Deals & Dollars: Real Estate Investors and Entrepreneurs
Welcome to the Deals & Dollars Podcast, hosted by David Choi, Eric Panecki, and John Libretti, three real estate executives from the New York City metro area. Every week, they bring on the best real estate investors and entrepreneurs they know to learn about how they got started, how they source their deals, and -- most importantly-- how they make their dollars.
If you're interested in being on the show or want to receive exclusive invites to our networking events, you can reach out at (http://www.dealsndollars.com)
Deals & Dollars: Real Estate Investors and Entrepreneurs
Building a Billion-Dollar Empire by 30 Years Old w/ Allon Avgi
On today’s show we have another repeat guest and dear friend of the hosts: CEO and real estate investor Allon Avgi.
What does it take to build a billion dollar empire? Our guest today, Allon Avgi, isn't just dreaming about it, he's actively working towards it. With his ambitious goal of hitting a billion dollars in holdings before he turns 30, Allon is an inspiring testament to dreaming big and working hard. Allon shares his journey over the last 20 years, his successful real estate business, and the incredible New Year’s eve bash he hosted, you might just find yourself inspired to dream a little bigger.
Allon's success isn't by sheer luck, it's a result of calculated decisions and a knack for finding opportunities where others don't. He has honed his ability to identify distressed assets, turn them into profitable investments, and make a killing in markets like Arkansas and Houston, Texas. But the road to riches hasn’t always been smooth. Listen as Allon opens up about his past chasing shiny objects, and how this journey has shaped him into the successful real estate investor he is today.
Yet, Allon's vision goes beyond just making money. He's using his success to create jobs, opportunities, and transform communities. As we chat about his approach to real estate investing, it's clear that his aversion to taking on too many deals in one market is a key part of his strategy.
So tune in, as Allon gives us a masterclass in real estate investing, shares his strategies for building a billion-dollar empire, and provides invaluable insights on risk-taking, investing in infrastructure, and the importance of staying focused on your goals. Allon's story is proof that with the right mindset, ambition, and a little bit of risk-taking, truly remarkable things can happen.
Join the Deals & Dollars community today. If you're interested in becoming a guest on the show or receiving exclusive invites to our networking events, sign up on our official website.
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three, two, one, all right, all right. Today we have a repeat guest. A lot of G. Along let me just say you threw the craziest New year's new year's Eve banger that I've ever been to my entire life. I love that was well, i was sweating all over the place on that dance floor. man, it was a great time.
Speaker 3:I was so happy you guys came. I mean, people were running over there like there's a bus and there's all these people coming out. We took the bus.
Speaker 5:Yeah, I got about that.
Speaker 3:I'm like there from a place far away Called Jersey, and everyone ran over to the gas, you know, and they're like pump around gas while we can.
Speaker 5:Best person, best person I met there was, it was your mom. She's the best, oh my god. Well you, sweet art that night inspired me.
Speaker 1:I saw what like I saw what you were able to buy for your family, the house that you had and just the life that you, you built for yourself. And I was like man, i got to be able to do this for my parents one day. So congratulations to all your success, man Cheers.
Speaker 3:Thanks, man. We did that together. That was an awesome like end result of 20 years in the same place to move on to somewhere great like that. And that's my parents house. They live there. I don't live there, i live in. I live a couple minutes away from there.
Speaker 1:Nice, nice. Great backyard, great pool, really beautiful house. And I did have to spank some people up in ping-pong. But I mean, do John still?
Speaker 5:owes me money for that, for that very hustled me. No, I told you, i was good. He's like oh, you're not that good. I'm like I'm pretty good. I'm pretty good, is that ping-pong?
Speaker 2:table here.
Speaker 1:I'm the best here. Let that be known.
Speaker 5:I'm good, we have a better than me, but I'm pretty good.
Speaker 1:Oh, shut up, shut up, that's racist quite frankly, Yeah, sorry you're raising your race against the rest, Yeah you're right, i do have a competitive advantage in a couple things Now and ping-pong.
Speaker 5:I was gonna say excel, but yeah, I want to play ping-pong.
Speaker 1:You're good.
Speaker 3:I'm okay, someone's.
Speaker 2:You have pink, you know you're good, you have ping-pong lights at your house Wednesday nights. I.
Speaker 3:Used to every Thursday and, believe it or not, it became too big, so I had to slow it down. So I thought 40 investors over just ripping ping-pong.
Speaker 2:That's actually awesome.
Speaker 3:It was so cool.
Speaker 2:I made a couple trips out to right did Jay Silverman doing great with me. Are. You guys are in on a deal together. Yeah is this a Jersey City one or?
Speaker 3:Long Island.
Speaker 2:Okay, wow, it's great.
Speaker 1:So a lot for the guests that have not watched the first podcast you coming on. Can you just kind of give the audience a little catch up on who you are?
Speaker 3:for sure I am a lot of key King of Narnia. No, i'm kidding. I buy real estate all over the country, primarily Long Island. I started my company six years ago with a hard money loan and it's now spurred into some beautiful acquisition real estate development company. I primarily distressed and opportunistic assets repositioning very quickly. I raised money through syndications, joint ventures and at this point, a lot of my own money as well and And slowly transitioning more into that direction. You know, because we do really good deals. So I try and keep as much equity as possible And when I raise it makes it kind of easy because people are like, why don't you buy it yourself? I'm like I would if I could. I Can't buy everyone by myself. You know I've got eight deals under contract now, with another six coming up. Actually, i signed three more contracts between Friday to Monday, so I'm going to be at 11 and another four to five coming up.
Speaker 2:I'll be at like 16 properties under contract from 600,000 to $15 million per deal which is the triple net, that the biggest one is the triple net one that I'm dropping for you.
Speaker 3:It's the yeah, it's what. It's the second biggest one.
Speaker 2:What's the boat? What's the one bigger than that?
Speaker 3:It's a 15 million dollar industrial building.
Speaker 5:Nice, oh nice. One thing that I love about you is is your goal. You gotta tell everybody your goal.
Speaker 3:So my goal is to hit a billion dollars in holdings by the time I hit 30 years old, which is about three years away, and I Love you too, eric. Listen, I'm gonna stop it there. What thing I love about you? No, no, you made eye contact, No it's, it's When.
