Titans of Multifamily Real Estate

Ep #500 – Titans of Multifamily Real Estate – Agarwal, Berriz, Klotz, Wasserman

Special 500th Episode with Albert Berriz, Keith Wasserman, Jeff Klotz, and Swapnil Agarwal. An amazing discussion with some brilliant individuals. Here’s some of what we covered:

What it takes to be successful
Most courageous acts
The mentors you have had
Superpowers
Goal setting
Covid outlook
Management challenges
The motivation to succeed

Book recommendations:

Psychology of Money by Morgan Housel

It Worked for Me & My American Journey by Colin Powell

The Alchemist by Paulo Coelho

To find out more about our guests:

Swapnil Agarwal – http://www.nityacapital.com/

Albert Berriz – https://www.mckinley.com/
Jeff Klotz – http://theklotzcompanies.com/

Keith Wasserman – https://www.geltinc.com/

Full Transcript Below:

Rod: Welcome to another edition of “How to Build Lifetime Cashflow through Real Estate Investing”. I’m Rod Khleif and I am absolutely thrilled that you’re here and I don’t think I’ve ever been more excited about a podcast episode in my life. Okay? Now, this happens to be my 500th podcast episode. Wow! And we’re about to hit 10 million downloads which just blows my mind. But, the guys I’ve gotten on the show today, guys. Okay? Well, to say they’re incredibly successful would be the understatement of the year. Now, I’ve been blessed to have interviewed each one of these fine gentlemen on my show previously. So, I encourage you to go find those episodes to learn more about each one of them personally. If you haven’t already watched them or listen to them. Now, Albert Berriz was actually the first person I ever interviewed on my show, which is, I was just telling the guys before we start recording, which is a real funny story. It wasn’t at the time, but I forgot to hit the record button and then after an hour, I was absolutely mortified. But he’s just a beautiful gracious human being and he’s been on the show twice since then, but I digress. But anyway, so, this episode is titled the “Titans of Multifamily”, and that’s for a reason, guys. Okay? I’m not sure that a group of this caliber actually has ever been assembled before. I don’t think so, and this is really gonna be something today. So, let me introduce you to these amazing gentlemen who are on the call with us, and then we’ll get into it. So, the first one is Jeff Klotz. Now, Jeff is the CEO of the Klotz Group of Companies. He’s been involved in about 125, 000 units. He’s done 42 developments back then. Last few years, they sold about 40, 000 units. I think he’s currently with 10, 000 doors in inventory and 5, 000 under development. So, welcome, Jeff.

Jeff: Appreciate that, Rod. Thanks for having me.

Rod: Absolutely! Next is Swapnil Agarwal, and Swapnil is the CEO of Nitya Capital and they’re currently over 12, 000 units, about a billion dollars worth of assets. Welcome back, Swapnil.

Swapnil: Yeah. Thank you, I appreciate being here and it’s 20, 000 units now.

Rod: Oh, it’s 20, 000. Okay. Thank you. Awesome. Congratulations, that’s awesome! So, next is Keith Wasserman, and Keith is a partner with Gelt and they’re in, I think around 15,000 units. About $2 billion worth on that portfolio. Good to see you again, Keith.

Keith: Yeah. Thanks for having me, Rod.

Rod: Absolutely! And last and certainly not least, my friend, Albert Berriz, CEO of the McKinley Corporation. Albert, how many units have you been in over your lifetime? I know you’re in about 20, 000 now. How many have you been involved with as an owner partner?

Albert: 40, 000.

Rod: 40, 000. There you go. Wonderful to see you, my friend. Wow! Guys, this is an honor and I am absolutely humbled. And, you know, as you know, I’m blessed to host the largest multifamily, really, commercial multifamily podcast in the world but also the largest multifamily facebook group with 36, 000 members. And I did a post yesterday and I asked them, what questions they’d like me to ask you, guys. And we’re definitely gonna get into some of those. But before we get started, I just want to say this. We certainly can and will talk about some specific nuances of multifamily investing but I also really think my listeners would love to hear how you guys, you know, how guys like you think, because you think differently than other people. And then, really maybe what drives each of your incredibles, what you feel drives each of your incredible success. And then, for me personally, I’d love to ask you some questions around how you manage and run, what each of you have very large organizations. So, let’s have some fun and get into it with no rhyme or reason to, you know, the sequence of these questions. But, I’ve got a list of them here. And the first question is kind of a big global one, and Albert, I want to start with you. What do you think is the most important trait? Because, let me backup for a second. So, my listeners are aspiring and all the way up to extremely successful multifamily operators. And, you know, for the most part, the larger operators syndicate and joint venture and do things like that. And then, there’s the people that have a few duplexes. What do you think is the most important trait a person needs for success, Albert?

Albert: I would say, “Persistence”.

Rod: Yeah, yeah. Love it. Love it. Who’s got a different answer?

Swapnil: Yeah. I would say, Rod, for me personally, I think it’s the “risk-taking ability”, because I think all of us, every human being we know wants to be successful. But, what are they willing to bet? How hard are they willing to work hard to achieve that success? And I think in that, the most important ability or skill is, “How much risk are you willing to take?” Right? Because as humans, we’re always looking at the downside or the worst case scenario. But if somebody, anybody, a successful entrepreneur can put that aside and focus on the positives and believe in the passion that that person has, I think that’s the most important ability for me.

Rod: Great answer. Jeff, anything to add?

Jeff: Well, I definitely would agree with Albert. I mean, I think that “persistence” is certainly a requirement. Maybe, I might even add the word “relentless” in front of it, you know. A relentless pursuit of persistency, and intensity, and obsession. I mean, I think you’ve got to be a little bit crazy. I guess you could say, you’ve got to be a little bit odd, unusual to do what we’ve all done and to really jump into this business and try to accomplish what almost everyone’s goal is. And I think that a normal approach just isn’t gonna work. You’ve got to be that much more intense, that much more driven, that much more hungry. And then, I’d also go with what Swapnil said. I mean, I think that the ability to take a risk, you know, everything you do in life’s a risk, but the ability to assess those risks and make, you know, risk-adjusted decisions, I think is critical, right? The right, because you know, if you take too much risk, it could be your downfall. If you don’t take enough, you might not have growth. So, I think that, you know, it’s a combination of all the above.

Rod: Great balance between the two. Great answer, buddy. Keith, anything to add?

Keith: Well, it sounds like you guys are all describing me with these comments, relentless.

Rod: Stop it.

Keith: I mean, you could ask my wife. I chased her for nine months before I got a date even out of her. But I’d say, all the above are important, you know. Thinking different like zigging another zag, you know, when we started it was December of 08’, the bottom of the market. People were scared and running away from real estate and that’s when I’m like, there’s blood in the street. I smelled it and I said, let’s dive in head first. So, I think all these comments are, what I would say, persistent, thinking, you know, differently from the pack. Just entrepreneurial and just trying to think differently and have a vision.

Rod: Sure. Let me ask you, the next question is, what do you think is the most courageous thing you’ve ever done, Keith?

