Jake & Gino | Multifamily Real Estate Investing Blog
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Episode 4 of the Wheelbarrow Profits series: Rand Partners Podcast where we provide a quick hit of Multifamily education weekly!
Jake Stenziano and Dylan Marma host this sub-series which is designed to educate you in a short period of time, whether on the subway, driving to work, or on a jog. We’ve created this series to give actionable content that is quick and to the point.
How You Can Make Education * Action = Results A Reality In Your Life
One of the huge mysteries for most coaches and teachers is “Why does one student excel with the education provided, while another student struggles and loses interest in the subject?” After reading Know Can Do, I am a lot closer to understanding how unraveling this mystery, and have learned a system on how to instruct a student to implement education, and how to excel at learning and doing!
In this article, I want to share with you the three reasons that the authors Ken Blanchard & Paul J. Meyer expanded upon in their book why students don’t use what they learn. In addition, I will expand upon how to make Education X Action = Results a reality in your life, and how the Jake & Gino community is creating the essential follow up system to put knowledge into action.
Here are the author’s three simple yet profound reasons why we don’t put into action what we learn:
1.Information overload. 2.Negative behavior (stinkin thinkin, superbly expressed by the authors)! 3.Lack of follow up.
Let’s break down each of these reasons and give solutions on how to overcome these impediments.
We are all drowning in information today. Unfortunately, we retain only a small fraction of content when we hear it once, and most of us consume the content and move onto the next book, or video. Can you remember the book you read last year, or even last month? So, the question is, how do you defeat information overload?
First, I would find out what type of learner you are. Are you visual, auditory, or kinesthetic? Do you need to watch videos, read a book, listen to an audio, or actually do the task. This is crucial, and the main reason why many children under perform in school. Just ask Jake! When he found out he was a kinesthetic learner, it was as if a weight was removed from his shoulders. That was his “AHA” moment, and the reason why he disliked school and excelled at sports. The fact is Jake is a pretty brilliant guy and an amazing entrepreneur, but not by school standards. If you want to learn what type of learner you are, simply go online and Google “type of learner, and a plethora of sites will pop up where you can take an assessment and find out your learning style.
Next, follow the author’s advice by “learning less more”. What the heck does that mean? I actually love this advice for learning how to invest in multifamily real estate. When a student joins our Academy, the content that we provide is overwhelming. We want our students to start out by creating goals, and taking baby steps in the beginning by learning a few key strategies, such as focusing and selecting a market, and beginning to network with brokers in that market. “Learn less more”!
The time will come to learn how to manage the property, finance the deal, underwrite the deal, negotiate the deal, etc. As you can see, if the student dives in and begins to consume all of the content, information overload sets in and the student will shut down. How do I know? I was guilty of information overload years ago, when I began my journey into multifamily real estate.
The key in the beginning is to concentrate on a few key concepts over and over again, what the authors refer to as “spaced repetition”. What you focus on grows, and focusing on a few concepts when you first start out will make it much easier to master the concepts.
Why do students want to learn something new instead of struggling with something that they should master? One word. FUN!!! It’s more fun to “learn” new content, and we trick ourselves into thinking that we are being so much more productive if we continue to plow through new content without mastering the old content.
A person’s thought and state affect how he or she learns and puts into practice the education that is being consumed. Education is simply a change in behavior. If you have learned “how “ to buy and manage an apartment complex, yet fail to buy one, have you become educated on the subject? Nope!
In life coaching, we tackle a person’s limiting beliefs and show how a limiting belief can hold back someone from taking action. If you would like more information on the four energy blocks and how they hinder and hold us back from achieving our goals, click here What Are The Four Energy Blocks!
The solution to a negative mindset is to begin listening with a positive mindset, with:
- No Prejudice - Excitement - Positive expectancy - Note taking - How can I use this attitude
These are all excellent suggestions from the authors. Let’s face it, if you think you can’t buy an apartment complex, you are not excited, you expect to fail, you do not educate yourself and adopt how can I do this mentality, you are DOOMED!
Once you see the task as achievable, and you can see yourself doing it, then chances of success rise dramatically! It’s no wonder once a student buys their first deal, their second deal is not too far behind. It took Jake and myself eighteen months to buy our first deal, but after that first deal, we acquired 200 units within a year, and 1000 units within five years.
A positive open mind sparks our creativity and ingenuity, and we seek out what is correct in the knowledge, and not what is incorrect. You will want to get the deal done, instead of trying to poke holes in the deal.
LACK OF FOLLOW UP:
I have to admit, I am guilty of this third transgression. I am a voracious reader, but am I actually changing my behavior after consuming a book. I am going to follow the author’s advice on follow up. How do we overcome a lack of follow up?
Accountability is the key, whether through a structured coaching and education platform like Jake & Gino, or simply taking notes, going back and reviewing your notes. If you do not follow up, chances are you are going to revert back to your old habits. The power of repetition is key, and spaced repetition allows the content to sink in.
I would recommend you to either join a community of like-minded individuals, or seek out an accountability partner. Those weekly calls are huge in a couple of ways. It forces you to prepare and learn the content, and it gives you a sounding board to bounce off new ideas. I guarantee you that you are more likely to let yourself down more often than letting your accountability partner down.
My follow up routine includes either reading a book, listening to an audio or watching a video, and taking notes. Once I am done with the lesson or book, I will re-read my notes, and begin to transcribe them onto my laptop. I will go over those notes a few days later. I will even read the book again and take additional notes, gleaming information that I may have missed the first time.
