Carolina Capital Management holds a Panel discussion on the present investor environment.
Joining us today:
Fuquan Bilal www.NNGCapitalFund.com
Jacob Vanderslice www.VanWestPartners.com
Mike Zlotnik www.BigMikeFund.com
Glenn Stromberg www.StrombergInvestmentGroup.com
Chris Miles www.MoneyRipples.com
Carolina Capital is a hard money lender serving the needs of the “Real Estate Investor” and the "Small Builder" borrower who is striving to build wealth and generate income for themselves and their families. We offer “hard money rehab loans” and "Ground up Construction Loans" for investors only in NC, SC, GA, VA and TN (some areas of FL, as well).
As part of our business practices, we also serve as consultants for investors guiding them to network with other investors and educating them in locating and structuring transactions. Rarely, if ever, will you find a hard money lender willing to invest in your success like Carolina Capital Management.
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Okay. Here we are live. Thank you so much for joining us.
We're going to call this live segment going forward, real estate investor
market update. And what we're trying to do, it's a kind of a trying time right
now. We want to add some clarity. We want to take the fear out of what's going
on. Almost all of our guests, well, I'm assuming all of our guests have already
been through these market changes. I know I've been beat up a lot, so, and I'm
old. So it's not only do I bruise easy because of my age. Adds little bit of
wisdom and we've seen these cycles before. We believe this is going to be a
temporary. My name is Bill Fairman. I'm with Carolina Capital Management. This
is my co-host Jonathan Davis. I am currently getting a feedback in my ear. So
if I'm hesitating... What I'd like to do is introduce our guests. If all of our
guests will put themselves on mute for a moment. That will help me out.
We're going to call this live segment going forward, real estate investor
market update. And what we're trying to do, it's a kind of a trying time right
now. We want to add some clarity. We want to take the fear out of what's going
on. Almost all of our guests, well, I'm assuming all of our guests have already
been through these market changes. I know I've been beat up a lot, so, and I'm
old. So it's not only do I bruise easy because of my age. Adds little bit of
wisdom and we've seen these cycles before. We believe this is going to be a
temporary. My name is Bill Fairman. I'm with Carolina Capital Management. This
is my co-host Jonathan Davis. I am currently getting a feedback in my ear. So
if I'm hesitating... What I'd like to do is introduce our guests. If all of our
guests will put themselves on mute for a moment. That will help me out.
Not only am I old, but I'm easily confused. So we have
with us today, Mike Zlotnik. Of Tempo Funding. He's in the, Brooklyn area of
New York. He does a lot of, he does lending as well as commercial properties in
a fund. And he, he's also a mathematician by trade, so he always, he always
sounds a lot smarter than the rest of us. Now we also, we also have, Jacob
Vanderslice, he's with Van West partners. They also are in the commercial
space. I think most of that is in the self storage, not if I'm saying that
correct.
with us today, Mike Zlotnik. Of Tempo Funding. He's in the, Brooklyn area of
New York. He does a lot of, he does lending as well as commercial properties in
a fund. And he, he's also a mathematician by trade, so he always, he always
sounds a lot smarter than the rest of us. Now we also, we also have, Jacob
Vanderslice, he's with Van West partners. They also are in the commercial
space. I think most of that is in the self storage, not if I'm saying that
correct.
Okay. He says yes. We have Glenn Stromberg of Stromberg
Investment group. He is in what we like to call the Wheel Estate Space. So he
specializes in mobile homes, on land and all of those are for turnkey rental
purposes. We have Chris Miles of Money Ripples. He is the Anti-financial
Advisor and, we're going to talk about a lot of stuff from his perspective. And
we have Fuquan Bilal, which is not, he's not on yet, but I'm assuming he will
be here shortly he is with NNG Capital. So before we get started, guys, I'd
like to talk about the bill that was passed last night by the Senate.
Investment group. He is in what we like to call the Wheel Estate Space. So he
specializes in mobile homes, on land and all of those are for turnkey rental
purposes. We have Chris Miles of Money Ripples. He is the Anti-financial
Advisor and, we're going to talk about a lot of stuff from his perspective. And
we have Fuquan Bilal, which is not, he's not on yet, but I'm assuming he will
be here shortly he is with NNG Capital. So before we get started, guys, I'd
like to talk about the bill that was passed last night by the Senate.
There's a couple of little things I want to highlight in
there. If you're a small business owner and you're worried about keeping cash
flow going, this is going to help, but if you need it tomorrow, it's not going
to help.
there. If you're a small business owner and you're worried about keeping cash
flow going, this is going to help, but if you need it tomorrow, it's not going
to help.
Yeah if you need it tomorrow it's not. But if you can, you
can hold tight for two or three weeks. I think you, it will definitely be very
helpful to a lot of small business owners.
can hold tight for two or three weeks. I think you, it will definitely be very
helpful to a lot of small business owners.
By the way, before I get into this any further, I want
Jonathan's wife to realize we are more than six feet apart. It's just when
you're on camera, it makes you look a lot closer. It adds weight, but it also
makes the room look smaller.
Jonathan's wife to realize we are more than six feet apart. It's just when
you're on camera, it makes you look a lot closer. It adds weight, but it also
makes the room look smaller.
He's not really this close to me. So a couple of little
highlights from, from the bill is your local bank. If you have a bank
relationship with your local banker, that's where you need to go to get this
stimulus loan. And it's going to be for payroll, payroll taxes, health
insurance benefits that you're paying your employees, rent or mortgage
utilities, insurance payments. Yeah. I'm not sure how long for, but it's going
to be a fully guaranteed loan from the government. So it's going to be a lot
easier for the banks to underwrite these because Hey, they're going to use
their standard, underwriting practices, however, they're not going to really
hesitate not to give a loan knowing that as long as you're a qualified borrower
because the government is going to back it up. And if you, you know, don't,
and, and by the way, there's a little bit of, it's also payroll and there's a
little bit of concerned on whether it's for retention or a rehiring.
highlights from, from the bill is your local bank. If you have a bank
relationship with your local banker, that's where you need to go to get this
stimulus loan. And it's going to be for payroll, payroll taxes, health
insurance benefits that you're paying your employees, rent or mortgage
utilities, insurance payments. Yeah. I'm not sure how long for, but it's going
to be a fully guaranteed loan from the government. So it's going to be a lot
easier for the banks to underwrite these because Hey, they're going to use
their standard, underwriting practices, however, they're not going to really
hesitate not to give a loan knowing that as long as you're a qualified borrower
because the government is going to back it up. And if you, you know, don't,
and, and by the way, there's a little bit of, it's also payroll and there's a
little bit of concerned on whether it's for retention or a rehiring.
And it did say rehire and retain. Or for retain and
rehire. A lot of people are concerned there, because we can't wait for
government. A lot of us had to move, you know right away because, Hey, you had
no revenue coming in. You had people that are not, not working. What are you
going to do? You can't wait for government to make up their mind. And by the
way, it's going to be 10 days before they even get guidelines on this and they
still have, it still has to be passed by the house. So, it's going to be a
little while for you to get there. But what you need to do is make sure you
call your local banker right away. Make sure you get in line, let them know
that you want to do this and go ahead and get your normal stuff that you would
get for a loan, your tax returns, your balance sheets, all that stuff, right?
rehire. A lot of people are concerned there, because we can't wait for
government. A lot of us had to move, you know right away because, Hey, you had
no revenue coming in. You had people that are not, not working. What are you
going to do? You can't wait for government to make up their mind. And by the
way, it's going to be 10 days before they even get guidelines on this and they
still have, it still has to be passed by the house. So, it's going to be a
little while for you to get there. But what you need to do is make sure you
call your local banker right away. Make sure you get in line, let them know
that you want to do this and go ahead and get your normal stuff that you would
get for a loan, your tax returns, your balance sheets, all that stuff, right?
Yeah. Go ahead and get started. Yes. No matter what the
guidelines end up being, it's always prudent to get going.
guidelines end up being, it's always prudent to get going.
Yeah. And if you're trying to get these SBA loans that are
for disaster stuff, we, some of us heard some horror stories last night from a
dentist that was involved in a flood and it was a nightmare trying to get that
same kind of disaster, SBA stuff they ended up coming out of pocket with, with
most of it. So, okay. Call your banker. Get this all set up. Yeah. I'm going to
start off with a question to Oh yeah. Before I get there. Hey Fuquan, just
smile. So, I want to tell everyone that's watching. You can chat and ask
questions to the panelists. We'll see them and if time allows, we'll ask them
while we're on the air. If not, then we'll, we'll try to answer them offline.
So, Jacob, I'm going to start with you. What part of the commercial real estate
space do you see having the biggest issues short term, long term and why? All
right. Maybe I need to unmute you. Okay. There it is. Got it. It's okay.
for disaster stuff, we, some of us heard some horror stories last night from a
dentist that was involved in a flood and it was a nightmare trying to get that
same kind of disaster, SBA stuff they ended up coming out of pocket with, with
most of it. So, okay. Call your banker. Get this all set up. Yeah. I'm going to
start off with a question to Oh yeah. Before I get there. Hey Fuquan, just
smile. So, I want to tell everyone that's watching. You can chat and ask
questions to the panelists. We'll see them and if time allows, we'll ask them
while we're on the air. If not, then we'll, we'll try to answer them offline.
So, Jacob, I'm going to start with you. What part of the commercial real estate
space do you see having the biggest issues short term, long term and why? All
right. Maybe I need to unmute you. Okay. There it is. Got it. It's okay.
Yeah. Thanks for having us on. My name's Jake Vanderslice.
I'm a principal at the Van West Partners. We're a private equity real estate
investment company based out of Denver. We focused on a variety of asset
classes, mainly mainly self storage. We've got some retail, we do residential
as well. The fallout that we've seen so far that's been most precipitous and
most alarming is within retail and hospitality. I mean, you've got, you've got
most of America right now, especially in our geography, where retail businesses
completely shutting down. Tenants can't pay their rent. Landlords have a
problem servicing their debt. Um, we've heard of a lot of discussions on
payment deferrals with various landlords and their bankers. So retail is
definitely been a big one that we're saying. Another one that we're saying too
is hospitality. I think, before the virus really spooled up, they could see, or
commercial or hotel occupancy rather in Denver was roughly at about 5% before
they close all the hotels. Typically in March, they're tracking around 71%
occupancy, so there's a precipitous drop there. So those are really the two big
asset classes that we're concerned with. Retail and hospitality. Third, which
hasn't really manifested itself yet. We think it's going to be workforce
housing, especially, you know, C plus B minus multifamily. A lot of the tenant
base and those in those product types are hand to mouth. Retail workers, they
get 20 bucks an hour, they're bumped up with roommates and those guys losing
their jobs. So we can see a problem happening there too, but those are the
three main areas that we're, we're concerned with.
