Passive Real Estate Strategies: Investing in Syndications and Funds

Are you ready to learn how to maximize your ROI? In this episode, Justin will be discussing how to create value in commercial real estate. He'll share the one strategy that we use across all of our properties, which recently resulted in a 784% ROI on an acquisition. Our host and managing partner at Realm Investors, a multi-family syndication group, will explain how to increase net income through increasing revenue without increasing expenses or decreasing expenses without decreasing revenue. He'll also discuss how a small swing in net income can make huge impacts on the value of a property and provide an example of one huge move with our recent acquisition. Finally, He'll share our strategies for cutting down on utility costs and why this is so important for reducing expenses and maximizing your ROI. Tune in now to hear all about creating value in commercial real estate!

Key Highlights:

[00:01 - 04:24] Cutting Down on Utilities in Commercial Real Estate

• Creating value in commercial real estate is all about increasing net income 

• Values for multi-family assets are applied with a cap rate 

Key Quotes:

"Creating value in commercial real estate is all about increasing your net income." - Justin Moy

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Are you interested in navigating real estate? In this episode, Glenn and Amber Schworm share their knowledge and experience on how to build passive income through real estate flipping. With over 850 homes flipped and 85 million dollars in investments, the Swarms discuss how to use active strategies such as house flipping to create passive income. They share examples from their own business such as a property that went from 12,500 dollars to 75-80,000 dollars and provide advice on how to make sure you're not getting in over your head when starting out. Additionally, they discuss the importance of understanding your target market when flipping a property and provide tips on features that can make a house feel custom without being too expensive. This conversation provides valuable insight into how to successfully flip houses while creating passive income and is a must-listen for any real estate investor.

Key Highlights:

[00:00 - 06:32] Learn How to Strategize Value Add Strategies and Build Wealth During a Recession

• Passive opportunities exist within the home flipping space, such as short-term rentals

• In 2007, bad lending practices caused the recession; this time it is due to free money pumping the economy

• Layoffs are happening and prices are already going down a little bit, making it a great time to be a real estate investor

[05:42 - 12:58] Making Money in Real Estate: The Birth of the Everyday Investor and How to Find the Money to Build Your Income Stream

• You don't need your own money to invest in real estate

• Real estate is the only investment where you can have other people pay for it

• Passive income gives you a lifestyle you wouldn't think of in advance

• Short term rentals generate 5-7 times more revenue than long term rentals

• When flipping, look for a good profit margin and know your numbers going in upfront

• Start with something that just needs cosmetic repair instead of major repairs

[12:59 - 19:08] Finding Off-Market Deals in Any Economy: 15 Strategies to Make Money with Real Estate

• Off market deals are where the money is

• Look for vacant houses and talk to neighbors to find deals

• Common motivated sellers include those facing death, disease, divorce, downsizing, dilapidated, disgusted or destination

• Value add strategy involves modernizing a property on a cosmetic level without breaking the bank

• Focus on first time home buyers as they are the majority of buyers in today's market 

• When renovating, focus on making the house feel custom without overdeveloping for the neighborhood

Key Quotes:

"If you spend a dollar, you get a dollar fifty back no matter what you look at." - Glenn Schworm 

“If you're in this to make a profit, you have to stick to those hardcore business decisions.” - Amber Schworm

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Are you interested in the most common metrics used? In this episode, Justin discusses the most common metrics used to project returns on real estate deals and how they can be used to mask weak returns. He will be exploring cash on cash, cap rate, and internal rate of return. He'll explain how cash on cash is calculated by dividing the annual cash flow of a deal by the amount invested and can show an average return even if no cash distributions were made for several years. We'll also cover cap rate which is calculated by dividing the net operating income (NOI) by the purchase price plus closing costs and can also be used to mask weak returns. Finally, we'll look at internal rate of return (IRR), which assigns time value to cash returns and weighs earlier distributions as more valuable. He'll also discuss equity multiple, a metric used to measure the returns of an investment, but does not account for the timeline of the investment. This episode will provide listeners with valuable insights into how metrics such as these can help investors identify both strong and weak investments. Tune in for an engaging conversation about real estate metrics!

