Capital. His career started when his dad fired him from his first real job. He messed some things up and realized he did not want to be anyone’s employee. He dropped out of college and got his real estate license. He then spent 18 years on that side...
Capital. His career started when his dad fired him from his first real job. He messed some things up and realized he did not want to be anyone’s employee. He dropped out of college and got his real estate license. He then spent 18 years on that side of the business until he realized he had not built his wealth. He went from a traditional residential brokerage business to adding a syndication side focused on creating passive income and building wealth.
Canovo focuses on commercial multifamily properties where strategic capital improvements and operational efficiencies create significant value. Their strategic partnerships allow investors to invest alongside experienced operating partners with a proven track record of delivering attractive risk-adjusted returns. They target large investment opportunities in various strategic markets, demonstrating strong population growth, consistent rent growth, and low vacancy.
In this episode, we discuss:
Tune in on this episode to learn how to take advantage of your aha moment!
Find your flow,
Casey Brown
Resources mentioned in this podcast:
1
00:00:00,537 --> 00:00:06,667
[casey_]: hey there and welcome to today's episode
of cash flow pro your daily real estate
2
00:00:06,727 --> 00:00:14,300
[casey_]: investing podcast and youtube channel i'm here
today with david robinson and i got to
3
00:00:14,360 --> 00:00:20,811
[casey_]: admit david whenever i saw your name
come across i was really really praying for
4
00:00:20,871 --> 00:00:22,353
[casey_]: somebody that was like eight foot tall
5
00:00:22,200 --> 00:00:22,461
[david]: oh
6
00:00:23,175 --> 00:00:26,959
[casey_]: and was epic epic basketball
7
00:00:26,370 --> 00:00:27,180
[david]: yeah
8
00:00:27,039 --> 00:00:30,363
[casey_]: player but instead we got stuck with
you so
9
00:00:30,931 --> 00:00:31,113
[david]: yeah
10
00:00:31,404 --> 00:00:32,365
[casey_]: i'm just getting man now
11
00:00:32,580 --> 00:00:32,640
[david]: i
12
00:00:32,625 --> 00:00:33,066
[casey_]: we're glad
13
00:00:32,980 --> 00:00:38,248
[david]: am i am the short white version
of david robinson
14
00:00:40,111 --> 00:00:41,193
[casey_]: man it's cool dude
15
00:00:41,730 --> 00:00:41,750
[david]: m
16
00:00:42,175 --> 00:00:45,981
[casey_]: you know i was like if if
i just was
17
00:00:45,912 --> 00:00:46,077
[david]: yeah
18
00:00:46,021 --> 00:00:48,726
[casey_]: thinking i was like man if i
if i had david robinson here man i
19
00:00:48,786 --> 00:00:49,487
[casey_]: mean you know there how many
20
00:00:49,470 --> 00:00:49,953
[david]: uh
21
00:00:49,527 --> 00:00:51,971
[casey_]: questions you got to ask about those
years that he was
22
00:00:52,069 --> 00:00:52,460
[david]: uh m
23
00:00:52,512 --> 00:00:54,675
[casey_]: but anyway so man how are you
doing today
24
00:00:55,100 --> 00:00:56,985
[david]: i'm doing great and i'm doing great
excited to be here
25
00:00:56,929 --> 00:00:57,031
[casey_]: oh
26
00:00:57,085 --> 00:00:58,328
[david]: and looking for a dark conversation
27
00:00:59,057 --> 00:01:07,110
[casey_]: awesome well david is with kanobo capital
and he is more than he wants to
28
00:01:07,170 --> 00:01:11,778
[casey_]: talk about raising capital about indications about
basically everything that we cove on this show
29
00:01:12,479 --> 00:01:15,284
[casey_]: and i can't wait to kind of
dig in here and figure out you know
30
00:01:15,384 --> 00:01:19,030
[casey_]: what things you do what things you
do maybe differently than some of the rest
31
00:01:19,090 --> 00:01:23,578
[casey_]: of us or or some of rest
of the listeners so david an't you kind
32
00:01:23,658 --> 00:01:25,882
[casey_]: o leave your basketball
33
00:01:26,940 --> 00:01:27,222
[david]: oh
34
00:01:27,043 --> 00:01:29,127
[casey_]: career out your back story
35
00:01:29,019 --> 00:01:29,040
[david]: h
36
00:01:29,247 --> 00:01:32,873
[casey_]: and let's chat about where you came
from how you got where you are and
37
00:01:33,314 --> 00:01:34,156
[casey_]: we'll kind of go from there
38
00:01:35,901 --> 00:01:40,048
[david]: well real estate is almost all i've
ever known um
39
00:01:39,930 --> 00:01:40,417
[casey_]: hm
40
00:01:40,930 --> 00:01:48,823
[david]: my career started when i was fired
by my dad at my first real job
41
00:01:48,923 --> 00:01:54,893
[david]: which was working for his small independent
mechanical engineering firm i
42
00:01:54,908 --> 00:01:55,092
[casey_]: wow
43
00:01:54,933 --> 00:01:59,461
[david]: was going i was going to college
i just returned home from a two church
44
00:01:59,541 --> 00:02:04,910
[david]: service mission and i was working working
for him going to college and i screwed
45
00:02:04,990 --> 00:02:09,818
[david]: some stuff up for the for the
last time and he finally got fed up
46
00:02:09,978 --> 00:02:16,188
[david]: with my is handling of the item
that i was dealing with and we both
47
00:02:16,729 --> 00:02:20,836
[david]: decided that it was time to part
ways and that was so that was really
48
00:02:20,876 --> 00:02:25,264
[david]: my first for and realizing i i
don't know that i'm cut out for this
49
00:02:25,484 --> 00:02:32,756
[david]: employee type um you know environment and
from there i decided to pursue real estate
50
00:02:32,996 --> 00:02:38,445
[david]: full time i actually dropped college went
full time as a real estate agent i
51
00:02:38,506 --> 00:02:43,274
[david]: got my real estate license and immediately
began you know learning the real estate business
52
00:02:43,674 --> 00:02:47,260
[david]: from a broker agent perspective i
53
00:02:47,257 --> 00:02:47,419
[casey_]: sure
54
00:02:47,380 --> 00:02:50,706
[david]: spent i've spent the last roughly eighteen
years
55
00:02:50,659 --> 00:02:50,760
[casey_]: ah
56
00:02:50,786 --> 00:02:52,729
[david]: in the real estate business the
57
00:02:53,187 --> 00:02:53,413
[casey_]: yeah
58
00:02:53,190 --> 00:02:59,842
[david]: vast majority of the first part of
my career was in managing residential sales teams
59
00:03:00,263 --> 00:03:05,537
[david]: and a national franchise brokerage and a
handful of years back about five years ago
60
00:03:07,221 --> 00:03:13,030
[david]: i looked up and realized that i
had been doing well in the real estate
61
00:03:13,371 --> 00:03:20,783
[david]: business making a good income but i
hadn't done nearly enough um in regards to
62
00:03:20,883 --> 00:03:24,269
[david]: building my own personal wealth and cash
flow and
63
00:03:24,607 --> 00:03:25,297
[casey_]: yeah
64
00:03:24,750 --> 00:03:29,778
[david]: it was sort of an a a
moment i got a call from my my
65
00:03:29,898 --> 00:03:35,745
[david]: mom one day about five years ago
and dad had just gotten out of a
66
00:03:35,805 --> 00:03:41,192
[david]: heart surgery the heart surgery went very
well he had been home for the last
67
00:03:41,272 --> 00:03:48,384
[david]: couple of days and had been feeling
horrible and ultimately had done sceptic
68
00:03:48,877 --> 00:03:49,280
[casey_]: oh
69
00:03:48,965 --> 00:03:51,529
[david]: he got an infection during the surgery
had
70
00:03:51,568 --> 00:03:51,790
[casey_]: oh
71
00:03:51,569 --> 00:03:52,339
[david]: gone septic
72
00:03:52,073 --> 00:03:52,497
[casey_]: man
73
00:03:53,000 --> 00:03:58,669
[david]: basically died they revived him on the
ambulance in the ambulance ride to the hospital
74
00:03:59,167 --> 00:03:59,187
[casey_]: m
75
00:03:59,170 --> 00:04:03,717
[david]: they revived him he ended up making
it but that was my a moment when
76
00:04:03,777 --> 00:04:08,666
[david]: i realized okay things got to give
i really have to hunker down and focus
77
00:04:08,766 --> 00:04:12,913
[david]: on building wealth for me and my
family and so i shifted my entire business
78
00:04:13,333 --> 00:04:19,804
[david]: from residential traditional residential brokerage business too
the investor side of the business and so
