October 1, 2025 • 29 mins
A casual chit-chat unfolds as George and Chris dive into the coffee-fueled world of commercial real estate. They kick things off with some light banter about their coffee preferences—George's straight black versus Chris's adventurous mushroom blend, a nod to the quirky side of their industry. From there, George shares his unexpected journey into the realm of real estate, which started as a part-time gig just after college and spiraled into a decades-long career. They explore the nuances of commercial brokerage, touching on everything from retail and office spaces to the importance of being adaptable in an ever-changing market.
George emphasizes the need for real estate agents to stay educated and embrace new technologies—because in the wild world of commercial real estate, it's survival of the fittest, or in their case, the most adaptable! They tackle the question of what truly adds value to a property, with George sharing some killer insights on how strategic upgrades can lead to significant returns. A highlight of the convo is their take on the current market, aptly dubbed the 'fog of war,' reflecting the uncertainty and myriad influences affecting investors today. Chris and George offer a refreshing take on how to navigate the tricky waters of real estate, blending wisdom with a sprinkle of humor.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:44):
Hey George, how are you doing today?
I'm doing well, thank you.
Hope you're doing well aswell, Chris.
I am.
Is that a coffee you'redrinking or.
It is coffee.
It's still 11am where I'm at and.
Well, like most commercialpeople in commercial real estate,
I pretty much drink coffeethroughout the day.
Yeah.
So I come from the commercialand I know that feeling.
(01:06):
So the question we internally,we always joke about with people
in the company is now do youblack cream or cream and sugar?
You know, what's the person's preference?
Yeah, black, straight blackfor me.
Although you know, one of theyounger agents in the office has
got me in the afternoonswitching to a mushroom type coffee
which I'll see out, see ifthat lasts or not.
(01:28):
Okay.
I at one point in time wasdoing the like the, the ones were
like the nitrogen that youcould do almost from like a kegurator
or whatnot.
Nice, man.
That would make the hair onthe back of my neck stand.
It was so caffeinated that I'mlike, I can't do that anymore.
But yeah.
Hey again, thanks for coming on.
Why don't you start outletting people know a little bit
(01:48):
about your story and how yougot into real estate?
Okay.
Well, like a lot of peopleactually kind of fell into it by
accident.
And my story started right outof college.
I had a company that I hadstarted in college and was working
on it, but it was veryseasonal and for a college kid it
was fantastic.
Did allowed me to travelduring college and do some other
(02:12):
stuff.
But you know, I had a rightafter graduating.
It was the wrong or slowseason for that business and I had
some free time.
A friend of mine called me upand said I'm working at this real
estate company and they needsome help.
Are you interested in, youknow, a short term part time gig?
I said sure, why not?
Not doing anything else.
(02:33):
Next thing I know that turnedinto 30 plus years of a career.
You know, they got.
I got offered a permanentposition in two in two weeks there
and determined that it was agood opportunity and wanted to know
more about the industry andkind of just went from there and
grew from there.
Now it's interesting becauselike you said, most of us fall into
this and I was in college, Iwas going for engineering.
(02:55):
And then towards the end ofmy, I think it was like start my
senior year halfway through Irealized, you know, as a civil.
So I'm like, do I really wantto go on design bridges the rest
of my life and then end updoing you know, construction management
and getting in real estate.
And I'm like, man, that glad Idid that change because I would have
been bored just sitting there.
But as you mentioned, most ofus fall into this space with that
(03:18):
kind of falling in.
What kind of commercial, youknow, what does CBI do?
CBI is a full servicecommercial, full service commercial
brokerage company.
Now we do quite a bit of retail.
We do leasing sales, but wealso have office people, industrial
people.
Myself, I still do transactions.
(03:38):
I am a single tenant net lease representative.
Mainly buyers for the most part.
I love finding buyers andhelping them reposition assets on
their investments to achievethe goals that they're trying to
do on their investment goalsand or even life goals sometimes.
And so that's actuallyprobably the funnest part of the
job as opposed to a lot of themanagement and the other stuff.
(04:00):
But we also sponsorsyndications as well as working with
international clients cominginto town into the United States
to expand them throughout theUS we have 27 affiliate offices around
the country.
Okay, so you're not just, youknow, call it the California.
You're basically spread throughout.
(04:20):
Well, we spread throughout.
We have the ability totransact in all 50 states.
I myself, I think I've done 38 states.
I want to retire once I hitall 50.
Of course, surprisingly,Hawaii wasn't that hard, but Alaska
and North Dakota, wow.
Hard to find some goodinvestment properties for a lot of
(04:42):
my clients up in those areas.
So I actually, it's funny youmentioned that too because people
ask us like, you know, withour note business, you know, how
many states?
I'm like 42.
And they're like, wow, youknow, that I'm like, because I want
to get to 50 and I canactually tell you the states, you
know, Alaska, Hawaii, NorthDakota, South Dakota, Oregon, Washington.
And so I can tell you thestates that I haven't been in yet.
(05:06):
And you know, I want to get to.
But like I mentioned, Iactually have somebody for you in
North Dakota who, you know,has got some investments up there
that I could always connectyou with.
So trying to knock one offyour list for you.
You've been around the block,you know, and been around for a long
time.
What's something about yourjourney that is either whether unique,
a learning experience, justshare something with all that vast
(05:30):
knowledge, you know, somethingthat people could take away.
Well, when I first started theindustry, you know, my first thought
was ignorance is bliss.
But ultimately what I'vereally learned from that is, you
know, ignorance was blissinitially in my mind.
But I realized that, you know,it wasn't helping anybody or myself
or my clients and really justthe educational process.
(05:53):
I think that agents that wantto be productive and continue to
be productive and maintaintheir clients and maintain the deal
volume need to actually makeit a part of their journey to be
educated on what's happeningnew in the market.
Whether for instance, youknow, the average commercial real
estate agent is about my ageand they are white and they're male.
(06:17):
That is on average the rightnow who is transacting in commercial
real estate.
The issues that we're findingis that, you know, a lot of them
don't adopt or are afraid toadopt some of the newest things,
whether it's technology,whether it's marketing techniques,
whether it's branding andthings like that or you know, like
to stuff right now is AI.
