For the next 30 days, I will be posting some useful tips I have gathered from my prior deals.
First Tip 7/5/19
Never trust a broker. I cannot tell you how many times a broker has ruined a deal for me. The first step to working with a broker is realizing all they want is their COMMISSION! Know what drives other people and you will be successful.
Never trust a broker. I cannot tell you how many times a broker has ruined a deal for me. The first step to working with a broker is realizing all they want is their COMMISSION! Know what drives other people and you will be successful.
Second Tip 7/6/19
It's almost always better to buy a building in a more distressed neighborhood. By buying in the city center you are almost always assuring you will overpay. This may seem fine in the short run but in a market downturn, this can put strain on your portfolio.
It's almost always better to buy a building in a more distressed neighborhood. By buying in the city center you are almost always assuring you will overpay. This may seem fine in the short run but in a market downturn, this can put strain on your portfolio.
Third Tip 7/7/19
You will find that many people will push towards the necessity of having a mentor. I would agree that having a mentor can be very helpful. But in this day and age, it is not a necessity. Use the internet, build an online network and talk to others in Real Estate
You will find that many people will push towards the necessity of having a mentor. I would agree that having a mentor can be very helpful. But in this day and age, it is not a necessity. Use the internet, build an online network and talk to others in Real Estate
Fourth Tip 7/8/19
As a CRE investor, an excel model is essential to pre-screen buildings. I would recommend taking the time to create your own model rather than buying one. If you spend 60 hours creating it you will know it like the back of your head.
Don't be lazy.
As a CRE investor, an excel model is essential to pre-screen buildings. I would recommend taking the time to create your own model rather than buying one. If you spend 60 hours creating it you will know it like the back of your head.
Don't be lazy.
Fifth tip 7/9/18
Always be wary of the seller and his lawyers.
If the seller is not very helpful and he has hired a corporate law firm just know you are in for a treat.
I am in the process of a deal like this. It took 5k in lawyer fees to just get a p&s.
Always be prepared
Always be wary of the seller and his lawyers.
If the seller is not very helpful and he has hired a corporate law firm just know you are in for a treat.
I am in the process of a deal like this. It took 5k in lawyer fees to just get a p&s.
Always be prepared
Sixth tip 7/10/2019
Understand the fundamentals behind the metrics you are using.
For example IRR is very important but most people don't actually understand it's limitations
Instead they use it as the one stop metric for return. This can seriously impact a deciding on a deal.
Understand the fundamentals behind the metrics you are using.
For example IRR is very important but most people don't actually understand it's limitations
Instead they use it as the one stop metric for return. This can seriously impact a deciding on a deal.
Seventh tip 8/11/19
Rent control.
This is a key point of contention in the RE world.
My firm simply just doesn't do residential in our states because of it.
The tip here is know your local laws. They change from State to state so make sure you know where your state lies
Rent control.
This is a key point of contention in the RE world.
My firm simply just doesn't do residential in our states because of it.
The tip here is know your local laws. They change from State to state so make sure you know where your state lies
Eighth tip 7/12/2019
Wait untill you have enough money to do it right.
Overestimate your costs for setting up a deal. I like to make sure I have 2% of the purchase price for closing
If you go in with not enough money you will most likely skimp and it will bite you in the ass
Wait untill you have enough money to do it right.
Overestimate your costs for setting up a deal. I like to make sure I have 2% of the purchase price for closing
If you go in with not enough money you will most likely skimp and it will bite you in the ass
Ninth tip 7/13/19
This is a simple one.
Understand what you are getting yourself into working for yourself. It is not for everyone.
You have very little security. Your success is determined by you and you alone.
Hours are fluid. I work whenever duty calls.
Take your pick.
This is a simple one.
Understand what you are getting yourself into working for yourself. It is not for everyone.
You have very little security. Your success is determined by you and you alone.
Hours are fluid. I work whenever duty calls.
Take your pick.
Tenth Tip 7/14/19
This one is one of my favorite quotes.
The road to hell is paved in good intentions.
