Posts tagged "syndication"

JC 099: How to Raise More Capital with Jake Marmulstein

September 23rd, 2020 | no comments

Groundbreaker Will Simplify Your Syndication

Before founding Groundbreaker, Jake Marmulstein held a number of roles involving real estate and technology, supporting the growth of early stage digital technology ventures while working with the government on foreign direct investment by Fortune 500s. In 2011, he started his career in real estate, underwriting hotel investments for Watermark Capital Partners.

At Groundbreaker, Jake owns the Company’s strategic vision and execution. He is responsible for sales, management of the departments and the people leading them. Jake also manages Company finances and capitalization, as well as the Board.

Jake Marmulstein joins John Carney today in The Real Estate Locker Room to share how using technology platforms will increase investor confidence.

Key Points:

  1. Look at markets that are underserved and listen to what people are saying.
  2. Real estate syndication technology allows you to automate the process and raise more capital.
  3. The more investors you have, the greater your need for a platform to manage them.
  4. Simplify! Presentation and easy user experience is important.
  5. Streamline your syndication process.

Favorite Sports:

  • Soccer and Rugby

Favorite Books:

Pro tip:

  • Don’t be too greedy with your first deal. Just do what you need to do to get the job done.

Reach Out to Jake Marmulstein

Thank you, Jake Marmulsteinfor taking the time to share how to provide real estate investors with access to more capital.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2020

 

 

 

JC 094: Open Door Capital with Jens Nielsen

July 8th, 2020 | no comments

Return on Your Investment with Multifamily Syndication.

Originally from Denmark, Jens Nielsen has lived in the United States since 1996. After a successful career in telecommunications and IT, Jens shifted his focus from being an employee to becoming an entrepreneur. He was attracted to multifamily real estate due to the many benefits and began investing in his home state of Colorado where he is currently the key principal of an 82-unit apartment portfolio.

 

After achieving success as a Limited Partner (LP), Jens decided to raise money as the General Partner (GP) in real estate syndication and raised over $1M in 2019 alone. He has passively invested in 14 real estate syndications / private investments that include over 800 apartment units, 2,000 mobile park lots and over 6000 storage units as well as mortgage note funds and private money lending. Jens mission is to help more people invest in private placements for the strong cash flow and equity growth. His company’s mission is to “Open Doors to your secure financial future through multifamily investing.”

Jens Nielsen joins John Carney today in The Real Estate Locker Room to talk about the real estate syndication process.

Key Points:

  1. Attend industry events to grow your business.
  2. Network! Meet people who have similar goals. Real estate is a social business.
  3. Create a partnership; decide on the allocation of duties with the goal of generating profit.
  4. Syndication is a good way to receive tax benefits, deductions, and it’s a good way to break into the real estate market.

Favorite Sport:

  • Cycling – Road biking and mountain biking.

Favorite Books:

Pro tip:

  • Business: Spend some time doing things that will help get your business moving forward instead of reacting.
  • Cycling: Hours of training.

 Reach Out to Jens Nielsen

Thank you Jens for taking the time to share your syndication and networking experience with the audience.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2020

 

 

 

JC 087: Real Estate Development Syndication with Dr. Adam Gower

April 1st, 2020 | no comments

How to Become a Leader of the Crowd

Dr. Adam Gower is a seasoned real estate pro and the author of Leader of the Crowd. His real estate career began in 1982 while working for an electrician pulling wires and crawling around in basements and attics in San Diego. Adam took an interest in real estate finance and started raising money for a developer. He successfully raised over $30 million in equity (1980’s dollars) and invested it all in developing hundreds of units in California.

Dr. Gower has built one of the best-of-class digital marketing platforms for real estate developers for that they are able to syndicate their deal equity online. Each system is customized to a unique offering and by digitizing existing investment solicitation processes; one can automate their capital raising efforts while remaining focused on sourcing deals and building projects.

Dr. Adam Gower joins John Carney today in The Real Estate Locker Room to discuss how to invest your money in real estate.

Key Points:

  1. You can get your hands dirty and buy physical real estate or act as a passive investor with those who get their hands dirty.
  2. Now is a good time to “keep the powder dry”, keep an eye on the market and do not succumb to the temptation of thinking everyone is making money in real estate.
  3. Get familiar and identify the sponsors who are out there, see how they are educating investors and be patient.
  4. You must have low debt. Debt will whip out any deal.
  5. You must have a presence on social media, make connections and educate prospects with a narrative. This will make you stand out and put you ahead of the crowd.

Favorite Sport:

  • Football – “The round ball football”

Favorite Athlete:

  • Manchester City – England

Favorite Books:

Pro tip(s):

  • You get what you pay for.
  • Be careful what you put your name to.

Resources Mentioned:

Reach Out to Dr. Adam Gower

Thank you, Dr. Adam Gower, for taking the time to share real estate cycles and investments with the audience.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

Connect with John Carney
Facebook: @JohnCarneyOnline
Twitter: @John_M_Carney
Instagram: @johnm_carney

© John Carney 2020

 

JC 025: 3 Keys to Real Estate – Scale, Value and Risk with Ike Mutabanna

September 13th, 2017 | no comments

Learn how to penetrate new real estate markets

JC 025: 3 Keys to Real Estate – Scale, Value and Risk with Ike MutabannaIke Mutabanna is a real estate entrepreneur and the president of Dallas, Texas based IHM Business Group. Ike also hosts the successful podcast, “The Side Business Show,” where listeners learn how to grow their wealth through running a wide variety of side businesses.

Over the last 15 years Ike has spent time as co-founder, president and CTO in a variety of startups and turnaround companies. He’s originally from India where he attended the University of Bombay, India and earned his BE degree. Ike also has a MS degree in Engineering from the University of Cincinnati.

Ike is an active commercial real estate investor and multifamily syndicator. In his downtime you will find Ike pursuing his newfound passion for mountain climbing, having recently started training for technical climbs on rock cliffs.

The 3X advantages of syndication versus single-family investment:

1) Risk diversification is much better in a ten-unit apartment building versus three single-family houses.

2) Economies of scale is better in terms of net income. The more net income allows you to hire property managers, allowing you to focus your time and energy on further investments.

3) Value appreciation – you have the ability to force appreciation with creative strategies to increase rent and overall income and push the value of your properties.

Five key points:

  1. When investing instate you have the definite advantages of knowing your local market and the ability to study that market in depth, without needing to rely on other people to relay information. You can easily build networks by attending meetups and creating partnerships.
  2. When investing out of state it is essential to take the time to build a trusted and solid team before proceeding with investments.

 

  1. Take advantage of your opportunities when you are investing instate: visit neighborhoods personally, study the local markets, take detailed notes and photos of different neighborhoods and create a thorough database which you can easily refer to when looking into new investment opportunities.

 

  1. Multifamily syndication provides the opportunity for much larger scale where investors can achieve larger returns on their investment

 

  1. It is important to find an activity outside of your business that inspires you and that will assist in training your mind and help you maintain an energetic and motivated state. You then transfer that energy back into your business.

Favorite athlete: Sunil “Sunny” Gavaskar – Famous Indian cricket player.

Learn about the game of cricket here: https://en.wikipedia.org/wiki/Cricket

Favorite books:

Favorite quote: “When you want something really, really bad and you take the action to achieve it, the universe comes together to help you achieve it.” The Alchemist – Paulo Coelho.

Check out The Side Business Show podcasts and contact Ike here: www.thesidebusinessshow.com

or podcast: thesidebusiness.show

Thank you Ike for taking the time to share your story and business insight with us.

Listen to all the episodes of The Real Estate Locker Room Show and sign up for my FREE monthly newsletter at www.johncarneyonline.com

 

POST GAME REPORT: Episode Transcript

JC 025: 3 Keys to Real Estate; Scale, Value and Risk with Ike Mutabanna

Learn how to penetrate new real estate markets

Announcer: Welcome to the, “Real Estate Locker Room Show” with John Carney. Did you know investing in real estate is a team sport? Join John and his guests as they explore the business of real estate and athletic competition. The goal for this show is to grant you direct access to the real estate pros that are closing profitable deals and growing their businesses. On the “Real Estate Locker Room Show” we are getting in the ring with successful investors, developers, operators, and all of the industry professionals to learn what it takes to achieve on-going success. Now it’s time to kick-off and level up with new ways to grow your real estate business.

John Carney: Welcome back to the Real Estate Locker Room Show everybody. I’m your host John Carney, coming at you from my office here on the sunny Westside of Cleveland, Ohio this fantastic Monday afternoon in the month of August. We are going to be talking to a real estate investor and entrepreneur Ikbal Mutabanna, who is on the line and joining us in The Locker Room from Texas. But before we get into that I just want to remind you: the purpose of The Real Estate Locker Room Show is to help you as an investor or a real estate professional who supports the industry in some capacity, or someone who’s looking to break into real estate — we really want you to be able to: number one, recruit the best team of professionals that you can to work with you; to position yourself for success and really elevate your real estate game.

The person who we’re going to be talking with has definitely done that. We met through networking. Here you go, I’m up in Ohio and being connected to Ike and his business partners from Texas and Colorado. So that is just a matter of being in the game and participating in networking events I suppose. But anyways, welcome to the locker room Ike.

Ike Mutabanna: Hey, thank you John. I’m excited to be here.

John Carney: Yea. I’m stoked to have you. So, let me just let the audience know a little bit about you. Ike is his nickname, but Ikbal Mutabanna is the president of IHM Business Group. His previous business ventures include strategic technology services, commercial real estate syndication and multifamily acquisition. Ike is also the host of a podcast called The Side Business Show, where listeners learn how to build wealth through a variety of side businesses, regardless of whether they are full time employees, stay at home mums or students.

Previously, Ike spent 15 years as co-founder, president and CTO in a variety of startups and turnaround companies. He earned his MS degree in engineering from the University of Cincinnati and a BE degree from the University of Bombay in India. Ike enjoys mountain climbing and has recently started training for technical climbs on rock cliffs. He lives in Dallas, Texas with his wife and two beautiful children.

Alright, so let’s get into it Ike. Not only are you an entrepreneur on the technology side and experienced business operator, but you’re also a real estate investor.

Ike Mutabanna: I am.

John Carney: Well, before we get into everything that you’re doing real estate related I like to warm up on the show and just get the conversation going with a few sports related questions. Do you have a favorite athlete that you looked up to as a kid?

Ike Mutabanna: As a kid, that’s a good question. Yes, there was actually. The only caveat that I will say John is that, because I grew up in India, some of the sports played there are different than the sports that we are familiar with in the U.S. So you being — having lived in Australia you’re probably familiar with cricket and field hockey.

