DE 29: When & Where to Invest with Andrew Syrios

DE 38: Small Town-Big Deal with Carlos Gutierrez

 

On today’s episode, our guest Carlos Gutierrez is based out of South Carolina. He started flipping homes and eventually made his move to commercial real estate. He started with a 20 unit deal and since then has doubled his success with recent deals. He has an avid passion for motorcycles and he owned a shop Deltona, FL. 

 

In today’s episode, Carlos discusses how he entered the real estate game, details on his first house flips, how he found his first 20 unit deal and his future plans. He also shares with us, his goal with multifamily properties and how he found his formula to success. 

 

Episode Highlights:

• Details on His 1st Deal
• Recent Deals on Multifamily Properties
• What Book Motivated to Enter the Multifamily Sector
• His Future Plans

 

Connect with Carlos:

Email: [email protected] 

Facebook: @CG4propertiesllc

Office #: 843-934-4250

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TRANSCRIPTION

Intro: Hey guys, and welcome back. Today I am interviewing Carlos Gutierrez. I think Carlos and I share a similar path as well as so many other real estate investors. We both started in flipping homes and ended up deciding we want to scale up and start doing something bigger, hence getting involved in commercial real estate. So, I think this is the standard evolutionary process and progress of the typical real estate investor. And I'm sure many of you guys are either in this position or have been in this position in the past, which is why I think this episode is super important. So have fun, and let's get started.

 

Lady: Welcome to the commercial real estate investing podcast with Don and Eden where we cover all aspects of real estate investing with special attention to off-market strategies.

 

Don: Hey, Carlos, it's nice to have you here. How are you doing today?

 

Carlos: Good. How are you guys doing?

 

Don: I'm doing just fine. I just got back from North Carolina looking at a property that is close to South Carolina, obviously, which is where you're based off. How are things in South Carolina? I can tell you that when I went to Charlotte right now when I was on the flight, there were a few tornadoes that just hit the city. So, when I landed in Charlotte, everything was like a mess. 

 

Carlos: I've lived here in Charleston probably for almost five years. We've had experiences with some close tornadoes in the area. When I mean close, I mean, like two or three miles down the road. 

 

Don: Wow. 

 

Carlos: Yeah, so we had one real bad one, think that September of 18. Took the roof off of the DMV building, a place that sells trailers and cars, flip trailers upside down. It was destroyed like Main Street, which is Machs Corner, which is five to 10 minutes up the street from where I live. I've lived through a lot of hurricanes because I'm originally from Puerto Rico and then grew up in Florida, so hurricanes don't bother me as much and you have time to prepare. And I tell you what, man, those tornadoes are scary. I was telling my wife the other day I was going to build one of those doomsday bunkers underneath our house. You literally have no time. And by the time they said there's a tornado on top of that you got less than a couple of minutes.

 

Don: Yeah, to get in right? So, I know you flip a lot of homes in South Carolina. Did you ever have any situation where you had one of your homes get impacts from any type of bad weather whatsoever?

 

Carlos: I've been fortunate enough to have any disasters hit any of our houses or any of our commercial property. We've been through hurricanes, we've been through tornadoes, we've been through some flooding and I haven't had anything major other than maybe a couple of our units getting flooded.

 

Don: That's a good thing. I know you flipped a lot of homes. So, you've done like over 20 flips, right?

 

Carlos: Yeah, yeah.

 

Don: So how about you tell us a little bit about that and how it started. How did you get into real estate and what was your first deal and how did they go?

 

Carlos: I lived in Florida for about 20 years and before my real estate career, I had a big passion for motorcycles, and I own a small motorcycle shop in Florida in a place called Deltona, Florida. So, it was a really good solid mom and pop shop business. We did great for about three to four years. And then, of course, the '08 recession happened. '09, I started seeing the wave of revenue was split in half the landlord of that we were in a retail shop and the landlord was, there are people closing up left and right. So, going through that recession, I learned that I was in the 'want' business and not the 'need' business, which taught us a real valuable lesson. You might want the motorcycle, you might want a jet ski or a boat but when it comes time to a bad recession or anything like that, you usually have to let go of all of it. I wasn't in the real estate business then but I did see it. I saw people that were living in $75,000 houses, which is kind of normal in that area, and selling it and buying a $200,000 still having the same job. I was just like this doesn't make sense. 

