Ep #191 – Joseph Gozlan Owns 150+ Multifamily Units Discusses Acquisition, Increasing Property Value and Rents

Here’s Some Of What You Will Learn

  • The benefits of building relationships with brokers.
  • The benefits of multi-family over single-family.
  • The importance of focusing on relationships with sellers, especially if they are older.
  • The benefits of seller financing and how building a relationship can help.
  • The importance of making your property a great place to live to attract tenants.
  • Ways of increasing value of your property through increased rents and increased Net operating income.
  • Ways to get started in order to be taken seriously and land more deals.
  • The benefits of using property managers as a deal source.
  • The benefits of self-managing and when it may be a good idea to do so.
  • The difference between a 506b and 506c capital raising and the benefits of each.
  • The importance of educating yourself and others that may be involved in your deals.
  • The benefits of using a property management company as the experienced party to secure financing.
  • The benefits of growing with smaller brokers over time.
  • The importance of proper due diligence and how property managers can be useful in the process.
  • Creative ways to document your property inspection to be able to carefully examine the property.
  • How to overcome issues and problems that may arise on the property.
  • The benefits of treating your residents right to maintain occupancy and promote your property.
  • The importance of not allowing fear to prevent you from taking action.
  • The importance of exit strategies and contingency plans for potential problems.
  • About some books that may help you get started and focused on your goals.

Our Guest

You can learn more about Joseph Gozlan here.

 

Watch on YouTube!

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 #191 – Joseph Gozlan Owns 150+ Multifamily Units…

Rod Khleif: Welcome to another edition of How to Build Lifetime Cash Flow Through Real Estate Investing. I’m Rod Khleif and I am thrilled you’re here. I know you are gonna enjoy the gentleman we’re interviewing today. His name is Joseph Gozlan and Joseph has… I can’t even count these. I don’t know how may units it is, but quite a few.

He’s taking action. He and I actually spoke… Gosh, it seems like a lifetime ago but it’s only probably been about a year and a half ago when he was just getting rolling and he’s already into the hundreds of units. Really making things happen, and we’re lucky to have him on the show. Joe, welcome. Welcome.

Joseph Gozlan: Thank you, Rod. It’s an honor to be on your podcast.

Rod Khleif: Oh, thank you.

Joseph Gozlan: I’ve been a time listener.

Rod Khleif: Oh, thank you. That’s awesome… Yeah, so let’s do the traditional, “Tell us how you got started story.” I know you’ve started in single family, so start there and then let’s talk about, let’s move in to that first unit, and your mindset about getting into this space.

Joseph Gozlan: Yeah. I was born and raised in Israel. When my then fiancé and I got married, we decided to buy an apartment and we bought one but it was kinda too large for us. We were just renting a one-bedroom kinda apartment on our own and that fell in line with the same timeline that we read, Rich Dad, Poor Dad.

We said, “Okay, maybe just for a couple of years before we move in, we’ll rent it out. So we became accidental landlords. And well then, you’ll start seeing the income stream, and it all falls in line. So we said, “Okay, then we list it.” Then it has real merit behind it.

Life happened and we kinda moved to the United States in 2007, recognized that the 07-08, the big crash, was probably the best opportunity market we were ever gonna see in our lifetime. So we sold the apartment back home and we started buying single-families in the States. That’s how we got started.

Rod Khleif: Where were you located at that time?

Joseph Gozlan: Plano, Texas.

Rod Khleif: Okay.

Joseph Gozlan: That’s where we came over.

Rod Khleif: Okay. Okay.

Joseph Gozlan: That was really a fantastic time to buy here in Plano.

Rod Khleif: Oh, yeah. For sure, it was pretty much a fantastic time to buy anywhere. Of course, I was licking my wounds and hiding under a rock ‘cause I was getting my butt kicked in that time frame. But there were incredible opportunities.

In fact, some of the most successful syndicators that I’ve interviewed on the show started in 09 and 10, so fantastic. When did you buy that first 22-unit? I know that was number one, right? That was the first one?

Joseph Gozlan: That is correct. I started my journey back in 2015, getting into multi-family. The trigger was realizing that single-single family was just not scalable enough for me. Right?

That year, I had to write about $45,000 worth of expenses, on a property. I was lucky I had reserves. I was prepared for that. But I realized, that if every one of my singles is gonna have that much expenses, I’m gonna be in big trouble.

