by | 06, Oct 2022

Best Ever Apartment Syndication Book | Deep-Dive

This book might be the most influential in starting our careers as real estate investors. It is THE perfect guide to syndications and raising capital… well except for Passive Investing Made Simple! But, this book helped shape who we are as investors. It provides a step-by-step system for completing your first apartment syndication deal and building a multimillion or multibillion-dollar apartment investing empire.

Remember, with each episode, we will provide a helpful Deep-Dive infographic where we break down the entire book on to 1 page! And we have a convenient link for you to find all of them! Visit invictusmultifamily.com/notes to find all of the sophisticated investor notes!

Here are our top 9 takeaways:

  1. Branding Is Essential (05:00)
  2. Ebb And Flow Of Expectations (08:30)
  3. Team You Need (11:00)
  4. Get A Coach (13:00)
  5. Finding And Analyzing Deals (16:30)
  6. Title Companies (19:00)
  7. 3 Laws Of Investing (21:00)
  8. Cash Reserves (23:00)
  9. Asset Management / Property Management (26:00)

“If you’re going to get to the point where you’re gonna raise capital from people and they’re gonna trust you with it, and you’re gonna go out there and try to generate returns, I think this should be your only game. ”  – Anthony Vicino

“I’ve seen a lot of green syndicators rush out and say “I’m Dan Krueger, an operator” and not really stop to take the time to build a brand. Branding is essential.”  – Dan Krueger

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five rules of investing

The Five Rules of Investing

** Transcripts

Book Deep Dive

[00:00:00] Anthony: And today we’re gonna talk about what I think might be. The, the book that was the most influential for me when I started off on the journey and thinking about syndicated raising capital and branding P investors and doing everything that we do now. Um, this book, when I read it, I was like, Oh, this is the playbook.

It’s the step by step. Do this, bend this, bend this, and you’ll have that. Mm-hmm. , and I’m curious. , what were your thoughts when you first read this? So like at what point in your journey did you read this book? Yeah, I

[00:00:49] Dan: read this pretty early on. Um, I, I was trying to remember actually when exactly I read this for the first time, but I think it was right around, uh, when I was doing, I think it was like [00:01:00] between like the last jv, before the first indication.

I wanna say I read it before we did that first syndication. But I cannot remember exactly. Mm-hmm. . But it was really interesting going back, uh, you know, kind of rereading it now from a much different perspective being actually experienced. Yeah. Because I went to it for, uh, guidance because this is, like you said, a really good, uh, framework for here’s how to syndicate a deal.

Yeah. Um,

[00:01:26] Anthony: and so like for the listeners at home that are just like tuned into the podcast and they’re just binge listen. The today we’re gonna be doing our book, Deep Dive On the Best Ever, What is it called? Best Ever Syndication book. Best Ever Apartment, Best Ever Apartment Syndication book by Joe Fearless and Theo Hicks.

Those are the guys over Ashcroft Capital. They also have a great podcast, best ever. Um, and this, this book is okay if you’re a passive investors, This book is not for you. And if you’re not interested in building a syndication investment company, uh, this book is not for you. So pretty much if, if, [00:02:00] if I’ve just described.

Somebody that you are, uh, then you can just tune out. Mm-hmm. . Just don’t even listen to the rest of this. Don’t even bother with this book. It’s not gonna be helpful to you. However, if you’re listening to this and you’re thinking about being an operator, you’re interested in what syndication means. Even if you’re not going to go and raise capital and do this, like you just wanna learn more about the model.

I think this is the best book, truly that I’ve ever read on. Pretty much every aspect of syndication. Like granted, you’re gonna miss out on a lot of things because it’s a very big field. There’s a lot that goes into a syndication. But for at 400 pages, I think they did a pretty good job of laying out the playbook.

[00:02:38] Dan: Yeah, I, I was thinking that too, because like I said, first time reading this, I was trying to, you know, wrap my head around how to effectively structure this kind of thing. And now kind of going back, reading it as a more experienced operator, um, I will say that it, it, it touches on everyth. And there’s definitely parts in here that, uh, you know, warrant an entire book in and of themselves, which I’ll get [00:03:00] into when we get into the takeaways.