I'm a principal at the Van West Partners. We're a private equity real estate
investment company based out of Denver. We focused on a variety of asset
classes, mainly mainly self storage. We've got some retail, we do residential
as well. The fallout that we've seen so far that's been most precipitous and
most alarming is within retail and hospitality. I mean, you've got, you've got
most of America right now, especially in our geography, where retail businesses
completely shutting down. Tenants can't pay their rent. Landlords have a
problem servicing their debt. Um, we've heard of a lot of discussions on
payment deferrals with various landlords and their bankers. So retail is
definitely been a big one that we're saying. Another one that we're saying too
is hospitality. I think, before the virus really spooled up, they could see, or
commercial or hotel occupancy rather in Denver was roughly at about 5% before
they close all the hotels. Typically in March, they're tracking around 71%
occupancy, so there's a precipitous drop there. So those are really the two big
asset classes that we're concerned with. Retail and hospitality. Third, which
hasn't really manifested itself yet. We think it's going to be workforce
housing, especially, you know, C plus B minus multifamily. A lot of the tenant
base and those in those product types are hand to mouth. Retail workers, they
get 20 bucks an hour, they're bumped up with roommates and those guys losing
their jobs. So we can see a problem happening there too, but those are the
three main areas that we're, we're concerned with.
Excellent. So, Mike, let me pose the same question to you.
Sure. Mike Zlotnik, Fund Manager mutually defined me as
BigMikeFund.com. That's the name of the podcast and that's the website. I'm a
fund manager. We have a broad, diverse portfolio of assets. And the areas of
concern for sure as Jake mentioned, hospitality that is, in a deep, deep hole
and it'll continue to be there. And we're already seeing, all kinds of data,
confirming that retail, I literally just had a coal, with the shopping center
operator who does have number of shopping plazas, not the malls. And they're
waiting for the data on April 1st, most of those malls are, well, not malls,
I'm sorry, shopping centers. Our growth are anchored. So, grocery stores are
staying in business and they're likely going to continue to pay. People need to
eat even though there's a shift to delivery versus going to a store.
BigMikeFund.com. That's the name of the podcast and that's the website. I'm a
fund manager. We have a broad, diverse portfolio of assets. And the areas of
concern for sure as Jake mentioned, hospitality that is, in a deep, deep hole
and it'll continue to be there. And we're already seeing, all kinds of data,
confirming that retail, I literally just had a coal, with the shopping center
operator who does have number of shopping plazas, not the malls. And they're
waiting for the data on April 1st, most of those malls are, well, not malls,
I'm sorry, shopping centers. Our growth are anchored. So, grocery stores are
staying in business and they're likely going to continue to pay. People need to
eat even though there's a shift to delivery versus going to a store.
But shopping plazas with some of the essential businesses
probably will survive. They're certainly gonna take some level of a beating. So
that sector, again, not complete. Shopping oriented plazas are okay. Big malls
are in horrible shape for sure. The one sector that seems to be picking up, and
again, this is a contrast, someone's going down, something else going up is a
self storage. The data we were seeing is that the self storage is picking up
right now as economy is gonna hit it. It's gonna like the hit the recession,
the self storage general does pretty well. The, some office might get hit,
obviously closed. So the office that leases to brick and mortar is in difficult
times. The office space that leases to the businesses that can operate
remotely, can continue to pay rents, maybe somewhat reduced rents.
probably will survive. They're certainly gonna take some level of a beating. So
that sector, again, not complete. Shopping oriented plazas are okay. Big malls
are in horrible shape for sure. The one sector that seems to be picking up, and
again, this is a contrast, someone's going down, something else going up is a
self storage. The data we were seeing is that the self storage is picking up
right now as economy is gonna hit it. It's gonna like the hit the recession,
the self storage general does pretty well. The, some office might get hit,
obviously closed. So the office that leases to brick and mortar is in difficult
times. The office space that leases to the businesses that can operate
remotely, can continue to pay rents, maybe somewhat reduced rents.
But if it's a white collar, when the crisis passes, those
offices will continue to operate. We expect some level of demand falling for
the office space over the next, you know, few years. But in the short run,
really, the key question to ask is, what type of tenants they have in the,
whether the, it's blue collar, white collar employment. The white collar seems
to will do fine or at least not as bad. The other sector that Jake mentioned
might take some level of a correction is affordable housing. Although it's
really a function of how affordable. If most folks in those apartment complexes
are section eight and they're getting government help, unemployment, they're
probably going to continue to pay rent. There's nowhere to downgrade. So, but
the blue collar, sort of, somewhat above that there is a, it's going to be a
trench of blue collar multi-family. Those will take some level of a beating if
this is a prolonged recession and prolonged crisis. But the very low end
probably will be okay because of the government support. So...
offices will continue to operate. We expect some level of demand falling for
the office space over the next, you know, few years. But in the short run,
really, the key question to ask is, what type of tenants they have in the,
whether the, it's blue collar, white collar employment. The white collar seems
to will do fine or at least not as bad. The other sector that Jake mentioned
might take some level of a correction is affordable housing. Although it's
really a function of how affordable. If most folks in those apartment complexes
are section eight and they're getting government help, unemployment, they're
probably going to continue to pay rent. There's nowhere to downgrade. So, but
the blue collar, sort of, somewhat above that there is a, it's going to be a
trench of blue collar multi-family. Those will take some level of a beating if
this is a prolonged recession and prolonged crisis. But the very low end
probably will be okay because of the government support. So...
Thanks Mike. You know, there's going to be a shift
obviously in the market. You, if you've shifted your restaurant business to
really take out or delivery, you don't have to be in a retail place. You can
have that business in a, more of those, you know, warehouse type spaces because
you're not really gonna have that many people coming if you're delivering. So,
my next question to you two, and let's start off with Jacob. Where do you see
the properties that are going to be worth more, or the biggest positive
changes?
obviously in the market. You, if you've shifted your restaurant business to
really take out or delivery, you don't have to be in a retail place. You can
have that business in a, more of those, you know, warehouse type spaces because
you're not really gonna have that many people coming if you're delivering. So,
my next question to you two, and let's start off with Jacob. Where do you see
the properties that are going to be worth more, or the biggest positive
changes?
Yeah. Well it's easy to say because we're, we're in the
business already. But definitely self-storage is as Mike had mentioned. Within
our portfolio we track net rental activity on a daily basis and net rentals is
the difference between the number of move ins and move outs. So for example,
January 1st to 26th, we had about 18 or 20 net rentals. It was roughly the same
for this, for the time period in February. And for the month of March now
through March 26, we've seen 65 net rentals across our managed portfolio. So
part of that seasonality, but I think part of it too is maybe people are cleaning
out their homes, kind of getting ready to be strapped into their houses for
awhile. People are moving, my kids are coming back from college because they
can't be at college anymore. Filling up storage units.
business already. But definitely self-storage is as Mike had mentioned. Within
our portfolio we track net rental activity on a daily basis and net rentals is
the difference between the number of move ins and move outs. So for example,
January 1st to 26th, we had about 18 or 20 net rentals. It was roughly the same
for this, for the time period in February. And for the month of March now
through March 26, we've seen 65 net rentals across our managed portfolio. So
part of that seasonality, but I think part of it too is maybe people are cleaning
out their homes, kind of getting ready to be strapped into their houses for
awhile. People are moving, my kids are coming back from college because they
can't be at college anymore. Filling up storage units.
So we like storage as an asset class and we think it's
going gonna perform well during this downturn. And I, and I do think is afraid
of workforce housing as we are. We think that's a very defensible asset class
as well. There's always gonna be a need for workforce housing, especially as
affordability becomes more of a challenge. Wage growth is not meeting home
price appreciation. We kind of see a nationwide shift to being more of a
country of renters than a country of homeowners. And beyond that, you know, I'm
not sure where the flight to stability is right now. In general across all the
asset classes, I think investors should be focusing more on income and cash
flow, than they are a capital appreciation. I think that net woth is not going
to meet as much in the coming months or the coming year as cash flow does. And
a cash flow solves all problems. So we're trying to focus on deals that only
produce existing income streams as they are versus taking major risks on deals
that are empty with no revenue.
going gonna perform well during this downturn. And I, and I do think is afraid
of workforce housing as we are. We think that's a very defensible asset class
as well. There's always gonna be a need for workforce housing, especially as
affordability becomes more of a challenge. Wage growth is not meeting home
price appreciation. We kind of see a nationwide shift to being more of a
country of renters than a country of homeowners. And beyond that, you know, I'm
not sure where the flight to stability is right now. In general across all the
asset classes, I think investors should be focusing more on income and cash
flow, than they are a capital appreciation. I think that net woth is not going
to meet as much in the coming months or the coming year as cash flow does. And
a cash flow solves all problems. So we're trying to focus on deals that only
produce existing income streams as they are versus taking major risks on deals
that are empty with no revenue.
Right. Well, you also forgot the possibility of those
extra people hoarding their toilet paper and hand sanitizers. They need the
self storage for that.
extra people hoarding their toilet paper and hand sanitizers. They need the
self storage for that.
That's right. Exactly.
What about you Mike?