79
00:04:19,844 --> 00:04:25,554
[david]: i started serving investor clients and i
still have that brokerage today so there's two
80
00:04:25,634 --> 00:04:26,455
[david]: parts to my business
81
00:04:26,857 --> 00:04:27,181
[casey_]: yes
82
00:04:26,996 --> 00:04:32,986
[david]: there's the brokerage business which is serving
buying hold investors who are looking to acquire
83
00:04:33,407 --> 00:04:39,617
[david]: small scale multi family property for their
own personal portfolios here in utah the greater
84
00:04:39,677 --> 00:04:45,245
[david]: utah valley um anything when i say
small scale and referring to anything under roughly
85
00:04:45,345 --> 00:04:47,629
[david]: five million dollars all the way down
to your typical fourplex
86
00:04:48,467 --> 00:04:48,809
[casey_]: got you
87
00:04:49,180 --> 00:04:49,240
[david]: so
88
00:04:49,231 --> 00:04:49,412
[casey_]: got
89
00:04:49,320 --> 00:04:55,085
[david]: we helped those clients and then i
also have the uhsindication side of the business
90
00:04:56,106 --> 00:04:59,689
[david]: that i'm happy to dive into and
talk about why i transitioned and all that
91
00:04:59,749 --> 00:05:00,984
[david]: if you like oh
92
00:05:00,737 --> 00:05:11,329
[casey_]: sure sure man your story sounds like
dude it's almost identical to mind in where
93
00:05:11,689 --> 00:05:17,379
[casey_]: although i am a few years into
that that shift problem not quite as far
94
00:05:17,519 --> 00:05:21,606
[casey_]: in as you have been for as
many years into the shift of saying hey
95
00:05:23,048 --> 00:05:27,596
[casey_]: you know i looked at it when
mile moment hit i was like man i
96
00:05:27,716 --> 00:05:33,381
[casey_]: sold seventy three properties last year right
on the sales side residential single family residential
97
00:05:33,461 --> 00:05:39,807
[casey_]: up to you know a few smaller
commercial deals and i was like this is
98
00:05:40,128 --> 00:05:45,597
[casey_]: this is great and it's okay it's
not fun because everything
99
00:05:45,279 --> 00:05:45,300
[david]: m
100
00:05:45,697 --> 00:05:51,186
[casey_]: is like pulling teeth and then i
was like all right i made decent money
101
00:05:51,528 --> 00:05:56,951
[casey_]: but how are these people making generate
like generational wealth really
102
00:05:57,164 --> 00:05:57,429
[david]: right
103
00:05:57,972 --> 00:06:01,755
[casey_]: and and when i sat down i
was like what's the difference in what i'm
104
00:06:01,836 --> 00:06:09,027
[casey_]: doing and when i realized that it
was such a transactional business and the transactional
105
00:06:09,107 --> 00:06:14,676
[casey_]: part of it was really it was
it was for all intents and purposes suffocating
106
00:06:14,716 --> 00:06:18,763
[casey_]: me because it's because you work so
hard to get that transaction across the line
107
00:06:18,783 --> 00:06:21,387
[casey_]: you get that ten thousand dollar commission
check you know what you turn around you
108
00:06:21,408 --> 00:06:23,691
[casey_]: spend that ten thousand or comisioncheck then
you got to go for the next one
109
00:06:24,192 --> 00:06:26,055
[casey_]: then you got to go for the
next one and if that next one doesn't
110
00:06:26,115 --> 00:06:31,013
[casey_]: come you can get your ass in
a pinch real quick and so it's almost
111
00:06:31,093 --> 00:06:34,539
[casey_]: identical man al the way down to
my dad had to have heard surgery although
112
00:06:34,365 --> 00:06:34,385
[david]: m
113
00:06:34,619 --> 00:06:38,706
[casey_]: his was earlier on and it was
matter fact it was ten years ago yesterday
114
00:06:39,006 --> 00:06:39,066
[casey_]: no
115
00:06:39,191 --> 00:06:39,517
[david]: oh wow
116
00:06:39,849 --> 00:06:45,351
[casey_]: eleven years ago yesterday and so it's
just you know those kind of things wake
117
00:06:45,371 --> 00:06:49,357
[casey_]: you up in life and and when
when i'm sitting there and like you said
118
00:06:49,738 --> 00:06:50,199
[casey_]: you just you
119
00:06:50,163 --> 00:06:50,224
[david]: ah
120
00:06:50,299 --> 00:06:52,623
[casey_]: begin to reflect on saying
121
00:06:52,575 --> 00:06:52,616
[david]: a
122
00:06:53,424 --> 00:06:57,972
[casey_]: man you know what am i doing
here to protect my future my kids future
123
00:06:58,052 --> 00:07:01,037
[casey_]: you know not that once they had
eighteen or twenty years old not that i
124
00:07:01,197 --> 00:07:06,847
[casey_]: necesarily have to so much worry about
them but nevertheless you know you've got to
125
00:07:07,069 --> 00:07:12,531
[casey_]: it so i love that part of
that you really high lighted the fact that
126
00:07:13,231 --> 00:07:16,855
[casey_]: the sales part of it and how
you transitioned that into
127
00:07:16,859 --> 00:07:16,980
[david]: yeah
128
00:07:18,518 --> 00:07:21,065
[casey_]: one side kind of serves the other
now really right
129
00:07:22,260 --> 00:07:22,741
[david]: absolutely
130
00:07:22,357 --> 00:07:23,017
[casey_]: yeah
131
00:07:22,801 --> 00:07:27,309
[david]: i mean that was really i knew
i didn't know exactly how i was going
132
00:07:27,429 --> 00:07:33,559
[david]: to go about building wealth and passive
income i explored a handful of different
133
00:07:33,798 --> 00:07:33,980
[casey_]: sure
134
00:07:34,661 --> 00:07:37,746
[david]: when i decided that it was time
you know after that a moment when my
135
00:07:37,846 --> 00:07:44,978
[david]: dad recognizing that i hadn't accomplished what
i needed to m from a cash flowing
136
00:07:45,098 --> 00:07:49,125
[david]: wealth building pers spective i made that
transition i just didn't know exactly how that
137
00:07:49,165 --> 00:07:52,150
[david]: was going to happen i had a
mentor of mine a friend of mine that
138
00:07:52,170 --> 00:07:54,634
[david]: i went to lunch with i talked
to him about this sort of what was
139
00:07:54,654 --> 00:07:57,639
[david]: going on in my head and he
really encouraged me to get in the multi
140
00:07:57,760 --> 00:08:06,915
[david]: family and so the closest proximity uh
you know shift was okay i'm already a
141
00:08:06,975 --> 00:08:12,444
[david]: broker i'm already in the broker you
know the real estate brokerage space let's just
142
00:08:12,805 --> 00:08:15,189
[david]: make a slight pivot into
143
00:08:14,817 --> 00:08:14,940
[casey_]: yep
144
00:08:15,930 --> 00:08:20,958
[david]: the multi family space the investment property
space and start serving clients in that space
145
00:08:21,319 --> 00:08:25,786
[david]: and really focus in that are and
so i dove headlong into it left the
146
00:08:25,846 --> 00:08:27,469
[david]: residential brokerage that i was at
147
00:08:27,997 --> 00:08:28,017
[casey_]: m
148
00:08:28,250 --> 00:08:32,317
[david]: started my own brokerage and started down
this path of multi family and started with
149
00:08:32,827 --> 00:08:33,739
[casey_]: uh
150
00:08:32,918 --> 00:08:34,300
[david]: working with client that we're looking
151
00:08:34,286 --> 00:08:34,327
[casey_]: uh
152
00:08:34,361 --> 00:08:37,045
[david]: to buy small scale multi family and
153
00:08:36,967 --> 00:08:37,173
[casey_]: oh
154
00:08:37,967 --> 00:08:42,214
[david]: have been very successful with that we've
served a lot of clients love working with
155
00:08:42,274 --> 00:08:46,683
[david]: our clients that are looking to buy
that product type but what realize is that
156
00:08:46,904 --> 00:08:54,863
[david]: i was having dozens of investor calls
on a monthly basis
157
00:08:55,547 --> 00:08:55,689
[casey_]: yeah
158
00:08:56,107 --> 00:09:03,185
[david]: and many of those investor calls ended
up going into the conversation with that investor
159
00:09:03,325 --> 00:09:07,412
[david]: wanting to buy small multi family property
for their own personal portfolio
160
00:09:07,998 --> 00:09:08,322
[casey_]: but
161
00:09:08,013 --> 00:09:11,178
[david]: and coming out the other end realizing
oh my
162
00:09:11,107 --> 00:09:11,836
[casey_]: yea
163
00:09:11,278 --> 00:09:15,957
[david]: gosh actually don't want to own that
fourplex or that sigplex
164
00:09:16,670 --> 00:09:16,810
[casey_]: why
165
