How to Succeed in Retail Real Estate | Commercial Brokerage Strategies

Paul Voutsas (00:00)
the thing that I love about commercial on the landlord side is that it’s pretty, in retail especially, it’s pretty much a have you read your lease. Because it’s a you problem. It’s not a me problem, it’s a you problem. You took this space for 20 years and you’ve taken full responsibility for everything. like, you’ve got mice, that’s a you issue. You’ve got a leaky roof, that’s a you issue. You’ve got a bad HPAC unit, that’s a you issue. It’s all triple net, which is great for the landlord side.

Kristen Knapp (00:07)
Mmm. Yeah.

Welcome back to the Real Estate Pros podcast. I’m Kristen and I’m here with Paul Voutsas who is the founder of PVIM and it’s a brokerage functioning out of the East coast. So thank you for being here, Paul. Yeah. Let’s start at the beginning. How did you get into this industry?

Paul Voutsas (02:09)
Thanks for having me.

So when I was in college, I was kind of forced into this. My family has some retail properties in Arlington and first they had me do the manual labor they don’t want to pay to do. So they’d have me go fix things like broken windows and broken fences and have me paint restaurants on the outside while I was in college for, know, just like I was playing when I go out to the bars. And then

After that, we had one of our first vacancies in a long time, so they had me help lease that. So we ended up leasing a diner that was called Sieges before to Bob and Edith’s. And then from there, I got my license and I joined a small boutique brokerage in Woodbridge where I was there for three years and then joined another small one for a start of my own. But, you know, always been a retail my whole life and I’ve loved it.

Kristen Knapp (02:57)
Wow, so you just kind of you fell in love with it at a certain point?

Paul Voutsas (03:01)
I

did, I did, because retail is, it’s the more fun side of commercial because it’s all, you know, you get to go try new restaurants, you get to go see new things, it’s more, ⁓ you know, there’s more people involved. It’s not as cut and dry as standard commercial, which is all numbers based, but there’s more people to see and more things to do.

Kristen Knapp (03:19)
That’s fun. Yeah. So how do you kind of scope out properties?

Paul Voutsas (03:23)
⁓ You know the traditional way like co-star loop net to see what’s out there ⁓ Driving by to if I see a sign because there’s there’s not too many owners that are doing their thing their own commercial anymore They’ve kind of realized that it’s hard to to lease something in that unless you’re doing this full-time It’s almost impossible to do a for sale or for lease by owner thing at this point ⁓ And then you know if I see something that’s falling apart. I’ll them a call see they want to sell it, but that’s what I usually do

Kristen Knapp (03:50)
Nice. And then what makes commercial, like what makes it so difficult? What makes it so different?

Paul Voutsas (03:57)
It’s the clients, right? A lot of people want to open a business, but they don’t know they need to have a few hundred thousand just to get the landlord to answer the phone. because like if someone tells me they want to start a restaurant and they say I have a hundred thousand in cash.

I can’t even help them open a five-year square foot restaurant because their bill alone is going to cost about three, four hundred grand. They need to have cash, need to have capital, and they need to be able to get going. ⁓ So that’s kind of what makes it hard. Getting into commercial is very hard as a tenant. And same as a landlord. The properties now are going for, you want to buy a retail center, it’s going to cost you like 10, 12 million at this point. ⁓

Kristen Knapp (04:40)
God. ⁓

Paul Voutsas (04:40)
chest or something small.

Yeah, yeah. Especially in this area. This area is very expensive. So it’s hard to break into. Yeah, so I’m in, I’m in Alexandria, Virginia, my office, which is right outside Washington, DC. ⁓ We are one of the most stable markets in the country in terms of commercial. ⁓ Our rents don’t really drop too low. Our average price for retail square foot is probably in the mid fifties at this point. ⁓

Kristen Knapp (04:47)
Yeah, tell everybody what area you’re in.

Paul Voutsas (05:06)
depending on what you want. Class A retails, I’ve seen as high as the 120 to 130. So it’s a very expensive market.

Kristen Knapp (06:03)
Yeah, yeah. So when you kind of transitioned into, you know, being in real estate, when you actually formed your own brokerage, what was kind of the mindset going into this and, you know, starting your own thing?

Paul Voutsas (06:17)
you know, I had a, I had a good enough backing at a large portfolio in my back pocket that I could, you know, build my brand off of. ⁓ I think we have something like 40,000 square feet of total retail out there. ⁓ and we had four or five vacancies. So we get out there pretty fast in terms of starting my own. ⁓ and so when I did that last year in, I think it was April is when I launched, ⁓

The first deal I did was I took a former bank and turned it into a QSR and leased that way above market. And I just kind of used that to keep building off of. Every time I got, we didn’t want to lease it to the back of the store because there was already six of them that block. So we just wanted to do a restaurant there and it took some time, but we got that done.

