The SFR Show

In this episode of Weekend Wisdom, Michael Zuber shares his strategy for employing private capital. Catch Michael Zuber on YouTube at One Rental At a Time.   

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Transcription

Tom:

Happy weekend, everybody. This is another episode of Weekend Wisdom on The Remote Real Estate Investor. On today's episode, we have author and thought leader Michael Zuber, he is the author of One Rental At A Time, he also has a podcast and a YouTube channel. Definitely worth checking them out. And today we talked to Michael about his methodology of raising private capital. I love it. I think it splits the risk and the upside, he does this thing called a 6-20. And I'm gonna let him explain. Michael, let’s hear it.

Michael:

Yeah, so one of the things that if you're a real estate investor that is often thought of is the holy grail is raising private money. Now, I believe raising private money needs to be done correctly, I think you need to give it the respect it needs. There are lots of checks and balances. And you must understand the process, the rules of the road, all of that. But the beauty of it is once you understand private money, and you have a track record, you can orchestrate a private money package that works for your lender, which is a friend or family member, and yourself. And I've done two things in my career. And where I raised millions of dollars back in 2010. Just to set this up, people were frightened, and I was paying 10% interest for the entire purchase price of property because lending or savings rate was less than 1%. Much like it is today. People were so scared, but I had documented my success back then. It wasn't YouTube. It was actually a blog, which I wish I kept, but I let it go.

But that blog allowed me to attract millions of dollars because I was documenting what we were doing buying. It was BRRRR before it was BRRRR, right? I'm sure Brandon Turner saw something I was doing because I was posting on bigger pockets all the time. And it became BRRRR right, buy a dump, fix it up, rented refi with, in my case, private money and do it again, which now he calls Burr. But now what I've done in the last couple of years is the market has changed. Real estate is sexy again, in 2010. Nobody wanted to touch it. But real estate sexy today. So what I found today is people aren't really interested in 10% interest, of course, they will take it. But they what they want is they want a piece of the action, right? They want part of the profit.

So what I've done is I've devised a six and 20 program where I again, borrow 100% of the purchase price. And now instead of paying 10% interest, I'm paying six annualized, right, so it's 100 grand is 500 bucks a month. But what I do is I give him 20% of the profit. So when I'm out of a property in 120, or 160 or 200 days, they not only get monthly checks, because I pay monthly like a mortgage payment, which is the 6% part. But they will get 20% of the audited return, which when you annualize everything I've done have the millions of dollars I borrowed, everybody's got an annualized return to date, an excess of 20%. And again, it's all secured, right, your first trustee, your name down insurance just in case it burns down, I invest all the capital repairing it. So my dollars are at risk first. It's extremely safe thing.

But the key to this program is I listen to the private money investors first. I didn't just create it, I went back to the people who lent me millions of dollars before and said, What do you want? And they're like, hey, that 10% was cool, but you cashed me out? Right? That was cool. I lasted but once you could get a loan you did because 6% is lower than 10. And I wish I was still getting 10 Well, like sorry, Yo, 10s Hi. I don't want to take 10 forever 10 times, but like, Well, we'd love to piece of the action. So I'm like, Okay, well, how do you feel about 20% because I'm doing all the work, I'm finding the deal. And they're like, cool. So I'm like, Great, well, let me give you 6% now because that's what I can get from banks. And I'll give you 20% of the upside, they're like Sign me up, let's let's do it. So the six and 20 was born and again borrow millions of dollars doing it.

Tom:

I love that model just in that you know the same value that you have with real estate because you're having the the ongoing cash flow, which is that 6% plus all the upside of the appreciation and all of that it's, it's beautiful, it's beneficial for you because you're coming in at 6% right away or anyone else that you know, using this similar type of a model. It's incredible, brilliant.

Michael:

I mean, I love to talk about it because of what the investor gets but I'm a nice guy, but I'm not not going to give the farm away. Right my investors annualized return is 20% My annualized return is over 80% right because all I bring in is a repair money in my monies in shorter and when we exit you know my return on repair money is often much bigger than the purchase because if I purchased it for 120 I might put in 30 or 35 so if i net 20 on the out and they get you know whatever that would be six plus the cash flow I mean yes they get great returns but let's be clear I'm winning also.

Tom:

Yeah,

Emil:

When you say exit is that usually cash out refi or was it sale? Oh, today's market would be a sale owner occupants are buying things hands over fist. So if they want to overpay I will let them

Tom:

Get out of the way. Yeah,

Michael:

Get out of the way. There you go.

Tom:

If you enjoy the episode, enjoyed the podcast, please subscribe and give us a rating and have a great rest today. Happy investing

In this episode we dig into the Denver market with Tony Cline from Home Vault. homevault.com

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Transcription

Tom:

Greetings, and welcome to The Remote Real Estate Investor. My name is Tom Schneider. And today we have a special guest, Tony Cline, who is the chief expansion officer at home vault. And today we're going to be doing a market deep dive on the Denver market. And I'm joined with my co host,

Michael:

Michael Albaum.

Tom:

All right, Michael, let's get into it.

Theme song

Tom:

Tony, let's learn a little bit about yourself.

Tony

Yeah, so we came together, there's a few of us companies that came together. And we've been working on this for a while, that we've realized that the market is really changing. technology's changing, legislation is changing. And we started as a mastermind, trying to figure out, you know, how could we stay out in front of all of these changes as real estate investors or as a property management company and continue to provide good quality service to our clients and to our tenants? And it just turned into rather than just being a brain brainstorm, let's go ahead and let's actually create a company. So we've been working on that for about a year and a half. And we've rolled that out.

And it's really exciting to be able to see the things that we're doing to stay out in front of all of these changes, like the legislation and technology and market shifts and differences in what tenants are looking for now compared to what they were looking for in a property five years ago. That's a little bit of my professional background. My personal background is I'm an ultra marathoner and like to spend a lot of time up in the woods, running from something I guess.

Tom:

Denver is a great place that are a very, I guess, hardcore would be a place to be an ultra marathoner.

Tony:

Yeah, there's a lot of greats out here for sure.

Tom:

Gosh what was a that book, Born to Run. It was like talking about his Yeah,

Tony

Yeah. Scott Jurek is he's located out here. Now. He was from I think, Minnesota when he was in that book. But he's out here now and but up in Boulder.

Tom:

Awesome. And what did you do before before Home Vault?

Tony:

So before Humboldt, my company that I merged into the merger was started in 1978. And it was a company that was started in downtown Denver. And the gentleman who started it actually wanted to open a REMAX franchise in downtown Denver. And in 1978, the REMAX company said, we're not willing to open an office there, because there's not enough residential business to support an office. You know, obviously, Flash forward 40 years and, you know, the downtown Denver is booming. And there's a ton of people there, but I bought that business in 2000. And prior to that, I was in the technology business. So I had a company that focused on document and data management. And, and then in 2000, I switched over to being a full time real estate agent, property investor and property manager.

Tom:

Awesome. Fantastic. Let's go ahead and jump into it. So what I'd like to do at the start of these discussion is, so we have the anchor city of Denver, how would you describe some of the other sub markets within Denver? And you know, maybe a way to do this is to kind of think about is Denver as maybe a clock or ways to kind of like have think about sub markets within Denver?

Tony:

Yeah, sure. So Denver, there's actually the city and county of Denver, which is our state capitol, and from their you know, they're really like most big cities, there's no true dividing lines. When you're visually you know, legally obviously there is but when you're looking at it, just one big metropolitan area so if you were to look at that, you know, Denver kind of goes up north into like Thornton in North Glen Broomfield. If it goes off to the east, you've got Aurora, Greenwood Valley, and then South you've got down into Parker, Colorado Springs in Colorado Springs used to be its own metropolitan area. And now in between there Castle Rock is filling in there's just, well, Colorado Springs is still kind of its own unique identity. What used to be open space is now filling in. And then if you go west from Denver, you've got cities like Arvada and Golden, Lakewood, wheat Ridge, there's a lot of different sub markets with different property types.

Tom:

As a property management company, where do you guys see the majority of your inventory? Where are a lot of the investors in these little sub markets? Do you guys manage a lot? And do you see trends and other you know, sub markets where there's a little bit more traction right now?

Tony:

Yeah. So obviously, you know, the market has changed drastically. In in, I would think just about everywhere. What tenants are looking for, what they're moving to we we started our company in downtown Denver, and so a lot of the inventory that we've had was in that marketplace in in the early 2000s. man that was a great investment market, you could buy a property, you could sit on it for six months, you could do a little updating on it, and then turn around and in six months pull cash out to buy another one. And so, you know, at one point in time, our company we had 27 units from 15th and Larimer to 17th. In Larimer, it was a great market to continue to invest in. And then of course, we all know what happened in 2008 to 2010. That market kind of suffered, and it came back. And they're building a ton of apartment buildings in from January 1 of 2010. Through today, there have been over 25,000 new apartment units built within a one mile radius of where our office used to be at 15th. and Blake, so it's a huge booming market.

Unfortunately, COVID has taken what used to be a destination market in downtown Denver, and really turned it on its head, I mean, all the reasons you would go downtown, the sporting events, the theater, the nightlife, all of that is really sort of been shut down. And all the reasons that you don't want to live in a big city, the reminders of COVID the notes in the elevator, the making sure that you're checking your guests in and out, you know, restricting guest parking, all of these things, has had an impact. So what's interesting about that, is that while downtown Denver used to be a really big destination market, what's happening now is people are leaving those investments as tenants and moving into that next ring out. And so an area like Highlands is really popular as it's become almost as expensive or more expensive than being right in the heart of the city, then you go a little bit further, and there's area over by like Sloan's lake and a little further west. So as you start to go out from the city, those markets become a little bit more affordable as an investor to get into. But because everybody's looking in those markets, it becomes really competitive market and difficult to find a true good investment that you would want to keep for cash flow purposes.

Michael:

And Tony, we were talking a little bit before the show, I used to live out in Colorado and the South East mid kind of mid central Colorado. And Denver was an awesome city. This was like a decade ago, I lived out there and Denver was an awesome city then. And I was there a couple years ago and couldn't even recognize the city, there's been so much change. So can you walk our listeners through a little bit about what's been changing, and kind of what's going on in that in that market?

Tony:

Sure. So to go back a little ways, which I'll just touch on, we had a great railroad system that came through Denver, and there was some reasons why it wound up coming through Denver. And we won't get into that. But we got lucky when they decided to do that. And so we have a very historic Union Station in downtown Denver. And that became the transportation hub. And so we've got really good light rail that takes you out east, out west, north and south. And that sort of opened up people being able to move out into the suburbs and still work in the city. And so what's happened is, as the city has grown, we've gotten a better transportation system, we've got I 25, that runs through the heart of the city, north and south, we've got I 70 that goes east and west. So it's really a good area to live, if you don't want to live right next to your work. And that kind of expands the possibilities of pay. You can live anywhere and and work just about anywhere. And of course we all know that. Even with that the speed of change of what's required to live work ratio. And distance has been dramatically changed over those last year.

Michael:

Yeah, that's really great insight. And then what about companies that are coming or going from Denver, as a market? Has there been much influx of new companies or companies moving in and headquarters there?

Yeah. So we used to have, he used to be back in a couple of decades ago, we were big into oil and gas. And then of course that played itself through its cycle. And then we became a big tech city. And so we've got a lot of tech companies that are here. We've got some banking companies that are here. The interesting thing is we've got a lot of companies that are an employees that actually are from the west coast that seems to be migrating in California, whether politically or financially has become not the right place for those companies to be headquartered anymore. And so we're seeing, you know, more and more moving to Colorado so we still are primarily a tech city.

Tom:

I live just kind of in the suburbs of San Francisco and man, I've got a laundry list of friends that they're either going to Denver, they're going to Austin it's just this mass, that kind of Central migration.

Tony:

Yeah.

Tom:

How would any any like going to curious kind of specific companies you can think of? I know I think Adobe might have a big or any like, you know, like major of those companies kind of specific ones that have to get quarters.

Tony:

Yeah, so we've got DaVita which is downtown, which is not necessarily tech I think they're more dialysis right yeah, yeah Alice's they've got it. They've really come into the city. unexpanded This may be the case everywhere. I don't know. But Amazon has a big presence here. Now they're building their warehouses and they've got, you know, I wouldn't call it a headquarters, they've definitely got a ton of office space that they have here plus their warehouse spaces. Yeah. But as far as like any major players, you know, I don't know that we're really bringing any of the major players in if we are I just don't know who they are. But just a lot of smaller tech companies that are moving here. It's a it's a good place to be in that industry.

Michael:

Well, not in the tech genre, but isn't Coors headquartered there in Colorado as well.

Tony:

That's interesting. Actually. Coors Brewing was started in Golden and I actually run by that brewery quite a bit. And they have been sold to Molson. So now it is Molson Coors,  

Michael:

Canadian.

