In this episode of Cash Flow Pro, we talk with Adrian Pannozzo, Founder of Executive Properties Capital. Ten years into his career as a police officer, Adrian began to investigate his pension and how he could maintain the lifestyle he wanted...
In this episode of Cash Flow Pro, we talk with Adrian Pannozzo, Founder of Executive Properties Capital. Ten years into his career as a police officer, Adrian began to investigate his pension and how he could maintain the lifestyle he wanted even after he left the force. After thorough research, he decided the answer to that question was cash flow. Adrian is here today to impart his wisdom to us.
Executive Properties Capital is a joint venture business that strives to make real estate investing easy and rewarding. Their focus is to help individuals grow their portfolios and achieve financial freedom.
In this episode, we discuss:
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Casey Brown 0:00
If not Panozzo can always Oh yeah. Hey there and welcome to today's episode of cash flow Pro, your daily real estate investing podcast and YouTube channel. I'm here today with Adrienne Panozzo of executive properties capital. And Adrienne and I were just talking a little bit before the episode and we were talking a little bit about the burr method that everybody's so into and wants to talk about nowadays. And Adrienne, how are you today?
Unknown Speaker 0:37
I'm awesome. I'm awesome. Thanks for having me on.
Casey Brown 0:39
Absolutely, man. We're always glad to have have our good friends in Toronto on our on our podcast so we can see what's going on up there and get a feel for, for what real estate's doing are pretty much everywhere else. But I'm sure you have deals in the in the States. But anyhow, so Adrian from Toronto, and he's going to tell us a little bit about his backstory, where he came from, how he got to where he's going, or how he got to where he's at and where he's going from there. So Adrian, tell us a bit about where you came from.
Unknown Speaker 1:13
Yeah, yeah. Thanks for sure. So, at the young age of 23 years old, I was hired as I was hired at the police department, in, in the GTA, and something I always wanted to do while I was a young guy, ever, like, way back in grade one, I always look at cops. And it's like, yeah, I want to do that. I want to do that. So I got hired with the police department at 23. And both 10 years into my career. I tried to 10 years on, I started thinking, okay, so when I retire from policing, what do I want to like? I want to live the same lifestyle, even though I'll be on a reduced income, because I'll be on my pension. So how do I kind of live the same lifestyle even after I put in my 30 years on the job? How do I live that same lifestyle, so I thought, Okay, I need to bring in more income. And I thought what, you know, safer place to invest money in other, you know, real estate, okay, if I get one or two rental properties, produce some cash flow. And from that, I can, you know, when I retire after my 30 years, I'll be able to live the same lifestyle as I do now. So I was 30. When I was 3635 years old, I bought my first rental property. And you know, back then we didn't have any money. We didn't have any money in the bank at all. But we did have equity in our home. So we refinanced our principal residence, pull that equity out on a line of credit. And we use that I want to say, you know, back then we started with, I think we were able to pull up 200 grand, on a line of credit. Sure. And I used that 200 to buy my first three rent, I ended up buying three, but oh, I remember I started thinking I just want one or two bit of cash flow, subsidize my pension while a 200 to buy put my down payments on three, and three, you know, things were going well and stuff like that. I was still a cop. So I'm buying,
Casey Brown 3:33
what year what year is this?
Unknown Speaker 3:37
So it was about 11 years ago. So what am I going to do? So 2011? Okay, okay.
Casey Brown 3:44
We talked about we talked pre Oh, seven post Oh, seven. Seems like that's the big dividing factor. So I always want to try to see what we can how we can nail people in figuring out what which time period they're talking about.