Key Highlights:

[00:01 - 06:35] Uncovering Weak Returns: Analyzing the Most Common Metrics Used to Project Returns on Deals

• Cash flow may not be even in a property unless it is a loan position or debt investment

• Investors should look at all three metrics in their entirety to get a full picture of the investment

Key Quotes:

"One thing that many investors don't consider is that I R R tends to carry more risk." - Justin Moy

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Are you interested in analyzing the inflationary market? In this episode, Patrick shares his journey to success and explains how he employs various investment strategies such as multi-family real estate, oil and gas, and 1031 exchanges to achieve financial freedom. With the right skillset and partnerships, investors can access a variety of opportunities to increase their wealth. He emphasizes the importance of investing in subsidized housing which can provide government-guaranteed rental increases and protection from interest rate risk. Through this conversation, you’ll learn about alternative assets that are available for investors who are looking for better returns on their equity as well as tax incentives provided by the IRS that allows them to deduct intangible drilling costs and take passive losses off of their ordinary income. Tune in to find out how you can use your superpower to make your money work for you!

Key Highlights:

[00:00 - 05:42] From High Tech to Real Estate: Patrick Grimes Shares His Journey of Becoming a Multi-Family Syndication Group Founder and Managing Partner

• Patrick Grimes is the founder of Invest on Mainstreet.com, a private equity firm with the mission to enhance busy professionals' quality of life by providing tax shielded and inflation hedged passive investments

• He has been in this game for over 15 years, getting into real estate in 2007

• He was encouraged to diversify into real estate early on and got into single family pre-development personally guaranteed high rate returning deals

• His mission now is to help other busy professionals join the passive side of real estate investing

[05:42 - 11:05] Partnering to Scale: Unlocking the Benefits of Multi-Family and Oil & Gas Investments for Maximum Cash Flow

• Advice to partner sooner for more time to focus on one's superpower 

• Passive investing provides better diversification and return on equity

• Oil and gas investments provide tax advantages, cash flow and appreciation

[11:06 - 16:35] Investing in Oil and Gas: A Definitive Guide to Unlocking Tax Benefits and Cash Flow

• Subsidized housing allows for government guaranteed rents and rental increases

• Diversifying across hundreds of homes eliminates single point of failure issue

• Cash flow is high in the areas where houses are purchased

[16:36 - 21:50] Unlocking Tax Benefits with Oil and Gas Investments

• Partnering with a company to purchase leases in order to drill for hydrocarbon 

• Looking for investments that are not fraudulent, have low risk, and will follow through 

• Drilling in proven locations with horizontal wells that can go down a mile and out a mile 

• Tax benefits of oil and gas are huge; investors may get back 30% of their investment when filing taxes 

• Investment incentives change depending on the needs of the country 

Key Quotes:

"Everything comes from overseas." - Patrick Grimes

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Are you interested in knowing about REIT in the volatile market? In this episode, Justin dives into the impressive performance of private REITs, which have outperformed public REITs by 41.3% through Q3 of 2022. He also discusses how returns are gathered and the structure of private REITs, which is seen as a downside but here, helps their returns tremendously. Learn why private REITs have been able to hold onto more cash in 2021, what factors make them more shielded from the volatility of the public markets, and how they limit withdrawals compared to public REITs. Plus, find out how this gap between the two types of REITs could shrink back to a normal rate in 2023 and how each might slightly outperform each other month-to-month.

