The strip mall is an American institution as unsexy as it is ubiquitous. But one savvy investor has rode the asset class to both riches and social media celebrity.
That’s StripMallGuy. In real life, he’s a 40-something real estate investment manager based in New York City with nearly three dozen deals under his belt who now runs a $100 million property fund. On Twitter, he’s a cartoon brown-haired dude in a sweater vest who delivers spicy takes on the real estate business under the handle @RealEstateTrent.
Since starting his account in 2021, he’s amassed more than 160,000 followers by dishing out advice on everything from life and career choices to lease negotiations and the tenant mix that will cause the least amount of strain on your strip mall’s parking lot.
“Do you know that crappy strip mall around the corner from your house, the one with that liquor store and nail salon, and donut shop?” he tweeted on a recent Sunday evening. “It’s a gold mine. Very few understand this.”
Under condition of anonymity, The Real Deal chatted with StripMallGuy about his commercial real estate investing philosophy, why he stays anonymous and why you should never, ever accept Chick-fil-A as a tenant.
This interview has been edited and condensed for clarity.
You started this account on a plane.
I kind of lurked on Twitter with my personal account for a few years and nothing came of it. Every time I would draft a tweet, I would say, “What if this investor read this, or a tenant or a family member or a friend, or one of our employees?” I wouldn’t put anything out there out of a fear of how it may be interpreted. It turns out that’s the opposite approach of how you should do Twitter. I was on a plane and had an hour to kill, and I thought, let me just open an anonymous account. Real estate Bill, Bob, David were taken. Trent, I have no idea how I came up with that, but it was available.
I didn’t think this account would have any visibility ever beyond like 35 people. I was just speaking “open kimono” based on 20 years of experience in real estate.
What made you qualified?
I started from the ground up. I knew nothing about real estate whatsoever. When I graduated college, I went to do leasing for Class B strip centers. I found that there’s a ton of inefficiency in that space, and it’s all I’ve been doing since. I never graduated to grocery-anchored retails or big box or malls. And with that comes, you know, negotiation skills that you learn and networking skills. It goes beyond just strip mall deals – you’re financing deals and you’re dealing with attorneys and contractors and architects, and, you know, there’s a lot to it.
What is so great about a strip mall? Give me the sales pitch.
A lot of our memories growing up involve a strip mall. My mom meets her friends at the nail salon, it’s someone’s birthday, we go get pizza. Everyone has their favorite local restaurant. You grow up spending time at the strip mall, whether or not you realize it. It’s part of our human experience.
It’s also a niche that very few think of and say, “Hey, this is actually an investment.” Everyone groups retail into one bucket, which is the mall. The strip malls are in our suburban neighborhoods. They’re the services that we use every single day. They haven’t been impacted by Amazon. Amazon’s not going to impact my dentist or my hair salon, my coffee shop.
But how did you get all these investors on Twitter to care about them?
There’s a lot of focus on niche knowledge over the last few years, which Twitter is great for. Things that are not sexy, they’re out there that people make a lot of — there’s opportunity in these little niches. It’s the idea of this under-the-radar asset class that no one talks about on TV. There’s not a stock that you can buy that’s investing in neighborhood, 5,000-square-foot strip malls. It gives people exposure to this asset class that there’s not much written about. It’s the fact that I’m sharing anonymously.
Which allows straight talk.
Right. I’m saying, for example, karate owners are my least favorite tenants. Nice people, don’t get me wrong, but they don’t put much money into the space a lot of times. I would say overall, they pay rent lower than other tenants do.
One of my best tweets is a true story. Chick-fil-A wanted to be in one of our properties. Everyone says, “Oh, amazing, it’s Chick-fil-A.”
But, the moment that we sign a Chick-fil-A lease — we have 50 other tenants and they’ll leave. Here’s your Chick-fil-A that might add $3 million in value, but here’s your $80 million center where the rest of it goes down by $20 million. I get a lot of pushback. People don’t, respectfully, understand that.
