F2415: Good Partnerships & Dedication with Abiel Ballesteros

JF2415: Good Partnerships & Dedication with Abiel Ballesteros

Abiel is the Vice President and Founder of SAR Apartment Capital, a Miami-based real estate investment and asset management firm specializing in multifamily apartment syndication.   He is also the Principal Broker for United Dream Real Estate, a full-service real estate brokerage in Florida with over $150 million in sales. He focuses on sourcing, acquiring, and managing multi-family assets with low risk and high ROI potential for our investors. The key to his excellence is his competence and dedication in helping his investors gain financial freedom and build sustainable wealth. In this episode, Abiel takes us through the importance of strong relationships and partnerships and why it became the foundation of their success.

Abiel Ballesteros Real Estate Background:

  • Full-time real estate investor
  • 16 years of real estate investing experience
  • Portfolio consist of 845 units 
  • Based in Miami, FL
  • Say hi to him at: www.abielballesteros.com

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Best Ever Tweet:

“Having partnerships allows you to see the things that you don’t see.” – Abiel Ballesteros


Ash Patel: Hello, Best Ever listeners. Welcome to The Best Real Estate Investing Advice Ever Show. I’m Ash Patel and I’m here today with our guest, Abiel Ballesteros. Abiel is joining us from Miami, Florida. He’s a full-time real estate investor with 16 years of experience and his portfolio consists of 845 units. Before we get started, Abiel, can you tell us a little bit more about your background and what you’re focused on now?

Abiel Ballesteros: Thank you for having me on the show. I got into real estate in 2005. I was drawn to the business by that boom that was going on in real estate back in the day [unintelligible [00:01:26].28] doing residential appraisals sold me on it. As a young kid, my dad did a lot of rehabs, maintenance work, and things like that, so I was always around the construction business at a very early age… So it drew me to the business. I would have to say at that [unintelligible [01:45] about 25 years old, I was kind of lost in my life. I chose the path of workforce coming out of high school instead of going to college, and did a lot of numerous types of jobs. I think the only one that kept records of how many jobs I had was my mother.

I started the workforce very early. At the age of 16 I was already out there working. So school was not an option for me; not because I didn’t grow up in a family that had education, it’s just I didn’t connect well in school. I struggled in school with education, and the way the school was didn’t fit me at that stage in my life. I won’t preach that to my kid now, to my son now; I would love for him to go to school. But back then just working for me and making money was the option that I want it to go through.

Going through a lot of jobs, I fell into real estate and it just hit me, I just loved the industry immediately. But it evolved from different things; it evolved from a residential appraisal to start flipping properties with my father, with his background in construction. That led me to appraisails, to doing a lot of flips between 2005 and 2008. Then the crash hit, I was very fortunate that I had some strong and older mentors that were flagging me down, “Hey, you’ve got to slow down. Something’s going to happen. Something’s going to happen.” I was able to exit a lot of my flips in time in 2008, so I didn’t get to experience that hit that a lot of them took, but I did lose all my business, in the sense that I had no cash flow, nothing going on that had an income. The appraisals dropped, they changed the regulations, it was hard to do business.

Gradually I dwelled off into other businesses like restaurants and marketing. That led me back into going full-time into real estate and flipping houses, beacuse in 2010 the properties were just amazing and the prices were cheap. I saw the amount of all these hedge funds gobbling up properties in South Florida.

That’s how I lived from then on. Slowly I started watching how syndicators and multifamily guys were buying the properties. I got myself really educated through shows like this, through podcasts, through YouTube videos, trying to learn how do investors buy these big large apartments? It always intrigued me. Slowly but surely I got into duplexes and fourplexes; that was extremely hard to scale. I was living a life of a roller coaster, flipping houses. One day I was balling, the next day I was fully invested in four or five houses, and that was extremely stressful. That’s when I started saying I need to commit to a certain amount of cash flow to cove — I started first covering my expenses.

I think that a lot of multifamily investors go down that path. I just want to cover my expenses and do my thing on the side with real estate. Then I just got hooked with the multi-families, man. Now I am a full-time syndicator, buying large apartments, and actually not touching any single-family flips at the moment. Actually, I’m so focused that if you send me a house I wouldn’t even open the email, because I just don’t want to go down that rabbit hole right now. I just want to get big apartments.

Ash Patel: Tell me about your first syndication, please.

Abiel Ballesteros: My first syndication was in Cape Coral, Florida. It was a 16-unit syndication with a friend of mine, a partner, which actually we own a lot more units now. We bought that deal together; he put in the capital, I found the deal, I did the operational, I increased the rents, and once we stabilized it, we refinanced the property with Fannie Mae. We had the vision of a long-term hold and we got an offer. It was an off-market offer, it was a local broker that sent us an offer, and we were like, “How much are they going to give us for this?” We just couldn’t believe it. We told them, “Well, have a loan” and we explained to them the loan is assignable. What’s crazy was I wasn’t that educated. I knew I needed to get an assignable mortgage just in case, but I didn’t know how desirable that was. It was actually very desirable to this buyer that we already had the mortgage locked in.

We ended up exiting within four months after we got the mortgage. My mentality now is a little different. Now, I would probably not have accept that offer, because now we have a longer-term hold. But that was my first syndication multifamily deal, it was the 16-unit one.

Ash Patel: Did you have syndicators on that or just your one capital partner?

Abiel Ballesteros: It was two capital partners. So it was actually a joint venture.

Ash Patel: Okay. You found the deal, they fully funded the entire deal, rehab, everything?

Abiel Ballesteros: Correct. 100%.

Ash Patel: Abiel, do you remember the numbers on that property?

Abiel Ballesteros: They were townhouses. There were 16 townhouses; we bought them at $70,000 a door, we spent an average of between 10 to $12,000 a unit, I know that we hit a target rent of between $1,250 and $1,300 a unit, and we exited at $118,000 a unit. It was a nice little flip.

Ash Patel: How many years did you hold that?

Abiel Ballesteros: It wasn’t even a year.

Ash Patel: So now you’re riding this market wave up.

Abiel Ballesteros: I made more money on that small multifamily flip than I was making in residentials, because in residential we use sometimes bridge loans to buy these properties. There’s paying a mortgage out of my pocket to pay the bridge. This multifamily had income flowing in since day one, so it just offset that overhead of paying a bridge loan or private loan on a single-family. It just made so much sense, it was just like “Oh my god, this is sweet, man.”

Break: [00:06:51][00:07:57]

Ash Patel: Were you a 1/3 partner in this deal?

Abiel Ballesteros: That deal was a sweet deal. It’s hard to close those types of deals, so it was 50/50. It was a 50/50 and it’s hard to close 50/50s now. Now that you’re scaling it, it’s not like that anymore.

Ash Patel: What was your next deal?

Abiel Ballesteros: The next deal was another small apartment with 14 units in Fort Myers. That one was very similar, not with the same investor, but with a different investor. Very similar. That deal actually went a little longer; than one went almost two years. But same exact model, same structure. From that one, I jumped into a 32-unit in Crystal River, Florida. Then from there, I scaled it to 100 units in Miami, and now we are only looking at deals that are above 80 units. They just make more sense for our business model.

Ash Patel: Abiel, your first two capital partners hit a home run on the first deal. Why didn’t they invest with you on the second and subsequent deals?

Abiel Ballesteros: They did; the first one, he did the Cape Coral one, bought with me on the 100 units that we bought. The one that did the 14 units, to this day he’s still also my equity partner on deals.

Ash Patel: With cap rates compressing, what is your target cash on cash or IRR number that you want to hit on each of these properties?

Abiel Ballesteros: We need to be above 10% cash on cash. Our IRR has to be at least 18% and above. Traditionally, in most of the deals that we’re looking at, IRRs are above 20%. Realistic, conservative numbers; we want to be realistic. Our business model is distressed properties. We don’t buy stabilized products. Most of our deals have 20% to 30% vacancy, they’re just in poor shape. That’s our criteria. They usually come off-market. We buy properties that are completely empty, [unintelligible [00:09:37].23] deal not as completely empty. That’s what we like to get – we like to get into the heavy lifts.

Ash Patel: There’s your strong background work ethic wanting to take these distressed properties and completely turned them around. How do you find these deals?

Abiel Ballesteros: Strategically, what I did was, when I created — I always say “I”… When we created SAR Apartment Capital – I have my two partners, Rene Sanchez and Sam Jazayri… I saw that we shared the same values, principles, and love for distressed properties. What I mean is that I will show investors a vacant multifamily building and they will just get terrified. They’re like, “Oh, this is too risky.” I will show it to these two guys and they’ll get so excited. I’m like, “Yes, this is exciting. We’ve just got to get it at the right price.” They weren’t scared of the heavy lifting. In fact, they wanted those types of deals.

For them, it was actually less risky, because that’s the way I saw it. If we get it so cheap, it’s actually less risky, because we know what we’re walking into; we have a plain canvas to underwrite a deal. We’ve got access to all the units, we’re seeing the condition, and we know it’s going to cost this much… So for us, it was easier than looking at stabilized products where you have so many hidden things; properties are fully furnished, tenants are living in it, you don’t get to see too much of all the units, sometimes you don’t get access to all the units… So this is just, like I said, an open canvas just for you, to see everything that it has.

Ash Patel: So if you think back to when you were doing all of this yourself, and then you took on the initial partners, what advice would you give somebody that has always done their own deals and now they’re looking to take on capital partners or do a raise? What advice would you give them?

Abiel Ballesteros: Yeah, the best thing I ever did was joint ventures with my partners. It’s a dynamic that we needed. One of my partners, he’s been in the business for 40 years, very successful in real estate. Renee has also been in business for a very long time in multi-families. So I don’t have to make a decision on my own anymore. That stress of having partnerships allows you to see the things that you don’t see. Sometimes we’re so stuck in our vision, and we’re so gung-ho on what we want and what we want to see. Sometimes we’re blinded because we’re so eager to do a deal. Having other partners underwrite a deal with you, sit down with you, “Is this for us?”  When you start seeing how they see the deal and their concerns, you’re like “Whoa, whoa, I did not see that coming.” Especially when you have a partner with that much experience.

So that to me was the best decision I made. It’s like going back to a board meeting and bring to your board a deal that you feel confident about, and then they just start chopping it down. It’s a necessity. This is not a one-man game; you need a team around you, you need a strong support team. What we did also to bring in this team is that we join-ventured with [unintelligible [00:12:17].00] with a contractor that’s highly experienced. He comes in before we get out of our DD, our inspection period, he gives us his advice on what maybe we might be missing. That is just three great minds giving you advice on a deal. It just makes it so much better, man. And for the investors.

Ash Patel: That is great advice. Is your contractor a part of this deal as well?

Abiel Ballesteros: He does come in in some of the deals with us.

Ash Patel: What are the challenges with that?

Abiel Ballesteros: Well, it’s not really a challenge. We have contractors actually putting some capital up into the deal. We actually embrace that.

Ash Patel: Are there any conflicts of interest when that happens?

Abiel Ballesteros: That is always the concern, is a conflict of interest. The way we go around the conflict of interest is we have our underwriting, we’re very specific of what a cost to a knob installed in a unit is. We have our own construction detailed list of what each item should cost, and what each item should cost in labor and material. So we would walk and underwrite the units just like we underwrite an Excel sheet. We would do the same thing on a per unit basis. So we kind of have an exact specific cost of what we know the units are going to cost, and then we give it to them – “Can you do it for this amount?” Once we show them that amount, he says, “Yeah, we’re not seeing this, and that.” But we already know ourselves. We shouldn’t be too off on what we think it’s going to cost.

Ash Patel: Got it. So you’ve mentioned deals with joint venture partners. Do you also do deals with syndicators that are passive investors?

Abiel Ballesteros: That is correct. We just closed on a deal that we did with a group in Ohio.

Ash Patel: And how did you go about finding your investors in the passive deals?

Abiel Ballesteros: The passive deals were word of mouth, relationships, talking to a lot of people in my circle in Miami. Once you do a couple of deals in multifamily — sometimes you’ve just got to get in with the small deals first to get some experience under your belt. I definitely get that advice. Once you’re able to do a couple of small multi-families, some people are fortunate and they could just go into bigger deals. I started the small route;  I started with duplex, and triplex, fourplex, to the 16, to the 14. That’s the way I built my relationship and my experience.

Once you have a few of those you become more attractive to investors. There’s a lot of investors that are at the point of their lives that they’re educated in multifamily, they know the business world, they’ve had success in that business, but they don’t want to be the operator. They want to find a partnership with someone that is a strong operator, that is knowledgeable, and I found that niche. I saw that there are investors that know the business very well, probably better than I do, but they just don’t want to be the boots on the ground anymore. But they do want to invest with an operator that will.

Ash Patel: Do you also have novice investors that you have to educate on the passive side?

Abiel Ballesteros: I’ve had those. I do. There are friends and family that had nothing to do with real estate, that put in some capital in our deals. We do have those.

Ash Patel: What challenges are there with trying to educate those folks and get them to see the long-term picture of what you’re doing?

Abiel Ballesteros: I think it’s a personality thing. Some of them are very hands-on and want to know every time you send them a monthly report. Some of them are just okay with just hearing about the property. I know that some of them like to drive around the property, they like to see it, they like to walk it. Some of them don’t ever go to the property. It’s definitely a personality thing.

The only challenge that I find is not with them, it’s more of in-house, making sure that we provide our monthly reporting that it is as detailed as possible. If you do that, and you’re consistent with your monthly reporting to your investors, and you make sure it’s very detailed, there’s no reason for them to give you a call. Unless they have a concern about something that they saw in the report. But if you communicate well on a monthly basis with the investors on that monthly reporting, you should be fine.

Ash Patel: Good. What’s the biggest lesson you’ve learned in doing all of these deals? What’s the hardest lesson you’ve learned?

Abiel Ballesteros: There’s been so many…

Ash Patel: Give me a real tough one that hit you.

Abiel Ballesteros: Attention to detail. My two lessons are attention to detail on your craft. You can’t assume anything; do not assume the contracts that you’re signing are going to be okay, do not assume the agreements that you’re doing are going to be okay, do not assume that everyone is an expert in construction. Those are my experiences, my expensive lessons of life have been those – assuming that someone told me something, I saw their resume, I saw their background, that they knew what they were doing in construction.

Do not assume that someone read this agreement and said, “Oh, everything’s fine.” No. Give me bullet points. What are my warnings on his contract? What should I be aware of? That goes with attorneys, do not assume that your attorney — some attorneys just browse through it. They need to be very detailed in what they read in these contracts.

So the attention to detail is something that I work on every day in my life, especially when you’re trying to grow a business. I stopped assuming that everyone knew what they were doing.

Ash Patel: That’s great advice, and having your partners involved probably helps that attention to detail as well.

Abiel Ballesteros: Oh, yeah.

Ash Patel: Good. What’s your best real estate investing advice ever?

Abiel Ballesteros: Clarity. You need to have clarity of what you want, all the way down to the specific product you want to buy, to the specific city, suburbs, or neighborhood that you want to be in. You’ve got to have that clarity of what exactly you want. The day you discover that, it’s something that would take away so much stress from you. If you want to be the investor that’s doing it all, you’re not going to draw the big bucks. You need to become an expert at one thing, understand it, learn it, be obsessed with it. Understand that city, understand the submarkets, understand the rents in that city. If anyone says “I want to call Ash”, I know that Ash is going to tell me specifically the most confident market he’s in, because you have that clarity. That is the mistake that I see investors and friends of mines make all the time, and it’s a mistake I made for many years. Once you obsess about one thing, you become so good at it that when you talk to someone about it, they’re going to know you know your stuff.

Ash Patel: Are there markets that you focus on, in that if there’s a deal that comes up in a market you’re not familiar with —

Abiel Ballesteros: It happens all the time. It draws you in because you see the numbers are great, but then it goes — you’ve got to stay disciplined, “No, that’s not my sub-market. This is my sub-market. I’m sorry. The numbers look great, but you got to make sure you stick to the sub-market you’re an expert at.” As of right now, we are an expert in Atlanta, we’re an expert in Columbus, Ohio, we’re an expert in South Florida, we’re an expert in Jacksonville, and an expert in Orlando. Not an expert in North Carolina, Texas, all those hot markets; right now we’re not there yet. Right now, these are my markets where I’m confident.

Ash Patel: Let’s take Columbus, Ohio. What’s special about that? Why are you an expert and what makes it a good place to invest?

Abiel Ballesteros: We’ve done a lot of underwriting. We’ve purchased 194 units in Columbus, Ohio, the deal that was brought to our table. We wanted to be in Ohio, Cincinnati, and Columbus. We saw the job growth and an economy that was doing well, so we wanted to spread our investments and that was one of the ones that we identified. Then a deal fell in front of us that we had to buy. It ended up being a home run, and that deal actually was a syndication deal with other syndicators that we had great a relationship with.

Ash Patel: Explain that. You went in on a deal with other syndicators. Can you tell me more about that deal and how that worked?

Abiel Ballesteros: Yeah. We raised 50% with another group, a gentleman called [unintelligible [00:19:44].05] They raised money with a group of friends and family. They’ve done a few of these and they’re very educated in that business. My group, SAR Apartment Capital, came in with the other 50% of the equity. We bought it with a bridge loan. It was a very distressed asset; it had over about 25% to 30% vacancy, really low rents. We bought it at $41,000 a door, which ended up being a home run; average rents were between 800 to 900. It is a heavy lift; we’re actually still in the middle of the rehab.

Ash Patel: So the other syndicator found the deal.

Abiel Ballesteros: We found the deal.

Ash Patel: Oh, you found the deal. Why did you partner with the other syndicator?

Abiel Ballesteros: We had a mutual friend, David. David does all our financing on multi families, and David did a phone call with me and Gwaith on a Zoom call – this was like at the beginning of COVID – and we hit it off, Immediately. I liked what they were offering, their expertise, their knowledge, and the conversation just went well. Then we had a couple of other Zoom calls and we underwrote it a bunch of deals together. I saw the way they underwrite their deals and I just knew there were pros at what they did. Then this deal came up, I proposed the deal to them, they said “Yeah, let’s do it.” I went to my partners, “I want to do more business with this group. I think we could grow with them.” And it just led to that.

Ash Patel: And you guys are equal partners on the deal in terms of managing the asset?

Abiel Ballesteros: No, they handle the asset management side. I handle the construction side of the property. So we spread the responsibilities.

Ash Patel: Would you do another one of those?

Abiel Ballesteros: Yeah, 100%.

Ash Patel: Good. Abiel, are you ready for the lightning round?

Abiel Ballesteros: Let’s do it.

Ash Patel: Alright. First, a quick word from our sponsors.

Break: [00:21:28][00:22:05]

Ash Patel: Abiel, what’s the Best Ever book you’ve recently read?

Abiel Ballesteros: Oh, the 50 Cent book.

Ash Patel: What is that? Tell me more.

Abiel Ballesteros: Oh, man, the 50 Cent book just came out. I don’t know how to explain it, man. It was such a great read. He basically explains everything about how he did all his videos, coming from vitamin water all the way to the show with Power. He just gives a different perspective of what you assume. He’s just a rapper, he’s not a very successful businessman. That’s the last book I just read. It was great. I recommend it for anyone that’s interested in business but also into the hip-hop culture.

Ash Patel: Great advice. Abiel, what’s the Best Ever way you like to give back?

Abiel Ballesteros: I like to give back work. I like that we have, right now, 120 people throughout our projects. I like to see that we’re a growing company and we are giving out a lot of employment. We were employing a lot of people during COVID. That brings me a sense of pride that there’s a lot of people that are eating off this multifamily business. It’s not just me and my partners, but this employs a lot of people. These are large apartments; one apartment could bring a lot of money into an economy. So it’s a beautiful thing, man.

Ash Patel: That is a great accomplishment and a great responsibility as well. Abiel, how can the Best Ever listeners reach out to you?

Abiel Ballesteros: They can reach me at my email, abiel@abielballesteros.com, they can shoot me an email there. They can go to my website abielballesteros.com and hit me up if they have any questions or want to do a quick underwriting or anything like that. I’m always open to talk to someone about the business and any ideas that they have. I love this stuff, man.

Ash Patel: That’s great that you’re willing to help. Abiel, thank you again for all of your great advice today. You had an untraditional upbringing; you didn’t go the traditional college route. You had numerous jobs, found the real estate bug, and you had a great trajectory on the way up. The typical single-family, multifamily, graduated to syndications and partnerships… So, thank you again for sharing your story with the Best Ever listeners. I really enjoyed talking to you today. Thank you.

Abiel Ballesteros: Thank you, man. I appreciate the time.

Ash Patel: Have a Best Ever day.

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JF2371: How to Scale a Business to 7 Figures in 3 Steps with Ravi Abuvala #SkillsetSunday

Ravi’s business started with a Google search “How to make money online.” After investing in a course, he started running ads for other people. That’s how he started an advertising agency and massively scaled it.

Ravi believes that the foundations of advertising hold true no matter what business you’re in. Once you write sales letters that convert, that skill can be applied to any industry. 

Ravi Abuvala Real Estate Background: #SkillsetSunday

  • Law school dropout and founder of Scaling With Systems
  • Scaling With Systems is an accelerator that works to bootstrap and scale businesses
  • In the past 14 months, he has scaled two 7-figure businesses with less than $1,000 of his own capital & 4 commission-based employees.
  • Based in Miami, FL
  • Say hi to him at: www.scalingwithsystems.com

Click here for more info on groundbreaker.co

Best Ever Tweet:

“Everyone offers leads; no one offers closings” – Ravi Abuvala. 


Theo Hicks: Hello Best Ever listeners and welcome to the best real estate investing advice ever show. I’m Theo Hicks, and today we’ll be speaking with Ravi Abuvala. Ravi, how are you doing today?

Ravi Abuvala: I am doing excellent, you nailed my name perfectly Theo, better than some of my closest friends. Congratulations on that. Thank you so much for having me on here. I am super stoked to be on here; I’m hopefully going to give some value to the listeners today.

