Ep #135 – Corey Peterson and Jack Bosch – Partnering Up!

 

  • Here’s some of what you will learn:
    • How to increase the NOI on a property.
    • Reasons why you should look into the expense ratio on a property.
    • Multifamily lives and dies by how well the property is managed.
    • Anytime you see an expense ratio over 50%, that is an opportunity.
    • Pay attention to the economic vacancy and economic occupancy based on the trailing 12 profit and loss statements.
    • Focus on cash flow, not value.
    • What to look for when the market contracts.
    • Why it’s smart to buy when the market crashes.
    • Why developing relationships now is critical.
    • Make sure to find an Attorney that goes through every detail.
    • Book Recommendation: The Go Giver by Bob Burg
    • Book Recommendation: Turn the Ship Around!: A True Story of Turning Followers into Leaders by L. David Marquet
    • Book Recommendation : The Richest Man in Babylon by George S. Clason
    • To contact Corey Peterson or Jack Bosch click http://www.kahunapropertypartners.com/
    • Connect with me on Facebook at Rod Khleif.
    • Text Rod to 41411 or visit RodKhleif.com for a FREE copy of my book, “How to Create Lifetime Cash Flow Through Multifamily Properties.”

Do you want to learn more about Multifamily Real Estate Investing? Work with Rod in the Lifetime CashFlow Academy's Multifamily Course & Coaching Program

Full Transcript Below:

Ep #135 – Corey Peterson and Jack Bosch – Partnering Up!

 

Welcome. This is the Lifetime Cash Flow Through Real Estate Investing Podcast. This is where you’ll learn strategies to help you achieve lifetime financial freedom through real estate investment. Your host, Rod Khleif, has owned over 2,000 homes and apartments. And he brings experts in all aspects of real estate investment and management on to the show. Now, here’s your host, Rod Khleif.

 

 

Rod Khleif:               Welcome to Lifetime Cash Flow Podcast. I’m Rod Khleif, and I am thrilled you’re here.  We have two hitters in the space, and one of them is a friend of mine, their names are Jack Bosch and Corey Peterson. They are with Kahuna Property Partners. I guess that’s Hawaiian, kahuna. That’s Hawaiian, right guys?

 

Corey Peterson:     Yeah.

 

Jack Bosch:             Yeah.

 

[chuckles]

 

Rod Khleif:               Well, welcome aboard guys. They’re both hitters in the real estate space, and very, very impressive bios. I think what I’m gonna do is really have them introduce themselves because they both come from different backgrounds. Now, I will say Jack emigrated from Germany. I emigrated from Holland, and so we’ve got some parallels there.

 

Jack and Corey have partnered on some multi-family, so we’re gonna dig in to all that. Corey you wanna start, and just tell my listeners how you got started in the business? Tell us who you are.

 

Corey Peterson:     Yeah, so I started in 2005, read Rich Dad, Poor Dad. That book changed my life, and said, “That’s what I wanna do.” I want time and money, and I went to work. I figured some things out, and what I found that I got really good at was raising private money. I was raising private money for my single-family deals.

 

Then something changed in 2011. I’m in the Phoenix market, and it was harder and harder for me to source good deals, and I always really wanted to do apartments. So I took the time to get really good at it, and have some really good mentors that showed me the way.

 

I raised about… My first deal in 2011, a $3.2 million purchase, and we raised $1.4 million of private money. We’ve been off to the races since, and what a wonderful process.

 

Rod Khleif:               Awesome. Awesome. Okay, Jack, tell us about you.

 

Jack Bosch:             Alright, wonderful. I have a little bit of a different background. As you mentioned it, I’m from Germany, originally. I came over to the United States in 1997, got the job, worked hard, didn’t really like my job. Then just very similar actually, read Rich Dad, Poor Dad…

 

Really started liking real estate, started liking, meaning to do something.  What I started then, buying and selling land. So I flipped over 3800 pieces of land since 2002.

 

Rod Khleif:               Wow.

