Latest / The Hannah Hammond Show / From 0 to 298 Deals: How He Built a Development Empire - Joshua Simon

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From 0 to 298 Deals: How He Built a Development Empire - Joshua Simon · The Hannah Hammond Show

• 0:00
  My theory is if you have a good deal, money always shows up.
• 0:03
  There's a founder mode, which is like the theory that Elon, Jeff
• 0:07
  Bezos, the Airbnb CEO, like they're all about founder mode,
• 0:11
  which is they believe in getting into all the details and then
• 0:14
  zooming back out and being like direct communication and not
• 0:17
  this hierarchy. And them as CEO, like they can
• 0:20
  jump into anything. And I think in development you
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  have to know everything. You have to trust so many people
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  to have the outcome that you desire because you can't do it
• 0:30
  all yourself. Because when you don't know
• 0:32
  everything going on, that's when stuff goes sideways.
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  Yeah, because you really lose control and you can't step in to
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  fix it. So many things aren't in your
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  court and you have to try to get everybody to row the boat in the
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  same direction. Inspire people to row the boat
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  in the direction that you want it to go and at the same speed
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  of that you're rowing. Sometimes you have to go slow to
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  move fast. What systems have you put in
• 0:55
  place to help you guys scale? Welcome back to the Hannah
• 0:59
  Hammond show. I'm sitting here today with
• 1:01
  Joshua Simon, founder and CEO of Simon CRE.
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  And they are one of the biggest retail real estate developers in
• 1:08
  the country. And I've been reading about you
• 1:11
  and I've heard about you through EO from multiple people and
• 1:14
  super excited to hear your story.
• 1:16
  And I mean you've done over 1.2 billion in development IT
• 1:21
  nationally. Yeah, well, thanks for having
• 1:25
  me. And you're.
• 1:26
  I feel like the Gray hairs are going to come in after thinking
• 1:29
  about all of these projects that we've done over the last couple
• 1:31
  decades. That's crazy, $1.2 billion,
• 1:35
  that's insane. And two 2.6 million square feet.
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  Is that right? Yeah, 300 projects.
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  So it's a lot of purchase agreements, a lot of leases.
• 1:45
  Yeah, a lot. It's so funny because that
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  we'll, we'll get into that later.
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  But I it's funny because you started at like the bottom of
• 1:53
  the market. You started your company in 2010
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  when everything had collapsed. Everybody was terrified of
• 1:58
  everything. And then you've gone through
• 2:00
  multiple cycles like COVID, which was, I'm sure, terrifying
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  as you're doing these massive projects.
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  And then now with all the interest rate environment that
• 2:09
  we're in and after, you know, Amazon and all that stuff, I
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  think a lot of people started to shy away from retail and you
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  just doubled down on it. And you've been known to do
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  projects that everybody else runs from.
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  Yeah, you know, you got to be a trendsetter.
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  You know, I don't think you ever want to be.
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  You don't want to be the first, but you definitely don't want to
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  be the last. And so kind of like, you think
• 2:28
  about Walmart, Kmart was first, Walmart came second.
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  You know, you Fast forward 50 years, what happened?
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  Walmart's still around. Kmart is of a bygone era.
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  Yeah, and figure out what they did wrong and how to do it
• 2:40
  better. And and adapt, and the other
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  people don't adapt. Yeah, exactly.
• 2:44
  What What specific incident in your life inspired you to get
• 2:47
  into real estate development? You know, I've always been
• 2:50
  fascinated with construction, grew up just watching, you know,
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  love to watch roads being built, houses getting built, the smell
• 2:57
  of asphalt, the smell of a 2 by 4 and just seeing things get
• 3:01
  built and creating for the community really motivated me.
• 3:04
  And so I had the opportunity to get an internship in college and
• 3:08
  which I, you know, highly recommend.
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  And we have interns at our office now for the summer.
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  And it's just such a good way to give back.
• 3:16
  But also to really like, you know, wet your whistle a little
• 3:18
  bit like, Hey, is this an interesting thing that I think I
• 3:21
  want to do? And so I got into it.
• 3:23
  I'll never forget April Fool's Day 2004.
• 3:26
  But the joke was not on me. So it all worked out and worked
• 3:29
  for developer until 2010. And as you mentioned, you know,
• 3:34
  starting in 2010 was a scary time.
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  But also, look, I, I was young, I didn't have a wife, no kids, I
• 3:41
  didn't, and I have, I think I did have a condo mortgage, but
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  besides that, like I had nothing to lose.
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  And the market was at the bottom.
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  People wanted, you know, they were looking for work,
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  architects, surveyors. And so there was a lot of
• 3:55
  opportunity and I just felt like, hey, that was it was my
• 3:58
  shot to take. And what kind of so you worked
• 4:02
  for a developer, so that's really smart.
• 4:04
  What was your role when you were working for a developer?
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  I wore a lot of hats. So when I was brought on, I was
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  a college kid bidding projects, didn't have any idea what I was
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  doing. I was negotiating leases.
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  I remember my first deal was comic cleaners in Coolidge, AZ,
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  if anybody could put that on a map.
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  But I got the letter of intent from the broker and it looked
• 4:23
  like Chinese to me, like I had no idea code tendency, opening
• 4:28
  rent commencement, like all these words and we didn't have
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  ChatGPT right? To be like, Hey, what should I,
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  how should I respond? And so it was just so foreign.
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  And then just learning and that that next step of like learning,
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  OK, well, now I understand leasing.
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  And then, oh, I got a bit of project and plans and a lot of
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  trial by error. And I was very fortunate.
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  The CEO that I worked for had really made me like his right
• 4:52
  hand and I was really able to learn a lot where I don't know
• 4:56
  if I would have gotten that education somewhere else.
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  And so I got exposed to a lot of different things across a broad
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  spectrum in the business. Yeah, being that that right hand
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  man, because most roles are so segmented, you can't really get
• 5:10
  a full picture of what's going on so.
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  Yeah, or just ask a lot of questions.
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  Like we had an attorney in our office and he actually still, he
• 5:17
  works with me now. We've worked together for
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  basically 20 years. And I would take him to coffee
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  every day that I was in the office and not at school.
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  And I would just pound him with questions.
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  What do we do here? Why do we do this?
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  Why do you do this? And I think that just innate
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  curiosity is like so powerful to make you successful in your
• 5:36
  career. Do you think you were going to
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  start your own development company when you were learning
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  everything? Was that in the back of your
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  mind? No, and it's funny because I
• 5:45
  talked to our attorney Joe about this and I never thought that,
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  but he was like, no, you definitely were.
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  You know, you fast. Think about yourself when you're
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  18, I'm in college, I've been having a good time.
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  You're trying to balance that. And I was like, hey, look, I
• 6:00
  just want to be successful. You know, back then, you know,
• 6:03
  you still weren't ready for 21, so you couldn't go to the club.
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  But like, oh, when you you were right, you wanted to go on like
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  a cool trip or be able to take a girl out.
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  So I think really there your capacity to think bigger is
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  somewhat limited. But what I did always have was
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  like a like an unstoppable drive.
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  And you just had that since you were a little kid.
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  Yeah, I walked at 8 months, which my parents were like you
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  little deep, you know? So yeah, I've always been very
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  driven. Were your parents in real estate
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  at. All no, my dad's an attorney, my
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  mom's stay at home mom and you know, I just had a really good
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  stable upbringing, which I think also helped to, you know,
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  facilitate my advancement. You know, I didn't have any of
• 6:49
  these crazy. Hey, I need a good therapy
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  stories. At least not that I've
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  discovered. Yeah, yeah, that's, that's
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  amazing. I know I talk a lot about trauma
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  and healing and childhood and how it affects your ability to
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  succeed in life and and how, you know, fear can be such a huge
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  driver instilled in all of us. I mean, that's our survival
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  brain, like fight or flight. We don't want to, we want to not
• 7:13
  lose or not die more than we want to win.
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  And that's initially what drives us, right?
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  But that's really cool that you had a good upgrade.
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  Were you born here? Yeah, Chicago.
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  And then I moved here when I was 12.
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  And so you bring up trauma and I, I've thought about this.
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  The only thing I'd say is, you know, I'm still not very tall,
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  but I was like the youngest kid in high school because I'm on
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  August birthday. And so my parents pushed me
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  forward. So I was always the shortest kid
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  and in high school, like I'd get picked on, you know, and I was
• 7:42
  on the school foot on the varsity football team and I was
• 7:44
  like the smallest guy. And so I was good target
• 7:47
  practice, which was fun. But I think that did give me
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  like a little chip on my shoulder perhaps now that I
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  reflect back. But I think like, look, your
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  drive, like it's what you create and you can take that, you know,
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  the trauma, the excitement and ultimately, like, I love what I
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  do. It's stressful, it's hard, but I
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  eat, drink, sleep, breathe it. Yeah, and yeah, I think we all
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  have these traumatic things and IA lot of various the most
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  successful people that I know, usually there was something in
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  their childhood that both being bullied or being abused or, you
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  know, whether physically or sexually or having a really
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  toxic family environment or things like that.
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  And it usually drives them. You know, think of Oprah like
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  the biggest example, right? It's driving them to just never
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  quit and be so resilient that no matter what you go through, you
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  can overcome it and you're going to keep going and grow.
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  That's awesome. And OK, so you work for the
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  developer. You decide.
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  Were you a broker ever? I'm licensed broker, but never
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  when I first went 2010, all right, There's nothing really
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  going on. And so I was doing anything to
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  make money. I was doing some brokerage
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  deals, some Cricket Wireless deals, a men's clothing store.
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  So I was doing some transactions but like from day one my goal
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  was to do development and redevelopment.
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  So what did the journey look like when you decided I'm gonna
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  start a development company? What was the process from that
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  point to get going? Like how much money did you
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  launch with and what, what, what did it take to start?
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  Like did you have somebody to to help you?
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  How did you start identifying sites or raising money?
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  Like what was that process? You know, talk about a winding
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  road, right? So I started maybe like 50 grand
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  in my bank account. Really didn't have much.
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  I was kind of like, let's go, let's figure it out.
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  And so, you know, I didn't have a, a suit.
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  Like I had a plan of, hey, I wanted to be able to find
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  opportunities. I started on my like by myself,
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  my mom would come in a couple days a week and she'd be like,
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  hey, Josh, I'll help you. Because she, you know, was
• 9:53
  retired, didn't have, she had more flexibility in her
• 9:57
  schedule. And so she would come in and
• 10:00
  open mail or do this and do that.
