Morgan Keim spent a decade launching food tech startups and raising $400M, only to realize that income without ownership was not true freedom. What began in 2014 as a quiet hedge against startup volatility grew into a full-time mission as he placed over 50 LP checks and then led two dozen contrarian acquisitions across the Midwest and Sunbelt. With 105 percent net investor returns across seven exits, he has transformed overlooked Class C properties into safe communities and stable cash flow. Today, as Managing Partner of Ocean Ridge Capital, Morgan helps founders and operators trade burnout for lasting wealth while tackling America’s housing crisis.

Here’s some of the topics we covered:

  • Breaking Free From Limiting Beliefs And Owning Your Path
  • From Digital Marketing Hustle To Real Estate Empire Builder
  • The Cash For Keys Strategy That Changes The Game
  • The Hidden Struggles Of Affordable Housing No One Talks About
  • Inside Morgan’s Playbook For Managing A Full Rehab
  • The Must-Know Advice Every New Real Estate Investor Needs
  • How Morgan Builds Power Teams That Actually Deliver
  • The Two Asset Classes Morgan Can’t Stop Investing In
  • Unlocking Your True Strengths And Leveraging Them For Success
  • The Silver Tsunami That Will Disrupt Senior Housing Over The Next Decade

To find out more about partnering or investing in a multifamily deal: Text Partner to 72345 or email Partner@RodKhleif.com

Full Transcript Below

01:20:07:27 – 01:20:26:27
Rod
Welcome back to lifetime cash flow to real estate investing. I’m Rod Khleif, and I am thrilled that you’re here. And, I know you’re going to enjoy today’s conversation. I’ve got Morgan Keim here, who’s I’m blessed to say flew all the way from the West Coast to be on the show. And, he’s a real dynamic guy, and I’m really looking forward to this conversation.

01:20:26:28 – 01:20:27:23
Rod
Welcome to the show, bro.

01:20:27:26 – 01:20:28:23
Morgan
Hey, great to be here.

01:20:28:23 – 01:20:48:03
Rod
Rad. Thank you. Thank you. So, yeah, you know, I, I read your bio, and I’m not even going to try to attack it because it’s, it’s it’s very interesting. And, and I think I’d rather you shared your story with us because, it looks like you had some epiphanies and, and as part of your process.

01:20:48:03 – 01:20:51:05
Rod
So. Yeah. Why don’t you tell us who you are and why? Real estate.

01:20:51:07 – 01:21:16:03
Morgan
Yeah. Now, my story is a very nontraditional one, right? You know, I, I, I’ve been focused mainly on elevating the standard of affordable housing and helping to create lasting wealth for entrepreneurial investors at Ocean Ridge. And I’ve done you know, 100 different deals between LP and GP. So really a kind of a 5050 split down the fairway. But a lot of this really is almost by accident.

01:21:16:05 – 01:21:26:20
Morgan
I stumbled into real estate. It wasn’t my primary path and it happened out of necessity, you know, maybe say like necessity is the mother of invention, right? That’s how this all kind of landed for me.

01:21:26:23 – 01:21:28:12
Rod
So, so elaborate on that, please.

01:21:28:13 – 01:21:46:15
Morgan
Yeah. So let me back up a little bit and I’ll give a little of the backstory. Yeah. I’m a New England kid, grew up in, you know, kind of middle class household focused on much more traditional path type of stuff. You know, get a good job, you know, go to good school and then ultimately work that job for the rest of your life.

01:21:46:15 – 01:22:10:03
Morgan
Maybe you’ll get a pension, that kind of thing. Retire, max out the four. Okay. And that had some benefits, right. Delaying gratification, learning how to, you know, invest in something for the long term. It also had some drawbacks, right. Some scarcity mentality, things like that. And even though we grew up, you know, relatively comfortable, it was, it was it was it was a lot of like limiting beliefs that I had to sort of face as I followed into my life.

01:22:10:08 – 01:22:47:03
Morgan
Did go to the schools, did try to get the job, graduate in the financial crisis and realized I’m going to get punched in the face. I’m not getting employed. Right. Justin just really quickly had to learn early on that that path wasn’t going to make sense for me. And so I, by necessity, faced a path of entrepreneurial, drive essentially my first job out of college was starting a consulting firm focused on digital marketing and really like leaning into delivering value to a whole clientele, in a, in a scrappy, entrepreneurial way, because I couldn’t find another way to, to get in.

01:22:47:08 – 01:23:04:11
Morgan
And I always knew that I wanted this fabric of having conscious capitalism as a key vehicle for what I did. And so I had done this for about a year, was eventually hired by a company, and brought out to the West Coast to do this for large scale brands.

01:23:04:13 – 01:23:06:11
Rod
And I was a digital marketing digital market.

01:23:06:11 – 01:23:24:15
Morgan
Gotcha. And eventually got seduced by the Silicon Beach kind of lifestyle of Santa Monica, California. And so I started a career in startups, really helping them build and scale. Now this is like off, like a rocket ship, high risk, high reward, but very, very, very high chance of failure type stuff.

01:23:24:16 – 01:23:31:17
Rod
Did you stay I mean, did you did you bring marketing to this, to startups? Okay. Got curious what you did because I know you raised money as well.

01:23:31:17 – 01:23:53:06
Morgan
So you got it marketing, which eventually, based out of need, became fundraising for for startups because I found that marketing was like a B-list type of thing, but they really need sales and funding to get off the ground. Right. And so I start this career in startups, particularly in the food tech, in the climate tech arena. And I’m renting a property in Santa Monica, California.

01:23:53:09 – 01:24:00:14
Morgan
While I’m going through my career. This property sells. It changes hands. It’s like, like a quad type of situation for units.

01:24:00:16 – 01:24:02:06
Rod
And you own the whole fourplex or just.

01:24:02:06 – 01:24:18:20
Morgan
I didn’t own it that some, some other investor group had had transacted it and they made like a million bucks, I see, and I am now writing checks to a different landlord. Right. Okay. But it sort of woke me up a little bit. And I said, we these guys just made so much money on this transaction. I’m paying their rent.

01:24:18:20 – 01:24:27:05
Morgan
Like, what? What happened and why am I not in that conversation? And I actively pursued these people because I realized.

01:24:27:05 – 01:24:27:22
Rod
People that bought.

01:24:27:22 – 01:24:29:09
Morgan
It, the people that sold.

01:24:29:09 – 01:24:29:21
Rod
Sold it.

01:24:29:21 – 01:24:49:26
Morgan
Got it. I actively pursued them as a sort of local syndicator group in Los Angeles because I realized at the time, well, I had this really high risk, high reward startup career on the side of my barbell, which could end in a big win. It could also has a high likelihood of not being right, and I don’t want to be a 1 in 10 butt of a venture capitalist.

01:24:50:02 – 01:25:06:26
Morgan
So I saw real estate as this other side of a barbell strategy. And so like for anybody listening, thinking about wealth allocation, right, you want to have diversification, but you don’t want to be all in on high risk. You also don’t really want to be all in on super safe, right. Not wealth advice, not a tax advisor.

01:25:06:26 – 01:25:28:15
Morgan
But that’s how I felt at that time. And so I pursue this group and I end up finding out what they do. It’s LA value add multifamily investments, small format type stuff, 10 to 30 units. They go in and LA is a tricky market. Mind you, we were just talking off camera, right? It’s it’s rent controlled. It’s it’s, you know, very tenant friendly.

01:25:28:15 – 01:25:35:18
Morgan
It’s a tough place to transact. But in the mid 20 tens when I was looking at this market and starting to do LP deals there.

01:25:35:21 – 01:25:39:00
Rod
Mid 20 tens, it had just been crushed.

01:25:39:02 – 01:25:44:29
Morgan
In the in the early part it had, but there were pockets of, of growth where the city was changing.

01:25:45:01 – 01:25:49:05
Rod
Well my point is the values were depressed. So there was opportunity for sure.

01:25:49:05 – 01:26:02:25
Morgan
Exactly. Right. And by working with a group that was very specialized in what they did in cash for keys, essentially incentivizing tenants to give up their lease so that they could improve the value of that property.