Tony:

I'm pretty sure. Yeah, they're in Miller Coors. And then they were sold to I don't know, it's not it was Molson. Maybe it was Miller. But anyway, they're no longer actually headquartered here. And so interesting was used to promote their beers with Rocky Mountain spring water rights, and we use that promotion anymore. So interesting out of the Rockies.

Michael:

Interesting. Oh, man. Well, it's it's a good thing. You run by that. That plan. You got a Carbo load while you're running right?

Tom:

Replenish, yeah.

Tony:

Yeah.

Tom:

Kind of related to economy and industry. Talk a little bit about the school's major universities. I know, Denver, I can, you know, top my head. DU and gonna hear about that to the education sector?

Tony:

Yeah, so actually, right out in Golden, right, kind of by the Coors Brewing. You know, golden was a great historic city for us, locally, and they have the Colorado School of Mines, which is a great school. We've got d u, as you had mentioned, we have the Metropolitan MSU there is the CU Boulder, cu Denver campus. And then just about an hour north of us in Fort Collins, there's the Colorado State University, and then they're up in Greeley, we've got the school up there as well. So there's a quite a few universities here.

Tom:

It's great. Yeah, Colorado School of Mines, like my brother in law went to school there fantastic engineering school. Yeah. And we touched on this a little bit, let's talk a little bit about transportation in the area. So you know, major high highway system crossing through, you talked a little about light rail, any other kind of commentary on the just kind of general transportation systems within the Denver market.

Tony:

But I think one of the key components is the light rail, and just how well they've thought that out. Now, of course, with some of the pandemic, it's caused ridership to go down quite a bit. And so they're cutting back on some of the routes and that sort of thing. But just having the infrastructure there, the city and the surrounding cities actually did a really good job coming together and planning out the entire Metro district and the transportation. So light rail is big here, we've got the airport that was moved out into the eastern plains, so that it could be away from the cities and avoid the noise pollution. And then they continue to build new cities around to the airport. So we'll eventually have to deal with those issues again, but you know, DIA Denver International Airport is a major transportation hub. So we've got the light rail actually connect right from you can get off a plane, you know, land from anywhere, get off a plane, take the light rail, right into Union Station from Union Station, you can be almost anywhere in the metropolitan area.

Tom:

You know, something I noticed in the Bay Area is we have our light rail system, the BART system and something I know some investors look at is as the BART is expanding to new stations looking to invest in those type of areas. Do you guys have similar types of dynamics where the light rail is continuing to grow? Or does it cover the footprint pretty well, of the lot of the properties that you guys manage in Denver?

Tony:

It does actually and transportation oriented development or TODs, that's what they talk about. And typically they look at having something within a one mile radius of a light rail stop does increase the value of the property, both for when you're trying to sell it, and also the rentability of the property. This is a side note, but I'm a commissioner for the Arvada urban renewal authority. And we work on 25 year project plans. And I've been doing that as a volunteer for about 13 years. And we study the development and the layout of cities and how to build residential next to these light rail stations so that we can provide workforce housing and make sure that people who need that transportation have access to it and as a real estate investor, it's great to invest near those because they are more in demand. And then as a tenant, you know, if you have that and you have the need or the desire to no longer have a car you can get anywhere in the city from being next to one of those light rail stations.

Tom:

That's fantastic and just kind of thinking about random side note. I love City and Regional plans. Gotta get super interesting that is a minor I like really like playing SimCity as a kid probably, you know, something, if I'm looking at the map of the light rail, what stations would you say, you know, are more common for investors to invest in? And basically, this is the idea for this is for listeners, if they were to pull up the map, like, which areas are the majority of you know, our investment opportunities? You see?

Tony:

It's a good question, I think that that's probably not the best place to start, I think what you would want to do is start and figure out what type of investment you want to make, we all know that there's different types of investments that you can make, you can make investments based off of cash flow, you know, something that's not going to appreciate, but it's providing great cash flow, something that you're sort of rolling the dice on, it's almost paying the bills, or it's paying the bills by time you throw in your HOA, and your taxes and any rehab you have to do, but you're banking on appreciation, and we all know that those are a little bit more risky. But in Denver, the appreciation over the last five years has just gone crazy. I mean, I I kicked myself and for sell, I sold one of my properties in like 2016. And it's almost doubled in price since then, you know, we we were trying to do some things financially to where we wanted to move the money around. And, you know, you always hear investors look back and say, Wow, if I just would have held that, you know, look what it'd be worth now

Michael:

I would be on a beach somewhere?

Tony:

Yeah, yeah, that's the truth. You can look back and see, but so I would start with that and look at what kind of investment you want to make? And then do you want to be the person that's managing it? Do you want to hire a manager and be hands off? Are you looking for a single family home? Are you looking where then you're responsible for the roofs and the gutters and the sewer lines? Or are you looking for something that's in a condo building, or Hoa, or a lot of the external stuff is taken care of for you, but you're counting on the HOA to manage it properly, and spend the money that you're paying them monthly? So I really think it looks, it makes more sense to focus on the type of investment, and then your budget. And then once you've narrowed that down, pick a location, and then from that location, look to see how close you can get to a light rail station.

Michael:

And kind of in that same vein, Tony, can you give kind of a 30,000 foot breakdown of if someone is looking for a cash flow investment or or more of an appreciation play? Where should they look, you know, north, maybe some neighborhoods or some directions from the city center?

Tony:

Yeah, so obviously, we've talked a lot about downtown Denver. And that's, you know, I've got a lot of experience with that market in particular, and downtown Denver has historically continued to appreciate through the years, you know, we've had our ups and downs, just, you know, with the economic issues that we had in the late 2000s. But that area, if you're investing in there, you're probably not cash flowing. Like it's not a great market, you go and drop a bunch of cash, but you're looking at market appreciation.

Green Valley Ranch out east more by the airport, one of these newer neighborhoods that they're building, that's a good neighborhood to invest in. If you're looking for more for cash flow out in Aurora, there's a lot I know a gentleman who owns multiple multiple properties out there. And the he accepts section eight, and he's actually getting, you know, above market rents, because he's buying in an area that is a little bit more of a rougher area. And so he's going in and putting money into it, and he's renting those out accepting section eight. And so that's been a great investment strategy for him. And and we try to we have discussions about whether or not it makes sense to accept the section eight because there's pluses and minuses with it. And he's completely sold on on that. If you're looking for something more on the single family homes that's outside of downtown Denver, and you're looking for appreciation we've already mentioned Highland, so the Highland area just to the west of downtown. And then as you head out towards Arvada, Arvada has a couple of great light rail stations, and their homes are a little bit less expensive than what you might find in other areas. And then Thorton is a good area as well to try to buy something that cash flows for you.

Michael:

Fantastic. And let's just take the last city you mentioned, you know, some market Thorton Can you give, of course, very generically speaking, high level idea of what a three, two single family home you would expect to sell for and what it might rent for.

Tony:

Yeah, so that's, again on those on to buy something like that to get into a home in Thorton. You know, three to 350 is going to be your entry level to be able to get into it and as an investor and unfortunately, that the challenge is if you're looking in that market, in that price range, you're going to see a lot of competition, because that's sort of like the affordable investment entry level in Denver. Right? In for that three to

Tom:

Is it pretty competitive amongst homeowners versus investors as well.

Tony:

It is.

Tom:

Great for appreciation more more buyers to the table. How about you mentioned Green Valley Ranch and I confirm that it is it's Green Valley Ranch kind of near its east kind of near a little bit south of the airport. How about price point? Is that a similar price point in rent or

Tony:

It is, but they're the properties are newer than what you would typically be able to purchase? If you were to purchase up in Thornton.

Michael:

And then those three twos at that three to 350 price point, what would you expect rents to be? Again, just ballparking average?

Tony:

If you are looking at the typical? Three, two, you're probably at about 2500.

Michael:

Okay, awesome.

Tom:

Related to so you had mentioned before somebody would work with before as a pretty big section eight strategy in Aurora and likes it anything notable about the section eight within Denver as in? Are they a little bit? I don't know. Because Because it's pretty different from each municipality to on how they manage. And in any kind of general feedback of, of working with section eight in Denver versus perhaps other areas are curious to hear your feedback.

Tony:

Yeah. So within the last couple of years, we've source of income has been a protected class. So you're no longer able to discriminate. People use discrimination as it's a negative word. And in in most cases, in fair housing, it is a negative word. But there still, there is legal discrimination. For example, before they legalized marijuana, and they went to the medical marijuana, what we found was in a lot of the properties, we were managing people that worked in that industry would also decide that they should, you know, regrow it at home as well, entrepreneurs. Yes. And so we did not accept applications from anybody in the medical marijuana industry. And that was not a moral judgment. It was just as simply we've we've run into too many issues with people turning the basement or even we had a high rise luxury loft a penthouse floor with, you know, glass on two sides, totally open, and they decided that they would tap directly into the building power and bypass the electrical panel. And then they hung a sprinkler system about two feet from where they bypassed any shut off and dropped a drip system. So, so we decided that we would eliminate those people from our tenant pool. And sort of similar tongue in cheek, we won't rent to any attorneys either, because they like to take your lease and give it back to you totally redlined. And so position with that is we will rent to them. But they they get to accept the lease as written.

Michael:

So real quick side story. I used to work in Home Depot when I was in high school, and I get people coming in all the times like, Where are your lights, like go out 27 Oh, and by the way, potting soil is on aisle nine and systems on aisle 27. It's like we cant skip the whole song and dance. I know why we're all here.

Tony:

Yeah. But to tie that back to the section eight conversation, they made it illegal to discriminate based on source of income. And so it's been a big shift for landlords and property managers here who have traditionally stayed away from that. And now they have to accept section eight. And, and to be honest with you, what we've seen is the biggest problem with section eight is not necessarily the tenant, it's the red tape and the bureaucracy, and all of the additional requirements and using the lease, that is not your lease that you came up with, that your attorney came up with, that you created over time. You know, it's it's being forced to enter into an agreement and use documentation that you don't necessarily agree with. And so once you decide that you're okay with rolling the dice and getting involved with that, then on a one off basis, it's not too bad. The issue continues to be where they'll send you one disbursement. And if you own five properties, you get to disseminate how which funds go to which properties and if somebody short pays, or if they adjust somebodies whatever it's called the rental amount that they're getting their voucher. If they adjust their voucher, you don't necessarily get noticed. And so you have to figure out, okay, who was short. And so, again, it's not necessarily that you have a problem with the tenants that move in there in this area, that that you have a problem with the government and some of the bureaucracy that goes along with that.

Tom:

Yeah, leads to some little bit of accounting, counting overhead. On a sort of related note, you know, a question a lot of people ask is landlord friendly laws rent control? Where does Denver set with some of those concepts?

Tony

If you would have asked me three years ago, I would have said, you know, it's the Wild West like we we could we were very landlord friendly. And not to the point where it was abusive but landlords were able to to operate a business here. And it's over the last three years, it has completely turned up on its head, we used to be able to give a three day notice for a pay or quit. So you know, it's your three day, notice when somebody has not yet paid the rent. Now, they extended that to 10 days, they wanted to do 14, then that's been extended to 30 days, because of COVID. I went and fought down at the city Capitol fought the legislation that they were trying to make it so that you could not charge tenants late fees, except for $20 or 3% of the rent, whichever was less. And so if you're going to invest in Denver, you either really need to know the laws very well or hire a property management company. And I'm not trying to, you know, put a plug in for us, obviously, I think you should hire us. But even if you don't, you should hire somebody if you're going to try to manage this from afar, because the legislation in Colorado has, has really changed the game. In in real estate investing out here, it doesn't mean it's not still a great market. And you can't find good opportunities, but it used to just be a lot easier.

Tom:

And probably kind of a moving target with us, as COVID evolves to and some of that vision.

Tony:

Yep.

Michael:

So speaking of COVID, out in the Bay Area, San Francisco, we've seen prices, both on the rental side of things come down and on the sales side come down and now operators, especially in the multifamily space are giving out freebies incentives. What are you seeing in kind of a downtown corridor in Denver? Is it similar is our prices go up? They dropped? What do you see in there?

Tony:

Yeah, so it's very similar to what you're describing out there. The the issue with Denver is that they did just build all of these brand new luxury apartments. And a lot of the the housing stock were initially those really cool funky converted lofts that had the exposed brick, wood beam, timber, you know, ceilings, and the parking was sort of an afterthought. So they dug in these sloped driveways that go down into a sloped garage. And, and people put up with that, because at that time, it was really cool. And you know, the walls in the bedrooms didn't go all the way to the ceiling. And it was just funky and cool and was edgy.

