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Sensationalism is everywhere and it's hard to know what's real, anymore. The economy is tanking, the marketing noise is deafening, and you just don't know what tomorrow will hold. This site is dedicated to a no-hype retelling of what's working for me in real estate, business, and life. Welcome.

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Archive for Commercial


In Commercial Real Estate, Cap Rates Are Up – Is It Any Real Surprise?

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You’re hearing about it when you talk to your real estate agent, you’re painfully aware of it if you’ve thought of selling a property, and maybe you’re excited about it if you’re out hunting for a deal.  The big news is (drum roll…) cap rates are up!

(Don’t know what a cap rate is? Check out my diatribe about cap rates and how to use them and when to ignore them!)

Does This Mean My Real Estate Agent Won’t Laugh At Me Anymore?

If you’ve been following commercial real estate for any length of time, you’ve probably been discouraged by the one-two punch of (1) gurus telling you to get out there and look for high cap rate properties that will cash flow, and (2) your real estate agent chuckling about whether you’ve been to a seminar lately and thinking, “Yeah… sure!  If that type of property comes along, I’ll just buy it myself.”

I will digress again to say that real estate agents are actually NOT usually your big competition in finding good deals.  In my experience most of them do not invest themselves, don’t have the cash on hand to buy big deals when they see them, are more interested in the “quick hit” of getting their commission, and (best!) didn’t know the seller would take that low offer you just made!

Real Estate Agents don’t have the cash on hand to buy big deals when they see them, are more interested in the “quick hit” of getting their commission, and (best!) didn’t know the seller would take that low offer you just made!

The fact is,  you can always snatch up great, below-market real estate deals if you’re willing to be persistent and take the time to look for really good properties.

Does This Mean I Can Find Great Commercial Properties To Buy Now?

So what’s happening now… suddenly you don’t have to be persistent to find the good deals?  Good properties that meet your “guru’s” buying guidelines are starting to pop up all over the place, aren’t they?  High cap rate properties abound!  What’s going on?

Even in the Seattle commercial real estate market, one of the strongest in the country, we are seeing cap rates go up.  Agents are telling investors who are considering selling any time within the next few years – “Sell now, this is as good as it’s going to get, it’s going down from here (or running flat, at best).”

People Are Paying Less For Property Because There is Greater Risk In the Marketplace

The higher cap rates are simply a reflection of the declining expectations for property values.  No one wants to buy a property that’s going to be WORTH LESS in a few years time, that’s why seller’s are having to discount their prices TODAY to entice buyers to come on board.

Pay Less Attention to Cap Rates, and Greater Attention to Market Cycles!

One broker told me he thought there was a 25% disparity between what sellers thought their properties were worth and what buyers thought the properties were worth.

Novice investors beware – there are lots of great-looking properties flooding the market right now, if you only look at cap rates.  This is an important time not to be blinded by the short term or historical performance of the property.  Look at how the property is situated to ride out the still-declining market cycle.

If you’re in it for the long haul and plan to be buying through-out the dip, then yes, by all means, go for the good deals (negotiate hard though, buyers with cash or financing in place are especially in demand right now).

If the deal is right, it’s always a good time to buy.  If the market is right, it’s easier to find a good deal.

But if you can only buy one property in the next few years and you want to make sure it’s a winner.  Keep looking for motivated sellers and CREATING (through offers and negotiation) good buying opportunities.  Buyers are king in this marketplace.

Also, when you’re running your figures, throw in a big grain of salt to account for the risk you’re taking.  There’s a reason cap rates are rising!

– When somebody’s down, someone else is up! –




P.S. We haven’t hit the bottom yet, in most real estate markets.  To find out where we are in the market cycle for the real estate markets you’re in – check out this service!

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Grassland Investments Creates Dedicated Blog for Commercial Real Estate

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  • Do you have an interest in commercial real estate investing, but not know where to start?
  • Have you dipped your toe into the world of commercial real estate, but are now unsure of what’s coming next, given the changing economy?
  • Are you looking for a way to stay up to date on the news that affects commercial real estate WITHOUT being overwhelmed by dire headlines day after day?

