The Modern Man Cave

Good morning! And welcome back CRE Junkies, as we share commercial real estate stories, news, and investing insights.

Here’s what we have for you this week:

• The Modern Man Cave

• 3 Commercial Investments that are still HOT

⬇️ Let’s get into it ⬇️

The Modern Man Cave

We know the wive’s LOVE it when their husbands convert the entire garage into a sports-watchin’, dude-sweatin’ hangout spot!

But some guys must’ve realized that that’s not quite enough space for them.

So many guys have turned to a modern “man cave” trend and developers are beginning to capitalize on the demand.

Woah - so this is way cooler than a garage. But what is it and where is it?

What you’re looking at is the interior of a flex space that is becoming more and more popular.

This flex space is essentially a 1500-2500 SF section of a very large row of warehouses.

It’s got AC, a bathroom, and plenty of space to put all the fun toys that you can’t fit at your home.

These usually rent for somewhere around $1200 - 2000 per month, but sometimes the developer will condo the units and sell them off individually as well.

Then the modern man can use the space to store his hot rods, poker table, light sabers, and everything else a guy could want!

But are developers really building these for just man caves?

Nope! These flex spaces are becoming increasingly popular for several uses including:

• Yoga Studios

• Crossfit Gyms

• Paint or Cabinet shops

• Car storage

And several more use are being discovered for this niche space. Storage units are too small and warehouses are too big.

That makes this size a unique balance to create just what small business owners (and man cave connoisseurs) need.

Just check out some of these man caves ideas!

It might cost you 6 months salary and your marriage, but you’ll definitely have the coolest hangout spot between your friends.

⬇️ Next up ⬇️

3 Commercial Investments that are still HOT

I highlighted in my last newsletter that commercial as a whole has slowed 75% from where it was 2 years ago.

But we’ve uncovered 3 commercial investment types that are still viable even in this high interest rate market.

Flex Space. This should come at no surprise since we just discussed the modern man caves and other uses. Flex Space is some of the most versatile commercial property you can build.

And a lot of time these opportunities aren’t even ground up construction, but conversions from old warehouse buildings or even old fire houses.

Local businesses depend on these types of space so investors have responded accordingly.

They cashflow and have much lower capital costs than larger warehouse investments.

This asset type is fragmented and perfect for a newer investor to get their feet wet.

Industrial. This is the big brother of the flex spaces we just discussed.

Industrial real estate was the top performing asset class in 2023. Now in 2024, growth has slowed a bit but that’s mostly due to high construction costs but still remains strong.

There’s still plenty of demand for businesses like Amazon and other E-commerce based stores.

And given high construction costs, Investors are mostly focused on finding under performing assets and revitalizing them.

This is definitely more of an institutional level investment grade option, but should be noted as we continue to see that massive blocks popping up anywhere there’s flat land.

Boat & RV Storage. The demand for Boat & RV storage continues to rise even through market fluctuations.

Investors are flocking to this asset classes given it doesn’t require intense capital improvements and demand is still rising for RVs and other recreational vehicles.

And with work from home being more common for Millennials and Gen Z workers, and anywhere internet access through StarLink exists - Living the RV life is becoming a very attractive option!

Just pull the power, add plumbing, pour some concrete slabs and you’re good to go!

Bonus points if there’s a pond.