Unknown Speaker 3:57
Yeah, so I want to say it was around 2011 2010 2011. Okay. Yeah, we bought those three using the line of credit. And again, still working as a cop, raising a family, the whole nine yards, taking care of the properties, meeting new tenants, screening tenants, cutting the grass, doing everything on my own, while still on the on, on the police force. And then, so cash flows coming in. And I started to really, really enjoy it. And I thought, Okay, well, I don't want to stop now. This is going well, it's becoming lucrative. Like why don't we why don't we start to partner with people and continue to build this portfolio that we started? Even though I still had a full time job? I guess what, you know, police and fire department we get a lot of time off. Sure. So I was using I really never had a day off because even if I was on a day off with police I would be taken care of stuff looking for new deals, this and that. And ultimately, that led us to continuing the portfolio and joint venturing and partnering with like minded investors. Sure. Again, still working full time and everything like that. So I'll fast forward this forward 10 years later, and the light bulb went off and like we're growing or growing or buying properties together with JV partners. It was like, Okay, I was creating, I created a lot of cash flow coming in, which enabled me to leave the police department early. Okay. So rather than sticking around and putting in my 30 years, and then having a full pension, I stayed till 21 years of service. Okay, so 21 years of service. And obviously, now having more properties and cashflow and partnering with different people financially, I was able to leave early after 21 as opposed to my 30. And from there really scaled the company, we obviously became, became a full time investor created a business out of it joint venture partner business, and really homed in on the birth strategy for my clients and my partners.
Casey Brown 6:23
Now go ahead and just just for the listener that may or may not know the birth strategy, go ahead and maybe tell us what that is and define it a little bit.
Unknown Speaker 6:34
Yeah, for sure. So buy renovate, refinance rent. So basically, what we did was we honed these our expertise on that strategy. So what do we do we look for distressed properties, properties that are structurally typically structurally sound, but cosmetically are disaster. You know, they're 7080 years old, and not things have been done on the inside for 70 years. So like original kitchens original, this original that on and on and on. So we look for those properties at a discounted price. And then we obviously renovate them, bring them up to snuff and modernize them, refinance them, call the bank back. Okay, renovations are done, come reappraise the home now. And then our goal is to force the appreciation in that house, so much through really, really good, deep renovations, that ultimately, we can extract all of the renovations, all of our downpayment, all of our carrying costs, closing costs, we get it all back. Yep. And then I like to say, right, exactly,
Casey Brown 7:51
exactly. And the rent, the rent takes care of the the, basically the equity building rather. So Wow. I mean, and were so obviously, again, you being the post, the post, oh 708 era of this learning curve. Where are you? Again at 12 1314, though that that time, you probably still had a decent amount of foreclosures, I would say around to Dubai, or or
Unknown Speaker 8:26
Arizona? Yeah, there was great opportunities for sure. So where
Casey Brown 8:30
are you recently, like your most recent deals where you find a nose? And how are you? How are you kind of now geographically speaking, are you pretty much are you basically anywhere that the weather's a deal? Or do you stay in certain markets? That needs to be the first question, because then that won't give us gives us some context to say, then, where are you finding the deals within those areas?
Unknown Speaker 8:54
Yeah, for sure. So we're looking for deals pretty much in the GTA and from Toronto, Canada. Pretty much in the GTA, we were finding being in the space now for 11 years, we built up quite a reputation. So we get a lot of off market leads, you know, Hey, I heard you guys do this and do that, you know, you're interested in coming and look at my, you know, distressed or whatever, we're getting a lot of tips off market. And then we also buy stuff on the market. You know, we've we can look at a property and again, I should mention a lot of our stuff or pretty much all of our stuff is all multifamily. Okay. Typically not buying single family homes or condos
Casey Brown 9:38
or single family. No, it's always been multifamily. Okay.
Unknown Speaker 9:43
Always attracted a cash flow right. And obviously, you know, three units is going to produce cashflow more than a single family or condo and whatnot. Yep, yep. You're focusing on that across the GTA in the multifamily space both on and off. off market. And being in the game for 11 years, we've really honed our expertise on the numbers like we're, we're really wanting numbers and, you know, underwriting deals at a very high level where we can come to our partners, our joint venture partners and say, Hey, here's the deal. Here's the Excel spreadsheet, let's go through these numbers together, you know, here's our purchase, here's our rentals. Here's our new rental income, here's our after repair value. And we're running those numbers at a high level, and we're very consistent delivering, like I say, it's, it's pretty much infinite return on your investment.
