Dave grew up in Maine and attended Carleton College in Minnesota, focusing on Latin American Studies and Environment and Technology Studies. After earning his MBA and spending 9 years in non- profit leadership and fundraising, Dave dove into real estate investing to make the world a healthier and happier place.
Here’s some of the topics we covered:
- Making Things Easier For Your Tenants
- High Efficiency In A Commercial Space
- Energy Saving
- Third Party Property Management
- Evicting Is Easier Than You Think
- Keeping a Good Reputation in The Business
To find out more about partnering or investing in a multifamily deal: Text Partner to 72345 or email Partner@RodKhleif.com
Full Transcript Below
Intro
Hi. My name is Rod Khleif and I’m the host of “The Lifetime Cash Flow Through Real Estate Investing” podcast. And every week, I interview Multifamily Rock Stars and we talk about how they built incredible wealth for themselves and their families through multifamily properties. So hit the “Like” and “Subscribe” buttons to get notified every Monday when a new episode comes out. Let’s get to it.
Rod
Welcome to another edition of how to build a “Lifetime Cash Flow Through Real Estate Investing”. I’m Rod Khleif, and I’m thrilled you’re here. I think you’re going to get a lot of value from the gentleman we’re interviewing today. His name is Dave Holman, and, you know, Dave owns commercial real estate, owns about 130 units, and he’s doing a 57-unit development. But we’re going to take the conversation in a different direction. So very excited to get into this. Dave, welcome to the show, buddy.
Dave
Thanks for having me, Rod.
Rod
Absolutely. So why don’t we start with just having, you know, you give us a little background on who you are and, you know, where you came from and why real estate? Just kind of bring us current.
Dave
Yeah, thanks. I grew up in Maine, middle-class background. You know, the only real estate I was involved with was our single-family home. You know, I went off to college in the Midwest, started learning about architecture, green building, you know, thought I might make a career of that. But love drew me down to Bolivia in South America, where I met my then-girlfriend, now wife. We started a chain of retail stores down there. So I kind of got the entrepreneurial bug, came back up to the US to go to business school, which I thought was important, and turned out I just needed to learn Accounting. And then I got involved in nonprofit, leadership, management, fundraising. But during that time, you know, nonprofits are wonderful. Charity is great, but it’s not going to make you wealthy enough to provide a great life for your family. So I started investigating real estate investing on the side, partnered with family to buy a single-family home as an investment, and then pretty quickly, listen to podcasts like yours, read books, you know, got the bug, and we’re now up to about 172 units. So there’s been some recent progress even since I gave you the figures. So it’s been an exciting route.
Rod
Nice. Now, you’re actually building some units as well? Yes?
Dave
Yeah. It’s a new thing for me. But my best friend from college became a developer in Minneapolis. He’s done over 3000 units, so he’s kind of babysitting me. We’re partners in it together, and I’m learning a lot as we go. And for him, it’s funny. Talking about, you know, 50, 60 units is like a little tiny nothing. And to me, it’s a little daunting.
Rod
Sure. Where are you doing this?
Dave
A little bit North of Portland, Maine. A town called Brunswick.
Rod
Oh, very nice. Great market, obviously, for rents and whatnot. You were involved in nonprofits. So you have a giving heart, obviously. And, you know, you care about the environment. Talk about–you know, one of the things we said we’d talk about is really the environmental component as it relates to, you know, either existing or new construction. So maybe you can speak to that a little bit. If there are some things that you’re doing on this project or that you’ve done on assets that you’ve purchased, I’ll just let you take it away from there. What you might suggest and how, you know, recognizing that my listeners are existing, you know, multifamily owners, some small, some large, and of course, a lot of aspiring multifamily investors as well. But maybe speak to the environmental component.