If I am researching a specific topic, I will try to schedule a podcast with an expert on the topic. I love interviewing experts, and being able to ask them specific questions. My level of energy is raised, it’s fun, I’m excited, and I feel that I can do it. Learn less more, repetition, and follow up! The keys to retaining the information you just learned.
Thanks to Ken Blanchard & Paul Meyer for writing and sharing their immensely impactful book Know Can Do!! I highly recommend it. It has revolutionized how I am teaching our student base, and more importantly, how I am achieving the ultimate goal of educationà a change in their behavior.
Our goal is to teach students how to adapt these principles, achieve the change in behavior, and ultimately, how to become financially free through buying apartments.
At 4pm on Friday, April 12, I turned off my company-provided laptop and let out a big sigh of relief. Three weeks prior, I had put in notice to resign from my 40 hour per week W2 job as a pharmacist, and my last day had finally come. I am now unemployed…sort of.
Over the past few years, I spent a lot of nights and weekends building businesses.
The first: As a licensed real estate agent in the State of Washington, I focus on helping people purchase cash-flowing investment properties to supplement their retirement, save for their kid’s college or cut their living expenses.
The second: My wife and I co-lead a company that purchases and repositions multifamily properties through strategic renovations that improve the lives of the tenants living there, while simultaneously generating nice returns for the investors. After honing our skills with multiple 2-4 unit properties, we decided it was time to scale up and joined the Jake and Gino Wheelbarrow Profits community to leverage the knowledge and experience of other investors who have successfully purchased and managed thousands of units. We recently completed our first commercial multifamily acquisition, a 30-unit apartment complex with strong value add potential in need of over $330K of renovation.
Needless to say, life had gotten a bit crazy. Being around other like-minded investors and entrepreneurs, helped me decide to transition from being a 10% entrepreneur to being one full time. Here are 5 things that quitting (one) of my jobs has allowed me to do in the past two weeks:
1) Think Henry Ford said, "Thinking is the hardest work there is, which is probably the reason why so few engage in it." He wasn't lying. When I was working two full time jobs, one as a pharmacist and another as a real estate agent, co-managing a portfolio of local rental properties and acquiring my first apartment complex, I was so busy running around and reacting that I had very little time to sit down and think: About goals. About strategy. About systems. The important things.
2) Focus I like to focus on one or two goals and go after them 110%. Before, it was easy to get distracted. There often were not enough hours in the day, and I am the type of person who hates to do a thing poorly. It takes a lot of time, effort and hard work to develop skill sets and gain proficiency. It's tough to put in your 10,000 hours (to gain mastery) if the 24 hours per day are being divided amongst several jobs. I’ve been able to use my time to focus on what is important.
3) Get Organized I ordered a large wall-size 12-month calendar to hang on my wall so I can plan my day, week, month and year. It sat on my office floor for the past 6 months. That changed last week, and I now have a nice visual that displays all the amazing things I get to look forward to over the next year. Next up…organizing my receipts so my bookkeeper does not kill me.
4) Flexibility Part of being your own boss is having control over your time…well, more control anyway. I’m still a husband and father to two kids; you can probably guess who actually has control. Nevertheless, this flexibility has allowed me to start pursuing the 20% of activities that produce 80% of the results. Last week, I went to lunch with a real estate colleague who I've referred a lot of business to and knew was interested in getting into apartments. The conversation led to a soft commitment for $500,000 toward our next investment.
5) Feel More Energized A wise man once said that if you can “find the intersection between your greatest passion and your greatest strength, you will feel energized by your work.” I am still in the process of working out my routines and learning how best to structure my week, but I am already enjoying the journey!
It has been an exciting journey so far, and is just getting started. If you are building your real estate portfolio, a seasoned entrepreneur, or just thinking about getting started, I would love to connect with you.
“You gotta walk through the Courtyard to get to the Hammond”
In the winter of 2013, Jake and I purchased our first apartment complex, a 25-unit with tons of “potential”. It had taken us two solid years of rejection and negativity to get to this point. We felt as if a weight had been lifted off our shoulders when we assumed ownership, but little did we know that the real work was about to begin.
In this article, I want to show you how to buy your first apartment complex by exhibiting the “Patience, persistence but willing to walk away” mentality and how to locate value-adds in a deal. I want to highlight our progression from a rundown 25-unit to an attractive 156-unit apartment complex using the identical investing framework.
How To Buy Your First Twenty-Five Unit Apartment Complex - SoundCloud (553 secs long, 506 plays)Play in SoundCloud
On our first deal, we were unfamiliar with Cap Rates and Cash on cash returns, two benchmarks that we utilize when analyzing a deal. Our experience with commercial loans was minimal, and managing a “big” property was foreign to us. To sum it up, we were the classic newbies that lacked experience but more than made up with enthusiasm and the will to work. We thought we were buying the Taj Mahal, yet in reality the property was a mixture of cottages, duplexes and a six-unit motel.
Jake affectionately termed the property “The crack den,” and not because of all of the deferred maintenance.
The apartment complex did contain multiple value-add opportunities. What’s a value-add? A value-add is an improvement that adds value to a property by increasing its cash flow. A few examples include: renovation, repairs, debt restructuring, vacancy lease-ups, cost savings and instituting revenue generators. These value-add opportunities should all be directed to increasing revenue or decreasing expenses, thereby elevating the Net Operating Income of the property.
Where were the value-add opportunities in the Courtyard property?
