How to get your commercial real estate investing career started and how to grow your network?
I’m already seeing some properties come back to my inbox with an email subject of “Major price reduction”. The time is coming for people that have been preparing for a while, and it’s important for you to do a few things in preparation for that, if you haven’t already started.
I’m going to give you quite a few ideas on how to get started, you can take one idea or a few ideas, just make sure that you’re not all over the map, trying to do everything at once and with no focus. I’ll start with the very beginning and go all the way to when you have a property under contract.
How to get your commercial real estate investing career started?
There are a lot of ways that you can get started investing in real estate with, or without money. If you don’t have money, it may take some time to purchase your first property, and that’s ok, because you do need to go through the learning process before purchasing that property. Some ways to get started from scratch are:
- Becoming a commercial real estate agent. Here you can either sell properties, or be a commercial leasing agent. When you become a real estate agent and start working for a broker, they should guide you and educate you in the right direction. Plus the fact that you will have other agents to learn from, and ask questions.
- You can start working for a real estate investment firm. I met someone that literally started as a secretary and worked her way up to a partner. There’s no shame in starting from zero, even if you now have a nice, cushy big corporate job. Changing careers is ok, even if you take a pay cut. If you are good, you will always rise up.
To give you an example, a few years ago I had a startup that I worked on day and night, 7 days a week for 3 years. Guess what? The startup failed, and I wanted to get a job in sales. Since I was a founder with a ton of experience with my own company, I really didn’t want to get a job as a junior salesperson, so I applied for the more senior level, the one that I wanted. Nobody wanted me. I said, Ok fine, I will start from the bottom and show them how good I am, so that I can get to the job that I wanted. One of the companies decided to hire me, I showed them my work ethic and my performance was really good, and within 8 months I got promoted to the job I initially wanted.
There are a lot of ways that you can add value here, even if you start at the very bottom. For instance, a lot of smaller firms and family offices don’t take advantage of any technology. What if you start being the face of the company online, what if you create the company’s online presence, and also start finding ways that they can improve their properties with the use of technology? - You can start investing in syndications, this allows you to invest a small amount of money, and at the same time familiarize yourself with the paperwork, terminology, how companies evaluate deals, how they pitch deals, etc. Note that for some syndications you have to be an accredited investor, which means you need to make more than $200k/year for the last 2 years, or if you’re married, a combined $300k/year, or your net worth must be over $1M, not including your primary residence. However, not all syndications are only for accredited investors, there are quite a few out there that allow people with less income to participate.
- If you know someone that is a successful commercial real estate investor, you can have them be your mentor. Just make sure that you add value to that person, like bringing them deals based on their requirements, or whatever it takes. And make sure to follow up, follow up, follow up. I can’t tell you how many people reach out to me asking for help and we have one call, I give them some homework, and they never follow up.
- Build relationships with commercial agents in the area. Start joining their mailing lists, start asking for OM’s (offering memorandum). This way they will familiarize themselves with your name and you’ll start to learn who may be a good broker to work with. After I joined a few self storage broker’s newsletters, I now know who has reasonable deals and who is always pitching overpriced properties, I don’t even open the overpriced broker’s emails anymore.
- Start playing the Cashflow game by Robert Kiyosaki, it’s a very good game for you to start understanding how real estate investing works and how you can grow your net worth. You can either buy the board game, and invite your fellow real estate friends to play with you, or you can play on their website for free.
How to Grow Your Network:
Now, let’s move into building your network. Nobody gets anywhere alone, everyone that is successful has gotten there with the help of many, many people. So your network is a top priority.
- Join Meetups in your area, even if they’re only doing online events, start attending them and getting to know people in your area.
- Go to as many real estate events and conferences as you can. You want to meet as many people as possible, make a note on their business card of what they focus on, make a note on what you guys talked about, if they have kids or what are their hobbies. When you get home, transfer all your contacts to a spreadsheet, or a contact management app, and send them an email saying that it was great meeting them, and add them on Linkedin.
- Make a name for yourself, start to be active in any platform such as Linkedin, Biggerpockets, Facebook groups. You want to join real estate groups in any of these platforms. Spend a few minutes everyday commenting on posts, and sharing insights.
- Check in with your network every few months. This can be done via email, Linkedin, Facebook if you added them there, but the best of all is always a phone call. I’ve created a couple of partnerships simply by checking in on people on a regular basis and seeing how they are doing.
How to Make Your First Investment if You Have No money:
- After you find a good property, and have shown to your network that you are learning all you can, invite friends and family to invest with you.
- If no friends or family are interested in joining you, partner up with someone experienced. If you have a property under contract, you can always give a significant percentage of the deal to that person, just so you can have the deal under your name and you can show your future investors what you have done with that first property.
Buy and/or Play the Cashflow game here: https://www.richdad.com/products/cashflow-the-board-game