TM I N FORM . I NS P I R E . E DUCAT E . EMPOWE R .
Clearing Skies The best bets for good growth MARKETS & TRENDS
The Power of Partnerships STRATEGY
Reigning Real Estate THE APARTMENT QUEEN, KAYLEE MCMAHON, EMPOWERS FEMALE INVESTORS
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2 | think realty magazine :: january – february 2022
PUBLISHER & CEO Eddie Wilson
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FULFILLMENT COORDINATOR Blair Pierce
DESIGNER David Rodriguez
CONTRIBUTORS John Beacham Jenifer Calandra Grant Cardone Jason Engelman Arianne Lemire Jeremy Kloter Taylor Miller Kathleen Richards Sarah Shellam Greg Slaughter Brian Snider Michele Van der Veen Ingo Winzer Michael Zuber
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CONTENTS
INSIDE THIS ISSUE
14
COVER FEATURE
Kaylee McMahon reigns in multifamily real estate by empowering female investors
THE APARTMENT QUEEN
by Kelli White
4 | think realty magazine :: january – february 2022
THINK REALTY
34 Ready to Not Go Solo? What to consider as you grow your business by Brian Snider 36 Growing a Strong Leadership Team What we can learn from our successful and our failed partnerships by Jeremy Kloter
6 News & Events
INVESTOR STORIES
8 Local Real Estate Investors Improve Communities One House at a Time A story of one Newark investor making a difference by John Beacham
38 How to Use Real Estate to Give Yourself a Raise by Jeff Roth
42 A Partnership Close to Home
12 A Woman to Watch: Eboni Killian Shining a light on some of the many bright women in the REI industry by Kelli White
by Greg Slaughter, a Think Realty Resident Expert
44 Sustaining Partnerships 3 tips when working with your spouse in real estate investing by Arianne Lemire 48 How to Pay Yourself Now and Pay Yourself Later with Partnering Building wealth—and your network—with
FUNDAMENTALS
22 The Power of Partnerships Scaling your business takes more than yourself by Grant Cardone
partnerships by Sarah Shellam
24 Instagram-Worthy Staging and Photography Beautiful photos drive buyers to the door by Jenifer Calandra 28 What Does Leadership for a Property Manager Look Like? Learning to apply leadership attributes to get results by Kathleen Richards
DESIGN POINT
52 The Stage and Sell Partnership It takes teamwork to sell a fix and flip
for the best profit by Michele Van der Veen
MARKETS & TRENDS
30 Contractual Unity in a Volatile Market Navigating a build constructively by Taylor Mille
60 Clearing Skies
The best bets for good growth by Ingo Winzer
STRATEGY
62 Hot Market: Atlanta A city with incredible upside for investors by Marco Santarelli
32 A Different Partnership Are you ready to establish a solid partnership with your future self? by Michael Zuber
68 Cincinnati Market Report by Jason Engelman
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THINK REALTY
NEWS & EVENTS
Think Realty and AAPL’s Virtual Day on Capitol Hill
M
which Congress adopted in 1982 “to simplify existing rules and regulations to facilitate capital formation, particularly for small businesses, consistent with the protection of investors.” AAPL and Think Realty’s position is to strike Section 138312 and 138314 from the federal tax bill, which if passed, would force self-directed IRA accountholders to move from private to public offerings. Beyond this urgent matter, ongoing topics discussed included Affordable Hous- ing, Opportunity Zones, the Home Mortgage Disclosure Act, Bankrupt- cy, and more. AAPL and Think Realty are owned by Eddie Wilson, an experienced real
embers of the American Asso- ciation of Private Lenders and
estate investor and private lender with a track record of successful business ventures and nonprof- it organizations worldwide. “It is important to establish who we are and how we can be of service to legislators. We take a consultative approach, and our methodology is one of advocacy,” he said. Policymakers were responsive to concerns and the event’s 11 meet- ings with legislators on both sides of the political aisle helped raise awareness for the real estate invest- ing and private lending industries. Staff requested additional informa- tion that would help them better understand these issues and the plight of their constituents. •
Think Realty gathered virtually for a day of meetings with staffers in Washington, D.C. to discuss proposed legislation that would impact housing providers and private lenders. In 2019, each company organized an in-person Day on the Hill event and members were excited to contin- ue the discussion that successfully began two years ago. The purpose of Day on the Hill is to explain what housing providers and private lenders do for the real estate industry and to voice the impacts proposed legislation would impose. The specific mission this year was to Save Regulation D,
6 | think realty magazine :: january – february 2022
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INVESTOR STORIES
COMMUNITY
Local Real Estate Investors Improve Communities One House at a Time A STORY OF ONE NEWARK INVESTOR MAKING A DIFFERENCE
by John Beacham
8 | think realty magazine :: january – february 2022
ocal real estate investors across the country are uniquely
L
By specifically focusing on afford - able housing, real estate investors often generate secondary and ter- tiary benefits for the communities in which they operate and are critical to the affordable housing solution as they are on the ground in under- served areas and have visibility into each neighborhood’s unique back- ground, obstacles, and solutions for improvement. They can often shorten the learning curve for the ultimate home buyers with respect to credit improvement and the benefits and opportunities of home ownership. One such investor is Mohin Abedin, who is intimately familiar with the need for affordable hous- ing – and has been committed to a solution since he was 19 years old. Raised in Elizabeth, New Jersey by his father, an immigrant from Ban- gladesh, Mohin grew up seeing low- er income families being gradually pushed out of neighborhoods that for generations served as starting points for minority groups and immi- grants from Asia, Africa, the Carib- bean and Latin America. He espe - cially took note of nearby Newark, a city that has been experiencing a rapid transition from low-income rentals to higher priced units – dis- placing long-standing communities with no path to affordable options or home ownership. Having taken an internship while enrolled at Farleigh Dickenson University with a real estate finance firm, Mohin decided to take matters into his own hands. Not willing to wait, he dropped out of college and started his own home renovation investment business. To date, Mohin has deployed more than $3.6 million to rehabilitate and stabilize 23 homes in Newark, typically for families with an aver- age household income of $44,000
