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All right, happy Monday, y'all. This is the Hive xlive meeting today. We have Schreier again coming more commercial stuff. Commercial is complicated, very complicated. But sure I breaks it down in the easy and not even easy, but it's it's understandable way he's got. He's doing a demonstration for us and doing different setups for us. So I hope you guys get a ton of value surprise here again, do 2.0 on part two or part two of commercial. But we talked a lot about last week if you guys didn't hear last week's. It was great. It was a great call. It should be going live this week. I think Thursday. So check it out. But check it out. Man, there's a lot of there's a lot of value you can learn and hope you guys learned a bunch about commercial here. This isn't like stuff you can use now if you're not at that level, but it's just stuff really gonna keep an eye out for the future and what it looks like. Right? Sure. Yep. And then I don't know, just raise your hand and tap into the right side of people that will do the job for you. And that's the beauty of friendship and relationship. Right. I always had read down on the wall is that real estate is extremely unfair business. extremely unfair. And we create the unfairness with the relationship. Right? No, we all know that sometimes we got to sell we're stuck. One phone call one tank boom. A buyer shows up and is done in five minutes. It's unfair. Okay, I'm sharing my screen. Can y'all see my screen? Yes. Awesome. Okay, so I had the agenda from last week. And then I'll kind of recap real quick that we get into it again. Absolutely here. Please ask me questions. I'll tend to talk a lot of give a lot of information. But wherever that you want to go. And go to sidewise says, let me know. I'll take a pause, we'll answer your question. So please do not feel shy about asking questions. Quickly, I think the rundown quick about me, I have a wholesale team I buy. I'm active buyer, I buy everything, and I extremely on the wholesale channel. And I buy land commercial triple net stuff and apartments as well. I've been in the business for four years now. I bought a little over 100 properties, and a roughly $12 million of equity that we deployed. And so I have extremely comfortable and working in a channel. Just like you guys, I do text I do call. We do yellow letter marketing everything I could catch to it. And do I take a look at it. It's a team, absolutely timipre Yes, I can buy 567 properties all by myself and go to the entire value chain. But the fun begins when I start sharing when we start talking to people and building a community. So that's that's quickly my, my company is into equity, can take a look at it. If you have any questions, just let me know. I'm in Texas market, I started looking at the Colorado market. And after I touch the Texas, Colorado, I'll walk into the Arizona market. That's my, that's my playground. On that note, I think we talked a little bit about the asset class and the asset categories. And we'll recap that a little bit, then we talked about building a team, I'll get to the very tail end of it. And we also give you a very high level, market location kind of sort of thing. So I'll start with the market first, then I'll walk you through the rule of engagement with seller. Because you know, texting and layer versus a house versus a triple net versus apartment is slightly different, then I'll give you some valuation methodology. Like stick your thumb on the air and see which will will destroy something like that just to kind of get you started. And also it is important because you know, so think about this way. We want to rely on the team. At the same time, we don't want to dump all the work on the team. So if I call Daniel Daniel, I got a property that's the address. That's one thing. Or Daniel either the property that's the address and condition 123 sellers asking for ABC, what do you think that's different, right? We want to be cognizant about each other's time how that plays into that, then I'll recap building a team. Alright, so understanding the market. So you can Google it, you can kind of sort of see what we add, especially it doesn't quite matter when it matters for everything. But on the commercial, it really matters because we are really tied up to the macro economic condition. Before the war, there was one kind of inflation after the war with Russia there is a secondary inflation that kind of kicked in. Now Fed said they're gonna increase the rate to no deflate inflation. Now inflation goes high high, they gotta go. Fast, fast, right. So that has to be an effect. According to your pricing, because again, we are doing a lot of loans, right. And on the loans, it's not like residential that you take one loan for 30 years, it's fixed on a commercial space, typically to five years below. So every five years, you got to refi. So you're always open to the market, you always ask yourself, What's going to happen to interest rate five years from now? It's going to change, it's going to eat my revenue, how that's gonna go. Right. And then you also got to know your local area. Right from from a residential side, we have some neighborhoods with cash flows, some neighborhood it appreciate, right? The same thing applies for the cities, some city are good for cash flow. You got Cleveland, Ohio, you are you got Milwaukee, it's all about the cash flow 2% rule, two and a half percent rule 3% rule, I get flooded every time I think about those numbers, but they don't appreciate you buy that thing. $100 Today is gonna be $100.05 years old. Versus you buy something in Austin, no cash flow, maybe zero cash flow. So you barely you can get long term debt on this depends on the market, and depends on the property. So in a commercial, you got a long term debt 25 years amortization, that's true, typically think not 30, the term is there, but it has a balloon payment. So every five years, you got to get out and refinance the property. So imagine, I bought something two years ago, $400,000 my P itI lack of better words is $1,000. My rent was stolen. Right? Now, my, my interest is high. So for same $100,000 property, same $1,200 rent by p, it is $1,300. But I'm not making money. Alright, so on the commercial, he really got to see it a little bit more broader term. Now, in my mind, commercial is five minutes or higher. Anything