Episode 81: Learning the Business from the Bottom Up with Sean Sweeney

In this episode, Sean Sweeney's path into real estate development was anything but traditional. From growing up with no exposure to investing, to pursuing acting, to starting his career as a receptionist, Sean shares the winding road that ultimately led him to build thousands of housing units and launch his own development firm.

Sean reflects on what it was like to start at the bottom, the personal turning points that pushed him to bet on himself, and the realization that time is not guaranteed. 

This episode is a powerful reminder that careers are built over time.

Sean's LinkedIn

Sean's X

Hall Sweeney Properties 

Transcript

SPEAKER_01 0:00

Welcome to People, Places, and How We Use Spaces, where we chat with amazing successful people whose stories inspire us. As a fullist, all of our guests have something to teach us about commercial real estate based on their own experiences. I'm your host, Lisa Christensen. My company helps business owners, developers, and investors buy, sell, and lay space. Hi everybody. Today on People and Places and How We Use Spaces, I am joined by someone who truly knows how to bring spaces and stories to life. Real estate developer Sean Sweeney. Sean's path into development wasn't a straight line, and that's exactly what makes him such a great storyteller and a fantastic guest. His early experiences gave him a unique perspective on people, business, and what it takes to turn vision into reality. From navigating complex projects to building communities with character and purpose, Sean brings energy, insight, and a sense of humor that make him not just a great developer, but a great person to listen to. Now let's get real with Sean Sweeney. Thank you for bringing your amazing energy to the S podcast. I so appreciate you.

SPEAKER_00 1:23

Thanks for having me, Lisa. Appreciate it.

SPEAKER_01 1:26

So I don't know that much about you. So this is gonna be super fun to get to know you better. Um tell me about your love of real estate and how how that came to be.

SPEAKER_00 1:38

How it came to be, sure.

SPEAKER_01 1:39

Well, where did it all begin?

SPEAKER_00 1:40

Where did it all start? That's a good question. I um, you know, I was one of those, so I it started at college, it was kind of the beginning of the turn to real estate. I I was one of those kids that went to college, had no idea what I wanted to do. Right. My my parents weren't in business, um, you know, just lower middle class jobs. Like we we didn't discuss in my I found out recently, unfortunately, both my my parents have passed away, that neither one of my parents made a single investment in their entire life.

unknown 2:10

Wow.

