Due Diligence Essentials with Chris Salerno and Justin Moy

Episode 159 of the Diary of an Apartment Investor with Chris Salerno and Justin Moy. Transcript by Otter.ai – please forgive any errors.

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Brian Briscoe 0:00

This is Brian Briscoe, hosts the diary of an apartment investor podcast and partner at four oaks capital. So we have something that we've been working on for a really long time we are building and we'll continue to build an educational community that we're calling the tribe of Titans. And it's going to be a community of multifamily investors based around education and his house on the mighty networks. What you're gonna find in there is a lot of events that are exclusive to the tribe of Titans members a tonne of educational content, and you're gonna find great people. So if you're listening to this podcast, because you're looking for community or you're looking for education, go no further the tribe of Titans is something you need to look into for the price of about $1 a day, you're going to be able to have access to everything that we have an elder content that we continue to produce for years to come. And just so there's no pressure and there's no obligation, the first month is free. So sign up first month free, and give it a test drive if you'd like to keep hanging out and you'll continue to have access to Well, me and my partners are four oaks capital in a lot of other experience and aspiring investors. And where can you find it? The tribe of Titans dot info. There's a link to that at the bottom of the show notes of every single episode right now. So if you're interested, type in www dot the tribe of Titans dot info or go down to this bottom in the show notes and just tap the link.

Justin, we got Chris on the line. What do you want to ask him?

Justin Moy 1:22

So what is the biggest mistake or something that you wish you could do over in the multifamily business here that you could help me or other people listening? Avoid?

Chris Salerno 1:33

When you go into your due diligence, get it done as soon as possible? Don't wait. When we go under contract. Within a week we have our due diligence team out there walking all the units and we're getting all that information. We're getting all the lease audits and we're analyzing that deeply. There's been some times that we may overlook a little bit but I would say really go deep with the due diligence, the lease audits, because I think that's extremely important when you're in that due diligence phase.

Brian Briscoe 2:08

Welcome to the Diary of an Apartment Investor Podcast with your host Brian Briscoe. In this podcast we bring some of the top professionals in the apartment investment field to discuss various aspects of the apartment investing journey, with the sole purpose of educating listeners to make wise investment decisions. The Diary of an Apartment Investor podcast is sponsored by Four Oaks Capital, bringing you high yield returns through apartment complex investing. Welcome to the diary of an apartment investor podcast. I'm your host Brian Briscoe with four oaks capital. Super excited for today's show today we have two great people on the line with us and one of our Ask the Expert series episodes, we got Chris Salerno, and Justin Moy. So first of all, Chris is basically transacted more than $40 million in real estate, and helped lead the number one real estate team in the Carolinas produced more than 140 million in annual sales. He was named to Charlotte's 30 under 30, elite 50, elite 50 entrepreneurs 30 under 30 entrepreneurs and nominated for Forbes 30. Under 30. He's quickly gained recognition and notoriety for his hard work and dedication in the real estate industry. So Chris, welcome to the show today.

Chris Salerno 3:14

Thanks so much for having me. Very excited to be here and add value to everybody.

Brian Briscoe 3:18

Awesome. Now, before we get into your bio, I know you have a podcast as well. Do us a favour and tell us a little about your podcast.

Chris Salerno 3:26

Yeah, so the podcast called the mindful multifamily show. It's on Spotify, iTunes, and we interview people from really all different types of industries, but mainly focusing on multifamily real estate and the mindset behind it going from zero units all the way up to 10,000 units and what was that mindset, the challenges the obstacles? And how were they able to accomplish that? And that's the gist of it.

Brian Briscoe 3:53

All right. So I have noticed that reflecting on on my past I've had several mindset shifts myself. Why did you pick that mindset to be the the anchor of your podcast,

Chris Salerno 4:06

but mindsets everything in my opinion, you right now our mind controls our body, it controls, you know what we're saying. And it's, I mean, it's the computer to our body, I does everything and in during this entrepreneur journey during you know us as operators with growing the business and in the deals that we come across and deals we operate. We have a lot of obstacles that we have to jump over. And in some of those obstacles May, you know may be too big to jump over. So we need to figure out ways to get get around them. And your mindset plays a huge factor into that. During situations when you know that when you're at your low, you need to have a strong mindset to pick yourself back up to keep going. And that's not only in business, it's in the personal life too. You know, we all have personal struggles, the struggles in life, and if you don't have a strong positive mindset to to get through those struggles. You're going to be at your low and you Going to be down all the time. So it's really key to build that mindset up. Very similar to David Goggins. If you know, David Goggins, he's a workhorse big mindset guy. And you just you got to power through it. It's all about the mind.