And so I think that ultimatelythrough the journey and through the
(06:40):
career, what I've learned isthat number one, just like anything
else, when it comes to theworld, the survival of the most adaptable
is going to be the one that'sgoing to end up winning.
So you have to be very adaptable.
And part of that adaptabilityis just understanding where the trends
are going, but also what otherfactors are coming into the industry
(07:01):
that are going to influencehow you do your business in the next
one, two, five years and makeplans to incorporate that in.
You know, whether it's AIavatars, whether it's, you know,
what are you looking to do andhow can that work for me so that
we are leading the pack, so tospeak, or you're the ones trendsetting
and testing out new things.
(07:22):
And that's always been ourcore philosophy behind that.
And when it came to the realestate side, and that's pretty much,
you know, what we looked at.
And really it does adapt quitewell to personal life as well.
You know, I always tellagents, new agents starting off,
if you're going to wait tolearn everything in the market, you'll
never do a deal.
(07:43):
Because after 30 odd years,I'm still learning stuff every day.
No, and that's great advicebecause a lot of special real estate
companies may have been familyor been around for a long time and
I'll use a phrase, old schoolway of doing things and not trying
to adjust.
And I know somebody who hasbeen buying up some certain asset
(08:07):
classes and you know, I thinkthey see value add in ways of implementing
some new technologies likebuilding management systems and really
analyzing where's the moneygoing on utilities and some of these
other expenses and how tomitigate some of those.
And all of a sudden, you know,you got a big building, you bring
your expense, you know,utility and expenses down, you know,
(08:29):
a good chunk.
You know, everything's basedoff a cap rate.
And no I raise, no I goes up.
They just, you know, addedvalue just by implementing some technology
that could have been a, youknow, it could be a $10 million deal
that they put $50,000investment into that just made, you
know, added a million to $2million in that investment.
(08:50):
Absolutely.
You know, I think that's onething that a lot of investors are
starting off, don't reallyunderstand or really how to utilize
the create or rather how tocreate that value.
And you know, for every dollarthat, you know, you just mentioned
the cap rate scenario, but youknow, ultimately what that really
means to any investors, thatfor every dollar that is either saved
(09:12):
or increased on the NOI, thatwill increase the NOI is equivalent
to a 16 to $20 based uponcurrent cap rates valuation on a
property.
You know, and that in itselfis the power of that leverage in
working in it.
So you want to look at whatcan one make you more efficient,
make it a little bit better,or even something as far as like
(09:34):
watching out trending, what'shappening in the trends.
You know, for instance, weused to, I used to do a lot of multifamily
investing and you know,something as simple as dishwashers
may not be as popular thesedays, but you know, washing machines
inside the unit would be fantastic.
So you can take olderbuildings, and there are a couple
(09:54):
of really good companies thatmake a washer dryer that works well
all in one that fits right ina dishwasher.
And they only cost about $1,500.
But, you know, what we do iswe go in there and we say, we'll
remove this dishwasher, butI'll put in a washing machine dryer
set for an extra $50 a month.
(10:16):
Okay?
That increases the value rightthere on that.
You know, $50 a month is $600a year on a cap rate basis.
Multiply that by 15 times atthe low end, 20 times.
You know, that's a $12,000increase for a $1,200 spend.
That's how I look at it oninvestments and also not just on
(10:36):
the investment side, but alsowhen it comes to, you know, with
our agents, like, you know, onthe how can we incorporate that kind
of leverage and, and theability to be able to do stuff, whether
it's utilizing new tools tobecome more efficient or whatever.
So yeah, absolutely agree with you.
Great points.
And that's interesting about.
Again, I agree with you thatyou find more people nowadays, because
(10:58):
a lot of people tend to whoare renting also, I think, spend
more time eating out than theydo actually using it.
And now if you have thewashing, it's probably more.
Washing of clothing isprobably more important than some
of the dishes and stuff.
But.
Yeah, and they're willing topay that extra 50amonth just for
the convenience, not having topick up their clothes and walk down
to the laundromat or the.
(11:20):
Or if your building's largeenough, the laundry room there.
Yep.
Another question I have iskind of more about your philosophies
and if you have a corephilosophy or principles that you
live by and how you treat yourinvestments, your partners, your
clients, you know, if there'sanything there that you like to preach
(11:40):
and speak about, it'd be great.
Well, you know, a couple.
I mean, when you talk aboutclients and things and investment
strategies, probably the coreinvestment strategy is a little bit
different.
But when it comes to ourclients and when it comes to people
that we work with and thingslike that, you know, ultimately,
the way I look at it is, can Iadd value?
Can I help them?
(12:00):
I mean, it kind of goes alongthe lines of the investment strategy
as well as how can I add thatvalue and whatnot.
But at the same time, itreally goes.
Goes back to, you know, theold school mentality of do the right
thing or, you know, I thinkthere was a book that was quite popular
about 20, 25 years ago calledEverything I Ever Needed to Know
I Learned in Kindergarten, andwhich is the golden rule, treat others
(12:24):
like you want to be treated.
And surprisingly, if youfollow that rule, it's amazing how
many other little life issuesdo not pop up.
But, you know, as a reminder,you know, we have a holding company
and, you know, you hadmentioned the coffee, but, you know,
I have a mug here or coffeecup says Pono Asset Manage Management,
that's our holding company.
And Hawaii epono is theHawaiian word for essentially to
(12:47):
do the right thing.
So we're always looking forsocially responsible investing opportunities,
giving back to the communityand things like that.
Now, as an investmentphilosophy, I think one of the ones
that is probably a littleunique and different than most others
out there is that.
And this is what I tell myclients as well.
The reason I bought thisproperty is as an investment.
(13:10):
So I should be looking at itevery year and making sure that it's
performing as good as anyother asset that may be out there,
that's another opportunity.
It doesn't matter whether themarket's down or whether the market's
up or what I paid for thatproperty, because ultimately I'm
looking at the returns.
And so if it makes sense forme to sell that property, even at
a small loss, if I canexchange it into a better property
(13:32):
that's going to give me abetter return, whether it's a cash
flow or appreciation play orwhatever it may be, then that's what
I'm going to do.
I'm not going to wait till I,oh, I can turn a profit of a dollar.