“You grow up spending time at the strip mall, whether or not you realize it. It’s part of our human experience.”
Because of the traffic? Every time I drive past a Chick-fil-A there are a hundred cars lined up.
Right, the parking. Retail is all about parking. If going to the dentist or your nail salon was like a parking fight every time, you would say, “you’re a great dentist or whatever it is, but I can’t park.” Most people think to do the Chick-fil-A deal. They’re a great tenant, but there’s so much more to it in retail.
It’s not like apartments where you rent to whoever pays you the rent. We have to think of the implications of every lease that we sign. It’s a big puzzle, and I guess people find that interesting.
What’s your ideal tenant mix?
It’s all about co-tenancy. There’s a great argument for smoke shop, tattoo parlor, vape shop and check cashing. We have that, that’s great. But then, if you have a property where a restaurant is really busy for lunch, you want to mix that with someone who is really busy for dinner. Because of parking.
Hair salon, nail salon and coffee shop go together really well. Cookie shop and workout place — someone gets a cookie and coffee after they work out.
And if you’re starting from scratch?
Any time I don’t have any of those, I wonder why. We go recruit them. Because 95 percent of strip malls are not owned by institutions, they’re owned by local families and they don’t always think through — if I bring Starbucks in, how will it affect my parking? Will this yoga studio compete with the Pilates? Sounds different, but there’s overlap.
Yesterday, we got an offer from a dessert tenant. There’s a Starbucks next door, but we have decent parking. But dessert tenants — think boba tea — they crush it and have to do a lot of volume. It becomes a parking issue. And is this a lunch dessert or after-dinner dessert? We literally go through this.
“Retail is all about parking.”
You’re analyzing when people eat.
Also, when sandwich places want to be the exclusive sandwich place. You start getting into, well, what is a sandwich? They say they don’t want anyone else selling sandwiches. If the coffee guy sells a grilled cheese, is that a sandwich? A bagel tenant wants to come and they say bagels are fine, but once they slice it and put cream cheese in the middle, is that now a sandwich? Lawyers argue about this. I’ve been on calls and they’re yelling at each other about what a sandwich is.
StripMallGuy is this famous figure on Twitter. You’ve been retweeted by people like Bill Ackman. How do you feel about that?
It comes with responsibility now. A lot of people look to this account for their real estate news. I have to review each tweet a few times and think about how it might be interpreted, but at the same time, try to be candid. The brand is growing and it’s growing fast. I’m not sure where this goes. I’m not sure what to make of it. I’m first and foremost a real estate general partner. We have a real estate fund that’s my number one priority. I take it very, very seriously.
I do get imposter syndrome. I worked hard to build a career and suddenly I’m known as this cartoon character, right? Our three-year-old son, yesterday he was like, “Am I strip mall boy?”
You also talk about office defaults and the housing market, stuff that isn’t in your wheelhouse.
Twitter is all about growing your network. You realize that you’re being followed by heads of different industries and heads of brokerages and other fund managers and GPs from other asset classes, and they want to connect with you. The more that network grows, the better content I have access to and the more I share. It makes me a better GP, which encourages my deal flow.
“A bagel tenant wants to come and they say bagels are fine, but once they slice it and put cream cheese in the middle, is that now a sandwich?”
Have you actually raised through Twitter?
There are no deals yet that have happened because of Twitter, because I just started taking that approach. But, there are people that I’ve met through Twitter originally that have ended up being investors in my fund and have written me million-dollar-plus checks.
Have you ever been starstruck by a follower?
Reid Ferguson, who is the long snapper for the Buffalo Bills. They were in New York playing and we met for dinner and just talked about real estate. As you can tell, I get way too excited about strip malls. It’s feedback that I get — “You are more excited about strip malls in real life than I thought you to be.” Reid pays a lot of attention to investment opportunities, and we’ve become friends.