Dave Codrea, co-founder of Greenleaf, an Atlanta-based real estate investment firm, prioritizes quality affordable housing and compassionate partnerships with residents. Since its inception as a two-person venture, Greenleaf has expanded across multiple states in the Southeastern US, managing a diverse portfolio including Apartments, Mobile Homes, and Commercial properties. Dave oversees operational activities, investment management, and capital projects, emphasizing innovation and goal-setting. Outside of work, Dave enjoys adventurous outdoor activities with his family, including remote rafting expeditions and overland trips. With a background in financial consulting at Deloitte, Dave brings expertise and leadership to Greenleaf’s mission.
Episode Highlights Here:
Brett
What’s the number one secret to converting office to industrial flex?
Dave
I think looking for ways that you can take the skill sets you have and apply them to what the current market conditions are. I started 15 years ago in a defunct multifamily that was in super bad shape. No one wanted it. And it was really a struggle to figure out what you’re going to do with it. And that same kind of environment right now is bleeding into some of these older office assets that need a lot of extra love. And you got to find some creative way to use the space, it’s there. A lot of it can be handed a good deal. So we’re really taking our playbook from 15 years ago on buying some kind of terrible multifamily or assets that have been long term neglected. And we’re doing the same thing with the office right now and finding what’s the best use for that space. And for us it seems to be industrial flex, at least in the southeast, where we’re seeing the biggest demand.
Brett
Excellent. Yeah, that is. That is, that makes a lot of sense. It’s kind of being creative and figuring out ways to take something that perhaps was a little more obsolete and making it to investment and more you know, adding value to the community whatnot. And so this is really interesting, right, because the office, the office space, is dying a lot of spaces. Sylvain, talk about the opportunity and what you’re seeing and maybe give us kind of a live example to this Dave.
Dave
Typical deal that we’re seeing is to call it 20 30,000 square feet of a single storey building, outside of a downtown area. And there hasn’t been a lot of demand for it, there hasn’t been a lot of use for it. There’s a lot of old cubicles in it, and it’s a space that can really be converted to any kind of vision you would have for it. So when you start driving around and noticing them, you’ll see a lot of buildings that you’re like. It doesn’t look like it’s the cleanest it looks like something else could be done there. That’s really what we’re looking for.
Brett
Excellent. And so Okay, 20 to 30,000 square feet outside of the downtown area. It’s sleepy and tired and you guys are coming in and saying okay, what can we do? So what does it look like? You know, step by step, you find that opportunity, find a location, and what are you doing to, you know, increase the value and change it into industrial flex,
Dave
any, any initial investment you’re looking at making, you know, we have our areas that we operate in, we don’t really deviate from them, we’re not really trying to go find new markets. We’re predominantly buying stuff in Atlanta to Charlotte, we’re comfortable there. So making sure one you’re comfortable in the area you want to invest in, I think is key start. And then once we have a property or once we identify one, really using a lot of our skill sets that we that we honed over the years in multifamily, which is a lot of construction, a lot of demolition Rebelde to take a single storey building and really just got the inside of it, take out all the old offices remove everything that’s in there and get it. So what we call a white box scenario where you have elevated ceilings, you have large clear spaces you have, you know, no kind of like divided up minor walls, that really gives someone that’s coming in an opportunity, especially in the industrial, the flex of the warehouse type users to come in and use that space, however they seem best for their operation.
Brett
And are they typically a single tenant or multi tenant and we I guess it depends on the deal itself. But who is the ideal tenant or tenants that you’re finding to put into these spaces.
Dave
A lot of these spaces are divided into smaller floor plans. So like four to 5000 square feet, you got, you know, smaller suites and places that go in there, Atlanta has a lot of film stuff happening lately. So there’s shops that specialize in audio equipment, and they’ll rent a suite. And we have everything from small operators that are doing HVAC companies and that kind of stuff, electrician, so a lot of like service providers that have to have a home base are based out of their or small distribution companies.
Brett
Excellent. And then as far as potential returns because industrials, been, you know, white hot for a while now and it seems to be slowing down? What are you seeing in that space and those trends and how is interest rates being that they’ve increased so much affecting opportunities to value add hands on, you know, development costs,
Dave
where interest rates impact, you know, construction loans in a big way, it’s, it’s a lot harder to even get a construction loan right now. So it’s definitely equity heavy. On the front end doing anything, that’s a turnaround value add position. But kind of you’re taking one asset class that has a lot of headwinds being office and moving it to an asset class that has a lot of tailwinds in industry. So we’re really looking at a variance in the price per square foot that an industrial is trading at or what an office is trading at. And we’re able to have a pretty good spread there where if you can get defunct office space in that, even call it like 60 to $90 a square foot and flex is worth 100 230 square foot, you have a good spread that you’re looking to do and as long as you can find a way to reasonably turn things in a pretty narrow timeline. You know, you don’t want to take two years to go do something.
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About Dave Codrea
Dave is co-founder of Greenleaf, an Atlanta based real estate investment firm. From the very beginning, Dave built Greenleaf to be a provider of quality affordable housing that offers a unique compassion and partnership with residents. Since its inception as a two-man venture, Greenleaf has grown its geographic footprint to encompass several states in the Southeastern US. The growing portfolio currently includes Apartments, Mobile Homes, and Commercial properties. Our investment, management, and construction platforms work in sync providing top level customer experience, impressive investment returns, and a culture of innovation and goal setting.
Dave is an avid adventurer and loves all things outdoors including remote rafting expeditions, overland trips, and the local running scene. If there is a break, Dave will be outside. He has a traveling pack of 3 kids whose favorite words are “outside”. His wife, Sarah, is a physician that can fix any bump or bruise along the way on their journeys together.
Dave co-founded Greenleaf in 2008 and heads all operational activities of the company. Dave oversees investment management, capital projects oversight, financial reporting and budgeting, and operational execution with a focus on leading with innovation and goal focus. Dave built Greenleaf to be a provider of quality affordable housing that offers unique compassion and partnership with residents. In addition to real estate experience, he has a background in financial consulting with Deloitte.
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