Dave
Absolutely. You know, I come from a, you know, environmentalist sort of background. But the beauty of this in real estate is that you cannot care about the environment at all. And it still is in your best interest to do a lot of these things because it’s about NOI and cash flow. And if you’re wasting energy in any way, that’s generally bad and can be improved upon. So most, you know, landlords, our biggest expense is taxes. And the number two is probably going to be heating cooling you know unless you’re in that sweet spot of the country where you’re 50 to 60 degrees all year round or something. But, you know, up here in the North East, you know, we have massive heating needs in the winter, and those are often met through very inefficient old systems that have been in place 30, 40, 50 years. They’re often systems that the landlord is paying. And, you know, the first kind of play in my playbook, you know, as a landlord is to evaluate the heating system and see is there a way that I can go from this big, centralized oil burning or even natural gas burning system to electric heat pumps? And we would do that for a couple of reasons. One is if the landlord is paying the heat, if you go to electric heat pumps, most tenants are paying their electric bill, and you at least have the option of transferring you know, that responsibility to them. And you can actually lower their monthly rent a little bit if you do that. And that’s often a win-win because I guarantee you, every building where the landlord pays heat in the Northeast, you’re going to see an open window in February. You know, you’re going to see waste happening in goofy situations. If they pay that heating bill, those windows get closed. So that’s, you know, kind of a win-win situation. Heat pumps, they also filter the air and they provide AC in the summers. You know, our summers are slowly getting hotter and hotter. And, you know, anywhere in the Southwest, I don’t need to, you know, talk about the importance of cooling. So it’s a great amenity for tenants. It’s a great new technology that’s been improving quite a lot recently. People have a negative stereotype about electric heating because you know, electric baseboard, resistance heating is quite inefficient. There was a lot of it installed in the 70s, and then people got whacked with high electric bills. That is not what we’re talking about. Heat pumps are about three times more efficient than baseboard, and they’re getting better you know, every year. So it really is a neat technological wave. And a lot of the old school HVAC folks, I mean, they’re not installing new oil systems or they’re not recommending it anyway. And nothing runs without electricity. Your oil, your natural gas, all that it gets shut off if you don’t have electricity. So, you know, you might as well go electric. And that applies to other building systems, too, beyond just the heating.
Rod
What about gas forced air? You know, I grew up in– You know, I had 1000 units in Denver at one point, and it was all gas forced-air there. Now, you know, if I got a property and it wasn’t vented out to a particular room, I threw up those crappy baseboard electric heaters. And you’re right, they don’t work very well, at all. But, you know, I very rarely ever saw a heat pump. And so I’m just curious as to the efficiency related to something like the gas forced air.
Dave
Yeah. Depending on whose stats you believe, heat pumps are like 10% to 20% cheaper to operate, you know, per BTU delivered you know from natural gas. Although now, with the current geopolitical climate, they’re probably 100% cheaper to operate.
Rod
Right.
Dave
Maybe by the time this airs, that will have changed. But, you know, I think heat pumps are a good solution for a lot of buildings, but not all of them. You know, and the bigger the building, the harder that transition is going to be. And the industrial-scale heat pumps are still young, you know, and there are heat pump systems that are geared towards large applications and large buildings. But that’s sort of the utopia to me where we ought to be driving at is can we remove a natural gas system that heated 1000 units and replace it with a high-efficiency heat pump system in an industrial setting, commercial setting. You know, those systems, I’ve heard about them. I haven’t used any yet myself. But I do think that’s the future. I don’t think a lot of installers 20 years from now are going to be talking about natural gas.
Rod
Interesting. Okay. Yeah. You talked about business school, and I meant to circle back on that. And, you know, don’t get me started on, you know, those professors in business school never owned a business or built a business. And yeah, you learned accounting, which is great. You need to know how to read a PNL, and you need to know how to read a balance sheet. But you’re absolutely right. You know, other than maybe a business model, you know, creating a business model or something like that, there’s so little else that you learn, unless you go somewhere like Harvard or something where they’re doing case studies and all sorts of cool things like that. But yeah, got it. All right. So, besides the heat pumps, are there any other energy-saving strategies? I know what we do. I’d love to hear it from you.
Dave
Yeah, absolutely. There’s a lot of lower hanging fruit even than heat pumps. You know, people think solar is the way to go. That’s the most expensive, highest-hanging fruit. And I’m not against solar by any means, but the basics are insulation.
Rod
Right.
Dave
You know, If you’re a landlord paying heat, you got to look at your insulation. And even with tenants, you know, it’s often just the right thing to do.
Rod
Air as well, by the way. It’s not just the heat, by the way. Air as well. Insulation matters there, too. Sorry I interrupted. Please continue.
