101. Leveraging Vision to Overcome Challenges with Jim Lee

Connect with the host:

LinkedIn: https://www.linkedin.com/in/brandon-e-jenkins/

Website: https://www.birchprosper.com/

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About the guest:

Jim Lee received his Bachelor of Science degree in Economics from UCLA in 2010, and started his career as an inside sales representative for LoopNet/Costar. As a top sales rep, he quickly learned the importance of having multiple streams of income. Now through real estate syndication, he has invested in over 600 units as a general partner/limited partner.

Connect with Jim Lee: 

LinkedIn: https://www.linkedin.com/in/formosainvesting/

Instagram: instagram.com/formosainvesting

Facebook: facebook.com/formosainvesting

Episode Highlights:

✔️ Transition from Sales to Real Estate Syndication

✔️ Mindset Shift from Saver to Investor

✔️ Scaling Real Estate Investments

✔️ Importance of Networking

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Transcript

SPEAKER_01 0:02

How successful would you be if you had the blueprint for building wealth as a real estate investor or as someone who acquires small businesses? If you want to move the needle financially in your life, then you need to understand one thing: the capital stack. I'm your host, Brandon Jenkins, and this is where your journey to financial freedom begins. Hello everyone, what's up, and welcome back to the Capital Stack. I'm your host, Brandon Jenkins. I'm super excited to invite and to have our guest um on the show today. We'll kind of share his backstory. There's a lot to discuss here. One of which to me that really stands out is that he's someone who has the professional background of actually working in the commercial real estate industry, but then also investing in it. And I, as ironically as it might sound, uh, or as counterintuitive as it might sound, there are a lot of people who are professionals in the commercial real estate um space, but they don't convert into being an investor in the space. And so I like to kind of get his take on that and a few other things that are very, very important about his background. So our guest for today is Jim Lee. Jim, how are you doing today? I'm doing well. Thanks for having me on the show, Brandon. Absolutely, man. Thank you for being here. So uh Jim graduated from UCLA in 2010, very procedure school. Um, and he started off as a sales rep for um LoopNet and Co-Star. So um he had great success, excuse me, there, um, uh where he had a$50,000 sales incentive bonus that he then used to roll into an investment um with his first condo. So we'll kind of dig into some of that. And fast forward to today, he's had success as a real estate syndicator and he's invested in over 600 units in just two years. So there's a lot to talk about there about scaling, which is also something I think is very, very critical and very doable in this space. So, Jim, with that, maybe share some of your journey and your background uh with us.

SPEAKER_00 1:50

Yeah, absolutely. So, like you said, um I met obtained my economics degree at UCLA back in 2010, which, as many of you know, that that's right after the 2008 subprime mortgage crash, followed by 2010 European debt crisis. So um it was a really tough time for me to find a job. But I was fortunate enough to land a job uh working as an inside sales rep at LoopNet. Um, and for those who don't aren't familiar with Loopnet, it's basically Zola for commercial real estate. Um, I was able to speak to real estate investors, agent, lender, property manager on a daily basis and learn the importance of having multiple streams of income. So I started acquiring real estate for additional passive income. And eventually I built a sustainable real estate portfolio that I managed to break away from my W-2 job and start a career in real estate syndication.

SPEAKER_01 2:39

Awesome, awesome. Thank you for sharing that and congrats on being able to break away because not everyone can do that. So I want to congratulate you for that, man. Thank you. That's a huge accomplishment. And so, um, okay, so I want to talk first about the experience that you had um kind of professionally, right? Because uh, like I mentioned, you were able to interface with and engage with a lot of people who are very active um on the investment side of the business. But um, am I off base and saying that at least for me, my observation has been that other professionals in the commercial real estate space don't always uh then you know switch into being an investor in the business. Have you have you observed that as well, or am I off base on that?

SPEAKER_00 3:17

Um, I think I speak to uh people from various backgrounds. There's people that have always been investing since the beginning, or there's also people just agents representing for buyers. Um, so you see two sides of the equation, right? Um, as a I I you know, you you see individual investors like individual syndicators that would call in to call uh look for deals, or um, you also have um real estate agents that call in to use the platform as a as a networking tool, right? Um, to to connect with other real estate agents and to connect with other um property managers, lenders, people that might help them out. So uh, you know, you you get to talk to uh people from coming from different backgrounds. So that's that's what it helped me a lot to learn everything from uh you know, from lenders, property manager agents, and investors.

