Real Estate Underground

Amar Patel is a CPA and one of the partners at KBKG, where he heads up the Southeast cost segregation practice out of Atlanta. He spends his days inside other people's depreciation schedules, and the first thing he looks for is one line labeled "building" being written off over 27 and a half or 39 years. His point for anyone who skipped the study at closing: "It's kind of a common misconception in the industry... cost segregation needs to be done in the year I buy an asset, and that's not necessarily true."

Amar walks through the look-back study, which goes back to a property you've owned for years and pulls the missed depreciation into the current tax year without amending a prior return. He also explains why he rarely looks back past 2018 on acquired property, and what the IRS takes back through recapture when you sell.

What Ed and Amar get into:

• How a cost segregation study finds the parts of a building that depreciate over 5, 7 and 15 years
• Why part of the electrical that feeds the refrigerator can depreciate with the refrigerator
• Recapture, and why Amar asks every client up front whether they'll hold the property past three years
• The look-back study on a building you already own, and where Amar draws the line on how far back to go
• What happens to the strategy if bonus depreciation changes with the next administration
• Short-term rentals, passive losses, and when the deductions can reach W-2 income
• The self-rental setup Amar sees with doctors and dentists who own their building
• How a 1031 exchange changes what you can depreciate going forward
• The service line he passed on early in his career, and the one he said yes to at KBKG

Also in this episode, at 25:26, Questions from the Underground: To Contingency or Not to Contingency. A Connecticut investor told Ed over coffee that he stopped carrying a rehab buffer because it always gets spent. Ed explains why he thinks that's wrong, why a lender reads a budget with no contingency as a red flag, and why a contractor eating your reserves through change orders is a contractor problem, not a buffer problem.

This episode is general education on how cost segregation works. It is not tax advice. Talk to your own CPA about your situation...or reach out to Amar directly.

Learn more about KBKG at kbkg.com, try the DIY tool at costsegregation.com, or find Amar on LinkedIn.

Amar's book recommendation: Process!: How Discipline and Consistency Will Set You and Your Business Free

Chapters:

• 00:00 Cold open: freeing up cash investors didn't know they had
• 01:11 Welcome, Amar Patel of KBKG
• 03:43 How a cost segregation study works
• 08:40 Recapture: what comes back when you sell
• 10:41 The most common depreciation mistake and the look-back study
• 13:26 If bonus depreciation changes again
• 16:58 Short-term rentals, passive losses and W-2 income
• 25:26 Questions from the Underground: To Contingency or Not to Contingency
• 28:43 Year-end planning before the fourth quarter
• 31:21 Lightning round and where to find Amar

Got a question you want answered on the show? Send it to [email protected].

Recorded October 2026.

Real Estate Underground with Ed Mathews. Find us wherever you get your podcasts, at clarkst.com/podcast or elevista.com/podcast

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Stephen Morel has spent more than 20 years as a Louisiana title attorney working in the messiest corner of title work: delinquent tax sale titles. He helped rewrite Louisiana's tax sale law, and after Hurricane Katrina he built a title insurance program that put abandoned, forgotten properties back into the stream of commerce. Now he runs JurisDeed. His opening point is the one most tax lien pitches skip. "This is not a private investment, this is a government investment... You have to play by their rule book."

Stephen also explains why the Supreme Court took the gotcha out of tax liens. After Tyler v. Hennepin County, the investor who forecloses no longer keeps the owner's equity. What's left is an interest return, and a process you have to prove you followed.

What Ed and Stephen get into:

Also in this episode, Questions from the Underground, from Marnee in South Carolina: two years into a multifamily syndication, the sponsor sent a capital call for another 20% of her original investment, due in 30 days. Ed covers the three things a sponsor owes you before you wire more money, why you treat the call like a brand new investment, what the operating agreement says happens if you pass, and three things to do before you invest a single dollar.

JurisDeed is in closed beta at jurisdeed.com. Stephen also hosts The Innovative Investor Podcast, or find him on LinkedIn.

Got a question you want answered on the show? Send it to [email protected].

Recorded September 2026.

