The Wealth-Building Strategy Most Doctors Miss

In this episode of Paging Financial Freedom, Dr. Daniel Shin, surgeon and real estate investor, and Lila Kaplan, former Wall Street professional and certified financial planner, sit down with Teddy Mollman, Founder and CEO of Higher Ground Investment Group, to discuss his journey from private chef to multifamily real estate entrepreneur, the transition from transactional income to long-term wealth creation, and what investors need to know about real estate syndications in today's market.

Teddy shares his unconventional career path, from attending culinary school and serving high-net-worth clients in Miami to becoming a successful real estate agent and eventually building a multifamily portfolio of more than 700 units. He discusses how exposure to wealthy individuals sparked his interest in real estate, why he chose to step away from a lucrative commission-based business, and how he navigated the challenges of raising investor capital and scaling a real estate investment firm.

The conversation explores the mindset required to leave the security of a steady paycheck, the importance of mentorship, the realities of multifamily investing in the current economic environment, and why physicians and other high-income professionals should consider real estate as part of a broader wealth-building strategy. Daniel, Lila, and Teddy also discuss market selection, due diligence, tax benefits, and how investors can evaluate syndication opportunities with greater confidence.

Key Takeaways:

03:06 – Teddy shares his early career journey, from culinary school in Hawaii to running a private chef business in Miami.

07:10 – His transition into residential real estate, becoming Rookie of the Year, and investing commissions into income-producing assets.

14:29 – Why mentorship, education, and taking calculated risks were critical to scaling his business.

21:21 – An overview of Higher Ground Investment Group and how the firm grew to approximately 700 units.

25:27 – Practical due diligence strategies passive investors can use before investing in a syndication.

27:50 – The importance of market selection, landlord-friendly regulations, and understanding local economic conditions.

30:59 – Advice for physicians looking to transition from earning active income to building passive wealth through real estate.

34:35 – The role of tax strategy, cost segregation, and working with the right CPA to maximize real estate benefits.

Daniel, Lila, and Teddy emphasize that building wealth requires more than simply earning a high income. They discuss the importance of putting capital to work, surrounding yourself with knowledgeable advisors, and investing with experienced operators who prioritize investor success. The episode highlights how real estate can serve as a powerful tool for generating passive income, reducing taxes, and creating financial freedom beyond a traditional career.

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Connect with Teddy Mohlman!

• Connect with  Teddy Mohlman on LinkedIn
• Follow Teddy on Instagram
• Teddy's email: teddymo@kw.com
• Learn more about Higher Ground Investment Group

Links from the Episode:
🔗 Paging Financial Freedom Podcast on Apple Podcast
🔗 Paging Financial Freedom Podcast on Spotify
🔗 Dr. Daniel Shin’s Real Estate Fund
🔗 Lila Kaplan’s Real Estate Investment Firm
🔗 Teddy Mohlman, Founder and CEO of Higher Ground Investment Group


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💬 Stay Connected with Us:
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Transcript

SPEAKER_01 0:01

Welcome to Paging Financial Freedom, a podcast about doctors and spouses and the journey to financial freedom through real estate and tax activities. I'm Dr. Daniel Chent, a surgeon and real estate investor. You might know me on social media as Dr. Doctor or the founder of Surge Real Estate.

SPEAKER_00 0:17

And I'm Lila Kaplan, former Wall Street professional, certified financial planner, and the person on a mission to retire my author to be a service husband in the next five years. I specialize in apartment investing, helping doctors and their families build true financial freedom beyond their W-2 income.

SPEAKER_01 0:35

If you're interested in achieving tax-efficient financial freedom through real estate, you're in the right place.

SPEAKER_00 0:41

Let's get started.

SPEAKER_01 0:44

Welcome everyone to the Paging Financial Freedom Podcast. As always, I'm Daniel Shin, the Nora Name Doctor, and here with my co-host as always, Lila Kaplan. Lila, how's it going?

SPEAKER_00 0:55

Hi, Daniel. Great to see you again. I'm doing great. I'm especially excited about today's guest because his story has some real parallels to the conversation that we've been having on this show. The tension between security of a steady paycheck and also the pull of two or something even bigger.

SPEAKER_01 1:15

Absolutely. Because today we've got Teddy Molman. He's the founder and CEO of Higher Ground Investment Group, a Denver-based multifamily real estate firm. And, you know, today we're going to really get into the story here because it's a really compelling story. He didn't start in real estate. Teddy went to culinary school, worked as a private chef in Miami, pivoted into corporate sales as an accounting exec at a food distribution company, and then walked away from it all. Now he is, you know, he built a real estate portfolio that spans hundreds of units across multiple markets. He's a pilot, as we know. Teddy, welcome to the show. Awesome. I appreciate it.

