How a Podcast Built a 95-Unit Real Estate Empire

I would way rather lose my own money than any investor capital.

So the first 10 or so deals I did, I, I didn't, I wouldn't say I really lost money because I wasn't flipping or wholesaling, but I made mistakes along the way and held long enough to eventually make profits. That's the forgiving part of real estate.

But what I learned is am I going to continue to deploy my capital, Save it up, Deploy it, save it up and eventually run out of your own money or am I going to figure out a way to leverage other people's money, take a less percentage? And what I want people to understand is, is that as a general partner, we're getting paid last and that's okay.

Welcome to Truly Passive Income. I'm Neil Henderson.

And I'm Clint Harris. And today we are joined by Corey Jacobson.

He's a business partner who has built an 80 plus unit real estate portfolio spanning long term rentals, short term rentals, multifamily apartments and a 43 unit multipurpose resort. They also host the Wealth Juice podcast which is ranked in the top 1% globally with where they interview world class investors and entrepreneurs.

What I find fascinating is how they have leveraged that podcast not just for content, but as a deal sourcing and partnership engine that accelerated their entire investing journey. Corey, we are excited to have you here today, sir.

How are you, man? That was one of the better intros I've ever got. Thank you guys so much for having me. That was, that was fun. Yeah, I'm ready to do it.

Third time's the charm. Yeah, well, we'll, we won't tell the listeners that. Listen, Corey, we're excited to have you on. You've got a lot of stuff going on here.

I, I've got a short term rental background myself, a little bit of long term, little bit of multif family. But you guys have moved fairly quickly from long term rental, short term, multifamily.

And now I know you're doing syndication and raising capital as well. So that seems like a quick journey. But tell me where you started, what kind of those projects?

Probably the traditional long term rental and then how it progressed.

Yeah, so as a caveat there, when you don't know what you're good at, you try a lot of different things. Right. So that's what happened with us in the beginning.

And I found that the short term rentals actually ended up being more of like, well this is good for a lifestyle play of a place. You know, I have a place in Tampa, Florida. That I free frequent, I can go down in the winter because I'm in Philadelphia.

But we figured our way of trying to scale short term rentals wasn't possible. So we bounced around from an a a bunch of different tactics.

But to get to the beginning of my story and how it started, I started out how a lot of people do. I was working actually I was working for the Philadelphia 76ers.

I have a basketball background, running their youth camps, making a whopping $35,000 a year.

And I realized I needed to make more money one but the second thing I realized is that I needed to cut some expenses to be able to like just live off of that income. So I bought a three bed, two bath, lived in one bedroom, rented out the other two bedrooms. Very, very simple.

Saved up some money, bought $125,000 duplex, cash flowed 300amonth. Wasn't leaving my job over that.

But 3 years later I sold it for a hundred k profit and I was like okay, this game now has shown me that my money can make me more money. Very cool. So I'm going to go buy duplexes and triplexes and single families scaled up to about 10 units.

While we were doing that, my partner Ryan and I were started. We started to do it together.

We started the podcast just to organically share our story and network like during the COVID times where people weren't out and about and what we realized quickly people started to know like and trust us like these guys are. They're doing it, they're risking their own money, they're making mistakes, they're sharing all the stories. Very cool.

We met partnerships through the podcast and that's how we were able to go into bigger projects where we owned a smaller percentage but we're able to get bigger upside.

So we started a general partnership buying actually in Vermont, New Hampshire where our partner lives and we buy like 5 to 20 unit multifamily value add and we try to buy as I mentioned, pre recording one a quarter. We've been unsuccessful in one a quarter but we've averaged about two a year for the last three or four years.

And that has been the start to us buying larger deals, expanding our brand and that's what we're focused on right now. So hopefully that answered your question.

Yeah, I love that. So you're, you guys now are focused predominantly on short term Rental and the resort space obviously Poconos, great market for that.

Is that still what you're doing?

The actually what we're focused on is the 5 to 20 unit value add. The in between getting to that. What we're doing now is we tried the short term rental route.

I figured out what worked, what didn't work, it was hard for us to try to scale it. The resort was another general partnership that we still own today.

That's kind of like just we're, you know, running that as we're managing the, the managing. The manager that's running that.

So the, the main focus is that Vermont, New Hampshire, it's on the, on the border of, of Vermont, New Hampshire near Dartmouth Health where the ED's and meds are. And there's some tech, there's a tech scene up there too. So that's what we're focused on.

Like A minus, B plus class properties that we can hold for five to seven years, bring in capital from our friends, family, 506Bs in our network and try to continue to acquire those as general partners. So really the main focus has been the value add multi in the last like two to three years.

But I can tell you all the mistakes we made along the way with some of the short term rentals and what we did and we still own a few of them, but it was just. It's a hospitality business. Right. It's very, very different than buying multi family and trying to scale that way.