And you know, over the last 10 years or so the interests of the tenants have changed. And so what you see is a lot of the tenants that are moving in there, they're okay with living in smaller spaces. So they've built these units with smaller spaces, but they give you a ton of amenities. So there's, you know, the dog washing station bike repair station, the 24 hour concierge that the Mimosa Mondays, I mean just crazy stuff. And so you've got this issue with the older housing stock in in downtown trying to compete with the demands of the newer offerings from these apartment buildings. And it doesn't mean that there aren't some really cool condos and Lofts, and that are still attracting a lot of interest. But the challenge is, if you've got 10 properties in downtown, and you only have eight tenants that want to move in there, it's become really competitive. And so prices are dropping on rents in downtown and just even getting people to want to move into that environment with COVID going on, I think what it's doing is it's going to open up some really great investment opportunities, depending on how long COVID sticks around and how far rents drop.

But on the sales side in downtown, we're still seeing a strong sales market. And actually what's happening as people are moving out of downtown, they're moving into the surrounding suburbs. And so rent in the suburbs are actually going up because of this, where it's just a shift. So it's not the I kind of equate what's happening with COVID to dumping a five gallon bucket into a bathtub, like our market is going to absorb that five gallons of water. But it's just going to shake things up a bit. And so we'll we'll see a balancing out where people will start coming back to the city once the city's able to open back up.

Tom:

I think I've noticed a similar trend in that the higher rents have really been punished a little bit more, especially for workers that have more optionality with working from home like one of our mountain destinations, Taho prices have gone way up. But you know, in the heart of San Francisco, they've dropped but in the suburbs, they continue to go up. It's you know, people who I think probably at the lower price range, I bet there's probably been more demand like you've seen, especially for single family houses for people who are looking for a little more space and getting out of an apartment complex. I mean, it's really interesting dynamics at play. I love your analogy of that dropping a five gallon bucket into a bathtub. Well, yeah, we'll shake it up a little bit, but ultimately, the buckets going to the bottom of the bathtub.

Michael:

I'm curious Tony to know what you're seeing in the market in terms of Of how hard it is for sales. Because I think a lot of people when COVID first hit, were like, this is gonna be awesome, gonna pick up tons of cheap property, it's going to be great. But I think kind of nationally, we're seeing that things are still continued to be red hot. Now people that are moving out of apartments are looking to buy single family homes. So what are you seeing in the single family market out there?

Tony:

Yeah, we're seeing the same thing out here, the the opportunity to pick up a bunch of great deals simply because COVID hit didn't materialize, there's still a big demand, I think, as real estate agents, they've had to learn how to adapt to be able to sell property. And you know, I think as a seller, having people come in and out of your home without being pre qualified. And, you know, I think there's still some hesitation of that. But once you've decided to sell your home, you do what it takes to sell your home. And so, you know, there was this initial period where the governor shut us down and said that we couldn't do in person showings and things like that. But we're past that now. It may be coming back, we've been given some warnings, I guess, over those last week that if we don't get things under control, that we may wind up going back to being totally shut down.

But it's the same thing. I think, in anything, people experience crisis fatigue, and so they can only be scared and wound up for so long before, they just have to start getting back to some sort of normalcy. And that's what we're seeing in the real estate industry is it paused for a brief second, and then we're back on track and sales continue to remain strong sales prices remain strong. And we're not getting the crazy, you know, 20 and 30. Multiple offer scenarios on every property like we were at one point a year or two ago. But there's still a strong demand.

Michael:

I think that's super important to take note of for all of our listeners, we're recording this mid November. And depending on when you're listening to this, to keep that in mind, if you are going to be going into that market. That sounds like you're not going to be picking up properties offering 20% less than asking it, it sounds like things are still quite strong out there.

Tony:

So I want to circle back around on that you talked about if people are coming to this market to invest, one of the things that I've talked a lot about some of the negatives of what's going on in downtown Denver, you know what's going on in our marketplace. But you know, those are, I still think temporary, Denver continues to be a fantastic place to live. And as you guys have already talked about people are moving here from other cities. And so it's not that people are leaving from here, it's just that the getting the great deal is is getting harder to find. The good deals are still available all over the place. The great deals are hard to find. And so, you know, we live really close to the mountains, you can be skiing, there's great lakes, there's great weather, you know, there's great entertainment, we have, I think seven professional sports teams. Like there's just a ton of stuff to do here. So it continues to be a great destination. It's just the investment environment has changed slightly and you just need to, to be able to adapt to be able to find the good deals here.

Tom:

Michael, do you have any other questions you want to ask?

Michael:

Now? I think I'm all tapped out. All right, Tony.

Tom:

I'm going to end it with one final question. So you have two meals to get in Denver. I want to know what the restaurant is and what you're ordering. And the first category of meal is this is this is fancy date night, you know, something something special. And the second one is like oh man, I'm really hungry. I need something quick. I need something, you know, a greasy or whatever. So let me hear your input on the two restaurants and meals are good.

Tony:

Okay. I love the closing questions. Okay. So the first one is there's a good restaurant downtown, I think it's probably a chain, but there's Ocean Prime is in downtown Denver is half of like 15th and market maybe. And that's a great upscale place. And the reason I like it is not only can you get a great meal there, but then you're right in the heart of everything to continue your evening with any other sort of entertainment that you'd want. The next meal that I will have to go with is there's a Mexican restaurant called de Corazon in downtown Denver. It's just a little family run Mexican restaurant, and they have just really good food. So those would be my two choices.

Tom:

Love it. Awesome, Tony. Well, thank you so much for coming on with us today and for all the insights in the Denver market.

Tony:

Absolutely. Thanks for having me.

Tom:

Thanks, everybody for listening. If you enjoy the remote real estate investor, please like us. Subscribe. All that good stuff. Give us give us a rating and happy investing.

Michael:

Happy investing.

In this episode we dig into the Denver market with Tony Cline from Home Vault. homevault.com

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Transcription

Tom:

Greetings, and welcome to The Remote Real Estate Investor. My name is Tom Schneider. And today we have a special guest, Tony Cline, who is the chief expansion officer at home vault. And today we're going to be doing a market deep dive on the Denver market. And I'm joined with my co host,

Michael:

Michael Albaum.

Tom:

All right, Michael, let's get into it.

Theme song

Tom:

Tony, let's learn a little bit about yourself.

Tony

Yeah, so we came together, there's a few of us companies that came together. And we've been working on this for a while, that we've realized that the market is really changing. technology's changing, legislation is changing. And we started as a mastermind, trying to figure out, you know, how could we stay out in front of all of these changes as real estate investors or as a property management company and continue to provide good quality service to our clients and to our tenants? And it just turned into rather than just being a brain brainstorm, let's go ahead and let's actually create a company. So we've been working on that for about a year and a half. And we've rolled that out.

And it's really exciting to be able to see the things that we're doing to stay out in front of all of these changes, like the legislation and technology and market shifts and differences in what tenants are looking for now compared to what they were looking for in a property five years ago. That's a little bit of my professional background. My personal background is I'm an ultra marathoner and like to spend a lot of time up in the woods, running from something I guess.

Tom:

Denver is a great place that are a very, I guess, hardcore would be a place to be an ultra marathoner.

Tony:

Yeah, there's a lot of greats out here for sure.

Tom:

Gosh what was a that book, Born to Run. It was like talking about his Yeah,

Tony

Yeah. Scott Jurek is he's located out here. Now. He was from I think, Minnesota when he was in that book. But he's out here now and but up in Boulder.

Tom:

Awesome. And what did you do before before Home Vault?

Tony:

So before Humboldt, my company that I merged into the merger was started in 1978. And it was a company that was started in downtown Denver. And the gentleman who started it actually wanted to open a REMAX franchise in downtown Denver. And in 1978, the REMAX company said, we're not willing to open an office there, because there's not enough residential business to support an office. You know, obviously, Flash forward 40 years and, you know, the downtown Denver is booming. And there's a ton of people there, but I bought that business in 2000. And prior to that, I was in the technology business. So I had a company that focused on document and data management. And, and then in 2000, I switched over to being a full time real estate agent, property investor and property manager.

Tom:

Awesome. Fantastic. Let's go ahead and jump into it. So what I'd like to do at the start of these discussion is, so we have the anchor city of Denver, how would you describe some of the other sub markets within Denver? And you know, maybe a way to do this is to kind of think about is Denver as maybe a clock or ways to kind of like have think about sub markets within Denver?

Tony:

Yeah, sure. So Denver, there's actually the city and county of Denver, which is our state capitol, and from their you know, they're really like most big cities, there's no true dividing lines. When you're visually you know, legally obviously there is but when you're looking at it, just one big metropolitan area so if you were to look at that, you know, Denver kind of goes up north into like Thornton in North Glen Broomfield. If it goes off to the east, you've got Aurora, Greenwood Valley, and then South you've got down into Parker, Colorado Springs in Colorado Springs used to be its own metropolitan area. And now in between there Castle Rock is filling in there's just, well, Colorado Springs is still kind of its own unique identity. What used to be open space is now filling in. And then if you go west from Denver, you've got cities like Arvada and Golden, Lakewood, wheat Ridge, there's a lot of different sub markets with different property types.

Tom:

As a property management company, where do you guys see the majority of your inventory? Where are a lot of the investors in these little sub markets? Do you guys manage a lot? And do you see trends and other you know, sub markets where there's a little bit more traction right now?

Tony:

Yeah. So obviously, you know, the market has changed drastically. In in, I would think just about everywhere. What tenants are looking for, what they're moving to we we started our company in downtown Denver, and so a lot of the inventory that we've had was in that marketplace in in the early 2000s. man that was a great investment market, you could buy a property, you could sit on it for six months, you could do a little updating on it, and then turn around and in six months pull cash out to buy another one. And so, you know, at one point in time, our company we had 27 units from 15th and Larimer to 17th. In Larimer, it was a great market to continue to invest in. And then of course, we all know what happened in 2008 to 2010. That market kind of suffered, and it came back. And they're building a ton of apartment buildings in from January 1 of 2010. Through today, there have been over 25,000 new apartment units built within a one mile radius of where our office used to be at 15th. and Blake, so it's a huge booming market.

Unfortunately, COVID has taken what used to be a destination market in downtown Denver, and really turned it on its head, I mean, all the reasons you would go downtown, the sporting events, the theater, the nightlife, all of that is really sort of been shut down. And all the reasons that you don't want to live in a big city, the reminders of COVID the notes in the elevator, the making sure that you're checking your guests in and out, you know, restricting guest parking, all of these things, has had an impact. So what's interesting about that, is that while downtown Denver used to be a really big destination market, what's happening now is people are leaving those investments as tenants and moving into that next ring out. And so an area like Highlands is really popular as it's become almost as expensive or more expensive than being right in the heart of the city, then you go a little bit further, and there's area over by like Sloan's lake and a little further west. So as you start to go out from the city, those markets become a little bit more affordable as an investor to get into. But because everybody's looking in those markets, it becomes really competitive market and difficult to find a true good investment that you would want to keep for cash flow purposes.

Michael:

And Tony, we were talking a little bit before the show, I used to live out in Colorado and the South East mid kind of mid central Colorado. And Denver was an awesome city. This was like a decade ago, I lived out there and Denver was an awesome city then. And I was there a couple years ago and couldn't even recognize the city, there's been so much change. So can you walk our listeners through a little bit about what's been changing, and kind of what's going on in that in that market?

Tony:

Sure. So to go back a little ways, which I'll just touch on, we had a great railroad system that came through Denver, and there was some reasons why it wound up coming through Denver. And we won't get into that. But we got lucky when they decided to do that. And so we have a very historic Union Station in downtown Denver. And that became the transportation hub. And so we've got really good light rail that takes you out east, out west, north and south. And that sort of opened up people being able to move out into the suburbs and still work in the city. And so what's happened is, as the city has grown, we've gotten a better transportation system, we've got I 25, that runs through the heart of the city, north and south, we've got I 70 that goes east and west. So it's really a good area to live, if you don't want to live right next to your work. And that kind of expands the possibilities of pay. You can live anywhere and and work just about anywhere. And of course we all know that. Even with that the speed of change of what's required to live work ratio. And distance has been dramatically changed over those last year.

Michael:

Yeah, that's really great insight. And then what about companies that are coming or going from Denver, as a market? Has there been much influx of new companies or companies moving in and headquarters there?

Yeah. So we used to have, he used to be back in a couple of decades ago, we were big into oil and gas. And then of course that played itself through its cycle. And then we became a big tech city. And so we've got a lot of tech companies that are here. We've got some banking companies that are here. The interesting thing is we've got a lot of companies that are an employees that actually are from the west coast that seems to be migrating in California, whether politically or financially has become not the right place for those companies to be headquartered anymore. And so we're seeing, you know, more and more moving to Colorado so we still are primarily a tech city.

Tom:

I live just kind of in the suburbs of San Francisco and man, I've got a laundry list of friends that they're either going to Denver, they're going to Austin it's just this mass, that kind of Central migration.

