Financial Freedom with Real Estate Investing

The black swan event financial pundits predicted has arrived in the form of the Coronavirus pandemic. But how, exactly, will the crisis play out in the markets? What does it mean for us as real estate investors? And what can we do to understand the changing reality, protect our wealth, and even capitalize on hidden opportunities? Russell Gray is the cohost of The Real Estate Guys Radio Show, a podcast and platform dedicated to helping investors stay focused, motivated and informed. A financial strategist with 30-plus years of experience in business, investing, mortgage lending and financial services, Russell provides unique and practical insights that support entrepreneurial investors in growing and protecting their wealth through real estate and real asset investing. He is also the coauthor of Equity Happens: Building Lifelong Wealth with Real Estate. On this episode of Apartment Building Investing, Russell joins me to share his take on the bigger story behind the pandemic, explaining how the government bailout will impact the value of the US dollar and its status as the world’s reserve currency. He walks us through the real estate strategies he likes right now, describing the benefit of investments that qualify as both REAL and ESSENTIAL. Listen in for Russel’s insight on protecting your wealth in a crisis and learn what YOU can do to adapt to the circumstances and thrive through a challenging time! Key Takeaways Russell’s take on the biggest story behind the Coronavirus Debt crisis on horizon (more vulnerable now than 2008) Potential for currency crisis as Fed continues to print $ Russell’s insight around the indicators that the dollar is weak Dollar exhibits weakness against other currencies All currencies exhibit weakness against precious metals The consequences of the government’s Coronavirus bailout High risk of inflation Devaluation of dollar How to protect your wealth from inflation, deflation and stagflation Store in alternate form of liquidity like gold to preserve value Invest in real assets (i.e.: real estate in resilient market) Why now is a good time to be a real estate investor Printing money favors debtor Real estate = ultimate vehicle to short dollar The right and wrong way to measure your net worth Assets – liability = wrong way Liquidity + positive cashflow = right way What real estate strategies Russel likes right now Things that are REAL and ESSENTIAL Residential, energy, healthcare and distribution Russell’s advice for investors taking a wait-and-see approach Don’t wait for someone else to find best deals before you Look for real estate (real asset) in resilient markets Connect with Russell Gray The Real Estate Guys Email crisis@realestateguysradio.com for the Crisis Investing Webinar Email silverseries@realestateguysradio.com for the Silver Series Email preciousequity@realestateguysradio.com for the Precious Equity Tutorial Resources Purchase the Replay of Deal Maker Live Learn More About Michael’s Mentoring Program Join the Nighthawk Equity Investor Club Peter Schiff Robert Kiyosaki Reuters Article on the Dollar Index Ken McElroy Equity Happens: Building Lifelong Wealth with Real Estate by Robert Helms and Russell Gray FRED Index on the Purchasing Power of the Consumer Dollar Jim Rohn Chris Martenson at Peak Prosperity Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

According to the Law of the First Deal, a multifamily investor who buys their first apartment building will do their second and third deals in rapid succession, achieving financial freedom in just a year or two. But there is an exception to every rule, and Ed Hermsen is the ONE investor I know who did his first deal—and then life got in the way. So, what can he teach us about keeping momentum and staying committed to our multifamily goals? Ed grew a portfolio of single-family rentals while working as a mortgage loan officer in Fort Collins, Colorado. Five years ago, he started studying multifamily and eventually partnered with a close friend on a 22-unit deal in Pensacola, Florida. After revisiting his goal to retire by 50, Ed realized he needed to recommit to multifamily, and in the last two years, he has leveraged the partnership model to build a portfolio of 210 units and quit his job with real estate! On this episode of Apartment Building Investing, Ed joins me to describe how a 9-to-5 in mortgage banking inspired his real estate investing career and share his secrets to successful multifamily investing with partners. He discusses what made him the sole exception to the Law of the First Deal, explaining why there’s a four-year gap between his first and second deal and what finally inspired him to get back in the game. Listen in for Ed’s insight on the value of accountability