 

Sure enough, the recession hit '08 '09 and those same houses that were selling for $200,000 are now selling back to $75,000 and even less in some instances. So, I met my wife in Florida and we moved to Northern Virginia. She's from Northern Virginia. She wanted it to raise kids there. The economy was really bad in Florida so we moved up to the Northern Virginia/ DC area. I saw the real estate market being dilapidated in Florida. I was like when I get to Northern Virginia, I'm just going to start looking. I started looking with some realtors. They walked me away from a lot of houses, probably three or four houses that I could have made some good money, so I decided to get my real estate license. I said, if I'm going to do this, I'm going to do this myself, having that small mentality at that time, but I saw opportunity out there. I bought a HUD home for $68,000, put about 24 to 25 grand into it because I was doing a little bit of the work myself, which I don't recommend, but since it was my first I had more time than money, right? 

 

Don: And you wanted to learn. 

 

Carlos: And I wanted to learn. Yeah. And I knew a little bit about construction because I had done some construction before.

 

Don't: You invested $92,000 in the property, right?

 

Carlos: Correct. Yeah, I was able to actually talk to a broker that was like a hard money lender at the time. So, she did the loan and we worked everything out, was $92,000 into the property maybe a little bit more with some holding costs. And it took us about a month and a half to do all the renovations. Three days before Christmas, I put her on the market. And I had two or three offers within a couple of days. I ended up selling it for $142,000.

 

Don: $142,000. So, you cleared about $30,000 closing costs. Yeah, so that's a decent return. You can't get that done easily today.

 

Carlos: No. Back then, if I would have known what I had in my hand, I could throw a dart and hit a good deal back then. They were throwing houses. I didn't have enough money to buy them all.

 

Don: Yeah, didn't we all I mean, we're talking about a time where you could pick up a house for literally cents on the dollar. And I was thinking that if I lived this era all over again, I would have never sold anything. My biggest regret is selling real estate. Everything that I ever did in real estate that's one thing that I'm truly sorry about, the one mistake is I sold real estate. I should have never done that, I should always keep it. I don't believe in selling it. I started as a wholesaler. And so, at these times, we were making good money. 

 

And now in 2017 and 2016 people started hearing there's a lot of money in wholesale. And, and so they got into it. And there's also podcasts and audible and so people can get information. Very easy way. So, then it got saturated. I know what a flip is. So, you're averaging between $40 and, and $50,000 if you're doing well. So, you're making $200,000 a year, but that's the point where you realize that essentially you have a job and that's not going to get you anywhere. So then move up the ladder and start investing in some bigger things. That's when things change and you move up to commercial real estate, right?

 

Carlos: Correct. Yeah. So, my whole mentality from the beginning is kind of the same thing that you were just talking about is holding for the long term. But I wanted to flip houses to get a big nest egg to start putting it down on bigger properties and holding them for longer. I didn't want to hold single families for a long time, but I wanted to buy and hold multifamily. So that was the goal from the beginning. I read a book, a real good book back in probably '09. Dave Lindell's 'Multifamily Million.' 

 

Don: I went to a seminar. 

 

Carlos: Yeah, me too. He's from the New Jersey, Philadelphia kind of area. So, I went to one of his three-day boot camps up in Maryland.

 

Don: I went to his three-day boot camp in Tampa. Yeah, well, let's get back to the topic. So, you read Dave Lindell's book 2009, multi-family millions and then that makes an impact and you decide to start investing in multifamily right?

DE 37: Good Research = Smart Investing with Scott Price

DE 37: Good Research = Smart Investing with Scott Price

 

Today’s guest has sharpened his skill sets through key roles in various companies as a team manager, program manager, and marketing manager- Scott Price. In 2005, he purchased his first apartment complex of 29 units. He used the full‐time broker status to immerse himself in real‐world real estate, investing and applied education. After being approached by some people, Scott began to provide professional coaching for aspiring real estate investors.

 

In this episode, Scott shares with us the details of his first deal- what he learned and what he’d do differently, how he managed a full-time W2 job & real estate investing on the weekends, how he became financially free and his current deals. 

 

Episode Highlights:

• Real Estate Beginnings
• Scott’s Retirement Plan
• Advantages of Real Estate
• A Memorable Deal
• 1:1 Coaching

 

Connect with Scott:

Website: bonvolo.com

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TRANSCRIPTION 

Intro: Hey guys, welcome to the show. Today, I'm very excited to host Scott Price. Scott is a real estate investor. He's also a hard money lender. He's an active investor. He's a passive investor. And he's also a coach. Now, if you're asking yourself, how is it possible that you can do all these things, then I guess it's just a type of business that real estate is. It's just being diverse, being able to think long term. I think what I like about Scott is his long term vision. And that is a key feature that you got to have. It's something in your mindset, you got to understand that real estate is a long play. So, you got to be patient, and you got to keep working, you gotta keep grinding, and you have your way of doing this. So, Scott's way of doing this is working a W2 job as he's investing in real estate. That's a safe way and that's a very nice way to do things. So yeah, I think Scott has a lot of value to give. So, without further ado, let's get started.

