Commercial Real Estate Investing for Beginners

The basics of investing in commercial real estate from Commercial Real Estate Investing for Dummies author Peter Harris.
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Instructed by Peter Harris Business / Real Estate
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  • Lectures 76
  • Contents Video: 6.5 hours
    Other: 1.5 hours
  • Skill Level Beginner Level
  • Languages English
  • Includes Lifetime access
    30 day money back guarantee!
    Available on iOS and Android
    Certificate of Completion
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About This Course

Published 4/2015 English

Course Description

Commercial real estate is a foundational asset in the portfolio of the majority of world's wealthiest people. But for the average individual investor, owning commercial property can be very intimidating. In this course, you'll discover how you can become a commercial real estate investor from the author of Commercial Real Estate Investing for Dummies Peter Harris. The confusing terminology and complicated transactions will be simplified so that anyone can understand the many different facets of commercial real estate and how the "little guy", the individual investor, can win big. And ultimately, how owning commercial real estate can be your ticket to lasting financial freedom (where your passive income exceeds your monthly expenses).

You'll discover:

  • How and why anyone can become a commercial real estate investor.
  • The different types of asset classes and which ones are best for individual investors (and which ones NOT to compete with the Big Boys on).
  • How to evaluate a property quickly and easily so that you know when to hold them and when to fold them.
  • The many pitfalls that investors in the past have fallen into and how you can avoid them.
  • Secrets to successfully building generational wealth.
  • Tips for specific asset classes (apartments, self storage facilities, mobile home parks, shopping centers and office buildings)
  • And MUCH, much more

This course was designed for the beginner who either has interest in getting into commercial real estate investment or owns a property or two. As the Education Director of Commercial Property Advisors, Peter Harris shares wisdom that will save you several years in learning lessons the hard way.

What are the requirements?

  • Open mind to the possibility that you could be a commercial real estate investor

What am I going to get from this course?

  • What it takes for anyone to own their first commercial real estate investment property.
  • The different asset classes and which ones individual investors target and why.
  • How to evaluate any deal quickly and easily just like the pros.
  • Major pitfalls to avoid when investing in commercial real estate
  • Tips for Specific types of properties including Apartments, Self Storage, Mobile Home Parks, Shopping Centers and Office Buildings.
  • Secrets to building generational wealth
  • MUCH, much more!

What is the target audience?

  • Those interested or curious in becoming a commercial real estate investor at some point in their life.

What you get with this course?

Not for you? No problem.
30 day money back guarantee.

Forever yours.
Lifetime access.

Learn on the go.
Desktop, iOS and Android.

Get rewarded.
Certificate of completion.

Curriculum

Section 1: Getting Started
FREE Copy of Commercial Real Estate for Beginners Book
92 pages
04:42

Introduction to Commercial Real Estate Investing for Beginners. You'll discover:

What This Course Is:

  • Designed for Beginners
  • How Commercial Real Estate Works
  • Commercial Real Estate Asset Classes ideal for Individual Investors
  • How to Analyze Deals
  • Commercial Real Estate Financing

What This Course is Not

  • Get Rich Quick Training
  • Anything to do with A Class Properties
  • Watered Down Version of the Real Thing (You're going to hear the good, the bad and the ugly)
07:33

Discover how Peter Harris got to where he is today; from his engineering job days to beginning his career in commercial real estate investing and eventually becoming the leading authority on Commercial Real Estate Investing.

10:46

Getting started with Commercial Real Estate involves Why?, What?, How? and Where? You'll discover that at a very minimum, to participate in Commercial Real Estate, you will need:

  • Education on What to Do
  • Computer
  • Cell Phone
  • Calculator
  • Time
12:15

This training explores:

  • What is Commercial Real Estate
  • Why Consider Commercial Real Estate
  • How Do You Evaluate?

From the author of the book Commercial Real Estate Investing for Dummies.