This one is one of my favorite quotes.
The road to hell is paved in good intentions.
Eleventh tip 7/15/2019
Don't be allured by the real estate in the big city. A lot of people want to buy in Manhattan or in the city.
What people fail to realize is that these properties are almost always overpriced.
It is why you almost always see these buildings sell quick
Don't be allured by the real estate in the big city. A lot of people want to buy in Manhattan or in the city.
What people fail to realize is that these properties are almost always overpriced.
It is why you almost always see these buildings sell quick
Twelfth tip 7/16/19
NYC is about to have some major issues.
With rent control city wide as well as 14 day notices for evictions NYC is in for a reckoning.
We will see many owners not being able to pay mortgages which will lead to defaults and bank takeovers.
BUYER BEWARE
NYC is about to have some major issues.
With rent control city wide as well as 14 day notices for evictions NYC is in for a reckoning.
We will see many owners not being able to pay mortgages which will lead to defaults and bank takeovers.
BUYER BEWARE
Thirteenth tip 7/17/19
This is just a quick ine. For anyone out their in business.
Watch Ray dalios economic machine video on YouTube.
It's very informational.
If you have more time. Read Principles by ray dalio it's an awesome book
This is just a quick ine. For anyone out their in business.
Watch Ray dalios economic machine video on YouTube.
It's very informational.
If you have more time. Read Principles by ray dalio it's an awesome book
Fourthteenth Tip 7/18/19
Stop labeling yourself.
Stop saying you are an entrepreneur stop saying you are an introvert or a hustler or whatever.
When you label yourself you become that label you act the way you are supposed to act.
Break free of labels and do what you want
Stop labeling yourself.
Stop saying you are an entrepreneur stop saying you are an introvert or a hustler or whatever.
When you label yourself you become that label you act the way you are supposed to act.
Break free of labels and do what you want
Fifteenth Tip 7/19/2019
The reason why I do not do small residential homes is for two reasons.
The value is derived from comparable houses in the neighborhood.
I have enough money to not invest in them.
The reason why I do not do small residential homes is for two reasons.
The value is derived from comparable houses in the neighborhood.
I have enough money to not invest in them.
Sixteenth tip 7/20/2019
Look up the Pareto distribution. And the 80/20 rule.
20% of your clients with take up 80% of your time.
And 20% will make 80% of your money.
Cut out the people who take 80% of your time but not 80% of your money.
PS. It also works with assets
Look up the Pareto distribution. And the 80/20 rule.
20% of your clients with take up 80% of your time.
And 20% will make 80% of your money.
Cut out the people who take 80% of your time but not 80% of your money.
PS. It also works with assets
Seventeenth tip 7/21/2019
Rich people are normal people.
They are weird they are suave they are all different types.
The reason I say this is because everyone can be rich it is just up to you. Rich people are from all walks of life.
It is attainable if you want it to be
Rich people are normal people.
They are weird they are suave they are all different types.
The reason I say this is because everyone can be rich it is just up to you. Rich people are from all walks of life.
It is attainable if you want it to be
Eighteenth Tip 7/22/2019
Don't overpay for the small things even if you have the cash. Once people get money they usually start to get sloppy and overpay for things.
For example I was quoted at 8K for a roof inspection by a large firm with corporate clients
Dont fall for this
Don't overpay for the small things even if you have the cash. Once people get money they usually start to get sloppy and overpay for things.
For example I was quoted at 8K for a roof inspection by a large firm with corporate clients
Dont fall for this
Nineteenth tip 7/23/24
Keep reading books are where real information lies.
Comment if you would like to hear my book list
Keep reading books are where real information lies.
Comment if you would like to hear my book list
Twentieth tip 7/24/2019
Sometimes if you are a CRE investor getting a brokers license can be a negative.
Getting a brokers liscense can open you up to more risk because now you technically know more about the laws not allowing you to claim neglegance.
Been wary
Sometimes if you are a CRE investor getting a brokers license can be a negative.
Getting a brokers liscense can open you up to more risk because now you technically know more about the laws not allowing you to claim neglegance.