Rod Khleif: Right.

Joseph Gozlan: So I researched what’s better? What’s more scalable? And what is safer?

Rod Khleif: Safer.

Joseph Gozlan: And multi-family is really where I landed because it’s… You get to spread your risk across a lot more units. That’s where I started my journey. It’s not an easy industry to get your self into. It’s hard to get your foot through the door so there was a lot of building relationships with brokers, and reaching out.

At my frustration point, I said, “You know what, the hell with it. I’m gonna source the deal myself.” So I started doing marketing, and postcards, and cold calls until I found, in 2016, a good seller that was willing to come in at a reasonable price and worked a good deal with us.

Rod Khleif: Awesome.

Joseph Gozlan: That 2016 was our first one.

Rod Khleif: No kidding. Well, let’s dissect that deal, do you mind?… So you found that by direct to seller. Awesome. That was a fantastic way to do it.

Tell us about the deal itself. Unit-mix? Pricing? How you put it together? How you put together the capital stack? Let’s just dissect that one.

Joseph Gozlan: Sure. So we agreed on a sale price of 1.6.

Rod Khleif: Okay.

Joseph Gozlan: The 22-unit, I didn’t look for a Class A building but I kinda happen to land on one. This is a 2007 built, granite countertops, really, really nice property.

The gentleman that was selling it was an 80 year old. He built the property by himself. He used to be a custom homebuilder for decades. So everything is really built at a very high spec, and very nicely done.

He was kinda self-managing it, fixing stuff on his own, having a realtor help him lease up. Very lenient with the way that he operated things with the residents. But at 80, he was kinda ready to move on from that.

I remember, I had a conversation with you, before I went to the meeting face to face with him.

Rod Khleif: Right. I do remember [chuckle]

Joseph Gozlan: You kinda helped me, basically, tweak my message, just the right things to say, the right way to build rapport with that person, because it’s a relationship business. If you don’t build a relationship, nothing is gonna work.

For that I am grateful to you…

Rod Khleif: Oh, my pleasure, buddy. And let me interject something. Guys, whenever you are dealing with an elderly seller, 80 or above, focus more on the relationship than the actual, than the deal. Build rapport, develop a relationship because seller bonding is so important and so valuable.

People, as they’re growing older, they value relationship more. They realize that life is about relationship and they’re a little more evolved just because of their age and you wanna take advantage of that. Not to take advantage of them but to create a win-win deal.

That’s likely. I don’t remember the specifics of how I added value to you back then but that’s likely what I said, was to focus on the relationship because it really does make a huge difference.

Please continue. So 1.6 million, that’s a good price. I mean, that’s a high price for a 22 but that’s because it’s an A building. I mean, granite countertop.

Joseph Gozlan: Exactly.

Rod Khleif: Holy cow. How did you finance it?

Joseph Gozlan: Seller financing. The down payment…

Rod Khleif: Oh, that’s right! I do remember. I do remember you talking to me about that. That’s right. Okay. Fantastic. That’s awesome. Seller financing…[chuckles]

Joseph Gozlan: Yeah.

Rod Khleif: Can’t get better than that, guys. Seller financing is the belle of the ball, whenever you can do it. Awesome.

Joseph Gozlan: Absolutely. Actually, we’ve done another one of those since then.

Rod Khleif: No kidding.

Joseph Gozlan: On this one, because of the relationship, because I didn’t wanna bring another partner, I had some money that I’ve gotten from refinancing the properties I bought back in 09. I’d said 2006 was a great year… 2016 was a great year to refinance it.

Rod Khleif: Sure.

Joseph Gozlan: And then we pulled the equity out, we used that one as the down payment with the seller. And all we had to do, coming in, is really shine as operators. Because the property did not need rehab, there is no major capex expenses; very small things. But when you come in and you turn this into a community.

We are big believers in karma. We wanna build a great place for our residents to live in. we wanna make sure that they wanna bring in their friends. They wanna bring in their family, to live in the property with them. So we’ve actually built a waiting list.

We were able to bump rents way beyond what he was getting. We always like to use carrot over a stick when we try to encourage our residents to do things. He would let them pay on the 15th, on the 20th. When we came in, we want things done, get paid as soon as possible. Instead of coming in as the new sheriff in town, “If you don’t pay me on time you’re gonna get evicted.”