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  And it was that was helpful in the sense of taking some of that
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  like administrative stuff off the plate, but also having your
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  mom there was is cool. And I worked with her for 1515
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  years. So yeah, long time but raising
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  money. So like my theory is if you have
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  a good deal, money always shows up like it's just not going to
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  be hard like if a deal is good. And so my first deal was a deal
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  in Clinton, IA, home of Flavor Flav and it was a former movie
• 10:31
  like movie gallery store. And we had a Verizon Wireless
• 10:37
  deal, a dealer that was going to was interested in backfilling
• 10:40
  that. And so we bought, you know, it
• 10:42
  was like probably AI mean it was such a small deal, 6 or $700,000
• 10:46
  deal and 2010 nothing going on. Who's going to lend to a 24 year
• 10:52
  old kid that money? So I went out and there was a
• 10:56
  group of like private individuals out of the Midwest
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  and I think I paid like 18%. I remember looking it up
• 11:01
  recently just to see, but 18% on like a first position, first
• 11:06
  deal. I turned it around in six months
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  and on that deal though, going back to where I started, like
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  vendors were willing to work with you because of the time
• 11:14
  period, the surveyor, the architect, the arch, like
• 11:18
  everyone gave me terms on payments.
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  So like I don't have to pay them till closing.
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  So I got this like I bought myself like ninety 120 days to
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  be able to basically 100% finance it at closing and not
• 11:32
  have to come out of pocket. I put up the earnest money.
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  That's insane. So that that worked out.
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  And so we were able to slowly kind of get the wheel turning
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  and, you know, 298 deals later. That's insane.
• 11:45
  That's so cool. It's so inspiring.
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  I love, love, love to hear these stories.
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  So usually the lenders gave you 100% financing or you raised
• 11:53
  capital for the equity. Project I I didn't do any equity
• 11:56
  and so here my theory, crazy theory is I don't have any GPS
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  like LP's situation we raise we we do bank today, we do bank
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  financing. We get a pref like a mez piece
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  and then I'll put I usually put equity in so we don't share like
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  I just believe that like, hey, when I build a shopping center,
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  there's a lot of value that I'm creating in day one.
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  And so for us to if you think of this table as a pie, if I got to
• 12:24
  give 80% for me, if I got to give 80% up to an equity
• 12:28
  investor and I'm getting 20% some fees like that means I got
• 12:32
  to make a lot more of those pies.
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  But if I keep the whole by that's a lot more for my for
• 12:37
  myself. And so our model has always been
• 12:41
  we're raising. So that deal going back to your
• 12:43
  question is we raised 100% of debt with private individuals.
• 12:47
  So they're they got, they just got their interest.
• 12:51
  Gotcha. And so it's it's were you able
• 12:54
  because it wasn't structured as a fund?
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  Nope. Was it one person on the deal
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  like? One, yeah, they did like an LLC,
• 13:01
  So it's probably like 6 people, yeah, that put up the and like,
• 13:05
  look, it was a bunch of real estate guys that each put in,
• 13:07
  call it a couple 100 grand at the time.
• 13:10
  And you just structured it as a no, not they weren't members of
• 13:13
  the like the ownership entity. Awesome.
• 13:16
  That's amazing. That's a pretty good game.
• 13:18
  So how long did you keep doing that for?
• 13:19
  Are you? Still, so we transitioned to
• 13:21
  doing so the first handful of deals like, you know, we did it
• 13:26
  somewhat like that and then we got introduced to a couple
• 13:29
  groups in town and then we're still doing private lending.
• 13:33
  And so I was like, wow, we need to get into the bank space
• 13:36
  because bank financing is a lot more affordable.
• 13:39
  Obviously it adds a lot of barriers, paperwork, other
• 13:42
  things. And so we did our first couple
• 13:44
  of regular bank financing deals and so we got tied into, you
• 13:49
  know, some wealthy private Country Club kind of money until
• 13:53
  this day. We've probably done 100 deals
• 13:55
  with some of these folks over the last 15, you know, 13 years,
• 14:00
  I should say. So it's been relationship and
• 14:04
  just repeat business and like at the end of the day, you got to
• 14:07
  be a good salesperson in real estate to execute.
• 14:10
  But like a lot of people are really good at this, but they're
• 14:12
  not good at the execution piece. And having, you know, whether
• 14:16
  it's your COO or you being that person, which that's a hard
• 14:21
  person to put both things together is so important.
• 14:24
  And I think that's where we've gotten it right is we do I think
• 14:28
  a pretty good job on the sales side, but we also do a really
• 14:31
  good job on the execution. Right.
• 14:33
  Can't have one without the other.
• 14:35
  Yeah. And I'm just fascinated by this,
• 14:38
  this structure of these deals. So for your private investors,
• 14:42
  you have your bank piece, maybe your MEZ piece and then you have
• 14:44
  the rest of your equity to your 30%, right?
• 14:47
  Are they still as you grew and progressed?
• 14:50
  Are they still just doing it as a note in second position or
• 14:53
  third? Yeah.
• 14:53
  And really with, you know, the 2010 and the Dodd Frank Act,
• 14:58
  they have the high, high, you know, high volatility commercial
• 15:02
  real estate loan. And so really you can't
• 15:05
  structure it as a second. It has to be kind of an
• 15:08
  unsecured note. That's what I was saying,
• 15:10
  because the banks won't let you subordinate.
• 15:12
  Usually, and so it's most it's, it's just in like there's
• 15:16
  different ways to doing it. Like you can do a kind of
• 15:19
  secured with the membership in like a, a takeover right in the
• 15:23
  operating agreement. So I can get, you know, I would
• 15:26
  get removed if I don't pay them back.
• 15:28
  There's different ways of doing it.
• 15:29
  And then, you know, Fast forward, you know, this is now
• 15:32
  probably five years ago, we had gone to certain, you know,
• 15:36
  groups to get those funds and like we've been using them as,
• 15:40
  you know, almost like a broker dealer, like they wouldn't make
• 15:42
  the introductions. Now, you know, we started having
• 15:45
  folks that are like, hey, we want to invest, we want to
• 15:47
  invest. And so again, we would just do
• 15:49
  deal by deal. About 3 years ago, we
• 15:53
  transitioned it and created our own fund that we use and we have
• 15:57
  discretionary and those are folks that we've known.
• 16:00
  Like we don't go out and advertise it, it's just friends
• 16:04
  and family. And so we use that and that's
• 16:07
  just grown, grown by itself. So we have that bucket, we go to
• 16:10
  a third, you know, second group in town that they'll bring in
• 16:13
  funds and then we have our own capital now that we also deploy.
• 16:17
  OK. And were you, I know you said in
• 16:20
  the beginning you weren't putting any of your own capital
• 16:22
  in. Did you start putting your
• 16:23
  capital into the deals as you? Yeah, and now we do.
• 16:26
  And I look at ours is like we have like I have a number of
• 16:31
  like I have a cash number that I sleep better at night and so
• 16:34
  that we always need to be at. But like mine is second to
• 16:38
  making sure our investors get, you know, we can get investors
• 16:41
  into deals. And so a lot of times I'll put
• 16:43
  money in somebody say, hey, we want to invest or a deal sells.
• 16:47
  So we'll have to move capital around.
• 16:50
  So there's like constant transactional volume like we'll
• 16:54
  probably do, oh, I don't know, this year it depends, but you
• 16:58
  know, 34, you know, 30 sales. So and when you think about in
• 17:03
  commercial retail, that's a that's a lot.
• 17:05
  Yeah, right. Yeah, because these are whole
• 17:08
  centers. Yeah, whole centers or maybe
• 17:10
  it's a Starbucks. And so like for every, you know,
• 17:12
  for every purchase, if we're buying 20 acres, we'll probably
• 17:15
  we'll develop it and we might sell it off in eight pieces when
• 17:19
  it's fully built open. We'll sell the Starbucks, we'll
• 17:21
  sell the, let's say the gas station, we'll sell the the gym,
• 17:25
  the grocery store, all separately.
• 17:28
  OK, interesting. So are are you doing like you're
• 17:32
  just carving out sections of the project and leasing them up and
• 17:36
  then selling? Yeah.
• 17:37
  And so the way we try to look at it is like I look when we close
• 17:40
  for us because we were going higher leverage, how do we
• 17:44
  immediately take risk off the table and how do you do that you
• 17:48
  sell off risk. So we might do a forward takeout
• 17:50
  with a group if it makes sense. What's a forward takeout?
• 17:54
  So somebody, let's just say I have a signed lease with a
• 17:58
  grocery store or a fitness use, I can go to a capital provider
• 18:02
  and they'll say, hey, we'll buy this at this cap rate and we'll
• 18:06
  close now. Or hey, we'll give you a
• 18:09
  commitment to buy it. And then you can use those funds
• 18:12
  to lower your cost, your equity going into the deal.
• 18:15
  So you kind of do simultaneous closes.
• 18:18
  So you really orchestrate some crazy financing stuff.
• 18:22
  And so that's where my mind goes is how do we lay off risk
• 18:26
  immediately? So you know, somebody's going to
• 18:29
  say, oh, you're high risk. But I actually say, hey, the way
• 18:31
  we look at risk is we're going, it's short term.
• 18:34
  And so like we're not keeping things going for a long period
• 18:37
  of time. So we'll sell off most of those
• 18:40
  pieces right away, right away in real estate terms, meaning
• 18:44
  within 12 months, let's say. Right.
• 18:47
  Yeah, because I want to talk about that, how you mitigate
• 18:49
  risk, because obviously, I mean, for me, my biggest fear of
• 18:52
  development is the risk. Like these are long projects.
• 18:55
  See What's your average timeline for a total project from start
• 18:59
  to finish? Well, from the time you talk
• 19:00
  about it or the time you close. The time you submit an LOI.
• 19:04
  Yeah. So like it could be 345 years.
• 19:08
  I would say most of them you're probably like on a decent sized
• 19:12
  project to 2 1/2 years on a smaller project a year and a
• 19:15
  half from LOI from close to the first sale.
• 19:20
  We used to when we were doing 45 single tenant deals a year, we
• 19:24
  were selling, we were turning product in 5 1/2 to seven months
• 19:28
  from close, not LOI, but from when we close on the property,
• 19:31
  start construction finish, turn over to tenant and we'd have it
• 19:34
  sold. And so were you mostly doing
• 19:36
  single tenant net lease developments?
