Passive Income Through Multifamily Real Estate

Latest Episodes:

Episode #137: Passive Investor to Business Exit to Opportunity Zones with Jake Gardner Oct 05, 2020

Show notes

Opportunity Zones were created to revitalize economically distressed communities using private investments rather than taxpayer dollars. However, due to their relative newness, Opportunity Zones are understandably unfamiliar to most investors and residents of these newly designated areas. What exactly are the benefits? Today’s guest is Jake Gardner, Head Of Investor Relations at the St. George Opportunity Zone Fund. Jake is a successful entrepreneur, starting his marketing technology firm seven years ago, which he just recently sold to a public company. As an investor, Jake focuses on finding unique projects in Opportunity Zones. In this episode, he shares with us his journey into real estate, verifies the importance of scaling, and explains why he believes COVID-19 is an opportunity for businesses to not only survive, but thrive. We discuss Opportunity Zones and the benefits for investors to defer capital gains, and Jake tells us what is different about the St. George Opportunity Zone Fund compared to other funds. We end the show with some rapid-fire questions to learn a bit more about Jake, and he shares what he has learned about listening as a passive investor that he’s using to his advantage as an investor relations liaison. For more on Opportunity Zones and the opportunities for investors, tune in today!

Key Points From This Episode:

Jake introduces himself and what he does.
Jake’s first passive investment in 2009 and how he got involved with his dad.
The most important thing Jake learned from this first passive investment was about scaling.
Appropriate scaling and why Jake thinks it is a real recipe for success.
Jakes's philosophy on diversification and how he has diversified his portfolio between life insurance, gold, and real estate.
Jake’s sentiments about investing in commercial real estate and why it’s worth finding deals.
Markets that Jake finds exciting now, particularly secondary and tertiary markets.
Sheltering down or expanding during a crisis and why Jake believes COVID-19 is an opportunity for businesses to survive and thrive.
The St. George Opportunity Zone Fund and Jake’s role to educate investors.
What opportunity zones are – a way for economically depressed communities to get investors and rehab their communities and a way for investors to defer capital gains.
What’s different about the St. George Opportunity Zone Fund compared to other funds.
What Jake has learned about listening as a passive investor that he’s using to his advantage as an investor relations liaison.

Links Mentioned in Today’s Episode:

Jake Gardner on Twitter

Jake Gardner on LinkedIn

Jake Gardner on Facebook

Jake Gardner on Instagram

Jake Gardner Email

St. George Opportunity Zone Fund

St. George Opportunity Zone Fund on Facebook

APT Capital Group

Wayne Patton

Wayne Patton’s Asset Protection

Passive Income through Multifamily Real Estate group on Facebook

Lalita Mitchell on Facebook

Kyle Mitchell on Facebook

Episode #136: Downside Protection with Tauheed Saddiqui Oct 02, 2020

Show notes

The topic of downside protection is of particular importance right now as we are all going through this current crisis and period of instability. Our guest, Tauheed Siddiqui, is here to discuss his thoughts on the subject and how he and his company, TAAS, have gone about preparing for the more difficult times. He mentions conservative underwriting as the best place to start with a safety net. He also explains the importance of the market in which you’re investing in and how you prepare before reminding us of the power of liquidity; you do not want to be going into a downturn without any cash! Tauheed is very generous in sharing some of the strategies he uses and is currently using to make it through the troubled waters, and from there we move onto leases and renewals and hedging known and unknown factors. For Tauheed, an intimate relationship with the data as well as close links to his property management company are what helps him sleep at night. Listen in with us for this episode of Asset Management Fridays, to get it all!

Key Points From This Episode:

Tauheed's work in real estate and land development.
The three key components of downside protection; underwriting, location, cash-reserves.
Setting aside a percentage of a purchase price for this downside period.
The knowns and unknowns and hedging these in the smartest ways for the future.
Examples of how Tauheed manages during downtimes; working with tenants and more!
Lease renewal practices during the pandemic — aligning with tenant needs as much as possible.
Tauheed's asset management superpowers: relationships and data.