Brian Briscoe 5:13

Yeah, a lot, a lot, a lot of mindset things that I picked up along the way, you know, I'm, I'm still active duty in the Marine Corps. And in basic training, they they put a lot of mindset. Hey, yeah, thanks for your thanks for saying so.

Chris Salerno 5:25

But they always say that, like, when you first went into training, to get into, you know, the service, they built your mind up into being a soldier down mentally and then they built it up to being a soldier. Yeah. You guys go through is unbelievable, the first couple months, but they want to see how mentally strong you are to go out into the field when you get deployed. Absolutely.

Brian Briscoe 5:50

Yeah. And they they played they played, we call them mind games. I mean, that's what that's what most of boot camp is. Boot Camp, you know, was was not physically demanding. I expected it to be physically demanding. And when I showed up to boot camp, I think the, the most we ever did, we did one four mile run, you know, which, I mean, for some, for some people, that might be a lot, but I mean, we started out, it would be extremely fit. You know, and we started out with, like, a mile and a half, you know, and in my training and getting ready for boot camp, I was doing a lot more than that, you know, and so when I when I got there, and we were only doing a mile and a half I was like scratching my head thinking but it was full of mind games it was and that's exactly what it was it was building up the the warrior mindset but you know, the the never the Never Say Die, they never quit the, you know, you got to accomplish the mission at all cost type mindset. And that's something that I that's helped me a lot to in a lot of areas of my life is okay, we're going through something hard. But, you know, let's, let's just keep on pushing, you know? Yeah, I saw I saw a quote once. I don't know who it's attributed to, but it says, if you're stuck in hell don't stop, you know, and it's just one of those where you start thinking, I'm like, Okay, that makes sense. You know, you're stuck there and in your bad spot. Keep moving, you'll get out. But that is right. So you know, great, great, you know, mindsets huge, and I've recognised like I said, a lot of mind shifts that I've had. So anybody listening, check out his podcast to mindful mode multifamily. You see, he mentioned Spotify and Apple is that on all the major podcast,

Chris Salerno 7:29

we also have YouTube as well, the mindful multifamily show, a closed Facebook group, which is the mindful multifamily network.

Brian Briscoe 7:37

All right, so check it out. And we're gonna drop links to all that in the in the show notes too. So if you're interested, you know, head to the show notes and click through but right, that's it. Chris, tell us a little bit about yourself, your background history and kind of lead us up from wherever you want to start on your journey to what got you into multifamily?

Chris Salerno 7:54

Yeah, so, so I live here in Charlotte, North Carolina. I've been here for a little over 14 years, originally from Florida. I started out in the single family space. as Brian touched on a little bit about the single family history that I have. I was a single family broker broker here in Charlotte, North Carolina, very quickly became the top agent for Keller Williams here in Charlotte. From there, I created a small team. I then merge that with the number one team in the Carolinas. We are also number fours in the world by unit count with Keller Williams at the time. That's why when I did the merger, I fell into their operational role. And I was able to make them 46% profit on about a year and a half compared to the three years of being stagnant no growth. After doing so I just felt like I hit a ceiling. I felt like I wasn't able to build wealth. I felt like I was running that day to day basically nine to five type of job even though it's 100% commission based, and I made my own hours I just felt like it was that corporate hustle. So I started educating myself by listening to podcasts like yours podcasts like mine YouTube videos, reading books on multifamily investing, believe or not, you know, we all know Grant Cardone in the space. When I first got in or when I first started educating myself, I went to the SEC website, and I pulled up his ppm docs. Now I would be lying if I told you I did not fall asleep, but I did. But I read through his ppm docs. Yeah. Because I want to know how they're structured. I was so intrigued with it. And I read through it and it was like 353 pages. There are a lot of doctors. They're really long. You know, if you've got an ambitious lawyer, they're super long, you know? Yeah, and but I wanted to read through it because I wanted to gain the knowledge and you need to gain the knowledge especially on the legal side because it's extremely important in our business. And after doing so gaining the knowledge getting out there. I then cut off brokerage in real estate cold turkey. I left that and I jumped straight into multifamily to create QC capital. And early on I hired a coach and a mentor Joe fairless. And he's a great friend of mine in a great mentor of mine, and scaled the company very quickly from when we created it. And that's how I got into multifamily real estate. Nice, nice.

