Ep #465 – Trina Piceno – Multifamily Property Management
Understanding the risks with C and D Class Properties
- Physical vs Economic Vacancy
- Repositioning D class properties
- The value of legal representation
- Protecting you liabilities
- Understanding protected classes
- The importance of written communications
- Developing systemized processes
- Warrior program
To find out more about our guest click here.
Full Transcript Below
Ep #465 – Trina Piceno – Multifamily Property Management
Rod: Welcome to another edition of How to Build Lifetime Cashflow through Real Estate Investing. I’m Rod Khleif and I am thrilled you’re here. And I am super excited to interview my friend and warrior in my coaching program Trina Pisino. And I’ve almost messed up the name and Trina brings a ton of property management experience to the game. And we’ll let her tell you her story but that’s probably where we’re going to go with this. It’s property management and asset management but anyway let’s get going. Trina, welcome to the show!
Trina: Hi! Thank you.
Rod: Yeah so you if you wave, they can’t see it just so you know. You have to say it because more people listen to me on iTunes than watch on Youtube but anyway, welcome. Take a minute and talk a little bit more, expand on your background a little bit. I mean I know you’re in over 80 units right now and you know we’ll dig into that a little bit as well but talk a little bit about your background first
Trina: Yeah happy too… So ultimately about 10 years ago my husband and I moved back to California, exited the military. And my family we have a bunch of rental properties throughout California. So I needed to be able to you know assist my family with some of those rental properties. With that, my stepdad and I decided to get certified. We took a course California Apartment Owners Association has a great CCRM credential course. So that was kind of my baseline education but I really quickly saw that I’m not going to get any experience with our six stable doors you know I think one of them hasn’t turned over in the past six years. So not a lot of experience there. So I wanted to get my foot in the door with a real estate company that did property management just again if I’m going to do something, I want to know like on the ground how it’s going to operate. So I interned with Keller Williams. That led me to meeting my business partner, Wesley Olsen who has a real estate brokerage out here in California and he essentially had a pool of individuals who were investors, who just bought up a bunch of properties and needed someone to manage them. So me coming in to work with him has been great. He’s given me a lot of latitude to make decisions and see where we need to go. A majority of our portfolio ended up being D and C class properties just that’s where the margins were for profit in our area and that got me a lot of experience that was pretty eye-opening. Fortunately, I have a pretty eclectic background. I used to work in county jails. I used to be a Girl Scout Coordinator you know so I’m used to dealing with different personalities and overcoming challenges but that coupled with having the empowerment from Wesley to make decisions and see where things need to go was pretty great for my experience
Rod: Yeah Wesley was your partner in our warrior program and you guys are awesome. You guys make a great team as well. And so you got in the property management, did you had D-class assets which you know I push people not to do because I’ve had D-class assets and to me, I don’t know that they’re worth the effort but I know that these assets that you just bought fall into that C-, D category and so you know I think you would before we started recording you said you know you met somebody at one of my Chicago boot camp, who, a warrior that uh that you ended up doing a deal with, a 64 unit. And then you also got an 18 unit from him and that’s, those are the doors that you’re in and you’ve got both of those stabilized you said the 18 unit runs itself, the 64 unit, I was a damn near empty when you guys got it, wasn’t it?