We said, “Okay, anyone that pays on time for the first month is gonna get in the raffle for a big TV.” We raffled an LED TV. It was like, I don’t know, $200 for us but 80% of the property paid on the first.

Rod Khleif: No kidding. That’s brilliant.

Joseph Gozlan: Yeah. So what we love about this property is the location was awesome and then a year later, refinanced, and we got appraised at 2.1.

Rod Khleif: No kidding. Look at that, 500 grand, just like that, just by increasing the rents and improving the NOI. Improving the net operating income, you got a $500,000 increase in value. Fantastic. Fantastic, buddy.

What was property number two? How many units?

Joseph Gozlan: So property number two, was 102. That was our first syndication.

Rod Khleif: Okay.

Joseph Gozlan: That one was definitely an experience.

Rod Khleif: Yeah.

Joseph Gozlan: It’s a lot different buying for yourself.

Rod Khleif: Just as long as it wasn’t a seminar. Hopefully it wasn’t too many… I’m sure there were some little mini seminars in there, but hopefully no big ones.

Joseph Gozlan: No, there was no big ones.

Rod Khleif: How’d you find it and … tell us about it.

Joseph Gozlan: Like I said earlier, it’s an industry that’s hard to get into. It’s a catch-22 because until you start buying, nobody wants to give you anything to buy. But once we closed on our first one, then brokers started to realize, “Okay, you’re a closer. You’re not just a tire kicker.”

I started getting some deals a little bit earlier into the process, before they go into the market. Then our property management actually, a third party partner that we have, saw a broker walk around a property nearby the property they were managing, and they knew that broker so they kinda reached out. Said, “Hey, what’s going on?”

He said, “Well, the sellers are thinking of selling”. They told him, “You know what, we’ve got the perfect buyer for you.”

[00:10:01]

Joseph Gozlan: And they got us connected with them.

Rod Khleif: Fantastic. Fantastic. Guys, property managers can be a great source of deals. It happens all the time. I hear it time in and time out. So those relationships are valuable. And let me publicly say it once again; I have so many of you that I talk to, on strategy calls. You think that I’m a big proponent for self-management, which I am with a caveat.

That caveat is after you’ve stopped buying; when you’re out of acquisition mode, then get third-party management. I mean, I’m sorry, then consider managing yourself, when you have enough of an infrastructure where you can pay somebody the same amount of money you’re paying a third-party manager then you consider taking it in-house, ‘cause chances are, you can do as good or better job than they do.

But when you’re in acquisition mode, absolutely, don’t manage. And if you’re brand new, don’t manage. You need to learn the business, learn the nuances. Frankly, and this is a great example of another reason why you don’t self-manage, you got this deal because of your property manager, that you wouldn’t have gotten otherwise. Right?

Joseph Gozlan: True. Absolutely. And I look at out property management company as Olympic athletes. All these Olympic athletes have a coach. Can that coach be faster, throw higher and faster, longer. Right? No, but what a coach brings in is accountability, is big picture view. It’s those little tweaks here and there that helps that athlete go three to 5% more. That’s how they get the goal. Right?

Rod Khleif: That’s a great analogy.

Joseph Gozlan: So that’s what we do with our property management. We work with them. We catch the balls that they might drop, because they’re human. We hold accountability. We keep track of things and we give them the 50,000-foot view that they might lack from where they are.

Rod Khleif: Okay.

Joseph Gozlan: That’s how we get that operation excellency.

Rod Khleif: So this 102-unit was your first syndication, tell us how that came together? What did you do to go find investors? How did you position yourself? How did you put yourself out there with authority? Give us a little bit of background there.

Joseph Gozlan: Yeah. For me, doing the first one, I did it all by myself. I didn’t have any partners I went and had it… Sometimes, ignorance is bliss. I figured, I can do everything.

The underwriting and finding the deal, and all these went well. We had got to the equity raise and stuff. I’ve built an offering memorandum that I’ve evolved a lot during this process. When we went to investors, we went to friends and family.

Rod Khleif: Okay.

Joseph Gozlan: There is the… I know you talked about that in the show before. There’s 506 B and there’s 506 C.

Rod Khleif: Correct.

Joseph Gozlan: It’s always hard for me to remember what it is…

Rod Khleif: 506 C is accredited only.

Joseph Gozlan: Yes.

Rod Khleif: So which did you do?

Joseph Gozlan: We did a 506 B for our first one?

