Latest / Real Investor Radio Podcast / Ep25 | Guest Alex Hemani - Ninety9 Capital: Creating a Real Estate Investment Fund
Transcript
- Craig Fuhr 00:00 You're listening to Real Investor Radio with Craig Fir and Jack Vere, where we cover advanced real estate investing topics to help you stay ahead of the curve in your real estate investing business. Craig Fuhr 00:10 Well, hey everybody. Welcome to Real Investor Radio. This is Craig Feuer with Jack Vere. Jack BeVier 00:16 It's going, boss. Craig Fuhr 00:17 Good to see you today. Hey, we're joined today. We're at the IMN Conference in Scottsdale, which Jack and I'll go through in the next episode of all the things that we've experienced and learned here. Jack just sat on an awesome panel of folks talking about DSCR loans, and so we'll talk about that in the next episode. But we're excited today to have a guest. Thanks for stopping by. Jack, why don't you go ahead and introduce our guest. Jack BeVier 00:39 Yes, super excited. We're joined today by Alex Hemani. He's in Dallas. He's a, a member of the Real Investor Roundtable, which is the mastermind that we we put on. So I've known Alex for a number of years now. Been, been great to get to know him. He is an outstanding operator out out of Dallas. He's about 300 rental properties there that he owns and manages and also operates Ninety9 Capital, which is a real estate private equity fund. They're doing some office to resi conversions and also opened the fund back up recently to, to buy a bunch of rentals. So, dude, thanks for joining us. Really appreciate it. Alex Hemani 01:11 Oh thanks for having me. Craig Fuhr 01:13 So just, let's just dispense with the, with the format out. So this means you have to come to Baltimore because you're a part of RIR, the Mastermind. So how do you like coming to Baltimore? Alex Hemani 01:23 So a backstory on that. Yeah, please. When RIR first started, all of the events were in Dallas. That's right. That's right. So I didn't have to travel. It was just, you know, I didn't have to get a hotel room. It was just, you know, I would go back and sleep in my own bed. Right. And then now last few years, they decided to move it after Covid to Baltimore. Yeah. So I gotta fly out to Baltimore Yeah. And see these guys so Craig Fuhr 01:42 Well. I'm sorry for that. Yeah. But I know for a fact that that group of folks that come into town is top-notch investors, so I'm sure you'll Oh, Alex Hemani 01:51 They're the best in the business. Yeah, it's a good deal. You have to have your A game just to join in. That's exactly right. If Jack doesn't let you through the door, Craig Fuhr 01:59 Very selective. So Yeah. It's a process. It is. So, man, I, I'm excited to hear about sort of, I love the backstory. I'd love to hear about how you got in the business and sort of have grown it to the platform that you have today. Alex Hemani 02:10 Yeah, I mean, you know, I got into it by accident. You know, it wasn't planned out. I, my wife is from Dallas, so in 2005 I moved to Dallas from Florida. She didn't wanna move to Florida, so I kind of lost that, that bet. So I ended up moving there and I didn't know what to do. So in oh six I bought my first house as a rental property, you know, 'cause houses were cheap back then, and building didn't make sense. There was not, not enough profit coming from Florida. So I bought a rental, kind of understood it, made my mistakes, bought a few more from there. And then the, and then that's how I got in. And then the great financial crisis took place, you know, and I got, at that time, I had about 20 or 25 rentals and the bank started calling all the notes. I mean, it was bad. I dunno if you guys remember or not, but I Craig Fuhr 02:59 Think we remember, don't we? Yeah, Alex Hemani 03:00 Yeah. The, this was similar experience. A 10, 20% drop. This was, the world was falling. And this was an asset class that nobody wanted to touch across the world. Right. Like housing. Oh, walk away. Right. Craig Fuhr 03:12 You went from best friend to persona, grata, unless overnight Alex Hemani 03:15 And the bank called and says, Hey, we're gonna call you note. We need you to pay us off. Well, I can't go to another bank 'cause they're gonna say the same thing. So where do you want me to go? Yeah. You know, so, so that's how I got in. And then 2010 through maybe about 2017, we started buying heavy, you know, and then in 20 amazing, Craig Fuhr 03:33 I mean, amazing period of time to be building Alex Hemani 03:34 Portfolio. It was amazing to buy Craig Fuhr 03:36 Capital. Alex Hemani 03:37 We, I got to where I needed to get to, and then in 2017, the government came calling