Trina: Well the economic vacancy was very high but we were at about 90% physically, our occupancy, yeah we could very easily see that they were stacking you know heads and beds to get a crime to sell
Rod: I thought I remember seeing a picture of the parking lot it was empty that’s why I thought I assumed it was empty but okay I was mistaken, well, so it was just it was physically occupied but not, by the way guys, the economic occupancy is who’s paying. Physical occupancy who’s living there. We don’t care about physical. We care about economic obviously. And so okay well, so you know what let’s go, I mean you know, let’s go into property management because that is to totally your superpower. I know that you sold your property management company here very recently and now you’re working with the company that bought your property management company which is very cool you said you’re very impressed with them. And so let’s talk about um some property management tips that you might give folks that are doing their own management. Maybe that’s a place to start. I’ll just let you go with it
Trina: Absolutely. So one of the things that I see a lot when people are starting to venture into this space or a similar space whether it be single family or any layer of investment is that the idea of managing yourself sounds very, I can do this, let me get my hands in the dirt. I think one thing that is very important to highlight on the front end, save you some pain and you know heartache is to align yourself with attorneys very early on. Get yourself involved in the various you know clubs that are out there the B&I groups, anything that you can learn the demographics and how things are working in your particular market as far as business. And then also just make sure that you are taking the approach with eyes wide open and protecting your liabilities. You are a landlord. That is your biggest liability is that you have a responsibility to maintaining a property safely and then effective communication. Fair housing is a really big deal. There are people out there who solely make a living off of suing people. They’ll just go from place to place and just sue people because it’s prime in that area. There’s lawyers that line up outside of courthouses waiting for someone to walk up and be available to speak to them for just five minutes so that they can now represent them against you in court
Rod: Yeah hold on let me stop you for a second. Let me stop you for one second yeah so about the professional litigators you know I’ve got friends, I got a friend that had am office warehouse space and somebody came and he was in the office and said, hey, can I use your bathroom? And he said yeah okay. And they let him use the bathroom and he got sued because it wasn’t ADA compliant okay by that person. And so guys you know, in this multi-family space, there are lots of protected classes, ones you may not really think about. And you know familial status, sexual orientation, things that you wouldn’t maybe think are protected but they are. And if you ask the wrong question you’re going to get sued if they you know and so very very important to be very careful and know what is discriminatory and what isn’t. And the bottom line is you literally, you just have to treat everyone the same that’s the overarching, would you agree with that Trina?
Trina: Absolutely. Personal characteristics can get you sued if you seem to have discriminated on personal characteristics which could be as simple as someone has a tattoo and they felt like you had treated them unfairly and there’s any layer that they can anchor onto. Yeah it’s pretty crazy out there
Rod: Yeah okay well I interrupted you please continue with your thoughts on property management. I just wanted to hammer that one home about discrimination. So many owners don’t realize that they’re walking around with a bull’s-eye on their forehead so okay
Trina: Yeah absolutely. Another thing is it sounds like you shouldn’t have to do this being that you have a written agreement like your rental contract but CYA is one of the biggest things. Every single thing that you communicate should be documented. I know a lot of people who are like, listen, I’m just gonna have a pleasant conversation with another reasonable human being to overcome this conflict and we’re going to get to a something that we both agree to. Okay, that’s amazing, have a conversation, overcome the challenge, but you better recap that in the email highlighting everything that is you have to bullet point everything, time and date stamp is best. If you have a CRM system that tracks all of that for you, that’s probably best too
Rod: Or property management software that you can attach the emails too. By the way, as an aside, yes really glad you said that but anytime guys, this is kind of an aside this is like off on a side road for a second. Anytime you’re working with a governmental agency as well really pretty much anybody in this business, a vendor or anything, you should always reduce a conversation to writing. Like she just said, but definitely if you’re working with the county or the city on something, reduce it to writing because it’s crazy how things get forgotten or manipulated or changed if you don’t. So all right so what else? CYA on the email, great idea
Trina: Yeah it also feels very impersonal to have canned answers or scripted answers. However, it’s the best thing to do because very clearly someone can identify that this is something that you say very commonly. It’s not personal, it’s just informational. So such as answering the phone because someone’s calling in because they want to see a property you know just making sure that you have the same verbiage or structure of your verbiage. And then two, written leasing standards gets a lot of people out of hot water when someone feels like they were unfairly treated based off of application standards. So you need to have your leasing standards in writing and ultimately what that is, is what your criteria is for screening people. You just want to make sure that that’s buttoned down and it’s black and white and if they qualify, they qualify. If they don’t, it’s something that they’ve self-certified and understood that they wouldn’t based off of the written leasing standards
Rod: Yeah that’s a really good idea as it relates to, particularly I mean where it’s critical is, I mean you should have it even if you’re a business of one but it’s absolutely you know imperative that you have it if there are other people working with you that are they’re communicating with residents that they sign off on those standards so that your you know, it mitigates your liability you know maybe not completely eliminates it but definitely mitigates it if something happens. So ADA stuff, I mean really discriminatory stuff. What else? Reduce everything to writing. Let’s talk about, you know one thing about the property management business is it’s very systemized. There’s so many you know so many things that you need to have checklists and systemize. Can you speak to that a little bit maybe?