Yeah. But it touches all the topics.

[00:03:03] Anthony: And that’s a good point, is like, if you think about all the things that a syndicator has to do between capital raising, acquisitions, operations, asset management, all of that stuff, each of those is really its own book. And, you know, if you’re gonna learn about capital raising, go read, uh, Hunter Thompson’s book, Raising Capital for Real Estate.

If you wanna learn about, you know, being a passive investor, go read our book. Passive Investing Made Simple. If you wanna read. Operations. I don’t know if there’s really a good book out there on the operations side, but I do think this book does a good jobs for where I was at the time to help me understand like from a high level what’s all happening in this syndication, because it, it can, it can feel a bit like a black box.

Yeah. Like you don’t know what goes into it necessarily. Well,

[00:03:43] Dan: it’s, it’s a. Investment vehicle, right? Mm-hmm. , they’re all private deals, so it’s, it’s not like something you can very easily dive into or find the guys who are doing it, especially when you’re new. It’s, it’s a bit daunting.

[00:03:53] Anthony: And one, one thing here before we dive into our takeaways, and I was, I was thinking about this, is that there’s a couple things [00:04:00] in this book that are already dated in terms of like, yeah, on the market you could tell us a product of the time and the certain investment vehicles that really worked at that period.

So like, value add, multi-family, like we love that, but it’s becoming, it, it’s saturated and, and who was this? Another thing that I realized, I was on Twitter the other day, and this guy who has like, um, 200, 300,000 followers did a breakdown of like, uh, a Twitter threat about what a syndication is. And he had like 20, 30 tweets breaking it down.

And in there he, he actually misunderstood and misdefined what common equity versus preferred equity is and what, and that’s, that’s okay. That’s not a big deal on the grand scheme of things. But what it showed me was like, uh, even amongst really experienced operators, There’s still lack of clarity, lack of information, lack of like consistency.

So as a new investor you’re like, Good luck getting caught up. I think a book like this can help you get there, but just recognize that even the, even the professionals, like you’re listening to us, I’m sure we get things wrong all the time. [00:05:00] This is where our legal team, our CPAs, like when we’re giving tax and legal advice, like, Don’t listen to us.

We don’t know what we’re talking about. Mm-hmm. , and, and I think that’s something that to keep in mind with this book is that it’s a product of ITSs time and. The operator was in their journey.

[00:05:13] Dan: Yeah. Uh, I just checked, this was 2018, so about four years old. Yep. Uh, which is actually surprisingly newer than I thought because there were some of the references, um, made around, around like marketing properties and stuff like that.

And, um, you know, the, We’ll get into it. We’ll get it. Okay. Let’s dive in. What’s your first takeaway? Uh, my first one is, uh, branding is essential. Um, I think a lot of people, a lot of syndicators, and I’m pretty much gonna be talking to, uh, the newbie who wants to start doing what we’re doing. That’s basically my audience here.

So I think what I’ve seen a lot of, uh, I don’t wanna say younger, but, but greener, uh, aspiring operators do is, uh, is they, Rush out as Dan Kruger and say, Okay, I’m a syndicate. Here’s who I am, and [00:06:00] yada, yada, yada. But they don’t take the time to really develop, uh, their brand. They don’t have anything that really makes them unique, and they just go out there and start to present themselves as an operator and expect money to just come flow in.

But I think it was maybe two book episodes ago, or. It’s the last one we did basically economics, right? What was that? What was the last one we did? The last one we did, Uh, Thomas so made a point in there that I, I thought was very apropo here, that, uh, your brand gives you a reputation and it’s going to help, uh, keep you accountable to your consumer.

Um, in that book, he was talking about Campbell Soup, he, whatever, but, you know, for this. Your brand is what’s going to, you know, develop a track record for you over time. It’s gonna help keep you accountable so you’re not just some, you know, guy raising capital for deals. You are Invictus. Invictus has values, Invictus has has a niche.

They’ve got a thing they do that they’re really good at. They’ve got things that make them unique. And, and, and that goes a long ways. You can’t, you can’t skip that step. It’s very important. [00:07:00] It takes a long time. Uh, but you’ve gotta get it right

[00:07:03] Anthony: and it’s, it’s an ongoing process, right? You’re constant.

