The Paradyme Shift
Step into the evolving world of real estate investment with "The Paradyme Shift," a podcast hosted by Ryan Garland, the visionary founder and Chairman of Paradyme. This show is your gateway to uncovering the strategies, trends, and success stories that redefine the real estate landscape today.
On "The Paradyme Shift," each episode takes you behind the scenes of Paradyme's groundbreaking approach to real estate investment. Ryan Garland, alongside industry leaders, dives into the intricacies of Paradyme's holistic model—covering everything from direct lending and strategic investments to hands-on development. Discover how Paradyme's innovative crowdfunding platform and investment management software are not just tools but game-changers that are reshaping real estate by bridging housing gaps and nurturing community-driven projects.
Tune in to "The Paradyme Shift" to explore how Paradyme consistently delivers exceptional financial returns while positively impacting communities. This podcast is more than just about investing—it's about leading the charge in real estate innovation. Join us to stay ahead of the curve, gain exclusive insights, and become part of a community where expertise meets transformative ideas in real estate.
The Paradyme Shift
From the Pentagon to Barn Caves: Institutional-Grade Design Meets New Construction Tech | Webinar E32
Join Ryan Garland, Founder and Chairman of Paradyme Companies, alongside Steven Biegel, AIA, Director of Architecture and the architect behind the Pentagon remodel, for an in-depth investor webinar exploring the design and development strategies behind Barn Caves and The Gym.
This exclusive session will dive into how Paradyme approaches large-scale projects with institutional-grade standards, from architectural innovation to construction technology, giving investors a rare behind‑the‑scenes look at what makes these assets unique and built to last.
Key topics include:
• The architectural design of Barn Caves, The Gym, and the integrated parking structures
• How new construction technology is transforming speed, efficiency, and cost management
• Fire protection systems and advanced building methods that meet institutional requirements
• The key differences between steel building and lumber (stick-built) development methods
• How these choices impact longevity, safety, and investor returns
• Real-world insight from Steven Biegel, AIA, whose experience includes the Pentagon remodel—lessons learned at the highest level of design and construction
Whether you’re an active investor looking to understand the details behind Paradyme’s developments or someone interested in the future of real estate design, this webinar will offer valuable insights into how we institutionalize projects from the ground up.
Don’t miss this opportunity to learn from some of the best in the industry and gain a deeper understanding of how world-class design and engineering drive value in every project.
Well, hello everybody. Ryan Garland here, founder and chairman of Paradigm. I want to thank you all for joining us today. This is our biggest webinar yet. We did a lot of marketing for this. And I'm excited to introduce you guys to uh Steven Beagle. He was on one of our webinars in the past. But as the Barn Caves project and Paradigm uh continues to grow, we thought it was imperative that we continue to add value to our network and kind of cross-pawnate on some of the other people that have been wanting to see how Steven operates, how the barn caves have been developed have been developed, and how we kind of came to light about the design. Now we actually are going to get it built. Right. And so Steven is here to kind of take the mic here for a little bit, but I wanted to let you guys all know, for those of you that have been watching me for many years, yes, I do not have a beard anymore. As most of you know, Joe Diesel, my videographer, I lost a bet. And so I had to cut down to this nice little mustache. So if you guys are laughing at me, that's okay. I accept the laughter because I did lose a bet, but I do get out of a lot of uh tickets. So that's at least uh the upside. So, well, Steven, thanks for joining us today, buddy.
SPEAKER_00:Thank you, Ryan, for having me. And thanks to the Paradigm team. I have been with you for the last 48 hours and it's been really fun. There's a lot of energy here, and we're just delighted on behalf of place architects, we're delighted to be partnered with Paradigm. And you know, when we started out a year or more ago, the energy level that's at Paradigm was so consistent with ours and the philosophy. You set a goal, you get there, and you establish the next goal and you keep climbing the ladder. And that's what we see in Paradigm. And we do the same thing. We do the same thing. So we're aligned in a partnership that I really like.
SPEAKER_02:Yeah. I thought the energy was perfect. And when we spent some time together, like early on, when I came out to Texas and spent some time with you, I really, I really got to understand more of how you operate, but you're kind of a workhorse. You just don't stop working. There's no way, you really just don't. And that's really the name of the game here. You know, people they they go, oh, I'm gonna take my nine to five, and this business is not a nine to five. This is basically all in or nothing, right?
SPEAKER_00:24-7.
SPEAKER_02:So today, guys, uh, this is gonna be, you know, a little more of an introduction. I want uh Steven to kind of share with you guys his background, his pedigree. And then we're gonna kind of dive deep into the barn caves. But what we want to do is is uh kind of give you guys again the background and let them kind of start from there. Um, and then I'll I'll I'll kind of tee off a little bit on myself. But uh for those of you that don't know, in 2008 is really how I cut my teeth. I've been in a space well over 20 years now. Started in the mortgage space, uh, really got into the distressed assets in 2008, you know, kind of just was organic. Ended up meeting and rubbing elbows with the family office that had about 40 million a month. He was looking to me to put out and start acquiring distressed assets, repurpose them, uh, do workout turnarounds, get them back on the market, sell them, rehab them, whatever it took to kind of buy low, sell high. So I really learned the game from some very sophisticated people that have been in the space for you know 20, 30 years prior to me even starting the game. And so that really kind of got me into where we are today to kind of have more of a conservative look, not knowing, you know, which way the world's gonna go. Um, I know we all live in fear, and everything that's gonna happen the last few years is kind of scary. But I think what happens is when you have a lot of people come together that have experience, you guys can hedge against risk. And that's really what it comes down to is to try to add value to not only our personal lives, but our our clients and our friends and everybody that really rely on us to make good decisions. And so, you know, we ended up kind of getting into the stress space. That helped me kind of look at things from more of a conservative lens. Now I have an underwriting background, so I'm kind of scrutinizing everything I get myself into. And uh, and that's really how we got to where we are today. So at the time back then in 2008, I was doing about 150 short sales, lease lease back turnarounds. Uh, I ended up selling uh one of my uh divisions to another uh operator that kind of took that to the next level. But it was really kind of nice that even from back then we had kind of shifted the paradigm shift, and hence the name paradigm, into you know what works and really being able to pivot uh pretty and be a small firm, but be able to pivot when needed is really important. So that's really the the brand and the culture of paradigm is being able to shift and then you know forecasting potential problems and how to hedge against that. So one of the big things is being aligned with the right people. So with that said, let's go ahead and get right over to Steven. Stephen, if you don't mind, share a little bit about your background because I will, I mean, I'm good at it. You are a better guy.
SPEAKER_00:You are. Well, I don't know where to stop, so cut me off when I get going. This is 45 years in the making. So uh I uh actually, you know, run the architectural division of place designers out in Texas, based in Round Rock and secondary office in Houston. We have a great team, and I'm very happy with their work ethic and the fact that we've been able to align with paradigm. So uh having said that, I'm gonna talk to you a little bit about my book. You probably see it in the frame. Uh back in 2023, I published this book entitled Profit by Design, and it was intended to give students of architecture some notion of how to be in business as an architect, as a designer, even as an engineer. Because when I got out of school at Syracuse University in 1978, I hadn't had a clue and I went through the struggles. So this is intended to help. So now, you know, Stephen Beagle as an architect. Uh I used to uh run a firm called Matrix Settles, and in that context, we had a contract with the Pentagon. So I'm gonna go through a few projects just as credentialing mostly and talk about institutional design. So here we are, the Pentagon. It's a fun story, Pentagon 1941. Are you going to show the story that we talked about, by the way? You want me to? I really kind of do.
SPEAKER_02:I was hoping you're gonna get, I know we didn't really even brief that much about this, but at least I'll get there because that's the best part.
