Grant Warrington: It's like a lot of people and people always ask me, you know, oh, well, where should I start? I'm like, just anywhere you can. Right. The bigger, the better. But starting is starting.
Whitney Sewell: With your daily real estate syndication show, I'm your host, Whitney Sewell. Today our guest is Grant Warrington. This is segment two. I hope that you will go back and listen to yesterday's segment if you didn't hear it. We're going to dive into how he has found these apartment buildings and how he's doing that offline, how he's connecting with the sellers, even some seller financing techniques that he has been successful with. Welcome back to the show. Looking forward to diving right back in. And I hope the listeners will listen to yesterday's segment if you missed it, because, man, Grant brought a ton of value around how he has built social capital in a major way over the last couple of years and how it could be also very valuable to you. He just laid it out in a number of ways. I mean, if you implement just a few of the things that he talked about yesterday, you're going to be in such a different place I would bet in six months, much less a year to two years from now. So, Grant, thanks again. Welcome back to the show.
Grant Warrington: Thanks, man. Appreciate it.
Whitney Sewell: Yeah, honored to have you back. And I want to dive into, you know, some other expertise that you have. And today, and you know, obviously finding off market deals is a specialty of yours. And even just the construction piece, because you were in construction for so many years, that's definitely a very valuable skill set when you're in the apartment business, is the construction side. But, but let's back up a little bit. I know you helped many, you know, in this process as well. I know you have a course and are coaching numerous people successfully to make this happen. So I want the listeners to know that as well. But let's jump in. Where do people mostly start at? Maybe let's do that. When they're getting into this business, is it learning to find off-market deals? Is that the first step? If so, let's dive in there.
Grant Warrington: Yeah, for sure. And I wanna clear one thing up though. I was a crane operator. So I was a construction worker for 24 years. I was a crane operator though. So the problem is those skills don't transfer to rehabbing a house or anything like that, right? I ran a crane. Um, so I had a lot of fun by the way, which it, it was in the beginning and then it turned into a job. Right. But, uh, but, uh, so those skills did not transfer. I was not handy. Um, I became handy, but, um, I, I did not have that. I had no advantage getting into this when I started at all.
Whitney Sewell: I mean, that is good to know just so the listeners know that as well. I mean, look at you now, you know, and man, you just went out and made it happen. You became handy. Uh, like you said, all of that.
Grant Warrington: Yeah, and we started with single family rentals, just like a lot of people. And people always ask me, oh, well, where should I start? I'm like, just anywhere you can, right? The bigger, the better, but starting is starting is what I say. And when I teach people to buy, I don't wanna overwhelm people. So I say like five to 20 units just to get into that commercial spills, commercial loans. And I teach people off market apartments And I like to teach people the same way I learned too, right? I didn't have a lot of money to spend on all these different things. So what I tell people to do is just like, I have a free workshop too. It teaches you to just go to Google Maps and you can look from above for large roofs and parking lots in your target area. So that's what I did. I would search Google Maps and you'd be amazed at all of the properties you find there. You just jump down to street view, you make sure it's an apartment building, and then I'd put it down on my list. And then I would go through and create a list of like 50 buildings as I'm spreading out right through Google Maps in that area. It's like driving for dollars, but you don't have to leave your house. and you can do it from above. And it's incredible what you can accomplish like that. And then there's so many free tools to get to find the owner, find the owner's phone number. And then I call the owner of that building and I ask him, hey, you know, I tell him, I compliment him, right? Like, hey, I love your building. My wife and I drive by it, or we own property in the area. Have you ever thought about selling? And that's what I do. I also, I'll go to buildings. If I'm driving by and I see a building, I'll ask the people, hey, is there any vacancies? Can I get the landlord's phone number? And that's how I'll get the phone number for the landlord. I'll call that landlord. I'll go on zillowrealtor.com. I'll look for rents on there. And if it's a person's name, Gary, with a phone number and not property management, I'll call and I'll just say, hey, you know, love your building. You ever thought about selling? So there's so many different ways to find these off-market small apartment buildings. It's really crazy. And it's really an untapped market because you know, when you get started, people are teaching you to buy, how to buy single family rentals. And then, you know, there's a jump up to syndication, right? There's not a lot of people talking about small apartment buildings. Not that I know of. So that's kind of the space I'm in, because that's where we've made it. We have a 20, a 20 unit and an 11 unit, an eight unit and a duplex. So 41 units total. And the 20, and the 20 unit and the 11 unit we've bought off market. and the 20 unit we bought with seller financing as well. So we've been pretty successful in that area. And with it, the problem being a lot of the people that own those properties are mom and pop landlords, right? They're in their 60s, 70s or older. And they're pretty tired and their properties are tired and they don't manage them very well. They don't collect rent very well. So those are great targets to, um, to approach. And a lot of the people are just looking to, to get rid of them, to get out of them and just don't know how. So, um, that's a great place to start. And that's what, uh, that's why we love being in the space.