has a you know, triple net basis on it. So that's why understanding the market cycle, at least getting a part you don't have to know everything, just understand those inflation, higher interest rate. Right. And I got to factor that in my calculation, there is a handle price going up, it's not going to go up, it's going to go sideways, something like that. So that that's what really matters, though, in your city. Not all cities are made the same. Right? Just in Texas, I'll give you an idea of it right. Now, this setup of the rules that follows through everywhere. Just like you know, every city, the own subsection of the neighborhood, in a state every city in general quadruples, it becomes matter, because you know, it's a larger asset you're by. So in the state of Texas, Houston, in general, based on what it is, it's a slow moving economy. It's not a bull, it's not going to go up. That's also because it's all in Dallas, it's a higher than average. I would say appreciation compared to Houston. That's also because in dollars, because of the US China decoupling a lot of the high end manufacturing and going to Dallas. So if you know given all the things, if you invest $10 billion in Houston, versus $10 billion in Dallas, then you should get a better return in Dallas from a city perspective. Right? And Austin, it's a firecracker. It's like California. To buy something you barely buy, you buy it wait for six months, price goes up 20% 30%. So that's the idea. So getting to know your market, getting to know your city, getting to know what pockets of your city is important. That's what if I have a apartment in Dallas, I'll get the most amount of buyers or sellers looking for. If I have Houston second best. And Austin not everybody can play because pockets are tiny, it expensive ticket items. So as you look at the properties, we have to see that my commercial properties in the good neighborhood is in a and a good looking building. Do you think people who are driving a Mercedes will show up or a pickup truck was a lot because that's where the money is right? That's where the rent is. And that's how we take a look. So understanding the market is very important when you go price with them. And the last thing is financing not every city is made the same. We will find a lot of people on a bank loan on Dallas property, Keystone property Austin property, but they're not going to do in Oklahoma. You can flip a land on Oklahoma no big deal. 50 grand 100 grand but only asked for a $7 million loan. Oklahoma City is too small or state is not too big right? State doesn't have enough economic buying power. So radio be different. So that's why it's a it's a slightly different. Let me take a pause. Does anyone have any questions? Yeah, I kinda have a question. So smaller cities, and this is where the I think the power of local banks come in. So if you're in a smaller city, you might have to work with a local bank to get a local loan, just because the institutional banks will not lend because they don't have enough. They're not big enough, right? Yes. And then the last part is, you got to have relationship. Yeah, they're gonna trust us. That makes that makes a whole lot of sense. Because, like you said, if you're in a smaller market, the only people that will, yeah, that makes a whole lot of sense. No, but if you if you have, if you're in a big market, you can get money, a lot more places. So you're a lot more investment, well, that makes a lot of sense right there. And the smaller we go, you become more and more and more and more and more important. The further you go, or the larger areas that you go, asset becomes more and more and more important. Right? Because if you go to a little place, I mean, you know, I got an all summer and smaller town where they have to trust that you can turn things around probably you'll be taking the most amount of loan from the bank, who knows? Right? And unless you pay establish information, that's also why the clientele or the buyers become slightly different. Right. So that's any other questions? I don't see any Go ahead. Andre. Hey, sir, is beyond your Hey, hasn't hasn't gone? I had a question. So about the I definitely understand what you mean about certain markers they don't appreciate like some markers are strictly like cash flow, like you buy it up for 100. Today is going to be worth 105 years from now. I'm, I'm okay with it versus a market like that all these loans, I get them for a discount. And Amman, I put in doesn't put me way over what it's worth. But what are the down like the super downsides of markets like that like, like you said, like Milwaukee, in some parts of Ohio, where cash flow is good, but appreciation is nowhere. So what are some of the downsides of cash flow markets? Got it. So I'll give you the answer two ways, right? One way is you're buying one house or two houses, three houses, typically that's a lot of people will do they'll buy 10 At best, the delta? And then I'll give another answer as if you're building a business. Right? So one thing what everybody said, we kind of like the cash flow and replace our revenue on this other stuff. For me, it sounds cool. It sounds great. Everybody, we all have to start at some point in time I started same way. But what it boils down to cashflow typically will not make you what you want to have in real estate. It's when you sell take the equity out, that's what's gonna make you rich. Because if you buy that one house, you're making 200. So let me warn you that you're gonna buy one property, take a loan for 20 years, you're gonna No go through the whole rental process. And you're gonna have 200 $300 After all, expenses, cash flow. And I said and the under says, you know, what, I don't want to have, I want to $10,000 a month of rental income. You got to have more than 30 houses. Once you have 30 houses that goddamn business, every single day somebody is gonna call you can have it. So you got to have a team, you got to have a structure, you can have your own management company to have 30 and or you bake yourself in. So as an individual buyer, it's fine. You'll have a W two, whatever that you do, you're looking for a side hustle to make another $2,000 to get your vacation every year, fine, buy three houses, you'll make the money for houses, you'll make the money cash flow is fantastic. But always to flip it back that I want to make $10,000 