Tony:

Yeah.

Tom:

How would any any like going to curious kind of specific companies you can think of? I know I think Adobe might have a big or any like, you know, like major of those companies kind of specific ones that have to get quarters.

Tony:

Yeah, so we've got DaVita which is downtown, which is not necessarily tech I think they're more dialysis right yeah, yeah Alice's they've got it. They've really come into the city. unexpanded This may be the case everywhere. I don't know. But Amazon has a big presence here. Now they're building their warehouses and they've got, you know, I wouldn't call it a headquarters, they've definitely got a ton of office space that they have here plus their warehouse spaces. Yeah. But as far as like any major players, you know, I don't know that we're really bringing any of the major players in if we are I just don't know who they are. But just a lot of smaller tech companies that are moving here. It's a it's a good place to be in that industry.

Michael:

Well, not in the tech genre, but isn't Coors headquartered there in Colorado as well.

Tony:

That's interesting. Actually. Coors Brewing was started in Golden and I actually run by that brewery quite a bit. And they have been sold to Molson. So now it is Molson Coors,  

Michael:

Canadian.

Tony:

I'm pretty sure. Yeah, they're in Miller Coors. And then they were sold to I don't know, it's not it was Molson. Maybe it was Miller. But anyway, they're no longer actually headquartered here. And so interesting was used to promote their beers with Rocky Mountain spring water rights, and we use that promotion anymore. So interesting out of the Rockies.

Michael:

Interesting. Oh, man. Well, it's it's a good thing. You run by that. That plan. You got a Carbo load while you're running right?

Tom:

Replenish, yeah.

Tony:

Yeah.

Tom:

Kind of related to economy and industry. Talk a little bit about the school's major universities. I know, Denver, I can, you know, top my head. DU and gonna hear about that to the education sector?

Tony:

Yeah, so actually, right out in Golden, right, kind of by the Coors Brewing. You know, golden was a great historic city for us, locally, and they have the Colorado School of Mines, which is a great school. We've got d u, as you had mentioned, we have the Metropolitan MSU there is the CU Boulder, cu Denver campus. And then just about an hour north of us in Fort Collins, there's the Colorado State University, and then they're up in Greeley, we've got the school up there as well. So there's a quite a few universities here.

Tom:

It's great. Yeah, Colorado School of Mines, like my brother in law went to school there fantastic engineering school. Yeah. And we touched on this a little bit, let's talk a little bit about transportation in the area. So you know, major high highway system crossing through, you talked a little about light rail, any other kind of commentary on the just kind of general transportation systems within the Denver market.

Tony:

But I think one of the key components is the light rail, and just how well they've thought that out. Now, of course, with some of the pandemic, it's caused ridership to go down quite a bit. And so they're cutting back on some of the routes and that sort of thing. But just having the infrastructure there, the city and the surrounding cities actually did a really good job coming together and planning out the entire Metro district and the transportation. So light rail is big here, we've got the airport that was moved out into the eastern plains, so that it could be away from the cities and avoid the noise pollution. And then they continue to build new cities around to the airport. So we'll eventually have to deal with those issues again, but you know, DIA Denver International Airport is a major transportation hub. So we've got the light rail actually connect right from you can get off a plane, you know, land from anywhere, get off a plane, take the light rail, right into Union Station from Union Station, you can be almost anywhere in the metropolitan area.

Tom:

You know, something I noticed in the Bay Area is we have our light rail system, the BART system and something I know some investors look at is as the BART is expanding to new stations looking to invest in those type of areas. Do you guys have similar types of dynamics where the light rail is continuing to grow? Or does it cover the footprint pretty well, of the lot of the properties that you guys manage in Denver?

Tony:

It does actually and transportation oriented development or TODs, that's what they talk about. And typically they look at having something within a one mile radius of a light rail stop does increase the value of the property, both for when you're trying to sell it, and also the rentability of the property. This is a side note, but I'm a commissioner for the Arvada urban renewal authority. And we work on 25 year project plans. And I've been doing that as a volunteer for about 13 years. And we study the development and the layout of cities and how to build residential next to these light rail stations so that we can provide workforce housing and make sure that people who need that transportation have access to it and as a real estate investor, it's great to invest near those because they are more in demand. And then as a tenant, you know, if you have that and you have the need or the desire to no longer have a car you can get anywhere in the city from being next to one of those light rail stations.

Tom:

That's fantastic and just kind of thinking about random side note. I love City and Regional plans. Gotta get super interesting that is a minor I like really like playing SimCity as a kid probably, you know, something, if I'm looking at the map of the light rail, what stations would you say, you know, are more common for investors to invest in? And basically, this is the idea for this is for listeners, if they were to pull up the map, like, which areas are the majority of you know, our investment opportunities? You see?

Tony:

It's a good question, I think that that's probably not the best place to start, I think what you would want to do is start and figure out what type of investment you want to make, we all know that there's different types of investments that you can make, you can make investments based off of cash flow, you know, something that's not going to appreciate, but it's providing great cash flow, something that you're sort of rolling the dice on, it's almost paying the bills, or it's paying the bills by time you throw in your HOA, and your taxes and any rehab you have to do, but you're banking on appreciation, and we all know that those are a little bit more risky. But in Denver, the appreciation over the last five years has just gone crazy. I mean, I I kicked myself and for sell, I sold one of my properties in like 2016. And it's almost doubled in price since then, you know, we we were trying to do some things financially to where we wanted to move the money around. And, you know, you always hear investors look back and say, Wow, if I just would have held that, you know, look what it'd be worth now

Michael:

I would be on a beach somewhere?

Tony:

Yeah, yeah, that's the truth. You can look back and see, but so I would start with that and look at what kind of investment you want to make? And then do you want to be the person that's managing it? Do you want to hire a manager and be hands off? Are you looking for a single family home? Are you looking where then you're responsible for the roofs and the gutters and the sewer lines? Or are you looking for something that's in a condo building, or Hoa, or a lot of the external stuff is taken care of for you, but you're counting on the HOA to manage it properly, and spend the money that you're paying them monthly? So I really think it looks, it makes more sense to focus on the type of investment, and then your budget. And then once you've narrowed that down, pick a location, and then from that location, look to see how close you can get to a light rail station.

Michael:

And kind of in that same vein, Tony, can you give kind of a 30,000 foot breakdown of if someone is looking for a cash flow investment or or more of an appreciation play? Where should they look, you know, north, maybe some neighborhoods or some directions from the city center?

Tony:

Yeah, so obviously, we've talked a lot about downtown Denver. And that's, you know, I've got a lot of experience with that market in particular, and downtown Denver has historically continued to appreciate through the years, you know, we've had our ups and downs, just, you know, with the economic issues that we had in the late 2000s. But that area, if you're investing in there, you're probably not cash flowing. Like it's not a great market, you go and drop a bunch of cash, but you're looking at market appreciation.

Green Valley Ranch out east more by the airport, one of these newer neighborhoods that they're building, that's a good neighborhood to invest in. If you're looking for more for cash flow out in Aurora, there's a lot I know a gentleman who owns multiple multiple properties out there. And the he accepts section eight, and he's actually getting, you know, above market rents, because he's buying in an area that is a little bit more of a rougher area. And so he's going in and putting money into it, and he's renting those out accepting section eight. And so that's been a great investment strategy for him. And and we try to we have discussions about whether or not it makes sense to accept the section eight because there's pluses and minuses with it. And he's completely sold on on that. If you're looking for something more on the single family homes that's outside of downtown Denver, and you're looking for appreciation we've already mentioned Highland, so the Highland area just to the west of downtown. And then as you head out towards Arvada, Arvada has a couple of great light rail stations, and their homes are a little bit less expensive than what you might find in other areas. And then Thorton is a good area as well to try to buy something that cash flows for you.

Michael:

Fantastic. And let's just take the last city you mentioned, you know, some market Thorton Can you give, of course, very generically speaking, high level idea of what a three, two single family home you would expect to sell for and what it might rent for.

Tony:

Yeah, so that's, again on those on to buy something like that to get into a home in Thorton. You know, three to 350 is going to be your entry level to be able to get into it and as an investor and unfortunately, that the challenge is if you're looking in that market, in that price range, you're going to see a lot of competition, because that's sort of like the affordable investment entry level in Denver. Right? In for that three to

Tom:

Is it pretty competitive amongst homeowners versus investors as well.

Tony:

It is.

Tom:

Great for appreciation more more buyers to the table. How about you mentioned Green Valley Ranch and I confirm that it is it's Green Valley Ranch kind of near its east kind of near a little bit south of the airport. How about price point? Is that a similar price point in rent or

Tony:

It is, but they're the properties are newer than what you would typically be able to purchase? If you were to purchase up in Thornton.

Michael:

And then those three twos at that three to 350 price point, what would you expect rents to be? Again, just ballparking average?

Tony:

If you are looking at the typical? Three, two, you're probably at about 2500.

Michael:

Okay, awesome.

Tom:

Related to so you had mentioned before somebody would work with before as a pretty big section eight strategy in Aurora and likes it anything notable about the section eight within Denver as in? Are they a little bit? I don't know. Because Because it's pretty different from each municipality to on how they manage. And in any kind of general feedback of, of working with section eight in Denver versus perhaps other areas are curious to hear your feedback.

Tony:

Yeah. So within the last couple of years, we've source of income has been a protected class. So you're no longer able to discriminate. People use discrimination as it's a negative word. And in in most cases, in fair housing, it is a negative word. But there still, there is legal discrimination. For example, before they legalized marijuana, and they went to the medical marijuana, what we found was in a lot of the properties, we were managing people that worked in that industry would also decide that they should, you know, regrow it at home as well, entrepreneurs. Yes. And so we did not accept applications from anybody in the medical marijuana industry. And that was not a moral judgment. It was just as simply we've we've run into too many issues with people turning the basement or even we had a high rise luxury loft a penthouse floor with, you know, glass on two sides, totally open, and they decided that they would tap directly into the building power and bypass the electrical panel. And then they hung a sprinkler system about two feet from where they bypassed any shut off and dropped a drip system. So, so we decided that we would eliminate those people from our tenant pool. And sort of similar tongue in cheek, we won't rent to any attorneys either, because they like to take your lease and give it back to you totally redlined. And so position with that is we will rent to them. But they they get to accept the lease as written.

Michael:

So real quick side story. I used to work in Home Depot when I was in high school, and I get people coming in all the times like, Where are your lights, like go out 27 Oh, and by the way, potting soil is on aisle nine and systems on aisle 27. It's like we cant skip the whole song and dance. I know why we're all here.

Tony:

Yeah. But to tie that back to the section eight conversation, they made it illegal to discriminate based on source of income. And so it's been a big shift for landlords and property managers here who have traditionally stayed away from that. And now they have to accept section eight. And, and to be honest with you, what we've seen is the biggest problem with section eight is not necessarily the tenant, it's the red tape and the bureaucracy, and all of the additional requirements and using the lease, that is not your lease that you came up with, that your attorney came up with, that you created over time. You know, it's it's being forced to enter into an agreement and use documentation that you don't necessarily agree with. And so once you decide that you're okay with rolling the dice and getting involved with that, then on a one off basis, it's not too bad. The issue continues to be where they'll send you one disbursement. And if you own five properties, you get to disseminate how which funds go to which properties and if somebody short pays, or if they adjust somebodies whatever it's called the rental amount that they're getting their voucher. If they adjust their voucher, you don't necessarily get noticed. And so you have to figure out, okay, who was short. And so, again, it's not necessarily that you have a problem with the tenants that move in there in this area, that that you have a problem with the government and some of the bureaucracy that goes along with that.

Tom:

Yeah, leads to some little bit of accounting, counting overhead. On a sort of related note, you know, a question a lot of people ask is landlord friendly laws rent control? Where does Denver set with some of those concepts?

Tony

If you would have asked me three years ago, I would have said, you know, it's the Wild West like we we could we were very landlord friendly. And not to the point where it was abusive but landlords were able to to operate a business here. And it's over the last three years, it has completely turned up on its head, we used to be able to give a three day notice for a pay or quit. So you know, it's your three day, notice when somebody has not yet paid the rent. Now, they extended that to 10 days, they wanted to do 14, then that's been extended to 30 days, because of COVID. I went and fought down at the city Capitol fought the legislation that they were trying to make it so that you could not charge tenants late fees, except for $20 or 3% of the rent, whichever was less. And so if you're going to invest in Denver, you either really need to know the laws very well or hire a property management company. And I'm not trying to, you know, put a plug in for us, obviously, I think you should hire us. But even if you don't, you should hire somebody if you're going to try to manage this from afar, because the legislation in Colorado has, has really changed the game. In in real estate investing out here, it doesn't mean it's not still a great market. And you can't find good opportunities, but it used to just be a lot easier.