 

Lady: Welcome to the commercial real estate investing podcast with Don and Eden where we cover all aspects of real estate investing with special attention to off-market strategies.

 

Don: Hey, Scott, welcome to the show.

 

Scott: Hey, Don, thanks. I'm looking forward to being here and talking to you.

 

Don: Yes, I'm also looking forward to having you here because I know this interview was rescheduled so many times just out of coincidence, and I really wanted to have you on the show. I think what you're doing is truly phenomenal. And I know you've been listening to the show also, as well. So, you've been there on the side of the audience and listener and also now as somebody who's being interviewed, so I'm very happy to have you here. And yeah, let's get started. Tell us a little bit about your career, your real estate career and how you got started in real estate.

 

Scott: Sure. I would say it first started many years ago, was looking at what am I going to do with my life and how am I going to become independent in terms of financial lifestyle and not dependent upon the winds of a company. And even going back to before college, I was thinking those kinds of things, certainly did during college as well and I kind of started on the usual approach of most people who have got a good job, go to a good school and things like that. But from all the research that I did, the thing that kept coming up over and over again was that people who maybe we're not household names, but they were people who developed a combination of recurring income as well as net worth. It kept coming back to real estate that some people would win the lottery by great IPO or their stock or something like that but it tended to be a smaller percentage, and it was a real roll of the dice as to whether or not you happen to be in the right company or not, or things like that. 

 

I didn't want my life to be a chance, I wanted to be something that I could control and expand on. And to me real estate was that thing after looking at a lot of different options because it is doable, it's something you have to work out but at the same time, if you are diligent about it, get educated and don't rely on excuses but take action, it is something that can get you there both in terms of recurring income and net worth. What I did was I worked a regular W2 job primarily in high tech and usually in program management and team management positions. And at the same time, in the evenings and weekends, I was working on real estate. For one time back in 2005, I was a full-time real estate broker, but I just did that for a few years and was just to get into real estate investing to immerse myself. I still have my license right now, but I don't represent clients. I currently have it purely for investing purposes.

 

Don: So, you started back in 2005 right, and then you quit for a few years. I guess you quit because of the crisis?

 

Scott: I'm giving an approximate from 2003 to 2007. I was a full-time broker and I primarily got out of it because I was doing some commercial, which interested me, but I was doing mostly residential. And frankly, I got kind of tired of all the tire kickers. It's such a numbers game kind of job, some people love it. And that's all great. But I want to get paid for my efforts and for the clients I had, who were good to work with. But the people who would waste my time driving around for six months and then decided not to buy it got a little old.

 

Don: Yeah. 

 

Scott: So, I decided to go back to W2 actually to work for good companies, good jobs and make a good income with that and not have to worry about all that kind of stuff. But at the same time on the side, again, in the evenings and weekends, I was actively working on my real estate investing. And my general approach was, all of my expenses for me and my family were taken care of by my job, as well as the benefits that I got and the ability to say It's a lot easier, especially for smaller loans to get a loan, if you have a W2 then if you don't if you're self-employed, things like that. So, I use that all to my advantage. I was very strategic and intentional about that. And by doing that, then all of my income, as well as profits from building up equity, doing a cash-out refinance, things like that, as I went along, I could directly roll that back into more real estate. 

 

Again, it was part of a larger plan of not going to work W2 forever, didn't want to do that. But I was using the W2 job as a way to help me expand my real estate portfolio even more. And everything that I own right now is I own myself or myself and the bank, as they say, if I've got a loan on it, but had a need for co-investors, although I have worked with debt investors, and so that allowed me to build up a portfolio. I stayed with it for quite a long time until a couple of years ago. And then I got well past where I needed to be, but I wanted to be again very conservative. And then I had both income and net worth enough to just say, Okay, I'm going full time. So, I did that a couple of years ago.

 

Don: Okay, so yeah, that's very interesting. So, you decided to go full time two years ago, right or a couple of years ago, excuse me for asking it so bluntly, but how old are you? 

 

Scott: I am 52.

 

Don: 52. So most people would retire when they are 64. And what I like about what you're doing, is the fact that you saw real estate as a long term investment for your life, for the way that you vision your life, right? So, you wanted to take all the money that you make from your W2, your good paying job, I know you were doing a high tech and you did team management for big companies. And so, you got paid well, I assume. And then you got that money and you paid the bill with that money, but the equity that you generated to real estate investing that you just rolled on, and that's how you got bigger and bigger and bigger. 