SPEAKER_02 1:54

Daniel Lila, thanks for having me.

SPEAKER_00 1:56

Yeah. And I would also say that Teddy has been very instrumental in me getting into the multifamily space. And I would say that he's probably my first mentor in the multifamily space.

SPEAKER_02 2:08

So well, I appreciate that. Yeah. I'm very fortunate to have a lot of people help me to get where I am today, and I'm always happy to repay the favor.

SPEAKER_01 2:15

Full disclosure, Lila and I uh did invest into uh a deal with Teddy uh in Des Moines that is currently underway. So, you know, with that backdrop, I'd love to go back to the beginning, Teddy. So, you know, your origin story is you know so interesting. Tell us a little bit about you know where did Teddy grow up? Where did uh you get your start, and then where around the country did you get up to?

SPEAKER_02 2:38

Yeah, so I've definitely uh bounced around a lot um in my younger days. Uh born and raised in Miami, Florida. Um, when I was maybe about 16 or so, uh, shipped off to boarding school just to kind of see what that was all about, maybe also partially because I was a little bit of a naughty boy when I was growing up. Came back to Miami after that, finished high school there. And then when I was kind of looking for college experiences, I wanted to ship out and do something new. So bounced around from California, up and down the coast there for a little bit. Love, loved the West Coast. Uh just ultimately was a big surfer and hated the cold water. So had a one-way, uh, one-way flight to um to Hawaii and was supposed to be there for a short bit and stayed for about four and a half years. So with that Hawaii experience, that's where I kind of jumped into the culinary experience that you that you had brought up, uh, Daniel, and uh loved uh loved food and beverage, loved always being kind of the life of the party and thought that I can kind of make that into a career. So with that, you know, I did my culinary background in in Hawaii for a couple years and eventually uh landed back in Miami as I thought it'd be a good place for me to start a private chef business, which uh I did there from about 2014 to about 2017.

SPEAKER_00 3:47

So, what are some of your favorite things to cook?

SPEAKER_02 3:50

Uh being close to the coast at the time, a lot of raw fish was implemented into our menus. I mean, granted, depending on the clientele, uh we did a lot of uh, you know, a lot of high net worth individual. We do a lot of dinners there. Um so it would be really kind of curated to what their likes and needs were, but a lot of fresh fish for sure.

SPEAKER_00 4:08

Nice. I love it. I love seafood.

SPEAKER_02 4:11

Yeah, no, so we we had a good time and it was fun. I loved it, but uh, we'll probably get to this, you know, sooner or I guess in a bit here in the podcast. But I was just able to really get my eyes on, again, a lot of high net worth individuals, and whenever I was able to connect with them, uh there was a common trend and they were all uh relatively connected to real estate. So that's what sparked uh my next venture.

SPEAKER_01 4:34

That's so interesting. So, you know, in Miami when you were interacting with them, yeah, how did you get into those conversations where you were even sort of privy to what they were, you know, how they were making their money?

SPEAKER_02 4:44

Yeah, I mean, you know, granted, a lot of the the events that I would do would be in their homes, right? So I would come there to prep, you know, let's say the dinner was at at eight. Miami usually eats pretty late, so I'd get there around, you know, three or four and and start prepping, and I'd be pretty much, you know, in their home. So uh it was pretty common for me to connect with the clientele. And uh, I mean, some of these houses that we work at, there'd be multimillion dollar yachts, you know, on their dock on the water. And, you know, I'm I'm I'm pretty I'm a I'm a people person, so always was able to kind of get some information out of them and always sparked a conversation with them, and and they're they were always super nice. And ultimately was able to kind of get some information and just kind of see where they started, hear some of their backstory. And granted, there's a couple different, you know, avenues in terms of their industries, but there were a lot of synergies and a lot of them came from real estate. They were either passively invested in real estate or they themselves were actively uh had a family office that heavily was invested in real estate. So there was a common trend uh across multiple high net worth individuals that I worked with. So that kind of planted a seed in my head to explore this further to potentially have my own private, you know, chef working in my house and maybe a multi-million dollar yacht uh on my dock.

SPEAKER_00 5:54

So how how did that transition happen? You know, you're partying with, you know, millionaires, billionaires, you're having fun, and now you're getting into the grind, buying multifamilies. I'm sure you didn't start in multifamilies, so maybe you can tell us a little bit about it.

