How a Warehouse Deal Launched My Commercial Real Estate Career

John Heisler (00:00)
one of the first people that called back was a guy who owned a warehouse said, hey, you mailed me about my house, but I have a warehouse for sale. Do you guys do those?

I was like, sure. I didn’t know anything about it. Drove down there with a generic printed out purchase and sale agreement. Met with the guy. He walked through the warehouse and pointed out a bunch of stuff that I barely understood. And I just kind of nodded and listened. He wanted 500K for it. And it sounded like a decent deal. It was in town Atlanta. And so I got under contract and was like, well, now I got to find somebody that knows what the heck they’re doing.

And then reached out to some local folks in commercial at the time They went through that deal and it ended up turned out being a deal.

Dylan Silver (02:15)
folks, welcome back to the show. Today’s guest is a former intensive care physician’s assistant in the greater Atlanta area who now focuses on commercial real estate deals across multiple different asset classes, including industrial retail office and multifamily sectors. Please welcome John Heisler. John, welcome to the show.

John Heisler (02:38)
Thanks for having me, Dylan. I’m excited.

Dylan Silver (02:40)
It’s great

to have you on, great to have you. And I was just noticing we’ve been getting a lot of investors in the Atlanta area. I think maybe Atlanta is a hotbed of real estate, yeah?

John Heisler (02:52)
It really is. I’ve always heard from friends, Phoenix is the top investor market, but Atlanta is pretty dang close. On the residential side, something like a third of all the houses here owned by investors. It’s a really hot investor market.

Dylan Silver (03:07)
of the locals and people who may not be investors themselves, but maybe raising a family or maybe recent college graduates, so on and so forth, how do they feel about a market that’s very investor heavy?

John Heisler (03:21)
I think they’re just starting to realize it to be honest, but it’s just an awesome city. It’s such a huge sprawling city. There’s something for everybody. There’s a different area for whatever your taste is. You may want the high end suburban lifestyle. You may want the high end in town lifestyle and everything in between. There’s just a ton for everybody. And it’s like 15, 20 counties at this point are part of the Atlanta MSA. So it’s huge.

Dylan Silver (03:48)
Now, I think, you know, with your background, it’s unique. I’ve had a couple people in the medical space ⁓ who either do some type of very passive real estate investing or I had a very interesting story. I had a gentleman who was a surgical dentist. They forget the technical name for it, but he ended up getting vaccine injured and basically got arthritis and could no longer be a dentist, you know, as in the same capacity. So he ended up moving into

John Heisler (04:10)
Hmm.

Dylan Silver (04:16)
medical office space and really helping a lot of dentists and I believe doctors get ⁓ into their own buildings. But I’m curious, how did you get involved in real estate?

John Heisler (04:27)
Yeah, so I kind of looked at it first from the lens of, so I was working in the hospital, I was working extra shifts, I had young kids, I was teaching as an adjunct professor even at the time, and I made a good salary, but I was really trading my time for money is the way, you know, started looking at it more and more. And so I was really looking for some kind of reliable cashflow to come in that didn’t require me to go sit at the hospital.

And at the time I was working nights, weekends, holidays, worked every third Christmas basically and didn’t see my kids. So really kind of wanted a more steady regular schedule and kind of be able to work on my own terms.

So like a lot of folks, you know, heard about real estate investing through bigger pockets and different podcasts like that, bought a couple of rentals and really thought, you know, they were going to change my life.

And I guess they eventually did, but a couple hundred bucks cashflow a month, you know, isn’t really going to change anyone’s life in a meaningful way. ⁓ so then got into it kind of more full time, but I really did both, ⁓ for a long time together would go to appointments and look at houses or commercial buildings, and then go work a shift the next day in the hospital. So doing shift work, I think allowed me to do both together. And then finally just grew it big enough to pull the plug entirely and just do real estate.

Dylan Silver (06:17)
Yeah, I know.