Freddie Mac and said, Hey, we want to do a pilot program, and we want to do one of these loans to test out the single family rental space. So I was one of 20 operators, they chose to do that loan. Mm, Craig Fuhr 03:54 I remember Alex Hemani 03:54 That. Yeah. Yeah. So, so I was one of those that did that loan and did a press release on me. So, so that's when we got that done. And then I've been in the space since and last year here at IMNI won Minority Executive of the Year. Yeah. Yeah. So, congratulations. So that's been my, my journey so far, you know, and now at Nine, nine Capital, that's our new private equity fund. And our tagline and and mission is to build generational wealth. So we're gonna go back into buying rentals, but not just making money for the rich, but making money for everybody so everybody can participate and then we can grow together. Craig Fuhr 04:28 Tell us about the genesis of that idea and sort of, you know, it, it feels very heart led. Well, I'm sure there's obviously a, a, a profit motive in there as well. So tell us about sort of how that idea came about and, and more about that. Alex Hemani 04:42 Yeah, so, you know, I was in, in 2018, you know, one of our, our spiritual leader at the time had kind of given a directive of building generational wealth, right? And how do you go about doing that? Craig Fuhr 04:54 That, that would be the question, right? Alex Hemani 04:55 Yeah. How do you do it? So I said, well, you know, I went home and I thought about it. So I thought, okay, I'll build generational wealth. So I created a trust fund, put some funds, some assets in there for my kids and thought, okay, maybe that's what I was supposed to do. But I didn't feel any inside. I didn't feel like, okay, that's, that was it. So then I said, what's next? Right? So then I realized that there's a lot of investors out there who are mom and pop investors, you know, who want to participate in this space or any real estate class, right? They just don't have access. Right. They don't have access to the bigger, the Alexs of the world or Jacks of the world. Right. Because we're out there doing our own thing. Sure. And unless we take them along with us and give them that access, where are they gonna go? Right? So, so I figured that's how the building, the generational wealth came about, and that's what we're trying to do. And that's when we started. So we opened up the, the fund, the, the company two or three years ago. Right? But imagine being disheartened when you open it up, your mission is to build generation wealth and you don't launch, nothing happens. Like there's no, there's no product to buy. There's nothing that, Craig Fuhr 06:02 You know, there's, there's a vision, but, but it's still just a dream, right? So Alex Hemani 06:06 Like two years go by and I felt disheartened like, okay, I, I, I spent the money, I built everything, but nothing happened. Then what happened was the, the, the housing market interest rates went up and now there's a time, there's an opportunity right now we can launch. So we couldn't launch the last two years. We were just sitting on the sideline Jack BeVier 06:25 Just because the, the Dallas market was so hot, you weren't finding anything that was like, the way the yields made sense. Yeah. You don't Alex Hemani 06:30 Wanna just launch for the launch of it, right? You wanna launch with a product and the timing has to be right. There has to be some kind of asset class on the other end that makes sense to, to, to grow it. And single family housing today, you know, so our two biggest competitors, right? The IBU internet buyers, they're on the sideline and with mortgage interest rates around seven and a half, 8% right now, the homeowner's on the sidelines. So this opens up that window for us to buy at a discounted price that wasn't there 12, 18 months ago. Jack BeVier 07:01 Yeah. So you've seen that you, you, you feel that you've seen that in the Dallas market, that over the past 12 months, like there's enough been enough cracks in the market that you're able to now be competitive on buying as is houses and add value and get, get deals again. Alex Hemani 07:14 A hundred percent correct. Right. They weren't there 12 to 18 months ago. I would say maybe 12 to 18 months ago, you could turn on the news and you would hear some newscasters saying, 1, 2, 3 main street just sold and sold $50,000 above list price. Right. Because somebody came in bid, whatever, right. 