Brian Briscoe 10:11

That's a common trend from people who come on the show is mentorship, you know, and it's something that almost everybody talks about when they're sitting in your seat is I had a mentor now, you chose to pay to play which, you know, I did, too, you know, not knocking it at all. But can you tell me why you chose mentorship route and why you chose to drop, you know, a lot of money on mentorship?

Chris Salerno 10:37

Yeah, so, when I was a broker in real estate, I, I mentor at around 13, different 12 to 13 different agents on a monthly basis across the whole United States. eight of those were right here in the united are right here in Charlotte, North Carolina. And I realised early on in life is that to get to where you need to be, it's great to limit your mistakes. And how do you limit your mistakes, you find a good mentor and a good coach that is already where you want to be in life, to help you limit those mistakes. So, so I went out, and I was actually listening to his podcast, I went to a networking Meetup group. And I always recommend if you go to a conference, if you go to a meetup group, go by yourself, because you're going to be willing to meet people, if you went with a friend 90% of the time, you're going to sit there and chat with your friends. Go by yourself, because that's going to force you to meet people network. And so I met a couple people, a gentleman stood up, he gave his success story. And I went up, thank them for coming. And I said, you have to have a coach, who is it? This is Joe fairless. I said, Why never I listened to his podcast now. Never knew he coach or mentor, how can I get a hold of them? He said, I can do an email introduction. But there's a series of steps. I said, I don't care. I, I want them. And I was able to get them, we clicked very well. And now we're not only you know, he's not only my mentor, he's a personal friend of mine. But it I did it because it helps limit your mistakes. So if anything comes up, I can give him a call and say, Hey, I'm going through this. Have you been through this? What's your opinion about it? So I don't make those mistakes. So the success of the company can grow a lot, a lot faster, in a shorter amount of time, than if I had no guidance at all.

Brian Briscoe 12:20

Yeah, I think that's huge. I mean, limiting your mistakes, everybody's going to make mistakes, okay. And that's something that's just gonna happen, especially on your first deal. You know, I wish I wish we were mistake free, but out of the five guy five partners in four oaks capital, I mean, we've been through several programmes, you know, we all had different mentors been in for pay to play mentorship programmes, and you know, the two guys that have not done mentorship programmes still have mentors, you know, people who can pick up the phone and call so it's something that's been very instrumental in my success. And, you know, the only thing that I'll add to what you said is, it's like an accelerant to I mean, it prevents helps you prevent mistakes. And, you know, it's like lighting a fire with gasoline, you know, it's just like, it's gonna like and it's gonna burn,

Chris Salerno 13:07

it'll fast your business is taking steroids, that's what it is, you know, your business is taking a shot of steroids to grow substantially and limit your mistakes, which is, which is key in this business, because you're gonna you're going to make mistakes. And, and the best thing to do is eliminate those mistakes.

Brian Briscoe 13:23

Yeah. All right. Cool. Let's let's talk about, you know, one of the deals you guys have been in your multifamily deals, you know, pick pick one, or kind of talk us through your overall investment philosophy, whichever direction you want to go.

Chris Salerno 13:37

Yeah, I would say let's talk about the most recent deal. We just, we closed about six months ago, it was a 506. c as in Charlie, and it was in Greenville, South Carolina 144 units. Very exciting times, because we raised roughly 7 million during the holidays, COVID and a historical presidential election. So it was Well, I'll tell you, but But yeah, it was a great deal. It was presented to us semi off market from a broker that we have great relationships with, and and it was a C plus b minus type of asset built in 1986. We no longer focus in the 80s or the 90s. We will look at the 90s. But our main focus right now is 2000 to 2021. That's our main strategy right now. But it was a great deal. rents were substantially below market right now. We're running around 125 above our performer with zero renovations on the interiors. So we're extremely pleased on how the property's performing. And we're very excited about

Brian Briscoe 14:40

Nice, nice. Yeah, we're in the Greenville market as well. Usually I'll have a virtual background behind me that's the river. Yep, downtown. But the downtown Greenville area but working on a new laptop and I didn't get that set up. But anyway, love Greenville. There's a lot of good dynamics there. You know, it's just a growing fast, you know, and it's there's a lot of nice things. The city is putting a lot of money into to redeveloping the downtown. And it's just kind of spilling over on the rest of the city. You know, they went from, you know, not a very attractive downtown 1520 years ago to a beautiful, you know, walkable restaurants, you know, shopping everything down there. So

Chris Salerno 15:22

it's nice. And you know, I visited earlier this year, and they had live bands playing, I mean, just the whole vibe that they have going on and, and that they're growing and downtown is wonderful. And I think that's why one reason a lot of people are flocking, there's because the lifestyle.