John Carney: I am definitely familiar with cricket and my wife is a huge fan, so I’m into the test match cricket.

Ike Mutabanna: Right, right. So as far as cricket is concerned, there was a very famous — so cricket, for those of our listeners who don’t know what that is, it’s a game very similar to baseball, just a slightly different shaped bat and a ball that is made of living material, and a few different rules.

But we have an Indian player when I was growing up by the name of Sunil Gavaskar, also known as Sunny, who scored the highest number of runs in cricket at that time. He was later, of course, his records are broken about 15, 20 years later, but while growing up he was my idol in a sense. Not just for the game but also for his sportsmanship and his gentlemanly conduct in everything he did.

John Carney: You know, for the audience who — I know we have global listeners out there — but for the audience here in the states or North America who’s not familiar with cricket, it is a gentleman’s sport. But don’t take that as — these balls are travelling incredibly fast right at you. And they spin, right?

Ike Mutabanna: Yea they spin. I mean the spin is I think far more than I’ve seen in baseball, just because of the fact that it also bounces before it hits the batter.

John Carney: I just don’t see myself getting padded up and in the nets in front of a fast bowler anytime in my life.

Ike Mutabanna: Yea, I’ve done that, I’ve been hit quite a few times so I like the field now.

John Carney: So, you grew up playing organized cricket when you were living in India?

Ike Mutabanna: Well, it’s interesting, even though cricket was a very prevalent game in India, it still is, in fact, it’s considered to be the second biggest religion in India, after Hinduism. The reality is when I was growing up, India was actually the champion in world field hockey so that’s the game that I played most when I was growing up.

John Carney: Which, now you’re in North America, and it’s really, we’re an ice hockey culture.

Ike Mutabanna: We’re an ice hockey culture, exactly. So I watch ice hockey, it’s similar. Different enough that I don’t necessarily follow it anymore. But yea, that was I think my passion all the way until college and then it fell apart once I left college.

John Carney: Alright, well thank you for sharing that history of growing up in a foreign country with our audience and bringing a new sport to the forefront of the conversations we have here in The Locker Room, and we’ll make sure that we link in plenty of stuff related to Sully and cricket in the show notes.

Alright, so real estate: we were talking when we met here in Cleveland about your past work experience. You lived in Indonesia and worked in technology startups and now you’re here in the United States. You went to school in Ohio and got an advanced degree and real estate is something that you’re pursuing.

So why don’t you give the audience the ten-thousand-foot view of what you do in the real estate game?

Ike Mutabanna: Sure. So I started real estate in a very small fashion about three or four years ago. I used to live in Boston, Massachusetts and, you know, like most people in this industry who first — who are not from real estate backgrounds — their first instinct is to go buy a single-family house that they can rent out. Or a duplex. And that’s pretty much what I did for a couple of years. Never really made that much of a profit from doing that, because generally the financial economics of that doesn’t work out too well. Your vacancy can hit you if you have vacant periods, when there’s turnover of tenants you tend to then get hit by all of the changes and the maintenance things that you have to do in the house. So I never really took it very seriously.

But about a year and a half ago, when I had moved to Dallas by then, I got introduced to our common friend actually, Joe Fairless, who is big in the multifamily apartment building business. And that really intrigued me, because of the economies of scale in that business. So I started studying it, I invested in a couple of those last year, and as I started doing that and studying the markets really well, it became apparent to me that that is really where real estate can achieve the kind of scale and profit and goals that you can strive after, right? Where you’re not going after the small little peanuts that you can get in the single-family world, but you’re really going after something that can build generational wealth. So that’s what intrigued me. I started going after it. And then really entered that full time at the beginning of this year.

So since then I’ve been working on syndication for large apartment complexes in DFW. I’ve got about three that I’ve invested in so far, and around the time that I started looking at expanding that portfolio is when I got introduced by my partner in Colorado to Cleveland. It just so turns out that his family is in Cleveland and we started just hearing this little buzz about Cleveland from a bunch of different sources. So that’s what brought us to Cleveland, that’s when I met you John and since then what I’ve been doing is working on expanding the network of people that we know in Cleveland, and trying to figure out how I can put in place all of the different players I need in order to be successful in the Cleveland market, considering that I’m going to be an out of state investor.

John Carney: Right, and that is — let’s talk about that. You’re in state in Texas. Are you in city? Are you in Dallas or are you looking at markets outside of Dallas?

Ike Mutabanna: Well, so far, I haven’t looked at markets outside of Dallas. The Dallas Fort Worth Metroplex itself is so massive that you can easily consider it to be equivalent to three or four different cities all meshed together. So there’s just such massive opportunities happening here that I’ve not really had the chance to look at other parts of Texas. We did briefly look into Houston, decided not to venture that at this time because, while Houston was attractive say about a few years ago, I think the dip in oil prices hit the economy pretty hard. So that doesn’t mean there are investors who are not in there, in fact there are investors in there who are actually grabbing up properties because they’ve gone done in value. I just don’t play in that particular niche. My goal is to play in the niche of looking at really stable class C plus or B type properties where we can really work on doing some amount of repositioning, but largely focus on the cash flow aspect. So we haven’t really done into Houston.

We looked at San Antonio, the market felt a bit too small but I haven’t ruled it out. In fact, just last week made a really good contact there and there’s a potential that San Antonio might be on the horizon. I did meet another person who started investing in San Antonio from California. So clearly there’s interest in that market as well.

John Carney: Yea, so. I suppose — I didn’t mean to cut you off.

Ike Mutabanna: That’s fine.

John Carney: The question that’s sort of coming to my mind is, not only are you — you’ve moved around in the United States, so you’re establishing a business in multifamily real estate in your home town at the moment, which is Dallas, right? And then you’re also looking to other markets.

So whether they’re in state or out of state, let’s talk about how you went about recruiting your team locally, and then how that translates into how to be time efficient and find the right people in another market. Because this is an important message that I’d like to get across. And I believe that you’ve got the experience to give the pro tips on how to achieve that.

Ike Mutabanna: Sure. So there’s a substantial difference between investing in state and out of state. What happens is, in in state, as I started becoming familiar with the market, really studying the market, the ability for me to be on the ground made it much more of a favorable situation, where I did not necessarily have to depend on others to confirm things for me. If I heard of a particular neighborhood which was on the upswing and there was some good developments happening there, it would be a 15, 20-minute drive for me to get out there, park my car, walk around, really study the neighborhood in detail. And I have a habit of making lots and lots of notes. Every time I go to a neighborhood I’ll sit down and I won’t carry too much, I’ll just carry my phone with me. I enjoy using Google Keep. So I’ll just start making notes, I’ll take a few photographs.

But I’ve built up a huge databank of notes of a lot of the neighborhoods in the Dallas area. And that’s something I can do on an ongoing basis, which is really helpful because that means when I get an opportunity presented, or one that I’m looking at, I don’t necessarily have to depend on a pro-forma or someone else telling me what is the potential of an area or not.

But when you go to out of state, you no longer have that luxury, right? Unless you’re willing to fly down like two or three times a month. You really don’t have the luxury to go and do that on a regular basis.

So the big difference between how I’ve been able to do things in Dallas versus when I’m targeting a place like Cleveland, is that in Dallas I’ve done a lot of the groundwork myself and now I’ve spread the word, I’ve gone and attended meetups, which again, something I can do when I’m in state but I cannot do when I’m out of state. And I’ve made a lot of contacts. I’ve also made — I’ve created partnerships with larger firms, people who are much bigger than me in this industry, and many times, rather than finding my own deals, I go participate in their deals.

Interestingly, one of the companies I partner with, they actually are not in Dallas themselves, even though one of the partners is originally from Dallas. So when they get deals it’s easy enough for me to go validate their underwriting and all of the assumptions they’ve made, to make sure that I’m comfortable with it. Again, something not so simple to do when you’re out of state.

So as far as Cleveland is concerned, we realized early on that the only way we were going to be successful is if we spent the time upfront in building out a solid team before we even took the first step of identifying and trying to evaluate a property. So in fact, to be honest, I haven’t evaluated a single property so far, from an underwriting perspective in Cleveland. All I’ve been working on is just a slow, patient process of talking to people in Cleveland, finding the right set of partners in every different area that I need. So whether it’s property managers, whether it’s brokers, whether it’s lenders, title insurance, CPAs, lawyers. We’ve just been going methodically one by one talking to people.

I did visit Cleveland for about a week, which is when you and I were able to meet up, thankfully. And that was a very instructive week because again, as I said, because of the fact that in state, while you get a really solid lay of the neighborhoods, you can’t depend on a map or someone telling you something to realize what works and what doesn’t.

While I was in Cleveland, as an example — I’m sorry if I’m rambling, do stop me so that I can focus in a particular direction you might want John — but as I was looking at the area near Case Western Reserve University, what we found was, literally after crossing three streets there was dramatic change in the nature of the neighborhood. It went from a neighborhood where I would consider under my strategy a very desirable area to buy a multi-family, to a neighborhood where I would want to stay away. And in fact we encountered police cars, when we went up and talked to them and the police officers told us to stay away from that section. We’re talking about a few streets, we’re not even talking about an entire neighborhood changing. So that’s a big disadvantage that out of state investors are going to face when investing in an area that’s not in their backyard. And it’s very important to do some groundwork but then build a really, really superb team that they can over time depend on.

John Carney: Right, you definitely want your boots on the ground, reading from the same sheet of music as you, and you want their marching orders to be clear. So I’m familiar with the area around Case, and I’ve scouted it out, and literally, you come across the wrong side of the tracks are the wrong side of the tracks.

Now I’ve done similar work to yourself, I invested and built a business around Phoenix, Arizona, based on a solid team and good relationships and limited knowledge of the area, and was successful and loved that market. But you have to have — in our case it was an investor who was also a real estate agent was our go-to guy. And he would be the first one to tell you, “No, that side of the street is no good, this side of the street is great. And I’ve got three houses here on this side of the street. Would never buy something on that side of the street.” So, that’s all sound advice as far as pros and cons for looking at your home town versus out of town. And then talk a little bit about the syndication. How does that look if I want to invest with you? Give the audience a little bit of: I wake up in the morning and work on this so that I can buy a building with this many doors.

Ike Mutabanna: So I think one of the factors about syndication is the economics of it, right? I work on syndication in the DFW area, primarily on really large properties. So mostly which is 100 doors or more. What that brings in is the kind of scale where you can not only achieve much larger returns on your investment, but you can also drive a much better return for your investors.