Speaker 5:When I see that and I'm just so sure you're gonna hit it and it just makes me happy inside, i'm like this guy's, he's, he knows what he wants and he's he's going after it and I think, having such a clear target, i think it's so powerful right. Just knowing this is what I got to get to and just working your way backwards. I see you working every day towards that goal and it's just awesome to see bro.
Speaker 3:I'm so happy you said that and I appreciate that a Lot. It's so funny how the journey's changed over the years. You know, in the beginning I was like sell nothing and that got me to a hundred million. And now I'm like, okay, i need to start selling so I could go bigger. Well, and while these times are upon us, you know, because now it's a very opportunistic time The last couple years was a very low interest time We have somebody in this room that put out a lot of debt. I'm not gonna drop names or anything, but he made a ton of money, spent a lot of it at sexy fish in Miami, kiki's on the river too, so I've heard, but those days are kind of done. Hopefully he's gonna make a lot of money, but it's a different interest rate environment and because of that There's a lot more opportunity, which I'm clearly taking advantage of. Think I positioned myself extremely well not knowingly Extremely well and and now is my time to rip and hit that billion dollar goal I noticed that you were like asset class agnostic and marketing.
Speaker 1:Not I mean, most year holdings are in, are in Long Island, but overall you're you're pretty open to taking down deals nationwide and different asset. Like I, i've always had a trouble. I mean, whenever I get an industrial deal, i don't know what the heck I'm looking at. Right, i see a self storage deal. I know how to underwrite it, so maybe I'll take a look right, that's why we're doing a storage deal right now. But it just blows me away that you're able to do this like what's what's the secret sauce?
Speaker 3:Well, let me just clear up two things. You can underwrite anything, mr Troy, i'm very smart man.
Speaker 1:You're right, you're right, i could.
Speaker 3:That's number one That was really important to get out there. Number two is I'm not necessarily market agnostic and or and or asset agnostic. In Long Island I'm asset class agnostic. In Long Island I'm market agnostic because I know the whole island inside and out. My infrastructure touches the entire island. Market-wise, i'm hyper focused on Texas, on Houston, texas and in the North Little Rock region of Arkansas, strictly multifamily. So in Long Island, asset class agnostic, market agnostic throughout the island, in the boroughs, going into a different market. So I hyper focus on two.
Speaker 3:I've been in 11, and I've scaled back from those 11 to New York, houston, little Rock, arkansas. That's it. I wish I could be market agnostic with one asset class being multifamily, but I can't because it's very difficult to grasp that right now. So over time I will get there, probably on some sort of co-GP structure. The problem is that it's extremely difficult to build a huge holdings company being asset class agnostic. And this comes with age and experience. You know, when you're younger you're like I want this, i want that, i want this, i want that, Just like John Labretti in Miami. And then as the age starts to hit you and the experience, forget the age. The experience starts to hit you and you say, wow, i need to slow down. You know, i need to stop being so childish. I want everything that I can see and I need to focus, because that's what's going to get me much bigger, much faster. Economies of scale are really everything.
Speaker 5:I love that word focus. I think Dave could probably speak on focus right now for us. But it's the same thing. It's when you're young in business, especially when you have like a little bit of success, right, you're like I can do anything. Right, like I'll do Amazon stores and I'm going to buy industrial and strip malls and self storage and buy stuff in Alaska, and it's all going to be great. And then you realize, after having your teeth kicked in a couple of times, you're like all right, let me find out what I'm really good at, right. So I'm curious. It seems like you know obviously you've had success in multifamily. Why those two markets, specifically after being in a few?
Speaker 3:Well, i've been in the 11 markets I told you about. I've just found a lot more success over there. Okay, you know, arkansas is very easy to manage. I've found So easy to manage. It's unbelievable when you have the right infrastructure and people right And I think I have those people and that infrastructure over there.
Speaker 3:Houston, texas I'm buying at the right basis because we know the demographic really well, we know the area as well. I've got the management down. There was a huge learning curve to get there, massive learning curve and a lot of mistakes made along the way that I'm getting myself out of right now, as you know. So that's why those two markets Long Island, i mean I am the most I would say I'm top three most active players in Long Island right now in the middle market space. So I love that market. I know what inside and out, very easy to lease up, very good basis on the properties we find very competitive.
Speaker 3:But the other markets I was in like St Louis, detroit, binghamton, a couple other places, memphis I've been pulling out of One the landlord laws aren't so friendly in Detroit and St Louis. Two, i'm not in like the upper echelon people over there. I didn't cement myself over there and I don't have the economies of scale, nor do I think I want to. Maybe I'd revisit St Louis. But Detroit, i think, is like shiny object syndrome, you know, you're like cheap houses, high rent not really, you know there's a lot of work that goes into it.
Speaker 3:You're dealing with tough people that are used to a certain way of life. once that crisis happened and all the cars, like all the car manufacturers, left, they're used to a certain style of life. Actually, in Detroit, if you drive through the streets, have you guys been there? Yeah, so you've been there.
Speaker 5:I've never been You drive through the streets.
Speaker 3:What? Eight mile Everybody from the three.
Speaker 1:One, three put your fucking hands up and follow me. Come on eight mile.
Speaker 3:Isn't it crazy, detroit, when you go there, you're driving through the streets in these rougher areas where people are picking up houses left and right like section eight kingdom, they call it right People burn down the houses for the insurance money. I'm talking like 30 grand. The materials cost about five times more than they're getting from insurance And they're just burning down streets. They burn down streets to get insurance money. I mean it poses opportunity. just how heavy of a lift do you wanna carry? I know you like to work out, but how heavy of a lift do you wanna carry in order to make a certain amount of money in a certain amount of time? Right.
Speaker 5:Right, that's okay. So, and then I mean so Long Island, you'll go anywhere. And then you just built some economies of scale, I guess, in these other markets. And then obviously landlord tenant laws are better. Was it market conditions as well? Was that playing to it?
Speaker 3:Arkansas's market conditions are like plateaued. They like don't exist. You know it's like this is us. You wanna go duck hunting Or you wanna go to church. Right. You know, it's like a very finite amount of things to do there. And great people. Wow, do I like the people over there? I mean, they're amazing.
Speaker 2:Like nicer, like what specifically about them?
Speaker 3:Salt of the earth. Like good, good people, Their word is honest. You know, Arkansas, Arkansas, they'll shake hands. I hope you go over there. Yeah, seriously.