SPEAKER_00:I can get there. So for for those who know the Pentagon, it's five sides, right? Five rings, five stories. So the Pentagon is five of everything the A ring, the B ring, C ring, D ring, E ring, uh, from inside to out. But it's a five-story structure. The interesting part in my involvement at the Pentagon was uh from 1995 right up until the attack on uh 9-11, I was in charge of renovating the building. So what we did back in those days for a company called URS Grinder, we had a contract to bring more space out of the basement. And for those who don't know, five wedges, right? The three wedges that are closest to the Potomac River are a lot lower. There's a full basement under three of these wedges. And it was a nasty space. You know, in 1941, the Pentagon was finished. It was just before the World War II effort, and this was taking the old War Department, which was across the river in the old executive office building next to the White House, and bringing all five of our military agencies over here. So you've got Army, Navy, Air Force, Marines, and Coast Guard, the five wedges all in this building back then, built for 16 million dollars, built in 16 months with 41,000 piles under the building. And here comes the fun part of the story. Back then, the basement, the three wedges, uh had a ceiling height of about the basement had a ceiling height of about 20 feet and half tranks and tanks and troop carriers were all parked down there on the slab on the Potomac side. So when it came time to renovate, the Congress, our U.S. Congress back in 1993, passed a$1.2 billion budget to renovate the building. And of course, you renovate from the bottom up. Now bear in mind the Pentagon houses 30,000 people 24-7. And it's uh has to maintain be maintained. The operations can't stop. So how do you renovate the basement and have and have the building functional? So here comes the story that's most fun.
SPEAKER_02:I was hoping you're gonna say it.
SPEAKER_00:Our goal was to go into the basement, repair the old slab, basically tear out the basement slab, and lower that slab by one meter, three feet effectively, gaining us enough space to put a mezzine level between the base the new basement floor and the existing ceiling. So the way that works, and you can see the slide to the left, you we had to uh tear out everything, lower the grade, uh pour a new slab, uh jacket the columns, and then put the interstitial space, the mezzanine level in. So we recouped 350,000 square feet of space. And that's a lot of space. You know, when the Pentagon was built, it was six million square feet under roof, you know, conditioned space, six million square feet, which at the time in 1941 was larger than the Empire State building. Empire State was finished in 1932, just under six million square feet. So the Pentagon at one time was the largest office building in the world, just space under roof. And here we were adding 350,000 square feet. Here comes the fun story that Ryan really wants me to tell. So this would go back to about 97, 1997. Uh, we were about to pour concrete in the in the new basement slab. We had concrete trucks lined up, Route 110, probably a dozen trucks. And people were down there putting rebar in and you know, grating. We had we had dozers in the bottom. We were trying to get the concrete out of the trucks and into the new slab. Well, one uh this is again three feet lower, we're close to the Potomac River. It's quicksand down there. It is nothing but silt loam and it was saturated. It turned out one of our D eights that was moving dirt and trying to get out of the way got stuck in the mud in the area we were supposed to pour. So the fun part of this, I remember his name, Captain Mullens. There was a captain who was part of the Corps of Engineer team. He was in command that day. And so we could not get this D-8 out of the mud. It kept sinking. So he made a command decision to take that D-10 over there and run over the top of the D-8 and smash it down into the mud. And after three or four passes, that's what happened. They laid the rebar over it, poured the concrete, nobody knows that there's a D-8 down there. So um we did that, and months later we uh get a call. Months later we get a call, six months later, in fact, and they said, Steven, we got a problem. All the new toilets in the basement are backing up. We've got a problem, sewage I'm wrong, running across the floor. So we camered the line, and it turned out that D eight had been smashed on top of a 96-inch steel sewer line. And there you have it. So we had to go in, cut the new floor out in the dead of night, and send people down with acetylene torches to cut out these yellow pieces of caterpillar, bring them up, repair the pipe. Nobody knows.
SPEAKER_02:And this is a sewer line.
SPEAKER_00:This is a 97.
SPEAKER_02:The sewer line of the entire Pentagon.
SPEAKER_00:33,000 people, 24-7.
SPEAKER_02:So a D9? Would you say it was a D8? D eight 56,000 pounds?
SPEAKER_00:56,000. Wow, and it and the D10 is a larger vehicle for sure. But that was uh that was one of those stories that never gets told uh until now. Gotcha.
SPEAKER_02:So, all right. So obviously, how long did how long did it take for you to renovate that?
SPEAKER_00:Well, we were right up until 9-11. Uh, we were in renovation. We had spent out of the$1.2 billion, we'd already spent$750 million, and we weren't out of the basement yet. So I'm I'm on the one hand, I didn't want to go back to Congress and explain why, but then 9-11 happened and and they threw the kitchen sink in after that.
SPEAKER_02:Yeah, they did. They wanted to recover that, right? All right, perfect. You want to talk a little bit about the Federal Reserve? Oh.
SPEAKER_00:Yeah, um, Mr. Powell has money invested here renovating the building, but the story I have is very brief. Back in about uh 2004, uh we had the we had the contract to put security into the Federal Reserve. And part of that task order as architects and engineers is to, you know, figure out the threats and where they're coming from. So we actually had to hire snipers at night to lay down on the mall, in the on the United States mall, and see if they could get a line of sight into Greenspan's office. Greenspan was chairman at the time. So those kinds of studies helped us reinforce the windows. Uh some of the windows were awning windows that opened and closed like this, so we had to make sure that those lasers couldn't come between the panes of glass, and we bulletproofed the glass. So it it's fun for me to watch now. We renovated this thing in 2004, and here we are doing it again.
SPEAKER_02:How much was it though? Hecking O point.
SPEAKER_00:Well, that's about 11 million just to harden the front. I think it's 2.2 here.
SPEAKER_02:That's a whole nother level. I want to be the contractor.
SPEAKER_00:2.2 billion.
SPEAKER_02:Yeah, I want to be the contractor. All right. So let's go on to uh let's go on to white cap, which is really interesting because uh Steven had brought something up to us that uh, as for for those of you that don't know, um, we actually received a term sheet for JP Morgan for 87 million, which I'm gonna bring up to you in a little bit. What that means is that we have a kind of a different problem. Now we have money to spend. Right. Now we got to find the right uh land and the right developers and all the right stuff that fit the caliber uh and metrics that we need to follow for uh bar caves. But this is really kind of neat because I had no idea this existed or was even in your pipeline. So please share a little bit about White Cap.
SPEAKER_00:Yeah, White Cap NPI, this is located on North Padre Island, basically at the foot of the JFK Bridge as you cross in to uh to North Padre. So it's in Corpus Christi on the south side. What happened here is that uh uh there was a bank involved, IBC Bank had taken the property back in a foreclosure action, and uh we tore down the Slitterbond, which was a water park, we tore down a hotel known as uh Waves Resort, and then we took a golf course back. So we ended up with about 300 acres. After that, we master planned 630 homes and built three miles of canals. And right now, today, we this has been going on for four or five years. Right now, today, we're coming out of the ground with our first five prototypes. So the housing was designed, and everybody gets uh a waterfront property and a road front. So the way we like to think of this is everybody gets two front yards. They have a front yard for a car and they have another front yard for a boat. So you have two front yards, which from a design thesis point of view drove us to go internal with the private space. So you basically have public space, public reception space, your semi-public space on the road, same deal on the back. Your private space is an elevator, in some cases pneumatic elevators, up to the terraces and the bedroom space and the then the more private spaces. But it was a cool concept. So we have 630 lots, largely 45 by 90, some are larger. And um, the thought that came up today is you know, why don't the barn caves go see it? Why couldn't that happen?
SPEAKER_02:And they're selling lots. That was the point.
SPEAKER_00:They're selling lots, and they're selling islands. We have 13 bridges that cross over. So some of what you're seeing in the upper right uh are a series of islands. But wouldn't it be nice to have a paradigm island?
SPEAKER_02:That'd be killer. That'd be that'd be actually really cool. I think I'd have to Airbnb out to all my clients, though. They're like, hey, if I'm investing, I need to get in and go have some fun. So the the takeaway for this, guys, is that the Barn Caves has really created, I'd say, enough momentum and um and it's very trendy. So a lot of these types of projects are being presented to us. Therefore, you know, we're looking at all kinds of different locations. Um, the term sheet, which I'll share with you guys here down the road, uh, really was identifying four locations uh for paradigm storage and the barn caves product. But I really thought this was neat because not only has you already been working on it, but this is kind of the that goes with the culture of what Paradigm's trying to create. And then when you look at the demand in the data for this type of product and kind of where the world's going and where people are spending their money, this is uh this is kind of right up our alley. So I thought that was great. Okay, let's talk about the fun one.