 

Jack Bosch:             I’ve done a whole bunch of real estate since then, but I’ve never, but basically flipped land, the name sell land [00:02:45] for seller financing, and that’s kind of fun. I still do that but over time I realized the importance of true passive lifelong income, like passive cash flow that last for a lifetime.

 

So 2009, we started buying some houses but that’s kind of a little slow, single-families. Like you buy one, you buy another one, you buy another one. It’s a slow process and it does provide cash flow. I have a few dozen of those now, but it provides, in a sense, slow cash flow.

 

So then, at some point in time, I said, “Man, I gotta figure out that multi-family game because that’s the next step up. Right? That’s the next step up. I know how to flip land for income, I know how to have houses for cash flow, but in order to get more cash flow, and build more wealth, and so on, for us and our investors, I needed to do this thing.

 

Even though I have a lot of those experience, I really… This multi-family game is a little bit different. So I did what I always do, is I look for the best person that I can find, that I already know ideally, that can help me. I basically see if I can partner up, or learn from the person’s side.

 

Corey and I have known each other for several years already. We’re part of a mastermind, or a couple of masterminds together. So I went to Corey and said, “Hey, Corey, you’re Big Kahuna, right?” That’s how they call him. “You know apartment complexes really well. Can you show me?”  And then he’s like, “Well, ___ [00:04:08].” And he said, he just had a deal come up and he’s like, “Why don’t we partner up on that deal and you learn the ropes of it”.

 

‘Cause real estate is real estate but apartment complex just has… The operations are different. The acquisition is a little different. There’s a few things that are different that I just didn’t know after 3800th deals; I was not yet totally familiar with. So I teamed up with somebody that’s an expert in this space, and we’ve done one deal very successfully. We literally, this week, signed the documents for another deal.

 

Rod Khleif:               Let’s talk about that first deal, Corey, or whatever deal you wanna talk about. I’d like to dissect one of your deals. You just did one or two with Jack. Pick one of those, and let’s dig into it.

 

Corey Peterson:     Yeah, man, yeah. So we just actually did, we bought a deal in New Orleans in Slidell, Louisiana. That’s about 30 minutes outside of New Orleans, and we bought it for what, 3.6. Jack, right?

 

Jack Bosch:             Yes, $3.6 million plus $400,000 in CapEx.

 

Corey Peterson:     Yeah. It actually was a really unique deal, in that the day we’ve bought it, we have been cash flowing amazingly great. In fact, we started off; I think our NOI was about $26,000 the first month in operations. Six months down the road, we’re now at $46,000 in NOI.

 

Rod Khleif:               Wow… So why was it so low when you bought it? What was the value add there? What did you encounter? Then what did you do to turn that around?

 

Corey Peterson:     Believe it or not, it was more an operational play. I mean almost… we’ve not even done any really rehab to the property yet, like major. We’re budgeting to replace the entire roofs and paint all the outside. But all we really, really did… It was already 90% or 93% occupied when we bought it.

 

We guessed that payroll was super high, and there’s super high expenses. I think the people that were owning it were just not seasoned operators. They were over paying for a lot of things, and we just came in there, and replaced a couple of staff that we didn’t need, and just really trimmed all the fat. By trimming the fat, now we’re at 100%, and that’s typical in a lot of our properties. We run a very high expectation of filling every unit.

 

Rod Khleif:               So it was just reducing expenses, it wasn’t raising rents.

 

Jack Bosch:             Not yet.

 

Rod Khleif:               Okay.

 

Corey Peterson:                 Yeah. We’ve been raising rent… Well, we are raising rent. So on our new units just… We’ve not even approved the units yet. We’re still getting a $60 bump in rent for new rentals. Then on all our renewals, we’re still getting a $15 renewal increase.

 

Rod Khleif:               Wow.

 

Corey Peterson:     Slow and steady wins the race.

 

Jack Bosch:             Yeah.

 

Rod Khleif:               When you analyze this property you identified the fact that they were running at a high expense ratio, I assume.

 

Jack Bosch:             Yes.

 

Corey Peterson:     Yeah.