Out of my cash flow. It is tough. That's the biggest downside of the of the No, the cash flow type areas. Right. And and appreciation you have it you barely make it through. But you have it for five years, your equity goes up high. Right? Make a big bang away. So I mean, it's it's a normal, it's a little like a process of growing up. Everybody goes from there. They look at their backyard, they look at their pockets, how much you have. And then you go to the areas where you can buy once you get comfortable but the low cashflow demister hydrating right. So it's a it's a cycle of process that everybody goes they don't see a question. Yeah, I understand. So for your case, man, you gotta buy tons, right, keep buying, scale it up. And then you get out because you started right you better you started so buy as many as you can, as you know, just stack it up, push yourself high and extremely like make a big pool. All of a sudden, little bit of cash flow bonus stacking up 1020 30 It becomes a media one and you can sell somebody has a portfolio or somebody could come in and really bite as a portfolio. Right? So if we're going to cash flow Fine, don't go for two or three or four properties go for 10 or 20. anybody else? Good question, by the way, I like it. So let me kind of dig a little deeper on this one, too. You said you have to have, once you get over 30 properties, you have to have a team in place, because it's not just you and your assets, it's how are you going to get more assets over 30? Is that what you're saying? No, I'm saying statistically, if I run a number, like, my rule of thumb, is that once you hit that 789 properties, then it becomes a full time job almost. Either you do the time. Okay, somebody else do the time. Yeah, property manager, you might have the property manager helping with the repairs and all that stuff. It's gonna get crazy. I mean, somebody else put in the time, and then you buy it, or you do it for free. Yeah, gotcha. Makes sense. Thank you, one hit the 30. And a 30 rents coming in, I got 10 days. The thing is, is that and you got to have a team in place. But again, understand that not everybody will think it through have 30 people managing the whole thing. It's such a bigger process, right? There's because I'm saying it, it may not be applicable to a lot of people, just to kind of share with you. Alright, so I'll get to this part of it. I think this is kind of a metaphor. So we all do text. Mostly here. Hi, my voodoo tax, right and ringless, voicemail, not that many calls, right? We have a mix of everything we majority has text, I would say but we do have people that use it for cold calling. Okay, I'll give you how at least I approach. Take with the grain of salt. I want you guys to test it and see what happened. Right? Not everything is perfect. But that's a way to get started, then you spin your way. Make it more better, right? So what we do on a land, less than 5060 grand 100% of the offer goes out to text. It's a stupid man, right? They start telling us you want to sell don't want to sell five. And a house, we titled The show up at the property and negotiating happens at the property. But before we go, we got to polish off the you know, property right. And yes, we could do on a on a text on a call. Well, we have seen better results better conversion, when you show up to the property and offering and working in front of the seller. On a commercial. All the text that goes out all the first call that goes out is nothing about the property. It's nothing about the seller, it's all about us getting ourselves all we want to know if you want to sell. So all we want to know if you want to sell out. So that's the first call, just understanding yes or no. Then the second call happens again on the phone. That's where we connect. And second call, we've got a discovery call. Second Call half of the call we spend to give them confidence that we can by other half is conditional up at the property. And the third time we show up at the property. And before we go to the third time of the property, we give them enough information about us so that we're comfortable and gathering information. So when the third call happens, we know that we're going to negotiate. Right, again, the first call it just to know. And I'll explain that to why the first call and the second call is discovery. And third call third conversation happens typically on site. That's our sequence. Why we have the sequence often because the most of the commercial. I know we may have some unusual cases. But in most of the commercial, they have some sense. They're pretty sophisticated. Right? Again, less than half a million dollar maybe not. But once you touch the million dollar hire zone, it even though there could be Mom and Pop, unless something extreme happen. They have some idea what they want. At the same time, they want to know, can you buy a million dollar product? Can you really drop off $50,000 on response. So that's where your art will come in. So you guys are fantastic on text. And the gods are fantastic on the phone. But can I play with it and the discovery call the biggest conversion that we have seen that discovery call we're able to build were we able to build the confidence that we have the caliber to buy whatever asset that you're going to buy? Because you know, in your mind, you know you've got a property and somebody is offering a full $100,000 And they're saying I'm going to close it for two days. They're saying I'm gonna do it cash. I was like, how many how many people I know, got that much money in their bank account. That mustering up, right? So play, play a little bit. And to me, that's the rule of engagement. Now, on top of that, we have almost almost all of us with the bigger team we've got VH right. We paid them what we paid them within a $4 to $1. Right. Understand someone who was paying that money may not have the strength of making that happen million dollar million dollar offer. They just don't because you're making you you admit billion dollar, it's a lot for me, love for all of us here. I mean some of us here. But again, if you go to Philippines, you go to whatever country that you go to, they're making four or five $6 an hour for them to even say million dollar, it's a big deal. At some point I had nine VAs and one guy that I work with 17 years, man, you should see how tough it is, right? Because it's