JF2288: Commercial Real Estate With Tyler Cauble

Tyler is the Founding Principal and President of The Cauble Group, an East Nashville-based commercial real estate brokerage serving the Greater Nashville Area. He’s a native Nashvillian that has not only been a witness to the city’s tremendous growth but is also involved in it through his developments, renovation projects, and volunteer work

Tyler Cauble Real Estate Background:

  • Full-time commercial broker
  • 3 years of investing in commercial real estate
  • Portfolio consisting of 4 office buildings totaling 50,000 sq ft and in 2017-2018 he developed 42 for-sale townhomes
  • Based in Nashville, TN
  • Say hi to him at: https://www.tylercauble.com/ 
  • Best Ever Book: Walkable City

 

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Best Ever Tweet:

“Just get out there and do it” – Tyler Cauble


TRANSCRIPTION

Theo Hicks: Hello Best Ever listeners and welcome to the best real estate investing advice ever show. I’m Theo Hicks and today I’ll be speaking with Tyler Cauble. Tyler, how are you doing today?

Tyler Cauble: Theo, I’m doing well man. Excited to be on the show with you.

Theo Hicks: Awesome. Well, I’m excited as well, and thank you for joining me. Before we begin let’s go over Tyler’s background. So he is a full-time commercial broker with three years of investing experience. His portfolio consists of four office buildings totaling 50,000 square feet, he has also developed 42 townhomes. He is based in Nashville, Tennessee and his website is tylercauble.com. So Tyler, do you mind telling us some more about your background and what you’re focused on today?

Tyler Cauble: Absolutely. I appreciate it, man. So I’m a Nashville native, which nowadays is very rare. Growing up in Nashville, it was a very quiet town; it was night and day compared to how it is now. But I went to college at the University of Tennessee and dropped out after about a year. I didn’t really see the college path for me. I had been in sales for a little bit before that and did really well with it. So I was looking at that, going “Okay, well I can just go ahead and jump into sales or I could spend the next three years in college.” So it made the decision easy for me.

I moved back to Nashville, started working as a project manager for my grandfather’s construction company. I was there for about three months before a developer that I had actually sold to in my previous sales job heard that I was back in town and he recruited me. He basically called me up one day and said “Hey, have you ever thought about getting into commercial real estate? We need an in-house leasing agent to come handle our shopping centers and our office buildings, because we feel like we’re not getting the attention that we need.” And this is back in 2013, the market was very very different back then, it was very slow-moving. The residential side had started picking back up but the commercial side hadn’t. So they wanted someone to come in and manage their properties.

So they paid for me to get my real estate license and I was off to the races. They gave me a 150,000 square foot shopping center to lease, as well as a 57,000 square foot office building in downtown Nashville, and pretty much told me to go find tenants, and we’ll show you how it’s done. So that’s what I did.

I spent a couple of years doing that, stabilized those properties, realized I had worked myself out of a job, and that’s when I started taking on third-party works. Just started doing tenant rep, which means I was representing businesses looking for space. I started doing development as well. The company that I was with, by the time I left, had about a thousand townhomes either under construction in permitting or in planning. So I got to see that first hand and decided to put together my first townhome development deal when I was 25.

So we did 42 units in a little town called Bellevue, it’s about 10 minutes southwest of Nashville. And after I did that, I realized I can kind of do this thing on my own. So I left, started the Cauble Group, wrote a book on how to lease commercial real estate, and haven’t looked back since.

Theo Hicks: Thank you for sharing that, very interesting journey. And I actually was talking to someone earlier about this, I’ll ask you the same question. I kind of already know what the answer is, and that is, how beneficial was your full-time corporate W2, so to speak, job in real estate? How did that benefit your own real estate investing?

Tyler Cauble: Oh, man. It’s the best thing that I could have ever done. When I first got started, I didn’t realize how good I had it, it took me probably a year or two before I realized “Oh, okay…” People don’t really get the opportunity for a developer to pay for their real estate license, to give them that much space, and to learn how to lease from a development perspective. Typically, you have to get work as an asset manager, you got to start off as a property manager, or an analyst, and kind of work your way into that for a few years. And man, it’s impacted everything. It was a nice little boutique farm here in Nashville and they did office, they did retail; we had an industrial portfolio, we were building thousand of townhomes, we had a portfolio of single-family custom homes that we were building as well. So I got to see everything from a zero-risk perspective, which is really nice. So now that I’m on my own I kind of have an idea what I’m doing. And yeah, it gave me a headstart in commercial real estate and development for sure.

