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Real Lives of Real Estate w/ Brendan Da Silva
Welcome to the Real Lives of Real Estate, a brand new real estate podcast unlike any other. Your host is the #1 Realtor in Newark, NJ, Brendan Da Silva, and every week he interviews real estate professionals about how working in the industry has affected their lives and stories.
Real Lives of Real Estate w/ Brendan Da Silva
Chris Stout on Real Estate Strategies & Life's Big Decisions
From the heart of Staten Island in the 70s to the aftermath of the financial crisis in 2008, Chris Stout and I share a tapestry of tales that weave through the fabric of real estate history. We uncover the rich diversity of backgrounds leading into the industry—from the mechanics shop to the firehouse—and how personal histories and life-changing events like unexpected pregnancies carve out our investment strategies. Chris, with his profound knowledge as a developer and multifamily syndicator, illustrates the high-stakes world of zoning laws and the patience necessary when contending with infrastructure challenges.
Marriage, money management, and the pivotal influence of trust and expertise in partnerships—Chris and I open up about how these personal dynamics play out in both life and business. We navigate through the struggles of financial literacy within families, where differing views on money can spark challenging discussions, and how sharing responsibilities can lead to a harmonious balance in marriage. Meanwhile, the podcast peels back the curtain on real estate success stories, where naivete sometimes paves the way for the most lucrative deals, and strategies like sending checks to homeowners redefine property acquisition.
Finally, we tackle the pressure-cooker of real estate investment, where managing investor expectations and the stress of borrowing money can test the strongest of relationships. Chris gets candid about the toll it takes, yet celebrates the support systems that form the backbone of successful ventures. We also discuss growing and managing a business with the goal of scalability and sellability in mind, sharing insights on the importance of systems, top talent, and having a clear vision for one's career and legacy. Join us for this heartfelt exploration into the world of real estate, where business acumen and personal anecdotes meet.
To get more insight on episodes and to apply to be on the show, visit www.BrendanDaSilva.com!
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You know what's good about your business compared to mine. Everything I do is long money. Like so I just signed a contract on a deal in Long Branch that I'm going to build eight $1.5 million houses and I'm like, yeah, you know the trouble with that. The promote, that's where the money's made for the fund manager. That's at the end, five, six years down the road. So I'm always setting myself up for long money.
Speaker 2:Get ready for Real Lives of Real Estate, where the world of real estate meets the essence of your life. Buckle up as we unravel stories, homes and the heartbeat behind it all. Let's dive into another episode. I hope you share and are encouraged. All right, I am here with Chris Thout, developer and multifamily syndicator. I said it right, yeah, yeah, yeah. And a new friend to me. I was really funny enough. Actually I was telling you before, but I follow you because you built two. I remember the first video actually I watched yours on Instagram.
Speaker 2:It was you built two, two families in Staten Island, I think yeah and the reason why it was so interesting, because I had an opportunity to buy a 50 by 100 land. I'm like, oh, I'm gonna build a three family. Yeah, I think three families the way to go. But then how would you mind just talking real quick about that one, because I was always interested yeah, so within Sten island you have a lot of different zones.
Speaker 1:A lot of majority of the island does not allow three family oh, okay so basically most of the island, staten island, is one and two family buildings.
Speaker 1:You have some zoning in staten island. That, and the way the zoning actually works out, is pretty funny. There's some very densely zoned areas down by, like the ferry, so it'd be, I should say, up by the ferry, northern side of Staten Island. So it's zoned properly for nice big, tall buildings, multi-families, all this but the actual the area, the sewer system in the area, can't handle it. So you would be able to get zoning approval but you couldn't get approval to hook up to the sewer. So what do you do? You gotta wait, okay, yeah, so so you have to wait for the city to upgrade the sewer system. That could take years, you know.
Speaker 1:It could take forever okay, yeah, okay, that's crap, yeah, literally crap, yeah yeah, I mean you know, listen, there's a lot of areas in real estate where you're like this is gonna go like well, when?
Speaker 2:well, I don't know but it's gonna go it's gonna go it could be a hundred years we're in newark right now, right?
Speaker 1:so my brother, I am 40, my brother is 56, 16 years older than me. That's a big gap. Yeah, my mother said, I'm not an accident do you believe it? Uh, I actually think I was a. I think I was to save a marriage oh wow, yeah, I think powerful yeah, so, but it's fine if I was an accident.
Speaker 1:that's fine too. Yeah, hey, you're here, listen. I had a great childhood my parents growing up, everything's great, so I have great memories of growing up and all that. So, um, my brother, who's 16 years older to me, took a very similar path than I did, basically on his career journey, always involved in construction a little different from me.
Speaker 1:I. I started as I started. I'm very mechanically inclined so I could fix anything under the sun. I can't throw a football to save my life, I'm horrific at sports, but I can fix anything. So when I when I started, I was in auto mechanics I love working on cars and then that later pushed into home and like remodeling and renovations and all that further than real estate and I enjoy the numbers and all that. But my brother basically started in new home construction with local builders in Staten Island and those guys were all taking their money to Newark. So I talked to my brother a couple of times a day. We have that kind of relationship. So I told him I was like, oh, I'm going to Newark later for a podcast and it always comes up. He's like like the joke is is like when's Newark going to turn? 30 years ago it was ready to turn.
Speaker 1:So in Staten Island you have Bay Street. When's Bay Street going to turn? It doesn't make any sense that Bay Street hasn't turned yet because it's right next to the ferry, which is right across from. Manhattan. You know why hasn't that area turned yet? I don't know. But anyway we got on that from Staten Island. Zoning in that area is zoned for the proper buildings. The sewers are not. Well, the infrastructure is not ready for it.
Speaker 2:Yeah, it's funny here in Newark the infrastructure is ready, Like the city, planning is. Like you, we're kind of it's not too congested. But I will say you always got my ambulance and several people.
Speaker 1:I think it's great. I think it's great, you know, we're here, we're here, yeah, we're not lying, we're here in Newark, we love it.
Speaker 2:I was just telling Chris. I live five minutes away. I hear the sirens all day. Yeah yeah, it's all part of the city life.
Speaker 1:Yeah, if you want quiet, there's somewhere for you to go. This is not the place.
Speaker 2:Yeah, there's so many quiet places.
Speaker 1:New York's, not one of them. Yeah, yeah, yeah.
Speaker 2:Unless you find like a meditation pod or something.
Speaker 1:Right, right, right. Like noise cancellation, Right Go out in Pennsylvania and pay a thousand bucks an acre. Yeah, literally right.
Speaker 2:Let me ask you a question. Not know you were a firefighter?
Speaker 1:yes, you always said you were a auto mechanic, so you were auto mechanic as a firefighter. No, so the auto mechanic thing actually started when I was like 16, 17 I started a little business out of my mother's house and I would change like my big thing it was. It was my. It was a hundred dollar brake job. You need brakes on your cars 100 bucks, didn't matter the car, hundred dollar brake job why was that such a big thing for you?
Speaker 1:uh, everyone needs brakes, okay, and I know how to change them bang bang yeah, didn't need too many tools, that's true, and they would drop the car off at my mother's house. I was cheaper than the mechanic, it was very convenient and it was very convenient for the people and and I just loved working on cars. So then I started doing know I'm saying bigger and bigger projects on cars, but more in-depth type repairs, transmission yeah.
Speaker 1:I actually never got that far. Okay, but like starters, alternators, you know, maybe some minor electrical problems, suspension, I would do it all out of my mother's house. So that was when I was in my late teens. I became a firefighter when I was 22 and I've actually, until I retired now I, oh you, finished your firefighter.
Speaker 2:I finished.
Speaker 1:I went full cycle on fire department.
Speaker 2:What? Who does that? Why did you do that? What's that the benefits?
Speaker 1:I got everything.
Speaker 2:Yeah, I guess you're already wait. So you were wait, wait possible possible. So you grew up in Staten Island. It sounds like you grew up in a single family. Yep. I'm imagining you guys used to play in the street with your neighbors, Dude exactly that.
Speaker 1:Dead end semi-attached home in Staten Island. My parents paid in the 70s, I think. I just asked my mother recently. She paid $38,000 or $39,000 thousand dollars and you know something I actually like to talk about and I didn't. You don't realize the struggles your parents go through I don't think most people don't, because kids are just living their life. So I asked my mother recently, because everyone says now like oh it's so hard now, it's so hard to do it now yeah and I asked my mother recently I'm like mom and I asked her how much she paid.
Speaker 1:She remembered it very quickly and clearly so she moved out of it with my father moved out of, who just recently passed. They moved out of a two bedroom apartment in Queens into the semi-attached house in Staten Island. We could all agree that a semi-attached house in Staten Island is for. Could all agree that a semi attached house in Staten Island is for the middle class person, yeah.
