Ritter on Real Estate

The SEC recently adopted amendments to the “accredited investor” definition, one of the principal tests for determining who is eligible to participate in private capital markets, and today’s guest, Kim Lisa Taylor, is just the person to explain them. Kim is a nationally recognized corporate securities attorney, speaker, and author of the number one Amazon bestselling book, How to Legally Raise Private Money. She’s is also the founder of Syndication Attorneys, PLLC, and investormarketingmaterials.com. Its purpose is to provide quality legal advice, offering documents and professionally designed marketing materials for clients nationwide. Kim has been a responsible attorney for hundreds of security offerings and she routinely teaches subjects related to legally raising private money in front of groups, ranging between 50-1000 plus attendees. In this episode, Kim explains the SEC’s new accredited investor guidelines, who is eligible, and what the requirements are, so make sure to tune in today!

Key Points From This Episode:

• Kim explains the definitions of an accredited investor and how the definitions for retail investors specifically have changed.
• Very few people that have certain securities licenses have been excluded, says Kim.
• Other categories that pertain to retail investors – knowledgable employee of a private fund, and spousal equivalent.
• Spousal equivalent is an attempt to make it more inclusive for previously excluded groups.
• While you needn’t be married to be eligible, you still have to meet the net worth requirement.
• Kim explains how definitions have changed for non-retail and quasi-institutional investors.
• The third category is charitable organizations, where their assets exceed $5 million.
• New additions include SEC or state registered investment advisors, rural business investment companies, and foreign-organized entities.
• An additional qualifier is family offices with at least $5 million in assets under management.
• These rules are not in effect yet – they need to be published in the federal register and cure.
• Kim explains the necessary requirements for Regulation D Rule 506(c) and 506(b) offerings. 
• There is a lot of value in employing an attorney to help you read between the lines.
• Kim thinks an accredited investors test or more formalized program would be a great idea.
• The way Kim suggests that investors get accredited is they attend the same training classes the syndicators they are investing with do.
• You must understand the distribution waterfall, otherwise Kim would be cautious of the deal.

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

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Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

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Everyone has their own idea of what financial freedom looks like. To Lloyd Edge, an investor boasting a multi-million dollar property portfolio, financial freedom means having the security to live your desired lifestyle, live in your dream house, and follow your passions. In today’s episode, we speak with Lloyd about how he secured his financial freedom through real estate investing. We begin our conversation by tracking his journey from being a teacher to becoming an investor. Lloyd talks about his motivations and his need to build something bigger than his job. He opens up about mistakes he made early in his investment career, the mindset shift he underwent, and how setting goals and developing the right strategies kick-started his success. We dive into the power of positivity and education when starting out as well as surrounding yourself with smarter, more experienced investors. Lloyd discusses why creating different sources of income can unlock more choices in your life before sharing what he looks for in investments. A sound investment strategy, Lloyd provides details on the ‘property trifecta,’ his way of manufacturing equity, and ensuring that his investments aren’t shackled to market forces. Lloyd’s story shows that anyone can find success through focus and by following their passion. Tune in to hear more about securing your financial freedom.

Key Points From This Episode:

• Lloyd shares his journey from being a teacher to becoming a passive investor.
• How a lack of financial security motivated Lloyd to dive into real estate.
• What financial freedom means to Lloyd; living a more fulfilling life. 
• The importance of passion and being able to recognize when your life needs changing. 
• How Lloyd developed the mindset to be able to shift towards real estate. 
• Why setting goals can be game-changing for your career. 
• Finding motivation by feeding off of positive and like-minded people. 
• The perceived security of nine to five jobs and not limiting your growth potential.
• Why developing your passive income stream is vital to having choices in life.
• Hear about the ‘property trifecta’ — capital growth, instant equity, and cash flow. 
• Lessons learned and what Lloyd’s business model and portfolio currently looks like. 
• Seeing investments as vehicles to reach your goals. 
• Why passion is Lloyd’s number one key to success.