 

Rod Khleif:               Okay. That’s something I really wanna flag for you guys that are listening to this or watching this, in that a lot of times people will overlook deals, and not really drill into the numbers. See, a lot of people wouldn’t have noticed that. They wouldn’t have noticed a high expense ratio.

 

My hat’s off to you guys because there are diamonds in the rough out there that show a low cap rate but they might be running it a 60% expense ratio. And there’s just such a huge opportunity there, that they’re kind of in plain sight. But people don’t drill down to see it. Would you agree?

 

Jack Bosch:             That’s exactly what happened, it’s actually it.

 

Corey Peterson:     Yeah.

 

Rod Khleif:               Okay. Okay.

 

Corey Peterson:     Yeah. We bought it at a seven cap, like when we forecast, we’re modeling selling it at a seven and a half cap.

 

Rod Khleif:               Right.

 

Corey Peterson:     And so, even worse, right? But we think it ought to be better but if we’re gonna model, it’s model conservative, and we’re still cash flowing really good.

 

Rod Khleif:               Awesome.

 

Jack Bosch:             So Rod, if I can add something here to that. What I learned, what I understand from this process is, what has really been drilled into me and what I really appreciate is that multifamily lives and dies by the operational efficiency, by how well you run the property.

 

Rod Khleif:               Right.

 

Jack Bosch:             So when people buy properties, if they just mismanage just buy a little bit, and you can come in and you manage that part better, then you can make a ton of difference in there. We didn’t raised rents right away; only in the new units we’re raising rents. But instead our property management company, that we’re aligned with, came in.

 

They first of all, they turned everything into electronic file keeping, and electronic measurements. They got the economic occupancy of the property up. The property was 91-95% occupied but had a bunch of people that paid late. Well by getting rid of that… or didn’t pay, or a bunch of evictions that they hadn’t really done, it’s done. By us coming in, and by changing that, we really, we got the money that was supposed to be coming in; we got that to come in.

 

Then the next step is to get better tenants in there and show them that we care. Overall then and now, the repairs are coming. So it’s like a staggered approach but it all comes down to running the property really, really efficiently and well.

 

These guys, they were making money on this property. They weren’t losing money on it.

 

Rod Khleif:               Right.

 

Jack Bosch:             But they were just not running it well. Actually, the expense ratio was well above 60%.

 

Rod Khleif:               Wow.

 

Jack Bosch:             And we dropped that right away down. I think that’s just the key thing for everyone to listening. To keep in mind that if you don’t have a real operational excellence or somebody that’s run this place, a good property management company at your hand, then this can be dangerous. But if you have, you can take deals like that and bring them out to the roof. It’s amazing.

 

Rod Khleif:               Okay. Okay, yes, so it was actually running over 60%. Guys, anytime you see over 50% there could be an opportunity, there likely is. ‘Cause 50 is about an average.

 

Corey Peterson:     Yeah.

 

Rod Khleif:               That’s awesome.

 

[00:10:00]

 

Rod Khleif:               I’m really glad you brought up economic vacancy. That’s come up many times in the past, so guys, you may get a rent roll that shows 30,000 a month on the rent roll but they may only be collecting 20,000 a month. So very, very important that you pay attention to economic vacancy and the economic occupancy based on the trailing 12 profit-and-loss statement. You see what they’re actually depositing.

 

What kind of debt did you put on it?

 

Corey Peterson:     We actually were able to get a Freddie loan. Now, one of the things we’ve been doing lately, and it makes a lot of sense, is that we went and got a seven year fixed Freddie loan at 80% LTV.

 

Rod Khleif:               Okay.

 

Corey Peterson:     So that was really nice, and then it has a prepayment schedule of, we call it 5-4-3-2-1-1 .(dash or no dash?)[00:10:43]

 

Rod Khleif:               Yeah, the deficents (or is it deficit?) [0010:45]

 

Corey Peterson:     Yeah.

 

Rod Khleif:               So you got a nonrecourse debt…

 

Corey Peterson:     Nonrecourse.