SPEAKER_00 2:10

Um so if it gives you any sort of like, this is where I started, like there was, I don't know that they knew how to balance a checkbook. Like, who knows? So I was in college just where were you at college? I went to the University of Wisconsin. I grew up, I grew up in Madison and um was fortunate um to get a scholarship to Wisconsin. So I ended up uh going there, which worked out worked out really well. Um, but I kind of not flailed through college, I didn't know what I wanted to do. You know, I started I took a bunch of different classes. I was like one of those kids I probably had like by the time I graduated, had like declared six different majors at one point or another, like in the in the whole process. And uh my senior year in college, I followed this girl that I liked to uh um imagine that. Yeah, I know, right? Imagine how that works. To uh uh she went to an audition because there was a famous producer who had done, I think the like Honey I Shrunk the Kids or something who had come to Wisconsin. I guess he had gone to Wisconsin or something, came to do like a semester-long um like directed study program where they were gonna make a movie. And I would I ended up at this audition with people, and it was a lot of pretty girls in a line, and I was like, I should stay here and and do this. And long story short, I ended up getting the lead role in the movie. What? No idea how it happened. What movie? It was called Um Blind Spot. It was filmed in Wisconsin, it was in the Wisconsin Film Festival like 25 years ago. And can we watch it on that five? I don't see, you know, it's funny, people have asked me that I don't know if it exists, like it was just before the internet. So I I graduated, I mean, I graduated, I guess, in 2000. So this would have been like 1999, maybe, where we did have dial up, right? And we had some of that stuff, but we didn't have what we have now, so a lot of it I think is lost. And um, but it was super fun. Like, I love doing it, and I was like, wait, this is a job, like you could do this. And I ended up graduating, moving to Chicago, and deciding to be an actor. I was like, this is what I'm gonna do. I had no idea, as I told you, no idea. And I spent like two or three years auditioning, you know, I got some agents, I went, I did a few commercials, I auditioned for like major TV shows and stuff like that, and uh did I don't know, three or four plays in that time. Like, didn't it didn't amount to much in hindsight, but it was like an amazing fun experience and loved it. But having grown up the way I did, and then had been like a waiter the whole time, also was like 25 at that point. It was like, okay, like I'm kind of tired of being poor. Like, like I'd like to maybe see what other things are out there where like I could like eat food and like do you know have fun. And um I had it it's so cliche to say probably now. Um, but I I read the book Rich Dad Poor Dad. And um, you know, the guy's kind of gone off the rails in recent years, but it's a great fundamental book, especially for someone who had no sense of that. Like, I didn't even think, where do these buildings come from? Like, who owns the apartment building I live in? Like it never had crossed my mind. I was 25 years old, if you can believe that. So I read this book and it was like someone hit me over the head with a hammer. And I had started dating my wife at the time. Um, I like to joke, I know she loves me because she married me when I was a starving actor, living in a one-room shack, like, which is great. Um and uh she had kind of encouraged, she's like, you know, if we're gonna have a like life together, like maybe you should do something that actually makes money. And like, you know, maybe maybe there's other options for us out there. Um, I had spent a brief amount of time thinking I was gonna go to law school then because I'm like, I ended up with a liberal arts degree, and like, yeah, what do you do, right? You go to law school. Um, and I took the LSAT and I got into law school and was like ready to kind of do all that stuff, and um had reading the book at the same time. I had started working in a law firm as a clerk. One of my buddies who had gone off to school the year before was like, You should take my job. And I I literally, I'm sure the job is like automated now. My job was to take documents to a courthouse, put a stamp on them, and walk them back. It was literally my job. It was as I said, it's probably all on the online now, but that's what I did for a whole year. Okay, uh just bizarre. Yeah. But one of the things that happened when I read the book was I started to think about like, you know, I always saw lawyers make a lot of money, wear suits, look cool, you know, all that kind of the TV image of lawyers. And what I saw was really different. And I worked at this big firm, and there was a lot of lawyers, they were in their 60s, 70s, 80s, you know, they were still working like ridiculous amounts of time. And it, you know, of course they were making money, and yeah, but so many of them were just it was like the most unhappy group of people, really. And I don't know how, like, at that point in time I had the kind of wherewithal to start connecting some of those dots. I mean, in hindsight, you know, 25 years later, I'm like, well, I of course it makes obvious sense. But you know, I was kind of a 25-year-old kid during the headlights, and something inside me was like, Don't do this, like, don't keep going. And I just at that point, I was like, I was reading the book and learning more about real estate then. And I'm like, wait a minute, the better you get in real estate, the less you might have to work someday, versus the better you get as a lawyer, the more you have to work. I'm like, I like that idea way better. And again, at that point, I had no idea what I was talking about or doing or whatever. And uh my girlfriend had gotten into, we were gonna go out to the San Francisco Bay Area. I was gonna go to law school and she was gonna go to grad school for psychology. And we already had all the plans in motion, and I was like, hey, let's, I'll just come with and figure out what I'm, you know, how I'm gonna what I'm gonna do. And I ended up um, you know, I got it was like when mortgage sales were like flying. I think it was probably so it was 2003 or four when like everybody you knew was a mortgage broker with a lot of money, right? And I figured out pretty quickly I was decent, I could be good at sales and I was like you know, impersonable and whatever. And I'm like, oh okay, I'll do this. So I started doing that, and um, it was fun, but it wasn't, I don't know, there was something kind of missing for it from it for me. And I ended up just this before you could I joke now because people laugh, like, why didn't you go on Google and research? I'm like, there wasn't Google index yet, you know. But I was like old school where I like I did have a cell phone at that time, and I I literally just started calling like friends and being like, what does your dad do? Like, can I talk to him for half like I mean I spent you know the better part of like six months like talking? What do you do? Like, what is that like? Like, what's your day like? Like, you know, can you tell me how much money you make? Like stuff like that. And I came, my actually randomly, one of my uncles was doing development in Stillwater at that time. His name is Brian Sweeney, and he's now the head of the affordable housing department in uh Des Moines, Iowa. Oh he was like converting an old prison to Kindos and apartments. I think he was working with Frown Shu at the time, and I just remember being on the other end of the phone, like, that's a job. Like, you get to like, and if it goes well, you can make a lot of like what? And I remember just like hanging up the phone and being like, okay, that's what I'm gonna do. Like, come, I'm gonna be a developer. Like, that's what I'm gonna do. That's super easy. Yeah, I'm like, well, again, with my background, I was like, I'll step, I was an actor really easy, so I'll step right into that. And that's when that's when reality smacked me in the face pretty quickly. Because that was back in the day, also where you still had to write a cover letter and send mail, literally mail your resume, right, to people.