a million dollar, once you realize it, it's it's so in your VA team. Understand that not everybody will be able to work in that channel. Even us, we don't know sometime how to have a million dollar conversation, right. And then around the VA s. So we have seen a decent amount of issue with that. So rules of engagement for our team, it's all they want to go backwards. conversation happens on site, if possible, but 100% of the offer that happens for the commercial habits of the US local guys. And they will never make enough for the commercial, their job is just to get the most out of it, then hand over to the local closing guy. And if it's big enough for them, in my team, if he touches a million dollar, I am on the sidelines, outreach, outreach, our Acquisition Manager how to do it, if he touches about million and a half $2 million, then he's gonna hand me over an outcome. Right? So it's like a staging impact. So all of us here, that when you get a commercial antenna up, we'll make an offer on the text, get on a phone call. Right? And then we can go from there. I'll pause here. Questions, comments, thoughts? Is there and I think definitely don't make offer 600%. But I think once you can you understand lucky explain, like, um, because brokers they kind of own the commercial realm, unless you're really good at going direct to seller. What are questions that you may need to research and further to have a, like a meaningful conversation with a commercial to show that you know what you're talking about. And like, and this is for everybody, like, there's different languages for different asset classes. And same thing with real estate. Like, if you're doing land, there's gonna be infill lots, there's going to be PARCC test, there's gonna be a whole different language. If you're doing single family, you're going to do short term rentals, Airbnb, there's all these terms, but it gets commercially might teach 12 noi, like, what? Where can people find those basic terms just so they can have a long term conversation with that seller or broker? Sounds good. I'll walk you through. That's a very good question. That was my second one. Give me about four or five minutes, we'll jump right into it. Oh, I know. You're covering it. My bad. Oh, that's awesome. That's awesome. This is absolutely right. Right. So those are a couple of four or five points you must remember tattooed in your brain. And it's not just commercial automatically. You blurt out four or five things works out perfectly fine. And I'll write it down for you guys. Very simple. Right. And that's it. And so, a couple of things going back, right? When you have a conversation with seller, not all of us here we work with the direct channel, right? Me personally. I don't touch any. And I don't me personally, me as a first time underwriting, I don't look at anything as my book is too many to buy. There is no point running a broker tests property. I love you guys broke I want to sell it when I lease up when I rent it. But now when I buy it, it's a very, I mean, I look, we all got to take our business, right? You do yours? We do us. And that's, that's why take a look at it. So automatically with a broker touch point. Plus, if I'm a wholesaler I mean hell now. Right? There's no point. And you'll get lucky. But there's no point on top of there's no point, right? Because, think about it. If I'm a broker, my job is to get the most value out of it. And I have my own network. Daniel gave me his property, I'd lost it out to everybody. Right? And then Billy shows up as a wholesaler to negotiate with me what the bill is gonna get out of my mind because I already pumped up seller with the high price. And I'm not being able to sell it because of the high price. And good luck getting the seller down at a lower price going through me. Right. So look, it's a slippery slope. So look looking for looking for deals, do not touch broker deals. Thank you, unless you have your money, you want to go buy the property or fine touch it but the channel that we work in, I love brokers when I sell, I want to lease up and I want to buy and anytime a broker shows up I come to my everybody my team from the VA will tell you, we'll take out the brokers but the conversation happened directly between you and I. They will take a chair there'll be on the sideline. Very simple. I'm not going to talk to the bookseller it's just not going to happen. We walked the property today. seller says I've got a broker so yeah bring it out. Broker came in tying all this thing I will give them a resume I said you want to go sideline let me go talk to him. Why don't you advise him? I don't want to go through you and talk to him. It just makes our life easier. We like it is better. So we don't mind having a broker but I just don't want to go through the broker. Now if the broker brings a deal along the route it but Happy to say out of my 180 deals, one came from a broker, they'll bring me deals just not gonna undermine, right? Let's get inside a call center channel survived me for last 20 plus two years, right? For at least 56 deposits I bought from all the other wholesalers. So that's, that's my take a look at right? Broker have their place. Awesome. Every time I sell it every time on a place, they want to get the market feedback, it's fine. So I have a good relationship with three brokers that I work with the handshake is they get to development, when I buy a property, I have to lease so they lease it for me, I don't even touch it. Right, that's their 6%. When I sell it, they get another 6%. So if the broker is really bad enough, I got two of them that I work with. I said, this is my project, I'll hold it for a year and a half, two years that I was selling, they'll come in next 6% of my lease, then wait for a little bit, come back and make another 6% when I sell my ask when I buy helped me, but don't get into it. So I can save the money. Give it to you guys. So we have three ways brokers to make money. So all the brokers, I tell them, take two shots, right? Leave one for me, it's a happy conversation. And it works. And it works. Last time, my biggest sale happened by the same broker he had, basically when I buy, and I didn't want to sell it, he says taptap sure I want to sell it, I gotta go who wants to buy? What, okay? So it's a, I'm extremely supportive of value add, somebody must be doing something to add value, not just