I can sell this.
Now.
Instead, I'm looking at mypersonal investment saying, you know
what, this one's performingwell, but if I sell it and buy this
one, it's going to perform awhole lot better.
My money.
(13:53):
So always take a look at yourassets and what you're working with
and make sure that they'reperforming as well as other opportunities
in the market.
It's interesting because I wastalking to somebody about that, and
I think a lot of investorsmiss that point.
Yeah, and I was speaking tosomebody about, and, you know, I've
(14:14):
worked, you know, many yearsat a W2, and they're working in W2
and stuff.
And I told them, I'm like,your investments are just like a
job.
If you've got a betteropportunity that could come up that
is better for you from whetherpersonal financial, like, you evaluate
one versus the other, and it'slike, okay, do I stick with this
one or do I make the leap?
And of course, now the similarrisks of the one you have, you kind
(14:36):
of know what you're gettingit, you know what's getting involved
and what needs to be done orwhatever case.
And this new asset slash job,you're basing it off of certain information
and certain due diligence you have.
I'm like, it's very similar,you know, it's, you know, that's
how you kind of should look atit, is if you're going to sell an
investment, you know, justdon't sell it to sell it, you know,
(14:57):
just like you just don't movea lateral job just to move.
There's got to be some type ofreason, whether it's the time, you
know, or whatever the case may be.
But also, you got to look atit long term.
And if you're going to take aloss on something, it's still okay
because you're moving tosomething that you can potentially
recoup it and grow where Myconstruction management background.
(15:18):
You know, I used project whenI was project manager.
The hardest projects were theones that were, you know, not only
were they not making a ton ofmoney, but they're most challenging
because contractors got abusiness tough owner.
The ones that went well, thosewere easy.
Learn as much on those.
Of course, there's.
You got to make sure sometimesyou make that shift.
(15:41):
And people, like I mentioned, people.
Yeah, it's a slight, you know,it's keeping your eye on the goal
and what your end goal is.
I think, you know, it's not ainvestments shouldn't be a set it
and forget it type of thingwhere, you know, ultimately when
it comes to the investmentside, especially with us, you know,
I always buy with the intentfor my personal assets.
(16:01):
I should say not.
Not necessarily syndicationsor sponsoring deals, but on personal
assets I'm always buying to hold.
That being said, I'll alwaysat any time sell any one of my properties
if it makes sense to do so.
And I'm always continuallylooking at it.
I mean, I may not actively begoing out and putting the property
on the market unless Idetermine that, hey, here's the opportune
(16:24):
time.
The investment horizon is kindof ending.
For this, this particularinvestment, I need to move on to
something different.
But generally speaking, Imean, the last asset I sold 72 units
in Texas.
We weren't going to sell it.
And somebody came up to us andoffered a substantial increase in
(16:45):
the price versus what we hadpaid for it about seven years previously.
But our intent was actually toredevelop and add some units onto
it.
It was a much larger property.
We figured we could addapproximately 18 additional multifamily
units and create the valuethat way and then go out through
that route.
The offer he put in front ofus essentially had all of our profit.
So I immediately said, yes, Iget my profit, I get my returns and
(17:10):
no risk sold.
And I wasn't going to wait andsay, hey, this is.
I was going to redevelop it.
I wasn't going to say, no, I'mnot going to take this offer because.
And I'm not going to sell ituntil I redevelop it.
It made sense to sell it atthat point.
So we did.
Recently sold a personal assetas well, that we weren't looking
(17:30):
to sell it.
But also in the opportunitycame and somebody reached out and
stuff and now they own theproper next door and they're interested
in this one as well.
And basically it was like,make an offer and then they made
an offer.
And I was like, okay, that'sactually, you know, it wasn't a low
ball investor, you know, typeof offer.
It was like a real offer.
And I'm like, great, let's do it.
Yeah.
And we closed, I think twomonths ago on it.
(17:53):
And it's like, fantastic.
Yeah.
See those are, that's the, Ithink that's how you have to kind
of look at it.
Always be open to theopportunities that may come out,
but you have to vet it out.
And I think that goes withalmost anything in life.
But, you know, if we want tocore down to that philosophy that
you're talking about in general.
Yeah, yeah, we talked a littlebit about people, you know, not making
(18:15):
shifts or whatnot.
What's another area where yousee, I'll call it people who are
newer to the business makemistakes that, you know, you might
be able to help them try andavoid or just that you see a lot
of people making that.
You're just like, oh man, Iwish they would have done something.
Well, a lot of times they lookat, I mean, I think the biggest mistake
(18:37):
for newer investors cominginto it is they, they get focused
on one metric, meaning cap rate.
I need a cap rate that's goingto be 6 and a half percent on this
transaction.
I need a 6 and a half cap.
6 and a half cap.
61 and a half cap.
And even if I put a 6, 4 init, some of those investors won't
even look at it.
But what they're losing sightof is there's reasons why their properties
(19:00):
have higher cap rates.
And when you're looking at aninvestment strategy, an investment
item, I mean, you have to,more importantly than the acquisition,
it's the exit strategy.
How are you going to exit?
What are your assumptions on exiting?
Can I, when I, when the leaseis over, am I going to be able to
exit out of this particularproperty that may have a higher cap
(19:22):
rate, but.
Or are the leases evensustainable when it comes time to
renew those leases?
You know, taking a look at thewhole picture as to why it is and
where it is there, I thinkthat's the biggest mistake that a
lot of newer investors look at.
They just look at, hey, it's acap rate.
So you, you have a lot ofinvestors buying tertiary properties
(19:46):
and markets because they thinkthey have a really strong tenant
base, like a Dollar Generalor, you know, one of the dollar stores,
something along those lines.
And in reality, those rentsmay not be sustainable in that market
when the lease comes due andyou know, they're going to be hurt
down the road, whether it'sfour or five, seven years.
(20:06):
Down the road or the otherthing we've seen in our area is when
you've got those dollargenerals or some of those bigger
blocks in the strip malllocations, you know, if they've got
10,000 square feet, next thingyou know, you're breaking that up
into 3 and 4,000 or 25 footspaces because nobody's leasing that
big a space anymore.
And so that's one.
