Tim is a seasoned Florida real estate broker, licensed building contractor, investor, and Amazon Best Selling Author with over 40 years of experience. He owns and operates a successful Florida Real Estate Brokerage managing 500+ rental units, a private lending company, and holds a personal rental portfolio of 60+ doors. Tim, alongside his wife Sandi, enjoys traveling in their motorhome and spoiling their grandchildren. Committed to giving back, Tim is a long-time member and past president of the Lakeland Sunrise Rotary Club, past president of the Polk County Builders Association, and actively contributes to The Love, a 501C3 providing wheelchairs globally.
Here’s some of the topics we covered:
- Tim’s Background In Construction
- The Transition from Construction To Multifamily
- Networking Is The Key Piece To Multifamily
- Current Deals Tim Is Apart Of
- What You Can Bring To A Multifamily Team
- The Process Tim Uses For Finding Deals
- What Happens When You Can’t Find Info On A Property
- Getting Aligned With Residential Brokers
If you’d like to apply to the warrior program and do deals with other rockstars in this business: Text crush to 72345 and we’ll be speaking soon.
For more about Rod and his real estate investing journey go to www.rodkhleif.com
Full Transcript Below
00:00:04:06 – 00:00:29:02
Intro
So you know, that apartment building or complex, you drive by every day, someone owns it, and it’s probably someone on this podcast. Multifamily Rockstars. During the growing numbers of real estate entrepreneurs who have made the jump to buying multifamily properties for lifetime cash flow, multi family rock stars using OPM for an OMG ROI. Now here are your hosts, Brian Cleave and Mark Nathan.
00:00:29:04 – 00:00:54:11
Rod
Welcome back to the new version of multifamily rock stars. And maybe you haven’t heard, but because of feedback, because we’re always asking for feedback from you guys and the fact that we’re always trying to make things better, you know, constant and never ending improvement, we’ve decided to make these episodes more deep dives into our guests deals and really give you more practical and actionable items for you to get started and to actually for yourself to do your own first deal, especially if you’re new to multifamily.
00:00:54:15 – 00:00:57:15
Rod
Now, of course, I’ve got my co-host, Mark Nagy, here with me.
00:00:57:17 – 00:01:07:12
Mark
What’s going on? I don’t know about you, but have been super busy with so many price reductions on deals lately. My whole inbox is filled with them brokers lately, so things are going the wrong way.
00:01:07:14 – 00:01:28:15
Rod
Now we’ve got it. We’ve got a deal under contract in San Antonio. That’s just an absolute screaming deal. In fact, on that note, let me just say this. If you’re accredited. Text the word partner to seven two, three, four, five to check it out. I mean, it’s it’s extraordinary. The one next door sold for 137,000 a door. And we’re getting this one for 100 CEST an unbelievable deal.
00:01:28:15 – 00:01:51:24
Rod
Deals are starting to come. Well, listen, we’ve got a great interview for you today. He’s actually a best selling author. His name is Tim Davis and he’s a real estate broker. He’s a licensed GC building contractor, real estate investor, and he owns and operates his own real estate brokerage and property management company. He’s got you know, he’s in quite a few doors as a limited partner, almost 700 as limited partner.
00:01:51:24 – 00:02:08:13
Rod
He’s got his 60 doors himself that he owns himself and and he’s done his syndicate open on a mobile home park, which we haven’t talked about before here, which is which is unusual. Not unusual, but unusual to be on this show. So his name is Tim Davis. And welcome, brother. Good to see you.
00:02:08:19 – 00:02:09:23
Tim
Thanks, Rod.
00:02:10:00 – 00:02:23:22
Rod
Glad you’re here. Glad you’re here. So why don’t you take a few minutes and just kind of give us some background on you? You know why? Real estate and, you know, kind of kind of bring us from a little bit about your past and bring us current.