17:47

You'll discover the 5 best commercial real estate types for individual investors, including:

  • Apartments
  • Self Storage Buildings
  • Shopping Centers
  • Office Buildings
  • Mobile Home Parks

In addition, you'll find out

  • Why invest in these property types
  • The sweet spot within each type
  • The pros and cons of each


15:33

In a short and concise training, you'll find out the 5 pieces of data that you must know on each deal in order to quickly and easily evaluate if it is a good deal, including:

  • Income and Expenses
  • New Operating Income (NOI)
  • Cash Flow
  • Cash-on-Cash Return
  • Capitalization Rate (CAP Rate)

And you'll discover some rules of thumb for each.

04:49

Discover why and how to use a Letter of Intent when making an offer on a commercial property, as well:

  • Definition of a Letter of Intent (LOI)
  • 3 Main Purposes for Using an LOI
  • 3 Advantages of an LOI

Plus, you can download a sample Letter of Intent Word document in the resources section of this Lecture.

09:28

Discover the power of the Master Lease Agreement for Commercial Real Estate. You'll find out:

What the Seller Gets:

  • Easy Sale
  • Lease Payments
  • Freedom
  • Rescued

What the Buyer Gets

  • Purchase without...
  • Less Risk
  • Cash Flow
  • Options
  • All the Profits

Once you complete this training, it will be crystal clear as to why smart and creative individual investors use this technique to control more deals with less of the risks and hassles of a normal purchase.

12:06

In the second half of the Master Lease Agreement training, you'll discover what type of seller/property is ideal for this technique:

  • Tired and Burnt Out
  • Lives Out of State
  • Sick/Personal Circumstances
  • Avoid Capital Gains Tax
  • Large Pre-Pay Penalty on Loan
  • Property Management Issues
18:56

Discover an overview of the different ways that commercial real estate deals are funded, including:

  • Conventional Bank Loans
  • Owner Financing
  • Master Lease Agreements
  • Hard Money Lenders
  • Real Estate Crowd Funding
  • Private Funding


Section 2: Investing in Apartments
00:43

You'll hear an introduction to this Section involving how to invest in Apartment Buildings, a great place for beginners to get started with commercial real estate investment.

03:21

You'll discover why starting off in Apartments is good for beginner commercial investors.

  • Demand is High
  • Availability is Plentiful
  • Easy to Understand
  • Banks Love to Lend on Apartments
06:38

Learn the 7 main things to look out for when investing in apartments, including:

  • Have a Goal
  • Area/Location
  • The Property
  • Numbers
  • Management Strategy
  • Exit Strategy
  • Ask Tough Questions


05:32

You're about to find out the 3 major areas that beginners go wrong with Apartments:

  1. They believe the property financials in brochures
  2. They underestimate property expenses
  3. Property Management Oversight
04:45

Here's a step by step complete breakdown of Peter Harris' first ever apartment deal, including all the numbers in great detail.

06:51

Here's your action plan on getting started with Apartment Investing

  1. Get Educated
  2. Find a Friendly Broker Who Sells Apartments
  3. Start Visiting Apartments
  4. Get Your Financing in Order
  5. Create Relationship with Property Manager
  6. Get Your Mindset Right
  7. Don't Give Up
Section 3: How to Buy Your First Multi Family Apartment Building
01:11

Introduction to this Section on step by step, how to buy your first multi family apartment building.

04:39

You'll discover both the personal and investment benefits of investing in small multi family apartments.

Personal Benefits

  • You Can Wrap Your Mind Around It
  • Less Equity
  • Creative Financing
  • Single Investor
  • Small Property

Investment Benefits

  • Less Competition
  • Less Sophisticated Owners
  • No Corporate Ownership Approval
  • Higher Cash on Cash, IRR
  • Easier to Wholesale


10:29

You'll discover how to find good multi family apartment deals.

Real Estate Agents

  • Defining what you are looking for
  • LoopNet.com
  • Make the Call
  • Thank/Exchange/Follow Up
  • Your Goal

Advantages of Direct Mail

  • No real estate agents
  • Off market deal perception
  • Simpler to Wholesale

3 Keys to Direct Mail

  • Target Absentee / Out of State Owners
  • Use Fresh List from Reliable Source
  • Send multiple letters to each contact record
05:00

You'll discover why you should start your multi family investing with 5 units as opposed to 4 units.

07:17

Here are the 5 ways to finance your first deal.