Branding and you’re constantly putting out, uh, intentional development of that brand, right? Like I, I like to think of brand as. Uh, intentional reputation building. So what do you want people to know you as? And again, in this space where these are private placements, which by definition means that there’s not a lot of information out there, there’s always this information gap, this information disparity between the operator and the investor.

And anything that you can do to help bridge that gap and build trust and authenticity and authority, uh, is gonna help. And brand is one way that you can, I think is the best way to do that. But again, it takes a really long time to build. I agree with this. Joe. Joe. Joe, for full disclosure, I think he has got one of the most recognized brands in the space with the best Ever podcast, with their best ever conference.

Ashcraft Capital. I think they’re very well known within a particular niche.

[00:07:54] Dan: Not as much as I would’ve thought, because we went, When was his event? Earlier this year? Maybe like April or something. Mm-hmm. . [00:08:00] Um, after going to that event, I remember telling. Seemingly countless people, uh, that we went to that expecting them to know best ever Joe Fairless.

And I was actually very surprised by how many people who were in the industry were like, And I’m like, really? I feel like he’s one of the kind of OG guys who was out there putting out content. Space. Space. This,

[00:08:22] Anthony: this is one of the things I’ve been realizing about the real estate space. Cause Joe Fairless and Ashcraft, they have over a billion dollars of assets under management.

It’s pretty significant. But then you think about like Chris Powers and Fort, they also have a couple billion, nobody knows who they are. Yeah. What I, what I come to realize is that like there’s all these rock stars that like have local fame within a particular niche where there might be pretty well known, but then when you like zoom out to the macro, it.

Nobody knows who they are. Right. Grant Cardone, Blackstone, like these might be a few of the exceptions. Yeah. But there’s very few like syndicator operators out there that like everybody in the space has heard of at least.

[00:08:56] Dan: Yeah. Well, I mean, and he made the point in the book as well that that’s [00:09:00] actually what you want.

You want selective fame, not general fame. Right. You don’t want like Tom Cruise fame where everybody wants you. You want a very specific audience to know you really. And, uh, you know, that’s good because it’s effective for, for your, for your business plant. But also it’s good because you can go out shopping and no one knows who the heck you are.

And it’s not like you’re a celebrity who has to, you know, worry about paparazzi. Mm-hmm. , that would suck. All right. Here’s,

[00:09:22] Anthony: here’s one of my takeaways is, and this is just like a, a quote that I had pulled from here, but in general, you just saying that when he’s analyzing a deal, his, they, they have to hit an IRR of at least 14% with a five year exit.

What I found interesting about this is this was written back in 2018 and these days, and over the last two years, specifically, if you were to bring investors a 14% base case, five year exit IRR deal, that would probably have gotten really poo pooed. Yeah, right. Like people would look at that cuz what happened is like expectations just got really crazy.[00:10:00]

And so now people are looking like, oh that doesn’t have 20%, 22% irs. Like that’s not anything. So I thought that was interesting was like 14% cuz we underwrite for a minimum of 15 and even then, like we don’t bring a 15% deal to our investors. We usually bring a 16. And that’s our base case. And so it’s just interesting how investor expectations ebb and they flow and they shift over time.

And I, I do think that where we’re at in the market cycle right now, investors need to readjust their expectations downward and start to get away a little bit from the last five, 10 years of like 20, 25%. IRS is being projected. I think you should be starting to peg expectations somewhere in that 14 to 17%.

That’s still fantastic in the grand scheme of things, but I thought that was interesting is like what he was looking at back in 2018 versus what we’ve been seeing people present over the last couple of years. Vastly, vastly different. Mm-hmm. .

[00:10:52] Dan: Yeah. It might be a product of, of, uh, of size as well. You know, if he’s going after significantly newer.

um, larger [00:11:00] properties. Right. There might not be quite as much of an arbitrage there because he said we’ve got about a

[00:11:03] Anthony: billion now. So Yeah. And he really transitioned to like just 2, 250 unit class A complexes. Yeah. So that would make

[00:11:11] Dan: sense. Yeah, I think that’s a good point. Uh, people do need to realize that the last several years where cost of capital was, or cost of debt was, you know, 3% or even less.