Theo Hicks: Yes, I’m very looking forward to this conversation as well. Today is Sunday, so Best Ever listeners, we’ll be doing a skill set Sunday where we talk about a specific skill set that our guest has. Ravi is an expert at scaling businesses. So that is going to be the conversation today, how to scale your business to a massive scale, and we’re going to go over some specific examples, business he scaled over the past 14 or so months.

Before we get into that, let’s go over his background. So he’s a law school dropout, and the founder of Scaling With Systems, which is an accelerator that works to bootstrap and scale businesses. As I mentioned, in the past 14 months, he has scaled two seven-figure businesses with less than $1,000 of his own capital, and four commission-based employees.

He is based in Miami, Florida, and his website is scalingwithsystems.com. Ravi, before we get into that skillset, do you mind telling us some more about your background and what you’re focused on today?

Ravi Abuvala: Yeah, sure. So I’ll keep it pretty tight for all the listeners out there, but just in case you have somebody in here that’s just new to the business, or thinking of being in business, or what have you – I have pretty much zero background in business whatsoever. No background in sales, no background in marketing. I was actually going to law school about two and a half years ago, and then I inadvertently dropped out; I decided it wasn’t for me. It’s a long story, with my dad’s cancer, and I pretty much had to take care of him. It kind of let me know how fragile life was. I won’t go too deep into that now.

I then got a job at an Italian restaurant around the corner from where I was living, making about $2,000 a month. I pretty much Googled – I’m not joking, for everyone that’s listening to this – “how to make money online”. I was retargeted by some ads, clicked on it, bought in, invested about $1,000 in my first course, and it pretty much was teaching me how to run ads online for other people.

My girlfriend at the time, her dad ran a plastic surgery clinic, and he comes up to me – well, he really came up to her, and he said, “Hey, do you know anyone that can run ads online? I need somebody to help me with my social media.” She’s like, “No, I don’t know”, because no one knew what I was doing at the time. I was so afraid to tell anybody I was running a business, because I had just left law school. So I said “I can,” and I remember he goes, “Oh, you can?” Then my girlfriend at the time goes, “Oh, you can?” I essentially signed him as my first client. I was pretty much addicted from then on.

We went and took that advertising agency from that first client at about $2,000 a month to, now we’re consistently doing a few hundred thousand dollars a month, spread across all around the world. Clients that range from personal injury, real estate, higher ticket clients that do e-commerce, consulting, coaching, services, businesses. Then in kind of that whole little realm of me doing, that I started helping other people to follow my journey and my path, which was pretty much leveraging paid traffic, sales funnels, product-market fits in order to scale really, really quickly. So through that, essentially, business accelerator, I started Scaling With Systems. We’ve helped grow over 800 different firms around the world, a dozen or so in the seven-figure range, and multiple dozens in the multi-six-figure range. That’s essentially what I’m working on right now. That’s pretty much my full-time job, if you want to call it, although it’s more of a passion for me now.

Theo Hicks: Perfect. Thank you for sharing that. As I mentioned in the beginning, and as you mentioned multiple times in your background, we’re going to talk about how to massively scale your business. You mentioned some of the clients that you have, some of the industries that you’re in… Before we get into specifics, just kind of generally, would you say that the tactics are going to be the same in all industries? Or do you need to know specifically what industry they’re in, whether it’s real estate or something else, to determine exactly what they should be doing to scale their business?

Ravi Abuvala: Yeah, that’s an awesome question, Theo. Originally, when I first started working on this, it was pretty industry-specific… Because I don’t want to say that I was just doing like tricks and hacks, but it was something similar to that. But then as we kind of started growing, I started investing more time really studying the foundations of copywriting, Dan Kennedy, The Ultimate Sales Letter, and really understanding the foundations of advertising, some of the largest SaaS companies built today, and  I actually started understanding what product-market fit was, I started understanding how to be profitable from day one, I started understanding how to write sales letters that convert, how to run advertising on a seven-figure per month basis.

So to answer your question, specifically this is going to be for service-based businesses. I’ll be honest with you, when it comes to products, it’s not something that I kind of specialize in. I’m sure you can take some of the advice here if you have some kind of e-commerce or product-based business, but specifically, the stuff that we’re talking about today, at least in my experience, will be helping service-based businesses, whether you’re brick and mortar or you’re online.

Theo Hicks: Perfect. Let’s dive into some of the tips. So if someone came up to you and you had 10 minutes to talk to them, and they asked you for the best tips that they could implement right now, what would you tell them? …for starting their business, obviously.

Ravi Abuvala: Great question. So I’m going to go ahead and really quickly just assume that they might be thinking of starting a business or they might barely have a business; most people play around at a 15% range when it comes to traffic for their business. That’s like the warm range – so your friends or family, your referrals… And you can grow a relatively successful business that way, but realistically, it’s tapping into that 85%, which is what I help my clients do, that you can actually start to really see leaps and bounds, double-digit, month over month growth. That’s going into people that don’t know the difference between you and a hole in the wall. And really, the only way that you can do that is by following a few simple steps.

Number one, you have to have just a massive product-market fit. You have to make sure that whatever you’re offering is a need in your marketplace, not just something that’s nice to have, but is an absolute need. We call it the whisper test inside of my company. You should be able to wake your prospect up in the middle of the night and whisper in their ear what you’re promising to do for them, and they should perk up, grab their wallet off of the counter and pay you immediately, because it’s that big of a pain point. And I’m not even being dramatic when I say that.

So the first thing is to make sure you have that product-market resonance. The easiest way that we’ve been able to find that is to pretty much bring your product or your service to total strangers and try to sell it to them. It seems simple, but most people are relying on inbound traffic. People that are on their Facebook, people that are on their Instagram, people that come to their website… Instead of actually going out and trying to attract traffic, whether it’s outbound messages, cold calls, going to fairs, or even running paid traffic. Because the cold market doesn’t really care how nice you are, what you look like, what you sound like, as long as you can deliver for them.

So the first thing you have to nail down is that product-market fit, and making sure that your messaging resonates with your market. There’s a really, really great book called The Ultimate Sales Letter by Dan Kennedy. I’d recommend it to people; if you’re interested in more of this stuff, look that up. He tells you how to craft that messaging and how to resonate with your marketplace.

The second step, once you have proven product-market fit and you know that people are interested in what you’re doing, is to collect some kind of case study or testimonial that shows some incredible results that you can make a claim about. So for us, we help services-based businesses scale to multi seven figures in under 12 months. Now, the reason I’m able to say that is because I’ve done it for myself, and I’ve done it for other clients as well. So that’s our massive claim that I’m able to say on podcasts, I’m able to say on ads, I’m able to say on my organic stuff, because we’ve done it.

So you need to go out there and find one of the best case studies that you have… Like, I can help people make more money, and then obviously, that’s always the best way to do it. If let’s say you’re in weight loss, or you’re in real estate, or whatever else it is – we call it trading apples for apples. I usually recommend having some kind of transformation that does involve money, because you’re not going to ask them to pay you in weight loss, so you should be able to exchange back to the money. You kind of should be able to tie, “Hey, because you lost 15 more pounds, you’re able to stand up longer, you’re able to work longer without less energy, an average of two more hours a day. Your ad time is worth about $200 an hour, so we essentially made you an additional $400 a day by losing those 10 pounds.” Something along those lines, so that you’re able to take that case study and then go to that cold market place and say, “Hey, somebody just like you, that’s in the exact situation that you were in, I worked with, and I took them to that exact stage that they want to be in”, which I know because I did my research beforehand, I know the product-market fit. “So they’re in this end state that you want to be in. Would you be interested in learning a little bit more about how we can maybe do this for you?”

And that’s obviously a really dumbed-down version of it, but that’s what you do when you start sending LinkedIn messages, you start sending cold emails, you start running Facebook ads, you start doing Facebook messages, Instagram messages. People that that’s going to resonate with are going to respond back, your calendar starts filling up, and then you pretty much start scaling from there.

Then the final thing I recommend is – for our clients, I have a training center in the Philippines, so we’ve interviewed and placed over 1,000 virtual assistants for our clients (that’s some of our secret sauce) and we train them for our clients. So once you have that product-market fit and once you have that case study, and you have some resonance, then what we’ll do is we’ll pretty much just pour gasoline on the fire. They will take this messaging we’ve built together and they’ll just start sending that out to everybody.

So there’s one thing you’re taking on in that last stage there – you shouldn’t be doing that kind of lead generation if you’re the business owner, because you’re going to get tired of it, it’s going to get annoying, it’s going to get repetitive, and it’s going to get mundane. So you should essentially as quickly as possible delegate that out to somebody else. We like virtual assistants because it’s pretty mundane, and virtual assistants are great employees, in my opinion. They’re going to be able to keep your calendar packed and full, and you can grow easily a seven-figure business just by doing that, without even touching the paid ad side.

Theo Hicks: Thank you so much for breaking that down into those quick three, easy steps. First, I was just going to follow up on each of those steps, but as I said in the intro, you’ve got two examples… So do you mind taking one of the examples of these businesses you’ve scaled to seven figures, and then kind of walking us through it from the perspective of these three steps?

Ravi Abuvala: Yeah, I think that’s an awesome question. I’d love to do it. My first ever company, that advertising agency, the first eight months of business, we did about $6,000 total. $5,550. So it wasn’t a great start for us, to be honest with you. But the reason was, was because I didn’t have a product-market fit, I wasn’t listening to my marketplace, and I was just reaching out to total, cold strangers and saying, “Hey, I can get this for you. I can run ads for you. I can run ads for you. I can run ads for you.” What I didn’t realize was that no one really gives a “you know what” about running ads. What you have to be looking to promise is that transformation, not “I can run ads for you.” But for me, specifically, I was in the real estate industry, and I was saying “I can get you two to three more closings a month guaranteed, without you ever having to call another cold lead again.” That was what my messaging shifted to once I started listening to my marketplace and I started saying “Why are you not renewing with me? Why are you not responding back to me?”

I started actually reaching out to them, and I started learning that everyone offers leads, no one offers closings, everyone offers leads, no one offers booked appointments, and no one offers to actually prequalify these leads for our clients. So long before some of these large companies out there like Zillow and Redfin are doing these qualification centers, I was one of the first advertising agencies for real estate to do it. I actually got on Fox News for it. We essentially took the system and then we started selling that to real estate agents.

My first real estate agent was a lady out of Santa Rosa Beach, Florida, where I’m originally from, and we just knocked out of the park for her. I took that case study and then I went out and we immediately started blasting it out to every single real estate agent that was pre-qualified in the United States. I’m saying “Hey, not only am I going to take cold leads for you and generate them for you, but I’m going to take them all the way through the qualification stage and figure out if they a buyer or a seller, are they pre-approved, what’s their timeframe? And then only once they match your qualification statuses am I going to pass them over to you as a booked appointment. I know you think that sounds too good to be true, so here’s a case study of one of my clients named Judy, who we knocked this out of the park for.”

I went from making, like I said, less than $1,000 a month, to the next month we did about $10,000, a month after that we did about $30,000, and within 90 days from the $30,000 month, we had our first $100,000 month. It was just because — it was like a sink or swim; I had to figure out what was actually a need in the marketplace and what was the real transformation that they wanted. As soon as I nailed that down, it was pretty much hammering messaging on that every single day until our calendars were full.

Theo Hicks: Something that you said in the beginning that was interesting… So you talked about the product-market fit. You said that for the agent, rather than saying, “Hey, I can do advertising for you” you said specifically what you would do for them to transform their business, and you’ve mentioned how you’ve found that need was based off of having conversations with different agents. Could you maybe go into a little bit more specifics? Were you just reaching out to just every single agent you could find and ask them what they wanted? I am still trying to figure out exactly what you did to find out exactly why your messaging wasn’t resonating with them.

Ravi Abuvala: Yeah, that’s an incredible question. We actually call it The Research Method inside Scaling With Systems, because we’re helping people do this themselves… But essentially something really similar to that. I actually just edited the document today… But pretty much what you’re doing is you’re reaching out to people in the industry that you want to be in and you want to work in and you say “Hey, look. I’m putting together a report on the top industry experts inside real estate. Your name came up when I was talking with some other people. I’d love to interview you and talk to you a little bit about what makes you tick, why are you so successful, that kind of stuff.” And I’ll tell you what Theo, everybody loves to be interviewed; everybody loves to give their opinion. Look at just the world we live in today. Everybody loves to give their two cents. So you say, “Look, I guarantee you, I’m not going to pitch you anything on this call. I just want to learn a little bit more about you.” And let’s just say six times out of 10, conservatively, they say yes.

When you conduct 10 to 20 of those interviews, what you’re going to notice is a lot of these questions that you’re asking, like, “Hey, what are your top three daily frustrations? What is a service that you paid for in the past 12 months that didn’t work out and why did it not work out? What’s a service you’ve paid for in the past 12 months that worked out and why was that working? What made you happy about it? What keeps you up at night? What do you secretly desire most in this world?” You get these answers and you’re thinking, “Oh, all these people are going to have these drastically different answers.” You put it on this chart and you start seeing they may be worded slightly different, but they’re all virtually saying really similar things. Then you can start taking and plugging those little points that they set in into some kind of messaging template to understand, “Hey, I help real estate agents get ___whatever they said in this bucket that they wanted___”, and then we’ll see what the kind of resonance on that message is. And they get that without whatever they said is the thing that they hate, or that one company that failed them, what was the reason why they failed them.

So it’s almost like a scientific experiment. But yeah, you’re literally going out and reaching out. And then the coolest part about it, if you’re thinking of doing this, is that after you’ve collected that report, which is essentially a Google Sheet, then you reach back out to all those people that you’d originally spoken to, even the people that turned you down, and said, “Hey, it’s been a week, it’s been two weeks. I’ve actually conducted this report, I got some really interesting findings. I’d love to hop on the phone with you and walk you through what I’ve found.” And I’ll tell you what – a lot of times, that’s where our clients close their first deals, is hopping on that call, explaining to them what I’ve found, and then saying, “I have the solution if you’re willing to give me a shot.” They’ll get their first clients just from that.

Theo Hicks: Well, I love it. Where did you get all these ideas from? Did you just come up with these yourself? Or is this all in that book you’re talking about?

Ravi Abuvala: Oh, no, no. It’s not all in the book. It’s probably the combination of 50 different books I’ve read, from a bunch of different coaching programs I’ve been a part of it, from my own insights, and from my own experiences of, like you had said, trial and error. Definitely, that part right there that I just told you was just from my own experience from trial and error.

There is a gentleman, Ryan Levesque — I forget the name, but he did come up with something called The Ask Method, which you guys can Google; it is something really similar to that. It doesn’t go in-depth and talk about selling them after you’ve done it, but it’s something really similar to that, asking people that question. And his is more B2C instead of B2B. But yeah, it’s essentially from me, from learning from other people, and then just my own experiences or learning from other people and then applying it, and then re-teaching it through my own lens or my own perspective.

Theo Hicks: Got it. So using that research method you were talking about, once you conduct these interviews, and then you have that chart you said, to kind of figure out what it is they’re wanting, and then you’ve got your messaging template – so the purpose is actually to take what they say they need and then do that. That’s going to be your business.

Ravi Abuvala: Yeah, it’s really funny, right? I work a lot in the SaaS world as well, software as a service, and you see some of these people, absolute genius. They’re engineers from some of the top schools in the nation, and they spend six months, eight months, a year, tens of thousands of dollars building this product, and they think it’s perfect, their friends, their colleagues, or mom, they all say “You’re doing a great job.” Then, like I said, they go out to the cold, cruel, unforgiving marketplace, and the marketplace says “I don’t really need this. They’re kind of solving not a really big problem of mine.” So they don’t really see crazy growth.

Instead, what we do is something I call just “sell before you create”, which is pretty much what that method was. It is, “Hey, go out there, figure out what their biggest pain points are by just simply asking them”  and then you’re going to see that kind of pattern. And “Okay, they don’t just need leads, they need close deals.” Then you’re going to come back to them, and you’re going to say, “Hey, if I could get you closed deals, would you pay me $1,000, $2,000…”, whatever the price point could be relative to the ROI. That makes it pretty much a no-brainer, because they’re taking a risk on you, you’re taking a risk on them. So “Hey, would you pay me $1,000 if I was able to make you an extra $10,000 a month?” They go, “Yeah, probably, if you can show me you can do it.” And then I go, “Okay, great.”

So then I come back and then now I’m starting to say, “Okay, this is something that the marketplace actually wants. Can I prove that I can do it?” So then I’m doing a little bit of research on my own. You can go online, there are websites like SimilarWeb, you can look at Facebook Ads library, and you can just see what your competitor’s websites are doing, and just figure out what’s working in the marketplace right now, and then you just make yours better, faster, and cheaper.

Once again, we’re still not building out this entire system yet. We’re just getting the ideas of how does this work. Then we’ll compile that together in some kind of pitch deck or presentation; it does not have to take too long. My original pitch deck was five screenshots; it was not pretty at all, I promise you. Then you go back to the person say, “Hey, I found out how to do it. It’s going to involve this, this, this, and this. If you did all this separately without me, it would cost you about $15,000 a month. I’m going to do it now, because you are my first client, for $1,000. If it doesn’t work out, I’ll give you all of your money back.” At that point, they’re like, “Okay, well, sure.” You probably can afford to give that money back, because you’re not really building anything at this point. You’re being profitable from day one by taking that money and then trying to solve it.

That’s when you kind of figure out what the mechanism is, which is, “What is the thing that’s going to give them that promise that I made them?” Then you give it to them. Does it work? Yes or No? No. Okay, that doesn’t mean his need doesn’t exist in the marketplace, it means this his mechanism is wrong. So now you need to go back to the drawing board and try a new mechanism. You pretty much just try mechanisms until one of them hits. Then there you go, you have a need in the marketplace, you have a messaging that captures their attention and slices the noise, and then you have a mechanism that actually delivers what you promise. And now you’re almost cheating. Now it’s too easy to scale.

Theo Hicks: Wow, I love it. Ravi, is there anything else you want to mention before we end the interview? Where people can learn more about you and the other call to action you have?

Ravi Abuvala: No, I really seriously appreciate you having me on here. I think that’s probably the fastest I’ve ever gone through that entire agency process. So I was like, trying to keep it under 30 minutes… So hopefully that was helpful for everyone on here, Theo. Thank you so much for having me on.

If you guys do want to learn a little bit more about Scaling With Systems, some of the stuff I talked about, because obviously, this was like the tip of the iceberg and I couldn’t cover everything, I do have a totally free course. It’s a few hours of content where I go a lot more in-depth; I have product-market fit, and a lot more in-depth on what your messaging should look like, etc. I actually made a landing page for this podcast, so if you just go to scalingwithsystems.com/best, then you’ll be redirected to the free course. You just give us your email, and you can get access to a few hours of the content there. Or you can feel free to find me on Facebook, Instagram, LinkedIn, YouTube, just type in my first and last name Ravi Abuvala. Thank you, Theo.

Theo Hicks: No, thank you so much for that landing page, and also thank you so much for sharing all the knowledge you shared with us today. I think this is probably the most unique information that I’ve gotten from just these quick 30 minutes. I really appreciate that.

Ravi Abuvala: I appreciate that. Theo.

Theo Hicks: Yeah. Best Ever Listeners, make sure you listen to this again. He went over his three-step process, starting with making sure you’ve got the right product-market fit, and then doing that case study, and then the virtual assistants… He also went into specifics on that first step, which was the research method to figure out what the right product is.

Then you walked us through an actual case study of yours and how you presented that case study. You also talked about how you actually create that service on the back end, and then a lot of other things, too. Again, super informational show. I really appreciate that, Ravi. Thank you for joining us. Best Ever listeners, make sure you take advantage of that free course; that was scalingwithsystems.com/best. We’ll have that in the show notes. Thank you for listening. As always, Best Ever listeners, have a best ever day and we’ll talk to you tomorrow.

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JF1798: Running A Business & Completing $30 Million In Real Estate Transactions with Larry Abramowitz

Larry has a ton of real estate experience and he’s on the show today to share some of that with us. Theo and Larry will dive into the details on Larry’s first syndication deal, and how he raised so much money on his first deal. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!


Best Ever Tweet:

“The more you talk to people and learn what they’re doing, the more it will help your business” – Larry Abromowitz


Larry Abramowitz Real Estate Background:

  • Started investing in real estate in 2014 while running his flower importing and distribution company
  • Has done over $30,000,000 in real estate transactions in the USA, Colombia, Costa Rica and Spain
  • Closed first syndication deal in September of 2018 of 108 units in Daytona Beach, FL. Equity raise of $4.5M on first deal
  • Based in Miami, FL
  • Say hi to him at https://www.broadviewcap.com/
  • Best Ever Book: Traction


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Theo Hicks: Hi, Best Ever listeners. Welcome to the best real estate investing advice ever show. I’m Theo Hicks, and today I’ll be speaking with Larry Abramowitz. Larry, how are you doing today?

Larry Abramowitz: Great, how about you?

Theo Hicks: I’m doing fantastic, I’m looking forward to speaking with you today and learning more about what you’ve got going on in your real estate business.

A little bit about Larry before we get started – he began investing in real estate in 2014, while running his flower importing and distribution company. He has completed over 30 million dollars in real estate transactions all over the world – in the U.S, Colombia, Costa Rica and Spain. He closed on his first syndicated deal in September of 2018, which is 108 units in Daytona Beach, Florida, and he was able to raise 4.5 million dollars for that deal. We’ll definitely dive into details on that. He’s based in Miami, Florida, and you can say hi to him and learn more about his business at BroadViewCap.com.

Larry, can you tell us a little bit more about your background and what you’re focused on now?

Larry Abramowitz: Yes. Like you said, I’ve started focusing more of my time in real estate around 2014, and I’ve started buying foreclosed properties in Miami… Which made it easier, since I was still working full-time; I was doing this locally. So I started buying houses from the court auction, or these auction websites like auction.com. I started doing all the eviction processes if there were any tenants or owners, remodeling the houses, then I either sold some of them or kept some of them as rentals… I did the same with some apartments, and then I did a warehouse deal, a retail office, and even a lot that I bought on a foreclosure. So I did a lot of different types of real estate.

I was self-managing all these rental properties, and it was a lot of work self-managing, so I wanted to do something bigger, where I could have a professional management company do the day-to-day of the properties. That’s how I decided to go into syndication, to be able to buy bigger deals.