SPEAKER_01 9:31

Yeah.

SPEAKER_00 9:31

And I was like, I'll just mail my resume all over the Bay Area. I'm sure somebody will hire me to, you know, whatever. Developer can't be that hard. And in hindsight, I'm like, God, that's ridiculous. But I sent out like 150 resumes and of course I didn't get a single phone call, right? Because why who would call somebody literally worked for one year in a law firm as basically somebody doing what I told you, and then was an actor and a bartender?

SPEAKER_01 9:53

Like, you know, I love your I love you can't, I mean, you tried. Yeah, I love it.

SPEAKER_00 9:59

I, you know, again, another hindsight thing, like I have a lot of grin. I didn't know that back then. I didn't know that's what that was, but like for whatever reason, like I just I'm good, I figure things out. Like, I just am and it it's worked well, obviously, being a developer, like that's what I do. Yeah, for sure. That's absolutely what I do. But I ended up getting a phone, finally getting a phone call. And a woman called me and said, I think you sent your resume here by mistake. But she's like, I'm fascinated, so I wanted to call you because I've never gotten the resume of an actor bartender before. And I just had to call. Oh my god, and I was like, She's like, Do you know that you applied for the receptionist job? And I was like, you know, because like I had in my defense, I had like kept a spreadsheet for a while, but you know, once it was like six months of it, I was like, I'm just mailing them to people, like not even, you know, whatever. And she's like, You applied for the receptionist job. And I was like, Oh, yeah, well, I'm trying to get, you know, I started my spiel about, well, I'm trying to get in the door and da-da-da, I'll do anything. And she was like, and we actually like completely hit it off on the phone. We had like a 20-minute conversation, and she's like, The guys are gonna kill me, but why don't you come up and meet them? She's like, I'd like you, and like, I don't know, maybe, maybe there's something. She's like, These are some of the best developers in the Bay Area. Wow. And I was like, Okay, I'll come up there. And the the it was in Marin County, and I was we were living down in the South Bay in like the Santa Clara, San Jose area. So it was a solid like hour and 20 minutes from my apartment. Drove up there, sat down, and the principal came in and he sat down with me, really nice guy. Um, and he said, What are you doing here? He's like, I'm his name. His name is Bruce Dorfman. Okay, and it's lifelong. I mean, gave me my start, one of the best guys on earth. Like, I still talk to him all the time. Um he was like, What are you doing here? He's like, I he the woman's name was Boo. Her name is Betty, but they called her Boo. Boo gave Bruce my resume, and Bruce was pissed. And he came in and he was basically like, You're wasting my time. Like, what the hell? And I was just like, Listen, I I I know you don't know me from anybody, but I will be the receptionist. I I'm I swear to God, I'm smart. I work really hard. Like, I literally live an hour and a half away, and I will drive here every day. Like, I don't care. I just need somebody to like get me in the door because I'll I promise you, like, I won't disappoint you if you do that. And he was just like, dude, what? He's like, what do you know how to do? I'm like, nothing, like literally nothing, but I'm smart and I will figure it out. And he was like, All right, I'll whatever, whatever, I'll think about it. And I left and like three, I sent a thank you. You know, that was again, you would like write a thank type or write a thank you note and you would mail it because that's the only way to get a hold of people. And he called me like a week later and he's like, Why don't you come back? And I was like, Oh, okay, cool. And he had me meet his partner and then the VP. There was only like four guys in the office. Um, the name of the company was Thompson Dorfman Partners. What I didn't realize at the time is they had run Tramel Crows West Coast operation. They were like the partners for Tramil for a long time. Wow. And had like within the past year broken off, you know, had had one of the transitions out of Tramil and had started their own entity and were like pursuing so institutional level guys in a small firm.

SPEAKER_01 13:14

Perfect.