'cause they were getting a 3.5% mortgage. They just moved in from California, had a bunch of cash, whatever. Right? Right. So those are not, that's not a great time to buy. That's a seller's market. Right. But now it's turning, turning into a buyer'ss market. I'm sure same thing's happening in Baltimore with Jack for Jack BeVier 07:46 Yeah. We started to see some cracks. We've, we've had a good couple months of acquisitions, so Yeah. So it's starting to be fun again, you know? Yeah. Alex Hemani 07:51 So, so, and, and, and I know Jack, so we're, we're one of those guys that we love buying, right. We we're not a selling gas. Right. So Craig Fuhr 07:58 It's at the right Alex Hemani 07:59 Price though. At the right price. Yeah. So when we start seeing cracks, that's when we start finally, let's go. Jack BeVier 08:04 So tell me a little bit, I'm curious about the fund. Like, so I assume you did like a Reg D Yeah. Oh, did you do like the, did you do the public offering that allows you to, to bring in non-accredited investors as Alex Hemani 08:17 Well? Yeah. So you could bring in 35 sophisticated investors, which are non-accredited. The rest have to be accredited. So this allows us to bring the, the non-accredited along with us on the journey of, of nine, nine K. But that was the reason of doing it. Right. So, Jack BeVier 08:28 Nice. That's awesome. Alex Hemani 08:29 You bring in the average mom and pop with you. Jack BeVier 08:31 That's awesome. Yeah. That's awesome. So how's, when, when did, when did you guys start buying? How's it gone so far? Alex Hemani 08:37 So we launched a fund in May. In March we launched. We're putting the, it, it was a learning process for me too, right? Putting documents together, learning the SEC laws and regulations, all that Craig Fuhr 08:48 Stuff. You'd never done anything like Alex Hemani 08:50 This, never done anything like that. I've always been a, like a sole proprietor, right? Sure. Never had partners, never. You know, so this is my first time having to answer to people, right? Yeah. Jack BeVier 08:57 How'd you, how did you find the attorney? Right? Like the, just the logistics of that for someone who's listening and thinking like, Hey, I want to go raise a fund, but like, what do I do? So like, you had to, you had to hire an attorney to do that, right? Absolutely. Like how Absolutely. Yeah. How'd you find that individual? Was it a firm that specialized in it? Yeah. Alex Hemani 09:10 So you have to find a firm that specializes in Reg D and SEC law, basically. Right? Right. Because they have, they know the tricks and trades. So I was lucky that one of the title companies that we used, their attorney was also SEC. Oh. So, so they did funds all the time. So not only did they do our fund, but they got it at, at a good price. Right. Right. So that's how we launched it that way. And then we started, back to your question, when we started buying, bought our first property in July, and now we're ramping up, you know, we're, we're, you know, we've got about 20 properties under our belt right now. Nice. Craig Fuhr 09:44 That's Alex Hemani 09:44 Fun. You know? Yeah. And that is fun. Right. And then that's the part we love to do, you know, being in the business for 17 years. Yeah. But, and, and, and, and we're off Craig Fuhr 09:53 To the races. So who do you go out to to, to solicit for funds? I, I mean, I know that the obviously accredited non-accredited. Yeah. But like, was this, Alex Hemani 10:01 So the first fund, our only fund right now, I mean, there'll be more hopefully in the future, but friends and family, Craig Fuhr 10:07 That's what I was wondering. Alex Hemani 10:08 That's who we went to first, right? Like, hey, Craig Fuhr 10:10 And is that sort of the mission of creating generational wealth Yeah. For those people? Like, Hey, you can play in the game. You know, you don't necessarily have to be the operator, but you can invest in this fund. Is that the part, is that what you mean by the generational wealth? Alex Hemani 10:22 Well, well, yes and no. They can, they can participate. But how do you build generational wealth? Right? The only way, in my humble opinion, to build generational wealth is through real estate. Yeah. If you, and I was just looking at, I was listening to a podcast about Joseph Kennedy, right? The father of John F. Kennedy. Right. Majority of his wealth was through real estate. People don't know that. But what he did was, he, he, he bought great real estate assets. He created trusts, left them for his children, and he put in the trust a caveat that they can only spend the interest or the income from the asset. So the asset continuously kept growing in value, which real estate does throughout time. So if there's anybody who's got a real example of generational wealth, ask that guy, you know, what he did, I thought was