My Realty Gains
Taylor is on a mission to teach busy professionals how they can invest in real estate without dealing with tenants, toilets, and termites. His goal is to help his listeners and investors build lives of abundance and escape the Wall Street Casino. He believes that building passive streams of income is the best path to wealth generation, not the typical, boring, “Don’t have that $4 latte you enjoy twice a week.” Enjoy your latte and buy some property!
What are the different ways of Investing? What are the benefits of Investing?
How does syndication help investors to invest passively and build their wealth?
How should people find investments? How can they find 506B or 506C investments? What should be their approach?
How to approach any New Investor and what strategies are the best?
Prashant Kumar, CCIM – What are the different ways of Investing Besides just getting into those grunt work, toilets, tenants, and termites. What are the different ways? How do you help investors to get into those ways and What are the benefits?
Taylor Loht – There are many ways to do it. I invest in Real Estate syndications, and I help bring people into those deals that will passively invest with us. We buy multifamily and self-storage primarily but there are many other types of asset classes you can invest in that are not the only ones and not everybody wants to give up control and invest passively with an experienced partner.
What we do in Real Estate syndication is we want to help people learn about what’s out there. I don’t want to tell you what’s right for you. I want to help you find the information. There’s note investing. People buy mortgage notes from banks basically at a discount, get them performing better and sell them off for later more, or live on the cash flow and the debt payment there.
Lending is a big one, hard money lending, basically lending money to flippers. But the big caveat there is if you’re going to get into lending money, you need to know what you’re doing. It’s a high-risk strategy to get into, especially if you’re a new real estate investor because it’s probably going to be a pretty big check and if you don’t have experience as a flipper yourself working with fixing up properties, you might not know what to look for or what to avoid and things along those lines.
Another popular strategy is the space of passively investing. But keeping control is a turnkey property. There are turnkey providers out there who will find properties that are in disrepair. They’ll fix them up, put a tenant in there, they will put property management in place, and then you buy the property from the turnkey company. There are reputable turnkey providers out there, and there are disreputable turnkey providers out there. So that’s another area where if you’re thinking about going that route, really need to dig into the lessons around how to do the due diligence on the properties and the turnkey providers and all those things. That’s a huge topic. But there are sufficient to say there are numerous options out there, you just have to learn about them, and then you’ll likely find one that works for you.
Prashant Kumar, CCIM – How does syndication truly help investors to invest passively and build their wealth? Share your perspective on this.
Taylor Loht – Syndication is when you have a group of investors that come together and buy a property together, but not all of them are running the property or running the business. Only a handful of them are running things, and everybody else is just a passive investor. They get to participate in the investment in a piece of property and get to leverage the experience of the active or general partners who are in the deal, running the property, finding the property, getting all the debt, and doing all the heavy lifting.
The passive investors are just along for the ride but it would be irresponsible of us to not mention, that there are risks involved there. Do you need to know that the general partner knows what they’re doing? Have they done it before? Are they going to behave ethically? Did they underwrite the property? Well, which just means that they do the math, right? Did they project the future cash flows and values properly? Did they get the appropriate debt, all these things that are involved? Because when you’re buying a 200-unit property or 225-unit, you’re buying a business. You’re trying to increase the value of the business, and it is a business based around a piece of Real Estate but I kind of like it more to surgery If you’re going to get a particular surgery.
I just saw one of my mum’s twin sisters today broke her wrist, so she’s getting surgery on Tuesday to repair her wrist. Well, she’s getting surgery from somebody who’s done it before.
It’s the same thing with a Real Estate Investment, a syndication Investment. Have they done it before? Are they going to do a good job? That they behave the right way is all very important in investing in this strategy.
Prashant Kumar, CCIM –
How should people find these investments? These are five or six B most of the time. I mean investments where there’s a personal relationship and stuff like that. How do you help them to find you or others for good investments? What should be their approach?
Taylor Loht – I’m going to dig right into that, to kind of respond to your long working hours and things. One of the reasons that I was inspired to get into the Real Estate Industry and business and help people passively invest is because I come from a family of very hard workers.