Keith: I mean, for most people and for me too, I think the hardest and scariest thing is just starting. Jumping off the edge and, you know, it was so scary. I had no real estate experience and we bought a four-unit building. You know, we scrambled, we got an FHA Loan, we had to borrow money from a friend, we maxed out our credit card. It was very daunting. But, you know, we had good mentors that we really asked a ton of questions to, and held their hands, and just the first, just acquisition, and that whole process was the scariest thing. And looking back, I’m glad we did it.

Rod: Yeah, nice. How about you, Albert? What most courageous move you’ve ever made, you know, if you can remember?

Albert: You know, I think probably just a family story. You know, my father was an immigrant. He came over here from Cuba in 1959, and it’s a story that we’ve retold in our family over and over again over our entire lifetime. And, I think the courage in our family, he gets all the credit, because I mean, I certainly couldn’t have relocated my family at 43’. Not speaking the language and having nothing but the shirt on your back. And that for us and our family has been a guiding light in terms of an inspirational way of life. He’s no longer with us, but his efforts, and what he did, and how he showed us to do things, will always be with us.

Rod: Well, that’s a very modest and humble answer, thank you for that. That’s a beautiful story. Jeff, how about you, buddy?

Jeff: I was actually gonna say, both getting married and starting a family is probably the most courageous thing I’ve ever done. Next to that, every next biggest deal is probably the most courageous thing that I’ve done, that’s kind of happened progressively throughout my life. I was blessed to have a great father who would have encouraged me to do anything. I remember, first getting started in this business as a teenager, I could have asked him anything. “Dad, should I go by the Empire State Building?” He would have said, “Sure, son. Go do it.” And so, I think that the encouragement I had as a young kid is what really, maybe gave me the courage to–

Rod: Yeah. That’s great. Awesome.

Jeff: To jump in both seats and make it happen.

Rod: Yeah. You’re blessed. That’s awesome that you had that foundation. Swapnil, how about you, buddy?

Swapnil: Yeah. You know, similar to what Albert was saying, you know, I’m a first generation immigrant. So, I came here to America when I was 15 years old in 96’. So, we’ve, you know, I’ve done things differently and things have been harder for me than a normal American has been. But it just made me much more stronger, mentally and personally. And I would say the most courageous thing is, when I left my job to start a business. That was definitely the hardest thing.

Rod: Yeah. I’m gonna ask you the next question. Did you have any mentors on this journey of yours and what did they help you with, if you did?

Swapnil: I really don’t. I really didn’t, Rod. Because, you know, my circle– My, you know, people I hang around with have worked their careers in corporate life and had good jobs. So, when it came to entrepreneurship, the only person I can look back to was my dad, because he came to America and he didn’t have any options. So, he had to have run like a small convenience store. But he did it because he didn’t have any other option. For us, you know, who had college degrees and had experience working in corporate America. For us, it was a harder challenge to take on to become an entrepreneur business. To leave that cushy lifestyle, and have money in the bank, and risking it all to start a business. So, yeah. Mentorship, I would say, I’ve built, I’ve established mentors along the way which are mostly my friends, and close friends, and my partner, but to say that I had a mentor, that was who I spoke with before? I didn’t have it.

Rod: Yeah. Okay. How about you, Jeff? Any mentors in your past?

Jeff: Yeah, I think so. I mean, the mentorship that I’ve received over the years has been a tremendous help to me. You know, my earliest mentor was my father. Even though he had literally zero business experience, I think it was– He was just trying to do his best to encourage me and set me on the right path. But, you know, I’ve had a number of mentors and I won’t name any names because they’re extremely humble individuals. I’ve got a gentleman today that we’ve done, you know, hundreds of millions of dollars worth of transactions with, and he’s probably been the biggest impact to my life, professionally. And it’s interesting because if you ask him, he would probably say he’s failed as a mentor. But he keeps pushing me, keeps driving me, and keeps teaching me whether he will admit it or acknowledge it, but he’s been just a huge, huge impact to me. And really helping me see, you know, bigger, better, beyond, not just the big picture, but the whole picture and I think that’s– there’s a big difference between the two. And so, you know, I would say that, you know, aligning yourself with someone who can fulfill that mentorship role is critical for anybody. Whether you’re the President of the United States, whether you’re, you know, the CEO of Amazon or something like that. Everybody needs somebody to push them, to teach them, to mentor them, to help really be a good solid sounding board, and I don’t know how you can really be successful without that in your life.

Rod: Yeah, I agree. You had to go political though, didn’t you? I’m just messing with you.

Jeff: President of the United States–

Rod: I’m just messing with you. I’m totally kidding. Yeah, but you’re right. I mean, we all need people that have no secondary gain from their interaction with us and sometimes it’s hard to find. You know, when you’re communicating with people to find someone that doesn’t have some gain from their relationship with you. But Albert, I think, I know your response here because we’ve talked about it before, but would you share it again please?

Albert: Yeah. My business partner, we’ve been together for over 35 years now. We’re 11 years apart in age. And so, that age difference has always served me well because he had 11 years worth more of experiences. And it’s been very helpful for us in our relationship that we’re both partners and he’s also my mentor, terrific.

Rod: Yeah. Nice. How about you, Keith?

Keith: Yeah. I’d say both my father and then my partner Damian’s father were our original mentors. Damian’s father was very involved. He was doing his own like, flipping homes, and buying some small buildings. And just taught us how to deal with contractors, and tenants, and management companies. And just really on the ground with, you know, kind of stuff. My dad was more of a bigger picture and helped us with like, a lot of the legal work, and just business decisions, and dealing with brokers. And so, we definitely had good mentors. And then later on, we brought on another. We called the “Gray Hair” partners with the experience. Someone else that hadn’t experienced running larger multifamily properties and made him a partner. So, I’d say definitely surrounding yourself with good mentors and partners from the early stage, and your development as a person, and a business person, is very crucial, for sure.

Rod: Great! I’m gonna ask you the next question which ties into, you know, you guys all know and we all know that this multifamily business certainly even in the hundreds of units is, let alone your scale, is a team sport that, it involves other people. It involves bringing other people in. And what I’ve seen a lot with my students and I’m, you know, blessed to say they’re approaching 40, 000 units which isn’t on your scale. But from, you know, for the last three years, that’s not bad. And what I’ve seen is that, you get these people together and each bring a certain superpower to the group, to a team, so they can go out and take down assets. So, they can do asset management, so they can do the due diligence. What would you say, is your superpower, as it relates to this business? You know, what do each of you bring the most of to your– Now, of course, in your cases, you’re all leaders now, and you’re CEOs of your companies. But maybe before you were in that capacity, what role did you see yourself playing? Was it all hats or where is there some specificity? Start with you, Keith?