Theo Hicks: So let’s go into details on that deal you did. So 108 units in Daytona Beach, Florida – how did you find that deal?

Larry Abramowitz: I was looking for deals in Florida, and while analyzing a deal in Gainesville, I was looking for property managers, and while interviewing property managers I was talking to one of them and they said that they sometimes get off market deals, and they’ll let me know if they get anything that they could send my way. About a month later they sent me two deals. One was in Largo, Florida, and one was in Daytona Beach. Basically, when I talked to them, they said that I need to make a decision within the next two days, to decide if I wanna move forward, and with which property, or if I wanted to do both.

I got in my car and started driving to see the property in Largo, early in the morning, and then I drove the same day to Daytona, and then drove back to Miami. So I was probably about 12 hours in the car. So I got to see both properties; I reviewed the numbers that the property manager had sent me, and I decided to go with the Daytona Beach property.

Theo Hicks: When you visited those properties in person, what type of analysis did you do? What  was your gameplan, or what were you looking for, to help you determine which deal to move forward with?

Larry Abramowitz: Well, first I wanted to see the area around the property, and the city and the area where the properties were located, to see if I felt comfortable and I liked the area where the property was located. Then the location of the property within the area;  the one in Largo was actually not on the main street, it was like half a block in, and it was behind the gas station. So even though it was a very nice property, I wasn’t crazy about it not being on the main road, for visibility, and the gas station in front of it.

And it had a bigger property across the street that was going through a remodel, and I felt like you couldn’t push the rents a lot higher; the other property had more amenities and it was a nicer property, so… That was kind of my concern with that deal, even though I understand now it’s performing very well… But that was pretty much why I didn’t go with that deal.

When I went to Daytona, I loved that the property was in a main street, it had a lot of visibility when you drove to the property; it has a lake right in the middle… So it’s a beautiful property to go into. And while analyzing the numbers, there was a lot of value add on the rents; there was a big gap difference on the market rents if I could remodel the units, which was the plan once we acquired it.

Theo Hicks: So you moved forward with that deal. At this point in the process did you know how you’re gonna fund that deal, or did you have to raise the capital after you actually had the property under contract?

Larry Abramowitz: I had talked to maybe a couple of people about the deal, that might be interested. I was putting in 10% of the equity. The property manager was also investing; I think it was about 5% of the equity. So I was missing a big chunk of about 80% of the equity, which I still had to raise after we put it under contract.

Theo Hicks: And can you walk us through how you were able to raise such a large amount of capital? For your first syndicated deal, that is.

Larry Abramowitz: Yeah… That was a hectic process. First I prepared a really professional presentation or package to show the potential investors. Then I just started going through all my contact lists throughout all my years in business and meeting people, and just friends, and friends of friends, and family… I just started calling everybody and presenting the deal.

I got a couple of people to do some big commitments, which really helped lower a part of that pressure. I got a couple of half a million dollar investors. Then I had also a $100,000 minimum, which I think helps to have less investors; it’s easier to manage for your first project, even though it’s a little harder to raise maybe a higher number… But you’re always gonna get people asking for discounts; or not a discount, but I guess to invest less than the minimum, and having a higher minimum helped raise the money quicker.

I went through all my lists – contacts, Facebook, LinkedIn, my friends from the university, from my masters degree, and then family… Then some people started referring. The biggest lesson I learned is that when somebody says “No, I’m not interested, I guess you’ve gotta ask always “Do you know somebody that might be interested?” Most people will recommend somebody that invests in these types of deals, or might have an interest… And as you keep on asking that, you end up finding more and more people to invest.

Theo Hicks: Yeah, that’s definitely a good strategy. How many investors are on this deal?

Larry Abramowitz: 22, including myself.

Theo Hicks: And have you syndicated a deal since then?

Larry Abramowitz: I have not. I’ve been looking very hard, and it’s been hard to make a lot of these deals make sense lately… So I just keep on looking, and don’t give up. I keep on looking for deals.

Theo Hicks: How is this deal performing compared to those projections that you had in the beginning?

Larry Abramowitz: We are over projections right  now. We just did  a second distribution, or we’re doing it this week. In the first two quarters we’re at 6.4% annualized return, and we have projected about 5.8% year one because of all the value-add going on in year one. You really start seeing the improvements towards the second semester, and after you get enough units remodeled. This is already with the adjusted taxes. So even though we haven’t gotten our taxes adjusted, I’m already reserving for that… And looking at the tax roll, I think we’re gonna be under what I projected in the taxes this year, so we might make more… But I like to be conservative.

Theo Hicks: What was the biggest challenge you faced with this deal, either on the acquisition side or the asset management side?

Larry Abramowitz: I would say the biggest challenge was raising the money, just because the property manager brought me the deal, so that was not as hard, finding it. I would say that the hardest thing was raising the funds. Then we had other difficulties in the process, where we were ready to close and the seller was not ready to close. They had an issue with a loan they had on their properties over all their portfolio, that was affecting this property, and that came up towards the end… So they asked for one extension, and then we were ready to close the second time, and they still had a — sorry, the first time they didn’t request the payoff from their lender, so they couldn’t close; then the second time they had this issue with this loan, so they delayed the closing twice. So this process – we started at the beginning of May, and we ended up closing September 24th. It was almost five months to do the deal.

Theo Hicks: Oh, wow. How did you communicate that with your investors?

Larry Abramowitz: That I learned that it’s key – to keep everybody informed; because I had the funds in August, and some people even earlier, in June, and July, when people sent me the funds… And I didn’t communicate for a while, just because I was so into closing the deal that I didn’t send any new communication, and some investors started calling me and saying “What’s going on? We don’t know anything.”

The main thing that I learned is that you’ve gotta keep your communications consistent and very open with your investors, so I started sending every two weeks what was going on with the deal, just so everyone would know and be comfortable that we were still working on the closing. That’s the most important thing – keep everybody informed, all the time.

What I do right now is I send a monthly financial statement, and then I do a quarterly more detailed report when we do distributions – because we distribute quarterly – where I get into more detail of the performance of the property and everything we’ve been able to achieve.

Theo Hicks: Can you tell us a little bit about how you’ve put your team together for this deal? I guess you said that this is a property management that sent you the deal. Are they the ones that are managing it?

Larry Abramowitz: Yeah, they were already managing the deal; they knew it was going to the market, and they were able to lock it up before it went to market. Then they assigned me the contract. That was the way the deal worked.

Theo Hicks: Just out of curiosity, because I know for first-time syndicators a big problem is generating those off market leads, specifically coming from brokers or property management companies who have that rolodex of investors that they know are gonna close… Why do you think it is that they gave you this deal, even though they hadn’t worked with you before?

Larry Abramowitz: Well, I knew a few of the people that they do business with, and when asked for references, they gave me a couple of references, and they were people that I already knew, so I think that helped. And second, I also asked them that question, and they also said it’s because they like to diversify their portfolio of people they manage properties for. They were heavy on a few investors or asset managers and they wanted to diversify, so they tend to look to find properties for different people, so they can have a big, diversified portfolio. I believe that last year they had a big client that sold most of their properties, so they lost a big chunk of their business, and they’re looking to diversify their portfolio.

Theo Hicks: Alrighty. And for the money question, what is your best real estate investing advice ever?

Larry Abramowitz: I think that for me it’s been networking. Just to network with investors, with other real estate investors, with other syndicators, brokers, property managers… The more you talk to people and learn about what they’re doing, or just have conversations, I believe that it will just help you grow your business.

Theo Hicks: Alright. Are you ready for the Best Ever Lightning Round?

Larry Abramowitz: Yes.

Theo Hicks: Alright. First, a quick word from our sponsor.

Break: [00:14:07].04] to [00:14:51].20]

Theo Hicks: Alright Larry, what’s the best ever book you’ve recently read?

Larry Abramowitz: I would say “Traction: Get a Grip on Your Business” by Gino Wickman.

Theo Hicks: If your business were to collapse today, what would you do next?

Larry Abramowitz: I would just keep on hustling and finding another deal to keep on going. You’ve gotta just keep on going; get up and find your next opportunity.

Theo Hicks: How would you start over if you had little or no capital?

Larry Abramowitz: If I had little or no capital, I would look for either deals where I could get seller financing, or just talk to friends and family that will be willing to fund some of the deals to get started again.

Theo Hicks: What is the worst deal you’ve done?

Larry Abramowitz: I bought a house from the bank in foreclosure for 70k, and when we ended up starting the work, all of the wood frame was eaten by termites, so I had to basically redo the entire house – gut it out completely and redo it. Luckily, I bought it cheap enough that I still made money at the end, but it’s been a year and a half in that project. It’s been a drain.

Theo Hicks: And then lastly, what is the best ever place to reach you?

Larry Abramowitz: The easiest way to reach me is by email, larry@broadviewcap.com.

Theo Hicks: Alright, Larry, thanks for coming on the show today and speaking with us today about your first syndicated deal. I know a lot of listeners are interested in syndications, so I’m sure it was great from their perspective to hear the entire story behind someone who recently did their first deal.

Just to summarize what you discussed – you actually found this property while you were interviewing property management companies, and they ended up sending you two off-market deals about a month after your conversation, told you you had two days to decide which one you’re gonna buy, so you quickly god in your car, drove to both of the properties, looked at the numbers… And you said that your reasoning for disqualifying one and selecting the other one was due to the location of the first one – it wasn’t on the main street, and it had a larger property across the street that was going through pretty heavy remodel… Whereas the one you ended up buying was on the main street, had a lot of visibility, it was a really good-looking property and you identified that there’s a lot of value-add there because of the rents.

We talked about how you were able to raise capital for that deal. You put in some capital, the property management company put in some capital, which was great from an alignment of interests standpoint… But you basically said that you put together a package and just hustled – you called everyone that you knew, and you also set that 100k minimum, which helped you hit that raise of 4.5 million dollars.

Then – this was a key piece of advice – if someone said no, you didn’t just hang up;  you asked them “Okay, do you know of anyone else who might be interested in investing?” And you talk with that person, and if they say no, you ask the same thing, and eventually you get to the point where you find someone who will invest.

We talked about the fact that you are actually beating your projections, and the biggest challenge aside from raising that capital was the fact that the closing kept getting pushed back… And one lesson that you learned was the need to communicate that with investors moving forward. Once you realized that, you sent them emails every two weeks.

And then lastly, about that deal, we talked about why they actually gave you the deal over other people, and that was because the property management company was in a situation where they needed to diversify, because one of their clients had sold off a large part of their portfolio, which made them lose a lot of their business.

And then lastly, your best ever advice was simple, yet powerful, which is just the power of networking and talking with as many people as you possibly can, because that will increase the amount of opportunities you receive.

Larry, thank you again for speaking with us today, thank you for everyone who listened. Have a best ever day, and we’ll talk to you soon.

Larry Abramowitz: Thanks. It was great being on the show, thanks for having me.

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JF1706: Transitioning From 100% Passive Real Estate Investing To 100% Active #SkillSetSunday with Lennon Lee

Today we’ll hear a case study from our guest Lennon, about how and why he started as a passive investor, and transitioned into active investing. Lennon actually started out with the intention to be active, but used the passive route to learn the business a little while getting returns on his money. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!


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“I wanted to be active but learned the business by being passive” – Lennon Lee


Lennon Lee Real Estate Background:

  • Founder of BLD Capital Group
  • Has been involved in the acquisition of over 1,500 units of multifamily real estate with an approximate market value of $150 million
  • Based in Miami, FL
  • Say hi to him at https://www.bldcapitalgroup.com/


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Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast, where we only talk about the best advice ever, we don’t get into any of that fluffy stuff. With us today, Lennon Lee.

First off, Best Ever listeners, and Lennon, I hope you’re having a best ever weekend. Because today is Sunday, we’ve got a special segment for you called Skillset Sunday. Today’s guest, Lennon, has gone from being 100% passive to 100% active, and he’s gonna talk about how he did that, so that if you choose to take that path, well, you’ve got a roadmap. Hello, Lennon.

Lennon Lee: Hello! How’s it going, man? Thank you for having me on the show. It’s my pleasure… It’s been a couple of years I’ve been on the other side as a Best Ever listener, and now I’m glad to be on this side, sharing some tips and knowledge and lessons learned.

Joe Fairless: Yeah, I’m looking forward to it. I’ve known Lennon for 3-4 years or so, and I consider him a friend of mine. And yeah, you’ve been a listener to this show as well, but then a little bit more about Lennon – he’s the founder of Build Capital Group. He’s been involved in the acquisition of over 1,500 units of multifamily real estate, with an approximate value of 150 million, both as a limited partner, as well as a general partner, in varying degrees. He is based in Miami, Florida.

So you started out as a passive investor 100%, and now you are an active investor 100%. The outcome for our conversation ideally would be for the listeners who are looking to be more active, but are currently passive, to give them some tips along the way, based on lessons you learned from going passive to active. What’s the best way to start out our conversation?

Lennon Lee: Well, I would say that in order to really understand not only the path of going from passive to active in multifamily, but I guess in life in general, if you wanna start a journey, I would have to say start with a goal in mind, and the dissect it, know what actions you need to take along the way, and then try to follow that map, even though it’s gonna change along the way… But if the goal is very defined, I think you’ll get there, one way or the other.

Joe Fairless: When you start out, you had the intention of being active, even though you were a passive investor.

Lennon Lee: Yes. When I started investing as a limited partner/passive investor in multifamily real estate, I did so with an operator that I essentially set out to meet and build a relationship with before I invested… But even before actually investing, I took the time to look at the asset class, understand all the trends and everything related to how it worked and how it was gonna be a good investment for me and my family… And I immediately said, “Well, I not only wanna be a passive investor here, but I wanna start my journey into actually doing the deals myself.” So yes, it was very clear from the beginning that I wanted to end up syndicating and sponsoring a big multifamily deal, and the first step that I took — and obviously there’s no right or wrong, but for me it definitely was the right step to take starting off.

Joe Fairless: And the first deal that you did passively – was that the one that you invested in one of Ashcroft’s deals?

Lennon Lee: Yes, correct.

Joe Fairless: Alright. I wanted to make sure [unintelligible [00:05:08].23] That’s cool, because I can think about it from my perspective when I was talking to you about that deal… So you were wanting to be active, but you wanted to first learn the ropes from a passive standpoint… So what are some things that you learned while investing passively, that you then used to transition into more active investing?

Lennon Lee: Well, initially, the main thing would be understanding how I wanted to be treated as a passive investor, because I knew eventually I would have limited partners or passive investors on the other side, that I would have to build a relationship with, communicate with, and provide education and everything in between… So I wanted to have that experience from that side of the business, of being totally passive; I wanted to understand as an investor first, because I did have some capital that I needed to move, and I decided to move it into multifamily… So I obviously wanted to get good returns, and I wanted to know my numbers, and everything.

So I would have to say that going as a passive investor first allowed me to not only start building a little bit of confidence in the asset class, more so beyond the educational part. I think that was the whole idea I wanted to understand first, before starting to get a little bit more active.

Joe Fairless: Did you choose the asset class and then find the operator, or did you find the operator, and then I was in multifamily, so then you decided “Okay, I’m gonna passively invest there”?

Lennon Lee: I chose the asset class first. I studied the asset class on itself, and I then actually started looking at the different strategies within the asset class, strategies that people use to invest, meaning actively buying a duplex, to syndicating 100, 200 or 300-unit deals. So I chose the asset class, then I started looking at the strategies, and I was trying to find the right fit for me and for my family’s capital, which was the passive investing side. Then I found out about syndication and how we had the opportunity to actually partner out with some proven operators that know the market and have done this, have done that, been successful at this… And I decided to go take that route.

Joe Fairless: So you invested passively in — how many deals did you invest passively in?

Lennon Lee: I invested passively, or as a limited — well, now I can’t say it is passively, but as a limited partner, I invested (I would say) on 90% of the deal that I’ve done, and I’ve done seven deals that I’ve been involved in… And I would definitely say at least six of them I’m a passive or limited partner in.

Joe Fairless: Okay. So you were a passive LP in six of them… And there’s a big difference from passively investing in a deal and learning things along the way, to actually putting an entire deal together and bringing your own investors. It’s an A to Z leap, so help us see how you went from A, B, C, D, E, F, G, H, I, J… All the way to Z. Because those are the two extremes, and a lot of people would love to learn about what you did to get there.

Lennon Lee: Yeah, definitely. The first thing I did was to get a mentor. In my case, it was [unintelligible [00:08:38].12] and in my particular case it was you and your consulting program… But in general I would say that’s a very, very important step to take. A lot of people are afraid to pay for mentorship, and sometimes they don’t believe it’s fair, but I do think there’s a lot of value in it, and it accelerates the learning curve on this business, which is a very sophisticated business, with all the moving parts that are going on… So that helped me.

So again, that intentionality of “Okay, I’m gonna start passive, but I wanna get there as fast as possible, to the other side”, and the step that I took was to actually get a paid mentor that was gonna show me the ropes and that was actually doing what I wanted to do at a higher level… And combined with that, two things. The key to the whole thing is based on the relationship-building, so focus on really building a trust-based relationship, because that focus allowed me to open the doors to actually starting becoming an active investor, joining the general partnership side of these deals, and bringing my investors, and then eventually building more and more partnerships, building a network, ending up choosing last month a 138-unit that we syndicated – that’s me and a couple partners.

Joe Fairless: So let’s dig into the trust-based relationships, because I think from a mentorship standpoint — well, alright, let’s dig into both of those components, but I wanna focus more on the trust-based relationships and learn exactly what you did there… But from a mentorship standpoint, what should people look for in a mentorship program, and what are maybe some things to watch out for?

Lennon Lee: The angle that I wanna tag this, I would say, is a little bit higher level… Because a lot of people have good practical advice on what to look for in a mentor, and that’s “Make sure you do a background check, and then get referrals, or a couple of phone numbers of people that have worked with that person that you wanna potentially work with… And not only talk to them, but then  ask them who they know that has worked with this other guy, so take it a little bit further”, and I think this is something that actually — I listen to Tim Ferriss a lot, and it’s something that he recommends, just to take it one or two steps further from that first referral that they gave you, to further your due diligence on the person. Check for their track record, understand their business model in terms of the numbers and the systems they have in place…

All that I think is fair and obviously it’s required – or should be anyway – but at the end of the day I believe that it boils down to trust for the relationship at a little bit more of a personal level that you end up building with that person… Because ultimately, there’s a lot of people out there teaching, or mentoring, or with coaching or consulting programs, that are very well prepared, they have a good track record, they have good systems in place, they differentiate themselves, they may be focused on different aspects of the business a little bit more… But ultimately, they’re all good people or good consultants or coaches. What you wanna do and identify is who you identify with in terms of “Okay, I understand this person has the integrity, and I trust this person more than I trust this other guy”, just because maybe you get along better.

I think that in my particular case that was very important… So that personal touch and personal feel to me was paramount, especially getting started. If you remember, Joe, I’m in Miami, and I actually flew to San Francisco, all the way there to meet with you in person, spend a couple days with you and understand who you were…

Joe Fairless: That’s right! I forgot about that. At Jay Martin’s conference.

Lennon Lee: Yeah, correct. Exactly.

Joe Fairless: Right! I totally forgot about that. Yeah, you did…

Lennon Lee: Yeah. So I look at it that way, and I identify with you as a person first… And then I got into the details, “Okay, let’s see what you guys have done. Show me your track record, how you do deals”, and all that. But only after I actually knew I liked you, and knew you had integrity, and everything else fell into place there.

Joe Fairless: So 100% passive to 100% active, what specific relationships — and I’m not looking for people’s names, but I’m looking for more roles… What roles do you need to fill in order to have the right team in place to be 100% active?

Lennon Lee: First of all, you need to understand what values you can bring to the table. In my particular case, luckily I had — like I said before, I was moving a small portfolio of properties that we had here in Miami, and I started to move the capital (or I had plans to move the capital) into multifamily… So I said, “Well, I have a little bit of capital that I can leverage”, so I built a relationship with local operators in Texas, Ashcroft Capital being one of them, the first one. Then some other partners in San Antonio; in that particular case, for example, they were needing someone to provide earnest money to get the deal to the closing table, or under contract, really… And they were able to offer me a partnership under that structure, where I bought the earnest money, I was helping them basically control the deal, and I actually joined the general partnership with them.

I also started raising capital from my investors network for that deal, and I started marketing the project, and working on all my ongoing investor relations on all those deals.

So there’s different aspects for the deal… Like, if you don’t have the capital, maybe some people come in and say “Well, I have the deal, but I don’t have the experience”, so you can join forces with a more experienced group.

For example, marketing – there’s a lot of groups out there that they’re very good operators, but they may be a little bit lacking in terms of their marketing strategies, not only for their company, but for certain materials, for sending the investments, and the PPM, and all this… I’ve known people that are actually very good at marketing, and design, and all that, and they bring this value to the table and say “Well, if I can get on the partnership side, even if it’s with a small share, I can actually take care of all your investor presentations, to make sure or to try to guarantee that you’re gonna have a better result when it comes to capital raising.”

Joe Fairless: I never thought about that. Thanks for bringing it up. I’ve never thought of a passive investor using their marketing skills to get in on a GP side to help an operator who’s already got some track record, but they need to maybe shift their focus from institutional money to private, high net worth individuals, or they just wanna scale their network. That’s interesting.

Lennon Lee: Yeah, exactly. So I think the key is to really understand at what level the operator or the syndicator that you’re trying to partner with is at in terms of “Okay, do they really need capital? Because I can raise a little bit of capital… But maybe they’re not looking for that.” Maybe they’re an old-school company, they have all the money they need, but they probably need a little bit of help with the marketing aspect. If you do the deal right, you might be able to get a share of the general partnership and get involved through that avenue. So again, there’s different avenues; in my particular case it was raising capital from my network, and providing some earnest money deposits, and all that, for these deals.

Joe Fairless: So you leveraged what you could bring to the table, and then you used that as a way – which was money for earnest money – to then get in the general partnership. But in order to come across that opportunity, you met them through the mentorship program, right? Those guys…

Lennon Lee: Yeah.