So I concur with Jake. We are very cash flow focused
today. The, you've heard me speak about the quadrants methodology. So we like
investment grade quadrants focused on cash flow or very defensive things with
downside protection. I do think that going forward, it's going to be a lot of
surgical precision looking for deals that have those characteristics. I like
what we do invested quite a bit in hard money loans and defensive, commercial
debt, low investment to value ratio. So those type of deals, with good downside
protection and an experience in strategy execution could provide significant
opportunities. Again, distress, commercial debt is counter cyclical. Just an
example, again, I'm in New York city here. Some of these, there will be
failures in the landlords will be defaulting on more and more of these loans
and that's an opportunity to scope them at a great price in the, they can take
advantage again not being a vulture but trying to salvage these types of
situations where the great SS could go at a discount and instead of buying
them, you buy the paper, the first lien mortgage that, that is a senior
position on the capital stack and foreclosed on them or work out the deal where
you, you get repaid with the good, with a good return.
today. The, you've heard me speak about the quadrants methodology. So we like
investment grade quadrants focused on cash flow or very defensive things with
downside protection. I do think that going forward, it's going to be a lot of
surgical precision looking for deals that have those characteristics. I like
what we do invested quite a bit in hard money loans and defensive, commercial
debt, low investment to value ratio. So those type of deals, with good downside
protection and an experience in strategy execution could provide significant
opportunities. Again, distress, commercial debt is counter cyclical. Just an
example, again, I'm in New York city here. Some of these, there will be
failures in the landlords will be defaulting on more and more of these loans
and that's an opportunity to scope them at a great price in the, they can take
advantage again not being a vulture but trying to salvage these types of
situations where the great SS could go at a discount and instead of buying
them, you buy the paper, the first lien mortgage that, that is a senior
position on the capital stack and foreclosed on them or work out the deal where
you, you get repaid with the good, with a good return.
Those are very defensive type of investments cause you're
in a senior position. Obviously self storage itself. The new projects, the new
origination has to, has to be very strategic in that whole business is a five
mile, three, five in one mile radius business. We do like those, we have a
number of those assets in the portfolio today. All the new stuff we're doing in
this sector is essentially very cash flow focused. There will be other
opportunities. So the world is landing tomorrow. There will be great deal on
many multifamily assets on some shopping centers and so on. There's going to be
a retrade. It's already happening today. So re-trade simply means that what
sold for 10 million a month ago, will trade now for seven and a half. Now
what's happening in the short run mortgage, the CMBS markets, Commercial
Mortgage Backed Securities markets are frozen.
in a senior position. Obviously self storage itself. The new projects, the new
origination has to, has to be very strategic in that whole business is a five
mile, three, five in one mile radius business. We do like those, we have a
number of those assets in the portfolio today. All the new stuff we're doing in
this sector is essentially very cash flow focused. There will be other
opportunities. So the world is landing tomorrow. There will be great deal on
many multifamily assets on some shopping centers and so on. There's going to be
a retrade. It's already happening today. So re-trade simply means that what
sold for 10 million a month ago, will trade now for seven and a half. Now
what's happening in the short run mortgage, the CMBS markets, Commercial
Mortgage Backed Securities markets are frozen.
So then all lenders who want to fund those deals, but when
these markets restabilize and lenders will come out, in fund again, the values
for trade values will come down quite a bit, but the cash flows have to
stabilize and reset. In other words, there's a lot of uncertainty. Who's going
to pay a rent on April 1st? Who's going to pay around May 1st? Who's going to
pay rent June 1st? Once that shakes in and there's going to be significant
level of re-trade, then the opportunities will come up. So literally 20, 25,
30% discounts are very possible once the numbers shake through. So the
opportunities are going to be coming up significant opportunities in the
commercial space. You just need to understand what they look like. So you that
you can invest with great confidence that you're getting a good deal.
these markets restabilize and lenders will come out, in fund again, the values
for trade values will come down quite a bit, but the cash flows have to
stabilize and reset. In other words, there's a lot of uncertainty. Who's going
to pay a rent on April 1st? Who's going to pay around May 1st? Who's going to
pay rent June 1st? Once that shakes in and there's going to be significant
level of re-trade, then the opportunities will come up. So literally 20, 25,
30% discounts are very possible once the numbers shake through. So the
opportunities are going to be coming up significant opportunities in the
commercial space. You just need to understand what they look like. So you that
you can invest with great confidence that you're getting a good deal.
Yeah. Yeah. I completely agree with Mike there on the
paper, on the commercial paper and if you want to know more about that visit,
you know, my website or if you have questions about it, I spent several years
doing that myself. So, there's many people on here that you can, you can talk to
about that. Does anyone have any, any questions or comments? Anyone on the,
Chris, Glenn, Jacob, Fuquan, anything that you want to say?
paper, on the commercial paper and if you want to know more about that visit,
you know, my website or if you have questions about it, I spent several years
doing that myself. So, there's many people on here that you can, you can talk to
about that. Does anyone have any, any questions or comments? Anyone on the,
Chris, Glenn, Jacob, Fuquan, anything that you want to say?
Well, we do have a question from Sohil, who asked in the
chat box and basically his question is, you know, what are the banks doing
since the land lords can't evict, you know, tenants for nonpayment for a
particular period of time? So, my feeling on that is it depends on who the bank
is. You know, your bigger banks, your, you know, your chase, your, Wells and
bank of America, they're gonna give a little forgiveness for, you know, a few
months too because, you know, they've already made a deal with the state of
California for the owner occupant type mortgages. I don't see that they're
going to change that for the commercial loans, but you know, some of your smaller
banks, you're just going to have to call them. That's basically how it works.
You're getting, most of them aren't going to volunteer to take deferrals.
You're going to have to prove to them that you're, you're going to have issues.
chat box and basically his question is, you know, what are the banks doing
since the land lords can't evict, you know, tenants for nonpayment for a
particular period of time? So, my feeling on that is it depends on who the bank
is. You know, your bigger banks, your, you know, your chase, your, Wells and
bank of America, they're gonna give a little forgiveness for, you know, a few
months too because, you know, they've already made a deal with the state of
California for the owner occupant type mortgages. I don't see that they're
going to change that for the commercial loans, but you know, some of your smaller
banks, you're just going to have to call them. That's basically how it works.
You're getting, most of them aren't going to volunteer to take deferrals.
You're going to have to prove to them that you're, you're going to have issues.
Yeah. Your core business or whatever it is, has been affected
by this virus. Yeah.
by this virus. Yeah.
Yeah. The bigger page, they have a big PR stuff going on
there. They're not going volunteer. You're going to have to ask. Glenn, did you
have something to say?
there. They're not going volunteer. You're going to have to ask. Glenn, did you
have something to say?
Yeah, I do. This is something that not only for banks, but
for us too. You know, we've got 350 properties under management, so there is a
60 day you cannot foreclose. So, but it, it does not alleviate people from the
rent payments. So we are expecting some bumps in the road. Obviously.
Fortunately about 50% of our tenants are, are section eight, so that'll take
care of itself. There's other, there's other government programs coming out for
assistance. Of course the stimulus package is going to help on that too. So, so
like what we did was we sent out a letter just saying, we understand what's
happening out here, but please understand, you know, there's, there will be
some grace here, but you know, the money is still going to eventually be due
and you know, we're going to be understanding here the next 60 days. But, you
know, you're still responsible for the rent. Understand we're showing them the
programs to go into check into and to, to help them to get the help that they
need.
for us too. You know, we've got 350 properties under management, so there is a
60 day you cannot foreclose. So, but it, it does not alleviate people from the
rent payments. So we are expecting some bumps in the road. Obviously.
Fortunately about 50% of our tenants are, are section eight, so that'll take
care of itself. There's other, there's other government programs coming out for
assistance. Of course the stimulus package is going to help on that too. So, so
like what we did was we sent out a letter just saying, we understand what's
happening out here, but please understand, you know, there's, there will be
some grace here, but you know, the money is still going to eventually be due
and you know, we're going to be understanding here the next 60 days. But, you
know, you're still responsible for the rent. Understand we're showing them the
programs to go into check into and to, to help them to get the help that they
need.
Yeah. One example to offer there too. On our retail
portfolio for example, we proactively approached all of our tenants and said,
we're going to defer two months of your base rent to kind of get them through
this. I mean, our success is their success and if they can reopen when this is
over, we're all going to be better off for it. And on the bank side in terms of
what banks are doing with these payment deferral issues, one of our banks
automatically offered a six months of interest only payments instead of
amortizing. And that'll save us quite a bit of money. And I was talking to one
of our bankers right now and as you can infer from what I've been working on
the last week, which bill mentioned earlier, it's been talking with bankers
often and regularly. As a regional bank in Kentucky, you were buying a few self
storage facilities about their next month and they had mentioned that they
forecast over 75% of their commercial loan portfolio to go into payment
deferral. And they're still down to land. They're still doing deals and they're
still moving forward. But this is a systemic issue and it's been kind of
refreshing to see kind of contrary to the last downturn that everybody is being
touched by these lenders, landlords and tenants and everyone's working together
to get through it.
portfolio for example, we proactively approached all of our tenants and said,
we're going to defer two months of your base rent to kind of get them through
this. I mean, our success is their success and if they can reopen when this is
over, we're all going to be better off for it. And on the bank side in terms of
what banks are doing with these payment deferral issues, one of our banks
automatically offered a six months of interest only payments instead of
amortizing. And that'll save us quite a bit of money. And I was talking to one
of our bankers right now and as you can infer from what I've been working on
the last week, which bill mentioned earlier, it's been talking with bankers
often and regularly. As a regional bank in Kentucky, you were buying a few self
storage facilities about their next month and they had mentioned that they
forecast over 75% of their commercial loan portfolio to go into payment
deferral. And they're still down to land. They're still doing deals and they're
still moving forward. But this is a systemic issue and it's been kind of
refreshing to see kind of contrary to the last downturn that everybody is being
touched by these lenders, landlords and tenants and everyone's working together
to get through it.
