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Cliff Notes: CAN GENTRIFICATION BE FLIPPED? · Earn Your Leisure

• 0:00
  Speaker 1: You know, this narrative about gentrification happens over and over
• 0:03
  Speaker 1: and over, and I was like, man, I know.
• 0:05
  Speaker 2: A few of us that are flipping.
• 0:07
  Speaker 1: I don't know anybody that's really trying to get into
• 0:09
  Speaker 1: the development game, and you know, kind of change the
• 0:13
  Speaker 1: narrative so we have some control over that. So twenty thirteen,
• 0:17
  Speaker 1: that's when I decided to kind of get off into that.
• 0:19
  Speaker 3: So what you buying land in twenty thirteen was that
• 0:21
  Speaker 3: the next step.
• 0:22
  Speaker 1: I didn't know what I was going to buy. I
• 0:23
  Speaker 1: just knew what I was gonna do is stop flipping
• 0:25
  Speaker 1: and try to figure it out. So I just started
• 0:26
  Speaker 1: talking about it, and man, it came full circle. That
• 0:29
  Speaker 1: same my same line brother that helped me get into
• 0:32
  Speaker 1: the game. He had an old tenant reach out to
• 0:35
  Speaker 1: him that used to be in one of the properties
• 0:37
  Speaker 1: and say, hey, I'm over here in fifth Ward and
• 0:40
  Speaker 1: the landlord over here isn't taking care of property. I
• 0:42
  Speaker 1: think he's on drugs. And so you know what he
• 0:46
  Speaker 1: heard was opportunity. So he reached out to me and
• 0:49
  Speaker 1: he's like, man, I think we got opportunity to go
• 0:51
  Speaker 1: pick up a few houses over here. So I went
• 0:53
  Speaker 1: to go meet with the guy ended up being a
• 0:54
  Speaker 1: whole block, got a grocery store on it. How that
• 0:58
  Speaker 1: okay true story. At the time this was in the hood,
• 1:02
  Speaker 1: it wasn't worth nothing. It was probably worth three hundred
• 1:05
  Speaker 1: thousand the whole block because everything was kind of run down.
• 1:08
  Speaker 1: But it's in the area where you tell somebody'm about
• 1:10
  Speaker 1: to go to spend three hundred thousand, They're like, man,
• 1:12
  Speaker 1: are you crazy? It's the hood, nothing but drugs and
• 1:15
  Speaker 1: prostitution over there. You're gonna waste your money, you know.
• 1:18
  Speaker 1: So what I ended up doing to talk him in
• 1:19
  Speaker 1: doing the deal, I offered him four hundred thousand for it.
• 1:23
  Speaker 1: So but of course I didn't have the cash to
• 1:24
  Speaker 1: pay four undred thousand. So he actually had inherited the
• 1:28
  Speaker 1: property from his dad. His dad was like a real
• 1:30
  Speaker 1: estate taccoon had like twenty six blocks over there, twenty
• 1:33
  Speaker 1: six blo, twenty six blocks. Who twenty six blocks, And
• 1:36
  Speaker 1: this block happened to be the one that they gave
• 1:39
  Speaker 1: this this uh, this kid, and he was like the horrible.
• 1:44
  Speaker 2: Kid, you know what I mean? He watched it.
• 1:46
  Speaker 1: Yeah, yeah, So so this was the one he had
• 1:48
  Speaker 1: and he still wasn't.
• 1:49
  Speaker 2: Taking care of it.
• 1:50
  Speaker 1: So I offered him owner finance scenario where it's like,
• 1:54
  Speaker 1: I'll give you ten percent now on the finance. So
• 1:56
  Speaker 1: that's when the instead of you, instead of going to
• 1:58
  Speaker 1: the bank, the owner or that actually doesn't have any
• 2:01
  Speaker 1: debt on the property will let you make payments over
• 2:03
  Speaker 1: time to buy the property from them. So I gave
• 2:07
  Speaker 1: him ten percent of what we agreed to the four
• 2:09
  Speaker 1: hundred thousand, so forty thousand dollars which came from me
• 2:12
  Speaker 1: selling one of my rental properties, and then that allowed
• 2:15
  Speaker 1: me now to control that whole block of property and
• 2:18
  Speaker 1: it had the grocery store on it and then had
• 2:20
  Speaker 1: the houses, but everything was really run down.
• 2:23
  Speaker 2: So instead of fixing it up, what I decided to do.
• 2:26
  Speaker 1: Was do parole housing for felons because it's really hard
• 2:31
  Speaker 1: for them to find anywhere to live. So I would
• 2:34
  Speaker 1: rent them out a single room in each one of
• 2:37
  Speaker 1: the houses, charge them three to fifty a month or
• 2:39
  Speaker 1: something that they could afford because of the type of jobs
• 2:41
  Speaker 1: they could get, you know, they didn't have much income,
• 2:43
  Speaker 1: or they like a halfway house pretty much like a
• 2:45
  Speaker 1: halfway house.