Um, it’s damn near impossible to produce comparable returns when that’s more than. Yep. It’s a huge game changer. So, uh, right my number two is, uh, The, the team you’re gonna need. We’ve talked a lot about the, the team members that are needed in this business. Uh, this is a team sports. Very cliche, but very true.

Um, it is really important, especially if you’re newer, for you to understand how much, uh, how big of a deal this is early on and how much it should be a priority. People are always so excited to get in there, get the first deal under contract and just start running really fast. But if you don’t have the key players in place, [00:12:00] um, You’re setting yourself up for, for, for.

And he called out the usual, you know, the broker, the insurance agent, the lawyer, the cpa, accountants, all those guys are, are, are important. But the, the one big one that I think needs a ton of attention, especially if you’re a newest indicator and you’re looking at outsourcing the management. Is the property management side of the equation.

Cause I’ve seen so many deals go poorly because that piece was not executed effectively. It’s really hard to do when you’re smaller and you’re looking at smaller deals until you get up to a pretty decent size. If you’re doing value add, like he’s talking about in this book and like we do, um, this is gonna be really, really, really tough and you need to probably spend pretty much all your time.

That element, making sure that is in place. And then, uh, another thing you mentioned was, uh, the mentor component. Um, I think that’s a great place to start, uh, for newest indicators as well, because they’ll help keep you focused on the right stuff. Um, I didn’t really do that necessarily. Kind of, [00:13:00] sort of did it, um, a couple years into the journey, but, uh, I think I everybody could lean into that a lot harder.

Um, for me it was a little bit more of an ego thing. Wanting to be able to say, I didn’t have a mentor. Um, but at the end of the day, you get a good one. It can’t possibly hurt the story.

[00:13:16] Anthony: Yeah. On that, I would say go get a coach. Go get a go. Find somebody who can coach you. If you’re gonna do your first indication, go find somebody who’s done it before.

Hopefully they have like as much of a in-house as possible so that you can learn like the operations, the acquisitions, the capitalizing. But, um, depending on what you want to do, go find that person who’s doing it and then get them to coach you on it. And I, I would like to be coached on a specific result.

So if you want go raise capital, go find somebody to help you, like coach you on raising capital. If you want to do asset management or be a property management, like go find somebody to coach you on it, which is a, a different relationship than a mentor. Just you’re gonna go pay that person and they’re gonna teach you a very specific thing.

Mm-hmm. , I think it’ll accelerate your learning. Reduce the likelihood that you’re gonna mess [00:14:00] up. And, and which gets into my next one, which is, I’m getting outta order here, but the, that this is not a side hustle. That what you’re doing when you’re syndicating is you’re building an investment company. So you gotta treat it like that.

And I think this is really important. A lot of people I know who are still working at W two, they’re like, They’re trying to syndicate on the side or they’re just gonna be a capital raise on the side and like doing certain things. I, I don’t like that personally. If you’re going to get to the point where you’re gonna raise capital from people and they’re gonna trust you with it, and you’re gonna go out there and try to generate returns, I think this should be your, your game.

It should be the thing that you do. It should be the primary focus in your life. And, and the reason I I say that is because one, we’re dealing with large sums of money and these are very big properties, but number two is that it all things get. If I have the choice between investing with you or who is part-time and doing this at nighttime, after you work at W two or with this person over here who’s full-time, why would I ever invest with you?

This person over here is like giving it their full attention. And so I see a lot of [00:15:00] people get into syndication, think it’s gonna be the route to getting out of their W two in a couple of years. Get that passive income, get that freedom. And I think that’s wrong. I think you kind of have to have established that before you get into syndication.

Personally, that’s my take on it. Um, do joint ventures, do deals with your own money first, if you’re doing it as a side hustle, what, The way I talk about this is pay your tuition at the school of hard knocks with your own money first. And then when you’re ready to go, take other people’s money. Make it your full-time.

Yeah, we just

[00:15:29] Dan: did an episode. Um, it’s probably the one that came out right before this I to guess read on our transition from Yep. What we were doing to, So take a listen to that because we did it absolutely perfectly. Nothing wrong. We’re spitting examples of, of everything you should be aspiring to be.