Real Estate Underground with Ed Mathews. Find us wherever you get your podcasts, at clarkst.com/podcast or elevista.com/podcast

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Nasir Ali runs Rise360 Ventures. He comes from eight generations in commercial real estate and is the second generation in manufactured housing, a business his family just marked 45 years in, through at least nine downturns. His case for the asset class is simple. "We own the land. And sure the common areas and whatnot, but essentially we're renting dirt." No plumbing, no electrical, no toilets for every unit. "I don't own the damn door."

Nasir also thinks the hard part of the cycle hasn't hit yet. As credit tightens, he says, it sets the stage for more creativity, more creative financing and alternative financing. And when budgets get cut, "people drop what they don't need. You can't drop shelter."

What Ed and Nasir get into:

Also in this episode, Questions from the Underground, from Dave in San Clemente, California: an investor rehabbed and rented a house, and the refi appraisal came in short of what he needed to pull his cash back out. Ed covers why you need to be proactive with appraisers, not reactive, the packet he gives every appraiser, why any pushback is about the comp and not the number, and why he underwrites the refi at 90 to 95% of after rehab value before he buys.

Book mentioned:

Get Nasir's free manufactured housing report at rise360ventures.com, or find him on LinkedIn.

Got a question you want answered on the show? Send it to [email protected].

Recorded September 2026.

Real Estate Underground with Ed Mathews. Find us wherever you get your podcasts, at clarkst.com/podcast or elevista.com/podcast

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Forrest Jinks runs Altus Equity Group, a real estate investment company that works with family offices and high net worth investors. Most sponsors chase top-line IRR: get in, get out in two, three or four years. Forrest says that leaves a lot of meat on the bone. "It might be awesome to get an 18% return over 10 years versus a 20% return in three." He cares about the net return, after taxes, and about how much risk sits behind the number.

Altus runs a lending side too, and Forrest underwrites every loan like an owner. His first question: would we love to own this in our equity business at the debt amount plus foreclosure costs? "If the answer is yes, we're gonna figure out a way to make that loan work."

What Ed and Forrest get into:

Also in this episode, Questions from the Underground: Jose's lender approved half his draw, and his contractor says no money, no work. Ed covers why the fight is really about the definition of done, why your project schedule and your draw schedule need the exact same language, and why you carry a 10 to 20% contingency.

Book mentioned:

Read the Altus Insight, Forrest's monthly article on investing and economics, at altusequity.com/insights.

Got a question you want answered on the show? Send it to [email protected].

Recorded September 2026.

Real Estate Underground with Ed Mathews. Find us wherever you get your podcasts, at clarkst.com/podcast or elevista.com/podcast

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Palmy Kitti and her sister Nan started a fashion business with $2,000. Years later their biggest client shut down all its retail stores and 95% of their income was gone overnight. They moved into flipping houses in Los Angeles, then into multifamily syndication. Seven and a half years in, Palmy says they have nearly half a billion dollars in assets under management across Georgia, Arkansas and Texas.

Now a lot of that business runs through AI. After a property management changeover, her system flagged that one property had more cash than its reports showed. They'd overfunded the reserve account by $169,000. Finding that used to mean people matching rent rolls against the T12 and the general ledger by hand. She says it took her less than five minutes.

She's just as clear about where AI stops. "You can have the best AI tools, but AI doesn't give you that judgment. You have to make that judgment."

What Ed and Palmy get into:

Also in this episode, Questions from the Underground: when do I quit the job? Ed covers what has to be in place before you leave your W-2: insurance, cash reserves, debt, plus structure and protection.

Book mentioned:

Learn about Palmy's AI operating system at kittiroadmap.com, and find The Kitti Sisters at thekittisisters.com and on YouTube, TikTok, Instagram and Facebook.

Got a question you want answered on the show? Send it to [email protected].

Recorded September 2026.

Real Estate Underground with Ed Mathews. Find us wherever you get your podcasts, at clarkst.com/podcast or elevista.com/podcast

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Jason Williams spent 15 years as a chemical engineer. He's owned real estate since 2003 and large multifamily since 2017. When he started underwriting apartments, half the spreadsheets he was handed had broken cells and equations that didn't work, so he built his own model. People kept asking him to show them how it worked, and that model became Ironclad Underwriting.