• 2:46
  Speaker 2: Yeah, they call them sro housing.
• 2:48
  Speaker 4: And then so the state paid you that right.
• 2:50
  Speaker 1: Sometimes sometimes if it depends on what program they're in.
• 2:54
  Speaker 1: They get some type of housing assistance, but most of
• 2:56
  Speaker 1: the time, no, they had to go get a job.
• 2:58
  Speaker 1: So that's what made it really good, because you talk
• 3:00
  Speaker 1: about a low risk tenant, you got somebody that's happy
• 3:04
  Speaker 1: to be out of prison. They was in prison for
• 3:05
  Speaker 1: non violent offense. I didn't do violent people. They had
• 3:08
  Speaker 1: to keep a job and they had to keep somewhere
• 3:09
  Speaker 1: to stay, and ninety nine percent of the places wouldn't
• 3:12
  Speaker 1: even allow them to live there. So they were like
• 3:14
  Speaker 1: they were like built in good high revenue for me,
• 3:19
  Speaker 1: you know what I mean as collectively in each house.
• 3:21
  Speaker 1: Whereas I could have rented that whole house for five
• 3:23
  Speaker 1: hundred dollars to a regular family, now I'm making eleven
• 3:26
  Speaker 1: twelve hundred dollars off that same house, you know, with
• 3:28
  Speaker 1: this program. And because you were erected in the rooms
• 3:30
  Speaker 1: ndom individual rooms, and most of them had trades, so
• 3:33
  Speaker 1: they were like carpenters, electricians, plumbers. They all earned their
• 3:36
  Speaker 1: trades in prison. So anything went wrong, I just dropped
• 3:39
  Speaker 1: off materials. They were the wind is built in and
• 3:42
  Speaker 1: they were just happy to have somewhere to live, you know.
• 3:45
  Speaker 1: So yeah, so that worked out that was a win
• 3:47
  Speaker 1: win man and then that was twenty thirteen, fourteen fifteen.
• 3:53
  Speaker 1: I did that in twenty sixteen. Redevelopment kind of started
• 3:57
  Speaker 1: in the area that I was in. Something else that
• 4:00
  Speaker 1: I always watched too, even when I was flipping, is
• 4:02
  Speaker 1: what the city's plans were. And you can go to
• 4:05
  Speaker 1: the planning Department's website and it'll tell you what the
• 4:09
  Speaker 1: planning to do five years, ten years down the road.
• 4:11
  Speaker 1: And that's a lot of the game that we don't
• 4:14
  Speaker 1: pay attention to, but you know, the other group's pay attention.
• 4:17
  Speaker 2: Where can you find that information that Usually you.
• 4:19
  Speaker 1: Can just google it, like like like Planning and Development
• 4:22
  Speaker 1: Department or Urban Planning for whatever city you're in, and
• 4:24
  Speaker 1: it'll pull up on that website. You know, it's usually
• 4:27
  Speaker 1: a dot gov type website, and it'll have all their information.
• 4:30
  Speaker 1: A lot of us talked about the city council meetings,
• 4:32
  Speaker 1: so you can look up city council meeting minutes and
• 4:35
  Speaker 1: they'll tell you about anything big, any developer that's proposedness
• 4:38
  Speaker 1: to do something in a certain area. All that has
• 4:40
  Speaker 1: to be public publicly announced. So but what I what
• 4:43
  Speaker 1: I noticed about Houston was like everything was going to
• 4:45
  Speaker 1: counterclockwise around downtown and the fifth one neighbor that I
• 4:48
  Speaker 1: was buying it was the last quadrant, So I knew
• 4:51
  Speaker 1: eventually it was gonna come. I just did don't win,
• 4:53
  Speaker 1: you know, and so yeah, so that's how I got
• 4:56
  Speaker 1: into it. And twenty sixteen is another guy started building.
• 5:00
  Speaker 1: So then I figured it's time for me to try
• 5:01
  Speaker 1: to figure out how to get it done.
• 5:02
  Speaker 4: So what is your all right? So what's your philosophy
• 5:05
  Speaker 4: on gentrification? What's your how do you feel about that?
• 5:09
  Speaker 1: So gentrification has a very negative connotation in our community
• 5:14
  Speaker 1: because we are never.
• 5:15
  Speaker 2: The ones revitalizing that neighborhood.
• 5:18
  Speaker 1: And what happens is the people that are revitalizing are
• 5:21
  Speaker 1: looking out for themselves or their own groups. It's not
• 5:24
  Speaker 1: that they don't care about us, is that they have
• 5:26
  Speaker 1: their own.