00:02:24:02 – 00:02:47:18
Tim
Sure. Yeah. So I kind of fell into real estate when I was really young. I was 18 when I bought my first rental property and it was kind of an accident. Accidental landlord back then. But it really intrigued me because I was 18 years old, married with a couple of kids, and and we were.
00:02:47:20 – 00:02:56:22
Rod
A Wait a minute. Wait a minute, wait a minute, wait a minute, wait a minute, wait a minute. Did you say 18 and married with a couple of kids? Holy cow. You didn’t waste any time, brother.
00:02:56:24 – 00:03:22:06
Tim
I got married young, but, yeah, I dropped out of high school, got married, and we were struggling. And I was able to buy my first rental property. And I actually bought it from my dad, who was an assembly God minister. He. He tried to get into real estate, but he he just didn’t make it. So he sold me my first rental property, which was pretty cool.
00:03:22:06 – 00:03:39:22
Tim
And I loved the experience of getting cash flow from it. And so I started working on learning more and more about it as I went on. And so I’ve been doing this for quite a long time, 40, 40 to 43 years now. Wow.
00:03:39:24 – 00:03:42:07
Rod
And wow.
00:03:42:09 – 00:04:20:22
Tim
It’s been great experience. And I really enjoyed my real estate journey. I’ve worked through construction and I did a lot of construction in my early days and then worked worked into actually getting my brokerage license probably 15 years ago and started a property management company. And we managed about 500 rental properties in Central Florida. And I started buying up a lot of rental property myself in the right after the crash of 2008, 2009.
00:04:20:24 – 00:05:04:11
Tim
And and so I was able to kind of semi-retired about five years ago. And then I joined the Warrior program probably three, three years ago because I really wanted to learn about multifamily and really get into that. I had not been in that space in the past, and so that’s when I jumped in as an LP, several deals and and then we just did our very first syndication on our own with a small mobile home park, which I thought was kind of interesting because it would have been hard to finance that through a bank.
00:05:04:11 – 00:05:27:09
Tim
So we ended up getting 100% of the funds from our limited partners, and we’re giving them the preferred rate of return from day one. We started giving them their preferred rate of return just like we would have been paying a bank for for a loan. So we decided to send them the money instead. And it’s been a pretty good, pretty good deal.
00:05:27:09 – 00:05:31:20
Tim
Everybody’s enjoyed that. They’re really anxious to do the next deal with us.
00:05:31:23 – 00:05:35:12
Rod
So nice. Now, are you in Lakeland or where are you?
00:05:35:13 – 00:05:41:07
Tim
Yeah, yeah, I live in like, I’ve been in like, okay, 1976. So I’ve been here a long time now.
00:05:41:07 – 00:05:58:05
Rod
You said Central Florida. And I’m like, Yeah, that’s about as central as I could think of. Good guess. Okay, I didn’t know that. Or if I. If you told me, I’d forgotten. Forgive me, but forgot what I had for breakfast already. So. But so you started in 2009 and that’s good timing. Yeah. Good for you. You know, I was.
00:05:58:05 – 00:06:09:07
Rod
I was hiding under a rock then and. Yeah, so. So, you know, you’ve been in the Warrior program. Have you been to a warrior event where we do the networking, all that business?
00:06:09:09 – 00:06:12:09
Tim
Absolutely. I go to every single one that you have.
00:06:12:11 – 00:06:30:18
Rod
All right, All right. Well, the reason I’m asking is we just had an interview and and, you know, she talks about being overwhelmed there in the networking piece, you know, because I tell everybody, do you want your superpower go meet other people? That’s one of the biggest benefits. Would you agree of the of the of the events like that?
00:06:30:20 – 00:06:48:06
Rod
Now, guys, you can do this on your own. Go to meet up groups, go to, you know, get out there and meet people. But you’ve got to you know, in this business, you got to line with people that shore up your deficiencies and and and you know, you get you get these symbiotic relationships. Like the most common is somebody that’s analytical with someone that’s outgoing.
