Latest / Own More Doors / #86 From 0 to 400 Doors: 4 Long Beach Investors Share How They Actually Did It

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#86 From 0 to 400 Doors: 4 Long Beach Investors Share How They Actually Did It · Own More Doors

0:00
SPEAKER_08: I know a lot of times when we're we're just getting started, it's it's frustrating, things seem expensive, or how can I ever do it?
0:06
SPEAKER_08: Um, you know, they figured out a way.
0:08
SPEAKER_08: No one was like candid, uh, hey, here's your first eight-minute building, but you know, thanks for being in our family.
0:13
SPEAKER_08: That was not the case.
0:15
SPEAKER_08: They all found a way to do it.
0:18
SPEAKER_08: Thank you guys for being here.
0:19
SPEAKER_08: We are uh we're in escrow to buy a much larger office right up the street.
0:23
SPEAKER_08: So there'll be parking, there'll be much more room.
0:26
SPEAKER_08: And so today we'll we'll be in here tight, but pretty soon there'll be a lot more room.
0:30
SPEAKER_08: Um, so we're gonna we're gonna go ahead and get started.
0:32
SPEAKER_08: Um, just a few things, and I'll and I'll just do some brief intros.
0:35
SPEAKER_08: I know I got long intros, but just for some of the things we'll start off with Brad.
0:39
SPEAKER_08: Uh Brad went to college with my younger brother, David.
0:43
SPEAKER_08: That's how I got to meet Brad.
0:45
SPEAKER_08: Uh Brad's uh impressive resume.
0:47
SPEAKER_08: I think by the time I met Brad, he already had 250 doors.
0:51
SPEAKER_08: Um and I said, hey, so do you still need to have your corporate job?
0:54
SPEAKER_08: He's like, Oh, I quit that last October.
0:56
SPEAKER_08: And I moved my job dropped because you know he got to the point in his career early on where I'm like, so you don't have to work.
1:04
SPEAKER_08: And he's like, I just oversee my properties now.
1:06
SPEAKER_08: And so really impressive.
1:07
SPEAKER_08: So we'll you know, we'll get started with him in a little bit on kind of his first property and kind of what got him into it.
1:13
SPEAKER_08: Next is Mark Belan, who uh, if you guys have seen my YouTube channel, I interviewed him several times.
1:18
SPEAKER_08: Mark's my mentor, he was the one that taught me, um, he taught me one, if you want to be a millionaire, you could get there.
1:26
SPEAKER_08: Like where other people would say, oh no, that's not for me, or no, we can't.
1:30
SPEAKER_08: Mark was the one who like showed me like this is how you do it.
1:33
SPEAKER_08: And and I got to see it firsthand, and I got to see hotels and self-storages and all types of investments, and Mark's a risk taker, and he's always going, he's still going, so to have him here today is a real treat for everybody.
1:45
SPEAKER_08: Uh, next is Brian McGuinness, and I got to meet Brian because I was selling one of Mark's buildings.
1:50
SPEAKER_08: And so Brian reached out to me, and that was the first time we met, and Brian had a lot of questions, and Brian's very thorough.
1:56
SPEAKER_08: Since then, we've been able to get him into different properties that he's purchased throughout Long Beach.
2:01
SPEAKER_08: And Brian has also been on our YouTube channel, he's been on our podcast.
2:05
SPEAKER_08: Um, he's uh probably the most famous person up here on the on the analog.
2:13
SPEAKER_08: Um but you know, we've been we met the YouTube channel.
2:16
SPEAKER_08: That long talk, okay.
2:20
SPEAKER_08: Next we've got Victor Fitz, and I met Victor.
2:22
SPEAKER_08: Uh they were looking for an office building.
2:24
SPEAKER_08: Victor, um, he's up to 26 Jersey Mike's locations all throughout Southern California.
2:28
SPEAKER_08: They needed an office building.
2:30
SPEAKER_08: I was selling one.
2:31
SPEAKER_08: They decided not to buy that one, but that was kind of our first connection.
2:34
SPEAKER_08: And then since then, he he's got into syndication.
2:37
SPEAKER_08: They've purchased a lot of properties throughout Long Beach.
2:39
SPEAKER_08: We've been able to do business together.
2:40
SPEAKER_08: He's been very supportive of my business, and I appreciate uh Victor very much.
2:44
SPEAKER_08: So we're gonna get started.
2:46
SPEAKER_08: I'll start asking some questions, and uh, you know, after I'm done with my questions, I'll open it up to you guys.
2:51
SPEAKER_08: Uh everything will be reported until pretty soon.
2:53
SPEAKER_08: Are we good with audio?
2:54
SPEAKER_08: Everything's good, Sam.
2:56
SPEAKER_08: Awesome.
2:56
SPEAKER_08: Um, so we'll start off.
2:58
SPEAKER_08: Uh Brad, I'll start with you.
2:59
SPEAKER_08: Um, what was like what was the first building you bought and why did you buy it?
3:04
SPEAKER_08: Like who who told you to buy it?
3:07
SPEAKER_01: Okay.
3:07
SPEAKER_01: Um the first building I bought was off of Anaheim in Atlantic.
3:12
SPEAKER_01: It was a four-unit property in 2013.
3:15
SPEAKER_01: I graduated college in 2009 uh and started working and kind of early on realized that you know, working a very demanding job, you know, 50, 60 hours a week, sometimes on the weekends, um, I couldn't do it forever.
3:34
SPEAKER_01: And I was researching ways to supplement my income.
3:41
SPEAKER_01: And so um, yeah, so four units in Long Beach.
3:46
SPEAKER_01: There was uh four one bedrooms.
3:48
SPEAKER_01: Um they're very functional units, they were around 700 square foot each.
3:53
SPEAKER_01: Um my dad was a teacher in Long Beach for 20 years, uh, retired, taught at Cabrillo High School.
4:00
SPEAKER_01: Uh, and my dad had um had kind of an up and down financial life, but purchased a 12-unit building up of PCH and Cherry.
4:09
SPEAKER_01: And so I was I worked on apartments when I was a young with my dad painting units and picking up trash.
4:15
SPEAKER_01: And so it kind of a little bit was ingrained in me to figure out a way to supplement my income.
4:23
SPEAKER_01: Um, and uh yeah, uh I remember going there at night with my dad and walking around and saying, hey, you know, is this somewhere I could live?
4:32
SPEAKER_01: And you know, what was the neighborhood like on the weekends at night during the day?
4:37
SPEAKER_01: But um I at the end of the day I was determined to invest my money to figure out a way um yeah, to uh, you know, at the end of the day, create a future if you can talk about your retirement and relying on your properties for retirement, and what better way than you know operating the building, having tenants, you know, pay for your mortgage and all those things.
5:00
SPEAKER_01: And if you have a little extra, it goes into your pocket, and then one day you can you wake up and go, Oh wow, now I have a property that might be paid off or have a low balance and it's appreciated over time.
5:10
SPEAKER_08: And on that first one, your dad was okay with you buying you that area?
5:14
SPEAKER_08: He was supportive of it?
5:15
SPEAKER_01: Yeah, he was uh, I mean, very supportive.
5:17
SPEAKER_01: Um, you know, um I bought it with a friend, my uh college roommate, and we lived in the uh one bedroom.
5:24
SPEAKER_01: So I lived in the living room and he lived in the bedroom.
5:27
SPEAKER_01: And uh at the time I was living in Newport Beach, everyone thought, oh, you're crazy.
5:32
SPEAKER_01: I would never live in the living room, your lifestyle, everything's gonna go south.
5:36
SPEAKER_01: And I go, I'm just so determined to figure to find a new path.
5:41
SPEAKER_01: And yeah.
5:42
SPEAKER_08: Awesome, awesome, great.
5:44
SPEAKER_08: Mark, um who who inspired you to buy your first year, or maybe get you into buying apartment buildings.
5:54
SPEAKER_06: I was uh young in the family, and uh I needed to have a house.
5:59
SPEAKER_06: But during that time, we were talking late 70s, a lot of you don't know it, but gas was not available, and just like in Moscow, we were pushing cars towards the station to fill up because gas was tight.
6:13
SPEAKER_06: Banks were not lending.
6:15
SPEAKER_06: Your bank would not lend at any rate because no one knew what the market was going to be, and no one wanted to make a loan and be underwater with their new loan uh against that unknown collateral.
6:27
SPEAKER_06: But there were a lot of owner carry notes available.
6:32
SPEAKER_06: Owner carry.
6:33
SPEAKER_06: So if a person needed to sell their house, they had to carry it or find somebody that had enough money to cash them out.
6:41
SPEAKER_06: So that I needed a family house, and uh we were in Cyprus, and we bought a little gnarly house, but the people who are selling it were willing to carry the paper.
6:52
SPEAKER_06: And so uh we stayed there uh until the daughter graduated from uh Cyprus High School.
6:57
SPEAKER_06: And that gave you guys enough money to then start buying apartment buildings?
7:01
SPEAKER_06: When we sold that house, we bought uh a house with a duplex right over there.
7:05
SPEAKER_06: You can kind of see it on the other side of that roof.
7:08
SPEAKER_06: And uh yeah, we still own it.
7:09
SPEAKER_06: We don't live there anymore, but we still own it.
7:11
SPEAKER_06: And and that was one that I bought to fix and flip.
7:15
SPEAKER_06: I was gonna fix and flip, right?
7:16
SPEAKER_06: I was new with my real estate license and all that.
7:19
SPEAKER_06: And uh turned, I started putting on the paint, and then the wall started coming off on the roller, and it turned out to be a lot bigger job than I thought.
7:28
SPEAKER_06: And finally at the end, I thought I thought, okay, it's finished, it's clean, it's nice.
7:33
SPEAKER_06: And I'm telling you, for six months, we kept our food, our refrigerator, in the garage down the street because my wife would not use the kitchen in that house until it was remodeled.
7:45
SPEAKER_06: Okay, six months it took for that to happen.
7:48
SPEAKER_06: Bottom line is uh the property now is it paid?
7:55
SPEAKER_06: I think it's almost paid for it, but the rents are astronomical compared to what they were when I bought it back then.
8:02
SPEAKER_06: And since then, more, more, buying more, buying more.
8:05
SPEAKER_06: So that really taught me to have the units.
8:08
SPEAKER_06: Once you had that 100 income coming in, and in the beginning, in the beginning, my tenants were paying, let's say, 450 a month, but their share of the mortgage was 900 a month.
8:21
SPEAKER_06: What I'm saying is that if you take your mortgage that you're paying and you divide it by the number of square feet you have, in the beginning, especially if you're not coming with a big down payment, you may actually have to subsidize the tenants.
8:35
SPEAKER_06: Because they're if they were paying what the mortgage is, they'd go be buying them, right?
8:39
SPEAKER_06: So they're paying less of what the mortgage is.
8:41
SPEAKER_06: And so consequently, sometimes you either come with a bigger down payment or you come with a monthly payment for the pride of ownership.
8:49
SPEAKER_08: Okay.
8:50
SPEAKER_08: Well, I'm glad you said that because everyone, a lot of people, hey Juan, I want to buy something at cash flows and I can put 3% down.
8:55
SPEAKER_08: And I'm like, oh I can't make that happen.
8:58
SPEAKER_08: I know I can't.
8:59
SPEAKER_08: I did too, by the way.
9:01
SPEAKER_08: He knows that calls me.
9:03
SPEAKER_08: You know better.
9:05
SPEAKER_08: Ryan, tell us about the first.
9:06
SPEAKER_08: I, you know, I know you're, you know, what you did before you started owning real estate, but what was your first apartment building?
9:14
SPEAKER_05: Wow, okay.
9:16
SPEAKER_05: And this is probably a good story because the first apartment building, I was with a an investor group, and I learned a lot about what I shouldn't do because somebody else was managing that money, and I wasn't that involved.
9:31
SPEAKER_05: So that's that's probably a good lesson for everybody.