 

Jack Bosch:             Nonrecourse.

 

Rod Khleif:               Yeah. Yeah.

 

Corey Peterson:     And then we asked… It actually turned into an adjustable, and after that for another 13 years.

 

Rod Khleif:               Nice.

 

Corey Peterson:     Now, there’s a reason why we did this though. It is because we are syndicating. We raise capital, and there is a change coming, we don’t know when…

 

Rod Khleif:               Right.

 

Corey Peterson:     So we got to be very prepared for our investors, so this is a safety play for us. Didn’t cost much to do this but it allows us to have a note, where we know it’s not gonna get cold.

 

Rod Khleif:               Right. Right. Anybody that’s putting five-year debt on a property right now is… I mean…

 

Corey Peterson:     Ludicrous.

 

Rod Khleif:               Yeah, they’re playing Russian roulette. Guys, just so you understand why that’s a big deal, is you could be cash flowing great. I mean, this property could be cash flowing great, but if the caps rates have expanded because the market has gotten bad, it could likely be worth significantly less than it is now. So you wouldn’t be able to refinance.

 

If you’ve got to liquidate, if you have to refinance because you’ve got a five-year balloon, there’s nothing worse than having a cash flowing asset; that makes sense. But because cap rates have gone up so the values have gone down, and you don’t have the loan-to-value that you need to refinance, and you’re gonna give that property back to the bank. That’s why what Corey is talking about, is you have to do that.

 

I wouldn’t do anything less than seven years but what you did is even better, where you just go to an adjustable. Yeah, you got to pay a little bit for that but it’s worth every penny of that right now.

 

Corey Peterson:     Yeah, in gold. In gold.

 

Rod Khleif:               Right.

 

Corey Peterson:     Yes.

 

Jack Bosch:             Yeah, it’s our insurance policy, basically. Also for our investors… But yeah, it’s really our insurance policy to make sure that our investors’ money is safe. It’s insurance policy to make sure that the property is safe ‘cause the worst-case scenario, we just keep the property if the market crashes. We just keep it.

 

Keep paying everyone their dividends, and their preferred returns, and then when the market recovers we can sell. But as you start, exactly what you said Rod, we’ll never have to sell this property just because we are at that Russian roulette five-year mark or something.

 

Rod Khleif:               Right. Right, and that’s how a lot of people get hurt. I cringe when I see developments coming out of the ground right now because they’re playing Russian roulette as well. I mean, there’s no question where heading into a contraction but that doesn’t mean there aren’t great opportunities that you can make money with out there because there are.

 

As long as you’re focused on cash flow. I just got an email this morning from somebody, said, “Hey, this property sold for X back in 2008, and I can get it for Y today. And I said, “I don’t care. What’s the cash flow? What’s the NOI? What’s your new debt service coverage ratio gonna be?” That’s all that matters.

 

In fact, I’ll put a plug-in for my book. By the way, I wanna put a plug in for your book as well but my book How to Create Lifetime Cash Flow Through Multi-family Properties, the subtitle is The New Rules of Real Estate Investing. Basically, the new rule is focus on cash flow not value.

 

Corey Peterson:     Yes.

 

Rod Khleif:               Corey, I know you’ve got a book coming out, and it’s titled Why The Rich Get Richer: The Secret to Cash Flowing Apartments. You’ve also got a podcast coming out, and what’s that called Corey?

 

Corey Peterson:     The podcast’s gonna be Multi-family Apartments Investing Podcast.

 

Rod Khleif:               Awesome. Awesome. Guys, if you wanna contact Corey or Jack their website is kahunapropertypartners.com, K-A-H-U-N-A propertypartners.com.

 

Let’s move on to another segment of the show. This is a question that I like to ask sometimes, about a war story, and a victory story. You could start with the victory first, but then tell me about a war story too.

 

Jack Bosch:             The victory story for me really is the one that also drove me towards multi-family investing. Because the victory story is that, thanks to the land flipping deals that I’ve done, where we also sell properties with seller financing and then people pay us basically with great cash flow from land.