Joe Fairless: Okay. So you joined the mentorship program, then you networked and built relationships with people, and then people in that program had a need, you had a way to fill that need, so you got in a deal… So now you’re from 100% passive to — okay, now you’re getting more active; you got in a deal, through selling some properties to bring that earnest money… And also, now that you’re in the deal, you can bring your investors into the deal, because you’re a general partner in the deal, so then you became even more active, because you’re now bringing investors into the deal…

So at this point in time you’re partnering up with a group on a deal… And then how do you make the evolution from being invited into a deal, versus now you’ll want to have the deal yourself, and put all the pieces in place? How did you get to that point, make that jump?

Lennon Lee: Well, it’s all relationship-based, and obviously, as you get more active in the industry, you’re gonna start building relationships and networking with people that are at your same level, and that have similar goals and a similar vision for their company. So if you have the intention, you’re gonna eventually end up finding the right partners.

And the beauty of our business model, if you will, meaning the way we acquire properties via syndication, is that the structure is very flexible. You can do a deal with a few partners, and then the next deal – you can do it with different partners, until you actually maybe find a partner or a group of partners that you wanna stick with for more years… But even then, you always have that flexibility.

In my particular case, I first didn’t have the want of actually being an operator myself, but instead I liked the part of being on the investor relations side and equity raising. So I said, “Well, for now I’m gonna continue to do deals on a somewhat-active…”, meaning that I’m active because I’m raising capital, doing marketing, investor relations and all that, but I’m not talking to brokers, and finding deals, and underwriting myself. So I’m gonna stick to that, because I always look at everything that I do from a passive investor perspective first, because that’s what I am first… So I wanna set out to build what I like to call “a curated network of operating partners”, with whom I could under the same structure and flexibility partner up with on the GP side, and do more deals, and offer my investors the opportunity to actually not get stuck with just me as an operator… When I have my deal – okay, we’ll get it done, but we also have these other partners that we work with.

So the way I ended up actually doing and pursuing a deal and syndicating a deal was by sheer luck. I started talking with a friend out of Dallas, actually… We started talking about marketing, how to put together a thought leadership platform for immigrant investors, or for the millennial-type investors… That was the first conversation. And we actually ended up understanding that we had different skillsets; he was more on the financial and underwriting, and he was very active on building broker relationships and all that, and I was more active on the other aspect of the business… So we understood “Okay, we might have something here.”

We later started talking with our third partner. He was actually one of my first investors on the first deal that I participated in as a general partner.

Joe Fairless: What did you need him for?

Lennon Lee: Well, basically my first partner and I, younger guys, very active and oriented more (me personally) on the marketing side, in that aspects, and my other partner was on the financial side… So we needed someone to bring, first of all, the grey hair to the table, that obviously provided credibility to our team… Because he has a very, very good track record of being involved in businesses and in the  corporate world as well. So he brought the balance to the table, and a lot of the processes and systems building knowledge that is very important in our business. So he complemented what we were lacking, and that partnership came to fruition and we were able to start focusing on a particular market that we liked, then we built a broker  relationship, built a team, until we found the right deal, and then we were able to get it under contract.

Joe Fairless: So that is how you went from 100% passive to 100% active. Lennon, how can the Best Ever listeners learn more about what you’ve got going on?

Lennon Lee: Well, I’m really active on Instagram. The handle is @themultifamilyinvestor. But I actually also wrote an eBook recently that I would like to share with the audience. If you go to bldcapitalgroup.com, you’re gonna be able to download the free eBook. It’s specifically written more for the passive investor, that’s starting; it’s gonna save them a bunch of learning time. And not only will they get the eBook, but we’re doing actually bi-weekly newsletters that basically take the concepts that we learn in the eBook and we talk about how we’re either applying them on our active deals, but also lessons learned from that. Basically, it peels the lid back on all the concepts that we share in the book. Again, that’s bldcapitalgroup.com/join.

Joe Fairless: Awesome. Well, Lennon, thank you for being on the show, talking to us about the importance of trust-based relationships, as well as getting yourself in a community. So first, knowing what you want; start with the goal in mind, as you said. Then get yourself connected with a community of people who are doing what you wanna do, build trust-based relationships with them, identify what value you can bring to the table, then bring it, and continue to build those relationships and put the pieces in place.

Thank you so much for being on the show. I hope you have a best ever weekend, and we’ll talk to you soon.


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Joe Fairless and Alan Goldstein on a flyer for the Best Ever Show

JF1571: Pay Less Taxes & Perform Proper Cost Segregation Studies with Alan Goldstein

For those that don’t know, cost segregation is a way of deferring taxes, usually reserved for larger, multi-million dollar properties. However, Alan and his firm perform the studies on smaller properties – even single family homes, if it makes sense for the investor. Find out why and when a cost segregation study would make sense for you. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!

Alan Goldstein Real Estate Background:

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Sponsored by Stessa – The simple way to track rental property performance. Get dashboard reporting, smarter income and expense tracking and tax-ready financials. Get your free account at stessa.com/bestever


Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any of that fluffy stuff. With us today, Alan Goldstein. How are you doing, Alan?

Alan Goldstein: Fantastic. And yourself?

Joe Fairless: I am fantastic as well, and welcome to the show. A little bit about Alan – he is a CPA and also has been working with cost segregation studies for over 20 years. He’s also a general contractor, a mortgage broker, a real estate broker and an IRS enrolled agent. He is based in Miami, Florida. With that being said, Alan, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?

Alan Goldstein: Sure, absolutely. My background is in real estate, as a real estate investor, as a real estate broker, and representing taxpayers that have problems with the IRS, and state taxing authorities… And during the course of my work, I stumbled upon cost segregation for one of my clients, and here we are.

I live in Miami, Florida, with my family, and I do business all over the U.S.

Joe Fairless: What is an IRS enrolled agent exactly?

Alan Goldstein: An IRS enrolled agent is an individual that has taken certain exams from the IRS, and then they’re allowed to represent taxpayers in front of the IRS – tax returns, administrative hearings, audits, appeals, that type of stuff.

Joe Fairless: Okay. So if someone is a CPA, do they in addition, in order to do what you’ve just said, have to do additional tests in order to represent people in front of the IRS?

Alan Goldstein: Absolutely not, because the IRS is federal law, it’s not subject to state law. What that means is that if you’re a CPA in Georgia, you can represent someone in California. But most CPA’s end up getting both licenses, that way there’s no confusion, there’s no issue, because a CPA license is state-issued, so some people get very confused. An enrolled agent license is a federal license.

Joe Fairless: What are some typical issues that your clients have with the IRS, where you have to represent them?

Alan Goldstein: 1099 earners are notorious, I would say. That is the bulk of the work. What I mean by that is, for instance, real estate agents and brokers, if you get paid on a 1099, you end up having cashflow issues because you might not have a lot of closings in the pipeline, so by the time something closes, you’re out of cash already, you decide not to pay your quarterly estimated tax payments, and then you end up in trouble with the IRS at the end of the year because you’re gonna owe all of this money, and you don’t have the money to pay it, and then you might get audited, or a lien, or whatever the case may be.

Joe Fairless: In that case — and clearly, if someone is not doing their quarterly estimated tax payments and then you have to represent them, how much can you really help them during the representation?

Alan Goldstein: Well, it depends on the issues involved, obviously. In a situation like this, it depends on the compliance history of the taxpayer, meaning are they doing this every year? Are they ignoring letters? Are they making fun of the IRS? If you have a good profile, then what you can do is obviously the penalty removals if you have a good profile, and enter into some sort of installment agreement where you don’t have to pay all of that money back. A lot of people get worried because they think you have to pay it back.

On the topic of installment agreement, that is the one place where the majority of people mess it up. They say “Well, I can do it myself.” No, you can’t, because a standard form – sure, you can fill out, but there’s additional benefits that are afforded to you that you don’t make use of. So you always wanna have a professional, whoever you decide, to complete the form accurately, because the better the form is completed the better financial picture you have for the IRS.

Most of our clients we end up either not paying anything, or we end up with very low monthly payments, even if they have the money to pay back the IRS, and that’s a form of like a loan with low interest rate for the taxpayer, because they didn’t get to pay that money.

Joe Fairless: What are some of those additional benefits that you mention?

Alan Goldstein: Additional benefits is for instance a full deduction of your property expenses. A lot of people forget things like pest control, pool maintenance, things like that.

As far as an investor is concerned, they have all sorts of things that they can deduct as expenses that they do not list. You have your property insurance, you have all your maintenance, you have everything… And the key is to show the IRS that you’re paper-broke, so that way you pay the least possible or you pay nothing at all.

Joe Fairless: A lot of your focus – correct me if I’m wrong – is on cost segregation; is that accurate?

Alan Goldstein: That’s 100% accurate. We had a major, major accounting firm, and we sold off the part of the accounting work and the tax returns and all that, so we solely specialize in cost segregation and investment advice for real estate, and anything to do with that. If we have to do the return because of the cost segregation, because a lot of professionals do not have an accountant to help them with that, then we will gladly do that also.

Joe Fairless: And from a business standpoint for you all, why focus your efforts on cost segregation?

Alan Goldstein: That’s a very good question. Cost segregation is not used by many people because they either don’t know about it, or it’s reserved to the rich. During the course of our work, I said “Wait a minute, the majority of our clients are not aware of this”, and doing a cost segregation report is a black and white, tangible way to extend your cashflow for your properties… So we said “This we’ve gotta bring to people, because you mostly hear cost segregation with big commercial projects, a 100 million dollar building”, and yeah, it applies to that, but it also applies to the single-family residence. It also applies to a four-unit, a five-unit, a ten-unit, and a lot of people do not understand that.

Joe Fairless: So how does it apply to the smaller properties? Or, perhaps a better question is why do you think people believe it doesn’t apply to smaller properties, compared to larger ones?

Alan Goldstein: Because most of the research that’s done — when you go online and you search, most people that do cost segregation, they focus on the commercial side of it, because there’s more money involved, so a lot of people do not understand that. Or, for instance they’ll contact a company and then the company would say “Oh, it’s single-family, it’s not worth it.” That’s not true. The problem is that that particular firm charges so much that when you do the numbers, it does not make sense. So that’s why you do a cost-benefit analysis, which says “What is the basis of your property? What year did you buy it?” and then you do a report and you determine if it’s worth you doing the cost segregation report or not.

Joe Fairless: So what’s the basis of the property, what year did you buy it, and then when that report is conducted or completed, what is the determining factor on if it should be moved forward or not?

Alan Goldstein: The amount of taxation that you save, and the amount of depreciation that you accelerate. For instance, I’ll give you an example – if you do a 2018 cost segregation report, but you bought the property in 2010 (this is an actual case, by the way), you have an additional (for 2018) $683,000. This is on a 1.6 million dollar property… You have an additional $600,000 that you claim in 2018 for the previous depreciation you didn’t claim, plus $240,000 for 2018.

As you can see, that’s a huge amount of money that you take in depreciation. You don’t pay taxes, or if you pay taxes, it’s very little, and then you can use it against other type of income that you have.

Joe Fairless: And when reviewing that — first off, who conducts that study, and then from a layman’s standpoint… Perhaps someone who has a couple smaller properties, how should they go about assessing that report, so that someone who doesn’t have as much experience can figure out if it’s a go or a no go?

Alan Goldstein: Sure. On our website you have a free calculator that gives  you the basic breakdown of it, and then a list by property – whether you have a farm, whether you have a commercial property, single-family, multifamily… And you click on that particular calculator and you enter your basis, and then it gives you the breakdown. It would tell you “For this year, you’re gonna claim x amount of money on deduction.” That way, the person knows if it’s worth it or not. That’s the first step.

Then the second step is where we do a more detailed cost-benefit analysis, at no cost – most companies offer that at no cost – and then it will give you a further breakdown of exactly per-year what the amount is of depreciation, and then you make a decision, how much are you gonna spend versus how much are you gonna save, and if it’s aligned with your goal for whatever you’re gonna do.

Joe Fairless: I’ve talked to some investors about this; they have their own portfolio, and they say essentially that cost segregation and 1031 exchanges – it’s fine, but it’s like kicking a can down the road. You’re just delaying the inevitable. What’s your response to that?

Alan Goldstein: That’s not completely accurate. One area that people miss – the misconception out there is that most accountants do not understand what is asset retirement and partial asset dispositions. What that means is that a typical asset class, based on the IRS table – for instance, let’s say a satellite installed on a house (something simple)  has what is called a class life, versus the years that you can depreciate. Let’s say you get ready to sell your building or your property or whatever – once that’s done, and has there been any changes or anything, your accountant has to do a partial disposition calculation, which would tell the IRS exactly what that asset (that satellite dish) is worth at that particular moment in time. What does that mean? That means that maybe it cost you $500, but when you dispose of the property it’s only worth $5. So you use that difference, adjust your basis, and you end up either not paying any taxes, or paying very little taxes. That’s called a partial asset disposition, or asset retirement; different people call it different things. And that’s linked to the PPI (Producers Price Index) for the moment in time that we do the report.

Joe Fairless: Got it. So in that example it’s not kicking the can down the road, because you’re actually saving money when you sell, based on the asset’s value at that point in time, according to the tax code.

Alan Goldstein: Absolutely. And then you also have the additional strategies, which is — for cost segregation you have two ways of doing it. You can deduct everything in the year that you do the report, or you can go back and amend your returns and get all of that money back. So either way, whatever money you save or the money you get back, what most investors do is reinvest that money into properties. That way you don’t end up paying taxes, or you pay very little taxes, because you reinvested that money.

What I mean by that is let’s assume that you invest in a property that the return is greater than whatever you would have paid to the IRS, then you end up paying no taxes in those transactions.

Joe Fairless: And what about the same comment, kicking the can down the road, so not worth doing, on 1031 exchanges? What are your thoughts on that?

Alan Goldstein: A lot of investors use 1031; in fact, sophisticated investors, and by that I mean 20 million, 50 million, 100 million transactions. They actually use the cost segregation, and then the disposition studies, of course, and then the 1031 exchange in order to avoid paying taxes. So it works out really nice. There’s a lot of samples online, sample case studies, and things like that.

Joe Fairless: That’s in order to avoid paying taxes today, but the argument for someone would be “But I’ll eventually have to pay it, so I’m just delaying the inevitable.” Any comment to that?

Alan Goldstein: Well, no, it’s not completely accurate. The reason is because of the study of the disposition. And it’s not that, for instance, you save $100,000 in taxes today, but you sell the property five years and you’ve gotta pay those $100,000. That’s not correct at all, and that’s a common misconception. What people do is when they decide to sell, they go ahead and they do these disposition studies, and based on the assets at that moment in time, you end up paying nothing. And even if you do, it’s ordinary income, which is a way lower tax bracket, so it’s really not a point.

I mean, who wouldn’t this be good for? I guess that’s a good question… It’s someone that just loves to flip houses. If you come to me, for instance, and you say “I flip houses for a living”, well, that’s kind of an issue, because if you flip houses, you’re not long enough in it to take advantage of it, and besides that, the accounting work involved is humongous. So that wouldn’t be a good fit for a flipper.

But if you’re an investor and you have a certain exit strategy, you can actually incorporate all of the calculations into your exit strategy and see what it would look like ten years from now, or five years, or whatever your exit strategy is.

Joe Fairless: Based on your experience working in the industry, what is your best advice ever for real estate investors?

Alan Goldstein: To educate yourself and to partner with someone that has already gone through the steps. I have a saying, I always say “Birds of a feather flock together.” When you start investing, or anything you do in life, you usually end up hanging around your own kind. So what you wanna do is you wanna start accessing where you wanna go, not where you’re at. What I mean by that is let’s say your end goal is a 50 million property, or whatever amount. You wanna start dealing with people that are at that level, because they will cut your time to get to that level and they will show you things that you’re not aware of. For instance, cost segregation… There’s just so many things that you do.

For instance, one problem that I see all the time is that if you go to an unprepared professional that does not know about real estate and they do your returns, a lot of times they put these properties under schedule C, which subjects you to self-employment tax, which does not apply when you’re an investor.

In those cases, you have to amend, put them on schedule E, and all of these things. So you wanna go to someone that that’s all they do. It’s like a doctor… You go to the doctor, your general practitioner – sure, they studied anatomy and physiology, but they’re not specialists let’s say in the heart, so you wanna go to a cardiologist. The same applies to real estate – you wanna be in a team that that’s all they do.

Joe Fairless: We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?

Alan Goldstein: Absolutely.

Joe Fairless: Alright, let’s do it. First, a quick word from our Best Ever partners.

Break: [00:19:13].20] to [00:20:27].05]

Joe Fairless: Okay, best ever book you’ve recently read?

Alan Goldstein: Millionaire Mindset for Investors.

Joe Fairless: Is there a book that addresses cost segregation that you would recommend?

Alan Goldstein: No. What I would recommend is an actual print-out on the IRS website, which covers cost segregation in great detail, better than any book that touches on the subjects.

Joe Fairless: How quickly does that put someone to sleep?

Alan Goldstein: I would say by the second paragraph. [laughter]

Joe Fairless: What’s a mistake you’ve seen an investor make in your business that we haven’t talked about already?

Alan Goldstein: I would say mostly the deduction on schedule C versus schedule E, or any of the other forms.

Joe Fairless: And if you were to summarize your strategy, or really your expertise in how you help investors, how would you summarize that?

Alan Goldstein: Well, obviously the cost segregation, but then they also need to look at other sources, such as cashflow from rent, cashflow from rent increases, other sources like storage, laundry, parking upgrades, strategies to buy below market, and the upgrades and how is that gonna play into the appreciation of the property, and the mortgage amortizations issue. Those are areas that really need to be covered.

Joe Fairless: Best ever way you like to give back to the community?

Alan Goldstein: I donate a lot of money and a lot of time, representing for the local pro bono area here, where we have cases for the IRS and the people do not have any money… So we go ahead and represent them on behalf of the legal aid and get things resolved for them.

Joe Fairless: Best way the Best Ever listeners can learn more about what you’re doing?

Alan Goldstein: Best way is by contacting our website, cashflow179.com, or doing research on the IRS website regarding cost segregation.

Joe Fairless: If you don’t know what partial asset disposition is – well, now you know, and you can go learn more at Alan’s website, which is in the show notes page.

Alan, thank you so much for talking to us about cost segregation, talking to us about 1031 exchanges a bit, and then overall strategies for how to approach it as a real estate investor to minimize the greatest expense that we have, which is taxes… So thanks for being on the show. I hope you have a best ever day, and we’ll talk to you soon.

Alan Goldstein: Thank you, it’s an honor. Take care.

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Guest Eric Jacobs on Best Ever Show episode 1434 flyer

JF1434: Systems And Processes To Help You Build A Large Real Estate Business with Eric Jacobs

If you’re an investor who is looking to build a sustainable real estate business, this episode is for you. Eric gives us some of his systems he’s created that have helped him get to where he is today. From hiring team members to how he spends his time everyday, great tips are in store for you in this episode. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!


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Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any of that fluffy stuff.

With us today, Eric Jacobs. How are you doing, Eric?

Eric Jacobs: Hey, Joe.

Joe Fairless: Welcome to the show. A little bit about Eric – Eric is a real estate lawyer, and he’s also got an MBA. He coaches and consults with real estate investors. He’s been in real estate since he was 18 years old, and he owns some real estate, but focuses now on hard money lending. Based in Miami, Florida. With that being said, Eric, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?

Eric Jacobs: Sure. Hey, Joe. Thanks again for having me on the show. Again, I’m Eric, I live in South Florida. I’m a bit of a serial entrepreneur. I used to be a real estate broker, owning a real estate brokerage. I sold that in 2006, thank God.

These days I’m currently running a title company that I built an ultimately sold to a Fortune 500 company about a year ago, and on the investing side, I do own some investments myself, but I’m really kind of keeping my powder dry… We get ready for some opportunity down here in South Florida, and I’m kind of hedging my bets with some hard money.

I do have one 20-unit broken condo under contract right now… We’ll see if I keep it or flip it.

Joe Fairless: Cool. So hard money lending is your primary real estate focus right now, it sounds like… What type of deals are you working on?

Eric Jacobs: Well, I guess my primary focus right now is being president of this division of this large company, but in addition to that I’m also a real estate attorney, and then I do the real estate lending.

On the lending side, generally what we like to see is an entity looking for bridge financing, usually a year or so. 60%-65% LTV, and just a good, solid transaction, a good, solid piece of property in [unintelligible [00:02:45].00]

Joe Fairless: Got it. So it doesn’t sound like that’s your primary focus. So you said president of a large company – what large company are you referring to?

Eric Jacobs: I’m the president of Clear Title Group. That’s a title company that we built from the ground up and almost a year ago now sold to a Fortune 500 company; they kept me on, I’ve continued to run it, and I’m working with the great folks there as well.

Joe Fairless: Got it. That’s the point I missed. When you said you sold it, I didn’t know you were still doing it. So you’re the president of Clear Title Group, you sold it to a Fortune 500 company, you built it from the ground up… What are some things you’ve learned along the way?

Eric Jacobs: Well, I think being a serial entrepreneur and being involved in a lot of things, I think my primary takeaway and the real value that I’ve tried to convey to people that I work with in consulting is that it’s really all about systems. I come across people every day that have businesses that are really very little more than their own job, where they’re their own employer… But if you really wanna build something, you need to build systems to go along with it. That’s really been my takeaway – it’s the systems that I sold, more than companies.

Joe Fairless: Can you elaborate on some specifics about some systems that you sold along the company, just to help us crystallize that?

Eric Jacobs: I think even if you look back at the real estate brokerage business that we had, we came in, we started from scratch… We were not one of the big brand name real estate companies, so we didn’t just kick the doors open; we had to find a way to be something different.

I myself did not go on listing appointments, I did not recruit agents; I built a platform that allowed me to bring people in that would recruit agents for me, and people that would go on listing appointments for me.

The title company is very much the same thing. I don’t often do a lot of closings on my own; I have a team that does that, I have marketing people that do that… And basically, what I do is I consider myself something of an air traffic controller, making sure that all the system’s right.

I’m sure, Joe, you obviously have a lot of systems yourself to be able to do the longest-running podcast ever, and have a business life on top of it… Something pretty incredible.