So one of the goals we try and do is that we try and ensure that we can return a certain amount of cash flow back to investors which we give them as a preferred return, and our goal is to try and beat what they would have got from alternative sources. So when most investors, sophisticated ones, when they talk to us the first thing they’ll say is, “Why can’t I just put this in a hedge fund or put this in an XYZ mutual fund where I can easily get 5, 6 or 7 percent returns?”

The argument that we have to be able to provide them is that not only can we exceed that, but the fact is that this is being backed up by a hard asset. So it’s very important for that to be an asset that is truly valuable.

Now many investors, when they get into syndication, there’s a different strategy that people will follow, right? Because of the fact that we follow a very cash flow driven philosophy, we don’t necessarily look at appreciation from a very wide angle. We don’t go after really large appreciation. So we stay away from properties where there is speculation that there might be five, six, seven times growth. Usually what happens in those cases is that either the market is severely undervalued because of some reason that we don’t necessarily know yet, or it’s in a neighborhood where there is a speculative element telling you that appreciation is going to happen but you have no way of knowing.

On the other hand when you go to a more conservative underwriting technique, where you say that we think we can get 2x or 2.5x multiple on this property, but we can drive 10% cash flow returns, well now that becomes very attractive. Because we’re not promising you that for every 50k you put in you’re going to get 150 or 200k back, but what we are saying that is that on a yearly basis we’re going to be able to return 10% back to you, which in most markets is a fantastic return. You know, you’ll be lucky if in certain places you can get even five or six percent, which usually matches what aggressive investors can get in the stock market or in hedge funds.

So our syndication philosophy is very much driven around finding properties that are larger scale, 100 plus doors, in fact almost every one I’ve done is 200 plus doors. And where we can — our underwriting can be conservative enough that we can promise, not promise, but rather where we can project, very conservatively, that we can return the capital with ten percent returns on a yearly cash basis, as well as potentially reach a 2x multiple.

John Carney: That all makes sense to me. And I’ll sort of come back at you with my summary. My question being, do you bring improving the property and raising the rents, right? You didn’t mention that, but is that part of your overall strategy?

Ike Mutabanna: Absolutely.

John Carney: Okay.

Ike Mutabanna: Absolutely. That’s always part of the strategy John. The extent to which you can achieve that can vary, our goal is always to find properties that are — where the rents are some percentage below what the market can bear. And one of the things that we try to keep in mind is that when we project our financials on the basis of doing the rehab and the renovations for repositioning, that we’re not projecting that we’re going to go try to match the market, we’re just going to try and improve the rents to come close to the market but still stay below. Because that’s what insures that we’re left with some buffer to deal with market fluctuations.

John Carney: So to recap: you’re finding units, your sweet spots, plus or minus 200 doors. You’re not trying to set a record in that area for the highest rent, what you’re trying to do is find undervalued properties that are undervalued by rent and fix those up and improve the multiples so that your investors get a preferred return and then you can scale the business model by replicating it. Would you say that’s accurate?

Ike Mutabanna: That’s a great recap.

John Carney: So we just acquired a large asset. It was a complex capital stack. Having a seat at the table through this entire process from the day we first went and looked at this building, until where we are now, under construction building 29 units out. That’s almost coming up on a year for the work.

But I would throw this back out to you and the listeners: once you have been invited into a multifamily deal that’s a little bit more complicated than your standard single family home transaction, you’ll learn that with the right team in place you can go back out and do it again. Would you second that?

Ike Mutabanna: Absolutely. You do it once. The first time is definitely frightening. It’s also really, really hard. I think a lot of people under — they don’t realize how hard it can be to convince investors when you’re doing it for the first time. But once you’re over that hurdle; you’ve learned the business; you’ve learned how your entire process flows; you’ve learned the language, you’ve learned how you’re able to communicate with investors, what you can and cannot say. It starts becoming a lot more second nature to you the next time around. And you just get better every time. And you keep learning as well.

John Carney: So let’s carry that thought on and — I’m going to pick your brain here for just another couple of minutes before we wind this up — but three tips that you could give a listener or someone who, if you’re approaching an investor, what would be — sorry I’m a little all over the shop.

I’m just going to pick a number out and say $50,000, or maybe I’m too high, maybe $25,000 can get you a seat at the table. Talk about the three advantages of being in real estate through the syndication model. Especially if this is something that you want to pursue as a career. You have to get started and you have to learn somehow. So why not get started now with someone like yourself? So what are the three advantages that you can offer up to the listeners that would say, “Hey, think big, play big and this is why?”

Ike Mutabanna: Sure. So I would say that the first thing is almost self-evident, which is the economies of scale. There is absolutely no chance that in the single-family world you are going to achieve the kind of scale that you can achieve in multifamily. And the scale goes in many different directions, right? It’s not just in terms of the net income that you can derive, but it’s also the risk. When you have three single family houses versus a ten-unit apartment building, your risk is diversified in a far better way than when you have those three houses. So the risk diversification.

There’s better economies of scale in terms of net income, there’s also economy of scale in terms of the cost, right? How you manage the cost. Once you start going into larger size properties in multifamily, you find it easier to be able to afford to have property managers who can manage things for you where you’re just more of in a supervisory role. That makes it easier for you to start than once you’ve done one to go to another, because you’re not managing everything yourself. When your single-family world, unless you amass a really large portfolio of maybe 10, 15, 20 properties, you necessarily may not want to hire a property manager to do it for you because that then cuts into the little income that you’re making anyway on those. So those are the big advantages that I would talk about.

The other interesting advantage that you would see in multifamily is that, unlike single family, where the valuation of a single family, which is dependent on the market comps, in the case of multifamily it actually depends on the rental income that you can drive. Which means you can force appreciation. So if you can come up with creative ways in which you can increase rent, you can increase overall income, you can force appreciation in the valuation of that property, which is something that is phenomenal. What other asset can you think of where you can actually decide how much — and as long as, of course, certain parameters are fulfilled where you can push the values up by actively doing things in that property. So I would say risk mitigation, economies of scale and value appreciation. Three really solid reasons why multi family is a far superior asset.

 

John Carney: I love it. Great advice and thanks for coming up with those quickly on the spot Ike. Well I wrap this up with what I like to call the two-minute drill. And these are just a couple of questions I’m going to throw at you rapid fire.

Are you a reader? And if so do you have a favorite business book or non-fiction book that you’ve read more than once or you made some notes in that you keep on your desk and refer to from time to time?

 

Ike Mutabanna: Yea I’m a reader. A very avid reader. I’ll mention two books. One is non-fiction and one is a fiction but which has a lot of — it’s really influenced me a lot in my business life. The non-fiction is a very old book by Dale Carnegie called “How to Influence People.” Really old book, some of the things in there might sound outdated, but the underlying principles are really solid. And they relate to always having what he calls a “you” attitude. When you’re working with someone how do you do something for them is what you should be thinking about, because when you do that, it all comes around eventually.

The other really awesome book that I’ve kept close to me is called “The Alchemist” by Paulo Coelho. Even though that book is a fiction book, it’s usually coded more in the circles of people who like to read books that sound spiritual in nature. It is spiritual and it has helped me from that perspective. But it has also helped me motivate and inspire myself in what I’m doing. There’s a very interesting sentence in there which I’m going to paraphrase. It says, “when you want something really, really bad and you take the action to achieve it, the universe comes together to help you achieve it.” Which I think is fantastic. It’s a phenomenal way to think about something.

 

John Carney: So I’m going to use that in the show notes as your favorite quote. And I like that. I mean, I don’t know, there’s a lot of good motivational sayings that come from business leaders and athletes alike about overcoming the odds and the obstacles, and I think I’m kind of looking back now, some of the people I follow, on my social media threads are quoting the stoics.

So nothing is outdated because guys like Marcus Aurelius were writing this down a long long time ago and it’s pretty relevant to life and business today, right?

 

Ike Mutabanna: True, very true.

 

John Carney: Okay. Well one last question. How do you train for success? You’ve moved around the world, you’re a successful person, you know how to recruit a team. But how does that look like? How do you achieve that consistently?

 

Ike Mutabanna: I think what I try to do is always take up one activity that is not related to my business which I take up as a passion activity. Something that I put a lot of energy and effort into and that usually helps me train my mind to stay in that super energetic state, which then transfers into my work and business as well. So what I’ve recently started doing is — I mean I’ve always been an avid mountain climber, I’ve never really done any kind of technical climbs, it’s usually just been putting on my hiking boots and going with a bunch of friends and trying climbing whatever peaks are accessible. But about a year ago, I started realizing that if I really wanted to scale some heights here I needed to learn how to do technical climbs. And so then I went ahead and joined this local group that does a lot of technical climbs and they have beginner’s groups as well. So I’ve started doing that, it’s very early stage yet, but my goal is within a year’s time to get to a point where I can go climb at least one intermediate level peak in the U.S. which involves some amount of rock climbing.

 

John Carney: That’s a great goal. That’s a highly — you have to be very highly focused and strong to scale intermediate level fixed rope climbs. So I mean, I wish you the best of luck in learning that, and not that you won’t achieve it, but that’s going to be a practice. It takes mental and physical discipline to build up that stamina to be good at it. I lived in Colorado for a number of years, I was never a fixed rope mountain climbing type person. There’s so many sports and activities available out there that that just wasn’t one that I fell into but when I see photos of the people I know standing on top of these spires, it’s awe-inspiring. So that is great, thank you for sharing that.

Alright, well there you have it folks. I truly hoped that you picked up some actionable advice today from my conversation with Ike. And I want to thank Ike for taking the time out of his busy day to join us in The Locker Room. Where can our audience find you if they are interested in following you online or maybe even connecting with you to talk about syndication opportunities?

 

Ike Mutabanna: Sure. I think the easiest way is to go to my podcast website: it’s called thesidebusiness.show. You could also go to thesidebusinessshow.com and it has both my podcasts and also my contact information on it. I’d love to hear from your listeners.

 

John Carney: Perfect. You’ll be easy to find then. Alright. There we are.

Make sure that you check out the Real Estate Locker Room Show on iTunes, Stitcher or Google Play and hit that subscribe button to ensure that you never miss out on the pro tips from our great guests like Ike.

The mission here once again is to help you elevate your real estate game and be successful. If you like what this show is all about, I’d be grateful if you would leave us a five-star review on iTunes, Stitcher or your preferred podcast platform so that other like-minded real estate professionals and people just like you can find us when they are searching for real estate shows.