Tom:

And probably kind of a moving target with us, as COVID evolves to and some of that vision.

Tony:

Yep.

Michael:

So speaking of COVID, out in the Bay Area, San Francisco, we've seen prices, both on the rental side of things come down and on the sales side come down and now operators, especially in the multifamily space are giving out freebies incentives. What are you seeing in kind of a downtown corridor in Denver? Is it similar is our prices go up? They dropped? What do you see in there?

Tony:

Yeah, so it's very similar to what you're describing out there. The the issue with Denver is that they did just build all of these brand new luxury apartments. And a lot of the the housing stock were initially those really cool funky converted lofts that had the exposed brick, wood beam, timber, you know, ceilings, and the parking was sort of an afterthought. So they dug in these sloped driveways that go down into a sloped garage. And, and people put up with that, because at that time, it was really cool. And you know, the walls in the bedrooms didn't go all the way to the ceiling. And it was just funky and cool and was edgy.

And you know, over the last 10 years or so the interests of the tenants have changed. And so what you see is a lot of the tenants that are moving in there, they're okay with living in smaller spaces. So they've built these units with smaller spaces, but they give you a ton of amenities. So there's, you know, the dog washing station bike repair station, the 24 hour concierge that the Mimosa Mondays, I mean just crazy stuff. And so you've got this issue with the older housing stock in in downtown trying to compete with the demands of the newer offerings from these apartment buildings. And it doesn't mean that there aren't some really cool condos and Lofts, and that are still attracting a lot of interest. But the challenge is, if you've got 10 properties in downtown, and you only have eight tenants that want to move in there, it's become really competitive. And so prices are dropping on rents in downtown and just even getting people to want to move into that environment with COVID going on, I think what it's doing is it's going to open up some really great investment opportunities, depending on how long COVID sticks around and how far rents drop.

But on the sales side in downtown, we're still seeing a strong sales market. And actually what's happening as people are moving out of downtown, they're moving into the surrounding suburbs. And so rent in the suburbs are actually going up because of this, where it's just a shift. So it's not the I kind of equate what's happening with COVID to dumping a five gallon bucket into a bathtub, like our market is going to absorb that five gallons of water. But it's just going to shake things up a bit. And so we'll we'll see a balancing out where people will start coming back to the city once the city's able to open back up.

Tom:

I think I've noticed a similar trend in that the higher rents have really been punished a little bit more, especially for workers that have more optionality with working from home like one of our mountain destinations, Taho prices have gone way up. But you know, in the heart of San Francisco, they've dropped but in the suburbs, they continue to go up. It's you know, people who I think probably at the lower price range, I bet there's probably been more demand like you've seen, especially for single family houses for people who are looking for a little more space and getting out of an apartment complex. I mean, it's really interesting dynamics at play. I love your analogy of that dropping a five gallon bucket into a bathtub. Well, yeah, we'll shake it up a little bit, but ultimately, the buckets going to the bottom of the bathtub.

Michael:

I'm curious Tony to know what you're seeing in the market in terms of Of how hard it is for sales. Because I think a lot of people when COVID first hit, were like, this is gonna be awesome, gonna pick up tons of cheap property, it's going to be great. But I think kind of nationally, we're seeing that things are still continued to be red hot. Now people that are moving out of apartments are looking to buy single family homes. So what are you seeing in the single family market out there?

Tony:

Yeah, we're seeing the same thing out here, the the opportunity to pick up a bunch of great deals simply because COVID hit didn't materialize, there's still a big demand, I think, as real estate agents, they've had to learn how to adapt to be able to sell property. And you know, I think as a seller, having people come in and out of your home without being pre qualified. And, you know, I think there's still some hesitation of that. But once you've decided to sell your home, you do what it takes to sell your home. And so, you know, there was this initial period where the governor shut us down and said that we couldn't do in person showings and things like that. But we're past that now. It may be coming back, we've been given some warnings, I guess, over those last week that if we don't get things under control, that we may wind up going back to being totally shut down.

But it's the same thing. I think, in anything, people experience crisis fatigue, and so they can only be scared and wound up for so long before, they just have to start getting back to some sort of normalcy. And that's what we're seeing in the real estate industry is it paused for a brief second, and then we're back on track and sales continue to remain strong sales prices remain strong. And we're not getting the crazy, you know, 20 and 30. Multiple offer scenarios on every property like we were at one point a year or two ago. But there's still a strong demand.

Michael:

I think that's super important to take note of for all of our listeners, we're recording this mid November. And depending on when you're listening to this, to keep that in mind, if you are going to be going into that market. That sounds like you're not going to be picking up properties offering 20% less than asking it, it sounds like things are still quite strong out there.

Tony:

So I want to circle back around on that you talked about if people are coming to this market to invest, one of the things that I've talked a lot about some of the negatives of what's going on in downtown Denver, you know what's going on in our marketplace. But you know, those are, I still think temporary, Denver continues to be a fantastic place to live. And as you guys have already talked about people are moving here from other cities. And so it's not that people are leaving from here, it's just that the getting the great deal is is getting harder to find. The good deals are still available all over the place. The great deals are hard to find. And so, you know, we live really close to the mountains, you can be skiing, there's great lakes, there's great weather, you know, there's great entertainment, we have, I think seven professional sports teams. Like there's just a ton of stuff to do here. So it continues to be a great destination. It's just the investment environment has changed slightly and you just need to, to be able to adapt to be able to find the good deals here.

Tom:

Michael, do you have any other questions you want to ask?

Michael:

Now? I think I'm all tapped out. All right, Tony.

Tom:

I'm going to end it with one final question. So you have two meals to get in Denver. I want to know what the restaurant is and what you're ordering. And the first category of meal is this is this is fancy date night, you know, something something special. And the second one is like oh man, I'm really hungry. I need something quick. I need something, you know, a greasy or whatever. So let me hear your input on the two restaurants and meals are good.

Tony:

Okay. I love the closing questions. Okay. So the first one is there's a good restaurant downtown, I think it's probably a chain, but there's Ocean Prime is in downtown Denver is half of like 15th and market maybe. And that's a great upscale place. And the reason I like it is not only can you get a great meal there, but then you're right in the heart of everything to continue your evening with any other sort of entertainment that you'd want. The next meal that I will have to go with is there's a Mexican restaurant called de Corazon in downtown Denver. It's just a little family run Mexican restaurant, and they have just really good food. So those would be my two choices.

Tom:

Love it. Awesome, Tony. Well, thank you so much for coming on with us today and for all the insights in the Denver market.

Tony:

Absolutely. Thanks for having me.

Tom:

Thanks, everybody for listening. If you enjoy the remote real estate investor, please like us. Subscribe. All that good stuff. Give us give us a rating and happy investing.

Michael:

Happy investing.

Michael:

Hey everybody, welcome to another episode of The Remote Real Estate Investor. I'm Michael Albaum and today we're gonna be doing our weekend wisdom. I'm joined by Dana Dunford, the CEO and co-founder of Hemlane, who we have on an upcoming episode to dive deeper into what they do as a company. But I wanted to talk with Dana today about some recommendations that she has for folks who are doing self-management. Let's get into it.

Michael:

So Dana, curious to get for our listeners, your best advice, input, recommendation for folks that are looking to self manage, because you've been on the professional management end of the things you've done on the self management end of things, and now you've got hemline kind of in the middle? If someone's looking to self manage, what can you what tips tricks, advice would you share?

Dana

First is education hands down. And I do believe that Roofstock has an academy for this as well. But educating yourself on how to mitigate risk? And really what I mean by how do you qualify tenants? How do you set up the lease contracts like the lease contract will make or break you? And then how do you make sure that as you're going through with repair coordination, which service professionals you're sending out, even rent collection? What are the best ways to collect rents like Venmo, credit cards, PayPal can all be disputed in a heartbeat like that. Those are terrible ways to collect rent,

Michael:

I thought you're gonna say those are all great ways. I was like, Oh, awesome.

Dana

No! So I think one of the biggest things is education. And then the second thing is do what you love. Because there's so much when you think about property management, you have to be a jack of all trades. You have to be good at accounting at sales at being a lawyer, right lease, contract, maintenance and repair, you're not good at all of it. So if you're going to self manage, figure out what you're really good at, and use other folks and other professionals to help you with what you're not good at. And that will really help you succeed.

Michael:                                               

Well, that was our episode, everybody. Thank you so much, Dana for the weekend. Wisdom really, really great tips for everybody out there looking to self manage, greatly appreciate it. If you'd like this episode, feel free to give us a rating and review wherever it is using your podcast. We'd greatly appreciate it as they really help us out. Thanks so much for listening. We'll see on the next one. Happy investing

Michael:

Hey everybody, welcome to another episode of The Remote Real Estate Investor. I'm Michael Albaum and today we're gonna be doing our weekend wisdom. I'm joined by Dana Dunford, the CEO and co-founder of Hemlane, who we have on an upcoming episode to dive deeper into what they do as a company. But I wanted to talk with Dana today about some recommendations that she has for folks who are doing self-management. Let's get into it.

Michael:

So Dana, curious to get for our listeners, your best advice, input, recommendation for folks that are looking to self manage, because you've been on the professional management end of the things you've done on the self management end of things, and now you've got hemline kind of in the middle? If someone's looking to self manage, what can you what tips tricks, advice would you share?

Dana

First is education hands down. And I do believe that Roofstock has an academy for this as well. But educating yourself on how to mitigate risk? And really what I mean by how do you qualify tenants? How do you set up the lease contracts like the lease contract will make or break you? And then how do you make sure that as you're going through with repair coordination, which service professionals you're sending out, even rent collection? What are the best ways to collect rents like Venmo, credit cards, PayPal can all be disputed in a heartbeat like that. Those are terrible ways to collect rent,

Michael:

I thought you're gonna say those are all great ways. I was like, Oh, awesome.

Dana

No! So I think one of the biggest things is education. And then the second thing is do what you love. Because there's so much when you think about property management, you have to be a jack of all trades. You have to be good at accounting at sales at being a lawyer, right lease, contract, maintenance and repair, you're not good at all of it. So if you're going to self manage, figure out what you're really good at, and use other folks and other professionals to help you with what you're not good at. And that will really help you succeed.

Michael:                                               

Well, that was our episode, everybody. Thank you so much, Dana for the weekend. Wisdom really, really great tips for everybody out there looking to self manage, greatly appreciate it. If you'd like this episode, feel free to give us a rating and review wherever it is using your podcast. We'd greatly appreciate it as they really help us out. Thanks so much for listening. We'll see on the next one. Happy investing

In this episode, Tom Speaks with Susan Davenport, the Chief Economic Officer for the Greater Houston Partnership, about the economic, educational and cultural aspects of the City of Houston.  

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Transcription

Tom:

Greetings, and welcome to The Remote Real Estate Investor. On today's episode, we have Susan Davenport, who is the Chief Economic Officer for the Greater Houston Partnership. And on this episode, we're going to deep dive into Houston, talk about points of interest, talk about the economy, and all that good stuff. All right, let's do it.

Theme Song

Tom:

Before we get going and talking about Houston, Susan, why don't you tell us a little bit about yourself, as well as the Greater Houston partnership?

Susan:

Yeah, wonderful. Well, thank you again, Tom, for having me this afternoon. Again, my name is Susan Davenport. I'm the chief Economic Development Officer for the Greater Houston Partnership. And we are the region's lead business organization. We serve a 12 County Greater Houston region that represents our membership base represents more than 1000 businesses and institutions throughout Greater Houston in that regional effort. Our members, the member companies that are part of our organization account for about one fifth of Houston's workforce.

So we have many large corporations as well as small and medium sized enterprises as well. So we have three areas of focus. One is to promote economic development and trade. The second is to advocate for effective public policy. And then the third is that we convene regional businesses and Houstonians on key issues affecting our region. Now, the Greater Houston partnership is an organization that has its roots and founding actually from 1840. We were the Houston Chamber of Commerce, was founded again in 1840. And then in 1989, there was a merger with what was founded following the Chamber's initiation in 1840, there was the World Trade Center of Houston and international leadership entity in regard to international business and trade, and then the Economic Development Council of Houston.

And so all three of those entities in 1989, joined under one umbrella organization, the Greater Houston partnership, and that's very indicative of the type of activity you see within our organization, again, having about 1000 member businesses and institutions that speaks to our chamber side, right. And our chamber roots, my team, which does economic development, and international investment and trade that harkens back to both the Economic Development Council as well as the World Trade Center activities. And really from an international standpoint, the Greater Houston partnership is really the the region's front door for international investment and trade, and work in connection with the city and other entities throughout the region that undertake pieces of that both from the transportation side airports, ports, a movement of goods and services, all of those things, exporting would would fall under a network of entities. But we really are the largest business organization. And so we have access to all of those entities within our region.