Yeah, it's funny, it's. Neil and I both started fairly similarly. We both house hacked.

My first house was a duplex and then he has a house hack at the beach right now across the street from the ocean with an extra little rental unit under. Well, I started buying small multifamily at the beach, three quad plexes in a duplex that we converted to long from long term to short term rentals.

I couldn't find anyone to manage them the right way. We had to start a property management company.

Still have 10 short term rentals and a property management company that I'm partnered on with 75 listings there. And short term rentals is a lot of work. It is challenging. It doesn't scale very well. It's very, very labor intensive.

So very, very. And it's funny, you know how many people start management companies out of necessity for the lack of good management companies out there.

Like everyone I know is like, oh, we started a management company because we couldn't find the right one to do it. And it's just kind of how it goes. But I will say my.

The, the multipurpose resort operates as a short term rental because there's 43 units and 20 of them are short term. And like the other 23 are long term. We, we rent them out on Airbnb.

But if you do find a good manager, holding on to them is has been the biggest key for me. Like I have this property in Tampa that I kind of briefly mentioned that I go down there. You know, it's more of a lifestyle thing.

But I found the right manager and they have probably 50% X my revenue. I'm sorry, 50% increase my revenue.

And their super hosts, their guest favorite, all of these things that you need to really like, stand out as an experience. So there are levels to that management game. And if you find the right person, I'm happy to pay 20%. I really am.

But that's because I'm focusing on it like, well, I want to be able to use this property and I'm not trying to maximize every single dollar.

If you're getting into short term rentals with an interest rate environment like we're at now, people used to sell you the dream of $5,000 a month in cash flow and short term rentals. I just think you need to manage your expectations very, very much. Still possible. Even though people will say short term rentals are dead.

I do not think that's the case. I think bad short term rentals are dead. So I'm sure you have enough experience with that on your side.

I agree with you. I totally agree with you.

I think the only thing you can't control with short term rentals is, is what's happening in their market in terms of the interest rate and the price, obviously. And then what the neighbor's doing.

The interesting of what it really did is it was a race to the bottom on price, but it fundamentally changed the way that Airbnb listings operate on our island because the quality went up a lot because so many more listings were coming into the market and so many people were.

When things started going bad, the only things they knew how to do was really, really fix their Airbnbs up really, really nice, get professional photos and, and cut the price. And those two things didn't work well together and they went out.

And the people that got rewarded are the ones that got in early that have years of reviews that you're never going to catch up on. So.

And also the management of the Airbnb and having it like a five star resort really, or like a four star resort. And we made that mistake, guys.

And the problem with the Poconos, this is why the resort, like the, the, the, we call it Elements Resort. That's why it's working really well, because it's, it's the way of, it's licensed.

But the Airbnbs within the hoas up there, the hoas are like, oh, this is a money grab. So we're gonna, we're gonna charge you guys out the, you know what for every guest.

And then all of a sudden the $200 fee per month is $600 and you're like, wait a second. And it's kind of like owning a condo. You can't, you have no control. So a lot of people were in the market and they got out.

Like, I feel like Ryan and I were not afraid to try things. That's the only reason. We've just failed our way to, okay, this is what works now.

There's a difference between failing and failing forward. You know what I mean?

Like, if you're, you're picking up velocity, you're picking up lessons, and everything that you guys are doing is the same baseline, fundamental lessons, whether it's a single family home or 40 units or the 400 that I'm sure is probably coming for you guys next over the next couple years. So listen, you, you figured a couple things out. First of all, value add. And second of all, you guys are raising capital now.

Once capital is no longer a bottleneck for you, it really changes the numbers on things. You still have to find things that pencil, but it's not, it's like, oh, well, we're out of money.

We gotta wait till we can save enough to do it again. Once that goes away, it really changes things.

I would say this, so I was willing and still much more willing. I would rather, way rather lose my own money than any investor capital.

So the first 10 or so deals I did, I wouldn't say I really lost money because I wasn't flipping or wholesaling, but like, I made mistakes along the way and held long enough to eventually make profits. That's the forgiving part of real estate.

But what I learned is am I going to continue to, you know, deploy my capital, save it up, Deploy it, save it up, and eventually run out of your own money, or am I going to figure out a way to leverage other people's money, take a less percentage? I think that's what when, when I say I have 95 units.

Because it's when, when I tell people that they're, they think, man, Corey and Ryan are cash flowing off 95 units. They own it, the two of them. And what I want people to understand is that as a general partner, we're getting paid last. And that's okay.

But the windfalls for GPS are when you refi and are when you sell, and we're not even through a lot of those cycles yet. So I just don't like what people do on the Internet with the unit count. And I know it's part of a marketing thing and whatever, but I just.

I want to be upfront about that. Is like, I'm in the. I'm in year seven of this, but I feel like I'm just getting started.