brilliant, right? Sure. So even till this day, his generations are, are eating off of the assets that he bought. So that's what I mean by building generational wealth. Jack BeVier 11:22 Yeah. Gotcha. Craig Fuhr 11:23 And sometimes I like to ask the questions that, that the audience may be thinking, and I still am, I, you know, you understand the structure. I'm gonna ask the question. So if a person wants to invest in your fund, and you're the operator buying the real estate, that person owns a fractional part of the real estate, let's say, because they've invested in your fund. Absolutely. Yeah. And so your hope in, I, I wanna get back to the whole generational aspect. Your hope is that that person keeps the money in the fund for a while and they make returns off of that. They're not really owning the real estate. Alex Hemani 12:00 Yes. So the fund owns the real estate. Yes. Because, you know, so let's say you put in $50,000 Sure. And we bought a hundred homes, right? So you technically put in $500 in each home. So you own, your equity in there is $500 per asset. And then the goal is years later is to sell it. And then we are a for-profit, of course, I, and give back a great return to these, these investors compared to what they have done by just putting it in a money market account or putting it in a stock market. I understand. And then, you know, some, and another exit could be is that you sell it, but sell enough to give their, their, their equity back and the rest is free and clear and they can eat off of that for, for whatever period of time. So there's plenty of exit strategies you could play in that. But the, the goal is to give them access. Right. So today, if I want to, if I don't have this background and I want to go into, if I live in Baltimore and I wanna buy single family homes, Jack's not giving me the time of day. Right? Okay. So unless he decides to be helpful and allow people to invest with him, he's gonna continue growing and the average person will not. Craig Fuhr 13:12 I see. What I didn't realize, and maybe you could speak to this, is that the way that, the way a fund is set up, a private equity fund is that the person not only gets a return, but then they get a part of the upside when he sells the asset. Yeah. So like, I I assume that the, the, the folks who are putting in money, they're limited partners, correct? Yeah. Alex Hemani 13:31 They're, they're, they're owners of the, of the assets and the fund. So whatever the profit is, they get their share. I Craig Fuhr 13:36 Love that. Alex Hemani 13:37 Yeah. Craig Fuhr 13:37 And then you act as the general partner. Correct. Manage all the day-to-day. Alex Hemani 13:41 Absolutely. We, we are the operators, right? Because we have the experience. So we, we acquire the asset, we fix the asset up, and we manage it to, and then we exit it. Craig Fuhr 13:48 So what's the, what's the team look like right now? Alex Hemani 13:50 Great question. So we have an acquisitions team. Their job is to just find the best deals out there. We have a construction team that comes in right behind them once we close on it and, and fix the property up to make it ready. And then we have a property management team that manages it till the end. Craig Fuhr 14:04 Sounds very familiar. Yeah. Yeah. Yeah. So how are you, so how are you, what's working right now on just Alex Hemani 14:09 FYI, I think we started in the space at the same time. Yeah. So something like, we copied him or he copied us. Craig Fuhr 14:14 No, no, no, no. I think it's, I think it's a model that's been Alex Hemani 14:17 Around the's there for Craig Fuhr 14:18 Years. Know some do it better than others. Yeah. Right. Alex Hemani 14:21 Jack is great at what he does, and Fred is great at what they do. I mean, they're at another other level. So, Craig Fuhr 14:26 You know, we've all had our learning experiences. Right. It's, it's a fun business. Yeah. So wait, so what's, what's working on the acquisition side for you right now? Is like, how, how are you sourcing deals? Is the courthouse steps? Wholesalers, direct mail? Yeah. It's crazy. Alex Hemani 14:37 We, we do a little bit of everything, right? We're not big on the courthouse steps. I think going through the courthouse steps, we see a lot of novice investors that come in there and they just raise their hand and they're, it's Craig Fuhr 14:49 Easy to buy houses. You just keep raising your Alex Hemani 14:50 Hand. Yeah. You just gotta raise your hand and just keep bidding up the price. And they're paying a hundred cents on the dollar. I'm like, what? You know? So courthouse steps is really not our thing. We have a lot of relationships with