Rod Khleif: B. No, you took anybody really. It’s pretty much anybody’s but I mean, you wanna do sophisticated. You don’t really wanna do people that have never done anything before because they require so much hand-holding. But you can in a 506 B.

You went to friends and family. How did that go?

Joseph Gozlan: A lot harder than I thought it would be.

Rod Khleif: Tell us why.

Joseph Gozlan: First of all, there’s a lot of education that has to happen. Even when a person is an accredited investor or a sophisticated investor, they might be doing great in stocks, or in options, or in any other things but multi-family is a different thing that they have never seen.

Even people that invest in single-family properties, has a challenge transitioning and understanding the structures of multi-family.

Rod Khleif: Sure.

Joseph Gozlan: There was a lot of educating and sometimes, multiple conversations with the same people to just get them used to the idea of what is multi-family. How we structure a deal? Why me that I only have a 22, can handle a 102-unit. This is where I leaned heavily on my property management experience and their reputation and how they are a huge advantage for us.

Rod Khleif: That’s smart. You just supplemented that lack of experience with the other member of your team, which is your property management company in this case. Guys, you can do that with a management company, you can do that obviously with a sponsor that owns units. But let me ask you this, so I don’t forget, did you go Freddie Mac on this deal and utilize the property manager as the experience piece? Or were you able to go some other way?

Joseph Gozlan: We did Fannie Mae…

Rod Khleif: You did Fannie Mae…

Joseph Gozlan:And yes we used our property management.

Rod Khleif: Okay. So they allowed… Fannie Mae, it’s usually easier with Freddie Mac if you’re using a third-party manager as the ‘experienced component’ but it’s great you were able to pull it off with Fannie Mae. Fantastic.

Joseph Gozlan: Well, I wasn’t the only KP. We actually got the owner of the property management to come in as a KP with us. She was actually an investor in the deal. It was that good of a transaction. So that’s how we… [overlap talk]

Rod Khleif: Okay. Well there you go. There you go. That explains it. I was a little puzzled how you were able to pull that off. But that explains it; you brought the property manager, and brilliant. I mean, brilliant. Give them a piece and the deal is done. It’s just as if we’re bringing a sponsor in. It’s the same thing, really. Fantastic.

Joseph Gozlan: Plus, we get them with even higher stakes in the game, making sure the property’s operated to the best efficiency.

Rod Khleif: Sure. They have a dog in the hunt. Yeah. They have a dog in the hunt. They’ve got to make sure its well taken care of. Yeah, absolutely. No. It’s a great strategy and it’s very effective. And it’s not an uncommon strategy. Well, good for you. Awesome. Awesome. Awesome.

So you raised that money from friends and family, and I know your next deal was a 28-unit, is that correct?

Joseph Gozlan: Yes, that’s correct.

Rod Khleif: Another syndication?

Joseph Gozlan: No. That one, again, I took all by myself.

Rod Khleif: Okay.

Joseph Gozlan: But only because we got the seller to agree to seller financing again, and he let is in at a very low down payment.

Rod Khleif: How did you find those deals? Did you do outbound calls? Did you do mailing? Did you send postcards, letters? Tell us some strategies that you used.

Joseph Gozlan: That one was actually through a broker relationship.

Rod Khleif: Oh, it was. Okay, so that was a broker deal. Okay. Okay. I don’t know, sometimes it’s hard to do seller financed deals with brokers because obviously they’ve got to get a commission and whatnot. A lot of times, there’s some resistance with the broker arena when you’re trying to propose a seller-financed deal.

They look at you like sometimes that… They may have a preconceived idea that you’re a novice because you propose seller financing or maybe you can’t get regular financing or whatever. I know that as a broker, you’ll sometimes get that resistance but obviously you didn’t, so fantastic. You were able to do it via a broker deal.

Joseph Gozlan: Yeah. We like building relationships with brokers that are smaller boutique shop and not like the big monsters like A.R.N., Newmarket, Marcus & Millichap, and all these guys. Because the smaller boutique shop will work with you a lot more, and they will build that relationship with you, and they’ll be able to testify on your behalf when they are talking to a seller, for versus another guy from Marcus & Millichap, for you, you’re one of his 300,000 people on the mailing list.

Rod Khleif: A very, very good tip guys. Those of you that are listening, that is a great tip. Especially in this hot market, as you’re getting going, align yourself with the small boutique like that and grow together. Grow with somebody like that.