Brian Briscoe 15:39

Yeah, absolutely. So it's a great place. And, you know, hope that hope that goes, that investment opportunity goes extremely well. Sounds like it's done. Well, so far. Very pleased. Yeah. And, you know, incidentally, that that's one that we did look at, we did not put an offer in on that one, because we had two properties under contract at the same time and doing three through the Christmas holidays, you know, oh, yeah. Wow. Two was enough. Yeah, so anyway, I understand what you're saying. I mean, when, when you're trying to raise money, and this is kind of a lesson learned for people, but if you're trying to raise money, you know, things that distract people, you're things that pull people's attention aside, are going to make it difficult for you to raise money trying to raise money through the holidays, you know, presidential election where everybody's, you know, hyper focused. Yeah, it's just, you know, people are like, Oh, yeah, you know, I II, but, you know, you send them the investment opportunity, maybe they get on the webinar, but they're, they're just their focus is elsewhere. So, you know, one of the lessons I learned is if you can avoid raising money over Christmas, you know, avoid it, but very much. So cool. All right. So one thing I'd like to ask everybody, and I think this is crucial, you know, you talk about mindset, I think this is actually part of the mindset, but what is your big burning? Why, what, what drives you?

Chris Salerno 17:03

Well, what drives me now is my little man, his name is Cruz Salerno, he's 18 months, and that's what drives me to work harder. That's what drives me to push the company harder, and to grow the company is him right there. And the love and passion I have for him, I you know, unless you have kids, I can't tell you. Because it's just it's unbelievable. So once he came into this world, that just, that was my huge why, and it pushed everything.

Brian Briscoe 17:32

Yep, kids, kids are a game changer. We have five kids. And incidentally, my oldest daughter is the podcast editor. So you know, she'll, she'll hear this discussion. It's, you know, I gotta be careful what I say, you know, I can't say man, kids are terrible. I hate though edit. So edit your version out. Yeah. And she'll, she'll, she'll, she'll let me know, you know. Now, but yeah, kids are a game changer. And, you know, having having that first kid was just one of the most life altering things that have happened, you know, I would say, you know, getting married is is is a big life changing thing. But having a kid is more life changing and getting married. Because, you know, two adults living together is one thing, you know, but you know, when you bring a child into the world, you know, you're 100% responsible for what they what they do, you know, so yeah,

Chris Salerno 18:20

and it's so hard to explain until you have one. I mean, just so hard to explain. I just that's what I tell everyone until you have one come talk. But other than that, I find the love the passion, the drive the motivation that I have. That it he you old, I mean, he just dumped there was a wildfire. He just dumped gasoline all over it. But once he came into the world, so

Brian Briscoe 18:44

all right, well, hey, can correct congratulate, I know 18 months old, but you know, congratulations on that. That's That's awesome. But Alright, so So last question for you before we bring Justin on what's next?

Chris Salerno 18:56

What's next is growing the company. We have a handful of deals right now that we are investing final for our our partners, which are our invest with that partner alongside of us. They are just they're hungry right now. It should have us present them the next deal. So we have a couple right now that are looking extremely promising and that are meeting our criteria. So hopefully those pencils in here the next couple of weeks, and we can get awarded them and then we'll move forward and blast it out to our partners. So that's what's next with the company.

Brian Briscoe 19:27

All right, awesome. All right. Now let's introduce our next guest. We got that Justin Moy on the line here. You know, Justin, you know started out in real estate sales with single family homes in the San Francisco Bay Area. So something that Justin you and Chris have in common there. And then he learned that the real estate wealth was in owning real estate so much more than then selling the real estate and after graduating from college at the University of Arizona, moved to Scottsdale and is now pursuing a career in apartment syndication. Justin, welcome.