9:33
SPEAKER_05: If you know when when you get involved in something, get involved and kind of be hands-on as much as you possibly can.
9:41
SPEAKER_05: Uh, and this was early, early on with the multifamily.
9:45
SPEAKER_05: I had some uh single family homes before that that were you know two blocks away from where I lived.
9:54
SPEAKER_05: And of course I was there, I was managing it, and uh that got me really started in understanding the value of real estate.
10:06
SPEAKER_08: Um you and I don't know what started first, like owning all these franchises or or doing investments, but at what point did you get into investments and maybe who told you to do it?
10:17
SPEAKER_08: The real estate side?
10:18
SPEAKER_00: The real estate side by accident.
10:21
SPEAKER_00: Um my wife and I were living in Sherman Oaks, uh, and her job was in Central City, and my job was downtown Los Angeles.
10:31
SPEAKER_00: And it's pretty easy for both of us to get to work.
10:34
SPEAKER_00: They would relocate her office from Central City to Irvine, California.
10:39
SPEAKER_00: And the drive from Sherman Oaks to Irvine was was ridiculous.
10:42
SPEAKER_00: She'd had to leave at a ridiculously early time in the morning and come home late and just kind of wearing her down, wearing it down, and I and I and I told her, I said, We gotta we gotta move.
10:52
SPEAKER_00: He goes, and Long Beach is kind of central to Irvine, central to downtown Los Angeles, um and we're gonna rent what we have right now.
11:05
SPEAKER_00: And she comes home from work one day and says, uh we can we can move to Long Beach whenever you're ready.
11:12
SPEAKER_00: I got someone to rent uh the the condo that we had.
11:15
SPEAKER_00: And and I said, How much how much did you tell her how did you figure out what the rent's gonna be?
11:20
SPEAKER_00: She well I just told her what our mortgage was and she can make the mortgage payment.
11:23
SPEAKER_00: Then that that's we didn't know anything about how how did yeah and then we got somebody uh to live there, and then we moved down to the Long Beach Peninsula, been here 30 years, and kind of that was our accidental entry into uh residential real estate.
11:43
SPEAKER_08: Perfect.
11:44
SPEAKER_08: Um, I'll move over to to Brad.
11:46
SPEAKER_08: Brad does a lot of like he he'll raise money, he'll find a property, someone will bring it to his attention, he'll he'll do all the numbers, realize it's something I want to buy, and then he'll raise money.
11:57
SPEAKER_08: Um Brad, so right now with interest rates being high, does that change your strategy on whether you know some investors might say interest rates are high, therefore I'm not gonna buy.
12:08
SPEAKER_08: Does does having higher interest rates change your strategy and syndicating and kind of crowding together money?
12:15
SPEAKER_01: Umes it change my strategy?
12:18
SPEAKER_01: Um I would say the higher interest rate environment can affect the return profile that you need to give to your investors because perhaps there's alternative investments up there that are gonna generate a higher return.
12:34
SPEAKER_01: You know, if treasuries are tenure treasuries at like 470 or so, it's like that's the risk-free, you know, super safe investment, or at least it's always it's always has been, and I think it will be.
12:48
SPEAKER_01: But uh then that means the return that you're underwriting and you're gonna generate should be that rate plus a risk premium to that.
12:57
SPEAKER_01: And so I've seen uh preferred returns go up.
13:00
SPEAKER_01: Maybe when interest rates were 3%, you could get away with a six or seven percent preferred return, but then maybe that's closer to an eight or nine today.
13:10
SPEAKER_01: Um and then, but uh on the counter on the other side is that the asset needs to be priced at the right um number, basically to justify better returns for your clients and for myself and for my investors.
13:27
SPEAKER_01: So that means uh, you know, if back in the day a five cap was a normal you know cap rate for a transaction, maybe today it's a six cap or low six cap.
13:38
SPEAKER_01: I think what what I've seen today is kind of probably low six cap, which tend to tend to be where the market is.
13:44
SPEAKER_01: Um but yeah, so it's just you know pricing, pricing risk and um and then being able to quantify it and justify it to my investors.
13:53
SPEAKER_08: Are you are you still buying today?
13:56
SPEAKER_01: Yeah, um I just bought uh 22 units off of uh Eighth and Alamitos and Anaheim and Gundry.
14:05
SPEAKER_01: Um I closed uh end of May.
14:07
SPEAKER_01: I bought another 26 units in January off of Locust and PCH.
14:13
SPEAKER_01: We bought I bought in Linwood nine units uh in November.
14:17
SPEAKER_01: So yeah, we're still active.
14:19
SPEAKER_08: So none of what's happening, you know, people will call me and say, uh insurance is high, uh, you know, California keeps being really strict on on all these tenant laws.
14:29
SPEAKER_08: And a lot of people are selling because of these things, but you're you're over here buying.
14:33
SPEAKER_01: We're buying.
14:34
SPEAKER_01: Um you know, the environment's more challenging to work, um to work in today that there's there's more risk.
14:42
SPEAKER_01: There's political risk, there's um insurance risk, operating costs are higher, the cost to turn units is higher.
14:49
SPEAKER_01: So um well, I'm buying, but I you figure out how to price that into the transaction, you know.
14:55
SPEAKER_01: And um when I price those things in, and you know, I operate a portfolio of close to 400 units, and so I kind of my numbers are, you know, I I know what it costs to turn units, I know what it costs to go through the legal process to get rid of a bad tenant, I can bake in the cost for cash for keys.
15:15
SPEAKER_01: Um so you know, whatever the business is, if I have to update electrical panels, update a roof, um, I have pretty good numbers as far as what that costs, or I can call the right person to help me um underwrite that to help me quantify what that is, so then I can price that into the transaction.
15:33
SPEAKER_08: Perfect.
15:34
SPEAKER_08: Mark, you you know, I I had the opportunity to see Mark.
15:38
SPEAKER_08: Uh when I first met him, he was buying apartment buildings, uh, small like commercial buildings, um, where it was like a single tenant situation, and then he would chop it down.
15:47
SPEAKER_08: And then the one thing that I really took away from Mark is he said, look, Juan, if you have a commercial building with one tenant, they're only they're only gonna pay so much per square foot.
15:54
SPEAKER_08: But if you make them smaller spaces, what you charge per square foot now goes up, and now you have three or four tenants.
16:00
SPEAKER_08: So the risk is now uh spread across different tenant base.
16:04
SPEAKER_08: Um and he's like, and now overall the income, the income uh is now higher for the same building had it had a single tenant.
16:12
SPEAKER_08: So he did a lot of this, and then he taught me how to pull permits and I got to learn all this stuff.
16:16
SPEAKER_08: Um and so what I took away was you know kind of the uh the higher the income, the higher the value, right?
16:22
SPEAKER_08: And so everything we look to buy now is well, how can we improve the income so we can raise its value?
16:27
SPEAKER_08: Uh Mark, you've done tons of investments.
16:29
SPEAKER_08: What what type of stuff is exciting you now?
16:32
SPEAKER_08: Um, and what are you buying today?
16:34
SPEAKER_06: The market is always changing, okay?
16:37
SPEAKER_06: Uh for example, uh for a while, for years, uh FHA made loans 3%, 5%, 10% down, and someone can buy a four plex.
16:47
SPEAKER_06: It was interesting.
16:48
SPEAKER_06: Now you can't do that.
16:50
SPEAKER_06: The market is always changing.
16:52
SPEAKER_06: So today's market is uh ABUs and SB9s.
16:56
SPEAKER_06: So I'm a uh a small-time investor, and then I buy small properties, okay, and I buy a house and I'll stick two houses behind it.
17:05
SPEAKER_06: And so you turn a one house into three houses, much better than triplex because they have no common walls.
17:11
SPEAKER_06: Everybody has their own little front yard and little backyard, so way better than a condom, okay, or a stacked flat as you see them.
17:18
SPEAKER_06: So that's what I'm doing now.
17:19
SPEAKER_06: It's kind of like my retirement gig that I'm doing these uh ADUs and SB9s, which is an ADU by a different name, but it's all the same.
17:28
SPEAKER_06: Um yeah, to do the big stuff is really exciting.
17:32
SPEAKER_06: I've always thought about it.
17:33
SPEAKER_06: But the syndication work and uh I just found that I was easier if I was in a small company, and uh then I could choose what I was doing each day.
17:43
SPEAKER_06: And so it really was discretionary.
17:45
SPEAKER_08: Well, wait, well, wait.
17:46
SPEAKER_08: You know, it's interesting, he says the big stuff.
17:48
SPEAKER_08: He did own a hundred-room hotel in Catalina, so the big stuff.
17:52
SPEAKER_08: That is the big stuff, you know.
17:53
SPEAKER_08: Um, Brian, so then I'll go off to you.
17:56
SPEAKER_08: Um you're you're always looking for deals.
17:58
SPEAKER_08: Where are the deals on the MLS or are they on Loopnet, or is it is it brokers calling you directly?
18:03
SPEAKER_08: Like where are you finding where are you finding deals?
18:06
SPEAKER_08: And and and so that's the first question.
18:08
SPEAKER_08: The second part is what is a deal to you?
18:13
SPEAKER_05: Okay.
18:14
SPEAKER_05: Well, first off, I have to thank you for inviting me in these four guys.
18:20
SPEAKER_05: Um I'm so happy that I've uh I've worked with every single one of them.
18:25
SPEAKER_05: Uh Brad, you're you're way too big for me.
18:29
SPEAKER_05: But we go out to coffee and we talk all the time.
18:32
SPEAKER_05: But um the two questions are what would the where do you find deals?
18:37
SPEAKER_08: Yep.
18:37
SPEAKER_08: And then what is to you, what is a deal?
18:40
SPEAKER_05: Right.
18:40
SPEAKER_05: Yeah, okay.
18:41
SPEAKER_05: The um where do I find deals?
18:44
SPEAKER_05: And this is probably something that everybody in the room should work on.
18:49
SPEAKER_05: If it's on the MLS, it's probably not a good deal for you.
18:53
SPEAKER_05: You want to get that phone call, hey, I'm thinking about listing a property, right?
19:00
SPEAKER_05: And once you go take a look at it, once you drive by it, um, I'm really lucky that I've purchased from the same seller a couple of times.
19:13
SPEAKER_05: Okay, and I think this is really important because if you treat the sellers fairly, then if they have other properties, they're gonna call you and then you know, you're gonna call Juan and say, hey, you know, make this thing happen.
19:28
SPEAKER_05: So if you have to wait for the MLS, I think you're probably behind that.
19:33
SPEAKER_05: And then, you know, you're gonna get into a, you know, the hot water here doesn't work, and I need a$700 credit.
19:40
SPEAKER_05: And I I think we're all too busy to go down that path.
19:46
SPEAKER_05: You know, let's make it real simple and so try to deal with good quality people.
19:50
SPEAKER_05: I think that's the number one thing.
19:53
SPEAKER_05: And the deals that I look for are um I hear about it, somebody will say, uh, you know, we're getting up, we're gonna start to retire, and I'll nurture them.
20:05
SPEAKER_05: I'll I'll reach right out and say, let me know when you're ready.
20:09
SPEAKER_05: And I really enjoy getting those phone calls, and not only in real estate, but I also have self-storage.
20:18
SPEAKER_05: And when I get a phone call and uh from one of my competitors and they say, We're thinking about selling, can you help us?
20:27
SPEAKER_05: And I my first thing out of my mouth is, yeah, I can help you, I can buy it.
20:32
SPEAKER_05: And you know, put it on the market, see what you can get.
20:36
SPEAKER_05: But you've known me for so many years, let's see if we can put something together.
20:42
SPEAKER_05: And then you can, you know, maybe some seller financing that you know Mark got started with.
20:48
SPEAKER_05: But then you're working with good people, and and that's my number one criteria is you know, don't give me an apartment building.
20:58
SPEAKER_05: I I don't want it if you're gonna give me headaches.
21:01
SPEAKER_05: You know, even if the price is way under market, I'd rather deal with good quality people.