Casey Brown 10:38
And you can almost show them right up front, hey, this is the return this is gonna be the return once this whole process has taken place. Now, do you? Are you for your JV partners and stuff that come in with you? Are you which joint venture partners is is? What what just for the listener that may be wondering what JV is GTA I'm assuming is Greater Toronto Area? Yes. Yes. Sorry. So. So the JV partners that you bring in? And you're are they looking for an exit strategy? Or were they just basically owners forever with you? Or how does that look when you first set that up?
Unknown Speaker 11:20
Yeah, good question. So we are more of a long term wealth, generational wealth kind of play company. So we asked for a minimum of five years, okay, investment. And then we can buy each other out on the back end. Or like I said to them, a lot of times a lot of the JV partners that said, hey, you know, the capital is being returned, we're getting our money out on the back end on the exit on the refinance. So we still cashflow, we still have debt paid down from the tenants. Cash flow that pay down passive appreciation, and there's really little to no money left in the deal on the exit. We don't need to sell it. And obviously, when we refinance properties, and we pull that equity out, it's tax free here in Canada.
Casey Brown 12:12
What's the second year if you refinance, if you refinance and hold the asset, the equity that you pull out? You don't you're not being taxed on until that asset, you know, till that asset transfers and sold entities are sold, or whatever it is.
Unknown Speaker 12:29
Exactly. He's here. Yep. So you got no money left in the deal. You got a new product, your cash flowing debt paid down from the tenants, tax free, we don't need to sell sure ares itself plus some need to sell it. And like I said, you know, obviously if somebody came by and offered us, you know, $10 million, okay, fine. Never say never. But you know, on a regular basis, we typically like to hold the assets for a very long time. And accumulate that long term wealth by investing in real estate.
Casey Brown 13:03
Yep. And so you just leave the JV partner in there as as a partner, and you just carry it on and until you and then now does your are you operating through? Are your investors. So the I'm trying to think about how to because in Canada, this the landscape looks just a little different. I think when you're raising private capital, right, do you all have like, what's the what's the entity structure look like?
Unknown Speaker 13:36
So they're bringing capital Okay, where the sweat equity partner, okay, the expert partner in facilitating the Burb, we're utilizing our sister company, so we own our own construction company. Okay, we own our own property management company that works in unison together to facilitate these results. So they're bringing capital, we're utilizing all of our expertise in our companies to deliver the the, the amazing Burr and then at the end of the rainbow, we're 5050 partners on the property.
Casey Brown 14:08
Gotcha. Okay. And that's, that's after everything's refinanced, and, and Apple
Unknown Speaker 14:13
talk to the partner. Now we're cash flowing, we got a new product property management's in place, essentially, like our investors, we like to pride ourselves, aren't we do it all our investors, essentially, don't lift the finger, don't do nothing. Never speak to a tenant. You know, never.
Casey Brown 14:32
Yeah, that's the goal. I mean, that's what everybody wants to do. And that's, that's again, yeah, that's how that's the majority of our draw for new investors is exactly what you just said. I mean, they don't they basically don't lift a finger they go on about their way and again, that's that's the whole basically the definition of passive income. I mean, for the for all, you know, everything included there. I mean, it's just you just forget about it. Here it is. I Just get mailbox money. So you're so at this point right now, how many doors do you all manage? Or own or partnerships with? How does how does that look right this minute as we speak?
Unknown Speaker 15:17
We you just kind of got fuzzy there for a second. Can you say that again?
Casey Brown 15:25
Oh, how many doors do you all have right now? Like under management? Or? Or what is your what is the current state of the business look like?
Unknown Speaker 15:35
Yeah, so we just purchased another couple properties in partnership. So we're at 70 properties and 372 units.