(20:27):
The other one with cap ratesthat, you know, when I speak to people
about, two is ignore the factthat yeah, it's a great cap rate,
but your roof's only got fiveyears left to it.
You might have to, you know,the, the parking area may have to
get redone or some of the HVAC systems may need to be replaced.
There's other components tothe building that are have significant
(20:49):
capex that, you know, you gotto make sure that you account for
that coming down in the nextfive years, which is going to have
a serious impact on your numbers.
Absolutely.
And you know, a lot of peopledon't take a look at that.
And I think the other, theother one of the biggest connections
or issues that we run into alot of times is that not just the
(21:09):
cap rate issue, but also whatam I going to, you know, how is my
investment performing and notlooking at the whole picture, as
in, you know, not taking intoaccount if I exchange and go into
something larger, I'm going tohave a little bit more tax benefits
and that's actually more cashin my pocket with depreciation, things
like that.
If I can raise the basis oreven potential for bonus depreciation
(21:32):
where, you know, I haveclients, especially with the, you
know, we had properties backin 2017, 18 that were coming online
that were 100% bonus depreciation.
And it was phasing out the newbig beautiful bill that was passed
previously reinstated that.
So there's a lot of propertiesthat are out there and for the right
(21:52):
individual, that works outperfectly for them and can be returned
substantially more.
I mean, I've even haveinvestors that have invested in zero
cash flow properties that orZCFS that the yields are still 11
12%, you know, and it's a safepotential investment depending on
(22:16):
what they're looking to do andhow they're, how their finances look.
So there's a lot of differentopportunities out there, but not
looking at the end goal andfiguring out what exactly you're
trying to accomplish and notletting your broker or agent know
that Then that agent, you'retaking away half the power of that
agent, which is being able toadvise you on what are the best opportunities
(22:41):
for you to achieve those goals.
As we start to enter and wrapup this episode, I do like to do
a quick, I call it lightninground, which nothing ever with me
is lightning because I love to talk.
But if you were in a few wordsto describe the current real estate
market, how would you describe it?
(23:02):
Military term, fog of war.
A lot of stuff going on frommultiple directions and it's really
hard to see what's happening.
And also there's a lot ofoutside influences that haven't really
impacted as if haven't had asbig of an impact as of yet that they
still may.
You know, like, such as the tariffs.
(23:22):
You know, a lot of the tariffissues and spending hasn't even hit
because it really, even thoughthey went into effect back in April,
people were holding back and forth.
And we really started firststarted seeing on the retail side
tariffs starting to takeeffect in sales in June, end of June,
July.
So it's still a little earlythough to really see what, how is
(23:43):
that going to play out?
Is the consumer confidencegoing to come back?
We're also seeing that withacross the board though, there's
a lot of money that's readyand willing to come in and step in
to invest into properties.
It's just that they're not,they're a little bit concerned.
I think there's a lot ofconstruction also that's been slowing
down mainly because the ideasof cost of construction.
(24:07):
Except for certain markets.
I mean, some marketsobviously, you know, New York and
Florida, you know, New Yorkfor the first time since COVID had
a positive, more people in theoffice than they had out of the office.
Meanwhile, you know, other submarkets like Los Angeles, we're still
down 34% from the height ofpeople going into the office pre
(24:30):
Covid than today.
You know, seeing those changesin the market, it's hard to see and
see where it's coming.
But I think we're seeing a lotmore, less gray skies and more blue
skies because I think there'sa lot of opportunity.
It's just that people aren'tsure exactly where to put their money
yet because there's a lot ofstuff that's also going on.
(24:51):
Yep.
No, that's.
I love that fog of war example.
And I think one thing peopleforget about is because everything,
a lot of today's society isbased on everything being so instantaneous
and happening immediately.
And you know, the interestingComponent that is real estate is
(25:14):
like a train and it's like it moves.
But it's, you know, whathappened three or four months ago,
you're finally starting to see today.
And people forget like, yeah,properties are under agreement 45
days ago or what's closing today.
What can happen over 45 daysor even more.
And like you said, even longer.
Tariffs, taxes, interestrates, it takes just.
(25:36):
Because if rates go up or downtoday, you know, that really doesn't
get felt for a little bit moredown the road.
Three or four months.
Yeah, yeah.
Yep.
At a minimum.
Commercial realm.
Yep.
Yeah.
And you look back at 2008,which was, you know, end of late
2008, when layman went under,but really, real estate, I think
the worst peak, I think mayhave been like 2010 maybe.
(25:57):
I mean, it kept going down,but in certain markets, but it wasn't
immediately at that point in time.
Yeah.
You know, I think ultimatelyit's a lot of mindset as well.
I mean, meaning, you know, oneof the things when I do a lot of
training with different agentsand one of the things I've always
mentioned is that, you know,business doesn't stop.
It's not like it's a consumerin the sense that, hey, you know
(26:22):
what, my income's a little bitlower, so I'm going to stop going
out to eat.
I'm going to stop doing this.
I'm going to stop buying things.
Business grows, it keeps going.
Even during downtimes.
There are companies that areexpanding and companies contracting,
which allows opportunity.
So it's more about the adaptability.
Again, going back to that withthe agents being able to see where
(26:43):
the opportunities lie.
You know, whether it's growthin down markets for certain types
of companies or it might bedownsizing for other types, but you
can match those together.
And it's now a win, winsituation that you just created.
And you look like a rock starbecause you just did this during
a down market.
And in reality, it's justidentifying who needs what.
(27:07):
Well, George, thanks forcoming on today.
If people want to reach outand connect with you, what's the
best way for somebody to reach out?
Best way is actually probablyjust via email.
And, you know, it'sgpinobicommercial.com and that's
usually the fastest, easiest,quickest way to get a hold of me.
(27:27):
Great.
Thanks for coming on today andlook forward to speaking with you
in the future.
Thanks for having me, Chris.
Thank you.
Take care.
Thanks.
Bye.
This episode of the PaperTrail podcast, I interview George
Pino with CBI Commercial.
It was a great conversationwhere we dive back.
I got to dive back into someof the old war stories that I used
(27:52):
to deal with in commercialreal estate where George is a commercial
broker, got offices across theUnited States but really shared some
just overall philosophies on investing.
