Things I Would Never Do As A Commercial Real Estate Pro

This week's listener of the week is Jess Knows Real Estate. Jess, thank you for your five-star review. And for those of you listening, if you leave us a five-star review below, you might be next week's listener of the week. Week, week. So I get calls all the time from prospective tenants. And when I tell you I have heard it all, I really have. Actually, that's not true because I'm still being surprised with what people can come up with, but.

I'm going to tell you in this episode of Commercial Real Estate Secrets, three things I would never do as a landlord. So I'm always fielding calls from tenants and there's an interesting one I get where people want to breed bugs in warehouses to then sell to pet stores. And

This reminds me of a conversation I had with a gentleman years ago who had a warehouse and he let a tenant breed lizards in the warehouse. And even after the tenant vacated, they were finding lizards in the warehouse for years to come. And this is a common thing I also see with the bug breeders is that naturally if you have tens of thousands of bugs,

in a confined area, they will escape. And to be quite honest, you'll be finding bugs in the building for everywhere, or for years. So, and this will upset your tenants, spoiler alert. So I think when you think about a warehouse, it's a box, right? And people think you can just lease to anyone.

but it's important to understand that there are adverse effects to leasing to anybody that would maybe impact you as a owner, your building as a property, or your tenants, right? So we buy warehouses, we deal in warehouses because of how simple they are, but you have to be thoughtful of who you put in there. So...

Aviva Sonenreich (02:19.626)

I talk about this sometimes how there's like a hierarchy of tenants, right? Top of the food chain when it comes to warehousing are like environmental remediation. That's a big one. Any type of clean e-commerce that does well. These are tenants that when they come to your door, you want. Construction, the trades, you know, these are your A-class tenants. Then you start getting into some...

some less desirable tenants. For example, a big one is the granite industry. It's really well known if you've ever had a granite tenant before that if they're cutting granite in the unit, they will completely destroy the unit. I know when I walk into a unit, if it has had a granite supplier in the past, in the first two seconds. So having an understanding of the

what tenants will damage your building the most or leave you with crickets and lizards for years to come is really important if you want to have a simple property, simple tenants, simple income stream. So if you...

Do not choose to monitor your tenants properly. You will be getting calls from your other tenants for years about the crickets that have infested the entire building. And that's completely avoidable. I empathize with the bug breeders. I wish you nothing but success in your business endeavors. Just don't go into any warehouses that I have anything to do with because I have an irrational fear of crickets. So what can you do?

in your day to day as a property owner or investor or a warehouse broker that can set you up for success with your tenants. One, you don't have to lease to anybody, right? You can use your intuition if you don't feel comfortable, if you do feel comfortable, it's okay to go with your hunch. Two.

Aviva Sonenreich (04:40.586)

It's completely acceptable to ask for financials. In commercial real estate, right, we're renting to businesses. So a business should have their financials available and it's industry standard to look at them. So don't be afraid to ask for financials. Another way to do it is to just hire a professional. I see folks who own properties rent to the wrong people.

destroy their properties and then come crawling back after the property's already been destroyed when they should have just hired a professional in the first place, right? You want to put the people who excel in certain positions where they should be, right? And if you own a property and you're not qualified to rent it out because you might rent it to the granite person, don't. You're gonna save a lot more money working with a professional up front.

And then another big one to avoid headaches as a landlord is to go to the tenant space prior to signing the lease. So say you meet them, hey, I like you. Can I stop by your current shop? Stopping by and you know, first off, their reaction will tell you everything you need to know, right? If they don't want you to come by, that's kind of weird. But generally they do want you to come by. And then you show up. And if it's a mess.

right? Or if they're not even doing what they said they're doing, right? There's so many ways to pre-qualify your tenants before they are ruining your building units, all that good stuff. Another really good example of this is like, some tenants will have to paint and stain furniture or sets, right? We've got tenants who build festival stages or tenants who build

movie sets. Well, sometimes if that tenant is painting or staining the product, it can really, really hinder your other tenants because the smells of the chemicals will come through and drama will ensue. So it's really important to understand these key factors that stand out about individual uses of tenants.

Aviva Sonenreich (07:08.694)

before putting them in the property. And that's probably why, if I'm blowing your mind with all this information, you should probably just hire a professional to lease your building, at least in the very beginning. Now, what questions do you have for me? DM me on Instagram at Aviva Real Estate. If you wanna get started in commercial real estate, head down to my show notes for my free guide, how to get started in commercial real estate.

We'll see you next week.