and learn what YOU can do to stay committed to your multifamily goals. Key Takeaways How Ed got into real estate Work in mortgage banking exposed to wealth-building potential Bought SFH rental every year to build portfolio of 10 What inspired Ed to pursue financial freedom with multifamily Never off clock, have to take calls (even on vacation) Rely on real estate agents + economy for livelihood Ed’s first multifamily deal Friend found 22-unit in Pensacola, FL in 2015 Bought for $740K, valued at $1.5M now No distributions first year (units in bad shape) Challenge to manage vendors from afar Ed’s second multifamily deal Purchased 88-unit in Wyoming with 3 partners Lead from attorney handling family dispute Great loan from local bank, refinancing now How Ed found his partners Kids go to school together Clients from mortgage business Ed’s insight on building successful partnerships Accountability and clear division of labor Invest in attorney to do operating agreement What made Ed the exception to the Law of the First Deal Went back to buying fourplexes Fell back into 9-to-5 routine Ed’s advice around staying committed to your multifamily goals Write down goals and revisit every morning Build in accountability with mentor or coach Ed’s latest multifamily deal Bought 100-unit deal in Tulsa, OK with 2 partners Establish relationships with local bank and realtor Must follow housing authority rules What’s next for Ed Put 22-unit on market Look for deals in Oklahoma Learn more about syndications Ed’s advice for aspiring multifamily investors Build good team Get educated on markets Get first deal done Connect with Ed Hermsen Email edhermsen14114@gmail.com Resources Purchase the Replay of Deal Maker Live Learn More About Michael’s Mentoring Program Fellowship of Christian Athletes Hal Elrod The Miracle Morning: The Not-So-Obvious Secret Guaranteed to Transform Your Life (Before 8AM) by Hal Elrod The Ultimate Guide to Buying Apartment Buildings with Private Money Syndicated Deal Analyzer BiggerPockets The Miracle Equation: The Two Decisions That Move Your Biggest Goals from Possible, to Probably, to Inevitable by Hal Elrod LoopNet CREXi Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

Investing in the financial markets is stressful, especially in a crisis. And even if you happen to be brilliant at options trading, $100K in the equity market will still only buy $100K in assets. On the other hand, investing $100K in multifamily will buy you a $500K asset—and earn you five times the return. Not to mention the fact that it’s essentially recession-proof! Bruce Fraser is the Managing Partner at Elkhorn Capital Partners, a private equity firm that focuses on multifamily residential real estate in economically insulated submarkets. Prior to Elkhorn, Bruce ran a lucrative hedge fund, successfully navigating the financial crisis before his research led him to multifamily. In a few short years, Bruce has built a portfolio of 1,600 units, and he currently serves as a member of the Forbes Real Estate Council. On this episode of Apartment Building Investing, Bruce joins me to explain what makes multifamily a better investment than the financial markets, especially through the COVID-19 crisis. He tells us about his first multifamily deal (as one of my early coaching students!), discussing the challenges he faced early on and describing how the Law of the First Deal impacted his real estate career. Listen in for Bruce’s insight on the advantage of choosing a niche in distressed assets and learn his aggressive but realistic approach to scaling a multifamily business. Key Takeaways What makes multifamily a better investment than the financial markets S&P 500 = 2.5% average annual return over last 20 years Multiplier effect ($100K buys $500K asset, earn $100K vs. $20K) Bruce’s first multifamily deal as one of my early coaching students 134-unit property in Fort Worth $5.7M acquisition (raise $2.1M) Sold 14 months later for $7.9M Bruce’s experience with the Law of the First Deal Second deal under contract when first closed Acquire 3 to 4 per year ever since Why Bruce chose a niche in distressed situations More control over occupancy growth than rent growth Create much more substantive equity in short period Why Bruce sought out coaching early on Overcome uncertainty Understand deal structure Bruce’s approach to scaling a multifamily business Manage time wisely (leverage third-party property manager) Be aggressive but realistic Bruce’s experience through the COVID crisis Investors ready to buy and deals available Biggest challenge = lending environment Bruce’s goals over the next three years Double portfolio to 2K to 3K units Centralized position in handful of markets Why multifamily is the best investment through the pandemic Tax efficient distributions Demand for apartments remains high Protects against inflation Connect with Bruce Fraser Elkhorn Capital Partners Email bruce@elkhornpartners.com Resources Goldman Sachs Economic Outlooks Purchase the Replay of Deal Maker Live Join the Nighthawk Equity Investor Club Learn More About Michael’s Mentoring Program Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

