How He’s Buying 57 Units For $0 Down (Taking Over Debt)

How Distressed Multifamily Investment Opportunities Create Value

In this episode of Lifetime Cash Flow Through Real Estate Investing, Matt Teifke shares his perspective on identifying distressed multifamily investment opportunities and why market downturns often create the best buying environments for experienced investors. Instead of chasing deals during overheated markets, Matt explains how patience and disciplined underwriting can position investors to acquire properties at significant discounts when conditions shift.

During the conversation, Matt walks through how many investors in recent years purchased properties at extremely low cap rates and aggressive valuations. When interest rates rose and operating costs increased, some of those deals began to struggle financially. For investors who understand the fundamentals of multifamily real estate, this shift has created a new wave of distressed multifamily investment opportunities where properties can sometimes be acquired at or near the existing debt balance.

Matt Teifke MFRS Script

Matt emphasizes that real estate success is not about timing every cycle perfectly, but about recognizing when the numbers finally make sense and acting decisively.

Matt Teifke’s Background in Real Estate

Matt Teifke has been involved in real estate for more than sixteen years. His journey started early after watching his single mother build a portfolio of rental houses while raising two children on her own. That experience shaped his perspective on the long term power of real estate ownership and the discipline required to build wealth through property investments.

Matt Teifke MFRS Script

At just eighteen years old, Matt earned his real estate license and quickly became highly competitive in the industry. Over time he built a real estate brokerage with more than 100 agents and gained experience across multiple asset classes including multifamily, retail, and self storage. His background also includes earning a master’s degree in real estate from Texas A&M and participating in numerous investment deals across Texas.

Today, Matt focuses on identifying undervalued real estate assets and building long term wealth through strategic acquisitions and operational improvements.

A Real Example of a Distressed Multifamily Deal

One of the most valuable parts of the conversation is Matt’s breakdown of a real distressed multifamily investment opportunity he recently acquired. The property had originally been purchased for $7.5 million with seller financing, but the ownership group began losing money each month due to poor management and unrealistic projections.

Rather than attempting to force appreciation through aggressive rent growth, Matt focused on operational improvements and market fundamentals. The property had multiple vacant units in a strong rental market, meaning the primary issue was not demand but management execution. By taking over the existing debt and improving operations, he was able to structure a deal with little upfront equity while creating immediate upside potential.

Matt Teifke MFRS Script

This example highlights how distressed multifamily investment opportunities often arise when owners become financially or mentally exhausted with a property.

Key Indicators of Distressed Multifamily Opportunities

Matt explains that distressed deals rarely appear obvious on paper. Many of the best opportunities require investors to analyze the people behind the deal as much as the financial numbers. In many cases, struggling owners simply reach a point where they want to exit the property, even if it means walking away from the original investment.

Several indicators often signal distressed multifamily investment opportunities:

• Owners losing money monthly and running out of operating reserves

• High vacancy despite strong local rental demand

• Poor marketing or property management

• Owners who appear mentally checked out or ready to move on from the asset

Recognizing these signals allows experienced investors to approach deals with creative structures that benefit both parties.

The Importance of Cash Flow in Multifamily Investing

Throughout the conversation, Matt reinforces a principle that experienced investors consistently emphasize: cash flow must drive every investment decision. Many investors overpaid for multifamily properties during the peak of the market cycle, assuming appreciation alone would justify the purchase.

Matt’s philosophy is much simpler. He focuses on buying assets that meet three fundamental criteria:

• The property is purchased below previous market valuations

• The acquisition price is below replacement cost

• The property produces positive cash flow

If those conditions are met, the downside risk is significantly reduced while long term upside remains strong.

Advice for New Multifamily Investors

For listeners who are just getting started in multifamily real estate, Matt encourages action over endless analysis. Many aspiring investors spend years studying strategies without ever submitting an offer or building real relationships in the industry.

His recommendation is straightforward. Start by making offers, talking with potential investors, and building relationships with experienced operators. Real estate is a relationship driven business, and long term success often comes from the network you build over time.

Matt Teifke MFRS Script

He also stresses the importance of thinking long term. Investors who view real estate as a decades long wealth building strategy tend to make better decisions than those chasing quick profits.

Why Long Term Ownership Matters

Another interesting perspective Matt shares is his belief that the best real estate investments are often the ones you never sell. While many syndications project five year exits, Matt and Rod discuss how refinancing and holding strong assets can often create greater wealth over time.

By maintaining ownership of well performing properties, investors can continue generating cash flow while benefiting from appreciation and tax advantages.

If you want to hear the full conversation and detailed insights, watch the podcast video or read the complete transcript below.

Distressed Multifamily Investment Opportunities FAQ

What are distressed multifamily investment opportunities?

Distressed multifamily investment opportunities refer to apartment properties that are experiencing financial, operational, or ownership challenges that create the chance to purchase them at a discounted price. These situations often occur when owners struggle with rising expenses, high vacancy rates, poor management, or loan maturity issues. Investors who specialize in distressed multifamily investment opportunities look for properties where operational improvements or financial restructuring can quickly increase value. By solving the underlying problems, investors can create stronger cash flow and long term appreciation.

Why are distressed multifamily investment opportunities increasing in 2026?

Distressed multifamily investment opportunities have increased in 2026 due to higher interest rates, tighter lending conditions, and rising operational expenses. Many apartment properties were purchased during the previous market cycle using aggressive projections and short term financing. As loans mature and expenses continue to rise, some owners are unable to refinance or maintain profitability. This shift has created opportunities for well capitalized investors to acquire properties at lower valuations and reposition them for long term performance.

What causes a multifamily property to become distressed?

Several factors can cause a multifamily property to become distressed. Poor property management is one of the most common reasons, leading to higher vacancy rates and declining property conditions. Rising operating costs such as insurance, taxes, and maintenance can also create financial pressure on owners. In other cases, distress occurs when short term loans mature and the property cannot refinance at higher interest rates. These situations can create distressed multifamily investment opportunities for investors who understand how to stabilize operations.