one email, and not just, you know, property address plus, give it 3% and dump all the work on it, right. So that's, that's my Okay, so on the rules of engagement, please engage on the phone, but understand a little bit that you are on a first conversation, we got to be a little more defensive, which is we have to build the confidence that you can buy the property at the dollar value. Typically, that's where the team comes in. Right? I mean, some I'm 100% of the property that I look at, I can buy jack squat. But I got a team put together, we can buy everything. Right. So that's where the team comes in. Okay. So that's what I would say back to rules of engagement and building a team is very important. All right, so now I'm going to go to quick valuation methodology. Alright, so I'll give you the key terms, but I'm gonna walk you through first, and then we'll go from there. So whenever we took, we take a look properly, there are typically two different ways to take a look at it. First one is the back of the envelope real quick, the back of the envelope real quick, if you don't know anything about anything, and you don't want to do any work and just get to it go to last year to praise the price dot the damn price. You're not gonna go wrong. Okay, it just not gonna go wrong. That's just what last year's appraiser price offered that price. Okay, eight, nine out of the 10 times, you're going to be okay. And if you cannot get that thing and above the little bit in the boundary line, then you can tap on your team and you know, redo the whole thing and make sure you find. Okay, so now the question is, I really want the property, I know a little bit how I do it. One big thing in real estate on the commercial real estate, nobody works for free. Absolutely nobody. And nobody, and everybody has to pay somebody to do the work. So get that in your head that everybody must be paid. I cannot find my if I am a broker leasing my property, then I have to realize that 6% If this is broken, I'm gonna go fix it. Then my model has to say I'm going to hire Joe, who's going to go down. Okay. And if I have a property, I gotta go file a protest. I gotta hide the CPA to the protest, and he has to go in. And everything on a retail price. And that's that's one. So first thing you ask if something happens. There's a term called T 12. Or trailing 12 or T three, which is trailing three, right? Which is give me the last 12 months of expenses. That's all we ask. Right? That's all 12 Then or financial, or T three is trailing 12 months of expenses. Trailing three months of expenses. Okay. So that's one. And the second thing that we ask are we gonna know the the pricing? The pricing depends on the NOI net operating income. Doesn't matter what we do, then we'll come back to this one. You will come back to this one. I'll come back to this one. So why real quick? Yes, yes. So I'll use the single family perspective right. I will go down on a single family you collect the rent, right? Just collect the rent as owner, we got to rent in a commercial time, we call it a gross income. On top of everything to maximum, we're gonna get gross income is same as rent collection. And in that in the residential, we pay tax, we pay insurance, and we fixed it up, right. And after paying everything else, whatever is leftover. That's your net operating income. Very simple. You collect the check, you pay for everything, whatever is leftover. That's your net. And that's your. And your pricing will be based on data way different than they will kind of break out from the commercial. Right? Now. On the commercial side. Remember, there's three buckets, tax insurance and repair. Right? On the commercial, we ask you Is it least the answer is yes. Then you ask what kind? Is it a gross lease? Or it's a triple net? Or it's a double net? The triple lesbians is that one person could say on the on the house. My rent is $100. I mean, that's $1,000. We all know that's a gross rent, right? Even though what I'm saying because I collect 1000, IP, everything else on a commercial. It could be $1,000. And we asked what kind? If there's a gross, then you know, in a model, you have to factor in the cost, right? If they say triple net, then you ask is it net of tax insurance and repair. Some of the assets were seller or the tenant will pay for the repair up to some dollar amount. They will pay for the insurance. And also they will pay for the property tax. And they're going to cut your check after everything. So tax goes up. Good luck to them. Insurance goes up. Good luck to them. Right? Was the residential good luck to me. Right. So it's a slightly differently, right. And on the reverse. Your Cash Flow is fixed. Your NOI is fixed. Because sellers and the tenant is giving you money. Right? That's that's the differences. So we have a question. Michael blanc or Spencer Burton. I don't know Spencer's model doesn't quite ring a bell. But I know Michael blanks. I don't use the Michael blanks. I use something called synthesis. That's for the apartments. And this one, I found it online on the screen. Then I customized a little bit else for me that I use for everything. For triple for warehouse for which you'd call it any kind of apartments that we have, it kind of works out. So from five units, 200 units apartment, I'll plug in some numbers here, like after Honda unit is gonna calculate everything for us. Okay, but again, I don't want you guys to do this. This is not your role. Unless you're extremely advanced. Right? When you're coming in typical day, hey, I'm calling everybody. And I found a seller who got a commercial property. And then I gotta ask him what kind of building he has? And what is his? I like to do what you're talking about is to to all, or financial looks like and rental. Yeah, that's all. Yep. And just getting a key information. That's right. And, and if someone and if you really want to know how far you're at from the price, you see the asking price and you said the appraisal price? Further you go chances are it's going to be tough. Are you getting estoppels? Yes, it depends on the type. If that's a triple net, won't we do it? If that apartment? We don't? There's no point. Can you give like a brief description of what a sample is? Yes. So Stan, let me walk you out. And I'm going to give you an example. What what is so in a commercial space, everybody's fighting for everybody. Right? And