Real estate investors
positioned to help alleviate the sig- nificant shortage of homes available to low- to mid-income families. They work closely with private lenders and capital providers who enable and encourage the delivery of updated affordable housing. The severe lack of quality afford- able housing in the U.S. market is unmistakable. A National Association of Realtors report shows new hous- ing construction in the U.S. over the past 20 years fell 5.5 million units below historical levels, and in the past decade, new home construction fell 6.8 million units short of what is needed to meet household forma- tion growth and normal reductions to housing inventory. The data also shows that for every 100 low-income households, there are only 37 afford- able and available rental homes. While the pressure placed on those in need of affordable housing options was already immense, the COVID-19 pandemic only made the problem worse for those in need of affordable housing as the sudden and sustained flight from city centers combined with new migration pat- terns to raise prices on homes that were previously accessible to those with lower incomes. But with challenges come oppor- tunities. Local investors, with their grass roots insight to the local markets are able to meet the hous- ing needs of their communities by improving outdated housing stock, converting industrial and retail prop- erties into residential units, con- verting single-family properties into multifamily properties, and starting new ground-up construction. In turn, they create additional opportunities for members in their communities by hiring local and promoting economic activity in the areas where they invest.
are critical to the affordable housing solution.
(well below the U.S. national average of $78,000). His investment almost doubled property values – from an aggregate of $3.8mm to $6mm with- in an average of one year. But Mohin’s returns are measured in much more than simple dollar amounts, and what sets him apart is his focus on the local community. Mohin understands that renovating previously dilapidated homes can not only have a positive impact on resi- dents and the overall aesthetic of the neighborhood but can also serve as a springboard for broader community engagement, employment, and edu- cation about upward mobility. Instead of looking outside the community to realize higher rent or resale value, Mohin actively seeks out members of the Newark community in need of affordable housing, par- ticularly historically disadvantaged groups such as immigrants and per- sons of color. In most cases, Mohin rents his rehabilitated properties and remains engaged with his tenants as a way to educate them on the process and merits of home ownership. He provides credit counseling, financial planning, mortgage brokering and other services that enable tenants to improve their financial standing to the point where they may remain in their homes as first-time buyers. For each project, he makes an effort to hire locally at every level,
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including skilled labor and crafts- man to conduct the renovation itself in addition to ancillary work including clean up, landscaping, debris removal and property secu- rity. Thanks to his efforts, Mohin has seen immediate and significant improvements to neighborhoods in Newark following these renovations and continues to expand his engage- ment by interacting further with the local community.
Investors like Mohin need ready access to capital to fund their proj- ects, and experienced partners offering predictable loan structures and underwriting to meet the timing and transaction needs of the mar- ket. These could be bridge loans for rehab or non-rehab projects, ground up construction loans, intermediate loans or long-term loans. Toorak Capital Partners works with lenders across the country, who in
turn provide loans to investors like Mohin. Once local lenders have issued these loans, Toorak purchases them, freeing up capital for more loans to local entrepreneurs, who in turn work on more projects that increase hous- ing inventory. This sustainable flow of capital equates to more engagement in disadvantaged areas, more home ownership, and improvement in over- all quality of life based on organic, community-focused growth rather than gentrification. Toorak funded Abedin’s work in Newark, which is just one part of the company’s larger impact on the affordable housing market. Since 2016, the firm has funded over $7 billion of loans for thousands of real estate investors across the country, who have renovated or stabilized approximately 30,000 units for fami- lies. Over 85% of the units funded by Toorak’s bridge loans are considered affordable, with the average value per unit of less than $400,000. These investments – and the local entre- preneurs like Mohin workings on projects – serve to help communities and residents by providing new and improved affordable housing, repair- ing unsafe or unhealthy housing con- ditions, and improving quality of life in under-served communities. •
John Beacham is the CEO and founder of Toorak Capital Partners. Prior to Toorak, John was the founder and President of B2R Finance, the leading
mortgage origination company focused on the single-family rental and residential bridge loan markets. John led Deutsche Bank’s single-family rental lending practice where he structured the first-ever securitization of single-family rental properties. In total, John has completed more than $50 billion in transactions and has structured financings which won CMBS or structured finance Deal of the Year awards four times. John graduated from Princeton University magna cum laude with an A.B. degree in economics.