realtors, wholesalers, you know, a little bit of direct mail, but, you know, various different verticals that we get the deals through. Jack BeVier 15:06 So what's like, what's a typical deal look like? Like what's the year built bed and bath square footage? We're talking all single family here. Alex Hemani 15:12 All single family homes. We're talking about 1970s, eighties built, you know, 15, 1600 square feet, three bedroom, two bath, decent Jack BeVier 15:21 Neighborhoods, Alex Hemani 15:21 Decent neighborhood, great school districts, suburbia America, you know, white picket fence, you know, kind of like what you see in the movies, you know, just Jack BeVier 15:30 Like Baltimore. So what's, what are your, like, what do you consider a good deal? Like you're all in for how much money based off of how much and you're getting how much rent? Alex Hemani 15:40 So it all depends on the areas too, right? Sure, sure. You know what I mean? You know this, right? So sometimes we will, we will sacrifice a rent for an asset that we know we've got a lot of equity built in. Sure. And that's just a phenomenal area that we know is gonna appreciate significantly. Jack BeVier 15:55 Yeah. Oh, and and sorry to interrupt you. What, so the, the, this is slightly different off topic, but what's the timeframe when you guys expect to sell these assets in the future? Alex Hemani 16:05 2029 is my question. Oh, sorry. Okay. 2029 is when we start exiting. Okay. So two years to deploy. Okay. To buy the assets five year hold and then we start exiting. Jack BeVier 16:14 Yeah. So that, like, that backend is definitely a part of the economics, definitely part of your analysis when you're considering what a good deal is that, you know, 'cause if you, like you just said, like you might get just not, not as good of a current return, but if you're gonna get a big equity pop on the end, you'll make it up Alex Hemani 16:27 Then. Yeah. If you're, if you're still hit, if area where we know appreciation is just going crazy, right. So we know we're gonna make that way up in the back end. Right. Right, right. So we're gonna sacrifice a little bit of the rent up front, but we, we got equity play here. Yeah. Jack BeVier 16:40 It's interesting. Like I, we, so, you know, and coming from Baltimore, Baltimore's a great yield market, right? Sure. Right. Like there's really good current returns. If you look at a home price appreciation over time, you know, you take 2021 outta the scenario. It's a very boring appreciation market. Yeah. So like, you know, we get, we'd get, we'd get inflation, right? We'd get CPI from a, from a appreciation point of view, but the current yields were amazing. And so, you know, we've, I've always had like, you know, that's how I was trained like that, that's how, that's what I, you know, kind of grew up in, right? So I've always, we, we always have this like bias towards, you know, what's the current yield. But man, like, you know, something that we've just seen over the past, you know, particularly over the past couple years is like the, the, you know, from a total return point of view though, you sh though you can't like carry a property that, you know, where the rent doesn't cover the mortgage. If the rent covers the mortgage and you're in a, a strong appreciating market. I think that the, I think the biggest wins have happened by real estate investors over the past 10 years. The biggest wins have happened because of appreciation. Alex Hemani 17:44 A hundred percent. That's the play. If you wanna make money in SFR, it's an appreciation not in the yields. You want to be in a market that's appreciating, we come from Dallas, where, you know, now we have over 8 million people. Right. You know, in, in the, a lot of folks coming in SW right? Yeah. Which makes us the third or fourth largest in, in the country, right? You've got, every time you pick up the newspaper, you've got a major company moving here, right? So they're bringing in their people and then the sub companies that cater to them bringing in, right? So you've got this big growth and you've, and, and, and this conference, all we've heard is about shortage of homes everywhere, right? So Dallas is not immune to that. No one's making any more of the workforce housing, right? So therefore you've got people, influx of people moving in shortage of homes. So count on that appreciation will continue to grow. Jack BeVier 18:36 And you feel, you feel Dallas is a good market for that. Like, you still feel there's plenty of room to go, room to run. Alex Hemani 18:40 I mean, we're putting our eggs in that basket, right? So that's our backyard. We believe in that theory and that's our thesis. Craig Fuhr 18:46 So in terms of the fund now, are you still growing the fund or is that sort of, do, do you close it at some point in then? Alex Hemani 18:52 Yeah, so we close it in March of, of coming. So usually Reg D is a one year open to raise the capital. And then when December, sorry, March rolls around next year, that's when we, we were done of raising the capital. Cool. Jack BeVier 19:05 That's Craig Fuhr 19:06 Awesome. You're about to say something. No, no, Jack BeVier 19:07 I'm good. Yeah. Yeah. Craig Fuhr 19:08 So one of the things I heard that was, I thought was kind of brilliant at this conference. 