Happy Friday. This is The Shake 🤝: the weekly newsletter on a mission to break down every acronym in the real estate industry… only 1% of the way there but we got time!

Here’s what we got this week:

• TDR: Turning Restricted Landowners Into Money-Wizards 🧙 

• Automation Galore: VA Edition 💻️ 

MARKET RADAR

TDR: Turning Restricted Landowners Into Money-Wizards 🧙 

Making money out of thin air is impossible… unless you’re a lucky restricted landowner. Get ready to unlock the secrets of TDR programs, where landowners become the ultimate money wizards.

In case you’re wondering, TDR stands for transferable development rights. 

Picture this: you own a piece of land in an area where building is a big no-no due to environmental concerns. But fear not! TDR swoops in to save the day, granting you the power to teleport your building rights to a more favorable location. It's like pulling a rabbit out of a hat, but with land instead!

Here's the trick: by shifting the development rights from the restricted zone to a zone craving more buildings, the overall number of houses in the region remains the same. This means there's enough money floating around to compensate the landowners 🤑 in the no-go zone without jeopardizing the profits of others.

So how does one get a portion of the purchase price for land they don't even own?

When zoning is changed in the TDR destination, allowing more units to be built, it creates a golden opportunity for landowners. They can now earn more money than they ever dreamed of! And that newfound cash is like a treasure chest waiting to be distributed to those whose development rights were taken away. It's Robin Hood but with land profits!

Sounds complicated? Let’s simplify the trickery.

First, the right to build on the restricted land is "separated" from the actual location. This is called the sending zone. It's like cutting a piece of cake and putting it on another plate, but with legal jargon involved.

Then, when a developer wants to utilize this magical right on land where they’re encouraged to build, they buy the rights to increase the density, and the original owner gets compensated. This is called the receiving zone.

Clear enough for ya? - Tupac, Picture me rollin

To keep this program running smoothly, there are even banks dedicated to managing the development rights and the accumulated interest. It's like a vault filled with land-based treasures! Some states even created their own Transfer of Development Rights Bank because, hey, why not?

What guarantees does the landowner in the restricted area have?

That’s the catch, most TDR programs don't include guarantees. They face the risks of the development zone municipalities not allowing higher densities or developers not showing enough interest in approved zones.

These opportunities take time to formulate (as do most creative real estate plays). Nevertheless, smart minds are working to manage these risks and ensure everyone gets a piece of the land-shaped pie 🥧 

In summary, TDR programs turn landowners into the money wizards of our time by:

1. Teleporting building rights

2. Creating a fair compensation game

3. Bringing joy to environmentalists and developers alike

It's a whimsical dance of zoning changes, bank management, and the wonders of buying and selling development rights.

In the world of TDR, anything is possible if you believe in the power of land and a touch of magic! 🪄 

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Automation Galore: VA Edition 💻️ 

We often think about the real estate industry as one that suffers from groupthink the most, and the commercial space often falls victim to it.

Sure, there are tried and true methods in the CRE brokerage space that will never go out of style (everyone here just thought of the one principal at the firm that still harps on cold calls, and I’m sorry for that visual).

Not to assume that everyone who enters the space went to college, but many who did remember the days of cheating to get by trying to find creative shortcuts around our coursework.

For decades, CRE was a space that hung its hat on deep relationship-building and industry best practices that took determination, long hours, and a ton of grit.

Enter the millennials who would rather do anything than pick up the phone and… call someone they don’t know?!?! gasp so some decide to use Virtual Assistants to take this task (or many, many others) off of their plate.

S/O to Task Wizard, not only are they awesome people, they’re hyperfocused on perfecting the VA process for CRE.

The use of Virtual Assistants (VAs) is picking up speed in the sector but has been a heavily scrutinized practice as well. This mostly comes from the fact that the CRE space is one that is complicated in many ways.

Here we bring you the scintillating tale of how virtual assistants have managed to infiltrate the sacred realm of commercial real estate. Brace yourselves, because this revolutionary development is going to blow your socks off (or at least mildly entertain you).

The first reason people consider VAs?

Automation Galore: Who needs human employees when you can have virtual assistants do all the grunt work for you? Need to research market trends, compile data, or generate reports? Boom! Virtual assistant to the rescue. VAs can tirelessly crunch numbers and churn out mind-numbing spreadsheets, freeing you up to focus on the more glamorous aspects of real estate, like...

Next up? Round-the-Clock Support: Gone are the days of 9-to-5 availability!

Virtual assistants are your ultimate companions, ready to serve, day or night. No more waiting for business hours to get your burning questions answered or tasks completed. Need someone to schedule a meeting at 3 a.m. with a client in another time zone? Your VA can help you to do so!

It’s no secret that CRE is completely a dollars and cents game.

The #1 reason VAs are used is that they are a Cost-Effective Solution: let's be honest, hiring US-based labor can be quite expensive. You have to worry about salaries, benefits, vacation time, and sometimes pesky emotions.

Virtual assistants, on the other hand, come with a much smaller price tag. Sure, the business may feel less like a family with having a team of people you never meet, but VAs generally speaking are great teammates who hustle hard.

Of course, there are some downsides to the use of virtual assistants, which is why (like most things) this isn’t a blanket solution.

Some savvy prospects still want to feel as though when they receive a note or a call from a brokerage firm that it is a genuine one. Technological glitches and (at times) a small language barrier may get in the way of the mission, but anyone who uses VAs will tell you it’s all about how these people are deployed into your business.

Virtual assistants have made their grand entrance into the world of commercial real estate, bringing with them a mix of efficiency, convenience, and occasional technological blunders. Embrace the future, but don't forget to keep a spare cookie or two on hand for those moments when a genuine touch will do.

FIN 🤝 If you enjoyed this week's edition, don’t be selfish — share with a friend!

^{DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.}