Whitney Sewell: Were all of those local to you?
Grant Warrington: Yeah, they were all in our backyard. Yeah, all of them.
Whitney Sewell: Wow. Well, that's incredible that you could do that.
Grant Warrington: Now we've moved, right? That was in Michigan. That was in Michigan, but now we live in Florida and we manage remotely. But yeah, it was incredible to be all in our backyard.
Whitney Sewell: Speak to self-managing and managing even remotely.
Grant Warrington: Yeah. So it's something we did in the beginning to save money. And looking back now, I'm like, well, if we got used to giving that income away, maybe we'd been better off. But it's something we're really good at. And the beautiful thing is my wife now manages all of our properties. We're a team. And that gives me time to work on the social media and, um, and my course, the apartment buying blueprint. Um, so luckily we have that. And, um, my wife hired a boots on the ground person, went on indeed and, uh, put in, put a, uh, resident, you know, put a application out, hired somebody locally to us, uh, in, in Michigan where our properties are. And that's worked fantastic. Um, and I always tell people invest where you know. So if you invest where you live or invest where your parents live, invest where you went to college, invest where your friends live, you vacation a lot, just invest where you have people. Because if you're gonna invest out of state, like I can call my dad and be like, hey man, run over there and check this out. We had a pipe burst and my dad was there in a minute, as the plumber was still getting on his way there. So invest where you have people is always the best advice that I give people.
Whitney Sewell: Do you plan to continue buying more local to where you live now or still up there? What's your plan going forward as far as acquisitions?
Grant Warrington: I guess we're trying to get away from Michigan because we don't live there anymore. And we want to get into a warmer climate. The other thing is, when you start off, I'm sure you know this, you start with lower class buildings, older buildings, right? It's just what you can get in. Not awesome neighborhoods, maybe, and you just kind of level yourself up. So we're looking to level up into B, B-plus properties. We probably have B-minus properties in B-plus neighborhoods, but they were Cs when we bought them. But they're 1960s Um, so they're older buildings and we kind of want to get out of that. We kind of want to get out of the snow, um, and get in better areas. Now, again, we're in Florida now. So now that comes with, uh, you know, hurricanes and all kinds of other different things. So, so we're not, we're not positive yet. It's Florida, but we know it's going to be in a Southern area. That's a very landlord friendly.
Whitney Sewell: Okay, so you've found the building, you've located it. I love all your tactics around calling the owner as well. Even, hey, just walk down the street and maybe you see a tenant and ask them, right? Yeah. You know, that could be so simple, but man, something that you don't think of or just go do, right? So call them, get them on the phone, make an appointment and potentially see if they want to sell. Actually, I want to back up even a little bit more. You mentioned you seller financed one of them. Talk about approaching that conversation a little bit. Obviously, that could be a great avenue for the seller and for buyer potentially. How did you know that was a good avenue for you? And if you can elaborate on any of the terms or some things that made it work for you, that'd be great. Great.