The post-game report show notes, links and additional content related to this show, specifically to the wonderful world of cricket, will be available on my website: johncarneyonline.com/podcast, and while you are there feel free to drop your email into the newsletter sign up form and you’ll occasionally receive some real estate investing insights, tips, tricks, hacks and useful tools from me.

Remember to stay focused on your goals, have fun and stay in the game. I’m your host John Carney and until next week, please remember to work hard, play hard and profit hard in your real estate game.

One more time, really thankful for you taking the time out of your busy day Ike to share your story of success.

Ike Mutabanna: My pleasure John. Thanks for inviting me.

(Music Out)

End Audio

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© John Carney 2017

JC 004: Reed Goossens is the Australian dominating the US multifamily market

April 3rd, 2017 | no comments

Meet the Australian real estate investor who’s living the American Dream

In 2012 Reed Goossens packed his bags and left Australia to pursue his dream of living in New York City. He hit the ground in the Big Apple hustling and networking.

Today Reed is living the American Dream and pursuing financial independence as real estate entrepreneur who syndicated multifamily deals across the county.

Learn how horse jumping, rugby and surfing provided the Reed the confidence and discipline to successfully pursue any goal.

Reed attributes his rapid success in the apartment syndication business to having a mentor, a coach and partnering with investors who already had a successful track record.

Now Reed helps investors get started in US multifamily real estate and hosts the podcast, “Investing in the U.S. – An Aussies Guide to U.S. Real Estate”

Favorite quote, “Don’t give up” – Winston Churchill

Reed’s recommended reading list;

  1. How to Win Friends and Influence People by Dale Carnegie
  2. Rich Dad, Poor Dad by Robert Kiyosaki – www.richdad.com
  3. The 4 Hour Work Week by Tim Ferris – http://www.fourhourworkweek.com

Favorite Athletes

  1. Favorite U.S. athlete – Michael Phelps – Swimmer, multiple world record holder
  2. Favorite Australian athlete – Steven Bradbury Speed Skater
  3. Favorite athlete – Usain Bolt – Sprinter

Reed’s #1 tip for success is to get a mentor and surround yourself with successful people.

Thank you Reed for taking the time to share your story with my audience.

Visit Reed’s website www.rsnpropertygroup.com  or email him direct Reed@rmspropertygroup.com

Follow Reed on Facebook and Twitter

 

POST GAME REPORT: Episode Transcript

The Real Estate Locker Room Show Podcast

JC 004: Reed Goossens is the Australian dominating the US multifamily market

Announcer: Welcome to the, “Real Estate Locker Room Show” with John Carney. Did you know investing in real estate is a team sport? Join John and his guests as they explore the business of real estate and athletic competition. The goal for this show is to grant you direct access to the real estate pros that are closing profitable deals and growing their businesses. On the “Real Estate Locker Room Show” we are getting in the ring with successful investors, developers, operators, and all of the industry professionals to learn what it takes to achieve on-going success. Now it’s time to kick-off and level up with new ways to grow your real estate business.

John Carney: Welcome to the Real Estate Locker Room Show. I’m your host John Carney and today we have lined up another great episode. We’re talking to international real estate investor Reed Goossens. Reed is an Australian currently living in Los Angeles California. He’s going to tell us his story f
rom going from no American real estate ownership to an interest in over 866 doors. He’s a multi-family investor. He’s the host of the podcasts Investing In The U.S. and An Aussie’s Guide to U.S. Real Estate. and all around good bloke. Reed moved to the U.S. in 2012 to pursue a career in structural engineering. However, he discovered a passion for real estate investing. With limited funds, and zero credit Reed went from purchasing a small duplex to growing his own real estate investing firm, RSN Property Group. Since 2012 Reed has been involved in over $50 million worth of multi-family syndication. That is excellent. Reed lives up to a never say die Aussie attitude when it comes to being a successful entrepreneur. So, Reed you are sitting in the Real Estate Locker Room. Before we get into your awesome story we’re going to offer you up a stretching question. A sports related question of course. Who is your favorite American athlete?

Reed Goossens: Oooohhhh, that’s a good one. My favorite American athlete? I think I would have to go with Michael Phelps. I’m a pretty big swimmer myself, growing up in Australia. You know, as you know mate, we all like swim and get wet in the pool. And yeah, just incredible, what? Won 22 gold medals was it? I can even, I lost count. The last Olympics was pretty incredible to watch and get back in the pool. So, Michael Phelps would be my #1 U.S. athlete.

John Carney: Yep. He’s had an amazing career of ups and downs. He definitely has that never quit mentality that champions have.

Reed Goossens: Exactly, exactly.

John Carney: Just so, you know, I lived in Australia, as you know, for seven years. Just recently moved back to the U.S.A. and when I was over there I was introduced to all of your sports. The one guy that I fell in love with is Steven Brandary, Bradbury.
Only because for listeners out there. I’m going to put in the show notes. A note here to put in the show notes, is a link to who this guy is. But, I mean, he’s an Australian speed skater that is not a popular sport in Australia, by the way.

Reed Goossens: There’s a ton of ice in Australia right?

John Carney: Yeah, right, there’s no ice in Australia. Talk about being put in a position to be successful. It was the winter games back in 2012, if I’m correct? Hopefully. There was a Winter Games in 2012. But anyways, he was in the gold medal final round and I believe there were four other competitors. And the lead skater on the last lap beat it in. And took out the two trailing ones. So, the fourth-place guy, you know, was in it to win it. And he crossed the finish line first, gold medal. It’s an amazing success story. So, any comment on that Reed?

Reed Goossens: Right. He is. I remember watching it. I don’t think it was 2012? I think it was earlier. Because I was a little bit younger. And 2012 was the Olympic Game is London, I think it was? So the funny thing was, he did that, that same thing happened in the heats. If you read into the story like. It wasn’t just in the final, flipped over and he skated across the finish line. Coming dead last and then all of a sudden then coming in first. He did it in one of the heats as well. Which is, it’s incredible. He won the gold and a lot of people were not very happy about it. Well hey, you got to be in it to win it right?

John Carney: Absolutely. With that being said, let’s get into this interview. Let me ask ya, why real estate Reed? And how’d you get started?

Reed Goossens: Sure thing, and you know, I want to say, this is awesome and well done for putting on this show. The Real Estate Locker Room is a really, really, cool concept. And I think you’re going to get a lot of awesome listeners and the name is so catchy. So, well done to you. The reason why I got involved in real estate? Was two fold. One, was I just graduated from the University in 2007 and I’d been backpacking around the world for about 18 months I looked at myself and said, I can’t be sitting in this cubical for the rest of my life. I just can’t be 40 years, 50 years. Get a retirement package, and then retire. I felt like a very small cog, a part of a very big machine, which was corporate Australia at the time. So, I really was felt like I wanted to give, like I had more to give. I was very entrepreneurial. But I didn’t know where to place my energy. I remember attending a Amway pyramid scheme sort of thing and that just wasn’t for me. And it was my dad that said to me, you should try and place some capital in some real estate. You’re in engineering, you’re a civil engineer. You surround yourself with real estate every day. And that right there was the little trigger that got it started. Making me look at things a little differently from that point on. In 2009 I picked up a book, “Rich Dad, Poor Dad.” by Robert Kiyosaki. I’m sure a lot of your listeners will be influenced by that particular gentleman. He has influenced a lot of my guest on my show. And has had some huge success. In that book really, you know, materialized what it meant to be a real estate investor. And I just, you know, took that book with, you know, it was with both arms and went forward leaps and bounds I was attending as much real estate investing networking classes as I could. And it was really understanding the asset that is real estate investing. And for all our listeners out there the reason I love real estate is because there is no other investment across the world anywhere across the world that offers the four ways to make money. And that is, that real estate has cash flow. And amortization, which is the pay down of the principle in a particular property because your tenants are paying down the debt. You have appreciation, and there are five forms of appreciation, I won’t get into those. But, there are five forms. And you have the tax benefits. So comparing that to a stock investment, it just makes so much more sense. I have control over my asset. That really is the power to me and why I love investing in real estate.

John Carney: “Rich Dad, Poor Dad” obviously a book that I read and I keep it close by. Because it’s still has notes in it. I haven’t looked at it for a few years, but I mean, you know, it’s one of my. I’ve got a stack of books in my office sitting behind that I keep as references. They have notes and everything. You just never know when you’re going to have to return to that. Look, I like to draw the comparison between what it takes to be a professional elite athlete because there’s a certain amount of dedication. You touched on that, you were educating yourself, became dedicated to learning how to become a real estate investor. And so, on this show, we’re exploring that crossroads where we have the intersection, sports and real estate. Growing-up did you have an athletic background? Was there anything you learned playing sports as a kid or participating in any sports now as an adult that helps you? That helps you along the way in real estate?

Reed Goossens: Yeah, that’s actually quite a good question? And a lot of people don’t know, this about me, that when I was growing-up, I was hugely into horses. I was riding show jumping actually. My parents, who were actually teachers. I don’t know how they afforded it, but we had a team of horses, we went around the country. Being in show jumping, it’s a very, it takes a lot of dedication and time. Getting up at [5:30]AM every morning. Dealing with horses, mucking out stables, feedings, grooming, all that sort of stuff. And having an animal that is your responsibility to them essentially. If it’s not working at it’s peak you’re not going to be able to jump as best you can. Because the horse is whatever, feeling tired or lethargic. And so that there, for me, a young age it was very much instilled in me to have dedication, to have drive, to have passion, for what you do. And I think that if you put your mind to anything especially particularly real estate. And how does this related to real estate investing? Not everyone is born with ten years worth of credibility in real estate investing. I certainly wasn’t. But I actively was wanting a goal to achieve, and that was the financial freedom. And I wasn’t going to give up until I got there. And I actively pursued educating myself on real estate. In life with my show jumping you know, I was actively trying to become a better horse rider, every single day in and day out. And if you continue to put your mindset to that, and have a goal and you’re laser focused on that goal, that I think it’s very, very, likely that you’re going to achieve that goal. So sporting was definitely a huge part of my growing up. I played Rugby, I swam, I surfed. I went to Nippers. And for all of the Americans, out there who don’t know what Nippers is, it’s just sort of surf like savings for kids. Sports had a huge impact on me growing up and it has shaped me into the adult that I am today. And it has definitely shaped me into the person that is you very driven about what I do. And I thank God for the goals I set and how I achieve them.