00:06:48:08 – 00:06:55:02
Rod
But you know what what is your experience been in the in the whole networking piece? Do you find that’s a skill set of yours?
00:06:55:04 – 00:07:25:11
Tim
Yeah, I love I love networking with the guys at the Warrior, especially lunch time and dinner time. Those are some of the best times because you get together with them and just start talking about deals, finding out what they like to do, you know, as as far as is my superpowers, I guess we call them. And in the Warrior program, you know, I’m I, I’m a I love the structured deals and I love to solve problems.
00:07:25:13 – 00:07:39:19
Tim
I am not the detail guy that’s going to crunch the numbers and you know but I’ll look over the numbers once there once they’re there. But I’m I’m not the guy that’s going to do all the underwriting. Same here. Probably the same way.
00:07:39:21 – 00:07:49:09
Rod
Same here. Oh, yeah, I know. I listen, you know, we just throw those guys in a rock in a room with a spreadsheet and throw raw meat in once in a while. Keep them happy right now.
00:07:49:09 – 00:08:08:17
Mark
Walk me through that process of figuring that out, because obviously you did a bunch of passive investing as an LP and then obviously, you know, you did the deal. What was the was the idea on the LP deals? Was that so that you could learn and kind of help figure out your actual power, or was it just getting rid of some cash that you had?
00:08:08:19 – 00:08:35:10
Tim
Well, yeah, no, it it was, you know, when I joined the program, I, you know, I wanted to get involved right away. And so I started talking to my coach and different people in the program and, and they, they suggested, you know, join LP deal. So I was kind of anxious to do one and I think I jumped into one that that was kind of not well thought out.
00:08:35:10 – 00:08:56:05
Tim
But you know interestingly enough it it ended up turning out real well I’m thinking about it. I’m getting actually they’re they’re giving us back our capital this month and we’re getting about a 22% return on our investment annual interest for 16 years. Yeah.
00:08:56:10 – 00:08:59:19
Rod
So I wouldn’t bitch about that too much. Yeah. No.
00:08:59:21 – 00:09:27:23
Tim
Not at all. But but it was kind of a it was kind of a weird deal. Wasn’t a warrior that did it at first. I think he did join the program after a while, but. But I was anxious to get into a deal and it was close by my home. It wasn’t too far away, so I jumped into it and had to help the guy along quite a bit because I do have a lot of it was a conversion motel through to multifamily conversion interest.
00:09:27:23 – 00:09:46:11
Tim
Oh wow. Had a lot of experience in construction, so I knew I knew what he was facing and so I helped him out a lot on that. Even as an LP, I didn’t have any, you know, I didn’t have any responsibilities as a GP, but I kind of helped him through some some issues and got him straightened out.
00:09:46:11 – 00:09:52:11
Mark
And you’re a good LP to have as a passive investor. I bet he’s he’s thankful that he brought you in on that deal that.
00:09:52:16 – 00:09:53:18
Tim
Yeah yeah.
00:09:53:18 – 00:10:15:15
Rod
You know, what types of listeners would be able to relate to you, do you think? Tim You know what? You know, we’ve got so many different personality styles that listen to this show. You know, we’ve got analytical people, we’ve got, you know, more outgoing people, we’ve got more process driven people, we’ve got business owners and, you know, everything in between.
00:10:15:15 – 00:10:16:09
Rod
So.
00:10:16:11 – 00:10:46:05
Tim
Yeah, I’m who do you is? I think people that can relate to me are probably people that have like entrepreneurs that have gone through this, the school of Hard knocks. You know, I meet a lot of guys at the Warrior program who are engineers. They got degrees and all this stuff. I don’t have that. I’ve just been in the school of hard knocks, I’ve been through it and, you know, and so that’s that’s the that’s the kind of guy, you know, or guy or girl.
00:10:46:07 – 00:10:54:06
Tim
It’s like, if I can do this, anybody can do it. You know, that kind of that kind of thing. That’s the way I look at it.