01:26:02:25 – 01:26:27:11
Rod
So, guys, let me explain what he’s talking about here. So they’ve got rent control there. And so what one of the strategies in California is you do cash for keys to get the tenants out. So you can re, you know, release it at market rates and, and and pay very large amounts of money to do that. So it’s a it’s a it’s a very unusual and unique strategy to, you know, a rent control, geographic area.

01:26:27:14 – 01:26:36:19
Morgan
Okay, absolutely. And honestly, if I knew what I knew now, I don’t know if I would have started that path. Right. But this was just core, imperfect action to learn as you go. Let’s.

01:26:36:21 – 01:26:47:16
Rod
Oh, great way to say it, by the way. I just want to I just want to salute you for what you just said. Guys, imperfect action is better than no action. Yes. And so no. I love the way you said that. Okay. Please continue.

01:26:47:17 – 01:27:02:17
Morgan
Thank you. So, so I, I, you know, do my diligence as best as I can. I’m probably the most active, passive investor of all time, but I end up basically scraping together the minimum to do my first LP check next to a graveyard in an area of Highland Park, which is like East L.A..

01:27:02:19 – 01:27:05:01
Rod
There’s jokes about that. You know, the neighbors aren’t noisy, right?

01:27:05:03 – 01:27:24:25
Morgan
It’s true. It’s a dying to be there. Right. And so we place it. I mean, this is like not on the vision board, right? Right. But, you know, these guys say it’s a good deal. Turns out the tenants love the green space. I love the quiet and the hustle and bustle of LA. And, you know, this property quietly doubles in value three years later, and we end up selling it for for a clip.

01:27:25:02 – 01:27:34:20
Morgan
Nice. And I repeat the process and sometimes I can’t even afford the minimum. I’m working on these startups, right? I’m taking whatever available cash I have. I’m rolling it into L.A..

01:27:34:20 – 01:27:37:07
Rod
Working both ends of the bar. Bill, like you said, exactly that.

01:27:37:07 – 01:27:47:12
Morgan
And sometimes I can’t afford it. Right. So I get a friend or two to join me on the minimum check size. My job to start, because I just want it to be in the game. I want to learn. And I’m asking every question in the book to try to learn this business.

01:27:47:12 – 01:28:01:17
Rod
So what he’s saying is, you know, these these these, general partners have minimums to become a limited partner in the deal. You know, like, like very common minimums today are 50 to $100,000. And if you can’t meet the minimum, they, you know, they don’t want to deal with it, but. That’s right.

01:28:01:23 – 01:28:08:06
Morgan
Yeah. That’s okay. So I start building this education now on the startup side of my life, things start to take off.

01:28:08:06 – 01:28:11:18
Rod
Nice. We by the way what is tech climate tech.

01:28:11:18 – 01:28:11:26
Morgan
Yeah.

01:28:11:27 – 01:28:12:29
Rod
So I have never heard.

01:28:12:29 – 01:28:19:20
Morgan
That my my niche was particularly being the business guy behind Scientific ventures that are evolving the food system.

01:28:19:22 – 01:28:25:01
Rod
Evolving the food system. Okay. So it relates to growth, growing, growing crops and things like that.

01:28:25:01 – 01:28:31:13
Morgan
Well, more so it relates to making animal free versions of meat, dairy and okay.

01:28:31:13 – 01:28:32:21
Rod
Okay, okay, okay.

01:28:32:27 – 01:28:55:28
Morgan
And so they’re very, very high tech ventures. We brought in, you know, venture capital, private equity, even pension fund money to help start these companies and grow them and scale them. And one of those companies really took off. It was started we helped to spin basically how to spin a company out of a parent company in Boston, which is a $90 million series A, and topped it off with another 30.

01:28:55:28 – 01:29:12:12
Morgan
Once a little bit of the team had been hired on and it was off to the races around, you know, they need they need me to help build this business and grow this business. And so I got very busy. I started ending up on flights from Southern California to Boston every week. Every other week. Wow. The JetBlue people knew my my first.

01:29:12:15 – 01:29:28:15
Morgan
I think I was on status like February 15th. Wow. You know, and I just started to realize that I was caught in the cycle of constantly being pushed to chase a goalpost that was so far out of sight for such a low likelihood of success. Where was.

01:29:28:15 – 01:29:29:00
Rod
Your family?

01:29:29:07 – 01:29:30:27
Morgan
My family’s in Southern California.

01:29:30:28 – 01:29:32:24
Rod
Okay, so you had to leave them every week.

01:29:32:24 – 01:29:52:01
Morgan
My wife is there now. I have two baby girls now. All of my friends are there. My community’s there, right. And I’m going to a different coast where I don’t know anybody. Right. To help build a company serving an existential mission? No, not a not an internal one as much. And there was a point where I caught myself on one of those flights.

01:29:52:03 – 01:30:07:10
Morgan
It was a Sunday. I had to fly the 141 LA to Boston. You. And in Boston, by the way, 10:00. It is not, healthy food. It you’re you’re you’re you’re you’re caught in a cycle there. You got to be there for the Monday morning meetings. And I remember we were taken off. I think it was like September.

01:30:07:10 – 01:30:22:21
Morgan
Most beautiful day in L.A.. Wife is at the beach, friends are at the beach. And I just had this, this gut check realization that I was going to be delaying gratification indefinitely, that I don’t even think I was living my own life. If anything, I’m I might have been living my dad’s.

01:30:22:21 – 01:30:24:06
Rod
Life interesting.

01:30:24:08 – 01:30:39:03
Morgan
And I didn’t want that. I didn’t want to delay gratification and say, you know, I wanted to live life on my terms, do business with people I want to do business with, on my time with, with my impact and really have it, have it be centric around what I can provide.

01:30:39:05 – 01:30:40:06
Rod

01:30:40:08 – 01:30:44:08
Morgan
And it hit me hard. It really hurt. But after I didn’t.

01:30:44:08 – 01:30:45:12
Rod
Trigger massive action.

01:30:45:19 – 01:31:03:27
Morgan
It did. Okay. It did. When I realized what that what I had to do basically to be successful wasn’t going to be what got me to that point. That quarter. I started looking in different markets saying, you know what? I’ve had really quiet success with these LP investments. I think I’d done 12 or 13 at that point.

01:31:04:00 – 01:31:07:20
Morgan
I had actually syndicated a few where I raised the full capital stack.

01:31:07:20 – 01:31:08:04
Rod
Oh, you did.

01:31:08:11 – 01:31:13:22
Morgan
Once, because they saw that I’d had success in the prior ones, and they said, well, I want to join you on the next one.

01:31:13:22 – 01:31:16:03
Rod
So you were the up, then you became the operator that.

01:31:16:06 – 01:31:17:02
Morgan
I became the capital.

01:31:17:02 – 01:31:18:10
Rod
Partner. Oh, just capital.

01:31:18:10 – 01:31:18:18
Morgan
Just the.

01:31:18:18 – 01:31:19:14
Rod
Capital part.

01:31:19:16 – 01:31:24:15
Morgan
But I decided after that flight I’m going to take this operation role. I’m going to do this myself.

01:31:24:21 – 01:31:25:27
Rod
Okay? Okay.

01:31:26:02 – 01:31:42:02
Morgan
And around that time, Covid rolls around. Yeah, I had just gone in contract and I thought, you know, I’m going to do the same thing. Cash your keys LA. We were in contract on an eight unit deal in LA in like a terrible neighborhood. It’s going to be a value add situation. Right. And I remember Covid comes around policy change.

01:31:42:02 – 01:32:11:06
Morgan
We we couldn’t exit that contract fast enough. Right. And thank goodness we did okay. But we start looking nationally. We end up doing a whole search and we end up landing in Cleveland, Ohio and saying, you know, a big part of our thesis is elevating the standard of affordable housing. How can we go where there are properties so far below replacement cost, where there’s tenant demand, where there’s a really good price to rent ratio, which I really looked for because I wanted to ultimately a cash flow bridge to get me.

01:32:11:09 – 01:32:15:13
Rod
Do you do this with a simple single digit, number?

01:32:15:16 – 01:32:27:12
Morgan
These are these are double digit. Double digit. Yeah. Because because at this time we could buy completely distressed properties, 15, $20,000 a door and turn them into to cash cow. Wow. Wow.