10 | think realty magazine :: january – february 2022
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WOMEN TO WATCH INVESTOR STORIES AWOMAN TOWATCH Shining a light on some of the many bright women in the REI industry
by Kelli White
Meet Eboni Killian IN2017, Eboni Killian attended a Real Estate Investing Bootcamp. After the bootcamp ended, she hit the ground running and decided wholesaling would be her investment niche. She found her first deal on a FSBO list she purchased from a local list company. The seller had purchased the home at a foreclosure auction and thought he’d be able to do the repairs himself. When the repairs became too overwhelming for him, he asked $48,000 to sell it. Killian negotiated a purchase price of $37,500 then assigned the contract to an end buyer for $40,000. She made $2,500 on her first deal in less than two weeks. Killian was well on her way down the real estate investment road. But as many investors know, the road can be bumpy. Typically successful real estate investors exhibit certain characteristics. Killian attributes her success to being consistent, honest, and persistent. As great as those qualities are, there have also been traits that have held her back. The key is recognizing them and making a change. “When I started real estate investing, I wanted to help everyone,” Killian said. “So, it was very difficult for me to say ‘no’ when people asked me to do things or if I could help do things. Sometimes agreeing to assist took me away from my goals, so I have learned to say ‘no’ and be okay with it if the ask will stretch me too thin.” With the start of a new year, Killian like many of us, is reassessing her REI business and plans to start investing more in multifamily.
12 | think realty magazine :: january – february 2022
DELEGATING Being able to leverage administrative duties has helped me scale my business tremendously. Initially I was doing all of the work -- locating the properties, negotiating the contracts, and selling the property. Delegating some of these tasks has been golden. NETWORKING I intentionally talk about what I do to everyone that I meet. If I can’t help them, maybe they know someone I can help. TRANSPARENCY Being honest and transparent in this business goes a long way. I am honest and transparent about my intentions for each and every property I buy or put under contract. I am honest about the true value of the property and make the best offer that is a win-win for all parties. This has helped me create life-long relationships with all of my sellers. Then they refer me business in the future. Eboni Killian is proving she is a woman to watch in the real estate investment industry. She leads by example and is passionate about helping other women become successful in this business. “It is a male-dominated industry where very few women are afforded a seat at the table. I think women can collaborate more, as well as uplift other great amazing women real estate investors. There are quite a few of us out here doing an amazing job. I seek out women general contractors, architects, etc. and my entire team is comprised of female real estate investors,” Killian said. •
Stop selling. Start helping.” —EBONI KILLIAN
“I’ve been researching the return of investment on duplexes, triplexes, and quads over the past year. It just makes sense to increase cashflow on one unit. I will still invest in single family as well because I want to create more affordable housing opportunities for traditional buyers. Many first-time homeowners are getting outbid on purchases by hedge funds and out-of-town investors. I want to create quality, affordable housing for that first- time home buyer who might qualify for only $250,000 or less,” she said. Killian’s first wholesale deal was pretty successful, and her greatest success story also came early in her REI career. It was a home that had been left to five sisters who had been on the fence about selling their parent’s home. When family matters are involved, it can bring a deal much closer to the hearts of everyone involved. “The oldest sister was my contact person and getting a fair price was important to her. She wanted her and her sisters to get a nice, even share of the proceeds. I bought that house for $35,000 and sold it to a cash buyer who was actually going to live in the property. The buyer came from another real estate agent, and I was able to profit $7,000 as well as pay the commission for the buyer’s agent while still making sure all five sisters got what they wanted. The best part though was meeting all of the sisters at closing and just hearing them talk about their life in the house they were selling.” The best advice Killian has received as a business owner has been to find a niche, become an expert in that niche, and then working in that niche. “Don’t get distracted my the shiny object syndrome,” she said. “This advice has has kept me aligned with my real estate investment goals and has made me a successful business owner.” In addition to that sound advice, here are three strategies or tools within the real estate investing industry that have helped Killian the most:
Look for more women to watch in future editions of Think Realty magazine.
CONNECT WITH EBONI
EMAIL: Eboni@thepeachofpeachtree.com INSTAGRAM:
@thepeachofpeachtree CONTACTNUMBER:
678-860-9408 LINKED IN: Eboni Killian FACEBOOK: Eboni Killian
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COVER STORY
KAYLEE MCMAHON
Reigning Real Estate The Apartment Queen, Kaylee McMahon, empowers female investors
BY KELLI WHITE
14 | think realty magazine :: january – february 2022
SOMEONE’S PAST BEHAVIOR IS ALWAYS INDICATIVE OFTHEIR FUTURE BEHAVIOR. YOU
MUSTTRUST BUTVERIFY.”