00:10:54:06 – 00:11:01:23
Mark
So out of curiosity, what what made you decide to even join a group like ours instead of continuing with the school of hard knocks in multifamily?
00:11:02:00 – 00:11:26:12
Tim
I’m one of those people that I love to, to continually educate myself. I’ve always been a self educator and and I know one thing that if I can jump into a program and I have a teacher or mentor, somebody that I can that I can follow behind, that I can do what they’ve done or, you know, something similar to it.
00:11:26:12 – 00:11:41:17
Tim
And so that’s why I joined the Warrior program, because I, I had read Raj’s book and I had, you know, watched some of the podcasts and been familiar with what he had done. How thank you. Came to our REIA in Polk County.
00:11:41:19 – 00:11:44:12
Rod
I sure did. Oh, that’s funny. Yeah, that’s right.
00:11:44:18 – 00:11:52:15
Tim
Yeah. I was really impressed with your presentation. Those thanks and okay. That’s why I join.
00:11:52:17 – 00:12:08:19
Rod
Yeah. I think the last time I was a little annoyed because I drove, I mean, it was like 2 hours each way for me and there were like 13 people there and my oh my God, are you kidding me? And I didn’t get home until, like, midnight. Yeah, I remember now. That’s funny. That’s really funny. So let me.
00:12:08:20 – 00:12:26:13
Rod
Yeah, Let me ask you this. What do you think is your superpower? You know, because we talk about superpower, we use that word because everybody you know, this is a team sport. You bring your superpower to the team and you align with people that you know that that are, you know, stronger where you’re not as strong. What what do you think you bring to a team, buddy?
00:12:26:17 – 00:12:31:10
Rod
I mean, besides construction, we know you’re great at that, obviously, because, you know, you mentioned earlier.
00:12:31:12 – 00:12:54:14
Tim
That can the construction knowledge is one of the things that that I can bring to the team, you know, helping structure deals. I know a lot of people, too. I can bring a lot of capital to the to the table. That’s how I did the mobile home park. You know, those were all people that I knew that put together.
00:12:54:20 – 00:13:01:21
Tim
And we raised, you know, about $2 million in 30, 30 days or less.
00:13:01:23 – 00:13:02:09
Rod
Nice.
00:13:02:09 – 00:13:19:06
Tim
You know. So those are some of the things that I can I can bring to the table. If, you know, if somebody wanted me to come alongside them and help. Definitely understanding construction is probably one of the strongest things that I have.
00:13:19:08 – 00:13:20:02
Rod
Yeah.
00:13:20:04 – 00:13:38:02
Mark
A speaking of this deal, correct me if I’m wrong on any of this, you have kind of a an interesting story jumping into this of how you found this deal. I think you you mentioned you found it. You were underwriting an ad area, I think, and you liked it. Tell the story about how you found it and where you found it, where you even got the deal from.
00:13:38:02 – 00:13:40:16
Mark
And then when you got to jump into the deal further from there.
00:13:40:22 – 00:14:04:23
Tim
Yeah. So, so I am the focus group leader for a different series or a different area. It’s called the Central Florida Real Estate Association. It’s from Orlando and I’ve been focus group leader for the Landlord ing Group. They have this group we meet once a month and we we talk about landlords and being a landlord and different issues like that.
00:14:05:00 – 00:14:32:11
Tim
So one of the or twice a year I usually have to have it set up where we do a little segment called Deal or No Deal. And for that I we do some real quick underwriting. It’s nothing that it’s, you know, nothing really intense. But we I give them some ideas of how to look at a deal and determine whether or not there’s potential there that you want to look at it a little bit closer.
00:14:32:13 – 00:14:59:11
Tim
And so I found several several like duplexes, quads, you know, different things on the MLS. And I actually found two mobile home parks out and it was on the multiple listing service. And I was like, Man, let me take a look at these. So we took a look at them and as I was presenting them at, at the focus group and we were going through the numbers, I was like, there might be a deal here.