Keith: Yeah. I mean, in the beginning it was just Damian and I. And he was more of the, I don’t know what you call it, the inside guy dealing with the man, overseeing the CapEx and, you know, the contractors. I was more the outside guy, you know, the broker relationships raising capital dealing with the attorneys, and we continued doing that. And then, we just kept hiring where we had holes. We needed someone that was good at underwriting deals. And then, we needed to, you know, Damian stepped out a little and we hired a project manager. And then we had, you know, someone that specialized in acquisitions and we just kept hiring in places where we felt like we could teach, train, and empower, and then let go and focus on where we can move the needle more. So, nowadays my biggest time and focus is on strategic vision, like where we want to take the company, what kind of, you know, we made a decision to get into self storage, for example, a couple years ago. We started buying mobile home parts, you know. We started a technology company. And then marketing of the business and capital raising, essentially. Raising money from our individual investors, we deal with around a thousand now individual investors. It’s a syndication business, so–

Rod: Right.

Keith: That’s where I’ve put myself because that’s where I’m strongest suited. Just telling the story of Gelt and, you know, empowering the team to do what they’re doing best in their, each division. Making sure they’re working together well, and steering the ship, but really focusing on money raising marketing and sort of strategic vision.

Rod: Nice. Thank you. Albert, I know it’s been a long time since it was just a small company for you, but do you recall when you first started working with your partner? Did you have individual roles or did you guys, you know, did you divide and conquer as it were?

Albert: Yeah. You know, we grew up as, you know, we’re dinosaurs nowadays but we grew up as old-fashioned owner operators. So, there wasn’t anything that, you know, in terms of division of business that, you know, that we wouldn’t do in the day. I do think that growing up as an operator was a distinguishing characteristic for us as a company and not just as individuals. And I think it served us well in our career because it not only is it making us, you know, a good operator in times like this. But I think it’s also made us a good investor because every decision we, you know, we make on the investment side, we have to live with what’s on the operating side. So, I think you know having that dual responsibility of always being both the owner, the operator, and the investor, has really allowed us to really put things in perspective as we go through our business and our investment life.

Rod: Nice. Jeff, how about you?

Jeff: Wow. That was well said, Albert.

Rod: Right, right.

Jeff: I could have sworn he was gonna say his good looks was his superpower, but clearly it’s his wisdom now. I think that– I don’t know, I’ve never really considered myself to have the superpower partly because, you know, in this business or in business in general, I’ve never really considered myself that smart. I just had to outwork everyone else. And so, if I were to have, I guess if you were to force me to identify a superpower probably be my work ethic. You know, coming to the table, showing up to the dance, or whatever you want to call it. With this kind of deep understanding that, you know, everyone else at the table’s more experienced, they’re older, they’re better educated, and they’ve probably got more money than you, really forced me, my only angle, my only option was to outwork them. And so, you know, that’s both my superpower if you want to call it that. And at times it has been my kryptonite because I don’t really know when to stop, you know, it’s literally just a progress.

Rod: Yeah. We’re gonna talk about sacrifice here in a minute. And we’ll circle back to you on that for sure, but– Okay. Fair enough. Swapnil, how about you? Did you find yourself focusing on one particular role initially?

Swapnil: You know, Rod, when I– Yeah. When we started, I was basically doing, you know, sitting at the properties, trying to collect the rents, acting as a manager, drafting company agreements, raising capital, signing on the loans, finding lenders, raising equity. So, I was basically doing everything. What I quickly realized was that, in order for us to grow really fast, if I spend my time in the weeds and managing every aspect of our business as an owner operator, it will limit our growth. So, I would say the decision that I took in 2014, where I didn’t really care about how much money I made. And what I did is, I just kept hiring people to fit the role so that they can manage the growth, because I knew that the timing won’t last too long. We were buying in 2013-14’ as the lenders opened up, as the liquidity came back. I mean, obviously the prices, we’ve seen what happened across the country in the last six, seven years. So, I wanted to go really fast. Go from zero to 20-30, 000 units in six, seven years, which we managed to grow. But I think, for me to be able to not worry about my own personal profitability or my company’s profitability, but looking at a bigger further vision and investing in that vision, I think has paid us back pretty good.

Rod: Nice. So, do you– and this is getting right back to brass tacks, guys. But this is, you know, again, consider my audience. And so, do you, Swapnil, talk about your goal setting process. Talk about how you have done goals over the years and maybe how, you know, how often you do your goals and what that might look like.

Swapnil: Yeah. You know, I’m actually very opposite about that, how to set goals. So for me, there’s big goals, right? I want to have 100, 000 units. Now, I don’t define when, how, where. All I do is, I try to make my actions work towards that goal and I hope that everybody sees how passionate and the work ethic we have to grow that company. And be very opportunistic, right? If I say, today I would love to have a hundred thousand units, but hey, guess what? The opportunities are in commercial office because the cap rates are 9%-10% now. I assume there’s a risk there, but there’s a reason why the pricing is cheap. So for us, it’s about growing where the opportunity is and being opportunistic. So, that’s why I don’t try to limit ourselves by setting specific goals.

Rod: Okay. Well, you named one, hundred thousand units, that’s a goal. I mean, that– Okay. Fair enough. Jeff, what about you?

Jeff: You know, I’ve always– I got an early habit many, many years ago, to sit down at the end of every year and roll out a set of goals for the following year. You know, I’ve always been pretty disciplined at that part of it. Typically, by about mid-year, I’ve forgotten the goals, or we’ve surpassed the goals, or what have you. I probably need to get better at following through with the goals, but I agree with Swapnil, knowing goals can be both good and bad. You know, the ability, or the willingness, or the understanding, that they must be recalibrated based on, you know, the market, the environment, and you know what happens to this and that. And so, you know, we’ve always tried to be as flexible as we can and not let our goals limit us, if that makes sense.

Rod: Well, what are your goals for the future? Let me ask you that and I’m gonna come back to you Swapnil because I would like to know what you guys have planned for the next couple years, let’s say.

Jeff: You know, for me, every year is a repeat of exploring my potential, right? So, I want to accomplish as much as I can, you know, I think that we want to continue to grow the business. We went through an evolution of our organization about four-five years ago, where we really abandoned the original kind of 20-year goal or mindset of being, you know, one of the most active operators in C-Class housing throughout the Southeast. We built the portfolio of 40, 000 plus units. We were buying and selling a lot, so our velocity of both buying and selling was pretty high. I think we got about a five-year stretch of over 8, 000 units a year. And when that was all done, once we kind of accomplished that goal, you know, we were somewhat struggling with, “Okay. What now?” And so, you know, for us, the natural progression was to really increase the quality of our body of work to really evolve from a focus on quantity to focus on quality. And, you know, that’s been our challenge over the last four years in a pre-, what I’ll call, a peaked market cycle. But, we’ve had a lot of success and we’re having more fun today focusing on a much funner quality body of work. And so, I think, for us, you know, the short-term goal is to really perfect that transition or that evolution within the organization, and to accomplish what we did in the middle market C-Class sector throughout the Southeast and beyond in a higher quality sector, you could call it the A-Class sector, but I hate to use that type of terminology. And so, I think that’s probably our short-term goal. But, I think long-term is, we want to continue to build a dynamic organization that everybody who’s a part of it enjoys. We’re delivering value to both our shareholders and our residents, and we’re having fun doing so.