01:32:27:13 – 01:32:48:00
Rod
Right. Yeah. So that’s that’s those those are tough areas in Cleveland I yeah I mean, when I first got started, I could rent a property for 2% of what I paid for it. So I pay, you know, 20 grand. I can rent it for $400. Yeah. Which is very difficult, but it sounds like you’ve you’ve certainly could do that with those prices.

01:32:48:02 – 01:32:48:12
Rod
Yeah.

01:32:48:15 – 01:32:50:00
Morgan
It was a unique time in the market.

01:32:50:02 – 01:33:06:23
Rod
Well, I gotta tell you something. Just as an aside, just for a second, I want you to continue your story, but I just heard about a 700 unit asset in Texas for ten K a door. Oh, yeah. So it’s coming. We’re starting to see it. It’s coming anyway. Please continue. So you you what’s what what asset class were you doing?

01:33:06:23 – 01:33:09:06
Rod
Were you doing multifamily Cleveland or single family? Small.

01:33:09:09 – 01:33:19:04
Morgan
All multifamily. Okay. 2 to 10 unit type deals. Okay. Little deals. Because right at the end of the day, I wanted reps of 10 pound dumbbells. Gotcha. I didn’t want to get that 75.

01:33:19:06 – 01:33:20:28
Rod
Yeah. Gotcha. That’s a great analogy okay.

01:33:21:03 – 01:33:26:07
Morgan
We did 20 of those deals okay. Months was a small fund. We bought them all in cash.

01:33:26:07 – 01:33:27:18
Rod
20 and 18 months.

01:33:27:18 – 01:33:32:10
Morgan
We were aggressively working with wholesalers agents, directors. So I mean we were doing and.

01:33:32:10 – 01:33:33:06
Rod
This was when.

01:33:33:08 – 01:33:42:22
Morgan
This was 2020 until 2022. Wow. We were snapping them up. Okay. And these properties, generally speaking, we put about the same amount into the rehab as we would into the purchase price.

01:33:42:22 – 01:33:44:06
Rod
Yeah yeah yeah yeah.

01:33:44:07 – 01:33:51:27
Morgan
But at the end of the day, we landed on this this cash flow bridge that ultimately allowed me to leave my W-2, and I helped our investors also create a.

01:33:52:04 – 01:33:54:00
Rod
Sure the returns. Yeah.

01:33:54:03 – 01:34:05:07
Morgan
And it showed, though I think ultimately that we could have a big impact on the quality of affordable housing, but also have completely non concessionary returns.

01:34:05:09 – 01:34:19:12
Rod
Yeah. Right. No. And that’s that’s challenging to do I mean affordable housing is is it’s very very difficult. You know you can’t you pretty much can’t do it with, with new build and, and so you were able to do it in Cleveland. Are you still investing in Cleveland.

01:34:19:17 – 01:34:33:29
Morgan
You’re still we’re not buying so much. We’re actually in the process of disposing those assets about five years early. This was a ten year lock up fund. Oh, interesting. Our property values have shot up so much. Yeah, for us, it’s actually worth selling them.

01:34:34:03 – 01:34:38:13
Rod
Okay. So you. So you said tenure. That’s interesting. Most people do five. So you did ten.

01:34:38:16 – 01:34:42:22
Morgan
We called it the perpetual income fund. And you know, at the time that was really critical.

01:34:42:25 – 01:34:49:04
Rod
So did you, just out of curiosity, did you, did you vertically integrated on the management or did you hire third party?

01:34:49:04 – 01:35:06:02
Morgan
It’s a great question. A little bit of a pseudo approach to both. Okay. We have done this now in a few markets where we go in, we’re not satisfied with the quality of management. We work very, very closely to make the management company that we want, but we don’t own it ourselves. We want the locals there and we work with one.

01:35:06:02 – 01:35:12:07
Morgan
So in Cleveland we really brought somebody up help train processes, systems and interesting.

01:35:12:10 – 01:35:33:05
Rod
Interesting, interesting. Yeah. The management companies that managers that size assets are typically very unsophisticated. They you know, very often it’s a broker doing it on the side. And so you basically groom them and and that’s a smart approach. When you had enough infrastructure where it would make sense to do that. And it would make sense to that person to allow you to do that.

01:35:33:07 – 01:35:35:04
Rod
What other markets have you done this in?

01:35:35:06 – 01:35:50:16
Morgan
So we’ve so outside of Cleveland, a focus after this point because we were creating so much cash out of this, out of this, affordable housing approach in buying creatively finance type deals, subject to seller finance, single, family or small.

01:35:50:19 – 01:36:10:07
Rod
That was going to say that’s mostly single family. Yep. Okay. And by the way guys, subject two is where you basically step in and take over someone’s loan, and just start making their payments. Very dangerous actually for both parties. Just FYI, because back in the day, there was a lot of that going on in 2007, 2008.

01:36:10:09 – 01:36:32:06
Rod
And there were people doing that. And then they couldn’t either they couldn’t or they didn’t actually pay the mortgage, and it was called equity skimming. And people went to jail over it. So it’s not something I would recommend candidly. And of course, it’s dangerous to the seller because if the person doesn’t make the payments, then you know, their credit’s destroy, but typically you’re buying them if they’re already distressed, like if they’re in some financial distress.

01:36:32:06 – 01:36:32:15
Rod
Correct.

01:36:32:18 – 01:36:34:19
Morgan
Typically, yeah. We’re helping people out of foreclosure.

01:36:34:25 – 01:36:35:19
Rod
Out of a foreclosure.

01:36:35:19 – 01:36:36:16
Morgan
And we also do things.

01:36:36:20 – 01:36:45:20
Rod
And by the way, I’ve done probably 272 deals. So so this is the pot calling the kettle here. But so you did subject to create a financing in what markets?

01:36:45:23 – 01:36:51:14
Morgan
So that I love this market. Clarksville, Tennessee. Oh, I love Clark’s Raleigh Durham. Charlotte.

01:36:51:15 – 01:36:52:27
Rod
Oh, those are great Texas markets.

01:36:52:27 – 01:37:13:17
Morgan
You know, I really wanted the sun Belt exposure, right. And the way that we really have gone counter trend. We went into Cleveland when everyone was chasing growth in the Sunbelt. We started buying distressed in the Sunbelt when it started being felt right. And so that’s how we also were able to leverage in our situation tax advantage, because you’re you’re in high leverage situations to help offset some of the fund.

01:37:13:17 – 01:37:34:03
Rod
Sure sure sure. Well hallelujah with 100% bonus depreciation coming back. Right. So so I love Clarksville. I’ve an asset in Nashville. I have family in Cookeville. Just like Cookeville. It’s not Cookeville. Cookeville. Cookeville. Yeah, yeah. Hey, I’ve got a I’ve got a I’ve got a hick Tennessee cousin doesn’t even know how to pronounce our last name, but, yeah, we tease each other.

01:37:34:03 – 01:37:48:15
Rod
He’s actually like a brother, but but, Yeah. No. Love that market. And I’ve seen some really decent deals, smaller deals that were out of my investment criteria, but sounds like perfect for what you’re doing in Clarksville. Yeah, yeah. So, so what’s next?

01:37:48:22 – 01:38:10:06
Morgan
So really going through the experiences of the last 4 or 5 years as a GP on these different asset types, we decided we wanted to pursue the larger format, economies of scale, again, affordable housing in the multifamily space. And we sort of rejiggered our approach a little bit to say, you know, minimum 50 units, we’re going to do low minimum.

01:38:10:06 – 01:38:10:18
Rod
Okay.

01:38:10:23 – 01:38:30:27
Morgan
Yeah. Okay. I spent about a year underwriting. I think we looked at a thousand plus deals at no to almost every one of them and eventually found an asset. The most recent acquisition was in Lubbock, Texas. Town, that’s growing north of 1% a year. The assets about a half a mile away from a 45,000 person school.

01:38:31:00 – 01:38:40:05
Morgan
And it is so severely distressed. I mean, we bought it at 68% occupancy. It needed $1 million of rehab. It hadn’t been touched since 1966.

01:38:40:05 – 01:38:42:09
Rod
There’s just a lot on or property, a.

01:38:42:09 – 01:38:44:29
Morgan
Lot of work to be done. And how.

01:38:44:29 – 01:38:45:21
Rod
Many units?