'cause you talk to people that are in single family multifamily. Sure. I'm in developing, I'm doing a hundred million know, I heard this now's the time in, in a market like this to sort of stay in your lane. Yes. Is that the intent here? Just to stay with a single family lane? Alex Hemani 19:28 Or, or for, for now. Yeah. Because, you know, people always ask me like, Hey, why don't you do multifamily? Or why don't you do development? Yeah. Craig Fuhr 19:35 You've got the experience. You obviously understand Alex Hemani 19:37 Do capital and there's, and, and I want to, but this is what I know. Yeah. Right. Like, and this is my swim lane, right. This is what we know. So it's like hard to take money from other people and, and try something new like, yeah, I'd never tried it with my own money. Why am I gonna take your money and try it? Right. That that's pretty bad, right? Yeah. Jack BeVier 19:55 Yeah. Alex Hemani 19:55 You know, so I'm like, I wouldn't do that now if I was gonna go into some kind of other development or something, I would do it my money first, test it out, you know, make the mistakes and then I would come back to investors and, and mom and pops or whomever. Craig Fuhr 20:06 Right. Well that's a rare model. No, that's refreshing. Really refreshing. Anything else? Jack BeVier 20:13 So the Craig Fuhr 20:14 Few minutes left here. Yeah, Jack BeVier 20:15 I guess the, you know, like, to your point, I feel like, like single family houses, they don't, they don't feel risky to me, right? Like it's just work, right? Like, but, but I feel, you know, once you're, once you're an operator, you get your, you know what, you know, you know what a good deal looks like, you know how to operate it. Well, you've been operating your 300 for, you know, 15 years, right? And so like, you know, I, you then at that, with that level of experience, have the comfort to say, Hey, I'm the general partner. I, I I know how to do this. Sure. You know, you feel very comfortable, right? Like asking your friends and family Right. Who you're gonna have to see at Thanksgiving, you know, and holidays and stuff. So like, you're Alex Hemani 20:49 Putting your reputation on the line too, right? Yeah, absolutely. So, but being at this conference, and you know, this Jack, is that single family homes in general today are the safest asset class there is in the world, not just in the us right? 'cause anytime you have a shortage of a product and you have a demand, that product isn't, is not gonna fall in value drastically. Right. And especially now if you put on top of that, that product happens to be in one of the most growing cities in America right now, you're really protected, right? Yeah. So if you look at other office spaces, right? Our buildings keys are being handed back to lenders right now. Right. You've got commercial, we all know there's a bloodbath coming. Right? But, and, and if you look at all the asset classes this year, they've all gone down in value except for single family homes. Yeah, it's Jack BeVier 21:39 True. Even multifamily cap rates are up. Yeah. Alex Hemani 21:41 Even multifamily cap rates are up. So it's like this because there's a shortage of this product. Yeah. No one made any more of these affordable housing in the last decade. So that's why. And, and, and I'm buying in my backyard in, in a city where you have 300 some people moving in every day. So we're, we're, we're comfortable in, in, in that space now. Yeah. Yeah. You Craig Fuhr 22:02 Know. Well, man, we have you for a couple more minutes and I can't thank you enough for taking the time seriously. Hey, no worries. It's just great to talk with you. I would, I think people would kill me if I didn't ask a top operator, give us your prognosis for 2024. You know, Alex Hemani 22:17 Take out the crystal ball. Craig Fuhr 22:18 Yeah, man, pull it out. Alex Hemani 22:19 That's, and this is being recorded, so if I'm wrong, absolutely. This will be like on, on some Craig Fuhr 22:24 Kind of, well, we're coming