 

In 2008 and nine, we were in the lucky position that we actually, our business did not crash. We didn’t lose a whole lot. I mean, values of what we held on to went down, but other than that, we lose a whole lot. We actually saw real estate, America be for sale. We were able to jump in and buy a whole bunch of single-family houses, during that time. That now have tripled and quadrupled in value. I still hold most of those.

 

They provide nice cash flow but they also have made a big equity gain on there, like a seven-figure equity gain. Really, in that moment is when I realized like, “Man, I got to think bigger than just doing my… “ I mean 30,000 something land deals is really big…

 

Rod Khleif:               Right.

 

Jack Bosch:             But I realized, now, I got to play this again.

 

As we grew, as we’re looking right now in the economy… The economy is like heating up. Real estate is heating up. Both Corey and I think that there might be an adjustment coming at some point in time. One of the things I wanna do, my biggest regret is that I didn’t buy more single-families back then, or that I didn’t already get into multi-family back in 2009 or 10 and so on.

 

‘Cause obviously, the leverage is so much bigger if you… A property that’s worth $4 million can be worth eight or nine in over a five-year period, if you do it right.

 

Rod Khleif:               If you buy it the right time.

 

Jack Bosch:             If you buy it the right time. So what we’re doing right now is we’re looking very, very carefully. So my success story is, I did see that, I jumped in. I was able to buy something like 17 houses or so back then. And then let them ride up, and they’re worth like several million dollars more than they were, right now.

 

Rod Khleif:               There will be incredible opportunities, when this market contracts, no question, and exponential opportunities for appreciation, no question.

 

Corey Peterson:     Yeah.

 

Rod Khleif:               And contrary in investing is basically, selling now, getting into cash right now, and then when the market crashes, when there’s, for lack of a better word, blood running in the streets and everybody’s running for the hills saying real estate is terrible. That’s when you buy.

 

Corey Peterson:     Yeah.

 

Jack Bosch:             Yeah.

 

Rod Khleif:               Now, I got caught in that crush back in 2008. That was my blood running down the street.

 

[chuckles]

 

Rod Khleif:               But I will say, and those of you listening, don’t be discouraged because there are deals out there.

 

Jack Bosch:             Right.

 

Corey Peterson:     Yes.

 

Rod Khleif:               We’re writing an offer tonight, and we’re gonna have a 50% cash on cash return on this deal.

 

Corey Peterson:     Wow.

 

Rod Khleif:               There are deals out there.

 

Jack Bosch:             Yes.

 

Corey Peterson:     Yes.

 

Rod Khleif:               You just have to find off market deals, or you have to have relationships with brokers, but don’t get discouraged, because there’s lots of deals happening.

 

Corey Peterson:     And that’s exactly…

 

Rod Khleif:               But both eyes wide open. That’s the key.

 

Jack Bosch:             Yeah.

 

Corey Peterson:     Yes. Rod, let me give me give you a quick example. So for me, my first deal, I bought it in 2011. I bought it for 3.2 million. It’s now at five years later, so our average strategy is to hold them at least five years. Right? Increase occupancy, operation wise, I have it under contract now for 8.8 million.

 

Rod Khleif:               Wow. Wow.

 

Corey Peterson:     So that’s a $5 million… I mean, I’m making a million dollars a year. Now, I never banked on that. That’s just what happened.  ‘Cause I bank on the cash flow.

 

Rod Khleif:               Right.

 

Corey Peterson:     Just like you, you got…

 

Rod Khleif:               No, the appreciation is a bonus. That’s a quote from my book. By the way, I forgot to plug the… When I plugged my book, forgive me for this guy’s. This is shameless promotion. Guys, if you’re watching this, and you want it, it’s free. Just text ROD, R-O-D to 41411, and my book’s free.

 

But anyway, you’re right, because if you look at the appreciation as the bonus, if you look at the tax benefits as a bonus, if you look at the principal reduction as a bonus, that’s what it is.

 

Corey Peterson:     Yeah.