SPEAKER_00:Yes, it is one of the many fun ones. One of the many fun. This is so contemporary and contemporaneous. Um white uh the White Cap has been going on for about four years. Tierra on the beach is in Galveston, and also about four years in the making. It took us three years to get zoning approval to put this uh mid-rise 10-story uh condo building, 63 units, on top of a two-story parking deck to get out of the storm surge. So we had many, many technical requirements here. It took us a long time to solve the drainage and the storm water and um you know a number of problems. But we did it, and it's under construction now. So it's in Galveston 63 condos. We've sold about 20 from the last I heard. And you see on the right some of the renderings and the views that uh we're offering. It's it's right on the beach, in fact, 75 feet off the water. So that's uh and the next slide I think shows the construction portion of this.
SPEAKER_01:Yeah, some here. Yeah, so you can pop over. Nope. It's uh just a little bit air.
SPEAKER_00:There it is. So uh Ryan actually came out with uh with Joe and and participated in our ground bit breaking back in December. You know what?
SPEAKER_02:Yeah, and this is important too, guys. The reason why you we wanted to bring this to your attention is this is the type of product we want to see that Steven was getting involved in. Obviously, we hired him as one of our two architects, but we wanted to go see and not only support what he was doing, but also see all the network that kind of went on and kind of all the people that were associated to this from the type of contractor to politicians that were supporting this. And when you're doing something of this caliber and size, the whole city knows about it, and you really kind of have to get in and shake hands and kiss babies. So it was really important uh that we kind of saw the the the culture that was created with a product like this and how they're able to get the approvals. And it was pretty neat. And by the way, I I'm gonna challenge you a little bit on on the uh sales. I think you're low. I think Anastasia the broker, which I follow her, I think she said that it was like 38% sold.
SPEAKER_00:All right.
SPEAKER_02:It was I I may be wrong. Joe, will you fact check that for me? Go to Anastasia, go to uh Tierra on the beach Instagram and then look at Anastasia the broker and see if she posted anything about that. But I think I saw it just a few days ago. I could be wrong, but you they're selling units on constantly, it's like the reason I catch on to it is because my broker is selling units for paradigm stores like crazy. So I'm watching all those updates. I thought it was really pretty neat.
SPEAKER_00:So the statistics count.
SPEAKER_02:Yep. So the again, the takeaway on this was just kind of getting to understand a little bit about you know the background of of Steve and kind of how uh you know he gets involved in these killer deals. And as you can tell, the barn caves, in my opinion, was kind of uh, I would say kind of small apples for you. Uh, but it's important because when you're looking at it uh from a perspective of where we want to take the barn caves, we are trying to go national. We want to be in multiple locations. You want to bring on a good architect that, believe it or not, can actually save you money on the design and how you construct these uh buildings. And so, really, you want to have the right team, and you're really even though it may cost me a lot more. This guy's really expensive, just so you know. So if anybody wants in, just know you're writing a check. However, the amount of money he saved on the design has been huge. So, in in theory, or actually not in theory, but in facts, if you were to look at you know, DR Holton Polte homes, they're basically just stamping these things out, right? They just change the exterior up a little bit, maybe some the uh some interior walls, make some different layouts, and then they just go and print these things out. That's really kind of been our model because the beginning of the barn caves was really set up in a way where we didn't know which way the market was going to go. Because we started this before the elections, right? Two, three years ago. Really kind of the idea was three years ago. So when we went into modeling this, it was about hey, if things got worse, if inflation got worse, and you know, things just overall from the economy side got worse, we wanted to be able to still print these up because people need them. And then we were looking at public-private partnerships, going after maybe some government contracts, um, and ultimately it's just morphed into what it is today. So we really went into this in a in a way to try to take this into multiple uh uh locations and and uh spots across the country. So we wanted to do it right, and obviously you got to do it right by hiring the right people. So, with that said, uh, this is really neat because this is uh kind of the whole point. Let's get into the design features of the barn caves. So this is what I think everyone is here for, just because they want to hear now how the hell is the barn caves getting so much traction and so much interest? And of course, I got to give uh a big shout out to my marketing team. It's really their uh it's my vision, but then they actually make it happen better than what I ever expected. So shout out to my sales team and marketing team.
SPEAKER_00:Um let me let me jump in here and give credit where credit's due. I really like doing this. You know, the the the whole thesis here, I think the concept was originated by Ryan and by Rob Sampson over at um uh Sulberg and Associates. That's his firm. So Rob, uh, you're getting credit where credit's due here if you're on. I think Rob is on. Okay. So uh and uh by the way, no project is too small. Let me make one comment about you know relative size of projects. Yes, we like the big ones, but the little ones have character and and sensitivity and texture, and we love doing it. And from my perspective, I don't like designing something that gets rolled up and sits up on a shelf. You know, architects get their jollies when it gets built and you can point to it and get in a car and go visit your children. I consider every building I've ever designed to be a child, they're static, but every time I get off an airplane, I go check on my children to see if they're still there. And here we are 2,000, maybe more projects later. Every project counts and gets treated, you know, the same way. We want them built.
SPEAKER_02:So when we went into the design of this, of course, and thank you for saying that, because Rob did help me a lot of the original design. I went to him and was saying, hey, okay, because just for you guys, uh, so you know, uh, we are sitting in a paradigm storage man cave right now. We have two, you know, three-ton air conditioning, we have the huge golf simulator over here. We've kind of man caved this out, and what we've caught on to, especially with the culture here, is how people really desire going to another place and having something that's like living space without paying for the living space. And then you could store all your toys, and you know, people are buying these in 1031 exchange to rent them out for cash flow. I mean, the product itself is very institutionalized, which I'll share with you guys down the road. However, what's happened is knowing that the world's changing so fast, and just to kind of can make a connection real quick, if you guys kind of go back to like let's just say 2020, the pandemic, like I think this is when it kind of really started for me. Things were were shifting so fast in everything, whether it's politics to you know, income to finances, to you know, pregnant money, to you know, this thing is it was just if you the technology, social media, everything has grown and changed so fast in the last four years. I knew that was now the new momentum. When you watch like things that are going on politically, you're watching, you know, they're these they're working seven days a week. They don't stop working. They're having meetings on Saturdays, they're having meetings on Sundays, they're pushing out bills Sunday night at seven o'clock. I mean, it just never stops. So things are moving so quickly that I knew that we needed to have a big focus on technology in these units because people are going to want them. And I'm part of the the Da Los crew, right? The health and wellness side of things, um, which has circadian rhythm lighting, uh, hospital grade air filtration, uh, uh water filtration. And I started really tracking how they how they acquired certain companies and really the data supporting, you know, people's um they like for example, that we're in synthetic lighting, right? And we all know that this light blinks really quick. That actually has, they have they have studies now that has a direct effect on vast synthetic light on, you know, your digestion system and you know, let's say your melatonin and all these different things. So what they try to do is bring in the more synthetic, or not synthetic, but the circadian rhythm lighting where it's actually the lighting of the sun and it eliminates a lot of this uh bad stuff. And so it was, I know that's a little nerdy, but I knew that that's where the world needed to go from. So uh all the way down to fire suppression with everything that's gone on with the fires, um, you know, going to steel building uh methods instead of stick-built methods, kind of where the world's going is what we try to do is take all of these things and every aspect of the development of barn caves and and came up with what we came up with today. So, with that said, I'm gonna turn it over to you because I know you're allowed to talk about this stuff because I put it all on your plate.
SPEAKER_00:So this has evolved ever since it originated with Rob and Ryan. This has evolved into two prototypes, two different sizes. There's a large one that is 40 by 90, and when you stack that on three floors, it's just over 10,000 square feet.