 

And by the age of 52, you are financially free, which is a lot sooner than most people, I mean, you went down the road of the safer option, because I see a lot of people that are doing this, that they have a good-paying job but they know that they don't want to do this forever, and they want to retire earlier than most people. And so, they take the money and they live with it. And the money they make in real estate, they don't take anything out, you just push it back into the business, whereas a real estate investor, you have to also take money outside of your business so that you could live and pay your bills. Right?

 

Scott: Absolutely. And, of course, actually did two years ago, so that was at 50. And then on top of that, I could have easily done it earlier. Just to be clear. I mean, I've been building enough that easily five years earlier, and that if I wanted to, I could have done that 45 or probably earlier. So, it was just a matter of saying well, I want to be even more comfortable. In other words, I want to have a little bit more properties, I want to have a little more income coming in and things like that. And then finally got to the point where I felt comfortable enough with it.

 

Don: There's another thing that I want to talk about from something that you mentioned at the beginning. You said that you noticed that it all leads up to the real estate. It doesn't matter who you are, what you do. At the end of the day, the majority of them are in real estate. And the questi

DE 36: From Real Estate Agent to Independent Investor- with Brie Schmidt

Joining us today is Brie Schmidt, a Chicago based real estate investor. She began her career in corporate sales while always holding her real estate license current. In 2011, she decided to leave the corporate world to become a full-time real estate investor. Since then, she has bought several properties in the Windy City and Milwaukee. In 2014, she started a brokerage company and in 2017 she started a conference business. Brie makes use of her extensive knowledge of constructing and managing a portfolio to teach clients about all aspects of buying and holding investments.

In this episode, she talks about her career as an investor, how she started and how she got to where she is today. Brie discusses how and why she decided to focus on the Chicago & Milwaukee markets, criteria she looks for when deciding on a property and her plans for the future. 

Episode Highlights:

• Brie’s Start as a Real Estate Investor
• Cap Rate Criteria for Properties
• Work-Life Balance
• Her Future Plans

Connect with Brie:

Website: Second City Real Estate

 Social Media: BiggerPockets or LinkedIn

Join Brie @ the Midwest Real Estate Networking Summit

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TRANSCRIPTION 

 

Intro: Hey guys, today Don with interview Brie Schmidt. Brie is the first female investor on our show, so we are very excited to have her here. We really hope this episode will inspire other female investors to jump right in the arena of real estate investing. After listening to the interview, I have learned from Brie that this type of profession actually enables a future mom to enjoy both worlds have a very successful career and the ability to take as much time needed for recovery and raising your newly born child. Don and Brie will also discuss the best strategy of choosing a market which is going there and seeing it firsthand. I hope you guys will enjoy this show.

 

Lady: Welcome to the commercial real estate investing podcast with Don and Eden where we cover all aspects of real estate investing with special attention to off-market strategies.

 

Don: Hey Brie, welcome to the show.

 

Brie: Thank you for having me.

 

Don: Yes, of course. I'm very excited to have you as you know, you are the first female investor on the show. I've been trying to get a female investor for quite a while. And I know we've wanted to do this interview for a long time.

 

Brie: Yeah, I just had a baby. So, scheduling has been a little bit difficult for me.

 

Don: I could only imagine how difficult it would be to be a real estate investor and also being pregnant and taking care of babies. That must be requiring a lot of toll from you, right?

 

Brie: You learn to prioritize your time, right, and what's important and it's been something that I've been considering a personal mission of mine for a few years. When I started this business, I quit my corporate job back in 2014. So, I started real estate investing in 2011. I bought another property in 2012. I bought another property in 2013. And then I decided to quit my job and do this full time. 2014, I bought another 10 properties, and then in 2015, I bought another 12 and then bought a couple more in 2016. So, at the time when I quit my job, I used to work in corporate advertising sales. I'm like this is going to be great like I'm going from 50 hours a week and traveling all over the country. Now I'm going to be chill and I work from home and I'm self-employed. And for the first few years, I was working more hours than I was when I had a W2 job. 

 

It wasn't until about 2017 that I was really like, wow, like I have started a couple of other businesses, I'm the Managing Broker of Second City real estate, which is an investment, boutique investment firm for agents. I also started a website business and it was like, well, what was the point of me leaving my solid W2 jobs to get 'financial freedom' if I'm working from the moment I get up to the moment I go to bed and weekends. So, when I knew that we were going to start planning for a family I made it a really big objective of mine to kind of reevaluate my position in the business and reevaluate what I was doing and spending my time on and work to shift it. So, I'm very happy to report that even before we got pregnant, I was down to about 30 hours a week, and I'm able to take a nine-month maternity leave, where I'm pretty much only working 10 to 15 hours a week currently.