Theo Hicks: And did you know at that time that you would ultimately do your own investments, or did that just happen organically, and you like “Well, I got all this information, might as well apply it with my own money instead of applying it somewhere else.”

Tyler Cauble: Right.

Theo Hicks: Is that kind of how it worked?

Tyler Cauble: Yeah.

Theo Hicks: Or did you know going into it, “Hey, my plan is to work for this company, get all this knowledge, and then do it all myself”?

Tyler Cauble: I’ve always been entrepreneurial. I was always trying to find different businesses to start up. I started two when I was in college for that one year that I was there. So when I went into this it was very quickly like, “Okay, how can I start doing this?” And I started trying to put investments together for the team, I started trying to put developments together for the company. I was successful in doing that and partnering with them on those projects, but it very quickly was brought to my attention that “Hey, this is not your show, this is my show. And you’re just here to work for me.” So I was like “I’m kind of doing all the work, I understand how all of this works, it’s time for me to go do it on my own.” So from day one, I don’t know that I was necessarily thinking “Hey, I’m going to learn from here and then go start my own thing”, but over the four and a half years that I was there, it very apparent became that way. And I’m really glad that it did.

Theo Hicks: So for someone who wants to do what you’re doing now, would you recommend that as a starting point, as you mentioned, with zero risk, or do you recommend them doing it on their own from the get-go?

Tyler Cauble: I think it was a great way to get started. When I did it I was 21. There is no way I could have known half of what I know now if I just got out and started doing things on my own, because I learned from so many different people at every step of the way. And I learned it literally from the ground up.

I started off as a commercial real estate leasing broker, but then I was also assisting with the property management, and then because of that I was getting involved in all of the contracts, and so I understood how to read contracts, I understood how to lease, I understood how to handle tenant relations. And we were also developing, so I learned a little bit about construction and how to go about the developing process. So for me, to be able to learn all of that while also getting paid commissions on the real estate side, and getting to have a paycheck without taking all that risk was great. Because if you dive right into it and you just start investing, there’s a lot of nuances of every deal that you probably don’t know and you may not understand because of that. So I think that it definitely gives me an advantage, and I highly recommend starting out that way, especially if you’re younger. Because of the connections that you’ll get starting off at a development firm or a larger commercial brokerage, there are connections and relationships that you may not have otherwise been able to make.

Theo Hicks: That was another question I was going to ask you, too… Aside from the educational piece, how many of the relationships that you developed at this company are now used to benefit your own company? Are you business partners with them? Have they invested in new deals? Are they your customers, or do you now work with anyone from your past life?

Tyler Cauble: Some of the friendships that I made back then, like the commercial brokers and some of the contractors and stuff like that, we’re still friends today. But I kind of went off on a different tangent than what that company did. What they were doing, which I think is great if that’s what you want to do – it was two partners and they self-funded the equity in every deal. So that was the only perspective I had of development, because that was what I was raised in. So these two partners, they had made a lot of money, they took on the debt themselves, they never raised any equity and all they were comfortable with was doing these smaller — I say smaller, but we were building a hundred, two hundred townhomes at a time. But they wanted to focus on townhome projects. Well if you’re going to go do a 340 unit multi-family complex, you’re going to run out of capital doing that very very fast. So I went to this real estate mastermind and learned about syndication. I had never heard about that before and I said “Wow, I didn’t even think about going out raising capital, doing even bigger deals.” So that was kind of the path I ended up taking. So we’ve syndicated some deals, so I learned how to raise equity that way. So yeah, I’ve carried those relationships to a certain extent, but I’ve taken a very different path from kind of what I was raised in.

Theo Hicks: So those office buildings that you own, those were syndicated deals?

Tyler Cauble: Only one of them was, it was a smaller deal. I’ve been fortunate enough, now I’ve been in the business for seven years. We’ve got some high net worth clients that like to provide the equity for our projects. So I typically call two to five guys, they’ll throw in the capital and I’m done. I had never done a syndication before, so I wanted to experience it. So I found a little million dollar office building, and I raised that equity through a syndication just to see what it was like. So that one was syndicated; the other ones I just called a couple of guys and they threw in the equity.

Theo Hicks: So these guys that you called up, these high net worth people, how did you meet them?

Tyler Cauble: So being from Nashville, that gave me a leg up for sure, just on knowing who the players were in town. And then after five years of experience in the industry, people were starting to know me and I started making a name for myself. So every time I had these conversations with them, like “Hey, this is what I’m looking to do. Like I want to start buying this type of product, and here’s what I want to do with it. Would you be interested in throwing money into it?” And of course, the answer is yes. As long as your numbers look like what you’re saying they’re going to look like, we’ll keep throwing money into your deals. So far, that’s how it’s done.