Dave
Oh, all good. Yeah. So, you know, environments that need heating, a lot of times, basements are not well insulated, and that can be a source of pipes freezing. You’re wasting a lot of heat. A lot of times they’ll have actual heating units in the basement just to keep pipes from freezing. I’ve decommissioned those in buildings, saving thousands of dollars of oil a year that was heating a basement. All you need to do is put in spray foam around those basement walls. It’s a one-time expense with like 100% ROI per year when you do that in a lot of cases. So that’s a great tool to use in attics and basements, look at the insulation there. Another one is water efficiency. You know, make sure that you’ve got Aerators on your faucets, that you’ve got low flow showerheads. You’ve got, you know, the 1.28-gallon toilets or the dual flush. Those five-gallon toilets, man, especially when one of them breaks and starts flowing, I mean, that can be a $1,000 problem. One toilet in one month can charge you a lot of money. So, you know, paying attention to the number one and number two, business is important.
Rod
Yeah, no, what he means by when it breaks is if they just continually runs, if it’s not stopping itself. And, yeah, that happens in your home, even. You know, what about lighting?
Dave
Yeah, we just did a huge retrofit in a building where we switched 17,000 square foot building from all Halogen. This is an office building we own to all LEDs. And we actually got a big incentive from a state entity to do that. And there are a lot of states where you can get the grant money you know or low-interest loans and stuff like that to do energy upgrades. So we got like, 20% of the project paid for, you know, by this greenhouse gas initiative that we have in the Northeast. But just the operating costs alone, you know, that’s a property where we’re paying the electric bill, you know, and it’s triple netted out to some of the tenants, but the little officeholders, you know, we just include it. So it’s totally in our benefit to reduce that bill. And that’s like, you know, multi-thousands of dollars a year savings. You know, it’s a high ROI project. You got to think, okay, is this like, you know, a 20% ROI? I’m getting my money back in five years? If you’re owning a building long-term, that’s a phenomenal thing to do.
Rod
Sure it is. You bet it is. Yeah. Guys, it really adds up. You don’t think, you know, like, an LED light bulb makes a difference, but when you’ve got a ton of them, it absolutely does. I know that, I guess we would call vertically integrated. Even though you don’t have a huge portfolio, you’re managing yourself. Why? Number one. You know, let’s start with why.
Dave
Well, I’ve kind of been an A student most of my life, or at least A’s and B’s. And I don’t like getting C’s and B’s, which is what my managers were getting. You know, my units would go vacant for weeks at a time, and I had the sneaking suspicion that they were placing other people, my tenants, and other people’s units, you know. And it was a tough situation. I went from one manager to one that I thought was better. And I had kind of heard on podcasts like yours that a lot of times, you know if you want it done right and you’re particular, you sometimes have to do it yourself. And that doesn’t mean you’re personally interacting with all the tenants, doing that kind of tactical groundwork on a large scale. But it at least means if you’re going to manage the manager, they should be your employee, you know, they should report to you, or you should find a really Dynamite third party. I’m not an anti-third-party manager. We manage for some other folks as well.
Rod
Oh, you do? Okay.
Dave
Yeah. But you have to be careful and make sure that they’re not playing favorites or, you know, giving you a stick.
Rod
Yeah. I will tell you, while I’m thinking about it, I have a great resource of the questions that you should ask a– how to hire a third-party property management company. And I’ll have to look and see how to get it. Just give me a minute and I’ll give you guys the thing to text to get it. Actually, I know what it is. It’s management. Text “MANAGEMENT” to “72345”. And it’s got every possible question I could think of to ask a management company. And I’m going to tell you, guys, you know I’m sorry to steal the thunder here for a minute, but I’m going to tell you guys that we probably learn more about a market or a submarket by the questions we ask the boots on the ground property management company than just about anything else we do, you know. And so it’s an incredible way to really get up to speed quickly on a submarket. Now, you manage for other people as well. And another thing I want to mention on this topic, what is the average size? If there is an average size of your assets. Are they, you know, smaller stuff? Is it larger? Is it a mix of all between? Can you speak to that for a moment?
Dave
Sure.
Rod
There’s a point I want to make on this.