• 19:38
  90% was that and that was up until, you know, through the,
• 19:42
  you know, 2019 we started to look at shopping centers and be
• 19:46
  like there's going to be something here, there's going to
• 19:48
  be something here. And so, you know, we built a ton
• 19:52
  of dollar generals, a ton of O'Reilly auto parts.
• 19:54
  And for me, it also, I was getting to a point where I've
• 19:58
  been doing it for 10 years and they're great folks that we
• 20:01
  worked with. But you know, they were trying
• 20:03
  to hit open, you know, thousand stores a year.
• 20:06
  And so you get to a point where your head's kind of on like the
• 20:09
  proverbial grindstone and it's like, what if you know, you're
• 20:13
  always doing something wrong or it's just more, more, more.
• 20:16
  And these like pressure deadlines.
• 20:18
  And I got to a point where it's like, I don't want to be in this
• 20:21
  pressure cooker. And it's also.
• 20:23
  When you're developing single tenant, there's a, there was a
• 20:26
  lot of folks coming into the business and even more in the
• 20:28
  last few. You know, I guess pre interest
• 20:30
  rate run up, but you're building a widget like it's not super,
• 20:35
  super complicated when everything goes okay, right.
• 20:39
  But like the reality is things happen.
• 20:41
  And so, like, I just got tired of being that widget maker and I
• 20:44
  wanted a little more, you know, interest for my career and like,
• 20:48
  what I was doing when I was giving back, like, Oh yeah, I've
• 20:51
  built all these dollar generals in all these small towns.
• 20:54
  Cool. Helps the community.
• 20:55
  But like I wanted to do something bigger.
• 20:57
  Yeah, more community focused, not just shopping or go a
• 21:01
  commodity. Yeah.
• 21:03
  So for the audience listening, if they were to want to get into
• 21:06
  development and let's say single tenant net lease retail, which
• 21:09
  you don't know, that's like a single building with a single
• 21:12
  tenant like a Dollar General or a Starbucks or Chick-fil-A or
• 21:14
  anything like that. And my newer company, HP Capital
• 21:18
  Refinance, I'm partnering with a team who's been a top producing
• 21:23
  team in the country for like, you know, almost 30 years and
• 21:27
  85% of their business is in the single tenant space.
• 21:30
  And so they've done a lot of those deals and, you know,
• 21:33
  invest in the deals and land on the deals and, and put
• 21:36
  everything together. So it's I've more recently
• 21:39
  because I don't do a ton of retail up until now.
• 21:41
  Now I've kind of walked, walked into more retail.
• 21:43
  Yeah. But so like, how if you're like,
• 21:46
  if you decide I want to be a single tenant retail developer,
• 21:50
  how do you get in that game? Do you, are you the 1
• 21:53
  identifying buying the property and because you have the land
• 21:55
  you get to go to the the tenants and be like, hey, we have a
• 21:58
  really good site or like what does that process look like?
• 22:01
  I think from from my point of view, and it could be different
• 22:04
  for everybody else, but like for me, it's the relationships and
• 22:06
  it starts with having good relationships.
• 22:08
  Like how do you find most of your deals?
• 22:10
  It's, you know, through that relationship or you know, hey,
• 22:12
  somebody wants to be here. I heard this tying up land and
• 22:17
  then going fishing is tough, but sometimes you have to do that to
• 22:20
  start. But ultimately, like our whole
• 22:23
  business models been built on repetitive business and then
• 22:27
  hey, people know we can get it done, so we get the next deal.
• 22:31
  And so how do you get in? I build the relationships across
• 22:35
  the retailer spectrum, but like also you got to understand how
• 22:38
  stuff gets built, right? And so like, my opinion is like,
• 22:42
  I think the best folks to become developers or brokers that have
• 22:46
  an attention to detail, that know, understand the
• 22:49
  transaction, understand the players.
• 22:51
  And then, you know, go that extra mile where they're like
• 22:54
  kind of curious about the lease process.
• 22:55
  They're curious about an estoppel or what an SNDA is or
• 22:59
  hey, the survey or the title, right?
• 23:01
  It's I think it's that general curiosity that leads to the next
• 23:05
  level for somebody wanting to do development.
• 23:09
  And what I mean, the relationships are everything,
• 23:13
  but when you don't have experience in the beginning,
• 23:15
  right, you don't have a track record.
• 23:16
  How did you overcome, if you're going to, you know, a Dollar
• 23:19
  General, how did you convince them to work with you or what
• 23:22
  was your value proposition of, hey, give us a shot on this
• 23:24
  project versus because they already have developers that
• 23:28
  they've worked with in the past? So you got to squeeze your way
• 23:31
  in on those first ones, right? It might be, you know, that
• 23:34
  they, you heard that they need to be at that site and then you
• 23:37
  just become persistent on Dollar General.
• 23:39
  I had done one, I'd done a couple.
• 23:41
  And in the past there was a new kind of regime.
• 23:45
  I heard that they were looking, it was I think in your current
• 23:48
  California. And so I did all the research.
• 23:51
  I found the site. I just hammered on the Dollar
• 23:55
  General person, a great guy. I'd been in the business for,
• 23:58
  you know, 30-40 years, Chuck Perkins, and finally got a call
• 24:03
  back and he called. I dropped what I was doing right
• 24:06
  and I had to go right into the pitch of the why.
• 24:09
  And he gave me a hard time. It was great and I was ready and
• 24:13
  but he kind of took a liking to me, right?
• 24:15
  And so I think it's like, how do you connect with people and then
• 24:18
  follow up and ultimately like, how are you making it an easy
• 24:22
  transacted transaction, right? Who do you want to work with?
• 24:25
  Who do you want to talk to people that are like, it's easy,
• 24:28
  right? It feels easy.
• 24:29
  Yeah. Sometimes it's tough on your
• 24:31
  side, sometimes it's tough on mine.
• 24:32
  But like I try to make it where I'm going to be very responsive
• 24:37
  and quick and easy to work with. You're not going to always like
• 24:41
  what I have to say or my answer, but I'm going to be very
• 24:45
  responsive. Simon Speed.
• 24:47
  Simon Speed. There you go.
• 24:49
  You. I heard that you coined that in
• 24:50
  your company. Simon Speed.
• 24:52
  Execute it hates it sometimes but you know some.
• 24:54
  I will say sometimes you have to go slow to move fast so.
• 24:58
  I'm learning that, yeah, yeah. Sometimes if you are so in, you
• 25:02
  can't see the forest through the trees, you know, And if you're
• 25:04
  just sometimes we're climbing up the the wrong wall.
• 25:08
  Like we have the ladder, we're climbing it, but it's on the
• 25:10
  wrong wall. And then we get there and we're
• 25:11
  like, oh shit, this is the wrong wall.
• 25:13
  I need to go all the way back now.
• 25:14
  Yeah. And sometimes you have to have
• 25:15
  patience like, Hey, I know this is going to happen, right?
• 25:19
  And so some of that's that confidence and oh, I don't want
• 25:22
  to maybe lease that space or I don't want to sell this pad.
• 25:25
  Just wait a little bit longer. I've learned that in the last,
• 25:29
  you know, few years, like, you know, especially as we, you
• 25:32
  know, our real estate, you know, we're talking about Dollar
• 25:35
  General O'Reilly, which good real estate, but our real estate
• 25:37
  profile just really much better real estate for target, you
• 25:41
  know, Sprouts, a Whole Foods. So our profile has gone up.
• 25:45
  So I've had to relearn some of the business in that way.
• 25:49
  And how you think about real estate and positioning and
• 25:52
  merchandising? What so in in the beginning when
• 25:57
  you just started and you're negotiating this deal with, was
• 25:59
  that your first deal? No, it's Verizon.
• 26:02
  Verizon Wireless. OK, dealer.
• 26:05
  And so you just what made you pick Verizon?
• 26:08
  You know, I had a a relationship and the broker represented them
• 26:12
  in that market and I was just, I think he, you know, we had a
• 26:17
  good relationship and he's like, hey, you know, they want to be
• 26:20
  in downtown Clinton, IA. He's like, see what if you can
• 26:23
  find anything like I've tried to, you know, he might have
• 26:26
  even, you know, this is 15 years ago.
• 26:28
  Like said, hey, the group that owns this doesn't respond.
• 26:31
  Can you see if you can get it tied up like Verizon?
• 26:34
  You'd have to, you know, fix it up, turn key it, which you know,
• 26:37
  means, you know, make it ready for occupancy.
• 26:40
  And fair enough. I'd tracked them down.
• 26:42
  We bought it and delivered. And then we did.
• 26:45
  We went on to do several deals. So were you you actually bought
• 26:49
  the land and you just had like a build to suit contract with
• 26:52
  Verizon and that's how and then you just got bank financing or
• 26:55
  was this back when you did the that's.
• 26:57
  Private money. Yep, the private money.
• 26:59
  And even today it's like, hey, we don't close on just land.
• 27:02
  We're not just going to go very rarely we have bought some at a,
• 27:06
  at a, you know, a very good price.
• 27:08
  But we always when we close, we're closing with sign leases.
• 27:13
  Entitlement risk is pretty much gone, right?
• 27:15
  We have all of our approvals or most of them, right?
• 27:17
  We're not really worried about that.
• 27:19
  We have AGMP gross maximum price contract with our contractor.
• 27:24
  So like all the pieces are pretty locked in.
• 27:26
  Like our biggest risk is like we start digging and it's you know,
• 27:30
  some kind of burial ground or you know, there's some nuclear
• 27:34
  contamination stuff going. So like our risk is like we're
• 27:37
  able to do that research up in front and do the due diligence
• 27:40
  so that when we close we've got you know 50% pre leased, right
• 27:46
  so. That's super cool.
• 27:48
  And for these development sites, how are you, how did you go
• 27:54
  about or how do you go about sourcing them?
• 27:57
  Like do you have a sales team in house that's cold calling, you
• 28:01
  know, owners of properties or how are you identifying where
• 28:03
  these good sites are so you could bring it to your clients?
• 28:06
  You know, I find most of it, you know, probably 8590% and it's
• 28:10
  just, you know, relationships, but also like, you know, I love
• 28:15
  to look at maps and, you know, think about where retailers will
• 28:19
  be and when you're, you know, I'm on the phone most of the day
• 28:21
  with brokers or tenants. And so, so just asking him, Oh,
• 28:25
  like, hey, how's that store do? Or Hey, what location?