00:09:16,720 --> 00:09:16,981
[david]: or that
166
00:09:16,870 --> 00:09:17,070
[casey_]: did i
167
00:09:17,082 --> 00:09:17,102
[david]: a
168
00:09:17,130 --> 00:09:17,291
[casey_]: know
169
00:09:17,222 --> 00:09:18,688
[david]: place
170
00:09:17,431 --> 00:09:20,654
[casey_]: that was the next step why did
i know that i don't even know how
171
00:09:20,754 --> 00:09:22,456
[casey_]: i knew that my god
172
00:09:22,892 --> 00:09:26,057
[david]: and so that was sort of the
a a moment for me was number
173
00:09:26,007 --> 00:09:26,313
[casey_]: yes
174
00:09:26,238 --> 00:09:33,670
[david]: one i had built i put a
lot of effort into building a large multi
175
00:09:33,790 --> 00:09:35,734
[david]: family invest our network over
176
00:09:35,757 --> 00:09:35,902
[casey_]: yep
177
00:09:35,954 --> 00:09:41,123
[david]: twenty five hundred quality buy and hold
investors in my network at this point in
178
00:09:41,203 --> 00:09:50,538
[david]: time and very large per centage of
that network has zero interest in owning small
179
00:09:50,618 --> 00:09:52,522
[david]: scale multi family they thought they did
180
00:09:53,179 --> 00:09:53,340
[casey_]: that's
181
00:09:53,303 --> 00:09:53,603
[david]: but when
182
00:09:53,521 --> 00:09:53,683
[casey_]: right
183
00:09:53,663 --> 00:09:57,931
[david]: it really comes down to it they
just want all the benefit of owning real
184
00:09:57,971 --> 00:10:03,346
[david]: estate they don't necessarily want to actually
have to deal with the personal ownership of
185
00:10:03,427 --> 00:10:03,968
[david]: the real estate
186
00:10:04,347 --> 00:10:04,572
[casey_]: i mean
187
00:10:04,642 --> 00:10:05,220
[david]: yeah
188
00:10:06,027 --> 00:10:06,287
[casey_]: you mean
189
00:10:06,240 --> 00:10:06,481
[david]: yeah
190
00:10:06,327 --> 00:10:11,913
[casey_]: they don't like changing light bulbs and
worrying about ax systems on saturday afternoons and
191
00:10:12,721 --> 00:10:12,881
[david]: well
192
00:10:12,794 --> 00:10:13,335
[casey_]: i can't believe
193
00:10:13,121 --> 00:10:13,482
[david]: and and
194
00:10:13,395 --> 00:10:13,455
[casey_]: it
195
00:10:13,903 --> 00:10:16,567
[david]: and that's the common you know that's
the common you know
196
00:10:16,507 --> 00:10:17,137
[casey_]: oh
197
00:10:17,228 --> 00:10:21,335
[david]: line that i often use is he
you know the toilets tenants termites all that
198
00:10:21,636 --> 00:10:25,903
[david]: the reality is there's ways to own
small multi family and build your own personal
199
00:10:25,963 --> 00:10:31,452
[david]: portfolio where it's less management personal management
intensive like you hire third party management companies
200
00:10:31,732 --> 00:10:36,340
[david]: there's ways to do it but here's
the reality they still have to go through
201
00:10:36,360 --> 00:10:40,126
[david]: a process of learning how to invest
in those type of properties you
202
00:10:40,057 --> 00:10:40,199
[casey_]: that's
203
00:10:40,207 --> 00:10:40,427
[david]: still
204
00:10:40,240 --> 00:10:40,465
[casey_]: right
205
00:10:40,487 --> 00:10:44,654
[david]: have to manage the manager you still
have to underwrite the deal and be knowledgeable
206
00:10:44,734 --> 00:10:48,460
[david]: about the deal and you have to
go and get your own financing you know
207
00:10:48,500 --> 00:10:52,928
[david]: there's all these pieces so the reality
is yeah a lot of my investors were
208
00:10:53,268 --> 00:10:59,599
[david]: busy professionals business owners who thought that
they wanted to build their own portfolio but
209
00:10:59,719 --> 00:11:05,228
[david]: didn't and so that caused me to
then start to explore alternative ways to help
210
00:11:05,489 --> 00:11:07,452
[david]: this segment of my investor network
211
00:11:07,876 --> 00:11:07,897
[casey_]: m
212
00:11:07,953 --> 00:11:10,016
[david]: that didn't want to own the real
estate they just
213
00:11:09,967 --> 00:11:10,109
[casey_]: yeah
214
00:11:10,056 --> 00:11:11,639
[david]: wanted to invest in it
215
00:11:12,207 --> 00:11:12,351
[casey_]: yep
216
00:11:12,340 --> 00:11:16,767
[david]: and that's when i start to explore
some different things including like um you know
217
00:11:17,208 --> 00:11:21,836
[david]: uh buying turnkey rentals partnering with a
turnkey rental company in the midwest
218
00:11:22,177 --> 00:11:22,897
[casey_]: yeah
219
00:11:22,237 --> 00:11:25,001
[david]: and helping them get involved with that
i do and that wasn't the path i
220
00:11:25,041 --> 00:11:29,589
[david]: wanted to go ultimately i was exposed
to this indication model and how i could
221
00:11:29,689 --> 00:11:37,429
[david]: partner with quality operators in other parts
of the country prevent that as an operator
222
00:11:37,490 --> 00:11:43,377
[david]: and a sponsor bet their deal and
then partner with them and be a conduit
223
00:11:43,497 --> 00:11:51,751
[david]: for my investor network to participate in
uh you know commercial grade multi fam assets
224
00:11:52,172 --> 00:11:55,478
[david]: that they otherwise wouldn't have a desire
or even know about
225
00:11:56,377 --> 00:11:57,779
[casey_]: try man that's
226
00:11:58,423 --> 00:11:58,546
[david]: no
227
00:11:58,500 --> 00:12:02,808
[casey_]: i mean even the further on you
go it's like everything that you say is
228
00:12:02,848 --> 00:12:07,636
[casey_]: just and i got to imagine if
you and i are both sitting here looking
229
00:12:07,736 --> 00:12:15,995
[casey_]: at this hey these are things that
that that we decided were what we wanted
230
00:12:16,035 --> 00:12:18,521
[casey_]: to do that there's got to be
a slue of other people out there because
231
00:12:18,702 --> 00:12:23,721
[casey_]: i find myself typically there's some people
below some people some people below me some
232
00:12:23,761 --> 00:12:27,908
[casey_]: people above me and i'm pretty well
an average person right and so when you
233
00:12:27,988 --> 00:12:31,855
[casey_]: start looking at it like that man
i mean and you start thinking okay what
234
00:12:31,935 --> 00:12:38,736
[casey_]: can i do to two translate to
these folks that they can own this real
235
00:12:38,776 --> 00:12:44,057
[casey_]: estate and they don't have to worry
about all the teas toilets termites tenants uh
236
00:12:45,419 --> 00:12:46,421
[casey_]: you know that kind of stuff
237
00:12:46,530 --> 00:12:47,370
[david]: oh
238
00:12:46,701 --> 00:12:51,730
[casey_]: and so the way that you can
translate that is really where i
239
00:12:51,780 --> 00:12:52,043
[david]: yes
240
00:12:51,810 --> 00:12:55,196
[casey_]: feel like you could pick up some
people and pick up some interest but what
241
00:12:55,099 --> 00:12:55,530
[david]: hm
242
00:12:55,316 --> 00:12:58,982
[casey_]: did you so so with all that
being said and and me being in full
243
00:12:59,042 --> 00:13:02,908
[casey_]: agreement in full understanding of exactly where
you were and where you went to and
244
00:13:02,949 --> 00:13:08,117
[casey_]: where you are now let's talk a
little bit about i want to i want
245
00:13:08,157 --> 00:13:11,062
[casey_]: to kind of dive just a little
bit in towards the indication part of this
246
00:13:11,242 --> 00:13:15,810
[casey_]: and say okay because there's a lot
of people out there who who are noticing
247
00:13:16,451 --> 00:13:21,219
[casey_]: that maybe they are a decent operator
right but they just don't know how to
248
00:13:21,459 --> 00:13:25,807
[casey_]: take down a ten million dollar apartment
building or you know even a five million
249
00:13:25,847 --> 00:13:29,433
[casey_]: dollar apartment building for that matter and
of course we all know you raise a
250
00:13:29,473 --> 00:13:35,302
[casey_]: million you borrow for all but i
want to hear a little bit more about
251
00:13:35,403 --> 00:13:38,768
[casey_]: like let's say let's just go and
talk about your first deal no matter if
252
00:13:38,828 --> 00:13:42,354
[casey_]: it was a duplex or a hundred
units whatever that first deal was where you
253
00:13:42,575 --> 00:13:48,949
[casey_]: actually rat outside capital had a key
principle or whatever or maybe you took the