Speaker 1:So I said, hey, when you paid, you know, 40 grand ish for the house, was it hard? And she said I can remember it like it was yesterday I was we were extremely scared. We had to use your Aunt Lillian, who's my mother's sister. She died many years ago. We had to use Aunt Lillian's furniture to put furniture in the house because the house tapped us for everything. And she said I was so scared all the time that we wouldn't be able to pay our mortgage after we closed. She says obviously, as time goes on it becomes easier because income goes up and mortgages don't you know. Hopefully, over owning some, over a period of time, it gets easier. So she said but I remember, like it was yesterday, how difficult and challenging it was at the time.
Speaker 1:And I'm like that's interesting because you would be like in a middle class ish. At the time we didn't grow up with a lot of money, but you know middle she, you know you should be able to afford a semi instead and it was very, very difficult then in the 70s. So just funny when people say like, oh, it's very hard now, like it was never. When was life a walk in the park? Like when did that exist?
Speaker 2:can you name a time? No, I don't think so. Yeah, that's why it was always hard, I think this shit is hard.
Speaker 2:Yeah, it's all we love to curse here, yeah yeah, I think I actually think you're making a good point. I grew up actually very interesting, so I often look back on my childhood. My brothers and I we just came back from a trip my two brothers, my sister and our spouses and it was extremely, extremely interesting to me because we always talk in our family. Growing up, we did have, relatively to the rest of america, a very challenging upbringing. We were evicted multiple times by. We lived in my dad's store. It was four of us to one room.
Speaker 2:I mean my dad had a back like warehouse where he would do like screen printing yeah so I literally, for like a year or two, three years, like had the fumes of the screen printing. It's a very distinct smell. Yeah, anyways, the point is we always like have like almost like a chip on our shoulder right, like a badge of like not honor, but like this is not hard. So when people talk about like oh, I want to be financially free, you know financially free is like it means different things to different people yes so I'm like we were financially free when we had like the rental we could pay.
Speaker 2:That was our vision of like we're free yeah, right, we can pay this yes we have like two months in advance someone's not knocking on the door today.
Speaker 2:Yeah, we're like solid, so with that being said, I'm like man, we really struggled. Now I bring that to my mom. Mom, you know I don't know how you did it. You know, really struggled, it was easy. Like my mom won't say it was easy. Like she'll say, yeah, it was hard, but we had it so much. You guys had it so much easier than I did my mind. I'm like mom, how was that even possible?
Speaker 2:yeah, yeah and she's like, literally, she told me a story that what? This is a long story short, but her and her two sisters and her brother, my grandmother's cooking apparently wasn't that good and they would take some of the food in brazil and they would put it in like these, um, these dolls, right, like that, we'd pop the head off the doll, put the vegetables because he couldn't leave the table. So everything was eaten, yeah, so they would put it there a few days, go by, a week goes by, next dinner, right, and they're doing this every day because they figured out the hack.
Speaker 2:We don't need this food anymore sure they come home for dinner they sit down from school. Nothing's at the table. My grandmother's like okay, now it's time to eat. And my mother and my, my aunt, are like where's the food? Yeah, how can we help, because we gotta start cooking. And um, my grandma's like oh, the food's in your room. They went in the room and said, oh, food's not there. He goes, no, gary, your dolls, bring the dolls here.
Speaker 2:And my grandmother made them sit and eat weak old food oh wow, like spoiled mold, didn't matter eat it and they sat down to eat and they got sick and my mom said, like that's how I grew up wow so for you guys like you guys are like almost spoiled in my mother's eyes. It was kind of like that yeah so I. But it is funny because to your point it's almost like a like a celebratory thing to like feel bad for yourself.
Speaker 2:It really is like yeah I have it harder than anybody else like you guys. Don't show I'm going through. It's like wow, this generation is the most difficult generation by a house in america history ever. It's like well, everything's hard everything's hard everything's hard you know.
Speaker 1:I think it's important for people to know that everything is hard for everybody because it's so easy to look at someone who did something and say, oh, that guy has it easy. The amount of pressure that someone went through like we're sitting here at, what would thing? This is like a Coppola.
Speaker 2:Coppola. Oh, this is like a turret.
Speaker 1:A turret. We're sitting in a turret in Newark. I can see the whole city.
Speaker 2:Yeah.
Speaker 1:And I could see these tall buildings that I'm surrounded with and people forget that the amount of pressure that someone went through to put one of these buildings up. But then they'll just go look at their mansion and say I wish I had that. It was so hard for that guy to get that.
Speaker 2:Yeah.
Speaker 1:So I heard something from you. Know you follow Alex Hormozy, Mm-hmm, so I heard from him real hard work is not going out and digging with a shovel in the ground for 12 hours a day. That's not real hard work. Real hard work is doing something day in and day out, without certainty that it will ever pay off.
Speaker 2:Yeah, that's the hardest work. That's the hardest work Because you know what?
Speaker 1:I know that's true. Listen, I've started from the beginning. So I started doing my own renovations, carrying drywall up staircases. After the auto mechanic life yes, so this would be the start of my real estate career.
Speaker 2:This was during the firefighter.
Speaker 1:Yes.
Speaker 2:Why did you start? Why not just stay as firefighter, like a lot of guys do? Why go into real estate at all?
Speaker 1:So I had much bigger aspirations for myself. So as a fireman I could tell you when I retired I was making. When I went in the salary starts at like 50 something thousand and then it stabilizes about a hundred and then I later got promoted and I think I finished off. My last year was like one hundred and fifty five thousand. So most of us could agree that at one hundred and fifty five thousand a sole income, one hundred and fifty five thousand dollar family in New York, you're tight, tight tight, tight, very tight family of five.
Speaker 1:Wife wants to do shit. We'll go on vacation. I'm like I go on vacation for my family and you know it's not like we take crazy vacations vacations 10, 15,000 every time. You got to pay for five plane tickets. You know you don't want to shack up, so kids are sleeping on the hotel floor, so you got two rooms. You know dinners every night. You know it's very expensive, very expensive. So actually when I got on the fire department and I actually held the information back for a while, I didn't tell anyone I was in the fire department. It was a big secret.
Speaker 2:Oh, why is?
Speaker 1:that, so, so, basically, this is how my journey started. I got on the fire department and I was doing minor renovations for people. I actually could sneak something in there too. When I got on the fire department, I wasn't doing renovations for people, yet I opened up a subway restaurant. What yeah?
Speaker 1:Oh, so you always were like kind of just yeah, I'll try to rip through this as quick as possible. So before the fire department I was doing like the auto stuff. I got on the fire department and that kind of slowed down a little bit and I said you know, I want a business that's tangible, that I could actually sell. So I was looking at franchises and Subway was the least expensive franchise to get into. It was 150,000 ish to get into it. So I wound up buying a Subway in Staten Island, worked it for probably two or three years, realized that the only way to make money in subway is if you own 100 of them. You can't own one subway and make any kind of money. It's hundreds of dollars a week that the subway clears, 1,000 bucks a week that it clears. I'm like that's a lot of work.
Speaker 2:A lot of work for a little money.
Speaker 1:Yes, so I basically went back into construction because of what it's, it's what I knew and I always wanted to grow a business alongside the fire department, because the fire department's a full-time career, but it's um, it's really two days a week, two 24-hour shifts a week, or, to be more precise, it's 7 24s a month. So for seven times, seven days out of the month, you're there and then the rest of the time is on you, whatever you want, so you could live a regular farming life which you work to seven days a month and then you do whatever, whatever, whatever you want Right.
Speaker 1:Or you could actually use the time very well as well as you'd like to do. So how do you get into construction with no money? You start doing repairs for people. Yeah.
Speaker 1:Right, you don't need any money. You need some tools, kitchens, bathrooms, stuff, yes, and you get a job and then with that job you pay for more tools and that's how you kind of grow. A construction business works pretty well. Um, and then I was like I know I want to own rental properties because I'm going to be able to retire from the fire department and have all that money to myself by that time, which is, I mean now but how did you know this?
Speaker 2:uh because that was before you're talking, 20 years ago, right? Uh, uh, 18 years ago 18 years ago that real estate wasn't that popular. Back then you're talking 2006, 2005.
Speaker 1:Yeah, um, real estate was getting like yeah, so actually, I so actually, my first purchase was in 2008, so naiveness, is that a word, naiveness?
Speaker 2:naivety, naivete naivete.
Speaker 1:I got into real estate in 2008 not knowing what the hell was going on around me. You ever see in a movie. You ever see a movie that you walk, that the actor or whatever is walking away for something and there's a big explosion happening behind him yeah yeah, yeah, he's not reacting. That's when I got in, but for me it was a good explosion. Why is that? Well, because I got in after the crash. Oh, wow, Cool yeah. So I didn't get affected by it. I bought low.
Speaker 1:Yeah, yeah, I bought low, just be like oh, I'm just gonna go buy something this is normal.
Speaker 2:Yeah, these are the normal prices. These are normal. This is normal.
Speaker 1:Actually, this is hard, yeah, and people are like what I just lost everything.
Speaker 2:Wow. And what goes back to that point? Everyone thinks everything is hard everyone thinks everything is hard right and it only looks easy when it when it pans out later yeah, like 10 years later there's like or these buildings 50 years later, the guy in the mansion how did he get in the mansion?