There are tons of books out there that teach you how to invest in real estate syndications with other people’s money. But what if you’re the ‘other people’? What resource teaches you how to evaluate opportunities and pick the right sponsor to trust with your money? Brian Burke is the President and CEO of Praxis Capital, a private equity investment firm that focuses on repositioning multifamily properties. An expert real estate syndicator and investor, he has acquired 3,000 multifamily units and 700 single family rentals in his 30-year career. Brian is also the author of the new book, The Hands-Off Investor: An Insider’s Guide to Investing in Passive Real Estate Syndications. On this episode of Apartment Building Investing, Brian joins me to explain why passive investors need to look beyond returns when comparing syndication opportunities. He discusses why the sponsor is a more important consideration than the market or the deal itself, sharing the cautionary tale of an investor who lost her life savings to an unethical syndicator. Listen in for Brian’s insight on the benefit of investing in a non-correlated asset like real estate and learn what questions to ask as you evaluate different investing opportunities. Key Takeaways The cautionary tale Brian included in The Hands-Off Investor Grocery clerk sold fourplexes to invest in TIC syndication Sponsor ran off with money and she lost life savings The three indicators used to measure the performance of a real estate investment IRR Cash-on-cash return Equity multiple Why passive investors must look beyond returns when comparing opportunities Sponsor can manipulate what forecasted cashflows will be Look at what’s behind numbers to determine if reasonable Why the sponsor is more important than the market or the deal itself Bad sponsor can ruin good investment in great market Take time to determine moral character, track record What secrets sponsors don’t want passive investors to know Hidden asset management fees Treatment of bad debt How distributions made The pros and cons of being a passive investor in multifamily syndications Professional edge (make more money working with expert) Give up control, can’t exit if don’t like what’s happening The benefit of investing in non-correlated assets like real estate Drop in stock market unlikely to impact real estate Reduces any single point of failure in portfolio Brian’s advice for skeptical investors looking at multifamily real estate Look at where world’s wealth made Minimize risk with balanced portfolio Connect with Brian Burke Praxis Capital Praxis Capital on LinkedIn Praxis Capital on Facebook Praxis Capital on Twitter Praxis Capital on Instagram Resources The Hands-Off Investor: An Insider’s Guide to Investing in Passive Real Estate Syndications by Brian Burke Brian on Apartment Building Investing EP005 Purchase the Replay of Deal Maker Live Join the Nighthawk Equity Investor Club Download Michael’s Free Report—What’s the Best Investment: The Stock Market or Real Estate? Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

In the world of startups, entrepreneurs take a lean approach early on with an eye to grow quickly. Ellie Perlman applied these principles to real estate, building and scaling a syndication business in a few short years. So, how do you shift from being a syndicator to managing a syndication business? Ellie is the Founder and CEO of Blue Lake Capital, a real estate investing firm that specializes in value-add multifamily acquisition and management. She also leads REady2Scale, a mentoring program for aspiring multifamily syndicators, and hosts the REady2Scale Podcast. Ellie began her career as a commercial real estate lawyer and later transitioned to the role of property manager, overseeing properties worth more than $100M. She earned her MBA from the MIT Sloan School of Management. On this episode of Apartment Building Investing, Ellie joins me to explain how growing up poor in Israel gave her the drive to succeed and share her journey from cleaning synagogues to earning an MBA from MIT. She discusses the decision to start her own real estate business, describing how multifamily syndication fulfilled her vision to both scale quickly and earn passive income. Listen in for Ellie’s insight on the magic of scaling a startup and get her advice on how to grow YOUR real estate business—even if you don’t have a budget! Key