254
00:13:49,010 --> 00:13:51,215
[casey_]: note at whatever let's talk about that
255
00:13:52,471 --> 00:13:55,556
[david]: um i'll use two examples the first
256
00:13:55,358 --> 00:13:55,542
[casey_]: okay
257
00:13:55,796 --> 00:13:57,059
[david]: is um
258
00:13:58,057 --> 00:13:58,341
[casey_]: oh
259
00:13:58,080 --> 00:14:01,065
[david]: my first acquisition of a commercial multi
260
00:14:01,057 --> 00:14:01,282
[casey_]: oh
261
00:14:01,165 --> 00:14:01,967
[david]: family property
262
00:14:01,854 --> 00:14:01,957
[casey_]: yeah
263
00:14:02,648 --> 00:14:07,055
[david]: it was not struck this indication it
was a joint venture but i think there's
264
00:14:07,095 --> 00:14:11,743
[david]: a few points to illustrate here number
one is i started where i felt comfortable
265
00:14:12,444 --> 00:14:18,695
[david]: um i couldn't wrap my head around
how to go acquiring you know twenty five
266
00:14:18,735 --> 00:14:22,862
[david]: million dollars to a forty million dollar
apartment building that took time for me to
267
00:14:22,922 --> 00:14:28,130
[david]: sort of understand the concepts and understand
the process and the business model i started
268
00:14:28,150 --> 00:14:32,257
[david]: where i could which was in my
own back yard with a property that i
269
00:14:32,377 --> 00:14:36,885
[david]: felt like was pushing me a little
bit out of my boundary right so i
270
00:14:36,965 --> 00:14:41,812
[david]: ended up buying a fourteen unit apartment
building just south of salt lake city i
271
00:14:41,912 --> 00:14:50,022
[david]: bought it completely off market direct from
owner through direct mail negotiated contract ah brought
272
00:14:49,988 --> 00:14:50,148
[casey_]: that's
273
00:14:50,102 --> 00:14:50,123
[david]: a
274
00:14:50,188 --> 00:14:50,289
[casey_]: like
275
00:14:50,223 --> 00:14:50,706
[david]: partner
276
00:14:50,329 --> 00:14:54,144
[casey_]: what everybody always hears about but nobody
ever that's like the gold nugget right
277
00:14:55,502 --> 00:15:01,892
[david]: it happens it works it just takes
persistent cy persistence and consistency over time
278
00:15:02,548 --> 00:15:02,689
[casey_]: sure
279
00:15:02,774 --> 00:15:06,039
[david]: so i can go into the details
of that but i'll just sort of high
280
00:15:06,240 --> 00:15:11,108
[david]: the points which are got the deal
under contract i had already started building my
281
00:15:11,188 --> 00:15:15,715
[david]: investor network i knew i had two
partners that would be perfect partners for this
282
00:15:15,796 --> 00:15:20,103
[david]: deal it actually ended up not being
deal that i was really super excited about
283
00:15:20,423 --> 00:15:23,789
[david]: but i knew they would be excited
about it was perfect for them they owned
284
00:15:23,829 --> 00:15:28,837
[david]: a property management company here locally that
manages you know a handful of other assets
285
00:15:28,857 --> 00:15:34,727
[david]: that were just exactly this which was
nineteen seventy construction to bed one bath eight
286
00:15:34,767 --> 00:15:39,355
[david]: hundred square foot units so they knew
this product and it was right up their
287
00:15:39,415 --> 00:15:45,205
[david]: alley so i got it under tract
i went through the whole diligence process i
288
00:15:45,405 --> 00:15:49,271
[david]: brought them into the picture they were
excited about it we joint ventured on the
289
00:15:49,352 --> 00:15:55,662
[david]: deal i i actually had zero of
my own money in that deal at the
290
00:15:55,702 --> 00:15:58,707
[david]: end of the day and i held
an equity position with them so we joined
291
00:15:58,767 --> 00:16:02,313
[david]: venture on it they brought the ten
thirty one exchange from another property had all
292
00:16:02,353 --> 00:16:05,699
[david]: the capital for that so that was
my first for i think it's important for
293
00:16:05,779 --> 00:16:10,607
[david]: people that starting to like yes you
want to push yourself but sometimes it doesn't
294
00:16:10,647 --> 00:16:15,856
[david]: necessarily mean i learned so much on
that transaction um that helped me get into
295
00:16:16,557 --> 00:16:19,024
[david]: the larger sindication deal and to understand
296
00:16:18,869 --> 00:16:18,992
[casey_]: sure
297
00:16:19,084 --> 00:16:23,521
[david]: what goes on behind the scenes on
those type of indication deals so that was
298
00:16:23,581 --> 00:16:29,350
[david]: the very first deal then i realized
okay i know that my investor network has
299
00:16:29,410 --> 00:16:36,522
[david]: an appetite for getting involved passively in
larger commercial transactions and so i started to
300
00:16:36,562 --> 00:16:41,511
[david]: build a network with other operators that
were across the country in particular in the
301
00:16:41,551 --> 00:16:44,656
[david]: midwest we were in a hi we
are in a high growth market here in
302
00:16:44,736 --> 00:16:46,279
[david]: utah i mean obviously all across the
303
00:16:46,238 --> 00:16:46,382
[casey_]: yeah
304
00:16:46,319 --> 00:16:46,699
[david]: country i
305
00:16:47,097 --> 00:16:47,221
[casey_]: yeah
306
00:16:47,461 --> 00:16:52,108
[david]: but utah is a low cash flow
high growth state right now especially as i
307
00:16:53,150 --> 00:16:54,192
[david]: as it relates to multi family
308
00:16:54,607 --> 00:16:54,728
[casey_]: yep
309
00:16:54,933 --> 00:16:58,299
[david]: so for me i wanted i knew
that my investors had an appetite for more
310
00:16:58,399 --> 00:17:06,933
[david]: cash flow and so i sought out
locations that generally had a better better chance
311
00:17:07,053 --> 00:17:11,420
[david]: of producing a higher cash on cash
return maybe
312
00:17:11,247 --> 00:17:11,368
[casey_]: yep
313
00:17:11,481 --> 00:17:14,205
[david]: a little bit lower equity but a
little bit more stable so i was generally
314
00:17:14,265 --> 00:17:18,512
[david]: looking in some of the midwest markets
in kansas city was one of those and
315
00:17:18,893 --> 00:17:26,465
[david]: identified on an operator that was there
a lead sponsor a indicator bunch of different
316
00:17:26,485 --> 00:17:32,315
[david]: terminology that's used for individuals that are
running sindications and leading indications they
317
00:17:32,407 --> 00:17:32,551
[casey_]: yes
318
00:17:32,415 --> 00:17:38,024
[david]: were entrenched in the kansas city market
um i had been building a relationship with
319
00:17:38,064 --> 00:17:40,348
[david]: this person for about a year before
we
320
00:17:40,318 --> 00:17:40,562
[casey_]: sorry
321
00:17:40,428 --> 00:17:45,697
[david]: did a deal together and by the
time we had been in contact we had
322
00:17:45,757 --> 00:17:50,746
[david]: done some coaching together i had been
prepping my investor network for these type of
323
00:17:50,786 --> 00:17:54,732
[david]: deals i had been sending emails to
my investors asking them sort of pulling them
324
00:17:55,493 --> 00:18:00,762
[david]: on um whether or not they would
be interested partnering with us on a deal
325
00:18:00,842 --> 00:18:05,250
[david]: in the midwest outside of utah and
i had many of them at responded very
326
00:18:05,330 --> 00:18:10,959
[david]: positively that so i knew there was
an appetite so ultimately i kept notifying my
327
00:18:11,160 --> 00:18:15,467
[david]: and you're out in kansas city saying
hey okay i feel like my investors and
328
00:18:15,727 --> 00:18:20,034
[david]: i are ready for a deal out
there on your next deal let's really talk
329
00:18:20,074 --> 00:18:23,781
[david]: about it let's dive into it he
had a deal come up we looked at
330
00:18:23,841 --> 00:18:28,228
[david]: it together we under wrote the deal
we analyzed it i flew out to kansas
331
00:18:28,288 --> 00:18:29,230
[david]: city i
332
00:18:29,197 --> 00:18:29,505
[casey_]: my
333
00:18:29,610 --> 00:18:33,196
[david]: toward comps i went through the due
diligence process with them
334
00:18:33,907 --> 00:18:34,132
[casey_]: yes
335
00:18:34,058 --> 00:18:37,426
[david]: and ultimately felt like this was an
opportunity that would work well for what we
336
00:18:37,466 --> 00:18:38,248