00:14:59:13 – 00:15:21:04
Tim
And so I actually started looking at it a little bit closer and I actually put both of the mobile home parks under contract and started our due diligence on both of them. One of them dropped out. It was it was not not represented properly because the guy that was trying to sell it, I think he’s trying to pull a fast one on us.
00:15:21:06 – 00:15:42:14
Tim
But the other one, it was a mom and pop and it was hard to get some of the information out of them. But but being that I’ve done this a long time and I’ve, you know, I’m pretty good at and negotiating, I actually pulled the information out of them. Got it. Got it all put together, did our underwriting.
00:15:42:14 – 00:15:55:06
Tim
And I felt pretty confident that this deal was something that we could do. So we went ahead and move forward and and closed it in May of last year. And it’s been a pretty good deal.
00:15:55:08 – 00:16:19:02
Rod
But I’ll tell you, when you find a deal that it’s hard to get the information on, get excited because everyone else gives up. Oh yeah. And and and and if you if you push through, you know, you can you can find a phenomenal deal that way. And that’s pretty interesting how you found that deal. Talk a little bit more about the actual asset you know and well let’s do we can talk about mobile home parks a little bit.
00:16:19:04 – 00:16:31:17
Rod
I know quite a bit about them, although I’ve never owned one. My brother has owned hundreds of of spaces and has been involved in the management of thousands of spaces. So I know a lot about the asset class.
00:16:31:19 – 00:16:44:01
Tim
Well, one one interesting thing, I do have some mobile home experience because back when I was 18, 18 to 25, I worked in a mobile home factory. So I actually know how they’re put together.
00:16:44:01 – 00:16:53:23
Rod
In central Florida. Yeah, yeah, they have them there. It’s like they just this like a conveyer belt of frickin mobile homes go down the line and they add things all the way down the line. Oh, that’s awesome.
00:16:54:01 – 00:16:59:19
Tim
So actually had a little bit experience, so I know how they’re put together anyway.
00:16:59:21 – 00:17:03:06
Rod
Cheap. Yeah.
00:17:03:08 – 00:17:26:04
Tim
Yeah. But this one, all the mobile homes are owned by the park, so it’s. It’s all like having an apartment complex. We had. We had to do our due diligence by inspecting these things because there was some deferred maintenance and I saw quite a bit of it, but I wasn’t scared of it because I know how they’re put together and I know what what to do to fix them.
00:17:26:09 – 00:17:44:10
Tim
And the the tenants that they had were very, had very bad habits, let me put it that way. So we, we had to really start just culling them out as soon as we got in there, like what?
00:17:44:10 – 00:17:46:19
Mark
Like paying late or not paying on time.
00:17:46:20 – 00:18:14:17
Tim
Like, well, paying it all, paying late, Not paying at all. Yeah, there was there was quite a bit of issues. I don’t think that 50% of the people were not qualified to be in there. Wow. Because Mom and Pop that were running before they they had a very poor system of of qualifying people. And we’ve got a professional management company that that that we that I own.
00:18:14:22 – 00:18:40:00
Tim
And and so we we know how to actually do that so we were able to turn it around pretty quick. We still got about two or three units that that needs some rehab and then we’ll have it all full by the end of this first quarter. But it is a little challenging at first because of the of the bad habits and the, you know, the clientele that was in there.
00:18:40:02 – 00:18:57:22
Rod
Well, I’ll tell you, you know, the common business model is not to do what you’re doing is to actually convert them to lot rent and have them on the home, you know, and all that. What you’re doing is is more challenging. And that’s why when you told me it was a mobile home park, I asked you if you live near it because you’d be managing it.
00:18:57:22 – 00:19:15:12
Rod
And you told me you had a management company, which of course makes that a whole lot easier. But you know, they are they are tough to manage. And and typically with a mobile home park, you, you know, I wouldn’t consider one unless it was at least 50 spaces so I could have an on site manager. And so that’s why I asked the question.