Tom:

Very cool. Very cool. So just kind of curious, like is a lot of the day to day like working with companies that are like looking to move into Houston or existing companies that are in that I'd love yeah.

Susan:

Yeah, my favorite question. We talk a lot about economic development. It's a multi faceted, a scope of work, as you can imagine. But we really look at new business recruitment. And we look at that globally. And I want to spend a little time to talk about global in just a moment. But we really are do global outreach, we do new business recruitment, we also work extensively with our regional businesses on the ground, focusing especially on our members, obviously, but really are working on behalf of the entire business community. And so entities could say business retention, and perhaps expansion opportunities there.

And then from the startup ecosystem, economic gardening, whatever it is term that you'd like to say new business starts, we look at small and medium sized enterprises, and we have a strategy and economic development that really embraces six target industry sectors. And so when we are looking at the startup world, we're focusing a good bit on these target sectors and what they're going to bring to our regional economy in the forms of diversification of that they're heavily laden into, or heavily weighted into next generation technologies that we believe will bring great opportunity to these incredible existing ecosystems of business clusters that we have here in Houston that we are so fortunate to have and have had for generations oftentimes. And so looking at that innovation play, they're very closely aligned with where we see the future of Houston growing and that's a whole area that I want to talk about, but innovation and technology and how fast it's growing and all of our interest and results to date in that area.

Tom:

Very cool. I know traditionally, having thought about the economy in Houston, I think a lot of people probably think of energy, think of gas, thinking of oil, but like over the last, I don't know, decade or so, or maybe even longer, it's been really diversifying. Do you mind speaking to a little bit in the way maybe specific industries? And if there's any specific companies in the ways that people should think about the overarching economy in Houston?

Susan:

Yeah, I'll give you some quick facts as we set this up. So we are the fourth largest US city right Houston is is quite a large city, our Metro population again, those nine counties actually make up the Metropolitan Statistical Area. Our organization oversees 12, because three other counties asked to be part of our territory. But our numbers and figures typically evolve around those nine counties, which is the official MSA there's a population now of 7.1 million people. And so again, this is quite a huge region. We again have about 3 million jobs within this region and that's up about 15% from 2010 to 2020.

I'll speak to COVID and a little bit more in a few minutes. But again, that's that's kind of where we are today. We were really the fastest growing Metro by rate of population growth among the 10 most populous us metros from 2010 to 2018 we talk about constantly as again what I mentioned to you on this international piece Greater Houston or Houston is America's most diverse city and one in four Houstonians are foreign born, we speak 145 languages, here we have a third of our population growth is made up of immigrants from 2010 to 2019. We truly are a diverse and international city. And you see it exemplified in absolutely everything we do and who we are, food culture celebrations, we have 90 roughly 85 to 90 foreign consulates here. That's the third largest consular core in the United States, we have not one but two international airports. And we're one of only just a few cities that have two international airports.

And then we really have this talent base in our institutions of higher education. And again, just our international flavor goes through all of these different things.

So I say all of that to kind of set up who we are, as far as our industry sectors, I'll say a quick minute about talent, we call it the currency of economic development, your talent base is really the strength of what you're able to undertake. And that's, I always highlight that because it's really the underpinning of what we have here. But we have 360,000 educated millennials here, we have the youngest major Metro and median age about 34.6. There are 235,000 people employed in the technology sector, and 700,000 or so corporate professionals. When you get down to the base of our educational system, we really got 40 institutions of higher education in this broad region.

Tom:

Wow. Yeah.

Susan:

20 of those are two year and 20 of those are four year, but they collectively enroll about 444,000 students. So when I say we're a young region, we really are a young region, and we have three tier one universities here, Rice, University of Houston, and Texas a&m, also, affiliates with Houston it's sees itself as part of our region. And it's building more and more infrastructure directly in the city, while a campus major campus is about 80 miles from Houston, maybe from downtown, I guess.

Again, the industry sectors really have mirrored what we talk about a lot in our target sectors. And so traditional energy, you know, you mentioned immediately people that we are the energy capital of the world, undoubtedly, that is something that we're incredibly proud of. But we are also now even diversifying that base into what's the energy 2.0. Back to that technology I spoke about, you really have now this growing cluster of energy renewables clean tech, tech, digital technology that will fuel energy for its next iteration in many ways. But we see it as a whole continuum. We're not giving up that traditional energy, the world is not giving that up. We know that we're seeing diversification and how they deliver and what they're delivering. We're seeing added things on carbon capture, hydrogen, solar, wind, you name it, and then this digitization of energy and all components of this, we're really seeing a lot of our companies undertake those efforts. You know, there were research and development organizations for energy tucked into all of our major companies in different places.

What we tried to do with our technology play, bring them out. And we found a four mile corridor that goes through the middle of Houston called the innovation corridor. And we have our major energy companies all taking part in a common building, I call it called the Ion. It's in the middle of that it's called the district innovation district 16 acres right in the middle of the four miles, the four miles all being connected by a metro train. So you can hop on and off that connects the Texas Medical Center, Rice University, some of the university's research and development that Ion this building that they're putting 100 million dollars into, it will be finished the end of first quarter, it will be a place where all of the innovation efforts come together and connect in ways that will then bring this entire region together.

I'm talking NASA talking about the Medical Center. I'm talking about fortune 500 headquarters and research divisions for major energy companies, startup development organizations, you name it, this is the hub of innovation so that people can easily get it when they drop in to Greater Houston, there's a place for them to figure it out.

Tom:

It's fantastic. I mean, so much to unpack there. I think, you know, I I love your point about kind of the nucleus that it all is these education centers and being such a young, educated population, just really great tailwinds. And a perfect transition to my next line of questions related to Houston, you talked about it makes me think of the Raleigh Research Triangle, talking about the different pockets within Houston, so I think that's a great place to start this super tech forward kind of almost think tank, a little mini city. When you think about Houston and the different pockets and regions, how would you categorize other parts? Or suburbs or little towns within it? It could be more kind of older industry, more workforce housing, more technology, more education? or How would you describe some of the different pockets within Houston?

Susan:

Oh, well, there's so many, but I think some that many will recognize The Woodlands, you know, the northern part of our region, having a lot of headquarters and offices, as well as our downtown having those as well. But you've seen The Woodlands have some infrastructure there, some of our energy companies, major energy companies with campuses up there as well, you see the west side, what we call the energy corridor, and you see, energy companies of all types have been down some of the western side of Greater Houston, you see, kind of South Park, between Houston and Galveston I 45. You'll see obviously, NASA and some of the major parts of the infrastructure there. And the communities there that surrounded have been a big, big part of that. There's talent all up and down that area, right? Obviously Galveston and the coast and the coastal area, and the many assets that they bring to the region, I think they're really vast.

And then it's interesting, we look at the Texas Medical Center, which is again, in the kind of center focus, as I just mentioned, of this four mile innovation corridor, but people live again, in all of these communities that surround these areas. So there's multiple pockets of medical companies in different parts of the city. And I think one of the things we recognize is that we need to and I say us, we're working to really better articulate all the different pieces of this vast region. I think that's a piece of work we have to do. And you will see us do more and more in 2021. Because Houston is again, there's a lot of interest. And there's a lot of discussion ongoing now. And I think having that ability to articulate what you're asking which businesses in which part of town but then again, how that clear four mile area can bring together people as they they need to find some common kind of source of the innovation and the next iteration of our industry.

And again, when I say our industry, those six target sectors are big and broad, I say and they are aerospace and aviation commercial. We have been the home of Johnson Space Center. And we have this incredible one of the largest engineering talent bases in the country. And that's due in no small part to them, as well as our energy sector. But you'll see aerospace and aviation, you'll see the life science and the Industry and Energy 2.0 as I spoke about. Digital Tech has actually been a sector as we've been fortunate over the last 24 months to bring in, you know, Google office and Microsoft in a big way. And AWS is here now and those those folks weren't all here and 24 months ago, you know, these are, these are activities that are really coming to play now. So digital Tech has been an area headquarters. And we are seeing even a lot of us headquarters of international based companies really want to put their us office in Houston. And for obvious reasons, we're so international already there such connectivity, that makes perfect sense. So we see a lot of that.

And then advanced manufacturing. And this is one of the biggest manufacturing bases in the country, if not the world, and really that port, and all of the activity that is generated here, exporting and manufacturing, it's just, it's a huge part of who we are. We make things here make things and we, we like doing that. And we've got the talent to do it. They do it well.

Tom:

Love it. Love it. You had alluded to it a little bit about airports. Let's talk a little bit more about just kind of general transportation within Houston, anything related to, you know, touch on the airports? Is there any type of kind of like light rail? Or how do people get around in Houston?

Susan:

Yeah, it's still I think, you know, by car, we have Metro, and we do have a four mile train track, there's been some initiatives to expand that, obviously. And so some work will be done in those areas. And you'll see a lot of those initiatives kind of guarding the region as we work on that being such a big area. Now, of course, you're seeing some trends about post COVID, you know, people working in and out, but I think we're still committed, you know, obviously, looking at all the trends and watching that. But that innovation corridor, again, bringing people to some common spots will continue to start, you know, continuing our electronic work as we've been doing so successfully, actually. I'm a little bit surprised about that.

Tom:

That's a great natural transition. I mean, obviously, with like restaurants and stuff, it's probably very difficult with COVID. But generally speaking, how do you think the economic climate in Houston as has been weathering the storm thus far?

Susan:

Yeah, well, I can speak to it from a couple of places, and I'll pull out a little data for you. But you know, there's, obviously we've had some job loss. And back to what you were saying there's a natural group of small businesses that have been hurt. In addition to that, we were already seeing a little downclimb in energy. And so there was, there was some job shed shedding going on a COVID amplified a lot of that. And so it really accelerated some trends. But we lost, you know, in that immediate COVID moment, what in March, we saw probably 350,000 jobs lost. But we've already brought back about 150 of those. But net net, we're still working on about 200,000 jobs, and continuing to see each month some different pieces of that. And so we will finish the year, again, we think about 200,000 jobs that were down, it's about 4.2%, fewer than we started with that compares with about a 5.1% loss for the nation, and about a 4.1% loss for the state. So we're kind of in the middle there, we predict we're using some predictions from the periban group and they project next year will probably gain about 77,000 jobs about a two and a half percent job growth. And the US job growth is forecast about 2.6 or about 33 point 7 million jobs and Texas job growth predicted again by pyramid at about a two and a half percent increase in Texas.

So you know, I think we're kind of in the middle of that pack. That does tell us that we have further and diversified that economy because we remember and many Texans and Houstonians remember oil ups and downs over the years, it in years past it would be a much even deeper situation. And so I think that has shown us that we've diversified some we need to diversify more. And I would say again, not because we're shying away from our industry, but because we have such deep assets to grow these sectors and so much to give I think from an output side, it's such a rich place to do things like life sciences and and other types of manufacturing. And really looking at all of these pieces.

Houston's just quite fortunate to have the asset base that it has the students international peace, all of it. So so we're very committed to that. If you want to get into month by month, we can go into that.

Tom:

Let’s do it!

Susan:

So in September, we added about 24,000 jobs. And again, that just brought the recovered jobs from April to about 142,600. Since COVID. began right since April, the deep cuts in March and April that we saw immediately. And so but again, we're still about 200,000 jobs short of where we were pre March, April, initial COVID moments I called them, but that put us you know, just shy of 3 million jobs back to what I said so So again, we had 3.2 million, probably this time last year or back in February even so that's the Delta that we're working from>

We'll see how 21 goes, I feel like we're well positioned. But we have to do our work just like everyone, right? This is a day to day economic development. And I have a team of 15 people right now and soon to be 17. And we get up every day. And we think about this. And we lead a team of regional chambers and organizations, probably in the smaller regions that surround us, we probably have 55 to 60, economic development specialists and executives, we live about 40 different organizations, and we meet monthly, we are connected, we are talking and working as closely in unison as we can. And I think that's the great part of our strength, right, we all are kind of getting very closely aligned and seeing what we need to do and what we want to do and how those two things kind of come together creating jobs and creating that future economy we all want to see.

Tom:

It's great. And plus two on the job count just within your own org itself saying going from 15 to 17. I'm curious within the data that you have this is more just personal interest. Do you guys have like go granular with the growth in seeing what sectors the growth or recovering faster?