The only difference is taking that leap from, you know, the 5, 8, 10 units, like, of duplexes and triplexes, and saying, you know what? I'd rather own a smaller percentage of larger numbers.

And so instead of buying a $500,000 asset, I want to buy a $3 million asset, and I'll own 35% of it, but that's okay because I'm in this thing for the long haul. So. Sorry. I kind of went out in left field there, but I just feel like that's important for people to hear.

We have been able to grow, and our decision was, instead of just growing alone, let's grow with other partners and grow together. That's how the capital raising came in. And we are now waiting for deal flow, not waiting for money, which is good, but the deal flows. It's tough.

Like, we have probably made offers on. In the last six months, probably eight. Like, analyzed a hundred offers on eight. Nothing came to fruition. So we're being patient.

We're waiting for the right deal, you know.

Yeah, it's. With this interest rate environment, you know, we thought was maybe we're going to get some relief maybe this summer. And then.

And then Iran kicked off, and it's just been, you know, who knows? You know, I'm this. Maybe a little bit inside baseball here, but, you know, you guys are. You've had a podcast for a while, and I've had.

I've been a podcast host for. I did.

Years. That's how we met.

You know, because you get a chance to have somebody on who's a subject matter expert and sit down with them for an hour and ask them intelligent questions.

Yeah.

And, you know, I'm curious what your experience has been like that. I think you guys have been going longer than we have. Um, and I hope we can get to top 1% in the world.

I think we're top 25% in the world or something like that. I don't know what that means.

I think that means we're top 10% at one point in time. I don't know what happened.

I don't know.

Yeah.

Either. I think that, I think that means that, like, you know, the problem is, like, the nup. That's a great number.

But also, you gotta realize the number of people who stop podcasting after five episodes.

It's 90%. It's 90.

Yeah, we're just, that's why we're in the top 10.

Yeah, we're in the top 10% because.

We just refuse to.

Because we just refuse to stop.

So to answer your question, yeah, I mean, like, what? I, I, I, I cannot emphasize this enough.

If we did not start the podcast and our social media to coincide with it, I would be stuck at a few units right now. Maybe I would have gotten to eight or nine and just saved up. And what, one a year? My goal was one a year for 10 years when I started.

I cannot emphasize enough. It's the only reason that we're having this conversation is because I started a podcast and you guys have a podcast.

It's such a mutual win, win, such a mutual benefit because your audience might be interested in what we got going on, you know, and vice versa. So I'll tell you, Covid really sparked this thing. There were so many negative things about COVID You know, I like to look on the bright side.

Thankfully, I didn't have anyone that was, like, super affected by it in my family. What the reason why I bring this up is I was stuck thinking, how am I going to network when the world shut down?

You know, depending on where you live Right. In Philadelphia, it was shut down. But I thought, you know, if I could just tell my story a little bit.

Maybe if Ryan and I just chatted about all the mistakes we were making, people would resonate. By episode 21, Guy took a chance on us. Before you know it, David Green comes on the show. Brandon Turner comes on the show.

And then they're like, when somebody said to us, hey, it was David. I remember episode 50, he goes, you know, you guys are kind of good at this. And I was like, that's all I needed to hear.

So that, so now, you know, we've went from one episode a week to two episodes a week. And what it has done is built a virtual resume.

So when you're At a networking event or you're at a conference or whatever, and people hand out business cards that end up in the trash. All I do is say, here, check out, just check out our Instagram or check out our podcast. And then there's some validation there.

And then that's how conversation gets started. So it has opened up doors beyond doors beyond doors for us that I cannot even like I've been in rooms that I have no business being in because of it.

Now the consistency is the key. And doing it for years. We're on year six.

Joe Rogan was interviewed or was interviewing somebody the other day and they asked him how long till your podcast started making money? And he said five years. I mean, to do something for five years without expectation of not making any money. You know, it's funny, similar thing.

We're nowhere obviously near that, that zone, but five years when people started paying us for sponsorship and paying us for spots and that was like, man, like it's starting now. I feel like we're just getting started, but hopefully that answered your question.

I think the podcast has been everything, I can't emphasize how enough how it's just the catalyst for our entire journey and meeting our partners and everything.

Well, we didn't bring you on here to like get inside baseball on podcasting, but it's just always interesting hearing other people's stories.

Yeah, happy to chat about podcasting too. If you want, we can talk.

Sure, yeah, we can do that. We can do it offline. We can compare notes.

A lot of our listeners are high net worth professionals who prefer to invest passively rather than operate properties themselves.

Obviously for someone hearing about your approach for the first time, can you explain in plain terms how you guys structure deals so that busy investors can participate without managing the tenants or renovations?

Yeah, I would say I love the name of your guys podcast, Truly Passive Income.

Because anybody that invests in real estate actively kind of knows like the only real way for it to be truly passive, like you guys are saying is if you're a limited partner investing with maybe you guys or maybe with us. So that was our hope.

