JF3295: Jorge Abreu - Breaking Ground: Unveiling the Secrets of Lucrative Commercial Real Estate Development

The Best Ever CRE Show

Best Ever CRE

Realestatepodcast, Entrepreneurship, Business, Realestate, Investing, Realestateinvesting, Realestateinvestingpodcast

4.8 • 983 Ratings

🗓️ 12 September 2023

⏱️ 26 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Meet Jorge Abreu, a real estate visionary with over 17 years of experience. Buckle up as we explore the thrilling world of commercial real estate development, uncovering its unique challenges, and discovering the immense rewards it holds. From city hall showdowns to construction conundrums, Jorge spills the beans on what it takes to succeed in this high-risk, high-reward arena. So, are you ready to dig deep into the secrets of ground-up development?

Key Takeaways:

Risk and Reward in Development: Jorge emphasizes the increased risk associated with commercial real estate development, from the entitlement stage to construction. However, with the right approach and a low basis, the potential rewards can be substantial. A lower basis ensures more room for profit, making the risk worthwhile.
City Approvals and Entitlements: Developing commercial real estate involves navigating complex city approval processes. Jorge discusses the importance of securing approvals from city officials, zoning, and city councils. These stages can be time-consuming and challenging, requiring patience and expertise.
Comparing Development vs. Value-Add: Jorge sheds light on the differences in returns between development and value-add projects. While both target a 15-16% IRR, ground-up development projects generally offer higher returns on equity multiples. Understanding these variations is crucial for investors when choosing their investment strategy.

Jorge Abreu | Real Estate Background

Elevate Commercial Investment Group
Portfolio:
- Multifamily properties in TX, OK, SC, SD, FL
Based in: Dallas, TX
Say hi to him at:
Best Ever Book: Traction by Gino Wickman
Greatest Lesson: Spreading myself too thin early on taught me to focus on growing one thing at a time before moving on.

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Transcript

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1:22.0	You got to rezone it. Obviously you got to go through the zoning.
1:25.0	Before you even go through the zoning, you want to go through the city officials,
1:29.0	get their approval, then the zoning, get their approval, and then get the final approval.
1:35.8	Usually it's about three different departments you gotta go through.
1:38.1	Welcome to the best ever show, the world's longest running daily commercial real
1:42.4	real estate podcast.
1:44.0	Our hosts interview commercial real estate experts every day to get you the best advice ever with none of the fluffy stuff.
1:51.0	Best ever listeners, how you doing?
1:52.0	Welcome to the best real estate investing advice ever. the only talk about the best advice ever we don't get into the fluffy stuff with us today
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