Casey Brown 15:49
That's great. So So somewhere around four for like quad Plex, like four units per property or something like that.
Unknown Speaker 15:56
A lot of them are, triplex is for plexes. You know, ranging anywhere also in the apartment building space from six units, 12 units, 45 units. So we're also in the apartment building space as well. And as similar as a duplex.
Casey Brown 16:14
Man, that's awesome. That's, that's, that's a killer strategy. I mean, it's just kind of it kind of just and that's the whole thing. And what I love about your story is is that the fact that you were just regular ground pounder worker, Patrolman, what are police officer and again, I'm not I'm not, I don't mean for that to sound like I'm, I'm but I'm just saying you were just working a regular job. And now you're owner, manager, property manager, builder, construction, man, I mean, all of that post, working a W two type job. And, and that's, that's such a, such a take on that is that like, it's possible for anybody. I mean, if you can sit there, all you have to have is a little bit of vision, and take a little bit of action to start. And, again, you all capitalized on the initial rise in the market value of your, your principal residence. So capitalizing off of that and saying, and realizing that, hey, maybe this is something we can build, post, everyday work life. And I mean, that's, that's like, I mean, that's the I guess we'll call that the Canadian dream instead of the American dream now, right? I mean, it's the it's just what dreams are made of, and so many people get up every day, and they're like, I don't, how do I find my way out of having to go work for the man. And I mean, there it is, there's there is he just gave you a blueprint for the listeners out there that are that are wondering where, and what you can do to set your sights out further than your W two job. There it is. Now, I don't know that you all call it a W two job in Canada, but But what I'm getting at is, is that every day worker becoming something great, like what he's done here. So now, with all of that being said, how many? How many investor partners do you have? Do you do you continually go back to the same pool of investors? Are you bringing new investors in? Or how does that look,
Unknown Speaker 18:24
we do get a lot of repeat investors, because again, you know, when you deliver these high results, you know, a lot of it's rinse and repeat kind of program,
Casey Brown 18:36
and they're just their money back. So just turn it and put it right back in.
Unknown Speaker 18:39
And, you know, we if they have aspiration, a portfolio of 235 properties, or whatever the case may be the burst strategy allows you to do that, again in partnership with us. Renson name repeating your capital. So we have refer, obviously, a lot of our businesses referrals and repeat, really, because it's like, wow, Adrian that work. That's amazing. Okay, let's do it again. All right, find me another property. Okay, let's go and
Casey Brown 19:13
just rinse and repeat. Rinse and repeat, rinse and repeat. And so yeah, now you had made mention earlier of the majority of elementary either even know if you gave a percentage, but the majority of your your deals are off market. Now how how do you manage that? Like what were when you say off market? I mean, do you all are you all just getting referrals from people like that know that you're gonna come in and that, hey, I know this guy that That'll buy this place or something like that?
Unknown Speaker 19:46
For the most part, yeah. So we built up a reputation obviously. And then a lot of the people that contact us know we close deals. Yeah, right. And we don't retire as we don't. Our people are qualified. We're not Wastin time and this and that we close deals. So we get a lot of a lot of people coming into table asking us, hey, you know, I got this, you got somebody, you know, are you interested in this property? So we get a lot of tips off market in that regard.
Casey Brown 20:16
Man, that's great. And then that way you because in a lot of times, and that's even true in the United States, I mean people are we closed deals. I mean, you heard him right there we closed deals. And that's what a lot of times people are looking for, is they don't maybe necessarily not want to go on market to because of one reason or another. But then they're like, hey, if I just don't even have to fool with it, like if this guy will come in here and look at this property and just say, hey, yeah, I'll take it, then. Kind of that's the end of the line. I mean, you take it, write a check, or whatever, whatever the case is, and close it. Now. Do you involved bank financing in the beginning? Or for the most part? I mean, or do you all? Do you all tend to handle that a different way? How does that look?