Speaker 1:Dude, i've been staying in Arkansas. I think I heard you were going to Arkansas And I heard one of my mentors say Arkansas And I said we're going to Arkansas. That was another shiny object syndrome that I've pulled back from, but I've heard it's a fantastic real estate market. Look great current yield.
Speaker 3:Yeah, you just need to know your business. You know like shiny object syndrome. You go to Arkansas, you're finding units for 30 grand a pop. You don't buy those units.
Speaker 3:You know, you stay far away from those units. You don't want those 60s, 70s, 80s vintage product because 2,000 vintage is getting the same rent as those as that vintage And your, you know your OPEX is so much higher in the 70s and 80s vintage. I bought 2014 product at 70 K a door. It was a home run deal value add like 10 and a half cap in Arkansas Full cash out refi with Arbor sub one year. Nice You know Pulled out all your equity.
Speaker 3:Yeah, we're in the middle of it right now. That's a 67-unit property Wow, barely any maintenance, barely any headaches. So 2014? Yeah, 2014, vintage Wow, nice, yep. So I'm looking more like 80s plus 2000 year. You know, 100 K a door range And you show that to people that are new in the business or they're New Yorkers and they're like why would I go there to pay 100 K a door? It's like whoa, you know. First off, they're not reassessing your taxes. Second off, your management's extremely easy. Everyone's paying you. There are no such thing as evictions. I didn't evict anybody. I have hundreds of units over there. If I have a problem or I push rent, they just get up and leave. So you need to know your business.
Speaker 3:And I just basically explained it all. So you're welcome. I hope you guys all make a lot of money.
Speaker 2:Wow, You have that credit unit out there that you work well with too. You only do. let's retake all your perms off too.
Speaker 3:So it's funny the way the local banks over there work. It's like you need a relationship, you need to be in with a current existing customer. So that's why I didn't want to even release that. I wanted Mr Troy over here to go there and be like get me debt, and then they'd be like sorry, sir, you have to partner with somebody that knows Arkansas.
Speaker 1:No, it's because I'm Asian, let that be known. I would have to have Eric go down there.
Speaker 5:Still good at Excel though.
Speaker 3:Dude, eric wrote the way he's dressed up and everything they'll be like. you're not from around here. No, no, no, i can blend. I can blend No.
Speaker 1:Eric could pull it off.
Speaker 5:I grew up in the sticks.
Speaker 3:Did you Yeah, in Jersey.
Speaker 5:In Jersey And honestly this might be revealing a little too much, but Arkansas for me is like a dirty word. Growing up, my mom, when I was in college, moved to Arkansas with her boyfriend And so when you come home from college and you go hang out with your friends, everybody stays. I had nowhere to go So I would stay with my friends And the ongoing joke was like oh well, my mom's in Arkansas doing I don't know where she is, but so I always just used to make fun of Arkansas. And then every time Dave says Arkansas, like yeah, yeah, yeah, okay, arkansas 10 caps, bro.
Speaker 1:10 caps, Look like I want to bring a little bit of focus on that billion dollar mark. You have a. You have a three year North Star right Where you're going to go and you're putting all your resources and times to get to that goal. I recently had that revelation, Bro. Since I started in business about five years ago, That's it, Yeah.
Speaker 3:About five years Come a long way. In five years, four and a half.
Speaker 1:Yeah, i'm not happy with where we are. That's what it's very, very, very upset. What did you do before? I worked in private equity real estate just underwriting deals. You know, true to my nature.
Speaker 1:I'm just like I honestly, I hated it, or just good at it. It's just like something that you hate to do what you're great at, So you can't get away from it. But I, I I had this revelation that over the last five years The first, the first year of business where you know I was I was brokering hard money loans, Right, That's how I met Eric. I was doing short sales, I was taking listings, I was wholesaling properties, I was looking at fixed and flips and buying holds And I said, Oh my God, I need a focus. And then I went into wholesales and lending And I was like it was. It was a little bit more focused and the business grew like a thousand percent that year, Right. And then we started making some real money and I was like, Oh, everything that turns the gold player. So I was like I'm set, I'm good. So now I'm like I'm this like 20. I'm like I'm like 25.
Speaker 3:What'd you make?
Speaker 1:like a million dollars, Yeah like like a million, like a little over a million dollars a year, and like they were here like two million dollars in revenue or something like that, and I was like, oh, we made it. And, like you know, i'm filled with testosterone. I still haven't hit past 25. Right, and I'm like I'm going on three dates Friday, friday, saturday. I had I had a booked up bro. It's like morning, afternoon, night.
Speaker 5:Dude, dude, one time we're at we're at a dinner, dave has like we're at a dinner, it's all of our boys. I'm like. I'm like I'm going to go, I got to leave, i got a date. I'm like, what are you leaving for, bro? And he gets up and leaves and we're like. We're like, why are you leaving? He goes, you just mad because I'm winning, and pops his collar and walks out with the chain out And I was like I've never hated this guy more in my life.
Speaker 1:So anyway, all right. So that was another shiny object syndrome, right? And then COVID hits. I'm buying Amazon stores. I'm like I'm dumping, like 200 K to Amazon.
Speaker 3:And to reference Yeah, Yeah. And then I said I like it this more Yeah.
Speaker 1:I put jumping 200 K to Amazon stores. I'm like, bro, i'll make it like 30% cash on cash returns a month. You won't beat it, did you? It was like more like 15, but until the store shut down and I lost a good chunk of money. And then, uh, and then I'm like, oh man, i'm bored of of of my current business, let me go flip some cars. So I start a car. I did click a free car dealership. I'm going to start a car dealership flipping, flipping a car week. And I'm like, did I touch turns to gold Right? And I ended up buying a two expensive cars because I wanted to scale up and do some bigger deals. I ended up losing everything I made on those two deals No.
Speaker 1:Then I'm like oh, we, we got to get like bro.
Speaker 1:And then it went to fund the funds, and then it went to uh stereo funds is within the scope of your business Within the scope right, but um it was, it was like next level, like it was more private equity, managing capital and deploying into LP positions, and um, and then I went out and I got a commitment for $2 million of VC to start another company And, like all throughout this process, i'm I'm like doing stuff that's not making me cash today, but it's still making cash today, just not where I could be. And so, um long story, i know I'm long winded here, my apologies, it's all right, i go to CG.