Let’s begin with the perception of the property, which was originally called The Shamrock Motel. Its reputation to the community was an undesirable property that catered to weekly renters, and would rent to any potential tenant that had a pulse. We set out to reposition (fancy word for fixing a property and creating value) the tenant base and institute a system to screen tenants. This would allow us to dramatically reduce our “turn” costs when a tenant vacated and would secure a more stable revenue stream.
These better tenants would stay longer and actually pay the rent every single month. Evictions and tenant damage dropped almost immediately once we began to screen the tenants. The perception of the property changed within the first year, thus allowing us to attract much better tenants.
We knew we were on the right path when the mail lady told Jake she felt safe once again delivering the mail to this quaint community.
The next area we targeted was the expense side of the equation. We realized the expenses of the apartment complex were running on the high end. Our mistake was our ignorance in what it would cost to run a multifamily property. We just knew that certain bills appeared rather large. We immediately contacted the garbage company and the phone provider. The cost of both of those services was slashed overnight. Next, we decided to remove the cost of cable and required the tenants to pay for their own cable. This single cost-saving step saved us over $6,000 per year.
We also placed a cap on the use of the tenant’s utility usage. We would pay for the first $100, and the tenant would be responsible for the remaining portion. It’s amazing what happens to utility bills when tenants share in the responsibility.
Our value-adds did not end there. We were just getting started. It was time to address the income side of the balance sheet. First, we cleared out the sheds on the property and began to rent them out as storage sheds. This added value two ways. One, we were offering an amenity to the tenant by providing additional storage. Secondly, we were able to generate an additional $200 per month. Once a tenant begins to store all of their possessions on your property, those yearly rent increases of 3% will be met with less resistance. It becomes more difficult just to pack up and move out to another apartment.
Next, we began to institute fees. We began to charge late fees, application fees, pet fees and move-in fees. These fees added to the revenue of the property and allowed us to set rules for the community. If you were late for rent, you were going to be charged a late fee. The tenants were witnessing a total revitalization of the property, and some were not very content. The disgruntled ones decided it was time to leave, and we were able to fill their units with happier, more appreciative tenants.
As we were transforming the apartment complex into a profitable business, we began addressing the various deferred maintenance located throughout the property. We tackled the exterior of the property by repairing rusty mailboxes, power washing the buildings, painting the exteriors, planting shrubs and bringing the former landscaping back to its former glory. We also began to repair the units as they came vacant by replacing old floors, painting the interiors, replacing appliances and addressing any other minor issues.
By the end of twelve months, this “mom and pop” was evolving into a business where expenses were being monitored and revenue collection was the focus each and every month. Most newbie investors do not approach investing as a business, but our vision was to build a huge portfolio that would support our lifestyles and create wealth. Real estate is all about the numbers, and the Net Operating Income (NOI) is king in multifamily real estate. Your focus should be on raising the NOI by employing the strategy that has been laid out.
Let’s fast-forward to the present. We were able to secure an appraisal on the property for $825,000, allowing us to extract $160,000 in excess cash. We left approximately $30,000 in the property to finish all of the deferred maintenance, which included replacing all of the roofs and painting the remaining exteriors. The little crack den is currently cash flowing around $3,000 per month, and we have no more of our initial capital invested in the deal.
The path to creating wealth through apartment complex investing has been laid.
Here is a brief summary of the steps you need to take to jump in and get to work:
Seek out properties with multiple value-adds. The more value you can create, the wealthier you will become.
Start to build your real estate team.
Put in offers.
Expect rejection! Exhibit patience, persistence but willing to walk away mentality.
Land your first deal.
Get to work and implement your game plan.
The Courtyard deal gave us the experience and the momentum to continue in real estate. I often wonder if I did not jump into this deal, would I have been able to purchase our most recent deal? Do not underestimate the power of positive action and momentum.
The Hammond was a much larger property than the Courtyard, but exhibited many of the same characteristics. It was bloated with high expenses, the revenue was not being maximized, the property needed some TLC, (tender loving care) and there was an abundant amount of value-adds. The strategy was identical to the Courtyard: buy on actual numbers, implement our repositioning strategy and increase the NOI.
It took us around six months before we actually went into contract with the Hammond. There were a couple of groups ahead of us, and we had given up on the deal, only to have it come back to us because of our tenacity and persistence.
There were several differences between both deals, such as age of the property, condition, tenant base, property class, desirability, but one feature stood out to us. It was the size of the Hammond that excited us. We were able to provide housing to a larger pool of tenants, thereby increasing our ability to generate wealth. Our profits would be magnified once the property was repositioned.
We are about six months into our plan, and the property is chugging along. The property was purchased with $100,000 in monthly revenue collections.
We have expanded the revenue to $110,000 in six months, and estimate that revenue will grow to around $120,000 per month within twelve months. There are three laundry units that are being converted to apartments, as well as increases in rental rates.
Our goal is to achieve a value of $9,000,000 within twelve months, allowing us to refinance the property and extract the capital we placed as the down payment.
To recap, whether you are purchasing a four-unit deal or one thousand units, the focus should be on:
Look for value-adds
Have a plan
Implement the plan
The financing terms on our first were less than stellar. The interest rate was 6%, it was a twenty-year amortization and the term was five years. Compare that to the Hammond: 4.25%, 25-year amortization and one year interest only payments. What is the moral of the story? Expect to make mistakes, learn from those mistakes, course correct and continue to pursue your dream.