Takeaways How Ellie developed the drive to succeed Cleaned synagogues as poor child in Israel to help family Sent to youth village at 15, wanted better for own kids What inspired Ellie to go to law school Married at 18, working 3 jobs to provide for husband Saw education as ticket out of ‘survival mode’ How Ellie developed an interest in real estate Exposed to deals in international real estate department of law firm Transitioned to property management to understand business side What brought Ellie to the United States Pursue MBA at MIT to learn how to start companies Aunt had moved to US and achieved success Ellie’s decision to go into business for herself Desire to fulfill potential as self-made woman Scarier NOT to try than to try and fail Ellie’s insight on the power of believing in yourself Causes to act in way that sets up for success Changes other’s perception of who you are Ellie’s big vision for building a real estate company Reverse engineer plan based on net worth goal at age 50 Multifamily met requirements for scale, passive income What Ellie would tell her younger self Don’t listen to doubters + keep going People project their own fear on you How Ellie thinks about potential discrimination in real estate Focus on what CAN change and improve self Not productive to get stuck in victim mode Why Ellie started a training program and podcast Build relationships with potential investors Learn something new to implement in business Rewarding to see other people succeed Why Ellie is an advocate for scaling your business Burn out when try to do all on own Magic in scaling to grow + grow quickly Ellie’s advice for building and scaling a syndication business Map out business want to create and define roles Choose area of focus, partner or outsource rest How to build a syndication business on a small budget Hire intern through Handshake Pay small stipend or offer equity Connect with Ellie Perlman Ellie’s Website Email ellie@ellieperlman.com REady2Scale Podcast REady2Scale Mentoring Program Blue Lake Capital Resources Register for Michael’s Free Masterclass: How to Do Your First Apartment Deal Register for Deal Maker Live Join the Nighthawk Equity Investor Club BiggerPockets Upwork Handshake Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

Doing something monumental like moving your family across the ocean to Hawaii or buying a 100-unit apartment complex may feel overwhelming. But Brandon Turner has done both of those things, and he contends that any process is easy IF you break it down into a series of tiny actions that take five minutes or less. Brandon is the Founder of Open Door Capital, Vice President of BiggerPockets and Cohost of The BiggerPockets Podcast. He owns more than 500 rental units totaling $20M and has dozens of rehabs under his belt. Brandon’s work has been featured in Forbes, Entrepreneur and Money Magazine, and he is the author of several books, including The Book on Rental Property Investing and How to Invest in Real Estate. On this episode of the podcast, Brandon joins me to share his assessment of the impact of COVID-19 on real estate investing, explaining how we should adjust our underwriting in light of the pandemic. He walks us through his favorite investing strategies right now, describing the opportunities he sees in real estate over the next 10 years. Listen in to understand the marketing techniques Brandon uses to raise LOTS of money online and get his advice on developing a clear VISION of where you want to be—and taking tiny action each day to get there! Key Takeaways Brandon’s assessment of the impact of COVID Depends on whether second round of virus triggers another shutdown 85% confident pandemic will be interesting memory in 6 months How real estate investors should adjust their behavior right now Less optimistic in underwriting (don’t count on raising rents in Year 1) Good time to revisit fundamentals, be more conservative The opportunities Brandon sees over the long term Migration to South as more and more people reach retirement age Invest in mobile home parks, senior living and low-income multifamily How this economic crisis differs from the last recession Last downturn CAUSED by shady practices in real estate Less impact on real estate this time (except vacation rentals) Brandon’s favorite real estate strategies right now House hacking good for new investors Rehab or value-add (BRRRR method) Mobile home parks Brandon’s insight around COVID’s impact on low-income earners Still paying rent at mobile home parks Government won’t allow economy to fail BiggerPockets’ most successful marketing strategies Build trust and credibility with content (blog, podcast) Make money as software company, not education How Brandon uses content marketing in his investing business Build trust and credibility at scale with content Leverage video to raise money, send thank you letters Focus on growing Instagram audience (125K followers) How Brandon architects his life around his family and business Develop clear vision of success, know where want to be Keep asking, ‘What’s the next little tiny step?’ Connect with Brandon Turner Open Door Capital Brandon on BiggerPockets Brandon on Instagram Resources Join Michael’s Investor Incubator Mentoring Program Register for Michael’s Free Masterclass: How to Do Your First Apartment Deal Register for Deal Maker Live Join the Nighthawk Equity Investor Club Syndicated Deal Analyzer Joe Fairless Loom Video Messaging The Book on Rental Property Investing by Brandon Turner Bryce Stewart on BiggerPockets Podcast EP276 Vivid Vision by Cameron Herold Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

You may have heard the prediction that unemployment in the US could reach 30%, and that does sound scary. But what do those numbers really mean? And how would that worst-case scenario impact collections? What should we be concerned about as investors in affordable housing? Damian Bergamaschi is the cofounder of Damris Capital, a money management firm that leverages data analysis to help its investors achieve financial freedom sooner. Damian leads Damris’ optimization research for all investment models and algorithms and serves as the portfolio manager of the firm’s real estate acquisitions. On this episode of Apartment Building Investing, Damian joins me to explain how his obsession with data led to investments in commercial real estate. He discusses why affordable housing has been insulated from COVID-19, breaking down what the unemployment rate really means and how government subsidies have had a positive impact in the space. Listen in as Damian calculates projected collections in a worst-case scenario and find out why he is bullish on affordable housing as a reliable long-term investment. Key Takeaways The Damris Capital origin story Idea to organize data, info from white papers Test different asset classes by numbers How Damian’s research led him to affordable housing Devaluation of dollar = consistent long-term trend Residential real estate most tax efficient way to invest indirectly in inflation Add framework of Inflation Harvesting (layer on debt) What we don’t understand about the unemployment rate Many people have income despite being unemployed (e.g.: retirement, disability, etc.) At 30% unemployment, 60% would still have income vs. 80% in normal circumstances Why affordable housing is insulated from COVID-19 Government safety nets (stimulus checks, unemployment benefits) More likely to pay for housing than discretionary expenses Even in worst-case scenario, 70% collections projected The adverse short-term impact COVID may have on affordable housing Reductions for prepayment Slightly lower collections Credit card processing for online payments Won’t raise rents for 12 to 18 months Damian’s promising long-term outlook for affordable housing Opportunity to raise rents at accelerated rate in 18 to 24 months Consistent supply and demand in residential real estate As cap rates contract, value of properties will expand The cyclical nature of delinquencies and being paid up Most caught up after tax return Most delinquent after holidays Why multifamily investors need to be thinking about September Unemployment will start to hit caps (safety net goes away) Renters may owe on taxes, not realizing UEB taxable Connect with Damian Bergamaschi Damris Capital Resources Join Michael’s Investor Incubator Mentoring Program Register for Deal Maker Live Join the Nighthawk Equity Investor Club Damian’s Blog Post on Unemployment Damian’s Blog Post on Mobile Home Park Investing Damian’s Blog on Mobile Home Park Investing Performance Post-COVID Inflation Harvesting The Case-Shiller Home Price Index US Bureau of Labor Statistics Subprime Auto Loan Delinquency Statistics Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

No one knows exactly what will happen in the multifamily real estate market as the Coronavirus pandemic continues to unfold. But the heavy-hitters who have been in the game for a long time can predict, with relative certainty, which markets will thrive, when we’ll see new deal flow, and what the capital markets will look like over the next 12 months. Michael Becker is a Principal at SPI Advisory and Senior Director of Mortgage Origination at Old Capital Lending. A 15-year veteran of commercial real estate banking, Michael has originated and managed portfolios in all the major asset classes. In the six years since he started investing in multifamily, Michael has acquired 10K units and currently manages a portfolio of 6K doors. He also serves as the Cohost of the Old