I have one quick comment on this. So it's exactly the
case. With, we were all in this together, so I did place a call. My wife is
optometrist here in Brooklyn, New York. We're closed. And I did call our
equivalent lender, Wells Fargo bank in 15 minutes conversation. I knew they
defer all immediately. They already have a policy in place for all distressed
areas. All you have to do is call. Request deferral, they'll deferral. That's
the basic step you can do for now. So it's, it's sort of a mitigation for two
or three months at this point. If this is a prolonged problem with people out
of work for more than 90 days, that will be probably step number two. You can
call back, get another few months. They understand, I think there's a
moratorium on foreclosures, moratorium on evictions. So just proactive
conversations. Take care of it. If you have tenants and they have an issue just
be prepared that, you have to do something to help them out. And that's the way
to do it. To get, do it together. Do it as a United country, we'll get through
this, but the banks are certainly very, very responsive today. All you do is
call explain that you are in a disaster zone. You're closed and they'll do an
immediate deferral menu.
case. With, we were all in this together, so I did place a call. My wife is
optometrist here in Brooklyn, New York. We're closed. And I did call our
equivalent lender, Wells Fargo bank in 15 minutes conversation. I knew they
defer all immediately. They already have a policy in place for all distressed
areas. All you have to do is call. Request deferral, they'll deferral. That's
the basic step you can do for now. So it's, it's sort of a mitigation for two
or three months at this point. If this is a prolonged problem with people out
of work for more than 90 days, that will be probably step number two. You can
call back, get another few months. They understand, I think there's a
moratorium on foreclosures, moratorium on evictions. So just proactive
conversations. Take care of it. If you have tenants and they have an issue just
be prepared that, you have to do something to help them out. And that's the way
to do it. To get, do it together. Do it as a United country, we'll get through
this, but the banks are certainly very, very responsive today. All you do is
call explain that you are in a disaster zone. You're closed and they'll do an
immediate deferral menu.
Yeah, yeah, definitely agree. You know, I think being
proactive as the other panelists mentioned, being proactive and reaching out to
your tenants, whether we have a large rental portfolio, in or, you know,
reaching out to your lenders and explain the situation. And when we're, you
know, fortunate enough to have, you know, a very high percentage, I would say
around 85% of our rentals with subsidized programs from New York and section
eight and things like that. You know, those programs for those landlords who
have that in place, they won't be as, you know, they won't feel the impact.
Like most of the people who are just, you know, we'll have cash tenants. We've
actually received a few calls that many on the note side where we had some
performing notes where people are asking, you know, what type of, what type of
programs that we have in place in order to help out with the current situation.
proactive as the other panelists mentioned, being proactive and reaching out to
your tenants, whether we have a large rental portfolio, in or, you know,
reaching out to your lenders and explain the situation. And when we're, you
know, fortunate enough to have, you know, a very high percentage, I would say
around 85% of our rentals with subsidized programs from New York and section
eight and things like that. You know, those programs for those landlords who
have that in place, they won't be as, you know, they won't feel the impact.
Like most of the people who are just, you know, we'll have cash tenants. We've
actually received a few calls that many on the note side where we had some
performing notes where people are asking, you know, what type of, what type of
programs that we have in place in order to help out with the current situation.
So we, you know, I've been in contact with our loan
service areas and like everyone else, we're willing to, you know, give a helping
hand to the current situation. Everyone will be impacted from this. Um, this
would definitely make everyone stronger and you know, for whatever's next to
come. But, there will be down a line possible opportunities for people who
position themselves over the last couple of years. You know, we've been in very
aggressive market, has been as a sellers market, you know, forever. So this
was, you know, inevitable. But it's, it's something we tend to take day by day
and make sure that we're executing on the plans. The benefit that, you know, I
see in all this is definitely more family time and more time to really evaluate
your strategy and you know, the people that seen your circle and who you're
doing business with. I actually, I actually have had a question on a private
lenders, you know, how are they being impacted, the hard money lenders and
stuff like that. I haven't heard too much. I'm hearing about the big things,
what they're doing, you know, to the homeowners, but what are you guys hearing
on a private lending and hard money lenders who may have projects up and
running that's, you know, been stopped through the townships not coming out
going inspections and stuff like that. Are you guys, well of course the first
day rule around yet, but what do you guys seeing on that end?
service areas and like everyone else, we're willing to, you know, give a helping
hand to the current situation. Everyone will be impacted from this. Um, this
would definitely make everyone stronger and you know, for whatever's next to
come. But, there will be down a line possible opportunities for people who
position themselves over the last couple of years. You know, we've been in very
aggressive market, has been as a sellers market, you know, forever. So this
was, you know, inevitable. But it's, it's something we tend to take day by day
and make sure that we're executing on the plans. The benefit that, you know, I
see in all this is definitely more family time and more time to really evaluate
your strategy and you know, the people that seen your circle and who you're
doing business with. I actually, I actually have had a question on a private
lenders, you know, how are they being impacted, the hard money lenders and
stuff like that. I haven't heard too much. I'm hearing about the big things,
what they're doing, you know, to the homeowners, but what are you guys hearing
on a private lending and hard money lenders who may have projects up and
running that's, you know, been stopped through the townships not coming out
going inspections and stuff like that. Are you guys, well of course the first
day rule around yet, but what do you guys seeing on that end?
Well, you know, that's a good question and that kind of,
I'm going to talk about that here in just a second. I know Jim and Mark both
had questions and I'm going to answer Mark's first and then I'm going to kind
of give you a take on what we're doing. You know, on the private lending side.
Mark had any rec, do we have any recommendations for alternatives to Peer
Street? They, they basically didn't close his loan 20 minutes before he was
supposed to close.
I'm going to talk about that here in just a second. I know Jim and Mark both
had questions and I'm going to answer Mark's first and then I'm going to kind
of give you a take on what we're doing. You know, on the private lending side.
Mark had any rec, do we have any recommendations for alternatives to Peer
Street? They, they basically didn't close his loan 20 minutes before he was
supposed to close.
To clarify that, that's a long term loan. that was a long
term loan.
term loan.
That's what I was gonna mention. We have almost every
lender out there that has institutional capital behind them or put a complete
pause on any longterm rental loans because they aren't sure about valuations
going forward.
lender out there that has institutional capital behind them or put a complete
pause on any longterm rental loans because they aren't sure about valuations
going forward.
And the secondary market was frozen when they made that
decision.
decision.
Yeah. And they, they sell those things off too, and
they're, they're in a position right now where there's too much unknown that's
going to be temporary until they figure out how, how valuations are going to go
and then they'll, they'll start lending again.
they're, they're in a position right now where there's too much unknown that's
going to be temporary until they figure out how, how valuations are going to go
and then they'll, they'll start lending again.
And that gets back to us and our portfolio. So we're a
private lender. We're working through a few deals that were already in the
pipeline. We're gonna, we're not stopping those in the middle of closing. We're
going to finish those out, but we're putting a pause on everything else coming
in. We're, we want to see how the valuations are going as well. Yeah. I
haven't, fortunately, we're in an area in the Southeast where things haven't
been completely closed down. Construction is still allowed to go on. The
largest County in our area is Mecklenburg County. That's the County that
Charlotte is in. They have a mandatory, you know, hunker down at home order.
But construction was an industry that they felt was vital and you're allowed to
go to work. However, the County government is, you know, kinda shut down and
they're not going out and doing inspections. So you can only do so much
construction work before you have to move to the next phase and you have to
have it inspected before you can move to the next phase. So I don't, I don't
know how that's gonna play in.
private lender. We're working through a few deals that were already in the
pipeline. We're gonna, we're not stopping those in the middle of closing. We're
going to finish those out, but we're putting a pause on everything else coming
in. We're, we want to see how the valuations are going as well. Yeah. I
haven't, fortunately, we're in an area in the Southeast where things haven't
been completely closed down. Construction is still allowed to go on. The
largest County in our area is Mecklenburg County. That's the County that
Charlotte is in. They have a mandatory, you know, hunker down at home order.
But construction was an industry that they felt was vital and you're allowed to
go to work. However, the County government is, you know, kinda shut down and
they're not going out and doing inspections. So you can only do so much
construction work before you have to move to the next phase and you have to
have it inspected before you can move to the next phase. So I don't, I don't
know how that's gonna play in.
Yeah. And I saw Mark, your comment about totally with short
term and in five years fund. The issue is still the valuations. It's the, it's
the LTVs it's the unknown right now for them. So you know, if you're looking
for a 70, 80% loan to value right now on current valuations, I think most
people are kind of out of that right now. And everyone's kind of sticking to 50
to 60 and lower for sure. And that's if they're even lending at that, at that
LTP, so,
term and in five years fund. The issue is still the valuations. It's the, it's
the LTVs it's the unknown right now for them. So you know, if you're looking
for a 70, 80% loan to value right now on current valuations, I think most
people are kind of out of that right now. And everyone's kind of sticking to 50
to 60 and lower for sure. And that's if they're even lending at that, at that
LTP, so,
And it's everybody, everyone in that industry is on pause
right now until they can get a better handle on the valuations. Yeah,
right now until they can get a better handle on the valuations. Yeah,
Yeah. Bill, I'll just second that exactly the
conversation. Secondary markets are completely frozen and major players in the
industry turned off especially we'll shoot back. The portfolio lenders are
doing exactly that, tightening up on the writing. So you may still get a file
here and there. We are still doing a few final loans with the old relationships
top clients. I actually have conversation with a couple of top guys. We do 20,
30 fix and flips per month. And some are operating just fine if they haven't
been shut down or the real estate is considered to be essential in their state
and some are closed. So the ones that are closed, asking for a discount,
deferral of interest and we'll work with them and those who are operating and
are able to get deals, they're getting deals actually at a better price.
conversation. Secondary markets are completely frozen and major players in the
industry turned off especially we'll shoot back. The portfolio lenders are
doing exactly that, tightening up on the writing. So you may still get a file
here and there. We are still doing a few final loans with the old relationships
top clients. I actually have conversation with a couple of top guys. We do 20,
30 fix and flips per month. And some are operating just fine if they haven't
been shut down or the real estate is considered to be essential in their state
and some are closed. So the ones that are closed, asking for a discount,
deferral of interest and we'll work with them and those who are operating and
are able to get deals, they're getting deals actually at a better price.
