Do You Have the Right Mindset to Own Commercial Real Estate?

do you have the right mindset to own a commercial real estate well most people don't and that's why they own none yes there are challenges you have to overcome in order to buy your first commercial property but by far in my experience the biggest obstacle is stinking thinking that's right stinking thinking i'm going to share with you what the wrong mindset is and why it stops you in your tracks i'm also going to share with you what the right mindset is so that you can begin your journey on buying your first commercial property hello everyone i'm peter harris with commercial property advisors i'm author of this book commercial real estate investing for dummies i'm also author of my new best-selling book commercial real estate for beginners i'm also a coach and mentor to many commercial real estate investors all across this country today i'm going to ask and answer the question do you have the right mindset to own commercial real estate i'm going to address real quick four things number one is what is the right mindset that brings breakthrough in owning your first commercial property no matter what your economic or financial status is number two what the wrong mindset is that causes you to stand still and watch as everyone else prospers number three where did the wrong mindset come from what did it originate from i'm going to share that with you and lastly number four how to replace the wrong mindset with the right mindset in order to begin your journey on buying your first commercial property let's get started all right here we are before i get started on sharing with you what their right mindset is let me share with you what the wrong mindset is all right here's the wrong mindset i call it the customer mindset that's right customer mindset a person with this mindset with the customer mindset is focused on the cost of something not the benefit they are focused on can i afford it again they're not focused on the benefit and lastly they're focused on if i spend something i'll end up with less again with the combination of all three they're not focusing on the benefit the result of that is they believe they have a belief system that only the rich can afford commercial real estate this is the reason why a person with a customer mindset doesn't own any commercial real estate right here's what happens right a person with the customer mindset immediately starts to count themselves out number one right number two they begin to be intimidated by the cost of commercial real estate now the result of those two with um counting yourselves out and being intimidated it causes them to become mentally blocked right and when you become mentally blocked in commercial real estate guess what happens you're not thinking about if you can buy their property with what uh what creative financing which you do a lot in our company they're also not thinking about using seller financing to do their first acquisition they surely aren't thinking about our favorite technique which is the master lease agreement and lastly without a doubt they're not thinking about raising capital for their first deal so what happens is because they count themselves out they're intimidated and lastly there's a mental block guess what happens they negate every commercial real estate opportunity that gets in front of them every deal that comes before them is negated they believe that they can't do it because of those reasons so i have a question for you do you have a customer mindset do you well before you answer that question i'd like to share with you an example of what one looks like what does a customer mindset look like i'm going to give you three really quickly quick examples here's example number one a person with a customer mindset says this peter property renovations cost too much right that's a person with a customer mindset that's the person who's focused on the cost of something rather than the benefit i'm going to share with you really quick of a real deal of an example one of our student deals he bought a 24 unit property where there's only one water meter right he's paying twenty six thousand dollars a year he's paying for all the tenants water and he decided because he has the right mindset to spend the money to uh individual meter out the water right and it's gonna cost him one thousand dollars per unit per apartment unit so we have 24 units times one thousand dollars so it cost him 24 000 to do the conversion right so once the conversion is done that 26 000 a year in water is passed off to the tenants that 26 000 goes to his cash flow goes to his bottom line now that's benefit number one right benefit number two is as you guys know from watching my previous videos as the noi goes up so does the property value right so if the if the noi goes up by twenty six thousand dollars and he's in a eight percent cap rate area we can divide the twenty six thousand dollars by eight percent and come up with three hundred and twenty five thousand dollars in increased property value right so as the noi jumped up by twenty six thousand dollars the property value went up by three hundred and twenty five thousand dollars a person with a customer mindset would not spend twenty four thousand dollars to get that benefit got it let's move on number two example number two a a person who has a customer mindset is a person who buys a low cost commercial property right only because they can afford it right that is a customer mindset you see in my world in a commercial world right there's no such thing as low and high price okay no sustain don't care about it doesn't exist also secondly my world there is no such thing as cheap and expensive don't care about it we'll never even consider it what is important though for those of us with the right mindset is does it have a low roi or a high roi okay a person with the right mindset is focused on return on investment got it a person with the customer mindset is focused on if the price is high or low they focus on if it's cheaper expensive that's the wrong mindset let me give you a third example our country goes to ebbs and flows in the economy sometimes when there is a recession financial hurt happens right people lose properties people lose property value people lose properties right the person with the customer mindset a previous failure has caused them to give up the dream of owning commercial real estate in fact they they say now that real estate is not for them or that they cannot recover from that failure that is a person with a customer mindset in just a a few short minutes i'm going to share with you how to make a comeback if that's you but in the meantime i have a big question for you here's a big question is this one of you do you have a customer mindset do you well you don't have to answer that question right now because what i want to do first is i want to go over with you what the source of the customer mindset is you know where does it come from let's do that next before i share with you what the right mindset is where did this customer mindset come from i have three sources to share with you the first source it probably came from your parents upbringing the customer mindset has been ingrained in you since birth number two a society society spends company spends billions of dollars in advertisements on the internet tv and radio and advertisers to bombard you with the customer mindset to keep their companies going so what it does it causes you to conform right to what they advertise to be average and to stay within your limits a person with the right mindset does not conform does not have a goal to be average and certainly does not stay within its limits now the third source of customer mindset is taking the path of least resistance in terms of thinking you see thinking is difficult and that's why a lot of people don't do very much of it right so here's what happens uh a person with