I

want to ask you about ⁓ that balancing act because that’s no easy task, right? And I think a lot of people who may be listening may think, you know, that sounds like a lot of people in the medical field could get very, you know, burnt out. Did you experience or did you see any of that? You mentioned working nights, know, not seeing family and so on and so forth. Is that something that happens in the medical field? Does burnout happen or is it very much prevented these days?

John Heisler (07:05)
⁓ it’s a huge, huge issue in the medical field. You can talk to anybody in any specialty and all the way it’s anybody, whether it’s a nurse, physician, PA, ⁓ every kind of part of the field is experiencing that right now. It’s just, you know, it’s a tough, it’s a tough field to be in for a long time. It really is.

Dylan Silver (07:27)
Now, in the medical path, I’ve spoken with so many different people who are investors, but oftentimes what I’ve seen is it kind of forks off. You have people, and I might put you into this category, where you say, man, how can I get back more of my time? I’m still relatively young, how do I do this? Versus other people who may be career lifelong and then they’re looking at, well, what do I do in retirement? Or I have this nest egg, what do I do?

Was there any kind of pivotal moment for you where either there was an aha or hey this can be my full time or was it kind of a progressive over time you know I’m seeing some some movement here I could potentially do real estate full time

John Heisler (08:08)
Yeah, I think it really was, looking back on it, a gradual change. was, know, I really, you know, being in medicine and being in the ICU in particular was a big part of my identity for a long time. And I was good at it. I liked it. I still miss it to some degree today. So it was a slow change and it took several years. And at some point it was like, this doesn’t have to be a part.

of what I do anymore. don’t have to do this in the same way. And then it just started to make more financial sense to focus full time on real estate investing. There was a period of time where I was considered full time hours in both, just working a ton.

Dylan Silver (08:53)
I can only imagine. I think when a lot of people are listening to this, they’ll be asking, I’m working a job, how do I get started in real estate? Did you have people that were in your immediate circle? We were talking a little bit before the podcast here, bigger pockets, but did you have anybody that was a mentor to you or was it a lot of learning on the fly?

John Heisler (09:15)
Um, it was a little bit of both. think one of the things I’ve always been good at is I’m not afraid to kind of fail forward and try things and see what happens. Like if you don’t have that, uh, it’s really hard to get started in this business, but it was a lot of podcasts and books up front. And I’ve been in several different kind of education programs and masterminds over the years. And each one kind of added a new tool in the toolbox that really helped me get where I’m at today. And then kind of.

connecting with people that are doing the same thing you’re doing, that are maybe a little bit farther ahead that can give you advice on the way, stuff like that’s huge.

Dylan Silver (09:52)
I’m curious what were the pivot points in your business. ⁓ If I recall correctly, started out looking at some creative ways to get involved, wholesale and so on and so forth. Now your focus is commercial and I think a lot of people would

like to get into commercial. I can tell you as a realtor myself, a lot of realtors want to know how to get into commercial. What was the progression like for you and how did you ultimately ⁓ land on and decide on commercial?

John Heisler (10:56)
So ⁓ I knew when I first started buying single family houses, I knew it wasn’t going to be fast enough. So I started sending out mailers to residential houses just to buy them at a deeper discount. And then I thought maybe I’d burrow them, maybe I’d wholesale some, but just get deal flow moving. ⁓ And on that first set of postcards I sent out,

one of the first people that called back was a guy who owned a warehouse said, hey, you mailed me about my house, but I have a warehouse for sale. Do you guys do those?

I was like, sure. I didn’t know anything about it. Drove down there with a generic printed out purchase and sale agreement. Met with the guy. He walked through the warehouse and pointed out a bunch of stuff that I barely understood. And I just kind of nodded and listened. He wanted 500K for it. And it sounded like a decent deal. It was in town Atlanta. And so I got under contract and was like, well, now I got to find somebody that knows what the heck they’re doing.

And then reached out to some local folks in commercial at the time They went through that deal and it ended up turned out being a deal.