We were hoping everybody would figure that out on their own, but we have to spell it out every time.

Yeah, I know.

Now what we have figured out is that because of the Internet, you don't have to invest in your backyard. Okay, so now that being said, our partner lives where we invest.

So me and Ryan are in the Philadelphia area, our partner lives in the town, in the three surrounding towns that we invest in. What we do is, well, where's all the retail dollars going?

Well, they're not looking certainly New Vermont, New Hampshire don't come up as like the Sun Belt or Texas when you hear where the money's going. So it's like what's called a micropolitan. And a micropolitan is basically like a city, a small city, a hundred thousand or under.

And this town, these towns that we're investing in, it's called the Upper Valley, has got ranked the number one micropolitan because of the text scene, because of the heads and meds that are all there. So we're kind of like underneath the institutional dollars and above the retail dollars. So our competition is a little bit less.

Buying 5 to 25 unit value ads in A minus or B plus class neighborhoods. So we're getting our investors, we just call it plain and simple, double digit returns backed by real estate.

Our plan is to hold for five to seven years. We look to refi anytime we can. We keep the investors in the deal and then obviously sell if the number makes sense.

But we refi get investor capitals back as quickly as we can and look to hold for five to seven years, typically between two and two and a half x return on investor capital. So that's like the elevator pitch of what we're doing.

We found that really just by searching for different strategies that some were working, some weren't thinking, yeah, we could try to go buy 100 unit apartment complex where we're just competing with people who do it a lot better than us. Let's figure out what our competitive advantage is. And now we're a little bit known as that.

So we get deals sent to us by our property manager, our lending contacts, some, some direct to seller marketing, and that's how we've kind of found our niche.

So yeah, yeah, it kind of turns into a flywheel, honestly, when people know what you're looking for that, you know, your. Your units create more. More chatter. That creates more opportunity because more people are bringing you deals as well.

I noticed, you know, you said a couple things earlier. You said that it's hard to find deals. That pencil, which I think that that's common denominator across the board.

But I also think that you guys use seller financing on your 43 unit. Is that right? Or was it that one?

Or.

I know you've used some seller financing in the past.

When we sell our finance and we actually just refinance into a new loan product. But I'd have to actually talk to. I'd have to talk to my partner on the exact details on that. So I don't want to lead you astray.

But yeah, I mean, seller financing, obviously, it's like such a great strategy because you're creating the terms, but typically, the way that we're buying value add multifamily. The ones that we're doing in Vermont, New Hampshire, right now, we are getting commercial financing.

The remaining that we're getting commercial. Commercial loans on.

So we have tried to do seller financing in some of those strategies, and we're actually looking at a mobile home park right now that we might. But I wouldn't call myself a seller financing expert. I think it's something that, like, I've dabbled in that I.

But the cool thing about it is that you set the terms if you can come to an agreement with the seller, if it makes sense for them. I know somebody who just bought a mobile home park where the seller was 75, and he's like, Look, I just want $4,000 a month, zero percent interest.

They're like, okay, we can pay you 100,000 more than you were asking if we can do that, that type of term. So I'm very. I'm like, a little bit wet behind the ears on the seller finance. I know how it functions and how it exists.

But I wouldn't say it's like a strategy that we've done on a lot of our deals.

You're on the way. I think it's something that is going to become more commonplace right now.

It's like, okay, we kind of got a triple whammy here. That's really limiting our ability to find cash flowing deals. A lot of times the seller financing component can bridge that gap.

It's like, you know what, I can get you the price that you want. This is what the market value is. You're actually priced over the market. I can give you that price or even a little bit higher.

And here's what I need is for you to be the bank on even a portion of that. We closed on a man, it's probably in two and a half months now. We closed on 171,000 square foot Kmart with 24 shops in a big retail strip mall.

And we only had to raise 2.8 million bucks for the whole thing because the guy carried back a portion of it. We're going to convert the Kmart to storage and then out parcel the parking lot. And then it's generating $60,000 a month in the rental income.

It's cash flowing from day one just because he was willing to hold back a portion of it. And we, a lot of people passed on the deal. We gave him the price that he wanted.

He holds back, you know, seven figures and then all of a sudden the raise turns into next to nothing. So I think a lot of times the capital that people are being challenged to raise is actually equity that's already in the deal.

That's a great point. And I actually, I mean, you know, I'm oftentimes on the other side of the mic, so I. Forgive me, but I want, I'm very curious. I'm.

I'm going to ask you a question about this because of, okay, look at what's happened in the stock market the last eight months. You've had a 12% correction and then back to all time highs within like it might have been 30 days.

I don't even like because, you know, I have some exposure to it too. Not as much as real estate. But I'm curious on your limited partners.

The, the avatar for somebody who wants to invest in a deal like that, is it diversification from what was once really not like super volatile in a short period of time?