• 5:28
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  Speaker 1: Security personal agendas that they're moving forward, and so we
• 8:22
  Speaker 1: can either continue to watch it happen or we can participate, right,
• 8:26
  Speaker 1: and we can participate in the way that we kind
• 8:28
  Speaker 1: of control the narrative of what's being built, who's being
• 8:31
  Speaker 1: built for, and what happens to the surround the community
• 8:34
  Speaker 1: that we're building in.
• 8:35
  Speaker 2: Right.
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  Speaker 1: So, my goal with my project is, you know, most
• 8:37
  Speaker 1: of the time when you hear about black builders in
• 8:40
  Speaker 1: black neighborhoods, it's low income stuff, and I feel like
• 8:43
  Speaker 1: that's great, Like, we do need to look out for
• 8:45
  Speaker 1: the low income people, but we got to attract the
• 8:48
  Speaker 1: people that were successful, to people that made it out
• 8:50
  Speaker 1: those neighborhoods back to those neighborhoods because we need that income,
• 8:54
  Speaker 1: we need that demographic. If we ever want a grocery
• 8:56
  Speaker 1: store to come back. We can't sit and depend on
• 8:58
  Speaker 1: the government to do that. And right now, what happens
• 9:00
  Speaker 1: is the people that are successful, they go and buy
• 9:02
  Speaker 1: houses in the suburbs. Right It's not because they don't
• 9:05
  Speaker 1: want to move back, it's because they have no options.
• 9:07
  Speaker 1: So my focus was, well, let me start building some
• 9:10
  Speaker 1: some market rate stuff, not low income houses and stuff.
• 9:12
  Speaker 1: But try to track these working professionals back to the
• 9:14
  Speaker 1: neighborhoods with a high quality product that they know they're
• 9:17
  Speaker 1: gonna pay the same price they're paying in the suburbs
• 9:19
  Speaker 1: and in the city, your value is going to appreciate
• 9:22
  Speaker 1: a whole lot more, especially when that neighborhood starts to revitalize.
• 9:24
  Speaker 2: And that's kind of what you've done with.
• 9:26
  Speaker 3: You know, the land that you bought in twenty thirteen, right,
• 9:28
  Speaker 3: which is your the most recent development that you worked on.
• 9:30
  Speaker 2: So fourteen it's the fourteen Yeah.
• 9:33
  Speaker 1: Fourteen units individual house townhouses.
• 9:36
  Speaker 2: Yeah, you want to talk about that. How that came about.
• 9:38
  Speaker 1: Yeah, so it's the same property that I bought with
• 9:40
  Speaker 1: the grocery store and everything. So twenty sixteen, I decided
• 9:43
  Speaker 1: to just tear everything down when I saw there's another
• 9:45
  Speaker 1: developer that was building houses deep in the neighborhood and
• 9:48
  Speaker 1: he was selling them for two fifty before they were complete.
• 9:51
  Speaker 1: He wasn't even listening them on MLS. So I'm like,
• 9:54
  Speaker 1: so that tells me that there's a mindset, there's enough
• 9:56
  Speaker 1: people out there are willing to save one hundred thousand
• 9:59
  Speaker 1: dollars because everything else inside the city Loop was like
• 10:02
  Speaker 1: ENTI sixteen Loop was two three fifty or more so.
• 10:06
  Speaker 2: But people would.
• 10:07
  Speaker 1: Rather save that money and live in a neighborhood that
• 10:10
  Speaker 1: was still pretty rough. So I was like, well, if
• 10:12
  Speaker 1: he can do this deep in the neighborhood, I'm right
• 10:14
  Speaker 1: on the feeder to the highway, you know, I got
• 10:17
  Speaker 1: a view of downtown. I should be able to do
• 10:19
  Speaker 1: something with my property too. And so that's when I
• 10:21
  Speaker 1: decided I'm gonna move forward with this initiative to try
• 10:23
  Speaker 1: to build these townhouses.
• 10:25
  Speaker 2: And it took a lot of work. It took me.
• 10:27
  Speaker 1: Building the right teams. I had no idea what I
• 10:29
  Speaker 1: was doing. Goes back to what you're talking about earlier
• 10:31
  Speaker 1: with the consultant. I had to find the right team,
• 10:33
  Speaker 1: the right I had to find a builder that had
• 10:35
  Speaker 1: enough experience that was willing to kind of lend his
• 10:38
  Speaker 1: knowledge and time to me, of course for a fee,
• 10:41
  Speaker 1: you know, had to pay him to be my consultant,
• 10:43
  Speaker 1: basically teach me how to do the first project.
• 10:45
  Speaker 2: But that's what I did.