SPEAKER_01 4:11

Yeah, that makes sense. I I think it's it's really cool though that you kind of had, you know, all of the pieces, I'll call it right there, sort of at your disposal. And you had the data to back it up. You know, there a lot of people don't really have exposure to um some of the data that really makes the industry work. And I think, I think, you know, interestingly enough, uh, you know, this is a relationship business, but the decisions are still driven by data when it comes down to, okay, should I, you know, what can I do with this property? You know, how much um what's the upside here? What's the market look like? It is, it is really data driven. Um, and so, you know, what what for you then, what caused like that mindset adjustment to say, uh, you know, I like working in this in this space as a sales rep, but you know, let me make the adjustment now be an investor. What was there kind of a trigger or something that really said, you know what, I need to do this?

SPEAKER_00 4:56

Good question. So at the time in my early 20s, I I don't know where I got this from, but I always wanted to start investing young. Um, I think it's because of the friends I surround myself with. All we talked about was how do I how do we get in the door? How do we start investing stocks, real estate, anything that's out there, right? And I just happened to be working for a real estate company, uh, one of the biggest. So I I thought, why not start there? Because since I'm already learning from there, um, you know, I I feel like I have uh an advantage over others. Um, not only that, I also have this passion for real estate since the beginning. I always thought I always believed in it. Um, I read good things about it, you know, um, it's backed by hard asset, you know, I it's tangible. So I like all the ideas that a real estate has to offer. And you're not just buying it for yourself, you're buying to house other people here, you're buying to um help others as well, put a roof other uh over others, people other people that need it. So I and you know, I can go on and on because I'm a real estate advocate, but you know, you get tax write-off as well. So there's so many benefits. So the right how you look at it, I I I always believed in real estate. The more I study, the more I feel like this is this is gonna be with me long term, and you know, I rather have most of my portfolio in real estate.

SPEAKER_01 6:16

That's incredible. And I would I would say you made the right choice, is what I think. And so so um now let me let me ask so because you because you mentioned it a couple of times there, that you always believed in real estate. Did you have some exposure to it uh maybe earlier on that triggered that belief, or really just kind of came from within and you just were naturally passionate about it?

SPEAKER_00 6:33

Um, I would say both. First, uh again, I was fortunate enough to find uh you know worked at Loop NAS my first job. That really helped out a lot. But second, I think um my parents had always owned real estate, not rental properties, but we actually lived in way out there in Palmdale, not now in Los Angeles, which is like 45 minutes away from um Los Angeles. And uh, truth be told, my parents wanted when we sold that house and uh well, we're when we're about to sell the house in Palmdale, I wanted to manage it. I told my parents, hey, let me get some experience, let me help you out. And they said, Okay, you can you can do so and see how it goes. Um, so um I did that. That that's how I started first. Um, but it was just to manage the property, it wasn't that much experience into buying, selling, going through the whole process of uh, you know, acquiring uh a unit and actually going through the operation, it was more of just helping family out.

SPEAKER_01 7:29

Gotcha, gotcha. I mean, but you know, it's it's I would say that that is good experience though, because it's you know, most people I can tell you myself, I I had zero exposure to um, you know, real estate that I could sort of then leverage into actually investing in being a true investor in real estate. And so and I would say most people probably don't. And so for me, whenever I um come across someone that actually had some exposure to it, they tend to do really well um in in this business. And you know, I think it's partially because you at least can visualize that, hey, this is a good vehicle to build wealth, or hey, this is you know something that is very familiar, very tangible. And um, although it is a simple, you know, there's still some things you have to be careful of when you're either managing or acquiring the property. Um, so and I think that's really that's that's really incredible. Um, and okay, so so you mentioned that um, you know, actually before we started recording, you mentioned the purple Bible. And so talking about the uh uh Rich Dad Poor Dad. Maybe talk about that a bit. When when did you kind of pick that up? And when did uh you know, what did it speak, what did it say to you? You know, it always it tells every each one of us something different that we're like, okay, this is the reason why I need to get in this business. So what what stood out for you?