00:19:15:12 – 00:19:34:14
Rod
And like I say, you know, my knowledge of these things is, is as you go in, you’d see if the numbers make sense, if you can sell them the home and then they’re paying you, you know, a fee for the home and they’re paying you a lot rent and all that. And and that’s a more common approach. But yeah, with a management company, with a management company, you can make it work.
00:19:34:15 – 00:19:35:04
Rod
Yeah.
00:19:35:06 – 00:20:04:18
Tim
Yeah. I’ve seen the approach that you that you’re talking about. I’ve seen that before. The only problem that I see with, with that sometimes it depending on the condition of the mobile homes, if they’re in rough condition already and you sell them to somebody, they’re not going to maintain them and they’re just going to probably go downhill. So yeah, so you know, what we’re doing is, is doing some repairs, doing some some fixing the deferred maintenance that was on all of them.
00:20:04:18 – 00:20:20:23
Tim
And trying to get them up to speed, we could convert it later. And once we you know, once we get them all in good operational order. But for right now. But, you know, we’re we’re doing all right. The way we have is working.
00:20:21:00 – 00:20:38:04
Mark
Well, I see your five year projections here on this deal. You’re almost going to double double rents, which would be great. And from what I’m hearing and again, you correct me if I’m wrong, if we could go a little deeper, it sounds like it’s very similar to a multifamily value add in that you’re just managing it better, increasing rents, bringing in new tenants.
00:20:38:05 – 00:20:43:18
Mark
Is that the entire play on this deal or is there something else? It’s bring it down so high that we’re missing.
00:20:43:20 – 00:21:08:11
Tim
No, I mean, it was under the rents were too low when we got it. We knew they were low and that’s what made it appealing because we knew we could get higher rents. But it’s still affordable living. You know, it’s not this is not even like your average rent. And Polk County, I think is about 1500 dollars. So we’re around 1100 per door there, maybe a little bit more.
00:21:08:11 – 00:21:11:00
Rod
But single wides are double what.
00:21:11:02 – 00:21:12:09
Tim
They’re single lines.
00:21:12:11 – 00:21:14:08
Rod
Oh, wow. And you’re getting 1100.
00:21:14:10 – 00:21:16:06
Tim
Holy crap. Yeah.
00:21:16:06 – 00:21:21:20
Rod
And wow, I don’t even know what to say to that. Holy cow. Now, that’s funny that.
00:21:21:20 – 00:21:34:11
Mark
You mentioned this deal was on the MLS. Was this with a commercial broker that this just happened to be overlooked or was this with a residential broker that came across this deal? How how did this deal get overlooked, do you think, by other investors?
00:21:34:11 – 00:21:46:03
Tim
The the broker that had it was a friend of the owner. So, yeah, she was she was more a residential, residential realtor.
00:21:46:05 – 00:22:17:11
Rod
She really and that’s that’s actually sorry to interrupt that’s actually a ninja trick, honestly, is to get aligned with residential brokers in a market. I can tell you it’s really interesting that where it’s at because, you know, Kevin Bopp is right. He has that he had a mobile home park course and all of that stuff. And I was actually went to one of his events in Orlando, which is right down the road, and we went to look at a like 100 and some space park that he had bought in Orange, Orange, something Florida.
00:22:17:11 – 00:22:45:05
Rod
It was I was on it was Orange County. I feel like the city name had orange in it. But anyway, it was $2 million and he found it in the residential MLS because the broker didn’t have a clue what to do with it. You know, By the way, guys, what what what happens is someone will buy a house from a residential broker, but maybe they’ve got a mobile home park in this case, or a ten unit eight unit six unit 20 unit, and they’re going to go to that residential broker to sell it who hasn’t got a frickin clue how to sell it.