Speaker 1:right, exactly wow. Or someone bought like I. I think a lot of people that bought real estate and did very well you know, actually we're making bad decisions at the time oh, wow like think about at one time. There's a time into the future that where we are in, this building will be surrounded by very expensive buildings sometime into the future. That's right, right. Williamsburg, brooklyn was dead forever and at one moment, snap, it changed. The people that were buying prior to that probably were making a bad like. Their decision was not a good decision.
Speaker 1:They were buying in an area that was depressed forever yeah and they just happened to buy at the right time and timing was on their side. They did not do it they weren't brilliant they were not brilliant, right, they did not strategize properly.
Speaker 2:They just how does that make you feel? You're like a numbers guy, you seem very data driven, you're all about it like in 2008. You kind of got. I don't want to say lucky because it wasn't luck, but it's like how do you feel?
Speaker 1:yeah, I mean there'll be some. So I house hacked. That was my first purchase. Were you married at the time or no? So I I met my wife at the jersey shore and somehow she was pregnant three months later.
Speaker 3:Okay, two months later, somehow. So I was like so, like I guess you know, she was pregnant three months later okay two months later, somehow.
Speaker 1:So I was like, so like I guess you know she was like I guess we have to move into an apartment because it was decided like yeah baby's coming boom, what are we gonna do?
Speaker 2:okay, I don't know if it's personal, but you may ask any question you want oh, I love this.
Speaker 1:Okay, so first we're in the jersey shore of djs belmar all love happens at belmar, yeah they say don't get married to djs.
Speaker 2:Well, I did, yeah so, yeah, and belmar is great, and thank god you came to the jersey shore, where all of now, you're back at the jersey now we're back yeah, it's all full circle. That's right and now okay. So you meet, you meet the girl, you meet this girlfriend. Girlfriend becomes wife, pregnant. As girlfriend, pregnancy wife, you do the more traditional route. You say, hey, let's do this right. You move in together, boom.
Speaker 1:That's right. Did not get married until two years later, okay.
Speaker 2:So you said, hey, we're going to move in, but let's feel this out, that's right, okay, Respectable. Actually, I highly agree with that decision. I think it's crazy when people get pregnant and say now, we got to get married.
Speaker 1:Yeah, you don't want to compound problems.
Speaker 2:Correct One thing at a time.
Speaker 1:Yes, that's right.
Speaker 2:Yeah, I actually really agree with that.
Speaker 1:When you get married, you're just getting the government involved in your relationship. That's it so good.
Speaker 2:With that said, actually that would be interesting. With that said you end up Because she was pregnant.
Speaker 1:I always, so I was always quietly saving for this investment property.
Speaker 2:But was it a catalyst? Was like, okay, she's pregnant. Now I really got to pull the trigger on something. Yes, wow, that first kid was a blessing. Yeah, that first kid. You should name that kid Blessing. Yeah, wow, that's a good wow.
Speaker 1:So bought a house. Two family bought it. It was a foreclosure reo. Actually the guys that built it. It was a new, an unfinished new construction house. So somehow my first house was a new construction house. Since then I've never not lived in a new construction house. What? And I'm on number three, so I'm very spoiled. So it was a wait.
Speaker 2:Why was, if it was a new construction?
Speaker 1:I'll tell you what they did, and we're on a real estate podcast, so it's good info. Not that anyone that's listening should go do this, but basically what they did is they were buildings pre-2008, pre the crash, pre when everything goes, or they were building at a time when anything goes. They built this new construction house, two of them actually side by side 1802 Drumgoole Road West, 1802 and 1804,.
Speaker 2:I forget the one that was named.
Speaker 1:It was either up or down, but mine was definitely 1802 Drumgoole Road West. You can look it up. They built the houses as shells during the time they could do drive-by appraisals, got the houses appraised for seven and change each, took all the money out of them through a refi and then just let the project die. So they basically walked away 1.4 million with shell of houses that they just abandoned the project. So they basically robbed the title company and the bank.
Speaker 2:And then get foreclosed upon they foreclosed on them, took them.
Speaker 1:Those guys got locked up for something else. They were just doing stuff like that. And then went into the whole thing, and then I bought it from Aquin Loan Servicing actually, I don't know if they're still around.
Speaker 2:One giant lesson. My life pretty much collapsed.
Speaker 1:I was like 20 years old you have a very interesting story, yeah yeah, my life, yeah, collapsed, and I learned a lot when I was I mean you know to to your?
Speaker 2:yeah, I think so, relatively so yeah when I was 22, I went to jail for six months. Right when I went to jail, I learned a very valuable lesson, very valuable the human condition is completely deprived. People, ultimately, are very fallen, no matter what you want to believe the best in people, hopeful and people yeah, great. Ultimately, though, this one guy I met in jail was very interesting. His name was ellie right, he's not a real name, but this guy's like nickname, sure, ellie. Ellie told me a story about how, basically, when he was 17 years old, he, him and his friend completely manipulated someone, uh, like a younger guy 16, 15, 16, whose parents were rich, to basically befriend him. They got him laid all this stuff it was an insane story and they convinced him that they were all going to run away together in California. Ali took his car, the other friend pretended that he took money from his parents.
Speaker 2:And then the younger guy. They knew that the younger guy's friend had a safe in the house. He took like 200 grand from the safe. He knew the parents code. He hops in the car, go say I got the money, we're gonna be good guys, because now these are his school kids right.
Speaker 2:The parents hate these two kids because they keep getting in trouble school. You can imagine as a parent, how important it is who your friends hang out with sure ends up. Le turns around, slashes the guy's, kicks him out of the car. Two miles out of town, wow, the guy falls on the floor. They didn't slash deep enough. He survived. Someone picked him up, drove him to the hospital.
Speaker 1:His intention was to kill him.
Speaker 2:Oh, his intention was to murder him.
Speaker 1:Wow.
Speaker 2:They survived. When the guy came out, basically he ended up saying these two people they told this whole story, police, whatever they never get the money back. Wow, ali. And the guy said we never got any money. That was their whole thing. We never take the money. We don't know what he's talking about. They never get the money back.
Speaker 2:And ali got like seven years in prison as an adult, as he was tried as an adult at 17 wow the reason why that story is so interesting to me is because, ali, I would ask him, ali, that was kind of crazy. Seven years, six years, six years for 200 grand. You got 100. He got 100, your partner. Is that?
Speaker 1:really worth it he goes.
Speaker 2:It's 100 grand. Of course, it's worth it.
Speaker 1:Wow.
Speaker 2:And he was so nonchalant I said, okay, that's crazy. He then went to tell me that his cell was robbed and his cell was robbed and when his cell was robbed, robbed his first few months in because he was in a serious prison. He was 17 years old. Someone he knew from town told him who did it. So he went and he stabbed the guy like 15 times. The guy got helicoptered out. He got another like four or five years. I said, okay, stop, pause. How much was in your cell? He goes 200 bucks, 300 bucks. I'm like is that really worth five years of your life? He goes Brennan, you see my cup on my bunk, right, because we were in an open pot. He goes see my cup on my bunk, it has water. If you went over there and knocked it over, I would knock you down. Like it's not a matter of the money, it's a matter of principle, because it's no big deal.
Speaker 2:It's no big deal, I'll be here. He did five years. Finally I said what'd you do for work? When you got out, I'm super curious guy's opening up to me. But he goes oh, I worked in flooring. I'm like what you guys? Oh, I have my own business carpeting flooring. I'm like, yeah, so we just I'm like what, what do you mean? And now I understand real estate. Basically he would go into people's houses alone do work for them and no one ever. How many times you a background check on a contractor?
Speaker 1:Oh, I'm sure we've hired, yeah, the crazies of the crazies, crazies yeah.
Speaker 2:But meeting him. He was such a cool dude, super nice guy. Man Like you would hit it off with him. Yeah, yeah. And the whole lesson taught me is the same exact thing I'm learning in real estate, where nice people, genuinely polite people, people you think are very well presented. Do not underestimate the broken nature people can submit to like the builder right the guy who flinessed the system and it'd be locked up, yeah there's a story in newark here where literally the city co-signed, took pictures with this one developer huge deal about.
Speaker 2:The developer went to prison like six months later. The project they signed on was this parking lot, whatever with it for the city. He ended up like being that whole project was investigated for bribes and he's been doing this for like 15 years. Wow, he's like such a highly respected figure. So you think that you're like people and real estate really teaching me this. You think it's different? Right, maybe it's just jail. It's not. Real estate is full of real estate professionals, just shady stuff. Man, you got to be really, really. And there's like a gray area. Right, we will live in a gray area. We don't. Real estate's on black or white with the rules yeah there's gray.
Speaker 1:But even in that gray man there's a line that some people just do not give a damn, they'll just cross yeah, you know, I could say like over my real estate, over my career, the amount of times where I really found someone pulling something shady, I can't say it's happened enough for me to. I've personally, in my 40 years of life, had had nothing. I have had nothing but great experiences with other humans.