How do investors find distressed multifamily investment opportunities?

Investors often find distressed multifamily investment opportunities through broker relationships, lender contacts, and direct outreach to property owners. Some distressed deals appear on the market through traditional listings, while others are negotiated privately before reaching public listings. Networking within the real estate industry is one of the most effective ways to uncover these opportunities early. Investors who consistently analyze deals and maintain strong industry relationships are more likely to discover properties before competition increases.

What are the benefits of investing in distressed multifamily properties?

Distressed multifamily investment opportunities can offer several advantages for experienced investors. Properties are often acquired below market value or below replacement cost, which can reduce downside risk. Investors may also be able to increase property value through improved management, renovations, or better marketing strategies. Once stabilized, these properties can produce stronger cash flow and significant equity growth compared to assets purchased at peak market prices.

What risks are involved with distressed multifamily investment opportunities?

Distressed multifamily investment opportunities can involve higher risk if investors underestimate the operational challenges involved. Properties may require significant renovations, management changes, or operational restructuring to reach full performance. Unexpected repair costs or tenant turnover can also impact financial projections. Successful investors carefully analyze the property’s financials, local market demand, and renovation requirements before acquiring distressed assets.

What strategies help turn distressed multifamily properties into profitable investments?

Investors typically focus on operational improvements when repositioning distressed multifamily properties. This can include renovating units, improving property management, strengthening marketing strategies, and optimizing operating expenses. Increasing occupancy and raising rents to market levels are often key parts of the value creation process. When executed effectively, these strategies can transform distressed multifamily investment opportunities into stable, cash flowing assets.

Are distressed multifamily investment opportunities good for long term real estate investors?

Distressed multifamily investment opportunities can be highly attractive for long term investors who have the experience and capital to stabilize properties. Buying assets during periods of market disruption often allows investors to acquire real estate at favorable prices. Once the property is stabilized and operating efficiently, it can generate consistent income and long term appreciation. Many experienced multifamily investors actively seek distressed opportunities because they offer some of the strongest potential returns in the real estate cycle.

Disclaimer: This summary was written with the help of AI and reviewed by Rod’s Team.

00:00:28:24 – 00:00:46:02
Rod Khleif
Welcome back to multifamily Rock stars. As you guys know, these are the episodes where we deep dive into our guest deals, give you some practical and actionable items for getting started and and doing your first deal, especially if you’re brand new to the multifamily. And I’ve got my co-host MarK Nagy with me here as usual. Yeah.

00:00:46:02 – 00:00:49:16
Mark Nagy
What’s going on, rod? You mentioned you’re going out of town. Where are you going? On vacation.

00:00:49:18 – 00:01:07:14
Rod Khleif
I’m taking a I’m taking a cruise. You know, I love cruises because there’s, you know, I don’t I don’t love having to figure out hotels, taxes, restaurants and everything else. I get on a cruise ship, and I just have to be able to crawl back to my room, you know? So there’s no stress. I don’t have to think about a damn thing.

00:01:07:14 – 00:01:29:04
Rod Khleif
I’m doing Virgin, which doesn’t have any kids, so it’ll be interesting to see how that goes. Yeah. Let’s see, we’ll see. I’ll let you know. Yeah. All right. So, got, Matthew Typekit on with us today. He’s a warrior. Has been in the real estate game for 16 years. Actually owns a real estate brokerage, and, I know he’s going to add tremendous value.

00:01:29:04 – 00:01:32:04
Rod Khleif
And, so, welcome to the show, brother.

00:01:32:06 – 00:01:41:00
Matt Teifke
Thank you. Man, I’m glad to be here. I love talking real estate. Happy to be with you guys as well. And here to provide as much value as I possibly can.

00:01:41:02 – 00:01:56:16
Rod Khleif
Love it. Love it. Well, why don’t you give us a little background? Who you are? You know why? Real estate. Where you came from? And maybe even why you joined our group, with with the experience level that you have. So, take it away, brother. Let’s let’s, you know, give us kind of a high level overview.

00:01:56:18 – 00:02:23:07
Matt Teifke
Yeah, let’s get it, man. So I’m 34 years old. I got in the real estate business when I was 18 as a real estate agent, but really started with my mom, and I was raised by a single mom. And, by the time I was 16, she had 17 rental houses. And, when we first moved to Texas, I moved to Texas when I was three years old from Cleveland, Ohio.

00:02:23:09 – 00:02:45:02
Matt Teifke
She was literally cleaning houses. I remember that was her job. So she straight up went from cleaning houses, raising two boys on her own, to owning all these rental houses. And the few things that I want to point out about that are one I’ve never found anybody, who has a good excuse as to why they can’t do this after seeing that.

00:02:45:04 – 00:03:10:13
Matt Teifke
And two, what does it mean to own real estate? Right. When we were growing up, everybody knew my mom had all these rental houses, but by no means did that mean that, she was retired and we were banking, and life was easy, right? Because she was getting that. But she sacrificed a tremendous amount. And so I got my license when I was 18 years old, and, man, I was as competitive as anybody.

00:03:10:13 – 00:03:35:13
Matt Teifke
You’ve ever met in this business. I remember my whole thing was like at the time, you know, first one and last one out. I was a full time student. I got the rookie realtor of the year. You know, everybody else was not taking any college classes. But I remember thinking, at 18, I want to be doing more in real estate than anybody my age at 19, same thing at 20, at 21, etc..

00:03:35:15 – 00:04:07:17
Matt Teifke
And man, 16 year journey. I ended up going and getting my master’s degree in real estate from Texas A&M. I couldn’t get accepted into Texas A&M out of high school. My grades weren’t good enough, but because I had the real world experience, it was a different spin and it allowed me to get into that program. I worked at a very high end commercial brokerage downtown Austin, Texas for three years, and it wasn’t me as far as like, you know, you had to dress a certain way.