I have a property today and I sold it to Daniel and Joel stays in my property. Joe and I could be fighting for something else. Maybe he tax was late I got a bill or he didn't repair I want to repair on the contract says repair. He says he doesn't think contracts repair we're fine. Daniel buys in. And if I don't resolve the fighting weekend, or the conversation with him, then that may trickle into Daniels ownership. estoppel certificate is a certificate with like a small form that the tenant fills out stating that he doesn't owe anything to the current owner. He or she or the tenant will not ask for anything from the new owner. So it's a clear super separation of ownership. It's a clear transfer of issues are no issues and it's used to check Make sure the seller at 92 and the tenant in line two, so both agree on what the terms are, what their lease agreement is, they know everything on the same page. So you're not buying somebody that's behind on their their rent. And the end, the seller is telling you, they're caught up. Yeah. And this becomes prevalent when you go higher and the prices, and most of the time, people who are talking to us directly, they will not offer a stop or something like that, you can go ask for it. But if you get to the high end stuff, expensive stuff, then it becomes more and more prevalent. Gotcha. Appreciate that. So again, on the on the valuation, so if you want to bring your team, going back to what I said, the valuation takes time, doesn't happen. It takes for me, it takes two, three hours to underwrite something as fast as I can get apartment takes about a day, day and a half, right? Because it's not just plugging the number is understanding the story behind it. So the best place to tap it into somebody else, respecting their time, it's you get the T to all about the financial, you get the rent roll, and you got a price out of it. If you can get those two data points, then you can say hey, versus a prison. But hey, Tim, this is what I got. And this is what it is. That's a very good point to stop. It's very good point. And whoever plays in the local market, they should look take a look at it. If you give me an apartment, and you tell me what the rental looks like dollar per square footage, and then you give me an idea of dollar per square foot is comprised I'll know right away whether something go oh, that's a no go. Right? That may be different in Dallas. That may be different and so but again, if you get those is very important, right? On a warehouse. dollar per square foot building going rate in Houston could be different than you know your dollars but if you're given a different role, I know exactly what kind of a lease that you have. Based on the price we can give you direction let's go on all right, but again, that's not you kind of set up the team to do the right thing for you. So you go negotiate right so that's what the team is very important in this case. But again, please don't if you if we decide that no sometime on the wholesale model, I want to get the list I want to call I want to negotiate. I want to put the contract on open the title then I find the display side as well and whole thing that whole process and a commercial is crazy. I have seven people team I got one MBA who works for me I got two accountants work for me but still that's crazy. So if you want to save your save all this misery still didn't find the team and to stay in one pack and then overtime you kind of grow right if you're if you're Avenue with deal making which is getting the leads in get delayed if your focal point is devaluation than just the devaluation if we're looking at the dispo then only go for the desktop don't try to go everything yes money is out there but what I said before it's a team of everybody and nobody works for free right and you cannot do it so the apartment when I buy a group part of a group one of the groups that I'm part of is called Jake and Gino they have seven eight guys in Texas all they do underwriter all they do underwriter So their goal is to in the life is right now if I see a property how fast can I underwrite and how fast can I tell the dealer to go or no? That's all what's up? Hey, are you are you seeing a an average I know some margins are different um, as far as in the commercial side. From from what I was from what I've been doing, I've been looking at like last year I would say like a deal would be like right around 6065 A unit and now I'm seeing in the different markets that is between about 79 and up into the 100,000 per unit depending on the market isn't right. And now I'm wondering if the if there's something that you're seeing a little bit different different types of pricing increase or different types of competition or deal coming in or what average sale price like okay, like with the guy referring to the NOI and the cap rate, got it? Got it? Yes, everyone the US price went up. But because of the inflation, right everyone suddenly caught on a little bit more. Right so stuff that used to trade for 70 grand right now expect at 85 grand, just because doing nothing absolutely not the same NY everything else. That's also because interest rate was in a good spot now rate is going up is going to eat up my noi. So we expecting a price adjustment as of now going to rate just went up two days ago or last week, right? So whatever price increase that you saw last six months, we're expecting a price adjustment from the six months a little bit more. But you're right, everywhere price went up on that note, caution. Do not again say do not take a look at cost per unit. That's a very flawed way of taking a look at it. Because cost of unit I may have 1000 square foot by unit. Daniel could 5500 square foot, it's San Antonio, the whole city, I feel like everything older, everything is like a 500 600 square foot, it's come to Houston. 