(1) Conventional

  • Local Banks
  • Loan Brokers

(2) Creative

  • Seller Finance
  • Seller Carry
  • Master Lease
  • Wholesale


Section 4: Apartment Loans 101
Apartment Loans 101
01:22
2 Ways Apartment Loans differ from Residential Mortgages
02:37
How to Qualify for an Apartment Loan
05:10
What Apartment Lenders Like and Dislike
04:29
10 Step Apartment Loan Process
05:56
Apartment Loans Available Today
06:27
Section 5: Investing in Self Storage Properties
01:11

This is an introduction to this section on Self Storage Investing for Beginners.

05:08

Discover 7 reasons why some invest in Self Storage Facilities

  • 1 out of 10 people in the United States use Self Storage
  • 50,000 Self Storage Facilities in the United States
  • It is a $220B Industry
  • 80% are Owned by Mom and Pop Businesses
  • No Toilets, No Trash, No Tenants
  • SFR vs Self Storage
03:42

Discover the 3 main ways to find the best Self Storage deals:

(1) Internet

  • LoopNet.com
  • CoStar.com
  • SelfStorages.com
  • BizBuySell.com
  • Argus-SelfStorage.com
  • SelfStorageBrokersofAmerica.com

(2) Broker Community

(3) Direct Mail

04:43

You'll discover the 3 main types of Self Storage facilities as well as the 2 main types of deals.

3 Main Types of Facilities

  • Class A: Year Built 2000 - Present (Prime Retail Location)
  • Class B: Year Built 1980 - 1999 (Mom and Pop)
  • Class C: Year Built 1960 - 1979 (Caution)

2 Main Types of Deals

  • Turnkey (stable)
  • Turnaround (distressed)
03:24

Discover the 2 biggest myths of Self Storage Investing

  1. It's a hands-off, passive income business
  2. It's a quick turnaround business
05:18

Discover exactly how the funding works with Self Storage deals

3 Basics

  • Income/Expense
  • Condition/Location
  • You/Partners

Sources

  • Local Banks
  • Credit Unions
  • SBA Loans
  • Seller Financing
  • Master Lease
06:12

Here are the 7 things to look for in a Self Storage property you are considering purchasing:

  1. Size
  2. Unit Mix
  3. Location: 1-3-5 mile radius, area growing or shrinking, path of progress, competition
  4. Traffic Count
  5. Signage & Visibility
  6. Management
  7. Drainage


09:05

You'll watch a detailed analysis of a real world Self Storage deal complete with all the important numbers.

Section 6: Investing in Shopping Centers
00:58

Introduction to this Section on Investing in Shopping Centers for Beginners.

03:19

You'll discover the 2 configurations of Shopping Centers, the 8 different Types and the key term of shopping center investing.

2 Configurations of Shopping Centers

  • Mall
  • Strip Center

8 Types of Shopping Centers

  • Neighborhood Center
  • Community Center
  • Regional Center
  • Sub Regional Center
  • Fashion/Specialty Center
  • Power Center
  • Theme Center
  • Outlet Center

Key Term: Anchor Store

05:43

Here are the 4 things you must know about investing in Shopping Centers:

(1) Grocery Anchored Will Perform Better

  • Attracts visitors 2-3 times per week
  • Non-cyclical business
  • Less Sales leakage from Internet

(2) Buy Centers with multiple stores/tenants

(3) Leases can be more valuable that property itself

(4) Size does not equate to risk

05:02

You'll learn about the 3 most common leases in shopping center deals as well as the definition of expenses for these types of commercial real estate:

  1. Gross Lease
  2. Modified Gross Lease
  3. Triple Net Lease

Expenses

  • Maintenance
  • Insurance
  • Taxes
05:40

Discover why many investors love triple net leases and who they are ideal for.