00:04:07:17 – 00:04:28:00
Matt Teifke
You know, you have to act a certain way you want and dine your clients, and that’s fine. But it wasn’t me, but I was. I was there at this company for three years, and I was like, man, I’m learning a tremendous amount and I’m around very sharp people. So it kept me hanging on. The whole time I was there, my wife was building a property management company.

00:04:28:02 – 00:04:51:16
Matt Teifke
We got up to 780 single family homes that we were managing. That was crazy. It was intense. You know, she’d break down crying once a week, and I’m like, babe, you got to keep doing it. We’re making money. We’re doing the right thing. Built my brokerage to 180 agents. Personally. Lost, $4 million on a publicly traded stock.

00:04:51:18 – 00:05:15:18
Matt Teifke
Totally unrelated to real estate, but, man, it was it was humbling. It was, discouraging. It got me closer to God. It was like I just learned so much. But now I’m like, five years through that. And last year, we bought $70 million of assets. I feel momentum again, and I feel like I’m. I’m building, but I want to do it in a place of, like, it’s not all about me.

00:05:15:18 – 00:05:34:11
Matt Teifke
Like whether I have a lot of money or not. I want to provide value. And like I said, I’m 34, man, and I’ve never come across I say this truly, humbly, anybody my age that that understands real estate, the way that I do, and I just want to pass that on the best way that I can, I love it.

00:05:34:11 – 00:05:51:19
Matt Teifke
I think it’s a really good time to be in the business. Ever since I’ve been in it, it was a hot market. This is the first time I’ve gone through a downturn. And so it’s just exciting, man. I’m fired up. I’m. I’m excited to be here. I love what I do every day, and, it’s a blessing to be in this business.

00:05:51:21 – 00:06:08:11
Rod Khleif
You know, it’s it’s interesting. You we have a lot of parallels, brother. I don’t know if you recognize that. If you’ve heard me talk, because I was 18 when I got my real estate brokers license, I could actually become a broker back then through experience. I mean, through, education. Now you need some experience to be a broker.

00:06:08:11 – 00:06:24:05
Rod Khleif
But I was a broker, right when I turned 18, and, and my mom bought rental properties like your mom did. So that’s kind of cool. And I started a property management company, and it is a thankless frickin job, man. People don’t call you when they’re happy tenants to call you when they’re happy, and owners don’t call you when they’re happy.

00:06:24:07 – 00:06:36:23
Rod Khleif
So I feel for your wife in that regard. And I lost a lot of money like you did. So, yeah, lots of parallels. So why did you join the warrior program with all that experience? With a degree and all that? What what prompted that?

00:06:37:00 – 00:07:04:11
Matt Teifke
Yeah, man. So, for ten years, I, I was never the type of person to join any program. I would never pay for anything. And, you know, I don’t know if I was, why I thought that way, but I was always doing my own deals. I only started syndicating in the last three years, and I’ve done five funds, but I have always been a networker, and it’s always been very hyperfocus.

00:07:04:11 – 00:07:32:14
Matt Teifke
Like, I know everybody in Austin, like I know everybody, right? I know, I know all my competition and all the brokers. I know all the property managers. And then I realized, okay, I built this really strong local network. Now I got to build a network in the U.S. and I’ve tried to do, in a sense, what you do, after you had done it way after of, like, building my own community and, you know, teaching courses and everything like that.

00:07:32:16 – 00:07:57:19
Matt Teifke
And then I realized, man, if I can just go join where other people are, like, you have already funnel the collection of sophisticated or new, you know, there’s a mix group of real estate professionals. And if I can get in that room, then it’s on me to to make money and to create value and capture value. But you’ve already created the space.

00:07:57:21 – 00:08:02:22
Matt Teifke
So why would I go create my own space? You’ve done it and I can just plug into it. So.

00:08:02:22 – 00:08:05:02
Rod Khleif
So you wanted the you wanted the network basically.

00:08:05:04 – 00:08:25:17
Matt Teifke
Yeah. But I mean, do I learn things? Absolutely. Like, you know, there’s, there’s subconscious things that I even learn even by seeing the way you talk or communicate. And I don’t even always know how to lay that out. But, like, if I just want to be in rooms of people that are in real estate that are focused and I’m good, and the more rooms the better.

00:08:25:19 – 00:08:43:18
Matt Teifke
And I say this all the time, but like, if you can’t get in your community and make money in real estate, then you can’t make money in real estate in general. Right? I believe that, and so it’s the network, like you said, and then playing the long game. But there’s always there’s always tips and things to learn.

00:08:43:18 – 00:08:51:14
Matt Teifke
So it’s I’m getting as much value out of it as I can every day. And you’ve just done a good job of creating that room.

00:08:51:16 – 00:08:52:14
Rod Khleif

00:08:52:16 – 00:09:14:08
Mark Nagy
So let’s talk to those people Matt for a second that are brand new. Have that. Obviously you have a lot of experience coming into this. Most of the people probably listening have not done any multifamily. What would you say are some of these actionable steps from your experience that the listeners could take and go just start doing starting from scratch with no multifamily experience.

00:09:14:10 – 00:09:33:10
Matt Teifke
When there’s a lot, you know, and I try to just you can just simplify it. I mean, just on what you’re talking about, it’s like, hey, you know, you can you can strategize all day about the big picture, but it’s like, how about you go make ten offers on properties and talk to ten investors and then let’s talk again.

00:09:33:11 – 00:09:55:06
Matt Teifke
That alone will be tremendously valuable, right? But the quicker you get in the game and you have to be doing it with people that you trust. Like rod mentioned on on one of his podcasts on Saturday. You know, lessons that he learned from from his management company and things that he’s going through. I’m extremely interested in asking him what that was so I can learn from it.