Dave
Yes. It’s a range because one of my sort of unusual things is that I never sell and I’ve never sold. So I have the single families that I started out with, and, you know, we’re doing you know, usually ten to 30,000 square foot buildings right now. So that could be ten to 30 units.
Rod
Okay. And the reason I bring that up is in these smaller multifamily management companies, very often, it’s a real estate broker that decided to start a management company, or, you know, it’s less sophisticated than in the world that I live in right now, which is 150 units plus where the management company has its own marketing division and so on and so forth. Not saying that they’re better because we have blown out management companies, got a problem with one I really felt good about. Now as well. But all in all, like I say, you’ll kiss a lot of frogs if you’re dealing with the management companies that are in the smaller assets. Very often, that’s been my experience. And sometimes they’re great, sometimes they’re really bad, and of course, everything in between. So you experience that yourself, Dave. And very often as well, you know they’ll be secondary gain that they may own assets. And if they own assets near your assets, you can see the obvious conflict of interest, right?
Dave
Exactly. Yeah. You got to be careful. And to me, I think the key thing is to look at the leadership, look at the relationship, the way, you know that they behave, and you’ve got to stay on them. Even if you trust them, you’ve got to keep interacting and doing you know, reporting and due diligence. I wouldn’t make it monthly. I would make it at least weekly that you’re in touch.
Rod
Right. And if you’re dealing with a management company that’s dealing in you know, under 50 unit assets, you’re going to be relying on their maintenance infrastructure and maintenance can be a real profit center for a management company as well. You know, they’ll hire some kid out, hire them at $15 and bill them out at $100. Have you experienced that as well, Dave?
Dave
Yeah, a little bit. And what we do, you know, in our company is we are purely administrative. You know we do very little physical labor. We work directly with third-party contractors. You know, we haven’t in sourced it and then build that up.
Rod
Okay. Yeah. Because sometimes they’ll also upcharge contract labor as well, you know, again, because there’s profit-centric, you might get a great management fee. It looks really great, but then they’re supplementing that with other things. The other thing I would caution on management companies is to make sure they’re not a digital dinosaurs. There are still some management companies that have not embraced technology. And by God, you better be able to do a tour of your asset online. You better be able to, at the very least be able to apply and put in a rental application online you know, and hopefully have a lot of information about your asset there on their website. So you just make sure they’re not a digital dinosaur, because there are still some of those out there.
Dave
Terrific point. That was the reason we transitioned off, basically both of them. They couldn’t handle you know, what was then cozy, and they certainly couldn’t handle you know, Buildium or AppFolio, which is the one we now use.
Rod
Nice. So, you know, one of the questions that you wanted me to ask was about how you treat your residents and that’s a really important topic. So let’s dig into that. Talk about that a little.
Dave
Yeah. I’m sure we’ve all seen managers and landlords who treat them with a bit of disdain, and I don’t like that. And frankly, you should be screening so that you’re not placing tenants that you’re going to be disdainful of in the first place. But, you know, to me, this is a customer/client relationship. You know, where they are paying your mortgage, they are helping you get wealthy. They are giving you cash flow. You owe them really good service. You know when their stuff breaks and it’s your fault, no matter whose fault it is, you should fix it fast. I mean, if it’s their fault, maybe you’re going to bill them for it. You know, we really strive to be responsive. You know, I think 90% of good management means good communication is setting people’s expectations of when something is going to get fixed, how it’s going to go. You know, hiring good communicators. Nobody in our company has any management experience previously. They’re all great communicators. You know, they’re military veterans. They’re people who’ve been social workers. You know, they’re people that really can relate with the people we’re working with. And we call them residents. We don’t call them tenants if we can avoid it. You know, because we want them to stay long term. And consequently, you know our turnover rates in some cases are either nonexistent or very you know, slow and long, which is what you want.
