Commercial real estate is something many investors seem to be interested in both as an asset class as well as a place for operating their businesses. Justin Smith, a broker, industrial advisor, and author, joins us today to talk about investing in commercial real estate. Throughout today’s episode, we explore what investing in commercial real estate is like as an asset class and what business owners who are considering buying buildings for their own businesses need to consider prior to day one and from day one to the day that the business no longer occupies the building. Stay tuned until the end of the episode, where Justin shares some strategies that help real estate investors with taxation.
[2:50] Justin’s Background – Justin has been working at Lee and Associates for 17 years, focusing primarily on industrial property. We talk about how Justin got into the real estate industry and what he learned through his long career.
[9:40] Buying a Building – Justin explains where to start if you’re looking for a building to buy and how the process differs according to the type of business, type of property, and whether it’s a lease or ownership.
[20:05] Transition From Tenant to Owner – Switching roles from the tenant to owner often calls for some construction work. Justin explains what potential property owners should know about working with contractors and other parties and maintaining compliance.
[26:55] Selling the Current Building and Purchasing the Next – What business owners need to think about when selling their current building to move to another and how their options differ based on liquidity, capacity, and capital.
[34:41] Potential Property – What makes a potential property or building an attractive investment in a portfolio, and what to look for in a potential real estate investment in terms of its cash flow.
[42:45] 1031 Exchange – Justin shares his thoughts on the future of the 1031 exchange, which gives business owners an option to avoid paying capital gains taxes when selling a property and reinvesting in similar properties.
[46:30] Tips for Pure Investors – Justin shares some tax strategies for people who are looking at real estate as a pure investment.
[49:00] Industrial Intelligence – Justin’s book, Industrial Intelligence: The Executive’s Guide for Making Informed Commercial Real Estate Decisions, came out last April. We talk about what he covers in the book and how it helps investors make smarter decisions for real estate investments.
Industrial Intelligence: The Executive’s Guide for Making Informed Commercial Real Estate Decisions: amazon.com/Industrial-Intelligence-Executives-Commercial-Decisions
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