SPEAKER_02:Real quick, I don't mean to interrupt. For for those of you that are either current clients or going looking to invest into barncaves, this is a much larger uh product. I think I've shared with most of you. I'm actually planning on doing multiple floor plans where people can actually buy these and plop them down on a lot anywhere around the country. So keep going, please.
SPEAKER_00:And that's important, and we'll get to that in a second. There's also the smaller one that is being built in uh in Lake Havasu City. That's the 28 feet wide by 72 feet. Now, to Ryan's point, what we have done as a framing system, and we're trying to systematize this so they can basically be shipped on a trailer and erected in a single day. This is the IKEA version of a man cave or a barn cave idea, and we've we've solved a lot of problems in our discussions over the past many months. The idea principally is to span out to out, exterior wall to exterior wall with all of your horizontal floor plates to free up the space on all three floors. Obviously, it has to be freed up on the lower level where the vehicles and toys are parked, but even above, if the structure does what it's supposed to do, that gives you maximum flexibility to change interior walls and interior layouts because the primary structure is spanning out to out in a 28-foot direction. Now, to that end, systemization is is the goal here because we're doing what 80 some here in in Havasu?
SPEAKER_01:93.
SPEAKER_00:93. So right away we need 93 of these. So what do we do? The structural system uh is out to out, but it's also modular. Every 12 feet there's a column. The columns are three stories tall, eight inch uh uh square sections, and the floors are hinged. The floor beams are hinged, so you everything ships on a trailer. The the horizontal beam clicks up, uh it and the one on the opposite side clicks up and they bare into a saddle plate, and it's easier therefore to erect. It's all about speed and convenience. But if the package can ship on the back of a trailer anywhere in the country, these things can go up quickly.
SPEAKER_02:So uh the bolt onto that safety. Yes, safety and construction defect issues and all that fun stuff that goes along with it.
SPEAKER_00:And they're they're mostly steel frames. You know, the wood, the wood doesn't need to be there. The only technical issue we've had really has been a code-related issue because you're not supposed to sleep where you're keeping cars that have gasoline in them.
SPEAKER_02:I say it all the time, don't tell anybody.
SPEAKER_00:So uh you know there's some fire issues. We have to have a one-hour fire separation between the lower level and the upper level. And we think we've satisfied that. We uh we have a system that uh allows for the one-hour uh you know fire resistance, and we have some interesting other features that we can go to uh to talk about some new technology that we've entered into. So if you can see the slide on the left, every 12 feet there's a column, uh, the panelized flooring, so that gives you 12-foot flooring sections that can be aluminum, they can be polycarbonate, they can drop into place to make it uh to make the ease of construction and speed of construction um you know faster and easier.
SPEAKER_02:No, sorry, and just keep in mind, guys, we would the reason I like the three-story product, we were we were trying to get more of a high density. This is here for uh Lake Havaso, we were trying to get more of a higher density kind of product where we could bring down the cost of homes here. Uh, but it it kind of turned into this. When you look at some of these barn dominiums, I'm sure you guys know exactly what I'm talking about. If you follow stuff on social media or Google it, they have the technology and how to build these things are so impressive that it's a it's a it's some of the most beautiful homes in the world, I think, are built out of steel buildings. I mean, it's unbelievable. So um, you know, and it's trendy, you got you know, NFL players buying stuff and building stuff. I mean, it's wild. But what we wanted to do because we're currently finishing uh another three-story product, right? So we have the San Antonio project. I mean, we had uh a three-story product, which is a town home, three stories, just like this, but they had shared walls and had a pitched roof. And that thing sold like crazy. We started before the pandemic and ended in the middle of the pandemic, so the market was hot. It did real well. So what a blessing there. But uh, we were we're familiar with three-story products and we also familiar on how to make people feel comfortable, no matter what age you are, to be able to migrate around your home and not make it feel like it's a 6,000 square foot one story. You can kind of get around all of your your space. And I'll kind of add you know, one more thing, and I'll give it back to give you back to Mike. I when I had I moved uh I moved just a little quick story. So I moved my headquarters uh out of Southern California into Nashville. Uh we I officially moved in early 2021. We started migrating in 2020. And um when we made that move, uh, I realized just kind of how the barn dominion movement just became so big on the East Coast. And for those of you that know this, I also manage a$100 million debt fund. So again, my background on the lending side, uh, I manage a debt fund for hard money lounge, ground-up construction, what have you. And uh, and so I really picked up a lot of originations for people that are building build uh barn dominions. And at the time I didn't really know what it was, but I'm like, I don't know if I can finance these things. But what you wanted to do is confirm through insurance if you can get a regular homeowner's insurance, a standard policy with the right things, right? And if you can, they're gonna insure that house. So then I can lend on it, right? And then you can look at it from a conventional side and what have you. So it was just, it was just it was seamless. But but but concurrently, when I moved my headquarters to Nashville, obviously the this is before the office space really got hit hard from like a balance sheet we fakes. And uh, and so we all the idea was to kind of go out there and kind of get a seal as where I want to open an office. I rented a little apartment downtown. I was on Broadway at Whole Foods at the bottom of my my my unit, actually 1200 Broadway. If anybody wants to look it up, the rent apartments. And uh, and what I did was is I they have a parking structure, it's five stories. And I went to the very first uh story for the parking structure and got a parking spot as close as I could to the elevator. And I I when I would go up the elevator, I'd take maybe five, six steps off the elevator and I'm right into my unit and I'm dropping all my bags and everything I have right there on the on the island for the kitchen. And I it made me feel like I wasn't inside a big high-rise. It made me feel like I was literally my little home, you know. And I wanted to create that feeling here where, you know, yeah, you're buying a three-story property, it's it's fun, it's great. But living in something like that is also something you have to consider. Like, would you actually enjoy it? So we try to build certain things and and and certain features of the property to make you feel more comfortable as if it's a regular standard big home, um, but without having to have a big, big home, you know, cheaper to clean, easier to maintain and run and what have you. But anyway, so that's just gonna give you an idea. We'll talk about the elevator here in a second. But that was one thing we wanted to do was implement some of those experiences to bring that kind of more uh comfortable feeling to the space.
SPEAKER_00:So so there's a history to these kinds of efforts, you know, to systematize housing. There are lots of different ways to do it. And uh I reach back in my memory in the late 60s to Operation Breakthrough when uh then President Johnson, you know, authorized a lot of money to be invested in how do you build housing more cheaply. One of those theses was you turn the studs flat, so you flat stud the walls. And then you recall Sears and Roebuck took it on, and for$5,000 you could order a house from Sears and Roebuck, but it was a panelized house as cheaply built as you could possibly build anything. Uh storage units are better to open those. Well, U.S. plywood and uh you know all all of those organizations back then got involved. I mean they wanted to build more housing as cheaply as possible. But then then it evolves. You know, that evolved into the the um yeah, the trailers, the basic uh hate I hate to call them trailers. That's a bad bad word.
SPEAKER_02:But that's how they get there.
SPEAKER_00:Manufactured housing. So then what happened uh in the 70s is the National Manufactured Housing Association showed up, and now you could haul your house, get it pre-assembled in a factory and haul your house. So this this concept of a of a systematized metal structure that is flexible and easy to build is the next generation of that concept. And this one happens to include all of your toys and all of your um you know pleasure items are in one structure. And it's uh because it's modular and because it's narrow in width, it can be built quickly and maybe even shipped on two or three trucks the same day and at least staged on site. And then there's new technology. You know, uh in the 80s I had the pleasure of running the National Institute of Building Sciences, and one of our missions was take something new he just told me now. I didn't know in 1980 to 85. So one of our missions was you you take new technology ideas and you transfer them into construction. So that was during the time when plastic pipe PVC was being dealt with, and you know, all the people who did not uh all the people in the in the iron industry and the metal pipe industry who didn't want plastic pipe were struggling politically against it. But technology transfer happens and it's happening even faster today. There's so much new that's coming into the marketplace, and people are getting new patents to adopt something or adapt something even out of NASA and try to bring it into construction. So this is where we're going. Why don't we look at some of the links here that show Yeah, I don't know.