Speaker 2:Can I tell you what this may be. It may be because of your intention be. It may be because your intention. It may be because the way you carry yourself. It may be because you're like, hey, I'm forthright, I'm up and like I'm gonna do the right thing, that's it. And when people see that like you ever see that trick, um, you can't con an honest guy yeah it's because the honest man in real estate, especially it's it's a, you see it?
Speaker 2:you see it, you see it like alright, and for you? Are you going to take a shortcut to make an extra 10 grand and put yourself and your family in prison? No. Are you going to do it for a hundred grand? Probably not. You're probably like okay, if I can get in trouble I pay a fine. Maybe I'll do it Right, but if I'm going to prison I'm not going.
Speaker 1:Yeah, I'm not taking. I mean, how old are you?
Speaker 2:I'm 20. I'm 30., 30.
Speaker 1:So I'm 40. And it's funny. Then I look at older people and I'm like, well, there, like I'm, I'm not looking to burn any time, none, but but yeah, I mean generally, I, I, I'm, I'm a pretty diligent person. I don't feel.
Speaker 1:I don't think the only people I've ever been taken advantage of are some bad tenants over the years that's true but I don't have any relationship with them really I don't meet any of them really but but people I actually transactionally do business with, I haven't had any real like people try to pull a shirt over my head, you know, maybe it is because the way that I, you know, carry myself that people like, ah, maybe let's not fuck with this guy.
Speaker 2:Yeah, that could be the case.
Speaker 1:Yeah, I, you know I I pay attention to the detail.
Speaker 2:So this, okay. Back to the marriage question. Yeah, what did your girlfriend now wife think about the duplex? Was she supportive of it or not so much.
Speaker 1:Yeah, she. So I could say in my marriage and everyone's got a different relationship with their wife. My marriage is my wife looks at me and just go do your thing. So I don't consult with my wife on any business decisions. I don't consult with her on hey, I'm to go buy another investment property. I never have and I never will. And it's just because that's not her department. Her department is the kids. So she's in charge of the kids and once in a while she'll say like, hey, just so you know I'm doing this and this and this and I don't cross over Like I've never demanded anything be done with the kids where.
Speaker 2:I'm like, you're not doing that, you're doing this I've never done example of something that your wife does. You're like okay, I trust you on that, um, you know the kids stuff.
Speaker 1:It sounds so silly, but like what school they go into no, I have one kid actually. I'd like to know, to be honest, yeah, you know what school they're going to, or or it's a lot of school stuff with the kids, like what they're going to attend, what sport they're going to go into, uh, but you're not going to shut down if your wife's like, hey, listen, you know what's your oldest name sienna sienna beautiful name, sienna, it's actually a really nice name.
Speaker 2:Sienna was like okay, you know, sienna did something reckless. We're going to basically ground her for this amount of time. You're not going back saying, nah, that's ridiculous, blah, blah, blah right you're like okay, I trust you yeah that's wrong.
Speaker 1:Yeah and Okay, that's a good example. So my Sienna, she's 14. So for anyone that's listening that has a 14-year-old, that's when it starts to get a little shaky. Okay, All of a sudden you get home and you find someone on her phone. They're like you had a twisted tea last night with your friends. Yep. And I'm like fuck, what do we do with this? You know, you know, and then I look back and I'm like yeah, I mean, I guess I had like a zima when I was 14, remember zima.
Speaker 2:Well, I don't know. You probably know. I have no idea.
Speaker 1:I'm imagining it's some cocktail yeah, so zima would be like, uh, you know, like they have like hard hard seltzers and stuff. Now it's like you know, it's like a, it's like that kind of drink it's like a mike's hard lemonade twisted tea 2d yeah, the fruity 2d drinks do you get? Super sugar yes exactly.
Speaker 1:So you know you start trying to think back and like decisions like that, like what do you want to do? Like oh well, it's a punisher and do this or whatever, but but for anyway, the main, the main point is is like that's her decision, or financial decisions are mine, and you know I'll like. You know, if we sit down and have like a glass of wine and discuss stuff, like I'll just tell her what's going on in my world, but but the the biggest thing is is like I'm in charge of that stuff and it doesn't cross over and it's never like don't do that, don't spend your money here don't do like her.
Speaker 2:Full trust is in me and your wife never feels like you know. You referenced your mom right when she bought her house in the 70s was like holy crap, this is scary. Your wife never feels like that way in terms of investing or no.
Speaker 1:She, my wife, feels, which actually to fault? I would definitely say to fault, and I tell my wife this to her face, so I could say it here my wife has absolutely zero respect for money and it's she's never had that pressure of I may not be able to pay this bill when it comes, never had that pressure of I may not be able to pay this bill when it comes. So my wife does live the easy life and sometimes like as far as that, like pressure of money, whereas sometimes I'm like dan, we just closed on this and this and this, we're tapped.
Speaker 1:So any real estate investor knows that, like you're either rich or poor yeah like you could be cash rich and then you just close on a bunch of things and you're like shit I'm broke. So you're asset rich, but you're cash poor yeah so sometimes I'll tell my wife, like yo reel it in like we're gonna skip a couple nights out to eat here yeah we're not gonna do this.
Speaker 1:And and it's very difficult for her to concept of like wow, it's so interesting, how is it so? Hold on? And my kids have said to me, because it's like some content on instagram. She's like dad, are you a millionaire? And I'm like yes, like how many? Millions and I'm like enough a lot. But you know because they they actually asked in school like is anyone in here a millionaire? What?
Speaker 2:yeah that's a weird question, so my daughter was like that question I know that's weird.
Speaker 1:So my daughter was like, dad, we're millionaires, right, and I'm like, yeah yes, wait.
Speaker 2:Why did they ask that in school? What a terrible question to ask.
Speaker 1:I know, I know, I know it's weird, it's very weird, but you know what how I mean. To a lot of people there's a lot of people out there that millionaire is such a separation it is yeah, it's a lot, but once you are here, then you're.
Speaker 2:Once you're here, you're like. There's actually people who are like literally like I was a millionaire when I was 27, right by the grace of god, with real estate, only with real estate yeah that's actually the hack for me. The way I see it is like my real. I own a like real estate team. I'm very grateful for the opportunity. I have amazing realtors, number one in newark four years in a row.
Speaker 2:I love what I do and I genuinely like even if I made a lot more, even if I made a ton more money like 10x on my real estate portfolio, I would actually still be selling houses. Yeah, I really enjoy it.
Speaker 2:To me it's like, I imagine, what you feel with development is what I, or syndicating funds yeah, is what I feel with like going on, like which is crazy, because it's definitely you make less money on the this one but they're going on like that appointment with that seller and just like, okay, let's do together I know what's good about your business compared to mine.
Speaker 1:Like I was talking to um, I was talking to one of my friends earlier everything I do, everything I do is long money, long like. So I just signed a contract on a on a deal in long branch that I'm going to build eight $1.5 million houses. So we're doing a $10, $11, whatever million dollar project whatever it is. So my wife was like, oh, that's great, that's cool. I discussed some wins with her and I'm like, yeah, you know the trouble with that. That's money in two years from now.
Speaker 2:Oh yeah, that's tough.
Speaker 1:Right, the syndication stuff. So we get an acquisition fee when we close a deal, uh, but the promote, that's like the real, that's where the money's made for the fund manager. That's at the end, five, six years down the road so I'm always setting myself up for long money, whereas the brokerage business it's quicker yeah, much quicker.
Speaker 2:It's definitely much quicker, and for me it's interesting, as you say this, because my brokerage business has given me access to like very rarely, but some good deals along the way, right, so you talk about you know it's always funny, very rarely I I I'm always interested to hear like from your brokerage business it gives you access to deal good deals.
Speaker 1:Rarely, rarely. Why do you think that is?
Speaker 2:uh, well, I for me, actually, I'm going to be honest with you. I'm very pre-open. I don't care. So this is what I do, right, man, it's so good, I'm so excited. There's two because I really am passionate about this the way that real estate impacted my life was so transformative. I've been able to help other people Truly, truly, truly. I have more than, like. Your wife has a complete different, uh, life than I or my wife did. It was so interesting. My wife and I we both grew up in like very low-income families. Yeah, so my wife she's like. We're about to build a house I was telling you about down the shore and may build one in newark to live in for the time being. So I'm.
Speaker 1:My wife's dad was a sanitation worker, so I don't know where the disregard for money came.
Speaker 2:Oh okay, yeah yeah so my wife yeah, my wife has a very high regard, so I'm talking to my wife about the mortgage and basically it'll be like 1700 more than we're paying now, 2017. I'm like, no, this is fine.
Speaker 2:We can definitely afford this like we're not in a position where 1700 is going to kill us. If we were in that position, we should be panicking right now and but she will not. She's like I don't think it's the one, brennan, I don't think it's one issue. Their only restraint is like the financial pressure. I'm like we're good, like literally, it's one less billboard not even yeah right, like we're good.