SPEAKER_00 8:39

Yeah, absolutely. So it taught me a lot, actually, uh as much as pretty much like most people. Um and what happened was uh so back in 2015, I acquired my first property, uh small two-bedroom, one-bathroom condo out in California, uh Ontario, California. And uh before I acquired this building, I I had absolutely no nothing, no knowledge. I have I haven't educated myself in any way. Um, I just wanted to get started. Um, even though I've been in the in working at LoopNet, I've learned a lot. I I still felt like I lacked education. So after I acquired the building, I I found out how much I didn't know. I picked up the purple Bible book, and uh it taught me, you know, to shift my mindset uh from savers mentality to leverage. Um, and I can explain a little bit about that. I was born and raised in Taiwan with a savest mentality, you know. In Asian culture, we've been taught if you can't pay for something in cash, you can't afford it. Um, you know, in our mind, debt is slavery and cash is freedom. So I've always lived life in that comf comfort zone um of not borrowing, and because that's what I see is what I believe. My parents have taught me that, and um been raised that way. And and so once I started reading the book, I realized how important it is to use leverage to amplify your returns for tax uh purposes. There's just so many benefits you get from leverage. And in so in real estate syndication, same thing, right? You're using other people's money, not just the bank's money to make more money, and and and it's where uh you can scale it so that everybody has a piece of pie to share. So that's the beauty of it.

SPEAKER_01 10:17

Yeah, absolutely. And I think that's an excellent um, you know, the point that you just made there because being able to make that adjustment from that sort of savers mentality to now an investor and one who understands sort of the difference really between what I say, you know, kind of bad debt versus good debt. Um, you know, that that's a fundamental shift. Um, it's that that needs to be made, but it is a difficult one to make. Um you mentioned in 2014, uh, 15 you bought your first property. And that was the same for me, actually. I mean in 2014 was when I first started to looking. And in 2015, I actually bought my first single family property and everything, you know, kind of went from there. Um, I really struggled with saying, you know, with with uh taking on some debt uh in order to buy that that property. And for me, it was actually it was before I actually bought my my first primary residence. Um, and so it I struggled even more because it's just like, man, I can't believe I'm about to put this much you know capital down. And I ended up paying putting like half of it down in cash and then just getting half um with debt. And so after that, of course, I did, you know, 80% or near 80% loan to value on each subsequent property. But but that first one was challenging for me, you know, and for me, it wasn't until I had a renter in there and actually paying, you know, uh rent on the property and I had enough left over each month that that cash flow was for me what really stood out to say, okay, I made I made the right call. Like, was there something for you that you know, even in even in struggling with it, what made you say, ah, you know what? Okay, this is this is good. You know, I struggled, but now I'm I'm over that struggle and I'm ready to sort of keep moving forward with it.

SPEAKER_00 11:46

Yeah, um, so because I put all the eggs in one basket, I used cash offer to buy this source though. And it actually also took me a year to close. That was the challenging part that it took the bank a year to give me a decision and they came back to counter a year later. Oh my god, yeah, it's ridiculous, right?

SPEAKER_01 12:04

Oh my goodness, yeah.

SPEAKER_00 12:05

So I just I just gave them something just just you know, just to get the deal to the finish line because I didn't want it to wait another year. Yeah, um, so uh that so that was one challenging part, but the to answer your question, um, when I picked up this condo, I did everything from A to Z. You know, I did I dealt I dealt with the tenant, toilet, and trash all by myself. And I I realized I was super active involved that I don't want to be that actively involved, I want to be more passive. And so I started to build the system, you know, um, delegate tasks to property manager and also create a list of vendors that I can go to. And and eventually I I I I have the system process set up, and I was thinking to myself, why can't I, if I can do this with one condo, why can't I scale it to 100 plus units? It doesn't, it's I I feel like it's it could, it's probably about the same amount of work, so it's just I think it's just more of an obstacle, like a fear in in your mind that you know you're not thinking big enough sometimes. And so I started to um go out to network, go uh join mastermind groups and found found a business partner and who I was able to leverage, and that's how I got into syndication.

SPEAKER_01 13:14

Yeah, that's that's incredible. That's incredible. And let's and so let's now kind of in and continuing with this, because I'm gonna talk about some of the networking um that that you that you were able to do. Like, so what what form did that take on? Was it kind of like a meetup or seminar? Like what what what types of um exposure did you sort of have to the real estate community? I'll call it after that.