Tweetables:

“The bottom line is, during the headwinds, would you be able to keep your head above the water?” — Tauheed Siddiqui [0:03:49]

“I just keep communicating to my property management company. The more you have a system, the more it is going to help our bottom line.” — Tauheed Siddiqui [0:05:57]

“You always want to be very careful with the expenses but more so now. So cut where you can and even revise some agreements if possible.” — Tauheed Siddiqui [0:05:57]

Links Mentioned in Today’s Episode:

Tauheed Siddiqui

TAAS
redIQ

Passive Income through Multifamily Real Estate Group on Facebook

Kyle Mitchell on Facebook

Episode #135: How to Close on a 1,200+ Unit Portfolio Deal with Jorge Abreu Sep 28, 2020

Show notes

While moving from single-family into multifamily is a gamechanger, once you start closing 1,000+ unit deals, things definitely switch gear again! Our guest on the show today is Jorge Abreu, and he joins us to talk about what it takes to close deals of that size, having recently closed on both a 1,000-unit portfolio and an 850-unit property too. Jorge is the co-founder and CEO of Elevate Commercial Investment Group and has over 1,700 doors on the GP side as well as over 1,400 doors on the LP side under management. He has the huge ambition of growing that number to 10,000 units in the coming years! Jorge believes that the more units you can manage, the easier managing them becomes and we get into why that is with him today. We chat with Jorge about how valuable systems, procedures, teams, and the right network of invested people are to the deal closing process, and especially so for larger deals. These factors help Jorge with everything from due dilligence to capital raising, acquisitions, and focusing on the best use of his time – networking and marketing! Jorge gives us an indication of the challenges that come with closing large deals too, talking about how he inspects so many units and the role of different software for assessing KPIs around rentals and construction. Tune in to learn more!

Key Points From This Episode:

Jorge’s 13-year real estate career, recently in multifamily and goal to reach 10,000 doors.
The role of teams and systems in Jorge’s ability to close 850+ unit deals.
Taking on the task of inspecting all the units on such huge deals using teams.
How Jorge got into taking down larger deals by partnering with those who had them already.
Different relationships vital for taking on larger scale deals: co-GPs, vendors, attorneys, etc.
Why asset management gets easier on larger properties; affording on-site staff.
The challenges of tracking leasing and construction KPIs even with the best software.
Jorge’s use of institutional equity partners to make raising large capital amounts easier.
Tips for building relationships and securing capital from equity partners using backups.
How Jorge delegates to focus on the best use of his time: networking and marketing.
Jorge’s goals for the future and hopes things will get back to normal soon.
Favorite tools of Jorge’s and his biggest mistake: not getting into multifamily earlier.
The thing that takes Jorge’s life to the next level: his systems and procedures.

Links Mentioned in Today’s Episode:

Jorge Abreu

Elevate Commercial Investment Group

Wayne Patton’s Asset Protection

Passive Income through Multifamily Real Estate group on Facebook

Lalita Mitchell on Facebook

Kyle Mitchell on Facebook

Episode #134: Controllable Expenses with Jason Yarusi Sep 25, 2020

Show notes

Jason Yarusi from Yarusi Holdings joins us today to give some practical advice for saving on controllable expenses. The first place where you want to start is with your utilities, and he shares how little adjustments in terms of water and electricity can make a big difference. Another area with cost-saving potential is contracts. When you have had the same service provider for years, it is easy to lose track of their rates and in doing so, you could be overpaying on services. That is why Jason advises listeners to renegotiate prices every year. When you start making these small upgrades to your property, be sure to include your tenants in the conversation and get their buy-in before you bump up the rent. The conversation concludes with Jason encouraging listeners to remain persistent in their real estate endeavors.

Key Points From This Episode:

Get a quick overview of Jason and his wife’s multifamily syndication firm and where they invest.
The biggest controllable expenses and what can be done to keep costs down.
The importance of paying attention to utilities and strategies for keeping the water bill at a minimum.
What Jason and his team are doing to save on the cost of electricity.
Paying attention to your contracts to ensure that you are not overpaying on services.
How they go about evaluating properties based on controllable expenses.
Communicating with tenants and getting their buy-in on your vision for the property before increasing rent.
Green strategies for saving expenses without compromising the property.
The superpower of persistence, moving forward, and tracking what you do.