Speaker 2:Yeah, the deals, though a lot of realtors will they end up doing is they only approach sellers? All their marketing, everything, all their calls or cold calls, etc. Everything they do is do you want a home valuation to list your house to get on the market? That's their vote, that's their, that's the offer they're making. Yeah, do you want top dollar on the market? Worst offer ever. I learned this from my friends over there at leverage troy and eric.
Speaker 2:They were giving us a lot of their listing leads right for years, three years their dispositions they're on the list on the retail side and what I learned from them three years? Anything they would said, hey, I want a retail price. They would refer over to us.
Speaker 1:Got it. So when they because Leverage is out there cold calling trying to get people who are like I'm ready to sell now, and then people are like you know what, I'd rather list it than they send it to you, correct, I would pay a VIG and that would be that Got it.
Speaker 2:So the point we're doing, we send checks out to homeowners and we say, hey, I want to buy your house Like you get a check from, like a dealership, like a physical check, and it's like that looks like a W-2 came in.
Speaker 2:So you open it up and we send SMS like a hundred thousand or whatever it is and saying like a month, and we say like, hey, do you want to sell your house? We want to buy your house. You want to buy your house cash. We genuinely have the. I have every intention to buy every house I can buy why not? But when I'm there, the vast majority of the funnel is either waste of time. Then there's a bigger. There's a still very small portion which is like people who will sell in the next three to six months a year, and then there's a tiny portion which is this is a property I need to buy right now, and that tiny, tiny portion is really how I became a millionaire. But the middle funnel, where it's like people that are listing those listing that like cash flow in my business, gave me the freedom to be able to invest in those like renovation projects and invest in the marketing, because marketing is very expensive so you're.
Speaker 1:So you send out. You send out fake checks is a bad word. No, it's fake checks, Fake checks, okay. So you send out fake checks to someone $600,000 to them. This is what it would feel like. Yeah.
Speaker 1:Okay, through all these marketing efforts because I'm sure you do a lot, you have billboards, you do text, you do direct mail you do not get a lot of responses. People saying I need to get out of this thing, I need to sell we believe her. Now I'm willing to take 70 cents on the dollar here's oh wow, I love, I love this conversation.
Speaker 2:So this real estate taught me another way. Real estate has impacted my life. I learned about change. I used to think well, you have to get really good at one way of marketing and just stay with it for 10 years.
Speaker 2:It's impossible Marketing. It goes like in waves. The challenge was three years ago, five years ago, maybe five years ago before the pandemic, well before the pandemic that 70 cents a dollar, 80 cents a dollar, hey, I just need to get out of. It was like, yeah, this is good, I need to get out. The problem is now with media. The vast majority of homeowners I talk to are in lava land because they hear in the news this house went above 200 grand prices are higher than ever even in newark.
Speaker 2:Newark is in a great job and I'm all about protect the homeowner, protect the equity, all day long yeah I even when I get my deal, I tell them, hey, I can pay this much in cash or this much on if we list it and people will say, no, I just want the cash, say, okay, beat, I don't care. But the thing about Newark is they really promote the city of not selling your property. They promote that Newark is coming. So any person you talk to in Newark now, no one talks like man. I'm in Newark, this place sucks. I got to get out. The homeowners have changed the verbiage. Even the homeowners who are like very low educated, perhaps they were born in another country and they're just immigrants in the past five, 10 years, right, just getting the hang of America. Even they are like no, this is like do you know where I'm at?
Speaker 2:I'm in downtown Jersey City. I'm in Brooklyn, that's how they talk. Wow. I'm talking about even in rough areas of Newark. So they're like no, this is up and coming. I'm holding, holding, yes, so you, we don't get the. It used to be where you would have a lot of people, like a farm. The problem is this land, the soil has been overly over farmed. Hundreds of wholesalers, ridiculous offers, realtors. I just lost the listing because I priced out property at 475 and that was really the max max they wanted 525.
Speaker 2:I said, guys, even 475 was not real. It was crazy, push. I had a realtor go in and tell him hey, I could definitely get you 550. Like this other realtor has no idea what he's talking about.
Speaker 1:I wish people didn't pick their agents or brokers based upon their valuation of the property. I agree, I wish, because you know what. I agree we're listing. Right now I'm selling 24 townhouses in Arkansas Arkansas yes, northwest Arkansas. So so, when we were listing it, I'm like guys, you're talking too much about making sure you get the right price. Underprice the fucking thing, underprice it. You cannot go too low, that's it. You could go too high. Yep, if the things are worth 250, you could list it for 260 and you could blow the whole deal. You could list it for 180 and we could make more money than we ever thought. Yeah, because the market will find itself always.
Speaker 1:So I read this thing from ebay a long time ago. Uh, e said back when eBay was big is eBay? People still go to eBay? I hope so. I like eBay. Ebay said if you want to get the highest price for your item, start the bidding at a dollar, and that is how you get the highest price, because you let emotion get involved. If you go to the agent that says I promise I can get you 520, 530, 540, the agent that said I could get you 475 is going to get the same number, cause he's probably actually going to list the price lower, which means it gets more attention. It goes on Zillow and all of a sudden there's 2000 views and 400 saves. Now it's the hot everyone's talking about. Did you hear about that deal? Yeah, on which street are we on?
Speaker 2:on martin luther. King martin luther king boulevard.
Speaker 1:You see, that deal that just popped up, that two family. Now everyone knows about it, everybody. If you would have threw it on the market for 550, you would just been like every other fucking deal that goes on the market no one cares. No one cares. So pricing your stuff, stuff, lower, just don't pick your agent based upon that. From what I've seen I agree the best, because I've worked with good ones and bad ones you're picking your agent based upon their capability to be responsive to the people that come in, and if they price it lower, their capability has to be higher.
Speaker 2:Much higher.
Speaker 1:Because if they price it at 450 and it's worth 550, their incoming calls are going to be their phone's going to be exploding. They have to be able to handle that lead flow.
Speaker 2:I love, love your mind. There was actually a story in California. They put a house for $1, this brokerage yeah, and it sold for $1.2 million.
Speaker 1:Yeah, there you go and it was like it.
Speaker 2:Asked this guy, they said um, the developer, hey, can we want to do something? You know, we constantly reach sellers who have the same thing you said and we'll have the same issue where it's like why I'm where? I have a client say if I list at 500, get out for 500, what am I going to do? They say no, yeah, that's right whoa.
Speaker 1:I think everyone forgets. Everyone forgets that if you list your home you do not have to sell it literally. People think when they sign that listing agreement, that the house is gone already it's, I'm moving yeah, no, there's no one that comes and holds a gun to your head and says sign the contract. No, doesn't happen.
Speaker 2:Okay, another question for you, chris. Yes, changing topic yeah how do you? You know real estate can be a very the impression is a real estate, especially as developer multi-families indicator. People are really trusting you with their money, right? Yeah they're putting a lot of trust. That trust puts a lot of pressure at times. How are you able to manage the pressure of like without kind of?
Speaker 1:collapsing? That's a great question and the answer is is. That is the most difficult part. So we put projections on deals. So projections are guesses. So we're getting involved in a business that we are guessing the future. We could just guess it because this business, we could fairly predict the future based on the past. But the past recently has been a little skewed. So what's going to happen in the future? Nobody knows is the answer. So during COVID I had a hedge fund buddy who I built his home for him probably the biggest, nicest house I ever built and I spoke to him through all through COVID. He's like Chris we have the smartest people trying to pick the future and every moment that goes by proves that they were wrong. So the answer is you can't predict the future. So as we're going through these deals, there's up months and down months. So, different from every other syndicator, we pay monthly. Most other syndicators pay quarterly. Oh, wow.
Speaker 1:Yeah. So which puts us in a position that our distributions seem a little bit more sway, because you see the immediate effect of every single month, whereas we paid quarterly that those hits come slower and you don't notice them as much because you're not expecting that $500, $1,000 to hit your account. So now when it hits your account and it's 900, all of a sudden it's like dude, what's going on? And we're like and I have to call sometimes, sometimes, sometimes call my investors and say you got nine hundred dollars where you normally get a thousand. The business is still kicking off a tremendous amount of money. No one rent, no one leases. In the winter, if an apartment goes vacant, it stays vacant. In december, january, which is how it is, uh, february, very March, it'll be leased. So this business you'll see in the summer Now, in the future, your checks will be higher. It's just how this goes. So that pressure, and when someone calls me like, I will cancel Christmas morning with my kids to answer a question from an investor. Wow.
Speaker 1:It's just if I'm opening kids' presents with my kid and I see my phone and it's an investor. My personality is. I have to stop what I'm doing, answer that question and I'll get back to the gifts.
Speaker 2:Wow, really.
Speaker 1:Is it? Should I be doing that Like as a father? Probably I mean everyone will say, like I would never do that, like that's just how we run our business I don't know.
Speaker 2:You know, I think look teacher's own for sure but the pressure, do you ask?