SPEAKER_02:For whatever reason, I can't click on it. Uh whereas I tried earlier, the solar panels.
SPEAKER_00:Just talk on it and then we'll fix it for that. So you know, this whole idea of photovoltaics, there are good things and bad things. One of the worst things for architects and engineers about photovoltaics is you have to have a rack that sits on a roof or sits on a horizontal surface, or if you have a slope surface, you have to figure out the uh the right angles for the best you know solar gain into the photovoltaics. So we've been what we've been waiting for the day when uh a photovoltaic mat uh can be produced, like a TPO roof that where you roll it out and it will capture the electricity and do the same thing that the photovoltaics. Well, now it exists. And one of the links we were going to show you is is how it exists, how it gets used. It can even be glued to the vertical walls on the outside of the structures and collect solar radiation. So there's that as a a new a new technology that has a presence and a place in the barn caves. Then we go to the issue of fire protection that we touched on earlier. There are new robotic sprinkler systems that uh like this a lot, by the way.
SPEAKER_02:I'm gonna cut you off, but this is impressive.
SPEAKER_00:So and it's been tested in various uh other countries. Uh it's it's new here, but you have a robot attached to the ceiling. It's basically a cannon and it's on a it's on a sensor. And if something is happening in the space, if a fire is going on in your in your toy room downstairs, it finds it, it comes around, and it shoots it out. And if you have three or four of those in your barn cave on the lower level, even on the upper levels, uh, it saves you the price of of sprinklering the entire structure. So the idea is to save money, but the idea is to is to take a technology that is a robotic technology and put it in the building. So it's kind of cool.
SPEAKER_02:And even a deeper dive, you know, that's kind of a construction, let's just say an insurance play, you know, because let's say, for example, you have usually one fire sprinkler were to pop, all of them count. So therefore it's damaging the entire property. That's right. If you have if a fire starts in a corner of a property or in a home and you have this cannon shoot me down on it, you're a couple things happen. Correct me if I'm wrong. The water pressure stays focused on one direct one spot. So if you're gonna get more flow, that's gonna be directed directly at that uh fire. And then obviously uh alarms and it notifies everybody in the house and you know, the uh fire department, what have you, and that can keep that that uh make either put the fire out, suppress it, give you more time to get out, the list goes on. But it also, if you can get the fire out, whatever needs to be fixed, just the damage of that location. You know, your insurance premium, not your premium, but your uh uh what do you call it when you have to make a claim, there's much less. And so insurance companies are going, okay, we like this technology because that's gonna save us money at the end of the day.
SPEAKER_00:And there's a lot to say about that in our next series of slides. But other than other than the robotic uh, you know, canon, there's also a whole new series of materials that have come into play. Polycarbonates are now translucent or even transparent. And what we've what we've worked into the idea here with the Barncape is to have floor panels uh that are translucent in the one-hour fire floor. So we've solved those problems. So you can stand in your living room with cocktails and entertaining your guests and look down and talk about your toys. So, or at least keep an eye on them so that they don't.
SPEAKER_02:For those of you that know me, they're like, of course, Ryan wanted something like that in there. Of course. Okay, if the cost doesn't go up and it's it's uh something everyone can talk about too, it's a good point.
SPEAKER_00:And I'm sure everybody's been to an airport where you're walking across a glass bridge or a glass floor, so it's not unlike that. But to integrate it into at least the lower level and the upper level too. You these have elevators, so you you come up in the elevator, you step off into the living area, or you step off into the bedroom level. You can look down and see where you are, and you know where you are. But it's a cool technology that I think has a place in the barn. 100%. Talk a little bit about the paneling. Oh, yeah. So the paneling that we've there's options there, lots of options.
SPEAKER_02:So, in essence, guys, this is buttoning it up, right? So we talked about the structural family. I mean, just different down a bit. We talked about the the uh the structural component, right? What we're talking about now is is closing it in all the all the out exterior walls.
SPEAKER_00:Yep. So uh we've had good experience with several uh different systems. One of those systems is called Kingspan. And the Kingspan product is self-insulated or it comes it comes totally insulated in in three-inch, four-inch, five-inch, six-inch panels, depending on what climate you're in and what your energy code says. But they they go up quickly, they're full height from ground all the way up to to where the roof bears. And again, speed of construction, energy conservation, buttoning up the building. There are other uh systems. A lot of them are like hardy plank, a lot of them are hardy panel. Uh we've had experience recently with what's called Michiha. Nichiha sounds Japanese and it's a Japanese name, but it's manufactured in Georgia. So it is a cementitious, it's a cementitious siding material, not unlike uh hardy plank, only a variety of different shapes and colors and more textures. So depending on where you are and what what image you want for your barn cake, there are options.
SPEAKER_02:You change colors, you do all you get all your walls basically pre-built. You know, so ultimately, you know, you can see where you could save money overall. It may spawn a little bit more money in materials, but you can save money overall because while you're doing your horizontal improvements, you can have these things being built. So by the time your slab is down, you're just you're putting these things together. And that's really kind of a whole entire point is how can we cut costs, minimize trades, minimize risk, focus on costs. The thing that I love about the paradigm storage is I talk about it all the time. So for those of you that have heard me say this, forgive me, I just like to talk about it. But you know, my paradigm storage that we're sitting in, it's uh 225,000 square feet, 208 units. We have like, I don't know, some what we have like 500 air conditioning in the wild amount of numbers. We give you guys it's everything, there's a lot of everything. And I believe when you got down to it, it was like 58,622 pieces. It's something of that nature. That's including all the screws and the paneling. When you look at it from that perspective, and you can get down to those types of numbers, you know your product so well, you can really narrow down your costs, right? You can hedge against certain problems, you can call different manufacturers, you can start working certain deals, and you can start value engineering this thing over and over and it never ends, by the way. Uh, but that is something that we wanted to try to implement is how can we mitigate risk? How can we make sure we know exactly what we're getting ourselves into? If we know exactly the material, how much the whole thing weighs, right? How much steel do we need? All of this stuff that's required to be a pro a really proactive and well, you know, a well-put-together operator, I think would need. We wanted to implement those practices, and the barn cave really helped us get to that as well. So, what you guys see here too is just uh our groundbreaking event. Mr. Steven was here with us as well for that, which was amazing. We had a lot of support, a lot of existing clients, new clients. Uh, this 18 acres where the barn cage is now is right next to this project that we're sitting in paradigm storage. So we own, what is it, like 30 something acres over here now, 34 acres, I believe. So we own a bunch of acreage over here. And then right across the way, which I don't think I have it on there. No, I don't. But right across the way is uh the airport, which they're talking about expanding now. Uh in fact, we have been approached and had talked to them about possibly building their airplane hangers because they love the man cave stuff and that goes real far and we can help them there. Um, and then uh and then on the other side you have 730,000 square feet of retail, which includes a Walmart, Dillard's, some restaurants. There's a new Buffalo Wild Wings going in, movie theaters. It's it's kind of a new up and coming thing. They've they've had some headwinds uh when it came to 2008 when the project was finished, and then also uh uh with the pandemic, it was really hard, especially with this being so heavy in retirement. It's taken a little bit of time to pick back up, but it has, and uh, we're seeing a lot of growth. So that's always amazing. So, do you want to add anything before I dive in?
SPEAKER_00:No, dive in.