Unknown Speaker 21:05
Well, obviously, as long as the property is habitable, yeah, not that far gone. As long as it's habitable. We do traditional bank financing for the purchase. If it's so far gone, like we've, we've we've purchased properties that were charred inside because of a fire or major major water damage, and it's not habitable, then obviously, we're looking at hard money lenders sure to fund the purchase. And then ultimately, once the project is done, we'll refinance for traditional lender.
Casey Brown 21:39
Sure. And the hard money lending landscape, I assume is much the same there as it is in the States. You just you call them up? And then they they basically just loan on the deal, right?
Unknown Speaker 21:50
Yeah, every deal is obviously different. And they all ask us a bunch of questions and want to know exactly about the deal, and so on and so forth. Sure, sure.
Casey Brown 21:59
Now, I've been just recent as as of recent been asking my guests a few just kind of kind of just off the cuff questions as far as like, just to get some insight into what you do in your daily life. And what's some things about you that people may want to know? And I guess the first one of those questions is, what is what's your favorite book that you've ever read? Whether it be about real estate investing, or whether it be about life or whether it be about whatever it is, what's the best book you've read?
Unknown Speaker 22:36
I like the one from Grant Cardone.
Casey Brown 22:42
He's written several which one rather money
Unknown Speaker 22:44
sitting on the front of the sitting on a plane at the front of a plane and it's faster be average? Yep. Is that it? Yeah, something like that. That's probably one of my favorites. And I really, I really resonated with that book. Because, you know, it's been a great journey. It all hasn't been roses. And it's been a ton of hard work. And I really adopted that mindset of being obsessed. And be assessed
Casey Brown 23:15
or be average. That's right.
Unknown Speaker 23:17
That's it be obsessed or be average, and really adopted that theory in mindset with my real estate investing business and career. Obviously, we've turned it into a business. And I think with that mindset, it really like again, rewind 11 years ago, did I ever think I never thought in my wildest dreams, right? We'd be at over 370 doors. Yeah, I thought I would just want to properties. And he started out just just just, I think my mindset, and that book really transitioned my mindset as well.
Casey Brown 23:54
Yeah. Yeah. And grant has a has a very keen ability to, to transcend people's mindsets to towards a direction of greatness, really. And honestly, I talked to the guy before and and I just don't quite understand that his age where he gets the energy that he has. Now, as he's mid 60s, I believe. Oh, wow. And I may be angry, and he may he may hear that and get through the grapevine that I said that but I'm most quite certain that that he's, he's, he's north of 60 Is that what a lot of people think and, and, you know, he's, he's not much further than that. He's not much different agent than my father and my dad, just, if he's if he's anything, he's tired. Just seems like yeah, I'm like, how does how does that guy just he just keeps pumping it out. And he just keeps going and he just keeps getting more assets. under management, he just keeps rolling and rolling, rolling. But anyway, so tell us now you had mentioned earlier that you know, you were you were at one point in your life the in raising the raising the family segment and what? So a lot of times people look back and they say, oh, you know, when I asked this question, but what's what's the best trip that you've ever taken? Like, where? Where was your favorite destination? And? And how did that relate to where you were where you were headed in life?
Unknown Speaker 25:31
Europe, Italy, so we're
Casey Brown 25:34
talking about that?
Unknown Speaker 25:35
Yeah, it was. Very, so I'm 48 years old. Now. The very first time I was in Italy was probably 12 years ago, I was probably in my late 30s. And I really, my family, my mum and dad, were obviously born in a very small town in Italy, a couple hours south of Rome. And for years and years and years, I just really had zero interest to see Europe, and you know, where my mom and dad actually started. And finally, 3738 however old I was, then it's probably around 37, I finally took the trip. And I went back, or I went to the motherland, and saw where my parents were born and met, I still got family, their uncles and cousins. It really, really, it was incredible. And ever since then, I've been back every year, what resonated with me is just the culture there. The culture and the way they, here we in Canada, and obviously the states as well, but we work all the time. And it's always about a lot of times, it's always just work, work, work, work, work. Yep. Like, here, we live to work there, they work to live, and they live and they enjoy themselves, they don't have a lot. And it really opened up my eyes to that, like, they don't have a lot at all very small little town in Italy. I mean, they have to get by,
Casey Brown 27:17
they're happy to have what they do have.