[david]: were trying to accomplish
337
00:18:38,868 --> 00:18:39,154
[casey_]: awesome
338
00:18:39,630 --> 00:18:43,642
[david]: so i'll stop there there's more to
that story but that's how that was my
339
00:18:43,802 --> 00:18:46,088
[david]: first foray into the indication side of
the business
340
00:18:46,668 --> 00:18:52,024
[casey_]: yeah and it's interesting that you chose
kansas city because man it's like as of
341
00:18:52,164 --> 00:18:58,235
[casey_]: late kansas city has just been on
fire like i'm tying out in the last
342
00:18:58,295 --> 00:19:01,881
[casey_]: like two years year i mean not
just their football team but they've been on
343
00:19:02,182 --> 00:19:02,482
[casey_]: fire
344
00:19:02,370 --> 00:19:02,736
[david]: yes
345
00:19:02,582 --> 00:19:04,706
[casey_]: like everything about kansas city has been
on
346
00:19:04,710 --> 00:19:04,992
[david]: oh
347
00:19:04,786 --> 00:19:07,234
[casey_]: fire um and i'm not a chief
saying by
348
00:19:07,246 --> 00:19:07,410
[david]: yes
349
00:19:07,294 --> 00:19:07,515
[casey_]: the way
350
00:19:08,010 --> 00:19:09,540
[david]: oh
351
00:19:08,478 --> 00:19:09,080
[casey_]: m but
352
00:19:09,540 --> 00:19:09,841
[david]: oh
353
00:19:09,602 --> 00:19:16,856
[casey_]: the so of i guess now i
want to i want to find
354
00:19:16,704 --> 00:19:16,786
[david]: ah
355
00:19:16,976 --> 00:19:17,697
[casey_]: out why
356
00:19:17,670 --> 00:19:17,790
[david]: oh
357
00:19:18,018 --> 00:19:22,445
[casey_]: kansas city and i know i know
why the general idea of saying hey higher
358
00:19:22,525 --> 00:19:31,310
[casey_]: cash flow but what other things stuck
out because right now the market basically there's
359
00:19:31,370 --> 00:19:36,959
[casey_]: no cash flow and just about anything
right now i mean there's some but it's
360
00:19:37,060 --> 00:19:39,824
[casey_]: not where you can go out and
provide a nice nine ten per cent per
361
00:19:39,984 --> 00:19:40,045
[casey_]: f
362
00:19:40,140 --> 00:19:40,241
[david]: oh
363
00:19:40,806 --> 00:19:46,652
[casey_]: and just really hand out good returns
right now obviously we think that the growth
364
00:19:46,732 --> 00:19:49,637
[casey_]: market is gonna is going to catch
up and then it's going to settle a
365
00:19:49,677 --> 00:19:53,483
[casey_]: little bit and go on but i
want to know what other reasons stuck out
366
00:19:53,543 --> 00:19:56,734
[casey_]: to you about kansas and what year
we're talking about two by the way
367
00:19:57,903 --> 00:19:59,854
[david]: what year of the asset or what
368
00:19:59,907 --> 00:20:00,048
[casey_]: yeah
369
00:19:59,934 --> 00:20:00,115
[david]: year
370
00:20:00,833 --> 00:20:04,271
[casey_]: what year did kansas city get on
what year was
371
00:20:04,260 --> 00:20:04,401
[david]: this
372
00:20:04,332 --> 00:20:05,195
[casey_]: kansas city here
373
00:20:05,124 --> 00:20:07,031
[david]: this is roughly
374
00:20:07,537 --> 00:20:08,407
[casey_]: oh
375
00:20:07,954 --> 00:20:08,757
[david]: eighteen months ago
376
00:20:09,647 --> 00:20:11,690
[casey_]: okay perfect so
377
00:20:11,782 --> 00:20:11,885
[david]: so
378
00:20:12,552 --> 00:20:15,637
[casey_]: what else about kansas city stuck out
because you know
379
00:20:15,660 --> 00:20:17,250
[david]: yeah
380
00:20:15,697 --> 00:20:20,385
[casey_]: you had about seven or eight different
areas that that that would could argue to
381
00:20:20,685 --> 00:20:25,270
[casey_]: argue you be excuse me be along
the same lines as kansas
382
00:20:25,200 --> 00:20:25,500
[david]: yeah
383
00:20:25,310 --> 00:20:27,613
[casey_]: city from from a cash flow perspective
384
00:20:28,066 --> 00:20:28,226
[david]: yeah
385
00:20:28,273 --> 00:20:28,554
[casey_]: um
386
00:20:29,148 --> 00:20:29,589
[david]: my my
387
00:20:29,515 --> 00:20:29,635
[casey_]: but
388
00:20:29,729 --> 00:20:29,910
[david]: answer
389
00:20:29,895 --> 00:20:30,135
[casey_]: why
390
00:20:29,950 --> 00:20:33,357
[david]: is probably going to sure my answer
may surprise you it had nothing to do
391
00:20:33,377 --> 00:20:34,038
[david]: with kansas city
392
00:20:34,598 --> 00:20:34,801
[casey_]: okay
393
00:20:35,662 --> 00:20:41,002
[david]: kansas city checked a few boxes but
it came down to the sponsor
394
00:20:40,837 --> 00:20:41,079
[casey_]: yeah
395
00:20:41,062 --> 00:20:42,124
[david]: for me more than
396
00:20:42,089 --> 00:20:42,311
[casey_]: okay
397
00:20:42,284 --> 00:20:51,098
[david]: anything else above all other metrics geographic
locations anything else the most important thing for
398
00:20:51,179 --> 00:20:55,622
[david]: me especially my first deal what's the
sponsor
399
00:20:56,457 --> 00:20:56,678
[casey_]: sure
400
00:20:57,450 --> 00:20:57,711
[david]: who was
401
00:20:57,682 --> 00:20:57,823
[casey_]: man
402
00:20:57,792 --> 00:20:57,812
[david]: i
403
00:20:57,903 --> 00:20:57,923
[casey_]: i
404
00:20:57,912 --> 00:20:58,254
[david]: partnering
405
00:20:58,024 --> 00:20:58,184
[casey_]: have
406
00:20:58,334 --> 00:20:59,279
[david]: with who
407
00:20:59,047 --> 00:21:03,835
[casey_]: there's deals in birmingham right now who
the hell would have ever thought birmingham would
408
00:21:03,875 --> 00:21:04,476
[casey_]: have been a hot
409
00:21:04,820 --> 00:21:04,983
[david]: yeah
410
00:21:04,897 --> 00:21:09,004
[casey_]: on fire market but it's the same
situation people are like man they go we've
411
00:21:09,064 --> 00:21:14,613
[casey_]: got these these first in class operators
that started buying there right and then all
412
00:21:14,633 --> 00:21:19,621
[casey_]: of a sudden i mean and that
comes down to the the that's a reflection
413
00:21:19,762 --> 00:21:21,925
[casey_]: on operators in general when they can
414
00:21:21,962 --> 00:21:22,122
[david]: yeah
415
00:21:21,965 --> 00:21:24,781
[casey_]: go into it kit like birmingham alabama
416
00:21:24,590 --> 00:21:28,888
[david]: well well to illustrate the point i'm
in
417
00:21:30,127 --> 00:21:30,412
[casey_]: oh
418
00:21:30,301 --> 00:21:32,616
[david]: just south of salt lake sam on
greater salt lake city market
419
00:21:33,148 --> 00:21:33,292
[casey_]: sure
420
00:21:33,310 --> 00:21:41,962
[david]: yeah i find it hard to believe
that someone in um m let's call it
421
00:21:42,062 --> 00:21:42,423
[david]: florida
422
00:21:43,502 --> 00:21:44,137
[casey_]: hm
423
00:21:43,548 --> 00:21:50,297
[david]: is going to have a better chance
of identifying quality opportunity before i do
424
00:21:50,837 --> 00:21:56,494
[casey_]: and that's the question that's exactly it
right there so
425
00:21:56,520 --> 00:21:56,900
[david]: yeah
426
00:21:56,574 --> 00:21:59,184
[casey_]: the operators start finding those opportunities right
427
00:22:00,025 --> 00:22:06,416
[david]: right at least at least that was
my mind set and it held true these
428
00:22:06,496 --> 00:22:09,761
[david]: guys that that i partnered with they're
429
00:22:09,697 --> 00:22:10,045
[casey_]: oh
430
00:22:09,821 --> 00:22:17,285
[david]: entrenched in the kansas city commercial real
estate market they have been there for five
431
00:22:18,147 --> 00:22:20,551
[david]: and fifteen sixteen years
432
00:22:20,957 --> 00:22:21,119
[casey_]: yeah
433
00:22:21,612 --> 00:22:26,100
[david]: they know that market i'm i'm not
going to go into that market and that
434
00:22:26,160 --> 00:22:26,260
[david]: i'm
435
00:22:26,287 --> 00:22:26,877
[casey_]: oh
436
00:22:26,300 --> 00:22:29,766
[david]: going to find a better opportunity and
be able to analyze that opportunity
437
00:22:29,798 --> 00:22:30,609
[casey_]: exactly
438
00:22:30,067 --> 00:22:33,232
[david]: it's not just about finding the opportunity
it's about identifying
439
00:22:33,148 --> 00:22:33,494
[casey_]: yes
440
00:22:33,292 --> 00:22:36,678
[david]: if it truly is a good opportunity
because of the market dynamics
441
00:22:36,347 --> 00:22:36,796
[casey_]: correct
442
00:22:36,758 --> 00:22:40,836
[david]: the geographic challenges or opportunities that are
there et cetera et cetera
443
00:22:42,107 --> 00:22:46,474
[casey_]: well and that's that's the whole thing