They're re-trading, their offer's coming back, lowering
them in the, they are trying to do the work, but the focus is on the most
affordable range. That's the only range we're looking at turnkey range, sort of
as affordable as it gets in the cities that don't fluctuate much in value. And
I believe that this is going to be some level of continuous construction though
in some cities in some will be completely turnoff. Like we had a conversation
with the gentleman from Philly, they're off. The quad cities are on and then in
the pockets here and there. But all major players are, they did disconnected
for the next couple of months, most likely until things stabilize. Just, I hate
to say this, but if you will have a loan request, just be patient. There's not
much you can do. You could send a lot of emails, a lot of requests, 90% of
players are going to be, turned off at this point of time.
them in the, they are trying to do the work, but the focus is on the most
affordable range. That's the only range we're looking at turnkey range, sort of
as affordable as it gets in the cities that don't fluctuate much in value. And
I believe that this is going to be some level of continuous construction though
in some cities in some will be completely turnoff. Like we had a conversation
with the gentleman from Philly, they're off. The quad cities are on and then in
the pockets here and there. But all major players are, they did disconnected
for the next couple of months, most likely until things stabilize. Just, I hate
to say this, but if you will have a loan request, just be patient. There's not
much you can do. You could send a lot of emails, a lot of requests, 90% of
players are going to be, turned off at this point of time.
You know, it's funny, I saw that the governor of Idaho put
a shelter in place order too, and they're one of the least populous staves out
there. So I know they have pockets of population, but even the ones that don't
have a lot of population are starting to do this. Do you want to ask the next
question?
a shelter in place order too, and they're one of the least populous staves out
there. So I know they have pockets of population, but even the ones that don't
have a lot of population are starting to do this. Do you want to ask the next
question?
Yeah. And we'll, and we need to get to Jim's question at
some point, but yeah.
some point, but yeah.
Well, I'm going to actually have to answer that. I'm going
to take Jim's question and ask everybody at the end.
to take Jim's question and ask everybody at the end.
Okay. Got it. All right, Glenn, Glenn, my question is for
you. I believe that most of your tenants seem to be in a somewhat rural areas
in your Wheel Estate. Do you think that that's an advantage or a disadvantage?
And kind of walk me through that.
you. I believe that most of your tenants seem to be in a somewhat rural areas
in your Wheel Estate. Do you think that that's an advantage or a disadvantage?
And kind of walk me through that.
You know, that's hard to say for sure. But I would say to
some degree, it's an advantage. They're away from a popular center. You know,
I'm here in downtown Fort worth, walked in my office this morning, and there is
nobody here. I mean, there's nobody here. Places shut down. I think rural areas
are a little bit more free to travel and so forth. But, but you know, only
time's gonna tell we're in unchartered territory here. It's really a tough, you
know, I, I've been, I heard, I heard a guy say this, but you know, after 9/11,
the 2008 crash, right? Everyone was able to dust themselves off and go back to
work the next day. You know, today we can't go to work. Right. That's the
problem. So, I think that, you know, the jury's out on that, but I, I would say
yes, I believe that that's going to be, you know, somewhat of an advantage.
But, I'll probably know a whole lot better in 60 days.
some degree, it's an advantage. They're away from a popular center. You know,
I'm here in downtown Fort worth, walked in my office this morning, and there is
nobody here. I mean, there's nobody here. Places shut down. I think rural areas
are a little bit more free to travel and so forth. But, but you know, only
time's gonna tell we're in unchartered territory here. It's really a tough, you
know, I, I've been, I heard, I heard a guy say this, but you know, after 9/11,
the 2008 crash, right? Everyone was able to dust themselves off and go back to
work the next day. You know, today we can't go to work. Right. That's the
problem. So, I think that, you know, the jury's out on that, but I, I would say
yes, I believe that that's going to be, you know, somewhat of an advantage.
But, I'll probably know a whole lot better in 60 days.
Yeah. Thank you. All right. And my next question is for
Fuquan. You invest in a variety of real estate, backed assets. Are you leaning
to any particular asset type or are you, you know, steering away from any
others and kind of walk, walk us through that. What are you, what are you
gravitating towards?
Fuquan. You invest in a variety of real estate, backed assets. Are you leaning
to any particular asset type or are you, you know, steering away from any
others and kind of walk, walk us through that. What are you, what are you
gravitating towards?
So I find the assets I find investing are a real property
local here in New Jersey. I've been investing in the last 20 years and also
notes nationwide. So again, we all, we don't have a crystal ball, but we
believe, you know, in the future policy, sometime around two, three, the mom
and pop landlords, you know, will be flooded and try and get liquidity. We
actually have a marketing campaign in place now to try to do more violent terms
for people who need fast liquidity, who can't refinance. So that's the tragedy
that we're applying now and we are not buying any more high end fix and flips.
So maybe, probably about two months ago, I kind of switched over to lower in,
you know, buy and sell properties. $350,000 resell price or less. Also, you
know, but the rental is because we are, we have relationships with women and
children programs, section eight where we rent subsidy units.
local here in New Jersey. I've been investing in the last 20 years and also
notes nationwide. So again, we all, we don't have a crystal ball, but we
believe, you know, in the future policy, sometime around two, three, the mom
and pop landlords, you know, will be flooded and try and get liquidity. We
actually have a marketing campaign in place now to try to do more violent terms
for people who need fast liquidity, who can't refinance. So that's the tragedy
that we're applying now and we are not buying any more high end fix and flips.
So maybe, probably about two months ago, I kind of switched over to lower in,
you know, buy and sell properties. $350,000 resell price or less. Also, you
know, but the rental is because we are, we have relationships with women and
children programs, section eight where we rent subsidy units.
So we're still increasing our rentals so we can find, you
know, someone who is looking for liquidity. We'll, you know, we're exercising
that option to kind of help them out and also take control of the property and
you know, do whatever upgrades need to be done and get someone who in the
subsidized program into the unit so we can kinda count on a cash flow as far as
the notes. And it's been a sellers market as I mentioned. Both for real estate
and notes. So we just made a trade in Q1 and we're kind of still going through
the onboarding process of that. We're actually probably on a lessons, you know,
single buyers, single people who have assets, want liquidity, who's willing to,
you know, get favorable pricing. We'll definitely execute on that. But that's
really the strategy. We're still doing notes and we start over real estate,
more rentals.
know, someone who is looking for liquidity. We'll, you know, we're exercising
that option to kind of help them out and also take control of the property and
you know, do whatever upgrades need to be done and get someone who in the
subsidized program into the unit so we can kinda count on a cash flow as far as
the notes. And it's been a sellers market as I mentioned. Both for real estate
and notes. So we just made a trade in Q1 and we're kind of still going through
the onboarding process of that. We're actually probably on a lessons, you know,
single buyers, single people who have assets, want liquidity, who's willing to,
you know, get favorable pricing. We'll definitely execute on that. But that's
really the strategy. We're still doing notes and we start over real estate,
more rentals.
Then it flips because again, we don't know where the
market with a pricing is going to be 15, 20%. You're hearing all types of stuff,
but no one has a crystal ball. I'm like everyone else, we're just making sure
that we have liquidity and that you know, when the opportunity that we can, you
know, definitely benefit from that. Again, first and foremost, you know, the
landlords that are looking for liquidity and have stuff in our geographically
area, we're going to execute on that. And if we find out between these it
notes, it's still the same strategy but just, you know, no more high end stuff.
I actually have one high end property now in the market, put up, put in a
market and Valentine's day and you know, who knows where the pricing has been a
reset to that. But there's enough equity in that first to be okay. But our
strategy is pretty much still the same diversified hybrid real estate investing
model. The people who just did fix and flip. So wholesales or just notes or I
had one type of investment strategy, you know, whether it's going to buffer
what hedge against, you know, what we're going through right now. Those are the
people who's going to feel the impact. So our strategy's pretty much the same,
a mixed portfolio of real property and mortgage notes.
market with a pricing is going to be 15, 20%. You're hearing all types of stuff,
but no one has a crystal ball. I'm like everyone else, we're just making sure
that we have liquidity and that you know, when the opportunity that we can, you
know, definitely benefit from that. Again, first and foremost, you know, the
landlords that are looking for liquidity and have stuff in our geographically
area, we're going to execute on that. And if we find out between these it
notes, it's still the same strategy but just, you know, no more high end stuff.
I actually have one high end property now in the market, put up, put in a
market and Valentine's day and you know, who knows where the pricing has been a
reset to that. But there's enough equity in that first to be okay. But our
strategy is pretty much still the same diversified hybrid real estate investing
model. The people who just did fix and flip. So wholesales or just notes or I
had one type of investment strategy, you know, whether it's going to buffer
what hedge against, you know, what we're going through right now. Those are the
people who's going to feel the impact. So our strategy's pretty much the same,
a mixed portfolio of real property and mortgage notes.
Okay, excellent. You know, one of the benefits of this
happening is that it's happening to everyone. So, everyone is going to be a
little more apps to work with with each other because if it's happening to
everyone, so...
happening is that it's happening to everyone. So, everyone is going to be a
little more apps to work with with each other because if it's happening to
everyone, so...
And you have to, I mean you have to keep in mind, you
know, and go back, I guess to Mark's question a little bit, lenders are looking
at all these deals right now as is as if, if this is the last amount of money I
have to do this deal, would I do this deal and every, and so that's how
everyone is looking at everything right now. And just keep that in mind. I
mean, you know, like Mike said, have some patience because the secondary
markets are frozen and people are having to evaluate these deals on asset by
asset case by case basis. And it's, you know, everyone wants to keep some
powder dry cause we don't know what's going to happen.
know, and go back, I guess to Mark's question a little bit, lenders are looking
at all these deals right now as is as if, if this is the last amount of money I
have to do this deal, would I do this deal and every, and so that's how
everyone is looking at everything right now. And just keep that in mind. I
mean, you know, like Mike said, have some patience because the secondary
markets are frozen and people are having to evaluate these deals on asset by
asset case by case basis. And it's, you know, everyone wants to keep some
powder dry cause we don't know what's going to happen.
And if you're just joining us, you can ask a question over
there in the, in the chat box and time permitting, we'll, we'll ask the
panelists before we can get outta here and if we can't get to it by then we'll
try to answer you offline. So, I was going to ask who, Chris, you've been over
there smiling the whole time? I haven't asked you anything. I'm sorry. So,
Chris is our anti-financial advisor and I'm curious what, what is the majority
of your clients? I know they've been calling you with questions and comments.
What is the majority of the subjects of those questions that you've been asked
recently?
there in the, in the chat box and time permitting, we'll, we'll ask the
panelists before we can get outta here and if we can't get to it by then we'll
try to answer you offline. So, I was going to ask who, Chris, you've been over
there smiling the whole time? I haven't asked you anything. I'm sorry. So,
Chris is our anti-financial advisor and I'm curious what, what is the majority
of your clients? I know they've been calling you with questions and comments.