My life was filled with several limiting beliefs that were holding me back from attaining success. My first limiting belief was that if you worked hard, you would be successful. I also thought that an element of luck would factor into one’s success. My idea of what a successful life looked like was also very different from what it is now. Little did I realize that most successful people follow a strategy to guide them towards their goals and dreams. In this article, I am going to dive into the five steps you need to take to usher success into your life and provide examples on how I used this framework to achieve my goal of financial freedom.
Here are the five steps:
Know your outcome.
Know why you want it.
Take massive action.
Know what you are getting.
Change your approach until you get what you want.
Know your outcome:
Most of us in life know what we DON’T want, but find it difficult to focus on what we do want. I knew in my heart that I did not want to be stuck at my restaurant. The problem was that I did not know what I did want. My breakthrough came when I was able to focus on what my ultimate goal was: financial freedom and controlling my destiny. When you begin to tell your brain what it wants, that is what you will begin to focus upon.
The Five Step Framework For Achieving Success In Real Estate And Life - SoundCloud (316 secs long, 70 plays)Play in SoundCloud
Here is a simple example of how your brain works. You go to the dealership and decide to purchase a silver Honda Odyssey (I would have preferred a sedan, but not an option with six kids). You leave the dealership, and turn to your wife and exclaim “I can’t believe how many people are driving the Odyssey.” What happened? Your brain starts to pick up information that you have never noticed before.
Begin to focus solely on your outcome, and remind yourself every day. I would write my outcome on my vision board and carry a note with me every day. I wanted to be reminded why I decided upon real estate as a vehicle for financial freedom. It’s pretty difficult to hit a target if you don’t have one.
Know why you want it:
I had a couple of reasons why I wanted to achieve my outcome. I wanted to feel fulfilled in life and I wanted to be a role model to my family. Those reasons fueled my motivation towards success in the multifamily space. I learned the hard way that reasons come first and answers come next. When I began investing in real estate back in 2002, I wasn’t sure why I was investing. I heard it was a “good” place to invest, but I didn’t have a passionate why. As the economy worsened and my displeasure at my business grew, the reason why became clear to me.
Take massive action:
Now that you are focusing on your outcome and have explained to yourself why you want it, it’s time to take massive action. I decided to use my lunch hour during work and any available time though out the day to dedicate to educating myself on real estate. I would often hear comments (especially from mom) that life is not only about work. Take it easy, money isn’t everything.
When you hear these comments, you are taking massive action. I loved what I was doing and it didn’t feel like work. I was excited to wake up and listen to a podcast or jump on a call with my coach. This massive action leads to momentum, and those little victories start to turn into bigger successes.
Know what you are getting:
The term sensory acuity is defined as how good your senses are at doing what they should do. You have to be able to look at what you are doing in an honest manner and assess whether it is working or not. Sensory acuity is also a measure of our intelligence. Intelligence is a measure of the number of distinctions that we can have for something. For instance, a person who has a high level of intelligence in apartment investing would understand cap rates, management strategies, repositioning strategies, commercial financing and market cycles.
If that’s the case, I was profoundly unintelligent when I began back in 2002. I had very few distinctions for apartment investing, and considered it very similar to investing in single-family homes. Learn to become present in the moment, and focus on what’s happening today.
Change until outcome is reached:
This is a difficult step for most of us. We delude ourselves into thinking that we have tried “everything” to achieve our goal, when in fact, we have tried only a few things. Thomas Edison is the prime example of this last step. He was famous for being relentless when he invented the light bulb. He knew his outcome, he took massive action and he performed thousands of experiments before he was successful. I find his mindset truly amazing. After every failed experiment, he would tell himself that he found one more way not to invent the light bulb. In the course of his failed experiments, he discovered other uses and inventions.
I began with a tri-plex, purchased a small shopping center, invested in a mobile home park and bought a mixed-use building. I decided to change my outcome and focus on multifamily properties. If I was unable to change my approach to investing in real estate, then I would never have been able to accumulate 674 units in three years!
Focus on what you want, know why you want it, take massive action, become aware if your approach is working and be willing to change your approach if it isn’t working. I realized that all of the other real estate niches were not working for me, so I decided to change my approach and jump into multifamily investing.
I hope this article has given you a framework to achieving your goals in life.
One of the most popular questions that I get from my students is “Where do I get money for the down payment?” In this article, I am going to discuss one strategy we employ to find that elusive down payment: Owner Financing.
Owner financing is confusing to many newbie investors, as well as seasoned investors. It is referred to by other names, such as seller financing, holding paper and private money mortgage. Owner financing is simply a loan provided by the seller to the buyer. Buyers use this to assist in the financing of their deal, and agree to make installment payments usually on a monthly basis over a specified time frame until the loan is repaid.
Let me give you an example.
In our first deal, we had no credibility and even less money, but we located a property that had potential. The property was listed for $750,000, but had been listed on Loopnet for over two years. We approached the seller and asked if she was willing to hold paper as pat of the down payment. We agreed on a $600,000 sales price, with 10% cash down from us, 10% seller financing and 80% bank financing.
There are several factors that are needed in a deal to be able to utilize this strategy.
You need a motivated seller. We had one, a couple that was burned out and ready to retire.
You need a broker who understands owner financing and can convince the seller to consider it. I would use the word educate rather than convince because there are benefits to the seller.
You need the participation of a bank who is willing to lend money on a deal with owner financing. Our deal met all of these conditions, and we closed on the deal.