Rod: Love it. Flight to quality and focus on the core. Love it. Swapnil, what are your goals for the future? I’m sorry, I’m not– I’ll get with you, Albert and Keith, in just a second. Same questions.

Swapnil: Yeah. I would say, Rod, my goal is to build a better organization when it comes to management. We all know, as owner operators, when it comes to property management, it is a very difficult business. I know what the issues are, better hiring, better onboarding experience training, and those issues, still exist, right? At least, in my organization. I want to build an organization that– We can’t be perfect. I don’t think any property management can be perfect because the business is just so tough. You’re dealing with people. There’s so many chances for communication gaps and errors. I just want to build a company that gets better every day, at a certain percentage of day, you know, just training better, developing better talent, staffing the properties better, because we all know it comes down to the staffing. If your property’s staffed properly, your regional’s job is easier. Your supervisors, your VP, everybody’s doing a better job, and operations, as we know, is a very difficult business. So, I want to get better because I know the growth is coming, whether it’s 100, 000 units or 200, 000 units. It’s gonna come in a matter of time. I just want to have an organization that can manage that growth in the best way possible.

Rod: Yeah. I love it. You know, every business is nothing but people and systems, and when you dumb it right down. Albert, how about you?

Albert: You know, we’re focused on building a generational business. You know, my partner started our business 52 years ago. We’ve been together for a very long time, and now we’re looking at over the last 10 years. You know, what does our business look like without us, and how do we get this business to a different place? And so, every decision we’re making on the asset composition side, everything that goes into that is really about, can we leave a business that will transcend our lives and it will continue? Because quite frankly, you know, we are fundamentally strong believers that, you know, holding generational real estate for the long term is the best cash flow wealth formula that you could have of any business. I mean, if you look at all investments in all of the publicly traded companies in the United States, you know, all real estate in this country is about twice that number. So, if you’re really looking to build generational wealth, long-term cash flows, long-term perpetual wealth, that you can transcend and pass on to different generations of your family. You know, we don’t see a better place than real estate. So, you know, we’re really right now, about what does it looks like without us, because that’s gonna come sooner more than later.

Rod: Yeah. I love it. And, let me give a kudo to you. So, yes, we’re talking about business development. I want to get into some questions, organizational questions around staffing, and things like that, and KPIs, and things of that nature. But on that note, you know, I was reading the book “Traction”, about the EOS system and your company was one of the case studies in that book which was just awesome to see, my friends. I just want to give you a shout out because we’ve implemented that system in our company as well, and it’s been a game changer. So, do any of the other guys use that at all?

Jeff: We don’t.

Swapnil: No.

Rod: You should look into it, Swapnil. I think you might really like it a lot, and I can send you some information on it. Anyway, Keith, I didn’t want to leave you out of the conversation. And I even forgot the question. Hopefully, you remembered.

Keith: Talking about your goals and–

Rod: Yeah.

Keith: I’d say, you know, originally when we started the business, I didn’t even know how big it could really get and stuff in our, you know, the goal post just kept moving forward. I’m like, “Oh, let’s have a thousand units. Let’s have 5, 000.” So, it’s nice to have those goals. But, yeah. I have like, short-term goals and then every year we do annual goals, and I try to put down like a five and ten year goal. But I agree with Albert that, you know, real estate, you know, is the way I like it, is running it, is buy and hold, and if we do sell, it always try to 1031 Exchange. And, you know, just trying to really grow the portfolio and if we do sell something built in the 70s and 80s, try to upgrade it to maybe 2000 and newer, and just try to grow the portfolio, and that’s why we never wanted to be a fund where we had to like, have a life cycle for things and sell off or have institutional joint ventures where we have to sell in three to five years. And we’ve always aligned ourselves with other investors like ourselves that have long-term, you know, horizon and goals. And I love that real estate can be, you know, generational and passed down, and all the great tax benefits. So, we’ve built the business from the ground of always having individual investors like ourselves that want to create wealth and build it slowly over time, conservatively, with all the tax benefits. And I, also from the beginning, made a conscious effort not to get into the property management business because I thought it would bog us down and I think we’ve able to grow so fast because we didn’t have to worry about having, you know, hundreds of employees and constantly training and hiring and firing and it’s– I like having a smaller team. We have 23 people in our office and, you know, we outsource all our property management to two or three, you know, third-party management companies that are, you know, we work very hand in hand with. So that’s–

Rod: Interesting.

Keith: Yes.

Rod: I think you’re probably the only one on the call that’s not vertically integrated that way. I know, Albert manages all his own stuff. Jeff, you have a management arm as well, yes?

Jeff: We do. Yes.

Rod: Yeah, and at Swapnil, you’re self-managing, correct?

Swapnil: Yes.

Rod: You know, I forgot to ask and I should have asked this starting on. So, where are the bulk of your assets, Keith? And I’m gonna ask each one of you the same question. We have almost half the portfolio in Denver now. It has been our biggest market and we started buying there five-six years ago, so we’ve, you know, entered pretty early in this cycle, doing extremely well. Next up, we have a good presence in Salt Lake City. We’re in the Seattle Metro, Portland, Albuquerque, Southern California. And we exited, we had a big presence in Phoenix, we exited a little early in the cycle, but I feel like better late than never on that one. And then, we had a good presence in Reno that we just sold to our partner in that one. So–

Rod: Nice.

Keith: A lot of major markets.

Rod: Yeah, Denver is my home. I mean, not my hometown but I lived there for 30 years and know it extremely well, and I had 500 houses there at one time. If I still had those they’d be free and clear and I’d be netting about $600,000 – $700,000 a month, and what it could have should have. Anyway, that’s my pain. One of my pain stories. Albert, how about you? I know, is it primarily the I-4 Corridor between Tampa and Orlando? Or–

Albert: Yeah, we’ve done two things over the last, I would say, seven years that have been intentional as part of our generational business. We’ve exited retail, we’ve exited … and we had a huge portfolio of each. And then, we decided to look at where we were best at, in terms of being an owner operator. And, you know, we have two core markets, Southeast, Michigan. We have, you know, we’re the largest operator in the Metropolitan, Ann Arbor Market. And then, the other is Orlando and Tampa, all throughout the entire I-4 Corridor. And those are our two markets today that we are focused on, you know, we have significant market dominance in both those markets. And, you know, markets that we like and we also are comfortable that, you know, they can be with us 10, 20, 30 and 40 years from now. We really are comfortable with the dynamics of all those markets.

Rod: You know, as an aside, just and I wanna ask Jeff, you and Swapnil, but as an aside have you– Well, actually let’s wait on that. I want to talk about the impact of Covid and with Disney and everything in Orlando. I’d like to open that conversation in a minute, but let me ask Jeff and Swapnil where their portfolios are. Jeff, you can go ahead and go first.

Jeff: We’re active throughout what I’ll consider the main parts of the Southeast, United States. So, Florida, Georgia, North and South Carolina, Tennessee, Alabama. Most active in Florida and Georgia at the moment. At one point in time, we had probably assets, I think 10-11 states, maybe five, six, seven years ago. But today, Florida and Georgia probably take most of our time and attention and those are our two favorite markets.