21:08
SPEAKER_08: So um one thing I've seen Brian do when he's buying a building, I more than anybody else, Brian really spends a lot of time talking to the tenants.
21:18
SPEAKER_08: A lot of time.
21:19
SPEAKER_08: Makes me uncomfortable.
21:19
SPEAKER_08: I'm like, oh, he's got he's gonna ruin the deal.
21:22
SPEAKER_08: He's saying too much.
21:24
SPEAKER_08: But but then also what Brian does, and I was surprised the very first time we closed on on the first building that I got to work with him on, it was the day that um you know the ownership was going to transfer to Brian.
21:34
SPEAKER_08: Brian shows up with uh gifts.
21:37
SPEAKER_08: No one does this.
21:38
SPEAKER_08: Gifts for the tenants.
21:40
SPEAKER_08: Hi, I'm the new owner on Brian, and like flowers.
21:43
SPEAKER_08: I don't know if you remember this was on like uh A Cherry.
21:46
SPEAKER_08: And I was I was surprised.
21:47
SPEAKER_08: And so I don't know if he always does that, but I'm like, what a good way to kind of start off that relationship, right?
21:52
SPEAKER_08: Because a lot of times when you buy a building, they're afraid of you, you know, you're gonna raise the rent or ask them to leave there and they don't know what your intentions are.
22:00
SPEAKER_08: I think Brian handled that perfectly.
22:02
SPEAKER_08: Uh, part two of my question is um when when you're looking at a deal, when do you know it's a deal?
22:07
SPEAKER_08: So that they, you know, they can maybe learn, like, well, this is what Brian thinks is a good deal.
22:10
SPEAKER_08: Like, whether it's uh the gross rate multiplier or a cap rate or a price per square foot, like when do you know like instantly that is a good deal?
22:18
SPEAKER_05: Well, you know what?
22:19
SPEAKER_05: Most of the time I ride my bicycle and I drive the area, and somebody will be walking out of the building and say, hey, how you doing?
22:30
SPEAKER_05: You know, do you live here?
22:31
SPEAKER_05: Yeah, yeah, I live here.
22:33
SPEAKER_05: And I get a feel.
22:36
SPEAKER_05: You know, are you a happy person?
22:40
SPEAKER_05: Are you being treated fairly?
22:43
SPEAKER_05: And I I just okay, I like the building.
22:45
SPEAKER_05: And then I look at it and go, you know, is there deferred maintenance here?
22:49
SPEAKER_05: Is there um you know pride of ownership?
22:53
SPEAKER_05: And then I start looking at numbers.
22:55
SPEAKER_05: And you know, if the numbers work out, then I'm in the game.
23:00
SPEAKER_05: But if it's you know, hi, um I'm riding my bike, this looks like a good area.
23:06
SPEAKER_05: I hate this place, it's it's the worst place in the world, the neighbors next door, okay, great, and then you know, I'll keep riding and I'll I'll get a feel before I look at numbers.
23:16
SPEAKER_05: And I think that's that's more important.
23:19
SPEAKER_05: The end game of me being able to sleep at night and be so happy.
23:25
SPEAKER_05: I'm I'm the happiest guy, literally, I think, in the world.
23:28
SPEAKER_05: Um and in order to do that, I have to um find the right deals.
23:37
SPEAKER_08: Um, Brian, I it might be three or six months.
23:41
SPEAKER_08: For three or six months, he was waiting for a car to be delivered that he ordered.
23:45
SPEAKER_08: And he sold his current car, his current car broke down.
23:48
SPEAKER_08: And for three or six months, he was riding around his bike everywhere.
23:52
SPEAKER_08: I'd see him at the bank, and I'd see he was always in his bike.
23:55
SPEAKER_08: So I would tease him.
23:56
SPEAKER_08: I saw him outside of the bank one time, and I I went up to him and I thought he uh um I joked.
24:02
SPEAKER_08: Um I say, but I remember that.
24:05
SPEAKER_08: Yeah, I said, Brian, you strike me as someone who doesn't have a home, you know, because he's just out on his bike.
24:11
SPEAKER_08: But you know, here and he owns a bunch of units in Long Beach.
24:14
SPEAKER_08: But um, Victor, um, you've done a lot of renovations, and I've seen some of your projects.
24:20
SPEAKER_08: And Victor's someone who um the buildings that I know he owns, I mean, they're all up second, third street, really good areas.
24:26
SPEAKER_08: You know, I from what I've seen, he stays away.
24:29
SPEAKER_08: And look, everyone's got different strategies.
24:31
SPEAKER_08: I mean, if you hear the streets where Brad's buying, they're probably not the streets that Victor's buying.
24:35
SPEAKER_08: They're just not, they're completely different.
24:37
SPEAKER_08: You go down to the studs a lot of times, but you've done a lot of renovations.
24:41
SPEAKER_08: What's like um a renovation that you've done where you know the return is there?
24:46
SPEAKER_08: Like either the rents went up or the value went up because you've done it.
24:50
SPEAKER_08: Like, I guess the biggest bang for the butt on a renovation.
24:54
SPEAKER_00: I'd probably say uh the building that we have on 4th Street, I think it's 1820 or 1840, it's right across the street from the pike bar.
25:04
SPEAKER_00: Uh and it used to be an old hotel.
25:08
SPEAKER_00: So it's it's a it's an apartment building, so it's got the interior hallways.
25:13
SPEAKER_00: But what we really did, we were able to add two really nice ADUs in the back and still create a carport for five parking spots, five parking spots there, created two good-sized ADUs, about 900 square feet, two bedroom, uh, one bath.
25:32
SPEAKER_00: You know, you look at what they cost to build those or renovate that we want to do versus the rent that we're getting there, slammed up.
25:40
SPEAKER_00: Because you already own the land, right?
25:42
SPEAKER_00: And you were able to get a little bit of a lot of things.
25:44
SPEAKER_00: That's exactly what I thought about.
25:46
SPEAKER_00: You you own the land.
25:47
SPEAKER_00: How can you create more value uh with within it?
25:51
SPEAKER_00: Um I I I'd say that we're able to do that, and we'd be able to do it in a few other places.
25:57
SPEAKER_08: What do you make of today's market?
25:58
SPEAKER_08: I mean, you've seen it, you know, you've seen the run-up on values, and then you've seen the come down on values.
26:03
SPEAKER_08: What do you make of what's happening today?
26:05
SPEAKER_00: Yeah, I don't I don't get caught up really um in the day-to-day value because it's it it's almost like people that look at the stock market every day and it's up one day and one down one day.
26:19
SPEAKER_00: We're not buying or sell, we're not selling today.
26:22
SPEAKER_00: So if it's the value of your house is down or your real estate investment is down that day, it only affects you if you had to sell it that day.
26:29
SPEAKER_00: Yeah, you know, I I think you gotta play the long game and look long term.
26:33
SPEAKER_00: I think what you talked about before is where I was talking about that you you own it all of a sudden you say you barely, you know, your example I want to put 10% down, I want to buy a really nice billing, and I want a cash flow spending.
26:44
SPEAKER_00: It's not gonna happen.
26:45
SPEAKER_00: You know, I uh you guys hear that 10% down on the cash flow?
26:50
SPEAKER_00: I I I I'll give you a perfect perfect example is I own a house on on the Long Beach Peninsula, 1460 first place.
26:58
SPEAKER_00: We've owned it.
26:59
SPEAKER_00: Um Thanksgiving week it'll be 27 years that we we've owned it.
27:06
SPEAKER_00: I bought it for$555,000, I think.
27:10
SPEAKER_00: It's you've looked at you looked at it for me.
27:13
SPEAKER_00: It's worth over two million dollars today.
27:15
SPEAKER_00: I don't know anything on it.
27:16
SPEAKER_00: I you know, and it's but we just I guess like$7,500 a month in rent.
27:24
SPEAKER_00: You know, when I first started renting it, it goes there was just a little bit of money you're making.
27:27
SPEAKER_00: Now it's it's all profit.
27:30
SPEAKER_00: And uh, you know, I I would I should sell it because I got a lot of money tied up in in one piece of of property with no leverage on it.
27:38
SPEAKER_00: Uh but I got a wife and daughter, they get emotionally attached to things.
27:42
SPEAKER_00: They're emotionally attached to me, that's why they don't get rid of me.
27:47
SPEAKER_00: But uh yeah, we we should sell it and leverage it, but you know the the the way I look at it, I I I I had a goal.
27:55
SPEAKER_00: I I uh actually my sister-in-law came over this morning uh to help watch my mom uh while I came here.
28:02
SPEAKER_00: And uh she goes, I was going through all my photo albums and on your cameras because I found a picture when I took you guys to the airport of you dropping uh a check in the mail.
28:12
SPEAKER_00: You had Mia, my daughter, she was 10 years old at the time.
28:15
SPEAKER_00: He goes, I go, yeah.
28:16
SPEAKER_00: He goes, You remember that was?
28:17
SPEAKER_00: He goes, No.
28:18
SPEAKER_00: He goes, he goes, we were paying off the mortgage.
28:20
SPEAKER_00: I I I had a goal, I said I want to pay off the mortgage on that house uh before my wife turned 50.
28:26
SPEAKER_00: And that was like a couple weeks before she turned 50.
28:29
SPEAKER_00: So I took a picture of my 10-year-old dropping the check in the mail.
28:32
SPEAKER_00: Okay, that's amazing and getting paid off.
28:34
SPEAKER_08: That's amazing.
28:35
SPEAKER_08: Uh, just a couple of things.
28:36
SPEAKER_08: So a lot of people are are when they have a rental house, you know, so they'll they'll come to our office and we're like, okay, if you you know, what's the return on on equity uh with this rental house?
28:47
SPEAKER_08: So so in his perfect situation, and Victor knows this now, he doesn't need to kill it in every investment in his life, so he's probably not generating the best return there.
28:56
SPEAKER_08: But in a lot of cases, let's just say there was, I don't know, two million dollars worth of equity in that.
29:01
SPEAKER_08: That to me would buy five, six million dollar apartment building, that you're buying at a discount.
29:06
SPEAKER_08: So to me, I'm like, you should do that, you know.
29:09
SPEAKER_08: But again, you don't always have to do that.
29:11
SPEAKER_08: Brian, I'm gonna move off to you.
29:12
SPEAKER_08: Uh, a lot of times people contact me and they'll say, Oh, Juan, it's just so expensive to buy here.
29:17
SPEAKER_08: I think I'm just gonna go out of state.
29:18
SPEAKER_08: I think I'm gonna go to Texas or I'm gonna go to wherever.
29:21
SPEAKER_08: Um, I know, I know your self-storages are out of state, but I believe all your apartments are here in Long Beach.
29:27
SPEAKER_08: What is it that keeps you here and and not chasing this like cheaper values out of state that a lot of people tend to do?
29:35
SPEAKER_05: Well, actually I have some in Seal Beach and Huntington as well.
29:41
SPEAKER_05: But I live in Long Beach, and you know, it's uh kind of hard to ride to Texas on my bicycle.
29:51
SPEAKER_05: Um you know, I I just love Long Beach.
29:55
SPEAKER_05: Long Beach, I I graduated from Palestate Long Beach, and you know, this is part of me, and I want to be as uh involved in the community as I can.
30:06
SPEAKER_05: And I know this area, you know.
30:09
SPEAKER_05: I I think in Texas you can buy a uh a cheaper unit and probably get equal rent.
30:16
SPEAKER_05: But I just like to be involved and drive past and look at what's going on.
30:23
SPEAKER_05: And it's more of a uh since I sold my business, it's more of kind of a hobby, uh, multifamily.
30:30
SPEAKER_05: And that's another issue that I have is I have you know, I can't have just a little hobby.
30:36
SPEAKER_05: You know, I just keep on growing and growing.
30:40
SPEAKER_05: And uh so that's why I'm I'm here.
30:44
SPEAKER_05: And I think there's a lot of value in Long Beach, especially right now.
