One of the reasons why I am ALL IN on flex space real estate, is because it’s just better than “traditional” real estate, AKA office buildings, retail, and residential real estate. What is great about flex space is that this asset class is extremely lucrative and profitable. Instead of burning out trying to make millions with traditional real estate, a single flex space deal can change the entire game for you. Let’s compare the costs of traditional real estate, to the costs of flex space real estate.
There are two things I take into consideration when I am breaking down the price of real estate projects:
- Time and effort
- The actual cost.
Time and effort.
This is the number one thing I take into consideration when looking at the price of these developments, and it should be the first thing you look at as well. I am able to get in and out of flex space deals in two years, making a 2-3x return while I’m at it. Not only can I get tenants into my developments quickly with my marketing strategy, and phase out development strategy, once they are in there, I am headache-free.
You cannot get this with residential real estate. You’ve heard my multifamily horror stories, I used to stay up running around dealing with tenants every single day. Now, I don’t have to worry about anything other than growing my business.
The actual cost.
When comparing flex space to traditional real estate, flex spaces are much cheaper, easier to build, and quicker to get leased out because there’s not as much detail in flex as there is in, for example, office, or retail real estate.
The other thing that you have to take into consideration within price when you are doing an office, retail, or any other type of commercial real estate, is to consider what’s called a TI , a tenant improvement allowance. A TI could run you up hundreds of thousands of dollars per tenant. In flex space we don’t have that. We eliminate that completely because we do standard build outs of offices and restrooms for each space. This allows us to keep our costs significantly low, and it also allows us to complete all our projects earlier because we know exactly what type of build outs are going inside each of our flex units.
When you’re dealing with offices, you don’t know how your tenant is gonna come in and design each individual office, where they’re gonna want the offices, where they’re gonna want the bathrooms, or where they’re gonna want anything else. This is the same thing with retail. Tenants who want a gym, restaurant, etc are all going to want different things. With flex space we are able to cater to all types of businesses.
Take me for example.
Currently I’m building out my own office and because of the way we designed it, we are about eight months behind schedule due to the way we wanted it designed. And let’s not even mention the fact that we are double what we initially anticipated for budget as far as expenses, and this has maxed out the tenant allowance the landlord gave us.
With flex space real estate, we don’t have to worry about our tenants’ buildouts apart from the office and bathroom space we gave them. Due to this our building operating times and our construction times are half, along with our expenses for build outs being zero since we do not do anything additional to what we have already provided.
If you want to learn all my proven hacks for how to create a successful, and profitable flex space development, sign up for my mastermind Flex Space Untapped, where I have saved hundreds of thousands of dollars for my members.