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

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Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

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In the past, real estate investors didn’t need to worry about getting sued. Now, it’s becoming part of the cost of doing business. Asset protection has become the front-line defense against predators who abuse the legal system. In today’s episode, we dive into the subject with Brian T. Bradley, a leading and asset protection attorney for real estate investors, and high net worth families. Brain explains how the likelihood that you get sued increases the more your business grows. Having talked about the need for investors to protect their assets, we explore the different forms of asset protection that can range from deliberately carrying debt to establishing an LLC in a different state. After touching on how asset protection can get you to the negotiating table faster and in a stronger position, Brian unpacks the practical steps that investors should take to protect their assets. We discuss the pros and cons of onshore versus offshore asset protection and how Bridge Trusts offer the best of both worlds. Brian then talks about why hitting a net worth of $500,000 substantially increases your risk — it’s just enough to get sued but not enough to easily recover from it. We dispel common misconceptions around asset protection and Brian provides step-by-step information on the topic, including what happens to your money when you place it into a trust, and the average costs of asset protection. Tune in to hear more about asset protection. As Brian can attest, there’s no point earning money if you’re not able to keep it. 

Key Points From This Episode:

• Exploring Brian’s acclaimed career as an educator and asset protection attorney.
• What ‘asset protection’ means from a real estate perspective. 
• Why lawsuits are an increasingly large issue; never have anything in your name. 
• Brian unpacks the roadmap for the different forms of asset protection. 
• How judges have broad powers to reach your assets, even when lacking legal authority. 
• The asset protection steps you should take when you’re an entry-level investor.
• What an asset protection trust is and how it’s different from other trusts.
• The pros and cons of offshore versus onshore asset protection strategies. 
• How US courts don’t always acknowledge the precedent of the state your trust is set up in. 
• The best of both worlds: setting up Bridge Trusts; a hybrid onshore, offshore model. 
• Why hitting a net worth of $500,000 substantially increases your risk. 
• Common misconceptions that people have regarding LLCs and asset protection.
• What happens to your money when you transfer it into a trust. 
• The four layers of asset protection: LLCs, asset management companies, asset protection trusts, and insurance. 
• Limits to insurance companies and how they might “wiggle out” of claims.
• Dispelling more myths around asset protection. 
• Why you should always seek professional help when it comes to liability.

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

Visit kentritter.com for more free passive real estate investing resources including videos, blogs, and tools visit

Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

Thank you for listening!

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In this episode of Ritter on Real Estate, we welcome professional asset manager Mike Taravella who joins us to share his unique perspective on deals. Mike worked for five years as a CPA and began his real estate investing career in 2016 when he bought and self-managed investment properties in Michigan. With an increasing interest in real estate development, Mike joined Rand Partners in 2019 where he is now an asset manager responsible for underwriting deals, investor relations, and asset management. 

Tuning in, listeners will learn more about the day-to-day functions of an asset manager, the key elements that should be included in a business plan, and how Rand Partners go about executing these plans to ensure good returns for their investors. For Mike and his team, communication and transparency are key, and these values are evident in the weekly meetings between property and asset managers and their frequent communications with investors. Mike also talks about their strategies for driving a property’s value, the importance of paying attention to other income, the use of the ratio utility billing system (RUBS) and surety bonds, and what investors should know about investing in the post-COVID market.  

Key Points From This Episode:

• Get a sense of Mike’s career path thus far and what an asset manager’s role is.  
• Hear about the elements in a business plan that should work together to increase income. 
• What Mike does to ensure that business plans are executed and investors get their returns. 
• Hear about their weekly meetings to track the numbers and keep a firm grip on properties. 
• The relevance of the communication between the asset and property manager to investors. 
• Mike describes the core metrics their team looks at to move the business plan forward. 
• The processes involved in compiling a business plan when a new acquisition is made. 
• How they drive value through rent and occupancy increases and effective marketing. 
• What “other income” comprises and the portion of the total income it should make up.  
• Mike explains the use of RUBS (ratio utility billing system) and surety bonds.  
• Views on what investors can expect from a returns standpoint in the wake of COVID-19. 
• Learn how Mike and his team prioritize and approach communication with investors.
• The value of investing in coaching and good books to gain knowledge quickly.  

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

Visit kentritter.com for more free passive real estate investing resources including videos, blogs, and tools visit

Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

Thank you for listening!