So yeah

Dylan Silver (12:04)
I think that deal probably was divine intervention in some way. ⁓ You mentioned warehouse deal, right? Were the next couple of months or years, were you thinking, okay, I’ve got proof of concept in the warehouse, let me expand on this? Or were you dabbling in other asset classes as well and still figuring out what was gonna work?

John Heisler (12:25)
Yeah, I didn’t even though we I kind of got started in that way. I probably never would have done commercial to be honest without that call. So I’m very thankful that guy called. ⁓ But even then, like I didn’t know the secret sauce. Like I just stumbled into that building. ⁓ But then the next one was a referral from somebody. It was an office building. And this was in 2021 in the middle of COVID. Everyone’s stay at home. No one’s working from the office.

and it was an office building, ⁓ we kind of, it was a scary time to get into it, but we had a clear vision of what it could be. ⁓ Single, we started with kind of single room office tenants that had small businesses. ⁓ At the time too though, with ⁓ all the stimulus programs going on, there was a ton of people that needed space for small businesses. So it was actually, oddly enough, a good time to buy that kind of office.

Dylan Silver (12:56)
Yeah.

Yeah.

John Heisler (13:23)
⁓ So we bought that out of foreclosure cord actually ⁓ two buildings and so that was like our first kind of bigger deal. So I’ve always jumped from asset class to asset class. Like if someone puts a good deal in front of me, I’m going to look at it and figure out how to do it for sure.

Dylan Silver (13:28)
Yeah.

Now I’m familiar with single family home foreclosure auctions in Texas. Some people call it Texas Tuesday. Other people call it like super Tuesday. It’s basically the first Tuesday of every month at the County Courthouse steps in whichever County you’re a part of. And typically you look for like a very old looking tall, you know, building with maybe some brick on the outside and you say, okay, that’s going to be where the auction is. very close to it. It’s so dependable. You can go to like any,

John Heisler (13:52)
Mm-hmm.

Dylan Silver (14:10)
Texas city and you’ll see that type of thing or any, you know, the center of the, where the county is. I’m not though familiar with how commercial spaces would be foreclosed on. How did you get into that space? Cause that seems like a very niche area to be investing in.

John Heisler (14:26)
Yeah, we kind of same thing. This one was already bank owned, so we kind of stumbled into it. But there’s a very similar process in Georgia. There’s Super Tuesday. And if you go look at all the addresses that a county will list, some of those will just inevitably commercial be commercial properties. It’s usually only one or two out of the list of, you know, 30, 50, 100 that might be on there. But there’s definitely some commercial ones on there for sure.

Dylan Silver (14:55)
And so when you were getting

were you kind of acutely aware that there were different ways where these deals could be structured or that you would have to buy it at a certain point? Was there a creative aspect to it? Did you have partners? I think a lot of people would say buying at the foreclosure auction is challenging enough, but at the commercial foreclosure auction, there’s even more leverage and risk,

John Heisler (15:45)
you

Yeah, I think what’s cool about commercial is from day one talking to folks that had done it and getting into it myself like there was never the possibility that I was gonna have you know a million dollars liquid at that point to go to foreclosure auction so it was and what’s cool about commercial

is some of the more creative deals that you can do, you can do them in residential as well, they’re almost expected in the commercial space. Like people expect that you’re gonna go get maybe a bank loan and then get some equity investors that bring the capital that work with you, or maybe you’re gonna do a syndication fund or get a hard money loan and pair that with private capital. People are expecting that when you get into the larger numbers of the commercial space. And so it’s kind of more acceptable really, which is cool.

Dylan Silver (16:47)
Now,

I know for the single family homes, and this is a very niche granular question, so maybe give away a little bit of gold, but not the entire bar, right? But for the single family homes, you have to come with basically cash or a check. When you bid on it, do you have money to buy it? There’s no loans. I’m buying this. is the money in my account. With commercial, is it the same type of process, or is there a little bit more leeway as far as financing?