KAYLEE MCMAHON
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A FEMALE-FOCUSED LEADERSHIP TEAM
OFTEN, THE PATH TO SUCCESS STARTS WITH ASKING QUESTIONS.
K aylee McMahon, known as The Apartment Queen, started her journey in multi- family real estate investing by asking the right questions. And although she relied on curiosity in the beginning, she soon realized the person giving the answers is just as important as the questions she was asking. McMahon knew her curiosity would serve her well and she wasn’t afraid to ask and learn. But what she wishes she had access to when she began her real estate investing journey was a female mentor. “All the men who helped me in the beginning were great. I have noth- ing against them, but women deal with life experiences from a different lens and know how to navigate cer- tain challenges that only females go through. Having someone understand your viewpoint really helps,” she said. She now sets out to be a lens for other women in the industry. And what she has seen through that lens in her four-year REI career has been eye-opening. For McMahon, work- ing with mentors, finding partners, and helping other budding investors comes down to not only trust, but verification. McMahon began actively invest- ing in flipping a rental and passively investing in a house note. “I didn’t have enough money to invest in large apartment deals, but I had a small IRA and invested with a group on a house note before getting into multifamily.” Now, four short years later, her businesses are thriving. What other
industries can take you so far so fast? “Maybe tech,” she said. “But that depends on if you have a unicorn idea and stick to it. Unicorns are not born every day. Real estate is amaz- ing that way.” But anything amazing almost always comes with tough lessons. LEARNINGTHEHARDWAY McMahon, like some real estate investors starting their business- es, found herself in a bushel of bad apples. People in the industry talk about bad actors and the non-trust- worthy individuals. Sadly, every industry has them. McMahon learned this lesson the hard way—twice. Being the type of person who knows how to ask the right questions but also having trusted the wrong people, McMahon’s number-one question became: “Whom do I trust?” “Someone’s past behavior is always indicative of their future behavior. You must trust but verify,” she said. She admits that she naïvely assumed that other people operat- ed like she does—with honesty and integrity and living by the golden rule. “I just trusted. I did not verify,” she said. Had she verified the first bad apple, she would have learned that person had no one to verify their business deals. That person had no track record. “When you’re getting started in the industry, you might not have a track record, but I didn’t spend enough time with that person to learn if they were aligned with where I want-
Deep Paknikar
Erica Neal
Karolina DiMario
Amy Tiemann
Kaylee McMahon encourages her team of forward-thinking females to lead with her actions. “They all have a seat at the table,” she said.
16 | think realty magazine :: january – february 2022
Until you learn a lesson, it will keep coming back to test you.”
KAYLEE MCMAHON
ed to go. I left myself wide open by partnering with someone who had different objectives.” “I wish I’d known you can do a deep search and find active intel to figure out if a character is someone you want in your life. Because their behavior will end up affecting your physical and emotional health.” “This is how life works: you get a tap on the shoulder to help you learn a lesson. Eventually that tap becomes a punch. Until you learn a lesson, it will keep coming back to test you. In each lesson, I was desperate and rushed to make decisions and landed in a place where I needed rescued. I allowed a scary situation to drive my behavior.” Now, she waits to respond, thinks about it, and does not decide based on fear. “At the end of any scary experi- ence: extorsion, threats, or whatever, I remind myself that my legs are still attached! When things are complete- ly out of hand, go to your backyard and feel your feet in the grass. It truly helps. Feeling physically connected to the earth has been a huge healing process for me and keeps me pres- ent,” McMahon said.
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18 | think realty magazine :: january – february 2022
McMahon’s company name is Apartment Queen Investments, which owns around 1,000 units in Texas and Arizona, but she quickly trademarked “apartment queen” because she learned there was demand for the name, so she jumped on making it hers. Two criteria topped McMahon’s list when figuring out her brand. And the list was devised by asking herself another question: “What is important to me?”
I believe in justice and doing the right thing. Keeping people accountable is very important.”
KAYLEE MCMAHON
spawned her start-up company, Big Sister Security, which is in its infancy phase. The focus is to learn sub- stantive information about someone before doing business with them— find out how someone is motivated, their business history, their person- ality traits, their past business rela- tionships and transactions, services not delivered, links with crime, bad deals, etc. Being able to find that information is where her search started because she needed data to have leverage and protect herself. “When you’re in a situation when it’s your word against theirs, you need that empirical data,” she said. “I believe in justice and doing the right thing. Keeping people accountable is very important.”