Tweetables:

“Now is the time to get into your numbers and make sure that there are not things running wild.” — @JasonYarusi [0:05:06]

“You just need to keep consistent on it and really just be persistent.” — @JasonYarusi [0:10:46]

Links Mentioned in Today’s Episode:

Jason Yarusi on Twitter

Yarusi Holdings

The Jason and Pili Project

Asana
redIQ

Passive Income through Multifamily Real Estate Group on Facebook

Kyle Mitchell on Facebook

Episode #133: Joint Ventures with Jerome Myers Sep 21, 2020

Show notes

We know that deals can be structured in numerous ways. One model we don’t often hear about is joint ventures. Our guest today, Jerome Myers, has chosen this deal structure model to grow his real estate portfolio. As an asset manager for about 90 units and 90,000 square feet of workforce housing across Virginia and North Carolina, Jerome is also a passionate coach and teaches his methods of multifamily investing. In this episode, he walks us through joint ventures and how they are different from syndications. If syndications are commercial planes, with a crew and passengers, then joint ventures are fighter jets with no travelers. Everyone has an equal stake in the game. For Jerome, this model allows him to collaborate and engage with smart, creative people, who are all equally invested in achieving success. Along with this, we also touch on different debt structures, why he prefers to stay in the smaller multifamily space, and how joint ventures fulfill dual objectives of contributing to community good and making money. Be sure to tune in today!

Key Points From This Episode:

Learn more about Jerome’s background and what he’s currently involved in.
The difference between joint ventures and syndication and how Jerome found this model.
Jerome's first joint venture project and his take on buying and holding.
How Jerome and his team make use of local banks and the debt structure they offer.
Non-recourse vs recourse debt: The differences and respective advantages.
Structuring a joint venture and the importance of designating the partnership.
Find out how capital raising and decision-making work in Jerome’s joint venture.
Mistakes to avoid when setting up a joint venture.
The deal size Jerome’s currently pursuing and why he stays under 100-units.
Some of the other benefits of joints ventures.
Final four questions with Jerome: His biggest mistake, growing his life, and more.

Tweetables:

“Everything’s for sale, right? It’s just a matter of somebody wants it more than we do.” — Jerome Myers [0:05:35]

“We want to house nurses, firefighters, teachers. If help those folks out. They really make America run.” — Jerome Myers [0:09:50]

Links Mentioned in Today’s Episode:

Jerome Myers

Myers Development Group

Myers Methods

APT Capital Group

Passive Income Through Multifamily Real Estate Facebook Group

Free Call with Kyle or Lalita

Episode #132: Disposition with Ajai Sharma Sep 18, 2020

Show notes

Today on the podcast, listeners will hear from Ajai Sharma, the founder, and principal of AimNext Realty. Ajai oversees all aspects of property operations, including asset management, property management oversight, and investor relations. Since he entered the real estate investing space in 2008, he has been involved in almost 5,000 units as a passive investor and also a deal sponsor. In this episode, Ajai shares why he entered the real estate market in the most difficult economic period and decided to pivot to apartment syndication five or so years ago. For him, the most important aspect of the business is communication—with investors, executive property management staff, and brokers—because you never want to burn bridges. He explains why bonus plans for staff on the sale of a property is a good way to keep them committed to the cause and how that helps to ensure positive future working relationships. He walks us through their process of getting ready to sell a property after the five years, what they do when the returns are less than expected and whether they prioritize a higher price or surety of closing.

Key Points From This Episode:

Find out some background information about when our guest got into real estate investing.
Why Ajai decided to buy single-family homes amid the 2008/2009 economic crisis.
Hear why Ajai pivoted to and learned all about apartment syndication five years ago.
Communicating with investors regarding returns and distributions within their five-years plans.
The procedure they follow once they come close to the total return and are ready to sell.
Holding on to properties longer than five years when the returns are less than expected.
Why there is no such thing as over-communicating with your investors.
The importance of including the proper manager executive in the sales conversation.
The benefits of having a bonus plan for your staff in the pursuit of selling a property.
Never bring your property prematurely to the market and other sure-fire advice.
Which should be the priority: highest price or surety of the deal closing?