Speaker 1:how do you handle the pressure, the pressure of not doing exactly like if the performance and you could, I tell the investors like it. I I know that I know what next month already looks like because we see the future leasing next month will be higher and whenever it's downslope, the pressure spills. But now, when it's an up month, now when you're sending out 11, 12, 1300, you don't hear from anybody.
Speaker 2:No, no no, it's the same thing. So I manage airbnbs for, like, maybe I've managed for over a dozen people, maybe, uh, I manage right now maybe like 35 airbnbs, 40 airbnb listings like some of them are room rentals, but across like maybe 15 different properties, right. So my? What I've learned, though, is exactly what you said. There are months that one of my, one of my guys he just got four thousand dollars. He usually gets 3100 didn't say a word.
Speaker 2:Nine hundred dollar difference big money yeah, and one month he got 2600 27. This guy went off. He canceled airbnb. I need to put it as a rental. Can you find me a tenant?
Speaker 2:yeah, I'm like this guy, yeah. And then, thankfully, I have one guy I'll give him a shout out oscar pita. Great, uh, one of my first. I sold him a three family new york like five years ago. Well, good friend now, and like, uh, I managed his property for him. He's actually looking to buy another. The point of story is he will go up and down, up and down, up and down, but he just remains like totally, totally trust, because he's done it with me for two years on airbnb, or just coming on three years. So he's like I know january and february suck. Yeah, he goes. We, we always lose money here. Yeah, so he doesn't panic. Yeah, because then in june when he's like holy crap, I brought in five grand, it's like cool yeah, no, big deal yeah no, but it is.
Speaker 2:Uh, the up and down could be a lot, but man, I gotta be honest, the syndicating, that is one of my fear. That's a big fear.
Speaker 1:Yeah, it's a thing. It's definitely a thing. And even though you know everything's okay, the pressure of people coming at you like what's up? There's pressure actually. So we just started a new fund for development because there's so much money to be made in development in the areas that I'm in, like Jersey Shore, staten Island, the video that you saw me on the two family we got off that topic a long time ago. Those deals are very lucrative and very stable.
Speaker 1:Like that home's selling at or above what you thought it was going to sell for. Yeah, even in a bad market, that home's still going. You're in New York City, right? So everyone wants to think that everyone's leaving the city. Sure, One ass leaves. There's five that want to take it. Literally yeah. So now we're raising capital with a fixed interest rate or fixed rate. So 10.5% to 11.5%, depending on how much money you put in. That's what you're earning, no questions, nothing.
Speaker 2:Well, I'm afraid you lose money on the deal, so I'm sure you must have lost money.
Speaker 1:No one's perfect the only deal I've ever I've, so I've never lost money on a real estate deal.
Speaker 1:Stop you've never lost any money no, no, because the majority of my projects were rentals and all my new construction projects. There's such a large spread. Um one deal I made 10 000 on that. I put a lot of work into that. Was a flip in staten island and from that I learned don't ever. The problem is, don't ever buy a house next to a hoarder, because whenever you go to market that house, no, no matter how nice you make it, the next door neighbor will make your house look like shit.
Speaker 2:Good lesson.
Speaker 1:Yeah, so that was a house flip, less margin, so I didn't make nearly as much as I like, but I never came out negative on a deal. Wow, the only time I actually ever lost money in real estate and this is what you actually pay sponsors for is just recently. I lost 180,000 on a down payment. So I put a down payment on a property, $100,000 down payment, then lender deposits and all this stuff, it added up to 180,000. Um, we went through due diligence and we wanted to deal so badly in Northwest Arkansas that, against my better judgment, I guess I put a hard money deposit my own money.
Speaker 2:What's hard money deposit mean?
Speaker 1:It's non-refundable.
Speaker 2:Oh, okay.
Speaker 1:So I put a deposit down, we went, we toured it, we went through it, we went through the numbers over and over and I'm like you know what Interest rates made a little bit of a change and I'm like this is not. We raised all the money I was sitting in the account and I'm like this is not. We raised all the money I'm sitting in the account and I was like we're not doing the deal told call all my investors, hey, this deal that I wanted you to invest in. We decided that we're not going to do it and I just had to let the money go so that I didn't lose money.
Speaker 1:I've never lost the money on a deal that I closed on. How about that?
Speaker 2:yeah, that's good. Yeah, that's pretty rare, man. My first deal, I got panicked by an oil tank and I took a seven thousand dollar loss outside that.
Speaker 1:I've not lost money yeah, I mean, that's seven thousand, seven thousand it was my first deal. Yeah, if anything you made a ton of money on that deal I survived, yeah, in my mind.
Speaker 2:Oh, because the oil tank no, because of the knowledge you got oh yeah seven thousand is nothing do you know now, actually, to be honest with you, I love buying properties with oil tanks, almost every property I've ever bought. I've bought 12 properties so far. Of the 12, only two have not oil tanks. Wow, oh sorry. Three have not oil tanks.
Speaker 1:You love the scare factor, I love it.
Speaker 2:Yeah, that's where the distress is. That's where the deal is. Yeah.
Speaker 2:The higher the distress, the higher yeah okay, so, okay, another question real quick for you. So, but I guess you kind of hit on with the kid thing. How do you, what do you do you like? How does it feel? It's like parent, right, because I have a one kid right now. Hopefully my wife and I will have a second one soon, yeah, how does it feel like running the business and then somehow making time so when you're with your kids you can actually be with your kids?
Speaker 1:very difficult, very difficult I'm. I'm so laser focused on what I'm in business. It is difficult for me to peel away and give the proper time I should be giving to my kids. It is a guilty thing. Pictures help me get through that. So it helps me remind myself that we did do the things. We are doing, the things what?
Speaker 2:do you mean the?
Speaker 1:pictures, take pictures of what you're doing, like this is a constant thing that's going on in my head, like the topic you just brought up, like how do I make time for my kids? I do, and sometimes I'll start thinking to myself like I'm not doing enough of it. It is a constant battle in my head. You're constantly like now, if I don't focus on work, am I doing the right? Because you basically go to either extreme right. One extreme is never talk to your kids and only focus on work, and the other extreme is don't focus on work at all and only focus on your kids it's so interesting.
Speaker 2:There's like, uh, it's very interesting whenever I hear success, very like people who are like motivated, ambitious, successful, to degree. The vast majority of time they think binary, where it's like either I'm in one extreme or the other stream, it could literally just be in the middle. It could be be like we can do like my business may not grow at the velocity it grew, but I still am going to grow it and I may not be spending as much time with my kids as I want, but I'm spending more time than I did. Yeah.
Speaker 2:So it's like that is actually what I've learned, is the way, and I like.
Speaker 1:I think that is the interesting, though, because it's actually gotten significantly harder for me as I got older oh, why is that?
Speaker 2:yeah, I think we easier no, yeah.
Speaker 1:So I had my first daughter when I was 25, 26, running the you know the businesses I was talking about earlier. So subway to home remodeling, to custom home building, to running apartments. During that time, up until about mid thirties to 36, 37, I was very good at very little to no phone calls at night and very little to no phone calls on the weekend. Very good at it and like this is family time, this is what we're doing. As time went on, I decided that I wanted to really step it up and level up. That's the point that I'm at right now, as we speak.
Speaker 2:How long ago was that?
Speaker 1:Two to three years ago where I was like what I'm doing isn't scaling fast enough. I need to stop what I'm doing, change gears, and that was me saying I'm no longer doing renovations for people, I'm no longer building custom houses, I'm only going to be doing my own projects with the syndications and the multifamily type thing okay, so it does make sense right now, while you're picking up the phone so much.
Speaker 2:Yeah, I promise you, if we got back in this share three years from now, you would not be picking the phone so much. Your system would probably be mobile. You probably have some people raising the funds. Yeah. Investor relations specialist. Yeah very, I think in 40.
Speaker 1:I've seen a lot of people do this at, for some reason, like your, late 30s to 40s, late 30s, early 40s. A lot of people sell which, if I have any advice to anyone, thank god I built my real estate career from a young age, so I actually have assets there's a lot of 40 year olds that have their salary and that's it.
Speaker 1:And I'm like holy shit, I'm mad that I had my salary, my business and my real estate assets. But the one thing I wish if I were to go back in time and do differently, is I wish I built a business that was sellable and infinitely scalable, which the renovation business isn't really.
Speaker 2:No, it's not, it's too detailed. No, no, no, no, it's not, no way, no way. Yeah, you can't. Yeah, like you know the book like Built to Sell. Like, literally, the book Built to Sell. Yeah, long story short, that's what they talk about. It's like, right from the beginning, you have to know what you're building. Yeah, I have a real estate team, right. Yeah, real estate team is not sellable. Yeah, I don't know anyone who's ever sold Actually, that's true, what people do with real estate teams.
Speaker 1:Yeah, what do Corcoran sell?
Speaker 2:So that's different Brokerage, okay, brokerage, ugly cousin. Yeah.
Speaker 2:It used to be. Now it's like the hot they've got very hot. Now there's actually like, basically your real estate team becomes your own, like private boutique brokerage, and the point is this what people will do when they sell. Because if you have a successful real estate team, like we do 200 units a year, give or take, we do about 100 million in volume, right, give or take. So say it's about like 2.5 million in gci, right, 2.5 million coming in, maybe 2.8 million, whatever 2.7.