John Carney: We have young children now. It’s really, really interesting watching them play and develop. I can’t wait until they fall into. We want to expose them to a lot of sports. Because I believe that, that does instill a certain amount of, discipline that’s required and you kinda carry through school and through life. So can you tell our audience what you’re working on right now that’s getting you out of bed in the morning excited and you are laser focused on. And bring us up to date. You arrived in the United States. You own no property, right. Now, you have an interest in a substantial portfolio. Can you give us a little bit of that story and the time line. You know, we kind of kick this off in 2012. You know, we’re ¾ of the way through 2016 now, close the gap for us.

Reed Goossens: Sure thing. So to rewind a little bit more than that. It was 2009 and I educating myself for a couple of years in Australia. Very, very, close to pulling the trigger in Australia. It was a flip or something in Aussie that I wanted to invest in, maybe split a block and I was very close to pulling the trigger and saved a bit of money. At the time, my girlfriend who was American, was studying in Australia. She had finished up her studies and I really, really, wanted to move to New York City. Because I felt New York City, is in terms of business, in terms of growth, it just had this feel to me when I was backpacking through there in ’08. That I just had to live in this particular city for a period of time. Early in 2012, we packed up all our stuff and we moved across the world. We rocked up in the United States and I didn’t have a job and I was on a tourist visa. And I just pounded the streets, untill I found one. I found one as a structural engineer and up until a year ago, 18 months ago I was a structural engineer. And within the first two weeks of me being boots on the ground in the United States in 2012 I was at my first real estate networking event. And John, I thought Australia had some awesome networking events! By gosh, the United States in the heart of New York City, in Time Square, it was like networking on steroids. I had not experienced anything like this before. And I was just so, you know, invigorated to go out and learn a lot about real estate here in the United States. You know, people don’t realize that in the U.S.A. when I first came to the United States, that the barriers to entry are a lot lower compared with Australia. You know, maybe is Aussie, I can pick-up 150 maybe 200 thousand dollar absolute heap, and try and flip it, and make a little bit of profit. Well, in the United States here, I saw that you can pick-up places for $50, 60 thousand dollars that would cashflow for you know, $200, $300, $400, dollars a month. Which was incredible. And I was just like, hang-on, this is something awesome here. And so, 2012, educating myself. And as I said, I picked up my book in ’09, and so I had been educating myself for a period of time now and I was very, very getting to the point where I was just chomping at the bit like there is only so much to learn, there’s only so much you can read. Actually get your feet wet in a deal. So, I think I had a little deal in Up State New York. It was within driving distance from New York City, Syracuse New York, is about 4 ½ hours. It was a duplex and the cash flow side of it. So, I went and purchased it. And I purchased it all in cash. When I first moved to the United States, I didn’t have any credit. You know, anyone who moves here will understand that credit is king in this country. And I couldn’t borrow. I had to pay for things all with my own cash. So, then I slowly over a period of time. I developed relationships with the local bank and I was able to refinance some money out of that deal and buy a second deal. And through that time when I bought the first deal I rearranged to the property. And we did, I spruced it up, nice new counter tops, and nothing crazy that you and I would approve of and appreciate. But something that was affordable for my tenants. And in doing so, I was able to increase the cash flow of that particular property and it was quite powerful. I increased the rent about $60-$70 bucks on the two individual units. So, it had a Gross over effect of $126.00 a month. Which was really nice, in terms of cash flow. I had done that deal and I did a second deal. I did a separate deal, it was a flip in Philadelphia and I was slowly, slowly building credit and building these little portfolios. Then it came to a point when I ran out of my own money. I just couldn’t do any more real estate. I had 3 or 4 properties. You know, very cheap properties under my belt. It in deed, maybe the portfolio was worth then $200,000 maybe $250,000. What I started to realize was hey, I need to up my game here. I saw the power of multi- family real estate. A buddy came down from Canada at the end of 2013, and we had dinner. Hey guess what I am doing? These duplexes in upstate New York. Look how good I’m Killin’ it! Reed, that’s awesome. I closed on a 70-unit apartment building in Canada. I was like, what?! How did you do that? What does that even mean? And he went on to explain the power of “The cap rate theory.” That if you force the net operating income, you can increase the cash flow for one unit. You can also force the value of the property. That was really, really, powerful for me. Because I started to see that on my smaller duplexes, even if I wasn’t forcing value, I was increasing cash flow. And the key was commercial real estate. You have to get involved in commercial real estate. But, you know, commercial real estate is a lot more expensive. Instead of buying two duplex, you might be buying a hundred units or 50 units, or whatever it might be? But I saw the economy as scale there. That if I could apply what I was doing on the duplexes to the large multi-families then I would be able to build a huge wealth and crate a lot of passive income, a lot of cash flow at the time. So, that was sort of started my journey from 2012 to 2013. In 2014 I started RSN Property Group and I got a coach/mentor, and we definitely were on personal branding. And getting into the day, people will invest in your deal because they invest in you. The deal might not necessarily matter than much. They actually invest in you because they trust you. You have credibility with them. So, how do you build credibility without being born with it? Well, there’s a number of ways. I know John, you’re an expert at it, as well, writing a book. Or being a key person of influence in your sphere. And there are those difficult things that you can do to brand yourself in a certain way that will attract real estate investors. And over a period of the last 18 months I’ve been able to get involved in I think 866 units and I have an equity stake in all those. And I’ve been able to raise a bunch of capital. And I’m slowly building towards something awesome. And you know, my journey is not over, by no means, it’s only just getting started. And I want to continue to grow my portfolio and continue to buy as many multi-family real estate properties as I possibly can. So, that’s caught everyone up to date a little. It’s a bit of a journey, but it’s certainly a lot of fun along the way.

John Carney: Yeah, that’s a great story. And I believe it’s common at least from my experience. In surrounding yourself with the right people, right? I mean, you’re the average of the people you meet and choose to hang out with. And with the common interest you’re with these real estate people now, through networking, right? And you’ve grown into the investor you are today and with the sights on growing more. You know, I talk to a lot of first time investors and help people get started in the game. I always start by recruiting the team when I go to new markets. I want to touch on your team. But, I think it’s an important to note what you just said, starting zero properties. That first rental which you had to drive 8 hours round trip to get to and then you just turn the clock forward a few years, all the blood, sweat, and tears turns into 866 doors. So, I mean, that’s just a great story. You know, that is the American dream isn’t it, Reed?

Reed Goossens: Right,

John Carney: you’re living it.

Reed Goossens: Exactly.

John: Leading by example. So, you know, I’m a big believer in growing into who you are today, it doesn’t happen overnight and if you set your sights, continue to set your sights higher and raise that bar you will continue to grow. So, awesome, thank you for sharing that part of your story. So, you know, I just moved back from Australia to Cleveland. I haven’t lived in Cleveland for 19 years. It’s a completely different city and we won’t go on about how expensive real estate is in Australia. I had to get the lay of the land here and I was able to do it pretty quickly. For the last 120 days I’ve really been figuring it out and running the numbers and doing the math to define where my next acquisition is going to be. But, you know, it also requires putting together the right team.

Reed Goossens: Exactly.

John Carney: So I want you to talk a little bit about how you went about assembling your team that supports you. What it means to you, and you know, aside from you who’s driving this, you’re the quarterback. Who’s the key-player?

Reed Goossens: Yeah, that’s a good question. I think, you know, I had you on my show, a while ago. I was very taken. Very impressed by what your show produced. Enjoying you book about real estate is a team sport. That really resonated with me, that is completely true. The key-players on my team are a couple of other syndicators. I can name, names, I don’t have to name, names, it doesn’t really matter. But, the power of understanding that you not, in real estate you can’t do it by yourself. And on particularly on large multi-family units you can’t go and raise all the capital. You can’t go and find the deal. You can’t do the PPM. You can’t go and do the financing all by yourself. So, splitting it up amongst people who are capable of raising the capital. Capable of getting financing. Capable of finding deals. That’s really, really, important. And you know, if yes, I have an equity stake in 866 units. But, we all do. And so without the team we wouldn’t have gotten to that amount of units so quickly. If it was just me, Reed Goossens doing it by myself, I wouldn’t have been able to scale as quickly. And that’s really important to the listeners out there. Surround yourself with the right credible people, get a mentor, get a coach. Then work on your personal brand and understand that you’re not going to be able to do this by yourself. And it’s okay to use other people and leverage other people’s skills and abilities to help you scale your portfolio. So, I think that is really important, in my investing career, having a coach and getting a mentor is, without them I was, first started leveraging their ability. They had done some deals. And I leveraged their experience to then go and show my investors. To say, “Hey, I’m partnering with these awesome guys. They’ve done “X,Y & Z” or have done a couple of deals and they’re looking to grow like I am And then all of a sudden I’ve got mentees who I mentor. And then they’re leveraging my ability to and they’re raising capital. Because I’ve been involved in 866 units in the 18 to 24 months. So the cycle goes around. I’ve got high hopes on that. I’m helping other people and continue to help other people where I can because the power of your team is very, very important.

John Carney: It definitely is and I suppose you just feel obligated, don’t ya to pay it forward, when someone comes to you. And you see the fire in their eyes and say, “Hey, you know, I’ve learned this, I can help you out.”

Reed Goossens: Sure.

John Carney: And it’s not always, you know, a lot of the times, you know, I’m always opened to directing people to the right advice. So, I mean, I think you’ve touched on it.
If you’re a rookie real estate investor who wants to break out, who wants to go, tapped out with cash and bank loans and wants to elevate their game to another level, you’re advising that they go out and find a mentor or a coach, and has the same vision as they do, and ask for help. Would you say that’s?

Reed Goossens: 100%, John. That is key, and as I touched on before, leverage a mentor or a coach helped me to get where I am today and I was able to leverage their skills and abilities. The number one thing that I like to talk about when you’re presenting a deal to an investor, a potential investor. They’re going to go say, “Well, how much experience do you have?” Well, then you’re not going to have any experience because you might not have done this before. So having a team, showing the investor that you have a team around you and that you have a great team, and a great package, and a great deal. And that goes to the core of, I trust you, I trust your credibility, I trust the team you’ve got established around you that you’re going to invest. And raising that first $100,000.00 or $150,000.00 or whatever it might be in syndication, that’s what I do, can be tough. And once you do that, it’s a little bit of a snowball effect. Like people start referring you to other clients. You start building a track record and things become a little easier. But it does take a little bit of time and effort to get that first deal done and I always like to say, that you don’t get to deal 15 without deal number 1. So, that’s my little motto.

John Carney: Right, loads of action in between. You’ve shared an incredible story. And before we get into the “2 minute drill” here. Think back really, quickly, certainly there’s a recent obstacle that had you banging your head against the locker door, so to speak. Can you share one of those stories with us?

