403. Your Buildout Budget Is Off by Six Figures

Check out the free Deal Analyzer: www.tylercauble.com/analyzer

One of the easiest ways I see investors underestimate a deal is the buildout.

In this episode, I’m taking a real 6,000 SF retail property and showing you how I estimate buildout costs using the CRE Central Cost Estimator — then take those numbers directly into the Deal Analyzer to see what happens to my returns.

There’s a 1,500 SF vacant suite in this deal.

If I put another shop into an already-built-out space, I could be looking at roughly $27,000.

If it’s a bare shell, that jumps to around $112,500.

If a restaurant moves in? I could be looking at $262,500

That one decision takes my projected cash-on-cash return from 6.8% to 3.4%.

And here’s the part that matters: my lender is lending on the purchase, not all that additional buildout money.

That cash has to come from somewhere.

I’ll show you the two questions I ask before estimating any vacant space: What’s in there now, and who’s moving in?

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