And one that really kind ofhit home is in regards to people
always wondering the next dealand understanding how to get out
(28:13):
of a deal into a new deal.
So we talk a little bit about that.
Talk about the economy.
I love this term fog of war inregards to the type of environment
that the current markets werein right now because of so many external
components impacting real estate.
It really has an impact ofpeople don't know and it's kind of
(28:34):
like you're in a fog justwaiting for it to clear, see, you
know, the dust to settle andsee what happens.
So hope you enjoy this episodethat I did with George Pino of CBI
Commercial.
Hey George, how are you doing today?
I'm doing well, thank you.
Hope you're doing well aswell, Chris.
I am.
Is that a coffee you'redrinking or.
It is coffee.
It's still 11am where I'm at and.
Well, like most commercialpeople in commercial real estate,
I pretty much drink coffeethroughout the day.
Yeah.
So I come from the commercialand I know that feeling.
(01:06):
So the question we internally,we always joke about with people
in the company is now do youblack cream or cream and sugar?
You know, what's the person's preference?
Yeah, black, straight blackfor me.
Although you know, one of theyounger agents in the office has
got me in the afternoonswitching to a mushroom type coffee
which I'll see out, see ifthat lasts or not.
(01:28):
Okay.
I at one point in time wasdoing the like the, the ones were
like the nitrogen that youcould do almost from like a kegurator
or whatnot.
Nice, man.
That would make the hair onthe back of my neck stand.
It was so caffeinated that I'mlike, I can't do that anymore.
But yeah.
Hey again, thanks for coming on.
Why don't you start outletting people know a little bit
(01:48):
about your story and how yougot into real estate?
Okay.
Well, like a lot of peopleactually kind of fell into it by
accident.
And my story started right outof college.
I had a company that I hadstarted in college and was working
on it, but it was veryseasonal and for a college kid it
was fantastic.
Did allowed me to travelduring college and do some other
(02:12):
stuff.
But you know, I had a rightafter graduating.
It was the wrong or slowseason for that business and I had
some free time.
A friend of mine called me upand said I'm working at this real
estate company and they needsome help.
Are you interested in, youknow, a short term part time gig?
I said sure, why not?
Not doing anything else.
(02:33):
Next thing I know that turnedinto 30 plus years of a career.
You know, they got.
I got offered a permanentposition in two in two weeks there
and determined that it was agood opportunity and wanted to know
more about the industry andkind of just went from there and
grew from there.
Now it's interesting becauselike you said, most of us fall into
this and I was in college, Iwas going for engineering.
(02:55):
And then towards the end ofmy, I think it was like start my
senior year halfway through Irealized, you know, as a civil.
So I'm like, do I really wantto go on design bridges the rest
of my life and then end updoing you know, construction management
and getting in real estate.
And I'm like, man, that glad Idid that change because I would have
been bored just sitting there.
But as you mentioned, most ofus fall into this space with that
(03:18):
kind of falling in.
What kind of commercial, youknow, what does CBI do?
CBI is a full servicecommercial, full service commercial
brokerage company.
Now we do quite a bit of retail.
We do leasing sales, but wealso have office people, industrial
people.
Myself, I still do transactions.
(03:38):
I am a single tenant net lease representative.
Mainly buyers for the most part.
I love finding buyers andhelping them reposition assets on
their investments to achievethe goals that they're trying to
do on their investment goalsand or even life goals sometimes.
And so that's actuallyprobably the funnest part of the
job as opposed to a lot of themanagement and the other stuff.
(04:00):
But we also sponsorsyndications as well as working with
international clients cominginto town into the United States
to expand them throughout theUS we have 27 affiliate offices around
the country.
Okay, so you're not just, youknow, call it the California.
You're basically spread throughout.
(04:20):
Well, we spread throughout.
We have the ability totransact in all 50 states.
I myself, I think I've done 38 states.
I want to retire once I hitall 50.
Of course, surprisingly,Hawaii wasn't that hard, but Alaska
and North Dakota, wow.
Hard to find some goodinvestment properties for a lot of
(04:42):
my clients up in those areas.
So I actually, it's funny youmentioned that too because people
ask us like, you know, withour note business, you know, how
many states?
I'm like 42.
And they're like, wow, youknow, that I'm like, because I want
to get to 50 and I canactually tell you the states, you
know, Alaska, Hawaii, NorthDakota, South Dakota, Oregon, Washington.
And so I can tell you thestates that I haven't been in yet.
(05:06):
And you know, I want to get to.
But like I mentioned, Iactually have somebody for you in
North Dakota who, you know,has got some investments up there
that I could always connectyou with.
So trying to knock one offyour list for you.
You've been around the block,you know, and been around for a long
time.
What's something about yourjourney that is either whether unique,
a learning experience, justshare something with all that vast
(05:30):
knowledge, you know, somethingthat people could take away.
Well, when I first started theindustry, you know, my first thought
was ignorance is bliss.
But ultimately what I'vereally learned from that is, you
know, ignorance was blissinitially in my mind.
But I realized that, you know,it wasn't helping anybody or myself
or my clients and really justthe educational process.
(05:53):
I think that agents that wantto be productive and continue to
be productive and maintaintheir clients and maintain the deal
volume need to actually makeit a part of their journey to be
educated on what's happeningnew in the market.
Whether for instance, youknow, the average commercial real
estate agent is about my ageand they are white and they're male.
(06:17):
That is on average the rightnow who is transacting in commercial
real estate.
The issues that we're findingis that, you know, a lot of them
don't adopt or are afraid toadopt some of the newest things,
whether it's technology,whether it's marketing techniques,
whether it's branding andthings like that or you know, like
to stuff right now is AI.
And so I think that ultimatelythrough the journey and through the
(06:40):
career, what I've learned isthat number one, just like anything
else, when it comes to theworld, the survival of the most adaptable
is going to be the one that'sgoing to end up winning.
So you have to be very adaptable.
And part of that adaptabilityis just understanding where the trends
are going, but also what otherfactors are coming into the industry
(07:01):
that are going to influencehow you do your business in the next
one, two, five years and makeplans to incorporate that in.
You know, whether it's AIavatars, whether it's, you know,
what are you looking to do andhow can that work for me so that
we are leading the pack, so tospeak, or you're the ones trendsetting
and testing out new things.