Grant Warrington: Yeah, first I'll tell you how we found it. We owned a single family rental. I was with the inspector in the basement. He was doing the rental inspection to get our certificate of occupancy. And I mentioned to him, hey, because I started telling everybody we're looking to buy apartments. Everybody I met, so I'm like, well, I gotta tell him. And I was embarrassed because we only owned a few rentals. And I'm gonna tell this inspector who to me was like God back then, right? I was like, oh my gosh, this guy can ruin my life. It doesn't have to be that way. But I said, hey, we're looking to buy rentals. You know, my voice cracking and everything because I was so nervous. We're looking to buy apartment buildings. You know anybody that owns one? And he said, yeah, I do. There's this woman named Blanche. She owns like 60 some rentals in the town I lived in. And he's like, you should give her a call. And I'm like, all right. So I Googled her number and found her. And I called her and she's like, who is this again? And I told her, looking at my apartment building. She sat there for a minute and didn't say anything. And then she goes, she's like 80. And she said, I'm not looking to sell anything, but here's four properties that they do a very bad job running. You should reach out to all four of those. The fourth property was that 20 unit building. And we ended up buying it. So if I hadn't told that inspector I, we never would have got that building. So, I mean, just the power of telling everybody's huge. So in that, that guy owned a liquor store right next to the 20 unit building. So I went into the liquor store and I said, Hey, I hear you on the building next door. are you looking to sell? And he goes, yeah, I'd be interested in selling. And I was like, oh, now what? I'm like, okay, how much? And then we started, we just negotiated right there in the liquor store. I'm not a shrewd negotiator. He's just like, well, I'd have to get, I think we decided on 625,000 for the 20 unit. And I said, great, we'd like to give you like 5% down or something. He's like, absolutely not. I need 20%. I have to pay off. He had to pay off the water bill. He had, he was way behind on taxes, all these things. He's like, I just, I cannot, I need 120,000. And I said, well, would you be willing to do seller financing? And he's like, Yeah, we'd be willing to do that. And again, I was like, oh wow, now what? And I said, well, I'll tell you what, let me go home, let me run some numbers and let me get back to you. And then we just, the beautiful thing people, a lot of people don't realize is it's just you and the seller coming up with these terms. There's no seller financing God that decides you can't do this and you can't do that. It's just you two agreeing to it and putting it in writing. And that's what we did. And I said, how about, I need a 30-year amortization because I need to keep the payment low. And he said, yeah, I don't care. I said, I need a five-year balloon payment. And he said, no, my dad's older. We don't want to wait that long. So I said, well, give me 28 months. I'll refinance in two years, but give me a few extra months just in case. He said, that's fine. And I asked for a 5% interest rate, which was higher than normal back then. Now it looks great. And he said, yeah. So that's what we did. We put 20% down and 16 months later, we refinanced that property. We bought it for $625,000. It appraised for $1,030,000. And we got a check back for $300,000 tax-free. And that was amazing. All our money was out of the deal and we were able to go buy our next 11-unit property. We found that one off-market too.
Whitney Sewell: Congratulations. Uh, I appreciate just the, just the simplicity, right. Uh, I just going in and talking to the guy and figuring it, you ultimately figured out what he needed. Right. Yeah. And made that happen. Made it work for him.
Grant Warrington: A hundred percent. And I, I tell people like, man, if I can do this stuff, you know, you guys can too. It's just, I'm just open and honest. Like, yeah, what do you need? Let's. And if I can make it work, I'll do it. Um, you know, I, I, I'm not, uh, I'm not a master negotiator. I'm not all these things, man. I'm just a guy that's like, hey man, I just got a dream. I didn't want to work for anybody else. And that dream burned hard enough that I'm like, I'll figure this out, dude.
Whitney Sewell: Love that. OK, so now you own the building. What's some big surprises or things that come up that you wish you'd known then that you know now?
Grant Warrington: People aren't easy to deal with. That was the big surprise. When you buy a building, the average rents were 480. Now, I think they're 900. But when you buy a building and the average rents are 480, we were thinking they should have been like 650 or 700. The people that are paying 480 shouldn't be living there, right? Because the rent should be higher. They shouldn't be living in that city. more than likely, right? Because they can only afford to live there because it's 480. Let's put it that way. They can't afford to live there when it's 700. So the problem is, when everyone looks at a property, they always say, I'm going to increase rents. And they never take into account, how are you going to do that? And it's going to take you time to do it, right? These people need to be on 30-day or I'm sorry, month-to-month leases. You can't just go in and increase people's rent when they're on a year lease. So you have to take that into account. And the people are gonna be unhappy about it. So we couldn't afford everyone to move out. And so what we did was we just bumped people gradually over time because we did not want them to move out. We had five vacancies. He told us there was three, I believe, and it ended up being five. So we rehab those, we bump those up to market. And now here's the problem, excuse me. We're bringing in a better tenant base, right? They're qualified, we're screening them. They're nurses, there's these people that go to work. The other people in the building didn't do that as much. And so now you have your good tenant base with your other tenant base and we made the building no smoking. So we have five people now in there that aren't allowed to smoke. And the 15 others are smoking weed, smoking cigarettes. And it's hard to turn a building like that. It takes time. But that's the one thing that I wish we really would have known. We had to have some real tough conversations with some tenants. You know what I mean? Giving pushback. Because here, we're just trying to make this building better, but in turn, all they see is my rent's going up.