30:48
SPEAKER_05: Someone mentioned the political.
30:50
SPEAKER_05: Um, you know, if you can get a handle on the political end of Long Beach, I think you're really uh ahead of the game.
30:58
SPEAKER_05: A lot of people are giving up in Long Beach because you know, of that political situation.
31:04
SPEAKER_05: It it'll get better.
31:05
SPEAKER_05: Yeah, perfect.
31:08
SPEAKER_05: You know, one other thing I Victor was talking about this earlier and somebody else mentioned deferred gratification, sleeping in the uh uh living room.
31:21
SPEAKER_05: And you know what, if if you're an investor and you wanna if you really want to get ahead, you have to do that.
31:28
SPEAKER_05: You know, if you want four percent, put your money in the bank and you don't have to worry about it.
31:33
SPEAKER_05: But if you want you know a better return and a long-term return, real estate's the way to go, you know, hands down.
31:44
SPEAKER_05: And uh, you know, the interest rates are high, inflation's high, you can buy gold and make a ton of money.
31:52
SPEAKER_05: Forget about all that stuff.
31:54
SPEAKER_05: Just get into real estate and you're gonna lose.
31:58
SPEAKER_05: But then the next one, you're gonna make more, and then all of a sudden, and Victor, you and I have to talk, you have to refinance that house.
32:08
SPEAKER_05: We're gonna get we're gonna get to that.
32:09
SPEAKER_05: No, no, no, no.
32:10
SPEAKER_05: That's bad advice.
32:11
SPEAKER_05: He had the list with me.
32:12
SPEAKER_05: Okay, that's a better advice.
32:14
SPEAKER_05: Victor, what I say, you have you got to refinance that get some money out of it.
32:18
SPEAKER_05: But Victor's a good guy, but you know that you just have to keep on leveraging and at every deal, go for broke.
32:28
SPEAKER_05: I mean, I'm not gonna lose my house.
32:30
SPEAKER_05: None of us are gonna lose our house.
32:32
SPEAKER_05: But if you really want to get ahead, every deal go for broke, and you know, you're gonna lose a lot, but you're you're gonna really make it long term.
32:43
SPEAKER_05: I'm sorry to interrupt.
32:44
SPEAKER_08: No, that's perfect.
32:45
SPEAKER_08: Mark, I'm gonna come to you.
32:46
SPEAKER_08: Um, are all the good deals gone?
32:48
SPEAKER_08: Because I hear this.
32:49
SPEAKER_08: Juan, all the good deals are I should have bought 20 years ago.
32:53
SPEAKER_06: And uh are they all gone?
32:55
SPEAKER_06: All the good deals are there, and and I differ from Brian about the MLS.
33:00
SPEAKER_06: Okay.
33:02
SPEAKER_06: When you're a buyer, you gotta have a seller.
33:05
SPEAKER_06: But you can spend the entire day going up and down the street, knocking on doors, asking someone if they want to sell.
33:12
SPEAKER_06: No brokers, I got cash, you want to sell them?
33:14
SPEAKER_06: They're already living there, the kids there, they're school, they're close to work, they're not selling.
33:19
SPEAKER_06: Who's selling?
33:20
SPEAKER_06: The guys in the MLS, they're all selling.
33:22
SPEAKER_06: They all want to sell, that's why they're in the MLS.
33:25
SPEAKER_06: Now, right if they have a marks that don't have to be so, so, so maybe not at their price.
33:35
SPEAKER_06: Okay, so that's when you get creative offers.
33:39
SPEAKER_06: And you work with a broker that wants to do creative offers.
33:42
SPEAKER_06: Okay, some brokers go, oh, it's gonna sell for more than uh list price anyway.
33:46
SPEAKER_06: I wouldn't write that offer.
33:47
SPEAKER_06: It's ridiculous.
33:48
SPEAKER_06: Well, that broker you don't need to work with.
33:50
SPEAKER_06: Okay, if they don't have a tenant uh or a transaction coordinator that they can spin off and say, write this up for Jimmy, okay, then that's not the guy to work with, probably.
34:02
SPEAKER_06: Okay, you gotta put in some offers.
34:04
SPEAKER_06: When I look at uh and I since since college, I got addicted to the Wall Street, right?
34:11
SPEAKER_06: So even to this day, I read it every day.
34:13
SPEAKER_06: But when you see something that was listed for 17 million and sold for 7 million, okay, you think someone wrote a stupid offer and it got accepted because the guy the guy needed to sell that for some reason.
34:29
SPEAKER_06: Uh you know, uh was he in for closure?
34:32
SPEAKER_06: Did he have a divorce?
34:32
SPEAKER_06: Did he someone die?
34:34
SPEAKER_06: Oh, the the guys who buy the houses in 24 hours, all cash as is, they've now added to the inherit a house, don't know what to do with it, as a new tagline on their commercials, because you're already busy in your life and you're doing things and you live in the valley.
34:52
SPEAKER_06: And then the uncle dies in Laguna.
34:55
SPEAKER_06: What do you know about Laguna?
34:56
SPEAKER_06: You don't know anything about Laguna, you know, so maybe you just want to sell it off and get out from underneath it.
35:02
SPEAKER_06: Or maybe you have to go to a brother that you can't talk to.
35:04
SPEAKER_06: You just need to get rid of it.
35:05
SPEAKER_06: So there's a whole lot of ways to function these deals.
35:08
SPEAKER_06: They're all there.
35:10
SPEAKER_06: Sometimes you have to make them, but they're all there.
35:13
SPEAKER_06: And sometimes you have to walk away from them when they're not right.
35:17
SPEAKER_06: But I've had more many, I've had many, I should just say, instead of more than one, come back to me two weeks or a month later because what they thought was happening wasn't happening.
35:28
SPEAKER_06: And they come back, are you still real?
35:30
SPEAKER_06: Yeah, I'll close out in seven days all cash.
35:32
SPEAKER_06: I'll send you an astro.
35:34
SPEAKER_00: Juan, you know, one of the one of the things we talk about in good deals, um I had a theory on that, and it was I know I've made the right offer if they reject my first offer.
35:48
SPEAKER_00: If they accept my first offer, I go shit.
35:52
SPEAKER_00: I went I went too high.
35:54
SPEAKER_00: Yeah.
35:54
SPEAKER_00: I I and I don't I and you're right.
35:57
SPEAKER_00: You I you have to be able to work with brokers that are comfortable putting in a offer that's low.
36:04
SPEAKER_00: Some people, oh, I don't want to embarrass them, I don't want to upset them, I don't want to get them mad.
36:08
SPEAKER_00: Hey, it's your money.
36:10
SPEAKER_00: You know, it's not the broker's money, it's not the agent's money, it's not the seller's money, it's your money.
36:14
SPEAKER_00: So when you make an offer, don't be afraid to embarrass them with an offer.
36:18
SPEAKER_00: Because afterwards, if they take that first offer, you go, shit, did I offer too much?
36:24
SPEAKER_06: Exactly.
36:24
SPEAKER_06: And you know what?
36:25
SPEAKER_06: Uh oh, my buddy and I bought one that was listed for two million dollars.
36:31
SPEAKER_06: And over the course of the year, and the price reductions went down so far that it went for$75,000.
36:37
SPEAKER_06: Okay?
36:38
SPEAKER_06: $75,000.
36:39
SPEAKER_06: Now is it worthless?
36:40
SPEAKER_06: Yeah, it may not even be worth that.
36:42
SPEAKER_06: But the idea is whoever would have come out with the two million offer or the million and a half offer, or the million offer, would have been stupid because it wasn't worth that.
36:51
SPEAKER_06: No.
36:51
SPEAKER_06: Okay.
36:51
SPEAKER_08: I kept looking at it and looking at it.
36:53
SPEAKER_08: I've seen Mark um submit 10 offers in one day.
36:58
SPEAKER_08: Like a lot of offers.
36:59
SPEAKER_08: And he would have, you know, back when I was much younger, it was me and a few other brokers working with him, he'd have us write offers left and right, and he didn't care.
37:06
SPEAKER_08: And he's like, if they think I'm crazy, then so be it.
37:08
SPEAKER_08: And he says if you throw enough stuff against the wall, something's gonna stick.
37:11
SPEAKER_08: And Mark would would would get would get several that way, and he wasn't afraid uh to go out there and especially look, especially if a property's sitting on the market a long time, he's gonna be aggressive on price.
37:22
SPEAKER_08: And so, and so that's why, and I agree with Mark in terms of the MLS.
37:25
SPEAKER_08: Sometimes before they hit the MLS, I feel like the owner comes in at a very high price.
37:29
SPEAKER_08: And if you're on the market for six months, several price reductions, you realize the market doesn't believe in your value, now they're gonna hear a lower offer.
37:37
SPEAKER_08: So, so that's good.
37:38
SPEAKER_08: Um, I'll move on to Brad.
37:40
SPEAKER_08: Brad, so probably two questions.
37:42
SPEAKER_08: Um, you know, I keep introducing Brad as, oh, he went from zero to 250, and he just quietly said 400, right?
37:48
SPEAKER_08: So I mean I gotta I gotta change his bio that he went from zero to 400 doors.
37:52
SPEAKER_08: Um what's what's the end goal for for someone like you?
37:56
SPEAKER_08: And then also if you had say$200,000 today, uh, or if someone came to you and said, hey, I got$200,000, like what can I do that would be a smart play in real estate?
38:06
SPEAKER_01: Okay.
38:07
SPEAKER_01: Um well the initial goal was to generate enough passive income to quit my job.
38:14
SPEAKER_01: And I thought, oh, if I can make$5,000 a month, then I can quit my job, and then I could do, I can be a digital nomad, I could blog, you know, I don't know, I could do something else that would be fun, and then at least I'd have some income from my apartments.
38:29
SPEAKER_01: And then it just became so fun, you know.
38:33
SPEAKER_01: So when I hear, you know, Mark and everyone else talk, they're like, oh yeah, you know, we get excited about a hundred thousand dollar deal, five hundred thousand dollar deal, million-dollar deal.
38:45
SPEAKER_01: It's like it kind of sometimes it's just the price doesn't matter, it's just the art of the deal, and how do we put it together, and how do we, you know, the negotiation and what's the business plan and crafting that up and then executing on that, and then you're like, wow, it it worked, you know.
39:00
SPEAKER_01: I I think what when you do you have to get comfortable with taking risk, and so buying that first property, yeah, we can put money in the 10-year treasury and let it sit, but like there's no real risk that you're taking.
39:14
SPEAKER_01: So if you can take risk and quantify that risk and make a little extra return, yeah, it's gonna be more work on your end.
39:22
SPEAKER_01: You might have to spend some time learning how to paint or whatever value you're gonna bring to the process.
39:28
SPEAKER_01: But when you do, then you're like, oh, I can't accomplish something that was this unknown that I didn't know that I could potentially do.
39:39
SPEAKER_01: So uh when I buy today, it's along that process, you know.
39:43
SPEAKER_01: Like you get to a point where you scale big enough and you do enough volume where like if I could, I would buy every deal just with my own money, and then that that would be it.
39:53
SPEAKER_01: But when you scale big enough, you just you just you just can't do it.
39:58
SPEAKER_01: So you need to be able to raise money and go to trusted people.
40:02
SPEAKER_01: So when I raise money, yeah, um, you know, it might seem like, oh, this is a lot of work, or then I have to, you know, send reports to my investors and K1s and all these other items, but I you know, I have a process now, I have a team, I have other people to help me do it.
40:19
SPEAKER_01: I can't do it all on my own.
40:21
SPEAKER_01: And um I I the fun thing to grow is to see other people around me succeed.
40:29
SPEAKER_01: Okay, so uh Favi and Yvonne are in the back corner.
40:33
SPEAKER_01: I have wonderful stories.
40:34
SPEAKER_01: They were both tenants of mine who are now employees.
40:37
SPEAKER_01: Fabi uh I helped her family buy duplex off Anaheim and Gundry.