• 28:27
  And then you start to build this, you know, database and we
• 28:31
  have our own mapping software that we store all of our notes
• 28:33
  in. So like if somebody else talked
• 28:35
  about this parcel, we can all see what each other are working
• 28:38
  on. But so much of it today is about
• 28:41
  just understanding where the anchor tenants want to go.
• 28:44
  And hey, how can we go find those sites to get out in front?
• 28:48
  Because you look at any the big anchors, whether it be Costco,
• 28:54
  Target, Walmart, Sprouts, Whole Foods, Safeway, they and more so
• 28:58
  on the mass merchandisers, they don't want to be by themselves,
• 29:02
  right? They want to be as part of a
• 29:03
  shopping center, but they're not doing the rest of the shopping
• 29:06
  center. So they need, it's a very
• 29:11
  relationship where we got to work together.
• 29:14
  And so really it's like, hey, can you execute?
• 29:17
  And, you know, when you're dealing with the bigger
• 29:19
  companies, you have to be very nimble because corporate America
• 29:23
  does things like this where you have to be like, right, you
• 29:26
  know, moving through and being very dynamic, very quick and
• 29:31
  very involved. And I think a lot of developers,
• 29:34
  you know, maybe aren't as involved as they should be in
• 29:37
  different pieces of the business.
• 29:39
  Do you have your own in house construction team or do you have
• 29:43
  Subs or AGC that you hire out? So we manage project manage but
• 29:48
  we we hire a general contractor on everything.
• 29:51
  We don't do any sub management in my opinion, just, you know,
• 29:56
  the GC business. I mean, every business is tough,
• 29:59
  but GC for us would be hard because our volume goes like
• 30:03
  this. And so to scale up, scale down
• 30:05
  for that is tough. Like in you know, we're good at
• 30:09
  building, but we're not great, which we're the general
• 30:11
  contractor. And so it's kind of like, oh, do
• 30:13
  we draw our own plans? No, but we, you know, we're
• 30:17
  enough to be dangerous to hopefully read them, but we're
• 30:20
  not doing our own plans. We're hiring an architect that
• 30:22
  has capacity to do it. And that makes sense because
• 30:26
  you've done projects in 23 states, so you can't have your I
• 30:29
  mean, you could, but who wants that?
• 30:31
  I try to start my I started 3 construction companies at one
• 30:34
  point in my life and I wanted to jump off a bridge.
• 30:38
  That's because I don't have them anymore.
• 30:39
  But Oh my God, that's the whole not for the faint of heart.
• 30:43
  Yeah, it's a lot. And how did you identify these
• 30:46
  relationships with your GCS in the beginning?
• 30:49
  Like on. Who to go with?
• 30:50
  Because that's such a big thing to trust, right?
• 30:52
  Because you're always yelling at the contractors.
• 30:54
  Yeah, there's always somebody to yell out.
• 30:56
  I like to say, you know, you just, there was groups I had
• 31:00
  taken relationships with previously and then just
• 31:04
  reaching out to the network. I think in Iowa I might have
• 31:08
  talked to the city who's doing work here.
• 31:11
  And look, in 2010 you had a pretty good picking.
• 31:15
  There wasn't a lot of people super busy in commercial real
• 31:17
  estate and commercial real estate development where I think
• 31:20
  the the bigger challenge had been in 2020, right where you
• 31:24
  had COVID and figuring out who the right group is and you know,
• 31:29
  are they have the right Subs. And that time period was
• 31:31
  probably the worst in 15 years. And then today as we sit, you
• 31:35
  know, June of 25, it's gotten a lot better because people are
• 31:40
  getting hungry and they're looking for work.
• 31:42
  And so we're starting to see time frames come in, We're
• 31:45
  seeing costs come down a bit. And so the, the dynamic, the,
• 31:50
  the balance of power, I don't think it's, I think it's fairly
• 31:53
  even. It might even be going a little
• 31:55
  bit in the developer favor, which, you know, after the last
• 31:58
  four years, it's like, thank you.
• 32:01
  Yeah, because it's, it's been in rough these past four years.
• 32:06
  Yeah. And, and and it's not all the
• 32:07
  general contractor, the subcontractors, right.
• 32:10
  And especially in certain markets like Phoenix with TSMC
• 32:13
  and like all this other business, it would be hard to
• 32:16
  keep Subs on the jobs, right. And you know, getting just
• 32:19
  materials and whatnot. So now it's it's gotten a lot
• 32:22
  better. And I'd say today, like I think
• 32:27
  our biggest challenge is how do we build faster?
• 32:31
  Like we want to get the time periods back, but really just
• 32:34
  being very thoughtful on a merchandising.
• 32:36
  And you know, today as you know, credit starts to get
• 32:39
  questionable and not like super questionable, but just hey,
• 32:44
  who's going to be OK? Who's going to be not OK?
• 32:47
  We're being way more cautious as we do deals like who's the best
• 32:52
  in class retailer? How do we structure the deal
• 32:56
  being very smart with that risk? Yeah, because there's so many
• 33:02
  factors that aren't in your control, like the company, the
• 33:06
  retailer and the quality of their credit and their guarantee
• 33:10
  or their lease or whatever, the developers and the
• 33:12
  subcontractors and their ability to deliver.
• 33:15
  I mean, there's just so many things.
• 33:16
  I was talking to a friend of mine the other day who's also a,
• 33:19
  he's a storage facility developer in the Mid Northeast.
• 33:22
  And it's just you have to you have to trust so many people to
• 33:26
  have the outcome that you desire because you can't do it all
• 33:29
  yourself. But it's such an uncomfortable
• 33:31
  feeling to know that so many things aren't in your court and
• 33:35
  you have to try to get everybody to row the boat in the same
• 33:37
  direction. And that's been my biggest
• 33:39
  difficulty is the people piece. Like, how do you inspire people
• 33:44
  to row the boat in the direction that you want it to go and at
• 33:47
  the same speed that you're rowing?
• 33:49
  I mean, my past employees would probably say I'm not the right
• 33:51
  person to ask. I would say it's been a long
• 33:54
  journey for me because I'm very type AI want demanding, very
• 33:58
  involved. I think, you know, I've learned
• 34:01
  a lot in the last few years and you know, now we're at an
• 34:03
  organization of we got 42 in office, 8 actually out of the
• 34:08
  country. And so we've got a big
• 34:11
  organization. And you know, what I found for
• 34:14
  me in leadership is we when we hire, so one, when we hire, we
• 34:19
  do what we call the gauntlet. And so you interview like a
• 34:23
  normal process with the manager, but the last step, and I don't
• 34:28
  really interview anybody now, but the last step is members,
• 34:32
  volunteers from different departments come in and it
• 34:35
  sounds more scary than it actually is, but they'll ask you
• 34:37
  like questions, not about your job, but just you.
• 34:41
  And then they all vote Google forms submit like, is this a
• 34:44
  person I want to work with? Is this a person I'd have a beer
• 34:46
  with? And then any comments.
• 34:48
  And I, I think we went against the forum one time and that one
• 34:53
  time the person didn't work out. And so, you know, however many
• 34:56
  forever many. So our team has been really good
• 35:00
  at knowing who fits, who's like part of our culture.
• 35:04
  And I think just being very transparent with your culture,
• 35:08
  like our core values are, are posted everywhere.
• 35:10
  Say it, own it, be helpful, build trust, right.
• 35:13
  Simon Speed we talk about all the time.
• 35:16
  I'm not shy about saying like what kind of manager I am.
• 35:19
  Like there's a founder mode, which is like the theory that
• 35:23
  Elon, Jeff Bezos, the Airbnb CEO, like they're all about
• 35:29
  founder mode, which is, hey, they believe in getting into all
• 35:32
  the details and then zooming back out and being like direct
• 35:35
  communication and not this hierarchy.
• 35:38
  And them as CEO, like they can jump into anything.
• 35:41
  And I think in development you have to know everything, because
• 35:47
  when you don't know everything going on, that's when stuff goes
• 35:51
  sideways. Yeah, because you really lose
• 35:54
  control and you can't step in to fix it.
• 35:57
  That's what I felt when I was doing construction.
• 35:58
  I'm like, I don't know how to put this glass commercial door
• 36:02
  in or whatever. Like I have to rely completely
• 36:04
  on other people and I don't have the answers.
• 36:06
  And that was a very, very bad place to be.
• 36:09
  Yeah. And how?
• 36:11
  Who was the first key hire that you made other than your?
• 36:13
  Mom, obviously there's been different people over, you know,
• 36:18
  different time periods like Jeff Carpenter has been a best friend
• 36:22
  and A and a partner in our business.
• 36:24
  He's been with me for 10 years and like a great person to lean
• 36:27
  on, you know, and you know, very much like me, but like can also
• 36:31
  challenge me. Our attorney who's been he's
• 36:34
  done pretty much every one of our deals.
• 36:36
  Another MVP, I'd say is the chief of Josh, which is my EA
• 36:41
  and, you know, just keeping, I'm super organized, but like, she
• 36:45
  keeps, she has this level of ability to free the noise from
• 36:49
  my set, from my calendar and my life.
• 36:52
  And so like, I think those are the big ones.
• 36:55
  And then obviously finance, and we have a terrific finance
• 36:58
  person and our head of OPS. So like, really our core group
• 37:01
  has been really good and it's taken a while to get there.
• 37:03
  Like, you know, I haven't always been the easiest boss to be
• 37:07
  around. Yeah.
• 37:09
  I can imagine. I mean, no one is every.
• 37:11
  Yeah. But I think like, look, you you
• 37:13
  get to a point where you realize that and I think like my
• 37:16
  learning is, you know, I have calmed down and you know, I
• 37:20
  think too, it's like we're in a way different spot.
• 37:23
  Like the pressure I have now, even though it's much bigger
• 37:26
  from a size of project, and then just the sheer volume, it feels
• 37:31
  so much less because it's like I got this one project that's this
• 37:36
  big versus doing 30 smaller ones.
• 37:38
  And so for me, I would rather today take that one.
• 37:43
  Four years ago, I'd be like, oh, he's an idiot.
• 37:45
  Do the 30 smaller ones. Yeah, yeah.