 

Rod Khleif:               But focus on the cash flow. Yeah, that’s an amazing deal, $5 million spread. Now, you bought… When did you buy that one? Like 09 or 10 or 11 or something?

 

Corey Peterson:     11, yeah. August 11.

 

Rod Khleif:               11, yeah. That is fantastic timing. And that timing is gonna happen again. That kind of appreciation play is gonna happen again.

 

Jack Bosch:             That’s exactly what we’re doing right now, actually. We’re preparing right now, doing very, very careful, sifting through hundreds of deals to find one.

 

Rod Khleif:               Right.

 

Jack Bosch:             Looking at deals that’s a safe deal, but building the relationships with the brokers and all that stuff to able to then, when that happens, be able to go big.

 

Rod Khleif:               I was just gonna expand on that, to say that. Guys, those of you listening, use this as an opportunity. Right? I mean use this as an opportunity to grow your network, to find investors, to develop those relationships, to develop the relationships with brokers, bankers, mortgage brokers, all of that.

 

We’re doing the same thing. We’re simpatico in that. Because when the market crashes, if you’ve got investors, and partners, and access to capital, there’ll be exponential opportunities.

 

Jack Bosch:             Yeah.

 

Corey Peterson:     Yeah.

 

Rod Khleif:               Alright, so tell us about your war story. I wanna hear when your blood was running down the street now. [chuckles]

 

Corey Peterson:     My biggest war story will come… Actually, was the same deal that I made all the money on, the deal I made all the money on. When I first came into that deal, it wasn’t my deal. Actually, I was representing the capital. I had lots of private money to come into the deal. So this is where I would say, “Know thy operating agreement and know thy partner.”

 

Rod Khleif:              [chuckles]

 

Corey Peterson:     Now, Jack I, we know each other very well but these two guys that I first went to business with, I didn’t know, and I didn’t read thoroughly. I was a little bit naïve. I’m gonna say… It hurts to tell this story.

 

[00:20:00]

 

Rod Khleif:               Uh… it means it’s a real one. And that means it’s a good one. Alright.

 

Corey Peterson:     So I negotiated a 75% ownership of this deal, when I first started. Somehow… And I was suppose to have 75% voting rights, because it was all my capital coming into the deal.

 

Rod Khleif:               Sure

 

Corey Peterson:     They were getting ready to lose it, and they were getting ready to lose their earnest money. I needed to close in two weeks. I was able to make that happen but somehow in between lawyers, and my lawyer missed it too, is that on the voting rights, it ended up being 33, 33, 33. All of a sudden, it was two against one, ‘cause I was the outside guy.

 

Rod Khleif:               Right.

 

Corey Peterson:     It about made my heart sink. It was the hardest thing to do because the operating agreement wasn’t written very well. It wasn’t my operating agreement; it was these other guys’.  So what I learn from that is know thy operating agreement, hire a good legal counsel to prepare one for yourself and for your team. Right?

 

Rod Khleif:               Yes. Absolutely. That is very critical.

 

Corey Peterson:     And make sure there’s language in there that spells out what happens if there’s ever a split up or how people get bought out or things like that. Very, very important.

 

Rod Khleif:               Critical. Yeah. You really need a good attorney to do that and I’ve seen attorneys that just boilerplate somebody else’s agreement, and they’re junk.

 

Corey Peterson:     Yeah.

 

Rod Khleif:               I’ve seen attorneys that literally, almost painfully, go through every detail, and that’s what you want.

 

Corey Peterson:     Yeah.

 

Rod Khleif:               You wanna go through that pain for something…

 

Corey Peterson:     Go through the pain now.

 

Rod Khleif:               Yeah, yeah, because you don’t want that other pain. A little bit of impatience and pain now is worth it. Trust me. Let me ask you guys this, what… and you guys, I know Jack… Jack, I wanna put in a plug for your land program. Because Jack, by the way guys, Jack is an expert in land flipping. Obviously, he’s done over 3000 deals so, and he teaches that.