 

Don: Nice, yeah. So, you get a lot of flexibility. And that's the advantage of being self-employed. And especially in the type of business that we are in, which during the years generates passive income for us. So, it enables us to really take a break when we need to take a break with anything that we go through in life. So yeah, I'm sure that that's been terrific for you and your family. And speaking of which, I want to ask you about the dynamics. So, you're doing your own thing as a real estate investor and your husband, what does he do? Does he spend more time with the kids or does he have a W2? Or how does it look like?

 

Brie: Luckily, we're both off work still. So, we did not get an easy child. She turned four months yesterday. I'm back to work maybe 10-15 hours a week, and I don't plan on going back for another probably four or five months. He's self-employed as well. So, he's taking off work as well. And I don't see him going back in the near future. When people tell you that raising a child is hard like I don't think I fully grasp that concept. But I mean, it takes both of us all day long, tag-teaming things to have your own sanity. Because we both need our own personal time. So that's how we work at currently. But we'll see when she gets older, hopefully, fingers out of this fussy phase.

 

Don: Yeah. Beautiful. So that's very exciting to hear that you guys are doing it right. So, tell us about your first deal. You said 2011. So how did you basically come up with the idea of quitting your job and start investing in real estate? And also, what were the difficulties back in a day for you when you were just trying to get into that market?

 

Brie: Well, in the beginning, I really had no intention of being a real estate investor. So, I've been licensed as a real estate agent for 15 years. I spent the first six months in the business absolutely hated it, quit and went into the corporate world. So, I always maintained my license, though, as a backup. That was kind of my plan. I always had a passion for real estate, but I started when I was 21, was really difficult to get people to trust your opinion and rely on you for advice when you're a 21 year old. Like, why would they listen to you when buying a house. So, it wasn't until let's see, I was 28 when I bought my first property. 

 

We bought a three-flat in Chicago. And really the intentions weren't to be real estate investors, it was mainly purely out of convenience that the Chicago market is quite unique to understand that. So, Chicago is what we, I would consider to be a dense urban environment. There's almost 300,000 2-4 unit properties and just the city of Chicago. So, in a lot of the Northside neighborhoods where I was living, and where I've worked, some of them are between 30% and 60% of the housing stock is two to four units. So, it's very common, if you look at any block of neighborhoods, over half the house is pretty much our two to four-unit properties. But at the time, we had a really low housing stock of single-family houses. So, while my husband and I wanted to buy a single-family house because the housing stock was so low, they only represent about at the time, 15% to 20% of the housing stock. 

 

The prices were very high, and it was very, very competitive. So, we thought to ourselves, yes, we would want a single-family house. They're about 3000 square feet here, but we're not even married yet, we don't have planning kids for a few years, we don't need a 3000 square foot house. So, let's buy this three-unit and then eventually, when we need more space, we can just deconvert the staircase and then make two units and the one and then keep renting out the other unit. And then eventually when we need more space, we can just deconvert the staircase again and now we've got a single-family house that we've grown into as time needed. So that was the original plan. There was really no plan to keep buying any more units either. 

 

So, we did, because we were owner-occupied, we did our three and a half percent down FHA property. I had no idea what I was doing. Like I just looked at it as okay, my mortgage is 2200 and it rents for 2250. like boom, I'm profitable, right? Like, that was all I really how looked at it. I didn't know anything about vacancy repairs, cap-like nothing. We bought it vacant, we got it rented out right away and things were fine and dandy. And this was like great, we live for free now we can start saving for we were planning our wedding so, we were saving for this grand wedding. A few months after we bought the property, my father got sick. He was 60 years old, he was diagnosed with non-small cell lung cancer, which is a very aggressive form of cancer and went through 10 rounds of radiation, 13 rounds of chemo and in nine months and passed away. 

 

Don: I'm sorry to hear that.

 

Bri

DE 35: A, B, C, D and a Mobile Home Park with Andrew Cushman

In today’s episode, our guest Andrew Cushman was a chemical engineer for more than seven years. In 2007, he and his wife decided to follow their entrepreneurial spirit and entered the world of real estate. Their journey began in flipping single-family homes, in which he completed 23 transactions- purchase, rehab & sell. A few years later, he made the transition into the acquisition and repositioning of multifamily properties. Today, he continues his success in the nation’s SE market. 

Andrew discusses how he went through the recession of 2008, his strategy for buying single families and multi-family properties, why he chose the Southeast market. Andrew also shares the pricing strategy he used as well as how he decided to get into the mobile home park asset.