40:42
SPEAKER_08: Nice.
40:43
SPEAKER_01: Uh Yvonne quit on me after the first day of work, and I said, Yvonne, what are you doing?
40:48
SPEAKER_01: She's like, Oh, my English, and I'm concerned and I'm self-conscious.
40:51
SPEAKER_01: I'm like, don't worry.
40:53
SPEAKER_01: Like, we're gonna learn together.
40:55
SPEAKER_01: Uh, they both worked in the city of Long Beach, you know, in Long Beach.
41:00
SPEAKER_01: Uh Fabi worked at uh the Queen Mary, Yvonne, you know, worked at various different jobs, and so I said, you know what, just look, I if you try your hardest every day, how can I get mad at you?
41:12
SPEAKER_01: I know you're gonna make mistakes.
41:14
SPEAKER_01: I know we're gonna learn together, but if you just try your hardest every day, uh I like that's you like I'll always uh be you know reward you.
41:25
SPEAKER_01: I will be, you know, um you know faithful in the fact of like you'll always have a job with me.
41:33
SPEAKER_01: And so and now they both hold their real estate license.
41:37
SPEAKER_01: Um they have so many other accomplishments.
41:39
SPEAKER_01: So um so the I I guess it's fun to see people improve around me.
41:44
SPEAKER_01: Um I buy deals because it's just fun.
41:47
SPEAKER_01: So my end goal, you know, I don't know, I financially I've accomplished most all my goals.
41:53
SPEAKER_01: I, you know, do I need to make more money?
41:56
SPEAKER_01: I I I when I buy property, it's because it's fun.
42:00
SPEAKER_01: And then I'm gonna make money for myself, but also for my investors, and I do it for the challenge.
42:05
SPEAKER_01: If I had$200,000 today, um, you know, it just depends uh, you know, am I renting an apartment?
42:15
SPEAKER_01: Am I you know living in a single family home?
42:17
SPEAKER_01: I have to kind of evaluate that.
42:19
SPEAKER_01: But let's just say I didn't own any real estate and I had$200,000 today.
42:23
SPEAKER_01: Um my strategy was right to build uh passive income, five grand a month.
42:29
SPEAKER_01: So um I would likely buy like a duplex or a triplex, you know, somewhere.
42:36
SPEAKER_01: Um I you know, I was always hyper focused on cash flow.
42:39
SPEAKER_01: So that and so we're buying for cash flow, then I'm gonna have to probably go in a slightly less desirable area.
42:46
SPEAKER_01: But, you know, you know, in let's take Long Reach for example, instead of buying a duplex or triplex on First Street and the Bispo, maybe I buy on six in the Bispo.
42:59
SPEAKER_01: And I could probably get a slightly better price, and uh I could buy a duplex or triplex, I could rent out a couple units and live um in the front house or something.
43:09
SPEAKER_01: You like when I look back to my memories as a kid, you know, it was never like, oh, I wish I had another bedroom or I shared a bedroom with my sister.
43:19
SPEAKER_01: Oh, I wish I, you know, had like this other toy or something.
43:24
SPEAKER_01: Yeah, maybe you you talked about it, but you as a kid you quickly forget about it.
43:28
SPEAKER_01: I'm just thinking, if you have a family and you're worried, oh, you know, I'm gonna live in a duplex or triplex, what are my friends gonna say?
43:36
SPEAKER_01: You know, like they're gonna come over, like, oh, you know, that's Sally, she lives in the back, she's a really nice person, she's a teacher in Long Beach and she's renting an apartment for me.
43:45
SPEAKER_01: I to me, I embrace that and I go, wow, what a smart decision.
43:49
SPEAKER_01: Like, what when's like what's when's the next deal?
43:52
SPEAKER_01: You know, like what are you working on?
43:54
SPEAKER_01: And I'm always kind of challenging myself and my friends or the you know, my uh fat.
44:00
SPEAKER_01: And Evolin, like, hey, what's the next deal?
44:02
SPEAKER_01: What are we working on next?
44:03
SPEAKER_01: You know, like Fabi, I know you have a place for your family.
44:06
SPEAKER_01: Let's buy one for you.
44:07
SPEAKER_01: Evolum, let's go.
44:08
SPEAKER_01: Like, when's the next property that we're gonna buy?
44:11
SPEAKER_01: So um I I'd say yeah, five, two hundred grand, that that's probably something I look for.
44:16
SPEAKER_01: Um otherwise, uh I I'm yeah, I I think cash flow early on in your in your um you know, building a portfolio is really important.
44:25
SPEAKER_01: So otherwise I would take that 200,000 and look for something that could potentially generate, you know, better cash flow.
44:32
SPEAKER_01: And maybe if it wasn't day one, it was a little bit over, it was over time, raising rents, or I had to have some way to get to the cash flow.
44:41
SPEAKER_01: Maybe it's not day one, maybe it's in a year or two years, but something that I I think I could obtain.
44:47
SPEAKER_08: Yeah, that's awesome.
44:49
SPEAKER_08: Um, I'm gonna open up the questions to you guys, but before we do, uh Sam, do we want them to use the mic?
44:54
SPEAKER_08: Is that what we want, or just a little thing?
44:56
SPEAKER_08: Yes.
44:57
SPEAKER_08: Okay, cool.
44:58
SPEAKER_08: Um, Jack, or can you help?
45:01
SPEAKER_08: It's you gotta just hold this so that we can hear it from the from the video.
45:06
SPEAKER_08: Um and I just want to say, because I personally know all of them, I know a lot of times when we're we're just getting started, it's it's frustrating, things seem expensive, or how can I ever do it?
45:16
SPEAKER_08: Um, you know, they figured out a way, and and I know all of them, so none of them, I mean, Brad's dad was a teacher, right?
45:23
SPEAKER_08: So it wasn't like, and then I know everyone's background, no one was like handed uh, hey, here's your first eight-unit building, but you know, thanks for being in our family.
45:31
SPEAKER_08: That was not the case.
45:33
SPEAKER_08: They all found a way to do it, and so part of having mirrors to let you know, uh, because I because I hear a lot of things from people who reach out to me like, hey, it's just it's not for me.
45:42
SPEAKER_08: I can never do it.
45:43
SPEAKER_08: I'm like, why do you say that?
45:45
SPEAKER_08: Because I see so many people around us do it, and people that maybe with less needs, and so uh, you know, I respect and look up to all of them.
45:52
SPEAKER_08: Um, if someone has a question, we'll we'll open it up to you guys.
45:55
SPEAKER_08: I know Urban was the first one, and so um, and you know, you could ask to everybody or ask someone specifically, it's fine, you guys decide.
46:03
SPEAKER_04: Yeah, I had a question for Mark.
46:05
SPEAKER_04: I mean you brought up the ADU, buying one and two in the back, and um excluding uh well, Juan says, but a lot of people on social media that we follow, I'll say you can you can do this and it'll take you three months.
46:21
SPEAKER_04: So if you were to buy and you add how what's the realistic time frame with permits, do you get it, do you go to the same contract, do you go to the city's pre-design just to give a realistic timeline?
46:31
SPEAKER_04: Because a lot, there's a lot of misinformation out there with buyers or first-time investors that I run into.
46:36
SPEAKER_04: And excluding stage the other agents or influencers give them really misinformation.
46:43
SPEAKER_04: And then they get stuck into something and it ends up costing them more money, doesn't give me the right.
46:47
SPEAKER_04: So what's a what's realistic if you were to do that ADU play?
46:51
SPEAKER_08: Well, uh, so just how many ADUs have you built?
46:53
SPEAKER_08: And then now, how long is it taking you to do?
46:56
SPEAKER_08: 24 or 25?
46:58
SPEAKER_08: Okay, so there you go.
46:59
SPEAKER_08: So he's bringing housing to Long Beach, so thank you.
47:01
SPEAKER_08: But housing provider, that's it, yes.
47:04
SPEAKER_08: No longer landlord.
47:05
SPEAKER_08: Thank you.
47:06
SPEAKER_08: Thank you for signing on.
47:08
SPEAKER_06: It depends where you work.
47:10
SPEAKER_06: If you work in some cities, for example, let's say Norwalk and Whittier, which are great cities because they're older and their lots are gigantic, okay?
47:21
SPEAKER_06: So there's some magic in that versus uh Irvine, where it's so new that you can't even put a car on the driveway because the driveways are so short.
47:31
SPEAKER_06: Okay?
47:31
SPEAKER_06: So if you get into those cities and you find that they have a professional city government where they take your application over the counter and send it immediately out to a professional company that's contracted with the city to do the corrections and get you back your plans.
47:54
SPEAKER_06: Very short.
47:55
SPEAKER_06: You can probably have your permit and your permit to build in six weeks, eight weeks.
48:00
SPEAKER_06: If you come to Long Beach, the city that says that they're business friendly, you run into a quagmire of stuff.
48:09
SPEAKER_06: Okay?
48:10
SPEAKER_06: However, uh we've got great rents and we've got great weather, and we have so many neat infrastructural things because we're a city of over half a million people.
48:20
SPEAKER_06: And so it depends what you're doing.
48:22
SPEAKER_06: But in Long Beach, start to finish uh nine months, uh, you can get hung up in permits.
48:29
SPEAKER_06: I've got one property on Redondo where the city can't decide if it's commercial or residential.
48:37
SPEAKER_06: Commercial meaning residential with three or more units or four or more units.
48:42
SPEAKER_06: Uh, if you've got an eight-unit building, you don't get a residential inspector, you get a commercial inspector.
48:47
SPEAKER_06: So I've got sometimes, and they decide this, and then they decide it again, and then they decide it again.
48:55
SPEAKER_06: And so it's a you you have to come at this with patience.
48:59
SPEAKER_06: You have to come at it with patience.
49:01
SPEAKER_06: Uh will it be cost overruns?
49:03
SPEAKER_06: Yeah, always.
49:04
SPEAKER_06: Okay, everything has cost overruns.
49:06
SPEAKER_06: You never know your total costs in the beginning, okay?
49:09
SPEAKER_06: You don't know until it's all over.
49:13
SPEAKER_06: However, what I can tell you is this when you buy a simple track home anywhere in Long Beach, it's gonna cost you a million dollars.
49:23
SPEAKER_06: Give or take, a million dollars.
49:25
SPEAKER_06: It's gonna be 1,200 square feet.
49:27
SPEAKER_06: Gonna be built in the 50s, maybe 40s or earlier, but 40s or 50s.
49:32
SPEAKER_06: So if it's 1,200 square feet and you can build it new today, let's say 200 bucks a foot.
49:38
SPEAKER_06: That's$240,000.
49:41
SPEAKER_06: So it's just$200 a foot times the$1,200 square feet.
49:44
SPEAKER_06: $240.
49:45
SPEAKER_06: That's what it's worth,$240,000.
49:47
SPEAKER_06: But wait, you just paid a million for it.
49:50
SPEAKER_06: What's that mean?
49:52
SPEAKER_06: It means that your structure on your dirt, if we were new, is worth$250,000,$240,000.
50:01
SPEAKER_06: That means your dirt is worth$750,000.
50:06
SPEAKER_06: The dirt's worth$750,000.
50:08
SPEAKER_06: So if the dirt is big enough to put another house in, and that other house costs you$250,000.
50:17
SPEAKER_06: It doesn't matter because you have no land cost.
50:20
SPEAKER_06: It's already in the mortgage of your first house.
50:23
SPEAKER_06: So it has to be positive cash flow.
50:26
SPEAKER_06: The ADU or the SB9 that you add to it will immediately make you profits in excess of your costs because you have no land, which, as we just explained, is usually three or four times the value of the building that's on the land.
50:43
SPEAKER_08: So well, thank you.
50:44
SPEAKER_08: Another question?
50:46
SPEAKER_08: There's no such thing as a back question, too.
50:48
SPEAKER_08: If there's something, anything that it could be, and it could be at the beginner level, advanced level, we don't care.