that really i think keeps a lot of
444
00:22:46,554 --> 00:22:50,140
[casey_]: people from figuring this figuring
445
00:22:50,760 --> 00:22:52,350
[david]: yeah
446
00:22:50,781 --> 00:22:53,466
[casey_]: out scale like everybody wants to scale
447
00:22:53,360 --> 00:22:56,940
[david]: yeah
448
00:22:53,526 --> 00:22:57,352
[casey_]: before they and start right but but
then you sit down and you start looking
449
00:22:57,432 --> 00:23:00,177
[casey_]: you start taking the vision for the
next ten years and i was like okay
450
00:23:00,778 --> 00:23:06,087
[casey_]: i want to be in whatever market
right and it could be any of then
451
00:23:06,207 --> 00:23:08,952
[casey_]: people have a hard time deciding well
i want to learn this mark i learn
452
00:23:09,012 --> 00:23:13,359
[casey_]: this market what happens if something happens
here and it becomes the it becomes a
453
00:23:13,399 --> 00:23:17,225
[casey_]: barrage of whatever you've got going on
so it's interesting to finally come across the
454
00:23:17,245 --> 00:23:21,493
[casey_]: mind that saw market chosen operator and
said hey these are my guys because those
455
00:23:21,553 --> 00:23:26,902
[casey_]: geographic fences can be awful tall for
people who have lived worked
456
00:23:27,271 --> 00:23:27,435
[david]: yeah
457
00:23:27,322 --> 00:23:29,486
[casey_]: and know a specific market like you
said
458
00:23:29,790 --> 00:23:30,450
[david]: yeah
459
00:23:29,887 --> 00:23:33,256
[casey_]: there's very little chance that somebody from
florida is going to come into your area
460
00:23:33,878 --> 00:23:39,490
[casey_]: and know hey man this apartment billing
here is worth money it's the best damage
461
00:23:39,570 --> 00:23:42,253
[casey_]: the best deal i found all year
well he didn't know that there's a new
462
00:23:42,333 --> 00:23:44,576
[casey_]: sewer plant getting put right across the
street
463
00:23:45,183 --> 00:23:45,427
[david]: right
464
00:23:45,438 --> 00:23:47,404
[casey_]: and that's why the damn thing is
so cheap
465
00:23:47,924 --> 00:23:48,148
[david]: right
466
00:23:48,367 --> 00:23:51,532
[casey_]: and so and that's what i mean
by
467
00:23:51,472 --> 00:23:51,553
[david]: ah
468
00:23:52,815 --> 00:23:56,400
[casey_]: that's why it's interesting to me for
people that they just bound out of where
469
00:23:56,421 --> 00:24:00,627
[casey_]: they're at and go somewhere else and
it's i'm glad you made that connection of
470
00:24:00,668 --> 00:24:05,716
[casey_]: saying hey your operators are basically your
sole resource to start
471
00:24:06,310 --> 00:24:12,440
[david]: yeah so i mean that that was
my strategy and we we ended up acquiring
472
00:24:12,480 --> 00:24:13,502
[david]: that deal it was
473
00:24:13,830 --> 00:24:14,377
[casey_]: hm
474
00:24:13,842 --> 00:24:20,754
[david]: roughly a ten million ten million dollar
acquisition we raid uh you know roughly three
475
00:24:21,315 --> 00:24:27,946
[david]: million dollars for that deal um and
you know i had prept my investor network
476
00:24:28,126 --> 00:24:35,175
[david]: long before that you know i had
spent of months trapping my investor network for
477
00:24:35,356 --> 00:24:36,418
[david]: what we were about to do
478
00:24:36,957 --> 00:24:37,078
[casey_]: yeah
479
00:24:37,520 --> 00:24:42,207
[david]: i had been emailing them i had
been having conversations with them about the strategy
480
00:24:42,288 --> 00:24:47,015
[david]: about the benefits of investing passively so
here's an example i have a client that
481
00:24:47,116 --> 00:24:52,384
[david]: you know many clients that own small
scale multi or even single a small single
482
00:24:52,445 --> 00:24:53,847
[david]: family portfolio they had
483
00:24:53,788 --> 00:24:53,909
[casey_]: true
484
00:24:53,907 --> 00:24:57,513
[david]: built up a tremendous amount of equity
in those properties right and
485
00:24:57,447 --> 00:24:57,589
[casey_]: yep
486
00:24:57,653 --> 00:25:02,442
[david]: one of the top things that i
review with my investor clients and and one
487
00:25:02,482 --> 00:25:10,114
[david]: of the u one of the metrics
that most important to an investor and probably
488
00:25:10,154 --> 00:25:13,319
[david]: the most overlooked is return on equity
489
00:25:14,067 --> 00:25:14,190
[casey_]: yep
490
00:25:14,530 --> 00:25:19,761
[david]: so many of my invested clients get
caught up on their cash on cash return
491
00:25:20,462 --> 00:25:24,800
[david]: and how much equity they have built
up and what their net worth is and
492
00:25:24,840 --> 00:25:29,488
[david]: they lose sight of how much how
hard that equity is working for them
493
00:25:29,547 --> 00:25:29,648
[casey_]: yep
494
00:25:29,908 --> 00:25:33,314
[david]: and so one of the first conversations
i have with my investor clients that already
495
00:25:33,394 --> 00:25:37,802
[david]: have a portfolio small portfolio and especially
if they but in the last ten years
496
00:25:38,242 --> 00:25:41,327
[david]: goodness gracious they've built up a tremendous
amount of equity the question
497
00:25:41,137 --> 00:25:41,260
[casey_]: yep
498
00:25:41,368 --> 00:25:45,454
[david]: that needs to be asked is how
how hard is that equity work working for
499
00:25:45,514 --> 00:25:50,903
[david]: you and what is your return on
equity so if that return on equity once
500
00:25:50,964 --> 00:25:54,790
[david]: we take them through a process of
evaluating the return on equity which i'm happy
501
00:25:54,850 --> 00:25:57,855
[david]: to share a tool with your listeners
i've got a free tool where they can
502
00:25:57,935 --> 00:26:04,346
[david]: get their own in just five minutes
plug in their numbers and identify their return
503
00:26:04,426 --> 00:26:04,847
[david]: on equity
504
00:26:05,228 --> 00:26:05,389
[casey_]: sure
505
00:26:05,568 --> 00:26:10,396
[david]: but we run them through that analysis
and if they're if they're getting a poor
506
00:26:10,456 --> 00:26:13,502
[david]: return on the equity that they have
tied up in that property it's time to
507
00:26:13,542 --> 00:26:15,126
[david]: re position that equity through
508
00:26:15,037 --> 00:26:15,160
[casey_]: yep
509
00:26:15,166 --> 00:26:19,536
[david]: an exchange through a refinance or through
a sale and in some cases the equity
510
00:26:19,576 --> 00:26:22,492
[david]: is performing just fine and it should
stay put in
511
00:26:22,578 --> 00:26:22,759
[casey_]: yeah
512
00:26:22,592 --> 00:26:25,537
[david]: many cases it needs to be re
positioned to get it working harder and so
513
00:26:25,837 --> 00:26:28,322
[david]: that's what we did with a lot
of our clients which sort of prep them
514
00:26:28,502 --> 00:26:34,210
[david]: saying hey you guys might want to
consider exiting through a refining or through a
515
00:26:34,351 --> 00:26:39,855
[david]: sale and getting into these type of
opportunities in a higher cash flow market that
516
00:26:39,895 --> 00:26:43,358
[david]: could provide better returns than what you
recurrently getting with the equity that was tied
517
00:26:43,398 --> 00:26:44,059
[david]: up in your property
518
00:26:44,917 --> 00:26:51,528
[casey_]: sure and that's exactly right when you
start gaining equity in your property put it
519
00:26:51,788 --> 00:26:59,762
[casey_]: to work don't just because honestly the
what he just sitting there is no better
520
00:26:59,862 --> 00:27:01,485
[casey_]: than just having cash in the bank
521
00:27:01,901 --> 00:27:02,002
[david]: ah
522
00:27:02,378 --> 00:27:09,522
[casey_]: and both are susceptible to cost of
inflation right because obviously well now maybe not
523
00:27:09,562 --> 00:27:13,829
[casey_]: necessarily the equity because the equity is
going to increase as inflation increases and the
524
00:27:14,450 --> 00:27:17,175
[casey_]: youryou're continuing to pay down the property
but i guess what i'm getting
525
00:27:17,130 --> 00:27:17,271
[david]: well
526
00:27:17,255 --> 00:27:17,315
[casey_]: at
527
00:27:17,311 --> 00:27:17,451
[david]: what
528
00:27:17,475 --> 00:27:17,676
[casey_]: is
529
00:27:17,511 --> 00:27:22,985