Reed Goossens: Yeah,

John Carney: I always learn and so I’m listening with opened ears because, they are just obstacles in the way when you a real estate investor. I really enjoy learning from how others navigate those obstacles. To find their way to crush it.

Reed Goossens: Sure thing yeah so. I think the biggest one recently. And I’m going to get pretty in depth now. It’s a little bit more advanced. But, I don’t really care. Your listeners will learn a lot from this. On some recent deals that I was involved in I had raised a bunch of money and what had happened was that the deal sponsor, who was the person who comes along and essentially puts their neck on the debt, they sign on the dotted line,
didn’t want to have what was called “sophisticated investors.” And for all those people who are listening understand the FCC rules. Sophisticated investor means they are not accredited, non-credited means, you don’t earn $200,000.00 or more a year. Or you’re not worth a million bucks. So that meant a lot of my investors in the deal were walked off the table to leave a good portion of money. Like, I’m talking $500,000.00 to $600,000.00 off the table. Now, I didn’t know this till like D-Day, so it really frustrated me, that I couldn’t one, perform on what I was going to sell what I was going to do. And two, I, communication wasn’t there to say, okay, we’re only going to take accredited investors. Lesson learned. But, in saying that, I can’t then leave those investors out in the cold because you know there’s other rules in the FCC Laws that you can use on the sophisticated investors in your capital raising abilities it just meant for me as a business owner and RSN Property Group to start finding some smaller deals. I needed to start getting my other non accredited investors involved in some smaller deals and that’s why I went to Kansas City, just recently to check out a 48 unit, a 50 unit. I want to be in a place in my business where I can if someone comes to me and says, “Hey, Reed I really want to invest with you.” I love what you’re doing. I need to be able to put them in a deal and that’s just me as a business owner and to find the right deal to help them navigate the world of multi-family investing in the United States. So that’s definitely one thing that I recently had me banging my head against the wall. Lesson learned. I understood where the deal response was coming from. That meant I had to change my action in my own business and say, “hey” I need to start going out and increase my deal flow on some slightly smaller sized deals to get my sophisticated investors involved. So, that’s definitely one of them recently.

John Carney: Yeah, sounds like it’s one of those cases where you’re insanely frustrated in the moment but then it turns you’ve learned a lesson. You’ve built a system into your business and then almost, you know, the obstacle becomes the way, and you have almost come up with a solution to handle a different investor classes

Reed Goossens: Yeah, it’s definitely lesson learned as I said. I haven’t executed all on a smaller deal with my sophisticated investors yet. But I will be ready to go by the year’s end. I should have 4 or 5 or 6 of them involved in a sale of a smaller deal in the Mid-West somewhere? Just trying to find that deal right now.

John Carney: Right, you’re on a hunt. That’s the part I like.

Reed Goossens: Exactly.

John Carney: Before we wrap up the show here with a “Two-minute drill.” I’ve got ten questions and they are coming at ya starting right, now! What sport did you love playing as a kid, and the lesson, one lesson.

Reed Goossens: It probably would have been Rugby. I think the biggest lesson is that, I like my show jumping and then being in the equestrian world, that was a very individualist sport. I think being on the Rugby field, there’s 14 other guys out there slogging in the trenches. It’s a team sport, you know and that was really powerful.
My dad always said, “You got to be involved in team sports. It helps with leadership. It helps in just understanding the dynamics of other people at work.” And that is really powerful and that was a really good lesson learned over the years coming in now into my adult life.

John Carney: Number 2. What sport are you currently participating in today that you’re enjoying and lessons from that?

Reed Goossens: I still get out in the water for a surf every now and then. I really love surfing. It’s a great way to just, you know, life can be go, go, go, go and it’s just a great way to get out on a Saturday or Sunday, early before…as the sun is rising and just take a great big breath and let all the worries and stresses of the world just drift away. You know catch a few waves and just enjoy the morning. I love getting out and in particular a nice fresh still winter’s morning which is a bit more crisp and just get in the water and getting some nice waves. It always makes me feel good.

John Carney: Yeah, the cold salt water, love it and miss it. Other than Robert Kiyosaki’s “Rich Dad, Poor Dad”, do you have a favorite sports book or business book that you’ve just finished that’s on your list?

Reed Goossens: Yeah, I have one, by Dale Carnegie “How to Influence People” that one? I’ll have to send you to it? “How to talk and Influence People” something along those lines? I’ll have to send you to it? Dale Carnegie, very important book in my career. The other one I love is, “The Four Hour Work Week” by Tim Ferriss. Very, very good book. I really enjoy that book.

John Carney: What a great title.

Reed Goossens: It is, it is.

John Carney: What a way to sell books.

Reed Goossens: The four-hour work week. I mean, what I sign up?

John Carney: I know, I know. I read it. I can’t imagine that there’s an entrepreneur out there that has not read that book unless you’re well established before it was published. But, even then, I mean that is a great book. He does great work. I’m a big fan of Tim Ferris. One quote that keeps you motivated? And this can be something that doesn’t have to be from a person. It can be something that you came up with.

Reed Goossens: Yeah, one quote Winston Churchill says, “Never give up.” And that is just never, ever, give up. It doesn’t matter if the chips are down. Don’t give up, have belief in yourself as I said earlier in the show. If you continue to be laser focused on your goal, whatever that might be. It might be real estate investing or something completely different, then do it and don’t let anyone tell you otherwise until you achieve that goal. And anyone can literally achieve anything you put your mind it. So, I’m a huge believer in mindset. And if you are so motivated in it and dogged it about your approach, you’ll achieve those goals, you’ll get there.

John Carney: Thank you. What is your number one come from behind victory in real state and what did you learn from that?

Reed Goossens: Come from behind victory? I don’t know if I’ve had one yet? I had an issue with a flip in Philadelphia with the contractor. Definitely at one stage I thought the chips were down. I had done a couple of flips in Philly. I’m not going to get into the weeds but, it was some issues with the city and trying to get this thing on line and I was constantly just pouring money into it. And we did, we ended up getting it over the line. It was probably six months later than scheduled but we got it done and we got it sold for a small profit. We got our money back and I definitely thought six months earlier, geez this is going to you know, the explicit excrement is going to hit the fan. So, I definitely go to lesson’s learned on that. Flipping is not my business, it’s not my job, it was hard to manage from out of state and I definitely just needed to focus on my multi-family investments of which I have had lots of success in.

John Carney: Perfect. Alright, now we’re asking who’s your favorite athlete of all time is?

Reed Goossens: Favorite athlete of all time? I think, Usain Bolt, would have to be my favorite athlete of all time. I love his poses that he does that he does. Just the sort of grin as he’s running across the finish line, you know, ten yards in front of the next person. I think he’s a real inspirational guy. He comes from Jamaica, I just love his attitude. I just love the way he leads his life. So, really, really, inspirational for me.

John Carney: Yeah, you watch him run and blow everyone out of the water and it doesn’t even look like he’s breathing hard. I

Reed Goossens: Or he’s even trying hard. It’s like, this guy’s a freak.

John Carney: Yeah, he doesn’t sweat.

Reed Goossens: Yeah, exactly.

John Carney: What gets you into your flow state or if you need to get into the zone and focus on something? Do you have a practice that you can share?

Reed Goossens: Yeah, if I have to really focus on something and I’m sitting at home. I like to get out of my. If I have to really hit something on the head. As I say, eat the green frog” or whatever it is? You know, the first thing you don’t want to do is? First thing in the morning, I like to get up, go for an exercise and then have my breakfast and then get out of the house and go somewhere where you can concentrate. It might be a coffee shop, it might be the library and I get so much more work done when I get out of the house. Because being in the house can distract you a little bit. So, you can’t get work done as much. So, it’s just like turning off your phone, turning off your Internet and doing whatever you need to get done, done. And it’s surprising how quickly it does get done and then you’ve got that thing done and out of the way that you’re sort of regretting to do. So, it’s definitely one of those things that changing up your environment a little bit that way you’re working to be more productive.

John Carney: And would that lead into the next question? Which is, do you train for success?

Reed Goossens: Yeah. definitely, I’m a huge believer of in meditation. I love going and trying to do yoga once a week. Just to try and it’s very much like surfing, it’s therapeutic. Just like to get away from everything for a little bit and I also like to work out a lot as well because it’s another way that I can go and just a great way to start the day. It’s a great way to be energized. But it’s also a great way to keep your mind set focused, keep focused. People, there have been studies shown other people that workout live longer, they’re more healthy, they are more active and have better mindset. Being an entrepreneur you want to have all those things and you want to continue to do what you do, which is the business of real estate investing.

John Carney: Yeah, I agree with you on the working out part. My wife will see if I haven’t been to the gym in a couple of days tell me to go lift something heavy. That’s why I love her so much. All right, finally, what is your number one tip for winning more?

Reed Goossens: The number one tip for winning more? I think it would have to be is taking a page out of your book mate and as you said earlier in the show already you are only as successful as the people you surround yourself with. So, going back to what I the underlining theme of this particular episode was, get a mentor, surround yourself with successful people. That’s all, that’s my number one tip for winning.

John Carney: Awesome, can you tell me how our guest can find you if they want to continue the conversation?

Reed Goossens: Let’s do it. So, you can hit me up at – Reed@rmspropertygroup.com, or you can hit me up at my, I’m also have a Podcast, which is, as John mentioned, Investing in the U.S. Aussie. U.S. Guide to Real Estate. Educating international investors about the awesomeness of the investing in and cash flow property here in the United States. Check it out on iTunes and if you’re ever coming through L.A. please hit me up. I love hanging out for beer, or coffee, or going out for lunch. Whatever it might be, just hit me up at – Reed@rmspropertygroup.com.

John Carney: Awesome. Well there ya have it folks. I truly hope that you picked up some useful tips by tuning into today’s show. Thank you, Reed it was a pleasure having you on the show today. And I’m sure our listeners have some actionable tips that they can implement immediately. You can check out the show notes on iTunes and while you’re there, please subscribe to the podcast and we will continue to deliver awesome guests like Reed, who are crushing it, and hitting home runs here in the real estate game. You can also visit – www.johncarneyonline.com for a more comprehensive review of today’s show, in the show notes. And we look forward to bringing you another episode next week. I’m your host – John Carney and tune in next week, until then, work hard, play hard, and profit hard, thank you Reed.

Reed Goossens: Thanks mate.

John: Alright, have a good one.