If you answered yes to any of these questions, you’ll probably be glad to know that my real estate investing partners and I are joining forces to create a new blog focusing specifically on challenges and opportunities faced by real-life commercial real estate investors in today’s marketplace.

What Will The Commercial Real Estate Blog Focus On?

The new blog will focus on two things:

  1. Timely news articles about what’s going on in the economy and how it affects real estate values today.  Are we in a Recession or a Depression?  What should we invest in during a recession?  What are interest rates doing – are there any lenders still in business?  Can they lend on your next project?  When will the economy recover, how will we know, and what should we do about it when it happens?

    We’ll be covering topics like these on a regular basis with a focus specifically on commercial real estate investment.  As a group, on that blog we’ll try to avoid being distracted by some of the topics I write about here, like the stock market, small business, and the residential real estate market.

  2. Commercial Real Estate Investing Resources – we want this to be an encyclopedia where we’ll share some of our best practices and real-life strategies for dealing with all sorts of things that come along in the world of commercial real estate investment.  Here are some of the topics we’ll cover: real estate acquisition, financing strategies (including bank loans and raising private money), property management and managing your professional managers, keeping costs down, increasing profit margins, and knowing when to sell.

We hope to eventually attract some great contributing authors, add some audio and video, interview other experts and just plain have fun!  It will be a friendly "help and be helped" environment, and we can’t wait to get it started.

We have not officially launched the site yet, we’re still building up our article library so we can be sure to have plenty of great content.  In fact – we’d love to have your help TODAY in building that content!  This is your chance to ask us all your questions for free and have the chance to read our detailed answers. 

My partner Rob Powell just got a question from one of our clients about his strategy to acquire commercial property in Pittsburgh, PA and Rob asked all of us at Grasslands to take a crack at answering.  A whole panel of experts at his disposal – and we’ll post the question and answers soon!  I just wrote my reply and sent it off to Rob to post to the blog.

Send Us Your Toughest or Most Burning Real Estate Investment Questions!

Now it’s Your Turn!  Email me (or comment below) with your best commercial real estate questions and I’ll pose them to our panel of experts.  As soon as the blog is released (scheduled for January 2009), I’ll send you a link and you can find out exactly our opinions on the issues that mattered to you most!


On that note, if you have other questions for me about residential real estate, stocks, investing, budgeting, retirement planning, and the like, ask me those, too, and I’ll answer them right here on the blog.



Categories : Commercial, Real Estate
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Goodbye Marcus & Millichap

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It would be easy to say that, after a few short months working at Marcus & Millichap as a commercial real estate agent, that throwing in the towel so early in the game would be a striking failure.

It is, in fact, with some chagrin that I write this post.  But I promised to be open and share my real life ups and downs here, so consider this article in keeping with that theme.

Just to bring you up to speed, since I wrote NO POSTS the WHOLE TIME I was with the firm, here’s what’s been happening.

What It’s Like To Be a New Commercial Real Estate Agent

I started working (no salary, 100% commission) on September 4.  I put my baby in day care, where he was the First In (7AM) and Last Out (6 PM) every day.  I would get up at 5:30 in the morning, commute into work for an hour, work from 8 – 6, and arrive home at 7 PM to feed my baby while my husband made dinner and then pack lunches and put the baby to sleep, succumbing to the sand man myself at around 9:30 PM.

After attending a new-agent training week in California, the days were very intense and involved about 5 hours of cold calling a day.  This level of cold calling was projected to lead to about 2-4 deals completed in the first 12 months on the job.  Since most new agents do their first deals with a mentor (50% commission split) and have to pay their broker (Marcus & Millichap) 50% of the commission, you can see that a 6% fee on a $1 Million building sale would only result in a $7,500 check to the new agent.  That means my projected income for the first year would have been about $15,000 – $30,000.  Of course, things would presumably improve after that, but there is about a 3-year ramp up in this line of work.

I knew all that going in, for the most part, although it was certainly not featured in the interview.