We were able to control an asset that was valued by the bank at $600,000 with only approximately $80,000 out of our own pockets. This is one of the main reasons why owner financing leads to achieving massive wealth. Most successful real estate investors have heard of the term OPM, (other people’s money) and by being able to control the most amount of properties with the least amount of money leads to an explosion in wealth creation.
One note: Leverage works in the other direction. If your investments begin to falter, then your losses will also compound.
Fast-forward three years.
We have just refinanced this first deal. The bank appraised the property for $800,000, and we were able to distribute $180,000 to ourselves. The power of leverage allowed us to purchase a property with $80,000 of our own money, and with excellent management, we were able to increase the value of the asset and recoup our initial investment. Our rate of return going forward on this investment is infinite, and that is the goal with all of our investments.
What happened to the note with the seller?
We decided to offer the seller $10,000 if she would extend the note an additional five years. She agreed, and the length of the term of the note was now eight years. Our timing on this refinance may have aided us in the seller’s willingness to extend the note. Christmas was right around the corner, and maybe the seller wanted some cash for Christmas presents. We’ll never know, but it makes for a good theory.
“To create wealth in real estate, create value and think outside the box.”
The most common phrase I hear from other investors is “You can’t do that.” Most people are stuck inside the box. Change your mindset to “How can I do that”, and force your mind to come up with creative solutions.
If we had listened to the naysayers, we would have never landed our most recent deal, a 281 unit $11,000,000 asset with NO money down. The seller offered to hold 20% as the down payment, and the bank provided 80% financing. If you look for opportunities instead of problems, they will begin to appear.
You too can access this wealth building strategy. To learn more, visit our website or contact us.
Please leave us a comment below and let us hear of your success with owner financing. We are always looking for creative and unique ways to expand our portfolio and our lives.
Learn how to analyze a multifamily real estate deal quickly and accurately >> Deal Analyzer
Welcome to the Podcaster’s Roadmap on How To Syndicate Your First Multifamily Property. In this article, we have compiled podcasts, YouTube videos, and articles for any investor who wants a framework on how to syndicate their first multifamily property.
What is the most beneficial way to consume the content in this article? We have designed it so all you have to do is listen to the podcasts and videos in the order that they have been arranged.
We begin with T. Harv Eker, an expert in personal development and motivation. He will set the table on how to prepare yourself for your own personal journey, and will share with you what has made him a huge success in the personal development space and what has brought him amazing success.
We continue with podcasts and videos with thought leaders and investors who are making an impact in the syndication space. We conclude with team members who will be able to provide legal and tax advice on syndication.
So buckle up, and be prepared to learn how to syndicate your first deal!
Syndicate Right Blog Intro - YouTube
1. Secrets of the Millionaire Mind with T. Harv Eker
This show is about finding success by having the “Right Vehicle,” the “Right Knowledge” and the “Right You” to go all the way. It’s about legitimately changing how you were taught to think and knowing that you SHOULD give yourself more by getting rich.
Harv and Jake & Gino dive in deep to the core of how mindset affects the person and spurs them forward or holds them back. This is a deeply affecting episode that will help you examine your limiting beliefs and re-condition yourself to step on the gas pedal on your path to financial freedom!
2. Making The Move into Multifamily With Bill Ham
Bill Ham was a former pilot, but soon realized that flying was not the right path to financial freedom. AS with most investors, he started out buying small multifamily properties, but soon realized that raising capital was the only way for him to scale up to larger multifamily properties. Listen to his story on how he scaled to over 1000 units and created a property management company.
3. Follow The Plan With Ivan Barratt
Ivan Barratt is a multifamily owner and syndicator who specializes in FHA and agency financed projects. Since 2015, Ivan Barratt has raised nearly 30 million in equity and acquired over 2000 units. Currently, his companies manage well over $150 million in assets comprising nearly 3,000 units. On this podcast, he speaks with us about his first syndication, partnerships and habits for success.
4. Buying Right With Vinney “Smiles” Chopra
This podcast’s exciting guest has been fondly nicknamed “Mr. Smiles” for good reason! Vinney Chopra, one of our happiest guests ever, oversees Moneil Investment Group, LLC, and Moneil Management Group, LLC, in addition to teaching through his academies. He has funded over 26 syndications to date!
Vinney has a very inspiring story. From selling books to buying single-family was a journey in itself! He sprung for his broker’s license and consequently, multifamily caught his eye. Vinney gives tips on how to overcome analysis paralysis like he did and to take massive action in raising money and acquiring properties.
5. The Mindset Of An Investor With Dave Zook
One of the few returning guest on our podcast, Dave Zook discusses how and why he started investing in multifamily, and why he got into the syndication game. For Dave, it’s all about team building and creating value for his investors.
6. Blue Collar Marketing Mark Kenney
Mark Kenney, founder of Think Multifamily, is a hustler and seasoned real estate investor in the multifamily mecca of Dallas, TX and now Atlanta, and owns 2700 units!! Mark gives us hos breakdown on how he structures his syndication deals and his favorite ways to add value during renovations.
7. Don’t Lose Money With Andrew Cushman
In 2007, Andrew left his corporate job and began investing in real estate. In this podcast, he shares about the extreme persistence and creative tactics he used to land his first single-family and multifamily deals and then spills ALL of the details about HOW he successfully repositioned the multi-unit! He also shares what he looks for in a market and in a property, as well as a property management company.