Kristen Knapp (07:06)
Yeah, nice. in your line of work, you’re working with lot of investors rather than maybe families and stuff like that. How is that strategy a little bit different and how is your experience different?

Paul Voutsas (07:11)
Yes.

They know what they want and anyone that tells you they know more of their clients is full of it. ⁓ I don’t pretend to be the expert in front of my clients. What they want is what I do because they’ve done this longer than I have and they’ve been doing this for a long time. They know exactly what they want. They know their deal structure. They know everything. It’s just find a deal for them and let them do their research. That’s what commercial is. If you try to educate your clients in this industry, it’s an arrogant thing to do and they’re gonna see it and they’re gonna get pissed off and they’re gonna go somewhere else.

because they just want to, they want you to find their deals and let them do their work. If they have, if they want help, they’ll ask for it. ⁓ That’s kind of the key difference. Like we are, we are, we make term sheets and we save them money on attorneys. That’s what a broker does in commercial. That’s our main thing is to save our clients money.

Kristen Knapp (08:03)
So maybe like a little less emotional.

Paul Voutsas (08:06)
for sure. It’s all numbers. It’s all numbers. And, you know, if there’s not a lot of room for emotion in it. ⁓

Kristen Knapp (08:16)
And I bet that you work with kind of the same people over and over.

Paul Voutsas (08:21)
⁓ Yes, I do for the most part. It’s the same five or six different people that I send my deals to first and you know if they want one of them usually wants a deal if it’s a good deal for the most part if not I’ll just go through CoStar and track down recent buyers and find their info and go down directly.

Kristen Knapp (08:39)
Yeah,

and just in terms of the commercial opportunity in general, talk about just the market and what it’s looking like right now. Because I think there’s a lot of information being thrown out.

Paul Voutsas (08:52)
There is for sure. So there’s a lot more things coming for sale now, especially in our region. think people are starting to kind of feel the effects of Doge, which who knows it’ll be long-term or short-term. That’s kind of, Doge is what kind of, or before Doge we were kind of a session group because there’s so many government jobs here and those have been slashed.

who knows if that’s actually gonna be a permanent thing or a short-term thing, but people are starting to sell things that they wouldn’t consider selling before. ⁓ For example, one of my clients is about to close a building that the owner sold because they lost their government job and they had that property in their family for a long time. So they sold a small little retail property for about four million and…

you know, they’re moving out. So things like that. There’s more investment opportunities right now. In terms of the retail leasing side, which is where I spend most of my time, there’s not that many opportunities out there. If there are, there are at least for the most part. And it’s just now we’re looking for deals in 26 and 27.

Kristen Knapp (10:25)
Yeah, and are you optimistic about the future of it? Yeah. Yeah. Yeah.

Paul Voutsas (10:30)
Of course, as a landlord, I love it. As a broker, it’s great. As a broker, it’s hard. Because, know, waiting

that long for deals to come that might not come is kind of, it can be stressful for sure as a broker. And I get that from young agents that, you know, if they don’t have another source of income, it’s hard to dive into this full time without something to support your checks because everything that can go wrong will in this industry. But the commissions are worth it, right? ⁓

Kristen Knapp (10:54)
great. ⁓

right.

Paul Voutsas (10:58)
Yeah, they’re large and they they’ll sustain. One decent commission will sustain you for whole year. yeah.

Kristen Knapp (11:05)
Yeah, that’s great.

And on the landlord side, mean, it’s kind of interesting the problems you probably have to deal with in your space. It’s just different problems than on the residential side.

Paul Voutsas (11:17)
the thing that I love about commercial on the landlord side is that it’s pretty, in retail especially, it’s pretty much a have you read your lease. Because it’s a you problem. It’s not a me problem, it’s a you problem. You took this space for 20 years and you’ve taken full responsibility for everything. like, you’ve got mice, that’s a you issue. You’ve got a leaky roof, that’s a you issue. You’ve got a bad HPAC unit, that’s a you issue. It’s all triple net, which is great for the landlord side. ⁓

Kristen Knapp (11:25)
Mmm. Yeah.

Paul Voutsas (11:47)
Not as good for the tenant side, but it’s the normal now. It’s the standard and everyone’s doing it. ⁓ So it’s all triple net leases. it’s just, know, and these tenants are still paying, which is good. And they’re still on time. Yeah.

Kristen Knapp (11:52)
Yeah.

Yeah, no, that makes things really easy.

Yeah, you don’t have to deal with you don’t have to deal with graffiti and stuff like that.