I’m joking. But we, I think we both kind of did it the way that, that Anthony just kind of described, We eased into it, albeit part-time at first, uh, with our own money. Then small partnerships, just joint ventures [00:16:00] before we ever went out and started raising capital for passive investors. By that point, it was a fulltime gig.

And that’s also a really interesting point about the part-time syndicator versus the full-time. Um, because as much as you wanna say that, you know, everyone’s gonna have the best intentions, uh, if you just look at the. The risk profile is completely different, right? This part-time syndicator, if they’ve got a full-time job, um, they don’t have as much to lose.

If the deal falls apart, then the guy who’s like, this needs to work or, you know, I’m out of business. That, that’s a much different risk profile for the, um, the full-time guy than it is for the part-time guy. And that’s, it matters a hundred percent. It matters. Definitely matters. Yeah. Alrighty, by number three.

Um, finding and analyzing deals. So this one is, uh, Really simple point. But you know, after being in the business for years now, something I’ve seen, uh, especially on the newer side, and some people who’ve been in the business for a long time are still like this. Um, but they’re scattered, right? You’ve gotta have a framework for what you’re looking for.

You don’t wanna be looking at multiple different [00:17:00] markets and multiple different asset classes and just jumping all over the place. New development, deep value add, uh, mobile homes, apartments, like a lot of people. Are you gonna try to be jumping around to find the best deal in kind of any market or any asset class just to like get a deal done as opposed to really dialing in the parameters of what they’re looking for and going after that thing?

It means that you’re probably gonna take more time to find the right opportunity if you get really specific. Um, but it’s gonna keep you from wasting time and you’re gonna be much better if you lean into a specific strategy. So you wanna set parameters for what you’re looking for. Asset class size, location.

Business model. Um, you know, what, what’s, what kind of, what kind of variables are you looking to be able to pull, right? Is it a value add deal? Do you wanna see a hundred dollars, uh, potential upside of the rents? Um, you’ve gotta nail all that stuff down and just be really specific. But a lot of newer people are just so scattered looking at all these different things and it’s, um, [00:18:00] we’ve, you know, interacted with those types of people.

And it could be a bit, uh, frustrating for us cuz we’re very focus. And if we try to potentially partner on a deal with somebody who’s not, it’s like, it’s annoying.

[00:18:12] Anthony: Yeah. One of the things Joe talks about, I find it interesting, is that you set your parameters first and then you underwrite to hit that number, and then you determine, okay, what can we offer based off of that?

Whereas if you don’t have that parameter, then you can’t back into what number on the acquisition side would make sense. And a lot of times people, like somebody will, I work with students who will bring a deal and they’re like, Is this a good deal? And I’m like, I don’t. A define good deal. And unless you can define what good deal means to you, how do I know if it’s a good deal or not?

And you define it based off of like, Oh, I’m looking for a five to 70 year hold this much irr, this much cash on cash, like this much rent. Like all those, those things are what tell you if it’s a good deal. And you get to determine that. So first you have to determine what’s a good deal and then see if you can make that deal fit into that mold.

And that’s how you know if it’s a good deal or not. But [00:19:00] until you have that, you have no, you have no context. You just have a. Yeah.

[00:19:03] Dan: For some people a good deal is a deal that needs absolutely no capital in very little work, right? Brand new, build turnkey, um, might only yield 5%, but for some people that’s the perfect deal.

It’s not gonna require any capital. No work should be pretty easy. It’s just a place to put capital. I like easy, not for us,

[00:19:22] Anthony: but I like easy. Okay, so my number three is, let’s see, which one do I want to use here, because I got out of order. Um, this one was interesting. I, and again, I, I wanna bring this one up because I wanna get your opinion on it, Is that he talks about how to find off market deals, and he talks about a couple different ways of doing that.

One of them in particular, he talked about was title companies, like getting a good relationship with the title companies because they’re, they’re, they’re doing so many deals. They’re talking to so many people. They, they have the fingers on the pulse of all this stuff, and he’s like, Title companies are a great place to go and source off market deals.