8. Snowballing Capital With Devin Elder
Listen to Devin’s take on Buying Right, Managing Right and Financing Right with both single and multifamily. He also talks about how it felt getting into multifamily syndication, his buying criteria, and what his business plan looks like for repositioning a property and getting his investors returns.
9. Balancing Capital & Opportunity With Chris Urso
Chris is another repeat guest on the podcast, and I think you will know why we invited him on again. He is a wealth of knowledge, is passionate about multifamily, and shares his tips and habits that have made him successful in the business.
10. Turning One Deal Into Multiple Deals With Bruce Petersen
Bruce takes a deep dive into that first deal and the strategies that he used to find his investors, finance the deal and running his own property management. At one point, he closed 4 deals totaling 860 units in 18 months. This episode is jam-packed full of ways to add value to your properties and involve your tenants suggestions and treat them well!
11. Navigating The Waters Of Syndication Law With Kim Taylor
Kim Lisa Taylor (a nationally recognized expert in the securities industry) is the founder of Syndication Attorneys PLLC, where she and the other members of the Syndication Attorneys team focus on helping small business owners/developers structure and convey their investment opportunities in a way that will attract private investors, both domestic and foreign. They teach their clients how to use securities laws effectively!
12. Ins & Outs of 1031 Exchange With Len Berkowitz
Len Berkowitz is the Managing Director of Riverside TACS, providing sophisticated international tax advice and cost segregation services to a broad array of clients. He has over twelve years of experience as a tax practitioner, and discusses the pros and cons of 1031s on this podcast.
13. Asset Protection With Scott Smith
Scott Smith is the founder of Royal Legal Solutions. On this podcast, he gives some great advice on how to hire the right professional to advise you on your real estate investments and how to place your assets in an LLC the smart (and unexpected) way. As a real estate investor himself, he has the ability to strategize, compartmentalize and structure legal entities appropriately. Scott warns: there are certain situations in which insurance just won’t protect you! It’s important to use the right entity structure to safeguard yourself.
14. The Go Giver With Bob Burg
If you work in sales whatsoever, you are surely concerned with increasing volume. By being an avid learner, Bob Burg taught himself how to dramatically increase his sales using systems and by building relationships. Thus, ‘The Go Giver’ was born, teaching the foundational concept: Being a Go-Giver is giving value to your relationships.
This podcast will teach you how to create value for your investors and how to think of solving problems for others, thus opening the floodgates of $$$ for your next syndication.
16. Seven Challenges Of Our First Syndication
In this article, I discuss the seven challenges, or difficulties that we faced when syndicating our first deal. To us, syndication added another layer of complexity and unknown that we had yet to experience. My goal is to prepare the reader for what to expect when they decide to join the realm of syndication.
17. Multifaceted Multifamily With Jake & Gino
This episode is dedicated to a big theme for Jake & Gino this year: Multifaceted Multifamily – building a multifamily business with multiple streams of income. Starting as just an investing business, Jake & Gino went on to build out their own in-house property management, design an education platform, and now they are adding another facet to their business allowing YOU to invest alongside Jake & Gino as an equity partner!
The guys tell the fascinating play-by-play story of the last 5 years and how far they’ve come, and hit hard on having the drive, persistence, and out of the box mindset that is vital for multi-faceted success! They even detail how multiple streams of income can be created in other businesses, for example: Gino’s family restaurant in New York.
18. Multifamily Stories: The Investor Dinner
Multifamily Stories - Investor Dinner - YouTube
This was our first investor dinner to begin to raise funds for our first syndication. Get motivated and inspired to step out of your comfort zone and start raising funds for your first syndication!!
It’s time to create your power base, your list of close friends and family members that you can begin to offer the opportunity to invest with you. Next, you will need to select a market to start looking at deals. Once the market is selected, begin to reach out to brokers and start to create relationships with these brokers. When the brokers start sending deals your way, be sure to underwrite them quickly and let the brokers know if you want to pursue it further.
Customer service is often overlooked in the mom and pop business, and my restaurant in New York was no exception. If I had read Never Lose A Customer Again while I owned the restaurant, I may have never. After reading the book, it was a huge AHA moment for me. I quickly began implementing Mr. Coleman’s strategies in our real estate education and property management business, and it has revolutionized our customer experience.
The problem with the mom and pop business, including my restaurant, is the inability to scale the business and implement systems. As Jake likes to say, it’s the I’ma mentality, ( I’ma do this, I’ma do that, I’ma do it all!!) when in reality, it is impossible for the business owner to grow his or her company and deliver a superior customer experience.
Never Lose A Customer Again delivers the ultimate framework for the business owner to create a unique customer experience for their own customers, and stopping business owners from hemorrhaging customers! How does Mr. Coleman achieve this monumental, yet crucial task? By diving into his eight phases of the customer life cycle.
In addition to outlining the customer life cycle, Mr. Coleman presents a step-by-step process for assessing the customer phase, presenting the various forms of communication in each phase (email, phone, present, etc.) and providing tools and techniques to enhance the customer experience. The truly exciting part of his book is that the techniques taught can be used in any business to enrich the customer service.
Let me outline and discuss each phase.
The customer is deciding if they want to engage in business with your company. If you can convey to them that you have the solution they are looking for, they will go ahead with the purchase.
In the property management business, if your leasing agent does not get out of their seat to greet the prospect or answer the telephone properly, then you may lose the sale even before it presents itself. In our business, our leasing agents follow a protocol on how to engage the customer and make sure to return any voicemails within the hour.