50:52
SPEAKER_08: Go ahead.
50:53
SPEAKER_08: Beginner level.
50:54
SPEAKER_08: Okay.
50:54
SPEAKER_08: That wasn't looking at you when I said beginner there.
50:57
SPEAKER_08: You're not a beginner.
50:57
SPEAKER_08: Come on.
50:58
SPEAKER_07: Um, the first question is actually for you, Juan.
51:00
SPEAKER_07: So will you help me write those stupid deals?
51:04
SPEAKER_08: Oh, see, yeah.
51:05
SPEAKER_08: Uh there's there's two.
51:07
SPEAKER_07: I'm I'm it it um it depends, is gonna be the question.
51:10
SPEAKER_07: There's two four units that mirror mine in Gardena in like a really good spot, but they've been on the market for like eight months, and I know why.
51:18
SPEAKER_07: Okay.
51:19
SPEAKER_07: Um, it's just way overpriced.
51:20
SPEAKER_07: That's still in problem.
51:21
SPEAKER_08: Let's let's talk, let's let's talk and we'll see.
51:24
SPEAKER_08: I mean, I I think with with me, you know, I don't want to rush and say, yes, I'll do it.
51:28
SPEAKER_08: Um I think within reason, if there's if I could support a lower value, then absolutely, right?
51:34
SPEAKER_08: Because Mark showed me how to support lower values.
51:37
SPEAKER_08: He showed me.
51:37
SPEAKER_08: So for years I worked for the 18 years as his right-hand man.
51:40
SPEAKER_08: So he I learned how to analyze a property.
51:42
SPEAKER_08: If I could support it, then we could go argue for it.
51:45
SPEAKER_08: If I'm just picking a random low ball loaner, I don't think.
51:48
SPEAKER_08: I would offer that to you guys.
51:49
SPEAKER_08: Yeah, no, but that's a good reputation against it.
51:51
SPEAKER_08: And thank you for considering us.
51:52
SPEAKER_08: I appreciate it.
51:52
SPEAKER_08: Oh, yeah.
51:53
SPEAKER_07: Um, the second one, Brian.
51:55
SPEAKER_07: Um uh Brian, he's been my mentor forever.
51:57
SPEAKER_07: Actually, like when if I go back to my emails, my first one was I'm about to leave for boot camp.
52:02
SPEAKER_07: Will you meet up with me so we can talk about realistic?
52:04
SPEAKER_07: Oh, that's right.
52:05
SPEAKER_07: That was in 2018.
52:06
SPEAKER_07: That's awesome.
52:07
SPEAKER_07: So um, and then when I came back that, yeah, we actually met up and he uh helped me get into my first four unit.
52:13
SPEAKER_07: We did everything he said, cruised the neighborhood, hung out there at night, moved into the worst unit possible, remodeled it.
52:19
SPEAKER_07: So this cash flowing now is pretty cool.
52:21
SPEAKER_07: When it wasn't cash flowing in the beginning, I was like, oh crap, what are we gonna do?
52:24
SPEAKER_07: Yeah, um my question is so we have a low interest rate on that property is cash flowing.
52:30
SPEAKER_07: We fixed up three of the four units.
52:31
SPEAKER_07: We have one uh tenant we inherited with uh low rent.
52:36
SPEAKER_07: Um we're just gonna leave him there.
52:38
SPEAKER_07: Um but uh so yeah, we have all this equity in it, and we have equity in a single family home.
52:45
SPEAKER_07: What's our next move?
52:47
SPEAKER_07: Because I'm just tied up in all our cash is just locked in there.
52:50
SPEAKER_08: Thank you for asking me the easy question.
52:52
SPEAKER_08: That's that's good.
52:54
SPEAKER_08: What's his next move, Brian?
52:55
SPEAKER_08: Let him know, please.
52:56
SPEAKER_05: You clearly know the answer.
52:59
SPEAKER_05: And you know what?
53:00
SPEAKER_05: Um, I appreciate working with Eric.
53:03
SPEAKER_05: I got a call from my nephew saying, hey, can you do me a favor?
53:07
SPEAKER_05: And of course.
53:08
SPEAKER_05: And so I contacted uh Eric, and uh, you know, we've been communicating a lot.
53:15
SPEAKER_05: And him and his wife were scared.
53:18
SPEAKER_05: Um, I think it was even before your baby was born.
53:22
SPEAKER_05: It was like, what do we do?
53:24
SPEAKER_05: But he took the risk, and it wasn't it wasn't roses, it was it was a lot of hard work and uh emotion that he put into it.
53:37
SPEAKER_05: But now he's got are you referring to the building where your mom lives currently?
53:42
SPEAKER_05: Yeah, yeah.
53:46
SPEAKER_05: Yeah.
53:46
SPEAKER_05: We didn't raise her rent, didn't we?
53:49
SPEAKER_05: You raised her rent, paying the cents, market rent, market rent.
53:54
SPEAKER_05: Yeah.
53:55
SPEAKER_05: Um but he he really worked hard and he did a lot of the work himself, along with one of your friends, who is a contractor, who I think we spend a little time with too.
54:07
SPEAKER_05: But you know, he's he's the the poster child, if you will, of making it work starting.
54:16
SPEAKER_05: You know, it's never gonna pencil out, you're never gonna be a billionaire on your first deal ever.
54:23
SPEAKER_05: But unless you get in the game, you're gonna lose, period.
54:27
SPEAKER_05: You know, um, I always tell everybody do you know anybody that says, I wish I wouldn't have bought that first house?
54:34
SPEAKER_03: Does anybody Yeah, the condo agreement double rating with a bass mortgage extra one guy?
54:42
SPEAKER_05: Okay, one.
54:43
SPEAKER_05: Has anybody heard the story of I wish I would have bought two of them?
54:46
SPEAKER_05: I I should have, I should have slept in the uh living room and bought two of them.
54:51
SPEAKER_05: You know, that's just and Eric has really um stepped up and now he's got another uh single family residence that I believe he moved into, right?
55:02
SPEAKER_05: Uh and that was another thing that I always encourage be close to your family, right?
55:12
SPEAKER_05: And if somebody in the family is gonna sell something, well you want to be there.
55:19
SPEAKER_05: You know, you want to say, okay, can I be involved in that family uh transaction?
55:23
SPEAKER_05: And and that's what you did.
55:25
SPEAKER_05: And it's getting better and better.
55:28
SPEAKER_05: And I you're probably sleeping what one day a week now?
55:31
SPEAKER_05: Uh well, you had a baby too.
55:35
SPEAKER_05: A wife and the baby, and now uh, but eventually you see the light, and hopefully, when you see the light, you decide, you know what, I need another fourplex.
55:47
SPEAKER_05: You know, I need to refinance the house that I just paid off.
55:53
SPEAKER_05: Right?
55:55
SPEAKER_05: And just keep on going.
55:57
SPEAKER_05: You know, don't ever look back because as you get bigger and bigger, those negative cash flows become smaller and smaller because you have so many properties that you can leverage off of.
56:10
SPEAKER_05: So, you know, I admire what you did and uh great job.
56:15
SPEAKER_05: And he's got a great family too.
56:16
SPEAKER_05: That's the number one thing.
56:18
SPEAKER_05: Awesome.
56:19
SPEAKER_00: It's all worked out.
56:20
SPEAKER_00: You know, one one one of the things I I I tell a lot of young people that work for me, they're thinking about buying either an investment property or their first home.
56:29
SPEAKER_00: And and and I tell this to people that I know, family members that just focus focus on two things.
56:37
SPEAKER_00: Focus on the location and focus on the price.
56:40
SPEAKER_00: Because I can change anything else.
56:42
SPEAKER_00: I can level it.
56:43
SPEAKER_00: I own the I have the land, I may not like the way it looks, I can change the carpet, I can change the paint, I can change structure.
56:49
SPEAKER_00: Maybe sometimes it may not make financial sense, but I can never change the price that I paid for it, and I can never change the location.
56:57
SPEAKER_00: So if you don't like those two things, think about what you're gonna do.
57:01
SPEAKER_00: Everything else you can change with within real estate.
57:04
SPEAKER_06: Always the best deal is one when you say, oh, you bought that eight years ago or ten years ago.
57:09
SPEAKER_06: I never hear anyone saying, I bought that ten years ago, and I wish I wouldn't have.
57:14
SPEAKER_06: No, we just heard it.
57:16
SPEAKER_06: One person, one person.
57:18
SPEAKER_06: Okay, but but but it's because you just have the appreciation.
57:21
SPEAKER_06: That's your that's your natural edge for inflation, is appreciation.
57:25
SPEAKER_06: And so as long as you have that going on, and when you're talking about cash flows, cash we're talking all the time, what's not counted in that oh, I'm making five percent, I'm making six percent, I'm making three percent.
57:38
SPEAKER_06: But your property is going up at eight or twelve percent per year.
57:42
SPEAKER_06: So you still have that at a certain level.
57:45
SPEAKER_06: Your properties are going up, your portfolio is going up millions of dollars a year.
57:51
SPEAKER_06: You don't necessarily have any extra cash.
57:54
SPEAKER_06: You don't, there are no Ferrari in the driveway, perhaps.
57:58
SPEAKER_06: But the idea is that that appreciation in your portfolio keeps going up.
58:03
SPEAKER_00: Well, you know, it's it it's it and you're right.
58:06
SPEAKER_00: You're not you there's not a bunch of extra cash because what you're really gonna become is you're gonna become cash poor.
58:12
SPEAKER_00: I mean you have everything invested in in real estate.
58:16
SPEAKER_00: You keep putting it back in real estate like it, it's like, you know, we're talking about all other alternatives of investments, and obviously the last six, seven years, the stock market's gone crazy, you know, and and uh investors have that.
58:30
SPEAKER_00: You try to source investors for your syndication, they're looking at shit, I can invest in the stock market.
58:33
SPEAKER_00: I look at NVIDIA every single day, or Google, or Amazon, or whatever.
58:38
SPEAKER_00: The big difference that a lot of you guys don't realize is you get to leverage real estate.
58:42
SPEAKER_00: You want a million dollars in real estate, you have a hundred thousand dollars or two hundred thousand dollars, you get a million dollars for the real estate.
58:47
SPEAKER_00: You want a million dollars in the stock market, more than likely you've got to have a million dollars in cash that to have to invest it and work for it.
58:53
SPEAKER_00: Brad, you were gonna say something.
58:54
SPEAKER_01: Um I don't know.
58:56
SPEAKER_01: A lot of it, yeah, like you look at the stock market, I think it's doubled over the last like four or five years or so.
59:01
SPEAKER_01: So yeah, when I go and talk to people, even my own brother, I'm like, hey, this is a really good deal.
59:05
SPEAKER_01: He goes, Brad, my money has doubled over the last four or five years.
59:10
SPEAKER_01: Why would I buy that?
59:11
SPEAKER_01: I go, well, I don't know, is it gonna double again in the next four or five years?
59:15
SPEAKER_01: Are you, you know, what like I can look at long-term averages of real estate making you 10, 11%, but like it doesn't what happened in the past doesn't always mean it's gonna happen in the future.
59:26
SPEAKER_01: I think of uh building that ADU in your backyard, you know, 240,000.
59:33
SPEAKER_01: You know, if you can, you know, we're gonna look at the numbers too.
59:36
SPEAKER_01: If you can charge two grand a month in rent, you're gonna make 24,000 a year.
59:41
SPEAKER_01: He's gonna make a 10% return on his money, right?
59:43
SPEAKER_01: And uh cash on cash return plus the what's imputed in there is value that the property is worth more, right?
59:52
SPEAKER_01: So maybe that increased the value of the property$500,000, let's say.
59:57
SPEAKER_01: So not only is he generating a 10% cash on cash return, but also he increased the value of the property an extra$500,000.
1:00:05
SPEAKER_01: Okay.
1:00:06
SPEAKER_01: Um, I think of the direct answer to your question, like, oh, if I had a lot of equity tied up, I I you you know, there's other vehicles like potentially looking at a line of credit or something, and that way you maintain the first, right?