[38:37]

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© John Carney 2017

JC 002: Multifamily Syndication, Teams and Giving More with Joe Fairless

March 29th, 2017 | no comments
Meet Joe Fairless; real estate investor, multifamily syndicator, philanthropist, author and host of the world’s longest running daily real estate podcast, The Best Real Estate Investing Advice Ever Show.

 

Joe started his career in advertising on Madison Avenue in New York City. He began researching real estate as a way to achieve financial independence.

In 2009 Joe began investing in single-family homes. Joe wanted to scale his real estate investment business and focused his attention on multifamily buildings and syndications as a strategy to grow bigger, faster. Now Joe controls over $85 Million in multifamily real estate.

Joe competed in baseball and football growing up and played football in college. The lesson that he learned sports that he applies to real estate every day is that when something bad happens, learn form it quickly and move on quickly.

Favorite quote, “the secret to living is giving”

Check out Joe’s book, The Best Real Estate Investing Advice Ever. Volume I

Tune in and subscribe to Joe’s podcast, Best Real Estate Investing Advice Ever Show

You can reach out to Joe directly by email to info@joefairless.com Don’t forget to mention that you heard him on John Carney’s podcast and receive your FREE APARTMENT RESOURCES GUIDE.

Thanks again Joe for taking the time to share your story with us.

POST GAME REPORT: Episode Transcript

The Real Estate Locker Room Podcast

JC 002 Multifamily Syndication, Teams and Giving More with Joe Fairless

 

Announcer:  Welcome to the, “Real Estate Locker Room Show” with John Carney. Did you know investing in real estate is a team sport? Join John and his team as they explore the business of real estate and athletic competition. The goal for this show is to grant you direct access to the real estate pros that are closing profitable deals and growing their businesses. On the “Real Estate Locker Room Show” we are getting in the ring with successful investors, developers, operators, and all of the industry professionals to learn what it takes to achieve on-going success. Now it’s time to kick-off and level off with new place to grow your real estate business.

 

John Carney:  Hello and welcome back to the Real Estate Locker Room Show. I’m your host, John Carney, coming at you from Cleveland Ohio. Joining me today in the locker room, from Cincinnati Ohio, is Joe Fairless. Joe is a real estate investor, a podcast host, a philanthropist, and author. If you’re not familiar with Joe’s show on iTunes, it is the world’s longest running daily podcast for real estate. It’s the Best Real Estate Investing Advice Show. Joe has interviewed Barbara Corcoran, the author we all know so well in the real estate world, Robert Kiyosaki, as well as hundreds of other high profile and influential real estate investors. His podcast has over 4000 daily downloads, and 140,000 each month. And we’re up to episode #771, so check that out. Along with being a Podcast Host, Joe is also the author of, “Best Real Estate Investing Advice – Volume 1.” which we can talk about. I remember seeing that release, it blew-up Amazon. So, check out his book as well. Klout considers Joe the top 5% online influencer. Joe is an active, full-time real estate investor, who controls over $54 million in real estate at the moment. His focus is on multiple family. How are you doing Joe? Thanks for taking the time to share your experience with our audience.  

 

Joe Fairless:  My pleasure. Nice to be on the show. I know that you are a little under the weather. So, I will try to talk as much as I can. That way you don’t have to talk. I am really looking forward to our conversation.

 

John Carney:  An all-around good guy, thanks for that Joe. All right, we’re here to explore the intersection between elite sports and elite real estate investing. I like to stretch out, as with a sports related question? Who is your favorite athlete of all time? And why?

 

Joe Fairless:  Well, I’d say, the first person that comes to mind and it’s a little ridiculous, but Mickey Tettleton. He was baseball player who played for the Detroit Tigers, the Texas Rangers and probably others. He just had a funky batting stance and I just really enjoy how he approached the game a little bit differently. Because he had a batting stance where you know, you typically hold the bat upright, right before the pitcher throws. But, instead he had it just parallel to the ground. And then he would bring it upright, right before the pitch came. And what I liked about that is, it’s different. But, yet he was effective non-the-less. I think applying that in our real estate business is certainly noteworthy. Where we can approach things differently but then be just as effective, or more effective as before anyone else.

 

John Carney: I’m not familiar with this player and his batting stance, but I will look that up here shortly. You transitioned from the advertising world in New York City, to full time real estate investing. I’m interested in that journey, how people make that transition. Do you mind sharing your story about, “why real estate?”

 

Joe Fairless:  Yes. I am from Texas, where I graduated from college in 2005 from Texas Tech. as an advertising major and then went to New York City. I went from, cows and cotton, to concrete and I guess, no sun and lived in New York City for ten years. I worked on Madison Avenue after college, which is very prestigious, but it is also code for, I didn’t make any money at all because I was in a very competitive environment. I climbed the corporate ladder, became the youngest Vice President of a New York City advertisement agency and then, at the tail end of my advertising career, I started investing in real estate. The reason why is because I knew that I had to invest, I had to learn about investing, but I didn’t know quite what to do? So, I ended up reading a bunch of books, went to online forums, talked to people I knew and found real estate investment the choice that I wanted to pursue. Once I did that I started looking at what I wanted to invest in. Initially I bought single family homes and in 2009 I bought my first house. Not because I had a crystal ball, and I knew it was what the right time to buy. But, because I didn’t have any money. So, in 2009, I was very fortunate, I didn’t have any money until 2009. And once I bought in 2009, I bought my first house, $76,000.00 that rented for about $1100.00 or so. Rent is around $1200.00 now. Went for $1100.00 to $1200.00 now. I bought three more houses, and then realized that it just wasn’t happening fast enough. I would make $250.00 a month, on a house. And then a tenant would move out and I would have to pay, meaning me, would have to pay $5000.00 for move-in ready costs, the carpet, painting, and misc. fixes. There would be my profit that was going to be wiped out for a year and a half. I thought, wait a second; this isn’t going to make me financially independent. I’ve got to think of a different approach. I started studying multi-family investing, learned the process, bought a lot of books, started talking to a bunch of people. I ended up leaving my full-time job while I was still studying, multi-family investing. Well, after I left, I left because I just wasn’t digging it anymore and life is too short not to do stuff you enjoy and let it go by. Therefore, I started looking at syndication where I raise money from investors in my apartments and share in the profits. Because I couldn’t get approved for a mortgage for a house. And I couldn’t get approved for a mortgage for an apartment building. Because I didn’t have a W2 income. I was kind of forced to find creative ways to buy apartments, and that’s what I did, I wrote and learned how to raise money from investors. By getting something together, and share in the profits and now, you mentioned $54 million, it has actually increased, to $85 million, since the last buy out. So, now I control $85 million-dollars-worth of real estate. That is, apartment communities, that’s like 99% of it, apartment communities. I still have three homes but most of it is apartment communities and they are in Dallas, Fort Worth, and Houston, Texas.

 

John Carney:  Congratulations. So, you got into the single-family home game. Which is where, I don’t know? I’ve never really made this comparison before. But right now, up in Cleveland we’re in the ALS, so I’m thinking baseball right?

Yes, in order to get to the ALCS, all these guys started in Little League right? So you have to start somewhere. Would you say, the single-family home experience taught you what you needed to know to raise the bar to the next step because that’s part of the progression of being a real estate investor?

 

Joe Fairless:  Yes, I’d say it taught me what I needed to know and to learn more about it. It taught me that real estate is the way to go, for my own purposes. And it taught me that what I was doing at the time wasn’t going to be scalable and wasn’t going to help me become financially independent. I created a spreadsheet for my homes that included a home, I think it was like a home a year, 3 homes a year that I was going to buy. And over ten years it was like, oh, my god, stop the madness. Because I bought four homes, I was having a hard time keeping track of all the paperwork that’s involved with the property management, the insurance, the taxes. I was like, I do not want to scale this at all. And, I want to pause, by saying you can make money doing that approach by the way. People have and they do. I just didn’t want to set myself up with single-family homes. So, it inspired me. And gave me some perspective for what I did want to do.

 

John Carney:  Right. We both know people who have enormous single-family home portfolios. And a big key to that is, a big key to everything is management. You decided that your niche was going to move and we come across that all of the time too. You know, we are talking about sports, what athletic competition were you involved in, when you were growing-up?

 

Joe Fairless:  Well, I primarily played baseball and football. I played a little bit of football in college at a small Division III school. I primarily played baseball and football.

 

John Carney:  To be a collegian athlete, in any division, requires a certain amount of discipline. When you left the competitive sports arena of college did you see that it helped you apply what you learned through the discipline of sports and in your first job, and translate that right into real estate.

 

Joe Fairless:  I think what it taught me the most is that when something bad happens, learn from it quickly and move on quickly. That’s what so many people get caught up in. I’m on a softball team right now and I see people on my softball team and they make an error, or they strike out and when they strike out, they should kick themselves off the team… it’s soft pitch, when they pop-up, or hit a grounder…and they’re pissed off for four innings. It’s like, dude, get over it! Immediately, learn from it and get over it, immediately. Otherwise, you’re going to let that influence the rest of the game and they’re going to be compounding negative consequences. And that’s what I apply in business too. When stuff goes down, which happens weekly. Something goes wrong weekly. Sometimes daily depending on what’s happening but at least once a week. We got to learn from it quickly, and then move on.

 

John Carney:  I agree, it’s a team effort, real estate or business. And whether you’re buying apartments or selling doughnuts you need a whole team of people to help you be successful. .

 

Joe Fairless:  Yes, I read that in a book somewhere too, but I forget which book?

 

John Carney: It’s really the same.

 

Joe Fairless:  I’m kidding, it’s your book.

 

John Carney:  I know. Doughnuts—that’s what got me, I just can’t come up with the doughnuts. I just moved back to the states. Now we have a Dunkin’ Doughnuts around the corner. So, of course I had to try that. But, along the lines of what you just said is something that I learned recently. And maybe it’s something we’ll, it was the way it was phrased? “A bad decision made quickly is better than a good decision that takes a long time to plan.” And this can be applied to when you have to make a decision quickly. If you don’t have all the time in the world, make a decision and if it isn’t the best decision at that time, you still have time to adjust.

 

Joe Fairless:  Yup. I agree with that for the most part. It depends on how high the stakes are? Sometimes it takes a little bit more. But, one of my favorite books, is, “Blink” by Malcom Gladwell. He talks about how he can a split decision, an informed decision in the blink of an eye. That is just as informed as if we’d spent months, years, pondering what we would or should do? Our eyes very much embrace that philosophy for the most part.

 

John Carney:  Malcom Gladwell’s fantastic. I like all his stuff. What are you working on right now? I think you might want to share with us, I guess?