And I was like, Even now I’m like, Is it, is that true? [00:20:00] I don’t know if that’s true, like thinking about our relationship with our title company and like how much information they have, how much insight, how much like interaction we even have with them on a deal. I’m like, I don’t know if that’s actually very good advice.

[00:20:11] Dan: Yeah, I mean, I’d, I’d have to say that, you know, at best we might be able to get an idea of somebody who is in the midst of offloading a lot of things, But I wanna say there might even be some constraints on what a title company could disclose to somebody. Right. I, I wouldn’t expect them to. Be like the connectors.

I, I don’t know, just seems off.

[00:20:32] Anthony: I have a really hard time imagining our, our title company, and we use like, pretty much the same title company every time. I, I can’t imagine a scenario where they just give us a call and they’re like, Hey, you might wanna look into this. Like, yeah, we could ask and see, We could ask for some reason that one, like, there’s a lot of good advice in this book, but sometimes you see something or like, Mm.

Is that just a thing? Somebody’s saying that sounds good in theory, or did you, did they ever actually get a deal through a title?

[00:20:54] Dan: You know, it might also be one of those things where it, it’s, it’s an exception. There might have been one time, [00:21:00] One, yeah, one guy at one title company that Joe had a relationship with that, you know, yielded some deals for him now

[00:21:07] Anthony: if he had the title company.

Oh, there you go. Now, if you own the title company you had, then you’re gonna say some deals. Well, other can of worms. Um, I, I, I’ve also heard, you know, relationships with the property management company can leads off market deals. I think that’s far more likely. Yeah. But, Title company. I don’t know. Anyways, I just wanted to put that one out there cuz I didn’t want to gush.

Uh, Irreverently towards this book. I wanted to be, I wanted to point out some, some issues as well. Oh, I got issues too. Oh, you got some issues?

[00:21:32] Dan: Okay. Let’s see your issues. Uh, my issues are on the last one. I’ll get to that last, but, uh, my next one is,

[00:21:37] Anthony: uh, you wanna end us on a sour note? Okay. I get Yes.

[00:21:40] Dan: I’m gonna, I got my soapbox back here.

I’m gonna pull it out and we’re gonna end on it. And I’m 20

[00:21:45] Anthony: minutes. I just looked the big, so that’s a big soap box.

[00:21:47] Dan: It’s gets used a lot. All right, my number four. This, I should have made this. Number three, um, is Joe’s three immutable laws of real estate investing. I just pulled these out because I think, Oh, I got one of those.

[00:21:58] Anthony: I got all three. I [00:22:00] got one of those. Okay, you go ahead. Okay. Just know that this is one of my two people.

[00:22:04] Dan: Well, you just piggyback off of it, but I think this is important because I, I like number one, buy for cashflow, not for appreciation. It’s basically just saying like, um, you know, don’t go. Uh, with a business plan that, that, that relies on the market improving or, or the economy to improve.

You wanna get into something where you’re gonna get, you know, good, solid cash flow. And if the market improves, and if the economy does well, great, but if it doesn’t, uh, you’ve still got that cash flow. So you can just sit there and sit there and wait, which we’ve always taken heart, uh, secure, long term. Uh, there’s a lot of people, probably not so much these days, but for a long time people were, were pretty loose with debt terms on deals.

Um, they’d get in with, you know, short term variable, uh, rates, which are fine for, you know, the last decade. But, uh, anyone that was in that type of product over the last year, um, they might be having some issues right now. And number three, have adequate cash reserves. [00:23:00] Um, we’ve always done this, you know, raised the capital for improvements, um, coming very well capitalized.

Yes, it brings down the returns in your proforma a bit because your denominator’s bigger, more cash needed, but it allows you to, to, you know, see through pretty much any storm. So all, all very good, uh, pieces of advice in my opinion.

[00:23:20] Anthony: Yeah, I had the, the last one in particular as one of my takeaways, which is the cash reserves.

And I think that’s super important because if you have ample cash reserves, you can, you can. Rocky times. The other one that I found interesting was long term debt. He, he mentioned something about, um, having long term debt longer than your whole period. And he’s like, If your hold period is, you know, X number of years and you want debt that’s longer than that, And I was like, Mm.