Joe Fairless: When you built a platform with your title company, what were some of the challenges when putting in the systems that perhaps others will come across and will just assume they’re also building a title company?

Eric Jacobs: Well, at least I can speak [unintelligible [00:05:02].19] I struggled with through a couple of companies was I often either tried to do too much on my own, or I hired people because I liked them, and I think both of those are not really necessarily recipes for success, and certainly not for scalability.

When it comes to trying to do everything yourself, when you start building a little company – and this is whether you’re in real estate investing, or brokerage, or anything – presumably, what it is that you do well gets you some degree of success, and then you hire people and it becomes so easy to try and hang on to all of it, instead of hiring great people and letting them go, and let them do their thing… And sometimes you find that they may do it better than you did it.

Sort of related to that, hiring people that I like, my interview process used to be 10 or 15 minutes; I’d get in a conversation, we’d chuckle a couple of times, and if I had a good vibe about them, I’d hire them… And I think it was Peter Drucker that said “Culture beats strategy every time”, and I believe that culture is incredibly important to a successful organization.

Having good chemistry and good fit isn’t all there is.

Joe Fairless: So what are some specific things that you ask or look for during the interview process, that you didn’t before?

Eric Jacobs: Well, the first thing that I do is I give them something of a personality test, I give them a basic skills test, and then I have some very specific questions about mistakes that they’ve made. I try to discipline myself to spend a lot of time talking about how they deal with adversity, mistakes that they’ve made, how they’ve overcome it, so that really it puts them in a position of having to talk about something that is naturally uncomfortable.

I think when you get people talking about what’s uncomfortable, you kind of learn a lot about them. That really can help you to understand if that’s somebody that you can set free and really benefit your business.

And then of course, there’s the natural questions about where I want them to get me… So if I’m hiring somebody for digital marketing, for example, I really wanna give them an opportunity to talk about what they could do for me, not just sit there and tell them what it is that I want them to do,

Joe Fairless: How do you get below the surface of a typical canned response of a challenge that they had? …where – okay, they saw it coming, they answer the question about a challenge or mistake they made, and you didn’t feel like you really dug in deep enough, but they did answer the question.

Eric Jacobs: I think you have to be really comfortable with the word Why, and I think moments of silence are really powerful in an interview. I think sometimes when you ask somebody Why and you just sit there – that’s hard to prepare for. I think people have difficulty anticipating you asking them why they did something… They canned that answer (I think we’ve all done it at one time), but when you force them to really think about and examine why, I think your BS meter will go off pretty quick if they’re just trying to work their way through it.

Joe Fairless: Switching gears, you mentioned you’ve got a 20-unit under contract – not sure if those were condos… And there was something else about the condos – you’re not sure if you’re gonna flip it or close on it… Can you elaborate?

Eric Jacobs: Sure. We have 20 units in a 35-unit condo building currently under contract. I refer to it as a busted condo. I saw an opportunity almost by accident. It was one little unit  that was lifted… In the context of doing kind of my pre-offer due diligence, I noticed that a lot of the units in the building were owned by the same entity.

A busted condo is a condo that’s not really financeable, because one person/entity owns a substantial portion of the condo… So I saw an opportunity there. When I spoke to the broker about the one unit that was under, I asked him if his client would be interested in selling the entire portfolio. They said that they would.

We’ve gone under contract, and I think if we take it, the idea will be to try and acquire the other 15 units and privatize the building altogether. The reason why I said I might flip it candidly is it’s such a good deal that I think there’s a possibility that somebody may just take it off my hands, and I’m really more in an opportunistic sort of mindset right now, rather than the long-term decent return kind of play.

Joe Fairless: If you closed on it and  then the next step was to acquire the remaining 15 units, have you looked at how many unique owners there are of those 15?

Eric Jacobs: Yeah, and I don’t remember the exact number, but let’s say it’s probably 10-12 unique owners. I think most of them have been owners for a long time, so they’re from a value standpoint reachable… Whether they’re willing to sell right this minute or other time, I don’t know.

One of them is a potential problem, because they so incredibly overpaid for it right in the height of the market, and then yet they’ve apparently kept their mortgage current… But I don’t know how we would extricate them from that. Maybe we just have to overpay a little, I don’t know.

Joe Fairless: When you look at the time that you spend in business on a weekly basis, how is it divided up in terms of the types of tasks that you’re doing?

Eric Jacobs: That’s a great question. Right now, after having been acquired, I feel like I owe the people that acquired us the majority of my time… So I really would say that I devote most of my workday to continuing to grow and expand the title company and make sure that they feel happy about what they bought. That means a lot to me.

The rest of my time is spent largely to some degree directly running a law firm, and certainly vetting investments and hard money opportunities. Then I have a handful of consulting/coaching clients; it’s really something of a new thing for me, but I’m really enjoying it, and I’d like to think I’m bringing a lot of value to the handful of people that I’ve chosen to work with.

Joe Fairless: You said most of your workday is growing and expanding the title company. How do you do that?

Eric Jacobs: Well, we look at very specific markets, and then we determine whether we think we can bring something unique to the table. I’ll give an example – we have a location in a different part of the state of Florida that I think we’re  gonna move into next, and basically, we identified where we saw title companies that were not operated by a lawyer, where there were high dollar transactions, and how many transactions we would need to break even… And we see a real opportunity. So we’ll probably gonna put another office there in the next couple of months, and then I think we’ll continue to do that in the high dollar markets of Florida for at least the next year or so.

Joe Fairless: And then on the consulting front, what do your clients hire you to do?

Eric Jacobs: To this point, most of my coaching clients have hired me to take them from being however successful a one-man operation or a one-man dominated show, to really beginning to scale and think about their business in a different way… And instead of working — it’s become kind of cliche, I guess… Instead of working IN the business, really helping them to learn how to work ON the business, and allow them to scale.

Joe Fairless: And you’ve mentioned the importance of systems with the couple companies that we’ve talked about… What are some concrete steps that you would walk someone through in order to go from being a one-person show to having a scalable company?

Eric Jacobs: Well, I think the first thing that people often don’t bother to do is to figure out what it is that they want. I think very often people start a company to start a company, and then the company begins to take a life of its own, and it begins to run them.

So I spend a fair amount of time really getting  a handle on what’s important, what priorities matter to the particular person that I’m working for. You may not want to acquire 500 million dollars in real estate and building an investing empire. Maybe you just want 8-10 duplexes for your retirement, but right now you wanna keep your existing job.

So not every formula is gonna work to get them where they wanna go, so I try to help them figure out what they want, and then we just kind of reverse-engineer it. If what they want is to acquire a substantial multifamily asset, then we begin to take apart the whatever number of tasks there are to doing that, and then it’s about holding them accountable and getting them to do those steps, even if it’s one at a time.

Joe Fairless: Based on your experience as an entrepreneur and real estate investor, what is your best real estate investing advice ever?

Eric Jacobs: Do it. You can walk into a medical library, read every book in there, and it doesn’t make you a doctor. At some point you need to stop talking and thinking and listening, and you need to get out of your own way and just do it. I think resources like this are very helpful, and are necessary. I think coaches are very helpful and could be necessary, but if you’re one of those people that are gonna find a reason not to do something, then you might as well stop reading and stop listening, because you can always find a reason not to do something.

Joe Fairless: We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?

Eric Jacobs: Let’s give it a shot.

Joe Fairless: Alright, great. First though, let’s hear from our Best Ever partners.

Break: [00:14:23].27] to [00:15:24].25]

Joe Fairless: Alright, best ever book you’ve read recently?

Eric Jacobs: Recently… Smarter, Faster, Better by Charles Duhigg.

Joe Fairless: Best ever deal you’ve done that we haven’t talked about?

Eric Jacobs: That we haven’t talked about… I did a fairly substantial hard money loan a couple years ago with a decent pre-pay, and I had another investor come in for leverage, and we ended up with a 20+ return in a very short period of time.

Joe Fairless: What’s a mistake you’ve made on a transaction?

Eric Jacobs: Oh, boy… This could be a long podcast. I tried really hard to convince somebody not to buy some property in the Bahamas. They bought it anyway. I went over there to visit, fell in love and I bought it, too. Then we both lost money together. [laughter]

Joe Fairless: What’s the best ever way you like to give back?

Eric Jacobs: I like to find people that are being given really bad advice or that have been exploited and I like to help set them on the right path.

Joe Fairless: What’s a piece of bad advice you’ve heard?

Eric Jacobs: Pay somebody a ton of money and in a weekend they’re gonna teach you how to become a multi-millionaire, first with wholesaling, then multifamily, then with BRRRR… And just over-promising and under-delivering in general.

Joe Fairless: And how can the Best Ever listeners learn more about what you’ve got going on and get in touch with you?

Eric Jacobs: The easiest way to reach me is e-mail. It’s Eric@EricJacobsConsulting.com. I’d love to hear from them, and I sure appreciate your time.

Joe Fairless: Well, thank you for being on the show, talking about the systems that you’ve implemented in the companies we discussed, and how someone can implement the approach that you talked about, from being a one-person show to having a scalable company – three steps. First, you’ve gotta know what you want; two, reverse-engineer, and three, being held accountable every step of the way. I know that there are many sub-bullets underneath those, I’m sure, but from a high-level, that’s the three-step process.

Then also talking about how to select the right employees as you scale the company, getting comfortable with silence, asking the question Why multiple times, as you dig deeper and deeper when discussing a mistake they made or adversity they came across.

Thanks for being on the show. I hope you have a best ever day, and we’ll talk to you soon.

Eric Jacobs: Thanks, Joe. You too.

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Brett Ratkowski and Joe Fairless on the Best Ever Show ep 1430 flyer

JF1430: From Getting His Butt Kicked In To Helping Top Realtors With Their Business with Brett Ratkowski

If you’re anything like most real estate investors, you’ve failed a time or two. If you haven’t, well you probably will at some point. Listen to this episode to hear how we can bounce back from a mistake, both big and small. We also get to hear how Brett is using FB ads to grow his business and other top realtors businesses. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!


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Brett Ratkowski Real Estate Background:

  • Went from a Broke Real Estate agent sleeping on my sister’s couch and having my car repossessed, to building up a 6 figure Real Estate business primarily with Facebook Ads
  • Turned my passion for Facebook ads into a business
  • Launched Optimized Real Estate managing ads for top Realtors
  • Say hi to him at http://optimizedrealestate.com/
  • Based in Ft. Lauderdale, FL
  • Best Ever Book: Think and Grow Rich

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Joe Fairless: How are you doing, Best Ever listeners? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any of that fluffy stuff.

With us today, Brett Ratkowski. How are you doing, Brett?

Brett Ratkowski: Good, how are you?

Joe Fairless: I am doing well, and welcome to the show. A little bit about Brett. He went from being a broke real estate agent, sleeping on his sister’s couch – boy, that just sounds ridiculous; I’m so glad that you are no longer doing that… And you had your car repossessed – double doozie – to building up a six-figure real estate business, primarily with Facebook ads. You have launched Optimized Real Estate, which manages Facebook ads for top real estate agents… But clearly, this is also relevant for anyone who wants to acquire customers through Facebook ads; we’re gonna be talking about that.

He’s based in Fort Lauderdale, Florida. With that being said, Brett, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?

Brett Ratkowski: Yeah, absolutely. I want to thank you for having me on the podcast today; I’ve been following you for a little bit, so it was actually a pleasure when you guys reached out to me.

So I started in real estate in 2012. I actually activated my license then. I got my real estate license back in 2005. Working part-time… At the time, I was working in the restaurant industry and decided to go full force, and man, did I get my butt kicked in; I don’t know if I can curse on here or not… But I got my butt kicked in pretty hard the first two years. It took me 18 months to even close my first sale.

After I closed my first sale, I went full-time and just continued to get pounded. Luckily, I had some money set aside, and then it was all gone. I spent my last pretty much $500 — I was down to $5 in the bank account, and I took one of my mentors’ training programs… Joshua Smith, out in Arizona – I took his training course, learned how to actually grow and scale a real estate business, took some of the strategies he had and some of the strategies I was doing with Facebook, implemented them, and things just started blowing up.

I maxed out on my credit cards though in the meantime, but within six months after his course and really diving deep on Facebook Ads did I see that return and started to see my business grow and scale to where it is today.

Joe Fairless: We’re gonna focus on the growing and scaling part, but just to add more context to the dark times, what were some things that you were doing wrong?

Brett Ratkowski: So doing things wrong – one, I had a hobby; I didn’t have a business. I didn’t know my numbers inside and out. I was generating leads, but I wasn’t following up with them. I wasn’t holding open houses, I wasn’t doing anything, to be honest with you… If you really want to break it down, I wasn’t doing anything that was dollar-productive. I was going and meeting with lenders, and getting coffee, and going to the office and chatting around the water cooler, and… I guess our office calls it the coffee cooler, but… Not doing the right things, just because I wasn’t taught the right way.

The broker that I was with at the time didn’t have any training in place. I was a newer agent, so I didn’t know. They don’t teach you in the real estate school what to do… So once I actually spent all my money on my own coaching is really when I actually got step-by-step implementation of what to actually do – holding open houses, and just calling your sphere your influence… Doing little things like that that I was not doing.

I saw everyone being so successful in real estate and I thought it was so easy I’d get into it and the deals would come, but I learned the hard way they didn’t.

Joe Fairless: At the time you had five bucks in the bank account… How much did the training cost when you had that much money, that you put on the credit card?

Brett Ratkowski: Well, I spent the last 500 bucks I had cash on that…

Joe Fairless: Oh, okay.

Brett Ratkowski: The course was $1,000. I was on a team at that time here in Fort Lauderdale, and the team leader at the time, he was buying in the course, so Joshua allowed us as teams for multiple agents to be under one account on the training… So obviously, to have some skin in the game, that leader asked me to pay for it, and I had been following Joshua for a long time and I’m like “You know what, I have nothing to lose”, right? I already lost it all; I went through a bad breakup, I was sleeping on my sister’s couch, I had the car repossessed… And the funny thing about that is I was at my now finance’s house when the car got repossessed. I always tell this because it’s not just having the car repossessed, but I had to lie to her and say, “Oh, it was stolen.” Just feeling how miserable and how disgusting I felt having to tell her that… But I did come clean.

It was 500 bucks that I spent on it out of my own pocket, and again, I had nothing to lose.

Joe Fairless: You were back into a corner… And Tony Robbins talks about being either disgusted or inspired, and that leads people to massive action. In this case, you were disgusted. Okay, so you went to the course, and you mentioned some things that the course talked about and that you started doing – holding open houses, calling your sphere of influence… What else have you done? This is probably a good segue into the Facebook ads to grow and scale your business…

Brett Ratkowski: Correct. So that course — Joshua opens up and it’s a step-by-step process of his actual business; he’s taught 1% of realtors in the country and has his own podcast called GSD Mode Podcast that literally just goes step by step in what it takes to actually have a real estate business.

For me, it was not tracking any of my activities. That was one thing I got out of there. I wasn’t doing that, so learning how to track my core KPIs in my business… I didn’t even have a P&L statement. I didn’t even know what I was making and what I was losing. So just having the insight on that, the core KPIs, and how many calls I’m making, how many conversations…

Because the path is in the math. If you don’t know where you’ve come, you’ll never know where you’re going. If you look at the numbers, I was just watching a video of one of my mentors [00:06:42].00] and his video was about Rockefeller and how he knew his numbers inside and out and he always made decisions based off the numbers… Just like in real estate investing – the home has equity after it’s renovated or it doesn’t; is there money to make? It’s either a good deal or a bad deal. So it’s the same thing with the real estate business – it’s either you know where you’re spending your money and it’s giving you an ROI, or it’s not; this activity, if I do it this amount of times, is going to give me this amount of closings and this amount of ROI, or it’s not. I wasn’t doing those things. That was number one.

Then number two – holding open houses. Buyers come to open houses. You’re not holding an open house to sell the home, but now your business comes from there. So doing that… And then Facebook ads. I was already doing Facebook ads, I was still having a little bit of success, but once I saw that he took $10,000 from Zillow and put it straight into Facebook, I was all-in with that. That was what I loved doing, hence why I have a business now that is focused around Facebook ads.

Joe Fairless: And certainly with the Facebook ads it ties into what you were talking about earlier, where you have that direct return on investment or lack thereof, but either way, you’re going to know if it’s an effective dollar that you’re spending on marketing, because is it returning more than what you’re spending?

So what are some ways that we can set ourselves up to be successful when doing Facebook ads?

Brett Ratkowski: So the biggest mistake that I see is a lot of individuals don’t treat Facebook as actual traditional marketing. It is, it’s just online now. It’s not paper, sending out fliers, or putting out signs; it’s marketing. So knowing what your objective is for your campaign – that’s number one. Do you wanna generate leads, do you want to promote your business, do you want to get in front of homeowners that have ugly houses? What is the objective? Then who are you targeting, which is your ad set, which is knowing your customers, having a customer avatar, knowing exactly who you want to target inside of Facebook… Because Facebook will tell you everything; it will tell you who’s interested in Zillow… At one point they told you how much money they made, what their home was worth… Stuff like that. It no longer does that with all the data stuff, but still knowing what people are interested in, what websites they’re going to; do they have kids?

Knowing your customer avatar… And then knowing how to write ad copy. This is the one thing that I see a lot of agents and just individuals on Facebook make the mistake – not knowing how to write the right ad copy. Perfect ad copy starts with a headline that is going to catch their eye, that’s going to hook them. “We buy houses cash.” “Does your home need a complete renovation but you don’t have the money and wanna sell in a sellers’ market now?”

Asking a question is usually what we do, or a bold statement. Then from there you have your filler copy, which is the body, which is what your ad is about, what you’re marketing, what your value proposition to them is… And then your call to action. Call to action is telling them to take action on something: “Click to learn more”, “Schedule a call”, “Get your quote today.” Whatever you’re offering them, tell them what to do. That’s essentially the steps of creating an ad and creating marketing… So hopefully that answers that question for you.

Joe Fairless: Oh yeah, absolutely. The three components that you mentioned – catching their attention with either a question or  a bold statement, then describe what you’ve got (value copy) and then have the call to action.

What about the image, and anything we should make sure we do or don’t do?

Brett Ratkowski: Yes, it depends what you’re promoting. For real estate, for example, if you have a house that you’ve just renovated, and you’re about to put that on the market, whether it’s by yourself or with a realtor, or whatever the case may be, the first thing you wanna do is we always only use a single image, and it’s always just of the outside of the house. The best image of the outside of the house, that way it’s giving that curiosity play. They know a little bit about the home, but it’s not enough for them to know everything, so they are going to click on that add.

Image is huge. One thing you’ve gotta know is Facebook does not allow 20% or more text. A lot of individuals like overlaying it with some text, so just keep in mind that you can’t have more than 20% text on certain ads. But the image – it really all depends what it is. Make it relative to what you’re offering. Video is very, very big right now, and that’s where we’re starting to roll out and put some money  behind video… Because with videos, you can retarget, which is just like going to a website and seeing that — you look for a shoe online and then you see a shoe everywhere. That’s retargeting. You can put ads back in front of individuals that have seen your ads multiple times.

So image – as high-quality of an image, or something that is going to catch their eye, just like your ad copy, and relative to what you’re offering.

Joe Fairless: How do you retarget?

Brett Ratkowski: Inside of Facebook, if you go into Ads Manager where you run all your ads from, there’s an Audiences tab, and when you click on the Audience tab, it has a drop-down and it brings up — you can either do a Custom Audience, a Saved Audience, or a Lookalike. Click on Custom Audience, and then from in there, there’s so many different ways you can create these custom audiences.

You can create a custom audience based off of somebody going to your website – they’ve gone to your website within the last 180 days. You can target somebody that’s watched 25% of your video, you can create a custom audience for anyone that has engaged on your Facebook page…

For example, a lot of real estate investors have a huge e-mail list. Well, guess what? Create a custom audience with that database you have, inside of Facebook. Maybe you have a property you’re trying to wholesale – put that on there and target those individuals that are on your e-mail list.

So there’s a bunch of different ways inside of the Custom Audience. It’s pretty easy, and Facebook walks you step-by-step through whichever one you decide.

Joe Fairless: Going back to what you were talking about earlier, where there’s really a cut & dry focus on the return on investment, what type of metrics do you track for a Facebook ad campaign?

Brett Ratkowski: When it comes down to a Facebook ad campaign, if you’re just looking at it on the ad level, on what you’re promoting now, because obviously your ROI is what’s your cost per acquisition as well… But if you’re looking for just a specific campaign that’s running, we look at obviously cost per lead, if that is the metric that you’re looking at.

Some objectives are cost-per-click, cost-per-engagement, what is that cost per result, and then we’re also looking at what is the relevant score? So the relevant score is how relevant your ad is to the audience you’re targeting. Then we’re looking at the negative and positive feedback; we want the positive feedback to be high, and the negative feedback either be high or medium. Usually, the higher the relevance score and the lower the cost-per-lead. They’re all relative to each other.

Then if you have an ad that’s running for a decent amount of time – a couple weeks, a couple months, however long it’s been running, we’re gonna look at the frequency score, and then cost per thousand impressions. Those are usually the top ones that we look at, but depending on the ad, it’s usually cost per result, relevance score, and that positive and negative feedback are my personal favorites that I look at… Because those are the ones that are directly correlated to the results you’re getting.

Joe Fairless: What are your favorite ones?

Brett Ratkowski: Cost per result, which could be cost per lead, cost per engagement, cost per click… So cost per results. Your relevance score, and your positive and negative feedback. Those are the three that I look at the most. I use those three core to really determine if my ad’s performing well or not.

Joe Fairless: And what’s a good relevance score?

Brett Ratkowski: So a relevance score is 1 to 10. I like my ads to be 7 or higher. Yes, we have some that are 5 or 6; that’s where the rest of the stats will come in. If it’s a low cost per result but it’s just not as relevant, then maybe I’ll look at it But the relevance score is usually 7 to 10. If I’m looking at my KPIs, my core numbers, I want it to be 7 to 10.

Joe Fairless: And what’s a good number for cost per click?