• 37:47
  Because I mean, conceptually you think that's like an apartment
• 37:50
  complex, right? Well, if one or two goes bad,
• 37:52
  the other ones still go good. But if you have one big project,
• 37:55
  you're screwed if it goes bad. Exactly.
• 37:57
  So and that was my logic. But then you know now you think
• 38:02
  about it, it's like OK, but if I own that one center and it's
• 38:04
  really good real estate, you have an interesting control onto
• 38:08
  the tenants and the replacement and the merchandising and adding
• 38:11
  value on a much longer term time horizon.
• 38:15
  But we've we sell 95% of our stuff, so which is an important
• 38:21
  thing like how well we turn the capital so fast so.
• 38:24
  Yeah. You're not holding it,
• 38:25
  refinancing and paying people off, You're just turning it.
• 38:28
  Do you regret doing that or you really feel good about that
• 38:31
  model? Nobody ever went broke making a
• 38:32
  profit. Right.
• 38:34
  Yeah, I love it. Yeah.
• 38:36
  So that's been ours because we do high, you know, high debt.
• 38:40
  And so like we need to turn that capital like look, we're getting
• 38:43
  to a point now, you know, we've grown.
• 38:45
  I think we're, we own about $700 million of real estate today.
• 38:50
  And so where we had zero 15 years ago and we don't have you
• 38:53
  know partners. So like we've really taken off
• 38:56
  and so like we will slowly continue to hold stuff, but like
• 38:59
  we'll probably sell off. Hopefully I'll talk to our
• 39:01
  disposition guys, but like hopefully sell 100 to 150
• 39:05
  million this year and probably double that next year.
• 39:08
  These are completed projects that you paid off the debt
• 39:12
  already and. Kept or you're just saying your
• 39:14
  asset value. Gotcha.
• 39:16
  Total asset value. Gotcha.
• 39:17
  And and so these are projects that you haven't completed and
• 39:19
  sold. Necessarily, yeah, they're in
• 39:21
  process or we're holding it, we cash flow it, Persada out in
• 39:25
  surprise is our largest center and it's like a 1.3 million
• 39:29
  square feet. That's insane.
• 39:30
  I was reading about that like the biggest retail center on the
• 39:33
  West Coast in 15 years. Yeah.
• 39:35
  And today at we just got the number one visited power center
• 39:38
  in the state of Arizona and #17 in the country, which that's
• 39:42
  based on cell phone data tracking, which is really
• 39:46
  exciting because it really opens up the doors to we're working on
• 39:49
  another phase out there. And it's really cool to see the
• 39:53
  impact, like the economic impact that that project makes in the
• 39:56
  community. I can only imagine what that
• 39:59
  feels like. How did you start to shift into?
• 40:03
  You said obvious. You said that you had so much
• 40:06
  pressure, like you were in the pressure curve because you had
• 40:08
  so many smaller deals. Then you decided to start
• 40:10
  thinking about bigger deals. What did that transition look
• 40:12
  like? How did you start to shift and
• 40:14
  go start building relationships with some larger retailers or
• 40:17
  think about doing larger centers instead of these smaller single
• 40:20
  tenant spaces? Yeah, the the big breakthrough
• 40:23
  and like we had bought in a couple centers, we had done a
• 40:26
  few larger projects at 10 million or a $15 million deal
• 40:30
  here and there. And even today just to we're
• 40:32
  still doing smaller deals like we're closing on AI think we
• 40:35
  just did a Wendy's deal and you know Washington that might be a
• 40:40
  million and a half dollar loan like a really small ground lease
• 40:43
  and we're just leasing it. So we're still doing that
• 40:46
  because I believe that hits that bat like you still got to make
• 40:48
  sure you're ready to swing when, when some an opportunity comes
• 40:52
  up. But our large project that we
• 40:55
  got in front of was Prasada. And that's literally been the
• 40:59
  single hand that that really launched us to a new place.
• 41:02
  And because in 2019 when we started working on it and then
• 41:05
  into COVID, like nobody was building centers of that size.
• 41:09
  And so I think we from the relationship side, we just
• 41:12
  started talking to these tenants and nobody was talking to these
• 41:15
  tenants about new construction. Everything had been like, oh,
• 41:19
  I've got a vacant box, you want to backfill it.
• 41:22
  And so, oh, wow, everyone was excited because like, oh,
• 41:24
  somebody's going to build something.
• 41:26
  And so that's how that conversation started.
• 41:29
  And we've really been able to take that and just amplify that
• 41:33
  across. And I think, you know, building
• 41:35
  through COVID and these retailers seeing you do that.
• 41:38
  And like, I mean, that was, that was a tough period of just how,
• 41:42
  how incredibly difficult everything was.
• 41:45
  And then you look at where rents are, rents for, you know, on a
• 41:49
  junior box, so 15,000 square foot tenant were 14 bucks, 13
• 41:53
  bucks back then. Like let's just say today
• 41:56
  that's, you know, at least 50% more.
• 41:58
  Yeah. And so it's crazy in that amount
• 42:01
  of time just how much everything's changed across the
• 42:05
  whole industry. Right.
• 42:07
  Were you, where were you at in the process when COVID hit with
• 42:09
  that project? We just signed the contract and
• 42:12
  so yeah, I was like, ah. I mean it worked out perfect
• 42:16
  but. You know, while we had, we were
• 42:17
  on a time frame and so like luckily our seller was a
• 42:20
  partnership of Red and Meser H and so they were dealing with
• 42:24
  the same stuff that we were. So it's not like they couldn't,
• 42:27
  you know, they were dealing with closures and COVID and all that.
• 42:30
  And so we were able to get more time and restructure the closing
• 42:35
  where we were able to kind of phase it, which was really the
• 42:38
  genius like go back to creative deal structuring that allowed us
• 42:42
  to take it down in pieces. So that way we could get the
• 42:45
  leasing up, get our financing closed, build, build the next.
• 42:49
  So like we phase that out and so that really helped us
• 42:53
  tremendously because I don't know if we would have been able
• 42:56
  to do it if we had to just close on the whole thing and start.
• 42:59
  What was your acquisition price on on the?
• 43:02
  Land, there was 84 acres that we ended up buying at like 7 bucks
• 43:06
  a foot over time. But like I look at like the
• 43:10
  total cost, I think our initial loan was 70 or 80 million on
• 43:14
  that 80, yeah, 80 ish, 90 ish million on the phase one.
• 43:19
  The next phase was 40 million. We just did a another $45
• 43:22
  million phase and our last phase is probably about 45,000,000,
• 43:27
  yeah. So what do you?
• 43:29
  Think 70 million was the last. What do you think is the all in
• 43:32
  cost and and what the value of the the project will be at
• 43:35
  completion? Is it completed yet or not?
• 43:37
  Yet most of it is, it's probably about 85 like this.
• 43:40
  You know, good chunk of it is we're opening up Nordstrom Rack,
• 43:43
  DSW, Old Navy. We just signed a lease with
• 43:45
  Sephora and Target just opened and we've got a, so there's like
• 43:50
  a, a component that is coming. And then we've got another phase
• 43:53
  that we're getting ready to roll out total NOI when it's done.
• 43:57
  Oh, I would say it's probably around 15,000,000.
• 44:00
  And so I've taken everything I told you about breaking
• 44:03
  everything up, spinning it off, threw it out the window there
• 44:06
  and I said I'm going to keep everything together.
• 44:10
  And then different, you know, we have we've recapped that deal.
• 44:13
  And so we brought in a partner who bought in 50% on the
• 44:17
  completed and we like contributed the property into a
• 44:20
  new partnership. So we're able to retire all of
• 44:24
  our MEZ in our construction and we got a life Co loan and got
• 44:28
  somebody to buy 50%. So it's like a really unique
• 44:31
  structure. We're going to execute with
• 44:33
  another group on another piece of it.
• 44:35
  And so we'll control, you know, 15,000,000 of NOI and most of
• 44:39
  the out parcels. And so I think it could be
• 44:43
  really interesting because you look at like a Blackstone, you
• 44:46
  know, or you know, excuse me, BlackRock or whoever that's
• 44:49
  buying, you know, bigger deals. Those used to be the malls and
• 44:54
  nobody's really you know, typically buying that's not a
• 44:56
  hot commodity. But if I can tell you, you got
• 44:59
  hey, 50 million NOI that you can go put out, you know, several
• 45:03
  $100 million in one place. That's that's interesting for in
• 45:06
  a bigger investment manager. Yeah.
• 45:09
  And are you thinking like A5 exit cap on something like this?
• 45:14
  Yeah. I would get like, who knows, you
• 45:16
  know, timing, but probably in the, you know, high fives, low
• 45:19
  sixes. But at that point we'll have,
• 45:22
  you know, depending on when that happens in the future.
• 45:24
  But also we're not in a hurry. We've got very we've got long
• 45:28
  term debt. I like, I really like the real
• 45:31
  estate. Like we're not in a hurry.
• 45:33
  And I think that's a really good legacy property.
• 45:35
  We got bonus depreciation on it. So you know, it's going to cost
• 45:39
  me a lot to recapture and and sell.
• 45:41
  So like, that's one that I think you hold your trophies and
• 45:45
  that's to me is our trophy. Yeah.
• 45:49
  So that was a 2019. So that was back when bonus
• 45:51
  appreciation was 100%. Yeah.
• 45:53
  But by the time we completed and put in service, you know, it was
• 45:57
  phased over time. So we got the initial, I think
• 46:00
  you're at 100 and then it went down, you know, a couple of
• 46:04
  times over the last couple of years as we finish different
• 46:06
  phases. I sure hope that comes back fast
• 46:09
  because right it's not looking very good, 20% next year.
• 46:13
  I know, but again, going back you, you know, you just, you
• 46:16
  have to do things knowing like people are worried about
• 46:18
  tariffs, recession and average recession lasts 18 months.
• 46:21
  That's how long it takes us to build a bigger shopping center
• 46:24
  today. So it's like, look, you gotta
• 46:26
  look longer term. Like do you believe in the US?
• 46:28
  Do you believe in Phoenix? Do you believe in the tenants
• 46:30
  you're working on? And all that stuff that's
• 46:33
  happening on a day-to-day? It's just noise.
• 46:35
  How do you navigate these risks with tariffs and and interest
• 46:41
  rates right now? I know so many people that are
• 46:42
  upside down in their projects where there's developments or
• 46:44
  value adds or whatever. How have you mitigated that as
• 46:48
  you continue to develop through these crazy times?