[david]: happens what happens is that over time
as you pay down your debt your return
530
00:27:23,046 --> 00:27:23,948
[david]: on equity goes down
531
00:27:24,477 --> 00:27:24,580
[casey_]: yeah
532
00:27:24,930 --> 00:27:30,760
[david]: so as equity builds up whether it
be natural appreciation or forced appreciation guy as
533
00:27:30,820 --> 00:27:34,686
[david]: that equity builds up and yu pay
down your debt over time your return on
534
00:27:34,766 --> 00:27:38,733
[david]: equity is going to go down that's
why you often see re finance is happening
535
00:27:38,813 --> 00:27:40,215
[david]: in three to five years
536
00:27:40,647 --> 00:27:40,771
[casey_]: yep
537
00:27:40,897 --> 00:27:44,723
[david]: because it's time to re position that
equity get it working harder for you so
538
00:27:44,903 --> 00:27:48,269
[david]: generally speaking that the risk is and
i have a lot of clients that are
539
00:27:48,309 --> 00:27:54,487
[david]: very real verse in many cases i
have clients that carry no debt um they
540
00:27:54,567 --> 00:27:58,413
[david]: just won't do it now i'm not
a proponent of carrying no dat i think
541
00:27:58,493 --> 00:28:01,718
[david]: that's one of the major benefits of
investing in real estate
542
00:28:01,737 --> 00:28:01,859
[casey_]: yeah
543
00:28:02,239 --> 00:28:09,731
[david]: right so what what we do is
we discuss what's a conservative amount of equity
544
00:28:09,832 --> 00:28:14,860
[david]: that you want to keep in the
property and if it's over that conservative amount
545
00:28:15,140 --> 00:28:19,408
[david]: let's get that remaining equity that trapped
equity working for you and so
546
00:28:19,407 --> 00:28:19,552
[casey_]: yep
547
00:28:19,448 --> 00:28:25,157
[david]: that's one strategy re financing getting that
back up to a comfortable level of debt
548
00:28:25,598 --> 00:28:31,067
[david]: where you're still safe where you still
have great debt service coverage but
549
00:28:30,847 --> 00:28:30,988
[casey_]: yep
550
00:28:31,368 --> 00:28:35,046
[david]: you have this other equity you can
go and continue to build your portfolio
551
00:28:35,877 --> 00:28:41,902
[casey_]: yeah and and then and then potentially
even from their diversified diversify asset classes diversify
552
00:28:42,402 --> 00:28:46,026
[casey_]: locations diversify whatever it all makes perfect
sense
553
00:28:46,151 --> 00:28:48,479
[david]: yeah you know what i got to
harp on that too because this is a
554
00:28:48,499 --> 00:28:55,441
[david]: conversation that i have with my clients
yeah i can help one of my local
555
00:28:55,541 --> 00:29:00,870
[david]: clients go buy a let's just use
a fourplex because it's simple and people can
556
00:29:00,910 --> 00:29:01,591
[david]: wrap their heads around
557
00:29:01,697 --> 00:29:01,859
[casey_]: sure
558
00:29:02,853 --> 00:29:07,261
[david]: they can go in my market today
you're going to spend eight hundred thousand to
559
00:29:07,441 --> 00:29:15,638
[david]: one point four on a flourplex so
you're plopping down you know at a minimum
560
00:29:16,339 --> 00:29:19,424
[david]: two hundred thousand dollars to get yourself
into a fourplex
561
00:29:20,127 --> 00:29:20,270
[casey_]: yep
562
00:29:20,746 --> 00:29:26,283
[david]: that's great and for many people that
optimal and it's the right move in everybody's
563
00:29:26,625 --> 00:29:31,536
[david]: case um their desires and what they're
trying to accomplish with their portfolio is going
564
00:29:31,556 --> 00:29:35,422
[david]: to be different some one that wants
to be hands on wants to own something
565
00:29:35,462 --> 00:29:38,347
[david]: right in their back yard maybe that
person a fourplex would be right for them
566
00:29:38,407 --> 00:29:44,003
[david]: in this situation but you take that
two hundred grand and you're buying four doors
567
00:29:44,404 --> 00:29:45,327
[david]: right four tenants
568
00:29:46,109 --> 00:29:46,291
[casey_]: yeah
569
00:29:47,000 --> 00:29:49,324
[david]: four streams of potential income well
570
00:29:49,227 --> 00:29:49,370
[casey_]: yep
571
00:29:49,384 --> 00:29:53,391
[david]: if one of those units go vacant
all of a sudden you know you're only
572
00:29:53,451 --> 00:29:54,673
[david]: seventy five percent occupied
573
00:29:55,287 --> 00:29:55,431
[casey_]: yep
574
00:29:55,334 --> 00:30:00,142
[david]: right whereas if we're buying a hundred
unit two hundred to three hundred unit apartment
575
00:30:00,182 --> 00:30:04,670
[david]: building and we have you now ten
units go vacant that's a different story right
576
00:30:04,730 --> 00:30:07,555
[david]: so you have a little bit of
safety in scale in my opinion but here's
577
00:30:07,615 --> 00:30:12,843
[david]: the bigger impact you can talk that
two hunter grand pop it down on one
578
00:30:12,944 --> 00:30:16,028
[david]: building in one location with only four
tenants
579
00:30:16,797 --> 00:30:16,918
[casey_]: yep
580
00:30:17,080 --> 00:30:22,673
[david]: or you could take that two hundred
grand and spread that out over four different
581
00:30:23,154 --> 00:30:26,281
[david]: investments commercial grade property
582
00:30:25,867 --> 00:30:27,697
[casey_]: oh yeah
583
00:30:27,243 --> 00:30:32,176
[david]: in four different locations with four different
sponsors four different asset types and four different
584
00:30:32,196 --> 00:30:35,477
[david]: business plans extremely diversified
585
00:30:36,107 --> 00:30:36,230
[casey_]: yep
586
00:30:36,840 --> 00:30:42,885
[david]: and that's what we do on this
indication side is we basically partner my goal
587
00:30:43,445 --> 00:30:48,069
[david]: for my investors is to give them
a variety of investment opportunities
588
00:30:48,837 --> 00:30:48,980
[casey_]: yep
589
00:30:49,010 --> 00:30:53,879
[david]: across geographic locations across operators and across
business plans
590
00:30:55,547 --> 00:30:59,293
[casey_]: and that's the one thing that always
seems to get left out of of a
591
00:30:59,333 --> 00:31:04,742
[casey_]: lot of people stop at diversify across
the operators they don't realize that diversifying across
592
00:31:04,762 --> 00:31:12,014
[casey_]: the operators also diversifies business plans because
there's it's like a fingerprint always seems like
593
00:31:12,094 --> 00:31:16,682
[casey_]: no two operators run something exactly the
same no matter how efficient it's running it
594
00:31:16,742 --> 00:31:21,430
[casey_]: seems like somebody always wants to change
some thing a little bit so anyway all
595
00:31:21,470 --> 00:31:26,178
[casey_]: right well listen so david we're kind
of running out of time here but i've
596
00:31:26,218 --> 00:31:29,744
[casey_]: got a few questions i want to
ask you that are just pertaining to you
597
00:31:29,904 --> 00:31:33,971
[casey_]: and what your likes are and the
first of those questions is what is the
598
00:31:34,051 --> 00:31:37,216
[casey_]: best book that you have recently read
or are currently reading
599
00:31:38,782 --> 00:31:41,507
[david]: um who not how i
600
00:31:41,547 --> 00:31:41,690
[casey_]: yep
601
00:31:41,587 --> 00:31:44,071
[david]: believe that's the right title who knows
how
602
00:31:44,911 --> 00:31:45,196
[casey_]: yeah
603
00:31:45,213 --> 00:31:51,362
[david]: m that's a great book about building
business through other p and putting people in
604
00:31:51,442 --> 00:31:54,065
[david]: place that have unique skill sets outside
of yours
605
00:31:54,837 --> 00:31:54,960
[casey_]: yep
606
00:31:55,526 --> 00:31:58,009
[david]: i would also mention the one thing
by garry keller
607
00:31:58,857 --> 00:31:58,981
[casey_]: yep
608
00:31:59,431 --> 00:32:05,461
[david]: it's a great very simple concept but
a very powerful concept about identifying the one
609
00:32:05,621 --> 00:32:10,349
[david]: thing that's ultimately going to have the
greatest impact on the end result and then
610
00:32:10,630 --> 00:32:13,106
[david]: cussing on that one thing and hammering
away on that
611
00:32:13,857 --> 00:32:18,224
[casey_]: yep and man both great books and
i know i can tell from talking with
612
00:32:18,264 --> 00:32:23,052