• 10:47
  Speaker 4: So what's what's your your plans now? As far as
• 10:49
  Speaker 4: how many projects are you are you working on? Like,
• 10:51
  Speaker 4: what's your what's your vision?
• 10:52
  Speaker 2: Looked like? For the next five years.
• 10:53
  Speaker 1: Next five years, I want to finish this project, which
• 10:55
  Speaker 1: would probably be finished next year, and I want to
• 10:58
  Speaker 1: continue to build uh, the same model in the same neighborhood.
• 11:02
  Speaker 1: I kind of want to make this like a real
• 11:05
  Speaker 1: world example that can be duplicated in other cities, like
• 11:07
  Speaker 1: we can go in, we can buy the land. And
• 11:09
  Speaker 1: I didn't mentioned my entire team is from the community too,
• 11:12
  Speaker 1: so like my builders, my real estate brokers, my insurance brokers, everybody,
• 11:18
  Speaker 1: the contractors as well, contractors as well.
• 11:20
  Speaker 2: Yeah.
• 11:20
  Speaker 1: Yeah, I'm working with a black builders, so and it's
• 11:22
  Speaker 1: not just anybody's people that got good reputations, but we
• 11:24
  Speaker 1: kind of always silo ourselves and we never.
• 11:26
  Speaker 2: Really collectively work together on stuff.
• 11:28
  Speaker 1: So yeah, And the goal and the most important part
• 11:31
  Speaker 1: of all of this, whether you're flipping another industry a
• 11:34
  Speaker 1: lot of people in it's whole selling or building new construction,
• 11:37
  Speaker 1: is ensuring that you put the product in front of
• 11:40
  Speaker 1: the right end buyer. Because if you're flipping, you call
• 11:43
  Speaker 1: yourself buying the block. But if you're not watching who
• 11:46
  Speaker 1: you're selling to on the back end, you're still gentrifying
• 11:48
  Speaker 1: the neighborhood. So my goal is really to educate us
• 11:51
  Speaker 1: on like, like I said, the working professional on why
• 11:53
  Speaker 1: it's better for you to buy over here. So I'm
• 11:55
  Speaker 1: building the first three now, got contracts on two of them.
• 11:59
  Speaker 1: Both of them are young, young black professionals, basically all
• 12:02
  Speaker 1: in gas professionals.
• 12:03
  Speaker 2: Townhouses, right, the townhouses.
• 12:04
  Speaker 1: Yeah, I got a dentist, a black dennist from from
• 12:07
  Speaker 1: Dallas that's looking at buying one, you know. So it's
• 12:10
  Speaker 1: all about making sure that we create that model because
• 12:15
  Speaker 1: right now that gentrification narrative is the only thing that's
• 12:18
  Speaker 1: that's that's real and for our people, we do better
• 12:22
  Speaker 1: when we see examples of something that's actually working. And
• 12:24
  Speaker 1: so when this is complete, I want to make sure
• 12:27
  Speaker 1: that this model is as much exposed as possible. It's
• 12:29
  Speaker 1: not about me making all the money. I want people
• 12:31
  Speaker 1: in other cities to do the same thing, you know,
• 12:33
  Speaker 1: to say it's possible, we really can't do this.
• 12:35
  Speaker 2: And this is the example.
• 12:36
  Speaker 4: How do you evaluate like what area you want to
• 12:37
  Speaker 4: I know you say you look at it like the
• 12:39
  Speaker 4: city plans, but do you have like a set formula.
• 12:42
  Speaker 4: It's just kind of like you just know the area
• 12:43
  Speaker 4: and you just kind of have a good feeling because
• 12:45
  Speaker 4: you can't buy in some bad neighborhoods and they don't
• 12:47
  Speaker 4: get better, right, So it's like, I mean, how do
• 12:49
  Speaker 4: you know like this is this is probably going to
• 12:51
  Speaker 4: get better.
• 12:53
  Speaker 1: It's all about your network because you got to be
• 12:55
  Speaker 1: talking to people in the industry. So a lot of
• 12:58
  Speaker 1: the realtors that I work work with, they work with builders,
• 13:02
  Speaker 1: and you know, you gotta have a network of commercial
• 13:04
  Speaker 1: realtors around you too, because they know where the commercial
• 13:06
  Speaker 1: developers are looking at, what areas are looking at. So
• 13:09
  Speaker 1: it's a lot of it's word of mouth in addition
• 13:10
  Speaker 1: to what you see on the city plans, you know.
• 13:13
  Speaker 1: But yeah, you gotta have your foot in the door.
• 13:15
  Speaker 1: You got to be on the inside understanding where they're
• 13:18
  Speaker 1: moving that and you just kind of ride that wave
• 13:21
  Speaker 1: along with them.