John Heisler (17:14)
In Georgia, it’s the same process. You got to have a cashier’s check. So you potentially need to have a very large cashier’s check on hand, which, but there’s no rules about who brings that, right? So it can definitely be a private capital partner that you’ve got a prearranged JV agreement with, which is what we’ve done before. It’s why a lot of those too will become bank owned. Like they’re just not getting bid on like the single family is. So if you’ve got a $10 million building that’s going to auction.

Dylan Silver (17:26)
Yeah.

John Heisler (17:44)
it’s likely going to get repossessed by the bank and then you can buy it from them afterwards.

Dylan Silver (17:49)
Now, I’m imagining these auctions in 2021. This is a very risky time. would say risky, but to your point, there was a lot of people with the SBA loans, right? And the other types of stimulus that were needing office space and that were looking more remotely. during that time, were you frequently at these auctions or was this something that you were kind of testing out and seeing if it would work? what was the process like? Were you buying multiples of these?

John Heisler (18:18)
No, actually this ended up being for a couple years the only one we did out of foreclosure. We just were right place right time We knew that the two buildings we had seen them. We had seen them sitting there vacant We’re trying to figure out the story behind them realized they were going to foreclosure and kind of swooped in then so kind of deal by deal

Dylan Silver (18:39)
I want to pivot a bit here and ask you about your perspective on the different asset classes, right? Because you’ve taken a look at many you’re involved in commercial right now, but a lot of people will start off in wholesaling or in single family residential, fix and flipping, midterm, know, corporate housing, long-term buy and holds. I’m from Northern New Jersey originally, but we didn’t, I mean, maybe they do now, but I didn’t see lots of people doing short-term rentals really.

ever and I don’t know if they even can. I would have to take a look at it. I’m curious to get your perspective, you know, for folks who may be starting out, is there any advice that you would give folks, you know, or is it really a case by case, a deal by deal basis?

John Heisler (19:10)
Mm-hmm.

I would say the first thing to think about is what kind of tenants do you want to have and manage? And I kind of break them into two buckets. So storage facilities and multifamily facilities, both you’re a B2C. So your tenant is a customer. They’re a regular person. They either are going to live in the apartment or they’re going to rent your storage space. Whereas if you’re on the retail office industrial side, your tenant is a business. So you’re more B2B, which

in a perfect world, I would prefer more of those kinds of clients because once you get that deal done and those tenants are in place, you may have a lot less active management. And so I’m being a deal person who’s just okay at operating. I’d rather have a ton of industrial retail office places.

Dylan Silver (20:09)
Yeah.

I’ve heard kind of a similar ⁓ theme from people who talk about the types of rental properties that they want to have. And a lot of people are saying, well, if you look at storage facilities, RV parks, which is kind of a tangent space to storage facilities, kind of these land plays, especially upscale RV parks, people have told me, you’ll have such minimal tenant issues. I said, really? Upscale RV parks? What’s that? They’re like, well, you get these RV parks. You can even put entertainment, restaurants, facilities.

and people from all over and it’s upscale clientele. They’re going there effectively on vacation. They’re going to have a good time. They’re bringing their RV. They’re just needing a place to park it. said, wow, that’s and then kind of like the red car theory, you know, as soon as that person said that to me, I was seeing them all over the place. RV park, RV park. I said, I didn’t, I didn’t notice this before, but we are coming up on time here, John. Where can folks go if maybe they are in.

John Heisler (20:51)
Mm-hmm.

Mm-hmm.

Dylan Silver (21:10)
the greater Atlanta area and have a deal that they’d like you to look at or if they’d like to get in contact with you in some way.

John Heisler (21:16)
Yeah, yeah. So, ⁓ and I do, I do kind of commercial education coaching, getting people to find their first commercial deal. Almost all of my clients are already investors are doing fix and flip wholesale, single family buy and hold, and they want to get into this commercial space. so that’s the kind of main thing we help folks with. And it’s been super successful. You can reach me at John at CRE-playbook.com or head over to CRE-playbook.com to check out more.

Dylan Silver (21:46)
John, thank you so much for coming on the show here today.

John Heisler (21:49)
Absolutely. Thanks for having me Dylan.