SPEAKER_02:Okay, so here goes. So I got the mic now for a little bit. Okay, guys, what you see on this slide. I know some of you are not uh able to look at your um uh screen or if you're on a phone, sometimes it's really small. I'll kind of walk you through this. What you see on the left-hand side, we circled this up with our uh current investor than clients. So we have about, I think, close to about 400 clients now on our platform. Uh more retail uh investors, accredited and non-accredited. We do open, we do have uh manage two uh public mini IPO funds called reggaes, which means we can uh take in non-accredited capital. With that said, the reason for that is because we wanted to be able to build something of value and uh and get people some good returns. But knowing that if we can get to a certain level, raising equity capital, we can go to go to JP Morton, go to a lot of more institutional banks, show them what it is we're doing, get into the weeds and how we created it. Obviously, having Steven and Selberg tied to this, their background, their track record really makes allows these larger family offices and institutions to make decisions. And then when you get into the weeds on how we're building it, how we plan on taking this to different uh locations throughout the country. Um, and then we have a track record in building steel buildings, you know, all of that goes a long way. So they were able to offer us an$87 million line. Mike, my CEO, is on here and he's smiling and laughing at the same time because he's trying to get that number like$300 million. And I'm telling Mike, hey, hold on, like slow down. I gotta go buy some properties first. We get to$300 million. Um, but that tells you there's a lot of potential. On the bottom here, which is gonna be really hard if you're on a phone to see, uh, they they have a mandate for us to uh develop uh three more paradigm storage projects, just like we're in now, and then one more barn cave. So two sites, uh Lake of the Ozarks, and then one in Nashville. I'm I'm strategically looking at a place that's out towards um old hickory. If any of you guys know Nashville, I'm gonna be in Old Hickory. Uh, there's a lot of growth going on. You could take the lake down to Broadway, it's a pretty amazing lake. Uh, and then another one in Knoxville. I'm looking at um uh Lake Norris. And I travel all around and I've been to these lakes and really just throwing up it. Um, there's some additional data here. Uh, for those of you that do know or may not know, there is a retail component to the barn caves. We have our phase one, which is actually a 32,000 square foot gym, uh, real modernized. What you see behind us is all the latest and greatest technology, even in health and wellness. And what we want to do is fill a gap wearing a kind of a different hat of uh the deficiencies of gyms and the culture and what they've created here currently in the city. We felt is just not up to par, especially for the people who travel here and are looking for just start focusing on health and wellness. I don't know about you, we're just talking about this earlier. I'm spending more money on my health, and you know, kind of with everything that happened just in the pandemic, I think a lot of physicians are telling their patients go back to eating clean and working out, you know, not taking so many pills, right? So um I see there's an uptick there, the data supports it. It's all showing here as far as the data. Um, anytime you had uh, you know, when you have uh financial hardship, you have more divorces. We track that unfortunately, but fortunately. Um, a lot of times you'll see alcohol sales go up. You also see gym memberships go up. So as the economy usually gets you know worse, gym memberships increase and and uh alcohol sales increase. So um you'll see some of those practices kind of hedging against risk based on how we're structuring this. Uh, but that's one of the things that you know I want you guys to kind of know we've implemented a health and wellness component to this. And here it is. Um, this is there's two things here on the left-hand side here, guys. Um this is a newsletter, uh, a newspaper here. It's called the News Herald. And there's two articles, and this is really important. One, it talks about our our project, the 18 acres and barn cairs, which is great. We got it in the paper, we've been in the paper a couple of times, and so we're we feel honored. The other one is is the right, and it's gonna be hard to see here, and I wish I could open, maybe I can zoom in. On the acreage at 623 acres that just sold, which is literally two left-handed rock throws away from me. 630 acres just sold to another large residential developer out here, and then he split that off and sold it to a guy who is developing North Point Viewpoint. And I don't recall exactly how many lots are there, but it's pretty much 90% complete, built-in, sold. And I think there's 300 or 400 homes over there. And right to the west of him, or sorry, go to the uh north of him, he bought another 300 acres of that 623. So you have two of the largest home builders now that just bought 630 acres right behind the mall, right behind Walmart. There's been all that retail. And uh, we're we're guessing there's gonna be close to about 3,000 units, uh, what a blend between residential, single family, and apartments, along with maybe some other schools and so forth. Maybe you put pushed over here. So I'll give you guys an idea of the growth corridor of this area. So, us being, you know, kind of on the forefront of developing in the space, you have to come and they're gonna improve some streets, but you have to actually go down this street right in front of Paradigm Storage and the Barn Caves to get to the site. Um, so it's uh it it just shows that we were kind of you know on the on the we we forecasted where the market was going, we played our cards right, and uh we struck a really good deal moving forward. Right here, what you'll see on the right hand side, uh kind of getting for you uh aren't uh aren't here, can't look your screen, I'll walk you through it. On the right hand side, we have slides that are showing uh basically it's a two-story building. But when you come off the street, the building is built into the hill, if you will. So we retain and we go down basically one floor. And so it's ultimately like it's actually like a two and a half stories. And uh the very first floor you come in, and we actually have a parking structure, which you don't show here, but there's a parking structure that's associated to this. And you kind of go down and around, it's the main entrance as well into the into the barn cave. So you have a glorious gate and all this rock. And you get if for those of you that know me, you know I'll go all out. But uh, you know, you can actually go in and park underneath into the parking structure, get away from the sun. Um, and then a lot of the uh the resident uh owners as well can go in and and come into the parking structure, go into the gym because the gym is ultimately the community center to the residential. And I'll I don't want to go too far into it how I came up with the idea because that's a whole other conversation.
SPEAKER_00:Let me let me talk a little bit about the gym. Um coincidentally, we just got the drawings finished and got the permit sets in this morning. So uh we're done with the design and it will will soon be permitted. And I wanted to say a special thanks to the team at place, you know, Laura and Chin and Troopti and Devin and all of those of you who were dis who were involved in the design. Uh it looks great and and it's it's gonna be fantastic.
SPEAKER_02:Well, it's uh I I have to agree. I'm gonna give you guys a shout-out too, because I keep changing things. You do. Yeah, but I know everybody else does. I'm not nearly as bad, I think. Just tell me. Just lie to me.
unknown:All right.
SPEAKER_02:So the the other part was is I uh a lot of people are on this that know what we're doing here, but we're actually trying to hang cars in the middle. A lot of people don't know this, but it's a marketing thing for us and it generates cash flow. So we can hang cars on a sled in essence, right over the main. And when you go inside, there's this big opening in the center of the of the first floor. Now, mind you, it goes back down into a second floor, you have more weights and so forth down there. We're working on getting one of Connor McGregor's actual um uh uh octagons and put it right down in the middle, and we have a car that goes above it, right? And then you have all your turf and all your TRX stuff, what have you. But we can put other cars up there where like you have the dealerships are trying to sell cars, they would pay us a marketing fee to put it on there. So everyone's like, Oh, you're putting a Lambo up there. I'm like, no, I just use that for marketing. That was a great marketing. Our our podcast went viral, but that was the point. Ultimately, there's ways to create income. And so I went to them and said, guys, I want to be able to hang a car from the ceiling. They're like, wait, what? I'm like, yeah, right here I want to hang a car and I need you to figure out how to do it. And they did it, and that was killer. So I really appreciate that. But that was one of the funny kind of conversations. He had to kind of mic check me a few times. Wait, said, Wait, what, wait, what? Did what do you want to do? So it's pretty funny, but uh, that was pretty neat. So um, all right, moving forward here, guys. Um, I thought this is kind of neat. Uh, really is kind of the future of paradigm, right? We talked a little bit about you know the the$87 million line of credit, kind of the future, you know, projects. I'm gonna go ahead and turn it over to Steven because he actually came to me with a really good idea. And really, the what was nice is that when we went into let me give a quick background. When we went into expanding paradigm back in 2017, then we launched the expansion in 18 to have this platform where you can go online and you can invest in multiple projects. The goal was to bring on other developers very similar to, let's say, CrowdStreet, uh, which is one of what we would, I would say competitors, but not competitors, but they they have a marketplace that investors can log in, create your own login, and they can invest their IRAs or what have you into all these different real estate developments. When you look at wealth management practices, a lot of wealth managers, especially during inflation and during certain times in the economy, people start leaning towards real estate. And when you when you are starting to worry about your money, typically people take back their money and they want to manage their own money again. They don't want to deal with wealth managers and fees. And you're seeing a huge uptick on that. Simply think about you know, Wall Street to Main Street, you're seeing a huge shift there. So it goes the only way down to the family, right? So what happened was is we wanted to create a marketplace to allow all these people across the world, really, because we can actually go abroad, to invest into US real estate. And then we would handpick, underwrite, and choose which projects were to go onto the platform. And based on our marketing techniques, strategy, and our target market, we would be able to build the awareness based on that target. So that was kind of funny because we kind of steered away from that and during the pandemic because we had a lot of offices and other retail actually on the platform. We pulled that back and said, you know what, why don't we just do our own projects? And that's how we ended up kind of getting to where we are today. So with that said, Thank you.