Rod
Yeah. So guys, everything you said spot on– and really the overarching thing that you said, which is critical is the mindset piece where you’re not looking at them as anything other than a client, a customer, someone you need to take care of. And that’s just the truth of it. Now, you know you’ll get the ones that are just a complete pain in the you know what? That complain about everything. And, you know, that’s the thing I will tell you, in the management business, if you’re in the management business, you can burn out because you know, they don’t call you when they’re happy, especially if you’re third-party managing. You’ve got owners that don’t call you when they’re happy and tenants that don’t call you when you’re happy. And I’ve owned a management company for decades, and managers will burn out. But if you treat them right, if you fix something and you follow up and make sure they’re happy with it, that’s critical. Again, it’s communication, like you just said. So, you know, that absolutely is the case. And then like you said if you’re responsive you know, and I try to create like a family, like a community, you know. We’ll do community events at our assets. We’ll have people standing by the gate, handing them food for breakfast on the go kind of a thing. They’ll get a croissant or something on their way out of the complex. We’ll do popcorn in the leasing office. We’ll do parties at the pool. You know, all sorts of things. You know when I owned a lot of single-family and stuff, I would bring a big can of popcorn for the holidays. And give it to them. Just something to warm them up because your highest expense in this business guys, if you have never heard me say this, your biggest expense is turnover. Period. Nothing comes close to the expensive turnover. You know, I mean, obviously, except for taxes. But you agree with me, Dave?
Dave
Completely. Turnover, you know, if you lose a month, that’s 1/12 of your annual income for that unit. You know, that’s a big number.
Rod
Right.
Dave
And I think about it in terms of weeks, like each week might be $500 that you’re losing. How can you will that down to just a 48-hour painting and cleaning, you know, quick turnover? How can you do that?
Rod
And the impact on the value in this business as well. You take $500 and it’s an $8,500 decrease in value. That’s how big a deal it is. And it can even be more than that, actually, with cap rates as low as they are right now. So why did you decide on real estate? What did you do before? Oh, you said that already. But why did you decide on real estate?
Dave
Yeah. In short, my wife and I got pregnant. So I realized that I had to up my earning game a little bit. And I had done stock investing with some good success. But I started with a small enough you know, a nest egg of summer job earnings that I wasn’t going to live off my portfolio, no matter how lucky I got. And good stock investing involves a lot of luck. Whereas in real estate, you’re in the driver’s seat of that car. I mean, you can go where you want to go. You can work hard and paint you know in your spare time when you’re just starting out, you know. So I like the forced appreciation possibilities. I had this stereotype that all landlords are these greedy, unethical people. But I started thinking, wait a minute, if I could make you know other people’s houses greener and more energy-efficient and make money from it and have them be happy and have a better landlord in place. Like, what’s not to like about that? And it’s a model that you can just rinse and repeat over and over.
Rod
Very nice. You know, as you were acclimating into this business, did you have any epiphanies, any aha moments like, okay, now I get it, about that. I know I didn’t prepare you for that. Does anything come to mind when I asked that question?
Dave
Oh, totally. Yeah. Well, for one, I thought it was always going to be the end of the world if you have to evict a tenant. That’s always the worst thing ever. The first multifamily property I bought was right down the road from the college I was working at, Bowdoin College in Maine. I had this dirty little secret that while I was doing my full-time job, I had started my real estate investing career. And there was a lady there that was paying like half of the market rent, smoking and drinking in her unit, and it just wasn’t a good fit. And she didn’t have a lease, so I said, hey, I’m really sorry. I’m going to close in this building in a month, and I don’t think you’re going to like going up to market rent. So is there any way I can help you find another place and make this as easy of a transition as it could be? And I was expecting screaming or tears or, you know, the whole work. And she was like oh, yeah, I was expecting that. Yes, that’d be great, if you don’t mind helping. And it was easy. It was not a bad thing. And I’m not saying you should always look forward to evicting people or you know, do that without a good reason. But it doesn’t have to be the end of the world, especially again, if you give people time to plan their lives, you give advance notice, and you just approach it with a human touch, I think.
Rod
Did you help her financially to move?
Dave
I didn’t need to in that case, but I’ve certainly done that in many others. I always try to do cash for keys because it’s so much cheaper for you.
Rod
Absolutely.
Dave
To get that rent up quickly and give them $500 to get the rent up by 400. Well, in two months, you’re way ahead on that trade.
Rod
Right.
Dave
You know, so I certainly advocate that.
