to planning staff and saying, we're kind of contemplating taking this warehouse building and converting it to retail restaurant. What's your take? Was that something you guys could get your arms around and support? Do you think council would if we went through a rezoning, do you think they would support this? Is your conditional land use plan calling for us to have this type of use in this area of town? Um, I often ride neighborhoods. People don't know how much time I spend in my car riding around windshielding neighborhoods and properties. I look at what are other businesses in the area, what are other buildings being used as in the area? I mean, you may think, oh, I've got this uh potential tenant who is an amazing restaurant. Well, if they get plopped down in the middle of an industrial area who likes to buy cheeseburgers for lunch and they're selling filet mignon for lunch, that's probably not a good So those are little things we do. And and whether we're doing them for ourselves as investors or whether we're doing them for our clients, we do far more of this for our clients than we do for ourselves. And I don't want anybody that listens to your podcast to believe that our needs go ahead of our clients' needs because they don't. Um I would never, ever, none of us would, step in front of a client. Now, if a client says, I don't see it, I say, Do you think I might make a run at it? Would that hurt your feelings? Um But uh no, I our our we're we're a 50, 51-year-old company this year because our clients trust us, they know what we're talking about, and we do what we say we're gonna do. And uh never would I ever uh put uh development opportunity in front of uh a desire of a client.

SPEAKER_01 28:27

I helped uh a couple guys purchase the Piccolo building, um, which we're gonna manage for them, and I was trying to do that kind of napkin math and convince them that this was really the right um opportunity. And one of them had an iPad and I scribbled all over the iPad and um chicken scratch and I said, This is how it's gonna work. And there was kind of like a pause, and he said, Um, I'm gonna save this, and if it works, I'm gonna frame it and we're all gonna laugh. So that yeah, I've done I've done plenty of that. It's actually uh from my perspective when it comes to my job, you know, you have very simple transactions and uh, you know, they're important to do, but sometimes when there that complexity comes in where I really have to think, where we really have to like fall back and consider resources, that's when I have the most fun.

Lightning Round: Due Diligence Playbook

SPEAKER_00 29:12

Well, there's a good that that property that I'm very familiar with, because as you know, our firm manages that property for the owners. And uh um they were over uh they were able to um overcome and see something that I couldn't. I tried to buy that building twice and could never come to terms with the seller. Your client was able to overcome my biggest challenges and was able to successfully navigate the purchase of the property where I failed. And uh there was two easy reasons why is the first one was is they were prepared to occupy uh a portion of the building that I was placing little value on because of the nature of their business. And so where I was, I would have to go find a tenant for that space that I considered to be maybe C minus space, they saw it as a plus because it fit their needs perfectly. But the other challenge they were able to overcome was is the seller wanted to stay behind after closing and occupy the building at a rental and income rate that I couldn't make sense of. But your clients again were able to navigate that and figure out a solution for that. And the building vacated the the the sellerslash tenant of the building vacated last month, which has now freed the path for them to be able to go in there and start their redevelopment process. And so that there's it's it's not um because one investor is smarter than another that they want an opportunity. It's they may have uh a path or a thought of how to get to the end that's different than what another person does, or they may have resources or a use for the building that solves for a problem that, for example, I couldn't solve for. And so uh that pleases me that we get to manage the property, help them redevelop the property, help them lease the property and continue to be involved. Um having ownership is not the only uh thing that is rewarding for us, it's it's uh helping people in communities where we're already invested to see their dreams come true.

SPEAKER_01 31:28

Oh yeah, I'm loving Mecca's thumbprint on that building for sure. So we're gonna close this up with kind of a final thought. If the firm or myself or another agent, another broker has a client that's looking to acquire property, what is the first thing that you're gonna do to kind of get them on track to take a look?

Team, Budgets, And Napkin Math

SPEAKER_00 31:47

Hmm. Well, we just spent 20 minutes talking about the way I look at a property and the decision-making that process that I go through, and I don't think it's much different than that. Um I uh always surround myself with talented professionals. We do what we do, but uh we stay in our lane. Um I need architects, I need contractors, I need other professional help, I need lenders who I can have early conversation with to find out what they're gonna require of me. And so I think that it starts with doing what I said earlier, the napkin math. Does this work? If we buy it for this and we estimate the construction as this, does that pencil? And I would call my bank and I'd say, here's what we're considering. What would the terms look like for a loan? I would get my architect engaged, and instead of going to full-blown building plans, I would have them sketch out how the building might look, much like you did for your Piccolo client on your iPad. Um and then I would have a contractor walk through the building with us, point out areas of concern they have, talk about general construction cost for interior and exterior improvements. Uh, if I had any concerns over the environmental condition of the property or one close by, I would probably call one of my environmental consultants. Um we we have several at the firm we use, and have them take a quick look at it. They have resources to be able to look quickly and say, red flag here, you know. But once I kind of went through all those processes, then it'd start engaging, spending a few dollars with my professional consultants, have them go through the process of doing some preliminary designs, getting some more refined construction cost, and then build a construction budget or a project budget for it. And then now I'm kind of at a number where I feel it's pretty good. It's checks and balances. But the number one thing I would suggest is this we do a really good job internally of going to each other when we have questions. Um, you know more about certain things than I do. Your background's construction as well. So I may pick up the phone and call Sam. I may call another practitioner within our firm and say, you've got more experience in this area, come talk to us about what your thoughts are. So internally work our internal resources, then start looking for some external resources like architect, contractor, lender. Um, but take baby steps. Uh never get emotional. There's no deal that anybody has to have. If this one doesn't pan out, my my my experience over the last 34 years has been when one door closes, another one opens. And sometimes uh rushed emotional decisions tend to lead to bad outcomes.

SPEAKER_01 34:33

Yeah. Well, Rob, I know you're a busy guy. Truly appreciate you taking the time to sit and talk with me today. And um we could probably talk for another two hours about real estate, but it's time to segue out, so thank you very much. Thank you for the opportunity. All right. Thanks for spending your time with us today. I really appreciate you being here. If you found this episode helpful, make sure to like, comment, and subscribe. And don't forget to hit the notification bell so you can unlock all of our content and never miss a beat. We've got a lot more conversations coming your way, and I'm excited to unlock even more of the commercial real estate industry with you in the next episode. We'll see you there.