Speaker 1:Let it out. This is like a therapy session for me. I really, I really get to let it all out.
Speaker 5:We should. This is the podcast of David Joy.
Speaker 1:Yeah.
Speaker 5:The deals and the great podcast. I love it.
Speaker 3:I actually love your guys podcast. Wait, keep going, please.
Speaker 1:Okay, okay. So I'm, i'm, i'm doing all this and I go to collective genius this quarter and I talked to the owner of collective genius and like kind of, the theme of this podcast was the tortoise versus the hare. Right, the tortoise takes his time, gets his and he's consistent. He's doing the same thing. He's taking a step forward. The hare is ripping off and taking a pee. He's going on a little vacations. He's doing this down the fourth getting distracted. You're the hare.
Speaker 1:And I realized Jason pulled me aside. He goes you're a hare, you're the hare And he's like you got to focus. He goes, david, like how difficult would it be for you to make a million dollars a month in your active income business, just wholesaling, flipping properties? right, i said not that hard, like 20 deals a year. I could probably get that done like a year, year and a half, if I focus.
Speaker 3:Walk in, that's all I do 20 deals a year to make a million 20 dollars a month which is relatively easy, right, and there's guys in my space doing that my age right now. How many are you doing now?
Speaker 1:We're doing like six to seven right now. We dropped from like 10 to 15 and you know a market slowed down. I wasn't involved because I'm so busy raising money for deals.
Speaker 3:How many deals have you guys done?
Speaker 1:A lot Like hundreds.
Speaker 5:No buy In words of buy.
Speaker 3:Yeah, that you've raised money for.
Speaker 5:That we've raised money for.
Speaker 1:Oh, not many. We've done like four, five syndications. We bought about like 29 properties but separate properties, but we self-funded everything from the wholesale company, right.
Speaker 5:So we have a cash business, basically, and then we have, like, the investment side of things And what we've, what we started to find, was that, you know, as we focus more on our investments, that the cash business wasn't making generating nearly as much cash. So we're focusing on raising money for our deals And then we're making less cash, but it's like if we just focus on raising cash, we wouldn't even have to raise money. You know what I'm saying?
Speaker 1:7.3 million dollars we're raising right now And it's like, well, if I just focus for the last five years, I'd be buying this with my own cash.
Speaker 3:What are you guys buying?
Speaker 1:A 79 unit in Austin, New York.
Speaker 3:Got it Yeah, the one you told me about earlier.
Speaker 1:So it's like It's a lot of money to deploy.
Speaker 3:Yeah, it is For 79 units and where It's where we're going now We're buying a 55% loan to cost. Got it.
Speaker 1:It's very low leverage, it's cash for long day one And the rents are 25% below market rent, so it Who's doing your debt? Fanny Mike. I'm sorry, john, we went. We ended up going. Walker Dunlop.
Speaker 2:Yeah, i know, i know this it's not okay Sitting right there.
Speaker 5:No, no, there's a reason behind this story.
Speaker 3:It's John hit him.
Speaker 1:No, no, we would we would have to go back to Johnny probably could have saved us a couple basis points on the on interest in the points, but The guys who brought us a deal already had it lined up with Walker Dunlop, so we just Took.
Speaker 5:I'm gonna get. I'm gonna get you on back on track. So you're saying all this stuff, we've done a million things, not focus You really like his is his goal when you say hey, dude, ever since I've met you, you've been saying billion dollars.
Speaker 1:I'm getting to the billion dollar mark and it's like I'm sure that's why Eric was like wow, i really love that about you. Can can you talk about, like, how you're staying so locked in and how you like the things You've had to say no to to stay focused?
Speaker 3:Yeah well, it's like a switch. You know, i went through that ride that you just had when I was a little bit younger.
Speaker 3:You know, so that switch was all that needed to happen. Where it's like, all right, i need to focus, you know, mind you, i still get to do fun things, but I've learned my lesson that it can't all be mine, right, you know. So, like I'm opening, i'm opening a couple businesses. I am literally zero involvement. If somebody even comes to me and says, alone, what about this? I'm like don't, don't, even, i don't have an opinion. Forget about alone. He doesn't exist. He's good for one thing It's money And buildings. That's it. I love that. So I don't want to get distracted at all, hyper-focused while getting to do those other things. You know, it's like that deal I just told you about the big one. It's I have to buy, it's a whatever. It's 15 million all in. I have to buy a business with the building. I have somebody that'll buy the business once at the closing to buy it from me. Maybe we'll go in partners on the business, but he's the operator, nothing to do with me. Instead of looking and saying, okay, this business will make me a million dollars a year, it'll make me half a million a year and he can have it. Yeah, exactly, i don't want any part of it because I need to focus on my goal also.
Speaker 3:You realize it's all steps. You know like I talk about this all the time. It's stepping stones, stepping blocks, escalator, elevator. It's like four levels. I'm right now on the stepping blocks point of my career. I'm past the stepping stones. I've been through the journeys, through the rocks, through the blood, sweat and tears. Now I'm on the stepping blocks, at bigger steps. I love that. I can do 15 million dollar deals. I have people that'll cut me checks on a phone call. You know I want to get to the escalator next, where I'm consistently doing 20 to 50 million dollar deals.
Speaker 3:That's the escalator of our business. Once I hit the elevator, it's like you're doing whatever deal size you want, whenever you want on one, you know, sign of a check And it's very easy going. You have the whole infrastructure. You have the workflow, soup to nuts. You don't have to worry about anything. You just have to say yes or no. Right, so that's the elevator side of the business. Send it up and down, you get. You know, you bring people up with you through co-gp'ing, through debt, through title, through everything that builds your reputation. Well, that sustains your reputation. You build it on the stepping stones, blocks and escalator point of your career.
Speaker 3:I like that so, and now every business has that yep. So you just have to get there. Like Brad is on the escalator part of his business, i Brad is not on the elevator yet.
Speaker 2:That's not yet. I agree with that.
Speaker 3:There's people at Arbor doing, you know, five to ten billion. Yeah, they're on the elevator. Yep you know Brad is doing whatever one to two billion a year. He's on the escalator, he's getting up there, but if he lost focus he would still be on stepping blocks, you know. So it sounds like you're repositioning your focus back to your roots and I think, i think everybody, i Think everybody.
