863: Commercial Real Estate: The “Buy Box” for Buying BIG Properties w/Kim Hopkins

BiggerPockets Real Estate Podcast

BiggerPockets

Investing, Education, Business

4.8 • 16.6K Ratings

🗓️ 27 December 2023

⏱️ 41 minutes

🔗️ Recording | iTunes | RSS

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Summary

For the past year, commercial real estate has been the disappointing big brother of rental properties. As housing prices went up, commercial real estate prices went down. When primary mortgage rates were high, commercial mortgage rates were even higher. With record-setting vacancy rates in areas like office and less reliance on retail, many investors thought that commercial real estate was a dying asset class. But they weren’t entirely correct. Investors like Kim Hopkins had thriving commercial real estate success, EVEN during lockdowns and the pandemic. Kim’s secret sauce to her high cash-flow commercial real estate portfolio wasn’t in getting lucky—it was all in her “buy box.” Kim ONLY buys properties that can’t get shut down, in markets where they’ll thrive, with tons of customers nearby. And today, she’s sharing her exact formula with us! But that’s not all. Kim is currently debating doing one more deal before the year is up. This property looked like a home run on paper, but as she’s dug deep into it, the property may not be worth the price. From plumbing issues to overinflated income numbers, Kim uses David and Rob as coaches to help her decide whether this deal is worth doing. In This Episode We Cover: Kim’s commercial real estate investing “buy box” she uses to purchase profitable properties Cap rates explained and why you MUST get this right when buying big properties The inflated “pro forma” numbers brokers will try to convince you of (don’t follow these!) The types of commercial properties that are lockdown-resistant and always stay open The significant risks for commercial real estate in 2024 and two businesses you should NEVER rent to A live deal deep dive with a current deal Kim is debating on buying And So Much More! Links from the Show Find an Agent Find a Lender BiggerPockets Youtube Channel BiggerPockets Forums BiggerPockets Pro Membership BiggerPockets Bookstore BiggerPockets Bootcamps BiggerPockets Podcast BiggerPockets Merch Listen to All Your Favorite BiggerPockets Podcasts in One Place Learn About Real Estate, The Housing Market, and Money Management with The BiggerPockets Podcasts Get More Deals Done with The BiggerPockets Investing Tools Find a BiggerPockets Real Estate Meetup in Your Area Expand Your Investing Knowledge With the BiggerPockets Books Be a Guest on the BiggerPockets Podcast Ask David Your Question David's BiggerPockets Profile David's Instagram Rob's BiggerPockets Profile Rob's Instagram Rob's TikTok Rob's Twitter Rob's YouTube How to Get Into Commercial Real Estate Investing (For Beginners) Pro Forma In Real Estate: What Is It? How To Calculate Cap Rate For Investment Properties Connect with Kim: Kim's BiggerPockets Profile Kim's Email Kim's Instagram Kim's LinkedIn Kim's Website Click here to listen to the full episode: https://www.biggerpockets.com/blog/real-estate-863 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email advertise@biggerpockets.com. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	This is the Bigger Pocket's Podcast.
0:01.8	What's going on everyone?
0:02.8	This is David Green, your host of the BiggerPockets for All Estate Podcast.
0:05.6	Here, as always with my co-host and good friend, Rob Abbasolo.
0:09.4	Rob, how are you doing today?
0:10.6	Very good, my friend, very good. My wife gets back from Paris today. Very good, my friend, very good.
0:13.2	My wife gets back from Paris today.
0:15.0	I've been single-dadding it up, watching both of my kids for the last five days, so I am excited
0:19.6	to sleep again.
0:21.6	I'm very excited. I can imagine and thank you for joining me on today's
0:25.6	show with no sleep but tons of information and a good time. That's right yeah we have a
0:30.0	great show planned for everyone here today we're gonna be talking to Kim Hopkins who is a commercial real estate investor.
0:35.0	Q the scary music who is making deals work today in this market.
0:40.0	Yes, that's right, in 2023. Today we're going to be hearing about a deal that Kim is working on,
0:44.6	what types of commercial real estate deals pencil today,
0:47.3	the risks associated with this strategy,
0:49.4	and how not to get yourself into thy pickle.
0:52.6	All that and more.
0:54.1	This is a killer show.
0:55.2	Let's get to Kim.
0:56.2	Kim, welcome to the show.
0:57.5	Hey Rob, hey David, thanks for having me.
	...

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