Justin Moy 19:56

Thanks so much for having me. I'm super super excited. And yeah This has been an amazing journey so far. And it's only looking up and I'm super, super optimistic. But I'm having a really great time I'm learning a tonne, which is exactly what I want. And you always want to kind of push yourself in what you're pursuing. And, and this is really definitely done that.

Brian Briscoe 20:16

Yeah, absolutely. It's a great, it's a fascinating field. I mean, it's one where you've got to be on your toes at all times, and you keep your finger on the pulse of a lot of trends, you know, but you know, what, once you learn which trends are the most important to you, you can kind of focus but that said, Give us give us a little bit more of your background in history, you know, the stuff that we don't find in the bio, tell it tell us about yourself?

Justin Moy 20:37

Yeah, yeah, absolutely. So, um, you know, grew up, like you said, in the Bay Area across the bridge place called the East Bay. And so there I, you know, just like most kids probably graduating high school struggling to see where I wanted to go, what I wanted to do, I saw my parents did, and I knew I didn't want that, you know, I didn't want that. Like they made great livings. But they worked like dogs, 3040 years, and my father is just now starting to retire. But he's still working 10 to 15 hour days at a restaurant that makes a lot of money, very successful, but just not the life that I wanted. And so after high school, I looked for ways to avoid college so that I could avoid that sort of nine to five, and a route. So I got a job working for the government for a few years. So took me down to Southern California, went out to Virginia for a couple years. And then when I came back, that's when I started pursuing real estate sales. Again, pretty, pretty similar to Chris I was very, very good at it. From a young age, I was super hard worker, I was hammering the phones, you know, five to eight hours a day, if I didn't have listings, I would just go and go and go and going, made great money, but had a it's now or never moment to go to college, you know, I was getting cut up there, I was about 23 to four or five at the time, as I was not going to go now. I'll never go. So went out there and also wanted to move around a little bit want to have a little more freedom, because I'm sure as Chris knows, once you build that business and single family, you don't want to exactly move and have to start all over. You want to keep that reputation, keep your brand. And I didn't want to be trapped. And so that's prompted me to get out and move and see a little bit more of the country and see a little more of the world. And you know, for me to continue that lifestyle. I needed something else that wouldn't be so direct sales, restarting every day at zero, you know, really having to get after every single day. And so that's why I went down the rich dad rabbit hole. And you know, like, like most people's stories found myself here in the multifamily world. Yeah,

Brian Briscoe 22:33

yeah. I mean, the rich dad, that's Yeah, I see this very frequently. That's the most often book brought up on this on this podcast, and probably most most multifamily podcast, but to your Scottsdale right now. And speaking of the real estate thing, I had a real estate agent Come on this show and said something that just just made me laugh and see if it if you guys think it's true, he said that he would get a listing, go through all the work, get it sold, and then wake up the next morning and feel like he was unemployed again, you know, because you know, now now we've got to go find the next one that

Chris Salerno 23:07

that hustle. You have to keep going, going going. And eventually it's just like, you know, you're done. You're done hustling?

Unknown Speaker 23:14

Yeah. Like, yeah,

Justin Moy 23:17

yeah. And it was a little sketchy because I thought I couldn't leave my phone no matter what. Because I was talking with that's the listing. What if that's the client? What if somebody's going to call me right now? And then if I pick up they'll call somebody else? And so it's a rat race. Exactly. Yeah,

Brian Briscoe 23:31

yeah. And we're selling the house. Right now in DC. We should actually close today. But you know, man, I mean, I've texted my my realtor, she probably hates me. We were friends prior to be she probably hates me now. But sometimes I'll text her at like, eight, nine o'clock at night. Because that's when I'm thinking of stuff. And she answers you know, so it's just if she if she stopped answering at eight o'clock, I stopped texting rate o'clock. But But, you know, that said, you know, now we're working with a buyer's agent here in a different city. And, you know, it's, you know, we're go, we went and looked at some houses at five, six o'clock yesterday, because, you know, that's when, when things are available. So, yeah, I get it. I've seen it from from my end, I don't think I'd ever want to be a real estate agent, because of exactly what you said. But it can be lucrative, you know, especially in a hot market, like today. I mean, I think in some areas, you know, is getting off the subject but you know, close but some areas right now the real estate markets so hot that as a as an agent, all you got to do is hit the list button, and wait for offers to come in. But Alright, so, Justin, I mean, you talked a little bit about, you know, why you took this route, but if you could boil things down to you know, one or two sentences, what's your big burning? Why?

