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Finding Hidden Opportunities in Beaten-Down Commercial Real Estate with Dolf de Roos
• 47 minThe King of Commercial Real Estate joins us to discuss office, hotels, apartments, retail, industrial and warehouse real estate. Many office building values are down 80%+. Is it headed straight to purgatory? According to Moody’s, the national office vacancy rate is 20%. Offices have the double-whammy of higher interest rates and lower demand. Learn how feasible office to residential conversions are. For two years now, momentum has swung from Airbnbs to hotels. More apartment syndications will blow up from forthcoming interest rate resets. Commercial real estate often has higher prices than residential. Learn from our guest, Dolf de Roos, on creative ways to make low down payments. Learn how to vet commercial tenants. We discuss adding carports to residential RE. Rich people are often vilified. They’re called “filthy rich” or “stinking rich”. Resources mentioned: Attend Dolf’s free live training: www.DolfLive.com For access to properties or free help with a GRE Investment Coach, start here: GREmarketplace.com Get mortgage loans for investment property: RidgeLendingGroup.com or call 855-74-RIDGE or e-mail: info@RidgeLendingGroup.com Invest with Freedom Family Investments. You get paid first: Text FAMILY to 66866 For advertising inquiries, visit: GetRichEducation.com/ad Will you please leave a review for the show? I’d be grateful. Search “how to leave an Apple Podcasts review” GRE Free Investment Coaching: GREmarketplace.com/Coach Best Financial Education: GetRichEducation.com Get our wealth-building newsletter free— text ‘GRE’ to 66866 Our YouTube Channel: www.youtube.com/c/GetRichEducation Follow us on Instagram: @getricheducation Complete episode transcript: Automatically Transcribed With Podsqueeze Keith Weinhold 00:00:01 Welcome to GRE! I'm your host, Keith Weinhold. There are many commercial real estate sectors. Large apartments, office, hotel, hospitality, retail, warehouse, industrial. Well, what's thriving? What's been beaten up so bad and is never coming back? And what's in a dip that's ripe for opportunity? Also creative deal structuring if you don't have a lot of money. It's the debut of the King of Commercial real estate here today and get rich education. When you want the best real estate and finance info, the modern internet experience limits your free articles access, and it's replete with paywalls. And you've got pop ups and push notifications and cookies. Disclaimers are at no other time in history has it been more vital to place nice, clean, free content into your hands that actually adds no hype value to your life? See, this is the golden age of quality newsletters, and I write every word of ours myself. It's got a dash of humor and it's to the point to get the letter. It couldn't be more simple. Keith Weinhold 00:01:13 Text gray to 66866. And when you start the free newsletter, you'll also get my one hour fast real estate course completely free. It's called the Don't Quit Your Daydream letter and it wires your mind for wealth. Make sure you read it. Text gray to 66866. Text gray 266866. Corey Coates 00:01:41 You're listening to the show that has created more financial freedom than nearly any show in the world. This is get rich education. Keith Weinhold 00:01:58 What does your read? From Tuscarora, Pennsylvania, to Tuscaloosa, Alabama, and across 188 nations worldwide. I'm Keith Whitehill, and you're listening to get Rich education. Today's guest, the king of commercial real estate, is talented, dynamic, global, articulate, has both a wide range of knowledge and an expansive palette of creative strategies in both commercial and residential, where you can buy with little out of pocket. And he's going to share that with us today. That's coming up here shortly. Now, when we think about residential real estate, of course, that is a really wide world in itself. Keith Weinhold 00:02:38 From condos to single family homes to tiny studio apartments. You could also divide it into short term and mid-term and long term rentals. And then you could also parse it by all of the geographic markets. Well, of course, the commercial real estate world has a ton of segments too, one of which is office, which I want to talk about because it's probably been the most downtrodden and beleaguered since 2020. But there are still some things that are misunderstood within office and even dividing things up that much. Let's take care not to broad brush stroke office real estate itself some smaller segments of office might be in decent shape today. Other office segments are in real trouble. Like we're talking about tall concrete and glass, office towers and a lot of business parks, too. Yeah, business park, sort of a campus like areas, like maybe what the comedy The Office had. He had Dunder Mifflin was in a business park. Steve Carell 00:03:43 I'm just helping you invest in your