SPEAKER_02 6:12

Yeah. So I mean, it wasn't obviously an overnight thing. Um, it was something that I've always thought about ever since, you know, again, being exposed to this type of clientele. There is some real estate background within my, you know, my family. Um my my grandfather actually had uh his own successful business in Central and South America in the shoe business, but he did funnel a lot of that cash flow into real estate. So he bought real estate over time. Obviously, that kind of trickled down to my mom. She also, as she had her own successful business herself, she also kind of followed the same path and uh invested into real estate too. Um now she's retired, living a great life. Um she still works here and there on her nonprofit. But you know, if you look back to like what truly gave her the financial freedom, it was ultimately the her hard work that funneled into the real estate. So there was always all of these multiple angles, I guess, uh of nuggets that were coming through and giving me kind of these little, you know, I guess paths of where success would look like. So uh that kind of funneled me into exploring that more just real estate as a whole. So I started my kind of real estate career, let's just call it, in just traditional buy sale residential. So I got my license through Keller Williams. I was rookie of the year, um, did really well with just the you know, just the traditional buy sell uh transaction side of things. And looking down the barrel for let's call it my second year, I mean, we were on track to making $300,000 in in GCI. So that that seems good on paper, but I think what you do with those funds is probably the most important next step, right? And given all of these, you know, thoughts going through my head of how to kind of paint this path for my future, instead of kind of stepping up into the rat race, let's call it, and buying the nicer car or buying the nicer house, I would funnel a lot of those of those funds into real estate deals of my own. Started with, you know, short-term rentals, long-term rentals, and fix and flips, and then you know, saw kind of where that path was leading me to. And that eventually kind of got me into the multifamily space. So I'll kind of stop there and see if maybe if you guys have any questions on that at all.

SPEAKER_00 8:16

I I think this really resonates so much with what we hear from from physicians. You know, you can definitely work harder. Being an agent is not easy. You're constantly grinding. You might be rookie of the year one year, and next year you're not getting any deals. And so at some point you hit a ceiling, and whether that's more financial or physical or emotional exhaustion, just like the doctors. You talked about a little bit about where to put that money. So, how did that transition go from being an agent to actually putting some of that money into a fiscal asset?

SPEAKER_02 8:51

Yeah, it's a great question. I mean, if you if you look at the you know truth behind the curtains, it's it's it's a very transactional industry, right? You know, being a a real estate broker, right? So, you know, you can make, like to your point, you can have a really great year and make a ton of money. And then obviously the the tax man comes at the end of the year since we're you know paid out differently, and and if you don't set yourself up for success there, you know, that's a problem. But you know, being such a high transactional, you know, industry, you know, it's it's almost like how do you plan for the bad year, or how do you plan for where are you gonna park this money? Because I mean, we saw it in the boom of 20 to 2022. I mean, I saw people in my office with not one but two cars, you know, they had the nice car now versus the you know the the previous car they were driving the year prior. And it and it's just comical to look at that. And I've actually been able to kind of like have some some let's call it coaching classes with the Keller Williams office of like, you know, how do you actually have this path to you know to wealth, right? And I think a real estate uh broker can do very well even as they're in their first year, but again, it's how do you kind of maintain that wealth and and and make sure that you can grow it by making smart decisions and not getting stuck into the rat race. So to kind of kind of answer your question a little bit more, it's it's I was looking at that as as an option, and I again wasn't really as savvy as obviously as I am today. So I looked at mentorship programs. Um, I looked at, you know, uh individuals like yourself, you know, Daniel and Lyla of having their own firms or funds to be able to park the money to at least leverage their experience, right? Because I was still running a full-time job as a broker, and I have a couple different businesses on the side. So for me, it was saying, you know, hey, if I'm gonna be doing this, I'm gonna go all in. What is that next step? Right. So starting into kind of like the fix and flip model. So I did some single family flips in the Denver area. Those were pretty successful. Um, had some people kind of reach out looking to, you know, jump into the next deal with me since I was advertising, you know, some of our success stories. Um, that kind of triggered into like the next, I guess, step up in in the career was hey, there's clearly a path here of of growth, um, not just within the money that I'm putting in, but potentially with other people's capital. So started kind of a smaller friends and family round with some smaller fix and flips um that went where that went pretty well. And um saw again the path of this transactional you know, industry, which was again the the fix and flip model where you can do extremely well, but once you stop flipping, you know, you turn off the hose, right? So although in theory it made sense, it kind of got me back into the same cycle. So then I started to look at even a broader horizon, was like, okay, what is really this next tier of you know, let's call it financial freedom in a sense, but uh obviously it's gonna be not today. And that started to trigger into more of the multifamily um investing, right? So started to kind of look at the model of what we had in the fix and clip world with you know raising capital and said, okay, well, I can maybe do this on a smaller multifamily. So started in the smaller multifamily world. Um, you know, I was looking at 10 to 20 units at the time, did some acquisitions there that did very well. And uh over some blood, sweat, and tears, obviously those those were good lessons learned. You know, I realized that I can do a 10-unit multifamily by a hundred unit, almost the same amount of work in terms of underwriting and due diligence. You just need more capital, right? Maybe some some some some people on your team. So that's eventually how we started to get into some of the larger multifamily assets.