His rule is simple: never underwrite off your own numbers. The property manager tells him what each unit can rent for. The insurance broker prices the premium off comparable properties, and he uses the high end of the range. A tax advisor fights the assessment. And the plumber's bid gets multiplied by three, sometimes four.

"Every single property I've had from a 1950s build up to early 2000s has had major plumbing issues."

What Ed and Jason get into:

• Why a T12 almost never ties to the bank statements, and when that gap is actually a red flag
• Rent rolls that look clean but hide a rollover cliff, and why the manager, not the spreadsheet, sets pro forma rents
• Insurance priced on replacement cost, and what Texas nondisclosure does to your tax bill after you buy
• The tax advisor who saved him $20,000 one year and $11,000 this year, paid only on a percentage of what he saves
• Why he no longer chases agency debt, even with the better rates
• A 72-unit plumbing job that put residents in a hotel for two weeks, and a gas leak that shut off the gas over Easter weekend
• Ed's sewer line on a 10-unit building that passed inspection: a $5,000 to $10,000 fix at purchase that became $44,000 a year and a half later
• Six months of reserves, and why Ed doubled his after the pandemic
• The zoning mistake on a mobile home community that has cost Jason more than a year of unexpected debt service

Also in this episode, Questions from the Underground. An experienced Connecticut investor asked Ed whether it's time to cycle back to cash flow deals or keep riding the appreciation wave. Ed's answer: it's always a cash flow play. Appreciation is the cherry on top, not the basis of a business plan.

Books mentioned:

• Who Not How by Dan Sullivan with Dr. Benjamin Hardy, Jason's favorite
• The E-Myth Revisited by Michael E. Gerber

Connect with Jason Williams at ironcladunderwriting.com, or on LinkedIn. His free underwriting resources and his weekly underwriting podcast are on the site.

Got a question you want answered on the show? Send it to [email protected].

Recorded September 2026.

Real Estate Underground with Ed Mathews. Find us wherever you get your podcasts, at clarkst.com/podcast or elevista.com/podcast

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Stewart Heath, CPA went into 2008 over-levered and under-reserved. He handed buildings back to the banks. He says that for want of roughly $300,000 in reserves he would still own them, and every rule he operates by now was built backward from that number. His book is called "Don't Do What I Did."

Stewart runs Harvard Grace Capital out of Spring Hill, Tennessee, buying stabilized commercial assets along the I-65 corridor from Nashville to Birmingham. Medical office, suburban office, storage, retail and warehouse. Eleven assets by the company's count and more than 300,000 square feet. Their tagline is boring is beautiful. It is printed on the banners.

"There's not a whole lot boring about 13% cash on cash returns."

What Ed and Stewart get into:

• The 12 months of mortgage reserves he sets aside on every deal, sized as if the property income goes to zero, and what holding that money costs him in returns
• Why medical office is his favorite asset class: hundreds of thousands of dollars of tenant build-out, 10 year leases, triple net with 3% bumps and tenants who treat rent as a line item instead of a negotiation
• Suburban office and service retail, the class B buildings where a business meets its customers rather than collects its employees
• Why he underwrites a geography and not an asset class
• Why he refused to run a fund for years, and what two independent RIA relationships changed
• Retail moving from 25% food and restaurants to almost 60%, with price per square foot almost doubling in three years
• Why he stopped doing single-tenant deals after watching a tenant walk out on 10 years of lease
• The contrarian office call: nobody can finance new office, the population is not shrinking and one of his buildings sits in a town under a two year sewer moratorium

Also in this episode, a new segment called Questions from the Underground. An investor owns 19 units two states away. His manager reports 95% occupancy every month and his distributions have shrunk four quarters in a row. Ed walks through the per unit profit and loss that tells him whether he has a building problem, a manager problem or one bad quarter.

Books mentioned:

• "Don't Do What I Did" by Stewart Heath. Free at harvardgrace.com for an email address.
• Who Not How by Dan Sullivan with Dr. Benjamin Hardy. Stewart is on his third read.
• The E-Myth Revisited by Michael E. Gerber
• Buy Back Your Time by Dan Martell
• Rich Dad Poor Dad by Robert Kiyosaki, the book his mentor handed him

Connect with Stewart Heath at harvardgrace.com, or on LinkedIn. The free book and his calendar are both on the site, and he will talk real estate with anyone.