Episode Highlights:

• Learning the Business & Becoming an Entrepreneur
• 2 Categories within Mobile Home Parks
• Bad Market or Bad Strategy?
• His insight on the Next Recession 

Connect with Andrew:

Website:  Vantage Point Acquisitions

 

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TRANSCRIPTION

 

Intro: Hey guys, today I am interviewing Andrew Cushman. And I'm in a very good mood for various reasons. Number one is because I'm very happy to interview such an amazing individual. Andrew is really a professional and I had the chance to talk to him a little bit before the show and kind of understand how he thinks. It really brings me to the point of understanding again and again, that it's all about the mindset, it's about faith or fear. If you're afraid, then you're going to be paralyzed, and you'll never succeed in accomplishing your goals. Cause with no risk, there's no reward, it's as simple as that. You'll also hear during the interview, how Andrew is a thinker and he goes against the herd, which is something I personally believe in. 

 

I think it's always important and smart to go against the herd and analyze your own life and environment with total faith in yourself and your abilities. I think really, Andrew is that kind of person, which is why I enjoyed the conversation with him so much. The second reason why I'm in a good mood is that me and Eden are getting close to this mobile home park deal that has 70 units. I had a great time underwriting the deal and learning more about the specific market, where it's located. I guess I'm grateful. I'm just truly grateful for doing what I love, really being able to do something that is big and invest in real estate. 

 

Sometimes I think about it, and I can't believe it, that I'm doing these things. And I really want to help others achieve the same goals and change their lives. So, I guess this is an opportunity for me to say that I'm grateful for you guys as well as our listeners, and I hope you are learning what you need here. And that in the future, when you are successful in real estate or in a future deal, then you think about us and the stuff you learned here. I think that's about it. Without further ado, let's get started.

Lady: Welcome to the commercial real estate investing podcast with Don and Eden where we cover all aspects of real estate investing with special attention to off-market strategies.

 

Don: Hey Andrew, welcome to the show.

 

Andrew: Hey, how are you doing? Glad to be here. 

 

Don: I'm doing just fine. Actually, we just had a conversation before the episode started. And I got to say, I had a lot of fun talking to you about what you do and your outlook. And also, I found out that we have a lot in common, right? 

 

Andrew: Yep. 

 

Don: Yeah. But before we get into that, how about you tell us a little bit about your background and how you got into real estate, to begin with?

 

Andrew: Yeah, I took the standard path into real estate and went and got a chemical engineering degree. But I always knew that was just a placeholder. It was just something that I could earn a decent income. So, I figured out what I would really want to do because I knew I wanted to be an entrepreneur. I worked as an engineer for seven and a half years, married a wonderful woman who had the same ideas I had about trying to be an entrepreneur. And so, we tried a variety of things. And they were fun and minorly successful, but they weren't something that could really accomplish her financial goals. And then, I think in 2007, we found, we discovered home flipping and we started doing that here in Southern California. We did our first one and then I said, "You know what, this is our best shot." So, went to quit my job. She did the same thing two years later.

 

Don: That's in 2007. So that's right before the crisis.

 

Andrew: We're at one of the epicenters of it Southern California, there were condo complexes here that dropped 70% in value. It was a great time to get into real estate because everyone was terrified. We had no competition. We'd go buy stuff at 50 cents on the dollar, fix it up and sell it at 80 cents on the dollar. So, whoever's buying it was getting the best deal around. And so even though the whole thing was collapsing, we were still making thick margins.

 

Don: Wait, wait, wait, let me figure this out. So, you were buying at 50 cents on the dollar 30 cents on the dollar you said in some cases, and you were selling it for 80 cents? How come? I mean, I know nobody was buying anything back in 2008. 

 

Andrew: There's no such thing as a bad market only a bad strategy, right? And single-family houses, there are always some people who have to move for some reason. Their job gets relocated, family changes, whatever right? So, what we would do is let's say a house is worth 400. We'd say we buy it for 300 or 325. We've renovated for 25,000-50,000 whatever required but instead of listing it for 400, we list it for like 375. So that we were the cheapest and nicest house on the block. So whatever rare buyer was out there, they'd always come pick our house. It never took us even in the worst of the crash, it never took us more than 30 days to sell a house once we listed it.

 

Don: That is just a terrific thing. And you know what, I'm interviewing a lot of investors and entrepreneurs here in the show, I haven't yet found somebody that did that kind of strategy back in 2008. And that's very interesting. And now that I'm thinking about it, it really makes sense to me because I spoke to you a little bit before the show. And I also see how you think right now as an entrepreneur, and I can see the similarity in how you were thinking back then, right? 

 

Andrew: We listed with a local realtor who was really really good. And I remember walking and deal with his office and another realtor sitting at a desk. He literally looked at us and said, "You're flipping a house, are you crazy?" And I was like, everyone else is creating, this is like the biggest opportunity we've seen in forever. So, we did that for about four years and then after three-four years, everyone else started to figure it out. And then also there wasn't that much equity left, it was still a good business, but it wasn't nearly as good. And we kind of said, well, what's the next big thing? 