1. Get people’s attention 2. Be feminine-focused McMahon’s passion for working
THE DATING GAME OF PARTNERSHIPS
Whether you’re in a syndication or a founder/co-founder relationship, McMahon said any type of partnership in the beginning is akin to dating. She advises to find a trustworthy partner and spend a year with them. Travel with them. Get referrals. “When you exhaust doing things on your own, it’s time to ask for help. It’s not how do I do it, it’s who can help me do it,” she said. First, she said it’s imperative to find someone who is active in the real estate niche that you are in. Vet that person by spending time with them to learn if they are trustworthy. But going the extra step— verifying an individual—is crucial. Then, it’s important to evaluate a potential partner’s skills and motivation. “In a limited partner or LPGP structure, you need to find someone to trust long term to take the reins. In joint ventures/Tenants in Common, and co-founder relationships it’s different—everyone has a seat at the table, but you need to figure out each other’s strengths and ensure every- one stays in their lanes and respects each other by not getting in their way,” she said. McMahon’s unfortunate experi- ences with bad business partners
with women in real estate has perme- ated her brand, and it’s a cause near to her heart, rooted in past personal experiences. She wanted “to create independence and space for those experiencing codependency and toxic relationships that hamper their ability to visualize and manifest what their amazing reality truly could be.” The mission of Apartment Queen Investments is “to stop abuse and codependent relationships by provid- ing women with investment oppor- tunities and convenient education about creating wealth through real estate investing.” The notion is to help create financial freedom and a powerful mindset that ultimately leads individuals to find and live their purpose without fear. “Women are more collaborative and more emotionally intelligent. With my abusive past, I need the free- dom of choice and I’ve noticed women are more democratic and open to different perspectives. I’m not the end all, be all to every decision. There are different lenses and in partnerships you need that. I don’t know exactly what the perfect partnership looks like, but our effective leadership has stemmed from empowering women to be leaders,” McMahon said. •
BRANDING BASED ONACAUSE
One in three women are abused in some way whether it be phys- ically, emotionally, or financially. McMahon was one of them and cash-flowing real estate was her way out. Now, she and her company are on a mission to do something about it by empowering women to earn life-changing passive income through apartment investments. “When women are empowered and secured, they are no longer a victim,” she said.
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INVESTOR RESOURCES
TRANSPARENCY
2022’s New Legal Requirement: The Corporate Transparency Act BE READY TO REPORT
by Garrett Sutton, Corporate Direct
are a very serious and challenging loophole within our existing legal framework and that the self-reporting of almost every single entity in the country is necessary to combat this widespread societal scourge.
he U.S. Government wants to know who owns your business. The Corporate Transparency Act (“CTA”)
T
requires, as of January 2022, entities defined as reporting companies to report key information about their beneficial owners. The information will be held in a ‘secure’ data- base maintained by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”). Before this legislation companies did not have an obli- gation to report their true owners. As long as the com- pany paid their taxes there wasn’t much of an issue. But lately numerous law enforcement agencies and others in government have been shocked by an apparent improper wave of money laundering. As a result, every single entity in the U.S. (with only a few exceptions) must annually report their beneficial owners to the federal government or face significant penalties. Not all of the regulations have been finalized but one thing is clear: This law includes every business owner and real estate investor using an entity for asset protection. This law includes you. BACKGROUND The CTA was enacted by both houses of Congress on January 1, 2021, as part of the National Defense Autho- rization Act of 2021. When senators and representatives are asked to approve spending for defending the country and paying the salaries of our fine men and women in uniform you often get a patch work of unrelated bills (that may never be passed on their own merits) attached for the legislature ride. The CTA relates not to boots or bat- tleships but to money laundering. Specifically, the CTA is an amendment to the Anti-Mon - ey Laundering Act of 2020, and it seeks to discourage the use of ‘shell companies’ by mandating the transparency of every entity newly formed or already in existence. Con- gress has determined that anonymous shell companies
REQUIRED REPORTING A reporting company obligated to report annually to FinCEN is a corporation, limited liability company, limited partnership or similar entity which is chartered by filing with a secretary of state, tribal office (or comparable commission) or is formed in a foreign country and quali- fied to do business in the United States. Beneficial ownership under the CTA is defined as any individual who directly or indirectly (i.e. through a second entity) exercises substantial control over an entity AND owns or controls at least 25% of the ownership participa- tion (i.e. stock or membership interests) in the company. The information required for the reporting (as of this writing) of beneficial owners includes: • Full Name • Date of Birth • Current Residential or Business address; and • A unique identifying number from a state-issues iden- tification document (ID) This may include a passport, driver’s license, or a FinCEN identifier. Given legitimate concerns about the privacy of such information, it is claimed that the FinCEN database will feature strictly limited access. Those with entry will be federal agencies (the FBI), non-US law enforcement (Interpol) and state and local law enforcement agencies with a warrant. Many of our clients set up Wyoming LLCs for their privacy features. The Wyoming Secretary of State does
20 | think realty magazine :: january – february 2022
not list the names of LLC managers or owners on their website, nor do they collect such information. However, FinCEN will collect this material for their secure data - base. Will it stay confidential?