00:09:55:06 – 00:10:28:20
Matt Teifke
Right. But if I was brand new, I would say, who are the 5 to 10 people that I respect and look up to and see that are doing things? And how do I genuinely provide them as much value as I can with a really long term approach, right? Like live fast, but a lot can be accomplished. I plan to do this for 30 years, for 50 years, and if I think about the conversation I’m having with rod right now, with you right now, Mark, in the terms of can we be talking in one year, two years, five years, that’s the real value.

00:10:28:22 – 00:10:33:10
Matt Teifke
There’s a lot of fly by nights that want to get in and just make things happen and.

00:10:33:12 – 00:10:35:14
Rod Khleif
Take a pill. They want to take a pill.

00:10:35:14 – 00:10:44:02
Matt Teifke
Yeah. And it’s just, I mean, you, as you know, rod, like, even if you go by a huge deal, there’s still a lot of work and a lot of things that have to take place.

00:10:44:02 – 00:11:06:05
Rod Khleif
After all the work starts after you buy it. I mean, buying it, buying it’s one thing, but but managing it and maintaining it and and properly guiding it, through a value add process. It’s a, it’s a, you know, five year window. So, you know, in fact, when we carve up one of our, our syndications, our GP’s, the asset management piece is the biggest chunk because that takes the most amount of work.

00:11:06:05 – 00:11:18:02
Rod Khleif
So whoever’s going to participate in that share that shares in the biggest chunk of the deal. So, you know, talk about what sorts of listeners you think would relate to you the most.

00:11:18:02 – 00:11:47:17
Matt Teifke
Matt, relate to me. I would say the, the people that have the fire in their eyes that really, really want to do more. You know, some people are here to, to dabble, like, that’s not me. I’m on this podcast. I’m talking a lot, but I’m not really a talker. I’m. I’m a do it right. And so it’s the people that that have the burning desire to do more and that think long term.

00:11:47:19 – 00:12:09:24
Matt Teifke
Right. And like old, old school soul man like my word, my handshake. They mean things, people that are what I call students of the game. Right. Like, do you know the history of real estate? Like, is that really important? I don’t know, but it shows that I care. Right? Who are the who are the greatest real estate people that there ever was?

00:12:09:24 – 00:12:23:11
Matt Teifke
Like, I study that kind of stuff. And so people that think like that, that resonate with that, that want to be doing this 20 years from now, 30 years from now, those are the people that they just get what I’m talking about.

00:12:23:13 – 00:12:24:06
Rod Khleif

00:12:24:08 – 00:12:39:18
Mark Nagy
By the way, Matt, I know that’s why we’ve connected so well, because that would say that’s me. And we’re exactly the same age, in case you didn’t know. So. And really what? Yeah, probably why we have connected. So let’s get into some of your deals. And if you know, you can kind of tell us where do you want to guide this?

00:12:39:20 – 00:12:54:19
Mark Nagy
You’re in Austin, which, as you probably know better than anybody living there, is one of the toughest markets right now because it was overbuilt and everything tells us just about some of the most recent deals that you’ve done where you’re buying, you know.

00:12:54:20 – 00:13:10:12
Rod Khleif
Want to start with one? Start with one, though. Start with one deal. Let’s yeah, let’s start with one deal. I know, you’re in San Antonio as well, which is right down the street from Austin where I have assets. And it has been some struggle there as well. But, talk about talk about a deal. Pick one and let’s go through it.

00:13:10:16 – 00:13:32:13
Matt Teifke
Yeah. So I’ll talk about a deal that that I’m personally buying right now. I’m not I’m not. Bring it on investors. It’s just me. And typically on these larger deals I have. But like, sometimes, you know, I’ve always thought of you don’t. At least for me, stepping back, like, I’m not trying to get myself a job. I like to be entrepreneurial within real estate.

00:13:32:13 – 00:13:54:12
Matt Teifke
And that’s that’s what’s led me to apartments or retail building or storage. And that’s not saying that’s right or wrong, but some people just do one thing, and that’s great. But to me, I want to continuously explore opportunities. And so I live in, round Rock, Texas, and there’s two apartment complexes that I actually really wanted to buy five years ago.

00:13:54:14 – 00:14:16:06
Matt Teifke
They’re like down the street from where I live, and I couldn’t the problem with this deal and really every deal for for me, I wasn’t buying in 2020 and 2021. Any large deals? Specifically in Austin and San Antonio, because they were three caps and four caps. So for for listeners like that’s a low return on these deals and you’re paying really high price.

00:14:16:08 – 00:14:38:22
Matt Teifke
So anyways, I’ve got two apartment complexes. It’s 57 doors and the, the group that bought it. And this was this was what happened a lot five years ago. They were everybody was stretching and they were thinking the market was going to go the exact same direction that it was going, and they’d go raise the money on these deals and 24 hours and 48 hours.

00:14:38:22 – 00:15:03:07
Matt Teifke
And they weren’t even that experienced. I don’t know if this is right or wrong, but that bothered me. You know, it bothered me, right? So anyways, long story short, this group bought this property. The owner financed it for $7.5 million. They’re paying $30,000 a month on their debt, and they’re losing like 10 to 15,000 every month.

00:15:03:09 – 00:15:24:19
Matt Teifke
They have 100 K in the bank. And so they’re slowly just losing all of it. Right. So I literally structured this deal yesterday. Met it. Met found the deal through a broker that I know the broker was an investor in the deal. And everybody’s losing their money, and they’re just turning the deal over to me at the debt amount.

00:15:24:24 – 00:15:35:18
Matt Teifke
So it’s the debt amounts 5.2. So I’m this is actually a true, in a sense, zero down. I’m just I’m just taking over the debt. The beautiful.

00:15:35:18 – 00:15:39:12
Rod Khleif
Thing. What are you what are you going to do to make it better than what these guys did?

00:15:39:14 – 00:15:41:18
Matt Teifke
This is a great question. So.

00:15:41:18 – 00:15:47:05
Rod Khleif
Because otherwise you’re going to be in the same place they are after pumping a lot of money and so tell me what you’re doing differently.