01:38:45:24 – 01:39:03:03
Morgan
86. Okay. I think people didn’t get the story. You know, in these kind of markets where we target, we tend to not, you know, they’re not there are not institutions necessarily competing. They’re not that size. Yeah. And we also tend to be a little more sophisticated than the locals. And so it’s kind of a sweet spot in Cleveland was like that too.

01:39:03:03 – 01:39:03:13
Morgan
For now.

01:39:03:18 – 01:39:26:06
Rod
That’s a very astute, understanding, you know, that that institutional investors are not interested in anything under 100 units and maybe not even that small anymore. But, you know, that that. But but with your experience at this point, you’ve got a level of sophistication, like you said, that’s going to be better than than smaller mom and pop investors.

01:39:26:08 – 01:39:30:28
Rod
Now, so this is something you’ve got going right now, basically this Lubbock.

01:39:30:28 – 01:39:44:07
Morgan
Texas, where this one in January. Okay. Walk in unbelievable basis. Yeah. And immediately we see the cracks of why this has been a challenging year for others to buy also.

01:39:44:07 – 01:40:05:17
Rod
So you’re learning you’re getting some lessons. So, trial by Fire. Yeah. No. And that’s how it works, you know. And but that’s what makes it what doesn’t kill you, you know, makes you stronger. But, I tell you, there there are. I mean, I’ll give you an example of, again, like that 10,000 per door thing that we just heard about.

01:40:05:20 – 01:40:27:03
Rod
We’ve got an asset, in San Antonio, 200 units that we just redid, and it’s gorgeous. And it’s now 95% occupied and beautiful on a lake. And the unit that the building. I’m sorry, the building. The complex next door sold for 40,000,003 years ago or four years, 3 or 4 years ago. And we think we might be able to get it for 24.

01:40:27:05 – 01:40:43:05
Rod
And it’s right next door. Yeah. And I mean, you know, who knows if it’ll happen? The lender’s taken a big haircut. But guys, you heard me say it. And I get hate before it all the time. Yeah. You’ve been screaming saying it’s going to be a crush forever. Well, I think it’s here, I really do. And and I don’t know how you feel.

01:40:43:05 – 01:40:50:16
Rod
If you feel like there’s distress. I mean, I’m seeing tons of distress, a lot of deals being sold for debt, plus fees, and they still don’t pencil. Have you seen those?

01:40:50:17 – 01:40:55:11
Morgan
Yeah. Especially if you’re in touch with the lenders. Right. First name with the brokers getting first access.

01:40:55:15 – 01:41:08:01
Rod
Right. Right. Yeah. Of course. Yeah. And and and you’re seeing you’re seeing a lot of distressed assets. So you know you’ve heard me say it. If there was ever a time to get, get serious about this business, it’s right now because it’s happening.

01:41:08:08 – 01:41:26:07
Morgan
And, and you know, just wanted to elaborate on these distressed assets. Right. They’re not cakewalk either. These are these are these are hard projects that that in some cases require you to be all in. Well, yeah. This Lubbock asset, it was such an interesting one for us because we go in and realize we need to build the management company of our dreams, and it doesn’t exist today.

01:41:26:10 – 01:41:29:21
Rod
Oh no kidding. Even at that size, you couldn’t find this company. Even.

01:41:29:24 – 01:41:48:05
Morgan
Between Odessa and Midland in Amarillo, we said we’re we’re not satisfied with the call. We’re going to come in and rejigger this to what we need. We realize that we have to manage crews of teams from you know, I’m in Southern California. This is a two flight town for me, right. And manage $1 million rehab on scope and within budget.

01:41:48:07 – 01:41:56:10
Morgan
And we get hit in the first couple of weeks. New sheriffs in town occupancy goes from 68 to 50%. I didn’t underwrite.

01:41:56:10 – 01:42:13:11
Rod
That. No. Well, you know, but it it may not have just been the new sheriff in town. You may have gotten bad information on your due diligence when you’re and you looked at it and, you know, you may have been physically occupied at 68, but economically at 50, you know, and by the way, guys, there’s a big difference between physical occupancy and economic occupancy.

01:42:13:11 – 01:42:27:03
Rod
Physical is who’s living their economic who’s who’s actually paying. And, and you know, it’s a common, common, occurrence now, so million dollar rehab. So about what, about 12 grand a unit, basically. That’s not a significant rehab.

01:42:27:04 – 01:42:48:23
Morgan
Not significant. They’re mostly one bedrooms. Okay. The part the part that was interesting about this is I didn’t realize the mindset shift that would have to come with it. Right? I when I walk into the situation, I realize, like, you know, what we have to do here? It took me a little while. It took me a few weeks of really feeling like I almost got my mind caught a little bit in the problems, and not in the solutions of what we needed to do.

01:42:49:00 – 01:42:50:25
Rod
So it was a little overwhelming.

01:42:50:28 – 01:43:02:10
Morgan
My name’s on the loan, right? This is a this is a you know, this is a situation where the long tail could be very, very adverse. And I want to do everything possible to protect the $1.8 million of investor capital that we raised.

01:43:02:13 – 01:43:21:20
Rod
That’s a that’s all 1.8 was that if we got a good deal. Wow. That’s cheap. That’s not that’s a pittance I raised 12, I made 12 million for the 200 million units I was just telling you about. So, so so, some questions, just out of curiosity, what size? So the one bedroom units primarily is that does that serve that demographic?

01:43:21:20 – 01:43:22:21
Morgan
Yes. Okay.

01:43:22:24 – 01:43:24:09
Rod
That’s not a family demographic.

01:43:24:09 – 01:43:27:02
Morgan
That’s a half a mile from a 40. Okay.

01:43:27:09 – 01:43:28:10
Rod
How big are the units?

01:43:28:10 – 01:43:29:15
Morgan
About 500ft².

01:43:29:17 – 01:43:30:20
Rod
Yeah. So those are small.

01:43:30:22 – 01:43:31:09
Morgan
Not doing.

01:43:31:12 – 01:43:48:27
Rod
Okay. I’m going to tell you that my experience with units that small as you get a lot of turnover. But it’s students. So maybe that’s that that’s an offset. That’s an offset there. But yeah I like larger units. And 60s built. So you know, probably don’t have washer dryer hookups.

01:43:49:04 – 01:43:51:24
Morgan
We’re actually building a laundry building in that, in that.

01:43:51:24 – 01:43:56:28
Rod
Gotcha, gotcha. Okay. And are you seeing students or staff or what?

01:43:57:00 – 01:44:04:07
Morgan
Workforce housing. Okay. Work. I think I think what will happen is a student housing developer will buy this. Okay. I think it’s going to be a few years before.

01:44:04:07 – 01:44:24:02
Rod
We see the neighborhood become okay. Okay, okay. So have you heard the expression leveling up? You know, what I’m talking about is when you recognize life is about growth and continuously pushing yourself to higher levels. Now, if you’re ready to level up and push yourself and take action in this incredible multifamily business, you ought yourself to spend a couple of days with me November 1st and second.

01:44:24:06 – 01:44:45:06
Rod
I’ve got a two day online virtual bootcamp that you can attend for the price of a lunch, literally. And I don’t sell anything there. It’s just training about every facet of the multifamily business you’re going to leave knowing how to find deals, how to evaluate those deals, how to raise all the money you need for your deals, how to finance your deals, had a syndicate, joint venture, property manager, you name it, and a lot more.

01:44:45:06 – 01:45:03:07
Rod
And of course, I spend a significant amount of time on your mindset and your psychology. So you actually take action with what you learn. And again, nothing’s being sold there and the price is ridiculous. It’s kind of a no brainer. 18 hours of training with nothing being sold. So text bootcamp to seven, two, three, 4 or 5 right now, or go to Rod’s bootcamp.com again.

01:45:03:07 – 01:45:23:07
Rod
Text bootcamp to 72345. And I’ll see you soon and I promise you’ll be glad you came. Decent area national reach, national tenants around it, things like that. Okay. National super super important. Yeah I mean I if there’s not a Starbucks within a couple of miles, I’m out. You know, I mean I, you know I don’t I, I want to go down to the, I want to go down to the main intersection.