 

Now all these people losing their house, they can't buy another one for 7-10 years so they got to live somewhere. And the people who still could buy a house, they're scared of it. They don't want to buy a house. So, they still got to live somewhere. We're in a big recession. So that means we're eventually going to be coming into an expansion. So, if we add those three things together, apartments are probably going to do really well sometime soon. And so, we went and found a mentor, a guy who had done 800 units, we hired him to teach us the business.

 

Don: How much you paid him? 

 

Andrew: I don't remember it wasn't cheap, but it was worth it.

 

Don: I love it that you had like an itch of doing something bigger. I feel the same thing as an investor. Like no matter what I accomplished in real estate, there's always room to grow as an investor, there's always something bigger you can do. And that's just amazing because you were doing single families, you're doing great back in the recession. So, you were making money when everybody else was losing money, right? And then you're starting to think about how I can make even more money? So how many single families have you flipped up until you made that decision to move up the ladder of commercial real estate? 

 

Andrew: We were being very careful to only buy deep margin deals so we didn't do a ton. I think when we switched to multifamily, I think we had done like 25 flips in those couple of years. Nowadays, you hear guys are like does 70 a month right? But it's also much, much, much smaller margin. So, we did that full time for four years. And then our first apartment complex was mostly vacant c minus property on the other side of the country out in Macon, Georgia. That was 92 units. We syndicated that which course means we pulled investors money.

 

Don: What year was it? 

 

Andrew: That was 2011.

 

Don: So back in 2011, you're signed to thinking to get into multifamily and commercial real estate and you're looking at Georgia when you're living in Southern California. So basically four and a half hours flight. 

 

Andrew: Yep. 

 

Don: So why did you choose Georgia- Atlanta?

 

Andrew: Idaho and Utah are getting overrun from people fleeing California. And then in the sou

DE 34: Assembling 2 or More Lots Together with Kevin Amolsch

Kevin Amolsch, based in Denver, Colorado, is a very passionate real estate investor. He served 4 years in the US Army right out of high school and worked as a mortgage bond analyst for several large Wall Street firms. In 2008, he started his own financial institute, ‘Pine Financial Group’ which is a nationally known hard money lending company. Kevin is the author of The 45 Day Investor and is recognized as an expert in real estate finance. 

 

In today’s episode, Kevin talks about his start as a real estate investor, raising funds & hard money loans and his 13 unit deal on an assembled lot. He discusses his plans for the future and why keeping your focus is essential. 

 

Episode Highlights:

• Kevin’s Portfolio Details
• Process of Assembling Lots
• His Business Ethics
• Future Plans for Pine Financial Group

 

Connect with Kevin:

Website: pinefinancialgroup.com

YouTube: Pine Financial Group Channel 

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TRANSCRIPTION

 

Intro: Hey guys! Today Don will interview Kevin Amolsch. Kevin is a single-family investor who is based out of Colorado and also does hard money lending. Nowadays, Kevin is in the midst of a 12 townhouse development. What I find interesting is how diversified Kevin is and the commonalities we share. Me and Don also started at single families, moved up to commercial and we are currently developing a 30 unit multifamily in Hollywood, Florida. One of the most interesting things we have learned from Kevin is the process of assembling two lots and approving it with the city. I hope you guys will find the interview interesting and enjoy the episode.

 

Lady: Welcome to the commercial real estate investing podcast with Don and Eden where we cover all aspects of real estate investing with special attention to off-market strategies.

 

Don: Hey, Kevin, welcome to the show.

 

Kevin: Hey, Don, thank you so much for having me.

 

Don: Yes, you're welcome. I know you're a single-family investor and a multifamily investor and you also focus on raising funds and then doing some hard money loans and that's the type of income that you generate. So that you do a lot of things and for that reason, you're on the show, because I bet my audience and our listeners have a lot to learn from you. So, the first thing that I would like to ask you is that the first time that you start to look into real estate.

 

Kevin: Right out of high school, I got into the Army and in the Army what you find is that you don't make a lot of money but you don't spend it either. So, I was growing a little bank account, I was trying to figure out what to do with it. So, I started reading books and one of the ones that I read it most of your listeners probably know is 'Rich Dad, Poor Dad.'

 

Don: Yeah, the famous purple book. Okay, guys, if you haven't read it, then please do yourself a favor and get on with it.

 

Kevin: Yeah, I mean, that's got to be a staple. I don't know if I know any successful real estate investor that has not read that book. Kiyosaki favors real estate. So, I was attracted to it and I started reading more and more and more and I ended up buying my first house. I was just turning 21 at the time. I got out of the Army, moved into the house, moved into some roommates to pay my mortgage for me. And then two years later, I moved out of it and kept it as a rental. I was cash flowing 300 or 400 bucks a month. I saw the value going up. And I knew that real estate is what was going to make me rich. So, I started focusing on it, and I turned it into a career as I was working my way through college.