Got a question you want answered on the show? Send it to [email protected].

Recorded June 2026.

Real Estate Underground with Ed Mathews. Find us wherever you get your podcasts, at clarkst.com/podcast or elevista.com/podcast

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Twenty-five years ago Jeff Emalaba was a guest host on CNBC Africa, analyzing derivatives, commodities and futures, and holding an options license in Florida. He describes all of it as one subject: risk transference. That is the lens he brought to real estate, which makes what happened next harder to explain and more useful to hear.

He drove two hours to see a duplex in North Carolina and walked it with his agent. Nothing looked wrong. He asked the seller why the previous buyer had backed out and was told they could not get funding. He asked his agent to dig further. Nothing came back.

So he paid. Five thousand dollars in non-refundable due diligence fees, five thousand in earnest money, six hundred seventy-five for an inspection, seven hundred for an appraisal. That money was committed before anyone had been inside the walls.

Then the inspector came back with one word: run. Foundation, structural, roofing, mold, electrical.

Jeff didn't believe him. He decided the inspector was exaggerating and hired a general contractor to go prove it, fully intending to pay that contractor to fix whatever turned out to be wrong. The contractor sent back a ten-page email explaining why he should never buy the property unless he had a hundred thousand dollars to spend. Jeff walked. The seller kept the money.

The part Jeff wants investors to understand is how all of that was legal. A seller who already knows about a prior buyer's inspection report can select no representation on the disclosure form, stay silent, and keep the fees when the deal dies. He calls it the no representation loophole, and it is what sent him to build InvestFusion.

Ed presses him on the part that matters to anyone evaluating a tool like this: where does the data actually come from, and what happens in the middle when you ingest three inconsistent sources and output one confident answer. Ed asks as an operator who runs his own deals through AI, not as a host taking a pitch.

Also in this episode: why Ed thinks a Zestimate is not merely inaccurate but dangerous, what a single government tenant can do to a commercial deal, the four fees an investor can lose before owning anything, Manny Khoshbin's "you make your money on the buy," and Ed's own translation of the word pro forma.

Questions from the Underground is back at 26:38. Jack, an investor in North Carolina, analyzed sixty deals in three months and made zero offers because nothing penciled. He wants to know whether the market is broken or he is. Ed's answer: sixty analyzed and zero offered is not caution, and there is a three-step sort that tells you which of your buy box, your cost of capital, or your read on the market is actually wrong.

Connect with Jeff Emalaba

• InvestFusion: investfusion.co
• LinkedIn: linkedin.com/in/jeff-emalaba
• Jeff made a page just for this show, with his deal-killing red flag cheat sheet and his 60-second vetting blueprint: underground.investfusion.co

On the nightstand

Jeff's go-to, read many times over: Goals! by Brian Tracy

Real Estate Underground with Ed Mathews. Find us wherever you get your podcasts, at clarkst.com/podcast or elevista.com/podcast

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Mark Khuri co-founded SMK Capital Management with his father, Dr. Suheil Khuri, pooling family capital informally before opening the firm's doors in 2010. They operated properties directly through 2017, then pivoted entirely to the LP side. Today SMK reviews 600 to 700 private real estate deals a year and invests in roughly 1 to 2% of them, call it 5 to 10 deals annually, across diversified funds, single-asset deals, and one-off syndications for their investor base.

Ed and Mark get into the mechanics of how SMK actually filters that flow: a 40-point due diligence checklist covering firm credentials, deal-level underwriting, and required deliverables, the discipline of comparing an operator's underwritten returns against their actual results on deals that already went full cycle, and the red flags that end a conversation before it starts (a principal who won't share their last name is an automatic no).

From there, the conversation turns to mobile home parks, an asset class SMK has been investing in since 2012. Mark explains why new supply is structurally constrained (NIMBYism, unaffordable construction economics), why 70 to 80% of parks are still owned by mom-and-pop operators with no succession plan, and the specific value-add levers SMK targets: occupancy infill and converting park-owned homes into tenant-owned homes through rent-to-own financing structures. He's candid about where the asset class has gotten more competitive, cap rates in some markets have compressed from north of 10% a decade ago to 3 to 4% today, and why SMK stays out of the priciest infill deals and the most distressed ones alike.