My parents work very hard, my dad is in it and I watched my parents go through the great recession many years ago. I was in college at the time and my dad was working. He went from working 10 hours a day under pre-Great Recession conditions to working all the time. I mean, he might have slept 4 hours a night at the most, but other than that he was working all the time trying to keep his job because they were firing everybody and here we are in 2022 and he still works hard all the time. My goal in this business is to be inspired by watching them. But also how can I help other people to invest in this space too?
I’ve seen that firsthand, so that’s why I got into it but anyway, to address your question about how to find people to invest with, it’s a big question and it’s not as easy as going to Google, punch in, with whom can I Passively Invest in Real Estate, and then go invest with them. That would just be reckless, frankly. Doing your due diligence, and finding the right people is important.
Now, there are things like this podcast that your listeners are listening to right now, listening to us. Now, just because you heard us on a podcast does not mean you should go and invest with us or anybody else that you hear on a podcast. But it’s a jumping-off point. Go and learn more about the people that you’re hearing on the podcast.
For example, again, being a jumping-off point, google them, look up their companies, and see if you can find organic references. Can you find somebody that’s invested with them before and learn about their experience? Can you look up their profile, those kinds of things?
With whom you are investing they would just be reckless. Finding the right people is important.
First, the most important thing is to understand the ethics and the reputation and the experience of the person who is arranging a critical deal. Next comes the evaluation of the deal and that is complicated as well, right? This is where education comes into play and I love my books. One of my favorite books is What Every Real Estate Investor Needs to Know about Cash Flow and 36 Other Key Financial Measures by Frank Galanelli for the number of nerds out there like me, this one will satisfy. It’s not a very long book. It’s pretty thin but I do get into the weeds on underwriting and that will teach you how the numbers work. You don’t need to know how it all works but the responsible thing to do is to understand how it works? and know how to check the math because again if you’re passively investing with somebody in a particular deal, you have to do your research. I understand people are busy and the goal is to passively invest. You are not involved in the back end but personally, in my passive investments with some operators, it took time to get here but I’m now at the point where these operators that I invest with, I’m in they send me a deal. I look at it, but I know them, I know their experience. I’m going to evaluate the deal to see if it’s a yes or no, but it’s probably going to be a yes because I know them and their experience and reputation I’ve invested with them before. There’s a lot of check tracks, there’s a lot of these things that you have to do consistently over time but once you do them, you get more experience with them, you get more comfortable and you build up experience with these sponsors it just becomes so much more fluid there will be time investment on the front end to find the people to do deals with but on the basis back end you’ll be glad you did and you’ll get a lot faster at it too.
Prashant Kumar, CCIM – How are you helping Investors? How do you approach anybody new? What is your strategy? What is your sales pitch? Just share your experience or your strategy?
Taylor Loht – Sure for me and my business and bringing people into our deals comes down to making sure people are the right fit. Their goals are in line with the deals that we do and what they offer and the things along those lines for folks that are more generally getting started in their Real Estate Investing experience and building up and not sure which way they’re going to go.
There’s my podcast, the Passive Wealth Strategy Show, which is very similar to yours, and we go into a lot of those topics and I always bring on a lot of more active real estate investors. I’m always trying to translate their lessons to busy professionals who are just kind of getting started. And to go back to the beginning of my bio, you mentioned my little phrase about inflation is screwing up my number there.
I need to update the dollar figure. But I say don’t skip the $4 latte you enjoy twice a week. Go buy some property, build up some cash flow, and expand your means is a phrase that’s common in this industry. Maybe I need to change that to an $8 latte. I drink black coffee, cost. But that was one of my frustrations with typical financial education out there. For other content that I put out, I’m just putting out now a seven-day course.
It’s free of red flags in Passive Real Estate Investing, and very much tailored toward the syndication space because that’s my main experience in real estate. Folks are interested now. Once again, it’s free at Passive Real Estate course.com that’s out there. And we’re always going to keep working at that and keep making that better. I’m doing my best to make that information-dense accessible and useful for people when they’re going out and looking at deals. I was just trying to put knowledge out there and associate with great people.
Prashant Kumar, CCIM – This is a very good point.
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