(07:22):
And that's always been ourcore philosophy behind that.
And when it came to the realestate side, and that's pretty much,
you know, what we looked at.
And really it does adapt quitewell to personal life as well.
You know, I always tellagents, new agents starting off,
if you're going to wait tolearn everything in the market, you'll
never do a deal.
(07:43):
Because after 30 odd years,I'm still learning stuff every day.
No, and that's great advicebecause a lot of special real estate
companies may have been familyor been around for a long time and
I'll use a phrase, old schoolway of doing things and not trying
to adjust.
And I know somebody who hasbeen buying up some certain asset
(08:07):
classes and you know, I thinkthey see value add in ways of implementing
some new technologies likebuilding management systems and really
analyzing where's the moneygoing on utilities and some of these
other expenses and how tomitigate some of those.
And all of a sudden, you know,you got a big building, you bring
your expense, you know,utility and expenses down, you know,
(08:29):
a good chunk.
You know, everything's basedoff a cap rate.
And no I raise, no I goes up.
They just, you know, addedvalue just by implementing some technology
that could have been a, youknow, it could be a $10 million deal
that they put $50,000investment into that just made, you
know, added a million to $2million in that investment.
(08:50):
Absolutely.
You know, I think that's onething that a lot of investors are
starting off, don't reallyunderstand or really how to utilize
the create or rather how tocreate that value.
And you know, for every dollarthat, you know, you just mentioned
the cap rate scenario, but youknow, ultimately what that really
means to any investors, thatfor every dollar that is either saved
(09:12):
or increased on the NOI, thatwill increase the NOI is equivalent
to a 16 to $20 based uponcurrent cap rates valuation on a
property.
You know, and that in itselfis the power of that leverage in
working in it.
So you want to look at whatcan one make you more efficient,
make it a little bit better,or even something as far as like
(09:34):
watching out trending, what'shappening in the trends.
You know, for instance, weused to, I used to do a lot of multifamily
investing and you know,something as simple as dishwashers
may not be as popular thesedays, but you know, washing machines
inside the unit would be fantastic.
So you can take olderbuildings, and there are a couple
(09:54):
of really good companies thatmake a washer dryer that works well
all in one that fits right ina dishwasher.
And they only cost about $1,500.
But, you know, what we do iswe go in there and we say, we'll
remove this dishwasher, butI'll put in a washing machine dryer
set for an extra $50 a month.
(10:16):
Okay?
That increases the value rightthere on that.
You know, $50 a month is $600a year on a cap rate basis.
Multiply that by 15 times atthe low end, 20 times.
You know, that's a $12,000increase for a $1,200 spend.
That's how I look at it oninvestments and also not just on
(10:36):
the investment side, but alsowhen it comes to, you know, with
our agents, like, you know, onthe how can we incorporate that kind
of leverage and, and theability to be able to do stuff, whether
it's utilizing new tools tobecome more efficient or whatever.
So yeah, absolutely agree with you.
Great points.
And that's interesting about.
Again, I agree with you thatyou find more people nowadays, because
(10:58):
a lot of people tend to whoare renting also, I think, spend
more time eating out than theydo actually using it.
And now if you have thewashing, it's probably more.
Washing of clothing isprobably more important than some
of the dishes and stuff.
But.
Yeah, and they're willing topay that extra 50amonth just for
the convenience, not having topick up their clothes and walk down
to the laundromat or the.
(11:20):
Or if your building's largeenough, the laundry room there.
Yep.
Another question I have iskind of more about your philosophies
and if you have a corephilosophy or principles that you
live by and how you treat yourinvestments, your partners, your
clients, you know, if there'sanything there that you like to preach
(11:40):
and speak about, it'd be great.
Well, you know, a couple.
I mean, when you talk aboutclients and things and investment
strategies, probably the coreinvestment strategy is a little bit
different.
But when it comes to ourclients and when it comes to people
that we work with and thingslike that, you know, ultimately,
the way I look at it is, can Iadd value?
Can I help them?
(12:00):
I mean, it kind of goes alongthe lines of the investment strategy
as well as how can I add thatvalue and whatnot.
But at the same time, itreally goes.
Goes back to, you know, theold school mentality of do the right
thing or, you know, I thinkthere was a book that was quite popular
about 20, 25 years ago calledEverything I Ever Needed to Know
I Learned in Kindergarten, andwhich is the golden rule, treat others
(12:24):
like you want to be treated.
And surprisingly, if youfollow that rule, it's amazing how
many other little life issuesdo not pop up.
But, you know, as a reminder,you know, we have a holding company
and, you know, you hadmentioned the coffee, but, you know,
I have a mug here or coffeecup says Pono Asset Manage Management,
that's our holding company.
And Hawaii epono is theHawaiian word for essentially to
(12:47):
do the right thing.
So we're always looking forsocially responsible investing opportunities,
giving back to the communityand things like that.
Now, as an investmentphilosophy, I think one of the ones
that is probably a littleunique and different than most others
out there is that.
And this is what I tell myclients as well.
The reason I bought thisproperty is as an investment.
(13:10):
So I should be looking at itevery year and making sure that it's
performing as good as anyother asset that may be out there,
that's another opportunity.
It doesn't matter whether themarket's down or whether the market's
up or what I paid for thatproperty, because ultimately I'm
looking at the returns.
And so if it makes sense forme to sell that property, even at
a small loss, if I canexchange it into a better property
(13:32):
that's going to give me abetter return, whether it's a cash
flow or appreciation play orwhatever it may be, then that's what
I'm going to do.
I'm not going to wait till I,oh, I can turn a profit of a dollar.
I can sell this.
Now.
Instead, I'm looking at mypersonal investment saying, you know
what, this one's performingwell, but if I sell it and buy this
one, it's going to perform awhole lot better.
My money.
(13:53):
So always take a look at yourassets and what you're working with
and make sure that they'reperforming as well as other opportunities
in the market.
It's interesting because I wastalking to somebody about that, and
I think a lot of investorsmiss that point.
Yeah, and I was speaking tosomebody about, and, you know, I've
(14:14):
worked, you know, many yearsat a W2, and they're working in W2
and stuff.