 

But in your experience, what advice would you give someone that wants to get into this business? You’re talking about hundreds of units and that’s gonna intimidate some of my listeners. What advice would you give somebody hasn’t bought a unit yet?

 

Jack Bosch:             Well perhaps I can start that because I’m fresher in that game, is find a mentor. Find somebody that’s really, that has done the game before because it is like the beauty of land flipping is super simple. You got a buyer, you got a piece of land, you got a seller, you got a buyer, and you go flip it. It seems simpler than house flipping.

 

The apartment complexes, these multi-families, it’s a different game. You got sophisticated sellers, you got attorneys involved, you got PPMs involved, there’s a sequence of things that need to happen and so on. So find somebody that can help you understand how this works. Enroll in their training program or find somebody that’s already done a deal. Put some sweat equity in there, or do some of the work. Or if you have capital, put some of the capital in but partner with somebody up that you know well, that you can trust.

 

That’s kind of my thing in that because it is a much more complex animals than many other kinds of real estate. From both acquisition, as well as running it.

 

Rod Khleif:               Sure.

 

Jack Bosch:             Like a lot of people, that was my point earlier, a lot of people think it’s all done just running it then handing it off to a property manager, Rod. No, that’s why we buy our deals, because somebody bought it, ran it, and then didn’t run it as well as it should have been run, which then gives us the opportunity to buy it again, at a lower price, and bring it up.

 

Rod Khleif:               Sure.

 

Jack Bosch:             That really the key. There’s pieces through the puzzle on multiple ends, that you wanna make sure you get really, really good advice at the beginning. Get a course or team up somebody with that can show you how to do this.

 

Rod Khleif:               Oh, that’s good advice. That’s good advice. I also I do these little five to eight minute Driving For Success Tips on my podcast. Sometimes I’ll ask people what makes them jump out of bed in the morning? Where do they get their drive? I’d love each of you to answer that question. I mean, what drives you? What motivates you?

 

Corey Peterson:     Man, for me personally, I love it. I love the game of real estate. I don’t know. It’s like, besides my wife, it’s my second love. I love the process of getting a deal.

 

I barely made it out of high school. I’m a used car salesman. I sold cars for like, I don’t know, six-seven years. The chasing of the deal, the working out of stuff, I honestly, I really get a lot of fun and enjoyment out of that. It is why I come up to work. I like the chase.

 

Rod Khleif:               Now, that’s…

 

Corey Peterson:     As soon as we get done with the deal, and we’re kinda done buying it, and my operations work, ‘cause that’s kind of like an autopilot for me…

 

Rod Khleif:               Right.

 

Corey Peterson:     It’s not so fun. I like looking at it, going to visit it, but it’s not as fun anymore.

 

Rod Khleif:               Now, that’s a great answer. Jack, before you answer, I wanna hammer that home for my listeners. Guys make sure you associate pleasure with this business, if you’re gonna get into it. Don’t do it, unless you love it. If you don’t love it right now, make it so you do love it.

 

I use the analogy, hunting for treasure, ‘cause that’s really what Corey is describing here. It’s the thrill of the chase, and life is too short not to do what you love.

 

Corey Peterson:                 Amen.

 

Rod Khleif:               So be sure you’re doing what you love. And again, you can develop a love for this, by how you position it in your mind and associate pleasure to it. Great answer. How about you, Jack?

 

Jack Bosch:             Well, for me it’s… I always distinguish between two kinds of goals. I have distinguished between, what I call ‘means goals’ and ‘end goals’. Most people work, their job is a means goal. It’s the means to an end. When you go to work, you make money so you can enjoy the weekend or whatever people do.

 

Rod Khleif:               Right.

 

Jack Bosch:             Real estate to me, particularly multi-family, as well as other real estate, cash flow real estate, let’s put it that way. Cash flow real estate is an end goal in itself. Because it builds wealth, it builds cash flow, and it’s a ton of fun for me too. I love looking at deals. I love the creativity of making a deal happen, and how you can structure it to make it happen and so on.