The customer admits that they have a problem, and believes that your company has the answer. This is the phase where the sale is made. Unfortunately, Mr. Coleman states that this is the phase where “customer focused initiatives” end. This is the point in the journey where you want to reaffirm your customer’s purchase and prolong the positive feelings from the purchase.
In our business, the customer needs to rent an apartment. Time to start presenting options to your prospect and letting them know why their next home should be with us.
Mr. Coleman refers to this phase as “buyer’s remorse”. Did I make the right purchase? Did I spend too much? Was there a better solution out there? These questions and more fill the customer’s mind, and if you don’t quickly “affirm” their decision to do business with you, then you will have to work extremely hard to get them back into those positive feelings.
The first “major post sale interaction” takes place in the Activate phase. It’s time to start delivering on the promises that were made during the Assess phase! The customer is excited to get started, and it behooves the business owner to get things started off on the right foot.
In the Acclimate phase, the customer learns how your company does business. We, as business owners, are very familiar with how we deliver our product or service. The customer may still be unfamiliar, and may need more guidance than you think. It is your job to onboard the customer properly and get them comfortable with your process, or else they may never turn into a loyal customer.
This is the phase where success is achieved and your customer gets the desired result. If you want the relationship between you and the customer to continue, you must hit this phase. Many customers never reach this phase, and if you reach this phase with your customer, celebrate this achievement together.
The customer “adopts” the business in this phase and is ecstatic to be a part of the company. This is where the customer begins to develop a long-term relationship with the business owner and develops loyalty to the brand. The business owner needs to make the customer feel as if they are a part of an exclusive community. If you can execute on this phase, you will have a customer for life.
I refer to this phase as the nirvana phase. The customer becomes a raving fan, and is sending you over referrals. It is your job to motivate the customer into becoming an “advocate” for your business. Time to work on your referral programs!
Now that you have an idea of the eight phases, you need to go out and buy the book to implement Mr. Coleman’s four-step process to help understand your customers and how you can deliver superior customer service. And the best part is that Joey offers action steps on how to implement his framework and how to get your employees bought into the system.
Our goal is to become the Chick-fil-a of customer service in the apartment investing space, and Joey’s book has given us the framework and the solution to deliver a superior customer experience.
At Jake & Gino, we have created a three-step framework on how to invest in multifamily:
Buy Right, Manage Right, & Finance Right.
We use the analogy of a wheelbarrow, where the two back legs of the wheelbarrow are buy right and finance right. The wheel of the wheelbarrow signifies the manage right portion because this part of the framework is in constant motion, whereas the buy and finance portions are fixed once the investor executes them. In this article, I am going to focus on the manage right portion, and more specifically, how to rent an apartment quickly for top dollar, what mistakes to avoid with your marketing, and the five step leasing process that will ensure you success when advertising your apartment to prospective tenants.
Let’s begin with the five step leasing process:
Greet the Prospect.
Determine the Prospects Wants and Needs.
Select and Build Value in the Unit.
Make the Proposal to the Prospect.
Close the Prospect.
1. Greet the Prospect.
This is the initial stage of the customer experience, and as we have all heard countless times, first impressions are vitally important. A tenant can make a decision within the first few seconds of entering the leasing office if they want to sign a lease and live in your property, or turn around and never be heard from again. RULE #1: Have your leasing agent get out of the chair and come and greet the prospect with a warm smile and a friendly handshake.
I always try to put myself in my prospect’s shoes. How would I feel if I entered the office and the leasing agent was staring at their computer screen chewing a piece of gum and ignoring me? Not good! Your goal is to make the prospect feel important and feel as if you are there to serve their needs.
Rule #2: Answer the phone within three rings, and if call goes to voicemail, make it a priority to call back the prospect within an hour. Your chance of converting a prospect whose phone call was not returned promptly drops precipitously every hour that they wait for a callback.
2. Determine the Prospect’s Wants and Needs
Once you’ve established rapport with the prospect, it’s time to keep your mouth closed and listen to what the needs of the prospect are. Are you dealing with a prospect who is a single dad who has his daughter over every other weekend, or is the prospect wanting to use the second bedroom for an office? Does the prospect enjoy living on the second floor because they feel safer, or do they have problems with climbing stairs?
This is the phase where you need to establish the customer’s needs and try to deliver based on their needs. The single dad would appreciate an apartment with an additional bathroom for his daughter, so if you can direct him to his need, your success rate will skyrocket and you will save yourself time in the process (no sense in showing him one beds).
3. Select and Build Value in the Unit.
Once you have established wants and needs, proceed to selecting a unit and building the value in that unit. The conversation should go “ I’m going to show you this unit on the second floor with a smaller bedroom. It has what you are looking for. Does it match your criteria?” And then, proceed to that unit.
What you have done is listened to the prospect and directed him to what he needs. You have also saved time by not showing him three other units that do not fit his criteria!
4. Make the Proposal to the Prospect.
Armed with a pad and sharpie, begin to write down what the price of the unit is, and any comments that the prospect is saying. For instance, he may comment on the great price, the size of the units, etc. The amazing thing with this technique is that you are generating an offer to the tenant, even though there is no “contract”. You can point to your pad and highlight what you have just written down. Subconsciously, you are closing the prospect in this stage.
5. Close the Prospect.
The last step is easy. Just walk down to the office and proceed to close the prospect. If you walk them through the entire five-step process, you will eliminate the majority of objections from the tenant. Your close rate will rise dramatically, and so will your NOI!!