Rod
No, agreed. Agreed. Just the way you approached it was really cool. The way that you worded that conversation with her was really, I really like that. Yes, I’ve done cash for keys. Unfortunately, we’ve got an asset in Louisiana where there were really bad residents, I mean, like crazy residents. And I walked through there and I heard the music and there was a bullet hole in one of the windows. And I literally probably a little stupidly knocked on pounding on that door and said, hey, if you’re out in two days, I’ll give you $1,000. And they were out. And the two neighbors that were also a problem, same thing. I got all three of them out within a week. And best $3,000 I ever spent because you know residents were coming up, thank God you got rid of them and so on and so forth. It’s you know, a challenging asset. So let me ask you this. You know, I have a lot of aspiring investors on my show. You know, they want to do this business. They hear your story like, oh, man, I need to do that. Can you speak to them? Can you give them some words of wisdom?
Dave
Yeah. I think, you know overcoming your fear, you know, the analysis paralysis. At a certain point, you gotta just realize that if you just make one estate investment today, even a small single-family home, in 20 years, it’s not going to be worth less than it is now. Like, this is not a money-losing gamble kind of thing. I think it’s one of the safest asset classes, the safest kind of investment you can make. And then the other thing is to be a person who is worthy of being trusted especially if you want to work with investors. You know, honor your word. That is so critical, whether you’re a contractor or anything else. If you say you’re going to do it, do it and have a good communication with people. And that will take you so far in this business because you’ll develop a reputation. And right now it’s really hard for people in our area to get electricians and plumbers and contractors. And, you know, I can snap my fingers and have any of those people at a property in less than 24 hours. And the reason I can do that is because we pay them promptly and treat them well, and we throw a lot of business their way and we honor our agreements. We don’t haggle them down all the time, and consequently, we get good service. And I think that is the key to being a good manager is making sure that make paying your contractors a race against time. Be the person who pays them way faster than they expected because it’s really no skin off your back unless you’re completely strapped for cash. But it means a lot to them because a lot of times they have to hassle people, they hate that, they don’t want to be emailing out reminders. If you just pay them, as soon as that bill comes in, you’re going to have a loyal contractor helping you out when you know, the you know what hits the fan.
Rod
Yeah, really good advice. In fact, we’ve got the problem, the management company I was just talking about hasn’t been paying our bills on an asset that we have and they’re behind. We are raising you know what in a big way to get that fixed immediately because you know that kills your reputation. So let me ask you this. How long have you been doing real estate? Start to finish so far? Just give my listeners that, and then I have a question related to that.
Dave
I started this crazy business in 2011 as a passive investor. This best friend of mine from college had a family and friends deal called this thing called the Syndication, which I had no idea about back then. And he gave me this offer that seemed way too good to be true. They were going to make 20% a year you know if I gave him you know, some of the little money that I had saved up. But I trusted my friend. I knew he wouldn’t be connected with the Mob or, you know, Scamsters. So I said, sure. Even if they’re wrong and they only do half as well as they think, 10%. Hey, that’s a good return. I tried it out and getting those quarterly reports, learning about that whole process was sort of the beginning of my education. But I started passively while I had full-time jobs you know in the nonprofit world. And it was only years later that I, you know, partnered with family.
Rod
So how long have you been doing actively? There’s a reason I’m asking.
Dave
Actively?
Rod
Yes.
Dave
2013 was the first–
Rod
2013. Still a good bit. Okay, so nine years. Let me ask you and by the way, guys, we actually have an exciting asset, I think, coming to fruition. And if you are an accredited investor, text the word “PARTNER” to “72345” and get into our portal. At least register so when it comes up, we’ll let you know about it because I think it will subscribe quickly. Again, that’s “PARTNER” to “72345” if you’re accredited. But let me ask you this. You’ve been at it nine years, knowing what you know now, if you went back to nine years ago, is there anything you do differently?
Dave
Oh, well, timing-wise, you know, 2011, 2013, you want to max out every credit card, you want to buy everything you could possibly buy under the sun. But that’s sort of hindsight being 2020. I think, strategically speaking, I don’t have any real big regrets. You know I’m not like, oh, my gosh, I should have done X or Y you know, completely differently. But you know, I would say to myself like believe that this is the right path and you really can be your own boss. You can make your own way, and you can really help people by being a good landlord. That’s the other thing is landlording is not a high excellence field all the time. And if you do it excellently, I mean, you’re really making people’s lives better in a big way.