What is the majority of the subjects of those questions that you've been asked
recently?
Yeah, well, most of my active clients, most of them I've
been, thank you, right? Because we've been very cash flow focused, you know,
providing passive income, things like that. And I had one client was in
California that said, Chris, man, I am so glad I'm not in the market right now
cause I just pulled out last fall, saved me a quarter million dollars of
losses. Right. But I'll tell you the other side, the people that didn't hire
me, even some from last fall, the same ones are saying, I just lost a couple of
hundred thousand and I hope it comes back. One of them was about to retire next
year and now it's saying, well, maybe I should work another five years. Right.
It's, it's a fun time right now depending on what perspective you have. It's
definitely new in so many different ways, but I think the fundamentals are
still the same. You know? Biggest advice I've been given my clients, even
leading up to this was get lean, get liquid and get out. Right? You know,
obviously get lean in the sense of like we've already heard before, right? Like
make sure that we're trimming the fat, that we're kind of limiting, eliminating
unnecessary expenses, like really doing, putting our focus on how do we be as
profitable as possible.
been, thank you, right? Because we've been very cash flow focused, you know,
providing passive income, things like that. And I had one client was in
California that said, Chris, man, I am so glad I'm not in the market right now
cause I just pulled out last fall, saved me a quarter million dollars of
losses. Right. But I'll tell you the other side, the people that didn't hire
me, even some from last fall, the same ones are saying, I just lost a couple of
hundred thousand and I hope it comes back. One of them was about to retire next
year and now it's saying, well, maybe I should work another five years. Right.
It's, it's a fun time right now depending on what perspective you have. It's
definitely new in so many different ways, but I think the fundamentals are
still the same. You know? Biggest advice I've been given my clients, even
leading up to this was get lean, get liquid and get out. Right? You know,
obviously get lean in the sense of like we've already heard before, right? Like
make sure that we're trimming the fat, that we're kind of limiting, eliminating
unnecessary expenses, like really doing, putting our focus on how do we be as
profitable as possible.
Even if this is your own personal cash flow, you know, how
do we make sure you have enough cash, the buffer and that leads into the get
liquid. How do we make sure we have savings and money available? I've had
people go and I even told my clients a couple of weeks ago, I did a group call.
I said, guys, everybody hit the bank, get your gear, make sure you have a key
lock in place. Get up to at least 80 or 90% and then cash it out. And then as
an extra measure of protection, move it to another bank, right? Just in case,
because we never know what banks can do because if I learned anything from the
last recession, the last recession, what happened there is that banks cut
limits like crazy. Once things got tight and we're already seeing the
commercial space, it will happen in the residential space here pretty soon is
that if we don't get that money out, it's going to be trapped in there.
do we make sure you have enough cash, the buffer and that leads into the get
liquid. How do we make sure we have savings and money available? I've had
people go and I even told my clients a couple of weeks ago, I did a group call.
I said, guys, everybody hit the bank, get your gear, make sure you have a key
lock in place. Get up to at least 80 or 90% and then cash it out. And then as
an extra measure of protection, move it to another bank, right? Just in case,
because we never know what banks can do because if I learned anything from the
last recession, the last recession, what happened there is that banks cut
limits like crazy. Once things got tight and we're already seeing the
commercial space, it will happen in the residential space here pretty soon is
that if we don't get that money out, it's going to be trapped in there.
And there's some people who've been gambling and been
banking with their Hillocks, you know, cashing out, investing and then using
all the cash flow to put it back on their Hillocks well if they cut back those
limits, all that money you owe, that cash flow you had earned is going to be
trapped inside your home equity and now you're going to be illiquid and that's
going to put you in a world of hurt. So that's what I mean by that is like, you
know, get lean, you'll get liquid and then get out. You know, I can't legally
tell anybody to sell off their stocks or mutual funds or whatnot, but man, like
there's, I remember when it was down 5% I was saying, are you sure you want to
be in this? And people are like, wow, I don't know. I don't want to lose 5% you
know, now the market, even with a little recovery is still down about 25% you
know?
banking with their Hillocks, you know, cashing out, investing and then using
all the cash flow to put it back on their Hillocks well if they cut back those
limits, all that money you owe, that cash flow you had earned is going to be
trapped inside your home equity and now you're going to be illiquid and that's
going to put you in a world of hurt. So that's what I mean by that is like, you
know, get lean, you'll get liquid and then get out. You know, I can't legally
tell anybody to sell off their stocks or mutual funds or whatnot, but man, like
there's, I remember when it was down 5% I was saying, are you sure you want to
be in this? And people are like, wow, I don't know. I don't want to lose 5% you
know, now the market, even with a little recovery is still down about 25% you
know?
And so at what point, you know, psychologically people
don't pull their money out, right? They just stay in there, ride it, no matter
how long it takes. Now the question is, can I get my money out? And like what
you guys just said, be patient. You know, look for opportunity. Personally, I'm
still buying properties. I know I even just been emailing Glen, looking at some
of his properties to buy for cash flow right now while keeping otherly money
liquid and available for later about a 50 50 split. So that's kind of what I'm
seeing and that's, that's kinda what's happening. Again, my clients are feeling
pretty good because they have cashflow coming in. But for those that don't the
time to act is now.
don't pull their money out, right? They just stay in there, ride it, no matter
how long it takes. Now the question is, can I get my money out? And like what
you guys just said, be patient. You know, look for opportunity. Personally, I'm
still buying properties. I know I even just been emailing Glen, looking at some
of his properties to buy for cash flow right now while keeping otherly money
liquid and available for later about a 50 50 split. So that's kind of what I'm
seeing and that's, that's kinda what's happening. Again, my clients are feeling
pretty good because they have cashflow coming in. But for those that don't the
time to act is now.
Well, one of the benefits of the insurance program that
you're always touting. The cap value life policy is that you could take a,
here's a great strategy. You go ahead and get that hillock Orlana credit. You
go ahead and get the cash, you don't have to worry about putting it in another
bank. You can actually cash value life insurance policy, which will probably
pay you more than when it's costing you on the interest rate you're paying on
the hillock.Right?
you're always touting. The cap value life policy is that you could take a,
here's a great strategy. You go ahead and get that hillock Orlana credit. You
go ahead and get the cash, you don't have to worry about putting it in another
bank. You can actually cash value life insurance policy, which will probably
pay you more than when it's costing you on the interest rate you're paying on
the hillock.Right?
Right, exactly. It's like you guys mentioned dry powder. I
mean if you don't know how long they'd be moving, that's what's that. And that
part of it is tax free too. That's right. It's tax free. It's kind of like a
supercharged savings account slash Roth IRA in a sense. Right. Where it's
tax-free, get better returns than that. Definitely better returns in savings
right now. Now that the rates have tanked completely. So yeah, I mean there's,
there's definitely great options to be able to store cash, keep it safe. And
another thing too, in most States you can keep your money safe from creditors
and lawsuits. So as we get on the other side of this, are people going to start
getting Sue happy? Are people going to try to get money from any place they
can? You know, because there is no doubt we are moving into a very deep
recession as a result of this, if not a depression, just depending on how this
all plays out. So, protecting your money, stay in liquid, make sure it's there,
but still earning money on it too is I think absolutely essential right now.
mean if you don't know how long they'd be moving, that's what's that. And that
part of it is tax free too. That's right. It's tax free. It's kind of like a
supercharged savings account slash Roth IRA in a sense. Right. Where it's
tax-free, get better returns than that. Definitely better returns in savings
right now. Now that the rates have tanked completely. So yeah, I mean there's,
there's definitely great options to be able to store cash, keep it safe. And
another thing too, in most States you can keep your money safe from creditors
and lawsuits. So as we get on the other side of this, are people going to start
getting Sue happy? Are people going to try to get money from any place they
can? You know, because there is no doubt we are moving into a very deep
recession as a result of this, if not a depression, just depending on how this
all plays out. So, protecting your money, stay in liquid, make sure it's there,
but still earning money on it too is I think absolutely essential right now.
Yeah. And if you're worried about it not being liquid in
the insurance policy, you can easily borrow against that while the balance is
still earning and you can use that money to find those deals that have cash
flow when those opportunities come up. So, it's easy to get liquid in those
accounts as well. And you still have that asset protection, right?
the insurance policy, you can easily borrow against that while the balance is
still earning and you can use that money to find those deals that have cash
flow when those opportunities come up. So, it's easy to get liquid in those
accounts as well. And you still have that asset protection, right?
That's right. Yeah. It's, yeah, it's all about the, how
you design it, make it a minimal cost, maximum gains. You know, it's, it's
definitely a big thing of it. But yeah, it's a, it's a great time right now to
be able to protect what you have and then grow it to I, I really, I'm very
excited for the opportunities because of the last couple of recessions I've
weathered. This is the best financial position I've been in. So I'm like, I got
my gloves ready. I'm like, I'm ready for this, you know, let's bring it on. You
know, we're all going to be affected this some way. But you know, I've been
preparing for the last decade for this next recession cause I got hit so hard
in the last one. So this one I have, it's all new, but I still have a lot more
confidence than I've had other times when we've been freaking out.
you design it, make it a minimal cost, maximum gains. You know, it's, it's
definitely a big thing of it. But yeah, it's a, it's a great time right now to
be able to protect what you have and then grow it to I, I really, I'm very
excited for the opportunities because of the last couple of recessions I've
weathered. This is the best financial position I've been in. So I'm like, I got
my gloves ready. I'm like, I'm ready for this, you know, let's bring it on. You
know, we're all going to be affected this some way. But you know, I've been
preparing for the last decade for this next recession cause I got hit so hard
in the last one. So this one I have, it's all new, but I still have a lot more
confidence than I've had other times when we've been freaking out.