SPEAKER_01 12:20

That's a really interesting transition. And I think for physicians especially, it that actually is a really important kind of mindset shift because you went from this kind of model where it's essentially eat what you kill and it was very transactional. It was very sort of like deal-based, you know, in terms of getting a profit, to the multifamily world where you invest your money, and then even if you're, you know, obviously it takes some maintenance to grow it, but you're not having to work every single day to allow that sort of deal to progress and grow. You know, it's it's almost like it is growing for you in a way, once you kind of set up the parameters. So uh making that transition, can you walk us through when was there a light bulb moment when it was clear that you had to sort of get away from the transactional to that multifamily?

SPEAKER_02 13:09

I mean, again, just looking at the transactional moment was great, boom, we got this big pop of capital after a successful, you know, let's call it a successful project or deal, whatever we were working on. And and now what? Right? Now we have to hunt for the next one. Or if we had one all you know in parallel also moving, it was kind of this like rinse and repeat model, which in theory makes sense, right? I mean, again, you can make you know a tremendous amount of money doing that, but you're now looking at the barrel of short-term capital gains, depending on if it's a you know, a quicker flip or a longer flip, right? So then I'm starting to look at also tax strategies in addition to what I'm currently kind of to your point, like what's that light bulb moment? Well, what can we do to continue maybe A, making this less transactional and more wealth building? And then B, how do I do this with like the the most significant amount of tax savings um compared to like a short-term capital gain? So then that's when the kind of the light bulbs started trickling in. In our world, we're so you know, we should be so grateful that we have podcasts like yours and podcasts like other people's in the real estate world. And I mean, now with AI, I mean, the the amount of of knowledge you can get within seconds is is absolutely fascinating. So with that, I really just kind of took some podcasts and books and you know, went down a rabbit hole and realized that, you know, with with bonus appreciation and some of this long-term generational, you know, wealth with with multifamily was kind of like that next thing. So I wouldn't say it was like a specific light bulb moment per se, Daniel. I just think it was a combination of things that's like really, I guess it was like this level up that I kept seeing and I kept hitting the top of this level, which again, I could have grown to a pretty successful fix and flip business in a sense, where we could be doing five to ten transactions a month, which a lot of people do do. But for me, it was again like how do I make this into more of a longer-term wealth where, hey, one day if I want to go take a week off and have the team run the ship for a bit, I'm able to do that. And I feel like with the fix and flip model, at least in my experience, it'd be harder to do that than a multifamily.

SPEAKER_01 15:03

But how did you get over that sort of fear factor where, you know, you're you're making a really significant shift from fix and flip to multifamily investments? And, you know, even taking investor capital, you know, these are friends and family, and you're you're taking their hard-earned money and you know, putting it into investments. How did you get the confidence to do that? And what were those early days like when you were kind of starting that process?

SPEAKER_02 15:28

Yeah, it's a great question. I mean, I'd say two main points. Number one, work with a group that has success, right? I mean, look like chatting with you two. I know a lot of your investors are physicians and and people that don't have the time or are really experienced to do, you know, to invest in or I guess to be actively investing in real estate, mate, they might be better off passively investing. So working with a group like yours would be number one. And then B, if you are gonna be doing it on your own, have a great mentor. You know, there's a lot of programs out there that you can, you know, pay for or be part of. So I would say if for me, it was definitely scary, but I think if you stay scared, you're never gonna grow, right? I mean, I like to push the limits a little bit more. And I'm I'm a big believer of you have to, you know, you have to build a plane while you're already flying, right? That's one of my favorite quotes. You know, if you're always waiting for that perfect time, you're gonna be sitting on the sidelines forever. So for me, it was something that I kind of took my own capital and learned a lot along the way. Fortunate to say that we didn't really lose anything at the time. We learned a lot, but you know, that next tier uh or I guess that next level up, I mean, we just had to take the plunge, right? So for me, it was make sure that you have good people around you, right? Good mentors, uh, had a good team to kind of support me on that next um, let's call it level up. And uh, I'm an all-in guy. I mean, if I'm gonna be doing something, I'm gonna be doing something all in. So, I mean, I I at the time I really took a step away from my residential real estate business, which was producing a ton of money for me. But for me, it was take a haircut. I mean, take a huge haircut now on my active income, but maybe look at what it's gonna look like in five or 10 years. That was my no that was my my goal. And seeing what the path of multifamily could do for me, I was ready to take that risk. And um, and for those who want to invest with me, I think they they saw that I was, you know, committed to get it done right.