SPEAKER_00 13:33

Yeah, yeah, absolutely. So um before I quit my W2 job, I actually obtained my real estate license. I did the realtor for two years and found that it was a good fit. So uh in lock during lockdown, I my hands were tight behind my back, couldn't do anything, so I started to explore syndication. It was actually one of my investors that introduced me to a radio show podcast show called uh Rail Real Estate Real Real Real Estate Uh Guys radio show, uh run by two fine gentlemen, you know, Robert Helms and Russell Gray. They pitched about syndication almost every episode on their show. Yeah, so um I was like I was so intrigued about it. And so uh as soon as we opened back up in 2020, I went out to the secrets of successful syndication event. Uh, went there a couple times, went to investor summit. Um, that's how I met my business partner, and then eventually, uh, once I met my business partner, he he he goes out to events more than I I do. He goes to like he went to 20 events last year. So every event he goes to, he always invites me. So I just tag along. So we've been to the the event you've spoken at, uh multi-family investor nation. We went to Hunter Thompson's Raise Capital, uh uh Raismaster event. Um, and then I've also been part of uh Sumrocks group uh event as well, and same thing with Michael Blanc. So pretty much, and and we partner with Think Multifamily, so pretty much all everyone in the industry.

SPEAKER_01 14:59

Man, that that so that's good because you know, I I share with people all the time that um, and I just had a conversation actually about this. And um, one of the best ways, in my opinion, to uh get into this this space, even if you sort of have kind of a wall up, you know, you know you're sort of interested in it, but you haven't taken the action to actually get into this business. One of the best ways to do it is to go to a conference, go to a seminar, kind of see what other people are doing, and then it'll help you. Like I think for you, you you were you know already sort of brought in, but this is just even a message for the listeners. Um, you know, if you're kind of not a hundred percent sure, but you want to see kind of how things work or how the people are, go to a conference, go to a seminar, go to a meetup, and just kind of see that okay, this is real. These are these are normal people, but they took uh uh made a decision and they took a certain path that few take. But when they take that path and have success in it, then they do really well. And it literally is life-changing. But you can but you can sort of have a spark just kind of set that off just by going to conferences. So it just, it just I'm over I was over here smiling as you're saying it, because it really for me, um, I I think that that is sometimes the key. That's what worked for me. You know, I I I I I went to I spent about a year doing the same thing. I went to a bunch of conferences and I looked at my calendar and I was like, well, my calendar was pretty empty. Let me fill it up with some calls. And then after that, I just kind of went from there. And so I think that um, you know, I think it's really impressive to then turn kind of, you know, hey, let's do this and see how it works, and then turn that into action. So I want to talk about how you uh you mentioned how you met your your partner. So you met you met your partner at a conference, or um okay, you did. So so maybe talk about that, right? Because I want to talk about uh the the impact of networking and even intentional networking, since it's um, you know, it's it's served you well. So how how are you able to do that? What would you maybe advise people to do to sort of help themselves out?

SPEAKER_00 16:48

Yeah, so um you hit it right on the spot. I feel like the first couple of networking events I I went out there just to explore, just to get familiar, get familiar with the space and with the people and with what I'm getting myself into to begin with. Um just just basically just trying to educate and get get knowledgeable in in the field that you're trying to get yourself into. And so that's basically what I did for the first couple of times. But then after you know, going out for uh two, three times, I feel like okay, almost a year has gone by and I still can't syndicate a deal because I don't have track record, I don't have deals, I I have a list of investors that I built up, but what can I do with it? So I was trying to figure out um how can I add value to other people and and also to be able to leverage other people's track record and experience. So um I figured, well, I have I'm able to raise some capital. Maybe there's something there, and maybe I can still continue to go out and and look for uh somebody that that complements my skill set and something that that you know they they can use my value, you know, that the value that I I can add to them. So uh eventually I made a commitment, a huge commitment to go to investor summit, which is the realistic guy radio show's biggest event. They host it once a year and they they they get like people like Ken McElroy, you know, Robert Kiyosaki, all these heavy hitters to come join them for 10 days in Belize. Um, it's like 10,000 to be there. It's it's really to invest in yourself to you know just um uh be with these people and and and you know learn from them and and and share knowledge with each other and network. And so that's how I met I that's how I met my uh my business partner because he went to this event with the same intention of finding a business partner. He had he has five kids, he's done syndication for four years, he does everything from A to Z. You know, you can imagine he raises capital, under rights deals, manages a deal, everything right by himself. So I was really impressed. And he said that he's it's he's running out of time, resources, and money. So needed someone to help him, you know, uh raise some capital. So I I figured okay, this is great. And and and so we both were very intentional by going to this event because his wife suggested that he goes to find help him find a business partner. I I went because I really needed someone um to help me because it took me literally two years to finally syndicate my first deal after meeting him. Uh we kind of delayed for another like half a year to finally um syndicate together.