Capital Podcast. On this episode of Apartment Building Investing, Michael joins me to discuss the post-COVID new normal in multifamily real estate. He explains how the pandemic is impacting his business and offers insight around what the recovery might look like—and what that means for us as multifamily investors. Listen in for Michael’s predictions on multifamily capital markets and deal flow in the next twelve months and learn what you can do to be ready when the market turns! Key Takeaways How Michael’s career has evolved over the last several years From 1K to 10K units in Dallas-Fort Worth and Austin Start in workforce housing then sold old, bought new How Michael was able to scale so quickly Access to capital (JV with HNWI, shift to syndication) Leverage technology for efficiency in raising equity The biggest challenges Michael faced as he built SPI Advisory Raise money + find deals while managing portfolio Stay organized as scale (e.g.: send 1,200 K-1 forms) Why Michael’s uses a third-party property management team Geographically concentrated in certain area No interest in accounting, HR or construction How the pandemic is impacting Michael’s business 5% delinquency on rents (4X normal rate) Leasing only down by 15% Michael’s predictions around the post-COVID recovery Multifamily product used more than ever Rent softening (how much depends on market) Supply will constrict, new construction unlikely Increase rental pool as people lose homes Accelerating economic migration to Sun Belt Michael’s predictions around post-COVID multifamily deal flow Few deals in Q3, trickle in Q4 Steady stream of distressed deals starting in 2021 What the capital markets will look like for the next 12 months No hard money, financial contingencies available Challenging to get Fannie/Freddie loans No bridge loans, personal guarantees required What work Michael is doing on the acquisitions side right now Active participant but don’t expect to buy until Q4 Aware of real-time data, ready when market turns Where Michael sees his company going in the next five years 10K units, continue transition to newer assets Team runs day-to-day so Michael can travel Connect with Michael Becker Old Capital Real Estate Investing Podcast SPI Advisory Resources Join Michael’s Mentoring Program Register for Deal Maker Live Join the Nighthawk Equity Investor Club Michael Becker on ABI EP064 The Real Estate Guys Summit at Sea Ken McElroy Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

Those of us who enjoy success in the real estate business are typically introduced to a model, an investor operating at a scale we never considered, who gives us an idea for what’s possible and a vision for the future. And if we’re smart, we can learn from their mistakes and leverage their knowledge and experience as a springboard, affording us a more direct path to our own financial freedom. Jacob Blackett is the Founder and CEO of Holdfolio, a platform that connects investors with high-yield investments in the real estate industry, and Syndication Pro, a software company that helps syndicators raise capital and manage investors online. Jacob got his start doing fix-and-flips as a 19-year-old sophomore in college, and today, he has placed over $50M into income-producing real estate, building a portfolio of 600+ units (as the lead sponsor) and a network of 3K registered investors. On this episode of Apartment Building Investing, Jacob joins me to explain how an infomercial inspired his interest in real estate and share his journey from fix-and-flips to wholesaling to SFH rentals to multifamily. He walks us through the steps he took to scale his real estate business, describing why it’s beneficial to have an in-house property management team and how the technology he built to raise capital online became Syndication Pro. Listen in to understand how Jacob overcame losing $40K on his first deal and learn how to avoid his mistakes by joint venturing with an experienced team early on! Key Takeaways What attracted Jacob to the real estate space Free fix-and-flip seminar (sophomore in college) Up to $80K for single flip vs. CPA starting salary Jacob’s experience with his first fix-and-flip Picked up deal on MLS with grandma’s capital Didn’t go as planned, ended up losing $40K Why Jacob pivoted from flipping to SFH rentals Very transactional, no tax benefits Growing portfolio = monthly income stream Jacob’s first AHA moment around scaling his business Create partnerships with investors Build portfolio of 150 SFH rentals quickly What inspired Jacob’s transition to multifamily All rentals in one place with staff onsite Banks/lenders prefer multifamily Jacob’s first multifamily deal 46-unit with fire damage at 50% occupancy Leveraged investor network for capital What surprised Jacob