01:45:23:08 – 01:45:32:01
Rod
I don’t want to see Bob’s Burgers and sushi. I want to see, you know, McDonald’s, Burger King, you know, national retailers, Home Depot, Lowe’s, things like that.

01:45:32:01 – 01:45:40:24
Morgan
Yeah. That’s right. So the real reckoning of this for me was, was ultimately facing the, the solutions of how do we solve for this thing. How do we get it to stability.

01:45:40:24 – 01:45:41:24
Rod
So what’d you come up with?

01:45:41:26 – 01:45:51:24
Morgan
Well, there were a few different things, right. Managing that rehab, it just meant we had to be on site. I’ve been in Lubbock every two weeks, and it’s. The sacrifice.

01:45:52:00 – 01:45:56:13
Rod
Sucks. I’ve. It sucks. I’ve done it. I’ve done it, and it’s no fun. But you got to do it.

01:45:56:13 – 01:46:16:17
Morgan
But you got to do it. And that’s how serious we take this. Yeah, the PM company, I mean, we go through the inside out. We’re figuring out AI solutions for lease up. We’re figuring out how to build a best in class tech approach website. And I realize that a lot of the startup experience that I had had actually goes right into, how do we run this business like a startup, this building like a startup.

01:46:16:17 – 01:46:20:22
Rod
So you found an existing management company and you’re helping them improve.

01:46:20:22 – 01:46:27:24
Morgan
I mean, we’ve, we’ve we’ve gone through the whole system and said, you know, this is how we I want to improve all of these. And they’re receptive and they get it.

01:46:27:26 – 01:46:34:00
Rod
What are you doing on the on the lease up process with AI? What, are you using any off the shelf, solutions or.

01:46:34:00 – 01:46:49:15
Morgan
We’re using Lit Hub. That’s, that’s the call hub LED hub. Hub is is doing some, like, virtual showing type stuff. We do a lot of VA type work. We’re crawling marketplace with Vas and we’re constantly reaching out. We have them funneling in.

01:46:49:18 – 01:46:53:04
Rod
And so so you’ve got Vas taking calls or what do you have you.

01:46:53:08 – 01:47:15:20
Morgan
Got Vas prospecting. Okay. And then ultimately we get to the sort of capture funnel area right where we divide. We’ve actually divided and conquered between the property management company and people within Ocean Ridge. There’s a one of my partners, we found that his his gift in this in this process has been calling and closing leads.

01:47:15:21 – 01:47:18:16
Rod
No kidding. So he’s actually he’s actually pounding the phones with tenants.

01:47:18:16 – 01:47:19:17
Morgan
Wow. We’ve gone from.

01:47:19:20 – 01:47:21:02
Rod
That’s rolling up your freaking sleeves.

01:47:21:02 – 01:47:25:02
Morgan
In one month, we’ve gone from 60% to 90% expected in this asset.

01:47:25:02 – 01:47:25:16
Rod
No kidding.

01:47:25:16 – 01:47:26:26
Morgan
And we’re about to start to refinance.

01:47:26:26 – 01:47:46:05
Rod
Oh, good for you, good for you, good for you. So you’ve turned it around. Good for you. Yeah. Yeah. That’s that’s that’s, that’s an education with something like that and. Yeah. Trial by fire. I had an asset in Shreveport. I literally had to live there for for months, and I could. I won’t bore you with. Oh, my God, the shit I had to deal with there.

01:47:46:07 – 01:47:49:16
Rod
So, you know, What? So what’s next?

01:47:49:18 – 01:47:50:11
Morgan
So another one.

01:47:50:11 – 01:47:51:09
Rod
Like that or what?

01:47:51:15 – 01:48:02:11
Morgan
We’re looking in a couple other national markets that are. I got a free institution. I like Oklahoma City a lot, really. I like, but I also have a factor of lifestyle that goes over the.

01:48:02:14 – 01:48:04:05
Rod
Oh because it’s closer. Yeah, yeah, yeah.

01:48:04:06 – 01:48:05:23
Morgan
Let’s cut that Mississippi one.

01:48:05:23 – 01:48:07:05
Rod
Flight instead of two. Got it.

01:48:07:06 – 01:48:18:22
Morgan
Yeah. And frankly you know there are great. You know east of the Mississippi. Yeah. Some markets Columbus Greenville you know lots of Florida. Right. But I prefer to be a little closer to home. And I can manage it more, more professionally by being there.

01:48:18:23 – 01:48:34:20
Rod
Guys, I got to tell you, it’s critical that you look at this through a lifestyle filter. You know, I tell my students in my boot camps, if you live in LA, you’re not investing in frickin Boston. There’s plenty of low hanging fruit closer to you. That’s right. And vice versa. So that’s super important.

01:48:34:22 – 01:48:41:25
Morgan
And I heard it phrased once. Even ride that. Like, if you feel a hesitation to get on a flight, right? That’s just.

01:48:41:28 – 01:48:42:25
Rod
That’s what we call a clue.

01:48:42:25 – 01:48:43:09
Morgan
That’s a clue?

01:48:43:10 – 01:49:05:13
Rod
Yeah. So, you know, so, you know, I have a lot of listeners that want to be where you’re at. They want to be an operator, you know, and, and, certainly, guys, if you have the ability to invest passively, that that’s a great place to start. And, and you could check out, Morgan’s company, Ocean Ridge. Capcom is his is his website.

01:49:05:15 – 01:49:15:29
Rod
Sounds like he’s doing some great things and you can start as an LP, but I’ve got a lot of listeners that also want to do this actively. Yeah, speak to them. What advice would you give them?

01:49:16:02 – 01:49:34:18
Morgan
Look, there are lots of different ways to get involved, but you don’t have to take the whole thing on it once, right? Right. Taking a piece of the pie is critical. And there are so many great people in the real estate space that can lean into your personal gifts of what you can do best. Now, I remember when I was in your shoes.

01:49:34:26 – 01:49:59:05
Morgan
I’m trying to find my way to. I want to be an operator, a copper razor. Right. What what was really relevant for me was understanding my personal energetic lens. For instance, I in my cliftonstrengths test am a learner. I’m an individual user, which means I like to build people up. I’m a maximizer, which means I like to take the pieces of the puzzle and fitting together most effectively.

01:49:59:07 – 01:50:27:14
Morgan
And I’m very achievement oriented and I’m very responsive. That leans really well into overseeing a CapEx project that leans really well into overseeing a PNL, or figuring out how to basically make something fit together in the most efficient puzzle possible. I have partners on my team. When I am hiring or aligning with partners, I’ll ask them to do their Cliftonstrengths test, and I’ll look for weaknesses and deficiencies or just areas where I’m not strong.

01:50:27:21 – 01:50:35:00
Morgan
One of my partners is he has a focus on significance. He wants to be somebody that is in that can.

01:50:35:00 – 01:50:36:00
Rod
Be that can be a negative.

01:50:36:02 – 01:50:53:29
Morgan
It can be a negative if not harness the right way. But it can also be a positive. If you align the mission of elevating the standard of affordable housing, of bringing 10,000 new housing units online, in the affordable housing space in the next five years, as our company goal, and saying you’re going to be the bulldog that brings that together.

01:50:53:29 – 01:51:25:11
Rod
So. So you leaned on his his need for significance. Yeah, I you know, I spent 20 years with Tony Robinson and, he talks about six human needs. And one of them is significance, but that’s the that’s the one you want to try to pull away from as much as you can. And the other one is certainty, the two that are in the negative sphere, where, you know, everything has to be just exactly certain, but, so, so, I love what you what you said that where you, you focus on your strengths and but you talked about this cliftonstrengths, thing.

01:51:25:11 – 01:51:43:16
Rod
Of course there’s Myers-Briggs. There’s Tony Robbins has what’s called a disc profile disc, which is very powerful, but it’s really a good idea for you to have your team members do it and see how well you align, and make sure there’s not two balls in the China closet as well, right? That’s right. So talk about your team for a minute.

01:51:43:16 – 01:51:47:29
Rod
I meant to ask you about that. So do you have different teams for different assets or do you have one core team?

01:51:48:05 – 01:51:50:10
Morgan
No. So I have different teams for different assets okay.

01:51:50:10 – 01:51:51:19
Rod
So you coach ggplot.

01:51:51:19 – 01:51:53:21
Morgan
Then I could go in equity.