The main challenge with the position was the time commitment.  I had the sense that real estate agents were able to "set their own hours."  To a certain extent that’s true.  But, like many entrepreneurial ventures, when you’re your own boss, it’s often the schedule that takes control, rather than you.  The work hours expected to meet the sales goals at this firm were my real objection to continuing on there.

Big Time Commitment Needed To Ramp up When You Become a New Commercial Real Estate Agent

The aggressive cold calling schedule didn’t allow much time for all the things I thought being a broker was about – visiting clients, getting to know the buildings in the area, selling property, etc.  There seemed to be an expectation of a lot of additional work (late nights and weekends) in order to meet the company’s productivity goals.

I’m not saying it’s a bad job.  :)  At a different point in my career (right out of school, no family to support, except perhaps a spouse or parents supporting me…) this might have been a fantastic fit.  And I’m sure it gets easier as you get more experience.

While I was there, I learned a lot about the firm, and I think they’re a great agency.  In fact, if you do consider selling a piece of commercial real estate, let me know, I am now in a position to tell you a lot of things to keep an eye out for.

All I’m saying is, it’s not the right job for me, at this time in my life.  I need to be able to smile at my baby (without breaking into tears from guilt, exhaustion and disappointment) and have a conversation with my husband in order to stay sane.


Lessons Learned:

  1. It is not worth it to me to work 12 hours a day out of the house and away from my 6-month old baby at a job I do not enjoy and saps my energy.
  2. I got into the business to help people and deliver services and expertise.  It seems that only about 10% of the job involves service fulfillment.  The other 90% involves hunting people down and cold-calling (Harassing them?  It seems like some people in my farm area were getting calls from agents 3 times/week!) in an attempt to provide value and hopefully create a relationship that will lead to being hired at some point down the road.
  3. My communication skills are better used in teaching/educating/ and communicating with people rather than SELLING people.  I do believe I can "sell" in the right environment – e.g. by working with people who are interested in working with me – however, I am not good at "pushing water uphill" or "selling ice to Eskimos."  I thrive on relationship-building when it goes "both ways" and is not antagonistic.
  4. It’s always a good idea to talk to people who are in the business and find out what they are like (personality-wise), what they think of the job, and what they think led to their success. 

    I found that, of the experienced agents in the field, I could relate to and connect with very few of them.  That was very unusual for me, because I consider myself a friendly person and I really enjoy meeting with new people and forging new relationships. 

    At first I thought the old hands in the office were just aloof because they were busy and/or I was new.  Now, I think that the position just appeals to people with a certain amount of emotional distance because it can be so emotionally draining to constantly hunt for prospects and face rejection.

    I always thought people in sales were friendly, but seeing them in their natural environment, behind-the-scenes, that was certainly not my impression in this case.  (There were a few exceptions, some nice guys that I had lunch with and a lot of the new people seemed friendlier.)  Now I think sales people are just tough.  They have to be thick-skinned and not overly concerned with what other people think, in order to survive in their chosen careers.  It’s not just about "helping people," which had been my impression before.


All told, it has been a very emotional and draining couple of months.  I decided, with the support of my husband, that I did not want to make it an emotional and draining couple of years. 

I’m not sure what I will choose to focus on next, but I am fortunate to have people around me to help me remember the positive… "Don’t label yourself as a quitter or a failure, Emily.  Chalk this up as a success in finding something that is NOT a fit for you, and deciding that quickly, giving you more time to pursue your passions."

It’s good to have that kind of support when going through these types of changes.

If you have any questions about becoming a commercial real estate agent, I am now in a much better position to answer them. :)  I’ve already gotten some emails in that vein based on my prior post. 

Let me know how I can help!


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Marcus & Millichap, Here I Come!

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So, the news of the week is that I have decided to hang my commercial real estate broker’s license with Marcus & Millichap.  I have had good experiences working with brokers from this firm in the past and I believe they have an excellent training program for getting new agents up and running quickly and with best practices.

Why This Real Estate Agency?

After interviewing several other commercial real estate brokerages in Seattle and Bellevue, I liked Marcus & Millichap because I believe their platform creates a lot of data that will support the property sellers’ ability to price their properties well, optimize income and minimize expenses, and anticipate changes in the market places, all so that they sell quickly and for maximum profit.  Basically – by working there, I will be able to provide a lot of value to my clients.