most about multifamily Breath of fresh air (power of all in one place) Had to learn a lot about asset management Jacob’s background working in property management Met investor through wholesale deal Managed all his acquisitions within 2 years The benefits of using in-house property management Generates revenue once reach 500+ units Control and consistency in best practices Jacob’s first steps for scaling his real estate business Implement use of Propertyware software Hire talented leasing agent and COO How Jacob scaled his capital raising efforts Crowdfunding sites caught eye early on Built website to raise money online How Jacob bounced back from losing $40K Resolve to fix mistakes Determined to pay grandma back Jacob’s advice to his 19-year-old self JV on first flips to hedge risk Job at multifamily private equity company Jacob’s advice for aspiring multifamily investors Get on experienced team, see where you fit Think creatively, don’t be afraid to take job Connect with Jacob Blackett Syndication Pro Email jacob@syndicationpro.com Resources Join Michael’s Mentoring Program Register for Deal Maker Live Access Michael’s Syndicated Deal Analyzer Enroll in Michael’s Deal Maker Mastermind Download Michael’s Free Report—What’s the Best Investment: The Stock Market or Real Estate? Join the Nighthawk Equity Investor Club Propertyware Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group

Some real estate investments are riskier than others, especially in an economic downturn. Class A multifamily developers, for example, are likely to lose their tenant base in a recession. So, what can developers do to forecast what the world will look like at the end of a build cycle and make decisions accordingly? And what can we ALL learn from this approach that will help us prosper through multiple market cycles?    Scott Choppin is the Founder of Urban Pacific, a real estate development company out of Long Beach, California. With 35-plus years of experience in the business, Scott has led the development of nearly 1,700 units throughout the Western United States. He is also responsible for a recent innovation known as Urban Town House, a middle-income, multigenerational housing product that serves urban families in California. Scott’s work has been featured in Forbes, The Los Angeles Times and Builder Magazine, among many other media publications. On this episode of Apartment Building Investing, Scott joins me to explain how he got his start working for a large development firm, describing the wide range of skills and knowledge he picked up before striking out on his own. He discusses how he leveraged joint venture partnerships in the early days of Urban Pacific, what the company is doing to mitigate risk in a recession, and why he is optimistic about the current circumstances. Listen in for Scott’s insight on transitioning from a W-2 to real estate development and find out what YOU can do to survive and thrive in an economic downturn. Key Takeaways How Scott got into real estate development Family background in industry Work for large firm to learn on job Why Scott chose another firm over the family business No coddling Gain broadest, deepest experience What Scott learned in working for a big developer Fill in broad framework of knowledge Exposure to every aspect of business How Scott transitioned into entrepreneurship Build network of capital contacts Joint venture with other developers The structure of Scott’s early joint venture partnerships Let me manage day-to-day operations of deal Defer to senior partner as guarantor Scott’s advice for shifting out of a salaried position Save 2 to 3 years of monthly income in cash Build developer fees into deal (overhead coverage) The challenges around doing development as a side hustle Best to learn by working in industry Even small, local deal requires daily oversight What kinds of deals Urban Pacific has done Urban infill, residential development From duplex to 453-unit multifamily How Scott thinks about mitigating risk in a recession Watch market signals to avoid oversupply Focus on workforce housing for stable tenant base Why Scott is optimistic about the current circumstances Accelerated leasing velocity + rents holding Lower costs for construction and land Greater availability of labor from shutdown Connect with Scott Choppin Urban Pacific Scott on LinkedIn Resources Join Michael’s Mentoring Program Register for Deal Maker Live Download Michael’s Free Report—What’s the Best Investment: The Stock Market or Real Estate? Join the Nighthawk Equity Investor Club ‘6 Ways to Build a Career in the Real Estate Development Business’ by Scott Choppin Podcast Show Notes Michael’s Website Michael on Facebook Michael on Instagram Michael on YouTube Apartment Investor Network Facebook Group