The thing that, the challenge, maybe not a challenge, but the thing that our investors look for is like, hey, I want to plant my money in the ground because sometimes looking at it on a screen is a weird thing and I want to know that it's planted in the ground even though it's a five to seven year. And some people have time, have a hard time with patience.

So I'm curious on your end, who's the person that's the perfect person to invest in a deal with you guys? You just mentioned a bunch of, you know, like engineers, doctors, that type of thing. But I'm curious how it's.

If there's similarities to our investors.

Yeah, so it's actually a. Not a very sexy asset class at all. Right. The Poconos and short term rentals and you know, small boutique resorts. That's awesome.

We rent people boxes of air. Like the people that invested with us are people that are investing in storage.

And I do have a, I had a 16 year career as a medical sales rep in cardiology. So that's why a lot of our early investors are physicians that I used to work with.

But the reality is our deals are self storage, which is, there's nothing sexy about that. But there's no bathrooms, there's no kitchens, and there's no tenants in the property as long as you're doing it correctly.

And the difference for us is that instead of building it for 130 bucks a square and taking two and a half years, we buy an old building, we can convert it in 10 to 12 months for 65 bucks a square. And that includes the building, the land, the construction, the parking lot, everything. So we are half price storage in a third of the time.

That's our pitch. But the investor is still a self storage investor. Self storage is the best performing commercial asset of 35 years.

So it's nothing is proof, but it is recession resistant, inflation resistant. Now we know pandemic resistant. So that's, that's who it is. And it's, it's also exactly the nomenclature that you already used.

It's somebody that wants their money in the dirt in the ground. And they understand that it's real estate and not real stocks. That's a paper asset. You're betting on that CEO to do their job.

So if you don't want to continue to trade time for money at your job for the rest of your life and you don't want to trust someone else or whatever's happening in whichever news channel you watch, it's determining the value of the stock market, then real estate is an option. And then, of course, you have the bonus depreciation through cost segregation that came out over the last, you know, almost 10 years now.

That, along with qualified opportunity zones, has pushed a few more people into that space, specifically towards some of those longer hold asset classes. And storage is something that does really well for the long term.

Yeah.

So it's a. It's a niche product and it's. We have a long. Especially our early. Most of our early deals were all 506B.

Yep. That's what we do.

Yep.

And that was obviously easier to raise capital because it's friends and family and that trust transfers, but still challenging for us in some ways because a lot of our early deals are forever holds. Like, why would we. We're buying this facility. Like, the first Kmart that we bought was 1.5 million for the building and the land. 87,000 Square feet.

And if we just wanted to build the cinder block shell, it would have cost $6 million. So, like, why do you want to give up that basis?

But when you tell people, yeah, we're going to hold it forever, that scares off a lot of your investors. So you really have to do. You've got to. Especially these days, you've got to tailor to what the investors are looking for.

You're taking a property in the Poconos, and you're turning that into a retail investment product that you are bringing to market.

And if you have to close it in a certain amount of time, it better be a product that the market wants to see with a clear exit strategy with people they know like, and trust, which you've already done.

Well, I like. I like the self storage aspect too, because America loves stuff, and I don't think I know if that's going anywhere.

And it's just one of those things that, you know, it's probably an autopilot thing, kind of like a subscription in a way for people. If you think about it like that, it's of kind.

It can be.

Yeah. Very cool.

I'll add what Clint said, too, about what the investors are looking for.

I think there's a Real psychological thing for people who invest in real estate, like literally just being able to see it and touch it, that's different from a paper asset like a stock. I also think that there are, there's a level of sophistication for these investors where they're looking for uncorrelated assets.

They're, they're heavily in the stock market.

There may be a tech, you know, they're a tech entrepreneur, they got a lot of money and they're, they kind of know that they need to spread their risk out. And just being diversified across the stock market is not diversification.

And so they're looking, you know, they're looking for opportunities to buy into the roofing company in such and such town, a self storage facility, multifamily, you know, and things like that.

So I think that's often one of the, I don't know, pitches that I try to make for people is that, look, if you're only in equities, you're not diversified. I don't care if you're in, you know, you've got European and Asia exposure, you're still in equities, still paper asset.

And, and you, you really want to try and find some uncorrelated assets that truly are uncorrelated.

The reason for the use case for like syndicators, if you will, like us, I think is because of such hot dollar debasement. So the, the challenge is, is that now everyone has to be a stockbroker because of dollar debasement.

So like if you're a cardiologist or you're an engineer or you're a tech entrepreneur, you want to be really good at that thing. You don't want to be that. And then a day trader on the side or that. And then I have to now go like, figure out how to buy rental properties.

Like, you don't have enough time for that. So I think it's actually, it's not a good thing.

Dollar debasement isn't necessarily a good thing, but I think it's, it's a use case for somebody like who, who has the money, who's like, I don't have the time to go do this. I want to trust people to go help me grow my money. And then that's kind of where we fell into our place with it.