Rod: Okay. How about you, Swapnil? You’re very Texas specific, aren’t you?

Swapnil: 90% is Texas, and then we have Las Vegas, and Salt Lake City, and Kansas City.

Rod: Nice. So let’s– One of the questions that I got from the group and we’ll start getting into some of those was, you know, this whole impact to Covid. There’s a lot of fear with operators right now around, you know, what could be coming down the road. The eviction moratorium, you know, the, you know, the market being so high. And another question was that they wanted to ask if you’re a net seller or net buyer right now. But let’s start with the Covid, the dynamic of Covid. So, Swapnil, if you would go ahead and start, how has it impacted your economic occupancy and what do you see, you know, do you have any thoughts about what’s coming?

Swapnil: Yeah. You know, I think, we were relatively fortunate. So, I think depending as a portfolio as a whole, we were 95% collection from pre-Covid levels. But going forward is, this is what I think, you know. I think that cap rates will continue to compress and pricing will keep going up, and here’s my reason for it, because we know for a fact that interest rates are gonna stay very close to zero for the next three years. So, if you look at the historical data of the last 100 years, you’ll see the delta between 10-year US treasury and the cap rates have always been around 275 basis points. And what we are seeing now is that delta, well, the treasury went up in the last week or so, but the delta is 400-450 basis points now. So, with interest rates, you can borrow currently with agency at two and a half percent, more or less. I think the cappers are coming down in mid-threes which means pricing is gonna, is pretty much loaded to go up quite a bit. You’re seeing lenders coming back, the liquidity coming back, and there’s so much equity waiting on the sidelines from large institutions just to deploy. So, my personal opinion is the pricing is gonna go really, really high and be very aggressive.

Rod: Okay. Thank you. Jeff?

Jeff: I forget what the question was.

Rod: Impact to Covid on your portfolio? And let’s talk about the future.

Jeff: I think the Covid has impacted not just the portfolio, but our entire business. Our strategy since day one was, we really coined the term business as usual. We tried to keep things as usual as much as possible. Of course, we wanted to protect our residents and our teams the best we could, but we kept all of our properties open, all of our leasing offices opened, all of our amenities open. We went on a limb and I think it so far, you know, knock on wood. It paid off pretty well for us. We had a very, very minimal effect at the property level, but still some effect. I mean, we’ve, you know, we’ve seen, you know, bad data collections tick up ever so slightly and in the very beginning it was almost unnoticeable, but, you know, nine months into Covid, even a small fraction of a basis point starts to add up over time. I mean, our portfolio, I mean, ten years ago, our portfolio was running five, seven, eight, ten percent bad debt or collections or delinquency monthly, you know, prior to Covid we were less than less than a percent, right? So, we were measuring it in terms of basis points. That’s grown some, but not– We’re still meeting budget, so our budgets are entered into the system, November of the prior year and we’re still hitting budget at, you know, through end of October for our portfolio, overall. Some a little bit above, some of it below, so I think that’s the good news.

Jeff: Well, the real challenge is, I don’t know how long it’s gonna last, right? And so, you know, if it keeps up like it’s going through next year, end of next year, or 12 months from now, I mean, it’s gonna wreak havoc on the industry. Yeah, you brought up the eviction moratorium and even the forbearance issues and I think that’s just another method of kicking the can down the road. I think that’s gonna create, I think that’s a very dangerous and slippery slope. I think that’s creating a lot of problems, you know, half the folks you talk to that are dialed into the court systems nationwide or especially in our markets throughout the Southeast. They predict that there’s a year plus a backlog on just evictions alone. And so, okay, they open the gates. Come January 1 and you can actually start to file evictions, what happens then? You might, you know, if you’re not already in line or if you’re not sure what to do. You might still be trying to evict folks in 2022 that should have been evicted in 2020. And so, to me that’s a big problem now. It could go either way, right? I mean, I think, you know, any answer I give you, I’m 50% right.

Rod: Yeah. It’s a guess, guys.

Jeff: I tend to take a different approach than Swapnil. I tend to think that, you know, you’re gonna see a really rough road over the next couple years. And I, you know, I think that you’re gonna see a strong difference. I think half the folks are gonna think pricing should be better and I think the other half are gonna be willing to pay a compressed cap rate or what have you. And so, you know, we’re optimistic that we’ll get a better chance or a better opportunity to buy more real estate next year, because of discounted pricing. You know, we already see in a lot of the markets, what I’ll call a “Shift of the Tide”, from a seller’s market to a buyer’s market. Now, it’s a partial shift, you know, half the sellers out there still think it’s end of 2019.

Rod: Right.

Jeff: And half of them are scared to death. And so, you know, I think if you can buy right, you’re gonna find some good opportunities next year.

Rod: Yeah. We’re still buying, but we’re getting a lot more calls from brokers than we ever have. So, I mean, if that’s any indication. Well, thank you. Albert, how about you? What are your thoughts? How has your economic occupancy been impacted if at all and that’s as where I was going with that when, you know, because I know you’re heavy in Orlando with Disney and everything as their, you know, what sort of an impact have you seen?

Albert: Yeah, you know, I would say, well, I can give you an investment view and then I’ll give you an operator’s view, but I would say that Covid has made us a better operator.

Rod: Yeah.

Albert: Forced us to take our business virtually and what I’ve been saying is that, we’ve gone forward 10 years in the last 10 months. So, we are doing things now that I never dreamed of doing and we were forced to do. So, I actually think that Covid has been a great injection to force owner operators to just be better. So I’m, you know, I can go on and on what that means, but I can tell you we have become far better operators in the last 10 months and there are things that we’ve never dreamed of doing that we did do, because of Covid. Now, as to the investment cycle and I can speak specifically to Orlando, but I will tell you in general. I would share Jeff’s beliefs and I do think that we are in the early innings of what will be a very protracted, difficult situation for our industry. And the reason why I say that is that, you know, don’t forget this just started in March of this year. And so, we’re gonna– we’re just eight or nine months into this year’s cycle. You know, if anybody believes that 2021 will not be a fully Covid impacted year, they’re nuts. By the time you, you know, fully discover the vaccine and then you disseminate the vaccine to the entire population, 2021 is lost. What we’re saying internally in our organization, 2022 is lost. You know, we’re sort of looking at 2023 as the first– What I would call “Realized Year Post-Covid.” And I think if you aren’t viewing it that way, you’re probably not doing the right things to get to the other side. You know, we have an enormous amount, not a little amount, we have an enormous amount of set-aside liquidity because, you know, we were there in 1991 and the theme as you remember, Sam Zell and many others, you know, stay alive to 95’. Well, you know, my current theme is stay alive to 23’ because I really think that’s gonna be the first real stabilized post-Covid year. I don’t think it’s 21’ and I don’t think it’s 22’. And as it relates to Orlando, quite frankly, if you look at Orlando as a location to where to invest and we’re talking about two years in the life cycle of a 100-year investment cycle, it’s not material. So, we’re not worried about one or two years will do for us in a market like that. You know, we’re happy to buy as many things as anybody wants to sell on a market like that at the right price. But I will tell you, no. I don’t think, I mean, anybody takes that shorter term view on a market like Orlando then, you know, this is a slow bake business. This is not a microwave business. You can’t get from here to there unless you’re very patient and have a very long-term view.