These are lifelong relationships you’re building. You’re not gonna get into this multi-family business for a quick hit and get rich quick. It’s not a get-rich-quick business. It’s a become-extremely-wealthy-over-time business. It happens through deep, frankly lifelong relationships with brokers like you’re describing here. They become your advocates. Awesome.

Joseph Gozlan: Yeah. I couldn’t agree more.

Rod Khleif: Awesome. Awesome. Alright, so the latest was a 97-unit, tell us about that one.

Joseph Gozlan: That one, we haven’t closed yet.

Rod Khleif: Okay.

Joseph Gozlan: We just got around the contract a couple of weeks ago. We finished inspection last week. It’s a fantastic property. We jumped on it, as soon as we could. I think the broker reached out to me with, “I heard they’re gonna put on the market”, and two hours later, we had it under LOI.

Rod Khleif: No kidding.

Joseph Gozlan: Yeah. We move fast.

Rod Khleif: Fantastic. How fast… I mean, did your money go hard quickly? Did you do anything to set yourself apart? Was there anything you did, as a strategy, to make sure you didn’t get usurped out of that deal?

Joseph Gozlan: Yeah. The real strong value that we brought into this deal is that, it was right across the street from the 102 units we bought.

Rod Khleif: Perfect. Okay.

Joseph Gozlan: We’re in the corner, we know all the numbers, we know everything we need to know so that’s why we were able to pull the trigger so fast because underwriting it was easy.

Rod Khleif: Sure.

Joseph Gozlan: We were there. We know exactly what’s possible.

Rod Khleif: Yeah. You didn’t have to do any market analysis for rents and beat yourself to death calling other properties, and trying to make sure you’re comparing apples to apples. I mean, you knew. You’re right there. That’s fantastic.

Joseph Gozlan: Exactly.

Rod Khleif: That’s a homerun.

Joseph Gozlan: Yeah.

Rod Khleif: That’s a homerun on a whole bunch of different levels because you could actually put those two together if you wanted too at some point, if they’re literally across the street from you.

Joseph Gozlan: Yeah. We have multiple strategies around that. What’s the really good part is that it brings us economy of scale…

[00:20:00]

Joseph Gozlan: To the point where we can save money on better operation efficiency.

Rod Khleif: No question.

Joseph Gozlan: Right.

Rod Khleif: Same maintenance staff. Same leasing staff. Same everything. I mean, it’s fantastic, that it’s almost like you acquired a company in this regard. You pool and you have economies. That’s fantastic.

Tell my listeners how you go about your due diligence. What are you gonna do on the due diligence on this new acquisition? Tell us your process for that. How that’s come about?

Joseph Gozlan: Yeah. This is, again, where partnering with a property management company really pays off.

Rod Khleif: Okay.

Joseph Gozlan: When we go into due diligence, we bring multiple people from the property management company. We bring some outside contractors. For example, we will always bring a plumber that will run cameras underneath the building into the sewer lines.

This is not part of my property management company, it’s a third-party vendor but we will always do that because when you deal with C class properties there’s always problems with the plumbing. You just need to know what you’re getting into.

Rod Khleif: Absolutely.

Joseph Gozlan: So that’s something we do. We walk on every roof, we put ourselves into every door, every shop, every nook and cranny in the property. We usually take two or three teams of our other managers or regional managers or maintenance people from the other properties, bring them in for a couple of days and we walk every unit. No matter what the size of the property is, we walk every unit.

What I did is, I went on Amazon and I bought three or four small point-and-shoot cameras but I bought 10 extra batteries, about 10 extra memory cards and I just hand it over to the teams and I told them I want as many pictures as you can get…

Rod Khleif: Of every unit and catalogued, so when you wanna know what unit 302 looks like. All you have to do is go in your Dropbox and pull the pictures and you know exactly what the interior of that unit looks like.

Joseph Gozlan: Yes.

Rod Khleif: Love it. That’s a brilliant strategy.

Joseph Gozlan: The first picture is of the unit number and then we walk in and then [overlap talk]

Rod Khleif: The address. That’s the way to do it. Yep, that’s the way to do it. That’s the way we do it as well. Take a picture of the address, of the unit number, and then the rest of the pictures you know are for that unit. Love it.