Been wary
Twenty first tip 7/25/2019
If you can get ten year money in your deals I would take it. Out of the 20 or so banks we have asked only one has given us a ten year deal.
We pay a small premium for it in our interest rate but we think it is more than worth it.
Shop around...
If you can get ten year money in your deals I would take it. Out of the 20 or so banks we have asked only one has given us a ten year deal.
We pay a small premium for it in our interest rate but we think it is more than worth it.
Shop around...
Twenty third 7/26/2019
Take yourself out of your comfort zone. I am naturally more reserved and I don't love to chat and make connections and stuff
I end up pushing myself to talk to people I wouldn't normally talk to and put myself out there
Typical but important advice
Take yourself out of your comfort zone. I am naturally more reserved and I don't love to chat and make connections and stuff
I end up pushing myself to talk to people I wouldn't normally talk to and put myself out there
Typical but important advice
Twenty fourth tip 7/27/18
Do it today not tomorrow. People who always say that they are gonna do it the start of the next week almost never actually do what they are saying.
Just do it stop worrying about when. Take a jump and just do it
Do it today not tomorrow. People who always say that they are gonna do it the start of the next week almost never actually do what they are saying.
Just do it stop worrying about when. Take a jump and just do it
Twenty-Fifth Tip 7/28/19
Make a long term plan. For my firm, I have done something untraditional in the CRE space. I run my own management company on the side to manage the buildings in our portfolio.
Point is plan 20 years ahead for real estate. It is not a pliable business
Make a long term plan. For my firm, I have done something untraditional in the CRE space. I run my own management company on the side to manage the buildings in our portfolio.
Point is plan 20 years ahead for real estate. It is not a pliable business
Twenty Sixth tip 7/29/2019
Buy buildings based on your capital.
For instance I am currently looking at a building with a failing roof. It will cost 10k just for thorough inspections.
I might just lose that 10k if the roof is too bad
I can stomach that. Make sure you can too
Buy buildings based on your capital.
For instance I am currently looking at a building with a failing roof. It will cost 10k just for thorough inspections.
I might just lose that 10k if the roof is too bad
I can stomach that. Make sure you can too
Twenty Seventh tip 7/30/2019
For the love of God don't skimp on your lawyer.
A good lawyer will know your due diligence process. Will know the right questions to ask. Will know the local market, the players in the local market etc...
Lawyers are expensive but for good reason
For the love of God don't skimp on your lawyer.
A good lawyer will know your due diligence process. Will know the right questions to ask. Will know the local market, the players in the local market etc...
Lawyers are expensive but for good reason
Twenty-Eighth Tip 7/31/2019
Loopnet is garbage. My old boss told me LoopNet is where listings go to die.
If you are serious about buying do not look on Loopnet.
Instead, you have to call all the brokers in the area. Introduce yourself and have them send you their listings.
Loopnet is garbage. My old boss told me LoopNet is where listings go to die.
If you are serious about buying do not look on Loopnet.
Instead, you have to call all the brokers in the area. Introduce yourself and have them send you their listings.
Twenty-Ninth Tip 8/1/2019
I am untraditional. I also have a management company that manages my portfolio rather than outsourcing to a different company.
If you are like me then make sure you pick a very good management software. It is the backbone of your management company.
I am untraditional. I also have a management company that manages my portfolio rather than outsourcing to a different company.
If you are like me then make sure you pick a very good management software. It is the backbone of your management company.
Thirtieth tip 8/2/2019
Always shop around on your loans.
Go to 15 different banks and see what they give you for a loan. Simple but you always want to keep your options open
Always shop around on your loans.
Go to 15 different banks and see what they give you for a loan. Simple but you always want to keep your options open
Thirty First Tip 9/2/2019
We are starting this shit up again. I think people like tips.
If you self manage your buildings make sure your buildings are close to each other.
It costs time and thus money to have workers running around town to buildings an hour away.
We are starting this shit up again. I think people like tips.
If you self manage your buildings make sure your buildings are close to each other.