Speaker 5:Every successful entrepreneur I know at some point has struggled with the focus, the shiny object syndrome, of course. Do you feel like that?
Speaker 1:Yes, yes, it's, it's just, it gets boring sometimes.
Speaker 3:It does, it does. But then you go bigger, you know, and you want to be a whale. I wear whale socks.
Speaker 5:Where those humpback are. Those humpback whale, these are whales. Are those humpback against?
Speaker 3:the whales, eric, what? what kind of whale is that? South Korean whales, oh.
Speaker 5:I bet you they're good at sure I bet you they're good at Excel. So these whales?
Speaker 1:I.
Speaker 3:Want to be a whale, so much so I wear whale socks. I love that. That's awesome, you know, and it's You learn very quickly. When yourself made right, when you come from the bottom, when you get it given to you, it's like so much easier to make these mistakes and whatever. But that deep desire, that endless feeling of not being enough, you know, not doing enough, i feel like that one can't be taught.
Speaker 5:You know, that's just within so you, you, by your analogy, you're, you're on the escalator right now. No, i'm on the stepping blocks, stepping blocks.
Speaker 3:Yeah, okay.
Speaker 5:And what? what is the hurdle impeding you from getting to the, the escalator, the next step or what's gonna get you Oh yeah, what's the?
Speaker 3:what's the? yeah. I think I need a better infrastructure and I need a better business model, and by business model I'm bringing us back to the beginning of our podcast by becoming more focused on my asset classes and markets. Hmm, and that's a challenge. Yeah you know, because now the shiny object syndrome is like oh My god, you know, 500 units in.
Speaker 3:Houston you know, like in the sub market of Houston, like I want that, yeah, but it's like I can't take that down. You know, i got to keep focusing on the 10 to 15 millions in the heart of Houston, the areas We know, the areas we can manage, you know, or Arkansas, or New York, but even that I need to scale down. You say, alright, i'm just in, you know this place and I'm going to be the best here, like a laser like you're.
Speaker 5:You're going from a basically like a spotlight to a laser focus.
Speaker 3:Exactly, and that's such a challenge. So I think that's what's going to get me closer to the elevator. I cut out eight markets in the last year, stick with it.
Speaker 4:I just want to take a questa, so I mean that realistic.
Speaker 5:Look at how you worked so many. So I mean, that's a conversation with your team.
Speaker 3:Right, like, well, i got my second. The Bronx. Yeah, right, and we do deals in Brooklyn and the Bronx is very close, the Brooklyn, manhattan, everything, and I don't want to go there because I don't know it, yep, and they're like, but it's a great deal. We know the fundamentals, everything, the contract. I don't want to wholesale the contract. That's not getting us to a billion dollars oh man, this is music to my ears it's like, it's like.
Speaker 2:I've never seen you put up like that because you know what.
Speaker 1:It just means a lot to me. Right now, in my phase of life, i've realized that I'm addicted to chaos me too.
Speaker 5:No, he's so right, me too, me too, i hate I hate whenever, when everything's going perfectly, it's I'm like what, what is going on? I'm like what can I break?
Speaker 1:right now I honestly I'll tell you. I'll tell you not my stories, i'm sorry, the David Troy podcast, this is ridiculous, but I'll tell you story this morning. This morning I'm like focused and I'm like this feels kind of good. I could just lock in million dollars month. I'm to me Eric's texting me pictures of books, like pages of books Marina read about.
Speaker 5:Like focus, it's a book 10x is easier in 2x. It's not actually Grant Cardone, i forget the author, but it's it's. It's an amazing. I mean, i read a lot of books. This one's been pretty.
Speaker 1:I open this one up it's.
Speaker 5:It's, you know it's. It's basically about the goal. Like having a goal, right, you could have it, a goal of a hundred million dollars worth of real estate. You could have a goal of a billion dollars worth of real estate and then the idea is, with a hundred million, if your goals a hundred million dollars worth of real estate, there's a lot of ways you could probably do that right. You could buy a bunch of single families in Detroit. You could do. You know there's a lot of things you could do, but if you're gonna do a billion, there's really not that many things you could do.
Speaker 5:You could probably do like three or four things exactly that take you to that level so it's and it makes you think about, okay, where the highest leverage, not to use the word activities that I can do with my time.
Speaker 3:I'm so glad you put that in the word. So I want to keep building on what we're talking about, the hyper-focusing. So now I'm not pulling out of those two markets, but instead of doing the 10 to 60 unit deals that I'm doing, i solely want 200 units plus. If I'm going to devote resources to Arkansas or Houston, i want 200 units plus per deal because those are slugs. Right, 15 to 40 million, i want slugs, i want something to impact it. Otherwise let's keep focusing on our best and highest use market of Long Island, nice. So now, remember, i said I have 16, i've almost 17 deals under contract and total coming up 11. As of tomorrow, another five in the pipeline, every single ones in Long Island wow, amazing what's the?
Speaker 2:total? what's the total dollar? and I'll follow you on those roughly 50 million nice John's like money, money, money.
Speaker 1:And I have a hundred million dollar portfolios.
Speaker 3:I'm about to increase it by 50% on that one change that I made focused two months ago that's amazing.
Speaker 5:That's I love that.
Speaker 3:That's awesome yeah, but you learn by trying. You guys know that you learn by trying things. So I'm like all right, guys, we're not getting to the billion at this rate. We're gonna have to grow. You know, 300% year over year. It's not happening because we're gonna hit our ceiling with capital. Infrastructure won't be able to keep up. You could be as optimistic as you want. I'm being realistic right now because it's my goal, right, and we all have to get there together and we'll all be very wealthy doing it. But I care about this goal. I don't really care about the money at all. You know I have enough money. And now I'm very humble guy. You guys know me. Yes, like I drive the same car for the last whatever seven years. I don't wear any jewelry. No, i know you guys love your watches. I just never got into it, you know, and I don't have anything against it. I love that stuff. I really want that stuff one day, you know. But I'm like first a billion, you know, first a billion. That's the objective.
Speaker 5:Everything else comes second you know they call that a North Star. That's what it. That's what it's called them. Or, yeah, a lot of consultants call having a North Star, that's where, that's where we're headed, and then having that, and then everybody on your team knowing that's where we're headed, and if it doesn't bring us closer to that North Star, then then there's no point in doing it. Yeah, yeah, and that's. You've had a really good one, which is awesome.
