Juan Juan Salon in Brentwood, CA with Joe Killinger

Guest: Joe Killinger
Topics: Juan Juan Salon, brokerage

Transcript:

Chris Ressa 0:00
This is retail retold the story of how that store ended up in your neighborhood. I’m your host, Chris ReSSA. And I invite you to join my conversation with some of the retail industry’s biggest influencers. This podcast is brought to you by DLC management. Welcome to retail retold everyone today I am joined by Joe kill injure. He is a partner at commercial brokers International. He is the host of a YouTube show called Real Estate jam session. I’m excited for him to be here. Welcome to the show.

Joe Killinger 0:34
Thank you. Thank you for getting my last name right. It’s been clinger. It’s been calling or it’s been so well done. Thank you.

Ressa 0:43
I get Risa all the time I used to when I was growing up wrestling. And they were denature named get on. Yeah on mat on the mat. They would say cursory sounds like this is petitioning to us. It’s not to meet.

Killinger 0:57
But that is my favorite candy right now in our office Reese’s. little cups are in the freezer in the office. So that was an espresso in the afternoon. Best pick me up ever.

Ressa 1:06
Freezer. That’s good milk in the freezer.

Killinger 1:09
Yeah. It’s a little slice of heaven in the middle afternoon.

Ressa 1:13
I like that. Yeah. Joe, tell us a little bit about who you are and what you do.

Killinger 1:19
Absolutely. I’m a partner of commercial brokers International in Los Angeles. So we’re a smaller boutique commercial real estate firm. We are full service. We got 14 agents. And you know, we do deals around Los Angeles. But we also done deals in 36 states. So far, a lot of STL deals. And then we also have a YouTube channel, that called Real Estate jam session that we put content out twice a week, which by the way, your video will be out here in the next couple of weeks. Great job. I was looking at the heading you did very well at but we put this content out in real estate to really help those that want to become a real estate investor or real estate agents. So that’s what real estate jam session is. The logo behind me.

Ressa 2:03
Got it. So most of the deals you’ve done in other states have been single tenant Net Lease deals on the investment sales side. Yeah, exactly. And what do you guys consider your bread and butter in Los Angeles?

Killinger 2:19
We do. I mean, I wish I could say investment sales, but I mean, we’ve got more buyers than we know what to do with for industrial and multifamily but right now it’s been mostly retail and office leasing.

Ressa 2:33
Okay. Well, and the buyers interested in industrial and multifamily. Are they local Los Angeles? Oh investors, are they

Killinger 2:44
it’s it’s mixed. We’ve

Ressa 2:46
got a bunch of funds, private equity groups, what

Killinger 2:48
is it? We’ve got? Yeah, we’ve got everything from mom and pops that have done very well in the stock market the last couple of years to some institutional big money and finding them inventories is pretty, pretty difficult, but it’s mostly California based people. We’ve got a couple of New York institutions but not as many.

Ressa 3:07
Got it. Okay. Joe, I have three questions for you. Call this section clear the air. Are you ready?

Killinger 3:18
Probably not. But let’s try. All right.

Ressa 3:21
Question one. Yeah, this last time you tried something for the first time?

Killinger 3:25
Oh, just a couple of weeks ago now. And I need to caveat here I am. rotator cuff issues. But in indoor wall climbing. I may be mining addiction. That is the most fun. It was I got to really focus on this rehab this shoulder. But once I get that done, I think that’s going to be a new passion. That’s something everybody should try. Wow. Yeah. That’s a good one.

Ressa 3:53
That is a good one. I need to try to have it. I mean, I’ve like played it. I haven’t really done it. So I tend to do that. That’s a fun one.

Killinger 4:00
Yeah, this is it’s uh, I don’t know how this wall was like 20 some feet tall and went up and you come down but man, I can really feel it cuz it’s a full body workout legs, your fingers. You’d be surprised forearms about your shoulders. It puts a pretty good bind on him and some of the reaching that you do. So it’s a little slow and weak but so is a little nervous to really push too hard.

Ressa 4:24
I’m not great with heights. Yeah, so that would be that.