future, my friend. Oscar Nunez 00:03:46 It sounds like a get rich quick scheme. Steve Carell 00:03:48 Yes. Thank you. You will get rich quick. We all will. Keith Weinhold 00:03:52 yeah. I guess that's what Steve Carell's character. What Michael Scott from The Office says about prudent investing. Let's talk about office real estate and how that intersects with the housing market. And really a lot of this comes down to the office vacancy rate. Moody's tells us that 1 in 5 office spaces in this economy are empty. And that is the highest ever. And a lot of people think that it's going to go higher right now. Dayton, Ohio is the highest in the nation at 28%. These are office vacancy rates. Charleston, West Virginia's 27. Tulsa, Oklahoma 26. And Houston, Dallas and Austin are all in the top ten for the worst office vacancy rates. Now, a lot of city officials, they want to turn that into housing, and they want government funding in order to make that transition happen from office to residential. This is most attractive to cities if you can partially convert a building to have housing on upper floors, and then you just maintain some offices on lower floors and see that mix right there, that makes for a vibrant, lively downtown community, because that way you don't have downtowns that go quiet at 5:00. Keith Weinhold 00:05:10 But a lot of these renovations, they just aren't that feasible. They call them ritzy conversions. That's kind of what this is known as. So office to residential. I mean that means you often got to deal with huge floor plates, overhaul mechanical systems, and you've even got to consider things like the fact that windows don't open in office buildings. And they've often got to for resin conversions. Well, with this prolonged high vacancy in offices. Well, where do these people that would have been in offices spend their time instead? Well, of course at home in their residential real estate. And oftentimes it is a one for one. You have one less person occupying an office for lots of that waking day, and that means one more person occupying their home. Well, that's one reason that people are increasingly willing to spend and pay more for homes because they're spending more time than ever there. And ever since the work from home movement and zoom from home movement, if you will, since that became commonplace for urban workers coming off the pandemic, you soon saw the hashtag auto. Keith Weinhold 00:06:27 The return to office movement that began is where you've got to come into the office 2 to 3 days a week, and then a lot of companies try to ramp it up to 4 to 5 days per week. Some companies even said, yeah, come on in here. You've got to in order to be eligible for promotions. Well, a lot of people don't want to come into the office. We found that out now, especially younger workers. In fact. Did you ever hear of the term coffee bagging? Yes. Some workers are trying to game the system. Coffee bagging. That is the art of returning to the office to a quick hit. Just have a quick hit. You only badge in, get coffee, chat and peace out of there. Well, more people are doing this or they're staying at home than what you're often led to believe. So despite the RTL movement that you hear about the share of employed persons that work their average day from home, last year it rose to 35%, up from 34%, and that's per the BLS. Keith Weinhold 00:07:31 Well, that's a little interesting to know, but it all comes down to that office vacancy rate, which is, like I said, a stubbornly high all time record 20% nationally, and it could go higher. If you're going to invest in office real estate today, I mean, you've really got to have some insider knowledge and invest smart. Donald Trump 00:07:55 Did you use the word smart? so you said you went to Delaware State, but you forgot the name of your college. You didn't go to Delaware State. You graduated either the lowest or almost the lowest in your class. Don't ever use the word smart with me. Don't ever use that word. Oh, give me a break. Because you know what? There's nothing smart about you, Joe. Keith Weinhold 00:08:16 oh, dear. Oh, one of those two men is our current president, and the other could be our next president. Oh, well, love him or hate him, I guess the Trump. Hey, he is the Art of the deal author. And when you think about the Trump name, you should think about seeing those letters on tall office buildings in hotels coming up on the show here in future weeks. Keith Weinhold 00:08:39 We are stacked with great guests an NFL All-Pro, the president of the Mississippi Institute, the return of the tax free wealth author Tom Wheelwright, and also the incomparable financial firepower of Garrett Gunderson. That's all coming up here in future shows. Let's talk to the king of commercial real estate. This week's guest is a former high tech engineer turned real estate mogul and New York Times best selling author of the book Real
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