Speaker 2:So if we do that, that is very, very unique because all your money really is coming from sales professionals that can leave tomorrow. So people, and especially when my team's named the silva team, which is actually very bad, because when you build to sell and I've thought about something when times I was like very down, I'm like man, I just gotta get rid of this bad, because for me, what I've learned is what you actually want to do. You want to build great systems, great processes, have top, top talents with a long track success record, so it's like it's like an asset, right, like my top people are like my assets, like hey, you're like yeah, I'm heavily invested in making sure you succeed because, it's mutually beneficial, then what they'll do is this this is what most people do.
Speaker 2:There's big, big, big, big teams. For example, one is called Sarah Reynolds Empower Team. She does like $33 million in GCI, right, so her business brings in $33 million. She'll go see your business, she'll come visit, she'll look at the books, she'll meet the agents whole nine. Now I guess her acquisitions person does it and then she'll partner with you.
Speaker 2:So hey, you step aside, I'll run the shop, you'll get a vig, so you're aligned with interest, right, but I want the bulk I want like the 51 or whatever it is, and then that they have that same thing with empower, homes, place, all these different big companies uh, even eric amalkanov, he's with place, right, so they like partner you, they're building the organization with you, all that stuff, but they take a vig. And with that. I do recognize, though, that I'm building something here in real estate team, that when I die unless, like, someone wants to take it over, like one of my employees or something, or I walk away from the business, one of my team members and I get a vig it's not something that you can ever really hand off yeah, it's a.
Speaker 2:It's a very unfortunate.
Speaker 1:I do agree with you it's very unfortunate yeah, looking back, that would be the biggest, because I've seen it a lot, like when you hit 40, like you kind of it's like a second wake up, where you're like almost check in with yourself. Almost check in with yourself is what. I'm doing the right path for the rest of my life, and I decided at the time, a couple years ago, that it wasn't Wow.
Speaker 1:And I do know a lot of people who made the same decision and they just had an exit. They just sold their business Peace, so that I basically had to just say I'm not doing that anymore.
Speaker 2:But you had your real estate portfolio.
Speaker 1:Yes, yes, I'm crying with two loaves of bread under my arm, but if I were to go back in time, I would have liked to exit a business instead of not do it anymore.
Speaker 2:Yeah, oh, because you didn't do the real. Oh, I understand now, because you had built all this customer base with the house building, with the custom builds, with all this stuff. And now, what are you going to do? You're going to hand it off to someone for free.
Speaker 1:I was them for free, I was I was using the money.
Speaker 2:I made to buy real estate, yeah great, so that saved me.
Speaker 1:Oh, so I didn't.
Speaker 2:I didn't, I didn't. I don't look back. That's how I feel right now I didn't look back.
Speaker 1:I'm not looking back at my first 40 years and say I fucking wasted it. I didn't do what I needed to do.
Speaker 1:I have all my real estate yeah which is, I mean, an exceptional portfolio Like to say that I have $15 million of my own and then another 50 million in syndicated asset center management, like it's a nice portfolio. But if I were to go back and say what would I do different? Because I think I actually think it's good, I think it's good content for a podcast. Like if I'm listening to someone talk like what would you have done differently? Because you know people are like oh, someone talk like, yeah, what would you have done differently? Yeah, because you know people like, oh, that guy's successful whatever. And like no, I'd like to know what would you have done differently?
Speaker 1:yeah my answer is is I would have made sure that I built something that actually was able to be sold, and I know so many of my friends. Even with successful businesses like dude, my shit ain't sellable, even my buddy who's building the, the, the high-rise building next to my apartment years yeah 100 unit. He said he's like my business ain't sellable and he's he does um superstructure, concrete superstructure and he's like the whole business is so him centric he's like if I die.
Speaker 2:The business dies so wait, you couldn't have, you know, sold your home building business, you couldn't have partnered with another builder and taking a vig on the clients you brought in, or something yeah, but so okay, could I have sold the business?
Speaker 1:the answer is is who's gonna buy it? Like why would someone buy a renovation company on staten island?
Speaker 2:did you know? There's actually a big move to buy small businesses, like now more than ever, because the baby boomer generation they retire. Yeah, we have someone on podcast. That's what they were talking about. They were talking about how they were looking to buy any businesses and that was a big thing.
Speaker 1:I really think that there's a good future in buying businesses like that Home rent of, like if you could buy a plumbing, so you now. So now you're buying. Okay, that business is a one and done business. I built someone a custom house I will never see you again right. If I have a plumbing business and the phone's ringing all day with repairs. If I just hand you this phone, that shit will continue to ring.
Speaker 2:What's the term? It's like predictable revenue, something like this. David taught me about it. Actually he was telling me he's like that's how people value businesses. It's like something revenue. It's like where predictable revenue coming in each year, that's what they go off of. So, like the plumbing business, that's a good example. Yeah.
Speaker 2:Because it's like, hey, this is going to keep happening. The giant one-offs, high risk, high risk. Yeah, those plumbing businesses, the reason why it's cool they sell great multiples Three to five, boom, boom, boom. So you can make. I think you're right actually.
Speaker 1:That was kind of my vision with Airbnb. If I would have niched down, my business would be significantly more sellable. So every single time, so say if I had a roofing business, a plumbing business, hvac business those businesses grow because they're so niche. Yeah, like my business, it's a custom, it's a relationship you know you're you're getting when you have someone build you a house.
Speaker 1:You're getting in bed with them for six months, eight months a year yeah, and you're really in bed yeah, like you're where we're, we're straight up sleeping together, really, but in a roof you're like, oh, I heard this company, this company's good. I heard you, I heard this company is good, right in and out. They come, they rip the roof off, they install it great. Oh, it was a great experience. So so, in hindsight, I would have built something that I could sell, and how would I have done that? I would have niched down wow I was general. I was a general contractor. General, that means it's it's very difficult to.
Speaker 2:Yeah, you're broad, systemized, yeah no, no, no, and the systems are. Though I think that's what I realized, man your life in real estate, because I'd say it doesn't real say entrepreneurship. Let's say, for example, there's a really good book, it's called uh, buy back your time, actually you should read the book.
Speaker 2:It'll be really good, really good actually, especially with the kid thing that you reference. Um, one thing that he does is he makes people go through, uh, like every 15 minutes. Write down what you do for two weeks and like then in the end you rank it on what do I make the most money on and what do I make joy on? Let's scale one to four.
Speaker 2:One to four and then you put it on the graph. Anyways, it's really helpful because it actually led me to hiring an assistant, because now my assistant, for example, I'm in between sisters right now. My other one just started. You met her downstairs, diana. So far, so good. One day in. But, um, before my assistant would reach out to podcast guests, she would book and she would do everything and I would just show up. So that Made it sound like much, but that hour I'm like who do I want on my podcast?
Speaker 1:That's so much, dude, it's so much, it's so much, it's so much.
Speaker 2:And then she was what I had her doing as well From the book Buy Back your Time Was Because I realized I was checking email and I was opening up my mail. Opening up my mail doesn't sound like a lot of time. My mail takes about 20 minutes. Every week I get a ton of freaking mail. I don't know how to stop this mail and I always check because I'm worried about missing something. So I'm like, oh God, about 15 minutes a week. I'm pretty quick. Yeah, I get a lot of mail. 15 minutes, no big deal yeah, it adds up.
Speaker 2:So she would go, she would check the mail, she would see, categorize, let me know if there's anything in my attention. If not, bills got paid, I got parking ticket. I even know I got paid. I even think. No emotional energy point I'm trying to share is this if you do not have a business, if you don't have anything, I have a small business. Right, I'm a small business american, right, great brazilian american. What I've learned is if you didn't have a system in place, truly a system, not just like something you say, but documented procedures, how it gets done, the same way, whether I'm dead or alive, it's getting done which I have here and I've been building this over the past like three years now really locked down systems, dude, you will have a miserable life miserable life, you'll want to either sell your business and give it away not even sell for a good price just like distressed.
Speaker 2:Yes a good price, just like distressed yes two, you will stall right where it's like. The expression is like you know you need to fire that person, but you just don't do it you don't know why yeah, right because you actually don't want your business to grow, right, because if it grows it's going to increase pain.
Speaker 2:Why would you grow something that increases your pain? Right, right, right. And then three third thing is sabotage. That's when, like, you're very impulsive, right, you make rash decisions. You like, know for sure, like that deal you away from. You know this sucks, but you're like I'm just going to move forward with it Because you want your business to fail, because you want out, because it hurts you so much.
Speaker 2:With all that said, though, if you do the opposite and you really value your time and you protect your time and you spend time only on things that bring you a lot of money and a lot of joy, you actually don't want to sell your business because you like, love what you do, yeah, so right now, I'm in that place where I'm like, great, I'm really only doing things for the vast majority outside of property management, airbnbs, I'm building the systems around that I really like doing and, honestly, I really like it. Like, like I told you, I probably would do this if my portfolio brian 10 times the money I. I really enjoy what I do Genuinely, genuinely enjoy. It's very rare, but I think it's so good.