01:51:53:21 – 01:51:54:24
Rod
Is that your biggest.

01:51:54:26 – 01:52:16:27
Morgan
We raise equity. Yep. And so there are two parts to our model okay. For the assets that we manage I work with operating partners within the Ocean Ridge Group. I work with an underwriter within the Ocean Ridge Group. I have somebody else who sort of keeps all the pieces together. But we also do invest in others deals that are in either markets where we don’t think we’re competitive.

01:52:17:00 – 01:52:21:20
Morgan
There’s going to be on this side of the Mississippi, right, or an asset classes where we’re not necessarily competitive.

01:52:21:20 – 01:52:22:13
Rod
So you’re another asset.

01:52:22:13 – 01:52:24:09
Morgan
Classes like mobile home parks.

01:52:24:16 – 01:52:25:29
Rod
You’re in you’re in mobile home parks.

01:52:25:29 – 01:52:31:09
Morgan
Yeah. We actually just did 149 pad three park deal in Clarksville.

01:52:31:15 – 01:52:50:10
Rod
No kidding. With another part of Great Market. Oh. That’s fantastic. Yeah. I just had, Frank Roth here. Yeah, you know that? Yes. I’m sure if you’re in mobile parks. Literally. You sat there last week. Yeah. Isn’t that crazy? That is amazing. Yeah, I actually I actually went to his mobile home park, training course two years in a row because I was going to do mobile home parks.

01:52:50:10 – 01:53:00:11
Rod
I didn’t pull the trigger on it, but, but, yeah, it’s a real treat to have him here, but and of course, do you know Kevin Bopp who’s in that space? Yeah. Kevin is very, very good friend. Yeah. Very good friend.

01:53:00:17 – 01:53:01:10
Morgan
Fantastic.

01:53:01:11 – 01:53:09:28
Rod
Yeah. He’s raised hundreds of thousands of dollars for my charity. So, so, so you’re doing mobile home parks. Good for you. Love that asset class. Any other asset classes or.

01:53:10:00 – 01:53:16:05
Morgan
You know, on the ocean Ridge front, which is how we serve investors, we focus on affordable housing. Now, I’ve done some things. Well, that’s.

01:53:16:05 – 01:53:17:08
Rod
Mobile home parks, right?

01:53:17:08 – 01:53:44:00
Morgan
Yep. Right. Mobile home and multifamily. All right. That’s our core area. I’ll do on occasion some one off things that are, that are very unique. First I was mentioning to, to offset, we actually have, I have a personal LP investment down south here in, Naples, Isle of Capri for a hurricane proof dry storage Marina that uses automated manufacturing technology to get the boats and then put them.

01:53:44:00 – 01:53:45:06
Rod
In a very cool.

01:53:45:06 – 01:53:49:02
Morgan
And there are all these kind of unique plays. So I again cut into the barbell.

01:53:49:02 – 01:53:53:03
Rod
And hurricane proof automated. So that’s a robot pulls the boat.

01:53:53:03 – 01:53:58:25
Morgan
Is an app. Oh you’re driving down from Fort Myers or whatever. I’m going to get the boat 45 minutes. It’s sitting in the water waiting for.

01:53:58:25 – 01:54:03:15
Rod
You and it’s done. The app tell someone to do it or the app. It’s actually.

01:54:03:16 – 01:54:08:10
Morgan
A mechanical. It’s mechanical. And they’re starting to do this all over the state of that’s cool.

01:54:08:13 – 01:54:36:09
Rod
And it’s Naples. It is Naples because, you know, because old people live here in Sarasota and their parents live in Naples, right. But but Naples is beautiful. They got to figure out this old. Actually, actually, the joke is really more for Sarasota, which is why I got a place in Miami is sold here. But so. So, And, guys, I really love what Morgan said about, you know, determining what your strengths are through a personality profile test of some sort like this Clifton strike.

01:54:36:09 – 01:54:41:01
Rod
I’ve never even heard of Clifton strength. Is that, like a big thing in the West Coast? With the with the IT people?

01:54:41:02 – 01:54:43:02
Morgan
You know, I learned about it from Vina Jetty.

01:54:43:03 – 01:54:43:28
Rod
Vina. Oh, Vina.

01:54:43:28 – 01:54:45:28
Morgan
I love him and his mentor to me. And oh, I.

01:54:45:28 – 01:54:46:15
Rod
Love you know.

01:54:46:15 – 01:55:03:21
Morgan
I was it was funny. I was a little resistant. I’m like, I’ve done Myers-Briggs. I don’t know, like how this is it is so actionable. And the moment when I saw my number one is learner and I realize, why doesn’t everyone try to learn everything about what they’re doing before they start? It was like such an Like a basic moment.

01:55:03:21 – 01:55:04:22
Morgan
But I’ll never forget.

01:55:04:23 – 01:55:19:03
Rod
That’s not the case. It’s, you know, it. Oh no, that’s funny. You know, it’s funny. I saw Vina, because I was being interviewed on a show in Miami, and she was being interviewed right before I was. And, Yeah. And, you know, I just saw her name because she’s going to be at Brad’s event that’s coming up in August.

01:55:19:03 – 01:55:39:28
Rod
But, please, if you talk to her until I give her my regards, I. Well, I really like her a lot. I will, so. Okay, so, you’re you’re you’re in some unique assets as well. If you see opportunity, jump on it. Okay. And so you’re going to you’re you said your company goal is what you say 10,000.

01:55:40:01 – 01:55:42:01
Morgan
We want we want to bring 10,000.

01:55:42:01 – 01:55:42:29
Rod
10,000 affordable.

01:55:42:29 – 01:55:49:19
Morgan
Units. And and I honestly think it’s a cultural failure that there are properties with boards up in Miami started.

01:55:49:22 – 01:55:51:03
Rod
Yeah. It’s crazy, it’s crazy.

01:55:51:06 – 01:55:51:10
Morgan
Yeah.

01:55:51:10 – 01:56:10:15
Rod
It is crazy. You know, that’s the that’s the kind of stuff that those governmental agencies should be working on. Yeah. To because they’re such a frickin need, you know? Now, I’m also getting into senior housing. I don’t if that interests you at all. But that’s something I’m very interested in. We’ve got we’ve got an asset that we’re closing on in two weeks in Pittsburgh of all places.

01:56:10:17 – 01:56:36:08
Rod
Not not a market I would have initially picked, but, Hey, it’s it’s, we’ve got an operator that that, is just, rock star operator. And it’s all about the operator with that, and, and they, they said it’s a fantastic market. They did their demographic search, but but, so are you, as part of these 10,000 units, are you doing a mobile home park push as well, or is it just going to be?

01:56:36:08 – 01:56:36:20
Rod
You are.

01:56:36:24 – 01:56:47:14
Morgan
I think I think mobile home parks are some of the biggest hidden. Maybe they’re not even hidden gems at this point, but I agree that you have this unfortunate kind of NIMBYism effect, right? I don’t.

01:56:47:14 – 01:56:47:22
Rod
Know that.

01:56:47:22 – 01:56:49:18
Morgan
Word. Not in my backyard.

01:56:49:18 – 01:56:56:22
Rod
Oh, got my backyard. Oh, yeah. Yeah, that’s that’s a you can’t you can’t build a mobile home park right now. Try to build one. Just see what see what happens.

01:56:56:24 – 01:57:12:15
Morgan
But you have them grandfathered in. Right. And the mobile home parks coming new off the, you know off the lot 6080 grand maybe that you can finance to tenants. And it’s just I think the most attainable form of affordable housing no question.

01:57:12:15 – 01:57:29:06
Rod
It’s well it’s it’s the it’s the bottom. It’s the bottom layer in affordable housing. I mean it doesn’t go much lower than that. I mean, I don’t mean that in a negative way, but certainly in an economic way. It’s the it’s probably the lowest barrier. But no, I, I, you know, I, I don’t know if you knew that what?

01:57:29:06 – 01:57:52:14
Rod
You probably didn’t know this, but, you know, I was going to get into an in a big way. And I had six virtual assistants geocoding every area in the country. Because a lot of mobile home parks are misclassified, you can’t find them in the county records. So they would they would find a mobile home park in the county record, and then they would fly around on Google Earth, around it and look for other ones, geocode them, see who owns them.

