How to Make Serious Money in Commercial Property: The 6-Step Framework
TL;DR
There are six steps to making serious money in commercial property, and the order matters more than anything else. Find the property, run a fast feasibility, secure it, complete due diligence and finance together, manufacture the value, then hold or sell. The discipline is testing whether there is a real margin before you spend a dollar on lawyers, and engineering an uplift early so the asset is derisked from day one. Applied properly it works every time. Skipped, it fails every time.
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The six steps
Making money in commercial property is not luck and it is not complicated. It is a sequence, and the order is deliberate. The six steps are: find the property, run your feasibility, contract and secure it, complete your due diligence and finance, manufacture the value, then hold or sell.
Steps one and two are about finding and testing. You find deals four ways: online listings, driving billboards, building relationships with agents for off-market stock, and tapping tenant demand, which is often the easiest deal to underwrite. Then you run a fast feasibility, four or five minutes to a yes or no, before you spend time and legal money. If there is any doubt, it is a no, and you move on.
Steps three and four are about securing and confirming. Lock the commercial terms first with a one-page heads of agreement, then pay a lawyer to turn that into a contract. Then run due diligence and finance together: the property and location, the tenant and the lease, and the market, alongside your bank or non-bank funding.
Step five is where the money is made. You manufacture the value early, during due diligence and settlement, by derisking the income, lifting the net receipts, or improving quality so the cap rate compresses. Do it early and the asset is worth more than it cost you from day one, so even if the market dips you are square.
Step six is hold or sell, and you start with why you bought the asset. Weigh the purpose, the opportunity cost of your capital, and the transaction and tax costs before you assume a number. Review the strategy on every asset at least every six months.
Where to go from here
Most people start with the free training. Cal’s Fortify Your Wealth series is a free multi-part video series on the strategies he uses when the market shifts, and there are weekly videos on YouTube.
If you would rather talk it through, book a quick 15-minute intro call with the Investor Code team: book an intro call.
And for the full framework in depth, that is the Commercial Property Mastery online course.
Frequently asked questions
What are the six steps to making money in commercial property?
Find the property, run a feasibility, contract and secure it, complete due diligence and finance, manufacture the value, then hold or sell. The order is the critical part: you test whether there is a margin before you spend money securing the deal.
Why does the feasibility come before contracting?
Because there is no point spending time and legal fees on a property that does not stack up. A fast feasibility gives you a yes or no in a few minutes, so you only commit resources to deals with a real margin.
How do you find commercial property deals in Australia?
Four ways: online listings on realcommercial.com.au and commercialrealestate.com.au, driving precincts to read billboards, building relationships with trusted agents for off-market stock, and tapping tenant demand, which is often the easiest deal to underwrite.
What does manufacturing value mean?
Actively improving the income or risk profile of an asset so it is worth more: extending a good lease, upgrading the tenant covenant, adding income streams, restructuring the lease, or improving quality to compress the cap rate. It is done early to derisk the asset from day one.
Should I use a bank or a non-bank lender?
Banks are cheapest but slowest and most conservative, with lower leverage. Non-banks are faster and higher-leverage but more expensive. The right choice depends on your timeline and strategy, and your feasibility should model both.