 

It hits these three points. It creates wealth. It creates cash flow. And it’s fun to do. So if I can work in something that I have fun, that I build cash flow for my family, passive cash flow ideally, and also on top of it, through appreciation, build wealth, I’m in paradise.

 

Rod Khleif:               That’s a home run. That is a home run. Any way you shake it.

 

Corey Peterson:     That’s a home run, the trifecta.

 

Rod Khleif:               Any way you shake it. Yeah, so…

 

Jack Bosch:             Perfect.

 

Rod Khleif:               Let me ask you guys this, what books have you gifted the most to either students or friends? What books that you enjoy, have you gifted?

 

Jack Bosch:             I recently gifted The Go-Giver.

 

Rod Khleif:               The Go-Giver, okay. I haven’t heard that.

 

Jack Bosch:             Yeah. I think it was The Go-Giver. It’s a little red book. I believe it’s called The Go-Giver. I’ve gifted that like 25 times or so. Obviously, Rich Dad, Poor Dad…

 

Rod Khleif:               Sure.

 

Jack Bosch:             Everyone in our company reads that book. I’m reading a great book about leadership, right now. That’s actually called, I haven’t gifted it but I’m really loving it. It’s called Turning The Ship Around by lieutenant, by David Marquet, is the name.

 

Rod Khleif:               Okay.

 

Jack Bosch:             Turn The Ship Around. It’s a great leadership; it’s about leaders to leaders versus leaders followers. Leaders to leaders, that’s a concept I use in our company a lot, that allows us to go travel around the world all the time, while our team runs the ship. Because they’re leaders, they’re not followers of mine.

 

It’s a great book that helps see how operations of companies work a little different.

 

Rod Khleif:               Oh, thank you. I’m gonna check that out. I appreciate that. This is more for me than my listeners. Honestly… No, I’m kidding.

 

[laughter]

 

Rod Khleif:               That’s as much from my listeners, but I get some graded, great books from that question.

 

Jack Bosch:             How about you Corey?

 

Rod Khleif:               Yeah.

 

Corey Peterson:     For me, Richest Man In Babylon is always one of my favorites.

 

Rod Khleif:               Oh, yeah.

 

Corey Peterson:     I just love “10% of what I make is mine to keep.” I feel like we don’t save enough as a country…. And quite honestly, the Bible.

 

Rod Khleif:               Okay.

 

Corey Peterson:     I gift the Bible a lot.

 

Rod Khleif:               Awesome.

 

Corey Peterson:     That’s just a different level, but yeah, those… Books like that. If you’re not… Readers Are Leaders, we all know this. We hear this. You got to be feeding your mind. I’ve always said, I’m a student and then I’m a teacher as well.” Right? I teach what I know, and then I’m always a student. Till this day, I still buy courses. I still educate myself continuously because it’s enjoyable for me to do that. I like to learn new stuff but also, I just know that it’s something I got to do. I have to keep learning.

 

Rod Khleif:               Or listen, learners are earners. Jack and I met through this very high-dollar Mastermind that he and I are both part of.  Paying tens of thousands of dollars a year to be in those masterminds. I’m in several of them that I pay $25,000 a year a piece for, and you’re right, they’re very valuable.

 

Well, listen guys, I really appreciate you being on the show. You’ve added a ton of value. Those of you wanna reach these guys, again…

 

Corey Peterson:     Kahunapropertypartners.com.

 

Rod Khleif:               That’s it. That’s it. That’s how you can get a hold of them. Thank you so much for being on the show, guys.

 

Jack Bosch:             Thank you for having us.

 

Rod Khleif:               Okay.

 

Corey Peterson:     Hey, thank you so much, Rod.

 

Rod Khleif:               Alright.

 

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Thank you for listening to the Lifetime CashFlow Through Real Estate Investing Podcast. If you’ve enjoyed the show, please subscribe, and then take a moment to visit iTunes and leave a five star rating and review. For more resources to connect with us further, please visit our website at lifetimecashflowpodcast.com. Tune in next week for our next show.

 

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