Rod: Love it and I couldn’t agree more. Doesn’t, you know, I love it. Keith, what are your thoughts?

Keith: Yeah. I share– So, I’d say one, I gotta hire Jeff to manage my properties, because we’re only collecting 92%-93% of rents, so not as good as Jeff’s portfolio. It’s interesting like, we have a few sort of dogs that bring it down. The ones that are more, you know, lower rent blue collar where people couldn’t, where it really works remotely as much, have been affected the most. And the newer buildings, and the better, you know, higher income areas, higher socioeconomic areas have performed better. But like Albert says, our management companies have done a superb job going digital. I’m a co-founder of a financial technology company called “Domuso”, and this Covid has really accelerated our growth tremendously. We essentially allow our clients, which are all property management companies or owner operators to go fully digital with the rent collection processes. And a lot of, you know, unlike Jeff’s management offices, a lot of them here on the Western Coast were closed and they were forced to really go digital and it’s actually been a boon for our residents. We’ve also seen historically credit card, what do you call it, payments for rent has only been usually two percent of all rent payments. It jumped during Covid to around eight percent and a lot of the landlords were eating that, you know, processing fee in order to, you know, get the rent in the door. And we’ve done some tremendous innovation all around the payment of rent and it’s been a huge boon to our business. So, definitely, I think virtual touring, virtual rent payments, all digital, a lot of exciting things that I think will stay, you know, not just now during Covid. And regarding what I see in the future like, I mean, when we’re underwriting deals now, we’re underwriting flat rent growth. So, no rent growth for up to two years and normally we would do market rent growth of like three percent a year and that’s really hurt us when we’re trying to buy deals, because I don’t know what our peers are doing but like, they’re able to pay more for stuff and we’ve been outbid left and right. We’ve also ratcheted up, you know, the amount of bad debt and just the amount of concessions in the marketplace and I think also, we’ve been doing it for a year and a half to two years, like Albert says. So, but like one of my mentors always says, like, he tells his investors, the building we’re buying now? Yeah it’ll probably be worth a little less a year from now, two years from now. But in five years from now, 10 years from now? That the rents are gonna be much higher, the value is gonna be much higher. It’s a long-term game, so I like Albert are, you know, we’re still buying but selectively. We’re able to pay a little more if we’re selling something and exchanging into it, but it’s very difficult still to buy. And I have long-term, you know, optimism. Short-term, just caution.

Rod: Yeah. All right. Good. And so, tell me about– and I’ll let you answer the next question, Keith. Tell me about your biggest failure, or lesson, or seminar I call them, that you had in this journey of yours and this is a question that came up quite a bit from my people in the audience, you know, talk about a lesson. So, what comes to mind when I ask that question?

Keith: Yeah. I’d say, early on I learned that just because something’s cheap doesn’t mean it’s a good deal. We were buying in the roughest parts of town and, you know, it was so cheap per unit and on paper it looked great. But technically, it was really tough to make good returns because we had such high turnover, and we had to do a ton of evictions. And just, you know, it was the tenants were, trashed the units and we had to spend a lot of money renovating them, and it was just a tough learning experience. So, we started paying a little more to buy in better areas and maybe on paper, the returns didn’t look as good but still in the long run, they’ve actually performed even better. So, I’d say, just, you know, one of the reasons, yeah, one of the learning experiences just because something’s cheap, doesn’t mean it’s a good deal.

Rod: Okay. Thank you. Albert, how about you? Lesson or seminar.

Albert: You know, there was a point in time where I lost a very significant amount of money in one transaction. And at the time, I thought it was gonna be catastrophic, and the amount was $10 million in a single transaction. And so, looking back on it now, it was one of the best things I ever did and that sounds funny to your listeners, because one, I had to do a lot of different things to come back from that. And two, I’ll never forget that experience and so, it is a learning experience. It’ll be a very painful one. So, I think that there are points in time where you make such a catastrophic mistake. That you either persevere and persist as an entrepreneur and as an investor, or you fold. And so, but if you don’t fall and you can persist then, you can come out the other side a much more knowledgeable and a much more, I think, intellectually thought-based investor.

Rod: Nice. And I can certainly relate, because I lost $50 million in 2008. But it was– Yeah. Anyway, it is very sobering, and humbling, and educational for sure. Thank you, Albert. Jeff, how about you, buddy? Talk about a seminar, all right?

Jeff: Well, I would certainly agree with you. The wounds from 2008 are still fresh. They haven’t healed, that’s for sure. And so, I don’t know that I’m ready for that again but certainly would love to take advantage of another opportunity to go on one heck of a buying spree. The, you know, lessons learned I think for me probably the hardest lesson to learn was, you know, I spent the first 10 years of my business trying to figure out how to grow it. You know, to me, it was a monopoly game. I wanted to buy everything and anything and my biggest challenge was access to capital, you know, like many or most small businesses, you know, being capital constrained is a challenge. And so, but once I figured that out, once I understood and began to understand capital markets, and figured out how to access capital, then it was a whole new problem. And we started to grow and grow and grow like game busters. And so, you know, the big lesson there was, you know, growth is easy. Managing growth is hard. And so the, you know, the concept that you learn as a kid, right? You know, all growth spurts are typically followed by growth pains. You’re really managing growth, you know, for sustainability. Was probably the hardest lesson to learn. You know, we, of course, learned the lessons that, you know, Keith mentioned about. You know, just because it’s cheap doesn’t mean it’s good. You know, one small comment to that, you know, 15-20 years ago, the cheap markets or the bad air, I mean, the entire economy was different, the world was different. You could, C-Class multifamily was ran differently and a lot of the country, you know, never really fully recovered. A lot of the rental demographic never fully recovered from the last downturn in the market. But I think, you know, for me, just controlled growth, you know, resisting that urge and that desire, even that ability to just grow wildly or rapidly, was probably the hardest lesson to learn.

Rod: That’s been a common theme, you know, with you guys like, maybe with the exception of Albert, because, you know, he’s been at it a lot longer, but fair enough. Swapnil, how about you?

Swapnil: Yeah, you know, for me, I would say when it came to, you know, the whole business plan, the thesis was buying value-add multifamily class B apartment complexes. So, that whole concept about value-add was always and still is to an extent where you’re rehabbing a unit with $8,000 or $9, 000 or, you know, a unit you’re putting new floors and you’re trying to get some red bumps in return, right? I would say that it’s a lot harder than being said and we’ve learned that in the last five years.

Rod: I’m sorry. A lot harder than what? Forgive me.

Swapnil: In asking the reality, It’s not– I’m going to achieve that rent bumps and especially if you are gonna be very stubborn about, I’m only gonna lease out these units at these rents, then the issue is, you’re gonna have a lot of move outs, and your movements are gonna be minimized, and you’re gonna see a drastic drop of occupancy. So, over the course of time, you’ve learned to be less stubborn about the rent bumps and what actually we call and define, value-add. That’s what would be the biggest learning for me.