SPEAKER_00 17:17

And and Teddy, you know, you said a lot of very interesting things, especially taking on capital and managing other people's money. When you first took that first dollar from your family or friends or anybody, right? Your super wealthy friends, what did that feel like? And what did that teach you? Did you have the like how did you even have that first conversation with these multi-million, million billionaires?

SPEAKER_02 17:46

Yeah. Um I mean, it's always a little nerve-wracking taking anyone's capital. I mean, it's it's I mean, even to today, I mean, every decision that we make within the firm, Javi and I, my business partner who I know you guys spoke with, like we're always gonna look at each other and say, what is the best decision here for the investor, right? I mean, there might be something that's better for the business plan, you know, and there could be something that's better for the investor, right? So we're very, very investor first there. Um, but to kind of answer your question, I mean, it it's always nerve-wracking because some people, I mean, even if you have a smaller deal, we're doing a $50,000 minimum, you know, uh, or even a $25,000 minimum. I mean, for for some that that might be nothing, but for some that might be everything they have to to invest, right? So it's that it's definitely nerve-wracking there, but I personally invest in every single deal that we that we buy. And um, you know, the the firm that's that's something that we've always done since day one. So I would never take someone's money if I'm obviously not gonna invest in it myself. So I think for me, that's number one is it's not it's it's obviously nerve-wracking, but I'm not too concerned because again, it's it's you know, there's always a saying that like you know, you if your grandmother would invest in this deal, would you go for it? Right. You know, so that's the mindset that I have is if if I'm not gonna invest in this deal, why would I ask for money? So for me, it was always my my path was always to have a successful transaction because I'm gonna be alongside our investors with capital.

SPEAKER_01 19:10

That transition that you had where you started kind of pulling back from the sure thing of the transactional real estate broker deals to, you know, really betting on yourself and building this company and uh, you know, higher ground investment group, it really resonates a few years ago when I was kind of putting together serious real estate. I had to give up a full-time doctor job uh and you know, went part-time and locum tenons. And that I think was a tremendous, I mean, I was so tortured about it. So I can imagine, you know, how you must have felt when you were making that transition. That that that's huge. But I I think carving out that time for yourself to really commit it to a company, uh, I think that's unfortunately necessary. And that is where I think a lot of times the the medical community fails, doctors and you know, other medical professionals, where they don't they don't give you that freedom. I mean, you can't just go to your hospital employer and say, you know, I'm I'm thinking about starting this company, I'd like to just cut my hours back about 50 or 60 percent. You're cool with that, you know. Pretty much it's gonna be, you know what the answer is gonna be. So uh, you know, the freedom that you had in making that decision, um, that's amazing.

SPEAKER_02 20:16

Yeah. And and I tip my hat to you too, Daniel. I mean, it's it's it it's it's it's a scary thing, right? And I mean, I don't have kids, so it's a little bit different for me. I can risk it all if I want to, but you have a family and kids, so it's you know, it's even a a a bigger concern. So um, but you know, with with those people surrounding you, if they can, you know, agree and and they're happy and obviously they're they're alongside you, which your family was. I mean, that's a that's a big success story in my eyes. But it it's always definitely uh uh you know, it's always concerning to to take, I guess, what you're looking down the barrel of this consistent payout every single month, and now you're gonna take this big plunge. And it's the the way I see it is if if it failed, which I don't really ever want anything to fail, there's always something you can go back to. But I'd rather be in regret that I don't want to be in a regret that I didn't try, I guess. So for me, I'm an all-in-kind of guy.

SPEAKER_01 21:05

Yeah, I think the the blessing that I had was the support of my spouse, honestly. Um, you know, both both financial because she works full-time. She's amazing, she's a museum director, and also kind of conceptually, she was on board with the you know, risk taking that I was kind of proposing. So that was pretty amazing. Um, before we move on, do you mind just bringing up to speed? Like, where is Higher Ground Investment Group today? It's like how many units do you guys manage and what what's on the horizon for the company right now?

SPEAKER_02 21:34

Yeah, we're um we're plus or minus about 700 units total. Um I'd be a little bit off of what Hobby said because there's a a couple properties that we bought before Hobby kind of joined, but about 700 units total. Um, majority of those, about 550 of those, are in Des Moines, Iowa. We're closing another 135 units in the next, hopefully the next 30 ish days. Just got some delays there. But that's kind of where the the firm is now, and we're gonna continue to be buying in New. Midwest markets or sister like markets because for us it's been our our best producing market and we do love the yield and we love kind of more of those steady eddy boring markets. So for us, that's gonna be our our main focus here for the next five years.