SPEAKER_01 19:25

Well, well, that that's incredible. And and again, I mean, yet another um huge reason to attend these kinds of events is because you can actually meet some really uh you know outstanding people that can then turn into a partnership. Um and so, and in fact, I think that's one of the best reasons. You know, sure you can meet other people who are investors and potentially kind of build up your list as well, but you go to meet some people who are really solid and who've had success at doing with the thing that you want to do. And so a lot of times they'll say, hey, you know, as long as you can sort of make your value proposition clear as you've been able to, then you can now partner with them. And so um, and I want to actually talk about that, right? Because you mentioned that for you, one of the key pieces that you brought to the table was your ability to raise capital. And one of the things I like to talk to my, you know, to tell my clients is, hey, listen, you know, you have to really position yourself and make sure that your brand and your name and that and that, you know, that you sort of have some things in place in order to be able to attract capital effectively. Because I I find that that is one of the best ways to then partner with someone who's a really strong partner. So what are some of the things that maybe, you know, that the that you are able to do to sort of bring that right to the table, to bring capital to the table, um, and and and and add value to a team in that way. So, what are some things that you do to help kind of source capital?

SPEAKER_00 20:38

Yeah, absolutely. So I think marketing is the biggest part. Um, it's the the sole reason why I joined the mastermind raise master. Um, they teach us how to raise more capital, right? The name says it all. So um upon joining the program, I had no idea about marketing. Uh all right, nothing. I've I come from a sales background. And once I joined, I realized holy moly, I there's a lot of things I gotta build, right? You you got you gotta be on podcasts, you gotta write newsletter, you gotta, you know, come up with an e-magnet for your website. Um, you know, there's there's so many things that you can put yourself out there, uh, using the internet and social media and so forth. And so uh there's just so much to work on. Um, but you know, I that's that's how I add value. That's it, that's that's how I continue to get better at raising capital. Because I um when I was a realtor, I started uh real being a realtor by doing what I used to do best, which is inside sales. And that was the mistake I made was you know, I I sat in in in the house to make phone calls when instead of going out to meet people, which is it eventually it kind of led to that, right? As as a syndicator, that's what we're doing now. Um, so I I that's how I built up a list of investors because of all the apps and team owners, all the rental buy uh or units uh owners that I called. And um, so that's the list I started. Off with um with that list. And then eventually, once I started creating my marketing platform, I started feeding them newsletters and nurturing them. I started going out to events, more and more um conferences and mastermind groups and and and just constantly put myself out there to network. And that's all I do now. Instead of making phone calls, I'm always out uh going to local real estate meetups and volunteering at meetups as well.

SPEAKER_01 22:26

Yeah, that that's that's really good. I mean, I think that's one of the best strategies, strategies to sort of uh be able to you know attract more capital to you because the thing is, you know, what I tell people is listen, it's very simple. You might have people who knew you for something before, but as soon as you make the decision to say, okay, I want to be uh excuse me, a syndicator, then um you have to then pivot to hold on a second. Sorry, but you then have to um uh pivot a little bit and make sure that um you're putting out information so that people so that it's clear to your network that okay, you know, Jim is a syndicator, you know, Jim is is you know presenting opportunities to partner on deals because um otherwise they'll say, well, Jim, I didn't even realize you did this. And so I think it's you know, I like to share with my clients and my network as well is that listen, you know, you you're gonna have to have sort of this change of of persona or brand, at least in terms of what you put out there, to make it clear that, yeah, I'm this is my passion and this is what I focus on, and here's how I can help you, you know. And then um, you know, after that it becomes much more uh straightforward to have the conversation and say, hey, listen, here's an opportunity, you know, or let's meet and let's see what are your needs, you know, and to have those kinds of conversations with investors. So I feel like that's one of the things for a lot of people that's sort of the uh um an adjustment that they have to make. It is a sales and marketing thing, you know, 100%. Um, if if you're in the syndication business today, you know, then you must you have to market yourself. You have to make sure people know what you're doing. And it's not, and it's not to be, I don't know, it's not to be cheesy or corny or anything like that. It's just to be genuine, to make sure that they know what you're doing and how you can help them. And um, I think you mentioned it very briefly there about being able to make an impact on um multiple, multiple people. And to me, I think that's that's the key behind this. That that's one of the reasons why we're so passionate about it is because you can make a positive impact on the you know, the your tenants, you can make a positive impact on yourself financially, you can make a positive impact on your investors. And so um, for me, the fact that it's a true win-win in that way makes it that much easier to say, you know what, I might not be the type of person who would normally put this stuff on on social media, or might not be the person who would normally, you know, sort of uh um share this much detail about what I'm doing, but I'm gonna do it with this business because I can make a positive impact with everyone that it touches. And so I just I just feel like that's something that's super important um about this, about this industry for sure. Um, and so so let's make the um I'm sorry, we we about to say something. Sorry.