Trina: Yeah one thing that was really great for me and just entering into the space um understanding that I had assets that did have giant targets on them on the D class side and on my families we’re going to call them B class but with that being the frame of reference and going into my initial education, being able to see that there are agencies out there that you can gain entire workbooks and packets. I mean you have an amazing workbook and packet that you offer at your boot camps that is just if you just take that and just make it a systemized process and just have your checks and balances every single time, again the goal is to make everything something that you can point to that is in writing that there’s no question about it. You do the same thing every single time. Another thing too just venturing into the proactivity side of property management is understanding your asset. If you know that you’re you have trees everywhere, don’t pretend that we are going to forget that every year you need to have the gutters cleaned you know get those kinds of systems in place too so that you’re not reactive you can be proactive. So that’s more on the business
Rod: Filters, AC filters. I just came from an asset that we took over the management of and I’ve got pictures of scores of blocked AC filters and we’re wondering why there’s an AC problem there. I mean, hello? That’s been yeah being proactive you know speak for a minute about our program. I mean you know I’m so excited that you know to have women on the show that you know to show other women what’s possible. Can you speak to your experience of the warrior program a little bit?
Trina: Yeah so I was actually introduced to the warrior program through my business partner Wesley. He was very motivated. He’s been listening to your podcast since pretty much they came out and the moment that he learned. He learned after your first um boot camp. He learned for the second one. LA was our first one that we went to and we went to the boot camp and he, understanding the subject matter and the end goal for what he wanted to accomplish, he was like Trina you have to come with me. You have to come with me. We’re going. It’s in our same state, he just started this. We have to go. So we go and I am not big, like I’ve been to a Tony Robbins event before and I really enjoyed it. There’s some aspects that maybe I didn’t feel like I needed to take away but I definitely took the lessons out of it and I was not understanding exactly what was going to happen at the boot camp. But the moment I went in there and started being able to just network with like-minded people who are in the industry and meet other operators who have war stories just like I do, I very quickly found that I’m not only valid in this space but I can grow on my education base because after being in an industry for so long and dealing with the same things for so long, you’re always, property management’s always going to throw you a little monkey wrench but you’re always wondering where can I continue to grow in my education base. So this was a great option for me to really expand. Now going into the warrior programs, you have a lot of aspects that you put into your program such as self-motivating you know overcoming internalized fears and things like that that really spoke to me because I have not understood what was wrong but now it’s called imposter syndrome that I understand and that’s because I never had a college degree. I’ve only learned things not the hard way but I’ve had to learn through experience and going through your program really helped me step outside of my comfort level to say that I can keep on growing from here. So it’s been extremely motivating to help me overcome things that I didn’t realize I was getting in my own way with. So thank you so much for that that. I really appreciated it
Rod: That’s very nice. You made my day with that. That’s beautiful. Thank you. So what’s next for you? Are you going to bring some more doors in? You’re looking for some more assets? I mean you’re you know and guys you know you she obviously came to this with some property management experience and you know which is a great precursor to this business. Finance degree is a great precursor anything in finance anything in any real estate at all it doesn’t have to be multi-family is great. If you’re a great networker you can bring money to deals. There’s just so many ways to do this business and bring in skill sets that you have. If you’re super analytical, that’s always needed. If you’re more outgoing and more of a people person that’s needed. So there’s just so many ways to step into this business that uh you know you don’t want to, don’t be afraid if you don’t have all the pieces because this business is absolutely a team sport like Trina’s got a partner. Wesley is a beautiful guy, super human being. And that’s why, and that’s how this business is done, is as a team sport. So what do you think, what’s been the, your favorite part of the business?