Tweetables:

“But in 2008 and 2009, I started as a single-family rental business. You know 2008/2009 was a blood bath in the whole real estate market but I felt that was the right opportunity to buy a good chunk of single-family homes.” — Ajai Sharma [0:01:24]

“Investor communication is key. There is nothing like over communication with your investor. You should always get engaged.” — Ajai Sharma [0:06:13]

“Never sell the property prematurely, never try to sell the property without a broker, always have your management company in your confidence so they know what is going on.” — Ajai Sharma [0:11:17]

Links Mentioned in Today’s Episode:

Ajai Sharma on Facebook

Aimnext Realty
redIQ

Passive Income through Multifamily Real Estate Group on Facebook

Kyle Mitchell on Facebook

Episode #131: The CARES Act with Damion Lupo Sep 14, 2020

Show notes

Today on the Passive Investment Through Multi-family Real Estate Podcast we are joined by Damion Lupo! Damion has a long history in entrepreneurship and he is here to talk about the new CARES Act and how it might affect the foreseeable future for real estate investors. Damion does a sterling job of explaining the particulars of the act and what it means right now, leading into the rest of the calendar year. Although the reasons for the act might be apparent in the current crisis, Damion is skeptical of its long term benefits, foreseeing a damaging effect on the dollar and the American economy in general. We discuss what the CARES Act allows individuals to do, in terms of withdrawals and repayments and what this means for taxation. The stimulus packages that have already been implemented have relieved the finances of many businesses but how far can this strategy legitimately be stretched? Damion does not believe very much further, without some very negative results. All that being said it pays to be in the know with regards to what this all means to your money and that is where Damion’s great expertise comes into play! For all of this and a whole more in a critical time for yours and everyone else's investments, be sure to listen in!

Key Points From This Episode:

Damion’s entrepreneurial history and his current focus on breaking financial shackles.
Some background on the CARES Act and how it affects investors and syndicators.
Limits on withdrawals and timeframes under the new regulations.
The tax implication for the CARES Act and some interesting available strategies.
Unwise spending and making the most of the positive opportunities that are presented.
The likely long term effects of the CARES Act on the American economy and dollar.
Universal basic income and the current stimulus packages that are being released.
What the shortage of precious metals available for purchases shows.
The huge changes that are likely on the way and the sectors that will be hit hardest.
Damion's reliance on his critical judgment going into deals.
The biggest lesson that Damion has learned in real estate around awareness and foresight.
Why Damion wants to spend more time around bald people!

Links Mentioned in Today’s Episode:

Damion Lupo

Financial Underdogs Podcast

Damion Lupo on Twitter

Wayne Patton Phone Number

APT Capital Group on YouTube

Passive Income Through Multifamily Real Estate Facebook Group

Free Call with Kyle or Lalita

Episode #130: Strengthening Investor Relations with Ivan Barratt Sep 11, 2020

Show notes

Strong investor relations are a crucial part of the syndication puzzle. Without these, it will be very difficult to thrive in the business. Our guest today, Ivan Barratt of Barratt Asset Management, is here to share his top tips on creating investor relationships that propel you to success. In this episode, we learn about the importance of investor communication. Ivan shares how frequently he interacts with investors and the various platforms he uses. It is important to be open and transparent with investors, particularly in difficult times. Investors understand that things may not go to plan, so keeping them in the loop will quell any anxieties. Along with this, strong returns always go a long way in growing the relationship. Ivan also sheds light on some other investor relations strategies he uses as well as his superpower. Be sure to tune in today!

Key Points From This Episode:

Find out more about Ivan’s background and what he’s accomplished over the last 10 years.
How often Ivan communicates with investors and the different channels he utilizes.
Learn how Ivan’s handled disgruntled investors and tips on maintaining good relationships.
Other tactics Ivan uses to show investor appreciation and his superpower.

Tweetables:

“Our investor mandate is to maximize value, maximize returns for those investors, but we are the chef in the kitchen.” — @ivanbarratt [0:03:19]

“A really great way to approach investors is to be as transparent as possible, a 100% if you can with your thesis, your hold period, what can go wrong, what are the risks, what's the plan, as much as you can.” — @ivanbarratt [0:04:43]

Links Mentioned in Today’s Episode:

Ivan Barratt

Ivan Barratt’s number

Ivan Barratt Education

Barratt Asset Management

HubSpot
redIQ

Investor Management Services

Passive Income Through Multifamily Real Estate Facebook Group

Free Call with Kyle or Lalita

Episode #129: 27 Passive Investments with 14 Different Sponsors with Travis Watts Sep 07, 2020