It costs time and thus money to have workers running around town to buildings an hour away.
Thirty Second Tip: 9/21/2019
Always double-check everything when purchasing.
I have had countless deals where the Offering Memorandum does not match up with the Leases.
Never trust your broker's word, the sellers or anyone but your own research.
Again DOUBLE CHECK EVERYTHING
Always double-check everything when purchasing.
I have had countless deals where the Offering Memorandum does not match up with the Leases.
Never trust your broker's word, the sellers or anyone but your own research.
Again DOUBLE CHECK EVERYTHING
Thirty Third Tip: 9/21/2019
Not a RE tip but one for life.
Quit the focusing on the bullshit guys. Stop creating fictional arguments with people, stop getting mad that someone cut you off
Stop letting negatives control your life.
Break free and stop giving a shit.
Not a RE tip but one for life.
Quit the focusing on the bullshit guys. Stop creating fictional arguments with people, stop getting mad that someone cut you off
Stop letting negatives control your life.
Break free and stop giving a shit.
Thirty-Fourth Tip: 9/22/2019
Try to switch your tenants to ACH billing rather than going and collecting checks from them
This will save you time and can weed out worse tenants. Our leases require that they pay through ACH pay cash or check but they have come to our office
Try to switch your tenants to ACH billing rather than going and collecting checks from them
This will save you time and can weed out worse tenants. Our leases require that they pay through ACH pay cash or check but they have come to our office
Thirty fifth tip 9/23/2019
Always have swag.
I have pens, pencils, stickers, hats, Patagonias and everything else you could think of.
Everytime a broker stops by or someone I hand it out like candy.
Makes my brokers remmeber me even when they are writing.
Always have swag.
I have pens, pencils, stickers, hats, Patagonias and everything else you could think of.
Everytime a broker stops by or someone I hand it out like candy.
Makes my brokers remmeber me even when they are writing.
Thirty sixth 9/26/2019
I see a lot of people waiting to buy real estate until another recession hits.
Don't do this. Buy now but at fair prices.
So many people are hording for a recession that by the time one hits everyone will have have a lot of saved cash.
I see a lot of people waiting to buy real estate until another recession hits.
Don't do this. Buy now but at fair prices.
So many people are hording for a recession that by the time one hits everyone will have have a lot of saved cash.
Thirty seventh tip 9/28/2019
You need to learn excel as well as how to type fast.
I literally make people type in front of me in an interview to see how fast they are.
At this point excel is standard. If you don't know excel you will have problems working in business
You need to learn excel as well as how to type fast.
I literally make people type in front of me in an interview to see how fast they are.
At this point excel is standard. If you don't know excel you will have problems working in business
Thirty-Eighth Tip 10/1/2019
Always ask.
For example, I was just in the closing process of a building. Broker on the OM mislabeled how many Sq Ft the building was.
I didn't think I would get it but I asked for a reduction in the purchase price.
I got 50k Off. It pays to ask
Always ask.
For example, I was just in the closing process of a building. Broker on the OM mislabeled how many Sq Ft the building was.
I didn't think I would get it but I asked for a reduction in the purchase price.
I got 50k Off. It pays to ask
Thirty-ninth tip:
Patience is key in real estate.
On my first few deals I didn't really start making money for the first five years
This was because I used OPM which slows down the process.
But regardless real estate is not fast
Patience is key in this industry
Patience is key in real estate.
On my first few deals I didn't really start making money for the first five years
This was because I used OPM which slows down the process.
But regardless real estate is not fast
Patience is key in this industry
Fortieth Tip:
Theoretically one can remove asbestos without paying a contractor 5k+ to do it.
If someone were to do this they just need a trash bag, respirator and a lot of water.
But of course, I would never do this as it is highly illegal..... haha
Theoretically one can remove asbestos without paying a contractor 5k+ to do it.
If someone were to do this they just need a trash bag, respirator and a lot of water.
But of course, I would never do this as it is highly illegal..... haha
Forty-First Tip:
Lawyers are very important in real estate transactions.