00:15:47:07 – 00:15:55:04
Matt Teifke
Well, there’s a few things and there’s a psychology to it. Right. Number one, they’re mentally defeated and they’ve and they’ve given up.

00:15:55:06 – 00:15:56:11
Rod Khleif
Valid point.

00:15:56:13 – 00:16:23:05
Matt Teifke
There’s 11 units vacant in round Rock, Texas, which is a great market. It’s downtown, round Rock, and there’s 11 units vacant. I could go get six. I could at least six of those. No lie in 3 or 4 days. I mean, these are these are like $900 to $1100 rents. You know, you don’t you don’t beat that. So they’re mentally checked out.

00:16:23:07 – 00:16:50:06
Matt Teifke
Their management is horrible. Like this is a side note. And this is, this is me just to give insight like it’s it’s basically like insider trading when you’re at my level, you know, everything that’s going on. You know all the stuff. Right. The, the lady that is the property manager and the GP, I met her two weeks ago and she’s trying to totally sell her property management company.

00:16:50:08 – 00:16:51:21
Matt Teifke
So not only she’s.

00:16:51:21 – 00:16:53:24
Rod Khleif
She’s checked out to wow, she’s okay.

00:16:53:24 – 00:17:16:13
Matt Teifke
So I double checked out, right. I have ten minutes from here. Like, dude, I will go there every day and I have the money to buy it. Zero down. I can I can still bring my own capital for renovations and things like that, but I spent a significant amount of money when you. I haven’t seen the insides.

00:17:16:13 – 00:17:24:16
Matt Teifke
I just went under contract. I’m going to go tour it, in the next couple days. But the outsides are beautiful. Like they put a lot of work into it.

00:17:24:18 – 00:17:27:10
Rod Khleif
So it’s 57 units. The debt is, what.

00:17:27:12 – 00:17:28:20
Matt Teifke
5.2?

00:17:28:22 – 00:17:37:12
Rod Khleif
Wow, that’s a decent price per unit. What’s the what’s the unit mix? Meaning when I ask that question, guys, it’s how many one bedrooms, two bedrooms, three bedrooms, things like that. What’s the mix.

00:17:37:12 – 00:17:41:18
Matt Teifke
There? It’s half and half directly. One on one and two twos.

00:17:41:24 – 00:17:44:17
Rod Khleif
And what’s, the sizes of the units? Decent.

00:17:44:19 – 00:17:50:01
Matt Teifke
Yeah, they’re they’re, 900ft². 12 are good size for here.

00:17:50:03 – 00:17:55:23
Rod Khleif
Yeah. Okay. Okay. And you’re going are you going to self-manage through your management company?

00:17:56:00 – 00:18:05:17
Matt Teifke
Yeah. So me and my so typically on, just for reference, like on the big deals that I bought, I use another company, but these small ones, these 20 and 30s.

00:18:05:18 – 00:18:05:23
Rod Khleif
Yeah.

00:18:05:23 – 00:18:08:11
Matt Teifke
These big companies don’t even manage these things.

00:18:08:13 – 00:18:24:14
Rod Khleif
It’s fine if they try, they’ll they’ll screw it up. Okay. And I tell people when I’m training, if you’re going to hire a third party management company, they need to manage the same size units. Because if you get somebody that manages 100 unit properties, you give them that 20 or 30, they’re going to crash and burn and vice versa.

00:18:24:16 – 00:18:34:08
Rod Khleif
Okay. As you know, being in the business and and if you have somebody that manages A and B class assets, a C asset, they’re going to crash and burn. By the way, what class asset would you call this. Just out of curiosity.

00:18:34:09 – 00:18:36:00
Matt Teifke
I would say C plus.

00:18:36:02 – 00:18:39:01
Rod Khleif
Okay okay. And what’s the area. Is it C as well.

00:18:39:07 – 00:18:43:04
Matt Teifke
No area is B plus B plus okay.

00:18:43:04 – 00:18:47:17
Rod Khleif
So so so the goal is to bring that class of that property up to B. Yes.

00:18:47:18 – 00:19:11:02
Matt Teifke
Yeah I mean it’s it’s downtown round Rock is is nice. And you’re one street over and it kind of just, just this little one little pocket drops off. And I would own 50% of that pocket. And then the rest, it’s like a loop. And the properties that loop around it are all duplexes. And then one street over, there’s 6 or $700,000 houses.

00:19:11:04 – 00:19:23:14
Matt Teifke
So it’s very clear like this. The city has always been growing. It’s a very well-run city. It’s the safest cities in the country. It’s very clear, like this is a location that you want to be in.

00:19:23:16 – 00:19:24:17
Rod Khleif
Okay.

00:19:24:19 – 00:19:36:13
Mark Nagy
So what’s the plan on the exit? You mentioned that you’re taking over the debt. Like, how many more years do you have on that? Is there a plan to refinance out? I guess I would ask, why haven’t they reached this refinance into better debt? I mean, maybe they can’t, but.

00:19:36:15 – 00:20:01:22
Matt Teifke
Yeah, that’s that’s so that’s a great question. That is the risk. So one they can’t they can’t refi out because it doesn’t look good the way that they’re operating it losing money. But the the debt expires in two years. So that’s the risk. My goal during the contract phase of this is to get with the the note holder.

00:20:01:24 – 00:20:19:12
Matt Teifke
He’s just a local guy. And I, I would imagine that he wants to take it back. So I don’t have a lot of I don’t have a lot of leverage. I’m not sure. But I want to get him to extend that for 1 or 2 more years. I’d feel a lot better that the two year balloon is pretty risky.

00:20:19:14 – 00:20:38:11
Rod Khleif
Yeah. You, me you pretty much need to stabilize it in a year. Max. Year and a half. And get it to. And so, guys, the way Fannie Mae and Freddie Mac works, which is conforming debt, you need to be 90% physically occupied for 90 days. It’s 90 for 90. And then you can refinance into some non conforming debt.