SPEAKER_00:Well, um, for the last year, Ryan and I have been talking, and you know, Paradigm and Place have been partnered up on a variety of different projects. And the notion and you know, the notion of I evolved out of a conversation. Why isn't the investment platform broader? Why aren't there more uh investment opportunities on the platform all over the country? So we started thinking about you know all of the initiatives that come to us at place, and there are many, and then all of the initiatives and and opportunities that come to paradigm in other locations. So and we have a few of those we're gonna we're gonna put out and discuss. And why not have multiple projects on the investment platform that people can target their investments into? So that's exactly what this next part is about. And here we are. This is in Memphis, Tennessee. I'm gonna say thank you to Philip Wonkey on the place staff for uh his efforts to put the slides together and and design this thing. We have uh approximately 230 apartments that will go in uh eventually to a property on Winchester Street in Memphis, Tennessee. It's an existing Section 8 housing project that needs to be torn down. So we're gonna scrape the site, save the trees, and uh and produce this three-story walk-up uh rather contemporary product, uh still affordable housing, still workforce housing. Some of can some of it can be J1, you know, visa housing. But uh Memphis needs this. And they're they're cooperating.
SPEAKER_02:And hence uh you you heard the the key word was affordable housing. So therefore we have to be affordable in building it. And that hence more of how we were approaching the barncaves, too. This is one of my favorites, but I'm gonna let you talk about it because you really spent a lot of time on this. I threw some ideas out there, and you came to me with this monstrosity.
SPEAKER_00:Well, uh, right here in Havasu. You you better describe how you got a hold of the land because I can't I can't go there.
SPEAKER_02:I can't say it just yet. It'll leak out though, I promise.
SPEAKER_00:So this is a property in Havasu near near the mall. Okay. So they're two parcels. Uh I think it adds up to what, 13 acres, eight and five? Eight and five. Yep. So uh the idea was to put uh an apartment complex on top of a podium deck, park it underneath, and according to the codes, you can go as high as five stories on a concrete podium deck when you're wood framed, as long as you sprinkle everything, including closets and toilet rooms, et cetera, et cetera. But what a great view from that property up at the pool deck looking out at the lake and at the river. So it has uh an opportunity. There's an opportunity sitting right here with retail across the street on the smaller piece on the five-acre piece. So it's self-sustaining in the sense that we uh we can walk across a bridge from the podium deck to the second level of the retail space, go to dinner, go get your coffee, go get your nails done. But it's a it's a two-part project, mixed use, both both retail and commercial and residential. But the parking on the residential side is underneath, and the parking on the retail side is out front, as in a normal two-story retail space. So it's here. It's one of those investment opportunities that is now on the platform.
SPEAKER_02:Not quite yet. Okay, all right. We're just gonna do a little bit more numbers and then we'll get it up on the platform. But this is actually something we're pretty knee deep in, um, or something similar like this, somewhere close. So if it's not going to be on this piece of land, it's gonna be on something right next to it. So ultimately, what we did is we backed into the demand, what the cost for rents would be, where people are coming from, workforce, all the things that you need to uh look at when you're underwriting any type of uh apartments. And obviously, you know what we're doing in San Antonio. So uh this was really kind of the idea. We love this, and and we actually met with the city, believe it or not, and the city really liked uh this project. Uh so that kind of opened up doors for us going, well, they're open to it. This is something we may want to continue to look down no matter what. Uh we've already spent money. So I think it's really important we continue to move down that road when we see the demand for it. Okay. Um let's move over to this. This is pretty cool. This is this is a pet project for Stephen, and then I'll I'll close the gap on someone else.
SPEAKER_00:Yeah, this uh this goes back a little ways, and this was you know, before I met Ryan and before I worked with place architects. Back in uh 2008, the uh the city of Houston and and Texas was inundated by a couple of hurricanes. But in September of 2008, a hurricane named Ike came came ashore in Galveston and wiped out uh most of the private single-family residences up and down Galveston Island. It was devastating. Um I had a building under construction then called Diamond Beach Resort, and we were five floors all concrete construction coming up out of the sand when the hurricane came through. So as soon as the National Guard would let me back on the island, I ran down there to check on my building. And thankfully, it did exactly like it was designed to do. The storm surge came in through the building, right through the building, all the way in inland, about a mile, and then came back out, and then came back in a second. So it flowed through the building. Just flows through the building because that's why you elevate these things. So Diamond Beach survived and did well, and I was very pleased. But the single family residences up and down the island were wiped by the room. Is Tierra built that way? Tierra, yes, Tierra is built exactly that way. We talked a little bit about it. We're above both both levels of the parking garage, above sea level.
SPEAKER_02:Because what's that little what's in between the street and the building? How much how there's been that flows through that too, right?
SPEAKER_00:Yeah, yes, there's a uh the ditch, yeah, the text. On the north side of the building, so the fire department can get there. It's it's designed to to not only survive, but to perform well in a hurricane. We have we have emergency power generators, people can stay there even though you're told to go. I mean, you're safe. The storm surge, if it happens, comes in and out. So here, the hurricane house concept is uh an idea that was that originated in 2008.
SPEAKER_02:And real quick, just so you know, when he when we did a FaceTime, he had to show me this thing. It was like our first FaceTime. He's like, check out this house. And I was like, what is this thing, by the way? So for those of you that are able to say it, you're gonna say think the same thing I thought it thought, but once you actually got into it, it was pretty cool.
SPEAKER_00:So you know, the thing about insurance companies is even if you're able to get insurance for floods and disasters along the beach, the sadness is you get enough money to rebuild exactly what you had the first time. There's no innovation, there's no there's no thought to make it bigger, better, you know, more secure. You end up having to do it over and over and over again, and insurance companies are paying out over and over and over again. So this idea was born from the hurricane, Hurricane Ike. It's a platform, concrete platform on stilts, on on Concrete piles and uh it it's on a it's on a basic uh track, a circular track embedded in the concrete. So it's a dynamic shape for the two-level house, still approximately 2,800 square feet. And the neat thing about this is it's designed to move with the wind on a polycarbonate rail and a series of roller coaster attachments, basically. You'll see it rotate here in a second. So when you're told to leave, you can leave. You can leave, but you basically pull the cotter pin and let your house rotate on the platform coming into the wind so that there is less damage. You still get the storm surge coming in and out underneath, but the house rotates and doesn't blow away. That's the notion here.
SPEAKER_02:Yep. And so remember when you show that to me the first time like that it's actually kind of cool. Especially in certain areas, like where where was that other one that uh the levees broke there and New Orleans. Yeah, New Orleans. That was rough. That was your friends out there. That was a lot harder to hear what happens.
SPEAKER_00:That was kind of like So I'm I'm looking to have a demonstration of this. We need to build a prototype and demonstrate how it works. But you know, in in a caustic environment like along the coast where there's lots of salt in the air and in the water, uh most of what is shown here is polycarbonate. The rail system would be polycarbonate, the the siding can be either Nietzsche Ha or some cementitious material, but the metal frame is internal, it can be an aluminum frame, but most of the component parts and the moving parts would be polycarbonate.