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In part two of our discussion on 1031 exchanges, we pick up where we left off with Michael Brady and Alex Shandrovsky. As more and more syndicators are advertising them, it’s crucial to get educated and understand the intricate rules. One of the strict constraints is the two different timelines, namely the 45-day replacement property identification period and the 180-day closing period. We learn more about these parameters, along with the consequences if they are not adhered to. Michael also sheds some light on the COVID-related changes in the space. From there, we move onto the Delaware Statutory Trust, which can be used in conjunction with a 1031 or instead of one to defer capital gains. We get an overview of how this structure works and when it makes sense to utilize it. Finally, we round the show off with our keys to success, where Michael shares why he’s most proud of his kids, and Alex shares the role Michael has played in his success. Kent even talks about how meditation has helped him stay more present and focused in daily life. This was a great conversation, and Michael and Alex do a great job of unpacking this complex but effective wealth-building tool. Don't miss out on today’s show!

Key Points From This Episode:

• Learn more about the two strict time constraints that come with 1031s.
• Why it’s recommended to only identify three replacement properties.
• The constraints that come with identifying more than three replacement properties.
• Some 1031 timeline changes that have happened in light of COVID-19.
• Why it’s preferable to have a contract and even do due diligence in the 45-day period.
• How the identification period works if you’re looking at syndication.
• A look at a Delaware Statutory Trust, an alternative to defer capital gains tax.
• The main takeaways from all this dense 1031 information.
• The final keys to success with Michael and Alex: One sponsor question, what they’re most proud of, and more!

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

Visit kentritter.com for more free passive real estate investing resources including videos, blogs, and tools visit

Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

Thank you for listening!

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If you are in the syndication space, you will have likely heard of 1031 exchanges, and while they may leave you scratching your head, they are an incredibly useful wealth-building tool. Today's guests, Michael Brady, and Alex Shandrovsky join us for a deep dive into these exchanges and demystify some of the misconceptions around this powerful tool. Michael and Alex both work at Madison 1031, a leading qualified intermediary that helps clients through the exchange process. We kick off the show with a definition of 1031s. In their simplest form, they are viewed as swapping one property for another to defer capital gains tax. After this, we get into the importance of the intermediary. While it could be tempting to go at a 1031 alone, using an intermediary is built into the swap structure, and Michael gives us some tips on what to look for to find one of a high caliber. From there, we take a look at when a 1031 does not make sense. Some of these instances include no capital gains, a bad deal or for a flip. Following this, we explore when a 1031 is advantageous. We wrap part up one with a discussion of how passive investors might use a 1031 out of a deal, and some of the complications this could bring.

Key Points From This Episode:

• An introduction to Mike and Alex, including their respective professional backgrounds.
• The definition of a 1031 exchange and how it encourages real estate reinvesting.
• How 1031 exchanges allow for capital gains tax deference.
• The role that an intermediary plays in a 1031 and why they are fundamental to it.
• Some of the technicalities the intermediary takes care of in a 1031.
• Why the ‘qualified intermediary’ does not have to be specially trained and tips on finding the best one.
• Hear some examples of when it does not make sense to do a 1031.
• Instances when doing a 1031 is most advantageous for investors.
• How 1031s work for passive investors on a syndicated deal and some of the planning they need to do.
• Why drop and swaps can be problematic for the IRS and individual states.
• Learn more about the Tenant in Common structure and the complications it can create.
• Why 1031s are a popular way for syndicators to bring investors onto the next deal.

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

Visit kentritter.com for more free passive real estate investing resources including videos, blogs, and tools visit

Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

Thank you for listening!

Check us out on socials: 

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Finding your investment niche and developing the right mindset are critical and foundational steps in establishing a thriving business. Today’s guests are Adam Ulery and Kevin Galang, the voices behind the Tech Guys Who Invest podcast, who provide insights into their investment niches. We open the conversation by exploring why Adam and Kevin got into investing, even though both of their backgrounds told them that you make money by working for someone else. Kevin and Adam discuss how investing leads to financial security, especially if you establish multiple streams of passive income. They then explain how different mindsets influence how you invest, and why you should be guided by math and not emotion. We focus on the importance of aligning an abundance, investor, and growth mindset to go further and faster in your career, along with helping you to grow as a person. Diving into their specialties, they talk about their different approaches and the benefits of either commercial multifamily investment, in Adam’s case, or in note investing, Kevin’s forte. While sharing what they look for in investments, Adam and Kevin emphasize the value of networking, developing a trustworthy team of people with different skill sets, and playing to your strengths. Near the end of the episode, they share their top books and the keys to their success. Tune in to learn how you can develop the kind of mindset that leads to success. 