Key Highlights:

[00:01 - 05:46] Private REITs Outperform Public REITs 

• Structural differences between public and private REITs explain the performance gap

• Passive investors can benefit from the differences between public and private REITs 

Key Quotes:

"Private REITs are greater shielded from the volatility of the public markets and public REITs are more exposed despite their properties and their portfolios still performing on par with private REITs." - Justin Moy

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Are you interested in moving from a single-family home deal to a multi-family home deal? In this episode, Arn shares his journey from selling single family properties across the country to transitioning his portfolio into multi-family investments and managing a portfolio just shy of a hundred million dollars. He also dives into his experience self-managing his single family portfolio and why he decided to transition out of it.  Arna also encourages passive investors to think long-term, adopt a dollar cost averaging approach and pay attention to the market they are investing in.

Listen and enjoy!

Key Highlights:

[00:00 - 07:07] Four Decades of Real Estate Experience: Arn Shares His Journey from Single Family to Multi-Family Investing

• Arn has over four decades of experience in the real estate industry

• He transitioned his single family portfolio into multi-family properties and currently manages a portfolio just shy of a hundred million dollars

• He started buying single family homes in the Bay Area in the late 70s/early 80s

• He was able to self manage most of his properties, but hired third party management for those across the country

[07:08 - 14:11] Investing in Multi-Family Properties: Tips for Vetting Operators and Maximizing Returns

• Return on equity is an opportunity cost to not sell a property

• Invested in 800-1000 units in the southeast, mountain west, and other regions

• Pick a sponsor with a track record in the type of property they're trying to fund

• Rely on life experience and intuition when vetting operators

• Don't go all in with one operator on first deal

[14:12 - 20:45] Navigating Real Estate Investing: A Long-Term Perspective for Successful Returns

•  Different classes of apartments, business plans, and tenants require different operators

•  Real estate cycles typically follow a 5-6 year upswing, slight downturn, and 1-2 years of flat

•  Don't focus on timing the market, but rather time in the market

•  Long-term investors don't need to worry about downturns as they can still rent properties out and cash flow

[20:45 - 26:42] Unlocking the Secrets of Passive Real Estate Investing with Spark Investment Group

• Preserving capital for own deals is best way to compete in this space

• Buyers with cash and ability to move quickly will be in a better position to win deals

• Dollar cost averaging is a good model to follow for real estate investments

• Investing $50,000 a year over 10 years can create significant wealth and cash flow

• Invest in strong markets with population growth and multiple sectors of employment

Key Quotes:

"So have a long-term focus and don't be too distracted by the little momentary up and down and turbulence." - Arn Cenedella

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Are you interested in making deals in real estate? In this episode, Justin discusses the three key criteria to look for when evaluating an investment opportunity as a passive investor. We dive deep into rental comp delta, which is the difference between market rents, comparable rents and a property's current rents - a large delta indicates more potential for return on investment but also means more time and effort may be needed for renovations. Listen and enjoy!

 Key Highlights:

[00:01 - 08:03] Discover the Benefits of Passive Real Estate Investing 

• Markets have been flooded with operators who are comfortable overpaying for properties

• Focus on operations of properties rather than what other operators have done

 Key Quotes:

"When it comes time to sell or buy, every property has a different story." - Justin Moy

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Looking to diversify your investment portfolios while earning superior risk-adjusted returns? In this episode, Ash Patel shares his experience investing in every type of asset and walks us through some of the most important points of being a passive investor. In the 10+ years since his first property, Ash went on to purchase retail, industrial, warehouse, mixed-use, restaurants, medical, office, etc. The commonality in his deals is extraordinary returns beyond what Multi-Family properties can produce. He has invested in over 30 properties with a total value of over $50mm. Let's dive in!

Key Highlights: 

[00:01 - 06:05] Opening Segment

• Ash's background and work in passive real estate investing

• His experience as a commercial real estate investor

• How to deal with problems and communicate with investors

• Three issues that Ash had with a property that ended up costing you money and were unforeseen

[06:06 - 10:22] Being a Passive Investor

• Why do returns on the LP side kind of diminish and lower?