 

Don: Amazing. So, what did you study in college?

 

Kevin: Yeah, I got a degree in finance, which does help. You don't necessarily need a degree to be successful in this business.

 

Don: Definitely. I always say that on the show that I never went to college. And I don't think in today's world, it's a necessity. I think it's something that you want to do if you want to become a professional if you want to become a lawyer or a doctor, and I think it's definitely for you. If you want to become a successful real estate investor, I don't think it's going to hurt you but I don't think it's something that you need. Because information and gathering knowledge is so easy today with podcasts and books and everything. You did go to college and you studied financials and you became the president of a company that does financial some hard money loans. I'm sure that must have helped you.

 

Kevin: Oh absolutely. But what you learn in college is more like you said, Don, it's more about the corporations and corporate finance. And small businesses are all very different. I mainly went to college because I was getting it paid for and I had the GI Bill paying me every month to go. So now I need a lot of sense for me. I was using student loans to buy houses at the time, it was a good fit for me. I'm not discouraging people from going. Don't get me wrong. I do agree with you, it is a positive thing, but you don't necessarily need it.

 

Don: A lot of people go to college and I see that from my home country. I'm from Israel. When you live in Israel, you go to the Army, it's mandatory. So, for us, we don't have a choice. So, we got to go for three years and then women go too, they go for two years. So, by the time we get out of the Army, we're already 21 so some of us you know, after the experiences we've had, we want to go and travel, get to see the world a little bit. And then by the time we get back, we're 22, women 21. So, a lot of people are very stressed. As a reality check, and they're starting their lives, but they're 21. So, they feel that they have to go and learn something so that they can have a degree so that they can feel safe about themselves and good about themselves. I know here in the United States kind of different because you're fresh out of high school, you can go to college, you're doing that when you're 18. So, then you finished by the time in 21-22, and then you have a lot of time to do things with the things you've learned. So, I know it's different. Maybe it's not my place to talk about this. But I think, still, wasting time or investing time incorrectly is a very big problem. And I think if you're investing it in something that you don't know what you'd want to be dealing with in the future could be more of a liability than an asset, even if you finished by the time of 21. Don't you agree?

 

Kevin: I totally agree. 

 

Don: Yeah. Okay. Let's talk more about real estate. So, I know now you own 20 units. So, you have 20 doors, some of them single families, some of them multi-families, and you're based out of Colorado, Denver, right? 

 

Kevin: The western side of Denver. 

 

Don: Yeah, so the Denver I must say, so Metropolis area. Your properties, are you holding primarily in Colorado?

 

Kevin: I got eight properties in Memphis and the rest of everything I own is in Colorado. Looked at other areas, but it's difficult to have properties outside your own backyard. So, it's been my preference to try to stay close.

 

Don: Yeah, definitely. So, these units, you said few of them single families and then some of them are duplexes or triplexes?

 

Kevin: Yes, some small multies but let me give you an idea. I am shrinking my portfolio right now. I had a fourplex that I had a lease option on and my option was about to expire, I ended up exercising the option on that and combining it with the next-door neighbor's lot. And now we're building 13 units. Those 13 units are going to be for sale. So, it's a for-sale product.

 

Don: That's very interesting. Let's talk about that. So, you basically had an option to buy, right? So, it was a lease option. And then you exercise the option and then you purchase a duplex, right there was a duplex you said?

 

Kevin: It was a four-unit and I had a 10-year option on it. And so, I exercised it after 10 years, so I already had a pretty low basis in it.

 

Don: How much consideration did you put when you put the agreement?

 

Kevin: Oh, I've never put the consideration down. 

 

Don: Okay, nice. So, you bought those four units for whatever price that you had on the option to buy it. And then you've basically combined the other lot next to it, right? So, you basically did a folio combination.

 

Kevin: Yeah, we just did a little assemblage. Tracking down that neighbor was an interesting story. But I ended up finding him on Facebook. Messaging him on Facebook, because he would never answer his door when I knocked on it. He was nervous. So, we hired a real estate broker. So, the real estate broker and we spoke and he got a full price offer on that property. But you know what, it added more value to me since I own a lot next door than it was who was willing to pay for it. And then we put the two together and created a nice little project that's going to make a bunch of money. But that's just one example. So now I'm going to be down four doors because I converted my for rent product into a for-sale product. 

Don: Yeah, but you're going to be up 13 doors when finishing the development and then you could sell them or you can hold them in, that's up to you right? But I want to ask you about the assemblage. So, you assemble