So it's, yeah, we're gonna see where it goes.

But our goals are get to, to get to 500 units in the next three to five years because that way we can bring property management in house, save some costs. There, that'll, that'll spit up enough cash flow for me and my partner. So, like, really be able to affect our lifestyle in a way that we want to.

So, yeah, I love it.

I have no idea what you'll get there. You know, I used to.

What Neil was referring to earlier, what I said about podcasts is, you know, I used to say if you want to learn about something, you should listen to podcasts. Because I believe in the law of a hundred hours.

You know, you spend a hundred hours studying one thing, you're going to know more about that than 95% of the people in the world, and that is only 18 minutes a day for a year, which is less than the average person's commute.

But the reality is, if you really want to learn about something, start a podcast, because then you get to sit there and be on the receiving end of that much information. And it's just, it's a, it's a time warp in terms of how much you're learning and how much you're moving forward.

And it gives us an opportunity to ask about veteran moves when we see them. You've got a veteran move in your bio that popped up that I, I have to ask about because I don't think we've had a chance to ask about this before.

Before. So you spoke about a rental property that actually burned down due to a neighbor's fire.

Yeah.

And then I know that it has a different timeline as well. I believe a two year window.

Ryan and I have to buy the property, the two of us, the way that we bought this property, the exact same way, in order to do it, in order to transfer it. And then so the rolling of the funds, the interest rates doubling since we bought that property, has been tough for us to find the right deal.

Not really an appeal process, but it's like trying to get an extension on that for one extra year so you can have an opportunity to extend it with the IRS for one extra year. We're trying to do that right now because we're still on the hunt to try to look for this. So it's. It's. To me, it's enough time.

If the 1% chance that someone's listening to this podcast that has a casualty, which was to no fault of us or our tenants, you have the opportunity to defer the game. So interesting.

I did not know about it, but it's one of those other benefits of real estate that you get in and you learn when you're kind of in the fire. And that was a crazy time. That was a crazy time for us. And having good insurance. I'll never skimp out an insurance.

We didn't, but I'm so glad that we didn't because, you know, we. We made out okay. And now we're trying to, like, figure out how to roll this capital into the next thing.

But Ryan, our Strategy has also changed on what we're buying. We're buying with partners. So we'd have to kind of go back to the two of us buying to find the right deal. And that's what we're trying to do.

Yeah, look it up. I mean you can just like run some models on like chat.

Clint's suddenly thinking about whether or not he can get away with burning down some few of his property.

I wish I'd known this when one of my quadplexes flooded two years ago. And that would have been a good time.

Yeah. And I think it had, I think, don't quote me again, I'm not a CPA or, or you know, I don't do this for a living. But I'm 99.

Sure has to be like a total loss. So like even if you have a flood, you have a claim. If it's not a total loss, I don't think you can use, use it without.

Got it.

Yeah.

So I, I gotta ask about your, your multi family value add strategy. So the traditional strategy that we're seeing right now is people are buying B and C class apartments, which is not what you're doing.

And then they're adding lvp, granite countertop, stainless steel or whatever. And you're increasing the rents.

The net operating income goes up, it increases the value of the property by 30%, you sell it and everybody gets a payday. And that works great as long as rents always continue to go up.

Unfortunately, there's places like Austin, Texas right now where you never thought you would see it. They're not, they're retracting and they're going down. You guys are buying like B plus A minus assets.

So what is your forced appreciation value add strategy and how does that create the value that, that you're exiting and how are you creating like what's your, what's your competitive moat? What's your strategic advantage in your competitive remote right now that is, is protecting you in this market?

Yeah, it's a good question. So I would say the majority of our assets are B plus. We just, we bought an A minus in and you know, it depends on who you're asking. Right.

Of whether or not it is. But the, this. So the, I guess you have to determine whether or not you're talking about the asset itself or the area. Right.

So we're buying mismanaged in B plus and A minus areas.

And in some of the areas because we're close to Dartmouth Health, we are furnishing. So we will take a 10 unit.

We have a 10 unit as an example, six of the units we've furnished and we're renting to traveling nurses and traveling professionals that are working at Dartmouth Health.

So we'll take an asset like that and say, okay, can we get 25 to 40% more rent by spending money to furnish this property and then kind of have some long term tenants and some midterm if you will, 16 unit rotations or 16 week rotations that are coming into the area.

So I don't know if that totally answered your question, but they're, they're mismanaged or poorly managed B plus areas where the asset itself still does need some construction work. But we're not doing anything like full gut renovations.

What we have done because of the 10,000 housing unit shortage is taken a 7 unit or an 8 unit and turned it into a 9 or 10, which has been really beneficial for us from just from an NOI perspective. And Then we just lost out on a deal recently that I'm pissed about, but a 17 unit that we were going to turn into a 21 unit.