SPEAKER_00 22:13

All right. So Teddy, I'm gonna just shift gears a little bit because I think this is where our listeners really need to hear from you. So recently on social media, I got, you know, I I'm basically on the algo for these multifamily deals. And everywhere I look, it's 20 IRR, 30 IR, 40 IRR. Um, and everything looks incredible. But we know that real estate syndication have been through uh a huge storm recently and it's starting to stabilize. So maybe you can give us the real deal, the unfiltered picture of what it actually looks like to get into a real estate syndication right now.

SPEAKER_02 22:57

Yeah, I mean it's it's it's interesting you say that. I mean, I think there is like a bad stigma, at least over the last couple of years, with syndications, right? I mean, I think a lot of people rode this really insane wave from, you know, it's called the 2020 years, and uh they all banked on these six to ten percent rent appreciation, you know, rent growth year over year for the next five years. And it's fascinating, not only how people A invested in those deals, but B also how banks loaned on those deals. You know, I mean it's you can look back at any at all historical data points, and there was never really something that can really sustain that growth year over year. And that's a compounding mistake. If you miss three points year one, you got to catch up on your two, and it's a compounding mistake, right? So to kind of answer your question, I think what we're seeing now, again, there there is a bad stigma to what syndication is, but I think the operators that bought well, uh, operators that bought with fixed debt, those guys are doing okay. Um, I don't think anyone knew what the interest rates are going to be doing, even the ones that have been doing this for 30 years. So that's that's really, you know, it's a shame for a lot of those individuals and and even the ones that bought very expensive rate caps, they still exceeded those. But what we're seeing now is, you know, the the Sunbelt markets are taking a hit. Um, some operators, if they get out of good buy, they're still able to take these discounted assets and do pretty well. Um, I think those Sunbelt markets are seeing a decent peel back on rent growth, which if you're good at what you do in that market, you're probably doing a negative, you know, negative rent growth year over year, depending on on the submarket, right? This is sneaking macro level. But I'd say good operators that are still around and doing well. I mean, they're they're still transacting. I think there's a lot of people that are in trouble right now, and we're seeing a lot of lender relief that's starting to, you know, I guess they're they're starting to run out of that relief in in a sense, and they're kicking the can down the road for too long. But we have been seeing a lot of creativity with lenders to try to make sure they don't take back the asset. At the end of the day, they are in the business to loan money, not manage a property. I think they are now coming to, you know, seeing, I guess, the truth behind the scenes of what operator actually has a chance versus doesn't. And they're giving those with a chance some more time, and they're looking at the ones that just really just didn't do a good job or nor they will. They're just they're just foreclosing on those assets, which gives us more of an opportunity on the buy side. But for any, you know, individual, again, within your your investors that are that are looking to invest in syndications, I I wouldn't just shoe away from them completely. I still think there's a lot of really good opportunities over there. It's just taking the time, you know, with your due diligence, speaking with, you know, like Lila and Daniel, taking the time to speak with you guys and and make sure you guys know what you're talking about, know the numbers like the back of your hand, you're very confident in the business plan, not only about the deal itself, but who's managing the asset, right? That's very, very important. And and have their own due diligence. And you know, when I before I would put money in my LP deals, I'd call brokers around that market and say, hey, I'm investing this deal. Would love if I could take two minutes of your time. Do you think this asset is is going to be generating you know this much per per rent for a two-bedroom? Or do you think a 2% increase year over year is is good? If you call a good broker, they'll be able to tell you off the fly. You know, a good, good market knowledge uh broker should be able to tell you that. So taking the extra layer, I guess, and and not just trusting the team, but also trusting the numbers and and taking an extra an extra layer and extra step to make sure that everything within the deck looks right and make some calls. I mean, if you can do it in I mean, uh a phase one, you know, in my opinion, due diligence. If you're an LP, you can do it in in one day. Just call around and ask the right questions.

SPEAKER_01 26:43

That's great advice. And, you know, I I hesitate to say this because podcasts live forever, but I do think we're gonna look back on this sort of window of opportunity right now as one of the best windows over the next you know decade or so in terms of putting capital into multifamily and into housing just because of where we are in the market. Um, you do you agree?