CLICK THE IMAGE BELOW TO – Download our Resource Guide on How To Manage Your Multifamily properties:
Now let’s move on to two huge mistakes that mom & pops commit when trying to lease their apartment for top dollar.
The first mistake is not having a website to direct the traffic to, and if they do, the website is confusing or poorly laid out. This is our property management website –
Some distinguishing features: The website is easy to navigate, has quality pictures, phone numbers for the office is easy to find, and the tenant portal is also simple to use. The number one priority of the website is to have prospects land there, decide the complex fits their criteria, and pick up the phone and call the leasing office. Voila!! That’s it, job done!
The second mistake that mom & pops commit is that they utilize social media to rent their apartments and spend thousands of dollars uselessly on advertising. Let me ask you a question. Where would you search on the Internet if you were searching for an apartment? The vast majority of prospects will perform a Google search, such as “Rent a luxury apartment in Knoxville”. Social media platforms, such as Facebook and Instagram, can be utilized to build a brand or customer awareness, but unfortunately, when a prospect needs to rent an apartment, the search needs to happen instantaneously and Google is overwhelmingly the preferred method. So save your money, create a Google ad campaign, and decide when you want to advertise your unit. Or better yet, hire a company to help you create an ad campaign.
If you want to find out more tips on how to rent your apartment quickly and affordably, listen to our podcast with Matt Easton from Multifamily Traffic, a marketing company that focuses on generating leads for the apartment owner.
What part of the customer journey are you having challenges with? Please leave a comment below! We are always looking to create a better customer experience with our tenants, and getting feedback from other owners helps us tremendously.
Ready to take the next step in your multifamily journey?
Every human on the planet has six basic needs, and learning these six needs will guide you to leading a more fulfilling and rewarding life. As you will read, the first four needs are considered the “fundamental” needs. The last two are the secret to happiness.
Let’s list the six needs and dive right into satisfying them:
Feeling of Significance
Contribute more to society
As humans, we function at a much higher level when we achieve a feeling of certainty. How would driving a car feel like if you were in constant anxiety of a tire blowing? Your thoughts would be preoccupied with imminent danger, and you would not be able to concentrate on the task at hand. In my life, I have achieved a level of certainty with my family life. I am certain that my wife, who is a stay at home mom, is with the children while I am off in the marketplace trying to “bring home the bacon”.
This level of certainty has allowed me to prosper and become successful in my endeavors. Without that certainty, my progress would have slowed down immensely. I would have thoughts of “What time do I have to feed the baby” or “Did I prepare lunch for the kids”. This certainty has also allowed my children to flourish in their environment. This sense of certainty alleviates stress and fear and contributes to our success.
People choose different types of behaviors to achieve certainty in their lives. Some people smoke, some consume alcohol, some overeat and some people choose prayer as their medium. The key is to find a way to meet certainty with empowering actions.
Now that we have obtained a level of certainty, what tends to creep into our lives? Boredom!! How ironic is it that we all strive for that level of certainty, but once we attain it, feelings of boredom begin to creep into our lives. We all need variety in our lives, something that will keep us on our toes. I fell into this trap with my business. At one point, the job became monotonous and I felt “stuck”. I had achieved a feeling of certainty, but now the juice was gone and I felt as if I was just going through the motions.
We all strive for that feeling of significance, of feeling important and being unique. Some people feel significant by tearing others down, while others obtain significance by helping others. You can feel significant by being smarter than everyone else, by dressing differently, having more titles after your name, or by earning more money. We all choose our actions based on our beliefs to achieve significance. I even know friends who use religion to demonstrate their sense of worth.
While a person is trying to be unique, they still have a craving for connection. This is very common in famous people, such as actors and athletes. They have worked their entire lives to be unique and stand out in the crowd. Once they acquire this uniqueness, they all of a sudden can’t relate to people and lose that sense of connection. You wonder why famous people commit suicide. To us, it appears they have it all: fame, fortune, glory but in reality they have no one to share it with.
Now is where the fun starts. A person will not be happy or fulfilled unless he taps into these final two needs. A person who is not growing is dying. I was stuck in my comfort zone at work, and I felt as if I was dying. I was not learning any new skills, I was not contributing and I felt lost. Once I realized my unhappiness, I was able to create a plan on how to leave my business and start off on a new more empowering life. I always thought if I make enough money to retire, then I’m going to be happy.
It doesn’t work that way. Countless businessmen and women cash out of their businesses, and retire from the rat race. They soon realize that retirement is not all that it’s cracked up to be. They become bored, and they miss that feeling of contribution and growth. So what do they do? They jump right back into the race.
This last need drove me to the profession of coaching. A have an inner desire to help people and to contribute more. I want people to think, “The world would be a better place if there were more guys like Gino”.
We all have a need to contribute to society, whether it is to be a teacher, a volunteer or a businessman. It explains to me why people who stay active after retirement live much longer and more productive lives. Once you stop growing, death begins to set in, your contribution will cease and everything will start to fall apart.
In conclusion, all pain comes from when one or more of our six needs are not met. We all have ways of meeting these needs. You can get certainty by controlling everyone, variety by doing drugs, significance by earning more, and connection through prayer. Learn how to be aware of your needs and take empowering actions to attain happiness.
Become aware the actions you take to meet your six needs. Focus on the positive actions and think of ways for you to contribute and to grow. My joy is to donate my time and treasure to those less fortunate than myself.