00:20:38:15 – 00:20:56:17
Rod Khleif
Now I’m guessing you know you get the numbers looking better. You could you could probably get bank financing as well. You know with a local bank I’m guessing you’ve got some local bank contacts being living there your whole life. So you know, you may want to start those communications sooner than later. Just as a, as a backup, right?

00:20:56:19 – 00:21:18:19
Matt Teifke
Yeah. I mean, absolutely. That and then also maybe I, you know, there’s always there’s always room to negotiate and bring value. Right. So maybe when I’m talking to this know holder, I tell him I’ll give him $500,000 right now or 100,000, who knows. And then we restructure it based on him getting a little bit of capital immediately.

00:21:18:21 – 00:21:23:07
Mark Nagy
What’s the rate at currently? What what is it? Do you said they buy in 2020 or 21.

00:21:23:09 – 00:21:26:17
Matt Teifke
21. Yeah. So and he’s pretty low then.

00:21:26:18 – 00:21:27:00
Mark Nagy
Well.

00:21:27:03 – 00:21:30:18
Matt Teifke
Well he owner financed it and he stepped it up so sure.

00:21:30:24 – 00:21:38:14
Rod Khleif
Oh sure. That’s a benefit you get seller financing. They’re they’re going they’re make either making money on the purchase price or on the rate. So what is the rate.

00:21:38:16 – 00:22:03:17
Matt Teifke
Well it’s 6% right now next year okay. Seven. Oh well he but but this guy made it on both in my opinion because he got top, top price. I paid $7.5 million for it now, which was like 140 a door. Now I’m buying it at 100 CAD or. Right. So he’s in a great spot, but does he really want to manage, you know, you know rod and everybody else.

00:22:03:17 – 00:22:10:21
Matt Teifke
Mark like managing this thing is a it’s a full time job and does does he want to do that. I doubt it.

00:22:10:23 – 00:22:24:20
Mark Nagy
Well you mentioned that I don’t know if we’ve ever heard here before. I mean I’ve done hundreds of these episodes with you, rod, and I’ve never heard anybody say that the opportunity was just because the owners checked out and have given up. I think that’s the first time I’ve heard so well.

00:22:24:22 – 00:22:30:16
Rod Khleif
And they may have never said it, but I can tell you it’s a very common dynamic. Yes. No. Yeah.

00:22:30:18 – 00:22:47:03
Mark Nagy
But I think that was such a gold nugget of something to look for in deals, especially right now, is you can look at the debt, you can look at the the numbers, the things on paper. But just analyzing the owner and seeing that they’ve give it up. I thought that was such a good golden nugget that I’m going to take.

00:22:47:03 – 00:22:49:22
Mark Nagy
Yeah. Moving forward, that well, the thing I’ve heard anybody say on.

00:22:49:22 – 00:22:53:16
Matt Teifke
Here and Mark, they’re not going to to that point. Like they’re not going to tell you that.

00:22:53:18 – 00:22:54:16
Mark Nagy
Right, right.

00:22:54:18 – 00:23:16:05
Matt Teifke
But you can figure it out. And it’s like, okay, you guys have 11 vacant units. I’ve never I have a brokerage of 100 agents here in Austin. I’ve never heard of this property. I’ve never seen a, ad for lease. It’s not on Facebook Marketplace. There’s no sign out from it. And you’re totally vacant. So, like, what’s the deal?

00:23:16:05 – 00:23:38:11
Matt Teifke
Like? And and you’re selling your management company. That’s the insider trading of, like, being super locked in there. This is a little another maybe side nugget, I don’t know. But like, I’m at a very high end broker for lunch. Last week in Austin and I said, what are you looking for? How can I bring you value? And he said, I’m looking for the dumb money.

00:23:38:13 – 00:23:58:06
Matt Teifke
Right. And like this business, y’all know this. It’s extremely competitive. And what he’s basically telling me is he’s trying to screw people over. Right. And and like, if you’re not the insider trading, whatever you want to call it, locked in, there’s a really good chance that you’re the dumb money.

00:23:58:08 – 00:24:16:20
Rod Khleif
Let me explain something on that note, guys. And I mean, yeah, you could talk about the dumb money. I’m talking more about being locked in, though. You know, when I. When I teach this, I teach people. Become an expert in one frickin market. Don’t be all over the place. The most successful operators I see are the ones that are geographically specific.

00:24:16:22 – 00:24:21:06
Rod Khleif
And so that that’s what. That’s what I mean by locked in. I assume you mean the same thing. Yes. I mean.

00:24:21:12 – 00:24:29:09
Matt Teifke
Yeah. Like if I was to go buy a deal in Houston, which I don’t know, Houston, there’s a really good chance I’m the dumb money.

00:24:29:11 – 00:24:43:22
Rod Khleif
Yeah, you’re going to screw up and you’re going to screw up in some way. You know, it’s very possible. And so you know it it’s it’s it’s if you’re new and you’re starting this thing, don’t think you’re going to pick several markets and just try to find the best deal. Know, become an expert in one market. That’s what I.

00:24:43:22 – 00:25:07:24
Matt Teifke
Teach. And it’s not even like you’re right. But it’s also like you got to realize that the deal that I’m getting if if the brokers, father in law passed on it, the broker’s best friend passed on it. The brokers, fraternity brother passed on it. Then I’m the dumb money, so I’m trying to get as close as I can to not being down at the bottom of the list.

00:25:08:01 – 00:25:25:09
Matt Teifke
And if you don’t know where you’re at at the list, you’re probably the dumb money, right? Yeah, I know I’m at the top of the list on this deal because I’m talking directly to the owner. I tried to buy a few years ago. They have to sell all these little, small, little reasons. But you’ve got to you’ve got to be super in the trenches tonight.

00:25:25:09 – 00:25:35:01
Matt Teifke
You’re taking advantage of. And I still I’m still like, even with what I’m doing right now, I’m like, how do I how do I make sure I’m getting as good of a deal as anybody possibly can?