SPEAKER_02 27:02

Yeah, I I agree. And again, it's you know, it depends on on a macro versus micro, you know, lens, right? But you know, there's a lot of units that were came online, I guess, from the COVID delays, right? And that's why we saw a lot of rent pullback from let's call it 23 to 25-ish, depending on the market. And then we also saw a lot of people that did not, you know, there were not a lot of permits issued because they were still trying to fill the units, right? So we're we're gonna see this little bit of a lag. So I I'd agree with you, at least in the markets that we're in, right? I think there's also, you know, there's also another layer of complexity, not just about deliverables of newer multifamily, but also some markets with tenant laws that are changing, right? I mean, we're we're heavily invested in in a red state, which is in Des Moines, Iowa. Our tenant laws there are actually in our favor. We're also invested in Colorado, and I know Lila's there, where you might be seeing there's a lot of blue tape that's been changing to the point where it's making it really unsustainable for landlords to kind of do what they need to do, which is just manage these properties. So um I think, you know, again, at a bird's eye view, I would agree with you, Daniel, but getting to the to the you know, the nooks and crannies, it's gonna be very dependent on on which market you're investing in.

SPEAKER_00 28:14

Yeah, that is so true. Cause I do invest in Dallas as well, which we love. And it's definitely a very landlord-friendly state. And I think we're able to get somebody out within 27 days. I think with the new Colorado regulations that came into place, it's 60 to 90 days because there's a lot of procedural things that you have to go through before you can actually kick somebody out.

SPEAKER_02 28:40

And that that's accurate as everything's exactly the day it should have been done. We have tenants that are have been delinquent for about 190 to 200 days, and we're, you know, we have a writ of removal, but the the sheriff is so behind that they can't even evict them in person yet. So I mean, it's taking some properties, you know, eight to ten months to get them removed.

SPEAKER_01 28:59

And how do you respond when someone says, that's great, because we don't want landlords to have the power to kick people out, you know, willy-nilly? Um, that is awesome for the everyday man. How do you respond to that from like a real estate investor standpoint?

SPEAKER_02 29:13

Yeah, I mean, there's that's where you kind of like back up the lines of like, you know, just trying to be a good person, right? I mean, there's no there's no day where I want to kick anyone out to the curb. There is never a day where I feel okay doing that. That being said, if you show up to a restaurant and you ask for a nice steak and mashed potatoes, you start to eat it and then you don't want to pay them, do you think that's fair? It's the same concept for us as landlords, right? I mean, at the end of the day, you you you are paying for a service, you're paying for a roof over your head. And I and I sympathize if you have some financial distress. However, at the end of the day, you know, we have a no pay, no-stay kind of like uh, you know, formality in some of our markets. And we're willing to work with them on some stipulations, right? If we take them to court, we'll say, hey, we'll give you, you know, you have to pay X amount in two weeks and then the full amount in four weeks. You know, we're happy to kind of work with them. But once you kind of know once a tenant or two and you're doing the runaround every single month, and at some point it's just maybe it's not a good fit. So um it's difficult to kind of answer that because again, like I, you know, I do have a heart and I do care about people that are going through some financial distress, but at the end of the day, I mean, you know, there it there are many creative ways to make money these in this world, and a lot of the people just take advantage of the system versus really being in financial distress.

SPEAKER_01 30:29

All right. Yeah, fair enough. So let's bring it home for our listeners. So a lot of our listeners, as you know, are physicians, they're tuning in and just trying to figure out how to make that transition like you did, um, basically from uh this model where it's essentially eat what you kill, you're an hourly worker, essentially. For most physicians now, you know, 70 plus percent of physicians are employed. And you need to start putting your capital to work. So, what is that sort of elementary piece of advice you would give to physicians who are thinking of starting to invest capital into real estate? You know, what's that first step that they should take?

SPEAKER_02 31:04

Yeah, I mean, definitely reach out to operators like yourself, kind of get a pulse in the market, see where they're investing, see where maybe other operators are investing. You know, at the end of the day, I think it's really important for people to wherever they invest in their money, they also want to believe in the story and and the deal itself, right? So if you don't really know the market very well and you're not confident in the market at all, why invest in there just because you like the operators, right? I think it's it's really important for you to trust and like the operators, but also really enjoy the market itself and do your own due diligence. But for those that are just getting started off, I mean, it it there's no surprise that real estate is is one of the top, you know, investment vehicles that are out there, right? I mean, if you want to be more of a steady Ed ESP 500 guy in index funds, by all means, that's great. But that's gonna be slower, slower wealth building, in my opinion, right? Um and you could diversify, you could look at some of those index funds for maybe a percentage of your portfolio, and then maybe a little bit more, you know, let's call it higher risk in some people's lens, but make way better returns on on um the real estate side of it and and obviously including the the tax benefits it has to offer. But I'd say for those that are looking to kind of get started, you know, start chatting with a couple operators, see who kind of fits your mold and who you kind of feel better to work with. Because at the end of the day, although you're a silent investor, you're technically married for with them for about five to seven years, depending on the the length of the deal, you know, and do your due diligence, right? You know, look at the numbers. If you have an accountant or you have a financial advisor, you know, leverage them, have them review the deck, have them review the underwriting, um, have them reach out to the operators. I mean, I have a lot of calls with some financial advisors when people are looking to park money in our deals, and that's totally fine. So I just think, you know, just taking the time to do the right due diligence, um, invest in multiple deals, don't just put all of your money in one, you know, all of your money in one deal. I think that's a really important thing too. And not just diversifying in multiple deals, but maybe diversifying in multiple more markets as well. And make sure, again, that the people that you're parking your money with are looking at you as an investor, but also kind of assisting you with this wealth building and they are doing what is needed in terms of the tax structure or you know, the entity structure to make sure that you are going to be maximizing your tax benefits and you're doing it ethically, of course, because a lot of people do kind of push the boundaries to juice their, you know, their losses. But at the end of the day, you know, the last thing anyone wants to do is get audited and then fail to audit. So just make sure everything is done correctly and by the book. And I think that if you choose the right operators and you choose the right deal over the long run, you will be, you will always win in real estate.