• 46:52
  Well, luckily great question. Retail never got to you know the
• 46:55
  cap rates that multi family and industrial were.
• 46:58
  And so like we've always been kind of that five to six to
• 47:03
  seven handle cap rate group and like our cap rates might have
• 47:07
  moved now 50 basis points. But like our transaction size of
• 47:12
  under, if we're selling off our parcels, like those are still
• 47:15
  sub six, sometimes even sub five, depending on, you know,
• 47:19
  like a McDonald's or a Chase. And so we were able to manage
• 47:23
  because we're turning it so quickly.
• 47:26
  Like we were, Hey, we're just, you know, we're it's we're not
• 47:29
  like figuring like, oh, we're going to raise rents and sell at
• 47:31
  A at a four and a half. Like I thought that was all just
• 47:34
  kind of magic hocus pocus. That was all financial
• 47:37
  engineering. Like I've always seen that cap
• 47:40
  rate should be in that, you know, mid to high, 5-6 low
• 47:44
  sevens, depending on what it is. And that's where things have
• 47:47
  really kind of shaken out. And so when we underwrite our,
• 47:50
  you know, costs, you know where we want to be on a return metric
• 47:55
  to, you know, where we need NOI to cost, like we've been able to
• 47:59
  be in a pretty good spot. And so I think, look, when
• 48:03
  you're over, I think just don't get too far ahead of your ski
• 48:06
  tips, right? Make good decisions, especially
• 48:10
  early on if you're trying to do development because 1 bad
• 48:13
  decision early on can really set you back versus you Fast forward
• 48:17
  250 deals. If you make a couple mistakes,
• 48:20
  you got some room. Yeah, to pay for it.
• 48:23
  It still sucks, but you know you have room to pay for it.
• 48:26
  What are some of the biggest mistakes that you made or that
• 48:28
  you have seen other developers make in their businesses or in
• 48:32
  their projects? I think just not being in the
• 48:35
  details, that's a big thing. And and for me or for everybody
• 48:39
  else is just not being in the details.
• 48:42
  And sometime, you know, pigs get fat, hogs get slaughtered when
• 48:46
  you have a deal to sell. Like there's some I should have
• 48:48
  just taken that cap and you wait sometimes.
• 48:51
  And I think just being realistic and you know, our business is
• 48:54
  such an emotional business. It's such an emotional roller
• 48:57
  coaster is sometimes don't send that e-mail, don't make that
• 49:01
  quick reaction. And you know, just today I kind
• 49:04
  of had, you know, mini breakdown for and I literally was like off
• 49:08
  the phone. I was like, oh, that that was
• 49:10
  that was not who I wanted to be called back and apologized.
• 49:13
  Like, Hey, rough day or rough moment, you caught me.
• 49:17
  And I think I wish I would have been doing that before.
• 49:20
  And so like, you know, looking back and making just that
• 49:24
  constant assessment and you know, I've really tried to ask
• 49:27
  after each call, like we just had a call with our national
• 49:31
  retailer today and after the call I asked my team how did I
• 49:33
  do? Right?
• 49:34
  Like what did you think? Any feedback?
• 49:36
  And just, you know, so that you get that constant, you know,
• 49:40
  hopefully improvement. Yeah, yeah.
• 49:43
  The emotional intelligence aspect and the awareness of
• 49:46
  yourself and the connection to yourself and being able to
• 49:49
  manage your responses and your tone and like every little thing
• 49:53
  is I think one of the biggest attributes to success that
• 49:56
  anybody could possibly have. It's so important.
• 49:58
  And you do meet like the really asshole people that I've just
• 50:01
  made it through fear force in life, but.
• 50:05
  There's people, there's cats that have more than 9 lives.
• 50:07
  Yeah, yeah. Yeah, exactly as a pretty,
• 50:12
  pretty incredible. So on the, I guess like in the
• 50:16
  underwriting, because this is what always scares me, right, is
• 50:18
  how do you underwrite a deal to not be overly risky because you
• 50:24
  have to assume, well, what if the cap rate drops, you know, in
• 50:27
  three years or five years when this is developed?
• 50:29
  Or what if are you are you only doing debt that's fixed rates
• 50:33
  through your development project are?
• 50:34
  You, it's all floating because the construction it's very hard
• 50:37
  to get fixed because you know what, what's your draw schedule?
• 50:41
  So we're always on floating. So for plus whatever.
• 50:45
  And so how do you navigate like right now when rates have gone
• 50:48
  from 3:00 to 6:00, how I mean that's a massive effect to the
• 50:53
  project. So how?
• 50:54
  How do you navigate that? Well, the cap rate hasn't
• 50:56
  changed as much. And so yeah, going up our
• 50:59
  interest, you know, went expense went way up because you went,
• 51:02
  you know, so for, you know, nothing, right?
• 51:05
  You're paying 3%, you're all on floors on your interest rate.
• 51:08
  And then you went up to, you know, 8 high sevens, I guess,
• 51:12
  depending on if you were on sofa or prime.
• 51:14
  But now costs have come back, they've been stable for a while.
• 51:18
  You know what your interest rate exposure is.
• 51:20
  And so how do we navigate it now?
• 51:24
  It's really like underwriting the real estate.
• 51:27
  It's got to be good real estate, underwriting the tenant credit,
• 51:32
  be very like, we're very picky on that.
• 51:34
  And then, hey, where do we expect, you know, where is the
• 51:38
  worst case that this deal could move to And if you have good
• 51:40
  credit that cap rates not going to move that much unless there's
• 51:44
  some crazy thing that happens to that retailer.
• 51:47
  But like, are you worried about McDonald's credit in the next
• 51:50
  year? Like, they've had some bad news,
• 51:52
  you know, bad earnings results, whatever.
• 51:54
  But like, again, looking long term, nobody's worried about
• 51:57
  McDonald's because, you know, it's a drive through and it's
• 52:00
  good real estate. And it's backed by the fat
• 52:02
  American there, the people that love hamburgers, the fat people
• 52:06
  in the world. Yeah, Yeah, I know.
• 52:07
  Yeah. That that makes a lot of sense.
• 52:09
  I for the interest rates are there and then with tariffs and
• 52:14
  then increasing construction costs, I guess like how much
• 52:16
  wiggle room do you have in a deal?
• 52:18
  I mean, if, if rates go up significantly, you still have
• 52:21
  enough room in the deal that you're going to come out OK as
• 52:23
  long as the cap rate holds steady.
• 52:25
  Yeah. We, we try to make sure there's
• 52:26
  sufficient margin and I think some of the stuff we wait on is
• 52:29
  like, hey, you kind of get, that's why you do most of your
• 52:32
  pre leasing and then you wait on some more, your high margin
• 52:36
  leasing, which would be out parcels, some of the shop
• 52:38
  tenants. So if you need to really push
• 52:40
  for rent or you need to restructure those deals, you
• 52:44
  have the ability to do it. But again, like, think about it.
• 52:47
  We are literally like, imagine rolling down the runway, you
• 52:50
  make your LOI, you just start, you know, you're getting your
• 52:53
  speed and before you actually have to take off, you know your
• 52:56
  contract price, you kind of know where the market is.
• 52:59
  You have a lot of information before you have to pull back.
• 53:04
  And so like, I don't look at it as as risky because we have the
• 53:07
  entitlements done and we have a survey, we have a title
• 53:10
  commitment, we have a lender, you know that that's willing to
• 53:13
  borrow. We have all these sign leases
• 53:16
  where our risk is all right, Our contractor doesn't do a good
• 53:20
  job. So that's the biggest risk,
• 53:22
  right? That's the majority of the the
• 53:24
  cost that you have to manage. And so that's really where you
• 53:29
  can go wrong. Or two, you find something on
• 53:31
  the site, or three, you know, the world ends or there's some
• 53:34
  huge economics collapse and then most people are kind of screwed
• 53:38
  anyway. So like, we'll figure it out.
• 53:41
  Yeah, I was reading that you have said there has been
• 53:45
  multiple oh shit moments in your career and especially through
• 53:48
  COVID and some of these major fast, rapid changes in the
• 53:52
  economy and global position and everything like that.
• 53:57
  What are some of those biggest oh shit moments that you've had?
• 54:00
  Oh, there's so many of them. You know, we had a time period
• 54:03
  for like most of them are somewhat construction contractor
• 54:06
  related, whether it's building in COVID and like just oh shit,
• 54:11
  how are we going to build and oh, the prices are way higher
• 54:14
  and trying to keep that deal going and how do we figure it
• 54:20
  out because we're locked on leases and how do we make
• 54:22
  everything work? We had a contractor that was
• 54:25
  moving funds from one project to the other and forging like lien
• 54:29
  waivers. And so like we really cleaned up
• 54:32
  our process on how to verify. And so like there was a bunch of
• 54:35
  liens on a project and we had paid the money, but the Subs
• 54:40
  never got the money because, you know, so it all got worked out.
• 54:44
  But that was one. And then, you know, last fall we
• 54:48
  fired a contractor off of multiple jobs just for non
• 54:51
  performance. And you know that we're in, I
• 54:54
  think we're in litigation on that.
• 54:57
  But again, that was something we can do better job of picking the
• 55:03
  people we work with and that goes through our vendors, that
• 55:06
  goes through our employees. Like how do we set a higher
• 55:09
  standard? And I think when everyone was
• 55:11
  busy, standards dropped. It's hard to really be as detail
• 55:17
  oriented and on top of everything when you're just
• 55:19
  crazy busy and underwater and all that stuff.
• 55:22
  And you just got to have that sixth sense like, oh, something
• 55:24
  seems off, right? And be ready to act and just
• 55:29
  again move fast. Did you hire ACOO?
• 55:33
  Like did you kind of hire from the top down where once you're
• 55:35
  ready you hired ACOO or did you hire, you know, director of
• 55:39
  operations or a operations manager 1st and then higher up
• 55:42
  from there? My team's going to laugh.
• 55:45
  So Cos never worked with me. So I've, I've had a, a couple
• 55:48
  bouts at trying to make that work, but it doesn't because of
• 55:52
  my directness, like with our team just getting information
• 55:56
  and moving. And I feel like a lot of Cos
• 55:58
  want to put a like a wall between the CEO, founder and the
• 56:02
  rest. And that doesn't work.
• 56:03
  And so VP of operations has been with us for I think five years.
• 56:09
  And so she knows me, she understands that.
