STRATEGY
COMMERCIAL INVESTING
HOME-FLIPPING RATE TRACKS HOME PRICE APPRECIATION ANNUALIZED HOME-FLIPPING RATE ANNUAL HOME PRICE APPRECIATION
15.0%
9.0%
8.0%
10.0%
Co-Everything in Commercial Real Estate
7.0%
5.0%
6.0%
0.0%
5.0%
4.0%
-5.0%
COLLABORATION IS KEY IN THIS REI SPACE.
3.0%
-10.0%
by Pamela J. Goodwin
2.0%
-15.0%
here is a new buzzword in commercial real estate: Co-Everything. Coworking spaces have evolved from the days of a group of artists sharing space into a billion-dollar business. Back in 2007, the trend was almost unheard of with only 14 locations in the U.S., but recent projections estimate more than 26,000 collaborative spaces by 2020. You may have heard of industry giant, WeWork Com- panies Inc., founded in 2010 and headquartered in New York City, now valued at $47 billion. Coworking spaces offer what startups and entrepreneurs are looking for when it comes to office spaces — flexible lease terms, lower costs, fewer responsibilities, networking op- portunities, support for startups, and sometimes free wine and beer. With several large retailers downsizing, the spaces are being converted into a collaboration of innovative spaces to be shared from individual pop-up stores to beauty salon suites. Staples, Inc. announced a new collaboration to offer coworking facilities within select Staples retail loca- tions. Each of the 2,500-3,500 sf spaces will offer high- end workspaces, conference rooms, and even bottom- less coffee and tea. Coworking just became co-flying. Seattle based The Riveter is partnering with Alaska Airlines to exchange benefits. The option to exchange complimentary day passes to The Riveter locations will be available to Alaska Airlines members, and in turn, Alaska Airlines will provide day passes to Alaska lounge locations. T
While shopping on vacation in Chicago, I stopped by the local Target and in the front of the store was high-end retailer Vineyard Vines selling a variety of its products. Collaborating allows the higher-end brand to be seen by more people and reach new audiences to create a bigger bang than it would on its own. Prices start at just $2 with most items under $35, making the brand affordable to nearly all consumers. Target was one of the frontrunners in the affordable-luxury move- ment and will continue partnering with various design- ers and top brands. Have you ever wanted to bring your dog to the movie with you? Well, now you can at K9 Cinemas in Plano, TX. The cinema also includes complimentary, bottom- less wine and whiskey with every adult ticket when you bring your dog to the movies! The company is also launching a coworking space that is simple, affordable, and dog friendly. Kohl’s began collaborating with Amazon to accept customer returns, providing another way to drive traffic to their stores. According to CNN, traffic in Chicago
1.0%
-20.0%
0.0%
According to this line of reasoning, the increase in flipping in the first quarter of 2019 may in fact be a leading indicator of improving home price appreciation that leads to improved flipping returns for home flippers later in the year. The buy-and-hold rental investment strategy provides investors more flexibility upfront on acquisition price, ac- cording to Lizell, who also has developed a training program to help investors purchase properties at auction. Lizell rec- ommends that investors buy below full “after-repair-value” for fix-and-flip properties, but that upfront discount could be lowered if the property can be held as a rental. “If I was going to flip the property I might be able to pay 80 (thousand) for it, but if it was a rental I might be able to pay 90 [thousand],” he said. •
RENTALS TOP INVESTOR STRATEGY FOR 2019
Rehab-and-flip to other investors (turnkey rental) 8%
Wholesale (flip without rehab) 17%
Buy and hold as rental 38%
> Continued on :: PG 96
Rehab-and-flip to owner-occupants 37%
A licensed broker and owner of her own successful commercial real estate firm, Goodwin Commercial, Pamela has closed multimil- lion-dollar deals across 80 cities and 16 states. As a certified in- structor, best-selling author, and in-demand speaker with hands-on experience, Pamela excels in helping others learn all sides of commercial real estate from tenant, landlord, developer, broker, and investor perspectives.
Daren Blomquist is vice president of market economics at Auction. com. Inthis role, Blomquist analyzes and forecasts complexmacro and microeconomic data trendswithinthemarketplace and greater industry to provide value to both buyers and sellers using the Auction.complatform.
Source: Auction.com 2019 Investor Insights Survey
54 | think realty housing news report :: august / september 2019
thinkrealty . com / hnr | 55
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