Whitney Sewell: So that can be a problem. No doubt people can be quite difficult to deal with at times, especially in this business. But oftentimes, I mean, that's why you found so much value in that building too, right? Because people weren't willing, you know, somebody else was not willing to have those hard conversations, right? And to do the hard things, right? To improve that building and that property, which, you know, that's like I said, that's how you found the value. Uh, you know, what about, uh, you know, and oftentimes, you know, so you're going into this property, you already know there's going to be a lot of repairs to be had there, right. You know, you're going to improve this property in a big way. Uh, you know, speak to how you found the team or the contractors to be able to, to make that happen as well.
Grant Warrington: Yeah. So finding contractors, that's been something I've been really good at, um, just because of necessity. So what I do is one thing is I, I create an album in my phone, right. And I'll name it contractors and anytime I'm driving. I'll take a picture of a truck, like a painting truck or a roofing company. And I'll just take a picture of it. And I'll throw those people in that album. Most of the time, I don't need them. But anytime you're driving around, you'll see a plumber's truck. You'll see all these different things. They all go in that album. One day, I might need those contractors. And I might have to go through there and start calling. The other thing I do is I go to the Lowe's ProDesk. And I ask them, hey, do you know an electrician? Do you know a plumber? Like that, right? And that's how I found one of my electricians is I asked the person at the protest, excuse me, do you know an electrician? And she said, no, I don't. And I said, okay, I walked outside and a guy came running out after me and he goes, hey man, I heard you asking in there. I'm an electrician, I'm a licensed electrician. I go, great, you do work on the side? He goes, yeah, I do. I said, fantastic. And that's how we found our first electrician. Another great thing is you go to Sherwin-Williams And I asked the manager there, hey, who do you know that's doing rehabs on properties or apartments or works for property management companies? And they'll tell you because they see them in there all the time. And that's where we've gotten a lot of referrals. I've gotten a lot of rehab crews that way. And painters as well. Obviously, painters is the easy one. But that's something I'll do. They're a great resource. And driving around the neighborhood, if you see somebody working on your neighbor's houses, stop and talk to that person. And I ask them, hey, do you work with property management companies? Uh, because if they don't, you know, I'm not looking for somebody that's going to rehab a kitchen for $50,000, right. That's just not going to work in my price point. So I will, um, I'll do that. Stop and talk to those people. And also if you're driving through an apartment complex or driving and you see, um, a painting company in there or something like that, those are apartment painters. And apartment painters are much different than residential home painters, because we can get a unit painted for, don't quote me on it, but for, let's say, $400 and for like 600 square foot, one bedroom apartment. And a residential painter is going to want to charge $1,500. So you just have to get those prices. Those apartment painters are just huge. They're invaluable. And you have to find them and ask at Sherwin-Williams, do you know any apartment painters? And that's another great way. Another great way is nextdoor.com. It's an app. And the cool thing with Nextdoor, it's only the people in your local area So you can ask your neighbors, hey, who do you guys use for plumbing? Does anybody have a painting recommendation? And that's how we found a ton of our contractors. You just, you got to put them to work and you got to watch them. And we don't pay people for labor in advance. Especially if somebody wants to show up on day one and wants some money, that's fine. When you show up, we'll give you some money, but we don't extend money out to people. We buy our own materials from Lowe's. We have those delivered in the unit, in the apartment unit. So the guys can just show up and go to work. and usually we'll pay them in draws. That way, you know, you're going to give somebody, if somebody says, I need five grand before I go to work, right? Like for my labor, it's like, no way I'm not paying you that you'll never show up. So you just got to learn to protect yourself too.