Justin Moy 24:45

Yes, I would say it's, it's really, really strong and it's really, really simple. You know, I don't have kids. So the next, you know, great loves in my life or my parents. You know, I'm fortunate enough to have them both still still living and I actually, you know, they've said Braden and I have step parents that also love me unconditionally, and I love them. And so again, seeing what they do and what they've done and how they've lived their life, as they get closer to retirement, you know, I don't want them to ever have to worry about anything. I want them to be able to retire actually a little bit early. And my father is probably already at that age, but my mom still has maybe five years, I don't want that I want her to be done in one or two. And so you know, I have plenty of energy and time to work and hustle and do whatever I need. But, you know, it's time for for them to enjoy their lives. And I really want to see that for them. And then of course, it allows me to live the life that I like, as well. And I'm super passionate about causes specifically in hunger and homelessness. So this is also allow me to pursue some patches there as well. But you know, my parents always, always come first with me.

Brian Briscoe 25:44

Yeah, retire your parents, you know, and, yeah, this is the flip side of what Chris and I were talking about earlier, you know, that the relationship between parents and kids, but, you know, it took me, it took me to actually have a kid to realise how much time and effort my parents put into raising me, you know, and it was one of those things that after my first kid was born, you know, you know, two months into it, I pick up the phone, I'm calling my parents. I'm like, thanks. You know, I mean, first time ever realised. It's like, Thanks, Mom. Thanks, Dad. But well, cool. Well, here's, here's my favourite part of the show here. Justin, we got Chris on the line. What do you want to ask him?

Justin Moy 26:21

Yeah, absolutely. So Chris, I mean, thank you so much. I know your time is super valuable. So anytime somebody smarter than me, and more experienced than me has time for me, I'm gonna take full advantage of it. So I appreciate you. Yeah. Awesome. So you know, I don't know if this was exactly you when you started out in multifamily. But, you know, most people that start out here, start out part time, right, they usually still keep their full time jobs. And I'm in that boat, too, you know, I still have my regular quote, unquote, day job. So if you were going to kind of go back in time and start your business from Day Zero. But let's say you only had maybe 20 hours a week to work on it, and to get done what you want it to get done. How would you delegate that time? You know, what, what would you looking back? You know, what do you think are the most important thing is if you have really limited time throughout the week, what would you do? Okay, a couple questions. You said you didn't have kids, correct? I do not know, you married? I'm not. Okay. Well, that's perfect.

Chris Salerno 27:18

And I don't mean, like, Eric is great. But, but so that's great. If I was going back in time, I would have a say a savings account with a certain amount of money in it. And hopefully you do as well. And what I have done, even prior to getting into brokerage in real estate, and then I brokered real estate for about three and a half years, and then I got into multifamily real estate is I had a certain amount in my bank account, and I quit what I was doing at a certain amount in my bank account, and I said, I am going to make this work. And that's what projected and pushed me because I put my back against the wall. Humans are wired very differently, but we're wired to survive. And when we're all put on, when we all have our back against the wall, we tend to do things and we tend to call people we tend to network, we tend to get out there to survive. We were all in a village, and we had to go get food to bring back to the village, I promised you we would probably come back with food, the wives would not be happy if we came back empty handed. So I that's why if you have the ability and you have a certain amount saved up, if you have that ability to quit to jump straight in full time, I would highly recommend it. In my opinion, that's what I did. But if you don't have the ability and you want to delegate those 20 hours, I would really sit down with yourself to see what are your goals are your goals to acquire properties between 20 units and 100 units? If so, then we need you need to contact with brokers, build relationships with brokers, and start building that report. So you can start getting those type of deals, or your goals to partner with other co sponsors or with other GP operators. As a co sponsor, if that's the case, build relationships with those those those sponsors and those GP, the GP teams, so you can then grow your business. So there's multiple avenues that you can go down. It really comes down to what does it look like for you what you want? That makes really cool. Yeah,