Susan:

Yeah, I can try on September's and then I can pull all the different. So September gains, just using that as an example were concentrated in a couple of different sectors. Many of them they believe were tied to the students returning from summer break. So remember the timeframe we were talking about? So local education, school districts had about plus 19,000 jobs. Okay, so they're coming back online, right restaurants and bars at about 5,800 increased, right? state education, colleges and universities had about 4800 education services, select private schools, Test Prep tutoring, that was another 3,200. And then there were fabricated metal product manufacturing, which showed a gain of about 2,300. We were kind of looking at that when trying to kind of put that into context. And it may have just been considering drilling activity had decreased. You know, we were just trying to see is that when could that be, you know what it could be tied to and we didn't really know now, there were losses in other places that we had to look at. So but we typify as other services, we have about 5,400 jobs that were lost in other so just across an array, health care and social assistance were about 3,400, down financial lost about 2400 hosts wholesale trade about 2,200. And then arts and recreation about 1,700. Again, looking at probably effects of what we were still seeing and you know, different timing on monies that were coming down from shoring up, some of the businesses could have potentially affected these.

But you know, all the gains again, and all the plus and minus we're, you know, just shy of 3 million jobs. So for the region, you know.

Tom:

Got a couple more questions. Well, while I have you today, I'd love for you to speak to sort of the culture of Houston. What makes Houston Houston as far as I don't know, just thinking about culture, wise things to do all that good stuff. And I bet it's extra fun being such a melting pot.

Susan:

It really is. I have to say Houston is if people can think of one thing it is truly global. And that just gives it this kind of sophisticated, but very multi dimensional culture, right? We love food we love all kinds of, and we have some of the best in the world, right? Because all of these people live here. So it's I think we quantified our restaurants, right? So 10,600 restaurants, 650 bars, but here's the kicker they represent 70 different countries cuisine. So dining is a part of everything that we do. We're among the country's most visited and diverse cultural centers for the Houston museum department. I don't know how many people know the incredible art and and all of the different museums. Millions of dollars have just been even added to that again, we have world renowned Performing Arts in theater, dance, music, ballet, and we love that right? It's a really coveted part of what we do. And you know, we are a major league sports town. This is Houston. And so you know, all of our sports teams, from soccer, to basketball to football, baseball, we're in it all the way and you know, these are some ardent fans and so all the franchises are very important to us here.

And then I think what people don't know and this is probably the most misunderstood thing about Houston and again, you're going to see see and hear a whole lot more about this in 2021 but we are among the country's greenest cities and people would go Houston? You know we don't think of Houston like that. But they have been quietly putting in this infrastructure over the past probably decade. I've hundred miles of bikeways here 580 parks developed parks here and 170 open spaces. I would say our largest Park is called Memorial Park. It is twice the size of Central Park in New York, and they have just put millions of dollars into new green space the golf course. It'll be one of the most incredible public golf courses in the nation. Botanical Gardens, you name it, it's all there. So people are outdoorsy, sports minded, and they're International. And they just that's what makes Houston Houston I think.

Tom:

I was in I was in Houston last year for a wedding up in the woodlands or like Lake conroe. And I was blown away just somehow it kind of beautiful and green and lovely as I highly recommend it. So this leads to a good good visiting Houston question. This will be my last one, then I'll let you cover anything else that we we may have failed to touch on. All right. So you get two meals in Houston. One of them is your fancy meal. You're getting dressed up and your other one is Oh, man, I need something kind of greasy kind of built, you know, yummy like that. So all right. What's your fancy meal? At what restaurant you getting it at? And then what's your down home meal?

Susan:

There are literally too many. I will tell you chefs, we've worked a lot. And you'll different restaurants. But you probably know Chris shepherd.

Tom:

Yeah. name drop away.

Susan:

Yeah. Yeah. So from his kind of notoriety as a chef, obviously, and many others, the restaurant scene is highly acclaimed. And so literally, they really have such a diverse group that I try a different one all the time. Like, it's just interesting to me. And unfortunately for me, I've never not enjoy. Like, and I do go back. That's just the kind of place it is. But you can really find every kind of food and it's just it's incredible. Yeah.

Tom:

Any shoutouts for a hole in the wall. Not the famous chef. Oh, man, I need something to fill me up. Any thoughts?

Susan:

Oh, wow. It depends on like..

Tom:

Tacos. Whatever you like.

Susan:

Oh, no, that's that's always good. There's really a million that are fantastic. And then we've got some chefs that are true interior Mexican food. There's just really good ones. But you can find some awfully good tacos here. Breakfast tacos, lunch, dinner, you name it there. They're all fantastic.

Tom:

All right. Any final thoughts on Houston's want to share with the audience? Before we close out today?

Susan:

I think we've realized here the Greater Houston partnership, the incredible trajectory that the development of the innovation ecosystem has been on. And again, it was developed as part of our strategic direction several years ago, and intended to diversify the economy. But most importantly, feed the economy. And again, those sectors that have been here, there was a reason to make sure that they had the talent and the capabilities from a technology standpoint to move into the next generation. And we're always looking ahead right positioning this city. And so I think how much Houston has changed would surprise people. I don't think we've lost any of the great assets that made the city what it was. I moved here in the 90s and was gone for many years to grad school and to other places and hits. I've been back 24 months, and it's just an incredible city even more so than when I was here before I think and I really encourage people to look at it and see the differentiations in how it's progressed forward. And that's incumbent on us to get that message out. You're gonna hear it loud and clear in 2021 with a new brand and image to match who the city is now.

Tom:

Love it. Susan, thank you so much for taking the time to join us.

Susan:

Sure. My pleasure. Thanks for having me.

Tom:

Susan, thank you so much again for jumping on and thank you everybody for listening to the Remote Real Estate Investor. If you enjoyed this episode, enjoyed the podcast, people we’d love it if you would subscribe and give us a review. All right. Happy investing.

In this episode, Tom Speaks with Susan Davenport, the Chief Economic Officer for the Greater Houston Partnership, about the economic, educational and cultural aspects of the City of Houston.  

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Transcription

Tom:

Greetings, and welcome to The Remote Real Estate Investor. On today's episode, we have Susan Davenport, who is the Chief Economic Officer for the Greater Houston Partnership. And on this episode, we're going to deep dive into Houston, talk about points of interest, talk about the economy, and all that good stuff. All right, let's do it.

Theme Song

Tom:

Before we get going and talking about Houston, Susan, why don't you tell us a little bit about yourself, as well as the Greater Houston partnership?

Susan:

Yeah, wonderful. Well, thank you again, Tom, for having me this afternoon. Again, my name is Susan Davenport. I'm the chief Economic Development Officer for the Greater Houston Partnership. And we are the region's lead business organization. We serve a 12 County Greater Houston region that represents our membership base represents more than 1000 businesses and institutions throughout Greater Houston in that regional effort. Our members, the member companies that are part of our organization account for about one fifth of Houston's workforce.

So we have many large corporations as well as small and medium sized enterprises as well. So we have three areas of focus. One is to promote economic development and trade. The second is to advocate for effective public policy. And then the third is that we convene regional businesses and Houstonians on key issues affecting our region. Now, the Greater Houston partnership is an organization that has its roots and founding actually from 1840. We were the Houston Chamber of Commerce, was founded again in 1840. And then in 1989, there was a merger with what was founded following the Chamber's initiation in 1840, there was the World Trade Center of Houston and international leadership entity in regard to international business and trade, and then the Economic Development Council of Houston.

And so all three of those entities in 1989, joined under one umbrella organization, the Greater Houston partnership, and that's very indicative of the type of activity you see within our organization, again, having about 1000 member businesses and institutions that speaks to our chamber side, right. And our chamber roots, my team, which does economic development, and international investment and trade that harkens back to both the Economic Development Council as well as the World Trade Center activities. And really from an international standpoint, the Greater Houston partnership is really the the region's front door for international investment and trade, and work in connection with the city and other entities throughout the region that undertake pieces of that both from the transportation side airports, ports, a movement of goods and services, all of those things, exporting would would fall under a network of entities. But we really are the largest business organization. And so we have access to all of those entities within our region.

Tom:

Very cool. Very cool. So just kind of curious, like is a lot of the day to day like working with companies that are like looking to move into Houston or existing companies that are in that I'd love yeah.

Susan:

Yeah, my favorite question. We talk a lot about economic development. It's a multi faceted, a scope of work, as you can imagine. But we really look at new business recruitment. And we look at that globally. And I want to spend a little time to talk about global in just a moment. But we really are do global outreach, we do new business recruitment, we also work extensively with our regional businesses on the ground, focusing especially on our members, obviously, but really are working on behalf of the entire business community. And so entities could say business retention, and perhaps expansion opportunities there.

And then from the startup ecosystem, economic gardening, whatever it is term that you'd like to say new business starts, we look at small and medium sized enterprises, and we have a strategy and economic development that really embraces six target industry sectors. And so when we are looking at the startup world, we're focusing a good bit on these target sectors and what they're going to bring to our regional economy in the forms of diversification of that they're heavily laden into, or heavily weighted into next generation technologies that we believe will bring great opportunity to these incredible existing ecosystems of business clusters that we have here in Houston that we are so fortunate to have and have had for generations oftentimes. And so looking at that innovation play, they're very closely aligned with where we see the future of Houston growing and that's a whole area that I want to talk about, but innovation and technology and how fast it's growing and all of our interest and results to date in that area.

Tom:

Very cool. I know traditionally, having thought about the economy in Houston, I think a lot of people probably think of energy, think of gas, thinking of oil, but like over the last, I don't know, decade or so, or maybe even longer, it's been really diversifying. Do you mind speaking to a little bit in the way maybe specific industries? And if there's any specific companies in the ways that people should think about the overarching economy in Houston?

Susan:

Yeah, I'll give you some quick facts as we set this up. So we are the fourth largest US city right Houston is is quite a large city, our Metro population again, those nine counties actually make up the Metropolitan Statistical Area. Our organization oversees 12, because three other counties asked to be part of our territory. But our numbers and figures typically evolve around those nine counties, which is the official MSA there's a population now of 7.1 million people. And so again, this is quite a huge region. We again have about 3 million jobs within this region and that's up about 15% from 2010 to 2020.

I'll speak to COVID and a little bit more in a few minutes. But again, that's that's kind of where we are today. We were really the fastest growing Metro by rate of population growth among the 10 most populous us metros from 2010 to 2018 we talk about constantly as again what I mentioned to you on this international piece Greater Houston or Houston is America's most diverse city and one in four Houstonians are foreign born, we speak 145 languages, here we have a third of our population growth is made up of immigrants from 2010 to 2019. We truly are a diverse and international city. And you see it exemplified in absolutely everything we do and who we are, food culture celebrations, we have 90 roughly 85 to 90 foreign consulates here. That's the third largest consular core in the United States, we have not one but two international airports. And we're one of only just a few cities that have two international airports.

And then we really have this talent base in our institutions of higher education. And again, just our international flavor goes through all of these different things.

So I say all of that to kind of set up who we are, as far as our industry sectors, I'll say a quick minute about talent, we call it the currency of economic development, your talent base is really the strength of what you're able to undertake. And that's, I always highlight that because it's really the underpinning of what we have here. But we have 360,000 educated millennials here, we have the youngest major Metro and median age about 34.6. There are 235,000 people employed in the technology sector, and 700,000 or so corporate professionals. When you get down to the base of our educational system, we really got 40 institutions of higher education in this broad region.

Tom:

Wow. Yeah.

Susan:

20 of those are two year and 20 of those are four year, but they collectively enroll about 444,000 students. So when I say we're a young region, we really are a young region, and we have three tier one universities here, Rice, University of Houston, and Texas a&m, also, affiliates with Houston it's sees itself as part of our region. And it's building more and more infrastructure directly in the city, while a campus major campus is about 80 miles from Houston, maybe from downtown, I guess.

Again, the industry sectors really have mirrored what we talk about a lot in our target sectors. And so traditional energy, you know, you mentioned immediately people that we are the energy capital of the world, undoubtedly, that is something that we're incredibly proud of. But we are also now even diversifying that base into what's the energy 2.0. Back to that technology I spoke about, you really have now this growing cluster of energy renewables clean tech, tech, digital technology that will fuel energy for its next iteration in many ways. But we see it as a whole continuum. We're not giving up that traditional energy, the world is not giving that up. We know that we're seeing diversification and how they deliver and what they're delivering. We're seeing added things on carbon capture, hydrogen, solar, wind, you name it, and then this digitization of energy and all components of this, we're really seeing a lot of our companies undertake those efforts. You know, there were research and development organizations for energy tucked into all of our major companies in different places.

What we tried to do with our technology play, bring them out. And we found a four mile corridor that goes through the middle of Houston called the innovation corridor. And we have our major energy companies all taking part in a common building, I call it called the Ion. It's in the middle of that it's called the district innovation district 16 acres right in the middle of the four miles, the four miles all being connected by a metro train. So you can hop on and off that connects the Texas Medical Center, Rice University, some of the university's research and development that Ion this building that they're putting 100 million dollars into, it will be finished the end of first quarter, it will be a place where all of the innovation efforts come together and connect in ways that will then bring this entire region together.

I'm talking NASA talking about the Medical Center. I'm talking about fortune 500 headquarters and research divisions for major energy companies, startup development organizations, you name it, this is the hub of innovation so that people can easily get it when they drop in to Greater Houston, there's a place for them to figure it out.