Joseph Gozlan: Yeah. We have a very thorough form that they fill. That at the end of the inspection we aggregate all that and I can tell you at the level of the light switch, how many those we need to repair and how many of those we need to fix, and what’s the grade of every piece of appliances we have out there, whether they have leaks or not. Everything is on that form, and I use my virtual assistant to kinda take all those scanned form and put them into Excel.

Rod Khleif: Right.

Joseph Gozlan: We know exactly where we’re going into when we’re done with the inspection period.

Rod Khleif: Now, I love it. Love it. That’s the level of detail you need guys, because you may not get into that unit again for years. I mean, this is an opportunity you must take advantage of, at least to that level of detail. You’ve got a big team there, and obviously, you’re gonna inspect units as you can, and as regularly as you can, but that level of detail, typically, the best time to do that is when you’re going through due diligence and you’ve got big teams there, doing it.

Have you had any early failures that have contributed to your success?

Joseph Gozlan: I don’t know if I would call it failures, but definitely red flag moments.

Rod Khleif: Okay.

Joseph Gozlan: I mentioned earlier, paying $45,000 on a single property, in about a period of I don’t know, four months or something like that. And that really was a red flag for me to say, “Okay, go multi-family.”

In the multi-family world, I haven’t had the chance to experience any failures yet.

Rod Khleif: Good.

Joseph Gozlan: Snags, yeah, definitely. Surprises, we had a small fire on one of the properties, three or four units down.

Rod Khleif: Wow.

Joseph Gozlan: But because we have an experienced property management company, we know how to handle this. We knew how to work with the insurance company. We took care of the residents, first thing, right? We gave them new apartments wherever we could and we work with them because at the end of the day, I am a big believer in karma.

Rod Khleif: Me too.

Joseph Gozlan: Karma. Now, I keep saying karma is good for business as well. You take care of your residents, and it’s in our organizational culture, to the point of, you haven’t heard me say, tenants. We address them as residents. You don’t hear me say…

Rod Khleif: No, that’s a critical distinction. That’s a critical distinction.

Joseph Gozlan: We don’t say complexes, we say communities.

Rod Khleif: I love it.

Joseph Gozlan: Because that’s what we wanna do. The 102 units we bought, it was pitch-black at night because all the exterior lights were out. We’re doing due diligence, it’s in the middle of the day and I see a nurse go out. You know a nurse going out at noon that means she’s coming back around midnight or 1:00 am. How do you think she feels coming into a pitch-black property?

Rod Khleif: Right.

Joseph Gozlan: Right. It’s not they don’t feel safe, they can fall and all that.

Rod Khleif: Sure. No question. You should be looking at your sight lines in the property. Can you see through? Can the police see through? And the lighting, yeah, so did you correct that? I’m assuming you did.

Joseph Gozlan: The first day, when we took over, there was already an electrician on-site, putting brand new LED lights all over.

Rod Khleif: Love it. Love it.

Joseph Gozlan: Going back to why karma is good for business, do you think a nurse that leaves like that and comes back into a pitch-black property is walking around the hospital saying, “Hey, look, come live in my community”? No, she says to her friends, “Stay away from here.”

Rod Khleif: Right.

Joseph Gozlan: Now, when we do community events, and we take care of our residents, they can walk around proudly to say, “Hey, they’re awesome over here. Come live with us.”

Rod Khleif: Right. Right. Right. Love it. No, listen, anytime you, you can call it karma, karma is a great way to call it. I call it adding value. Anytime you add value, it always comes back to you. Anytime you give it always comes back to you. In any way, shape or form, of yourself, of money, of adding value to somebody’s life, it comes back tenfold. It’s the way of the universe, or God, or whatever it is you believe in. It’s just the way the universe works.

What do you think is your super power as it relates to multi-family investing? What are you best at?

Joseph Gozlan: Yeah. My mind is wired 80,000 miles an hour of what could go wrong. My superpower is not letting this stop me from taking action. It’s that I use that mindset to build plan B, and C, and D, and E, and F, and so on. To the point where I know that when I pull the trigger on a property, I am ready.

I am prepared. I have contingency plans. And I know how we’re gonna handle whatever life throws at us, because life with throw things at you. That’s just life.

Rod Khleif: That’s just how it works. If you don’t have problems, you’re typically six feet under ground. Everybody has issues and things that come up… No, I love that, and that should resonate with those of you that are super analytical that get caught up in analysis.