Brett Ratkowski: Cost per click – it depends on the type of ad you’re running. That one’s a little difficult, but you want it to be in the cents. You want it to be under a dollar. It really depends what your potential reach is, how many people you can target in a day and stuff like that, but usually you want that to be under a dollar. Usually, on a very good traffic campaign (that’s what it’s called; that’s where you get that result), you would want it to be anything under 50 cents.

But you can also see what your cost per click is on a video views ad, or a reach ad, which are all different types of campaigns inside of Facebook. But yeah, usually under a dollar if you’re looking at just in general, with Facebook ads.

Joe Fairless: This has been really helpful. Anything else as it relates to Facebook ads that we haven’t talked about, that you think we should?

Brett Ratkowski: What we haven’t talked about… I’Il really touch on what I touched on first – really knowing your objective… What it is you want out of Facebook, and Facebook will tell you what it is. If you want to generate leads for your business, you’re gonna use Lead Generation inside of Facebook. If you want to drive traffic, it’s going to be a traffic campaign. If you want just to put your ad in front of as many people as possible, you’re gonna use a reach campaign.

So just really knowing what it is that you want out of Facebook, that objective, that result, and then the rest falls in place.

Joe Fairless: The lead generation versus traffic campaign – in my mind that’s the same. What’s the difference between lead generation and traffic?

Brett Ratkowski: Facebook is just driving traffic to your website. So if they see your ad, they click the Learn More or View Website button, and it goes to your website. It just takes them off of Facebook.

With a Facebook lead generation campaign, what happens is they click Learn More or click Submit, or whatever the button you select – they click that button, click the image, and a form pops up. When that form pops up, Facebook auto-populates whatever contact information you want to generate, which for me and when we run ads for real estate agents, it’s name, phone number and e-mail. Every single time we generate a lead, it’s name, phone number and e-mail. So Facebook is auto-populating that data from their profile, already auto-populating in that form; all they do is hit Submit, and now you have their information.

We’ve seen that for contact information it’s about 70%-80% correct data when you run that type of lead generation, versus having them go to your website for them to fill out a form.

Joe Fairless: I think you get more people inserting their information on the lead generation form versus the traffic campaign.

Brett Ratkowski: 100%, absolutely.

Joe Fairless: Cool. Very helpful. We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?

Brett Ratkowski: Absolutely.

Joe Fairless: Alright. First, a quick word from our Best Ever partners.

Break: [00:17:45].28] to [00:18:46].04]

Joe Fairless: What’s the best ever book you’ve most recently read?

Brett Ratkowski: Think and Grow Rich.

Joe Fairless: Best ever deal that you’ve worked on?

Brett Ratkowski: It was actually one of my fiancée’s family members – I sold them a million-dollar property and it only took one showing.

Joe Fairless: What’s a mistake you’ve made in business?

Brett Ratkowski: In business… Not knowing my numbers, and just going with emotion on my decision.

Joe Fairless: Best ever way you like to give back?

Brett Ratkowski: I’m in the process of starting a homeless shelter.

Joe Fairless: And how can the Best Ever listeners get in touch with you and learn more about your business on Facebook ads?

Brett Ratkowski: They can go to OptimizedRealEstate.com. If you go on there we have a link where you can click and get a three-part video series that shows you just the basics of Facebook for free. I have a business page, Brett@BrettJRatkowski – if you just type that in, or you just type in “Brett Ratkowski”  you’ll get my business page. We have Real Estate Facebook Marketing For Realtors on Facebook – it’s a free group that you can join… That’s it. Or like I said, you can just e-mail me at Brett@OptimizedRealEstate.com.

Joe Fairless: Brett, thank you so much for being on the show, educating us on what not to do as a real estate agent, and what to do as real estate investors and agents who are looking to use Facebook as a platform for lead generation. I love how you broke it down and got super-specific on the metrics to look at, the ranges for those metrics for what’s good and what’s bad, the high-level strategy and approach we should take… One, know what your objective is, so what does success look like; two, who are you targeting, and three, know how to write the ad copy… And you got into the components of that.

That was a very helpful crash course, and I will include a link to your website in the show notes, so that the Best Ever listeners can go check out your website to learn more. Thanks for being on the show. I hope you have a best ever day, and we’ll talk to you soon.

Brett Ratkowski: Thank you as well.

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Best Ever Show on Relationship Based Lending with Ramon Gonzalez

JF1358: Relationship Based Lending For Long Term Partners with Ramon Gonzalez

Ramon got his start in real estate when he left the corporate world to be an entrepreneur. A large part of his success he can attribute to being able to identify what he is good at and sticking to where he is wanted. After multifamily investing in Miami didn’t work for him, Ramon tried the fix and flip model. Ultimately neither strategy was fulfilling, now he lends money to active investors, and loves it. Hear what he looks for before lending to an investor and why being able to put your ego aside and focus on your strengths is key to being a successful entrepreneur. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!


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Ramon Gonzalez Real Estate Background:

  • Summitt Home Buyers, Chief Investment Officer
  • Places capital with amazing operators that share the same core values
  • 100% relationship based, looking to form and nurture long term relationships with partners
  • Based in Miami, FL
  • Say hi to him at www.miamimillionairemastermind.com  
  • Best Ever Book: Unique Ability by Dan Sullivan

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Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any of that fluffy stuff. With us today, Ramon Gonzalez. How are you doing, Ramon?

Ramon Gonzalez: Awesome, excited to be here.

Joe Fairless: Alright, we’re excited to have you on the show. A little bit about Ramon – he is the chief investment officer at Summitt Home Buyers. He is really 100% relationship-based and looking to continue to form and nurture long-term relationships with partners. The primary focus of his company now is lending their own capital that they made through fix and flips and multifamily transactions to other operators that share the same core values. Based in Miami, Florida… With that being said, Ramon, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?

Ramon Gonzalez: Sure. I have a corporate background, General Electric… Once I graduated, I worked in Connecticut for a little bit; I left the corporate environment, tried doing multifamily with a partner in Connecticut, then moved back down to Miami. I wasn’t able to do the multifamily model [unintelligible [00:02:04].00] didn’t really work for that, and thank god they didn’t.

We did a lot of wholesale and fix and flip in that timeframe, and then we got out of most of the assets in that timeframe. Then throughout that whole cycle we just fix and flipped and made some money like that, and then kind of [unintelligible [00:02:18].28] cycle again; we started picking up assets, we held them, as well as fix and flip throughout the cycle, and we just kind of exited the majority of our assets last year and this year.

Now we’re kind of just in the lending business. We’ve been doing lending, JV, transactional funding with great operators. We find that that’s been our unique ability, our niche. We were good operators, and as I started to mastermind and connect with folks where that really is their passion and unique ability, they’re just better. I focus on what I’m great at – connecting people, adding value, running masterminds, helping these guys really take their businesses to the next level. I’m a lot more happy, and I have a lot more time, and I kind of go where I’m celebrated, not where I’m tolerated.

Joe Fairless: I’ve never heard of it put that way… Did you create that?

Ramon Gonzalez: No, I actually heard that from a part of my mastermind, but I love it; it’s so simple, but it’s really true. It’s really this concept from Dan Sullivan, from the Strategic Coach – he talks about finding your unique ability. I think a lot of entrepreneurs or investors – I think there’s a big difference here: they don’t know what they want, they don’t know what they’re great at, they’re not really self-aware, and then they kind of resign to a life of doing a lot of different things, but not really knowing what you’re passionate about, what you naturally do easily.

[unintelligible [00:03:29].08] from listening to your podcasts, you have a partner on the multifamily business, because you don’t wanna be day-to-day on the operations, right?

Joe Fairless: Well, he’s better at it than I am, that’s what it boils down to. He has better experience than I do, and as you said, I recognize that I am a good operator, but I have a team member and I’d put him up against anyone else… So he takes the charge on that.

Ramon Gonzalez: And it takes putting your ego aside on that, you know? A lot of guys – when you let that ego run the show, it’s no good; it’s “What’s best for the team?”, and if there’s somebody better that can do that, then let’s split capital up with them and figure out how we can do more together.

Joe Fairless: So with your business now, lending your own capital – you’ve evolved that, and I want to focus the majority of our time on that, but I would like to back-track a little bit just to learn a little bit more about your background. You said you were doing multifamily in the North-East, when you were in your corporate background, GE; you left that and you came to Miami, that model wasn’t working, so you did fix and flipping, and it sounded like you were doing fix and flipping during 2008. Is that correct?

Ramon Gonzalez: Correct. 2008, 2009, maybe even 2010. In 2010-2011 we saw the market start to correct, some of the metrics I was tracking in terms of economic cycles… My degree is in economics, and I’ve always had a passion for markets, market cycles, and I could just tell the market was turning; we started buying and holding at that point in the cycle. It’s not that we’re that intelligent; we definitely forced some appreciation, but the market gave us a lot of that appreciation, and having been through my second cycle now, the market has done a lot of the heavy lifting for us, and I’m grateful for it, but at the same time I’m not taking credit for it.

I think there’s a lot of people out there saying “Hey, I’m a genius”, and the reality is the market — rising tides floats all boats, and I’m not taking credit for that. I know that the market did that work. I did some of it, but the market did the heavy lifting, for sure. So we took some profits, and then from those profits we’re now able to scale up the loan business, and through our network as well.

Joe Fairless: You said you were looking at the metrics and you were tracking the metrics; you’ve got a degree in economics, and you were focused on markets in different market cycles. For a Best Ever listener who is now in the fix and flip — or just an active real estate investor, and they want to look at the market cycle through the same lens that you were looking through, what should we be looking at?

Ramon Gonzalez: One of the key metrics I look at, and probably if I had to boil it down to one key metric, it’s probably the supply of inventory. In a normal market is 5,5 months, in a stable market. When the market corrected, that number went way up. What that number means is how long would it take if no new inventory was brought to the market to sell all the existing inventory.

When you have a number like, let’s say 15 or 16, properties are sitting there, no one’s really buying… So what you can do is come in there and buy the best deals; a lot of inventory is on the market. As you see that number come down, you see foreclosures start to come down, a lot of buyers come back on the market – right when that starts to happen, that’s when you wanna start picking up these properties.

I call that “seasons.” You wanna be buying in the spring, because summer is gonna come and then fall is gonna come, and then eventually winter always comes… And again, winter is not a bad part; like, “No, people freeze in winter.” Yeah, but they also go skiing, so you can still make a lot of money in the winter, especially if you’re in a coastal market; you’ve just gotta adjust your strategy.

Joe Fairless: The month’s supply of inventory – how can I find that?

Ramon Gonzalez: All the realtor boards report that. Your local realtor board reports that, all the properties that are traded. When they report new listings, new inventory, you can also look at days on market and how long the current property was sitting on the market; you can track all the data there. The big one is month’s supply. I like to be in a market where if we’re fixing, flipping when there is very little inventory, the little inventory that comes on the market moves very quickly.

Right now, Fort Lauderdale, which is the market above Miami, for single-family houses it has about four month’s supply, whereas Miami has a little closer to six. So if I had a choice between the two counties, I’d rather be in the one where they’re just moving faster…

And then the other thing you wanna look at is at what price points things are moving. Sometimes under 300k-400k  in these markets no one’s building. So you wanna go where there’s a lot of demand and very little supply. [unintelligible [00:07:52].01] the moment you get over 400k-500k, affordability becomes an issue, things sit on the market longer, there’s softening in the pricing, days on market goes up… So you can be strategic in terms of — this is a business, and when you take on investor capital, we don’t take that lightly at all. We’ve never had to file bankruptcy and never not pay someone on time. And it’s not that we’re so great, it’s that we’ve been able to just really be conservative in our numbers; do what you say you’re gonna do, and be strategic.

Joe Fairless: You were a multifamily investor initially, and then you went fix and flip, and…

Ramon Gonzalez: And then we started picking up both singles and multis, and doing both, and fix and flips that generate the income to buy and hold.

Joe Fairless: Okay, perfect. So since you have a background in both single-families and multifamilies, does the month’s supply of inventory metric apply to multifamily purchases the same way it applies to single-family purchases?

Ramon Gonzalez: Not as much. Multifamily is more job growth… It’s a different metric. There’s a website called IRR.com. They provide a lot of great data on multifamily, commercial, where things are in the economic cycle. Even what they call things are different – they call it recovery, expansionary [unintelligible [00:09:06].24] What they track is different on the multifamily and commercial side. IRR tracks all those markets, and it’s what we then use.

In the multifamily space I like to buy for the recovery, and up to late expansion. I think that’s where a lot of the rent increases and everything else, a lot of the value-add is in that space from the market, and then you can refi or do what you want. If you wanna hold it through the down cycle, you definitely can, as long as the properties cash-flow; it’s one of the great things about multifamily. And yet, if your expectation is to have a lot of high appreciation from the market appreciation during a down cycle, I think that [unintelligible [00:09:40].25] during that down cycle, so I think a lot of people are gonna get squeezed if they’re buying at high basis right now, and there’s no value-add.

Joe Fairless: So now let’s talk about your current business. You’re lending capital to operators that share the same core values. I’m repeating what I have in my notes here for your bio… So I’m assuming those are your words, is that right?

Ramon Gonzalez: Yup.

Joe Fairless: Okay, cool. So what are the same core values that you’re looking for?

Ramon Gonzalez: At the high-level are that they’re loyal (loyalty is important  to us), that they think long-term, that they’re relationship-based… So if someone reaches out to me and says “Hey, let’s do a deal together” and they’re like “Alright, what are your rates and what are your points?”, I want them to win, and they also want us to win.

Our loan portfolio right now is gonna be 10 or 15 different borrowers, and we can go deep with a few guys, versus wide with a little bit of guys. Our goal is to help them do more and make more, and ultimately how do we do more together. So they think long-term, they’ve gotta wanna grow… A lot of folks are okay doing a couple deals here, a couple deals there, but that’s not what we want. Most of our guys are doing anywhere from 5 to 10 deals a month, maybe more, depending on the market and depending on what the strategy is… But they can consistently keep a fair amount of capital at play and still keep liquidity high. So high-level that’s what we’re looking for: integrity, thinking long-term, that they invest in themselves and are always growing…

When stuff happens, Joe, in this business, that they tell me about it, that they’re vulnerable and open and say “Hey, you know what? There’s an issue here. This is taking longer than what I thought”, or whatnot.

As long as we have those core values together… And really, the biggest one is that if something went wrong, they’ll do whatever it takes for being resourceful… Take a job at Burger King, whatever it takes to actually pay us back.

Joe Fairless: How do you evaluate for the Burger King example? How do you determine that someone has that characteristic?

Ramon Gonzalez: It’s the hardest part, Joe, because they asked JP Morgan, “Do you look at the deal or do you look at the opportunity? What do you look at?” The answer was “Character, character and character.” I couldn’t agree more. It takes time to know someone’s character, because character is tested when things get tough, that’s when character is tested.

I’m in a lot of high-level masterminds, I’ve spent a lot of time with the operators, and you just start to see how they do things, you start to see how they treat their people, you start to see how they treat a waiter. I run the background checks obviously, and I actually like that they have something – a bankruptcy in the past, or they’ve been through something… I actually prefer that, because I know that they’ve been through it. My thing is not that you’ve been through stuff, but what did you do about it, how did you treat your people…?

So I look at the integrity, I look at how they do things… And really, I like to see how open and vulnerable they are with what’s going on in their business, because all of us being entrepreneurs, there’s challenges we have – hiring people, scaling out the business, emotional challenges… Our holistic being, relationships side. If someone’s looking for help and they realize that there’s an issue and they’re open and vulnerable and coachable, that tells me a lot about somebody.

Joe Fairless: Speaking of challenging stuff – that you and I and everyone else has come across as real estate investors, I’m sure – what’s a challenging moment you’ve had in your business?

Ramon Gonzalez: Oh, wow… I’ve had all sorts of challenging moments. I think the most challenging thing as an entrepreneur… I differentiate an entrepreneur from an investor. An entrepreneur is someone who wants to build out a business, hire people, create staff, processes and systems, and there’s a transactions side of the business. To me, an investor is someone “Hey, you’ve got capital, you put capital at play.” So when we do more of the loan piece, that’s more of the investor piece, even though we are actively growing that business… Yet, it is “Hey, we’re putting capital at play for a return” – that’s more of an investor.

When we were doing a lot of the fix and flip transactions, and in that space – we did some JV deals in that space – the hardest part I think about being a business owner is bringing someone on board, training them, making sure that their core values are aligned with the company’s, and then really helping them grow. Some of the worst parts is letting someone go. I care so much about my team and bringing people on staff that if something doesn’t work — you do everything you can; [unintelligible [00:13:30].00] when we hire people and everything else, but sometimes it just doesn’t work out. Sometimes you go to three or four people, five people, and it can definitely be frustrating and a little bit discouraging at the same time.

I’ve had employees come on staff starting at $30,000 become multi-millionaires through our organization. Outside of my daughter and my wife, maybe even the masterminds, it’s the single biggest thing that I’m most grateful and proud of, when someone in the organization becomes a multi-millionaire. Sure they did the work, but you were there as a coach to help them, inspire them, influence them… And that’s what you can do as a coach. You can’t do the work for them, but it sure is gratifying.

Joe Fairless: If you can think about one of those individuals who came into the organization making 30k and then becoming a multimillionaire, what transactions did they do to get them to be a multi-millionaire?

Ramon Gonzalez: They were always very up-front on saying “Hey, whatever you guys are doing, I want to start doing some of this as well. If you can teach me, I’m here to learn, and I’ll take less of a salary, but I wanna learn everything you guys are doing”, and they were willing to pick up tasks on the weekends, or willing to pick up extra work. So they didn’t limit themselves to that role, and we were almost like a partner; whatever was needed from them, they were willing to do.

And then also it’s the organization – me as a leader, if I came across a deal, and rather than sell it to the market, and even though we were gonna make a substantial profit, this person in our organization [unintelligible [00:14:50].11] and she said “Look, I’ll buy this deal at this number.” And again, she saw what was happening with the market, she picked up a few condos, and as the market increased in value, she started refinancing, recapitalizing, and continue to save. And again, deferred gratification, and just followed the footprints we were doing. She followed all our property management  systems, how to find properties, how to do direct mail… She figured all those pieces out on her own, and she was very intentional and said “Look, I’m not gonna compete with you. I’ll do this [unintelligible [00:15:17].17] I’ll do this through the MLS”, and I was totally on board.

I knew she was gonna become wealthy by working for us, and I’m so proud of her. She is family. I only had one employee do that. She isn’t my family, but she is family, you know what I mean?

Joe Fairless: Yeah, I hear it, and I’m sure she’d say the same thing about you, that’s for sure. So basically it was the method of buying condos, them appreciating in value, refinancing out the proceeds and using those proceeds to put into new deals?

Ramon Gonzalez: That’s it.

Joe Fairless: Great stuff.

Ramon Gonzalez: Yeah, just being persistent, just continuing to persevere and not bang our head against the wall… And there’s people out there like that, you can change their lives. So as an entrepreneur, outside of the profits and everything else – the money is temporary; that’s single biggest impact that you could do as an entrepreneur – the lives of the people you touch.

Joe Fairless: Based on your experience as a real estate investor and entrepreneur, what is your best real estate investing advice ever?

Ramon Gonzalez: When you look at a deal or you look at an opportunity, identify if it’s an opportunity or distraction based on your unique ability. What is it that you’re uniquely great at? What is it that you’re here to do? There’s 1,000 doors to financial freedom; what is your thing that you have a unique gift at? Follow that course to your financial freedom path. It’s gonna be different for you. Don’t copy anybody else; listen to them, take advice, but find your unique way, find out what you’re great at, and then double and triple down on that. That’s gonna be your unique way to financial freedom.

Joe Fairless: Powerful, powerful. I’m gonna repeat what you said, the Best Ever advice, and then I’ll recap it later, because it definitely needs to be mentioned again. Identify if it is an opportunity or a distraction based on your unique ability. I always talk about identifying the unique ability that we have and leveraging that, but I never thought about assessing it based on new opportunities and seeing if it’s a distraction or if I can leverage what I’m doing. That’s great stuff.

Ramon Gonzalez: Awesome, I’m happy to add value to your listeners. I think what you’re doing is amazing, and it’s definitely needed, man. I think you’re creating a huge impact, and I’m really proud of you, man.

Joe Fairless: I appreciate that. We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?

Ramon Gonzalez: I am, I’m ready!

Joe Fairless: Alright, let’s do it. First, a quick word from our Best Ever partners.

Break: [00:17:29].19] to [00:18:09].13]

Joe Fairless: Okay, best ever book you’ve read?

Ramon Gonzalez: Best ever book I’ve read… I’m gonna go with A Unique Ability by Dan Sullivan.

Joe Fairless: Oh, man… Okay. I did not know that was an actual book. I will check that out. Best ever deal you’ve done, that wasn’t your first and wasn’t your last?

Ramon Gonzalez: Best ever deal I’ve done was an 18-unit deal we purchased in Miami, Little Havana, upcoming neighborhood. We thought we were buying it high; we came in there, redid the whole thing and sold it, and netted about a million dollar on it.

Joe Fairless: Why did you buy it if you thought you were buying it high?

Ramon Gonzalez: I didn’t really know the market and I didn’t really know the pocket that it was at, and how good the pocket was. It wasn’t until later a Marcus & Millichap broker – him and I are great friends – told me “You don’t understand how good of a quality location this is”, and what was going on in the area. I thought it was a good deal, but yet the area and everything else, really… I was able to get higher rents, I was able to get better quality people just because the exact corner it was at.

It was still in a hot spot, it was still in a touristy area; I didn’t know that, but I was right at the fringe of that. Had I been on the other side of the street – a completely different property. This just goes to say, know the areas, because that building generated an extra couple hundred dollars in rent a month, and it filled up a lot faster just because where I was at, I could justify the rent increase and I could just find the extra value in the improvements, and someone was gonna pay for that, whereas on the other side of the street they wouldn’t.

Joe Fairless: What’s a mistake you’ve made on a transaction that we haven’t talked about already?

Ramon Gonzalez: A mistake I’ve made – we purchased an 84-unit building in Baton Rouge; it was in a D area, it was a half property contract, the whole building had like a Section 8 subsidy and we weren’t equipped to handle that kind of asset. We didn’t have the infrastructure, we didn’t have the know-how, and we got our butts handed to us.