SPEAKER_00 33:38

Really great advice, Teddy. I would also add to that is finding the right team is so important. It's finding the right CPA, tax specialist, finding the right financial advisors that's willing to work with you versus just wanting to put, you know, your capital into stocks and bonds and mutual funds. Because that's definitely what I have seen going through the journey of my husband is financial, some financial advisors are not as broad in their knowledge of investment products. They don't understand real estate. And so as soon as somebody presents them a deal in real estate, you know, they'll they'll tell them don't invest, it's high risk, don't do it. When in fact, we, me and my husband, have used real estate to not only grow our wealth, but also to preserve our wealth, especially in terms of taxes. You know, we're able to successfully reduce our taxes for the last five years through the benefits of real estate and all the real estate uh regulations versus, you know, stocks and bonds. You don't really get that. You know, you can do tax harvesting, but you you need an actual loss to do tax harvesting versus in real estate. You don't need a loss on revenue to give you the depreciation back. So I think that's very, very interesting.

SPEAKER_02 35:04

Yeah, that's it's good that you you you brought that up. I mean, not just having an accountant, but having the right one that's gonna be savvy in the field, you know, it's it's shocking to me how many accountants that we've sent you know K1s to and they're telling us that these losses are not done ethically. You know what I mean? And it it's it's it's even more shocking that I've had to educate another CPA. You know, you're looking at a college dropout over here, but that's had to educate another CPA on on you know tax strategy with real estate, right? And and typically when that happens, you know, we don't obviously want to offend, but you know, our firm, we do have uh an accountant, you know, shout out to TrueBooks that that they do, you know, they have we pay them like an annual fee to have them kind of like a tax consultant for us. So if there's ever any discrepancies between their accountant and ours, we just kind of connect the dots and it's part of our kind of service, and they kind of educate them on how to do it correctly to make sure that everyone feels comfortable within the process.

SPEAKER_00 35:57

Yeah, and I've started to use Jerry as well after having a conversation with you, Teddy. So yeah, I'm I'm in year two with them because my previous CPA actually told me not to do COSEG, which I didn't listen to him. You know, I'm very stubborn and rebellious in that sense. And I I come from a financial world as well. I still have my CFP, so um certified financial planning degree. So, you know, I just I I just needed to find somebody new, and I knew that you were working with them already. So thank you so much for the introduction.

SPEAKER_02 36:32

Of course, of course. They're probably sleeping now. They've had it's April 17th, and we're recording this. So they they just had an incredible week. So yeah, I'm glad you connected with them, Lila.

SPEAKER_01 36:42

I think bottom line, you know, you don't have to do it alone. I think the thought of dipping your toe into real estate is so intimidating to so many people because it's not taught in school and no one knows about it until you actually go after the knowledge. But there's so many people out there who are willing to, you know, help you get into it. So amazing. So, Teddy, thank you so much for joining us today. You know, I think this has been a really great conversation that really encompassed the breadth of the decision-making process to kind of get into real estate and also some really good actionable advice. Uh, so how should people get in touch with you to learn more about your company if they would like to do so?

SPEAKER_02 37:20

Yeah, I mean, they can reach out through Instagram. I think it's teddymo.re um or just the uh highergroundig.com is the website. You know, again, always happy to be a resource. You know, like like Delilah started off. I mean, there's so many people that have helped me along my journey, and I'm always happy to repay the favor. So feel free to reach out anytime. Well, perfect. Well, thanks so much. Awesome. Thank you all for having me. I appreciate it.

SPEAKER_00 37:43

Thanks for tuning in to Paging Financial Freedom, where we help doctors and spouses like you take control of your finances, invest smarter, and build a life by design.

SPEAKER_01 37:54

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SPEAKER_00 38:02

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