00:25:35:01 – 00:25:53:01
Rod Khleif
Well, you’re going to know when you walk to units. I mean, if they’re trashed and you have a huge CapEx budget that you’ve got to come in with, that could be a piece, right? Maybe that’s why they’re not rented. Maybe they’re destroyed. So who knows? You know what? You’re going to encounter once you do your walks. But, so, yeah, but but it sounds sounds fantastic, honestly.

00:25:53:01 – 00:26:20:13
Rod Khleif
And it sounds like even doable in two years if you kick ass, and you know how to kick ass. So, by the way, you know, I’m just I’m still, I’m honored. And humbled that you joined the warrior program with with the level of experience that you have. You’ve got a degree in real estate. You know, you’ve got a real estate brokerage, you’ve got a property management company, and we get people like you, on a fairly regular basis, people that have had a thousand units and so on and so forth.

00:26:20:13 – 00:26:46:19
Rod Khleif
But I’m I’m honored and humbled. And by the way, if you’re listening and you are interested in applying to our program, text the word crush to seven, two, three, 4 or 5. That’s how you apply, and we’ll help you crush it in this business. You know, like I say, I think my students now on upwards of 300,000 multifamily units tons and you know, this Mac, because you’ve been in the group, tons of senior housing, tons of, you know, mobile home park, self-storage, student housing, you name it.

00:26:46:21 – 00:26:49:10
Rod Khleif
What other asset classes are you in personally?

00:26:49:12 – 00:27:16:20
Matt Teifke
Retail? RV park, mobile home and so. Well, and I’ll tell you Rob, just to rod to build off of this like, look, I’m not I’m not getting paid to bring people to the community, but I really I really believe this. Like, you have to get around people. Right. And if you’re not in a group like this, then you’ll, you’ll go through, you know, ten, 20 meetings to find one person that’s serious.

00:27:16:23 – 00:27:21:21
Matt Teifke
Whereas if you just come here, they’re already there. So I don’t know if this is a good sell.

00:27:21:22 – 00:27:24:11
Rod Khleif
Thousands, thousands are there. Yes.

00:27:24:13 – 00:27:38:14
Matt Teifke
And like for some people this resonates. I said it once. I double down on it, but it’s like if you the quicker you find out if you have what it takes, the better. And if you like, when you do your events and there’s, you know, 300 people in a room.

00:27:38:16 – 00:27:43:00
Rod Khleif
If you thousand. But yeah, let’s say this can feel like.

00:27:43:02 – 00:27:55:15
Matt Teifke
Like if you can’t go in that room and, and capture value and create value, then you’re not going to be able to do it in real estate, in general. And so the quicker to figure that out the better. Like, yeah.

00:27:55:17 – 00:28:14:16
Rod Khleif
Don’t discourage people because I’ll tell you guys, you know, we get a lot of people that are tentative and they’re afraid and introverted. Maybe even I’m going to tell you, there are a lot of different hats you can wear in this business. And some of my most successful students are the ones that really have a tough time going and shaking hands, but they do incredible analysis.

00:28:14:20 – 00:28:17:01
Rod Khleif
So, you know. Yeah. So, so, so.

00:28:17:02 – 00:28:24:11
Matt Teifke
What I’m saying is like, but like if you know that that’s your role, then you’ll go find the people to do analysis for.

00:28:24:12 – 00:28:28:18
Rod Khleif
And that need that need that help. Yeah. That need that help. Got it. Yeah.

00:28:28:20 – 00:28:44:10
Mark Nagy
So what are some of the other things you’re looking for? Man I know you posted about this in the warrior group the other day of the quote unquote reset cycle that we’re in. And, you know, I think Texas and Florida still have a few more months to go. I think parts of the Midwest and Northeast are probably already on the recovery.

00:28:44:10 – 00:29:00:12
Mark Nagy
But, you know, you mentioned one thing to look for in terms of distressed management on that deal. What are some of the other things that you’re looking for right now, or maybe in the next six months on deals where, that these are going to be great deals to buy the opportunity.

00:29:00:14 – 00:29:24:12
Matt Teifke
Then, the bigger the better. Right now. Like, this is my friendly, in my opinion. I mean, look, four years ago, five years ago, three years ago, if I wanted to buy some of these big deals, I’d be at the bottom of the list, right now. I actually have control of these deals. And as I’m closing them, that’s changing.

00:29:24:14 – 00:29:32:17
Matt Teifke
But if I didn’t make this step up in this market environment, when the when the thing turns, I would have stayed at the bottom of the list.

00:29:32:19 – 00:29:53:16
Rod Khleif
So that’s really, really good advice. I just want to hammer that for a second. So basically brokers and sellers are much more receptive to taking you seriously because a lot of, you know, there’s not as much competition. Right now because a lot of a lot of operators are getting their asses kicked because they bought in 21, 22. They overpaid.

00:29:53:21 – 00:30:12:00
Rod Khleif
They have they have crappy debt with adjustable rate. Interest is incredible opportunity right now. I mean, incredible opportunity hitting. And there’s $1 trillion worth of debt that’s hitting by the end of this year total, which if you want to be blown away by how much money a trillion is, go, go look at the difference between a million, a billion and a trillion.

00:30:12:00 – 00:30:27:21
Rod Khleif
It’ll blow your mind. But, so there’s this incredible opportunity. So I love what you said. Now, if there was ever a time to level up, it’s right now. And and, you know, and I ask people in my podcast, you know, that have had thousands of units, you know, if you tell a ten year old sell something, what might you do differently?

00:30:28:00 – 00:30:45:16
Rod Khleif
Because I want them to hear the answer for I want my, my, my listeners to hear the answer from them instead of for me, it’s always go bigger, faster. But now there’s an opportunity to go bigger, faster. Yeah. So so if there’s a time to get up to frickin speed in this business, it is right now. So yeah, I love it.

00:30:45:18 – 00:30:54:19
Matt Teifke
And on that point, like you right now, you can go call brokers. Their their phones are ringing the way they were five.