Killinger 4:29
I’m harvested and then they put me with this little kid that’s maybe 12 She like little spider going up the wall. I’m like, Oh, seriously, this is what I need. Oh, I had to try and catch up at least.

Ressa 4:41
Well, I’m sure you did. Great. Okay,

Killinger 4:43
I don’t know. I’ll do better later.

Ressa 4:46
How often do you think you’ll do it?

Killinger 4:49
As much as I can. It’s it’s pretty it’s catching on that we don’t have a lot of places. I think ideally, I would like to go try some real rock climbing Maybe Utah or someplace, but I do have a little bit of a fear of heights. I don’t know how much of that I can really do. But it’s it’s a dream. We’ll see how it goes.

Ressa 5:10
Okay. All right. Question two. Yeah. What is one skill you don’t possess but wish you did.

Killinger 5:19
This is kind of an easy one. Because growing up is playing a piano. I really I have no musical. Nothing that I just can’t. And but my sister, both my sisters were very good at it. And I’d always the song Music Box dancer on the piano when I was a kid. For some reason. I just love that song. And they’d sit and play it for me. And yeah, so playing the piano would be what I’d love.

Ressa 5:46
That would be amazing. I’d love to be able to just go. Yeah, wouldn’t that be time they’ll be totally moved. And

Killinger 5:53
yeah, everybody’s like, yeah, it’s not gonna happen.

Ressa 5:57
Not for me, either. Okay, last question. Yeah. What is one thing most people agree with? But you do not?

Killinger 6:04
Oh, this is interesting, because I got into this conversation just yesterday. And I’m with a bunch of commercial real estate agents. And I made the comment, you talk to a lot of people that they invest in Airbnb, right, and they’re around the Midwest. And I said, don’t you think that that’s going to start taking a hit with gas prices? Inflation? And, you know, I could see where it would stay strong and tourist places, you know, along the coast, or around Disneyland or universal or someplace like that. And they all thought they didn’t think so. So I think it maybe I’m wrong here. But I kind of think those asset classes might see a slowdown. And that’s something that really yesterday, I thought more people might agree with me, but turns out not

Ressa 6:52
interesting. I think it comes down to what are what is human behavior? inflationary types? Yeah. So it last quarter. When Burlington stores reported, the CEO said that they’ve historically done well, in inflationary times, because people trade down and create value, the other one deals. And, and recently, I’ve seen I’ve seen articles about Walmart and other retailers who have talked about that they typically do good and inflationary times. To me, it comes down to what two things one, do people trade down? Which I think there is a segment of the market who does a large I think it’s a large American population trades down there, the other people that you know, so that’s the MORE BURGERS less steak. Yeah. There’s the other who groups who just buy less. Right? They just spend, I’m not going to buy X anymore. Yeah. And then there’s the groups that are like, Well, I gotta pay 15% More, it’s just is what it is, but I’m still spending, right. And what I, what I think my take on the Airbnb, is, I’d love to know more about who their customer is. Yeah, like if there was a demographic pool? Because if you’re a frequent Airbnb, consumer, like your frequent Airbnb consumer, I would assume you’re less price sensitive. But I don’t know if that’s true.

Killinger 8:59
I don’t either I just, you know, I can see like, the I was talking. He has a Airbnb,

Ressa 9:05
like, if I’m somebody, right, if I’m somebody who, you know, once every 60 days, I want to take my family to a cabin away somewhere. I would, you know, that’s typically and they’re typically not going to an inexpensive cabin, right. I don’t know how price sensitive that customers.

Killinger 9:28
I don’t know. But I don’t know what the size of that market is. It’s just, you know, I’ve got a guy up and he has a place right above the whiskey on Sunset in Hollywood. And he’s seen a little bit of a slowdown the last few weeks, and he doesn’t really have amenities with it. And so it’s really kind of a unique place anyway, but I mean,

Ressa 9:50
maybe maybe that’s the American consumer. But again, you know, I wonder who is his who was his normal customer

Killinger 10:00
Yeah, it’s young people that want to be up and down the Sunset Strip the whiskey. True, but all that. And so that’s a board price sensitive group. Yeah. Yeah,

Ressa 10:09
that’s a more price sensitive area. It’s more price sensitive group. You know, I think, you know, are you going on vacation this year?