Key Points From This Episode:

• Introducing Adam and Kevin — the minds behind the Tech Guys Who Invest.
• Adam and Kevin’s journey into real estate and which investment niches they specialize in.
• How real estate investing and having passive income has given Adam a sense of security. 
• Why having unexpected costs means that you can’t “save your way to financial success.”
• The importance of having an investor mindset and being guided by math, not emotions.
• Why also having an abundance and growth-focused mindset will lead to greater success. 
• Hear about each of the guests’ approaches to investing. 
• Kevin’s perspective on why note investing allows for so many exit strategies.
• How networking was key in Adam closing his first deal and building an investment team. 
• Why closing a deal doesn’t always work out as one might expect.
• Specifics about Kevin’s early note investments and how creative you can get with them.  
• The level of control that note investing can give you over a deal.
• What Kevin learned from playing the stock market and why it’s not for him.
• Why education and understanding each deal is important for passive investors. 
• Learn the components that Adam looks for in a multifamily investment.
• Understanding the worst-case scenario before closing a deal.
• Why you should seek counsel from local real estate attorneys and brokers.

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

Visit kentritter.com for more free passive real estate investing resources including videos, blogs, and tools visit

Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

Thank you for listening!

Check us out on socials: 

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In today’s episode, we’re going to be addressing value investing, working with a team that you trust and you’re comfortable with, and the importance of coaching. It’s the first time we’ve had two guests on the show, so we’re excited to welcome Collin Shwartz and Chris Pomerleau. Together, they run Park Ave Capital, which focuses on acquiring properties in the Omaha area. They collectively own 600 units, and in addition to that, they both serve as coaches for newer investors. Collin additionally runs his own property management firm called Brick Town Management and is head of the largest Meetup in Nebraska with about 1000 members. In this episode, we discuss why they chose Omaha, investing within the path of progress, and making sure that you’re comfortable with the operator when evaluating a deal. We also talk about the importance of understanding risk, doing due diligence, and the revenue and cash flow increases you can create by utility bill backs and charging common area maintenance fees. Chris and Collin talk about coaching, giving back, and what they’re most proud of, as well as their number one goals for 2020, and the books we should all be reading.

Key Points From This Episode:

• Why Collin decided to invest in Omaha, after seeing no dip during the last recession.
• Chris explains how he grew up just outside of Omaha, which made it easy to invest there.
• High appreciation and high volatility at the coast versus forced appreciation in the Midwest.
• Collin talks about looking in the path of progress – investing in areas that may be considered fringe now, but where there will be development opportunities in a few years.
• Chris shares why he thinks the most important part is feeling comfortable with the operator when evaluating a deal or vetting a syndicator.
• Collin highlights the importance of aligning with your partners and understanding the risks.
• Why Chris and Collin do their due diligence and look for partners with experience in every aspect of a project – from contracts and insurance to managing and roofing.
• What to look at when assessing a deal, including rental and expenses.
• Utility bill backs and common area maintenance –  how they can help you increase revenue.
• Collin and Chris talk about their experience of coaching and becoming coaches themselves.
• Some of the barriers Collin has encountered in coaching others, such as networking.
• What’s next for Chris and Collin and how they like to give back to the community.
• Collin and Chris share what they’re most proud of, especially their relationships with tenants and team members and their ability to spend more time with family.
• Number one goals this year include quadrupling their investor base and being present.
• The books that everyone should be reading: The Miracle Morning and The Compound Effect.
• The one question Chris would ask a deal sponsor – how did you handle a negative effect, and how did you make it right by your investors?

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

Visit kentritter.com for more free passive real estate investing resources including videos, blogs, and tools visit

Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

Thank you for listening!