Theo Hicks: So you said you knew who the players were in the town. The guys that had money. So did you call them? Did you email them? Did you show up at their office? How did that original relationship start? You said they knew about you, right? So did they reach out to you?

Tyler Cauble: That’s right. Some of them actually did reach out to me. So I have a fairly strong presence on Instagram, which is so funny to say now, but I actually do get professional football players and professional hockey players on my investment roster, because they follow me on Instagram. When I first got started, my boss at that time, this was four years ago, said “Man, nobody is ever going to buy commercial real estate from you on the internet. This is a relationship game. You’re wasting your time.” And now I’m raising six figures, to seven figures of equity because of Instagram.

So the other ones were people that I had crossed paths with over the years… And yeah, I just call them up and I say “Hey, look. Here’s what I want to do. I want to take you out for drinks, let me take you out for coffee, buy you dinner and just talk to you about what I’m doing and get your opinion on it.” Some of my investors had been guys that were way more established in the syndication game, or in the investment or development game, and I just said “Hey, look. I’ve put this investment together, and I want to get your opinion on it.” And I went and kind of sat down and just said, “What do you think of this offering memorandum? What do you think of my numbers? Do you think that I’m looking at this correctly? What have I forgotten?” And I’ve actually gotten them to invest in those deals that way; it wasn’t intentional, but they looked at it and they said “Well, yeah. I mean, I like this deal. I want to invest with you.” So there’s a number of different ways, but it’s fun, yeah.

Theo Hicks: Well, I definitely want to ask some questions about this Instagram account.

Tyler Cauble: Yeah.

Theo Hicks: Something that we stress here a lot on the podcast is the thought leadership platform, and that would be one example. So how were you able to grow your Instagram followers? What are your tactics for Instagram? What are you posting? How often are you posting? Any other tips you have on that?

Tyler Cauble: Oh, man. We could talk about this for hours, because I kind of nerd out myself and started studying it a few years ago. Basically, what I started doing was showing a behind the scenes of a commercial real estate guy in Nashville. Everybody wants to know what’s going on. That building got torn down in the corner, what’s going on over there? But also Nashville happens to be an “it” city, so people are interested in seeing what’s going on.

I think so many people get it wrong and they post a picture of a property, and it’s just the property and they go “Hey, this space is vacant. You guys can lease it from me.” Or “Hey, I represent [unintelligible [00:14:41].21] I want to work with you guys.” Or “Hey, buy this building from me.” Or “Hey, we’ve got an open house Sunday.” Nobody wants to follow your Instagram account if you’re just going to shove advertising down their throat. So I just said “You know what? I’m hardly ever even going to talk about projects that I have available.” And I do that in the stories, but never on the grid. On the grid it’s all about the relationship, it’s all about who I am. So a lot of my followers just follow me for that. And I’ll post stories about walking through projects and talking about investments and how many investors we have on a deal and how we pulled it off, how we raised the capital, what the tenants were that we decided to put in there. And people just naturally started going “Oh, okay. Well this guy, he’s clearly successful. He’s doing these projects and he’s showing us that he’s doing them. I want to be involved in that.” So people just started reaching out.

But I used to post every day, now I post once or twice a week. I’m very careful about what I post on my grid; you have to do super high-quality photos, you want it to look really good. And that’s what Instagram is at first, it’s all about the image. If you don’t have the best-looking image possible, there’s no point in posting; nobody’s really going to read your caption. So that was a lesson that I learned.

So high-quality images, and then tell a story in the caption. Tell somebody about how you walked through a deal, and you’re having a deal with the framing contractor because they used the wrong stud somewhere, or stuff like that people find interesting, oddly enough. So again, it’s kind of the behind the scenes, not necessarily an advertising platform for me.

Theo Hicks: Alright Tyler, what is your best real estate investing advice ever?

Tyler Cauble: Best investing advice ever is to just get out there and do it. I was afraid of buying buildings until I bought my first one, and then that year I bought four. So get out there and do it.

Theo Hicks: Nice and simple. Alright Tyler, are you ready for the Best Ever lightning round?

Tyler Cauble: Let’s do it.

Theo Hicks: Alright. First, a quick word from our sponsor.

Break: [00:16:27][00:17:08]

Theo Hicks: Okay, Tyler. What is the Best Ever book you’ve recently read?