PENALTIES The government wants you to report, as is evidenced by the penalties. Civil penalties for failing to report are $500 per day. Willfully failing to report or providing false information can result in criminal fines up to $10,000 and/or two years in prison. Hacking or misusing the FinCEN database (an interestingly anticipated worry) includes criminal fines of up to $250,000 and five years in prison. The penalties for failing to report are significant. Of course, you can handle this filing on your own. But many of our clients prefer our assistance (such as with our service for annual state fillings and minute preparations to avoid a piercing of the veil). Many clients prefer our help so that they can do whatever they do best to manage their business and investments. In the coming weeks (as we learn the new regulations) we will provide our clients information on how Corporate Direct can assist to meet the CTA’s annual filing requirement. To stay up to date on this important new filing requirement feel free to subscribe to our newsletter at https://corporatedirect.com/sign-up-for-our-newsletter/. •
EXEMPTIONS Some entities will be exempt from the reporting require- ment, many of which already report pursuant to existing government regulations. The exempt entities include: • Publicly traded companies (subject to SEC regulations) • Companies employing more than 20 full-time employees in the United States, operating from a physical office in the United States, AND having filed a tax return demonstrating more than $5 million in gross receipts/sales. • Dormant companies which have been in existence for more than one year, are not engaged in “active business,” AND are not owned (either directly or indirectly) by a non-U.S. individual. • Additional exceptions apply to certain financial insti - tutions and charitable trusts.
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FUNDAMENTALS
ALLIANCES
The Power of Partnerships SCALING YOUR BUSINESS TAKES MORE THAN YOURSELF
by Grant Cardone
have been running businesses and investing in real estate for
worried about keeping my market share, my clients and intellectual property to myself. I didn’t want to be vulnerable to others taking advan- tage of me. I had a scarcity mindset where only a few could prosper. Well, I have since realized that
that concern is completely unwar- ranted and is in fact, backward. Not only that, it kept me from scaling at the rate and heights I could have attained much sooner. Now that I have discovered the power of partnerships, I am always
I
over 30 years and I have learned that partnerships are the most efficient ways to scale any venture. I haven’t always felt that way. In the beginning of my career, I was
22 | think realty magazine :: january – february 2022
The bottom line is no one person on this planet has ever done anything great going at it alone.
looking for great alliances to build. One of the ways I have done that is to create Cardone Capital to give every- day investors access to the top level deals I now find available to me. One of the main things I learned was that if you are not an expert at something, you need to either become one or partner with one. As much as I have found partnering with others valuable in my train- ing, licensing and event business- es, this fact is especially true in real estate. There is a lot to know in the real estate arena and there are many specialties. There is locating a reputable broker or agent to work with, finding a good piece of property in a great location, finding a lender with favorable terms, negotiating the deal, due diligence, managing the property and knowing when to refi/ exit. Those are just a few of the spe- cialties in real estate. One would be supernatural to be supremely expert in all of those areas. And as I like to say, you can do anything , as long as you don’t try to do everything . That’s why once I closed on my first real estate deal, I hired a good manager for the property. Back in those days there wasn’t enough cashflow to pay a manager a good rate, so I created an equity partner- ship. It was one of the best decisions I ever made. And we both ended up with a great profit on that deal. When it comes to partners, you are looking for quality. You want someone who brings the expertise, capital, skill, or knowledge you lack to the table. That is what makes it worth your while to share your piece. Because you get further together than you would individually. So, you need to make sure your partners are great, not average, not mediocre. They need to bring greatness and excellence where you can’t.
In real estate, it is easy to make mistakes and if you decide to go at it alone, you may not have the ability to foresee those mistakes. This can cost you money, time and resources. Partners bring expertise, funding, and experience to the deals. There are several types of part- nerships. You can join forces with other inves - tors to buy, manage and sell proper- ties. Formation of these partnership entities should involve proper legal and tax advice in order to set out the proper parameters, operating agree- ments, entity creation and company protections in the event of disagree- ments or liabilities down the road. You can be an active partner or a passive partner. One of the qualifying factors I look for in a partnership of any kind is that my partner should do well when I do well. Many so-called partnerships are not built that way. If one side of the partnership just gets a fee, regard- less of the success or failure of the other side, I don’t view that as a partnership at all. I want nothing to do with a “partner” who gets paid whether my money, property, busi- ness, venture is winning or losing. I want to be in a relationship with a business partner that does great when I do great. Someone who wins when I win. Someone who profits, when the venture profits. That’s why I formed Cardone Capital in the manner I did. We find
the deals, negotiate the deals, get the debt, manage the property and we share the fruits of our labor, the cash flow distributions with our investors. When I get a distribution, the investor gets a distribution too. We just launched two funds to acquire four apartment complexes in Broward County, one for accredited and one for non-accredited inves- tors. The minimum investment for the non-accredited fund is $1,000.00. I am proud to create that level of investment class for those who would otherwise be limited to CDs, 401Ks, IRAs and the pitiful interest rates offered by banks and institu- tions today. The bottom line is no one person on this planet has ever done anything great going at it alone. Bill Gates, Steve Jobs, Mohammed Ali… they never made it alone. It takes a great team to achieve star high goals. Do great things and those who want to do great things will find you and want to work with you. •
Grant Cardone owns and operates seven privately held companies, and a $1.8B real estate portfolio as the Founder and CEO of private equity real estate firm, Cardone Capital.