  • New/Newly Built
  • Strong Tenants
  • No Management Responsibility
  • Stable Cash Flow
  • Long Term Lease
  • Low Turnover
  • Attractive Financing
  • Corporate Rent Guarantee

NNN are Ideal For:

  • Retired, Hands Off
  • Long Term Income
  • OK with Your Cash Tied Up
  • Protection Against Inflation
04:53

Here are 7 foundational investment guidelines for shopping center investor beginners:

  1. Stabilized, Street Appeal, Strong Anchor
  2. Demographics: Metro, Strong Income, Population Growth
  3. Occupancy: At least 80%
  4. Buy Below Replacement Cost
  5. Lease Terms: 5 year or more
  6. Diverse Mix of Tenants
  7. Leverage: 50-65% Loan to Value
Section 7: Investing in Mobile Home Parks
01:41

Introduction to Mobile Home Park Investing for Beginners

03:42

Discover the 2 Types of Mobile Home Parks and the 4 Keys to Mobile Home Park Demand.

2 Types of Mobile Home Parks

  • You Own the Land, Lease the Lots and the Tenants Own the Mobile Homes
  • You Own the Land and the Mobile Homes and Lease the Lots and the Homes

5 Keys to Mobile Home Park Demand

  • 8.6 Million Mobile Homes in the United States
  • 50,000 Mobile Home Parks
  • 60 Million People Earn $20,000 per Year
  • Average Apartment Rent in United States: $1,000
  • 8% of the United States Population live in Mobile Home Parks
06:38

You're going to discover 4 compelling reasons why you should invest in Mobile Home Parks and the Top 3 Misconceptions of owning Mobile Home Parks.

4 Reasons Why Invest in Mobile Home Parks

  • Growing demand for affordable housing
  • Stable/Predictable
  • Limited Competition for New Parks
  • Potentially Higher Returns

Top 3 Misconceptions

  • Crazy Lazy People
  • Mobile Homes Can Pull Out Anytime
  • You Can't Get Loans on Mobile Home Parks



09:18

Learn 5 important tips on what to look for in a Mobile Home Park as well as 3 Big No-Nos on what to avoid.

5 Tips on What to Look Out For

  • Areas with Increasing Population
  • Stay Away from High Star
  • Seek Out Mom and Pop Owned Parks
  • Minimum CAP Rate of 10%
  • Easy Rent Increase and Cost Reduction Option Opportunities

3 Big No-Nos

  • Hurricane Zones
  • Park-Owned Homes
  • Operating Permit Status
05:12

Here's how and where to find good Mobile Home Park deals:

  • LoopNet.com
  • CIMLS.com
  • MobileHomeParkStore.com
  • 1031CommercialProperties.com
  • Direct Mail

TIP: 20/30/50 Rule


05:23

Discover 3 most common ways to finance Mobile Home Parks:

  • Bank financing
  • Seller financing
  • Seller financing with Note Assumption
Section 8: Investing in Office Buildings
01:49

Introduction to investing in Office Buildings

03:46

Discover 4 compelling reasons why you may want to invest in Office Buildings

  • Long Term Income
  • Triple Net Leases (NNN)
  • Depreciation Tax Shelter
  • Strategic Location
02:23

Discover the one big difference between office buildings and residential.

The value of Office Buildings are determined based on Income which can be improved by Tenant selection, Leases, Reduced Expenses, etc.

The value of Residential Real Estate are determined based on comparable sales.

06:12

Discover 3 very important Office Building basics 20% of all Commercial Real Estate in the United States are Office Buildings but it is the most volatile property type of all commercial properties.

(1) Economy

  • White Collar Job Growth: To get job data, go to the United States Bureau of Labor Statistics
  • Economic Growth: to get local economic data, go to the Local Chamber of Commerce Business Development Department

(2) Supply and Demand

  • Vacancy Rate for the Area
  • Absorption Rate for the Area
  • Local Market Supply

(3) Real Estate Cycle

  • Office cycle mirrors the economic cycle but lags by 4-5 months
05:14

Discover the difference types of office buildings

3 Main Different Types

  • High-Rise: Skyscrapers
  • Mid-Rise: 3- 24 floors
  • Low-Rise: 1 - 3 Floors

Types of Tenants/Properties

  • Government
  • Medical
  • Business Park
  • Research and Development
  • Office Condo

Office Building Classes

  • A Class: Trophy, High Rents (Not for us individual investors)
  • B Class: Older, Good Quality Tenants (Ideal for individual investors like us)
  • C Class: Oldest, Least Desirable (Not for Beginners, Ideal for Value Add Investors)
04:28