Taking action, you have to push past it. You have to push past fearing what could go wrong and try to focus on what could go right. Look at the positives and try to think of what could go right and not just what could go wrong and take action.

But of course, like you said, Joseph, you’re gonna look at every possible contingency and look for ways and come up with different scenarios, and exit plans, and strategies to handle anything that might pop-up. Because of that, that helps ensure your success, because no matter what happens, you’ve thought about it, prepared for it, planned for it, and likely trained your team to handle it.

Joseph Gozlan: Yep.

Rod Khleif: That’s what makes a successful business owner and anybody in this multi-family space, that’s what you become as a business owner.

What books do you like to gift to people in this business, the most? Are there any books that you gift to others?

Joseph Gozlan: Yeah. It really depends on where they are in their journey. If they are at the beginning, I like to give, The One Thing by Gary Keller.

Rod Khleif: Gary Keller. Awesome book.

Joseph Gozlan: That really helps people focus on how to get to their goals. If they have already gotten into the point where they’re looking at properties and things like that, I always send them your book to look at…

Rod Khleif: [chuckles] I was not expecting that. Thank you, brother. Thank you.

Joseph Gozlan: It’s more about, they have questions in this and that, and it’s all in your book. There’s no fluff, there’s a ton of good content that helps people understand a lot of the aspects of what we do, if not all of it. So I send them to your book.

Rod Khleif: Thank you, brother. I appreciate that.

Joseph Gozlan: Yeah, and when they’re a little bit further down the road, then I have two books. One is The 80/20 Rule by Perry Marshall, which really goes back to the conversation about property management. It’s where is the best use of my time. And you said it; if you’re in acquisition mode, focus on acquisition ‘cause it’s a better use of your time than managing a property.

Rod Khleif: Right.

Joseph Gozlan: So The 80/20 Rule really helps focus…

Rod Khleif: That the Pareto Principle. And I mean, there’s always 20% that will get you 80% of the traction. It’s typically the 20% that you don’t wanna do but that’s the 20% that’ll… In fact, I jus had a conversation with my coaching clients, last night, about this very topic.

[00:30:04]

Rod Khleif: The exact same conversation, and it was about productivity. I do a high performance coaching and it was about productivity. If you wanna be productive, do the hard stuff first. Do that 20% first. Then the rest of the day, you’re coasting and you’re much, much more productive.

So, anyway, was there another book that you were gonna mention?

Joseph Gozlan: Yeah, there is one more book. And it’s kinda like it’s not very famous, it’s called, Profit First by Mike Michalowicz. It’s good for any business owner out there, not just multi-family.

It’s about, how do you think of your business in the way of income streams and how do you put aside money for taxes first, and then you take care of your profit, and in our case our investors’ profits, and then you drill down to the operations. So that’s a really good book to help understand things like that.

Rod Khleif: Is the basic premise pay yourself before you let it get sucked in to the business? That’s a great premise. You have to make sure that you take care of yourself. Otherwise, you’re just working and churning.

Joseph Gozlan: Yeah. Well in our case, it’s also make sure you take care of your investors. [overlap talk]

Rod Khleif: Oh, sure. Of course. Of course.

Joseph Gozlan: And actually, well, it kinda transitions well to what we do.

Rod Khleif: Okay. I’m gonna definitely get it. I’ve never heard about that one before. Awesome… Well guys, those of you listening, if you are not part of our Facebook group, you need to get on there. There’s 4700 people on there as of today, I think. That’s after, I think, less than three months. And there are groups forming all over the country.

When I was in LA, scouting out the location for my live event, I met with five guys that met on that group and they now have a meet-up with 45 people. This is happening all over the country. You really need to get on there. All you have to do is go to MultifamilyCommunity.com, it’s a direct link to that Facebook group.

There are a lot of hitters on there as well.  Are you on there Joseph?

Joseph Gozlan: Absolutely.

Rod Khleif: Okay. Well there you go. There you go guys. Joseph’s on here himself, so there you go… Well, listen, my friend, it’s been a real treat and thank you for being on my show. You’ve added a ton of value and we’re just gonna…

I’m really excited to see where you are 24 months from now. We’ll probably have you back on and I imagine that inventory will be double what it is now. Thanks again for being on the show, Joseph.

Joseph Gozlan: Thank you for having me. It’s been a pleasure.

Rod Khleif: Absolutely.

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Thank you for listening to the Lifetime Cash Flow 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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