Rod: Interesting. Okay. So, let me ask you this now. How big is your organization? I know you have a management division as well. How many employees under your whole umbrella?

Swapnil: Yeah, we have 800 employees, and we have 65 in the corporate office.

Rod: Okay. How do you, and I would like to ask all you guys this question. It ties into the conversation that I’ve mentioned about that book “Traction” and “EOS”. That’s kind of one of the ways that someone can do what I’m gonna ask, but how do you hold your team accountable? And I would love to– I don’t want to go too micro, but a little bit micro and maybe, how is an organization, you know, do you have, you know, is there a hierarchy and and how the whole company, you know, is held accountable and everyone in it?

Swapnil: Yeah. I would tell you Rod, that is probably one of our biggest weaknesses.

Rod: Okay.

Swapnil: Because the way we’ve grown so fast and I’ve entrusted a lot of key executives that I’ve known from my past life and my past friendships. I just don’t have the time to micromanage, and hold them, and follow up with them. And I think it’s probably because of my nature and personality and the growth that I’m envisioning. I don’t get to, I don’t– I haven’t put those accountability procedures or systems in place. And that’s the area we really want to get better. But as of now, I think it comes down to your own individual and executive passion, and your allegiance to you and the company which is what a lot of them are holding themselves accountable for. But, as a CEO, I think it is one of my biggest weaknesses to hold people accountable.

Rod: Well, I’m very, very impressed with your, you know, vulnerability there. And I do and we are gonna talk offline because Albert, I think can speak to how powerful, you know, that EOS system is. And, you know, Albert in fact, let me skip just a second, Jeff. So, can you speak to a little bit? Because I know it’s been great for us.

Jeff: Okay. Well I don’t, I think–

Rod: This is like a commercial for it. Sorry, I didn’t explain.

Jeff: I’m not familiar with the system actually. I’m taking notes because like Swapnil, we– I’m still learning how to hold people accountable. I would literally identify it as our strongest weakness as well. Both the desire to grow rapidly, the desire to create, you know, good, fun, friendly relationships with your team. And just the, you know, the naivety of not understanding how important accountability, and boundaries, and those types of things are to an organization that’s growing rapidly. And so, you know, we clearly understand that it’s a big, big issue and our next round of growth will be impacted much differently by it than our last round of growth but we’re struggling with it. And so, when you’re talking about this EOS system, it’s something I’ve never heard of but I’m taking notes on that.

Rod: Yeah.

Jeff: I’ve got to learn something new everyday, right?

Rod: I’ll get you some more information about it as well. I didn’t know that I’m actually kind of surprised to hear that which is based on that, the level of success that you guys have. But Albert, could you speak to your experience of it just for these guys? Since, they’ve got you on the call here?

Albert: Yeah. You know, it was transformational for us as a business. We were, I think, Gina Wickman’s first or second client when he was starting his consulting business. So, we were in there on the ground floor that’s why we made it into the book. But we’ll say and we’ve morphed one or two iterations since then. But the fundamental concept which still stands today in our business is that, we have what we call “CEO Team One.” It is a CEO leadership team, it’s nine individuals. Those nine individuals either win together or lose together, they have one focus. They’ll get up every single morning and they do nine different things but only with one outcome. And so, we hold them all collectively accountable. There is no one up or one down. It’s either you all win or you all lose. And I think so, what we learned in our days with Gino was until we got everybody together on one outcome, one focus, one thing that we do well, and only one thing that we do well? Then, all of a sudden things changed because there was no more pointing of fingers, there was none of those things. So, you know, we’re very focused on what we call “CEO Team One”. You know, we get together regularly. We get together every Monday, every Friday and everything that we do is CEO Team One oriental. There is no individual goals. It’s all collective outcome.

Rod: Love it. And, yeah. And guys, that’s probably one of the biggest things in that whole process. And I’m sure there are other processes like it. There’s that book of the “Rockefeller” habits, that kind of precursor to “Traction”. But let me just say one last thing about it, and that is, you know, one of the things they have you do is instead of an org chart, you actually do an accountability chart which is fascinating. Okay? Because it’s completely different than an organizational chart and– But anyway. I don’t want to belabor this. But Keith, do you have anything to add to this, you know, this accountability for your team conversation?

Keith: Sounds like I gotta go buy this book “Traction”.

Rod: All right. Now, I don’t want any of you to get it. It’s gonna come as my gift to you along with some other materials that I have. But, yeah. Sounds great. So let me, Keith, you can answer the next question. Who is the person alive or no longer alive that you admire the most and why?

Keith: Oh man, the one person like in business or in life? I mean–

Rod: It doesn’t matter. Just whatever comes to mind, the person that you admire in your life the most and why?

Keith: I’d say, the person I admired that had the biggest impact would be probably my grandmother, who’s a holocaust survivor and came to this country also with nothing. And you know, really was the matriarch of her family. And you know, she really was a strong, strong woman. She passed away a couple years ago at like, 99 and her biggest thing was just family. And really loved her family and wanted the best for everyone, and just getting us together. And I think that, she was probably the, you know, the strongest person who made all this happen. Without her and her tenacity and courage, we wouldn’t all be here, so.

Rod: Wow! That’s beautiful. Albert, how about you, my friend?

Albert: Colin Powell. I mean, if you learn anything about leadership, read about Colin Powell and his life. And it’s– he’s absolutely terrific.

Rod: Wow! Thank you for that. I’ll go get his book for sure. Jeff, how about you, buddy?

Jeff: You know, that’s a tough one. I’m gonna stick with my father. I think he is the man who made me the man I am today. And you know, unfortunately he passed away at a young age and so, you know, that probably left a lot of want and desire in that relationship. And I would certainly, I think that he’s probably the most appropriate.

Rod: Okay. Thank you. Swapnil?

Swapnil: Yeah. For me Rod, I would say, Alibaba CEO, Jack Ma and then, Elon Musk for me has been–

Rod: Yeah. Jack Ma from Alibaba?

Swapnil: Yeah. Jack Ma and Elon Musk have been–

Rod: Yeah. Elon, for three startup billion dollar companies? That’s pretty freaking impressive. All politics or anything else aside or, you know, personal feelings aside, he’s one of my heroes as well. I love it. Okay. Yeah, and Jack Ma is such a humble beautiful leader as well. Those are great choices. Do you have a favorite quote?

Swapnil: I think I have to think about it.

Rod: All right. You think about it. I want to ask you the next question and that is, you know, do you have a set in stone planning process that you go through on a regular basis? And you do. All right. Talk about that for a moment.