01:57:52:16 – 01:58:02:15
Rod
We would, break down the entities that own them, found out where they live personally, and created a mailing list that way. And I never did anything with it. But, I mean, I literally mapped a lot of the country that way.

01:58:02:20 – 01:58:04:16
Morgan
Rod, why didn’t you pursue that further?

01:58:04:18 – 01:58:21:14
Rod
Because I decided I wanted to get into multifamily. Yeah, I want to get into apartments, and, and I mean really double down on apartments. I was already in them, but I wanted to double down. You know what I discovered when I lost everything in 2008 was it was the houses that pulled me down eight, 800 houses.

01:58:21:14 – 01:58:46:02
Rod
And I had several apartment complexes. My apartment complexes would have done just fine if I’d cross collateralized them with packages. A house they pulled back about 11%. And so I was just going on based on my own back, my own history. And, you know, I started the podcast, and was talking mostly multifamily. And when it really took off, you know, I hit a million downloads and I was number one in education, real estate, entrepreneurship on iTunes.

01:58:46:02 – 01:58:53:17
Rod
I was in number one. And all those categories. It’s like, man, maybe I better do something with this. And so I wrote the book and yeah, the rest is history.

01:58:53:17 – 01:59:00:11
Morgan
So do you feel like for you is about having your first principles and saying like, this is like my foundation, this is what I know we’re going to do.

01:59:00:11 – 01:59:18:11
Rod
Well, I knew it. Yeah, I didn’t know mobile home parks, although I went to Frank’s event two to 2 to 2 times. I went there with Kevin once actually, before he got rolling. Yeah. And my brother and, you know, Kevin now has, I don’t know, thousands and thousands of pads. My brother owns several, mobile home parks with it.

01:59:18:18 – 01:59:38:22
Rod
And listen, I love the asset class. I would absolutely be interested if someone asked me to co-invest in one, because I love the asset class and believe in it. But, but I’m also really hard on senior housing right now. There’s 10,000 people a day turning 65 in this country, me being one of them in January. And and they’re, you know, in ten years, they’ll be 75.

01:59:38:22 – 01:59:59:06
Rod
And there’s such a shortage of beds, it’s insane. Yeah. So, you know, that’s like a tidal wave, you know, that I want to surf instead of getting crushed. But. Yeah, but, but, yeah, there’s so much opportunity in our in our world, you know, I mean, the multifamily is getting killed right now. There’s so many operators that they got adjustable rate debt that are in trouble.

01:59:59:08 – 02:00:21:29
Rod
You know, there’s a debt wall, these these these operators that have debt that’s come do you know with a balloon payment. And you know, they either have to refinance or sell and sales are down 90%. I don’t know about you, but my inbox is is I mean, the last couple of years has exploded with deals from brokers and then refinancing damn near impossible because they don’t meet the debt service coverage requirements.

02:00:21:29 – 02:00:40:11
Rod
So, you know, the, the, the catch phrase is extend and pretend with these lenders. And, you know, if the rates come down, it may ease up. But but the reality of it is I don’t see big rate reductions. They do a quarter point half a percent, a quarter percent drop. Is it really going to impact anything. Yeah I don’t know.

02:00:40:11 – 02:00:41:06
Morgan
Yeah, yeah.

02:00:41:12 – 02:00:42:24
Rod
Do you think it will I don’t know.

02:00:42:29 – 02:01:01:25
Morgan
I don’t I mean we saw it back in December with a and minimally impacted price. I was actually listening to an economist from crest last week talking about they thought a temporary drop followed by an increase in inflation and rates going up next year due to labor shortages. So at this point, my crystal ball is.

02:01:01:28 – 02:01:19:07
Rod
Yeah. No, it’s, it’s it’s a it’s a mess. And you know and you know Powell and Trump are at each other’s throats and so who knows. But what’s he got. How many months since he got left I mean I think Trump’s going to put somebody in there that’s going to do something. But yeah. No. But you know, I, I love to give people contrast.

02:01:19:07 – 02:01:38:01
Rod
You know what I got in the business, the rates were 18%. Yeah. This is 1978. They’re 18%. And I remember just being freaked out and super excited when they hit seven, you know? So, yeah, you know, there’s some contrast, but, you know, prices have to adjust to the rates. They, they they’ve been slow to do that.

02:01:38:01 – 02:01:50:04
Rod
But like literally just this last week I found out about those 10,000 a door deal and the and the one next door for 24 million. So, things seem to the logjam seems to be breaking because you couldn’t even find deals this last year, right?

02:01:50:04 – 02:02:08:09
Morgan
Absolutely. And I mean, what’s interesting too is you can overlay then sort of fundamental economics on it, right? Regardless of what’s happening in the interest rate environment. Right. You have the, you know, the supply wave and I know multifamily. So that’s what I can speak to. But you have the supply wave of stuff that was started in 2021 2022.

02:02:08:12 – 02:02:23:07
Morgan
That’s all kind of coming to a point where we’re starting to go off a cliff, right. And we’ve seen the demand of tenants largely keep up, maybe got outpaced a little bit. But in the next couple of years you just don’t have the supply.

02:02:23:14 – 02:02:24:24
Rod
There’s going to be a shortage of unit.

02:02:24:24 – 02:02:37:21
Morgan
It’s going to be a shortage. And especially on the affordable side. Right, right. I mean, even now you see the headlines 500,000 more sellers and buyers. But that’s kind of median. Yeah. Right. You go to the affordable housing side. It’s 4 or 5 million short right.

02:02:37:23 – 02:02:38:12
Rod
Oh it’s crazy.

02:02:38:12 – 02:02:39:29
Morgan
It’s crazy. And it’ll never keep up.

02:02:40:00 – 02:02:58:12
Rod
You just and you know this why people are home sharing. They’re they’re you know they’ve been doing it in New York forever. But, you know, we’re, I, you know, looked into that business back in 2007. And, you know, it didn’t take off then. I didn’t really push it hard, but but I think it’s become a it’s going to become a thing.

02:02:58:12 – 02:03:04:11
Rod
And so so you mentioned before we started recording that you suffered a little bit of my podcast in the past.

02:03:04:13 – 02:03:06:21
Morgan
Not suffering. I ended up.

02:03:06:23 – 02:03:21:26
Rod
Yeah. Well thank you, thank you. So, you know, you know how you you know how I, I’m big on mindset and psychology and fear and limiting beliefs and so on and so forth. So, you know, talk about any experience that you’ve had in the in, in that environment. You know.

02:03:21:28 – 02:03:53:25
Morgan
Now, I mean, the reality is I think mindset is everything, right? Right. I mean, you could be the most capable person of a terrible mindset. And, you know, it’s not going to work out. So I spent a lot of time investing in reading, trying to level up, you know, a lot of the tactics that have worked for me, you know, things like fear setting, let me feel the pain of something at volume ten and really feel it, I mean, really let that thing go, because at the end of the day, it’s probably never going to feel as hardcore as what you just kind of manufactured.

02:03:54:02 – 02:04:17:26
Morgan
It releases some of the power and we get obsessed as a culture with this grow, expand, grow, expand. But we never face the contraction. We very rarely say, let me actually feel what, what, what may be holding me back, what may be this limiting belief, and let it kind of run its course. So I do a lot of, focused on just letting that stuff out for me to then make the space to grow.

02:04:17:26 – 02:04:20:10
Morgan
And it’s I think it’s honestly like my secret weapon.

02:04:20:17 – 02:04:30:07
Rod
So you’ll sit there and you’ll think about a worst case scenario, and you’ll magnify that fear and you’ll sit and suffer in it for a while and just kind of feel it.

02:04:30:10 – 02:04:33:25
Morgan
I will feel it at the highest volume I can, you know?

02:04:33:25 – 02:04:36:22
Rod
That’s fascinating. Did you ever go to a Tony Robbins event?

02:04:36:24 – 02:04:38:08
Morgan
You know, I’ve, I’ve read his books.

02:04:38:08 – 02:04:58:16
Rod
Okay, okay. Because he at his Unleash the Power event, unleash the power event. You know, he walk on fire the first night, but he does something he calls the Dickens process, where he has you think about something that you should have done or should be doing, and. And he has. You feel the pain because you didn’t do it.