Show notes

Diversification can be a great ally in the game of passive investing and today's guest is a wonderful example of this! Travis Watts currently has 27 investments, utilizing 14 different sponsors, and while this high number might be a bit unusual, our conversation makes it quite clear how Travis has made this work for him and his business. Travis believes in recession-resistant asset classes and he unpacks exactly what that means to him. We get to hear about his real estate journey and the lessons he learned when he started out focussing on active projects. Travis comments on his appreciation of good communication, the usefulness of video and photos, and how he goes about vetting sponsors. We also dig into Travis' management process and style, his focus on cashflow, and the challenges he has weathered in his career thus far. With the world in a state of uncertainty, Travis' emphasis on certain types of asset classes is something useful for all listeners to think about, so tune in and get it all!

Key Points From This Episode:

Travis' background and how he got started in the passive real estate investing game!
A stand out facet of investor relations for Travis; monthly reporting and distributions.
The power of video and photos for getting to grips with a property.
Travis' approach to viewing properties outside of his home state.
Vetting sponsors and making sure they fit your criteria for investments.
The emphasis that Travis places on value-add and his preference for the B-class sector.
Travis’ choice for a wide range of diversified sponsors over a smaller number.
Some of the biggest challenges of passively investing in 14 properties.
How Travis streamlines his management process using an Excel spreadsheet.
Differences between good and bad performance in deals.
Travis' allocations between multifamily and other types of investments.
Thoughts on multifamily moving forward and Travis’ philosophy for the next few years.
The factors that Travis pays the closest attention to when assessing an investment opportunity.
The power of patience; waiting for the right deal before you dive in.
Travis's all-round reliance on his computer for all facets of his work!
An example of an emotional mistake Travis made in his days in active investing.
The difference that mentors have made in Travis' professional and personal life.

Tweetables:

“I’d say that’s number one, is just being proactive and staying on top of things with your investors.” — Travis Watts [0:03:29]

“Once you define your exact criteria or close to it, then as emails get pushed your way, it’s easier to sort them out.” — Travis Watts [0:06:10]

“I wanted to hyper-diversify. I wanted to be in multiple states with multiple different groups and multiple different assets.” — Travis Watts [0:10:32]

Links Mentioned in Today’s Episode:

Asset Protection Attorney Wayne Patton

Passive Income through Multifamily Real Estate Group on Facebook

Kyle Mitchell on Facebook

Lalita Mitchell on Facebook

Episode #128: Monthly Reporting with Kyle Mitchell Sep 04, 2020

Show notes

Going through a property’s monthly reports might not be the most glamorous syndication related activity, but it is incredibly important. You need to inspect each report with a fine-tooth comb to ensure that all of the numbers are correct. Today, Kyle Mitchell, co-host of this show, is in the hot seat, answering questions about monthly reporting. In this episode, Kyle talks about the new company he and Gary are launching and what they’ll be working on. He then takes us through his process of reviewing monthly reports, highlighting some of the common areas where he sees mistakes. From double changes to accidental fees, it’s easy for property management companies with a large clientele to make mistakes. Kyle stresses the importance of going into the ledger rather than looking at the summary report. Along with this, we also talk about tax expensing in your budget, being a signer on your bank account, and more. Be sure to tune in today!

Key Points From This Episode:

Learn more about Kyle and the new project he’s going to be launching with Gary.
Find out more about the process of reviewing the monthly reporting of a property.
Three of the most common mistakes Kyle typically sees with monthly reporting.
Why it’s important to go into the ledger and not only look at the summary report.
Two monthly report expenses sponsors typically forget when underwriting a property.
Banking and property ownership: Who has access and types of accounts.
Kyle’s asset management superpower and where you can find him.

Tweetables:

“As asset managers, you got to dig in a little bit deeper and peel back the onion a bit.” — Kyle Mitchell [0:02:38]

“It’s important to really dig into these reports and take a look.” — Kyle Mitchell [0:04:41]

“I just love the details. The devil is in the details.” — Kyle Mitchell [0:14:43]

Links Mentioned in Today’s Episode:

Kyle Mitchell

APT Capital Group

APT Capital Group - YouTube Channel

Passive Income Through Multifamily Real Estate Facebook Group

Free Call with Kyle or Lalita

redIQ
Garzella Group