That this is, again, like one of those things that’s like, it’s good in theory, but actually very hard in practice and maybe a little bit unrealistic in practice. Especially if you’re looking at like, Oh, we’re gonna hold this thing for 10 years. If you’re new, like get, you can get 10 year terms [00:24:00] can be very hard though.

Not in

[00:24:02] Dan: a value add though. So I think that’s kind of a discrepancy where I feel like maybe his business model has changed, like maybe in the earlier days he was doing heavier lift value ads. Um, but you know, the 14% IRR reference this long term debt longer than the whole period starts to kind of imply these going after some pretty well stabilized stuff.

But typically that that really great long term debt that’s gonna be agency. You’re not gonna get like a really good value add deal with agency debt. Usually you’re gonna go in the way we do it with the regional bank where we still, you know, get five years or so, uh, of a term there. We’re not doing short term bridge with variable rates or anything like that.

Um, but then, you know, once we get to that point of, of fully stabilized and fully maximized operations, then we throw on the long term agency stuff. So we kind of end with that, but,

[00:24:47] Anthony: This is interesting cause um, so that was one of my takeaways, but I’m just gonna jump to my last takeaway, which now has like, offset us and now you’re, you gave us the first one and the last one, so, but he said that forced appreciation is the, the main wealth producer, [00:25:00] which is a hundred percent true.

Mm-hmm. , I do think that you, you, you buy for cash flow, not appreciation, but you also understand that appreciation is what’s going to ultimately drive wealth generation. And so, I think he’s getting more into that class A space. But even in that space, like it’s the appreciation if you can force it. I don’t think there’s much to do in terms of force appreciation on the class A asset.

I think that’s kind of oxymoronic. But um, in that class C, class B space, it is that forced appreciation where there’s the real value. So there’s a couple things, like concepts that are a little bit at odds, I think, in this book in terms of like by debt that’s longer than your whole period. And then also talking about forced appreciation and recognizing like that’s where the real value is.

So, mm-hmm. , I don’t know, like you have to take some things when you’re new. You might not yet have the filter to be able to say like, which parts. Super relevant and which parts can you put aside? Um, but now having read back on it, I can, I can look at it through with a more nuanced eye and say like, uh, [00:26:00] some of this doesn.

Fit together like a puzzle? Yeah.

[00:26:02] Dan: I think, uh, at least my interpretation of this was like, I think he was using the word appreciation differently than forced appreciation. So I went, I think when he is saying in his, his rule, uh, that you buy for cashflow, not appreciation, I think he’s more so talking about like, Um, organic market appreciation.

Mm-hmm. . And then on the force appreciation side, that’s where he’s talking about actually going in there, improving the property to create, create the appreciation. Those are two very different animals. So I’ll, I’ll give him the benefit of the doubt and assume that was a little nuanced thing that obviously a newbie probably wouldn’t be able to, to pick that out.

Um, so either he needs to clarify it a little bit better or there’s just a little bit of a contradictory piece there. My last one, um, Just the concept of asset management to property management. Um, there’s a, there’s a decent amount of, uh, content in the book on how to effectively be an asset manager, which, you know, I thought was a, a pretty decent overview of, of, you know, what investors’ [00:27:00] expectations are gonna be from you.

But I did feel like it was a bit light on talking about how to effectively execute the business plan. The book talks about your job as an asset manager to execute the business plan, and it gives you a bunch of KPIs to work with your property management team on. But to be honest, this, this piece felt really light and I think it really undersold how much actually goes into this, because there’s a lot more to executing the business by than just saying, I’m gonna execute the business plan.

Uh, it’s, it’s very, and this is in particular, I think the part that should be its own book. because it’s not as simple as saying, Hey, property management team go do this. And then they go and do it and it’s done. Um, it’s, this is a big piece and I think you definitely need to go and dive deeper on this part if you’re actually gonna be a syndicator, because this is where I wanna say like 80% of the work is in actually getting the assets to perform is mainly this piece.

And [00:28:00] he gives you, I think, a good overview of a lot of the elements, but not really how to execute on

[00:28:04] Anthony: that. Yeah. Full transparency though. There’s not really, I can’t think of a single book that really does a great job on asset management specifically, because it’s not sexy and there’s not

[00:28:15] Dan: a, Yeah, I think this is probably where the coach, mentor thing really comes into play.