Love it. You know, in this, you know, they often say in this market that you don't find deals, you make them. And I think that's very much what you're doing.

Yeah, I would say the riches are in the niches, right? Like the people, the, the big, the Main street strategies are really not working great right now. There's a lot of distressed assets out there.

People are still tossing in the keys with strategies that nobody ever thought you could lose on. You had people that for years were making money hands over fist, everybody looked like a genius and then the rug got pulled.

And you know, Warren Buffett says, I says say this all the time, but you can't tell who's skinny dip until the tide rolls out. People got exposed. And now you're a situation where a lot of those people, their social media has gone dark.

People have had capital calls, people have had total losses. There's more total losses coming even in the next month from some major groups. And I think you guys have found your niche.

You found a market first of all.

And when you're struggling to get deals, you have not ventured outside of that market, at least to my knowledge, to really like stress stretch yourself and stress yourself to go find a deal. Like, you know, obviously rule number one, you got to fish where the fish are. But the reality is there's not a lot out there right now.

And if, if you're willing to just be patient, sit back and stick to your guns and stay below that sub institutional level where you're in those 20, 40, maybe 30 to 50 unit range or less, you're not getting a lot of, of compression there, but you guys still potentially could build a portfolio and then when and if you unload that as a portfolio, get a cap rate bump there too.

So, yeah, that's, I mean, it's a great point and like, thank you for the foreshadowing. I hope that what you're saying comes to fruition. You know, I think, I think from.

Clint's lips to God's ears.

Yeah, absolutely. I think like I said, our goal is to get to 500 units. And I don't know if that's, you know, if that's 12, 15 more properties.

I'm not sure what it is, but we have found this 7 to 25 unit, maybe 30 unit niche that we. I, you know, my whole thing is I just never want to get over leveraged in.

And he stopped investing in real estate after that. But he was like, I know it's a good asset class, I just did it wrong.

I just don't want to get in a situation where I say, Yeah, I have 200 units, but I'm in 40. 40 Different markets, obviously not that many, but in five different markets, like trying to like, you know, rob Peter to pay Paul.

Like, it's just my whole thing is if we can say small enough, small but mighty enough, I really think we can create a pretty big windfall for us and our investors. It's just that shiny object syndrome is tough.

And that's the hardest part about this podcast because I've had 400 episodes of people that are like, this is what I'm doing. And I'm like, whoa, teach me. I'm like, but I gotta stay away from.

We're both guilty.

Yeah, Very guilty of that. Yeah.

All right, well, let's get a little shiny object going right now. So you participated as general partners in a ground up development fund in Arizona built around a five deal cycle. And this is so unusual.

Never heard anything like this 10 year compounding model. Rather than the typical value add syndication with quarterly distributions.

Can you explain the thesis behind that structure and why you believe the rolling proceeds through multiple deal cycles outperforms the traditional hold?

This is fun. So I met through the podcast a gentleman named Balakrishnan and he started Peel Technologies. This is a little bit of a long story.

I'm trying to keep it short. Which is a tech startup in Silicon Valley that he sold for hundreds, hundreds of millions.

While he was doing that, he became financially free through this strategy that he used. And it was buying properties, value add, selling them every two years and trading up. And trading up.

Because his thesis is you don't actually have enough cash flow until you get to like $1 million in like, I guess the, the, I don't know the exact number that he used, but you don't have enough cash flow starting out to actually affect your lifestyle. So don't worry about cash flow. Trade up your equity consistently.

And basically what this project is, it's a five year cycle of ground up construction of building a property, after two years, selling it into your next asset that you're building and then selling it and then trading up from a $30 million beginning to $100 million plus.

And this, you know what this is essentially doing is giving the, the spread on, on ground up construction right now, which is a little bit more than value add multifamily, although they're not, we're not ruling out multifamily as some of these projects, but these are larger projects and the thesis is that after 10 years you'll actually have enough cash flow coming in that you can affect your lifestyle as opposed to trying to figure out the cash flow along the way. So people are in these deals, general partners and limited partners for these 10 years and it may be 12 by the end of it.

But I, I think our partner Bala is like the mastermind behind this and hopefully I give enough context to work with. But it is a little bit unconventional and people have tried to poke holes in it. But I truly believe in like him and what he's building out there.

And he's in the Phoenix Scottsdale market. So those are all the, where all these properties are. We're in like year two ish. So we're going into that second cycle right now.

Yeah. So listen, who not how, right? Sometimes you don't have to figure out the strategy yourself.

You just need to know who knows how to do it better than you do. And with that I will ask you the question. Listen, we could go on for a long time. You're a great interview. You're clearly a pro.

You got 400 of these under your belt, no doubt, plus however many you've been a speaker on. I'd love to keep it going, but the reality is we gotta land the plane here.

One of the questions that we ask, I can ask it the boring way of like, hey, is there a book you recommend? But the reality is you got a lot of people that come to you, Corey, and they're like, hey, you know, how do I even get started?