[casey_]: you is like your your sales experience
and your indication experience how well they go
613
00:32:23,132 --> 00:32:28,942
[casey_]: hand in hand and it's like ach
of those books kind of compliments each of
614
00:32:29,002 --> 00:32:35,432
[casey_]: those skill sets the sales and the
net working part of the indication although at
615
00:32:35,453 --> 00:32:40,279
[casey_]: the same time they chris cross and
they both can compliment one another so
616
00:32:40,320 --> 00:32:40,581
[david]: oh
617
00:32:40,760 --> 00:32:44,744
[casey_]: all right so the next question is
what is a dream vacation that you have
618
00:32:44,764 --> 00:32:46,066
[casey_]: either taken or hoped to take
619
00:32:48,639 --> 00:32:52,994
[david]: m you know i'm a pretty simple
guy um
620
00:32:52,819 --> 00:32:53,023
[casey_]: okay
621
00:32:53,375 --> 00:32:59,806
[david]: you know we're heavy heavy into youth
athletics and so taking vacations isn't really top
622
00:32:59,946 --> 00:33:00,587
[david]: mine for me
623
00:33:01,008 --> 00:33:01,532
[casey_]: understand
624
00:33:01,328 --> 00:33:07,619
[david]: my deal vacation which we take once
per year is going to lake power for
625
00:33:07,659 --> 00:33:09,261
[david]: a week on a nice house
626
00:33:09,169 --> 00:33:10,254
[casey_]: man
627
00:33:09,322 --> 00:33:12,687
[david]: boat with a handful of friends and
family we take all
628
00:33:12,668 --> 00:33:12,829
[casey_]: oh
629
00:33:12,707 --> 00:33:17,373
[david]: of our kids we got back just
a few weeks ago and we had five
630
00:33:17,433 --> 00:33:19,995
[david]: families like forty kids running around
631
00:33:20,367 --> 00:33:20,888
[casey_]: yes
632
00:33:20,916 --> 00:33:21,777
[david]: and just a
633
00:33:21,789 --> 00:33:21,809
[casey_]: i
634
00:33:21,837 --> 00:33:22,197
[david]: blast
635
00:33:22,069 --> 00:33:23,111
[casey_]: love lake pale
636
00:33:22,737 --> 00:33:22,838
[david]: like
637
00:33:23,872 --> 00:33:27,519
[casey_]: lake pale is probably one of the
coolest places i've ever been in my life
638
00:33:28,059 --> 00:33:31,125
[casey_]: and we it was a church trip
and we
639
00:33:31,152 --> 00:33:31,172
[david]: m
640
00:33:31,225 --> 00:33:34,330
[casey_]: went and we took that at a
big house boat right i'm sure that's
641
00:33:34,214 --> 00:33:34,296
[david]: ah
642
00:33:34,370 --> 00:33:35,432
[casey_]: what a lot of people
643
00:33:35,301 --> 00:33:35,322
[david]: h
644
00:33:35,492 --> 00:33:36,133
[casey_]: do that we rented a
645
00:33:36,189 --> 00:33:36,210
[david]: h
646
00:33:36,193 --> 00:33:40,961
[casey_]: house boat and all of us had
to get up top and the guy
647
00:33:40,972 --> 00:33:41,136
[david]: yeah
648
00:33:41,121 --> 00:33:43,726
[casey_]: drove it we went back in a
i don't know it called
649
00:33:43,704 --> 00:33:43,885
[david]: little
650
00:33:43,766 --> 00:33:44,266
[casey_]: a camera
651
00:33:43,985 --> 00:33:44,448
[david]: cover
652
00:33:44,447 --> 00:33:44,527
[casey_]: or
653
00:33:44,629 --> 00:33:44,810
[david]: yeah
654
00:33:44,667 --> 00:33:45,048
[casey_]: something
655
00:33:45,513 --> 00:33:46,719
[david]: yeah
656
00:33:45,609 --> 00:33:48,594
[casey_]: and we all had to get up
top and help guide the boat back
657
00:33:48,663 --> 00:33:48,744
[david]: ah
658
00:33:48,674 --> 00:33:50,176
[casey_]: into this thing we were back there
by ourselves
659
00:33:50,154 --> 00:33:50,296
[david]: yeah
660
00:33:50,397 --> 00:33:54,343
[casey_]: water as clear as you can clear
as far as you can see down oh
661
00:33:54,423 --> 00:33:55,525
[casey_]: man oh
662
00:33:55,391 --> 00:33:55,532
[david]: yeah
663
00:33:55,625 --> 00:33:57,030
[casey_]: man place was
664
00:33:57,668 --> 00:33:57,789
[david]: yeah
665
00:33:58,637 --> 00:33:59,842
[casey_]: so spectacular
666
00:33:59,888 --> 00:34:00,028
[david]: yeah
667
00:33:59,962 --> 00:34:00,043
[casey_]: so
668
00:34:00,109 --> 00:34:00,310
[david]: that's
669
00:34:00,143 --> 00:34:00,404
[casey_]: anyway
670
00:34:00,350 --> 00:34:00,812
[david]: a good trip
671
00:34:01,337 --> 00:34:04,282
[casey_]: awesome an we just keep the things
you and i have in common
672
00:34:04,696 --> 00:34:04,857
[david]: yeah
673
00:34:04,822 --> 00:34:10,572
[casey_]: just more and more the the all
right man so listen i know that there's
674
00:34:10,893 --> 00:34:14,799
[casey_]: some people out there who have heard
what you've said and are interested in possibly
675
00:34:14,859 --> 00:34:19,567
[casey_]: learning more about your vision from the
sale side or possibly your vision from the
676
00:34:19,627 --> 00:34:24,195
[casey_]: investor side or maybe there's an investor
out there looking to to place their two
677
00:34:24,255 --> 00:34:27,601
[casey_]: hundred thousand in capita and and they'd
like to maybe get in touch with you
678
00:34:27,641 --> 00:34:30,165
[casey_]: so what is the best way for
somebody to reach out and get in touch
679
00:34:30,225 --> 00:34:30,446
[casey_]: with you
680
00:34:31,651 --> 00:34:37,020
[david]: i'll give him two ways the first
is you can get a free copy of
681
00:34:37,260 --> 00:34:42,369
[david]: our return on equity report our return
on equity calculator so if you go to
682
00:34:42,649 --> 00:34:50,903
[david]: return on equity report return on equity
report dot com can download a free copy
683
00:34:51,184 --> 00:34:56,192
[david]: of our calculator which will allow you
to just plug in your numbers of any
684
00:34:56,272 --> 00:35:00,098
[david]: property that you currently own and it
will spit out what you're currently or what
685
00:35:00,139 --> 00:35:04,205
[david]: you should back potentially expect as a
return in equity in the next three years
686
00:35:05,147 --> 00:35:05,307
[david]: um
687
00:35:05,167 --> 00:35:05,289
[casey_]: sure
688
00:35:05,427 --> 00:35:09,294
[david]: then that can guide some decisions on
what you do with that equity so that's
689
00:35:09,334 --> 00:35:12,679
[david]: the first one and then the second
way is just go to canovo capital dot
690
00:35:12,780 --> 00:35:19,771
[david]: com that c a n o v
o kanovo capital dot com and just join
691
00:35:19,891 --> 00:35:24,499
[david]: our investor network there our team will
reach out with schedule call i'll jump on
692
00:35:24,539 --> 00:35:27,490
[david]: a call you talk to you about
your goals what we do on the indication
693
00:35:27,550 --> 00:35:29,758
[david]: side of things and would love to
chat with you
694
00:35:31,037 --> 00:35:35,164
[casey_]: awesome and awesome that's great and i
can't thank you enough for taking the time
695
00:35:35,224 --> 00:35:38,449
[casey_]: today to be with us i know
that you all are really busy over there
696
00:35:38,910 --> 00:35:41,775
[casey_]: i know that especially in some of
the market you're in that things are just
697
00:35:42,195 --> 00:35:47,063
[casey_]: booming in it it's hardly it's hard
to find time to like you said you're
698
00:35:47,144 --> 00:35:52,112
[casey_]: new sports my kids or new sports
so i get that completely but anyway thank
699
00:35:52,152 --> 00:35:57,361
[casey_]: you so much for your time david
and also thank you you're you're the free
700
00:35:57,441 --> 00:36:01,748
[casey_]: resource that you've offered the listeners and
listeners please go get that return an equity
701
00:36:01,848 --> 00:36:06,816
[casey_]: is a very very important piece of
this puzzle so and as always please head
702
00:36:06,957 --> 00:36:11,785
[casey_]: down and leave us a five star
review and while you're there please hit the
703
00:36:11,845 --> 00:36:15,571
[casey_]: subscribe button so that you can be
notified when we release episode when we release
704
00:36:15,651 --> 00:36:17,294
[casey_]: content and come
705
00:36:17,190 --> 00:36:17,370
[david]: yeah
706
00:36:17,414 --> 00:36:21,123
[casey_]: back and visit us soon again i
want to thank you david so much for
707
00:36:21,164 --> 00:36:23,752
[casey_]: your time and listeners thank you for
being with us today
708
00:36:23,529 --> 00:36:23,670
[david]: yeah
709
00:36:24,153 --> 00:36:24,735
[casey_]: have a good day