Cardone is also the founder and leader of The 10X Movement and The 10X Growth Conference, which is now the largest business and entrepreneur conference in the world. Moreover, Cardone founded the Grant Cardone Foundation, a non-profit organization dedicated to mentoring underprivileged and troubled youth in character and financial literacy. If you want to learn more about real estate investing in multifamily rental properties, you can find more information at cardonecapital.com.
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FUNDAMENTALS
MARKETING
Instagram-Worthy Staging and Photography
BEAUTIFUL PHOTOS DRIVE BUYERS TO THE DOOR
by Jenifer Calandra
ouse staging and well-com- posed photos go together like
H
STAGINGMISTAKES TOAVOID DECLUTTERING TOO MUCH The real estate agent mantra for staging homes is “declutter.” The biggest mistake amateur stagers — or homeowners attempting to DIY — make is removing too much furniture and too many decorative items. Eliminating too many pieces can make a house feel cold and uninvit- ing. Furniture helps to define a space and provide a frame of reference for room size. Instead of removing too many items from a room, create a more neutral color palette with pops
of color. Visually, this choice reads as less cluttered, while still conveying a sense of home. Items left in place should draw the buyer’s eye around the space, without detracting from the archi- tecture and features of the home. POORLY DONE PAINT AND FLOORING Chipped or sloppy wall and trim paint, stained carpets, or bare wood floors without an area rug to anchor the room will draw the eye away from the quality of the home and discour- age buyers from making an offer.
peanut butter and jelly. A single ingredient just doesn’t hit the spot the same way. A perfectly-staged house without photos — or photos of a cluttered home — won’t cut it if you’re looking to sell a property quickly or start a bidding war. Follow these professional tips to stage residential properties like a pro and photograph them like an Instagram influencer to attract buyers and bring in a multitude of strong offers.
24 | think realty magazine :: january – february 2022
many digital cameras, so even a photography amateur can succeed in producing Instagram-worthy images by following these tips from professional photographers. GENERAL TIPS • Try photos with and without your flash turned on. • Hold the camera straight and parallel with the floor. If you struggle with this, use a tripod. • Shoot photos at eye level. • Take more photos than you need, so you can choose the best ones from many; otherwise, you may find that you’re stuck with lack - luster options. • Color-correct and adjust the white balance in photos as nec- essary before posting to Insta- gram or the MLS. TIPS FOR REALTY PHOTOGRAPHY • Before taking photos, walk
around the house to get a feel for the flow and which areas and angles would create the best photos. • Shoot photos in daylight. This is when natural light will be brightest inside a home. How- ever, shooting exterior photos at twilight with all interior lights on can create atmospheric, dra- matic images. • Capture standard photos to share online, including two wide-angle shots of each bed- room, the kitchen, and the living room; one bathroom photo; up to three photos of the backyard; and one photo of the laundry room, garage, or other special features. • Skip photographing the inte- riors of closets unless they’re remarkable in some way. • Move objects out of the way to capture the best vignettes, if possible. POSTING ON INSTAGRAM There’s a secret formula for posting home photos on social media to get views and engagement from your target audience. The most beautiful image in the world won’t garner the attention it deserves without follow- ing these tips. • On Instagram, use three to five hashtags that are relevant to real estate and the home you’re selling. Don’t overdo it; less tru- ly is more. • Opt for carousel posts — ones that let the user scroll through multiple images. They get more engagement than single images or videos on your Instagram grid. • Post consistently. Your followers and target audience expect to
Repainting or touching up paint, having carpets professionally cleaned, or adding an inexpensive area rug are easy solutions. LACK OF CURB APPEAL Everyone sees the exterior of a home, so curb appeal is vital. Make first impressions count by dressing up the front of the home for sale. But you don’t have to go overboard. Start by removing any dead foli- age and raking up leaves or oth- er debris. Seasonal potted plants make a statement without digging, and upgrading exterior lighting is a fast way to bring a dated home exte- rior into the modern era. Stow tools and garbage cans inside a garage or shed to keep the focus on the house and create a sense of adequate storage.
PHOTOGRAPHYTIPS Modern smartphone cameras take higher-quality photos than
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see you in their feeds. Show up for them. • Write your posts for your ideal follower. If you post for every- one, you post for no one. Speak to your audience directly. • Don’t include a call to action on every post, and remember that URLs don’t work in Instagram posts. • Try posting to Instagram Reels using trending sounds. An engaging hook will help your vid- eo catch on.
BUILDASOCIALMEDIA STRATEGYAROUND BEAUTIFUL IMAGES
Jenifer Calandra’s decade of marketing experience in a range of industries gives her a unique perspective on strategy. A professional writer by trade, Jenifer crafts the story of your brand to positively affect your website’s search engine optimization and authority with your target audience. Kansas City according to The Pitch , iFocus serves clients around the country, with extensive experience in property management and real estate marketing. • A digital marketing agency can guide you to an effective social media strategy that incorporates the Instagram-worthy photos you took of those beautifully staged homes. And bonus: these images will drive traffic to your real estate website, and ultimately to the hous- es you sell. Partner with an agency that pro- vides you with in-depth analytics that illustrate the return on your investment. iFocus Marketing helps clients achieve measurable busi- ness outcomes through meaningful marketing strategies and analysis. Voted Best Marketing Agency in
This picture is ideal for illustrating shooting in daylight and from eye level.