00:22:45:09 – 00:23:02:11
Rod
So they’ll throw it in the residential MLS and you can get phenomenal deals. So, you know, one of the things I teach in my boot camp is connect with a residential broker in your submarket and and you can, you know you can get deals nobody else is seeing. So yeah. All right that’s good.
00:23:02:13 – 00:23:09:18
Mark
The best way to do that Tim, you can give your advice. Did you yourself have access to the MLS or did you have a broker that you work with?
00:23:09:18 – 00:23:11:19
Tim
I’m a licensed broker, yeah.
00:23:11:19 – 00:23:18:19
Mark
Okay. So you had direct access then? Yeah. So that kind of gave you a little bit of an advantage just digging into the MLS yourself then.
00:23:18:21 – 00:23:19:18
Tim
Right.
00:23:19:20 – 00:23:29:13
Mark
But I would say another good tip just on top of that, if you don’t have access, find a residential agent or somebody that can give you access. So that way you can find those people because otherwise.
00:23:29:13 – 00:23:41:04
Rod
Or or hold on, not, not give you access necessarily, but put an alert in that if any multifamily property hits the MLS, they’ll let you know and you’ll take care of them. They’ll write the contract.
00:23:41:04 – 00:23:41:24
Mark
Depends where you live.
00:23:42:02 – 00:23:52:16
Rod
Oh, no, no. Yeah, yeah. So, okay, so let me ask you this. What’s a hot topic in multifamily that everybody’s talking about right now?
00:23:52:18 – 00:24:18:07
Tim
The hottest topic that I’ve seen lately is, you know, the interest rates being so high. It’s it’s made it very difficult. So financing has made it difficult to make the numbers work. You know, that’s why, you know, I was looking at your deal. In fact, I think I’m going to invest in in your deal in San Antonio. Yeah, because you got that assignable.
00:24:18:09 – 00:24:39:10
Rod
LA Yeah, yeah. I’ll describe that deal real quick. So we’ve got a 296 unit asset a mile away from this one mile and a half away, and this is 200 units, and these units are much nicer than the one we have, which is always in the 90% plus range occupancy. I mean, the units are larger. They all have fireplaces, they all have washer dryer hookups, none of which we have in the other asset.
00:24:39:16 – 00:25:08:08
Rod
And this on a lake, we’ve got 37 units on a lake. But but we’re assuming a four and a four plus percent interest rate that’s still got seven years on it, which is a fantastic loan. So it’s great debt. 37 units on a lakefront. If I didn’t say that already, you know, it’s a it’s a nice four and the unit that built I’m sorry the asset next door sold for 137,000 a unit like a year and a half ago.
00:25:08:10 – 00:25:25:17
Rod
I want across the lake sold for 120,000 a unit that same vintage and this we’re getting this one for 100 I mean it’s a screaming deal. So very, very exciting. I need some work. We got to roll our sleeves up. We’re putting a ton of CapEx into it, a ton of renovation costs, but I mean, they’re going to be really nice and we’re done.
00:25:25:17 – 00:25:46:24
Rod
So very excited about it. And yeah, by the way, if you’re an accredited investor, text the word partner to seven two, three, four or five. And let’s talk about it because we still got a little room left. I mean, it’s getting close to being full, but there’s still some room left on it. Yeah. You know, you talk about the debt and, you know, it’s it’s it’s creating opportunity and there are deals coming.
00:25:46:24 – 00:25:58:10
Rod
So, you know, I think if if there was a time to get in this business, it is right frickin now because we’re already seeing the deals and and there’s going to be a lot more so you know very exciting exciting.
00:25:58:10 – 00:26:05:20
Tim
Time that one right now because just by that we got some seller financing available on it at 5%.
00:26:05:22 – 00:26:24:09
Rod
So see, that’s happening more often too, because see sales are way down. So what we’re talking about with this bad debt, guys, is, you know, if you’ve got loan that’s coming due or you’ve got one of these bridge loans that’s adjustable and you’re getting killed with the payments, you know, if you either have to sell or refinance, neither one are easy.