Discover 10 key Office Building terms that you must understand prior to Investing

  1. Gross Area
  2. Rentable Area / Gross Leasable Area (GLA)
  3. Price Per Square Foot
  4. Gross Rent
  5. Lease Type (Gross Lease, Modified Gross Lease, Triple Net Lease)
  6. Reimbursments
  7. Common Area Maintenance (CAM) Charge: Repairs, Hallways, Cleanings, etc,
  8. Tenant Improvements (TI): Allowance landlord gives the Tenant
  9. Operating Expenses: Insurance, Taxes, Repairs, Roof, etc.
  10. Capitalization (CAP) Rate: Net Operating Income / Sales Price


03:20

Discover the basics of Office Building leases, the lifeblood of this property type.

  • Gross Lease: Benefits Tenant the most.
  • Triple Net Lease (NNN): Benefits Landlord the most
  • Modified Gross Lease: Somewhere in between Gross Lease and NNN

2 Quick Tips

  • Hire a professional when negotiating a lease
  • Everything in a lease is negotiable
03:26

Learn about things to watch out for and possible pitfalls of investing in office buildings.

  • Rental rates go up and down significantly with the economy.
  • Tenants with the Largest Square Footage
  • Expiring Leases
  • Obsolescence
03:34

Discover possibly the most important thing when choosing a tenant...credit worthiness.


Business Credit Check

  • DnB.com
  • StandardandPoor.com
03:22

Discover the top 3 trends that will affect the future of office buildings.

  1. Workplace Density: Today companies allot 185 sq ft per office worker, 10 years ago, it was 250 sq ft per office worker.
  2. Untethering of Office Workers: 30-40% of dedicated workspace is vacant in a given day.
  3. Telecommuting is OUT and Colloboration is IN: Yahoo! nearly stopped all telecommuting and wanted everyone not only in the office but in rooms together to give a start up small company feel.


Section 9: Property Management
01:13

Introduction to what you will learn in this section about finding and hiring property managers

02:16

Discover the main goals of a property manager so that you can better understand what you are looking for and how to find the best ones.

02:48

Learn the 3 biggest advantages of having the RIGHT property manager managing your commercial properties.

02:32

Find out the single most important thing to look for when hiring a property manager.

03:15

Discover the 3 best ways to find a terrific property manager

Initial Property Manager Interview Questions
05:59
Top 3 Red Flags When Evaluating a Property Manager
05:59
3 Tips on Managing Your Property Manager
03:31
Action Steps for Finding and Hiring a Property Manager
02:10
Section 10: Avoiding Bad Commercial Real Estate Deals
Avoiding Bad Commercial Real Estate Deals Introduction
01:39
Part 2
05:13
Part 3
04:30
Part 4
05:45
Part 5
04:11
Part 6
03:29
Section 11: Conclusion
10:36

Although one great commercial real estate deal can set you free financially, it also only takes one really bad deal to ruin you financially. Discover the true story of a beginner investor who got into a terrible deal and how it could potentially cost him his life savings.

01:15

You'll discover a simple yet profound and powerful lesson on what it takes to be successful in commercial real estate investing.

02:19

Peter Harris' Protege Program Application: http://www.commercialpropertyadvisors.com/protege-program

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Instructor Biography

Peter Harris, Commercial Real Estate Investing Coach and Mentor

Peter Harris is the author of the best selling book "Commercial Real Estate Investing for Dummies", co-author with Donald Trump on the audio course "Three Master Secrets of Real Estate Success", the Commercial Property Advisors Education Director and is considered the leading expert in teaching others how to invest in commercial real estate.

His passion for mentoring beginners on commercial real estate investing comes from the tremendous impact it made on his life. Peter had a “safe and secure” job as an engineer, making a good living but came to realize that his employer wasn’t focused on his long term financial future and decided to take matters into his own hands. With the help of a mentor, he dove into commercial real estate and after acquiring his first apartment building, he discovered that just one big deal could bring in more money per month than his full time job. Soon after doing that deal, he was able to quit his day job and live a life of true financial freedom. Today, he spends his time building up his portfolio of commercial properties as well as teaching and mentoring others on how to leave the rat race and live the life of their dreams from commercial real estate.


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