back here this time or, and when you come back to Baltimore and we get to tell you if you were right or wrong. So I'll Alex Hemani 22:30 Tell you a a a funny story. One of the questions, I'm, I'm on a panel right after this at, at three o'clock and I'm moderating it. And the last question I have for the guests is, if you had a crystal ball where you predict for 2024. Craig Fuhr 22:42 Yeah, well, there you go. Now you get to answer. And Alex Hemani 22:44 I get this question sent back to me. Here's my thought process. I think, I don't think interest rates drop in the next year, in the next 12 months, if they were somehow were to drop, they would not drop drastically, maybe a hundred basis points combined, you know, 25, 25, 25 like they did. But I think that would be the max. I don't think it's drops at all. And this may be the new norm for a while. Right? So if you look at last year everybody was saying, oh, you know what, December of this year rates are gonna start dropping. Right? I mean, maybe it's a little bit of wishful thinking. Maybe the rates aren't gonna drop, maybe we're gonna stay like this for another 12 to 24 months. Right. Craig Fuhr 23:26 Does that equal a devaluation maybe in, in, in asset prices, or I think Alex Hemani 23:30 It's gonna flush out a lot of bad operators. It sure is gonna flush out a lot of commercial properties that's already happening. Yeah. I mean, you know, I, I read the Dallas Business Journal and Right. You know, we have, we have something called the Dallas North Tollway. We have these big office buildings, you know, and let you could, every other day you could read something where either a building's going into foreclosure or the owners have just given the keys back. Right. So that's already starting to happen. Right? Yeah. And, and this could be a good way to flush out all of that. And I think inflation is a problem. Right. And if I am, and of course I'm not a Federal Reserve, I can't predict what they're going to do, but they've made it very clear what their mandate is. They want that inflation down to 2%. Alex Hemani 24:19 Yeah. Right. And that's what they're trying to do. And if you look at your average American today, their cost of living has gone up by 20%. Right. That's a big number for an average person. Right. So they gotta control relationship. So I don't think, if I had a crystal ball, I don't think the rates come down. I don't think they go up anymore. But I think this is stability for next 12 to 24 months. Right. And this way it's a, it's just what it is. Yeah. Right. I mean, and I don't think values of houses will fall as drastically as, as if anyone predicts because there's a shortage of it, but it's market to market. Sure. Craig Fuhr 24:55 That kind of aligns with where you are. Right? Jack BeVier 24:57 Yeah. Yeah. I, I generally feel the same way about that. I think it's gonna, and therefore I think experienced operators, people who have platforms, people who have low variable costs, right. Who, who, who aren't gonna pay dumb tax getting into something new. Right? Right. Who already have a platform they can add units to. It's gonna be a great time for them to start to start adding units again. Absolutely. I think, I think the flipping market is gonna be really strong and if you can find a deal that's good enough where you can get, where you're not paying more to your lender than you're collecting from net, net operating income, adding rentals on a case by case basis too. So. Sure. Alex Hemani 25:32 Yeah. I a hundred percent agree. Craig Fuhr 25:34 Well man, we love talking with great operators. Can't thank you enough. Can tell folks how they can find you online or maybe find out what you're doing in Dallas. Alex Hemani 25:41 Yeah. So company's name Ninety9 Capital, you can, we have a monthly newsletter that comes out that gives a lot of data regarding what's going on in the housing market and, and real estate in general. So if you go to our website, https://ninety9capital.com, you can sign up for our newsletter comes out once a month. We give you a lot of insight of what's going on and, and that's about it. You can find us right there. Craig Fuhr 26:07 There's nothing more I love than good operators who act as educators as well. Jack BeVier 26:12 Yeah, absolutely. It's great content. Craig Fuhr 26:14 It is. So thank you so much for joining us, Kent. Thank you enough for the time. Appreciate it guys. It was great to have you on. Alright, thanks. Jack BeVier 26:19 Really appreciate it. Craig Fuhr 26:20 Alright, that's it for now. Coming from INN. We'll talk to you guys soon. (Generated by Podcast Show Notes at podcastshownotes.ai)