Excellent. Yeah. Well I have a, again, if you're just
joining us, you can ask questions in the chat box and we'll make sure we try to
do our best to get to them. Before we end the show. I'm going to go with, Jim's
question and he's asking what we're doing in our personal portfolio in our own
investments. You know, what are we doing? Are we looking? Are we waiting? Have
we made any changes? And I can, I can tell you what we're doing. In our fund, I
already mentioned that we're putting loans on right now, the ones that we're
working through, I can tell you we're getting advanced interest payments that
are part of the deal. So we're putting, three to six months in advanced
payments and an escrow account. Plus we're lowering our LTVs.
joining us, you can ask questions in the chat box and we'll make sure we try to
do our best to get to them. Before we end the show. I'm going to go with, Jim's
question and he's asking what we're doing in our personal portfolio in our own
investments. You know, what are we doing? Are we looking? Are we waiting? Have
we made any changes? And I can, I can tell you what we're doing. In our fund, I
already mentioned that we're putting loans on right now, the ones that we're
working through, I can tell you we're getting advanced interest payments that
are part of the deal. So we're putting, three to six months in advanced
payments and an escrow account. Plus we're lowering our LTVs.
And they're going to be properties and we've already done
this that are going to be affordable housing. And we made that shift last year
to go to strictly the affordable housing market with loans in our fund. Those
are going to be the, the safest. They're going to be the ones that can create
cash flow if they're not currently, but they're also the easiest to move if you
have to if you end up owning them because you know, the price points are low
and, everybody wants them, you know, they're valuable assets. So I'm going to
go around the horn and ask that same question to everyone. I'm going to start
with Mike. Mike, what are you doing with your portfolio currently? What's your
current strategy? And I'm going to say until you get better information.
this that are going to be affordable housing. And we made that shift last year
to go to strictly the affordable housing market with loans in our fund. Those
are going to be the, the safest. They're going to be the ones that can create
cash flow if they're not currently, but they're also the easiest to move if you
have to if you end up owning them because you know, the price points are low
and, everybody wants them, you know, they're valuable assets. So I'm going to
go around the horn and ask that same question to everyone. I'm going to start
with Mike. Mike, what are you doing with your portfolio currently? What's your
current strategy? And I'm going to say until you get better information.
Sure. So we're going through the entire portfolio. So one
is a personal, the other one is a is obviously fund. But the exercise is
identical is look for for a risky points. So what do we have in the portfolio
we believe has a exposure to these market conditions and to what extent, and
essentially a mathematic was simulate a stress condition. Assume things are
going to go really bad and just project, you know, what's our exposure, what
are our risks in? The main question is what can we do about it? There's nothing
we can do about it. Well, it's good to know that something is at risk. But, if
we, nothing we can do, there's nothing we can do. There are situations where we
can obviously impact and make changes. And that's what we're looking for. We're
looking for what's at risk and what we can do to improve.
is a personal, the other one is a is obviously fund. But the exercise is
identical is look for for a risky points. So what do we have in the portfolio
we believe has a exposure to these market conditions and to what extent, and
essentially a mathematic was simulate a stress condition. Assume things are
going to go really bad and just project, you know, what's our exposure, what
are our risks in? The main question is what can we do about it? There's nothing
we can do about it. Well, it's good to know that something is at risk. But, if
we, nothing we can do, there's nothing we can do. There are situations where we
can obviously impact and make changes. And that's what we're looking for. We're
looking for what's at risk and what we can do to improve.
And then, the, we're also looking obviously for the
strengths in the portfolio. It's basically a review process, go through
everything, think through what you can do today. And obviously for scarring,
where can we, reduce risk or reduce costs as well. So cutting, increasing
liquidity where we have pretty high liquidity of this point. So we have a lot
of dry ammo. We actually very happy that we have both 50% of our flagship fund
is in cash. And that's, that's a lot of dry ammo and that, that's been sort of
preparation. We can't have too much cash in the bank. It burns a hole in
essence because we got to put it to work. But at the same time, 15% in this
market feels pretty good. So that's, that's the key basic staff. The, we're
having conversations with a lot of our project sponsors and borrowers and understanding
what's happening with our business, how we can help, what adjustments we need
to make. That might be great opportunities. Where they need a little bit more
liquidity, we can come in, save the project which we'll already know, get a
good return on incremental capital and protect our existing investment. So
that's what we're doing. We analyzing existing portfolio because new deals are
sort of frozen. So it's a time to look with what you got and how you can
improve it.
strengths in the portfolio. It's basically a review process, go through
everything, think through what you can do today. And obviously for scarring,
where can we, reduce risk or reduce costs as well. So cutting, increasing
liquidity where we have pretty high liquidity of this point. So we have a lot
of dry ammo. We actually very happy that we have both 50% of our flagship fund
is in cash. And that's, that's a lot of dry ammo and that, that's been sort of
preparation. We can't have too much cash in the bank. It burns a hole in
essence because we got to put it to work. But at the same time, 15% in this
market feels pretty good. So that's, that's the key basic staff. The, we're
having conversations with a lot of our project sponsors and borrowers and understanding
what's happening with our business, how we can help, what adjustments we need
to make. That might be great opportunities. Where they need a little bit more
liquidity, we can come in, save the project which we'll already know, get a
good return on incremental capital and protect our existing investment. So
that's what we're doing. We analyzing existing portfolio because new deals are
sort of frozen. So it's a time to look with what you got and how you can
improve it.
Excellent. Thank you. Jacob?
We're just generally trying to be defensive and we're
trying to be more liquid. We're looking at more cost cutting measures, not
because we're out of money, but just so we can buy ourselves a lot more runway
through this downturn. I mentioned it earlier, but we're focused a lot more on
cash flow with new acquisitions. In terms of managing our existing portfolio,
really our only problem areas are retail line of business. And we're doing
everything we can to, to mitigate that with renovate meant, cutting deals with
lenders. But our storage business, as I mentioned, is not seeing any really
negative effects from this yet. We're trying to acquire new acquisitions with
longterm debt, so we're not up against a short term maturity date and we're
trying to buy deals that aren't reliant on a low cap rate exit and a couple of
years, again, just more focused on cash flow. Personally I'm not really doing
anything different. We've got our rental portfolio of single family residences
and some storage facilities outside of our various institutional and private
equity partnerships that we're holding onto. So not really doing anything
directly different within our current asset base, other than just trying to
manage risk and really focus on cash flow and downside mitigation.
trying to be more liquid. We're looking at more cost cutting measures, not
because we're out of money, but just so we can buy ourselves a lot more runway
through this downturn. I mentioned it earlier, but we're focused a lot more on
cash flow with new acquisitions. In terms of managing our existing portfolio,
really our only problem areas are retail line of business. And we're doing
everything we can to, to mitigate that with renovate meant, cutting deals with
lenders. But our storage business, as I mentioned, is not seeing any really
negative effects from this yet. We're trying to acquire new acquisitions with
longterm debt, so we're not up against a short term maturity date and we're
trying to buy deals that aren't reliant on a low cap rate exit and a couple of
years, again, just more focused on cash flow. Personally I'm not really doing
anything different. We've got our rental portfolio of single family residences
and some storage facilities outside of our various institutional and private
equity partnerships that we're holding onto. So not really doing anything
directly different within our current asset base, other than just trying to
manage risk and really focus on cash flow and downside mitigation.
Excellent. Glenn, you're up.
Yeah, we're good. You know, obviously what we're doing,
we're in the affordable housing space right now. We're already seeing, which
is, you know, we saw this in 2008 and I've seen it before. Prices are coming
down fast. That's why the capital markets are freezing up. Fortunately we have
a lot of private investors that understand that, get it. And so, yeah, prices
are going down. We're renegotiating some deals. And, so from, from a business
point of view, yes, we're tightening the ship, we're tightening the ship,
we're, we're cutting all of our expenses and so forth. But, but no, I think
everybody said it on the, on this, you know, on this call that cash flow is the
name of the game. And, you know, we think the cashflow is going to get better
now because the prices are coming down.
we're in the affordable housing space right now. We're already seeing, which
is, you know, we saw this in 2008 and I've seen it before. Prices are coming
down fast. That's why the capital markets are freezing up. Fortunately we have
a lot of private investors that understand that, get it. And so, yeah, prices
are going down. We're renegotiating some deals. And, so from, from a business
point of view, yes, we're tightening the ship, we're tightening the ship,
we're, we're cutting all of our expenses and so forth. But, but no, I think
everybody said it on the, on this, you know, on this call that cash flow is the
name of the game. And, you know, we think the cashflow is going to get better
now because the prices are coming down.
They're coming down pretty hard. So I think there's, there's
a real opportunity out there. I like what Chris said. I'm, I'm, you know, I,
I've been, I actually built my company for this because I, you know, I knew it
was coming and, and I, of course, I thought it was gonna be three years ago to
be honest with you. So I'm, I'm waiting on that. But, but it was, you know, we
just knew the charge. There was going to be some kind of a reset here and a
yes, with, with, with affordable housing, I totally believe people are going to
do two things. Number one, they're going to eat. Number two, they've got a roof
over their head. And when you have the most affordable roof, I feel like we're
longterm one. We're insulated. Like I said, short term, there's going to be
some bumps on the road with ramps and so forth. So that's our plan.
a real opportunity out there. I like what Chris said. I'm, I'm, you know, I,
I've been, I actually built my company for this because I, you know, I knew it
was coming and, and I, of course, I thought it was gonna be three years ago to
be honest with you. So I'm, I'm waiting on that. But, but it was, you know, we
just knew the charge. There was going to be some kind of a reset here and a
yes, with, with, with affordable housing, I totally believe people are going to
do two things. Number one, they're going to eat. Number two, they've got a roof
over their head. And when you have the most affordable roof, I feel like we're
longterm one. We're insulated. Like I said, short term, there's going to be
some bumps on the road with ramps and so forth. So that's our plan.
So, so that was you, the guy on the corner in Fort worth
downtown with the sign going in the end is near.
downtown with the sign going in the end is near.
Yeah. I always get accused of the glasses. I don't have to
fool you know, that that's what I would do. None of us, none of us could have
projected the Corona Virus. Right? Nobody could get that, but the charge was screaming
for some kind of a reset or a pause or whatever. So that's, and you know, and
that's kind of what I learned in 2008 to try to have kind of a strategy that
works, whether it's good times or bad times and rentals or affordable houses. I
think working in any market. So that's my, that's my take.
fool you know, that that's what I would do. None of us, none of us could have
projected the Corona Virus. Right? Nobody could get that, but the charge was screaming
for some kind of a reset or a pause or whatever. So that's, and you know, and
that's kind of what I learned in 2008 to try to have kind of a strategy that
works, whether it's good times or bad times and rentals or affordable houses. I
think working in any market. So that's my, that's my take.