Unknown Speaker 27:19
And they enjoy it. And they enjoy life. You know, they do their siesta in the afternoon, and all this jazz, they grow, you know, everything in their garden, and, you know, just just a lifestyle, and they really enjoy life. And money is not overly important. As long as they have enough to put food on the table, you know this or not. So that really resonated with me. And it was like, wow, there's more to life, there's more than just, you got to enjoy yourself too, right?
Casey Brown 27:53
Just the hustle. And the Go, go, go, go go. I'll, I'll interject something just to further your point there. You my wife and I were were just in Italy. And then before that we were in France, but much like the area of France we were in was was right at the Italian border. And so we drove up to a little mountain town. And we were we were setting we got there we woke up at like 3am right because the we were just so screwed up on our sleep or whatever. So we were at this draft and we had rented a car and so so so we just drove up into the mountains right there right on the Italian Italian line or Italian border close to Monaco and we got to this little little town that was just basically everything was made a stone and as we sit there we went to this old coffee shop and the coffee shop guys you know there was you could tell there was the regular crowd in there who were residents of this little town and basically the coffee shop started at whatever time that morning and went till I would say I'm gonna just say 10 o'clock and you drink coffee and ate croissants from whatever time it started before we got there till 10 o'clock and then at 10 o'clock or 1030 or 11 or whatever time it was it was somewhere along in that area. The the coffee shop then starts to make this transformation into a bar slash lunch area and everybody has begins the same guys that were sipping coffee that morning now they begin to have cocktails and then that goes until about one then they closed the whole place up yeah well this block it all up from like one to three and that's their siesta X their nap time, then, and then three o'clock on it's it's bar and dinner. And I was just like I was so astonished at. I was like How do these people get anything done? And then I thought, Oh, I have to get anything done because this is what they do. And this is much the same and it was such a sobering thought to think that exactly what you're saying about about Southern Italy. I mean, it's all the it's that whole, that whole area through there just makes us. It really gives you a lot of perspective on life. So anyway, I didn't mean to take your story, but I love that. Yeah, no, no, it's all good. It's all that and understands what's going on there. So
Unknown Speaker 30:22
yeah, well, well, Adrian,
Casey Brown 30:25
listen, we're about out of time, I want you to tell the listeners how they can reach out to you. If they have questions about maybe something they heard today, or if they have questions, I assume that I'm not quite sure the landscape of you taking on new investors or potentially even talking to new investors or whatever the case is, but how can people reach out to you if they feel necessarily feel that it's necessary?
Unknown Speaker 30:47
Yeah, for sure. So the simplest, easiest way is shoot me an email, Adrian ADR, I am at invest with eapc.com. We're all over social media, Facebook, Instagram, LinkedIn, you know, put in my name, Adrian Kanojo, or just executive properties, capital. We're all we're very, very searchable. So yeah, I mean, if there's anything I can do to help, if there's one thing you got today, you know, and I never repeat it again, if I can do it, and I gave zero background in business, you know, I was a cop for 21 years, I didn't take any business education or real estate education or any of that. So if I can do it, you can do it.
Casey Brown 31:35
Awesome, man. That's great. That's, I don't know that I don't know that there's better advice that we all hear. It seems like we hear that all the time. And you know, the thing the difference is, is whether you put whether somebody hears that and puts it into action, and says, Hey, Bing, whatever it is today and going forward. So, Adrian, thank you so much for your time. Again. We're always grateful for people to come and spend time with us and with our listeners, and we hope everybody has a wonderful rest of the day. Thank you. Cheers.
Transcribed by https://otter.ai