How do I learn about this? How do I engage? Where do I go?

When you are talking to a friend or family member in your 506B community and people are asking about how they can educate themselves, is there consistently one, like, book, resource speaker, you know, social media, is there one place that you find yourself recommending to people more than any other?

Well, so that's a great question. I think it really depends on the stage that people are at.

But I'll tell you how many times I've gone for coffee with people, which was why I started our mentorship program to teach people how to buy their first or next 0 to 5. Let's get the ball rolling for you. Because I wanted to be the resource that I never had in the beginning.

The bigger deals will come later, but let's get started. So in terms of a resource, I mean, I think our podcast is a great resource in terms of a, you know, mindset. Rich dad, Poor Dad.

In terms of a what to do. Like, Set for Life by Scott Trench. More of like a, A book about, like, personal finance.

And like the, the starting of the investing is actually figuring out how you can separate your income from your expenses. Because if you don't live under your means, you can't invest, period. Like, that's, that's how it started. Like, I'm 34. I drive a paid off car.

Like, do I want to drive a paid off car? No. But now I'm in this habit of not spending the money that I have. So it's like I've, I've delayed gratification for a long time.

This, this wasn't even answering your question. Let me get back to it. So I would say as resources, those two books, Rich Dad, Poor Dad, Set for Life by Scott Trench.

And then I would say, find yourself somebody who is not a hundred stages ahead of you, but three or four stages ahead of you, or two to three, that has the life and the thing that you want at the end of that, and associate yourself with someone in. Associate yourself with them in some way. Work for free, join their community, find out a way that you can add value to their life.

And I know that's vague, but if you can do that, you will rise up to the level of somebody that you, that you aspire to be. And I think that's why people in the W2 world are, like, looking around like, oh, man, my manager's manager. I don't know if I want that.

And, like, do I want that? So you got to find the people that you want to be around, and the podcast world is the catalyst to finding those people, finding your tribe. So.

Absolutely.

Hopefully that was helpful in. Yeah, question.

Well, great answer. I think every high school graduate should be forced to read Set for Life by Scott Trent. That's a, that's a. Yeah, you know what?

That, but, like, that just came to me as I was thinking. It's not like I had that, like, thought in my head, but as I was thinking, like, what's a book? That had a big impact on me. That really did.

Did it really did. Because, you know, you can get caught in, like, trying to make your own soap and be super frugal.

I'm not saying that's the right way to go, but I, I, I'm.

What I am saying is that I kept my expenses the same for four to five years, and by doing that and increasing my income, it taught me, okay, now I can increase my expense expenses in a significant fashion, actually affect my lifestyle, but not just creeping it up as my income goes up, and you never really get ahead. And that book showed me the way on that, without a doubt.

Yeah, Richard, Rich Dad, Poor dad, great kind of mindset book. And I think, I think Set for Life, much better tactical book.

Yeah, like, really, you know, really gets down to the nuts and bolts where Rich Dad, Poor dad doesn't, but.

Yep, absolutely.

All right, listen, Corey, we got to land the plane. Thank you so much for being here. I'm excited about your all, all your success.

I'm excited to continue to watch your podcast flourish and see what comes as a result of it, because I know you're going to have nothing but continued growth. I think that, you know, a podcast is, is rocket fuel. I honestly believe that.

And you combine that with your ability to raise capital, I have no doubt you'll hit that 500 units, probably ahead of schedule. So, last question.

If any of our investors want to hear more about you and Ryan and what you guys are up to or potential ways they could partner with you, what would be the best way for them?

Well, first of all, I appreciate the compliment. Thank you so much. This, you guys are great interviewers. This is a lot of fun. I love doing this.

It's, you know, it's 3:00' clock on a Thursday, and I blessed to be able to just be a podcaster and have these conversations not stuck behind a cubicle somewhere. So I never forget that regardless of the mountains that I'm trying to climb.

The best way to get in touch with us or see what we do the Wealth Juice Podcast. Wherever you listen to podcasts, Apple, Spotify, YouTube, Instagram, I post every single day.

I post every single day for the last six years on Instagram at Wealth Juice Official. Ryan and I run the account. If you DM us, it's me answering you. If you're interested in reach out on either front.

If you're interested in like potentially passively investing in some of the deals, we have to get to know each other as a 506B. But I'm happy to chat. Set up a call if you want to learn how to do this yourself and get started.

Took me six years to leave my job, but I'm so it it wouldn't have happened without that first deal. If you want to learn about that, shoot us a DM on Instagram. I'm happy to show you about what we do to plug you in to get your first few deals.

So that's the best way to connect with us. And I, I want to thank you guys for having me on. This is. This has been awesome. Awesome.

Corey well, thank you so much. Appreciate you being here. Thanks for your time.

Thank you so much for listening and watching the Truly Passive Income podcast.

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