Paul Voutsas (12:07)
⁓ I mean, we’ll take care of it. We don’t have to. It’s not our responsibility, but we’ll still take care of it. Because we have two guys on staff full time for maintenance. So things like that we’ll send them around to take care of. ⁓ And it’s, you know, there’s not too many graffiti issues because our stuff is in…

It’s not a part of Arlington where there’s not a lot of graffiti. It’s not a bad part of Arlington. We’ve got stuff in Manassas where there’s a case of graffiti on it, but we get that cleaned up. ⁓ Ulten Alexandria is historic. The worst thing that had happened here was they filmed a fake murder and threw fake blood on the building. And like…

Kristen Knapp (12:32)
Yeah.

What

do mean, like for a movie?

Paul Voutsas (12:47)
Yeah, so apparently, so we bought this building from a local bank called Burton Harvard. It’s their old headquarters. And apparently there was some murder in the 1700s. This is one of the oldest towns in America. And like, these guys were YouTubers and they recreated it every year on the building. So after we had closed on it, I come in my office one day and I see blood on like gravel and teeth. And I’m like.

Kristen Knapp (13:04)
you

Paul Voutsas (13:14)
This looks like someone got killed here. So we called the cops. Cops came out and they’re like, ⁓ you know, it looks like there’s something that happened here, but we don’t know. ⁓ And then two cops are arguing back and forth. One said blood doesn’t dry that color. And so they tested it it was like sugar and cornstarch. anyway, fast forward a year later, I have cameras up this time and I catch them on site doing what they’re doing. they’re just, they’re filming a fake murder. ⁓

Kristen Knapp (13:31)
you

They do

it every year. ⁓

Paul Voutsas (13:45)
Not anymore they won’t, but they’re doing it every year. You can’t throw fake blood on a historic building because the report here is the worst thing to deal with and if you touch a historic building it will make your life a living hell.

Kristen Knapp (13:47)
Yeah, right. Wow, God.

Wow, yeah, I bet there’s a lot of historic buildings like in the DC area.

Paul Voutsas (14:06)
There are

for sure. My office is one of the palm bearers for George Washington lived here apparently. ⁓ So yeah, it’s a very, very historic building.

Kristen Knapp (14:15)
wow. Are there special

rules for that? I imagine there’s like lot of red tape to get around in terms of like in the broken world.

Paul Voutsas (14:22)
There is so much red tape. We have a jewelry

store in the front and if someone smashes the window, I have to go to the review board to get permission to get it replaced.

Kristen Knapp (14:32)
yeah, lot of permission.

Paul Voutsas (14:32)
Yeah, so it’s a lot of red tape.

Same with Georgetown. Georgetown’s super historic and like the same thing. You gotta go through so much red tape just to get things approved. ⁓ So it’s good.

Kristen Knapp (14:38)
Yeah.

And

what constitutes as a historic building? Like, are the specifications?

Paul Voutsas (14:50)
questions, prices, but I have no idea. ⁓ It’s whatever the review board decides, right? Like ⁓ we have a block of restaurants that’s called historic restaurant row, but it’s not actually historic. So who knows? ⁓ I think it’s just, ⁓ I think it’s something that people have too much time on their hands to take care of and call something historic. Old Town’s done a good job with it, keeping it very unique and different.

Kristen Knapp (14:53)
Yeah. Someone just decided. Yeah.

Yeah.

Yeah.

Paul Voutsas (15:59)
But overall, I couldn’t tell you. I’m not a history major. just know that if it’s a sort building, it’s gonna have some issues, it’s gonna be a pain, it’s gonna be fun to deal with. And someone’s gonna make you listen to the talk for three hours about nothing.

Kristen Knapp (16:03)
Yeah.

Right.

Yeah, that’s so funny. So you own your own brokerage, you’re also a landlord. Give us some tips that you’ve learned from starting your businesses. What’s something you wish you learned earlier in your career? ⁓

Paul Voutsas (16:14)
Yeah. Yeah.

⁓ The cost the first thing I wish then someone actually explained the cost of it because you know you sit there you’re like You think it’s only gonna cost this much and then you’re not factoring your insurance You’re not factoring in how much time is gonna take for people to actually take you serious to get a deal And like make sure you have a year reserves before you do it just because it’s gonna take at least a year to get your first deal done ⁓ It definitely takes time make sure you have you know

Kristen Knapp (16:39)
right? ⁓

Right.

Paul Voutsas (16:57)
You’re gonna hit a lot of walls and just keep going. Don’t give up.

Kristen Knapp (17:01)
Yeah, I think that’s good advice because I think people, especially in the real estate business, they see people making such, like so much money and they assume that it’s maybe simple or it should come very easily and that’s not the reality.