1000 $1,202 per unit doesn't mean anything. So you need to go. And dollar per unit is a good thing. But second question right away get to dollar per square. It's a very good way. That way, it doesn't matter what the size is. And dollar per square foot is the lowest level of granularity. If the square footage right, then you can really see what it is. But you're right, everywhere. Price one, everywhere. Good question. Thanks. Thanks, man. Any other questions? I don't see any right now. Okay, okay, perfect. So I'll talk a little bit more liberal on the lending, on the lending, at least on the Houston market on the Dallas market, on the International Space, if the building is empty, we're not seeing loans being given out. So, a majority of the bank will not give you the law. So you have to have something else for them to get into law, they are looking at it called speculative play into warehouses empty. Right. So when you price it, understand that or have that information in your arms only gonna negotiate negotiate as such, right. On the apartments, we're seeing loans in my mind apartment is five units of or higher, or anything less one to four, residential, five or higher those apartments. We're seeing a blend of lending as well, but very cognizant about the interest rate and impact to the for price. Mostly what I have, okay. Last thing I want to cover today is the building a team building a team, and I'll pull up a presentation for us take a look at it. Then I'll walk you guys through how to build a team or how I went about building a team. Give me just a second as I may have shared this screen before. So most of the time, whenever we run the evaluation process does the sequence of what happens. We got the engagement. We got the underwriting cut the negotiating, and the capital acquisition Asset Management. I'll give one a study, we found a property from another team who does direct to seller, and it came out to be a $5 million asset. And we did the first underwriting right I led the way to underwriting. And then it was in Dallas market, I'm not familiar with it, I tapped into my partner, Sanjay, he's from another deal I work with him he took over the contract and negotiate. Now we have to think it through on a larger asset, you gotta open up to three LLCs you have to hire attorneys, you have to talk to the lender. And if you take a loan for an started lenders, before you start the lending process, you got to pitch in a 1% down payment and a good way to a lender on top of the seller on top of the attorneys. So he that he is going to factor in all the prices and see what the look like. Interestingly, on a $5 million deal, we thought we have to raise 1.5 1.6, but then to just send an email out and say now, I love y'all, but don't love you that much. You need to raise $2 million dollars on a $5 million deal. He got to bring in $2 million. Now we're going to go take a look at how to raise $2 million. How many people are going to talk and who's gonna be the investor works that kind of stuff, right? We got to go find the equity partners. And that's how then the acquisition and other process and so from your end when you build a team understand exactly where you want to go play and build a team around that. This is the entirety of the value chain. Some people could say I just want to reach out and my this is the one a bad start. And this is what my bus stops. So I want to know everybody who does the market assessment and let them deal with it. Somebody could say I have tons of money. I want to talk to people who are doing the underwriting Somebody could say I am a asset manager, I want to get to know who owns the assets. Right? So building a team, knowing your specialty, how you fit it, is extremely important. So if you're late and you're testing on a land, you were here, you want to stay here, you want to master it there. So you're gonna, your expertise will be, let me talk to somebody, they need to commercial, I'm not going to make an offer on the phone. And then let me ask those three things. And I will tap in Daniel, or Anthony or Deondre or Schreier, and they'll come back and do the work for us. Any questions and comments, thoughts on this one? I don't see any questions on this one? Awesome. Okay. So back to it. I think for today, I gave you guys a lot more probation. All right. That was amazing. Stryer. Again, a couple minutes early, but we we got it covered. You covered a lot I love this kind of this kind of reaffirmed if you're going after commercial. Well, I want to save another one for the next session. My goal was to kind of go through, do if we can underwrite? Yeah, yeah, that's, that's priceless. And that, that shows you where you can come in as a wholesaler, just by getting those that that prime information, if you get a price of the seller, the rent roll on the T 12. That's all you need just for us to do the underwriting. And on the hotel side election, the car shows we call it wholesale upside, right? The moment I have the contract, everything is on my feet, right? I own every single day. And when I and I get out the contract, when my time is running out, I'm desperate. In a commercial, there is no people got to do the work, and they have to take the loan. Right. And they just need some time. So you don't want to push for extremely highest price. Whenever you have done before done a deal before. You want to strike a chord between a balance who you know have worked with you before, has the caliber of take a deal down at that size. So you qualify them, and you get them cut loose early on. So they can do the due diligence, they can deploy the bank and they can get to work. So I would say be very cautious about it. That is not land or house for somebody who got 300 grand cash, pick it up, right. So cognizant about the time, what's the timeline for getting under contract is like, are you doing like 60 days? Okay, so question is gonna come your due diligence, typically other 20 days, then we'll have closing? Typically, it's 50. I say 57 days, bank says 55. I kind of make it a weird number 57. Not 60 to 57. And then typically, it's one extension for another 20 days. So the way it works, you put your earnest money here. After the due diligence expires, it goes hard. goes hard after due diligence time. And usually here, extension, this is an hard one. Yes. That means you don't get it back. Hey, so I have I have a question. This is the Andre thing. Um, I didn't want to ask this question from perspective. So I'm gonna land wholesaler, I can roughly do somewhere between eight to 10 land deals a month. And I can do it all virtually from you know, a different state. Now, when it comes to commercial, can I do eight to 10 commercial deals a month? And can I do it virtually from another state? Not the way your team is structured today. Absolutely, you can but not the way to the structure, you have to redo your entire team, we have to bring in a