1:00:19
SPEAKER_01: Your fixed rate mortgage that's low, and then you open up, let's say, half a million bucks or whatever, a couple hundred thousand as a line of credit that maybe if you find the right thing, you can draw on, but you're gonna keep um continue to keep your fixed rate mortgage.
1:00:34
SPEAKER_01: You know, I I like to leverage, I feel, you know, sometimes I sit down and I'm like, gosh, I'm so poor, you know, because I continue to reinvest my money, and that's so fun and it brings so much joy to me.
1:00:47
SPEAKER_01: But when you do it for you, you create this habit, and you do it one year and two years and five years and ten years, then you're like, you know, instead of investing$500 a month, you're investing a thousand dollars a month and then two thousand dollars a month, and it just becomes a habit.
1:01:04
SPEAKER_01: I I'm I like to build things, I like to see things grow.
1:01:08
SPEAKER_01: And so when you can look back and go, oh, I remember, I can go back to old financial spreadsheets I had, you know, 15 years ago and go, oh man, I remember I would get excited if I could save$400 a month and you know, sell something, consolidate something, reduce my expenses, increase my cash flow, then I could go and figure out how to invest that.
1:01:31
SPEAKER_01: So yeah.
1:01:33
SPEAKER_03: Mr.
1:01:33
SPEAKER_03: Bieler, yes.
1:01:35
SPEAKER_03: Thank you for uh bringing me uh a loan deal.
1:01:37
SPEAKER_03: I was a lender for 30 years, and now I've heard the other side, real estate, but thanks for the deals I met you many decades ago, or a few decades ago, I think.
1:01:46
SPEAKER_03: And you've got brain trust here.
1:01:47
SPEAKER_03: I have a question that throw it out to anybody.
1:01:50
SPEAKER_03: Uh 10 days, uh ADU uh triplex.
1:01:55
SPEAKER_03: It could be an ADU very ancient today almost to be an ADU triplex.
1:01:59
SPEAKER_03: One was done up the street, two doors up the street temp and days.
1:02:04
SPEAKER_03: Is that attractive to ADU uh guys, or is it too far out on the red spectrum?
1:02:11
SPEAKER_03: The rents are not going to be as high as you would get down here or the shore, etc.
1:02:15
SPEAKER_03: What do you think of 10th and days?
1:02:18
SPEAKER_06: What do you think of 10th and daisy?
1:02:20
SPEAKER_06: For me, uh I've decided, and this came 15 years ago maybe, that instead of having a hundred doors at 91 Freeway and Lakewood Boulevard, I would rather have eight doors on First Street.
1:02:36
SPEAKER_06: Yeah.
1:02:36
SPEAKER_06: Just it's just a thing.
1:02:38
SPEAKER_06: A, you have a distance.
1:02:41
SPEAKER_06: The other thing is let's say the rent is$1,600 a month out there.
1:02:52
SPEAKER_06: That lady who's raising the two kids, okay, her take-home pay is$2,300 or$2,500.
1:03:00
SPEAKER_06: Sure.
1:03:01
SPEAKER_06: And she's paying it all in rent.
1:03:03
SPEAKER_06: And there's always going to be a collection problem.
1:03:08
SPEAKER_06: So your lost reserves might be at, let's say, six or seven percent, maybe, depending on the market.
1:03:15
SPEAKER_06: Where you get the guy on First Street who pays$7,500 a month in rent, okay, and he's paying 20% of his take-home pay.
1:03:27
SPEAKER_06: So your rent is always paid a day before the first.
1:03:32
SPEAKER_06: Okay?
1:03:33
SPEAKER_06: So it just depends on where you're on your cycle.
1:03:36
SPEAKER_06: When I started, everything was over there.
1:03:40
SPEAKER_06: Because that's where it was affordable.
1:03:42
SPEAKER_06: And that's where my meager money was.
1:03:45
SPEAKER_06: Okay, yeah.
1:03:46
SPEAKER_06: You know, you start thinking uh the other side of Cherry, you start thinking the other side of Atlantic.
1:03:51
SPEAKER_06: Uh, I did a whole bunch of stuff.
1:03:53
SPEAKER_06: And and my forte at that time was buying five and six-unit buildings and turning them into fourplexes.
1:03:59
SPEAKER_06: Because when I turned it to a four-plex, it was worth three times as much okay, and that's because it was financing for someone to take me out, okay, at the end of my of my rehab.
1:04:10
SPEAKER_06: When that market died, you have to find something else.
1:04:12
SPEAKER_06: Like I said in the beginning, the the market's always changing.
1:04:14
SPEAKER_06: You gotta find out what that what the market wants, and and currently it's uh more housing.
1:04:20
SPEAKER_03: Does anybody want Tenth and Daisy?
1:04:22
SPEAKER_03: That could be easily a five plexus now.
1:04:24
SPEAKER_08: This is this is good.
1:04:25
SPEAKER_08: He's opening up a deal making forum on the spot.
1:04:28
SPEAKER_08: I appreciate it.
1:04:29
SPEAKER_08: Talk to him on the way out, okay?
1:04:30
SPEAKER_08: That's good.
1:04:31
SPEAKER_08: Yeah, let's do one last question because I want to be cognizant of the time.
1:04:33
SPEAKER_08: Angelo, you get the last say.
1:04:35
SPEAKER_08: Uh, here we're gonna pass this mic to you real quick.
1:04:37
SPEAKER_08: This will be the last question, guys, because I I want to be respectful of the time.
1:04:41
SPEAKER_02: Um I think I had seen you before at the Knolls, right?
1:04:46
SPEAKER_02: Was that him?
1:04:47
SPEAKER_02: That was Carlos.
1:04:48
SPEAKER_02: Okay, yeah.
1:04:48
SPEAKER_02: I I I was curious of like how you crossed over from rental investing into your first franchise.
1:04:54
SPEAKER_02: So if you could just briefly tell me why you did that and how you got into that.
1:04:59
SPEAKER_08: And didn't it go the other way around?
1:05:00
SPEAKER_00: Franchise then rental?
1:05:02
SPEAKER_00: No, no, no, no.
1:05:03
SPEAKER_00: I I had a whole career in the beverage industry.
1:05:06
SPEAKER_00: Uh I I worked for Miller Brewing Company right out of college, uh, then ran a couple of beer distributors, family-owned distributors here in Los Angeles.
1:05:14
SPEAKER_00: Uh my wife worked for Miller Brewing Company also.
1:05:18
SPEAKER_00: And then um kind of at some point I I started thinking I gotta have a second act.
1:05:27
SPEAKER_00: And I got into franchising.
1:05:30
SPEAKER_00: I uh did a Jersey Mike's with a buddy of mine, and the next thing you know, we had 32 of them.
1:05:37
SPEAKER_00: Like in six years, we built one every other month for six straight years, and we expanded really, really quickly.
1:05:45
SPEAKER_00: And at the time, Jersey Mics had 500 stores across the country.
1:05:49
SPEAKER_00: They have 3300 now.
1:05:51
SPEAKER_00: We were really fortunate to get the right partner because when you go into franchising, I tell people all the time and I know we're not here to talk about.
1:06:00
SPEAKER_00: Franchising, but uh it's a little bit of what Brian says: pick the right person that you're gonna partner with because when you're exploring franchising, it's like when you're dating.
1:06:11
SPEAKER_00: My wife and I didn't get married after one date.
1:06:14
SPEAKER_00: You shouldn't sign up for a franchise after one date.
1:06:17
SPEAKER_00: They're trying to find out if you're right for them and if you're right for if they're right for you.
1:06:22
SPEAKER_00: And uh I was really fortunate uh to partner with Jersey Mikes.
1:06:26
SPEAKER_00: We own 21 down here in Southern California, two under development, uh five up in Northern California, eight more under development up there.
1:06:39
SPEAKER_00: Uh it's it it it started as a hobby and quickly became a second full-time job.
1:06:45
SPEAKER_00: Uh and but it's uh it's been great.
1:06:49
SPEAKER_00: It's it's it's uh uh a business that uh I had no had no food experience, but I I did have a lot of business experience.
1:06:59
SPEAKER_00: And I was telling somebody I can't earlier they were asking me about franchising, and it and and I always tell people if you have five or less, you've bought yourself a job.
1:07:10
SPEAKER_00: And that's okay.
1:07:11
SPEAKER_00: I don't, I don't, it's not with any disrespect to anybody.
1:07:15
SPEAKER_00: A lot of people, mid-career, they say, I get tired of working for somebody else, I can go work for myself.
1:07:19
SPEAKER_00: They get four or five of whatever, and they got a job.
1:07:22
SPEAKER_00: I never wanted to buy a job.
1:07:23
SPEAKER_00: My goal was to create a business.
1:07:25
SPEAKER_00: So that's why I had to scale up.
1:07:28
SPEAKER_00: And, you know, we have an office, we we have a whole staff, you know, a business is where you can leave for a month or two and come back and it's still running, it's still operational.
1:07:38
SPEAKER_00: You know, under under a couple, under five units, something breaks, someone calls in sick, you're the guy going in Sunday morning to take care of that stuff.
1:07:47
SPEAKER_08: Victor, can you tell everybody the newest franchise that you're starting that you've told me about is going to be near the track circle?
1:07:53
SPEAKER_00: Yeah, I um I'm like a lot of these guys, you got a lot of energy all the time, you get and you get bored if you're not doing something.
1:08:03
SPEAKER_00: And and I I had a young guy, uh not a young guy, when I was young, I had a boss, one of my first bosses, told me, Victor, the key to retirement is to retire to something, not from something.
1:08:14
SPEAKER_00: Sit at home and do nothing is is is not an option.
1:08:18
SPEAKER_00: So I I I became the um I'm the first franchisee for a brand that probably nobody here has ever heard of.
1:08:24
SPEAKER_00: It's called Mike's Red Tacos.
1:08:26
SPEAKER_00: They're out of San Diego.
1:08:28
SPEAKER_00: They have three stores down in San Diego.
1:08:30
SPEAKER_00: Uh they specialize in in a product called BDA.
1:08:33
SPEAKER_00: And some of you guys may know what Bedia is.
1:08:36
SPEAKER_00: There's nobody doing it at any scale nationally at uh at a big in big big like that.
1:08:44
SPEAKER_00: They're backed by the guys that uh started Dave's Hot Chicken, Wetzel's Pretzels, and Blazed Pizza.
1:08:51
SPEAKER_00: Uh and I signed a contract uh probably six months ago to build 18 of those.
1:08:57
SPEAKER_00: Uh 10 in LA County and eight of them in Orange County, and I'm overlaying them.
1:09:03
SPEAKER_00: You know, it's gonna sound crazy, but I'm I'm trying to simplify my life at this age.
1:09:08
SPEAKER_00: And why would you build 18 more restaurants?
1:09:10
SPEAKER_00: But I am overlaying it on top of the footprint where my jersey mics are.
1:09:14
SPEAKER_00: So I'm not like trying to go to a different territory and it's make my life harder like that.
1:09:18
SPEAKER_00: I already have the infrastructure, I have the office, I have the repair and maintenance people.
1:09:23
SPEAKER_00: So just trying to, you know, very similar to you, you got the land already, just do something with it.
1:09:28
SPEAKER_00: That's good.
1:09:28
SPEAKER_00: I don't know if that answered your question or cool.
1:09:31
SPEAKER_08: Um, so so two things.
1:09:33
SPEAKER_08: One, thank you guys for being here.
1:09:35
SPEAKER_08: Uh, my shameless request uh would be if you enjoyed today, leave me a Google review because that helps my business so much.
1:09:43
SPEAKER_08: And I wanted to have the QR code, but that we had no room in today.
1:09:47
SPEAKER_08: Um and I just want to let all the panelists, well, I want to thank them for being here today.
1:09:50
SPEAKER_08: I appreciate them a lot.