The episode closes on underwriting discipline: the hardest deal Mark walked away from recently, and why "pro forma" so often needs a second, much more skeptical read.

Also in this episode: the first installment of Questions from the Underground, where Ed answers a real problem an investor put to him: a contractor took most of the draws, the job is 40% done, and the contractor has gone dark. What to do first, on tape, no filler.

Real Estate Underground publishes every Tuesday.

Chapters
0:00:00 Cold open: "We like to see underwritten returns versus reality"
0:00:40 Real Estate Underground intro
0:02:03 Welcome Mark Khuri, SMK Capital Management
0:03:32 From property operator to fund-of-funds: the 2017 pivot
0:05:06 Going for the no: SMK's first filter on any deal
0:07:23 The 40-point sponsor due diligence checklist
0:09:02 Red flags: the people behind the deal
0:11:21 The exit-strategy question that reveals alignment
0:12:33 Why mobile home parks: the supply story
0:14:44 Ownership is still mom-and-pop: the value-add opportunity
0:16:28 Converting park-owned homes to tenant-owned
0:19:30 Still a darling, or getting crowded? Cap rate compression
0:21:28 Where SMK's deals actually come from
0:21:50 Questions from the Underground: the contractor who took the draws and vanished
0:26:49 The hardest deal Mark walked away from
0:27:57 "Pro forma is Latin for full of shite"
0:29:58 Cashflow gets you through the downturns
0:30:51 Final five: purpose, mentors, and the "show them 15" lesson
0:36:32 Who Mark reads: Jay Parsons, Marcus & Millichap, Richard Duncan
0:37:13 Defining success, life in Bend, Oregon, and how to find SMK

Connect with Mark Khuri:
smkcap.com
linkedin.com/in/mark-khuri-7543821

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!

Most people hear hotel conversion and picture a novelty deal. Dr. Alex Cartwright built a company around it, and the reason is arbitrage that is not subtle.

His firm buys hotels that have no future as hotels. Sometimes they are old and not worth remodeling. Sometimes they are newer but stuck in a crowded market as the least desirable option. Sometimes they just carry too much debt. Whatever the story, the test is the same: is the highest and best use of this building multifamily? When the answer is yes, the multifamily price is dramatically higher than the hotel price, and the conversion unlocks the difference.

The Denver project makes it concrete. A 310-room Holiday Inn sat next to Stapleton Airport until Denver built a new airport further out and the demand driver moved. Eleven stories, an atrium lobby, a balcony on every room, three underground racquetball courts. Nobody is building that again in a neighborhood of three and four story garden style apartments. Alex bought it a little under $30,000 a door and is spending $40,000 to $45,000 a unit to convert it, against comparable apartments in the mid to upper $200s.

In this episode:

Plus the Final Five, a poem called The Man in the Glass, and why you should always be looking for your next mentor.

About Dr. Alex Cartwright

Connect with Alex: hotelshift.capital. He writes the mailing list himself.

This week's book: How Elon Musk Thinks. He also recommended the economics blog Marginal Revolution and the All-In podcast.

Chapters

00:00 The rent-burdened middle: $45k to $75k a year

Real Estate Underground

Flipper Camp is a live online program for house flippers, taught by Ed Mathews, who has been flipping houses since 2011. Learn how to find deals that pencil, estimate a rehab without guessing, fund and sell on budget, and use AI and technology to run more than one flip at a time. The next session is capped at 25 seats. 

Join the waitlist for first access: https://flippercamp.com

Elevista - Speed as a Service™
Elevista Connect is the first AI-powered lead conversion system built for real estate investors.

🎧 Subscribe to Real Estate Underground for weekly insights on building wealth through real estate, without sacrificing your sanity.

Additional Resources:

• Clark St Capital -> Passive real estate investments for busy business owners and executives
• Elevista -> AI SaaS for real estate investors
• Clark St Academy on YouTube -> Learn how to invest in real estate

Social Media:

• LinkedIn -> Ed Mathews (President at Clark St and Elevista)

Heads up: If you find this week's book intriguing and you buy using our link, we receive a small commission that helps support the show. Thank you!