Check us out on socials: 

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https://hudsoninvesting.com/

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Our guest on the show today, Dave Childers, has a refreshing perspective on investing in small multifamily rather than going after the larger syndication deals, highlighting specifically the cash-flow benefits of smaller properties. With more than 15 years of experience in real estate investing and multifamily housing, Dave has worn all the hats, from property and asset manager to broker, coach, and speaker. Dave is the managing member of Cedar Rock Capital and, after identifying the need for a brokerage firm that focused on small multifamily properties, he established Residential Investment Advisors through which he has brokered over 400+ small multifamily properties in Middle Tennessee, Northern Alabama, and Southern Kentucky. In this episode, Dave starts at the grassroots of passive investing, advising listeners on evaluating deals and vetting sponsors to ensure that their investment goals line up with the other parties’. He discusses the three paths of investing, outlining the advantages and disadvantages of each and explaining why it all depends on what the investor hopes to get out of the deal. Of course, that is not to say that investors should stick to one route. On the contrary, Dave talks about the benefits of investing in various asset classes and locations and having different goals, thereby ensuring that your portfolio is well-diversified. It’s all about knowing what kind of investor you are and being upfront about your expectations. Be sure to tune in to learn a great deal more from Dave Childers! 

Key Points From This Episode:

• An introduction to our guest, his brokerage firm, and his involvement in Cedar Rock Capital. 
• Advice for getting started and evaluating deals as a passive investor in multifamily real estate.
• How investors should go about vetting sponsors and how sponsors can build up credibility. 
• The deals that produce the best returns and why it all depends on the investor’s goals.  
• The pros and cons of each of the three paths of investing from the perspective of the investor. 
• How the risk profile changes for the investor depending on the size of the deal.
• Hear how Dave thinks about educating passive investors who want to learn the business. 
• Get a sense of what Dave focuses on when starting to educate investors. 
• Dave talks about the cash-flow benefits with smaller properties versus the larger deals. 
• The importance of finding like-minded sponsors who aim for the same type of returns as you.
• Understanding that you do not need to follow the same path with every investment you make.   

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

Visit kentritter.com for more free passive real estate investing resources including videos, blogs, and tools visit

Interested in Investing alongside my firm?

 Contact me at [email protected].

My company Birge and Held Asset Management have a twelve-year track record creating sustainable wealth for over 2,000 investors through high-quality multifamily investments.

https://birgeandheld.com

Thank you for listening!

Check us out on socials: 

Instagram

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https://hudsoninvesting.com/

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If you are a real estate investor, this is a must listen to protect yourself!

Fraud is a risk that we usually don’t consider as we evaluate deals, but it definitely should be. Kim Lisa Taylor is here today to talk to us about how fraud happens in deals and how as investors we can ask the right questions to avoid getting involved with a bad sponsor.

Kim Lisa Taylor is a nationally recognized corporate securities attorney, speaker and author of the No. 1 Amazon best-selling book “How to Legally Raise Private Money".

She is the founder of Syndication Attorneys, PLLC and InvestorMarketingMaterials.com, whose purpose is to provide quality legal advice, offering documents, and professionally designed marketing materials for clients nationwide. Kim has been the responsible attorney for hundreds of securities offerings. She routinely teaches subjects related to legally raising private money in front of groups ranging from 50 to 1,000+ attendees. 

Kim Lisa Taylor discusses

1. The reason people commit fraud
2. The three types of fraud:
   1. Illegally raising money (not following securities laws)
   2. Embezzlement - Partner Fraud
   3. Ponzi Schemes
3. Practical tips on what to look out for before and during your investment
4. What questions you should be asking your sponsors to validate their behavior
5. What to do if you find yourself in a position where you think fraud is happening in your deal

Get in Touch with Kim
syndicationattorneys.com
[email protected]

Link to Kim's Book
https://howtolegallyraiseprivatemoney.com/

If you enjoy the guests and content please subscribe and leave a review.  Your reviews matter and each one has a major impact on the success of the show!

Want to get more investing resources?

Visit kentritter.com for more free passive real estate investing resources including videos, blogs, and tools visit

Interested in Investing Alongside me in our next multifamily deal?

Contact me at [email protected].

My operating partner, Birge and Held Asset Management has a twelve year track record creating sustainable wealth for over 2000 investors through high-quality multifamily investments.

https://birgeandheld.com

Thanks for listening!

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Production by Outlier Audio