 

Joe Fairless:  I’m working on a couple of things. I mean, the three ways I make money. Because let’s start there, and then we’ll talk about a couple of projects. Three ways I make money –

 

  1. By doing multi-families syndications. Where I raise money from investors and invest and put up a little bit of my own money on the deals. And then we share in the profits. We are under-writing multiple deals. Well, more than multiple. Lots of deals right now. My business partner is in Dallas, as we speak, literally as we speak. He’s in Dallas touring properties that we’re in the final found on. And so, I’m focused on that and getting my investors prepared for the next deal.

 

  1. The second way I make money is through my Podcasts. And really, when I say make money it’s pretty much break even, depending on my staff salaries. But, it is, a way for me to provide thought leadership, to learn by interviewing people like yourself and others who are very experienced, or doing something very interesting. And just keeping my mind sharp. So, working on continuing to optimize the Podcast, and getting the word out there.

 

  1. And then the third way, I make money is through my client consulting program. I have private group of clients that I walk, hand by hand through the multi-family syndication process. It’s a major amount of my time. So, I also am working on new content to continue to keep that program refreshed. My team and I upload a new piece of content each week to the resources site that my clients have access to.

 

Those three revenue streams are what I use to guide my months, my weeks, my days. In terms of what I focus on. Those are some of the projects.

 

John Carney:  Okay. And in each project, or each income stream I would imagine has a unique team allocated to that right? So, I mean, what they’re investing in, in real estate. Where you’re providing a service, like consulting service. Or you have to surround yourself with a group of people, correct? And would you look at those teams, as one big team, or individual teams, or how do you manage that?

 

Joe Fairless:  There’s overlap, for the most part. I have my administrative assistant, Samantha and I have my content creator, who helps me with the content and thought leadership, that’s Theo. He’s a Co-Author of the book with me. And we’re writing another one right now together. He and I and she and I, all three of us, overlap on all three of those revenue streams. As far as other team members go. I have team member who finds interview guests for my podcasts, as well as does the show notes and does the promotional efforts. And I have a team member who does all the editing of the podcasts. So, those are the four team members that are on my payroll every month. And then misc. contractors. Like, someone in India, who does SEO for me through UpWork.com. And some social media company that handles social media and things like that.

 

John Carney:  Got it. And I mean today, in today’s world, stay on track with real estate. You look at it like a business, the business of real estate, and being an investor. And you want to grow and attract money, right. Because everyone runs out of money. As someone put it recently, you have your internal/external team. The external team being your professionals, like, your accountants, and your local lawyers, your internal team being like, partners, mentors, and assistants. So where do you go when you have profile. How do you fit a profile into the mix if you’re starting out as a real estate investor and you want to raise the bar, build your portfolio, in whatever niche you’re in and take it to the next level? Would you recommend that raising your profile in your community is something you ought to look into doing?

 

Joe Fairless:  Yes. Help me understand what you’re asking?

 

John Carney:  You’ve got your team, and you’ve got your businesses up and running, but you’ve also built a great profile in the industry. When it comes to people who are investing in real estate, investors who are new or wanting to scale up. I just wanted you to touch on adding to your profile. You spoke about social media management and some content creation.

 

Joe Firless:  I think the most important thing when you talk about building your profile. Or building your brand, or creating awareness for yourself and your company is to find one platform that comes natural to you, that you enjoy posting on and own that one platform. One of the mistakes people make, is try to be everything to everyone all of the time. That’s huge mistake, because any one of these platforms, Instagram, Twitter, Facebook, a blog community, YouTube, iTunes, Amazon, has millions, upon millions of people to speak to and to connect with. The mistake people make is that they want to be everywhere at once. They water down their message and don’t focus on one thing. Just focus on one thing, on one platform that you enjoy posting on. Provide thought and leadership to your audience once you define them, and you’re going to over time, build a following. That’s going to translate into the direct business results.

 

John Fairless:  That is great business advice. So, I guess that’s what carries us onto the next question that I have. If you’re a rookie real estate investor, or a newbie that might have one deal or two deals under their belt and are just thinking of doing exactly what you did in your career—and that is, they may burn out on the corporate ladder side or just need a change of pace or might be wanting a move from a warm climate to a cold climate, or visa-versa—what advice would you have for them to kick-off and get started?

 

Joe:  For someone starting out? I’d say, make sure that you know the basics of what you’re looking to do. Whether it’s a single family, or multi-family, or storage units, or office retail, industrial parking, or whatever? Learn the basics through books, and online forums. Then, once you know the basics. Identify people in your area who are doing what you want to do, reach out to him or her, or them, attend meetings. Speak to them, and get to know them. Buy them lunch, buy them dinner, buy them whatever, a book, or whatever. Add value, be very grateful and appreciative for their time in meeting them, the time they are spending with you. Be respectful of their time and go with an agenda. Have a focused conversation, make sure, if the meeting is for 30 minutes, you meet for 30 minutes. If they can stay longer, then by all means do it. But, be respectful of their time and say, “I know we scheduled for 30 minutes, are we good? Do we need to wrap this up?” Stay in touch with them. That’s probably the best way to get things going. I think 98% of the people who hear this, won’t do that. Instead they’ll read some books, do some online forums, listen to Podcasts. Then maybe reach out to one or two people at most. And not be respectful of their time, not buy them lunch. Not go in with an agenda. And that’s what happens and how the herd gets thinned. That’s how some people go to the top, some stay in the middle, some kind of float in between, and some sink to the bottom. So, I’d say fortunately you have an audience who is taking the time out of their day, to listen to this Podcast. So, I’m going to take that into consideration. In what I said earlier, I think a majority of the people listening will do that advice. But, in general the real estate investors who hear this advice, or where told this through some other channel, they won’t act on it. And it’s a shame, but it makes everyone who does that stand out, and be more successful.

 

John Carney:  Right and joining a community that’s actually not as large as people think it is. Or would you agree with that? I mean, that is also sound advice for the people that do listen to Podcasts, your Podcast, this show and the other good real estate Podcasts out there. What a great way to be in a conversation with people and learning something during that commute to work, or when you’re jogging. I quit radio probably two years ago when I was first told about Podcasts and started looking them up. The day I listened to my first Podcast I thought this is awesome! There’s more in it, and it just became a habit. So, when I moved back to the states, they were trying to sell me every subscription possible for radio. I told them I don’t listen to the radio and the guy couldn’t believe it. I listen to Podcasts, man and that’s how I continued to educate myself. Well, cool. That’s great advice Joe. Can we get into our two-minute drill here?

 

Joe Fairless:  Let’s do it!  And we’ll get to the rhythm and point of this interview.

 

John Carney:  What is your favorite sport? Or business book? That you’ve read recently?

 

Joe Fairless:  My favorite sport is, well recently, my favorite sport right now is softball.

 

John Carney:  Softball, okay, perfect, that’s a lot of fun. What about like books? Like, that might not have come up? Correct.

 

Joe Fairless:  Okay.

 

John Carney:  What is your favorite book related to either business, or for instance, sports.

 

Joe Fairless:  Okay, favorite book about business, sports, would be, “Crucial Conversations” and the whole point of the book is that they help you create a mutual purpose when the stakes are high, and opinions vary. And that’s the key, create mutual person and build up from there.  

 

John Carney:  Cool, I’m going to check that out. Is there one quote that keeps you motivated when things get tough? Like that one quote?

 

Joe Fairless:  Yeah, “The secret to living, is giving.” Another cousin of that quote is, “Help enough people get everything they want, you’ll get everything you want.”

 

John Carney:  Perfect. So, when the chips are down. Think about what you can do to give a little bit more.

 

Joe Fairless:  Yep.

 

John Carney:  Got it. Awesome. Do you have your #1 come from behind victory in real estate, and what did you learn from that?  

 

Joe Fairless:  The come from behind victory would be when my first syndication deal, it was about 2 and half weeks before we were supposed to close. We had over $200,000 worth of investor dollars go away for various reasons. And it was last minute. But, I got my one of my existing investors to go and bid what he had originally asked. And it ended up closing.

 

John Carney:  Did that translate into a happy investor at the end of the day.

 

Joe Fairless:  Yes, absolutely, certainly.

 

John Carney:  Going big. Is there any training for success? Like, your number one, maybe habit that you do on a daily basis. That would put you in a flow-state, or is it training for success habit?

 

Joe Fairless:  I have a liter of water with a scoop of wheat grass every single morning. I’ve been doing that every single morning for the last 3 years and it helps me stay healthy.

 

John Carney:  Fantastic. And then the #1 tip for winning more?

 

Joe Fairless: Would be, don’t focus on winning the score. Focus on winning the battle within how good you can be. Because the competition is in others. The competition is how good you can be within yourself.

 

John Carney:  Perfect, alright, that’s great! Well, thanks again for joining me today Joe. We want to be able to let our audience know exactly what, where they might be able to find you if they want to hook up on some social media, or carry on a conversation with you, where are you these days online?

 

Joe Fairless:  You can go to the App Store and just put my name – Joe Fairless, and you’ll find my Podcast, “The Best Real Estate Investing Advice Ever.”

 

John Carney:  And I highly recommend that all of you out there put that on your show list. So, when you’re in the car you can listen to great advice and the great guests that Joe has on his Podcast as well.

 

Joe Fairless:  I also say that if you Email me at info@joefairless.com I have a department resource guide that has all the websites and research places I go to when I’m researching markets, as well as books I wrote and recommend. So, email me at info@joefairless.com and mention that you heard me on John’s Podcast, and I’ll be happy to get that to you.

 

John Carney:  All right, perfect. So, there you have it folks. I truly hope that you picked up some actionable advice today, from Mr. Joe Fairless. Make sure to check-out this program – Post Game Report on iTunes. And while you’re there, please subscribe to the – Real Estate Locker Room Show to ensure that you never miss out on the pro tips from our guests. The mission here is to help you elevate your real estate game. If you like what this show is about, I’d be grateful if you would leave us a five star review on iTunes so that other like-minded real estate investors can find us easily. You can also visit John Carney online at www.johncarneyonline.com, for links and additional content associated with today’s show. And while you’re there please drop your Email into the newsletter sign-up form, to receive more real estate investing insight, tips and tricks, and other great stuff. Remember to stay focused on your goals, have fun, and stay in the game. I’m your host John Carney, and until next week, work hard, play hard, and profit hard. That’s a wrap Joe. Thanks again for taking some time out to share your story with us.
Joe Fairless:  Hey, I enjoyed it, thank you.

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