This picture illustrates using a neutral color palette and leaving the area rugs down to anchor the room.
26 | think realty magazine :: january – february 2022
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FUNDAMENTALS
LEADERSHIP
What Does Leadership for a Property Manager Look Like?
LEARNING TO APPLY LEADERSHIP ATTRIBUTES TO GET RESULTS
by Kathleen Richards
e’ve all attended leadership keynotes, workshops, and webinars. We are motivated by the presenta- tions but in practice what does leadership look like in the real world? In the book Good to Great they outline the attributes of a good leader which include being humble, supportive, a good communicator, coach, caring, demand- ing but fair, respected, a good listener, and someone who knows how to hire and let people do their thing. We all know what a good leader looks like and doesn’t look like, so why is it so hard to be a good leader? How do we apply W
leadership attributes to get the results we are striving to attain when we are just trying to keep our heads above water, manage staff, grow the business, and make a profit? It isn’t easy. Here are five real world tips to implement change through leadership.
1. TELLASTORY Doesn’t everyone like a story? Stories are powerful because they create a picture that everyone can relate to
28 | think realty magazine :: january – february 2022
and understand. A story grabs us emotionally. Share your story and your why for starting the business, your dream, and the steps along the way to today and communicate your vision for the future and how everyone has a role to play. Paint the picture in detail, clearly, and if some things are unknown that is ok…admit you don’t know how you will get to the goal, but you know with everyone’s help and hard work all of you will get there together. 2. ASK FOR HELP You may have the dream, but you don’t have to have all the answers. Ask for help. This is a huge problem for many executives and business owners. There is a feeling that everyone is looking to you for direction and the answers. Yes, they might be looking to you to lead the way but reach - ing out to your team for the answers or how to support them to achieve the goal is the easiest way to gain respect, build momentum with your team, and get everyone rowing in the same direction. People want to do work that matters. They want to feel that they are contributing to the success of the business. People want to be part of something big- ger than themselves. Being vulnerable is a leadership skill that few are willing to exercise. It will feel uncomfortable after all that is what being vulnerable is all about. 3. COACH Leadership requires us to develop our team so they can excel, grow their skills, knowledge, leadership abilities and ultimately create a career path for them so they are an integral part of the business’ success. This means coach- ing them. Taking the time to train them instead of just tell- ing them what to do. Yes, it takes time but creating leaders is worth the investment for your future success. Success doesn’t happen overnight. If you care about your people, you will invest the time to develop them and in return you earn their respect and loyalty. They will buy into your vision and will work to make it happen.
Article provided by the National Association of Residential Property Managers (NARPM) and written by Kathleen Richards, MPM®, CPC. Kathleen knows firsthand the highs and lows of being a business owner. She is a nationally recognized coach, speaker, instructor, author, and thought leader for the last 30 years focusing on business, leadership, and specifically the field of property management. She owns PM Made Easy – customizable products to streamline operations and founded The Property Management Coach. She can be reached at 800-475-3084 or Kathleen@ThePropertyManagementCoach.com. NARPM® members receive information like this article every month through its news magazine, Residential Resource. To join or learn more, visit NARPM.org. YOU CAN BE IT You can be the leader your business needs to thrive. Ask yourself, “What does my business look like in a year, in five years? Let yourself dream. Don’t get stuck in the logistics. Paint the picture of your ideal business. Tell your story. You have a compelling story for why you got into property management, why you started your business and where you want to take it in the future. Ask people including your team of advisors for help and how you can support them. Most importantly be human, and humble. If you truly care about your people and your business you don’t care who gets credit, you want everyone to succeed. It isn’t about you. It is about providing the best product or service pos- sible with the best people delivering exceptional customer service that will lead to incredible profits and a workplace that is healthy and the envy of others. • kids, you know all too well that when you start to speak or try to educate your kids on a topic, they roll their eyes and are dismissive. Employees are no different. Some - times, having a different messenger will make the impact you are seeking. The point is to find ways to communicate regularly and remind everyone why you are doing what you are doing. People don’t buy in until they see the benefit to themselves. 5. TEAMOFADVISORS Even if you are a one-person business, it is your respon - sibility to seek out advice and get educated so that you are making informed decisions about your business. Everyone needs a team of advisors. Large companies have a board of directors or executive board. Your team should include advisors such as an attorney, CPA or tax specialist, banker, insurance expert, HR consultant/attorney once you start hiring, a business coach or colleague to act as mentor, and financial planner – you don’t want to be collecting rent when you are 90 years old!
4. COMMUNICATE, COMMUNICATE, COMMUNICATE
In real estate we hear the phrase, Location, Location, Location. Being a leader in the real world means commu - nicate, communicate, communicate until you are blue in the face. Keep in mind as the leader it doesn’t mean you have to be the spokesperson every time. I found value in bringing in colleagues to teach and share their expertise. Hiring a business coach can be helpful, too. If you have
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