Yeah. Um, because it’s, it’s huge. You wanna nail it. Um, he kind of told you like what directions you should be looking, but not necessarily like, I think you’re right. I think there might just not be a really

[00:28:32] Anthony: good book on. I wonder if it’s a book that could be written to your point of like every building, everything is a little bit different and so I wonder if it’s just kind of like a coach would be much better served to help you through the nuances of each building.

Cuz like you can teach the general principles of like here the KPIs, here’s how to, what to look for. But then in terms of like actually implementing it in your business, it’s probably pretty specific. Yeah. I mean everything’s different.

[00:28:57] Dan: It’s real estate, I feel like. [00:29:00] Um, no matter how long you’ve been doing the thing, 20, 30, 40 years, you’re always gonna be encountering new problems.

There’s always gonna be some sort of new fire that needs to be put out. So it’s . You know, I guess maybe a good place to start would be, um, I don’t, you know, uh, crushing, uh, commercial real estate by Brian Murray. That’d be a good place to start. Yeah. Like the more horror stories you’re aware of, I feel like could be pretty beneficial and that’s got a lot.

[00:29:24] Anthony: Yeah, I don’t remember that book really going too much into like the week by week, day by day of asset management and

[00:29:31] Dan: No, but I think it sheds the light on the potential, how bad things could

[00:29:34] Anthony: go. Sure. Definitely. Yeah. I don’t think this book does that. No, there’s, there’s no horror stories that I remember in, in this book for, Nope.

I, I don’t really think of any. It was all pretty positive. Yeah. , It was all rainbows and sunshine when it comes to syndication, so. All right, so that’s uh, the best ever apartment syndication book by Joe Far. We have just saved you actually, if you’re interested in being an operator, you should read it. You should read it [00:30:00] like our takeaways.

Our review is not going to do it justice, but hopefully, honestly, in the grand scheme of like books on the topic, there’s just not very many. Not very many out there, very few good ones. And this one I do think stands. A, a top the rest, it’s gonna give you the 50,000 foot view of what you need to know, not necessarily how to do it or how to do it well, but I don’t think any book can do that.

I, I think that’s a very big ask of a book. Yeah. So if you got some value out of this, you know, do that thing that you do where you go and drop a review. If you didn’t get any value out of this. Well, let me try and turn it. You can download a free resource called Sophisticated Investor Notes. You just go to invictus multifamily.com/notes, and you’re gonna have a folder with like 20, 25 investor notes of all the books that we’ve reviewed, and you can just download ’em for free, absolutely free.

Doesn’t cost anything. Just a little bit of your soul. Um, I’m just kidding. It doesn’t even cost that. And now, if you [00:31:00] didn’t get any value out of this podcast, well. I don’t know what to do. What do you want from us? I don’t know. Do you want Dan to dance? Tell you what? You go leave a review? We will do a 15 minute dance party with Dan.

Just me. Just Dan by myself. Just Dan? Yep. So leave a review and say, I want that Dan dance party and well, what’s the music gonna be if we get five of those reviews? Just five. All we gotta get is five reviews of people asking for Dan Dance party. We will do, We will put. , Uh, we’ll, we’ll, we’ll put on some Beyonce.

I was gonna say Nick Minaj, we’ll put on Nicki Minaj. We got, we got like, what five songs we can get through. Probably, we can probably make him dance to five songs. So five reviews gets five songs worth of dancing. We’ll let you guys choose the songs too. So you’ll let us know, uh, I want that Dan Dance Party and let us know the songs that you wanted to dance to, and then we’ll, we’ll, we’ll think about it.

[00:31:51] Dan: I’m an excellent dancer, so he’s not,

[00:31:55] Anthony: Have you been to a wedding with, He’s got moves like Mc Jagger on his death. [00:32:00] Those are probably still pretty good moves. Mick has hips that won’t, won’t stop swiveling. All right, that’s gonna do it for us. Let’s get outta here. Let’s go home, let’s get back to work. Or, you know, go back to sleep.

Whatever you were doing.

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