Swapnil: Yeah. I think it has to do personally. So, waking up having the right mindset, spending some time, you know, meditation, then working out, so making sure my health isn’t top-notch, having that clear mind. So, the quote that you asked just came to my mind. So, my favorite quote is, “My biggest battle, my biggest struggle is through my own mind.” If I can conquer my own mind, I think everything else is easy. So, the quote that I like is, “The mightiest warrior who conquers his own mind” Right? Who has the ability to conquer his own mind. So, for me, it’s just, how do I get my mind? How do I get my brain in the best possible shape, to make the best decisions possible? So, for me, it’s all internal. For me, it’s about how to have the best health physically, how to be in the best shape, how to have a right mind so I can make the clear and right judgments and make the right course.

Rod: Nice. Yeah. I interviewed Hal Elrod on my show, beautiful guy. I wrote the book called, “The Miracle Morning”, about, you know, waking up early, exercising, journaling, meditating, or prayer. And yeah, he’s that awesome. Awesome answer. Jeff, what about you? Do you have a specific planning process, or morning ritual, or something that you could share? You know, I know my listeners would love to hear that about this from each of you.

Jeff: You know, I don’t– I mean, I’ve read a lot about, you know, everybody’s morning routine and the importance of a morning routine. And I think it’s fanciful to follow them. I’ve hired a lot of guys who tell you they’re in the gym by 3:30 in the morning and, you know, they meditate, and they pray, and they do this and they do that, and they’re in the office by 5:30am. And I’ve never met anyone who actually does that but I mean, for me, you know, my routine is, you know, I wake up early, I put two feet on the ground, and I race to the finish line which is the same spot I woke up in that night. And I try to go as hard and as fast as I can until I just can’t go anymore.

Rod: So, I want to dig just a little bit deeper on you, since you answered that way. What’s the drive there? What’s driving you to work that freaking hard? I’d love to hear from each of you. Really, what is driving it, you know?

Jeff: I don’t know. I’m still trying to conquer my mind, like Swapnil said. And so, I think, you know, I agree wholeheartedly with him. Your mind is either your biggest liability or your biggest asset. It’s either in your way or it’s not. And so, you know, I don’t. I can’t really tell you. I’ve tried to figure that out, you know, I don’t want to dig too deep because then it might change. I’m happy with the way it is and I don’t really, necessarily need to understand it. I’m just trying to fine-tune it, and tweak it, and get the best out of it. If you know what I mean? I wish I could tell you it was, you know, three and a half cups of coffee but it’s far more than that.

Rod: Fair enough. We’re just trying to share some insights, get some nuggets, you know, people that are– that see you guys up there, you know, on this pedestal and are trying to figure out their own way. And if they can get some tips, that’s the reason I’m asking these questions.

Jeff: Yeah. Look, I think it’s a weird mix of obsession, and intensity, and competition, right? Because I’m like, I don’t know where the nearest competitor is but I know he’s right behind me. If I don’t stay ahead, he’s gonna pass me and that’s a big problem for me.

Rod: So, that’s a big one for you, it’s competition. Albert, how about you my friend?

Albert: I just loved listening to what Jeff had to say. It was terrific. I was, well said. I’ll just do a quick follow on that, my favorite quote is, “The harder you work, the luckier you get.”

Jeff: I’ve got a few guys in my office that use that on their email signature. So–

Rod: I love it.

Jeff: And that quote, that statement sure is true. That’s for sure.

Rod: How big is your organization Jeff?

Jeff: We’ve got about 400 employees today.

Rod: 400.

Jeff: About 1100, about five years ago.

Rod: Okay. And Albert, you’re over a thousand, I know, how where are you at?

Albert: Yeah. We’re big.

Rod: Yeah. Okay, fair enough. Love that. Love the humble. Thank you. Keith, what’s your favorite quote?

Keith: So, I got two quotes. One is in my signature line that my cousin came up with. He says, “Success is built on delusional optimism, paranoia, and an inability to quit.” So, that’s one of our quotes. And then, I’m like, this is my business card, so “gelt” means money in Yiddish. And this here says, “It’s better to regret not buying a deal than buying a deal you regret.” So, that’s another one we got. And then, I don’t know, what drives me? I take a little different approach from Jeff because I like real estate in that it’s so huge, it’s not like a tech company where there’s one or two winners. It’s like, there’s enough of it out there for everyone to become wealthy. And it’s about– and like, having enough like, just cash flow to live your life however you want to, free to have freedom of time, freedom of thought, freedom to spend time with friends family. And I just like creating, that’s a big theme my wife and I. We like, we work together pretty much and we create. We create buildings, we create communities, we just make the world a better place, create companies, invest in other entrepreneurs that are doing really cool things. So, I’d say, creating, building and empowering is just the freedom of having enough money coming in to do whatever I want.

Rod: Beautiful. Well said, buddy. Well said. Okay. So, last question just to leave my people with a gift. Give me your two favorite books of all time, and you can go ahead and start Keith.

Keith: Of all time, Jesus.

Rod: Or two or three, whatever. If it’s just one, it can be one. But just–

Keith: I liked the book recently I just read, “The Psychology of Money” by Morgan Housel, that was a really interesting read and I learned a lot about that because I am sort of fascinated with money and accumulating. But it’s like, “Why?” And, you know, they had some good–

Rod: Yeah. And your thing about “gelt”, I felt in Dutch, “geld” is money too. I’d even pick up on that translation on that. That’s funny, I didn’t catch that. But anyway. Okay. Awesome. Albert, how about you?

Albert: Gosh. That’s a tough one. I have a lot of different things that I like but I will– I’ll just continue with my Colin Powell theme. He has so many good books. I read them, I reread them all the time. So, I urge any of your listeners to pick his books up.

Rod: Okay. Colin Powell’s books. Awesome. Jeff, how about you?

Jeff: Rod, I hate to admit it but you were breaking up when you asked the question. I assume it’s no kidding.

Rod: Gosh. Yeah. I was asking, what the two favorite books are? I must be having a little interference here, my apologies.

Jeff: You know, I don’t have one. I’m not a big reader. I hate to say it. I wish I had more time to read. I know it’s an instrumental in your growth as an individual and a business leader. Unfortunately, I don’t have enough time to read. So, I don’t have a favorite book or a set of favorite books. I probably spend more time in the Bible than any other book ever.

Rod: There you go. That’s an answer right there.

Jeff: That’s about the only time I could make to read. Be honest with you.

Rod: Okay. No, that’s a good answer. That’s the ultimate book. Swapnil, how about you?

Swapnil: My favorite book is the book I read by growing up. It’s from Paulo Coelho called “The Alchemist”.

Rod: “The Alchemist” Yeah. It’s beautiful.

Swapnil: Yeah. It’s still my favorite.

Rod: Okay. Well, listen. I hope you guys have enjoyed this as much as I have. I mean, and guys, you guys listening for them to come on here and share their time with you, speaks to the hearts that these guys have. That they’re here for no other reason than to add value to you guys. It is my absolute honor and pleasure to know each of you and I’m very grateful for you to come on for this very special episode of my podcast. And wonderful to see you all again and I’m sure that we will talk again, you know, very very soon.

Ads: Rod, I know a lot of our listeners are wanting to take their multifamily investing business to the next level. 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 a thousand 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 41411. That’s “mentorwithrod.com” or text “crush” to 41411.