And I told them, I'm like,your investments are just like a
job.
If you've got a betteropportunity that could come up that
is better for you from whetherpersonal financial, like, you evaluate
one versus the other, and it'slike, okay, do I stick with this
one or do I make the leap?
And of course, now the similarrisks of the one you have, you kind
(14:36):
of know what you're gettingit, you know what's getting involved
and what needs to be done orwhatever case.
And this new asset slash job,you're basing it off of certain information
and certain due diligence you have.
I'm like, it's very similar,you know, it's, you know, that's
how you kind of should look atit, is if you're going to sell an
investment, you know, justdon't sell it to sell it, you know,
(14:57):
just like you just don't movea lateral job just to move.
There's got to be some type ofreason, whether it's the time, you
know, or whatever the case may be.
But also, you got to look atit long term.
And if you're going to take aloss on something, it's still okay
because you're moving tosomething that you can potentially
recoup it and grow where Myconstruction management background.
(15:18):
You know, I used project whenI was project manager.
The hardest projects were theones that were, you know, not only
were they not making a ton ofmoney, but they're most challenging
because contractors got abusiness tough owner.
The ones that went well, thosewere easy.
Learn as much on those.
Of course, there's.
You got to make sure sometimesyou make that shift.
(15:41):
And people, like I mentioned, people.
Yeah, it's a slight, you know,it's keeping your eye on the goal
and what your end goal is.
I think, you know, it's not ainvestments shouldn't be a set it
and forget it type of thingwhere, you know, ultimately when
it comes to the investmentside, especially with us, you know,
I always buy with the intentfor my personal assets.
(16:01):
I should say not.
Not necessarily syndicationsor sponsoring deals, but on personal
assets I'm always buying to hold.
That being said, I'll alwaysat any time sell any one of my properties
if it makes sense to do so.
And I'm always continuallylooking at it.
I mean, I may not actively begoing out and putting the property
on the market unless Idetermine that, hey, here's the opportune
(16:24):
time.
The investment horizon is kindof ending.
For this, this particularinvestment, I need to move on to
something different.
But generally speaking, Imean, the last asset I sold 72 units
in Texas.
We weren't going to sell it.
And somebody came up to us andoffered a substantial increase in
(16:45):
the price versus what we hadpaid for it about seven years previously.
But our intent was actually toredevelop and add some units onto
it.
It was a much larger property.
We figured we could addapproximately 18 additional multifamily
units and create the valuethat way and then go out through
that route.
The offer he put in front ofus essentially had all of our profit.
So I immediately said, yes, Iget my profit, I get my returns and
(17:10):
no risk sold.
And I wasn't going to wait andsay, hey, this is.
I was going to redevelop it.
I wasn't going to say, no, I'mnot going to take this offer because.
And I'm not going to sell ituntil I redevelop it.
It made sense to sell it atthat point.
So we did.
Recently sold a personal assetas well, that we weren't looking
(17:30):
to sell it.
But also in the opportunitycame and somebody reached out and
stuff and now they own theproper next door and they're interested
in this one as well.
And basically it was like,make an offer and then they made
an offer.
And I was like, okay, that'sactually, you know, it wasn't a low
ball investor, you know, typeof offer.
It was like a real offer.
And I'm like, great, let's do it.
Yeah.
And we closed, I think twomonths ago on it.
(17:53):
And it's like, fantastic.
Yeah.
See those are, that's the, Ithink that's how you have to kind
of look at it.
Always be open to theopportunities that may come out,
but you have to vet it out.
And I think that goes withalmost anything in life.
But, you know, if we want tocore down to that philosophy that
you're talking about in general.
Yeah, yeah, we talked a littlebit about people, you know, not making
(18:15):
shifts or whatnot.
What's another area where yousee, I'll call it people who are
newer to the business makemistakes that, you know, you might
be able to help them try andavoid or just that you see a lot
of people making that.
You're just like, oh man, Iwish they would have done something.
Well, a lot of times they lookat, I mean, I think the biggest mistake
(18:37):
for newer investors cominginto it is they, they get focused
on one metric, meaning cap rate.
I need a cap rate that's goingto be 6 and a half percent on this
transaction.
I need a 6 and a half cap.
6 and a half cap.
61 and a half cap.
And even if I put a 6, 4 init, some of those investors won't
even look at it.
But what they're losing sightof is there's reasons why their properties
(19:00):
have higher cap rates.
And when you're looking at aninvestment strategy, an investment
item, I mean, you have to,more importantly than the acquisition,
it's the exit strategy.
How are you going to exit?
What are your assumptions on exiting?
Can I, when I, when the leaseis over, am I going to be able to
exit out of this particularproperty that may have a higher cap
(19:22):
rate, but.
Or are the leases evensustainable when it comes time to
renew those leases?
You know, taking a look at thewhole picture as to why it is and
where it is there, I thinkthat's the biggest mistake that a
lot of newer investors look at.
They just look at, hey, it's acap rate.
So you, you have a lot ofinvestors buying tertiary properties
(19:46):
and markets because they thinkthey have a really strong tenant
base, like a Dollar Generalor, you know, one of the dollar stores,
something along those lines.
And in reality, those rentsmay not be sustainable in that market
when the lease comes due andyou know, they're going to be hurt
down the road, whether it'sfour or five, seven years.
(20:06):
Down the road or the otherthing we've seen in our area is when
you've got those dollargenerals or some of those bigger
blocks in the strip malllocations, you know, if they've got
10,000 square feet, next thingyou know, you're breaking that up
into 3 and 4,000 or 25 footspaces because nobody's leasing that
big a space anymore.
And so that's one.
(20:27):
The other one with cap ratesthat, you know, when I speak to people
about, two is ignore the factthat yeah, it's a great cap rate,
but your roof's only got fiveyears left to it.
You might have to, you know,the, the parking area may have to
get redone or some of the HVAC systems may need to be replaced.
There's other components tothe building that are have significant
(20:49):
capex that, you know, you gotto make sure that you account for
that coming down in the nextfive years, which is going to have
a serious impact on your numbers.
Absolutely.
And you know, a lot of peopledon't take a look at that.