Joe Fairless: How much did you lose?

Ramon Gonzalez: I wrote off $364,000 last year.

Joe Fairless: That was last year, so I imagine it was more than that?

Ramon Gonzalez: We wrote off the whole thing. We had bought this in ’07, so at the peak of the market (or ’06), and just recently I just wrote off the rest of it. Luckily, we had a lot of gains from the other things, so we were able to kind of tax harvest that, but it still sucks.

Joe Fairless: If presented a similar opportunity now, what would you look at differently that you didn’t look at before?

Ramon Gonzalez: Just knowing that unique ability, and sticking to that. It wasn’t a unique ability; I don’t do a lot of Section 8 stuff. I was missing an operator at that Section 8 stuff, that that’s all they do. So I have an operator now who I’ve just found today actually, and they do a lot of turnkey Section 8 stuff, but that is all they do. They don’t do anything but that. They do C-, D stuff. They have a real turnkey model, they have scale, and then I’ll do that through them, but that wasn’t a unique ability for us. Really staying in a lane…

Joe Fairless: What’s the best ever way you like to give back?

Ramon Gonzalez: The best thing I’m gonna do when I give back is my mastermind. I run masterminds, I have high-level investors coming in, different spaces of real estate, whether it’s mobile home parks, self-storage, whatever it is, or fix and flip business entrepreneurs… And I look to just really connect people together, connect amazing together that share core values, and “How do we do more together?” That’s the best thing I do to give back – the power of masterminds and getting together with like-minded people and just collaborating.

Joe Fairless: How can the Best Ever listeners get in touch with you?

Ramon Gonzalez: You can go to miamimillionairemastermind.com, that’s my website. You can find out more info there if you’re interested in masterminding. I’m on Facebook, I do a weekly Facebook live within real estate and I help people become financially free. [unintelligible [00:21:31].25] is to help a hundred million people become financially free.

Joe Fairless: How many people?

Ramon Gonzalez: A hundred million.

Joe Fairless: That’s what I thought I heard you say. Yes, do that! Please do that, I’m kind of speechless; do that, please. That’d be incredible.

Thank you so much, Ramon, for being on the show. It’s a sprinkle of real estate and a dash of mindset, and I think that’s the approach to take in our business, because mindset is critical to what we do… But we also talk specifics about deals, and lessons learned, and as I mentioned earlier, I’m a huge fan of what you said – identify if something is an opportunity or a distraction based on our unique ability. And it sounds like a good book to read on that is Unique Ability, by Dan Sullivan.

Thank you for talking about your thought process as someone who studied economics. Month’s supply of inventory for single-families, and then for multifamilies it’s more job growth, and you gave a reference or a resource, IRR.com. Great website. They have a (I believe it’s) annual report that’s really good.

Ramon Gonzalez: It’s amazing.

Joe Fairless: Yeah, it is amazing. Thanks so much for being on the show. I’m really grateful you were on the show. I hope you have a best ever day, and we’ll talk to you soon.

Ramon Gonzalez: Thank you, Joe. I appreciate it.

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JF1283: Sell Faster & For More Money By Hiring An Interior Designer with Steven Gurowitz

Adding value can happen in many ways. Steven found a niche for himself in the 1980’s and has been designing high end interiors ever since then. Not only will he design a brand new interior, Steven goes above and beyond by furnishing with fine Italian furniture, and many other small details that a lot of companies overlook. Hear why this is valuable for the investors that hire him. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!


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Steven Gurowitz Background:

Started his own design firm, Interiors by Steven G in the early 1980s

-He has turned the company into the one of the country’s largest high end interior design companies in Miami

-Has created interior design projects for commercial, residential and hotels

-Has two showrooms in South Florida with more than 80 employees and clients all over the world.

-Say hi to him at http://www.interiorsbysteveng.com/

-Based in Miami, Florida

-Best Ever Book: The Art of the War


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Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless. With us today, we’ve got Steven Gurowitz. How are you doing, Steven?

Steven Gurowitz: I’m doing well, Joe. How about yourself?

Joe Fairless: I’m doing well, and nice to have you on the show. You’ve got an interesting background. Steven has started his own design firm, which is Interiors by Steven G., in the early 1980’s. He started out as a real estate investor. He’s based in Miami, Florida.

I’m gonna go ahead and just turn it over to Steven. Steven, do you wanna tell us a little bit about your background and your current focus, just how you got started?

Steven Gurowitz: Got it. Well, Joe, 44 years ago I started working for a very small boutique interior design firm here in South Florida, and I took a love and liking to the industry and I really became very self-educated. As the years went on, I was with the firm and became a junior partner, and then almost ten years into it I said “There’s a better mousetrap, there’s a better way to do this, and I’m too talented a person to sit here.”

35 years ago I left the firm, started Interiors by Steven G. out of the den of my home. All of a sudden, my business started to grow and the next thing I knew, I owned my first showroom that was 10,000 square feet. Developers started to call me to do model apartments, model homes and common areas of buildings, so I saw a great opportunity to integrate the world of design into investing and real estate… So I personally started to invest in pre-construction. But what I did was as I closed on the real estate, I would furnish it above the norm, to bring a wow factor to the real estate, put it back on the market for sale, and let’s say 10%, 15%, 25% of the entire project was up for resale from investors. My units would sell first because of the wow factor, and I sold them at a larger price than anybody was getting.

As that started to transpire, my business started to grow. Today we’re at 100,000 square feet of space, and we do this all over the United States for developers and private owners. Basically, I went out to the broker community. In Florida, as everywhere in the country, when there was a boom there were always tremendous investors from out of the country, from local… And I said to the real estate agents, “I will furnish and decorate your owners’ condominium apartment and give them (or you) one year to sell it and pay me. If it doesn’t sell in one year and one day, I get compensated.” We have done this to the tune of 1,000 units, and at the end of the day, nothing has stayed on the market more than six months.

We just opened up a project called [unintelligible [00:05:01].02] a very high-end, luxury project in Williams Island, Florida where we installed four model apartments. The first model sold furnished in one week. So it started to grow, and as long as the owner owns the real estate free and clear and it’s not mortgaged and I can be protected, I’m in the deal… As long as it needs something that’s more on the high end.

Now, we opened up another showroom four years ago next door to us called Now by Steven G., which became popular-priced design packages, as we call them, that run from $35,000 to $125,000, that we’re doing for investors that are renting and getting a bigger dollar, or flipping and getting a bigger dollar in popular-priced real estate. But the place that this really works the best is what I call the luxury market, which is really two million and up.

The developers, the real estate people are selling them like hot cakes, as I am for myself personally. Every project that I do for a developer, I’m hired years before it’s a reality. So I buy at a favorable price, I wait it out, I give it the deposit, I furnish immediately after I close, it goes on the market within a week, and boom. It has just been a huge part of our business where I had to hire a team of designers to work under me, that only do that. That’s how much work we have from our regular business and what I call the investing in real estate business.

Joe Fairless: So at the core of what we’re talking about is – let me know if I’m summarizing this correctly – you identify an opportunity to enhance the interior of a condo, of an apartment, and by doing that it’s then more appealing and then it moves off the market, and then you’re compensated for adding that value through that process, and you do that as a third-party to help out. And you help out brokers who have a deal that hasn’t been moving, and you also do that with your own investing, with pre-construction deals.

Steven Gurowitz: I’ve gotta tell you the only word for it, Joe, is unbelievable. I have clients that hire us to do their own residential work, and they ask me if they can invest with me in my process. Thank god we’re that free firm, I don’t need anybody’s capital, and the end of the day we all know investing money today is always a touchy thing, whether it be the market (even though the market has soared), real estate especially in Florida.

When the market crashed in ’08, it was January of ’08. By June, prices went right back to where they were and higher. So it’s an amazing marketplace, Florida, because it’s a melting pot of people from all over the world, and everybody’s running especially with their money out of a lot of strange countries, because they’re worried about their future there. People that have lived their entire lives there are coming here and buying three, four, five different investment pieces of real estate, so we have found it to be a huge part of our business. Huge.

Joe Fairless: And doing it in Miami is the perfect market to do it, and clearly with your accent you’re not from Miami, are you? You’re from New York?

Steven Gurowitz: Born and raised in Forest Hill, Queens, [unintelligible [00:08:28].20]

Joe Fairless: I knew it! [laughs] I lived in New York City for ten years and it was pretty clear to me that you’re a New Yorker. Okay, so you are doing it in a market (Miami) that caters to more high-end real estate than, say, Cincinnati, or Dayton, Ohio or something like that. So you’ve got a business model that fits within a market… What is your team doing to these units – just pick maybe any of the examples that you’ve mentioned – to enhance the appeal to a potential buyer?

Steven Gurowitz: Okay, well 90% of that luxury high-end real estate in South Florida, the developers have a very fancy word called “decorator-ready.” That means it’s empty. There’s no floors, the walls have a primer code of paint, and bathroom and kitchens are installed. Other than that, you have to go in and design and furnish the entire unit; you have to put flooring in, window treatments. But what we do that’s very different is we go in and furnish it first-class with Italian furniture, with beautiful Italian porcelain floors. We drop ceilings and do LED lightning, so when people walk in, they’re blown away. They don’t expect it, number one, and when people – especially the lady of the house, which if a family is buying, we all know [unintelligible [00:09:49].11] and if the housewife doesn’t like it, the husband can’t buy it.

So the lady of the house walks in, falls in love, and the best part about it for a buyer is today if you buy a brand new condominium and it’s raw, you have to do the design work, you have to pull the permits, and the downtime between permitting and ordering is 6-8 months. Now if you buy and it’s empty, you’re paying your maintenance, your taxes, your electric bill for 6-8 months and you can’t even stay in the unit. And everybody in the high-end world has lived through a designing of an apartment or a home in their past.

The husbands are not fools, they know what their wives will spend. If they walk in the door and they get a number and it’s finished and the wife likes it, that’s 90% of the battle. The rest of the battle for the husband is not allowing the wife to go over a budget, which is also famous in my industry. So there’s a fixed number, you move in the next day if that’s what you wanna do, and you’re done. So there’s a big savings between the taxes, the maintenance, insurance and electric, and the use of the unit immediately is what we call instant gratification, and it definitely works.

Joe Fairless: When you approach brokers – or when brokers approach you – to help them move a property that hasn’t moved yet, or sell a property that hasn’t sold, to be more specific, you told us earlier that it has to be free and clear so that you’re not having to wait in line in case it never sells. What percentage of leads have a broker representing an owner who owns it free and clear?

Steven Gurowitz: 90%.

Joe Fairless: Welcome to Miami. [laughs]

Steven Gurowitz: Well, you’ve gotta remember, after the crash, Joe — before the crash you were a buyer, you could put 20% down and go for a mortgage, okay? So what happened in the crash – thousands of 20% buyers walked away. “Keep my 20%, I’m not closing the buy.” So who got hurt? The developers took a bloodbath. After that, the developers changed the modus operandi. By the time you close today on a luxury condominium in South Florida at any price, you have put up between 50% and 60% and in some cases more of the money and you’re not walking away. So now guys that might have bought three or four years ago when the market was red hot, now the market’s cooled down a bit – you know, it’s that cycle that South Florida goes through – and a building could close with 160 brand new apartments, nobody’s walking away because they have too much money at risk. Now 40 units can be up for sale the next week in a building with 160 units; there were 40-50 investors, or in some cases they could be half the project.

So now the realtors are looking for an edge as to how to get their client out. So if you had 5-6 million on the table, hard, cold cash, and the realtor said “Listen, I’ve got the best designer in town. His track record for selling empty real estate decorating it is unsurpassed. He’s gonna decorate the unit. We have a year to sell it, or pay whatever comes first”, the clients bite at the chance, because there’s no outlay of money. I outlay all the dollars, no matter how much it is.

I have a deal cooking in a project right now where an owner owns a penthouse and it’s a two and a half million dollar buildout, and I’m just waiting — he has approved, his realtors are ecstatic, I’m just waiting for the lawyers to sort of dot the i’s and cross the t’s… And I know – because I know the project like the back of my hand; I did 53 units for owners of the project – when this is decorated, this will sell for between 18 and 20 million dollars furnished.

Joe Fairless: How do you know what in this case — I mean, you said you have a high level of experience with this property… But for a property that is a one-off, how do you know how much to spend and where to spend it so that you do get the ROI back?

Steven Gurowitz: Okay, so rule of thumb in the high-end design world – 50%-65% of luxury condo buyers spend between 20% and 30% of the cost of the real estate to do the buildout, flooring, TV’s, sounds systems, finished. The average. Then there are people that spend 40%-50% because they just have the dollars, they want it over the top etc. So if I’ve got a five million dollar piece of real estate, it’s 1 to 1,25 million for the complete buildout, which is roughly 20%-25% of the cost of the real estate, and it makes it appetizing for anybody in that price point. And remember, and the richer and the higher the price, Joe, the more the luxury real estate will sell, because they don’t wanna go through the root canal and the downtime of six months, eight months, or whatever it could be. Instant gratification is an amazing word that just continues to fly by.

And keep in mind, in the last 44 years I do about 2-3 a year for myself, as a separate business. And believe me when I tell you, the only time I’m gonna say I had a lull was the first six months of ’08. After that, everything sold; it was just like it never happened, and there was an amazing bounce back. Everybody was jumping out of windows in January, and all of a sudden in South Florida, came May-June, it was like it never happened, and developers started raising prices all over town.

Joe Fairless: With it already being done for the buyer, it’s also a benefit that they can finance it, but do they finance these properties, or do they just pay in cash?

Steven Gurowitz: I’m gonna say 80% of our market here in South Florida is a cash buyer.

Joe Fairless: Okay.

Steven Gurowitz: But I will tell you, Joe, there’s a lot of out of country or off-shore buyers that would like  a mortgage; they can’t get one from a conventional bank because they’re from Venezuela, or Argentina, or Brazil. There’s guys making a zillion dollars here in the hard money lending business, and they’re giving mortgages like [unintelligible [00:16:46].06] at 10%-11%.

Joe Fairless: Based on your experience as an entrepreneur/real estate investor, what is your best advice ever for other real estate investors?

Steven Gurowitz: I believe that the greatest time to buy luxury condominiums – because that is really the biggest part of the real estate world in South Florida – is to only purchase free construction. And I am a believer [unintelligible [00:17:16].12] pre-construction, because every developer wants to get to a certain pre-sale market, they’re flexible on price. And you can sit there and you can – let’s use the word ‘negotiate’ a better number. When you go into a project and you buy when it’s finished, you’re paying top dollar, and if you’re an investor, you’re not getting out and making money. You’ll get out, but the windfall is not gonna be there for an investor, Joe.

Joe Fairless: It’s such a smart business model, one because you’re in a luxury niche, and two, you’re solving problems for real estate brokers, for developers, and then also for the buyers, and you’re making money along the way and really giving them an offer they can’t refuse. Do you think this could be replicated if you lived in Boise, Idaho, or Houston, Texas, or Corpus Christi or somewhere like that?

Steven Gurowitz: I think it could be replicated anywhere in the United States, as long as you have as a designer the knowledge of the value of the real estate that you’re buying, versus the investment to flip. Certainly, Joe, if you’re buying a $250,000 condominium that’s a two-bedroom, you have to be cautious to what you spend on the fix-up, but I believe it’s a business model that could work anywhere. It’s all about the dollar investment and the wow factor.

We did a project in Miami, Joe – a guy builds a condominium building in downtown Miami. no parking. Think about what I just said – no parking. If you have a car, you’ve gotta find a lot to leave your car, or a meter on the streets, or figure that out.

Joe Fairless: That’s a problem for a luxury [unintelligible [00:19:01].04]

Steven Gurowitz: Yeah. And I’m gonna say luxury, but popular-priced. 450k, 550k, 650k. Those were the price points. So he came to me and he said “I want you to do 25 units.” We furnished 25 units for $18,000 a pop. He sold them overnight, because people walked in, even in that price point, and loved the fact that they could close and move right in. So I believe it’s all relevant to — I’ve got a monster project that people are talking to me now in New Orleans… Because our trucks go all over the country. So they came to me with a project, and I said to them, I said “Guys, I think you’re taking the wrong approach at this price point. And they looked at me and I said “Look, I’m doing this 44 years. I think I’m pretty glib. I say you should sell every one of these units furnished, and give the buyer five different looks to choose from, all in the same price point.”

Two days later I get a phone call, “We love your concept, let’s roll.” So again, I’m just waiting for contracts to be signed. Who takes the approach, try to do something different is the way I’ve always focused, not only for my real estate investing, but in my design business, which allows everything to happen. We’re doing between 100-125 residential design projects a year. Huge numbers. My staff is 82 at this point. We’re running six trucks. We just came back from the Hamptons in New York, we just finished a job in Kioa Island… People want the talent of the firm, and that leads to everything else. When you have a happy client, just like if you have a good real estate deal – everybody’s happy, and the broker does a great job. If you’re gonna do more real estate, you’re with that broker a second time, or third time.

We have people here that are doing the fifth, sixth, seventh job in 35 years with us.

Joe Fairless: Well, it sounds like it’s a no-brainer ROI on those deals. We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?

Steven Gurowitz: I’ll do the best I can, Joe.

Joe Fairless: Alright, deal. First, a quick word from our Best Ever partners.

Break: [00:21:21].24] to [00:22:10].05]

Joe Fairless: What’s the best ever book you’ve read?

Steven Gurowitz: The Art of War.

Joe Fairless: Oh yeah, good one.

Steven Gurowitz: By Sun Tzu. I couldn’t read it all at one time, Joe, because it was so complicated, but when I got through it, I actually read it a second and a third time, because I found things in that book that lent itself towards a business model, not only going to war. So I loved the book.

Joe Fairless: Another book I know you’d really like is by Robert Green, The 33 Laws of War. What is a mistake you made on a transaction?

Steven Gurowitz: Believing verbiage out of a developer’s mouth, rather than having it in black and white?

Joe Fairless: What happened?

Steven Gurowitz: 90% of what was promised was not delivered, and it was a big disappointment and I was lucky to get out with my pants, if you know what I’m saying. I closed [unintelligible [00:23:02].08] and all of the lifestyle never really happened, because there was a disclaimer kind of a thing in the contract, and I trusted. That was years ago, and I’ve learned from that if somebody makes a commitment or a promise, they shouldn’t be afraid to put it down in writing, as I do for my clients.

Joe Fairless: Best ever way you like to give back?

Steven Gurowitz: Joe, that is a very touchy subject for me, because without the hoopla, without my name having to be on a building, both personally and corporately, we are very philanthropic here… Whether it be to the [unintelligible [00:23:42].21] Foundation, whether it be to children’s autism… Last week the local newspaper (Miami Herald) put out a wishbook for Christmas; we donated a custom wheelchair for $8,800 for a young boy struggling with his parents. We have done huge hurricane relief, we have run our tractor trailers to [unintelligible [00:24:04].12]  to New Orleans when they were hit; we ran tractor trailers to Baton Rouge, Louisiana, we ran to New York and New Jersey, not once, twice. We teamed up with Channel 10, they went out on the air, we filled up 53-foot tractor trailers, had the Florida Highway Patrol escort us so our trucks didn’t have to stop at weigh stations, so we would get to the North-East in 22 hours. That is what I call karma, to be able to give back when you’re blessed, and we’ve been very blessed and fortunate here in Florida.

Joe Fairless: How can the Best Ever listeners learn more about your company?

Steven Gurowitz: They could feel free to call. I love to talk to people. I’m probably the most reachable designer in the industry. They could call my cell phone at 954-592-3332 or text me, seven days and seven nights. The phone is never off.

Joe Fairless: Well, Steven, thank you for being on the show. It’s a beautiful business model (pun intended) and it’s an approach where you’re dealing with the luxury market and you’re solving problems for real estate brokers, because it helps them sell a property faster for owners who have a property that hasn’t sold, because that helps them get the sale done faster… For developers and then for luxury buyers, because it’s a turnkey operation and they don’t have to worry about hiring contractors after they move in. Then for all the poor luxury buyers, they can finance those costs versus having to pay out of pocket.

Steven Gurowitz: Joe, [unintelligible [00:25:42].04] thanks you. I’m honored to be on this show.

Joe Fairless: Thanks for being on the show, my friend. I hope you have a best ever day, and we’ll talk to you soon.

Steven Gurowitz: You too.

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JF1037: Beginner Wholesaler Does 80 Deals in his First Year!!!

Have you made the jump into real estate investing yet?  If not, wholesaling is a great way to get started, even if you have some experience, I’m sure you can still learn from Raul.  At only 23 years old, he is doing more deals than a lot of people twice his age.

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Raul Bolufe Real Estate Background: ‎
-President at Capital Rise Investments LLC
-Have done over 200 deals since beginning wholesaling in 2014
-By age 23 he has wholesale over $15M and made $355K off of the MLS
-Now has a team of 7 people and 3 agents working with the company and growing
-Based in Miami, Florida
-Say hi to him at capitalriseinvestments.com
-Best Ever Book: 10x Rule by Grant Cardone

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Raul Bolufe wholesaling advice


Joe Fairless: Best Ever listeners, welcome to the best real estate investing advice ever show. I’m Joe Fairless and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any fluff. With us today, Raul Balufe. How are you doing, Raul?

Raul Balufe: What’s up, man? Thanks for having me, Joe.

Joe Fairless: Nice to have you on the show, my friend. A little bit more about Raul – he is the president at Capital Rise Investments. He has done over 200 deals since the beginning wholesaling in 2014. By the age of 23 he has flipped over 15 million dollars of property and made 365k off of the MLS – we will get into that. He is based in sunny Miami, Florida. With that being said, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?

Raul Balufe: I started investing a couple years ago, about three years back. It was a scary transition, because especially in this market it’s really competitive, but I figured “Hey, if other people can do it, I think I can do it, too.” I was actually selling cars at my dad’s dealership, and then I saved enough money and I bought my first rental property and I figured “Hey, I could do this again.” So I started listening to podcasts, reading books, and I got into it.