Well, all of us as a group, because we are in all the same
masterminds. We've all been preparing for the last couple of years because we
knew the market was kind of at the top anyway and it can't, couldn't do
anything but go the other way for a little while. He just need to prepare. You
don't assume it's going to happen, but you assume it's going to happen. You
just need to be in a position to weather it when it does. Fuquan, what about
you? What are you working on?
masterminds. We've all been preparing for the last couple of years because we
knew the market was kind of at the top anyway and it can't, couldn't do
anything but go the other way for a little while. He just need to prepare. You
don't assume it's going to happen, but you assume it's going to happen. You
just need to be in a position to weather it when it does. Fuquan, what about
you? What are you working on?
Yeah, well we did in the last two weeks. You're coming
back from the CGO event especially, and knowing what was eventually going to be
the outcome that we're in now. Things slowing down of all the talk that was out
there. We've actually been, you know, any projects we didn't start yet. We are
in a process of, you know, putting those projects out for bid again to other
contractors we may not be working anymore and give them an opportunity to get
back into, you know, doing the job and given us an, obviously I need to get the
open contracts. We didn't start at reprice and we shifted most of the focus to
finishing up the rentals instead of, you know, having a big cruise at the, you
know, the flip properties. We moved out those crews all into the rentals cause
we have, um, you know, pretty much a waiting list for the subsidized department.
back from the CGO event especially, and knowing what was eventually going to be
the outcome that we're in now. Things slowing down of all the talk that was out
there. We've actually been, you know, any projects we didn't start yet. We are
in a process of, you know, putting those projects out for bid again to other
contractors we may not be working anymore and give them an opportunity to get
back into, you know, doing the job and given us an, obviously I need to get the
open contracts. We didn't start at reprice and we shifted most of the focus to
finishing up the rentals instead of, you know, having a big cruise at the, you
know, the flip properties. We moved out those crews all into the rentals cause
we have, um, you know, pretty much a waiting list for the subsidized department.
So we're trying to just focus 100% on getting that done
where everything's in slow period and we don't know what a flip market is going
to be. As far as the notes, we really didn't pay more attention to the 10 out
of 12 payments. You know, the people who's behind 60 days trying to offer, you
know, something that's more affordable and trying to see if they've been
affected and really doing a lot of bar outreach and staying in contact with our
attorneys organically finding out, you know, what's happening in the local
market, what courts are closed. Pretty much all of them now. But really just in
my net, really in my personal portfolio, I've been looking, cause I don't, I
can't buy a new set of the company. All of this. I've been looking for onesy
twosy notice that people may want to sell full liquidity and build some
hypothecation. I've been on the phone with my bankers trying to execute in the
lines of credit that they've been trying to get me to do for the past four or
five months. So just focus in on that really. And just keeping up and making
sure that I'm all phone calls and I'm communicating over communicating with
investors and, you know, keep my ear to the street and what's happening.
where everything's in slow period and we don't know what a flip market is going
to be. As far as the notes, we really didn't pay more attention to the 10 out
of 12 payments. You know, the people who's behind 60 days trying to offer, you
know, something that's more affordable and trying to see if they've been
affected and really doing a lot of bar outreach and staying in contact with our
attorneys organically finding out, you know, what's happening in the local
market, what courts are closed. Pretty much all of them now. But really just in
my net, really in my personal portfolio, I've been looking, cause I don't, I
can't buy a new set of the company. All of this. I've been looking for onesy
twosy notice that people may want to sell full liquidity and build some
hypothecation. I've been on the phone with my bankers trying to execute in the
lines of credit that they've been trying to get me to do for the past four or
five months. So just focus in on that really. And just keeping up and making
sure that I'm all phone calls and I'm communicating over communicating with
investors and, you know, keep my ear to the street and what's happening.
Excellent. Chris, what about you?
You know, I kind of already alluded to it before, but, you
know, my personal portfolio, I mean, we've even pulled whatever little money we
hadn't even gambling and Bitcoin in the stock market. I mean, we're pulling it
out, we're getting it out into our hands. Uh, liquidity has been the, the main
thing, right? So like for example, personal savings, we made sure we had, you
know, at least eight months worth of expenses, you know, that we could ride on
for business and personal. Now naturally, cause I don't want that earning
point. Nothing percent in the bank. You know, we got a good chunk of that in my
life. Insurance policies and things like that. So it's stored up and it's
waiting. But actively like there's still deals and look for, so specifically
I'm looking at turnkey single family homes.
know, my personal portfolio, I mean, we've even pulled whatever little money we
hadn't even gambling and Bitcoin in the stock market. I mean, we're pulling it
out, we're getting it out into our hands. Uh, liquidity has been the, the main
thing, right? So like for example, personal savings, we made sure we had, you
know, at least eight months worth of expenses, you know, that we could ride on
for business and personal. Now naturally, cause I don't want that earning
point. Nothing percent in the bank. You know, we got a good chunk of that in my
life. Insurance policies and things like that. So it's stored up and it's
waiting. But actively like there's still deals and look for, so specifically
I'm looking at turnkey single family homes.
You know, I mentioned Glen stuff and you know, things like
that. I've been looking at other funds for money down the road, you know as
well with syndications, much like the funds that you guys have that you guys
are offering as well. So it's really a matter of like, Hey, I've got money
sitting here. We got, you know, worst case scenario. If income stops
completely, we're good for months, we can weather this out and be fine. But we
also got investment money over here as well. You know, another chunk that
someone's going to be actively investing currently, you know, getting some more
cash. We'll keep building that up while keeping more cash on the side of
saying, all right, we see what's coming. Hey, what if these big box stores and
all these malls and things go out of business? Are they going to start turning
into self storage?
that. I've been looking at other funds for money down the road, you know as
well with syndications, much like the funds that you guys have that you guys
are offering as well. So it's really a matter of like, Hey, I've got money
sitting here. We got, you know, worst case scenario. If income stops
completely, we're good for months, we can weather this out and be fine. But we
also got investment money over here as well. You know, another chunk that
someone's going to be actively investing currently, you know, getting some more
cash. We'll keep building that up while keeping more cash on the side of
saying, all right, we see what's coming. Hey, what if these big box stores and
all these malls and things go out of business? Are they going to start turning
into self storage?
Cool. Is that what the direction could start moving? It's
just watching and just waiting in a lot of ways. And you know, like I said,
it's a, it's a fun time right now. The one thing I know I'm not investing in is
we're definitely not putting money in the stock market. It is not at the level.
Whenever I hear people say, Hey, we should dollar cost average, we should put
money in now cause that the low, I was like, that's the dumbest time to put it
in. When have we ever had a recession where it dropped in one month and then
recovered and never takes a couple of years. So that's the worst time to put
money in, you know. But now real estate I think is still one of the overall
still one of the safer places to be in right now.
just watching and just waiting in a lot of ways. And you know, like I said,
it's a, it's a fun time right now. The one thing I know I'm not investing in is
we're definitely not putting money in the stock market. It is not at the level.
Whenever I hear people say, Hey, we should dollar cost average, we should put
money in now cause that the low, I was like, that's the dumbest time to put it
in. When have we ever had a recession where it dropped in one month and then
recovered and never takes a couple of years. So that's the worst time to put
money in, you know. But now real estate I think is still one of the overall
still one of the safer places to be in right now.
God is only making so much more land and it's not
inhabitable very quickly. You know, the volcanoes are what adds land and it's
going to take a while for those to be occupiable. So, whether it's, you know,
obviously residential is the most coveted and you know, people always need two
things food and shelter and so you can, if you're going to invest in the stock market,
do it with grocery chains. Yeah, yeah, I'm kidding. Otherwise, you know, keep
it in, in real estate. So listen, I want to thank you guys for joining us. I do
want to mention with the bill that was passed last night, I'm sure there's
going to be some other changes made to it. So don't take the details you see
and hear about right now. It's a heart. There's gonna probably be a few
adjustments. And if you're in a position where you think these loans are all
going to be forgivable and you can't afford to pay them back, don't get the
loan because there's no guarantee they're going to be a forgivable either. Wait
until the details come out and again, call your banker and get into position.
If you can get lines of credit and get liquid, I suggest you do that.
inhabitable very quickly. You know, the volcanoes are what adds land and it's
going to take a while for those to be occupiable. So, whether it's, you know,
obviously residential is the most coveted and you know, people always need two
things food and shelter and so you can, if you're going to invest in the stock market,
do it with grocery chains. Yeah, yeah, I'm kidding. Otherwise, you know, keep
it in, in real estate. So listen, I want to thank you guys for joining us. I do
want to mention with the bill that was passed last night, I'm sure there's
going to be some other changes made to it. So don't take the details you see
and hear about right now. It's a heart. There's gonna probably be a few
adjustments. And if you're in a position where you think these loans are all
going to be forgivable and you can't afford to pay them back, don't get the
loan because there's no guarantee they're going to be a forgivable either. Wait
until the details come out and again, call your banker and get into position.
If you can get lines of credit and get liquid, I suggest you do that.
You, you don't want to put it under the mattress. But at
the same time, don't keep it in the same bank they gave it to you. Yep. Great.
Anyway, that said, we're going to be doing this once a week for the foreseeable
future to kind of give everybody an insight into what's going on in our, in our
world. Again, thank everybody for joining us.
the same time, don't keep it in the same bank they gave it to you. Yep. Great.
Anyway, that said, we're going to be doing this once a week for the foreseeable
future to kind of give everybody an insight into what's going on in our, in our
world. Again, thank everybody for joining us.
And please leave the leave comments, because as much as we
want to give you an insight into our world, we want an insight into yours and
that's how we all grow and get through this together. Insight both sides.
want to give you an insight into our world, we want an insight into yours and
that's how we all grow and get through this together. Insight both sides.
Oh. And don't forget to like, and share. Subscribe.
Alright.
Alright.
Hey Bill and Jonathan, Great job guys. Great job.
Thank you very much. Thank you. Thanks again for joining
us guys. Thanks guys. See you next week.
us guys. Thanks guys. See you next week.
-----------------------------------------------
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