Killinger 10:21
i Yes, I will. I go back to I’m from Nebraska, and I always take go home and Christmas. Now I always go to the hometown rodeo. So that’s always a lot of fun to go back. And it’s a small town town of 281. People. Okay, so the dating pool is pretty shallow in high school, as you can imagine. And so I love going back there. And it’s just really, it’s, you know, you it’s just true downtime, right? So yeah, but I’ll probably go scuba diving someplace, too. I’m not sure where.

Ressa 10:55
All right, you’re will price play a factor if you go scuba diving or not? Or will it just be time?

Killinger 11:04
It’ll be a little bit of both. I mean, it just depends on you definitely be a little bit about, I mean, what hotels are gonna be like, by the end of summer? And but it depends on the experience, too, right? It just depends on it’s really great diving, then, you know, obviously willing to pay more for that.

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Ressa 12:09
So you have a story for us about a hair salon. Yeah. I have a couple take it away.

Killinger 12:15
I get you know, there’s a hair salon and I was new. I was new to commercial real estate.

Ressa 12:20
And it takes us back time period when it’s new for commercial real estate.

Killinger 12:23
Oh, for me. I’ve been in 20 some years. So we’re in the late 90s. Early two that no this this would have been mid 90s I was doing auctions before I was doing real estate auctions before.

Ressa 12:35
So were you bringing me back to the mid 90s Here we aren’t in the 90s yet.

Killinger 12:39
And I get this call this clients referring it this person was you want you want salon in Beverly Hills. I’m like never heard of it. Well, I you know, 200 bucks for a haircut. Not probably not gonna happen. That’s why I never heard it. Right. So, so I go in and meet it was so intimidating. I mean, I walk in and everybody is like a supermodel that work there. And the guys that work there were just, you know, perfectly quaffed in every way possible.

Ressa 13:06
You’re handsome guy.

Killinger 13:07
Yeah. So I walk in, I’m like, Oh, my God, I’m so freaking intimidated. And then under comes out. Of course, he’s stunning. And actually, I’ve got to interview with her son today. Yeah, so. So I’m like, Okay, stay focused, you know, what do you want? I wasn’t even really sure the questions to ask. And so I sit down, I interview them. I’m driving back to the office. They want to go from their second location. They want to go from Beverly Hills. They want another place in Brentwood on Sam Asendia main drag, which is right across, right where my office was. And so I do the interim, they’re trying to figure out what the I’m just writing everything down because we weren’t really sure how to really qualify these people. And I’m driving back and there was an old gap on Sandy, Sandy Boulevard, they’re taking the sign down. So I want to pull over as a maintenance guy. Is this going on the market? He goes, I don’t know. I said, Well, how do I get ahold of the owner? And so I went in. And I mean, it was just that day, I found them the space. Yeah, and negotiated it all out. And but it was a scary. I mean, the anxiety I had doing all that when I was just learning the business. I didn’t really back then it was tough to find a mentor. And I was in I’ve been running an auction company before. And so transitioning to commercial real estate, there was really nobody in the office that had done commercial real estate. So

Ressa 14:37
So take me back for a second. Yeah. So you go in, you meet with the owner, you’re intimidated, and what they’re telling you they want to open up another location. And so, yeah, so what are they asking you to do? Or at this point? Are they asking you to work on their behalf? Or are they interviewing you to see if they should work? worked

Killinger 15:00
with you. Yeah, they were interviewing me to see if they could work with me. And all I could think about, as I’m bumbling through this interview with them, it’s like, they must think I’m the biggest idiot. This is what’s going through my mind, right? Because I didn’t really know what to ask. You know, so I’m stumbling through it. But you know, I knew enough to ask for their financial, you know, all that financial. So I get when a client or a landlord was ready to go, they would have everything in place. So I knew what to really ask for. It turned out I just wasn’t sure I was asking the right questions, but it was just so damn did.