Whitney Sewell: Ask me how I know, right? 100% Grant, what's next for you? You know, what's, you know, the types of buildings that you're looking at next? Or, you know, what, what are you, we talked about actually in the local market to you now, but what are you, what's your focus now, as far as, you know, how you're going to do that locally there now and what, you know, what you said, newer buildings, but any, any, anything else that's in the next for you?
Grant Warrington: You know, I always talk about leveling up. And that's what I always want people to focus on. Whatever you take out of this, level up. Wherever you're at, just try to level up. And that's what we're looking to do. We're looking to level up out of the older stuff, getting into some newer stuff. I'm also, being a construction worker, a crane operator, Um, I want to build too. So I'm looking to build, um, I'd love to build an apartment building in the future. Um, so that's, that's something we're looking at, but, um, we haven't really, um, zoned in on one thing just yet, but we, we will be leveling up in, in some fashion here.
Whitney Sewell: Awesome. Uh, well, Grant, I'm going to transition to a few final questions for, for this segment, but, uh, what's the biggest challenge for you right now in your, your business?
Grant Warrington: I would say money. And I just wanna tell people this, cause this is something I didn't know. you're always gonna have a money challenge. I always thought once I get to a certain level, I will never have to worry about money again. That is not true. No matter what level you get to, you're always gonna have to need money. So that's the great thing too with the social capital, with people knowing you, if I ever look to raise money, which I'm currently not, But that's something we're working on now. We have a lot of equity and with the higher interest rates, that kind of derailed that refinance strategy. So we get a lot of trapped equity, which is a good thing, but we're looking at some different ways. We're gonna pull some capital and get to work on our next project.
Whitney Sewell: Do you have any predictions for the next 6, 12, 18 months for the real estate market or the economy and how that's affecting your decisions moving forward?
Grant Warrington: No predictions. I mean, I'm like everybody else and I hope interest rates are going to come down because I mean, that's going to help us tremendously. But I always want to be buying. So I always want to be in that mindset. no matter what the interest rates are. If it makes sense, it makes sense on paper. I remember a guy back in 2016, we were buying single family homes back then. And I told him I was buying a house for $70,000. And he said, I bought that same house for 25,000 in 2010. And I was like, oh my gosh. He's like, you're overpaying. And I'm like, oh my gosh, I'm overpaying. I'm making a huge mistake. But I'm like, well, the numbers make sense. So I'm going to buy it anyway. He told me, I'm going to wait. I'm not buying anything. I'm going to wait for the market to crash again. I'm going to buy that house again for $25,000. That was 2016. I think back to him and go, Wow, if I had to listen to him, I wouldn't be financially free today. I wouldn't be living in Florida today. We would not be where we're at if I had to listen to that advice. You'd probably still be operating a crane. I would, a hundred percent. So that even, I just got to chills when you said that. I really did. It's like, so I want to always be focused on buying and not worry about the economy. Just adjust and adjust my numbers. And if it makes sense, be buying. Don't buy dumb deals that got a cashflow. Just be cautious. But always be in the buying mindset.
Whitney Sewell: Yeah, that's that's so interesting. You know, yeah, I've I've experienced that same thing in the apartment. I mean, you know, in an apartment business as well. I mean, it's just, you know, people for years have said, oh, I'm not buying. I'm not buying. I'm not buying. And man, that was five years ago. And they wish now they had been, you know. Yeah. Wow. Grant, what are some of the most important metrics that you track? It could be personally or professionally.
Grant Warrington: Um, track personally or professionally. Um, man, that's a tough one because I'm not a big metrics guy. Unfortunately, that's probably one of the things that I need to get better at. Um, I would say cashflow is one we like to track. We like to track, you know, in our, um, where our expenses are, things like that.
Whitney Sewell: But, um, or maybe, uh, maybe habits that you're disciplined about.
Grant Warrington: Again, I need to be better on discipline. Man, you're killing me with these questions. But again, that's like, there's always room for improvement, but things I'm disciplined in, I do a lot with, I try to be disciplined with my content, with things like that. I try to be disciplined with, you know, how many reels I'm gonna shoot a week, stuff like that. I'm disciplined with, My schedule, like I don't drink coffee after 7 p.m. I don't eat after dinner. I'm disciplined in my personal life with things like that. I have a board here. You can't see it, but I put on that board the things I have to do every day. So I guess I am disciplined and I do have things I follow, but I don't have a lot of metrics. I'm not a real spreadsheet kind of guy. That's just not my thinking. I'm more of like a shoot from the hip kind of guy. Uh, which is probably not great, but I don't know. It's got me this far.