a customer mindset who desires to own commercial real estate doesn't go together just like old and water do not go together right does not go together so doesn't a person with a customer mindset wanting to own commercial real estate in fact they're probably better off not owning commercial real estate and the reason why is it will probably lead to an eventual failure okay alright so that's what i want to share with you on on where did the customer mindset come from the last part to share with you is what the right mindset looks like finally here is the right mindset to own commercial real estate i call it the entrepreneur mindset you see the entrepreneur mindset is focused on roi right return on investment return on investment right they'll ask four questions generally when a an opportunity appears number one is how can i acquire that property right that's the mindset how can i acquire it right the second question is what funding sources would love to be part of my deal and number three what benefit would i get out of buying this property would it get me closer to retirement will it get me closer to leaving my job i don't [Music] is it to leave my available is it to build a retirement is it builder portfolio is it that to build a ministry to do charity work i don't know what it is but there needs to be action massive action taken to meet your goals the secondary focus of a person which an entrepreneur mindset and this is really true is their focus is on their i call it my wealth ratio okay wealth ratio is a very very important number what it is here's the equation it's your passive income stream divided by your monthly living expenses right so once your passive income stream equals your monthly expenses equals each other that equation equals one that means you were out of the rat race right so the the focus here is on developing and increasing your passive income stream through commercial real estate uh ideally if you can get your your wealth ratio up to 1.5 i would say you are safe to leave your job okay uh reaching one is monumental and it's great but get to 1.5 and i will feel much better of giving you the thumbs up to leave your job okay so that's something you should shoot for all right the other thing i did promised to you earlier where i would discuss with you how to make a comeback from failure well many many entrepreneurs have had failures in their lives right but the person with the entrepreneur mindset makes a comeback and so i'm going to share with you what the comeback plan looks like now the person with the entrepreneur mindset they do not let past failures define their future they don't right they don't now here's a plan for their comeback that works okay it's been tested number one is when you're coming back from failure don't take your failure personal get over it it happened it's in the past you have to move forward okay number two get knowledge that you haven't had before get a mentor do something that you haven't that you haven't had before this is the second part of making your comeback number three is you need to jump back in okay once you get your knowledge once you get a mentor someone to help you you need to jump back in but this time you are going to measure twice measure twice and cut once okay so you you're able to do that better now because you have a knowledge and you have help and lastly number four really important now on making this comeback is only invest in cash flowing commercial estate okay long term if i need to say that cash flow commercial estate long term gone are the days of speculating and gone are the days of waiting for the market to turn to invest the time to invest is now but we only invest in cash flow commercial real estate and that's what our company focused on okay all right so this is the entrepreneur mindset this is the winning mindset if you want to own commercial estate you need to have this mindset you focus on return on investment you focus on the benefit you have a can-do attitude you take off the limits that's how you become successful in this business all right so the last thing i want to do today is i would like to share just in very practical terms what this entrepreneur mindset looks like in terms of commercial real estate what does the entrepreneur mindset look like i'm going to give you two quick examples here's two situations first situation is you found an apartment deal and it can significantly dent your wealth ratio right in fact this one deal can most likely put you out of the rat race okay next is you're short on the down payment sound familiar most of you are like that now you're getting back on your feet right so maybe some credit issues you have some past failures but now you're ready to go and you've been working on your mindset right so a person that is in this situation with the entrepreneurial mindset here's what they're going to do they're going to get help they're going to get a mentor they're not going to try to do do this by themselves it's too risky it takes too long and there's too much at risk actually right next is they're going to evaluate the deal but this time they're going to evaluate the deal with help expert help next they're going to find the money and the credit partner that's what they're going to do next i'm not going to share this video how to do that watch my previous videos on syndication and raising capital and you'll see how this is done lastly they're going to get the deal done a person with an entrepreneur mindset gets things done all right here's situation number two you found a commercial building and once again it can significantly put a dent in your wealth ratio if not take you on a rat rate so it's a significant deal right it can utterly change your life what do you do you have a little bit of money saved up you have good credit so perhaps you have a down payment but guess what you never jumped in this is you you never jumped in for whatever reason it could be fear it could be i don't know but maybe perhaps right now could be the time in your life that you know you need to do something got it the person who's in this situation with the entrepreneur mindset here's what they would do they will get expert help same as this person you start off with getting help don't try to do this by yourself next you would get knowledge the reason why knowledge for this person is really important is because if you don't get knowledge the fear would dominate you and you'll be stuck here you'll never jump in next is you would assemble your team smart right this is very smart to assemble a team again i'm not going to share with you how to simultaneously previous video next is you would jump in an entrepreneur was just with the entrepreneurial mindset is a person that would jump in after you have your expert help you have knowledge and you have routine they're ready to go now let me ask you the question are you a person with a customer mindset or do you have an entrepreneur mindset the key to go from a customer mindset to an entrepreneurial mindset is two things number one is i want you to focus on not the old right but i want you to focus on building the new the second thing once you do is go ahead and watch all of my videos i can almost guarantee you that you watch all my videos your mindset will shift to the entrepreneur mindset because those videos are built for success alright so thank you so much today for joining me i appreciate i value your time thank you so much for watching do you have the right mindset to own commercial real estate if you want more videos like this please go on to our website commercialpropertyadvisors.com or simply subscribe to this youtube channel i'll see you at the next video

Channel: Commercial Property Advisors

Views: 89,913

Keywords: Mindset, Commercial Real Estate, Right Mindset, Peter Harris Real Estate, Commercial Real Estate Investing

Id: biQ900xUVfg

Length: 18min 48sec (1128 seconds)

Published: Tue Jun 20 2017