Ressa 15:29
And when you left there, did you think you are authorized to proceed to work? Did they give you the Oh,

Killinger 15:39
no, the assumptive close. was like, Yeah, whatever. We’ll try and figure this out. You know, male ego. It’s a very fragile thing, right? But male ego, I had it in the bag. And so when I saw this driving by this property, I’m like, I know this property, because it’s maybe 20 yards from my office. I go, it’s perfect. And so

Ressa 15:58
you see the maintenance guy taking down the site? Yeah. Yeah, I used to be you said, you met with the owner. Did you walk

Killinger 16:03
in? Yeah. Yeah, he was coming by in about 20 minutes, I wouldn’t dump everything off of the office, came back. He was there. And I said, Listen, I’ve got this client. And I was so great. I just told him who it was. I didn’t know any better, right? So yes, George, you want out of Beverly Hills? He goes, Well, I just need to see their financials, because we’re just putting it on the market. I said, Well, I can save you a lot of time. And it was very lucky in this Chris, they actually knew people that were they were all very close. You know, they’re both Beverly Hills families. And so the connection was there. So there’s a lot of luck in this.

Ressa 16:36
So okay, so you met? Yeah, I mean, what are the odds you meet with the owner? Yeah. An hour after you met with the client? Yeah, that’s, that’s obviously yeah. You know, pretty fortuitous. You must have thought, oh, this business is easy. Yeah,

Killinger 16:51
exactly. My first investment, you know, the first multifamily investment I bought for 275. And, you know, ended up selling it a couple years later for, like, 1.3. But now my second one was a three story walk up, it just went to shit. You know, I think it’s my ego was in my head, because I did hit a homerun on the first deal, right?

Ressa 17:12
So Juwan Jawan. So, you you meet with the owner, and wants to see the financials. He tells you what he wants in rent, but he tells you something interesting, like, Wait a second. Because I’m an owner, he’s like, I haven’t even taken this to market. I want to see what the market bear, I would like to see what the market bears right before I just before I just, you know, offload the space. What if I, did he give you like, well, if they pay this, I mean, otherwise, I’m taking it to the market.

Killinger 17:45
He said, he goes, let me talk to my broker. And then, so he talked to his broker or his agent. And then they got back to me that afternoon. And they said, Yeah, well, well, this is our price. Are you guys willing to do that? And it was high, of course, because we need some we needed a skylight. And I mean, it was just a box, really. And you want you on they’d come over and actually walked it that same day. And so they want this big skylight put in, so they want some ti work, right. And

Ressa 18:10
so so they walk the stage, so you call that? Yeah. And you say, Hey, we just met. Yeah, it’s Joe again. Yeah, just left. You remember me cell phones. Do you remember me? Yeah, I got a space for you. You have to come check out but you have to come right now. Yeah. And they come? And did they before they came to they ask how much it was or anything like that? No,

Killinger 18:35
no, they trust. It’s we don’t I just told him we didn’t know. We don’t know what the price is I lead with everything. Listen, I just got back. This signs going up. This is gonna go quick, because the traffic count on Santa Sandy is 40 50,000 cars a day. It’s everything you’re looking for. But we don’t know the price in terms yet. But I’d like to have you take a look at it before they start really marketing it. And that’s what they came.

Ressa 18:57
And that’s compelling. Right? If you’re a buyer, right, you’re like, Alright, maybe I’ve been off market kind of Yeah, opportunity to swoop in. Yeah, they come? Did they immediately fall in love? Or was it like you had to like sell them on it a

Killinger 19:10
bit. Had to sell. They really came with our cards close to their chest, right? They didn’t really want to talk about money. They didn’t really? You know, they didn’t know me. Yeah, exactly. They didn’t know me. And then here’s this little snot nose dude is running around, tell him this is the place for him. And you know, again, if he hadn’t even known about ask the right questions, and but they the person who referred to fruit referred me to them or was a good friend of mine. And they were they were also good friends with them. So it’s just a lot of I got very fortunate with a lot of people just knew each other in the community.