1:09:51
SPEAKER_08: But I I want everyone, I want to give you the final say, whatever that might be.
1:09:55
SPEAKER_08: Brad, we'll start with you.
1:09:58
SPEAKER_01: The final say, um you know, uh it's okay to be uncomfortable.
1:10:05
SPEAKER_01: I always say that.
1:10:06
SPEAKER_01: It's like embrace being uncomfortable if you're evaluating buying your first property or or going from apartments to mix mixed use or looking at a different product type.
1:10:20
SPEAKER_01: You know, work with a professional to help you quantify your risk and understand, talk to people who have maybe done what you're thinking about doing to understand maybe the level of commitment, you know, get references on whoever you decide to partner with or work with.
1:10:39
SPEAKER_01: Um, and at some point, yeah, you I mean, you gotta take a little bit of risk, but help, you know, do your best to quantify that.
1:10:48
SPEAKER_01: There's always gonna be unknown things that come up.
1:10:51
SPEAKER_01: Every property, every venture we do, there's always factors that come up that we don't know about.
1:10:57
SPEAKER_01: Different, you know, codes change, things change in the market, interest rates change.
1:11:03
SPEAKER_01: So, but at the end, we kind of we know, you know, to the best of our knowledge, what kind of risks, what venture we're getting ourselves into, who we're working with.
1:11:13
SPEAKER_01: And you know, don't make the same mistake make the same mistake twice.
1:11:17
SPEAKER_01: You're always going to make mistakes.
1:11:18
SPEAKER_01: It's how you learn, you create a better process, and how you adapt to those mistakes that you made.
1:11:26
SPEAKER_01: So, you know, I I'm a big, big proponent of being an entrepreneur, doing something entrepreneurial.
1:11:34
SPEAKER_01: You think there's three ways to do something?
1:11:36
SPEAKER_01: There's a thousand ways.
1:11:38
SPEAKER_01: There's a million ways to do something.
1:11:40
SPEAKER_01: A million ways to skin a cat, they say.
1:11:42
SPEAKER_01: That property, it's two units.
1:11:44
SPEAKER_01: Can it be three?
1:11:45
SPEAKER_01: Can you convert the garage to make it four?
1:11:47
SPEAKER_01: You know, can you scrape it and build something bigger?
1:11:50
SPEAKER_01: There's so many different ways.
1:11:52
SPEAKER_01: Can you rent it out as an Airbnb?
1:11:54
SPEAKER_01: You know, the the plethora of opportunities today are out there.
1:11:58
SPEAKER_01: You need to work hard, spend time, learn, be patient, be diligent in your process.
1:12:04
SPEAKER_01: Yeah, that would that would be my thing.
1:12:06
SPEAKER_06: Thanks, Brad.
1:12:07
SPEAKER_06: If I could plagiarize two paragraphs, I would say what he said, and let me just add this following thing.
1:12:17
SPEAKER_06: Pull the trigger.
1:12:19
SPEAKER_06: No analysis paralysis.
1:12:22
SPEAKER_06: One of my dearest friends thinks things through for years, doesn't lose anything, doesn't gain the same.
1:12:32
SPEAKER_06: Pull the trigger.
1:12:34
SPEAKER_05: Awesome.
1:12:35
SPEAKER_05: Thank you, Mark.
1:12:36
SPEAKER_05: Ryan.
1:12:37
SPEAKER_05: This is pretty good advice.
1:12:38
SPEAKER_05: These guys are geniuses, they really are.
1:12:41
SPEAKER_05: And I I couldn't agree anymore.
1:12:44
SPEAKER_05: Um I've met them through coffee.
1:12:48
SPEAKER_05: Okay.
1:12:49
SPEAKER_05: That's how every single one of us uh one introduced me to Mark, but then shortly thereafter we went to coffee.
1:12:57
SPEAKER_05: That's what we do, you know.
1:13:00
SPEAKER_05: There's a lot of people in this room that have a huge amount of knowledge.
1:13:04
SPEAKER_05: Just reach out and ask them, okay.
1:13:06
SPEAKER_05: I'm reading two books.
1:13:08
SPEAKER_05: One is The Chip War Right Now, which is kind of just a fun book.
1:13:12
SPEAKER_05: Another one is Profit First, okay, and that's why we're all here to make our lives better, increase our quality of life.
1:13:22
SPEAKER_05: Okay.
1:13:23
SPEAKER_05: A little trick that I do, and I've done it literally for probably 45 years, is at the end of every financial cycle monthly, I take all my extra money and I put it into a holding account.
1:13:40
SPEAKER_05: So when I look at my bank account, I have$300.
1:13:45
SPEAKER_05: Okay.
1:13:46
SPEAKER_05: Sounds kind of weird, right?
1:13:48
SPEAKER_05: But then when I go to bed, I say, I've got three hundred dollars.
1:13:52
SPEAKER_05: I better get a good night's sleep and I better wake up tomorrow morning because I've only got three hundred dollars, and that's the logic that really drives me.
1:14:02
SPEAKER_05: Okay, it's illogical.
1:14:04
SPEAKER_05: But you know, if if you look at your bank account and you've got eleven thousand nine hundred and twelve dollars, I think I'll go out to dinner tonight.
1:14:14
SPEAKER_05: I think I'll spend a couple hundred dollars.
1:14:16
SPEAKER_05: I think I'll buy some roses, which is important.
1:14:18
SPEAKER_05: Do that with the 300 that you have.
1:14:21
SPEAKER_05: But really discipline yourself so that you can make money long term.
1:14:28
SPEAKER_05: Okay.
1:14:29
SPEAKER_05: So I guess that's my final comment.
1:14:32
SPEAKER_05: And if anybody wants the coffee, that's what I do.
1:14:35
SPEAKER_05: I do coffee really good.
1:14:37
SPEAKER_05: Really good.
1:14:40
SPEAKER_00: Um I'm gonna I'm gonna piggyback a little bit on what what what Brian was talking about is I have uh two daughters and and and a wife, and my wife, uh uh, I'm gonna give her a little shout out.
1:14:54
SPEAKER_00: She's uh been in two industries her her whole life.
1:14:58
SPEAKER_00: Uh one is the beer industry, which is very, very male-dominated.
1:15:02
SPEAKER_00: Male work in the industry, males drink the product more than women, and uh very successful career in that.
1:15:12
SPEAKER_00: And she's owned her own sports marketing company for the last 20 years.
1:15:16
SPEAKER_00: She's uh uh is the number one seller of of sponsorships in boxing.
1:15:23
SPEAKER_00: She's in Las Vegas right now working with Mike Tyson.
1:15:26
SPEAKER_00: Uh she's worked with Matty Packa, Floyd Millither, Oscar De La Hoya, Canelo Alvarez is a client.
1:15:31
SPEAKER_00: I mean, just the the cream to the cream of the best boxers in the world.
1:15:36
SPEAKER_00: What I'll tell you, somebody back here said, Who am I?
1:15:40
SPEAKER_00: And they said, Oh, I'm a nobody.
1:15:42
SPEAKER_00: Nobody in here is a nobody.
1:15:44
SPEAKER_00: Um you you you are you're ahead of 90% of the people in the world because of one of the three things that I tell my two daughters that you have to do if you want to be successful.
1:15:56
SPEAKER_00: And they're in no particular order, this is just my theory.
1:15:59
SPEAKER_00: And and number one, you gotta be available.
1:16:03
SPEAKER_00: Every single person in this room took time out of their Saturday to come here and learn something.
1:16:10
SPEAKER_00: The four of us are not up here just to try to give you knowledge.
1:16:13
SPEAKER_00: We're we're learning at the same time that we're sitting here.
1:16:16
SPEAKER_00: I'm learning from these three guys, I'm learning from Juan, I'm learning from every everybody here.
1:16:20
SPEAKER_00: So, number one, you all have made yourself available.
1:16:25
SPEAKER_00: Number two, everybody's here because they're curious.
1:16:30
SPEAKER_00: Be a curious person.
1:16:32
SPEAKER_00: You know, and I I I've told this story many times, and Bill Gates' uh dad, who was an attorney in Seattle, talked about uh the Bill Gates and he goes, Oh, was he smarter than everybody as a kid?
1:16:47
SPEAKER_00: And did he know more than everybody, or how did you know he was gonna be successful?
1:16:51
SPEAKER_00: He goes, Yeah, he was smart, but he wasn't smarter than anybody.
1:16:53
SPEAKER_00: He goes, but his dad said what he had was incredible curiosity.
1:16:57
SPEAKER_00: And then Bill Gates, the son that started Microsoft, wrote, he goes, the number one skill in the 21st century is gonna be curiosity.
1:17:06
SPEAKER_00: And he said, the reason the people that are curious are gonna be successful, it's because of what you guys were talking about, the pace of change.
1:17:12
SPEAKER_00: Things are changing so fast that if you're not a curious person, you're gonna be left behind.
1:17:18
SPEAKER_00: And then the third thing, you know, for me it's curiosity, be available, and then the third thing, and it's I and I I and I I'm always careful to tell people this.
1:17:26
SPEAKER_00: I don't people take it the wrong way, but when you have two daughters and you have a wife that's been successful in two tough industries and stuff like that, I say, you gotta be mentally tough.
1:17:36
SPEAKER_00: He goes, and you gotta be mentally tough, especially for women, because I've seen it with women, it's very easy to be a victim and say, oh, poor me, my parents aren't rich enough.
1:17:46
SPEAKER_00: Oh, poor me, I didn't come from money, oh, I'm not tall enough, oh I'm not this.
1:17:50
SPEAKER_00: So listen, you're talking uh, my mom was born in Mexico, came here with not 10 cents, didn't speak a word of English.
1:17:58
SPEAKER_00: My dad came from Cuba in 1955, didn't speak a word of English.
1:18:03
SPEAKER_00: And and uh they raised three kids, all went to college, all went to graduate school, all doing doing pretty well.
1:18:10
SPEAKER_00: But but they did that because they were they were mentally tough.
1:18:14
SPEAKER_00: They did, they just you know didn't let us put up with anything.
1:18:16
SPEAKER_00: And I told my I tell my daughters all the time, I said, your dad will put up with a lot of stuff.
1:18:21
SPEAKER_00: The one thing he will not put up with, I will not put up with being the victim.
1:18:26
SPEAKER_00: So that's that's awesome.
1:18:29
SPEAKER_00: Thank you guys so much.
1:18:30
SPEAKER_09: Let's get around one last thing.
1:18:35
SPEAKER_00: I'm I'm gonna uh it's a cheap.
1:18:41
SPEAKER_00: I'm gonna buy everybody lunch here.
1:18:43
SPEAKER_00: So everybody, um, I'm I I appreciate this young guy here.
1:18:48
SPEAKER_00: I mean, how old are you?
1:18:49
SPEAKER_00: Uh 18.
1:18:50
SPEAKER_00: 18.
1:18:51
SPEAKER_00: I wish I wouldn't have been coming this stuff when I was 18 years old.
1:18:53
SPEAKER_00: You know, I wouldn't I wouldn't have 20 restaurants, I'd have 2,000 units.
1:18:58
SPEAKER_00: I wouldn't have 150 units, I'd have 3,000 units.
1:19:02
SPEAKER_00: So you're getting way ahead of everybody.
1:19:04
SPEAKER_00: But I'm gonna this is good in any of the the the 21 stores here on the on the on the on the back.
1:19:09
SPEAKER_00: Enjoy a free sub on me.
1:19:17
SPEAKER_08: All right, guys, thank you guys so much.
1:19:19
SPEAKER_08: If you want to network, probably work towards that that direction.
1:19:22
SPEAKER_08: Some people will hang out.
1:19:23
SPEAKER_08: Um thank you guys for being here, but we're gonna keep coming back every month.
1:19:26
SPEAKER_08: The space will be more accommodating in the in the coming months.
1:19:30
SPEAKER_08: Guys, thank you so much for being here.
1:19:31
SPEAKER_08: Thank you.