SPEAKER_00 25:00

Oh yeah, yeah. I say I yeah, I could I second that for sure because you know, I think being able to help others and not just myself reach financial feet on the ability to give back to everyone has been extremely has been extremely supportive to to help my mentors, help reach their goals faster, to you know, my parents who made their sacrifices to bring us to the land of opportunities and you know to all the friends that believe in me and through thick and thin, I I I I am surrounded by people that it's continue to inspire me to be a better per version of myself every day. So this is the this is the the way I get back is you know to teach them, educate them about everything I know about syndication. Yeah, that that's a beautiful thing.

SPEAKER_01 25:37

And and you're right, I think it's I think it is genuinely fulfilling to do that. Um, and so uh so okay, so let's let's let's get back to sort of connecting um you know the dots here then. So um you're you're now a uh syndicator, full-time syndicator. And so um let's talk about maybe the markets then that you that you focus on. So what's what's your approach to then finding okay, where where you're going to start looking for deals?

SPEAKER_00 26:02

So my business partner, he mainly works on the operation side, and so he's always out there uh networking with other partners. Um the market, I would I wouldn't say the market leaders, but definitely uh someone who's been in the market, who's been uh out there doing stuff, uh built a team, boots on the ground for years. And so that's that's what we do. Um, because we we wanted to syndicate how here in California. He's he started off syndicating uh uh multifamily apartments in Long Beach, and because of lockdown, because of eviction moratorium, we uh he shifted his uh uh investment strategy to look elsewhere out of state, where it's more business friendly, landlord-friendly, you know, some bell states, all those matrix that we all look for, right? You know, population growth, job growth, and so forth. And so uh we just happen to um come across a lot of deals in Florida and know a lot of syndicators out there, some people that we can trust. Um, so the first deal was in Laurent Orlando, the second deal was in Jacksonville, and right now we're currently working on the third deal, which is in Dallas, Texas, downtown Dallas.

SPEAKER_01 27:11

Okay, okay, that's really good. Uh all great markets. And so, so the way the way that the the partnership is, it sounds like then is you were both allowed to then work on your strengths. It sounds like right. You so he's working operations, you're kind of doing investor engagement, investor relations, and then raising capital, which I think is, you know, to me, that's the way a good partnership works, you know. Instead of kind of stumbling over each other and overlapping, you have uh, you know, here's my piece, here's your piece, let's bring it together and then let's let's make a good deal of it. Um, and so and so so um I forgot whether I mentioned in the intro, but then what's what like roughly kind of how many deals are you in now? Just uh just just high level.

SPEAKER_00 27:48

Yeah, I'm only in two deals right now, working on the third.

SPEAKER_01 27:50

No, no, no, I wouldn't say only.

unknown 27:52

I mean two.

SPEAKER_01 27:53

I mean, I mean seriously, because look, here's my thing. Most people will never get into even a single deal. I mean, that's that's the truth of it. What whether and that's whether it's uh passive or active. Um, I can't tell you how many people, you know, I've come across, you know, since I started that that haven't gotten into any, but they but they've you know been reading books and they've been you know attending events and they've been you know listening to podcasts, but they just haven't taken the action. So I mean being in two deals, I think that's uh that to me that's that's incredible, and that's a good uh an outstanding start. And so um, so so no, I think that's good. And you mentioned uh that a lot of this, I guess, is post-pandemic is as well, sort of during pandemic and then post-pandemic is when you really got kicked off, which I think is also uh very impressive. And it to me, it says, you know, this is for the listeners is that listen, once you make the decision to take the action and to get started, it's it doesn't take as long as it might seem like it would, you know, to as long as you go about it the right way, like you have, then um, you can actually compress the learning curve quite a bit, right? Um, so okay, so I did want to ask now, so you you've you've once you um and your partner, you both took the time to attend a lot of seminars and meetups. Did you kind of settle on like maybe one mentorship uh program or anything like that that you are now part of, or are you kind of still sort of filling out which which one and just attending events or what what what did you kind of land on?