Paul Voutsas (17:16)
It’s not all and I think a lot of it’s also BS and glamour ⁓ You know ⁓ My dad was an accountant by trade So I’ve seen a lot of people’s books growing up who were claiming to have X amount of money that didn’t So it’s you know, it’s a lot of glamour and it’s it’s a lifestyle that they choose to maintain But they are all of their eyeballs and dead most of them, you know maintain that fake lifestyle ⁓ you know invest your money wisely and

Kristen Knapp (17:20)
Yeah. ⁓

Yeah.

Paul Voutsas (17:46)
make sure it’s a good deal. Every deal is different.

Kristen Knapp (17:49)
Yeah, and what did that first year look like for you? When was like your kind of your big break where then things started to flow in for you?

Paul Voutsas (17:58)
So I had the listings already from our properties, right? So they were, I pretty much was just taking people that would call in without a broker and just representing them and getting as many deals as I’d done with those as I could as if they were, you know, just trying to turn them in and flip them. So I was, I had a lot of QSRs calling me. So I was, know, I got a few of those working. And then my biggest break was a med spa that I put in one of our buildings in the old town. They’re called the Jura Med Spa and now we are.

Kristen Knapp (18:21)
Hmm.

Paul Voutsas (18:28)
They’re on 10 locations now and we’re expanding to 20. So they were a huge time to get for sure. We just finished Virginia, now we’re expanding to North Carolina. We also wanna go to Kentucky, so that was a good find. And it’s just, you just gotta make sure that you know what you’re doing and that they trust you enough to let you handle their stuff.

Kristen Knapp (18:46)
Yeah, yeah, that’s really all it takes. It’s like one small win or big win. Yeah. ⁓

Paul Voutsas (18:52)
One big tenet is all it takes for sure.

like, know, it helps for sure and it’s fun. So now, next week I gotta go to Charlotte for these guys and then I gotta go to Lexington, Kentucky and travel to Kentucky. So, I’ll be putting some miles on my car for sure.

Kristen Knapp (19:09)
Nice. And how do you, like, you know, in terms of fostering your client base, how do you, what are your tips on just servicing your client base and how you work with people and how to establish trust?

Paul Voutsas (19:20)
Have a good CRM,

follow up all the time, follow up is key, and answer the phone. The one thing that commercial brokers don’t do is answer the phone. They don’t know why, we’re in the sales industry, why they don’t answer the phone. I get it, every phone call costs us money, but answer the phone. You never know who’s gonna have the money to actually buy the deal, who’s gonna have the money to actually lease it. It’s the least person you expect for sure. It’s the least expect. There’s a…

⁓ people would there’s a few there’s a great guy now who’s got a few hundred million in shopping centers

and he would do the work that no one would want. He had a clean company first and grinched large shopping centers from that. like, if you saw him, you think like this guy, you know, he’s driving a Toyota, what’s he doing? Why is he so, like, he can’t afford this. And you look at his books and he’s like, oh, he’s got, you know, a hundred million cash right now just to throw around. So like give everyone a chance. Don’t, don’t judge a book by its cover for sure. And if they’ll, yeah.

Kristen Knapp (20:13)
Yeah.

Yeah, that’s really good advice. think people do that

frequently.

Paul Voutsas (20:23)
for sure,

and if they’re super flashy, then be skeptical. ⁓ That’s why if they’re showing a lot, they’re either brand new money, which is not a bad thing, or they’re trying to pull one over you. That’s that in my experience, yeah.

Kristen Knapp (20:26)
Yeah, exactly.

Right, Yeah.

And yeah, so what’s next for you? What do you see happening in the next few years?

Paul Voutsas (20:45)
⁓

Trying to get a few more shopping centers, so we’re seeing what’s coming available and then

growing the team. I’ve got three agents starting this month and just trying to keep their pipelines full. So any thing I can do to help them grow is for sure the best thing. So I’m investing in lead sources, I’m investing in AI lead generation, I’m investing in, know, like there’s a few things I use. I use TenantBase, which is good because you pay a fee upfront, but they charge you when you close instead of cost per lead, which I like. They charge a percentage of the commission. you know, they’re pretty much, they’re in it for the results.

Apollo AI is also a good one because it’ll help you find the decision makers from the deals, so that’s a really good one to use too and things like that. Yeah.

Kristen Knapp (21:35)
Nice. Awesome. We’ll

tell everyone where to find you.

Paul Voutsas (21:39)
So I’m in Old Alexandria. My office is right next to Market Square and Fairfax Street. you you can find me on my website at www.vimre.com or my phone number is 703-685-0000.

Kristen Knapp (21:54)
Amazing, and he answers the phone. give him a word. Amazing. Well, thank you so much for being here, Paul.

Paul Voutsas (21:56)
I do as the phone, I do as much as I can.

Thanks for having me.

Kristen Knapp (22:05)
Awesome, and thank you everyone for listening and we will see you back next time. Bye. ⁓

Paul Voutsas (22:08)
Thank.