Trina: So my favorite part of the business and I’m gonna anchor on my property management experience but it does go into my asset management experience is a lot of people don’t know but I grew up on section 8 and welfare. And coming from that and still knowing like looking at my mom’s model of just working hard and never quitting and keeping on going and seeing where we got today has really been motivating but I know, so many people within those spaces that get very disheartened and you know there’s absolutely a stigma that’s attached when you do live in you know projects or subsidies or anything like that. So being able to work with those families and just be the person that shows up and says, it doesn’t matter you know what you look like or anything like that or what your income source is if you qualify you qualify, here comes a home. I still get handwritten colorings on the rent envelopes for families that we’ve leased to that are just absolutely grateful. We’ve helped people who were essentially being relocated from extremely violent areas just find a place to live. We worked with master lease programs and subsidy programs that a lot of people didn’t want to touch because we knew the actual risk that we were taking on with that. We’d be able to set some systems in place to overcome that risk but it meant that we weren’t eliminating those programs from our available options. So that’s been really really I guess like my passion project within that is working with um under service areas and
Rod: Nice what advice, what advice would you give women that are watching or listening to this that want to get into this business, haven’t taken action yet. What advice might you give them as a woman?
Trina: Well a lot of women that I do know that have come into this space are very educated. It doesn’t mean a college degree it means that they want to get their hands on as much information as possible. I’d say continue educating yourself but don’t be afraid to pull the trigger and it could be as simple as aligning with other people who are in the space where maybe you think they’re in the space more than you are. Just have conversations, have conversations explain what exactly you want to do and that actually is pulling the trigger to getting into the next step. So a lot of people are just shy and don’t want to burden someone but no, there’s so many people in this industry that have learned so much and are just excited to share that
Rod: It’s really about who you know, were there any mistakes or setbacks that that happened you know in your career so far that maybe set you up for future success that you learn from? Anything come to mind when I ask that one?
Trina: Yes I feel like a lot as I mentioned, a lot of my lessons that I’ve learned through my experience have been because we’ve had to overcome something. I think that there’s a lot of times where you want to see the positive outcome down the road but I have now become the break pumper in a lot of relationships that I’m in as far as you know professional people that I’m connected with where I want to see that visionary ideal. But I’m going to be the break pumper that says well here’s where I’ve learned a lesson here. Here’s where I’ve learned a lesson here. You can’t be the most optimistic person on the planet when you need to be realistic in some circumstances. But it doesn’t mean that you’re completely out of you know touch with where growth can be. So yeah just putting that realistic layer on things
Rod: Okay what do you think’s the best advice you’ve ever received?
Trina: Whooo okay… I was listening
Rod: I know I didn’t prepare you to do this
Trina: No that’s okay. Actually, I have one. I was listening to, I was just scrolling through Instagram one day and I was listening to a Gary Vaynerchuk link that was a young man explaining that he wanted to travel or something and he goes, well who pays for your life? And he says, my parents. And he says, well the moment that you get off their payroll then you can make your own decisions and so he, it really just signified like who’s signing your paychecks? Who’s paying for your life? Are you the one in control of paying for your own life or someone else? Like are you a W2 and they’re signing your paychecks? So I thought that was a really great eye-opener
Rod: Yeah no that’s good that’s good. Well listen, I really appreciate you being on the show Trina. It’s great to see your smiling face and I’m sure we’ll talk again really soon but thank you
Trina: Yes absolutely thank you!
Rod: All right take care