SPEAKER_00 29:14

Yeah, my business partner, he's part of the inner circle club with the real estate guy. Um, that's like the highest tier that you can get in. It's like 25,000 a year and two years minimum commitment. Um, I joined Race Race Master. Um, that's the mastermind group. I wanted to join Syndication Mentoring Club with him, which is belongs to the same group, real estate guy. Um, but I wanted to just, I guess, divide and conquer, like learn from other network and see what what they have to offer. And uh, and it's been working well for both of us. I think he's building, he's definitely uh able to search more uh top operators to by joining inner circle. And I'm able to learn everything about marketing and raising capital from Race Master. So it's good, it's been good for both of us.

SPEAKER_01 29:58

Yeah, now it sounds like I forgot that you actually did uh mention that you were in Race Master, so sorry about that. But yeah, yeah, yeah, no, that's that that's good. I mean, I think that's the way you should do it, right? Because if you both join, I mean, there are pros and cons certainly to joining the same, but if you join the same, then at least the information you would both just be getting the same information. So it's like, why not sort of split? And then you go here and focus on operations, I focus on my piece, and then we get education and join the group that will reinforce that. So I think that's very powerful. Um, so so yeah, so I did want to ask now, in terms of the direction that you're kind of heading in um now, you and your partner heading in now, what what are you currently focusing on? And um and what's kind of what's next for you guys?

SPEAKER_00 30:38

Yeah, so after we acquire two buildings last year, uh the one in Orlando is 200 units, the one in Jacksonville, it's a portfolio of two complex, 400 units. That's how you add up to 600. Um, those those were just uh improving the uh efficiency efficiency of operation. Um, the first deal it kind of went south because when we took over the project, we had 100 work orders backed up. And uh we went kind of too aggressive with our um renovation. We renovated one third of the apartments in half a year. So wow, yeah. So our marketing didn't catch up, our occupancy rate was at 82, 81 percent at the end of last year. So we were uh it was eating our cash reserves. We're we almost had a capital call beginning of this year. Um, but you know, the lead sponsor decided to put the pressure on the GP um instead of the LP. So we had to cough up some money. But in the end, because of the relationship he the lead sponsor had built with the lender, they reasoned uh the lender reserved uh released some reserve for us, so we didn't have to put in any money. So we're able to weather the storm. Now our occupancy rate is up that 94%, which is good for that deal. Um, Jacksonville, same problem. We had property management issues, so we had to switch property management. And we both for both deals, I'm pretty sure you heard of them. We used REST Prop, which they have like two billion dollars asset under management. So it's very it's very weird to to see that how a company that scale would uh would not perform what they say what they're what they're going to do. So that was a little bit of a hiccup for both of those deals. And so that's that's what we're just working on. It's it's this year, it's really tough to get any deal to pencil, as you know. Interest rate is that is still high, and sellers expect expectations still hasn't come down, except for the ones that are underwater, which is the one the deal that we're working on, the third deal in downtown Dallas, Texas. Um, class A building, 200 units, and uh we bought we acquired this building for 500,000 less since uh uh since the last buyer bought it in 2019. Yeah.

SPEAKER_01 32:49

Wow, that's awesome. Yeah, yeah, you're you're right though. That we're we're definitely going to see more deals like that um here in the near future. Um, at least I know there's some signs of depending on where you are, the things are making a a change, but um the gap that that gap between the sellers and the buyers is still there. Um, but uh, but yeah, I I think I think um we're definitely gonna see some deals that where you can uh acquire them below intrinsic value, essentially. Um, and so um I did want to touch on the point though that you mentioned, because this is it, this is an important one. You know, so when you get into a deal, and this is for, you know, whether you're a passive investor or an active investor, it's something to be aware of. You get into a deal and then you implement your CapEx plan, what you're essentially talking about is, you know, hey, we we we've um established a cadence for how often we are going to upgrade these units, but you have to also have then a plan that aligns with that pace. Because if you don't, then um you're and you're and like I think you mentioned it, you that your marketing couldn't keep up, I think is the way you phrased it. Essentially, you'll have you know units that have been upgraded, but you might not realize the full up um upside and rents for those units. Um, and so that's something that people don't often, you know, you know, even as a as a passive investor, it's something that to be aware of that um it's it's not always easy to to to do that, to say, okay, here's our pace for the number of units we're going to turn um or upgrade in a month or in two months or three months, and um, here's the rent we should get. But you almost need to test it, you know, you almost have to like grade and do a gradient, and then once you've proven that you can actually get them on a certain pace, then maybe bump it up and that kind of thing. So, but it happens. It's it's not even something that's it's not like it's uncommon and that it happens a lot, um, particularly when you know we step into now an economy or a um a phase of the cycle like we're in now, right? So you kind of we don't we don't have a crystal ball, so it's just no way of knowing, you know, whether something like that will work. But but um just wanted to make sure I touched on that point because I think it's a really good one for sure. Um yeah, no, so like I said, I mean it's really good kind of to hear kind of direction you guys are are going in. You know, you it's just to me is very impressive to see kind of within the amount of time that that you've made the switch uh switch to then full to being a full-time investor and the success that you've had and you know, and a few lessons learned there. But I mean, they're they're lessons learned, you know, at least you at least you you've kind of taken them in and documented them. And so I think that's the important way to go about it. Um, so we're getting close to uh to close uh here, Jim. But I wanted to ask you uh something here. This is the actionable tip portion of the show. And so if someone is listening to this and they've they've heard what you said, they're really excited, you know, they like everything that they've been taking in, but they're hesitating, right? So they're a little reluctant, a little slow to get in the game. Um, what's something that they can do to take action today?