SPEAKER_00 13:14

Yeah, I mean, I couldn't have scripted it better. And they they were, you know, like, look, we're gonna pay you barely anything. You're gonna literally sit at the front. I mean, I literally sat at the front desk. I made I made copies, I made coffee, I did anything they asked me to do, and I made sure, you know, I tried to control the little things that I could control, like I'll be the first one there, I'll be super easy to work with, I'll just say yes to everything they asked me to do, I'll make sure I'm the last one there. I'll just try to make their lives easier, right? Like that's all I know how to do right now. And that evolved into, you know, three, four months later, the VP came over and he's like, Do you know how to do Excel? He's like, I am buried. We've got like four deals we're looking at. And I'm like, sure, I know how to do Excel. I have no idea. I didn't even know Excel was. But I went home. The internet was finally starting to be there now. So I could like go home and be like, What is my like how do I learn Microsoft Excel? And I literally taught it to myself in like a month and started to like did started to do spreadsheets and da-da-da. And just like over time, within a year, um, they called me into the office and they're like, All right, we got another deal, but we're we're so full, but we don't want to hire anybody else. You want to take it? And I was like, Yeah, yeah, yeah, I'll do it. So I was a project manager, I still sat at the front desk, I still made coffee, I still did all that, and they made they took every um opportunity to embarrass me, as you can imagine, because I was 20. So by then I was 26 or 27. And you know, there are brokers who are 27 who are crushing it. There are lenders, there are all kinds of so these guys would come meet with them and they would introduce me as the receptionist and be like, please give Sean your coffee order, he will bring it to you. I mean, they took every advantage to like make fun of me, but I just smiled and was like, Yep, let's go. And um, I ended up working there for six years.

SPEAKER_02 14:54

Wow.

SPEAKER_00 14:55

By the end, I was an associate partner. I was I managed four or five developments up and down the uh Bay Area. Um, you know, the only thing honestly that ended up working in to the negative to me in that job was we can I kind of hit my peak with them in 2009. Like I was in charge of a new condo building in Walnut Creek and we delivered it and it was awesome. But you know, the market like every the world started imploding shortly after, and um it was it was a really tough time because I loved those guys to death. I mean, you know, like I literally go to Vail with one of them every year, like and stay in his condo with my family. Like we're like there for my forever guys, and um, it was so tough to leave. But like my wife had finished grad school, you know, she had gotten her hours as a therapist, but wasn't getting in California, you do them without getting paid. So, like we're two kids from the Midwest, you know, just about to hit 30, out there, like we're on this great trajectory, and just everything just was like completely stopped, as you you know, you know, and then everything imploded. And the other down the one downside of real estate, right, is like you don't get a high salary, right? It's all upside and different things. And so I was in a position finally to get upside in the deals that we were doing, but and people joke here that it's hard to get stuff approved. I'm like, you guys should go work in the bear. I've got uh yeah. I mean, entitlements can be 10 years. Wow, and my wife's name is Kim. We had just gotten married, and Kim and I were, you know, took kind of an inventory of our life and we're like, do we want to stay here? You know, do we want to move an hour outside the city to be able to stay here? Like, what do we want to do? And Kim had grown up here in Minneapolis. I grew up in Madison mostly and you know, loved Minneapolis, used to come up here and get our butts kicked in hockey as a kid and all that kind of stuff. Um perfect. And so we were kind of we were looking at like, let's go somewhere, let's just we gotta move somewhere a little cheaper for a little while. Let's see how the world, you know, what happens, and then we'll figure out what to do. And so we looked at like Portland, because that was nearby, Austin, and here. And I joke, I cost myself a lot of money by not moving to Austin, but that's a whole other discussion. Yeah, right. Um, but we decided to move here and we came here, honestly, Lisa, with just like a two-year plan. We're like, we're just we're only committing to two years, and we won't pull the ripcord before two years because we have to really like give it a chance. We have to be both feet in. And then if in two years we just we we can't do it and it's just not working for us, we'll we'll, you know, we would have been 32 then at that point. I'm like, we'll go somewhere else. And I was lucky to get a job with ArtSpace. They were like the one group still they needed some help, and they were the one group doing stuff, and I was like, hey, actor, real estate developer, here I am. And they were like, Oh my god, this is perfect. So did some work for them for a couple years, and then as the market started to kind of it's 2011, the market started to kind of improve. Um, I ended up um I was looking at jobs with various groups, but I ended up taking an acquisitions job with Timberland partners. Oh and with Bob and Matt.

SPEAKER_01 17:55

So I did not know that.

SPEAKER_00 17:57

Yeah, I worked, I worked there from 2011 to 2017. Uh, Matt and I were like the two acquisitions guys. What a great group. And it was oh, it was so great. And it was it was the first time. I mean, working for the guys in California was fantastic, and I learned so much about real estate, so much about development, and just finally was in a position to like, okay, I don't know it all, but like I know enough to hopefully do something. And then working with Bob and Matt was fantastic because in California I was a project manager, right? I didn't put the deals together, I didn't assemble the financing, but they were like, okay, here's the next one, you go make sure this happens now. And I would do that. So Bob was like, here's a computer, here's a phone, go buy me deals. I was like, what now? How do I do that? He's like, Well, you'll have to figure that out, won't you? Um, but it turned, I mean, the first few months I was like, oh my god, these guys are gonna fire me because I have no idea what I'm doing. But you know, like all the other stuff I've done, I figured it out. And within the six years that I worked there, Matt and I bought something like 8,000 apartments. Wow. Um, and you know, for me, selfishly, it was the first time. Um, and I I with Bob, I made a I kind of negotiated a deal to work mostly on commission because we were all pretty confident in what was about to happen. And I was like, I'm 32 and I've never made money in my whole like never made any real money, so like let's go. And so that was just an unbelievable six-year period where I learned a ton, I finally made a few bucks for myself, which was fantastic. Um, and just it was it was so great. And our time, I mean, the timing 2011 to 2017 was fantastic. Um got to a point where I realized, you know, I the only downside of that job, and this is not a uh, you know, a knock on them. It it's I joke, I'm like the billionth person in real estate to hit this problem, was I wasn't getting any equity in those deals. I mean, I was getting great bonuses at closing and all that, which is was amazing. But you know, I had had my second kid at that point, and I was like, okay, like I need to not start at zero every year and have a little money to invest and like try to figure that out. And um, you know, they uh I thought maybe there'd be an opportunity to kind of do that there. And it it, you know, to Bob's credit, he was very, you know, straightforward with me. And I that a lot of people aren't like that. They'll dangle the carrot forever. And Bob was like, look, we don't, you know, it's a family business, this is how we're structured. Like, my kids are gonna take it over. Like you're super talented and you have a job here forever if you want it. But, you know, I can't promise you that you know, you'll be sitting where I'm sitting at some point. And I was like, okay, like I appreciate you saying that. And I, you know, go think about that for a little while and see how I feel. And and then I had one of those, like, I joke I had my like midlife crisis at 38 because in a in a very condensed amount of time, um, my mom, who had been sick for a long time, passed away. Sorry. Uh, one of my best friends from college passed away. Wow. We had our second kid, and my lifelong team, the Chicago Cubs, won the World Series. And I know that sounds ridiculous, but on top of those other things, I was like, a lot of and this was all in like 60 days.

SPEAKER_01 21:02

What?

SPEAKER_00 21:03

And it was like, you know, I mean, everyone, I think, as you get older, you go through those periods in your life where you're just like, what just happened? Yep. And you kind of, if you're paying attention, in my opinion, you don't come out the same person. You something changes in you. For sure. And I just remember like what we were, and we were remodeling our house at that point. So we were living in a rental. I mean, it was just Lisa, ugh, it was a it was a it was a summer. Um, and I remember like uh going outside of the rental house one morning, just while everyone was still asleep, and I was just like, I gotta go sit aside, and I was like watching the sun come up. And it like hit me that like my mom who had died was 76 and I was 38. And I like did the I was like, wait a minute, like, holy crap, like I'm halfway there. And you know, hopefully, obviously, I I'm you know, take good care of myself, I'm healthy, like hopefully I'll live a lot longer than that, but there's no guarantees, right? Absolutely not. And I just I like stood up and I'm like, all right, it's go time, I gotta just figure something else out. And excuse me, I you know, I talked to some folks around town to see what you know what other jobs there might be, like if there were, but I had kind of gotten to the point where there wasn't really a step up. And I mean in the way I wanted to do it in like a deal team, and I uh I always I haven't probably seen him in a while, but Chris Culp said to me, I he was one of the guys I talked to, and Chris was like, I think you need my job, and he's like, But I'm not gonna give you my job. I'm like, no, that's fair. Like, I and I just kind of woke up one day and I was like, Oh my god, like I think I have to do this myself. And I because and you know, based on my past, like I was never somebody who was like, I'm gonna own my own company, like it was never that about that, it wasn't about that for me. Like, I was always just looking like what's the next step? What's the next like where's the world taking me now? You know, that kind of stuff. Right. And I got and and honestly, it scared the crap out of me. Yeah, interesting. And I was like, oh god, like why am I doing this? But it just I whatever reason, like you know, they have the they have that saying that like the pain of staying was was stronger than the pain of like the scared the fear of leaving or butchering it. But no that's saying, I get it, yeah. Um I just said, all right, I'm gonna do it. And started talking to a couple of my mentors and people that had been good to me. And uh one of them was Jeff Hall, who um was like, you know, if you find, yeah, you should go do this. And like if you you're smart, you'll you'll figure it out. Like we we've all figured it out. There's several bumpy years to begin, but like you'll you'll get you'll figure it out. And he's like, if you find something, let me know. I'll see if I can help you or I'll help find somebody to help you, whatever. And so I I left the job at Timberland and just started looking for uh development sites, and I because I had this theory that like I couldn't compete with like I wasn't gonna quit and compete with Timberland. I knew the economics of stuff enough that like I'm not gonna go just buy a fourplex and think that's gonna like help, you know. I mean it helps, but it's not really gonna do anything for me. Right. I have to make money to feed my family. Um and I realized that like there was all of these development sites that were like perfect for 30 units or 50 units or 70 units, too small for any big any real developer to like pay attention to, but the guys who are doing small-scale building houses and stuff still way too complicated for them to do that. And I was like, maybe there's maybe there's a business here. And I ended up putting a site under contract with a with a buddy of mine, and we ended up flipping it to Michael Lander, made a little money, and then I started looking around time like these sites are everywhere. So then I found another one quickly, and I actually called Jeff and I was like, So I found a site, here's what I'm thinking. Who should I call? And he's like, How about we do it together? And I was like, Oh my god, that'd be great. So Jeff and I did that deal, and I just like it just started multiplying. And I my big fear when I had left Timberland, one was am I ever gonna be able to make money again? Yeah, right. But two was like, you know, how much of what I'm doing is Timberland, like is the Timberland brand behind me? And how much of it is like, I'm actually good at finding sites and doing this, like you know what I mean?

SPEAKER_01 25:10

Like I had that question, and and and obviously you understood the financial piece of what makes an apartment building work. So you being able to underwrite that many deals, because I'm sure you bought 8,000 apartments, but you clearly underwrote hundreds more. Yeah, exactly.

SPEAKER_00 25:27

So that was yes, the advantage. I mean, I think the advantage I had, probably again in hindsight, was I was able to bring a level of more institutional sophistication to maybe a little bit of a smaller, middle, smaller scale. And that allowed me to kind of quickly get sites before other guys even could figure out what was going on. Like, is this even good? I don't know. And I was like, I'll take it and here's what I'll pay. And you know, so within you know, within a couple of years, um I had like five developments going, and I had was partnering with Jeff, and and at that time we didn't, Hall Sweeney wasn't like a formal, like we, you know, because Jeff's like, look, I've been doing this for 20 years. Like, we're not not burning the ships that after one deal with you. Let's let's kind of check this out. Um, so I you know, I did a couple other deals with a couple other guys, and um Jeff and I really found that kind of after doing a couple projects together, we were a really good combination of I mean, we were joking, we had a coffee this morning, we were joking about it. Um, I'm like, I'm glad you're there to always keep me logical. And you know, we're we're kind of one plus one is three. The two of us, the two of us together. It's hard to find that. Oh, it absolutely is, and someone who you get along with, who I think you see the world, you know, pretty similar as. And um, a lot of what I was bringing, you know, wasn't in Jeff's wheelhouse, and a lot of what he had to offer was stuff I was looking for, right? Experience and capital and a million, I mean big picture knowledge, a million other things. So it ended up going really well. So we, you know, after the second deal, we formalized Hall Sweeney properties, and that was probably in 20 early 2020 at this point, and you know, have done several other projects uh since then. And um, I've yeah, I've been, you know, I figured out the other day, I've built close to a thousand units in the city. Thanks. And um, you know, I've been involved in like 12 different projects, and you know, we're we're off and running. We're you know, we're looking, I mean it's hard now. It's really hard. Talk to me about how talk to me about how what we're doing, it's it's actually interesting timing to be having this conversation because we are we're not abandoning our roots, but we are pivoting slightly. I'm we're kind of going back to the Timberland-esque kind of model. We have our first property. Well, I can't say where it's not under contract yet, but it should be by the time this conversation is over, hopefully. Wow. Um, but we're we're in the meantime, while you know, development, I mean, there are some one-off apartment deals here and there for a million different reasons, right? You know, they've had the site forever and they finally got the equity together, or they just gotta go, or they're gonna lose it. I mean, there's you know, but at scale, there's no apartment development going on here.

SPEAKER_01 28:04

Correct.

SPEAKER_00 28:04

And, you know, to your point earlier about knowing the numbers, like I I make the argument to people, I think NOI is 20 to 25 percent away from where it needs to be. And as you probably know well, NOI does not mean rent growth, right? So even if we have five years of robust rent growth, that doesn't mean we're gonna get, I mean, it'll get us a lot closer, right? But unless expenses kind of stay moderated, like yeah, you know, I had lunch with a uh other fellow developer recently on Monday who was like, I think in the city specifically, it's five to ten years.

unknown 28:36

Wow.

SPEAKER_00 28:36

And I was like, oof, that's that's rough. Yeah, that is rough. Um, I think the suburbs will come back faster and whatever. And you know, there's I mean, there's a million different factors. Yes, none of us know what's gonna happen in a million different ways right now, both locally and federally and and everywhere. Yes. But um, so we're yeah, we're taking the opportunity. I mean, we're really fortunate. We um we started raising money when we did for our deals, kind of friends and family. And I joke, like, I don't have any rich family, so mostly friends who I've met along the way. Uh, and and we've, you know, our list has grown to the point where you know, we have our last couple deals, we have 50, 60 individual investors in, and we probably have three or four hundred on our list at this point. So we're you know gonna lean on that. And and I think the fact that we never did kind of an institutional deal with a group or whatever, like we've been able to stay small and nimble, and and I think it's helping us right now because we have low overhead and we can pivot into something like this temporarily or permanently alongside our development. Um, because I think the market does make sense to start looking at buying buying things now. I mean, things are selling for discounts, and yeah, that's when you buy it, right? That's not when you build it.

SPEAKER_01 29:44

Right, for sure.

SPEAKER_00 29:45

And um newer product or older product or we're we're open to any, I mean, we're I would say our we're open to anything. I think what we're finding is there's still enough big institutional and and other group capital that like the distressed new development stuff, people are paying cash. Like there's enough big groups, Widener, you know, the Timberlands of the world, that it's really hard to compete with that because they also not Timberland as much, but Widener, for example, you know, there's no investors. Right. So he can pay whatever he wants and he can hold on to it. And it's hard to compete with that when you have to provide a return. Right. Um, we're finding, we think there's kind of a niche again, back to the old business plan in the middle, where you know, slightly older, 70s, 80s product, but a hundred units or so. I mean, our the deal we're hopefully gonna be buying is 111, so kind of in that, you know, in that range. Yeah. Interesting.

SPEAKER_01 30:38

Yeah, it's hard to find deals though, isn't it?

SPEAKER_00 30:41

It is. It's it always it's hard to find good ones. Yeah. And when you do, you're usually not the only. I mean, in today's world, Jeff and I were just talking about this today. Like, off-market isn't really a thing anymore, right? Yeah, off-market is a broker calling you and it's like, well, I called six other people too, but it's off-market, right? I mean, and that's okay. That's just the way the world is gone. So it's really, I think the way you get you you hopefully get deals is you know, you're you're easy to work with, you have a good reputation, and when it's between you and another group or you and two other groups, the broker says, Well, I know if you give to these guys, they'll do it well, they'll get it built. And that's that's all you can really focus on. Yes, is just trying to trying to be trying to execute well and be easy to work with, I think. Right.

SPEAKER_01 31:20

Is it harder to raise equity or capital in this market?

SPEAKER_00 31:24

Um, I mean, it's yeah, you know what I'm saying. Yeah, it's hard. Um debt has come back. Debt has come back, and and on the you know, on the existing stuff, Fannie and Freddie are still in the market. So there's still some attract, there's some really attractive debt um for those types of deals, which is exciting. Um, equity is is harder. It's not impossible. I mean, one of I think you know, we've all everybody in real estate is you know taken it on the chin the last couple years, right? Last three years, let's call it two or three years. You know, it it hasn't necessarily been the goal, the whole macro economy, though. You know, there's a lot of other people other industries and other people that are doing great, right? You know, we have several investors that even in the depths of things like a year ago were like, what's next? What's coming? You know, because they're still doing great and they still have money and they're ready to invest and they want to make returns on it. So, you know, we're gonna go out and raise on this deal uh very shortly. Um, so I would have a better answer for you in a couple weeks, but I I think that I think that we should be just fine still for the right stuff and the right story. I mean, I think people are looking for more uh I think it would be harder, honestly, if we went out with the development right now. Yeah. To say, give us your money for a few years, don't worry about it. You know, that was easier when things were humming and whatever. People want a little more certainty, and not that there's ever certainty when you you invest, but to be able to say, like, here's the cash flow in year one if we don't do anything, right? If nothing changes, you'll actually get a check every quarter. Right. You know, I think that'll be a little bit of a different story, yeah, and and so much easier to plan for that. Yeah, yeah. 100%.

SPEAKER_01 33:00

Do you do any acting anymore?

SPEAKER_00 33:01

No, you know what's funny. Um, I don't, but my daughter, my oldest daughter is 12. Uh, she played young Elsa at Children's Theater in Frozen.

SPEAKER_01 33:11

Oh my goodness.

SPEAKER_00 33:12

Yeah, last this summer, and is starts rehearsals tomorrow at the Guthrie for a Christmas Carol.

SPEAKER_01 33:19

Oh my god.

SPEAKER_00 33:20

So my my older daughter's in.

SPEAKER_01 33:22

I love that so much.

SPEAKER_00 33:23

Yeah, it it was it was one of those things where, you know, like all kids, like, right here, play soccer, play softball, try this, try that, tried a million things. And you know, two or three years ago was like in the basement of a church in Edinho doing a small little play, and just says boom, boom, boom. And I mean, the Elsa thing was a pretty big break, and now she's yeah, she's up there doing professional theater already, which is insane. Yeah, it's it's pretty nuts. It's pretty nuts. Um, and my younger daughter, who's nine, is just a light out ballet dancer. Right. Will be, I mean, honestly, probably will be a professional ballet dancer. Wow. Like, is that good already? That we're just like, I don't know where, like, my wife and I kind of scratch our heads. We're like, not sure where this came from, but um, my my older daughter is gonna potentially after Christmas Carol is over, uh, is gonna go back to the community theater that she started at because they're doing newsies this spring. Oh fun. And it is open to everyone. And my wife has been joking that she signed me up a bunch of times, but like I can't sing or dance anymore. Like, I can't, no, no, I can't do that. But um, it's not we're still very um having Reese be active in theater. We've we have gotten we're very involved in that community now, too. So I like to think I'll hopefully be a theater benefactor. You know, I go see a lot of shows with them and we know a ton of people in it now. So um I'm I'm adjacent connected now.

SPEAKER_01 34:45

I love that so much.

SPEAKER_00 34:46

Yeah, it's been a really it's been a really fun kind of coincidence for that to come full circle in that way. Yeah, you probably won't see me on screen, but in that I mean never say never.

SPEAKER_01 34:56

It seems like things kind of drop in your lap and they turn out.

SPEAKER_00 35:00

Yeah, I've been I I will tell you, I have been, I mean, I I've done all the I've done my best on the inputs, right? Like the hard work, like all the things that I can control. I've tried to do as best as I can, but I've absolutely been the beneficiary of you know, so much luck. So and so many people, especially in this community, too. Like when we are really blessed in the Minnesota real estate community that people are so open to talk, to help, to network, to meet, you know. I mean, you try to go to New York and have coffee with people, good luck. Like even San Francisco, like you had a bang down the door to have any developer go take it, you know, go spend 15 minutes with you. And people here are so generous and so gracious. And yeah, I mean, I've I've tried my best to do what I can control, but I I have been beyond fortunate with like good luck from people. I just yeah, the balls bounced my way a few times too, which has been nice.

SPEAKER_01 35:54

Yeah, yeah, but you know, you've had your share of things come up and you just figure out how to get through it.

SPEAKER_00 36:01

Yeah, yeah. I I joke with people, people are like, Well, how's it going now? I'm like, well, when you don't grow up with much, you know what it's like to have 17 cents in your checking account, and you know, you know no one's gonna show up at your front door and and beat you up. Like you just you just figure it out, and you you know, we had some years in San Francisco where I was like, I don't know how I'm gonna pay my rent next month. You know, like I mean it, I think it um, and it's probably a it was probably good training for the ups and downs of real estate, honestly. Like, again, in hindsight without realizing it, like having been all over the board income-wise, younger and you know, not had a lot for a long time, like you realize like you you're okay. You'll be you'll be fine. You can as long as you can eat and you have a roof over your head, like you'll be all right.

SPEAKER_01 36:45

Yeah. Well, it'll be fun to to watch you do more and more. I hope we yeah, I hope we can. Yeah, I hope we can. Yeah, you will continue to. Well, I know that. Thank you. Yeah, thank you. Thank you so much for having me. It was really fun to hear more about your story. Thank you for listening to this episode of People, Places, and How We Use Spaces. I am business owner, broker, commercial real estate investor, and your host, Lisa Christensen. If you like this episode, please subscribe, share, and leave a review. To connect with me or the guests on today's show, shoot me an email at Lisa at Christensenandco.com. That's Lisa at Christensenford and Co.com. Thank you so much for listening. Have a great day.