Ressa 19:46
So I don’t know if you can remember, but from that day, to when they signed the lease, how long of a time period

Killinger 19:56
not even two weeks.

Ressa 19:58
Wow. Imagine if you could close deals in two weeks now. I say this all the time. So this is this is what’s amazing to me. With all the technology in the world, right, we now emailed leases back and forth. When I was at my first job, we were FedExing comments back and forth. Oh, yeah, the mail. Isn’t that great? Yeah. And it went faster. Yeah. Deals move faster.

Killinger 20:25
Yeah. Yeah. Now it’s a I’m out of town. Well, shit. You got email, respond to the email.

Ressa 20:31
And deals move faster? Yes. It’s It’s astounding. It’s astounding. But deals move faster. And with all the technology we have they still move faster back then. So what from that? I was a I mean, but it two weeks was even fast back then. Oh, yeah. Yeah. But from meeting the client, to finding the space to making a deal, and then signing the deal. Two weeks, yeah. Unbelievable. So

Killinger 21:13
what, what are some simpler than to keep in mind? These contracts are so much more detailed. I mean, I don’t remember how many pages it was back then. But,

Ressa 21:21
but it wasn’t the 100 that Genesis today?

Killinger 21:23
Yeah. And a lot less attorneys, you know, so that was always a blessing.

Ressa 21:28
Oh, what? Are they still in Brentwood today?

Killinger 21:33
Yes, they close their other locations are still in Brentwood. Wow.

Ressa 21:37
Good for you, man. So what are some lessons the audience? Like? If you reflect back on that? What are some lessons the audience can take from that deal?

Killinger 21:47
Well, I can tell you, I went into this so green. And, you know, I think it goes back to Chris, I didn’t have a mentor. And that was that’s kind of a shame. Because, you know, I got very fortunate with this, I think we can all agree, right. And I just happen to run into the right people at the right time. But I just I also had the attitude of I’m gonna figure this out. I don’t know that. I could do that these days. But you there’s so much more to it. But

Ressa 22:12
well, I’ll give you some things that I that I take away. Which is one is I wonder. This isn’t a knock on you. But I wonder if you didn’t call them that day? Yeah. Would they have hired you? I say that because you’ve now provided they didn’t hire you at the when you got done meeting them. And so they’re they’re sitting there. We know how it goes. They’re sitting there thinking, what do you think of this guy? Yeah, he’s young. Enough, can he does he know what he’s doing can get it done. And so they’re thinking they’re unsure. But what did you do without having it? You provided some value? You call and say, Hey, I’ve solved it. I got it for you. I need you to come right now. Well, now that changes everything. Okay, maybe this guy does know what he’s doing. He heard us. He knows what we’re looking for. And he thinks he solved it. Right. If that space to me. Like was nothing like they were talking about? It was not on the main boulevard is in Brentwood. It was somewhere else, you would have lost it. But to me, you provided value so quickly, they would have been foolish not to work with you. Yeah. And so that’s the first thing like even though you didn’t have the assignment, you were working it. The second thing I take away from the story, which I don’t know happens as much anymore. is, you know, we rely on technology, and relationships for a lot of information, and we should, but this maintenance guy was sitting right there. And so you went and talked to the maintenance guy. Yeah. Didn’t have a relationship with this guy. You didn’t call a broker friend. Hey, do you know what’s going on with the the gap space? Yeah, in Brentwood. You walked right in. And then he told you, I think the owner should be here in 20 minutes. I have no idea. You waited around. And then you went in and made it happen. So to me, it’s like even in a world with technology and data. Grip means a lot and you know, and just finding a way to find a solution. To me. That might seem to some that might seem like yeah, I talked to the maintenance person. But I can tell you a lot of people don’t talk to the maintenance per Listen, rely on technology and data. Let’s go to costars listed on coastal. Yeah, exactly. Well, Jack there, right. Well, it’s

Killinger 25:07
gone. Talk to the maintenance guy. Yeah. He’ll tell you, it’d be gone. But now with, you know, in that area, it was such a hot area, there’s really no other. There’s nothing because I was like, I’m not sure where I’m gonna put them. You know something about man, they have a pretty hard requirement. And then this was, you know, the clouds parted and the doves flew out, and there was,

Ressa 25:29
yeah. Well, Joe, thank you for telling that story. I appreciate Yeah. Is that your first deal?