00:30:54:20 – 00:31:01:09
Rod Khleif
Oh, yeah. They didn’t even. You can get the time of day. Back in the day, they were the belle of the ball. Now they answer their frickin phones.

00:31:01:10 – 00:31:22:03
Matt Teifke
Oh, here’s the point. So if you don’t if you don’t call them right now and you don’t get known by them, right? I mean, there’s different aspects, like, like you said asset manager capital raise or deal finder. But if you want to be a deal finder and you can’t call ten brokers right now and they know who you are, that’s a problem.

00:31:22:05 – 00:31:43:19
Matt Teifke
And if you if you aren’t calling them and getting known and getting on their list when things turn, they’re not going to answer your phone call. So so this is even to that point as well leveling up on the relationship side. You’ve got to like understand the, you know, real estate’s about location and timing. But like what’s the opportunity within the market where we’re at right now.

00:31:43:20 – 00:32:02:18
Rod Khleif
Macro macro economic cycle. And that’s super important. Yeah. I mean, brokers were the belle of the ball. Like I said, you’d be lucky to get them on the phone. They were closing deals hand over fist and sales are down 90% right now. They’re struggling and they don’t get paid unless deals close. So yeah, this is this is the time.

00:32:02:23 – 00:32:14:11
Rod Khleif
So again, if you’re listening and you’re on the freaking sidelines, you know, get your ass to one of my boot camps or text crush to 72345. And we’ll get you started because now is the time.

00:32:14:13 – 00:32:37:17
Mark Nagy
So Matt, what what are the things I, as an operator going and you’re buying some of these distressed deals again for the listeners, what are the things that you think should be focused on in these deals over the next two, three, 4 or 5 years to really get these properties to where they need to be. What skill sets do I need as a new investor to really make sure my properties perform well?

00:32:37:19 – 00:33:03:15
Matt Teifke
Number one, the motivation is is huge, right? Like, do you really have this is my perspective. The last two deals I closed the big ones. The seller brought money to the table to sell it to us both times. So we so we totally maxed out the numbers. And then as rod mentioned, man, like once you own this thing, you got to be hyper focused or have somebody on your team that’s hyper focused on every aspect of the deal.

00:33:03:18 – 00:33:22:10
Matt Teifke
Like that’s a whole business now you’re running a business every single day. But what I look for high level is, am I buying it at a discount to what people paid for 4 or 5 years ago? Am I buying it to a discount of replacement cost? And does it cash flow immediately?

00:33:22:16 – 00:33:39:06
Rod Khleif
And the third one is the most important. Yeah. Cash flow is everything. Yeah. Right. And I’ve got a I’ve got an asset that sold for 43 million. I could buy right now for 28 next to one I own. I’m not buying it unless it goes lower. So it’s all about cash flow. Okay. I just want to I want to hammer that point.

00:33:39:06 – 00:33:39:16
Rod Khleif
Okay.

00:33:39:16 – 00:33:55:04
Matt Teifke
Yeah. I mean, that’s how we make money, right? And, for me, you know, I’d love to hear your honest opinion because and I’ll take notes on this from you guys. But like, when everyone’s always saying, what’s the exit? The first thing that comes to my mind is there is no exit.

00:33:55:04 – 00:34:07:08
Rod Khleif
I’m buying. I love it, I love it, I mean, I hate everything, I hate every fucking property I’ve ever sold. Except for ones that are in crappy areas. I will tell you, I regret every property I’ve ever sold unless it’s in a bad area.

00:34:07:11 – 00:34:14:05
Matt Teifke
I’m so glad you said that. Because I love exit. I’m going to sell it to go try to buy something else. There’s no that’s it now.

00:34:14:07 – 00:34:18:21
Rod Khleif
Or refinance it and buy something else. You know, get your investors or money back.

00:34:18:23 – 00:34:35:10
Mark Nagy
Yeah, I want to put in a quick opinion on that as well of one thing that we’ve done that has our investors have actually really liked is sometimes we project like, let’s say a five year exit, right? Because investors sometimes what their money back out right at some point. But maybe as real estate investors we don’t want to do that.

00:34:35:10 – 00:34:47:22
Mark Nagy
We want to refi. So what we’ll kind of do is we’ll kind of split the difference. So after 2 or 3 years we might refinance, get some of their money out. So they’ve got some of their money back and then reset that cycle.

00:34:48:00 – 00:34:49:05
Rod Khleif
Yeah it’s it’s a big.

00:34:49:07 – 00:34:51:23
Mark Nagy
It’s a big seven years. And it’s a win win for everybody.

00:34:51:23 – 00:35:09:07
Rod Khleif
It’s a big version of the BR method I mean that’s really what it is. Buy renovate refinance repeat give them some of their a some or all their money back and keep going. That’s our that’s our model. So Matt you’ve you’ve bought about 400 units since you joined the warrior program in 2025. Not that long ago. Let me ask you this.

00:35:09:07 – 00:35:12:01
Rod Khleif
Are you okay with listeners reaching out to you?

00:35:12:03 – 00:35:13:11
Matt Teifke
I’m here for men. I’d love it.

00:35:13:13 – 00:35:16:17
Rod Khleif
Okay, okay. What are the best ways for them to reach you?

00:35:16:19 – 00:35:23:12
Matt Teifke
I’m all over, man. Matt Typekit at gmail. I’m on LinkedIn. Instagram. Okay, perfect. Come join the program.

00:35:23:18 – 00:35:40:09
Rod Khleif
Yeah. There you go. Come join the program. That’s how you really get connected. Well, listen, brother, it’s great to see you. I know we’ll be talking again soon. Mark, it’s good to see you, brother. And, I appreciate it, I appreciate you, yeah. Oh, thanks. Yeah. I’m looking forward. I appreciate you guys. We’ll see you soon.

00:35:40:09 – 00:35:41:00
Rod Khleif
Take care.