The company has a niche in working with primarily sellers (rather than representing buyers, tenants, landlords, etc.) and specializes in properties worth $1 – $10 Million.  In the Seattle real estate market, most buildings that fit this classification are owned by individual investors (like me!) rather than corporations, REITs, full time real estate professionals, or  institutional investors.

Since I really enjoy *connecting* with people, and being able to relate to their needs, I am looking forward to working with this type of client and being able to provide them services that *I* as an investor myself, would also appreciate.  I think that is exactly what I’ll be in the position to do with this firm.

Getting Started as A Commercial Real Estate Agent!

I start working at Marcus and Millichap at the beginning of September and my understanding is that my first task will be to choose a market area and become very familiar with it.  I’ll be driving the properties, taking pictures of them, finding out what rents are, talking to tenants, chatting with neighbors, and generally putting on my detective hat to get the lay of the land.  It should be a lot of fun and I am pretty excited.

At this point, I’m thinking I might specialize in apartment buildings in the north end of Seattle.   Why? Residential rentals are the property class I have the most experience with and the north end being where I live. :)  I’m open to changing that, though, based on where the opportunities lie.  Maybe I’ll end up working in mobile home parks, self-storage, retail strip centers, or something I haven’t even thought of yet.

The Biggest Challenge of All:

IMG_2858 The hardest part of the whole thing, I think, will be not being home with Blake all day.  Now, working from home, I get to watch him smile when he wakes up from a nap, sing to him, make funny faces at him while we eat lunch together, and smell his sweet baby scent.  I will miss that while I am working, but I know when he is older (his talking, walking toddler years seem like they’re approaching all too fast!), he won’t find it fun to idle away his afternoons sitting in his bouncy seat and watching me work from home the whole time. 

I think he will come to enjoy preschool, learn from the other kids and teachers there, and we can all treasure our time together in the evenings and on weekends when we have time to focus on each other exclusively.  Perhaps by the time that baby number two comes around, we’ll end up having Ben stay home to be with the kids and work on his writing career.  There are lots of possibilities!

So, off I go, embarking on my new career as a real estate agent.  I’m moving quickly and am ready to learn!


Real Estate Networking 2.0

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Lately I have been exploring new ways to network with people… first there was which my college roommate had joined.  Then there was where all the professionals seem to meet.  After my high school reunion, I joined to see what all my old classmates were up to.

But now I have found the ultimate in online networking for real estate professionals.  This is a place where realtors are helping each other (no nasty back-stabbing competitiveness), leads are being exchanged (and money made!), and realtors are moving to the top of the search engines for local search – building their credibility and exposure, all for free!

Commercial Real Estate - Seattle, WA Emily J. Cressey: Commercial Real Estate Agent in Seattle, King County, Washington

It’s called Active Rain and after much (hours) of poking around there yesterday, I decided to create an account there.  I have started an industry-specific blog on commercial real estate investing in Seattle, WA, joined several networking groups (they have groups for realtors, investors, short sale gurus, mortgage brokers, appraisers, real estate trainers, escrow agents – virtually everyone involved in real estate!), and set up my profile.

In less than 24 hours, I’ve already had over 15 people welcome me to the community.  It’s an amazing place.

If you are a real estate professional and have been interested in building your business online, I encourage you to check out Active Rain.  One of the big agents there is getting 2 listing leads per week off her online presence there.  She is an agent and she also works a lot of short sales, so it’s clear that there is value here no matter which side of the fence you’re working the business from!

Hope to see you there!


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About Emily Cressey

Emily Cressey is a real estate investor and licensed real estate agent living in Seattle, Washington. After graduating Phi Beta Kappa with an Economics degree from UNC-Chapel Hill (Go Tarheels!) her focus has been on building business for cash flow and investing in real estate for wealth. If you have questions about real estate investing, personal finance, or would like some flat-rate, affordable advice on one of these topics. Please fill in the Contact form.