Speaker 1:Yeah, I think, getting to the point where the systems are built and dude I hear you so loud and clear on the mail and all that stuff. I have an assistant as well, actually a new one. For a short period of time I didn't have one, just during the transition of moving from home building to this. It's false to say I didn't have an assistant. I just didn't have someone right next to me and I was like man, I shouldn't be doing any of this stuff anything we you skimmed right over it, but writing down the things you do every day 15 minutes, 15 minutes
Speaker 2:it's the biggest thing, and that's actually that I use that procedure to um figure out what to replace next yeah, yes, eventually you can't do it in the system, right then you need, like, someone who's like very, very like, knows what they're talking about in this industry, for example, sales director yeah whatever it is.
Speaker 2:But even right now, my previous assistant uh, I had an experience and loved her, she was great, etc. But she didn't want to do small tasks or what she thought was small, for example. So sometimes I have to run home and walk my dog, for whatever reason. That I did not like doing. I was not a fan.
Speaker 1:I got like very upset. That's why I have a cat.
Speaker 2:Smart man. Yeah, when I was hiring this new assistant in literally on the job description it's like walk dog. Yeah, as needed, yeah.
Speaker 1:As needed.
Speaker 2:It's not rude if you agree. That's right. I was like, hey, this is exactly what's the case. I was solving problems because I would feel bad, like 10.30,. I'm like this leak. I'm just going to help Because she was like Brendan, you didn't tell me I would be getting calls after 10. So the newest is I said you will get a call at 1 am. It won't really get a call at 1 am, but 10 in.
Speaker 1:May it can happen, it can happen, that's so. Yeah, the assistant is the way for sure um the real.
Speaker 2:I tried. Have you ever tried we?
Speaker 1:could probably go on for a long time, but have you ever?
Speaker 2:you have virtual assistants. I have tried. It doesn't work for me because I need someone mobile, because I use them. I have tried virtual assistant a lot. I use my, my assistant, as like a runner. If I need something ran, yeah, like she'll drop listing packets off at client's house, so she'll. And she like. I like the personally.
Speaker 2:I think maybe this is not good, I don't know if I say this, but I like the idea of when you meet my assistant, it's representative of me yeah so when I like one of my big things when I was hiring diana downstairs is when I met her, I'm like this girl is phenomenal, she's so warm, I love her, she's great and I felt that way. So I'm like when someone meets her, I want them to feel the same thing.
Speaker 2:I'm feeling yeah the virtual I haven't been able to find that virtual where they make that like connection, the connection with people. Yeah, because, um, I've had assistants in the past where people are literally calling me after like freddie, what is the, what does savannah do for you? And I'm like, oh, savannah's my assistant. She goes oh, my god, man, this girl's amazing.
Speaker 1:And when you hear that, yes, you're like oh, it's the best thing as a business owner. The best, the best but that guy was.
Speaker 2:That guy was, oh my god, yeah, and you're like that person deserves a raise.
Speaker 1:Yes, that person's getting, like I've actually had people call me say this person deserves a raise. That was, we just gave the guy yeah, and actually it's a funny story. So the woman woman did this about one of the guys that works for me then then hung up the phone and called me back and I was like hello. She was like James, I just called your boss and I told him to give you a raise. I'm like this is still Chris.
Speaker 2:All right, this is what I'll tell you. Oh, last story then. Yeah, I do want to share this one with you, because you said it With your, it slipped my mind With With your wife. You mentioned that sometimes as a real estate investor, right, we can go broke and rich, right? Yeah, I have a smaller portfolio. I just got my 20th unit as of December 29th.
Speaker 1:Thank you, huge accomplishment to me.
Speaker 2:I'm very grateful. Thank the Lord Almighty yeah.
Speaker 1:As you do the closings, do you still feel joy?
Speaker 2:On this one I did feel joy. I usually don't feel joy at all.
Speaker 1:But this one I did feel immense joy, great, immense yeah, try to try to hold that. Try to hold that. For me, when I was younger, it used to be when I closed on something we go out to eat. That night we celebrate holding up probation barks. It's easy to lose that. Try not to lose it good advice because then it's just like the regular course of business. Like I'll, I'll sign a contract while I'm driving on docusign now wow and there's no. The emotion leaves like hold it wow, that's deep.
Speaker 2:Yeah, hold it, that's deep yeah, have the enjoyment.
Speaker 1:That's what it's all about. Wow, I can agree. I think when I become systemat, I always tell a story.
Speaker 2:My first check was like $2,500, $2,700, $2,300, whatever it was. I got a $900 rental check my first sale check was like $2,300, $2,800, whatever. And I drove home I took a picture with my mom. I cried, she cried. She bought me an Express shirt.
Speaker 1:It was a huge deal.
Speaker 2:Long story short my largest sale in my career.
Speaker 3:I had like almost like a sixty thousand dollar check and my assistant gives to me.
Speaker 2:I look at it, I'm like, all right, please deposit this right back to business. And I'm telling you at that moment I I realized like later on that day what happened because I was with, uh, my family and I'm like when I was like, if I bring this up, no one's gonna understand. We're just like, yeah, there's a lot for my family, that's a large sum of money of, of course, right, so it's like this is a year's salary. Yeah.
Speaker 2:Right. So it's like if I tell them this, they're going to think I'm rich they don't know that I just spent like 40 grand last week trying to have this new marketing thing that fell apart and I wasted the money, sure. Anyways, the point is, you do lose the emotion. Yeah.
Speaker 2:Which goes to say this I had oh, I'm so happy with the story. I had a complete, complete fiasco of a house, Six, eight. I ended up being in eight units in North Newark, Right actually the last street of Newark In eight units where I bought it for 950. Oh, sorry, 925. That's what it ended up being 950 with 25K back in closing costs. I bought it, I got the whole place. You know values etc in the past few months. Good, I two units weren't rented. I rent them out airbnb. Now the point is when I bought that I had to sell a property.
Speaker 2:I had to 1031 right to order to get the money, I had to close by the end of the year because, um, you have a 1099.
Speaker 4:I mean for cost segregation, depreciation, because I wanted to get the full right off, yeah so I had to do that.
Speaker 2:When, that though, I bought the property in an LLC in my wife and I's name, mm-hmm, she was like because her credit score is higher, so I said, okay, great, doesn't matter, dscr loan, whatever Mm-hmm Buy there.
Speaker 2:But, the property I was 1031-ing was in my own name and like that, I didn't know. So two weeks before closing, all hell hits a fan. I end up putting my wife quick claim deed on this house. I then, in order to close on time, I have to give this buyer $10,000. Just like free, I'm like. He's like no, no, I'm waiting for a grant from the city. It's $10,000.
Speaker 1:I said and he's like okay great.
Speaker 2:Yeah, I go through with him. We close I 1031. We closed the deal, signed documents on Friday, thursday, friday, whatever the last day of the year. The deal only funded Thursday, the next week. But because they deed it here, we got it going. And that moment was such it caused me so much stress. I'm not kidding. I literally was wired. I had to borrow money because the bank needed the DSCR needed this. I was not really qualified for this thing. I didn't have the money on one place. It came from a business account, my personal account. So much stress. My wife told me, brendan, we should not buy this property. This is causing too much stress. I said, deb, there's one thing we're doing which is buying this property. There's one thing, no matter what it takes, yeah, and during that I was under contract on another property too. She says, brendan, how the hell are we going to buy that one? Yeah.
Speaker 2:I said, Dev, we're not going to be able to do anything financially. Yeah. When I bought the other property in Richfield Park. I bought it with like, literally almost offer 120k more than I paid for it. Great, great, can't be mad yeah great, I spent like 30 grand for need to do just for the city. We would seen, sure. And then I said, great, I still make my money yeah my point is this I took a five thousand dollar loan for my brother. I took a twenty thousand dollar loan from a friend.
Speaker 2:I took like sixty thousand dollar loans out personal loans just to hold me over yeah my wife was like brendan, do you realize that we make so much money in this situation? This is very stressful. Yeah, I said, deb, I understand Very stressful, I agree with you. Yeah. This is what we're doing. She goes okay let's do it no worries, and she's super supportive super loving all. I called my friend. I asked him for a $5,000 loan. He was like Brennan what? You okay. Yeah, and I'm like dude, I just need it for literally four days. Yeah.
Speaker 2:Just need like 60 grand for like five days, yeah. And then we did that and I cashed our refiner project.
Speaker 1:Now I'm rich again, so it's like yeah, man, this is how it goes All the way up, stops, does it? No, you asked me a question. We can probably end on this. Yeah, you asked me a question. In the email you might have said I want to know what real estate has done to your life oh yeah the first thing that came to my head was it ruined it, wow ladies and gentlemen, yeah, you got chris out here.
Speaker 2:Please follow him. He'll be linked down below. Appreciate you guys.
