Investing in Massachusetts commercial real estate can be one of the most fulfilling business ventures out there. It offers a tangible alternative to the often “abstract” money market.
The historic Commonwealth of Massachusetts is no exception. It boasts stunning old-world buildings alongside state-of-the art new construction. The Bay State provides investors some unique opportunities.
Finding success in Massachusetts commercial real estate does not come without its challenges. New listings that make sense can be hard to come by.
Finding that perfect deal proves to be the most frustrating part of the business.
What most people don’t know is that there are some tried and true best practices for investment strategy which you can implement.
The reality is, if you are not employing the right game plan, you are already behind the competition. Posting once or twice a quarter and phoning up an agent occasionally isn’t going to cut it and allow you to get that deal.
You can find the next big deal in Massachusetts commercial real estate.
To beat the competition, you need to do more.
Quietly declaring your intentions once is not a good investment strategy.
Are you like so many investors feeling defeated when you can’t find a deal?
It may be time to broadcast your search to Plymouth Rock and back and keep at it.
The best Massachusetts commercial real estate investors ring their network all day long. They maintain a constant line of communication with brokers, operators, and even developers. If that sounds like a lot of work, you’re right, it is!
A trusted brokerage can help you find that deal at no cost to you. Brokerage firms are paid by the seller. So, if you’re a buyer, it’s worth taking advantage of this complimentary service.
Actively telling people that you’re in the market to buy ensures that your goal does not fall on deaf ears.
In this industry, it never hurts to ask and show interest in more than one investment opportunity.
Now, is finding that amazing deal simply? No, but time and again, the hidden gems in Massachusetts commercial real estate are overlooked. So, get ready to turn over every stone!
Say a property has been up on LoopNet for a year and a half, and nobody seems to be interested. Real estate is all about the negotiations so this doesn’t mean the perfect deal can’t be made.
In a state with two million buildings, properties that align with your price point may be scarce. Here are some of the best ways to find hidden gems in Massachusetts commercial real estate.
1. Massachusetts Commercial Real Estate Brokers
Working with a commercial broker is highly recommended when pursuing CRE.
Here is why:
- They’re already practicing most of these methods.
- Brokers have a holistic understanding of the Massachusetts commercial real estate markets where they do business.
- In most cases the seller pays for the brokers services, making this service free to you.
- Brokers have expansive networks that you can leverage to save time and money. With brokerages handling multiple transactions for individual clients a year, their skill set for negotiations, transaction management, and doing the due diligence is fine-tuned.
Brokers have developed skills to find current and upcoming opportunities that mean your needs and goals. And they don’t get paid until the stars align so they have every reason to work hard to find that perfect opportunity. They aim to complete a successful round of matchmaking between buyer and seller.
2. Take Advantage of social media
In this age of information, social media is the foundation.
Massachusetts commercial real estate is no exception. Don’t be discouraged by the likes and follower count. Think of social media as a digital billboard that everyone can write on.
How can you tell everyone you know that’s you looking for that perfect Massachusetts commercial real estate investment?
Consider posting your goal on your profile. A more advanced social media user will also consider sharing on other pages. You can even comment in other groups.
Which real estate group are good to join? Spend some time scoping out which groups make the most sense for your goals and submit your request to join. Social media groups are a great way to find hundreds or thousands of people you share a common interest with.
Be sure to follow your local brokerages doing business in the area you want to buy in. Brokers post listings regularly to their social media accounts.
Facebook and LinkedIn both have this useful feature.
3. Cold Calling
Is cold calling a thing of the past, an outdated tactic for the 21st century? Not at all.
This is one of the most immediate and foolproof routes to get ahold of a property owner. One obstacle with this tactic is obtaining a property owner number in the first place. Another is simply the heart-stopping experience that some people have when cold calling is mentioned. If this method isn’t for you, consider working with a broker.
If you choose to put the time in calling owners for hours, here are few suggestions:
- Search their website for their contact information. They are usually listed under the contact or about sections.
- Try connecting with them on LinkedIn. Sometimes phone numbers are revealed after they accept your request to connect.
- Once you have their number, be direct. They most likely won’t be taken aback if you ask if their property is for sale. They hear it all the time and aren’t interested in the small talk.
- Just because they aren’t ready to now, doesn’t mean they won’t be in six months or a year from now. Ask them to save your number for a rainy day.
- Always circle back at least once per quarter.
Sound like a lot of work? Brokers use this tactic all day long and you can leverage their experience and network by starting a relationship with a brokerage.
4. Send a Letter
Speaking of archaic communication, have you ever considered sending a letter? Most property investors have not; now is your time to shine.
This method will put you right in front of the eyes of your prospect without the noise. Physical mail has become a relic of the past ever since email hit the scene more than twenty years ago. With the convenience of this communication tool came oversaturation.
Check your inbox lately? Your seller has the same problem too. Mailing them today is thinking outside of the inbox.
5. Scope Out the Area
Sometimes, you need to get out there and make it happen.
If you live close to the area you invest in and have the free time, try making a habit out of weekly drives through your target neighborhood. Take note of which properties are a little run down. These properties often present rewarding value-add opportunities.
The current owner may have let their property go over the years because they aren’t able to maintain it. Take advantage of this. See if you can meet them and strike up a conversation or circle back using one of the other methods.
Doing this often will help you gain a better understanding of the locality. You will also realize where the hotspots are in town.
You could also scope out the neighboring country or town to compare. Doing this will give you a more nuanced understanding of Massachusetts commercial real estate. For more information on market trends for real estate investing, check out our recent blog post.
Whether you’re using a broker or not we recommend you research any area that you are thinking of investing in.
6. Qualified Opportunity Zones
Sometimes opportunity is in the name. Qualified Opportunity Zones are economically challenged areas where new investments may be eligible for preferential tax treatment under certain conditions. The IRS established requirements for these qualities, which were incorporated into the tax code as part of the Tax Cuts and Jobs Act of 2017.
These low-income areas can be found in all 50 states, as well as the District of Columbia and five US territories. Communities can be designated by states and territories. The nominations are reviewed and certified by the US Department of the Treasury.
Because of the tax incentives, these areas are extremely attractive to new investors. Perhaps the most intriguing perhaps is the complete lack of tax on property appreciation. If you are willing to invest in your gem, this method might be for you.
Check our recent blog post for more information on Qualified Opportunity Zones.
7. Online Research
Be sure to check online databases such as LoopNet, Crexi, and brokerage websites often.
It may seem obvious, but you could miss an opportunity if you don’t frequent these sites enough. Properties move fast, especially in a state like Massachusetts.
To find that special property, try to be more specific with your searches and filters. It will help you weed out properties that don’t align with your goals.
Be sure to turn over every stone. Great deals may be disguised under poorly written listings.
Make no mistake about it; finding gems in Massachusetts commercial real estate takes a balance of skills. Among the most useful are patience and consistency.
You must be willing to go out of your way to do the research, make the connections, and be assertive enough to let everyone know your goal loud and clear.
At any given moment, there may only be a handful of listings that meet your qualifications. Keep your ear to the ground and connect with your local broker to ensure your best chance at success. Good luck, happy buying!