SPEAKER_02:Perfect. On to the next guys. And by the way, we're almost done, so hang in there. Okay. So this was kind of nice. Um, we've been our marketing has been so um effective that our CRM has just gotten bigger, bigger, deeper and deeper. And what we're catching is that people just have this diversification mindset right now, as they should. And we are continuing to see issues um from operators trying to find debt and equity, really. Not just debt, but equity. And debt obviously has been an issue because cost of uh construction is high, uh, interest rate, cost of capital is high. Uh, equity investors are kind of holding back, kind of waiting to see how the market's gonna do. I think most people believe we're on a tailwind here. Um, and so we've been presented by I I couldn't tell you, I would say maybe 30 deals a year that I think actually have legs where we will put up on our platform and start building awareness with typically Family Office or allow our investors to get involved too as well. So this is a project that uh that Stephen's been working on. We have been working on figuring out a way to get it onto the platform. And uh I did mention today on social media that I will be going to Dubai. I have been involved in a family office uh network in Europe for many years. In fact, prior to the pandemic, you know, the pandemic it kind of slowed down a little bit, but they offered me to come speak in Abu Dhabi. Uh, I will be out there in the beginning of November. And so a lot of these investors that are abroad love U.S. real estate. And uh, we have a history of pulling money from family offices out of Monaco into one of our funds here in the US and deploying it and then returning capital. So we have uh we have the right council and the right vehicles. So we're gonna be going basically worldwide to build uh a um uh let's just call it awareness of our platform as we continue to grow. And this is gonna be one of the beacons, if you will, that some of our uh investors can look at. So if you don't want to talk a little bit about this, this is impressive. This is the reason I like it so much is because of all the retail, and you have larger, you know, tenants that have consistent cash flow, and that's what institutions want, and that's what banks want, a family, they want to see less risk. How can you use big institutional practices, break down the risk, because they're writing big checks?
SPEAKER_00:This is cool. And this is again in Galveston, and I want to give a shout out, I guess, to the owner who's probably on with me. Uh Mohammed Eldoui, if you're there. Uh, thank you for being here. I'm gonna spend a little time on this one. 15 acres and 1.4 million square feet of future space in five separate buildings.
SPEAKER_02:And by the way, this is across from Tierra.
SPEAKER_00:This is across from Tierra and Diamond Beach. So this is all in the same vicinity. This happens to be on the north side of Seawall Boulevard, so it's not subject to some of the storm and flood conditions as the others. So there's less risk here and therefore less approvals that I have to go through. I don't I don't need the I don't need the Texas General Land Office or the beachfront folks on this one. So it's a little easier, but still not easy. We just had to get FAA clearance to go to 155 feet. We did that. Uh and it's a good thing because the the crane across the street where we're building tier is 220 feet. So I'm just happy that they they said, okay, 155 is what you can do. And I thought, cool. You know, they actually called me and said, How how tall is that crane? I said, 100 or 220 feet. They said, How long is it going to be there? About another year. They said, good, take it down in that year. You know, whatever whenever you're done, take it down.
SPEAKER_02:I don't want that there.
SPEAKER_00:So um the first three buildings in this are are right, they front on to uh Seawall Boulevard. Make sure you're gonna be able to do that. I think you've got the site plan. So you see uh in the lower right, uh the highlighted building is a condominium building, approximately 75 units, uh 11 stories uh next to that. The central tower, similarly, it's uh it's 11 stories. The the lower two stories in both of these condo buildings is retail. So you you're it's a mixed-use project. You have a combination of retail and residential in these two structures. Uh parking is below. The photo on the left, it's hard to see, but that's the ground level. So all of the parking is on the podium under the podium deck. There is some parking on on what you're seeing lower right up on the retail space, up on the retail deck so that retail people can get in and out and shop. The third building in the sequence here, uh on the left, the tower, is a hotel. And we are in negotiations right now with it for it, and we actually have the essence of a term sheets, a sh term sheet from Renaissance, uh Marriott Renaissance Hotel, and they want to own and operate the hotel, and they want to operate the condo goals.
SPEAKER_02:You know, a lot of people I don't think know this, but just like you know, they always say, How did McDonald's make so much money because they own the real estate? All these other fast food restaurants are typically land leases. Uh, same thing with a lot of hotels. They you somebody else actually owns the building, but they just in essence lease it and operate.
SPEAKER_00:That's right. So uh it from our standpoint, architects, you know, this is in design. It's right now in a PUD, a planned unit development application to the city of Galveston. A couple of variances. We have to get a variance on the height to get to the FAA limit. We have to get a few variances on density. But uh we're looking forward to our first hearing on this next Tuesday at the City of Galveston Planning and Zoning to talk about the second phase. The uh the second phase is the apartment buildings in the back, and that's the second phase, could be could be ten years from now. So um here are some hand renderings, just some conceptual sketches to give you a flavor for what the parking deck, the upper retail deck would look like in the upper slide. Uh in the middle slide, you see the three towers and the five-story residential structures in the back. That's where the J1 visas would be, maybe 25%. That's where the workforce housing would be, maybe 25%. But that's in a second phase that comes later.
SPEAKER_02:Perfect. Anything else you'd like to add?
SPEAKER_00:Anything else I would like to add? Um this is moving fast. Yeah, it is. And we're enjoying uh enjoying the association with uh Paradigm. And I know that Mohammed, if you're listening, I know he's enjoying the uh the fact that we've taken his project and showcased it. Absolutely. It's a beautiful project. Thank you.
SPEAKER_02:So, okay, guys, so we'll sum it up here, but I also want to leave a couple of nuggets for you. Um to kind of sum up with what we are planning on with Paradigm. We are gonna go ahead and expand and repurpose our secured income fund a little bit more. Um, we are seeing, you know, there, I don't know if you saw some of the stuff I just posted, but JP Morgan, we'll see, uh, is hoping that Rachel come down in September. We, I think we all believe Rach are gonna start coming down. I'm having a lot of back office conversations with investors, operators, and a lot of actually uh debt providers that want to provide construction uh financing for a lot of uh projects. So I think what you're gonna see is an uptick in activity again in development and cost of capital is going down. Therefore, investors are gonna feel more comfortable that the market's on the right track and you're gonna start seeing uh a flood into the market. You have annuities coming due, you have four IRAs, you got RMDs. I'm talking to all these people all the time about what's happening. So I think you're gonna see an uptick in activity. We wanted as a firm to power through this, not only if it was pandemic driven or rate hike driven in the middle of 2022, we saw a big um kind of pullback on that. And for those of you that know, on my uh$100 million fund, we actually fund loans and sell notes. It's a very institutional uh uh operation. We do, you know, uh audited financials, we sell the notes to other institutions, so we underwrite uh to a specific niche. And then um, you know, we want to be able to expand the Barncage product and the Paradigm Storage product. What we believe we've figured out is the product that we know and what we want to stay in, right? Where in the pandemic, so many people were more diversified. As Paradigm as a firm, we're going to continue to operate as a lender, hence why having some of these other projects on our platform, we can also assist in uh you know sourcing debt and equity, but also be that liaison for our equity investors or family office as being a reporting agency, if you will, or fiduciary to provide accurate reporting to investors about their investments and to some of these deals. So you're gonna start seeing us kind of come into this, morphing into a firm that's also looking at other operators that want capital and put them on them on our platform to also uh have our investors and new investors see it. So, other than that, I really appreciate everybody being here. This is a great audience. A lot of uh, you know, same same guys, a lot of my uh current clients. Love you all. I've had a lot of conversations with you guys over the years. I really do appreciate the support. If you need anything, feel free to reach out to me, uh, emails, text messages, call the office, we'll send up a call. And then, Steven, why don't you tell the audience how to get a hold of you and your team, please?
SPEAKER_00:So absolutely thank you. For first, thank you for inviting me. I mean, this is a great opportunity. It's a great partnership. It is. We're having fun. Yeah, and we're doing things that nobody else is doing. So I'm very happy with the partnership. Thanks for inviting me out here to like Havasu City to be on this. Place Designers is uh is headquarters in Round Rock, headquartered in Round Rock, Texas, with our satellite office in uh Houston. You can reach us uh there. I can we'll provide the data later, but uh we're we're based in Texas and and uh Paradigm's based out here, but it's still a great partnership. Oh yeah. We're everywhere.
SPEAKER_02:So, all right, guys, thank you all very much. Have a wonderful week. Again, we'll uh you'll probably be hearing from my team, so get ready for those phone calls. But uh, I really do appreciate everybody. Thanks for the support over the all the years, and we're hoping to continue to bring value. Cheers.