Tom:

It's fantastic. I mean, so much to unpack there. I think, you know, I I love your point about kind of the nucleus that it all is these education centers and being such a young, educated population, just really great tailwinds. And a perfect transition to my next line of questions related to Houston, you talked about it makes me think of the Raleigh Research Triangle, talking about the different pockets within Houston, so I think that's a great place to start this super tech forward kind of almost think tank, a little mini city. When you think about Houston and the different pockets and regions, how would you categorize other parts? Or suburbs or little towns within it? It could be more kind of older industry, more workforce housing, more technology, more education? or How would you describe some of the different pockets within Houston?

Susan:

Oh, well, there's so many, but I think some that many will recognize The Woodlands, you know, the northern part of our region, having a lot of headquarters and offices, as well as our downtown having those as well. But you've seen The Woodlands have some infrastructure there, some of our energy companies, major energy companies with campuses up there as well, you see the west side, what we call the energy corridor, and you see, energy companies of all types have been down some of the western side of Greater Houston, you see, kind of South Park, between Houston and Galveston I 45. You'll see obviously, NASA and some of the major parts of the infrastructure there. And the communities there that surrounded have been a big, big part of that. There's talent all up and down that area, right? Obviously Galveston and the coast and the coastal area, and the many assets that they bring to the region, I think they're really vast.

And then it's interesting, we look at the Texas Medical Center, which is again, in the kind of center focus, as I just mentioned, of this four mile innovation corridor, but people live again, in all of these communities that surround these areas. So there's multiple pockets of medical companies in different parts of the city. And I think one of the things we recognize is that we need to and I say us, we're working to really better articulate all the different pieces of this vast region. I think that's a piece of work we have to do. And you will see us do more and more in 2021. Because Houston is again, there's a lot of interest. And there's a lot of discussion ongoing now. And I think having that ability to articulate what you're asking which businesses in which part of town but then again, how that clear four mile area can bring together people as they they need to find some common kind of source of the innovation and the next iteration of our industry.

And again, when I say our industry, those six target sectors are big and broad, I say and they are aerospace and aviation commercial. We have been the home of Johnson Space Center. And we have this incredible one of the largest engineering talent bases in the country. And that's due in no small part to them, as well as our energy sector. But you'll see aerospace and aviation, you'll see the life science and the Industry and Energy 2.0 as I spoke about. Digital Tech has actually been a sector as we've been fortunate over the last 24 months to bring in, you know, Google office and Microsoft in a big way. And AWS is here now and those those folks weren't all here and 24 months ago, you know, these are, these are activities that are really coming to play now. So digital Tech has been an area headquarters. And we are seeing even a lot of us headquarters of international based companies really want to put their us office in Houston. And for obvious reasons, we're so international already there such connectivity, that makes perfect sense. So we see a lot of that.

And then advanced manufacturing. And this is one of the biggest manufacturing bases in the country, if not the world, and really that port, and all of the activity that is generated here, exporting and manufacturing, it's just, it's a huge part of who we are. We make things here make things and we, we like doing that. And we've got the talent to do it. They do it well.

Tom:

Love it. Love it. You had alluded to it a little bit about airports. Let's talk a little bit more about just kind of general transportation within Houston, anything related to, you know, touch on the airports? Is there any type of kind of like light rail? Or how do people get around in Houston?

Susan:

Yeah, it's still I think, you know, by car, we have Metro, and we do have a four mile train track, there's been some initiatives to expand that, obviously. And so some work will be done in those areas. And you'll see a lot of those initiatives kind of guarding the region as we work on that being such a big area. Now, of course, you're seeing some trends about post COVID, you know, people working in and out, but I think we're still committed, you know, obviously, looking at all the trends and watching that. But that innovation corridor, again, bringing people to some common spots will continue to start, you know, continuing our electronic work as we've been doing so successfully, actually. I'm a little bit surprised about that.

Tom:

That's a great natural transition. I mean, obviously, with like restaurants and stuff, it's probably very difficult with COVID. But generally speaking, how do you think the economic climate in Houston as has been weathering the storm thus far?

Susan:

Yeah, well, I can speak to it from a couple of places, and I'll pull out a little data for you. But you know, there's, obviously we've had some job loss. And back to what you were saying there's a natural group of small businesses that have been hurt. In addition to that, we were already seeing a little downclimb in energy. And so there was, there was some job shed shedding going on a COVID amplified a lot of that. And so it really accelerated some trends. But we lost, you know, in that immediate COVID moment, what in March, we saw probably 350,000 jobs lost. But we've already brought back about 150 of those. But net net, we're still working on about 200,000 jobs, and continuing to see each month some different pieces of that. And so we will finish the year, again, we think about 200,000 jobs that were down, it's about 4.2%, fewer than we started with that compares with about a 5.1% loss for the nation, and about a 4.1% loss for the state. So we're kind of in the middle there, we predict we're using some predictions from the periban group and they project next year will probably gain about 77,000 jobs about a two and a half percent job growth. And the US job growth is forecast about 2.6 or about 33 point 7 million jobs and Texas job growth predicted again by pyramid at about a two and a half percent increase in Texas.

So you know, I think we're kind of in the middle of that pack. That does tell us that we have further and diversified that economy because we remember and many Texans and Houstonians remember oil ups and downs over the years, it in years past it would be a much even deeper situation. And so I think that has shown us that we've diversified some we need to diversify more. And I would say again, not because we're shying away from our industry, but because we have such deep assets to grow these sectors and so much to give I think from an output side, it's such a rich place to do things like life sciences and and other types of manufacturing. And really looking at all of these pieces.

Houston's just quite fortunate to have the asset base that it has the students international peace, all of it. So so we're very committed to that. If you want to get into month by month, we can go into that.

Tom:

Let’s do it!

Susan:

So in September, we added about 24,000 jobs. And again, that just brought the recovered jobs from April to about 142,600. Since COVID. began right since April, the deep cuts in March and April that we saw immediately. And so but again, we're still about 200,000 jobs short of where we were pre March, April, initial COVID moments I called them, but that put us you know, just shy of 3 million jobs back to what I said so So again, we had 3.2 million, probably this time last year or back in February even so that's the Delta that we're working from>

We'll see how 21 goes, I feel like we're well positioned. But we have to do our work just like everyone, right? This is a day to day economic development. And I have a team of 15 people right now and soon to be 17. And we get up every day. And we think about this. And we lead a team of regional chambers and organizations, probably in the smaller regions that surround us, we probably have 55 to 60, economic development specialists and executives, we live about 40 different organizations, and we meet monthly, we are connected, we are talking and working as closely in unison as we can. And I think that's the great part of our strength, right, we all are kind of getting very closely aligned and seeing what we need to do and what we want to do and how those two things kind of come together creating jobs and creating that future economy we all want to see.

Tom:

It's great. And plus two on the job count just within your own org itself saying going from 15 to 17. I'm curious within the data that you have this is more just personal interest. Do you guys have like go granular with the growth in seeing what sectors the growth or recovering faster?

Susan:

Yeah, I can try on September's and then I can pull all the different. So September gains, just using that as an example were concentrated in a couple of different sectors. Many of them they believe were tied to the students returning from summer break. So remember the timeframe we were talking about? So local education, school districts had about plus 19,000 jobs. Okay, so they're coming back online, right restaurants and bars at about 5,800 increased, right? state education, colleges and universities had about 4800 education services, select private schools, Test Prep tutoring, that was another 3,200. And then there were fabricated metal product manufacturing, which showed a gain of about 2,300. We were kind of looking at that when trying to kind of put that into context. And it may have just been considering drilling activity had decreased. You know, we were just trying to see is that when could that be, you know what it could be tied to and we didn't really know now, there were losses in other places that we had to look at. So but we typify as other services, we have about 5,400 jobs that were lost in other so just across an array, health care and social assistance were about 3,400, down financial lost about 2400 hosts wholesale trade about 2,200. And then arts and recreation about 1,700. Again, looking at probably effects of what we were still seeing and you know, different timing on monies that were coming down from shoring up, some of the businesses could have potentially affected these.

But you know, all the gains again, and all the plus and minus we're, you know, just shy of 3 million jobs. So for the region, you know.

Tom:

Got a couple more questions. Well, while I have you today, I'd love for you to speak to sort of the culture of Houston. What makes Houston Houston as far as I don't know, just thinking about culture, wise things to do all that good stuff. And I bet it's extra fun being such a melting pot.

Susan:

It really is. I have to say Houston is if people can think of one thing it is truly global. And that just gives it this kind of sophisticated, but very multi dimensional culture, right? We love food we love all kinds of, and we have some of the best in the world, right? Because all of these people live here. So it's I think we quantified our restaurants, right? So 10,600 restaurants, 650 bars, but here's the kicker they represent 70 different countries cuisine. So dining is a part of everything that we do. We're among the country's most visited and diverse cultural centers for the Houston museum department. I don't know how many people know the incredible art and and all of the different museums. Millions of dollars have just been even added to that again, we have world renowned Performing Arts in theater, dance, music, ballet, and we love that right? It's a really coveted part of what we do. And you know, we are a major league sports town. This is Houston. And so you know, all of our sports teams, from soccer, to basketball to football, baseball, we're in it all the way and you know, these are some ardent fans and so all the franchises are very important to us here.

And then I think what people don't know and this is probably the most misunderstood thing about Houston and again, you're going to see see and hear a whole lot more about this in 2021 but we are among the country's greenest cities and people would go Houston? You know we don't think of Houston like that. But they have been quietly putting in this infrastructure over the past probably decade. I've hundred miles of bikeways here 580 parks developed parks here and 170 open spaces. I would say our largest Park is called Memorial Park. It is twice the size of Central Park in New York, and they have just put millions of dollars into new green space the golf course. It'll be one of the most incredible public golf courses in the nation. Botanical Gardens, you name it, it's all there. So people are outdoorsy, sports minded, and they're International. And they just that's what makes Houston Houston I think.

Tom:

I was in I was in Houston last year for a wedding up in the woodlands or like Lake conroe. And I was blown away just somehow it kind of beautiful and green and lovely as I highly recommend it. So this leads to a good good visiting Houston question. This will be my last one, then I'll let you cover anything else that we we may have failed to touch on. All right. So you get two meals in Houston. One of them is your fancy meal. You're getting dressed up and your other one is Oh, man, I need something kind of greasy kind of built, you know, yummy like that. So all right. What's your fancy meal? At what restaurant you getting it at? And then what's your down home meal?

Susan:

There are literally too many. I will tell you chefs, we've worked a lot. And you'll different restaurants. But you probably know Chris shepherd.

Tom:

Yeah. name drop away.

Susan:

Yeah. Yeah. So from his kind of notoriety as a chef, obviously, and many others, the restaurant scene is highly acclaimed. And so literally, they really have such a diverse group that I try a different one all the time. Like, it's just interesting to me. And unfortunately for me, I've never not enjoy. Like, and I do go back. That's just the kind of place it is. But you can really find every kind of food and it's just it's incredible. Yeah.

Tom:

Any shoutouts for a hole in the wall. Not the famous chef. Oh, man, I need something to fill me up. Any thoughts?

Susan:

Oh, wow. It depends on like..

Tom:

Tacos. Whatever you like.

Susan:

Oh, no, that's that's always good. There's really a million that are fantastic. And then we've got some chefs that are true interior Mexican food. There's just really good ones. But you can find some awfully good tacos here. Breakfast tacos, lunch, dinner, you name it there. They're all fantastic.

Tom:

All right. Any final thoughts on Houston's want to share with the audience? Before we close out today?

Susan:

I think we've realized here the Greater Houston partnership, the incredible trajectory that the development of the innovation ecosystem has been on. And again, it was developed as part of our strategic direction several years ago, and intended to diversify the economy. But most importantly, feed the economy. And again, those sectors that have been here, there was a reason to make sure that they had the talent and the capabilities from a technology standpoint to move into the next generation. And we're always looking ahead right positioning this city. And so I think how much Houston has changed would surprise people. I don't think we've lost any of the great assets that made the city what it was. I moved here in the 90s and was gone for many years to grad school and to other places and hits. I've been back 24 months, and it's just an incredible city even more so than when I was here before I think and I really encourage people to look at it and see the differentiations in how it's progressed forward. And that's incumbent on us to get that message out. You're gonna hear it loud and clear in 2021 with a new brand and image to match who the city is now.

Tom:

Love it. Susan, thank you so much for taking the time to join us.

Susan:

Sure. My pleasure. Thanks for having me.

Tom:

Susan, thank you so much again for jumping on and thank you everybody for listening to the Remote Real Estate Investor. If you enjoyed this episode, enjoyed the podcast, people we’d love it if you would subscribe and give us a review. All right. Happy investing.