02:04:58:19 – 02:05:17:03
Rod
And then he has you magnify that pain and he turns the lights off. And there are people cry and scream. And it’s a really powerful exercise. And, and, and, and and he takes you out the other side. You got to trust that he’s magnificent at it. But but he has you magnified like what happens in five years, who’s no longer in your life, what’s not going on.

02:05:17:05 – 02:05:32:21
Rod
And and I remember at this I’ll, I’ll be vulnerable for a minute. I, you know, I wasn’t happy with my relationship with my kids. I felt like I was too focused on success and I wasn’t as present as I wanted to be. It’s my biggest regret in life. They. They’ll tell you I was a great dad, but I didn’t live up to my own expectations.

02:05:32:24 – 02:05:52:08
Rod
And I when I was magnifying the pain I was, I visualized standing at the grave of my son because he killed himself. I mean, I, I mean, I really twisted the frickin knife and and, and it’s an and and then he takes you out the other side is is who you are. No. And he and it’s I mean, it’s fantastic, but that’s kind of what you’re doing with the fear.

02:05:52:11 – 02:05:53:11
Rod
I love it, and I do.

02:05:53:11 – 02:05:56:24
Morgan
It with my kids, too. I think, you know, maybe not as morbid, but. Yeah.

02:05:56:24 – 02:05:59:06
Rod
Yeah. Sorry, sorry. Yeah, yeah, that that’s more of that.

02:05:59:09 – 02:06:05:12
Morgan
But that’s real. That’s honest. That’s. And if that’s what you need to do, that’s what you need to do for me, I’ll think about I’ve got to get leverage.

02:06:05:12 – 02:06:19:29
Rod
Yeah. You got to get that freaking leverage to actually change your. You mean and you know, that disgust and contempt and and disgust is a really powerful one. And fear, like you said, is very powerful and like that, that effectuating change. That’s the reason he does it.

02:06:20:04 – 02:06:36:26
Morgan
So many adults evolve through trauma, right? It’s like, not until you have a traumatic event, right? This in a way, it’s kind of a micro trauma event, right? Are you let yourself go through and you actually can make the change before the real thing does happen. Right? And you can focus on the solution, not the problem, not the pain or the subconscious programing of that pain.

02:06:36:26 – 02:06:54:00
Rod
Well, it forces you to take action. It forces you to get off your ass and and and, and and make some change. And, and sitting here talking about it, I’m realizing I need to go to another event. You know, I went to his events for 11 years, and finally his head of security was like, dude, why don’t you just join the security team and you can you have to pay to come.

02:06:54:00 – 02:07:01:12
Rod
And so I did that for eight years, but, yeah. Yeah. Wow. That’s that’s awesome that you that you do that, you know.

02:07:01:12 – 02:07:21:18
Morgan
And another nice one. I have this Fridays at 9:00 in the morning. I have a scheduled once a week fierce setting where I literally just go through a whole bunch of recurring things that I face mentally and right. If this goes wrong, this is what could happen. And it’s this weird thing where I categorize these fears that are in my head, put them on paper and just leave them there and I.

02:07:21:21 – 02:07:21:28
Morgan
And that.

02:07:21:28 – 02:07:22:28
Rod
Minimizes them, doesn’t.

02:07:22:28 – 02:07:29:25
Morgan
Minimize them, and they don’t come back up. And there are things that could be super, super scary. It has like a 50% reduction in the feeling if.

02:07:29:25 – 02:07:31:26
Rod
You just writing them down minimizes it out.

02:07:31:26 – 02:07:32:10
Morgan
Of your mind.

02:07:32:10 – 02:07:58:27
Rod
Love it. Yeah, I will tell you. You know, I have I take people through a, work weekly planning process. And one of the pieces that planning process is to write out every piece of your life that matters, the people that matter, the core pieces of your core work that matter like 8 or 9 things, and then things that you want to do, you know, 8 or 9 things, and you basically have put your whole life on one piece of paper and it minimizes or even eliminates overwhelm.

02:07:58:27 – 02:08:19:10
Rod
And it’s the same thing, you know, by by writing it down, it, it, it, it gives you clarity and, and it makes it less onerous. Fascinating. Yeah. So you mentioned a book before we started recording and so I’d like to ask you the question, is there a book that you gift or recommend more often than another.

02:08:19:10 – 02:08:20:12
Rod
Because I’d like you to repeat it.

02:08:20:19 – 02:08:22:23
Morgan
Yeah. No. Look, I’m a pretty avid reader, right.

02:08:22:27 – 02:08:24:22
Rod
From you saw my library. Now I saw.

02:08:24:22 – 02:08:42:27
Morgan
Yours. I was admiring, and I saw many of the same thing. I, you know, love, like, never split the difference, right? Switch how to change things when change is hard. But the one that I read gift I find it’s like in the Christmas stocking every year for different friends. It’s called the Almanac of Naval rather than now. Naval is the co-founder of Angel list or founder of Angel list.

02:08:42:27 – 02:08:53:08
Morgan
He’s done a bunch of things in the venture capital world, but he basically has this guy who compiles his tweets and puts it into a couple chapters around.

02:08:53:09 – 02:08:56:07
Rod
He’s like, Trump, I know. Sorry, sorry, sorry, sorry.

02:08:56:07 – 02:09:16:00
Morgan
Please continue. But it’s it’s health. It’s wealth and it’s happiness. And I have read this book cover to cover. I can’t even tell you how many times to rewire how my brain thinks. Wow. And back when I was grinding in the startup world, goal posts so far out of, you know, making good income but still trying to build, you know, durable and quiet wealth.

02:09:16:03 – 02:09:31:13
Morgan
Nouvel taught me the three forms of leverage. And I always thought, you know, you just work your job, you know, try to do your best. Me make them make some investments. But he taught me about how do you stack leverage, which is nothing more than compound judgment to your advantage.

02:09:31:20 – 02:09:32:20
Rod
Okay. Please elaborate.

02:09:32:25 – 02:09:46:02
Morgan
So the three forms would be labor. You have people working for you. This is your dad’s company, right? For 200 employees. He’s talking to everybody at the cocktail party. Right. But it’s actually kind of the weakest form of the three, because people can walk off the job. Lot of specific knowledge.

02:09:46:02 – 02:09:47:25
Rod
To leverage labor. What’s the next one?

02:09:47:28 – 02:10:02:24
Morgan
Capital is like a lot of what we do in real estate, right? We know the merits of that. We know the drawbacks of that, right in the market cycles. Right. But that’s a lot of what we focus on. And then last is what we’re doing here today. Permissionless leverage digital code base I it doesn’t quit on you. It doesn’t sleep.

02:10:02:24 – 02:10:22:15
Morgan
It magnifies infinitely on your behalf. And if you can take a stack of all of those things and propel it towards solving a problem that you want to solve for, the problem I want to solve for is elevating affordable housing, bringing more units online, helping investors tap into the potential get out of the stock market out of risky stuff.

02:10:22:18 – 02:10:37:20
Morgan
Then I want as much leverage as possible to shout that from the rooftops and to actually take massive action towards it, right? So it’s like, what can you do? You know, listening to this, that’s going to be your own form of leverage that allows you to accomplish your wildest dreams.

02:10:37:20 – 02:11:01:04
Rod
Love it, love it brother. Well, that’s a that’s a wrap. That was really good. Great. Great place. A great place to put a pin in this. So. Well, listen, I am very honored and humbled that you came all this way just to be on my meager little show here. But, but thank you. You’ve added tremendous value. And, let’s let’s circle back in a year or two and see where you’re at, because I’m sure it’ll be a whole different story, and I’d love to see it.

02:11:01:05 – 02:11:05:09
Rod
I’d love to have you back and see see what you’ve accomplished. And I’m sure it’ll be magnificent.

02:11:05:12 – 02:11:06:22
Morgan
Absolutely. Thank you.

02:11:06:24 – 02:11:07:15
Rod
Absolutely.

02:11:07:15 – 02:11:08:03
Morgan
Thank you for.

02:11:08:03 – 02:11:14:10
Speaker 3
Listening to the Lifetime Cash Flow Through Real Estate Investing podcast. If you’ve enjoyed the show.

02:11:14:14 – 02:11:15:22
Rod
Please take a minute to visit.