different set of people with a different expertise that you can do. So as possible is just the team will have to be different. It had to be. Yeah, okay. Makes sense. And also, because couple of things number one commercial target audience are smaller. On top of that, they are sophisticated. So it people will talk to even smaller, smaller. And then deals underwriting takes time to really slow down your process. So if you really want to do 10, then you have to marketing almost 10 times of whatever you're marketing on the land. Because the population will invest so commercial just takes a long time. Yeah, that's why that's why I asked that. That's why I asked that question. Can I do eight to 10 commercial deals a month because you can bigger takes longer? Yeah. So they'll do more often? Yeah, the more market right That's it. You want to control? And it's got a question boy. Yeah, real quick, um, I'm kind of new to I was looking into a little bit of commercial. I actually have a buyer that's looking for a warehouse. I'm in Atlanta, Georgia. I was just trying to think of good places to start looking. I guess I've never heard of Luton, it just thinking is other places I can look. I'm a warehouse that they're looking for. So before I give you the answer, you're gonna go build a partnership with somebody who wants to buy, but from what perspective as a wholesaler, or as a broker, oh, that person, wholesaler, okay? Then you can touch on the market, though. But having said that, keep that in mind. So he's gonna tell you where to go. But a couple of places you can go, you can go to, we call a loop net, right? That's one place. You've got everything there and other ones called Craxi. Your kretser.com. So between a Craxi and you're an LoopNet, you'll find everything was on the market. So most of the stuff, what was the last one? Cre exci Craxi? Oh, no, there's another different classes of larger brokers. They tend to have their own website. If you go to larger apartment, JLL, Marcus and Millichap. Bunch of other companies, they don't even know at least anything on Craxi and LoopNet. They have their own investor base, they have everything else, they manage everything. They're like the wholesalers on their name or broker type name for them, right. They don't buy it, but they they are keep calling. Every single day they wake up and call every single property owners on the market. It's like a boiler room. So they're going to call them they're going to say, I'm going to sell your $2 game with the $2 billion give me the contract. And they have a big distribution this they're gonna go and sell it. So right so it's a it's also an we look at a host that we call it wholesale, but they are doing the same thing what you are doing, but they're they're sophisticate on their brand is out there so for your end of it going to crack so you're going to look at and we don't want to hear it but chances are finding a property then double flipping it to somebody that's already in the market is tiny. But then you'll find you don't do that. Look, there are some wholesalers that the big one there too in the Houston market Northwestern and there's another one there in Dallas to the to the big, they will put properties from the MLS under contract then they'll then sell you on a investor database. But they go after that first time once and they got to the speed and you kind of know who they are right? We come in all this wholesalers and media knows. I know which wholesaler underwrites which way I know whose whole deals are garbage. absolutely got to don't even spend more than two seconds on it. I know there's some wholesaler that deal so bad as you know, they got a good deal. So you spend more time on it. So I would urge Don't be those guys. Be the guys really putting the time and getting a deal done. So you're doing the work, you know, and creating value for you and for others. That's a wholesaler we cannot we know they will take the life out of you and they're trying to be wholesome. And they're trying to be retail customers right and some of us we buy the usual best you can. So my ask here you got a good team hive mind you got some best and really awesome mentors. You got the Andre, Daniel, Anthony, all those guys. Learn how to negotiate, bring good deals. Don't drink anything. Just because you know a question Mitch, Mitch. Okay. Thank you. Appreciate that. So that's all I had for today. So I appreciate you guys the time and you know where I'm at. says, find me on Facebook or website or just reach out to Daniel Anthony. That's your first person to reach out to, then we can rest of the people show up behind. Man Schreyer Thank you for today. This is another another home run. I think you covered so much just the last two calls. I really appreciate it man. I hope everybody learned a lot. See the reason why I show up to these calls is because I'm asking the questions I want to know and commercials like I know a little bit about it. I'm just I'm learning every time I listen to the call myself. So there's opportunity for you to learn and expand on your knowledge. So don't miss opportunity. When it comes up. may not come up again. Right ratio. Next one, but the next one, next one next one. So we appreciate you man. Appreciate you coming out man and as such we had a good turnout today. Thank you hope you all learned something today. Even DeAndre was here learning. I know at the end of the day, Andre is asking me question. I was humbled. Thank you. But I look up to you for all the texts and what it does. I mean, seriously, I can look at his process. I was like, Man, you guys are just killing Like a destroying it. Yeah, it's amazing. So it's all we're all here to help each other. We're all here to help each other learn why? Hey, Daniel, figure out what's wrong with my eyebrows? Oh, I don't know. You gotta just come from a man depending on how I answer as long as you don't replicate what happened the boss made I'm not gonna say anything and that boy when like something else, I thought he was fake first. I was like, God, no, no, it was real. So what are we doing? I'm not doing that on purpose, man. I don't know what's going on. You have a filter on. We're gonna leave this in for the bloopers. Appreciate really coming out. Thank you Judge I think is Shahriar. NEXT CALL is Thursday. We'll see you all then. Preliminary coming up. Thanks for wire. Right. All right.