00:26:24:09 – 00:26:47:22
Rod
Right now. Sales are down 85, 90%. Number one, refinancing is hard because you have to pay what’s called a rate cap. And I’ll give you an example of what’s happened with rate caps. If you were in 2020 and you had a $100 million loan and you wanted to cap the interest rate for three years at 3%, okay, three year rate cap, 3%, that was around $23,000 in 2020.
00:26:47:24 – 00:27:07:01
Rod
Okay. That same rate cap today, a list is shall eight months ago when I saw this. So it’s probably worse than that now. But $300 million loan for one year is 2.3 million. Okay. To give you an idea and you got to buy these two to manage the risk on these loans and people don’t have that kind of money.
00:27:07:01 – 00:27:26:03
Rod
And then, you know, because the interest rates have gone up and their payments have gone up, they don’t qualify to refinance anyway. So a lot of deals that are in big trouble. So, you know, again, we’ve set up an opportunity, fund it to, you know, hopefully capitalize on some of these deals. And, you know, I think I think there’s a lot of opportunity coming.
00:27:26:03 – 00:27:26:24
Rod
So.
00:27:27:01 – 00:27:37:02
Mark
Yeah. Tim, tell us about that. Without giving maybe specifics on location, anything like that. Well, tell us about this deal. Is it a multifamily deal? Why are they selling? Where did you find it?
00:27:37:04 – 00:28:11:07
Tim
Yeah, it is. Yeah, well, I won’t give too many details because we don’t have it under contract. Yeah, we’re still in the beginning process, but it’s it’s a group of duplexes that a guy built years ago when he was building another community and I think there’s 150, 158 or something like that. And so he he’s got it’s free and clear and he, he built it along with this other community that he actually sold off.
00:28:11:07 – 00:28:17:22
Tim
And he kept this community and he’s been renting it out and he’s just tired. Landlord ready to move.
00:28:17:22 – 00:28:28:00
Rod
Oh, my God, what a scream. And Dale Holy cow. How exciting is that? Well, listen, let me ask you a question. You know, I know you joined the Warrior program. How have you enjoyed it? Has been good.
00:28:28:02 – 00:28:41:15
Tim
Absolutely. Yeah. Yeah, I really enjoyed it. I go every time you have one of the warrior. Only the warrior only events. I really like those. Yeah. The other ones are good, too. But the warrior only events are phenomenal.
00:28:41:17 – 00:29:03:21
Rod
It’s all warriors. And it’s an incredible group. By the way, guys, if you’re interested in applying to the program, text the word crush to seven two, three, four or five. And and that’s how you apply Text crush 2723, four or five. You know, I think my warriors own somewhere between 180 and 190,000 units that we know of. We can’t keep track anymore, but it’s not insignificant.
00:29:03:21 – 00:29:14:04
Mark
And by the way, on that topic, we have a warrior event coming up in two months in Florida. So have you been considering something like this? Now might be a good time because we’ve got one coming up here shortly.
00:29:14:06 – 00:29:38:02
Rod
Yeah, in April. Yeah. Now we’ve got a warrior event here in Sarasota, which it’s an awesome venue that we do it out to the West and it’s been a lot of fun. We’ve been there two or three times already, so. Yeah, Yeah. Well, anyway, Tim, thanks for coming on the show, brother. That’s been a lot of fun. I really appreciate you sharing your wisdom and you know, looking forward to seeing, seeing where you’re at a year or two from now, which I’m sure will be extraordinary in that deal you’re working on.
00:29:38:02 – 00:29:42:05
Rod
Sounds like you get it. Yeah. Take care, brother. I appreciate you.
00:29:42:11 – 00:29:43:24
Tim
And I’ll see you in April.
00:29:44:01 – 00:29:48:08
Rod
All right. Thanks. Thanks. Take care.
00:29:48:10 – 00:29:55:02
Intro
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