Speaker 1:Yeah, billion dollars.
Speaker 3:So much so that I didn't sell anything, guys, in years. I didn't sell anything in like three to four years. I only sold to get so we could get that house for my parents in 1031 to a big project. Now all my headaches I want gone So my infrastructure could handle the bigger deal flow.
Speaker 2:Like all your single families are starting to sell Yep.
Speaker 3:I have a lot of single families.
Speaker 2:I remember all the ones we did with JLJ Capital, but they're holding you back.
Speaker 5:They're holding you back from Exactly.
Speaker 3:I got it Because we can only handle so much And I want to be bulletproof. You know, I don't want people to miss anything. I'll keep hiring, You know. But that doesn't mean you're bulletproof. A lot of people doesn't mean that you're bulletproof Or that you're growing or that you're a big company. It means that you have more overhead.
Speaker 1:Yeah, that sounds about right.
Speaker 3:You know so Slim Operation. I learned this from Snapchat doing a case study on Snapchat. I did this for fun. Snapchat had 50 employees when they were doing a billion dollars a year 50. I have 25 employees. I'm doing what? 10 million a year. Yeah. That's sick. See what I mean. Yeah, you want to be like one of those giants. Yeah, we're like Berkshire 29 people in the back office, half a trillion under management.
Speaker 1:It's quality over quantity right. I just had Rob Beardsley from Lone Star here. $400 million in the 80s. This guy is a beast. Seven employees, i mean he has a property management arm that he doesn't really I don't think he deals with, but internally seven people when he's. I think over the course of the last like.
Speaker 3:Yeah, that's hard, that's really tough I mean these are savages too.
Speaker 5:I mean it doesn't include, i think, like anything to do with property management or you know, supers or anything you know maintenance guys is not included in that number, but like it's internally in his team Got it.
Speaker 3:So you know investor relations acquisitions.
Speaker 5:You know that.
Speaker 3:So I have like 10. Yeah, if I counted it that way.
Speaker 1:That's a lean team, yeah, but not really.
Speaker 3:He has seven with $400 million. That's ridiculous.
Speaker 5:I have 10 with $100 million, but he doesn't have single families to tell you that much. Yeah, yeah.
Speaker 3:And then you see you learn from other people. I think the best way to learn is from other people's mistakes. And you look at these other guys and girls and it's like, all right, they just took down a $300 million deal. It's like you know, they took down four of those in two years. They're at 1.2. Right. I've taken down 50 deals. You know it's like what am I doing here?
Speaker 1:No, it's true, man.
Speaker 3:Listen. there's fundamentals, though, to everything, and there's the ups and the downs. You got to keep in mind that there's problems with that too. The problems are that a million dollar problem, you can handle, you can handle, you can handle, i can handle. a $300 million problem, you don't know You're wiped out.
Speaker 1:You're wiped out. Yeah, there's a guy, brian Adams from CG. He does one deal if that a year, but he's doing $200 million deals. He's spending all his time He just looks at deals and underwrites, makes offers And then when he takes it down, he's flipping it and making like $15 million profit for himself. Wow, It's like the guy went from a CPA accountant to three years later buying $100 million deals. It's like it just goes to show like if you're focused on just one thing dude, i had this this kid call me. He's like ask, like he's having like career issues. He wants some guidance. I was talking like 30 minutes ago.
Speaker 3:Also.
Speaker 1:Korean. Um no, he's. I think he's Portuguese And you helped him. Oh yeah.
Speaker 3:I'm, uh, I'm, I'm race.
Speaker 1:I'm race agnostic And he's like Dave. Like I wanted to develop and I want to do multi family syndications. I, you know, i'm a loan officer. Right now I'm a buyer's agent. I'm a go, he goes. I'm thinking about going back to school, i go. Oh my God, you remind me of some like a a me going all over the place And the kid's successful. He's 22 years old, he's got a hundred a hundred nine thousand dollars. You saved the party.
Speaker 3:That's awesome.
Speaker 1:That's very impressive. Right, he's on a track to make six figures.
Speaker 3:More than nine now.
Speaker 1:Like crack hard down, right, you guys spend it when you get it. Um, but the kid I was just like dude. Everything I've learned I just want to give it to you. Don't make the same same mistake as me. Just do one thing and spend all your time on it for the next three to five years. Give it everything you got And I promise you you're going to come back to me and be like Troy I'm making $2 million a year. I'm making $3 million profit a year And then take that money my friend Joseph, you're listening to this then go buy real estate, right. Then go figure out. If you want to start another business, go for it. But while you're getting your journey started, just do one thing. You can't express that enough.
Speaker 3:I bet LaBretti has probably seen more of these success examples than any of us in his career.
Speaker 2:What in terms of like, like?
Speaker 5:you're probably the guys that are most successful.
Speaker 2:Yeah.
Speaker 5:Stuck with one thing, I'm sure Oh, a hundred percent.
Speaker 2:I mean, when we, you know I started working together, i think the first loan I did for you was like 650,000. Wow, and you had at that time. that was what three, two and a half, three years ago. Yeah. I mean, we didn't have anywhere near a hundred billion.
Speaker 3:No, I think I had 10 million.
Speaker 2:Yeah That, we did it with JLJ capital. That was when rates were like fucking 3.75%.
Speaker 5:I think that was four and a half percent for a DSCR loan.
Speaker 3:Like a DSCR loan. It was a four and a half percent five year I owe loan with 25 years P and I after that.
Speaker 1:Yeah, and this guy is more Asian than me. He got that thing locked in bro.
Speaker 5:Yeah, that was a 30 year deal. I remember getting us a four. Oh rate, i'm a DSCR loan. I think it was interest only and they've they've yelling at me because of the.
Speaker 2:Oh, that's probably yelling for four.
Speaker 5:That's crazy. I'm like we. We look at it's like at the best interest rate in their entire portfolio.
Speaker 2:That's probably the lowest Yeah.
Speaker 5:I think we actually have like a three, seven, five, somewhere.
Speaker 2:But I think we sold that one.
Speaker 5:Did we, they had a Tampa deal. Oh, that was the three.
Speaker 1:Yeah, that's the one that Eric negotiated so hard with the lender that they literally lost money when they securitized it and they were like we're not, we're not working with you guys anymore.