• 56:11
  And so she's not trying to get in way of Josh speak or Josh
• 56:16
  mode. She's just trying to be
• 56:18
  collaborative and help us move forward the goals.
• 56:22
  And so the way I kind of look at it is I've got, you know, my
• 56:25
  four key execs and like I get all the information from them
• 56:29
  and then I have my next, you know, layer of PMS. But like I
• 56:34
  talked to everybody, I'm very like, hey, go around, what do I
• 56:37
  need? Let's go over this.
• 56:38
  And so, you know, I think ACOO is probably something that you,
• 56:43
  you know, most companies do need, but it doesn't work with
• 56:46
  my the way I like to manage. Yeah.
• 56:49
  And you have your, your VP of OPS, is that what you said?
• 56:53
  Yeah, VP of OPS that helps you. And but that's we never really
• 56:56
  had operations. We kind of let everyone figure
• 56:58
  it out. I think like that management
• 57:00
  philosophy of that hierarchy is just it's old school.
• 57:04
  Yeah, that's kind of where I'm at in my company right now is
• 57:06
  like, what is how do I structure, you know, the the
• 57:09
  because I don't like the corporate structure.
• 57:12
  But then as you start to grow, it's hard to manage and have
• 57:14
  your finger on the pulse of everybody and everything if you
• 57:16
  don't have some of those layers. So but if.
• 57:18
  You have good people, you don't have to worry about that.
• 57:21
  And if you have your ear to the ground and you have that sixth
• 57:24
  sense in different areas like, oh, I should ask a question
• 57:27
  about that or oh, how's that going?
• 57:29
  And if you have the, the, the systems in place, things, things
• 57:35
  will naturally come together. And I so I, I'd say it's, it's
• 57:39
  the people or the process. Right.
• 57:42
  What systems have you put in place to help you guys scale?
• 57:44
  So we have what we call the Simon systems and so we've got
• 57:48
  our, you know, systems like racy, which is, you know, whose
• 57:52
  roles and responsibilities our log learn as we go, where we log
• 57:56
  loggable moments. And so then we create SOP.
• 57:59
  So we have like what I call the flywheel and it's like, hey, the
• 58:02
  more you know what the flywheel wants to spin, right?
• 58:06
  And every time it hits something, you got to fix it.
• 58:08
  But then if you keep the flywheel spinning, all of a
• 58:11
  sudden you're going to move a lot faster.
• 58:13
  And so like, oh, we made a mistake here.
• 58:14
  Let's add it to the logger. Oh, that was a responsibility
• 58:17
  issue. And so I was very like anti
• 58:20
  process for a long time, but now, you know, we've really
• 58:23
  changed that because it does make for a way better
• 58:27
  organization. And then on technology, we've
• 58:30
  invested a ton in in our own systems.
• 58:32
  Like we have our own platform that we've built off of that has
• 58:36
  integration with art Yardy, which does is accounting
• 58:39
  software and box, which is our file management and DocuSign.
• 58:43
  And so it kind of centralizes everything and has all of our
• 58:46
  information on our projects and it has a link with our, you
• 58:49
  know, additional project management, kind of task
• 58:51
  management software. And so like we're always very
• 58:54
  like, Hey, what's the next thing that we can be doing and being
• 58:59
  on that leading edge, but not first.
• 59:01
  Yeah, yeah. Not first.
• 59:02
  What? What kind of meeting cadence do
• 59:05
  you have with your team? Me personally, I have the Monday
• 59:08
  meetings where we meet as a group of just projects that I
• 59:12
  run and I go through all the projects and just Spitfire
• 59:15
  questions on timing schedule. And then, you know, I meet, I've
• 59:19
  got my one on ones that I do every other week with our kind
• 59:22
  of my key people. But then outside of that, it's
• 59:26
  mostly tenants and you know, project or this project or go
• 59:30
  meet with a council member or, you know, economic development.
• 59:34
  I try to stay pretty. I don't like to be in a lot of
• 59:38
  internal meetings. I'm very much about, you know,
• 59:42
  providing communication and, and getting in and getting out and
• 59:46
  sending, you know, lots of looms.
• 59:48
  My team loves all my looms, which is like a video software
• 59:52
  where you can record your browser and I can record what
• 59:55
  I'm saying. So you don't have to cause a lot
• 59:57
  of things get broken down in communication.
• 59:59
  Like if you text me like, Hey, you're, you're driving, you're
• 1:00:02
  going to give me like 1 sentence, right?
• 1:00:03
  Like you're, you're at a stoplight.
• 1:00:05
  But if you could talk that text, which you now can, you're going
• 1:00:09
  to give me a lot better directions of, oh, turn left
• 1:00:11
  here. And then, oh, watch out.
• 1:00:12
  This person might, you know, not open the door.
• 1:00:14
  And if you use the bathroom, it's at the end of the hallway,
• 1:00:17
  those types of things. And so I think, you know, where
• 1:00:20
  I've really tried to do a good job with our team is, is give
• 1:00:23
  that verbal. But also show them something so
• 1:00:26
  that they get way better instructions from me.
• 1:00:30
  Yeah, yeah, the loom is amazing. And are you because it's because
• 1:00:36
  we're you're an EO, you're a YPOEOI was looking at your your
• 1:00:39
  bio. You've you're part of so many
• 1:00:41
  organizations that have so many awards.
• 1:00:43
  Like how do you have time for anything?
• 1:00:45
  I've been a masterful quitter. So I've been a part, but like
• 1:00:48
  I've been like, my thing is just say no, you know, now I have two
• 1:00:53
  young children. I'm turning 40 in August, which
• 1:00:55
  is a crazy milestone, but you know, I really want to be around
• 1:00:59
  and my children and I know that like this is the time like under
• 1:01:02
  three to make that impression. And so, but why PO while EO, I
• 1:01:06
  was in, why PO and EO have been amazing and currently YPO like
• 1:01:11
  I, I love it. And I think like any of those
• 1:01:14
  groups, like a mastermind group, but the YPOEO experience and
• 1:01:18
  being in a forum where you can kind of just put all your, you
• 1:01:23
  know, thoughts, fears, excitement in a group of your
• 1:01:27
  peers because it's lonely at the top.
• 1:01:30
  Yeah. How has that changed for you as
• 1:01:32
  you've continued to build wealth and build a bigger company?
• 1:01:36
  Like the isolation and the loneliness?
• 1:01:38
  It's just lonely in the management because like you're
• 1:01:41
  the CEO, like you're the decision, like you're old.
• 1:01:43
  That's it's your decision, right?
• 1:01:45
  And you can ask your team what they want to do, but ultimately
• 1:01:47
  it's you. Like I don't have a, a, a, you
• 1:01:50
  know, a true, like my 50% partner.
• 1:01:53
  We started this company. I couldn't we would have never
• 1:01:55
  stayed partners because probably wouldn't want to deal with me,
• 1:01:58
  but I have luckily I have a wife, but I think, you know, for
• 1:02:01
  me, it's not the, the, the loneliness or this, it's just,
• 1:02:05
  you know, now for me, I'm just so driven that like I just love
• 1:02:08
  what I do and so like it keeps me moving forward and I love,
• 1:02:13
  you know, it's changed like before we do it for money and
• 1:02:17
  then all of a sudden I at least for me, it's like now it's like
• 1:02:21
  I'm having fun and I'm seeing my team grow.
• 1:02:24
  I'm seeing, you know, us all the the results and like, look, the
• 1:02:28
  money's a great byproduct, but like it's you can't that can't
• 1:02:33
  drive you forever. Right, because once you have a
• 1:02:35
  certain amount of money, it it, it doesn't change your life at
• 1:02:38
  all. No, and and you know, now what
• 1:02:40
  you can do is get back time. And so I'm a big fan of how do
• 1:02:43
  you, you know, buy yourself more time because we all have 24
• 1:02:47
  hours in a day. And so like, how do we just I
• 1:02:50
  live a mile from the office, right?
• 1:02:51
  My my efficiency drive it like is crazy.
• 1:02:55
  You know, we built our house, my car to my closet so I can drop
• 1:03:00
  off my stuff change to before I go into the house, right?
• 1:03:03
  Thinking about like how I'm going to move through the space
• 1:03:06
  and like how are we going to shave, save, shave off a few
• 1:03:09
  minutes here and there. And so like, I'm a productivity
• 1:03:13
  hat like nerd about those things.
• 1:03:15
  I love that Yeah, I I'm the same, but did you read that book
• 1:03:18
  by back Your time? It's so good and 10X is easier
• 1:03:21
  than two X Oh yeah, so good. So good.
• 1:03:24
  Who? Not how?
• 1:03:25
  Yeah, life changing. Yeah, I've, I read that and you
• 1:03:30
  know, now my assistant does all my emails and all my personal
• 1:03:34
  errands. I haven't been to grocery store
• 1:03:35
  in years. I haven't done e-mail yet.
• 1:03:37
  That's a, that's a bridge for me that like is, I don't know, like
• 1:03:41
  the e-mail thing to me, I just haven't, I haven't been that
• 1:03:44
  accommodating to my assistant to let her in in on that.
• 1:03:47
  Yeah, well, it's like you still have your box that you have to
• 1:03:50
  do, but you it's filtered through so you're not.
• 1:03:53
  But it doesn't bother you that you don't see everything, just
• 1:03:56
  to know a little bit about everything.
• 1:03:57
  Well, if it's just a little bit of, I mean she covers.
• 1:04:00
  So we do a one hour meeting every day, me and her, and she
• 1:04:03
  goes through any emails that came through or any requests to
• 1:04:06
  schedule or podcast requests or things like that.
• 1:04:08
  So I have a finger on the pulse, but when it comes down to the
• 1:04:11
  responses and the replying and the scheduling and the saying
• 1:04:14
  no, like she handles all that. And also I'm really bad at
• 1:04:17
  saying no. So she helps me say no because I
• 1:04:19
  have that gatekeeper. And if it were up to me, I would
• 1:04:22
  just say yes to everything. But I don't have time.
• 1:04:24
  So it really helps. But yeah, I still have the
• 1:04:26
  finger on the pulls. It's not like I don't know what
• 1:04:28
  is going on. I still.
• 1:04:29
  See, I would love to give up the e-mail, don't get me wrong, but
• 1:04:31
  like I just, no, I couldn't. Yeah, yeah, I think it's really
• 1:04:36
  hard for some people. But I mean, it saved me 2-3
• 1:04:39
  hours a day. It saves me just having her in
• 1:04:41
  my box managing stuff and and in my, you know, social.
