Given the level of aggression in the multifamily space in this current market cycle, one may be inclined to start expanding their investment thesis to include alternative asset classes. As the search for the best risk adjusted returns becomes harder and harder, these alternative asset classes could be the answer to finding that next investment opportunity.
Our guest on today’s episode is Neil Wahlgren, military veteran and Chief Operating Officer of MAG Capital Partners, with over two decades of experience in leadership and operations in capital markets. Neil found his investment niche targeting single tenant NNN Industrial lease opportunities. Neil’s basis for identifying this asset type as his preferred investment vehicle was founded on its predictable, long term cash flow model, reduced expense liability, and credit worthiness of the tenant. When it relates to true passive income, NNN leases are simply the most passive form of commercial real estate investing.
Prior to MAG Capital Partners, Mr. Wahlgren led a Bay Area real estate investment firm, raising capital for over $200M in projects. Before that, Mr. Wahlgren piloted the C-130 in both the Air Force and Navy, logging over 2500 flight hours with combat tours to both Iraq and Afghanistan and concluding his military career as a Lieutenant Commander. Mr. Wahlgren resides in San Francisco with his fiancé and son and enjoys flying & sailing. Mr. Wahlgren holds a BS from the Air Force Academy, an MBA from Texas A&M and an MS from Troy University.
In this episode, we cover:
What is the core principle of the single tenant NNN lease space.
What is the difference in the tenant profile vs residential tenants.
What is the typical business strategy when acquiring and managing a NNN lease space.
How do we buy NNN lease assets.
The impact of tenant credit worthiness vs asset location.
Debt financing available for acquiring NNN assets.
Neil addresses each of these informative topics and so much more in this knowledge-packed episode! Tune in today to see if this alternative asset type may be the right fit for your investing thesis!
The Final Four:
1. What do you do for your continued education to further your investing?
Neil: “I’m in CCIM, ultimately a Master’s degree level of underwriting. It’s a bit painful but it’s the nuts and bolts of the operational and fundamental knowledge in the field.”
2. What have been the lasting lessons you've learned along your journey?
Neil: “Specific to real estate, one of the biggest things I’ve learned as an investor and on the GP side is understanding the unknowns of what’s required for your investment to be a success. A lot of people chase returns and projections too much. Invest with operators that look for the unknowns, identify the pitfalls, and have done some operational risk management.”
3. What advice would you give to the listeners to help them grow their businesses?
Neil: “Keep learning and building your network. When you’re looking to place investment capital, use your network to recommend operators in the field that you’re looking in. Find people you trust and that have invested in the space that you’re considering and ask them for their top three operators they’ve worked with."
4. How can they listeners learn more about and connect with you?
Neil: “We have some resources on our website, or you can email me at neil@magcp.com."
Resources mentioned: