Innovative Strategies in Real Estate: Exploring Investment Success with Romano Muniz

Are you ready to stretch your real estate investment boundaries? In our latest episode, we sit down with Romano Muniz, the COO of Blue Modo Media. His fascinating journey from residential to commercial and industrial real estate is full of innovative strategies that will make you question everything you thought you knew about property investment.

Romano regales us with tales of buying properties at an astounding 80% discount in bankruptcy deals, and how he's learned to leverage the time value of money. From low buying to high appraising, we tackle a range of strategies that have helped Romano achieve massive success. He gives us an inside view into his unique methods of investing in real estate, which include unconventional tactics like leveraging cell phone rights and using cost segregation. The world of creative financing is vast and varied, and we discuss options like seller financing, assumable mortgages, and rev share agreements that can open up new opportunities for your real estate ventures.

But successful investing isn't just about the deals and dollars. We get real about the challenging aspects of real estate, emphasizing the importance of being strategic and intentional in all actions. Moreover, we reflect on the importance of building generational wealth and creating a legacy that will outlast us. This episode is an infusion of wisdom and actionable strategies that will inspire you to elevate your real estate game to new heights.

Onward!

Visit Us Online
OUR WEBSITE
FACEBOOK
YOU TUBE

Transcript

: 0:00

This is the Legacy Wealth Code podcast helping you build long-term wealth and a lasting legacy through real estate investing, tax strategies and motivational stories from some of the most successful and influential people out there. Here are your hosts real estate investor and entrepreneur, r.

Michael Notbohm: 0:20

Hey guys, welcome back to another episode of the Legacy Wealth Code podcast. My name is Michael Notbohm, here with my partner in crime, Andrew Hoek. H.

Andrew Hoek: 0:26

What's up, guys?

Michael Notbohm: 0:27

So we have a guest today that I think everyone will get a lot of value out of. Romano Muniz is the COO of Blue Modo Media. It's a high volume lead generation company doing leads in mortgages, insurance, legal services, education $40 million in top-line revenue in 2022, growing exponentially year over year. And, you know, good friend of mine. It's funny because he you know, we've had long conversations about legacy and things related to that and his mantra is to serve those I'll never meet, so creating an impact on those you know, friends and family, not just now, but for generations to come. So welcome to the podcast.

Michael Notbohm: 1:06

Appreciate you guys having me Absolutely. So let's talk a little bit. You know, obviously you've got a ridiculous track record of success partnering with another good friend of ours in the Blue Modo Media. Now you're taking that money and you're reinvesting in real estate. So I want to talk today about kind of what you're doing, what you're seeing, because I've always, you know, hats off to you for finding these niches.

Michael Notbohm: 1:29

I think it's pretty crazy some of the stuff that you're doing, so excited to share with everyone today what you're doing. So walk us through kind of what you're doing right now real estate wise.

Romano Muniz: 1:36

Yeah. So with all the growth of Blue Modo, what we realized, really thanks to you, kind of put us onto cost segregation. We realized either one we're going to have to pay taxes one way or another, or through cost segregation, we can buy more real estate that's cash flowing and use that depreciation to minimize our tax income on the marketing side. And so when we first started out it was the traditional residential play Go to Buffalo, New York, buy duplex for 25 grand, put $50,000 into it, get it reappraised at 120, cash out Re5, 15 grand on it and then you have two doors cash flowing. We kept on stacking that up. Then we started realizing, hey, is this the best use of our time? So then we started looking at what's the commercial deals look like.

Romano Muniz: 2:17

We went into a commercial mastermind course, learned about that play, got invested in a bankruptcy deal. It was 10,000. Let's see, it was 156,000 square feet bankruptcy deal. We ended up getting it for like 3.5 and probably valued at 8 to 10 million. So we got to co-invest in that. Then we started focusing on the bankruptcy deals. I initially started pitching bankruptcy attorneys like randomly calling them, seeing if we can get in with them, buying them at an 80% discount the one that was like our home run we got. It was six acres, 40,000 square feet, I think. It was 33% occupied and still cash flow positive. We bought it for 1.2 and before we could do anything to it it was valued at 5.1.

Romano Muniz: 3:05

So no extra money in. And so I guess I'm bringing up all those scenarios because we realized like all right, if we look at this data, kind of like we do with marketing what's the best use of our time, and we kind of pulled it down to bankruptcy deals because even in the height of the market we're getting 80% off Groundup construction when you partner with a developer. So instead of buying it at $500 a square foot now we're getting it locked in at 100, 120 square foot and do a rev share with them. And then the most recent one's been industrial. Last year we bought 147 and a half acre property on the Houston ship channel and that side is wild because it's less about what the existing cash flow is or tenants on site, it's more about what's the existing replacement value. So if they had a railroad track or a substation or water permits that you have access to the value. On that I think most people don't realize how to really extrapolate it and get the maximum value from it.

Michael Notbohm: 4:01

Yeah, I mean you're talking about stuff that most people don't even know about. We talk about this a lot with how crazy real estate's gone over the last few years. Replacement cost is still more, I think, at least in most markets. I think it's more to rebuild something than to buy it, which is usually not the case.

Romano Muniz: 4:20

And even just being grandfathered in, like if you wanted those water rights, like that property, we're in for 1.2 million gallons of water a day. Even if you had the money to get it, there might be a three to five year process to even get approved for it. So the folks that want to buy it look at the time value of money differently and use this. Extrapolate all these different little widgets from each property and you can go command a wild upside on it.

Andrew Hoek: 4:43

Talk a little about your transition. It sounds like you started where I think a lot of real estate investors started. You said you buying duplexes, small multifamily, making that leap into commercial. Talk a little bit about that. I feel like for some people there's a little bit of a I don't know if it's a fear factor or like it's just different. You know, everybody, everybody seems to have some sense of residential right Because it's a housing, it's commodity, and you're doing it yourself, right, right, um, what was that move like for you? Was that, was that scary?

Romano Muniz: 5:18

What have you learned from it? I kind of see it as like a practice rep. You go to the basketball game, you get your practice in and then you're prepared to go to the actual game. Even before we got into residential like you'll see corporate housing now, before we ever got involved with this, I pitched somebody here in Tampa to borrow their house and basically did a rev share deal with them, so literally just like almost like a corporate lease, took it over, put on Airbnb and kind of beta tested it that way. So that's where I got my feet wet and have the money to buy it.

Romano Muniz: 5:47

And then after that I started realizing all right, what's the amount of time put into this, what's the cleaning costs, how much am I involved in it? And then realized, man, if we want to take advantage of these cost segregation opportunities or even cash flowing, we got to own. But then even acquiring and buff flow, it's like you stack a couple and you realize, man, the maintenance up north, the wind, you know the winner that eats at your cash flow. Again go back to the data, like what is the best use of our time? And so, instead of just going straight commercial, it was how can we get into more doors but also buy it at a discount.

Romano Muniz: 6:17

Hence the bankruptcy for commercial. So, and I love the idea of margins, because especially now in this market, if things go sideways and somebody's buying just to go for, like an Airbnb, those margins are thin, or if compliance changes, you better have another model to figure out or in this model, if you're already up 80%, you can call it a couple of different directions without having all that pain point of this is the only way it's going to work. And so that's when we started realizing, hey, how do we start to scale up? And that's when we started going into commercial and realizing more doors is definitely the answer.

Michael Notbohm: 6:51

Well, you know, being in a marketing space where you're asking people to spend huge amounts of money. I remember my first job in yellow pages. You know I was making 35 grand a year, but I'm asking this guy to spend 4,000 a month on a full page ad in the yellow pages. And one of the guys that I worked for told me never sell out of your own pocket. And I think that that resonated with me and I was able to just go into these sales calls and say, hey, it's five grand a month, but this is the value you'll get. And I think you and I are very similar in that, because the fear factor I think, and this is just.

Michael Notbohm: 7:24

You're adding more zeros? Sure, but if you've got the plan built out, you know you've. You mentioned something that's super important. It's did I take 500 free throws before I got in the game and had to shoot a free throw, right? That goes a long way, cause then it's just muscle memory yeah.

Romano Muniz: 7:38

And I think people get caught up in like the information overload. There's every blog out there, there's every guru out there. If you are kind of stuck in that mindset, how do you partner up with somebody that's already doing it? How do you almost in turn for somebody? How do you work with guys like yourselves and say I don't have the money, I don't have the real estate, how do I earn the right? Can I take the worst things that you're doing that's taken away from you, building value? Just let me earn the right that way. Or if I find the deal like I've wholesaled a couple of deals too.

Romano Muniz: 8:03

So I went from the Airbnb kind of arbitrage play to what midst of I find this guy a deal, and instead of doing the traditional, if I hold the contract, then you get the papers and I'm negotiating on both sides. I would figure out what the developers wanted, what they need in their margins and, as long as we had some sort of agreement on the front end, just introduce them direct. Now you're not doing this whole back and forth game. Oh my God, what do I say? How do I negotiate? It's cool, we have an agreement. I need to focus on adding value to your first. Here it is.

Michael Notbohm: 8:31

So maybe Romano actually invented the Novation Agreement sounds like. You didn't even know you were doing it and you were doing it.

Romano Muniz: 8:37

I was just trying to figure out a way to get in the game man. Yeah, I mean, that's pretty cool.

Andrew Hoek: 8:42

You know, what you're talking about reminds me I'm reading a book right now called 10X is easier than 2X. You ever read that?

Romano Muniz: 8:49

Oh yeah, I'm listening to it right now too. Yeah, it's been really interesting to listen to.

Andrew Hoek: 8:52

but everything you're saying reminds me very much of that kind of mindset. Definitely yeah, and it's the same deal with the industrial space.

Romano Muniz: 9:02

What I realized was like the marketing process. If it's all just a process and a system and we know how to execute on it, what's the difference between another zero? It's the same process. If anything, it's easier. Sure, the higher the money goes. Or when we bought that property we didn't have the money to do it, so go back to the old school model. Or if I don't have it, what else is available? We put in the offer at the same time. We started the real estate syndication, negotiating and raising money all at the same time.

Romano Muniz: 9:29

But I just found that even in that process, as long as you can just dive in, figure it out, you'll ask questions. You'll ask more effective questions. Somehow it ends up working out. I think it just pays to be in the game. Overall this whole real estate thing, or any business in general, I don't think there's this crazy overnight success. I think it's those who are just consistently daily chipping away, constantly doing something to chip away at it, ask questions, get involved, but the difference is just those small concerted efforts to get you there. Yeah.

Michael Notbohm: 9:59

So walk me through. Your background wasn't real estate. And yet, just even the last couple of years, since we've gotten to know each other, you're partnering with people who are doing this at a ridiculously high level. At a ridiculously high level, getting involved in masterminds, which Andrew and I are huge advocates of, always trying to better ourselves. Like can I be in a room where everyone is smarter than me? That's the room you want to be in. If you're smarter than everyone. You're not. You know learning. You know you might be the one that everyone's trying to get value from Right, which there's a place for that. You know we're open to sharing how we've done stuff, but how do you? You know, what do you attribute? Being able to be in the same room as these people and and not just being in the same room but taken seriously where they're asking you to be part of these deals.

Romano Muniz: 10:44

I think a lot of it is the scarcity mentality. Is I know something, let me hold it. What got me into the bankruptcy space was when we're in the mastermind group. I looked at everything like a parabola One week they had funds to do it, the next week they didn't. But when they always said yes was to bankruptcy deals because the margin was there and so I just took that on. You know, by the horns called the bankruptcy attorneys.

Romano Muniz: 11:07

Once I figured out the play and I was one of the only non bankruptcy attorneys on the bar association, I literally gave them the play by play. So I share that to say, by giving the play by play, focusing on there's more than abundance, no matter what you think, you know, just put it all out there. That helped me earn the right to go speak on stage at a conference in California which helped me meet the broker in the industrial space which turned into what we're doing now. So I think a lot of people are just trying to hoard information or let me go meet with Mike and get something for me. I'm like, give it all away and somehow it just compounds away faster.

Andrew Hoek: 11:40

Yeah, those doors that you open like that are incredible. Explain the bankruptcy piece to me a little bit, because I feel like I mean, I probably have a little better understanding of bankruptcy than most people with the legal background, but it's still such a foreign concept. So are you actually buying those from the trustee or how does that work?

Romano Muniz: 11:59

Yeah. So back to the modeling standpoint. What I realized through bankruptcy was, if you're my attorney and I'm the client and also I need some sort of funding, a lot of these bankruptcy attorneys have a hard money lending company on the side and so what they'll do is they'll transition over and say, hey, I'll lend you the money In court. That's a huge conflict of interest. So they'll bring in a third party conflicts attorney. They verify hey, do you understand that your attorney is lending you the money? That's all kosher.

Romano Muniz: 12:27

So I thought, man, if we removed hard money lending and put in real estate, is the same process applicable? The bankruptcy attorneys like having the paperwork trail with the hard money side because they can do it easily, but from real estate they can't operate it. So if you can bring in the value of how do I operate it? Now, if you had third party conflict attorney, could they co-invest with you and it'd still be kosher. Could they give you the lead? Now you're not doing the run into the bankruptcy court or the courts downtown to get a foreclosure list, competing with everybody else. My whole thought process on all this is what everybody else is doing. Do the opposite, and it takes a couple more steps. But man, those opportunities are like when I showed earlier buy for 1.2, appraise at 5.1, there's no cap X, there's nothing, so you have instant value kind of broken into it. Sure yeah.

Michael Notbohm: 13:16

When there's also a lot of times on those commercial deals there's things that most don't even realize, Like you buy a building and then you have the cell phone rights on the roof.

Romano Muniz: 13:27

You know like what is that worth?

Michael Notbohm: 13:29

Yeah, I think you were in a deal with.

Romano Muniz: 13:30

Yeah, it wasn't the deal that we were in, but essentially through the process they were able to broker off the cell phone rights or the tower for like 800 grand. So it's like if the building was 3 million you can automatically recapture some of the value. Kind of like with the industrial space you can go find scrap metal that's on the site. There's another one that we're working on now that we have an appraisal for 20 million just on the existing metal and copper that's there. So whatever the total value is, it's like. I almost see it as like how do you extract coupons out of these sites that most people don't see? And that's just the traditional ROI play. That doesn't include. How do we do cost segregation so people can look at the ROI or the coupons that they're getting on the discount, but now what happens when you actually apply it to your taxes too?

Michael Notbohm: 14:15

Well, I like to take full responsibility for your knowledge on cost seg. Yeah, I appreciate that, but so walk us through how that's changed your investment strategy as a whole, because you started with something I mean even just on the single family homes. People don't realize you can do cost seg on that, but now you're doing it on huge scale and what is? That enabling you to do that you would normally not even remotely be able to think about.

Romano Muniz: 14:38

I think with the economy the way it is today, repurposing things that people are freaking out and getting out on, meaning they might not be able to hold the debt service or maybe their mortgage has changed on it. Can we buy in an unconventional way, can we go through seller financing, can we find deals through assumable mortgages or, subject to where everybody else is like they're freaking out, we can go get a discount. I really think having some sort of criteria has been the key for us to scale and grow fast. Hence the bankruptcy. Top of the market, low market, getting 80% off ground up construction will make money tax free through the deal, before we ever put a tenant in there. And on those traditional houses, I look at it as can you monetize at least three ways? So there's the traditional Airbnb play.

Romano Muniz: 15:23

Traveling nurses was huge for us during COVID, but more recently I found out about traveling physicians and this one's like, I think, the honeypot. Essentially, you can do deals with agencies or health agencies. You can do deals with agencies or hospitals. They will pay you on an annual basis the same rates as Airbnb, whether they live there or not. So now you can go get hyper focused on how do I do ground up construction, partnering with the developer, make money tax free before you even put a tenant in. But now you're getting paid a high premium on an annual basis. You don't have the cleaning fees, you don't have the turnover, you don't have to worry about the algorithm on Airbnb, you just have stabilized cash flow.

Andrew Hoek: 16:04

Where are you doing those deals? Here Tampa, yeah.

Romano Muniz: 16:07

We're building a four townhouse, four bedroom, three bath, in West shoray right now and that might be a year to 14 months out. And then we've got two on Madeira Beach right now that are five bedroom, four bath, three car garage. And even with that, like I look at, can we take everything and do it at least three different ways. Have Airbnb or compliance changes. What's the model? Can you run it out per room? Maybe it's not traveling nurses, maybe COVID isn't such a big deal. What are the other demands? Traveling pilots, traveling executives, recruiting firms love that to be able to host too. So just a bunch of different ways you can kind of repurpose it.

Andrew Hoek: 16:44

You talked about partnering with a developer and I think you said doing it in the form of a rev share. Talk a little bit about that. What does that look like?

Romano Muniz: 16:53

This is not a plug for Mike, but thanks to Mike. I have a fraternity brother of mine from University of Florida who has a substantial amount of properties and he'd never heard of cost like before. So I kind of challenged him respectfully and said hey, man, you're buying at this rate, you're selling at a premium. But in many ways you're kind of on a glorified hamster wheel. You're constantly selling what's the tax look like? What if you held onto those properties? And then I essentially just put the math side by side. I'm like here's what you bought it for, here's what you're selling it for.

Romano Muniz: 17:25

If we partnered on it, here's what it would look like. We would get access to your funding because you have a track record of building out. Get a discount, but here's how it looks like to monetize it. And forget just the cash flow. But if you look at the cost seg side now, what do the numbers look like? Cool, do this for two, three, four, five years. Let's compare apples to apples. Which one's gonna give you passive income to actually escape doing this? Hey, if the market crashes, what's your options? We give him the whole cost seg playbook and the next thing, you know he's like I'm in Whatever you guys wanna do.

Michael Notbohm: 17:57

I mean, we tell people this all the time the rich don't get rich by selling stuff. They keep it you know, that's the bottom line.

Romano Muniz: 18:05

And we've never sold the property yet. The property we have in the industrial space will be the first property we've ever sold, because the whole cost seg side.

Michael Notbohm: 18:13

Then now it's a matter of what do you do next, cause now, like it or not, there's gonna be a tax burden on that one. Yeah, that's what you tend to do when it.

Andrew Hoek: 18:20

Go back to the question I asked you a minute ago because I wanna understand a little bit. So you're talking about and I wanna make sure I understand what you're saying when you're partnering with a developer on the rev share, they're actually doing the build out, right?

Romano Muniz: 18:32

Correct. Okay, so you'd be responsible for the actual land acquisition and financing. Okay, so that's what we did.

Michael Notbohm: 18:40

So they're just doing like a straight cost.

Andrew Hoek: 18:42

So they're building at cost for you.

Romano Muniz: 18:44

Correct this one was a little unique cause he owned the property already. Okay, once we explained the cost seg, we said what if we bought your partner out Cause he wanted to stay in? His partner didn't. But now that acquisition with the house and the land, we can use as the down payment for the construction loan. And if we try to get that construction loan on our own, they'd be like you're marketing guys, but because he has the track record in relationship, his rates, his relationship with the bank just made it move smoothly.

Andrew Hoek: 19:09

Yeah, and then you're working out some percentage, obviously with him.

Romano Muniz: 19:15

Right.

Andrew Hoek: 19:16

And that's on the longterm play, correct?

Romano Muniz: 19:17

Yeah, yeah, very good. So you'd have that percentage of ownership in the house, that percentage of ownership in the cost seg and that percentage of ownership on the cash flow moving forward.

Andrew Hoek: 19:27

Okay, you brought up financing there and I'm curious to talk about that a little bit too. So where are you seeing success with lenders? Is that localized? Is that national lenders? Is a private money? What does that look like for you?

Romano Muniz: 19:44

So in the beginning it was all of our own money. Okay, so we'd buy things cash outright, like the houses in Buffalo that were like 25,000. Mm-hmm. And then we do a refund. The back end, as we grew out of it and started going for bigger properties Bankruptcy deals you have to buy 100% cash, that's. There's no option on the lending side. However, on the industrial side, saw the process, saw the opportunity, realized you know we don't have eight figures sitting around. So two things One, we started real estate syndication and raised capital through friends, family, business partners. And then on the back end, we realized the sellers needed to hold the note. So we did seller financing with them. So, instead of the traditional play, it was way easier and way less paperwork. It was a win for them, so they didn't get taxed on short-term gains. Sure, it was a win for us too, because we can kind of secure the deal without having to go through all the back end treasures of traditional banks.

Andrew Hoek: 20:34

Yeah, okay, so you brought up syndication. Let's talk a little bit about that and your segue into how you've gotten involved with that. What's it look like? Who are you going to? Obviously, you're bringing in some counsel, I'm assuming, with that.

Romano Muniz: 20:49

Absolutely so. As we're going through the process of a traditional primary house, short-term rental, commercial bankruptcy, I realized, if the process is the same and we didn't have access to capital because we were just tapped out internally, I studied, studying who are the big dogs out there, all the big names that you see online. How are they actually getting it done? And the more I saw their buying power, I realized it's all a leverage play. If we've already kind of leveraged what we had internally, I realized they were doing it through syndications or some sort of crowdfunding. And through that process I was just trying to figure out like well, what the hell does that actually look like? How does it work?

Romano Muniz: 21:24

I interviewed a gentleman here locally that was involved in either 15 or 18 different syndications and I just drilled them on questions. When you got into the syndication, what do you love about it? How come you passed up on other ones? What were the kind of criteria that made sense for you? And as you broke it down, I realized the more you had to evaluate, the more likely sophisticated investors gonna kind of compare it to everything else. So when we started it, we probably had a 30 day run to go raise the money.

Romano Muniz: 21:55

I thought, man, if we could again go back to what everybody else is doing, do the opposite, how do you get rid of all the fees? How do you get rid of the legal stuff, All those charges that end up taking out 15 to 18%? Can you do the rev share deal in their favor? And just simple answers to get yes. And so that's essentially what we did, and I also combed it, went by him first and said, hey, have you ever compared this to the other 18? What does that look like? Obviously we've got legal counsel. I think we interviewed 15 different SEC firms across the country, went with the one that we thought made the most sense and they've been wonderful. But that was a learning curve in itself, Because you got an offer on the table trying to figure out how to build the syndication. You got SEC. We're doing it in the US and in Canada. So it's a whole different playing field too, Because there's no room for errors. That paperwork is serious and, you know, got me a little nervous going through that process in the beginning.

Andrew Hoek: 22:47

Yeah, that's a steep learning curve. For sure, those SEC people don't play.

Michael Notbohm: 22:51

No, that's right, be on an episode of locked up abroad or something Ramona crossed the border after having the wrong paperwork for a syndication Even at the time of figuring out like all right, what is this subscription up?

Romano Muniz: 23:02

What's an OM? What's the Know your Client? All right, how does the wires work? I mean, you're drinking out of a fire hose faster in that time, sure, but ultimately it's the same idea of if you're doing it with a you know residential property and you're raising money for down payment. It's the same process, as just most people won't take the time to figure that out.

Andrew Hoek: 23:19

Your, your BK deals are you? Are you syndicating those as well?

Romano Muniz: 23:24

Now, those, those we did internally. Okay, it's funny because in the online space we generate bankruptcy leads and I've been telling all the guys in our space like you can keep sending out bankruptcy leads and get them, or you can cherry pick them and use them for yourself plus the, you know, cost segregation side and just kind of waking guys up to realize, man, there's far more value than a quick arbitrage plan to lead. Yeah.

Michael Notbohm: 23:46

Have you done any wholesaling on like these bigger commercial deals?

Romano Muniz: 23:50

Residential, yes, commercial now.

Michael Notbohm: 23:52

Because that's I mean we keep hearing. I mean you've got a client that you've worked with.

Andrew Hoek: 23:57

It was just ridiculous, yeah, I had a client that he was buying a. It was a large strip mall with like a Lowe's or Home Depot I mean it is the anchor and some other smaller stuff and he was. He bought it for like 13 million and there was a wholesaler in the middle that had had under contract for like 11 million, so they made a $2 million spread on on that deal, yeah Some paperwork Right.

Romano Muniz: 24:23

I know a guy, you know a guy.

Andrew Hoek: 24:24

Yeah exactly.

Michael Notbohm: 24:24

You want this piece of paper, but I am hearing more and more about that.

Andrew Hoek: 24:27

I was saying we were having a conversation. I'm sure the one of the attorneys that works with me kind of on a contract basis he's he's gotten involved with some group and they're they've got a couple of properties under contract right here on Kennedy that they're doing that style with oh nice.

Andrew Hoek: 24:42

And and he kind of brought the same thing up as he was like you know, he's newer to it than the group that's running behind it, but your conversation about out of zero to the back is exactly what he said too. He was like you guys are wholesaling these things, let's look at how we add a zero to it, and that's kind of how they're getting down on this path.

Romano Muniz: 24:58

Yeah, it's funny because I go back to the criteria. The very first property I wholesaled to a developer, I remember looking at the house thinking, god, good thing we got this deal done, because I don't have the vision for what this guy's going to do with it. Yeah, well, fast forward. When he was done renovating it, we went to the housewarming party and I happened to look at him like holy cow, there's a four, two downstairs. There's a private entrance to two, one upstairs. So we ended up working in the deal where I ended up buying it back from him. He treated me like the realtor, took that off of it and this was March 2020, right when COVID happened. Okay, so before we ever moved in, I had a tenant upstairs running it out and ever since we've lived there, we've never paid a mortgage on it and to this day, even when we moved to St Pete, I still have it running out upstairs and downstairs.

Andrew Hoek: 25:43

Nice, yeah, it is funny when you say that about the people who have some of these visions that I certainly don't have. But you turn around and you look at some of these things and you're like man and I actually I don't mind the.

Michael Notbohm: 25:54

I actually like the design part of these flips, but I feel like the nagging wife and he's like the husband when we go to Florida core, because I'm like what do you think about this? Tali's like dude, I really don't care.

Romano Muniz: 26:04

Yeah, it's a cash flow yeah.

: 26:05

Like can you just buy it already?

Michael Notbohm: 26:07

I'm like well, we got to compare it to a couple others.

Romano Muniz: 26:09

I'm like man, I sound ridiculous. That is not my sweet spot. I can figure out the resources and bring things together, but when it comes to that side, that is definitely not my gift set.

Michael Notbohm: 26:17

I think it's just fun because I like what you just said. Like you get to the end and you're like where we started, where it is now. It's like this is really cool, it's awesome. Now I do wish I don't want to be the guy in the trenches like doing the tile. I kind of wish I knew how to do a little bit more of that, because it's like you see a transformation like this and you're like I actually didn't like screw in one single screw in this house.

Michael Notbohm: 26:42

Andrew always hit our key to success, and I don't know if we should share this on the podcast or not, because everyone's going to use it.

Andrew Hoek: 26:49

That's right.

Michael Notbohm: 26:50

Well, you just said gift, yeah, gift, but right before we have an open house he goes over with a Swiffer and does like one thorough mopping of the floor under contract the next day. We're like six for six on this?

Romano Muniz: 27:04

Yeah, it's all perception. Yeah, we had one that was on the market for like two weeks.

Michael Notbohm: 27:08

He's like dude. I probably need to go over and mop.

Andrew Hoek: 27:10

I was like, yeah, I think so. It's a little mental therapy.

Romano Muniz: 27:13

You know you get to zone out for a bit and sweep and Swiffer and if it's a placebo effect, so be it. It's closing, it's closing.

Michael Notbohm: 27:20

Yeah, listen, I don't know the science behind it. I just know it works.

Romano Muniz: 27:23

That's awesome yeah.

Michael Notbohm: 27:25

So what do you say to people that want to be ambitious like you? I mean, you're doing a lot of things at a very high level and you know. Just even talking through the industrial deal, you're like I had to get the SEC guy. How do you know even where to start? What do you attribute that to?

Romano Muniz: 27:41

Man, if I was starting all over again, I would either team up with somebody that's doing it because I think you can learn a lot faster by working with somebody that's already in the real estate space. Wholesalers, like just finding, like, instead of trying to figure out the whole process, just find one area that you can add value. Like the developers I initially met with, I realized, man, they're really good at developing. The biggest takeaway for them that's sucking at their time is going to find the properties. I'm like, man, if I could just take care of this one piece.

Romano Muniz: 28:09

Then I started realizing, man, all these guys that are wholesaling, they're in this weird negotiation phase. They don't like to negotiate so they give up on it. Where I'm like, if we could streamline that and not negotiate and just do a pre-degreed terms, hey, I know what your margins look like. You've kind of educated me on it. Now you can just introduce them direct. In the beginning, I mean, I was just driving through neighborhoods. It's not like I perfected. Going on MLS, I just thought, hey, here's Honeypockets in Tampa, what's got the biggest property line, what I think has the most upside value with growth. And then Dumblock found this property that nobody had picked up for like four to six months, which seems rare nowadays, right here I was thinking.

Michael Notbohm: 28:47

Luck, though, is really like hard work meets opportunity. It's not really Dumblock if you break it down Like the effort that you put in. I know we've talked about this, but have you ever read Mamba mentality?

Romano Muniz: 28:58

No, I haven't Not yet so you got to read it.

Michael Notbohm: 29:01

It's Kobe Bryant's book and really goes through his life. You got a guy who's ridiculously talented and yet his logic and his mentality was I'm good, but in order to be the best, I have to not just rely on my talent. I have to work harder, twice as hard, three times as hard as anyone else. So he would wake up and he would have two workouts before his kids would go to school. He'd get his kids to school, then he would go to the normal practice and he's like so over. Extrapolate that out for five or six years, he's getting 10 times more than everyone else is willing to put in.

Romano Muniz: 29:39

And I think that.

Michael Notbohm: 29:40

That's really always stuck with me. Like you know, the best guys in the world Michael Jordan, tiger Woods, kobe Bryant they're shooting 5,000 shots. Before they leave, you know everyone else might already be home. They're taking those extra free throws, they're doing the extra drills, and so you can't rely on just talent. You can't rely on oh, I learned this from a mastermind and I'm just going to walk into these crazy opportunities you got to be willing to work. It sounds like that's what you're doing.

Romano Muniz: 30:09

I think the other thing too is if somebody didn't know and they're intimidated by it.

Romano Muniz: 30:13

Sometimes you hear the idea of oh, gotta go to a mastermind, I have to spend money or I have to get tied up with a Michael or Andrew.

Romano Muniz: 30:19

You know that talk about you're the average of the top five people you spend the most time with. I think the other alternative to that is you are the average of the top five people you listen to. So if you're driving to work every day or driving to drop your kids off, even if it's 10 to 15 minutes, if you had that almost as like on autopilot to listen to some audible constantly conditioning and fill your mind on how to do it. Or when I found that property to wholesale, I was scheduling calls to do kind of basically beating sales calls, but while I was on them I was hitting the streets. So I think, being efficient with how you like really do an audit of your own time and like how you can fit it in, because we all have the same amount of time every day. It's just are you how intentional are you about really making it happen, or is this just a dream that you're Looking at for it from others perspective and see what they're doing, or you know? Do you actually want to schedule and get it done?

Michael Notbohm: 31:07

Yeah, do you want to just compare it, because you think that's like what the dream should be?

Romano Muniz: 31:12

right and a lot of people love to sit in that I wish or so-and-so is doing this and that, and it's like it's just constantly a comparison game as opposed to like what are you actually gonna do about it. And the longer you spend looking at everybody else's time spent making it happen, it's just that much less time that you have to actually enjoy it for yourself.

Andrew Hoek: 31:31

Or we were talking about something the other day and I said this is the the unglamorous side of real estate. Yeah which has felt like a lot lately Dealing with the city. Yeah, I mean there's, there's a contractor. It's not what you see, when you see the, the perception of, like you know all these real estate moguls or whatever, you never see the hardships. But man like that, when you're digging the trenches to do it, it's dirty.

Michael Notbohm: 31:57

Well, we just finished a house like a week ago and this is the one we've been battling with the city on, but I remember I think you called me we had negotiated with the tenant who was on a month to month but didn't want to leave. We're like do we really need to go through this whole eviction process? So they didn't have enough money to get their next place, so we gave them a thousand bucks to leave.

Michael Notbohm: 32:19

And he went to the house and they had taken all of the window units out and then Took a dump on the top stair and I'm like this is so ridiculous.

Romano Muniz: 32:30

Thanks for the money. Yeah, I love to party. Thanks for helping us.

: 32:34

Here you go.

Michael Notbohm: 32:35

And I always laugh because that's like when we talk about the non-glamorous side.

Romano Muniz: 32:39

It's so true, man, you know, tyler, and I use this all the time as kind of a Just a phrase that we sit on. In the end They'll say it's easy because from the outside and you know, looking backwards, man, this looks it's been awesome. Right, we've been doing a lot fast, it's been scaled, but, like even when we were doing the syndication, we had to go raise roughly ten million dollars in 30 days. What people don't know is they didn't see my spreadsheet of 254 names. They didn't see it broken down by EST, cst, mountain time, pst. They didn't see when I was flying back and forth to Texas, got my car locked in Orlando take an Uber to get it realize my car is locked there. I'm like all right, well, I'm stuck at the airport for three hours and it's 10 o'clock at night here. Who's available on PST? So I'm like just being that wildly dialed in.

Romano Muniz: 33:25

I think there was a Seven day time period where I did, or eight day time period where I did three over nights to just make sure we raised it and got the deal done. I used to tell my I mean, like psycho, I would stare at the mirror and say, hey, if you don't get this done. Do you feel like you could ever earn the right to be in this space? Hey, could you let your partners down on this? I just had to like gamified a bit, but that's the non-glamorous side, that's the yeah mama, mentality side that nobody really sees, and then they just see it as kind of done. That's the real, though, right.

Michael Notbohm: 33:53

That's the real well, real estate is is easy, it's simple, it's not easy.

Michael Notbohm: 33:58

Yeah you know, I think that that's definitely something. It's not like you have to reinvent the wheel. There's so many different ways you can make money, but one it's being intentional about figuring out what am I gonna do to make money and then taking action on it. I don't have to reinvent the wheel, like we don't have to come up with the next Twitter or Instagram or Tik Tok, I mean yeah literally, you can just copy what what people are doing at a very high level and to your point earlier, there's always enough Available.

Romano Muniz: 34:25

You know, and even now, like when I look at some of these opportunities, I don't think there's any shortage on the industrial side of anything. I've realized. How can I be more intentional about solving Bigger problems? How can I solve people's tax problems? You know that whole conference we did recently with what we brought, time will write our as man. If we can just solve people's tax problems, then you can earn the right to having access to different capital, as opposed to being like here's my fancy deck, here's my ROI, here's my unconventional way. I feel like if you solve their pain points first, it opens up a completely different door to getting access to money.

Andrew Hoek: 34:58

It's a really good point. Never thought about it that way, but I mean, if it's like we're, we're showing you easy access to additional capital now Invested with us. Yeah, yeah that's really smart. So I'm curious, and now that you're doing more and more real estate, how are you dividing your time between that and the motto?

Romano Muniz: 35:16

I mean it's, it takes a bit of effort. I think one of the things we've really been looking at is, if we look at every part of this deal of how do you source it, what's the financing look like, what's the operational side? We're looking at kind of building it out to have the ops side done, where I can have more FaceTime on opportunities, mm-hmm, and then making sure that we're partnering. So it's almost like the idea earlier hey, are we giving more value away? The best way that we can get our time back is how do we partner with all the experts who are the guys that are building in the industrial space? How can we give away points to you know developers? Because then it's way easier to actually get it done and it frees up our ability to just go focus on scale.

Michael Notbohm: 35:54

Yeah so the syndication space is one of those where it's like you know, what can I accomplish with a lot of people being involved, versus if I'm just gonna be greedy and I want this whole deal myself. Right, you're gonna grow so much slower unless you just somehow stumble upon a home run and you've just got a ton of equity. That happens overnight, which you know it's not like it never happens, but it's very rare where a syndication is pretty.

Michael Notbohm: 36:19

I mean, it's a tried and true model. Right, you can. You can rinse and repeat it.

Romano Muniz: 36:24

Just bring value to those people that are investing with you and you'll have people for life and we've been spending more time with folks in the family office space too, to really understand what they invest in, how they invest, or Go back to the whole tax play. Who has real big tax problems? Can we show them, like even the guy that work, when now he may have had nearly a hundred properties but he'd never heard of cost segregation before. So it's like if you can just add value, educating them in that way, you might not need this indication. We have one group now that's looking at putting in Multiple, multiple, eight figures, but the reason why they're willing to do is because the property has an opportunity zone. They just had a big exit, so if they can hold the deed of trust and minimize 20% of their cap gains, that's a huge winner for them.

Romano Muniz: 37:07

I mean it's a eight to ten million dollar savings for them.

Michael Notbohm: 37:11

And defer it for what? Two, two and a half years yeah. So yeah, so what do you see, as we're? You know we talk a lot about. You try to bring value from always positive, but reality is there's also you got to protect yourself from what could possibly have happened on the negative side. So what is you know what's kind of your overall global forecast for real estate in the next 12 to 24 months?

Romano Muniz: 37:37

Try to acquire as much as possible and hold all of it. I think people that are gonna do a wholesale it feels good and see easy entry. But man, I would try to hold everything because I look at the market as a whole of it's almost vaporized. Folks that got in a couple years ago that are sitting at two, three percent don't want to move. Folks that want to get in are stuck because they can't find as many properties.

Romano Muniz: 37:56

Then there's this in between of big groups, like a black rock that bought a bunch of rentals. You have Airbnb taking a big part of the market. So I Think it for folks to like really start to scale this out and be successful, I think they have to get creative on seller financing options the assumable mortgages that you can basically take over Somebody's property that got locked in at a two or three percent, get some sort of bridge loan to finance it. Or this is not an area I've spent much time in, but the idea of the subject to properties. I don't know if that's something that you guys have focused on or done, but it's an area that we're looking into now too.

Andrew Hoek: 38:32

Yeah, I'm seeing more and more of it on the legal side for sure, but I I still it's. It strikes me and we haven't done any that on the investment side, but it strikes me kind of as a Um, it's not well understood outside of small circles, which I think is an opportunity right, Totally.

Romano Muniz: 38:52

It's just a matter of explaining it correctly, and so are the people who are doing it, the guys that have done it, really well is, instead of being like we're taking over your loan and that's just it, They've used the phrase um, credit restabilization, so they'll end up putting it in a trust they, instead of being like, oh, we're taking over your property, they'll pitch it as more of a scarcity play hey, if you qualify, we'll see if we can go. You go through our credit restabilization process and see if you qualify to be, you know, subject to people want what they can't have. So it's been an easier way for them to kind of make the transition, as opposed to we're taking over your existing loan and you know what's the what's the end for you.

Andrew Hoek: 39:32

Are in those scenarios. Are they running back to these people?

Romano Muniz: 39:36

No, no, they're. They're basically taking over their existing property now. So a good example I've heard of recently was let's say, somebody moved here from California last year. They got the house. Turns out they have to go back. Maybe or maybe doesn't make sense for them to sell it because there's not enough equity or you know the cost of transaction with real estate side. Maybe they don't want to lose you know the 6% so there might be opportunities where they'll take over the existing property. A new buyer would take over the existing property without them being down on it overall and you can do some sort of creative financing and maybe you sweeten the deal, give them a thousand bucks.

Romano Muniz: 40:12

Maybe you leave some poop on the property, like those guys upstairs.

Michael Notbohm: 40:15

Yeah Well, let's kind of wrap up with this, because one of the things that we always like to talk about and I know this, this is something that means a lot to you but just kind of how all this stuff really ultimately is about legacy, about building wealth. You know, doing these things, that that you know the glamorous and the not so glamorous day to day in order to build this generational wealth. So what do you envision your legacy being?

Romano Muniz: 40:37

So the background that most people don't know about me is I never wanted to go to college. I was going to be a full-time missionary. I went to Ghana, africa, haiti or sorry, mexico. I used to live in the inner city of Tampa working for the dream center, and so I had a high school teacher that basically said hey, go get your education, understand, you can make an impact later on. Fast forward to today.

Romano Muniz: 40:58

I always think about what that legacy looks like from a family standpoint. But you know we're doing those type of projects are going overseas. I realized it was some sort of rally of raising money do a good cause. It may stay around, may not. So my focus now with real estate business you name it is how can I inquire? Require properties that are cash flow positive, that can go support organizations like that, so it's actually a sustainable asset to support it rather than here's a one-time donation, good luck. And so you know I've been looking at a lot of opportunities on how can I essentially be the Robin Hood, if you will, to support those initiatives where it's not just a one-time donation or that organization goes away? Do I have an asset that can spit out and redeploy to somebody else so they can far outlive what I'm doing, or my family, you know. Push it through trust and there's actually a substantial legacy value to it that's sustainable. Rather than you know, we did good and we got a tax right off of the end of the year.

Michael Notbohm: 41:56

That's powerful.

Romano Muniz: 41:58

And that's the whole where I get the phrase to serve those who will never meet, because I realize there's folks that are in the field that are making a wild impact that we'll never see. And if I'm not the guy for that to be, that if I can just be the catalyst through capitalism that's sustainable, it's a win-win for all.

Michael Notbohm: 42:16

Yeah, give them the resources they need. Yeah, well, how does that relate? Then, taking it a step further, because now you're a dad, so what does that mean for your kids?

Romano Muniz: 42:28

Man. It's an interesting dynamic of trying to manage, like how do you don't really come from anything to give them the opportunities that you want but also keep it in check? I'm teaching my kids now all about finances. Even when we drive down the street I'll look at apartment buildings. I did this with them when they were like three years old. I'd say, hey, is that a house or apartment? And they go an apartment. I said, do we rent or do we own? They go, we own. I said, why do we do it? And they always were a buttle back. Even to this day, they go for the cash flow, baby.

Romano Muniz: 42:59

And I love it because it's like man, if I could just show it through simple application but they remember it and then kind of earn the right to share it that way. But also teach them like, hey, we got to be in a position of ownership, go serve and go travel these places so they still have that level of humility. But understand, all this was not really for you, it was kind of a tool. Like you are, you're responsible to serve others through this. This is a blessing, to be a blessing, and so I want to teach them that early on.

Michael Notbohm: 43:26

It's crazy like how little financial literacy is taught, oh yeah. You know, and I think it's I mean part of it what I think is by design right, because it's like if you have a bunch of financial literate people, you can control them a lot easier. Unfortunately, that's the reality we live in, but I think it's our duty as successful business owners to be the person that's teaching anyone around us financial literacy, because it's not a really difficult concept.

Michael Notbohm: 43:53

It's just one that's not taught, so you don't even really know about it Just being wildly intentional about it.

Romano Muniz: 43:57

You know, and even now, my son just got into Pokemon cards. It was not the thing I wanted to do, but even having the conversations of like what's the value look like, how are you going to trade that? What does it mean? It's through a fun format, but at least it's just like conditioning them early on to start to see the perception of value and how you make decisions on things and slowly earn the right to do it through real estate. I bring them to the properties as we're developing. Hey, here's why we're doing it. We got this property. Hey, this well, like, I'll go collect rental checks too. Hey, we used to live there, cool. Yeah, now we have somebody else living there. Why are we doing it?

Andrew Hoek: 44:29

Yeah, that's great, I love that man.

Michael Notbohm: 44:34

I think we covered some good stuff today.

Andrew Hoek: 44:36

Yeah, definitely. Thanks for coming on, man.

Romano Muniz: 44:38

I really appreciate you guys having me again.

Michael Notbohm: 44:40

Romano Robin Hood Munez.

Romano Muniz: 44:41

That's right, take it.

Michael Notbohm: 44:43

Until next time onward.

: 44:46

Thank you for joining us for another episode of the Legacy Wealth Code podcast. If you enjoyed this episode, click subscribe now and never miss an episode Until next time onward.