Speaker 5:Wow, it was done. It was done. That's hilarious.
Speaker 2:That's crazy, though, like going back to where you were just saying. Like looking back, you know, because when I started my team at progress, brad gave me two clients. It was family from Brooklyn and it was you, yeah. And then, year and a half later, we're doing like six, seven, 10, 12 million dollar deals and Brad's like I'm like no, no, stay over there, You got enough.
Speaker 5:Dude, brad, put you on to us. Yeah, really.
Speaker 2:Yeah, i was like what, back in, like end of 2021.
Speaker 3:I've given you before COVID, i think I've given you seven million dollar referrals.
Speaker 2:Yeah, you did Mount Pleasant, Ave and Newark. That one I closed. Um, yeah, where I met Eric was, i think it was like end of 2021.
Speaker 5:I think it was before COVID, i'm pretty sure.
Speaker 2:No, it wasn't that long ago.
Speaker 5:No. Anyway, whatever Brad was talking to, i guess no, no, you're right, it had to be after COVID.
Speaker 2:I guess you guys sent them a deal to size it up for debt. Yeah. And Brad was like, oh, you talked to Eric and his partner. They're like your age And I remember on the phone with them with the first song I was kind of nervous. I was like I don't know what I'm talking about. Like just get Eric, it's like a little intimidating on the phone.
Speaker 3:Eric is a little intimidating And I got to tell you we are nowhere. You know like, in the scheme of things, we're nowhere. People all the time are like you're successful, you're doing so great And I'm like not really.
Speaker 5:No, we got a long way to go. You're always going to say that I think Yeah.
Speaker 3:That endless feeling of not being enough.
Speaker 1:Yes, yes, i was going to say it, I went to a high school reunion a couple of weeks ago and everyone's coming out to me I was like I'm not sure. Oh my God, I can't believe it, bro, You're killing it. I'm like, I'm like I just. I was just like thank God, right, I'm a degenerate Thank God. But when I went home back, I went home that day and I was like I really ain't shit. Yeah, I still haven't gotten anywhere near my goals. And yeah, I think I think that's something that we're going to all struggle with for the rest of our lives. Like that, enough this. Like, yeah, whatever, If we're worth a billion dollars or two billion dollars, it just doesn't matter. Yeah, We just need more. Can't get comfortable.
Speaker 2:Yeah, like when you get to a billion you're going to be like all right, how do I get to 10?
Speaker 3:Yeah, whether it's 10 or something else.
Speaker 2:Yeah, 100%. You know, i met a guy today. What's the next?
Speaker 3:rung. Yeah, i met a guy today that he clears 100 million net a year.
Speaker 2:Damn Over by me right In liquid.
Speaker 3:Yeah, wow, very successful people Like wow. And you know why? they started their company To hire people. Yeah, for the community.
Speaker 2:To make jobs. Yeah, wow.
Speaker 3:And they went to Israel and they just went to hire people. They're just like I don't want people to leave Israel, to go to Europe and America and other countries and leave the motherland. I want them to stay here and have a job. So they started there and now they have a thousand employees there, 2,000 here And the goal is just to retain employees. and they're printing money.
Speaker 5:But that's been the goal. I don't get it. What do they do?
Speaker 3:I can't even talk about it Okay okay okay. I really did not want me to talk about anything.
Speaker 1:But, I was just so inspired by that. That's insane. It's a goal beyond yourself. Yeah, why do you want to get to a billion?
Speaker 3:Well, when I was five years old, I wrote a business plan to buy a bank And Do you have this business? You're sick in the head.
Speaker 1:What the hell You came out of the room. I'm sorry.
Speaker 3:I was five.
Speaker 3:We all lived in an attic If you weren't sure if this guy's a little different it's like all right yeah, I called the bank Chill That was the name of the bank and I made it like icicles, Come off of it. That's how you know I was a five-year-old made it. It's like a Chill bank And my mom's like alone, you're not chill at all. I was like mom, I'm going to buy a bank one day and we're going to have a lot of money and we're going to have a great life and you and dad won't have to work hard anymore.
Speaker 3:You could live this awesome life you want And it just like converted to real estate and I always wanted that like goal right. So the goal became a billion dollars. That way I could hyper focus on something you know. So when I was in high school I was hyper focused on buying my own car and paying the bills and all this stuff. Just getting out of that. You know that poor life and problems all the time and not enough.
Speaker 3:That was an upbringing thing you know and I hope I can relay that to my children one day Where it's like you know It's going to be real hard to do that Very challenging to do stuff like that. So back then it was a bank, now it's a billion dollars. It's just an objective. You know, once I hit that objective, then maybe I'll go back to wanting to buy a bank, you know, or hitting ten billion dollars, But at that point the momentum's behind you.
Speaker 1:Yeah, so it's so much easier. You're on the elevator at that point.
Speaker 3:Yeah, i mean, i love the challenge so much, it's like a sickness. You know, my sister the other day is like alone, it's your business, it's not mine. Whatever I'm like, take it, have the whole thing, let me do it again. Yeah, you know, i still have the relationships. I have all of this. I'll rebuild it, but I know how to build it better at this time.
Speaker 5:So something about that sounds fun right.
Speaker 1:Yeah.
Speaker 5:Starting all over.
Speaker 1:We just so addicted to the chaos.
Speaker 5:Yeah, but this time starting over, i would not make the You know like you know what to avoid now.
Speaker 3:People tell me what would you do differently. People ask me What would you Alone if you could go back? what would you do differently? I'd go bigger.
Speaker 5:Yeah, yeah, that's what we said. We said the same exact thing. Me and Dave did a podcast. It was just us two And it was like if you could give one piece of advice to someone starting out, and I think my advice was go big, go big, go big Bro. I want to ask a question just out of personal curiosity. I noticed your team Everyone I talked to on your team they're awesome, yeah, they're great, and they would die for you. I feel like I just feel it. I don't know why, like, they love you, they respect you. They probably hate you a lot of the time, but Rayback is like super integral for you.
Speaker 3:Oh yeah, Rayback is a key component.
Speaker 5:How did you find these guys and like talk to me about like your culture and how you retain them.