Tyler Cauble: Walkable City by Jeff Speck. It talks about tactical urbanism and why cities should be walkable and built around people. Hands down the best.

Theo Hicks: if your business were to collapse today, what would you do next?

Tyler Cauble: I’d start it all over again. Start buying more real estate.

Theo Hicks: Can you tell us about the Best Ever deal you’ve done?

Tyler Cauble: Best Ever deal I’ve done was a 28,000 square foot office building in East Nashville, which is where I’m based. I negotiated with the owners, actually; they’re hotel guys, and they happened to buy this office building, they didn’t know what to do with it, so I negotiated with them to come in as the operating partner and to have equity granted to me at certain milestones throughout, so I didn’t actually have to buy it. Best deal I’ve ever done.

Theo Hicks: And on the flip side, do you mind telling us about a time you lost money on a deal? Maybe the most money on a deal? How much you lost and then what lessons you learned?

Tyler Cauble: We actually haven’t lost any money on any of our deals. I’ve got one deal that I think is an okay deal. And it was actually the first deal I ever did. And so far, we’ve about broken even on it. We’ve made a little bit of money. The problem that I had there was I was a little too optimistic about the neighborhood. The neighborhood ended up being a little more backwards than I was hoping it would be. It’s got a lot of younger people moving there, but it’s taking a lot longer than I thought.

Theo Hicks: What is the Best Ever way you like to give back?

Tyler Cauble: Best Ever way I like to give back… I love giving my time and giving advice. Whenever people reach out to me on Instagram, or they want to grab coffee with me and pick my brain about real estate, I love giving back to new real estate guys, because I didn’t really have somebody that was there to really show me the ropes the way that I wish I had. And so I love being that person for other newcomers.

Theo Hicks: I’m going to add in an additional question. What is the Best Ever Instagram post you’ve had? Whether it’s been the most engagements or resulted in the most money raised. Maybe walk us through what the picture was or the video was and what the caption was.

Tyler Cauble: Oh, man. That’s a great question. Best Ever it was like 850 or 900 likes. It was actually here pretty recent. I’m trying to think of which one it was… But I believe I was just talking about my vision for Nashville and the skyline, and how I see the city growing over the next 10, 20, 30 years, and how I love being a part of that. And I think that it was just so genuine and it was a great picture too, and everybody can relate to it.

Theo Hicks: And then lastly, what is the Best Ever place to reach you?

Tyler Cauble: I think you know what I’m going to say, man… It’s Instagram. I will respond to every single DM that I get through Instagram. So you can follow my account, it’s @commercial_in_nashville.

Theo Hicks: So it’s @commercial_in_nashville on Instagram. We got it pulled up right now, and yes, these are very professional pictures. So make sure you check out his Instagram account to get tips on how to grow your business that way. As I mentioned we stressed that relationship platform here a lot.

Tyler, thank you for joining us and providing us with your advice and your Best Ever advice. Some of my biggest takeaways were the benefits of working in real estate as your full-time job before you decide to go and venture off on your own, especially if you catch the real estate bug at a younger age, when you don’t have the knowledge or the money to do a lot of investing yourself. So either in between deals or before you even start doing deals, working at a full-time real estate job can benefit you in regards to education from a zero-risk perspective. So you can learn about whatever you want to learn about with really none of your own skin in the game, and then you can make money at the same time at the job. And then you can also form some connections; for Tyler’s story, he did make some friends, but since the business he was working in was much different than what he was doing, didn’t necessarily work with a lot of those people. But still, depending on what type of job you do decide to pursue, you could benefit from the connections as well.

And then you mentioned that you were able to raise money on Instagram. So you became a well-known person in your local market in Nashville, and had people reaching out to invest in new deals, and you kind of gave us some examples and tips on how to grow your Instagram page, tell a story in the caption, and you realized that the photo is important. If you don’t have a nice photo, no one is going to read your caption anyway.

You used to post daily, now it’s a few times a week. And you said that the wrong thing to do is sort of advertising and what’s better is to go over who you are and what you’re doing, so walking through projects, and things like that. So if you want examples of what to do, make sure you check out his Instagram.

And then your Best Ever advice was to get out there and do it, that you were fearful all the way up until you did your first deal and then from there it was relatively smooth sailing, at least from a fear perspective. So, Tyler, I really enjoyed our conversation. Thank you for joining us today. Best Ever listeners, as always, thank you for listening. Have a Best Ever day and we’ll talk to you tomorrow.

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