And I think the other, theother one of the biggest connections
or issues that we run into alot of times is that not just the
(21:09):
cap rate issue, but also whatam I going to, you know, how is my
investment performing and notlooking at the whole picture, as
in, you know, not taking intoaccount if I exchange and go into
something larger, I'm going tohave a little bit more tax benefits
and that's actually more cashin my pocket with depreciation, things
like that.
If I can raise the basis oreven potential for bonus depreciation
(21:32):
where, you know, I haveclients, especially with the, you
know, we had properties backin 2017, 18 that were coming online
that were 100% bonus depreciation.
And it was phasing out the newbig beautiful bill that was passed
previously reinstated that.
So there's a lot of propertiesthat are out there and for the right
(21:52):
individual, that works outperfectly for them and can be returned
substantially more.
I mean, I've even haveinvestors that have invested in zero
cash flow properties that orZCFS that the yields are still 11
12%, you know, and it's a safepotential investment depending on
(22:16):
what they're looking to do andhow they're, how their finances look.
So there's a lot of differentopportunities out there, but not
looking at the end goal andfiguring out what exactly you're
trying to accomplish and notletting your broker or agent know
that Then that agent, you'retaking away half the power of that
agent, which is being able toadvise you on what are the best opportunities
(22:41):
for you to achieve those goals.
As we start to enter and wrapup this episode, I do like to do
a quick, I call it lightninground, which nothing ever with me
is lightning because I love to talk.
But if you were in a few wordsto describe the current real estate
market, how would you describe it?
(23:02):
Military term, fog of war.
A lot of stuff going on frommultiple directions and it's really
hard to see what's happening.
And also there's a lot ofoutside influences that haven't really
impacted as if haven't had asbig of an impact as of yet that they
still may.
You know, like, such as the tariffs.
(23:22):
You know, a lot of the tariffissues and spending hasn't even hit
because it really, even thoughthey went into effect back in April,
people were holding back and forth.
And we really started firststarted seeing on the retail side
tariffs starting to takeeffect in sales in June, end of June,
July.
So it's still a little earlythough to really see what, how is
(23:43):
that going to play out?
Is the consumer confidencegoing to come back?
We're also seeing that withacross the board though, there's
a lot of money that's readyand willing to come in and step in
to invest into properties.
It's just that they're not,they're a little bit concerned.
I think there's a lot ofconstruction also that's been slowing
down mainly because the ideasof cost of construction.
(24:07):
Except for certain markets.
I mean, some marketsobviously, you know, New York and
Florida, you know, New Yorkfor the first time since COVID had
a positive, more people in theoffice than they had out of the office.
Meanwhile, you know, other submarkets like Los Angeles, we're still
down 34% from the height ofpeople going into the office pre
(24:30):
Covid than today.
You know, seeing those changesin the market, it's hard to see and
see where it's coming.
But I think we're seeing a lotmore, less gray skies and more blue
skies because I think there'sa lot of opportunity.
It's just that people aren'tsure exactly where to put their money
yet because there's a lot ofstuff that's also going on.
(24:51):
Yep.
No, that's.
I love that fog of war example.
And I think one thing peopleforget about is because everything,
a lot of today's society isbased on everything being so instantaneous
and happening immediately.
And you know, the interestingComponent that is real estate is
(25:14):
like a train and it's like it moves.
But it's, you know, whathappened three or four months ago,
you're finally starting to see today.
And people forget like, yeah,properties are under agreement 45
days ago or what's closing today.
What can happen over 45 daysor even more.
And like you said, even longer.
Tariffs, taxes, interestrates, it takes just.
(25:36):
Because if rates go up or downtoday, you know, that really doesn't
get felt for a little bit moredown the road.
Three or four months.
Yeah, yeah.
Yep.
At a minimum.
Commercial realm.
Yep.
Yeah.
And you look back at 2008,which was, you know, end of late
2008, when layman went under,but really, real estate, I think
the worst peak, I think mayhave been like 2010 maybe.
(25:57):
I mean, it kept going down,but in certain markets, but it wasn't
immediately at that point in time.
Yeah.
You know, I think ultimatelyit's a lot of mindset as well.
I mean, meaning, you know, oneof the things when I do a lot of
training with different agentsand one of the things I've always
mentioned is that, you know,business doesn't stop.
It's not like it's a consumerin the sense that, hey, you know
(26:22):
what, my income's a little bitlower, so I'm going to stop going
out to eat.
I'm going to stop doing this.
I'm going to stop buying things.
Business grows, it keeps going.
Even during downtimes.
There are companies that areexpanding and companies contracting,
which allows opportunity.
So it's more about the adaptability.
Again, going back to that withthe agents being able to see where
(26:43):
the opportunities lie.
You know, whether it's growthin down markets for certain types
of companies or it might bedownsizing for other types, but you
can match those together.
And it's now a win, winsituation that you just created.
And you look like a rock starbecause you just did this during
a down market.
And in reality, it's justidentifying who needs what.
(27:07):
Well, George, thanks forcoming on today.
If people want to reach outand connect with you, what's the
best way for somebody to reach out?
Best way is actually probablyjust via email.
And, you know, it'sgpinobicommercial.com and that's
usually the fastest, easiest,quickest way to get a hold of me.
(27:27):
Great.
Thanks for coming on today andlook forward to speaking with you
in the future.
Thanks for having me, Chris.
Thank you.
Take care.
Thanks.
Bye.
This episode of the PaperTrail podcast, I interview George
Pino with CBI Commercial.
It was a great conversationwhere we dive back.
I got to dive back into someof the old war stories that I used
(27:52):
to deal with in commercialreal estate where George is a commercial
broker, got offices across theUnited States but really shared some
just overall philosophies on investing.
And one that really kind ofhit home is in regards to people
always wondering the next dealand understanding how to get out
(28:13):
of a deal into a new deal.
So we talk a little bit about that.
Talk about the economy.
I love this term fog of war inregards to the type of environment
that the current markets werein right now because of so many external
components impacting real estate.
It really has an impact ofpeople don't know and it's kind of
(28:34):
like you're in a fog justwaiting for it to clear, see, you
know, the dust to settle andsee what happens.
So hope you enjoy this episodethat I did with George Pino of CBI
Commercial.
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