I got a mentor down here, and I started with the MLS, learning how to send offers, learning how to find buyers, and that’s pretty much how I got my first deal. Now I’m just running with it… We still do MLS, but now we’re doing a lot of mail, we’re doing some bandit signs, we’re doing some internet marketing, websites, and we’ve kind of grown to a team of about eight men, and doing some deals.

Joe Fairless: You’ve got an eight-men team… Walk us through who does what.

Raul Balufe: I’ve got an assistant secretary – she pretty much answers the day-to-day calls and does the checks and pretty much the organization. I have an acquisitions manager for MLS, then I have a sales manager that pretty much does all the sales, I have two acquisitions members, I have one sales guy, and then I have an office manager and two VAs. I don’t know if I lost you there, but…

Joe Fairless: No, you didn’t… [laughs] I’ve been taking notes. Who did you hire first?

Raul Balufe: My first hire was actually one of my first VAs.

Joe Fairless: And how did you find your VA?

Raul Balufe: Online, through Upwork.com. I think before it was oDesk, or something.

Joe Fairless: Yeah… What did you have the VA do?

Raul Balufe: I had the VA send offers for me. I kind of showed him how to fill up the contracts using freedom soft, and I had the VA tell him what [unintelligible [00:04:54].02] and then I would send him the information that would do it.

Joe Fairless: What type of training process did you do at the VA?

Raul Balufe: I actually got some of the training process from another podcaster, Joe McCall… He has some training thing for that, of what to have VAs do. I used the backbone of that, and then I kind of just implemented my own little strategy with them. But usually through e-mail or through YouTube video – I’ll make a little video of how to do it, and they would do it.

Joe Fairless: And how much do you pay them an hour?

Raul Balufe: One VA – I have him at $3.33 and the other one at $4.50.

Joe Fairless: For someone who has a wholesaling business and wants to make that first VA hire, what would you recommend to them? Either a lesson you’ve learned, or ways to get out of the gate strong.

Raul Balufe: What I would recommend is make sure that you yourself know how to do the task very well first, before you can get someone to do it… Because since it’s not in person, you can’t really show them, so it might take a lot of explaining and videos and training to really get them to do it. So make sure you really know how to do it perfectly before you get someone to do it.

Joe Fairless: So before we try and automate our process, we actually have to know the process – is that what you’re saying?

Raul Balufe: Yeah, man… It makes it a lot easier. It’s just so much easier to be able to train somebody on something that you know how to do in and out, so they can sense that you know how to do it.

Joe Fairless: 15 million dollars worth of properties that you’ve wholesaled, right? Not fix and flipped, but wholesaled?

Raul Balufe: Wholesaled, correct.

Joe Fairless: Okay. And how old are you now?

Raul Balufe: 24.

Joe Fairless: And when did you get started? In 2014?

Raul Balufe: Yeah, correct.

Joe Fairless: So 2014, this is 2017 – so in 2016 you were 23 and in 2014 you were 21. So you started when you were 21 years old, and in two years you had wholesaled over 15 million dollars worth of property, right?

Raul Balufe: Yeah… I’m right around 26 million now.

Joe Fairless: What was the first property you wholesaled?

Raul Balufe: The first one I did was actually — I was doing a technique that I learned from Joe McCall, actually… Pretty much texting landlords on GoSection8.com, asking them if they wanted to sell their house. I got a hold of a property manager, and the property manager introduced me to the landlord. That’s pretty much how I got the first deal. I said, “Hey, are you looking to sell?” He said “Oh, I’m not, but my landlord is. I manage his properties.” He put me in contact with him and he gave me a lot of information about his properties; I made him an offer, and I actually got two under contract. That’s how I got my first deal.

Joe Fairless: Where are these properties located?

Raul Balufe: South Florida.

Joe Fairless: Can you give us the numbers on that first one?

Raul Balufe: I was getting it for 62k and I assigned it for 68k. So I made about 6k there.

Joe Fairless: And you mentioned GoSection8.com – obviously, it’s a website. I haven’t heard of that one.

Raul Balufe: That’s pretty much a website where landlords and potential tenants can go and view properties that are Section 8-ready… Pretty much properties that the landlords only want to rent to Section 8 tenants.

So the tenants can create an account as if they’re the tenant, and they’re able to view these properties. The landlords create an account like if they’re landlords, and they can list their properties there. And it’s free.

Joe Fairless: Okay. And you went online and you texted the number, you got a hold of a property manager who then introduced you to their client, the landlord, and then you wholesaled his property.

Raul Balufe: Correct.

Joe Fairless: $62,000, and you signed it for $68,000… You gotta do a lot of those to make up 15 million in two years. Help fill in some of the gaps there.

Raul Balufe: When I say 15 million it’s worth of properties, not 15 million profit.

Joe Fairless: No, I get it. I was with you on that. [laughs]

Raul Balufe: Yeah, okay… I’m like “Damn [unintelligible [00:08:55].22] I’d be next to Donald Trump, or something.” So basically our average property now is about 120k. Basically, we do about 80 deals a year.

Joe Fairless: Okay, I’m with you.

Raul Balufe: Do you kind of see how I got there? So the 60k one is one on the lower end.

Joe Fairless: That was your first property.

Raul Balufe: Yeah, it was my first one. So now our average wholesale is from 140k, 160k, something like that.

Joe Fairless: What are you doing with the profits? Are you investing them into long-term holds, or are you just putting them all back in the business, or are you buying cars, or what?

Raul Balufe: No, not cars, man… [laughter] Maybe a little bit. So a big portion of it in the beginning (in my first two years) was going into buying rental properties. I accumulated a little portfolio of single-family homes – I’ve got about ten of them now. After I did that, I started putting more of the profits back into the business: hiring new people, sending more marketing… That’s when I got more into mail and online advertising, and hiring more staff to help me grow.

So to answer your question – yes, in the beginning more towards buying properties for rental income, and then now the majority going back into the business.

Joe Fairless: What’s been the best investment that you’ve made back into the business and what’s been the worst investment that you made back into the business?

Raul Balufe: That’s an awesome question. [laughs] I like that question. Okay, so the best investment made back into the business was reinvesting in mail marketing. I’m sure you hear – and probably everybody listening to this probably hears a lot of podcasts or reads books, and they hear that mail goes up, it goes down, but if you’re consistent, mail works. At the end of the day it’s just the way I’ve seen it.

I might have a month that I get a 2% return, I might have a month that I get a 6% return. It just all depends, but being consistent with the mail has helped me out a lot. And apart from getting deals through it, it builds a lot of credibility, because you’re getting off-market stuff, and buyers love that.

When I get an off-market deal and I’ve got them through mail, it really builds a lot of hype towards the properties that we’re getting, and it shows that we’re active out there. We’re not only getting deals that are on-market, but we’re also really hunting for those deals that are off-market.

Joe Fairless: No one else has mentioned the “building the credibility because you’re getting off-market deals”, and I’m glad that you did, because I never thought of that.

Raul Balufe: I saw that happening, because I’d be like “Man, this house’s price is the same as the ones that are on the MLS, but we’re getting three times the amount of calls.” So as I start talking to these people, they’re like “Yeah, but I haven’t seen this deal before. How many more of these do you get?” I’m like “I’m actually getting them more frequently now because I’m doing a lot more marketing.” They’re like, “Okay, make sure you put me in your VIP list. Make sure you get me on there.” I’m like, “Alright man, will do.” I started noticing that… And it gets more buyers, and you can then turn those buyers into people who buy other properties.

Joe Fairless: I like that. And what about the worst investment you’ve made back into your business?

Raul Balufe: The worst investment that I made back into my business… Great question. Well, I would have to say it was maybe spending it on systems that I didn’t need. I don’t wanna name any names, because I’m not out here to bash anything, but mainly just systems that you don’t need. Try to simplify your business.

Obviously, you need a CRM, or you need certain sheets or computers or software or whatever, but don’t get over-hyped on all that stuff. Get stuff that works for you and that makes it simple to buy and sell houses, or whatever your business is. So maybe that was a big spending mistake.

Joe Fairless: I’m not asking you to name a name of the system or the software or whatever, but I would be curious to know – and I’m sure the listeners are as well – what functionality did that have that you were like “I don’t need that.”

Raul Balufe: Well, functionality maybe not so much, but more like — for instance, I had one CRM for buyers, one CRM for sellers; I had another CRM for contacts… But one CRM could have done all three, if you can find a way to customize it, or whatever. So I was kind of like falling in love with “Oh, this CRM has this feature, this CRM has these features”, but do I really use all those features? I’d rather just put in one platform and customize it as best as I can, even if it takes a little bit more labor… But really get it on one system so it’s just more organized, more clean. You go to one place to find all your leads, one place to do your follow-ups… It works a lot easier.

Joe Fairless: What CRM do you use? Because obviously you’re happy with it if you’re using it.

Raul Balufe: I use FreedomSoft. I’ve been using it since I’ve started. It made a lot of good changes recently. I know Rob Swanson took over not that long ago. I really like it; it works perfectly for me. For buyers, sellers, you can put your contracts on there… I like the new leads tab; you can get phone numbers, and stuff… It’s pretty cool. I don’t even use all the features, but it has a ton for me to use and it’s really user-friendly. It’s nice, I like it.

Joe Fairless: Best Ever listeners, you can listen to our interview with Rob Swanson, episode 772, how he scored ten million dollars at the bottom of the real estate market.

What is your best real estate investing advice ever?

Raul Balufe: My best advice is pretty much staying consistent. I was actually talking to somebody today – it’s really easy to give up in real estate. Real estate was never made to be a short term gain type of business; it’s always been like a buy and hold business, or buy your home, resell it in a year, or whatever. If you stay consistent, constantly talking to leads, sending mail or whatever way you like to get leads, and you take the right actions, you can succeed; you will succeed. You just have to be consistent.

Joe Fairless: How do you educate yourself? Because your mind has evolved more than other early 20-year-olds that I’ve come across, so clearly you’re into personal development, and you’ve mentioned some podcasts… Where do you get that information from, and have you always been that way?

Raul Balufe: I’ve always been very curious and I kind of wanna know how everything works, so that was kind of like in my nature, but podcasts have helped me a lot. You can just find so much information on podcasts… Your podcast – you have a ton of interviews with very interesting people, successful people… A ton of all these other real estate podcasts – I mentioned Joe McCall, Sean Terry, Matt Theriault… If you just listen to a bunch of these podcasts, you get a lot of knowledge… Way more than you even need. So that definitely helps a lot.

I read books… I know you’re big on books; you ask for everybody’s favorite books at the end of this show… So I love books, podcasts, YouTube, webinars… A little bit of everything. There’s tons of free education out there.

Joe Fairless: What are some of your favorite go-to resources?

Raul Balufe: Well, I purchased some of the courses from Sean Terry and Matt Theriault – I’m constantly going back to those courses. I like to refeed that material back in me; even if it’s like the basics, it’s always important to know the basics. Once you fully understand that, you can really start thinking like “Okay, in my business how can I implement the basics again?”, whether it’s sending mail, or… However you get leads – MLS – you always gotta go back to the basics, buying and selling. That really helps me a lot.

Podcasts – I listen to your podcast, I listen a lot to Matt Theriault and Epic Real Estate…

Joe Fairless: Now I wanna go back to the direct mail marketing, because you said that’s been the best investment you’ve made back into your business, and you’re consistent with it. Will you define what consistent is as far as frequency and how many you send out?

Raul Balufe: I’ll get a list and I will send once a month for six months minimum. Whatever list that may be and however many people, I’ll send for a month, every month, six months straight… And different pieces of mail. I’ll send a postcard one month, a letter the next month, then another postcard, then another letter… All different for six months. I think that anybody hitting a list should at least hit it three months back-to-back-to-back, and for ultimate results, six months.

Joe Fairless: And have you looked at how many leads you’re getting from the one, two, three, four, five and six-month mailers and have you seen which mailer generates the most leads as far as one through six months?

Raul Balufe: I have tracked that, however I will say — that’s kind of a good question, but what I see is that I get easier sales or easier acquisitions months four, five and six. Maybe the leads won’t be the same amount, but it’ll be a lot easier to get that house under contract, because they’d already seen my name for three months or four months; I don’t know if that makes sense.

Joe Fairless: Yes, that does. Are you ready for the Best Ever Lightning Round?

Raul Balufe: Yeah, let’s do it.

Joe Fairless: Alright. First, a quick word from our Best Ever partners.

Break: [00:18:08].15] to [00:19:00].00]

Joe Fairless: What’s the best ever book you’ve read?

Raul Balufe: The 10X Rule by Grant Cardone.

Joe Fairless: He’s a Florida guy, isn’t he?

Raul Balufe: Yeah, he lives in Miami. He lives in [unintelligible [00:19:06].27]

Joe Fairless: Best ever deal you’ve done?

Raul Balufe: The second property I bought – a single-family home. I bought it for like 47k, put in like 20k; I’ve been renting it for three years and I just got it appraised for like 150k.

Joe Fairless: Congratulations. How did you get the money to buy that single-family home?

Raul Balufe: I had already wholesaled a couple houses, so I had some money saved up. Then I got a hard money lender.

Joe Fairless: Do you still have that hard money loan on the property?

Raul Balufe: I do, I have renewed it for these years, but I am in the process of refinancing it with a conventional bank.

Joe Fairless: Best ever way you like to give back?

Raul Balufe: I actually enjoy teaching and mentoring people who are not as fortunate or maybe not as savvy with information or school. I like to kind of just speak motivation to them as much as I can, and share with them any secrets or anything that helped me along the way or keeps helping me in my business. I like to help people who kind of see things a little bit differently.

Joe Fairless: What is a mistake you’ve made on a transaction that you can think of?

Raul Balufe: On a transaction… Definitely with buyers – collect their escrows. That sounds simple, but man, these buyers are sharp.

Joe Fairless: Will you elaborate on that?

Raul Balufe: So if you’re selling a wholesale deal, a lot of times for me if I’m doing [unintelligible [00:20:35].05] I gotta put that escrow; so I’ll sell it to a buyer, I’ll get the contract signed, and in the beginning I kind of put it off, like “Okay, it’s a done deal…” But then a week will pass by, they never followed up, they never sent deposit, and they’re like “Okay, I don’t want the deal anymore for some reason”, and now I have to rush and find another buyer, do this, do that… That will all be avoided if you collect the deposit or have them sent to the title company when you sell the property to them.

Joe Fairless: What’s the best place the Best Ever listeners can get in touch with you?

Raul Balufe: They can go on our website or our Facebook, Capital Rise Investments LLC, or CapitalRiseInvestments.com. I have my office number there and my e-mail – all that information if you guys wanna get a hold of me.

Joe Fairless: Raul, thank you for being on the show and talking about how quickly you’ve gotten out of the gate in real estate, in two years, from 21 to 23, having wholesaled on average over 15 million dollars, which I think was on average like 200 or so houses (I think) when I did that math…

Raul Balufe: Right. 80 houses a year.

Joe Fairless: Yeah, 160… Yeah, I knew that didn’t sound — yeah, 160. I was doing the math off of the 68k, so that’s what it was. But it’s very impressive what you’ve done and the team that you’ve built, and how you have put a premium on the learning and then applying what others have done and then replicating the model. I think that’s the storyline for this conversation – you’re not recreating the wheel, you’re simply implementing what’s been proven that other people have done and you’re taking massive action and you’re scaling along the way.

Raul Balufe: A mix of education and action is definitely the way to go in any type of business or in anything you do in life; as long as you learn the right things from the right people and implement the action and you do it consistently, you’re set up for success. You cannot fail.

Joe Fairless: You summarized that much better than I could. Thanks for being on the show. I hope you have a best ever day, and we’ll talk to you soon.

Raul Balufe: Thanks, Joe. I appreciate it. Take care!



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JF771: You’re Not Running a Wholesale Business Until You’ve Done This

Have you failed yet? Do you consistently month after month wholesale properties with the team that works cohesively? If you’re still struggling then you may not have all the pieces. Our guest is extremely persistent and has had it pretty rough before he finally started to net approximate $13,000 per deal, hear how he did it and how he built his team.

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Alex Pardo Real Estate Background:

– Founder of FlipEmpire.com & Creative RE-Solutions, LLC
– Has flipped well over 300 properties
– Specialize in wholesaling residential and multi-family real estate investments
– A former GE financial analyst
– Based in Miami, Florida
– Say hi to him at www.FlipEmpire.com

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JF754: A 5 Step Process for Raising BIG Capital #skillsetsunday

Today’s guest has been on the show, and he is an expert at managing big money. If you recall on episode 447 he manages the family office for billionaires. In this episode you hear his five steps to raising private capital.

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Richard Wilson Real Estate Background:

  • Works with $100 million families
  • CEO of the Family Office Club, largest community of family office professionals with over 1,000 registered family offices and quarterly live events
  • Runs a single family office with over $500M in real estate assets and has three billionaire families under contract as their buy-side deal advisor
  • Author of #1 bestselling book on Amazon within the wealth mgmt. category called, The Single Family Office: Creating, Operating & Managing Investments of a Single Family Office
  • Host of the popular podcast Family Office Podcast
  • Based in Miami, Florida
  • Say hi to him at singlefamilyoffices.com

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JF568: Why He Finds the BUYER Before He Negotiates the Deal

Our guest is creative, and serious about all his exit strategies. He finds a buyer before he negotiates a deal which will ensure the sale. We also purchased a large commercial building and bought out the tenants to re-rent at higher rates to eventually create a better cash flow investment to resell later. You have to hear this man’s show!

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Adam Cohen real estate background:

  • President of West One International
  • 23 years of experience as a real estate investor, hard money lender, developer and advisor
  • Based in Miami, Florida but works in the UK as well (as you’ll hear from his accent)
  • Say hi to him at Westoneinternational.com
  • His Best Ever book is The Magician by Raymond Feist

Listen to all episodes and get a FREE crash course on real estate investing at:http://www.joefairless.com

Are you committed to transforming your life through Real Estate this year? If so, then go to http://www.CoachWithTrevor.Com and claim your FREE Coaching Session.  Trevor is my personal real estate coach and I’ve been working with him for years. Spots are limited, so be sure to do it now before all the spots are gone.

Subscribe to Joe’s YouTube Channel here to learn multifamily and raising money tips:https://www.youtube.com/channel/UCwTzctSEMu4L0tKN2b_esfg

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JF447: What BILLION DOLLAR Investments Look Like with a Single Family Office

Yes, billion with a “b” is what you saw in the title. Our Best Ever guest researched general investments and stumbled upon the Family Office sector. He began blogging about the niche and grew fascinated while working a day job…then it exploded. Hear how he was invited to speak around the world and manage investments of up to three billionaire families!

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Richard Wilson’s Real Estate Background:

  • Works with $100 million families
  • CEO of the Family Office Club, largest community of family office professionals with over 1,000 registered family offices and quarterly live events
  • Runs a single family office with over $500M in real estate assets and has three billionaire families under contract as their buy-side deal advisor
  • Author of #1 bestselling book on Amazon within the wealth mgmt. category called, The Single Family Office: Creating, Operating & Managing Investments of a Single Family Office
  • Host of the popular podcast Family Office Podcast
  • Based in Miami, Florida

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JF298: Why YOU Need to Start Gaining Clients From Social Media

Today’s Best Ever guest shares with us how he gains clients from social media and his blog and how to determine what is REAL and what is speculation. We also discuss all you need to know about real estate investing in Miami, and why it may be the market you are forgetting about.

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Adrian Foley’s real estate background:

–          Attended law school and keeps his law license active but focuses the bulk of his time to real estate

–          Real estate agent at GSL Properties based in Miami, Florida who works with buyers and sellers in Miami’s top luxury submarkets

–          Fluent in both English and Spanish

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Made Possible Because of Our Best Ever Sponsor:

Patch of Land – Want to learn more about crowdfunding? Let the leading expert in the crowdfunding space, Patch of Land, give you all the info you need to get started. Grab your FREE copy of Top Ten Answers to the Top Ten Crowdfunding Questions athttp://www.PatchOfLand.com/bestever

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JF190: Using a Video LOI to Win a Deal that Netted $20M Profit

Today’s Best Ever guest shares with you the journey to go from nothing to a millionaire. He also tells you about the power of a video LOI and how that helped his beat out 38 other bidders to win a deal.

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Grant Cardone’s real estate background:

–        New York Times bestselling author and has written four business books including  The 10x Rule and If You’re Not First, You’re Last

–        Spent more than $280 million on real estate in last two years and plans to invest $1 billion by the end of the decade

–        Appeared on HGTV’s reality show “Selling LA” to market his $18 million LA home and has since moved to Miami, Florida

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Sponsored by Patch of Land – Could you do more deals if you had more money? Let the crowdfunding platform, Patch of Land, find investors for you and fund your next deal…and your next deal…and your next deal…and…well, just go find out more at http://www.PatchOfLand.com

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JF162: Insider Scoop on Blind Pool Funds AND What You Don’t Know About Note Buying

Today’s Best Ever guest shares how blind pool funds work and gives you info on next level financing advice based on his extensive experience in the real estate finance industry.

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Dion DePaoli’s real estate background:

–        CEO at Secure Debt Exchange Systems based in Miami, Florida

–        Direct experience with real estate and mortgage investment fund management, asset management and disposition

–        Over 15 years in real estate finance and you can say hi to him at http://www.sdxs.us/

Subscribe in  iTunes  and  Stitcher  so you don’t miss an episode.


Sponsored by Patch of Land – Could you do more deals if you had more money? Let the crowdfunding platform, Patch of Land, find investors for you and fund your next deal…and your next deal…and your next deal…and…well, just go find out more at http://www.PatchOfLand.com

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JF32: How to Collect the Most on an Insurance Claim

You’re standing in 4 feet of water. What’s your next step to getting the problem fixed and reimbursed for the damages? Today’s Best Ever guest is a public adjuster who represents property owners when they file insurance claims.

Tune in to listen to his Best Real Estate Investing Advice Ever!

Les Weitman’s real estate background:

– Works as a public adjuster representing property owners who file insurance claims

– Became a real estate agent at age of 18

– Host of popular real estate investing podcast called Life on PIRE

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Sponsored by: Door Devil – visit www.doordevil.com d enter “bestever” to get an exclusive 20% discount on your purchase.

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