We interview Christian Mercado from Cornerstone Investments.
We discuss:
- How Christian found and funded his first deal
- His entrepreneurial journey
- Why he changed from residential to commercial real estate
- Transactional investing vs. passive investing
- Why you need to upgrade your asset class
- How Christians staff is set up
Christian, a born and raised Dallas, Texan, and Army veteran, got started full time in real estate in 2019. Beginning with a primary residence turned to single-family rental, he quickly transitioned to flipping homes, AirBnB arbitrage, and finally commercial real estate. After being let go of his W2 unexpectedly in February of 2020, he dedicated the rest of the year to learning about self-storage and commercial real estate.
He acquired his first two properties in January of 2021 via a $200 direct mail campaign. Originally purchased for $775,000 and $0 down, he was able to triple his NOI the first year and tripling valuation.
In February of 2022, he acquired a portfolio consisting of seven properties totaling 60,000 square feet. This time utilizing a 1031 exchange from selling his single-family rental and the experience from his first two storage facilities, he was able to get the seller to carry 10% and the bank brought 80% with interest only the first year. With $670,000 in equity the day of closing and instantly lowering LTV from 90% to 58% , his primary focus on this acquisition had been increasing occupancy to a trailing 81% MTD from a meager 39%. He enjoys the challenge of heavy lifts and complete turn arounds to put his operational skills to the test. As he continues to build out his portfolio, he will focus on higher grade investments.
At age 30, Christian privately owns over $6 million in commercial real estate with a projected upside of over $8 million upon global stabilization. His goal is to build a personal portfolio of one million square feet and build the small multifamily investment firm he's a part of to $1B+. Christian envisions building something greater than himself to leave a lasting impact on his family and community, and to gain time back to freely spend it as he wishes, usually with his wife and two-year-old daughter.