Speaker 3:I think you go with the go-giver mentality right, and then people appreciate that And those that don't, you have to cut off quickly. So the go-giver mentality is giving first and then getting over time, you know, and if you do that from your heart, then people will appreciate you. Those that don't appreciate you, you need to be cognizant of that And you need to cut them off very quickly. So I'll give you guys a prime example. Robbie is hiding in the corner over there, my videographer Robbie.
Speaker 5:Buddy boy.
Speaker 3:How old are you now? I was born in 2046. When did I give you money to buy your first car? I think that was in 18. So before I was even in real estate, never even thought about a videographer, anything. Robbie was my cousin's friend. He said hey, i need help. It's a good kid. I've seen him around with my cousins and everything, and back then I'd e-commerce stores. I'm like what do you need help with these? I need whatever was six grand And to me at the time six grand was significant, but nothing crazy. I'm like you know what? I trust you, no interest, no, nothing. Pay back as you can whenever you can. And I bought him his first car. So over time Robbie came to work with me And you just can't make up that loyalty. Yeah, i was there for him when he was a kid. I always looked out for him anytime he needed anything, ever, and now he's with me. You know he's Robbie's my guy, right?
Speaker 1:you're dying, this guy.
Speaker 3:Yeah, he won't stab me in the back, he's Look at him go.
Speaker 1:Look at him go. You build that you know.
Speaker 3:I've done that kind of thing for Rayback. I've done that kind of thing for a lot of people in my team. Some of them I haven't. But that's just the type of person I am And I think that's. you know, that's contagious. Yeah, it's amazing And that is.
Speaker 5:I mean, that can go one of two ways right. That can either work awesome or it could. It could not work And you probably you're okay with either outcome.
Speaker 3:Exactly Because I have a goal. I can't let anything deter me from that, except for relationship. That kind of threw me off a little bit, but I'm bouncing back now.
Speaker 2:Don't take it away.
Speaker 3:Yeah, you think you have no kryptonite, and then all of a sudden it happened. Trust me.
Speaker 1:Women are very powerful. They're very powerful.
Speaker 3:Unbelievable.
Speaker 1:Oh, they'll ruin your life, They'll make they'll. You can't live without them. Can't live without them Listen, it's very important to get?
Speaker 5:Don't get me going, Oh yeah, that's right.
Speaker 3:Well, they have the power to Yeah.
Speaker 1:You know? oh, i'm not going to talk about this. He just caught himself, josh is not going to cut this one out of the podcast today.
Speaker 3:He looked at me and said don't do it, David, Please. You're not going to cut anything out of this one.
Speaker 2:Okay, so soon.
Speaker 1:David David's like three or four scenes. This has been a good one. This is good, all right. Concluding Advice.
Speaker 3:Oh, all right, There's a. There's a young man Or woman.
Speaker 1:Or a women, korean or not. She's North Korean? Well, she's not. But crazy enough. She converted to.
Speaker 5:Judaism. You should have let him say it.
Speaker 1:And now aspiring. Aspiring she means she says people in her family in North Korea are suffering, right, She wants to go and rescue them. She needs to make a lot of money. She says I heard about real estate. I want to learn about real estate. What do I do? How can I make a lot of money?
Speaker 3:That's an awfully loaded question.
Speaker 1:Where do I focus?
Speaker 3:That's a very challenging question, because real estate is built of so many components. I mean from my biased opinion.
Speaker 1:This is an Asian woman, by the way.
Speaker 3:So she's good with Excel.
Speaker 1:She's good with Excel. She's good at math, she likes math.
Speaker 3:I mean, you know, I'll generalize this to the non-Jews or North Koreans If you want to get started in real estate, then the first step you have to take is just that. It's that first step. Long story short you can't be a bitch, You know and.
Speaker 3:I've used that frame Yeah, i've used that reference multiple times Like, just don't be a bitch, just do it. There's endless you could learn online. There's endless people you can listen to. There's no lack of knowledge and gurus and everything that you can listen to. You can listen to me, you can listen to you guys, you can listen to Grant Cardone, tai Lopez, whoever you want. You just have to do it. And once you get started, you're going to learn from your own mistakes. Mitigate that as much as possible, but make something happen. If you can't take the first step, you're not built for it and you're not going to get anywhere. So, first stepping stones, next stepping blocks. Keep that in mind. Escalator follows that, and one day you'll be on the elevator if you have the consistency and the wherewithal to be focused.
Speaker 1:Got it Sounds like the first thing is take a step to learn.
Speaker 3:Yeah, go for it.
Speaker 1:You've got to go and show up at networking events. You have to pick up a couple of books. You've got to listen to a couple of podcasts, maybe pay for some mentorship.
Speaker 5:But you know what. You've got to actually do something, though You can't take it. You know how many people I remember going to those events and how many people were like oh, i remember vividly one guy saying I have to read 50 books on real estate and then I'm going to buy a deal. I said buy one deal, bro, You'll learn more than you do in all 50 books.
Speaker 3:I have a friend that can't even read. He's doing like 100 million year in condo sales.
Speaker 1:Can't even read. He can't read English. Wow, this guy's not even. And he's doing 100 million in condo sales a year Jeez, that's insane.
Speaker 3:So that's total bullshit without that guy like his ideas. But I actually don't like those questions anymore. Like what should I do? That's my first step. What's this? So go scroll through my Instagram for the last five years and you watch Long story short. what you'll take from it is that I wasn't a bitch. It took a hard money loan for a quarter million dollars, 14% personal guarantee, and everyone was an a-sayer. Well, aren't you worried about your credit? You won't be able to buy your first house. What are you doing alone? You don't even have 250,000. All you've got to your name is 40 grand, and it's that figure it out mentality that gets you there.
Speaker 1:We're going to end it with that. Alon Alon, if the people want to invest with you, people want to send you deals or just connect, what's the best place to reach you?
Speaker 3:Go to afgeecom and fill out one of the forms for a deal. Go to Alon Afgee on Instagram and DM me. I respond to hundreds of people a day.
Speaker 1:My man, it was a true pleasure to have you here today. Path to a billion Congratulations on all your success, brother.
Speaker 3:Thanks, man. I'm going to make some whale socks. This was awesome.
Speaker 5:There's two people I love on this podcast. It's people our age that are just killing it. And then there's people that have already done it before, but for you, a super motivating dude, and every time I see you you're just killing it. You make me want to go run through all. I appreciate you, bro. Thanks for everything you've done. Looking forward to seeing you at the future. I'm going to run through some more.