Start to work with a lawyer your trust. Develop your relationship and they will be your wingman in every transaction.
Don't be the guy who uses different lawyers each transaction. Build a relationship
Lawyers are very important in real estate transactions.
Start to work with a lawyer your trust. Develop your relationship and they will be your wingman in every transaction.
Don't be the guy who uses different lawyers each transaction. Build a relationship
Forty-Second Tip:
As with all businesses get your systems in place.
Example Broker Outreach: Excel list of all contact info, notes on conversations and where the next step is.
Also once you have enough money get off Excel and get a CRM and Management Software
As with all businesses get your systems in place.
Example Broker Outreach: Excel list of all contact info, notes on conversations and where the next step is.
Also once you have enough money get off Excel and get a CRM and Management Software
Forty-Third Tip:
When buying a Commercial Condominium make sure your Condo docs are pro you. If not you will get fucked
Had a Condo board meeting yesterday and they want to change my point of egress my retail unit
Good thing the contract is in my favor and they cant do shit.
When buying a Commercial Condominium make sure your Condo docs are pro you. If not you will get fucked
Had a Condo board meeting yesterday and they want to change my point of egress my retail unit
Good thing the contract is in my favor and they cant do shit.
Forty-Fourth Tip:
I use wallpaper in my second-floor office spaces instead of paint.
It is easier to clean and lasts longer. Whenever I use paint I feel it gets dirty in the first month.
I use wallpaper in my second-floor office spaces instead of paint.
It is easier to clean and lasts longer. Whenever I use paint I feel it gets dirty in the first month.
Fort-Fifth Tip:
Don't use your GC for everything.
If you have enough properties make sure you have a team in place who do all the little repairs.
If you do not have enough buildings do the small stuff yourself.
GCs drain profits.
Don't use your GC for everything.
If you have enough properties make sure you have a team in place who do all the little repairs.
If you do not have enough buildings do the small stuff yourself.
GCs drain profits.
Forty-Sixth Tip:
If you are looking to do something to your building ask yourself if it will increase your rent roll. If it wont don't do it.
Your job is to increase cash flow to your building not to make your building "pretty".
If you are looking to do something to your building ask yourself if it will increase your rent roll. If it wont don't do it.
Your job is to increase cash flow to your building not to make your building "pretty".
Forty-Seventh Tip:
You can't copy and paste Real Estate success. To find success in Real Estate one must decide on the best route based on their own parameters
One's parameters include Cash available, connections, experience and knowledge
Don't copy-paste think for yourself
You can't copy and paste Real Estate success. To find success in Real Estate one must decide on the best route based on their own parameters
One's parameters include Cash available, connections, experience and knowledge
Don't copy-paste think for yourself
Forty-Eighth Tip:
I own my management company because I make a lot of money self managing my portfolio
Once you get your own group of workers who go around to each building everyday you start to make a lot of money
Simply put you pay them $20 an hour then charge tenant $50
I own my management company because I make a lot of money self managing my portfolio
Once you get your own group of workers who go around to each building everyday you start to make a lot of money
Simply put you pay them $20 an hour then charge tenant $50
Forty-Ninth Tip:
Don't let your tax certiorari lawyer screw you.
They get a percentage of the taxes they save you. What they will try to do a lot of the time is delay getting your taxes lowered.
They do this because it makes their commission a lot higher.
Don't let your tax certiorari lawyer screw you.
They get a percentage of the taxes they save you. What they will try to do a lot of the time is delay getting your taxes lowered.
They do this because it makes their commission a lot higher.
Fiftieth Tip:
When you start to buy work trucks for your management company don't buy Mercedes Sprinter Vans. Instead buy Ford Transit Vans.
Mercedes require higher maintenance and a higher purchase price.
Forget the flash instead go for smart business decisions
When you start to buy work trucks for your management company don't buy Mercedes Sprinter Vans. Instead buy Ford Transit Vans.
Mercedes require higher maintenance and a higher purchase price.
Forget the flash instead go for smart business decisions