Rod
Yeah. And that’s a great segue into something I wanted to ask you about because you know, you obviously come from a philanthropic background. You worked for a nonprofit. I have been a nonprofit for 22 years now. And, you know, before we start recording, you talk about refugees. And it’s amazing to me what you told me. So I’d like you to tell my audience how you’ve helped refugees and how they play into what you do.
Dave
Yeah. I’ll tell you the story of the first family we helped, and we’ve done a bunch more since then. But in Maine, in the summer of 2018, I believe it was. We had a big influx of refugees from African countries who had come over the border. They had heard that this place up in the north called Maine was pretty welcoming. And there were other you know, immigrants from countries like Somalia that already lived here and we’re doing okay. So we had hundreds of them come up and they just overflowed the homeless shelters. And suddenly it was a crisis. And we used you know, the Portland basketball Stadium to house you know 300 families or people in the Expo. And it was on the front pages of the news. And I had a vacancy coming up. So I just recently reached out to the city of Portland and said, hey, if there’s any way that they could ever get rent paid or pay rent or someone could kind of help us out, you know I’m willing to, you know, not worry about the credit checks and stuff that we usually do because I know these people aren’t going to have a credit score.
Rod
Oh, sure.
Dave
And we’ll just give it a shot because my heart goes out, you know to these families. And I believe in the American dream. If people come here with nothing, I want to help them you know get somewhere through hard work, and you need a roof over your head to do that. So, you know, I got passed around between a couple of people. They connected me with the right person and said, well, we have a family that just got you know their green cards so they can actually work pretty soon that’s in a homeless shelter. They speak a little English you know from Rwanda. They’d be a good fit. And, you know, with this apartment, it was unfurnished. I just went on, you know, Facebook and my friends said, hey, we need donations of beds, dressers, and there was an outpouring of support because I think people really–they want to help tangibly. You know, giving money you know is one thing. But being able to be like oh, I have an extra dresser and my friend is asking for it. That’s real, you know. And so we kind of weirdly outfitted this apartment for them. They moved in. We showed them the local food pantry. We helped them get a job at the college where I worked in the dish room. Before you knew it, they only needed the rental assistance for two months before they got kicked off because they were earning too much money and they were paying their own market rent. And they have been our best tenants. They’ve upgraded to a bigger apartment. They had a second baby. And guess what? They now were talking about renting a three-unit apartment you know, for $2,000 a month. And I said, you know, buddy, I’m a broker. Let me help you buy something because, for that much a month, there’s the FHA program. I think you could be a good candidate. You’ve got a good credit score now that you’ve built up a couple of years of track record. And I would love to fire a tenant if I can help them get their first home, you know. That, to me, is just more important than retaining them for however long to keep paying rent, you know. That’s one story that we’re really proud of. We started taking other families, too.
Rod
That’s so cool, brother. My hats off to you, man. I mean, that is really, really cool. Well, listen, I really appreciate you coming on the show, Dave. It’s been a real breath of fresh air. I very much enjoyed this interview, and it’s very much my pleasure to meet you, and I hope we stay in touch, my friend.
Dave
You too, Rod. Keep up the great work. Thanks a lot.
Rod
Thank you. Thank you.
Outro
Rod, I know a lot of our listeners are wanting to take their multifamily investing business to the next level. Now, I know you’ve been hard at work helping our warrior students do just that, using our “ACT” methodology, which is Awareness, Close, and Transform. Can you explain to the listeners how they can get our help?
Rod
You bet. Guys, we’ve been going nonstop for three years building an amazing community of like-minded people. And our coaching students, which we call our warriors, have had extraordinary results. They’ve purchased thousands and thousands of units. And last year we did over 1000 units with our students and we’re looking to grow this group and take it to the next level. We’re looking for people who want to follow a proven framework that’s really step by step and then leverage our systems and network to raise equity, to find and close deals, and to build partnerships nationwide. Now, our warrior community is finding success in any market cycle. So if you’re interested in finding out more about how you can become more of our incredible network and take advantage of the incredible opportunities that are coming very soon, apply to work with us at “MentorWithRod.com” or text “CRUSH” to “72345” and we’ll set up a call so you can check us out and we can check you out. That’s “MentorWithRod.com” or text “CRUSH” to “72345”.