Whitney Sewell: It's interesting that you say that, but just from the things you've mentioned over these two segments, it's obvious that you're, you're very disciplined, right? I mean, you do think that way that you do have a number of things that you are very disciplined about, or you wouldn't be where you're at. Uh, for sure. You know, even the networking, uh, you know, building components that we talked about yesterday. I mean, there's a number of things that you are disciplined about. Uh, but, uh, no doubt. I appreciate it. Even the wall, you know, you're talking about, you know, writing down, I talk about this often as well. Like the things that are important to you that need to get done today. Right. Like there's something about writing it down, uh, that does something right. Uh, and, and you, especially you being able to see it on the wall like that. That's, uh, that's very valuable. Uh, Grant, what's, what would you say is the number one thing that's contributed to your success?
Grant Warrington: Um, I can, there's probably two. One, I quit drinking with the help of God in 2011. Without that, I would be dead today. So I mean, that's how important that is in my life. So that changed my life. It changed slowly over time, but that was the number one thing. And then, Yeah, I can't remember what the second one was gonna be, but that, yeah, that one, oh, I do remember, but that one was powerful. The second thing was I hated having a boss. And again, I'm not a spreadsheet guy, I'm not a college graduate, I'm not an engineer, I'm not all these things, but I hated having a boss so much that it burns right now inside of me when I'm talking to you about it. And I haven't had a boss in five years. But I hated it that much that I said, I'm going to figure this out and I'm going to do it. So I had a why that still burns inside me today. So without that, I don't know if I'd have been successful, but having that why and just going, I'm going to do it and nothing's going to stop me. And I made a decision. A while back I said, I don't care if I do this till the day I die and I don't make a dime. I am a real estate investor and I will do this for the rest of my life. And construction became my side job back when I had that job, right? I am like, I am a real estate investor and that's my side job now until I can get out of it. So I just had a mindset shift.
Whitney Sewell: That's so valuable. What you just said right there. So, you know, you disliked your current situation enough that you were willing to make a change, right? That's right. And oftentimes you want to say, well, you know, let's try to do these things, trying to help somebody in their life. I don't want to do those things. I'm like, well, you don't dislike your current situation enough, right? You're okay with where you're at. So that's incredible that you shared that. I'm grateful for that. How do you like to give back?
Grant Warrington: Um, I like to, I give back with my time. Um, I like to, um, again, I got that my course, um, I just now have implemented coaching, uh, for, for the people in the course. I'm like, if I can make this, if I can give them so much value. then it's just, it's really a no brainer. And that's, that's what I've done. So like, just out of the blue, I was like, Hey, every two weeks, I'm going to coach you for an hour and a half. I'm going to give you accountability. I'm going to give you all these things. We're going to go over deals together. I'm going to bring people on. It's just like, That's how I feel I can give more to people because I was that guy back in 2017 when we made the decision, we were going to buy apartment buildings. I'm like, okay, now what? I just start reading books. I just start figuring it out. And I'm like, there's, there's me out there that I can help. And that's why I kind of do all this stuff for the me in the past that needs my help.
Whitney Sewell: Grant, I'm grateful to have connected with you again, had you on the show. So grateful for your time and how you've given back to us over two segments here. And even just diving into this deal that you did and the seller financing, or ultimately how you found it as well. All the details there to how you found it, financed it, even some things around finding contractors that's so important in building that team. And so thank you so much. Tell the listeners how they can get in touch with you and learn more about you.
Grant Warrington: Yeah, you can find me on Instagram. That's the best way at Grant Warrington. I'm all over social media, YouTube everywhere, but Instagram at Grant Warrington, you can send me a DM there and the apartment buying blueprint. That's my course. You can click the link in my bio on Instagram and you can find it there or apartmentbuyingblueprint.com.
Whitney Sewell: Thank you for being with us again today. I hope that you have learned a lot from the show. Don't forget to like and subscribe. I hope you're telling your friends about the Real Estate Syndication Show and how they can also build wealth in real estate. You can also go to lifebridgecapital.com and start investing today.