• 1:04:45
  Media so I unsubscribe to everything so at least I don't
• 1:04:47
  get my junk mail has gone to like where it would get like 500
• 1:04:51
  a day to another. Yeah, I just, I literally just
• 1:04:54
  decluttered. And so one goal I had this year
• 1:04:57
  was to cut 15% of the noise in my life.
• 1:05:00
  And so that was a big chunk of it.
• 1:05:02
  That was I think just the the anxiety of like getting out of
• 1:05:06
  something. I mean like even if it's just
• 1:05:07
  junk, it's in there, right? It's like got to check something
• 1:05:11
  off the list. And so that was that was a big
• 1:05:13
  one for me. Yeah, that's a big one, getting
• 1:05:15
  rid of all the junk. But yeah, pace Morby.
• 1:05:18
  Do you know, I don't know if you know if pace Morby, he's a
• 1:05:21
  bigger like residential guy and investor and has the sub two
• 1:05:24
  community, but he told me something his EA every single
• 1:05:28
  year at the end of the year, she goes through his whole calendar
• 1:05:31
  and and makes a list of 100 activities that he's doing and
• 1:05:35
  her goal is to get 80 of them off calendar.
• 1:05:38
  And so every year just more efficient, more efficient
• 1:05:40
  driving him to one of my mentors.
• 1:05:42
  I actually interviewed him last week.
• 1:05:43
  He's, he's a billionaire and I was asking him some things and
• 1:05:47
  he said, what part of the arrow kills the animal?
• 1:05:49
  And it's the point. And I, I've said this multiple
• 1:05:52
  times, but it's like as much as you can get closer and closer to
• 1:05:55
  your point, like your highest and best use of time, your true
• 1:05:57
  gift that nobody else can do but you, where that's all you're
• 1:06:00
  doing. And everything else gets
• 1:06:03
  delegated to people where that's their point and that's their
• 1:06:05
  best thing. And so I always think about that
• 1:06:06
  is like, what can I take off my plate so I can, I mean, my point
• 1:06:09
  is the relationships like this, I can't have my assistant or
• 1:06:13
  anybody else come sit here right now.
• 1:06:15
  And this is also what I love the most.
• 1:06:16
  And this is how I build relationships and learn and
• 1:06:19
  grow. So it's just a different you're
• 1:06:21
  just always thinking about efficiency.
• 1:06:22
  Processes and systems, but I also would add that you still
• 1:06:26
  like, I like to know a little bit about everything.
• 1:06:28
  Yeah. So you're, you're you're kind of
• 1:06:30
  dangerous in like you. And like I know a little bit
• 1:06:32
  about finance, accounting, you know, all these pieces that make
• 1:06:35
  up the whole puzzle because that's where you've got to be
• 1:06:39
  careful as if you have where are your blind spots and making sure
• 1:06:42
  you understand them. And as much.
• 1:06:44
  Yeah, I agree. Like I like to do this type of
• 1:06:47
  stuff, make the deals and but I still like to kind of dig into
• 1:06:51
  some details to be curious like how does that work?
• 1:06:54
  Yeah. Well, and that's part of your
• 1:06:56
  point is knowing the details and that's part of the time that you
• 1:07:00
  you allocate for yourself to dig into that stuff.
• 1:07:02
  And it's a terrible feeling to not know to not know how to do
• 1:07:06
  something or not know what's going on in some aspect or
• 1:07:09
  sector of your business. And that's where the processes
• 1:07:11
  and systems is so amazing because like I use monday.com
• 1:07:14
  have been working on building that out and fixing it over time
• 1:07:16
  and really make it custom. But when you, you just open it
• 1:07:18
  up and you see a full dashboard of exactly where everything's
• 1:07:21
  at, what, what the stage is in, who's representing it, what
• 1:07:24
  commissions are being paid out or coming in, what's got
• 1:07:26
  cancelled, where the leads are coming from, like on one page.
• 1:07:29
  It's really makes it a lot easier to have that finger on
• 1:07:32
  the pole so you don't be able to click on anything.
• 1:07:34
  And systems are so important. And I right now through EOI was
• 1:07:39
  introduced to EOS and I've implemented EOS in my business,
• 1:07:42
  but I'm like, I don't know how much I love it.
• 1:07:44
  And I'm trying to kind of figure out that that structure, you
• 1:07:47
  know, what's, what's enough structure where we're all on the
• 1:07:50
  same page, but it's not so overly structured where you're
• 1:07:53
  just doing it because of the structure.
• 1:07:54
  And so that's why I'm really curious about how your operating
• 1:07:57
  system sounds like you invented your own, which is.
• 1:07:59
  Amazing. It's been good.
• 1:08:01
  And the EOS, like we've looked at it and implementing it and it
• 1:08:05
  just didn't work because we had a lot of those systems and those
• 1:08:08
  measurements. And so but, you know, having
• 1:08:10
  that coach like they offer and we have somebody that we've
• 1:08:14
  worked with for years that's been great and really holds that
• 1:08:18
  bar and acts as like that voice of reason.
• 1:08:20
  He's almost kind of like our chairman in a in a sense,
• 1:08:23
  because he'll meet with my direct reports and he offers
• 1:08:26
  like a an ear that I probably don't have.
• 1:08:28
  I don't and don't have time to. And so I think that's really be
• 1:08:32
  curious about that. And hey, where, where that can
• 1:08:35
  lead your business. And yeah, maybe in a year you're
• 1:08:37
  like, oh, I don't need that, but it'll probably challenge you to
• 1:08:41
  get to that next level and get thinking about the systems that
• 1:08:44
  like, oh, I didn't really think about this this way.
• 1:08:46
  Yeah, Yeah. It's interesting.
• 1:08:47
  And that's the stuff I don't like, like like the operational
• 1:08:50
  detail. Sitting in 1/2 a day meeting,
• 1:08:53
  planning meeting like nails, chalkboard.
• 1:08:56
  I just want to create. I just want to go create.
• 1:08:58
  That's all I want to do. But be an artist.
• 1:09:00
  But in business, what is the biggest set back that you've
• 1:09:06
  had? All right, Has there ever been a
• 1:09:08
  rock bottom moment in your life where you're just, I don't know,
• 1:09:11
  like didn't know you can make it or or just that feeling of oh
• 1:09:15
  shit, this is. Rock yeah, like there's probably
• 1:09:19
  always the times like where we had a period where contractor
• 1:09:22
  didn't pay the others and not like a but like kind of a no
• 1:09:26
  shit like what are we going to get done?
• 1:09:29
  And I just remember working like it was in December of, I don't
• 1:09:32
  know, it's probably 2015 maybe. And I just remember working
• 1:09:36
  through no time off on those two weeks, right?
• 1:09:39
  I was in the office all day, Christmas Eve, Christmas, like
• 1:09:42
  trying to figure it out and like, how are we going to get it
• 1:09:44
  done? But like, I never thought like
• 1:09:47
  it was going to be the end. I was like, oh, maybe I'm
• 1:09:50
  walking on, you know, hot coals. But I knew I was going to figure
• 1:09:54
  it out. And I think just having that
• 1:09:57
  like just sheer tenacity and like, I'm going to get this done
• 1:10:02
  worked for us. Like it might not always work,
• 1:10:05
  but we've been fortunate. We're outside of that.
• 1:10:08
  You know, we have not had those, those real existential moments,
• 1:10:14
  you know, little moments. I'm always afraid of stuff like
• 1:10:17
  I'm, I'm afraid of everyday. I'm like, oh crap, we need to
• 1:10:20
  watch this or oh, we need to be careful of this.
• 1:10:22
  And I and I think if, if you're not, then life like life's kind
• 1:10:26
  of boring. It is.
• 1:10:27
  What else is there to do if you're not playing the game?
• 1:10:30
  Yeah. It's such a fun game.
• 1:10:32
  It's a crazy game, but it's. Real life monopoly.
• 1:10:34
  Yeah, it what? What?
• 1:10:36
  Oh, I know we got to wrap up here, but what, what's the
• 1:10:39
  future for Simon's theory? What drives you to keep going?
• 1:10:41
  What are some of these goals that you're working on?
• 1:10:44
  Or or Yeah, what's next? So we've done about billion 2
• 1:10:48
  and development in 15 years. In the next year we'll do 500
• 1:10:51
  million. So it's a big and it a lot less
• 1:10:56
  projects. It's not going to take 300 to
• 1:10:57
  get to that point. And so for us, it's this hockey
• 1:11:00
  stick of of doing it. We're executing now.
• 1:11:03
  Like I'm super excited to see our team and really watching our
• 1:11:06
  team grow and execute. And you know, for us, you know,
• 1:11:10
  we've had a real reset in our the marketplace in a good way of
• 1:11:13
  like, oh, wow, these guys are doing this stuff and they can
• 1:11:15
  execute. So it's really cool to see our
• 1:11:18
  team doing it and then just seeing the impact of, again, it
• 1:11:21
  sounds, you know, maybe cheesy, but like it's awesome to go into
• 1:11:25
  A and watch people having, you know, celebrating an anniversary
• 1:11:28
  or having dinner, you know, getting a picture and be like,
• 1:11:31
  oh, the store is amazing. And so it's really cool to see
• 1:11:34
  that. I think for me it's, you know,
• 1:11:36
  how do I make my time, you know, really a special with my family?
• 1:11:40
  And so like my time at the office during this period of the
• 1:11:43
  day, how do I make that effective and helpful and help
• 1:11:46
  grow our team? Amazing.
• 1:11:48
  Well, I'm super excited to see where you continue to go and I
• 1:11:52
  can't wait to go visit your projects too.
• 1:11:53
  That that one here and it's a surprise, right?
• 1:11:55
  Yeah, you know, a little West Side trip.
• 1:11:57
  A little West side. I've only been out there like 3
• 1:11:59
  times in my life but it's crazy. For the growth surprise was just
• 1:12:05
  second fastest growing city in in the state last year.
• 1:12:08
  The growth in this market being in Phoenix like probably the
• 1:12:12
  best in the country, I'd even say better than Texas for
• 1:12:15
  certain reasons. And so it's a great place to be
• 1:12:18
  and I'm excited to watch your growth as well, so.
• 1:12:21
  Thank you. I appreciate you.
• 1:12:22
  Thanks for coming on. Thank you.