SPEAKER_00 35:36

Um, I would say just the first thing is definitely find something that you are very, very passionate about, like things that you know you you can do, wake up in the morning and do and not consider it as work. That's first thing. And I know that's hard for most people, right? Everybody, I feel like uh a lot of people, especially when I got out of the college, that I that was my biggest problem. It was to figure out what I want to do for the rest of my life. And that's always been a question until I found syndication. Um so that's one thing, and and then the second thing is you know, once you once you locate that, once you're able to find that, have a vision for it, right? Like, like have a very, very clear, vivid vision of it. Because the clearer you get to that, it went the clearer the vision becomes, the the the the more you think about it, the more you think about them, the more you manifest it, right? And people talk about writing down goals because when you write down, it's going to register with your head more clearly, more vividly. It's the same thing, same concept. Writing them down, write down your goals, write down your vision, and so forth. Have a vision board, right? Read it to yourself um every day, and it's going to manifest. And and and and you you'll see, you'll you'll you'll you'll begin to see yourself. Uh things are going to happen in your life where there's going to be opportunities that pop up, and you're just you're just going to have to take it. And so that's that's one thing that I would suggest to the audience, because that's I think that's the hardest part for me is to get that down.

SPEAKER_01 37:07

Yeah, that that's a phenomenal um point and an excellent piece of advice. And I would agree with that, you know, to for the listeners, please make sure to get, you know, have a uh establish a clear vision on what you want, what do you want to get from this business, and then write those goals down. Um, you know, another in my opinion, another thing that having a clear vision will help you with is when you have rough times and when you hit like tough spots in the business, it'll help you see where you want to go. Because, you know, I used to work in in uh out in the oil field and in rig at rig sites. And I remember one sign that I drove past um that said aim high and steering. And what they really meant there was if you aim high and steering and where you're looking when you're driving, then you're you're less likely to make these little small, minor adjustments that can cause your car to be unstable. But instead, you're looking farther out and you're kind of focusing on, you know, where you're going. So you're gonna make smoother turns as it as it turns out. Um, and so just that's sort of the similar type of thing. It's like keep your eye on you have a vision on where you want to go, focus on that. And then some of the little bumps that you might have, they're not gonna knock you knock you off track because you know exactly where you're going. Um, and so uh, and it will manifest, you know, you because because then you'll make you'll make these decisions along the way that will course correct you. So I really think that's very, very powerful advice, Jim. And I appreciate that. And I'm sure the listeners do as well. So um, for people who want to reach out to you, hear more about you, see more of you, how can they do so?

SPEAKER_00 38:34

Uh, they can visit my website, formosainvesting.com. Uh, I have on there, I have an ebook, you know, uh uh investors due diligence list, uh, investor one-on-one, you know, a lot of free materials that they can access if they want to learn more about real estate syndication. And then I also they can connect me on uh social media links, Facebook, Instagram, LinkedIn, at Formosa Investing.

SPEAKER_01 38:58

All right, awesome. I'll put those in the show notes. And Jim, once again, man, listen, thank you so much for being on the show. Um, this is just, you know, I got a lot of uh value from this, and I'm sure the listeners did as well. So I thank you for your time. Yeah, thanks for having me. As always, thank you so much for tuning in to the show today, brought to you by Bridge Prosper. If you enjoyed today's episode and you'd like to learn more about commercial real estate investing, please like, subscribe, and share. And we'll see you again next week. I'm Brandon Jenkins, and this is the Capital Snack, where we help you learn, apply, and