Killinger 25:37
Oh, yeah. In commercial real estate. That was my first deal.

Ressa 25:40
There’s one other lesson I learned from this. You kind of slid it in the interview. So obviously, you kept that relationship for a long time, because you’re interviewing the order sunt. Today, Tommy, how that relationship continued? Yeah.

Killinger 25:59
Yeah, it’s this whole business is relationships, right? And it’s maintaining them. We’ve worked so hard to make that initial additional or first contact, that you don’t want to lose it. You know, if you have to go back and just constantly make new contacts all the time. Build relationships.

Ressa 26:19
So I’m gonna totally so I’m gonna put you on the spot. Is he getting the job?

Killinger 26:26
Please, the first interview stuck. There is some pressure on like, all the people. Yeah, he’s, well, this kid is not achiever. He’s pretty amazing. So yeah, it’s I think he’s gonna He’s gonna actually I’m just stepping in for part of the interview. And our marketing team is going to be doing the interview with him. So but he’s impressive. He’s just like, incredible people.

Ressa 26:51
Great. Well, Joe, really appreciate the story. I’m going to take us to the end of the show. I have three questions for you. Are you ready?

Killinger 27:03
Probably not. What do you got?

Ressa 27:09
What extinct retailer Do you wish would come back from the dead? Oh, this

Killinger 27:12
easy one. So I’m in marketing, right. And I would get like I said, I was small town, Nebraska. That Sears catalog had come in the market come in the mail. That was so Sears Eddie Lampert. Got

Ressa 27:26
it damn him. All right. Sears question, too. Yeah. What is the last item over $20 You bought in store

Killinger 27:36
groceries last night, but I am. I’ve gotta go to a wedding. You know, I’m really good about using my calendar. But I look and I’ve got a wedding next weekend. And I’ve got to get some pet leather shoes to go with my tux. So I’m looking for that. I don’t even know where to start with that one.

Ressa 27:56
You’re in how you’re in Los Angeles. Good spots. Yeah. You’ll find some spots. Okay. Last question. If you went I was shopping at Target. And I lost you. Yeah. What I would I find you in

Killinger 28:12
sporting goods. I’m always looking at new tennis balls. So it’s always sporting goods, or maybe a new tennis racket.

Ressa 28:20
How long have you been playing tennis?

Killinger 28:22
Playing? There’s a difference playing tennis and playing tennis? Well. You know, I’ve been playing decent for the last like eight years. But before that, I just have to kind of whacking at it. I love it. An incredible sport. Did you take lessons? No YouTube videos and getting my ass kicked by pretty much everybody. In the beginning. It just really ended. But a lot of YouTube videos I was I’m amazed that you can really learn a lot that you can you can take me out on a court with an instructor. I just can’t make it work. But if I watch somebody else do it over and over and over again. I pick it up. So YouTube was the best for me.

Ressa 29:04
Got it. Well, Joe, I really appreciate this. Thanks so much for coming on. Thanks

Killinger 29:10
for having me, Chris. I appreciate it.

Ressa 29:12
Thank you. And where can people find you Joe?

Killinger 29:16
You can go to my website Joe kill injure.co Joe calendar.co Direct Line 310943854231094385.

Ressa 29:28
Excellent. All right. Joe, thanks so much. Thank you. Thank you for listening to retail retold. If you want to share a story about a retail real estate deal that you were a part of on our show. Please reach out to us at retail retold at DLC mgmt.com This show highlights the stories behind the deals from all perspectives. So it doesn’t matter if you are a retailer, broker, entrepreneur, architect or an attorney. Also, don’t forget to Subscribe to retail retold so you don’t miss out on next Thursday’s episode