• Raising money for your non-residential

• Make sure you reward your passive investors upfront

• Why Ash's only metric cash on cash returns

[10:23 - 16:54] How to be More Sophisticated in Real Estate

• Is it safe to be asset agnostic?

• If you're going to be passive, attempt to diversify to some extent

• Why Ash loves tertiary markets - unsexy markets

[16:55- 24:29] Closing Segment

• The importance of upfront due diligence

• It's important to collaborate with other investors on your deal

Connect with Ash:

Invest Beyond Multifamily (Website)

Ash Patel (LinkedIn)

Key Highlights:

"Losing money's part of the deal." - Ash Patel

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Do you really understand how to evaluate an investment so you can tell if it is good or not? In this episode, Justin delves into the key criteria for assessing if a deal is good or if it has some red flags. He discusses why it's important to consider utility and insurance expenses when looking at a property purchase and stresses how to analyze rent growth projections and exit cap rates. Justin touches on how rising interest rates affect projected returns and how past indicators are not always indicative of future performance. Tune in for an in-depth discussion about passive real estate investing!

 Key Highlights: 

[00:01 - 06:14] Uncovering the Secrets of Good Deals

• How to tell if a deal is worth investing in

• Key factors to look for when vetting deals

• How to analyze insurance express, income projection, and cap rates

• Operator's key assumptions and projections to review

[06:15 - 11:58] Analyzing Rent Growth Projections for Real Estate Investment Returns

• Past indicators are not necessarily a predictor of future performance

• Be cognizant of rent growth as it can throw off increases for the life of the property

• Consider the sustainability of the operator's rent growth projections

• Organic rent growth, exit cap rate sensitivity analysis, and time to hit proforma

Key Quotes:

"Just because you're buying the deal at a 4 cap doesn't mean the market is at of 4 cap." - Justin Moy

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!

Have you ever wondered how to leverage passive investing? In this episode, renowned author, entrepreneur, investor advisor, and co-host of the Bigger Pockets Business podcast J Scott joins to discuss how investors can maximize returns while mitigating risk. With his 140 million portfolio career, J provides valuable insights into unique deal structures now available to investors and outlines the importance of focusing on one thing and investing passively in other ventures. From debt investments to equity investments to preferred equity structures, this conversation provides a comprehensive overview of the different ways investors can get involved with real estate deals. Whether you’re just starting out or are already experienced in real estate investing, this episode has something for everyone. Join us in this informative and engaging discussion with J Scott!

Key Highlights: 

[00:01 - 05:43] Opening Segment

• How J Scott has accumulated over 140 million in a portfolio career

• Focus on one thing and do everything else passively

• What to consider when investing passively in flips

[05:44 - 10:53] How to Achieve Exponential Growth

• The difference between debt and equity investments

• J's advice for passive investors

• Reinvest profits and give it time to see exponential growth
• Seek out higher-return investments

[10:54 - 16:10] Navigating the Market Cycles

• Syndications, funds, and private money lending offer opportunities

• The syndications’ structure vs a rental business 

• Real estate investment can be accessible to everyone regardless of knowledge, time, or money 

[16:11 - 21:24] Protecting Investors Through Preferred Equity Deals

• Underwrite deals conservatively, even during great economic times

• Assume worst-case scenarios for rent growth, cap rates, and interest rates

• How the preferred equity layer is becoming popular to protect investors from additional risks

[21:24 - 26:48] Closing Segment 

• How funds can provide more buying power and allow investors to get in for a much lower investment amount

Connect with J:

J Scott (Linktree)

Key Quotes: 

"The best way to scale, the best way to grow is to focus your time and your efforts on whatever that one thing that you're great at and then try and do everything else passively." - J Scott

Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.

Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.

Want to invest with us? Schedule a brief call here. 

Get in touch: [email protected] and let me know what topics you’d like me to cover or what guests I should have on.

If you like our content, please give us a rating on the platform you’re listening on!