Brian Briscoe 29:21

I'll say well, I'll add to that. One is something that helped me and this is this is part of the mindset conversation, is I reminded myself every day while I was doing things, okay, so it was about three years ago that I decided to do this. It was all for family. It was for, you know, my oldest daughter who we've talked about already. She turns 22 in about a week, two weeks, and I have missed I think 18 of her 22 birthdays because of my career because of my job, you know, and it was it was missing another one of our birthdays that made me realise I can't keep doing what I'm doing. You know, I can't I can't keep missing these events. And I put on The date on the calendar tober 31st 2021. That's that's when the Marine Corps would let me retire. That was the first time. You know, so I put that date on the calendar and I burned the ships. Okay, I basically told myself, you know, similar to what Chris is saying, I told myself, there is no other option, I am not getting a job. Okay, I'm going to make this multifamily thing work. You know, so I essentially did what Chris said in a slightly different way, I put my back up against the wall and said, Alright, you know, I'm going, and I put in about 20 hours a week, quite, quite frankly, you know, for the first year or so it was 20 hours a week on nights weekends. But I agree what wholeheartedly is what he said, you know, figure out what you need, and and what you want and focus on exactly that.

Justin Moy 30:45

Awesome. So yeah, I mean, so seeing how you want to building relationships was kind of the cornerstone of that, right? whether it's with brokers and whether it's with your your investors or other sponsors, GPS, stuff like that relief for everything. Yeah. Absolutely. So that I mean, kind of goes perfectly into my next question, which was, you know, when you're either starting out completely fresh, or maybe you're in a different market, where you don't really know any the brokers, you've never done deals, there were never done deals at all. You know, what do you do? Or how do you stay top of mind with those brokers? You know, what's your excuse for following up and being top of my I keep hitting them? And do you have a system like, do you, hey, every month I have in my CRM, I call every broker I know, or, or, you know, what's the system for doing that. And, you know, what's your excuse for reaching out when you do reach out and just to continue to build that relationship.

Chris Salerno 31:34

So what I do with the brokers here, the great thing is, is living in Charlotte, in the middle of the Carolinas in the Middle East Coast. But anything you're looking at in the Carolinas, mainly all the brokers live in Charlotte, because they can commute everywhere to Charleston, Greenville, Raleigh, Wilmington, Myrtle Beach, it's in the middle. So what I've learned is, is because I used to be a broker, most brokers want to leave the brokerage industry at one point to be an operator. So we already have that bond. But what would I just treat them like a regular person talked to him. I mean, I asked them, hey, you want to go grab drinks, you want to go hang out, you Hey, there's something going on, you want to go grab lunch, and I build that personal report with them. And I and I know I'm like, I know, their daughters I I know, their family, their wives how's your wife doing? So I build that personal report with them. So I stay top of mind. And then when the deal that they the deal that they're pursuing comes, you know, they sign a listing agreement, and it meets our criteria, they reach out to us, we just we got a deal from a broker in in Greenville off market two days ago. And they sent it to us because we we was talking to just a normal conversation, not even talking real estate sometimes. And so I would say build that deep relationship with them get to know him personally, just like you would do to your investors, or your partners. I like to get to know him personally, how they're doing. The one calling me out of nowhere, and I knew he had knee surgery, I said, how's your knees doing? Are you are you running your marathon yet? So it's building that personal report with him. So you stay top of mind. And that's how they're gonna keep feeding you deals. This market right now is so hot, though. Sellers don't want to sell off market. We're even doing pre emptive offering and they're like, no, we're gonna wait to you know, the call for offers, because it's so hot. So. So building that relationship helps tremendously with the broker. So even when you're in the call for offers and your investment final, you can have a leg up. Yeah, yeah,

Brian Briscoe 33:32

I'll add one thing to that, you know, and very dangerous, saying that I'm talking to former real estate agents. But I like to look at the single family example. You know, if you're a real estate agent, and somebody calls you and says, I want to buy that house, you're going to vet them, you're going to ask them for a pre qualification letter every single time. Because you want to make sure that they're going to be able to purchase a house, right? I mean, I'm assuming that's correct. That's what the every agent I've ever purchased a house through is first asked for it. But in the brokerage world, it's no different. All right, they're gonna want to make sure that you're qualified to purchase a property before they're gonna let you start fostering that relationship. So I think first, first and foremost, you've got to be a viable buyer, before they'll they'll actually let you start building that relationship in a lot of cases. So if that means partnering, you know, partner, if that means you're learning more, you know, learn, learn what you need to do, but definitely learn what it needs. definitely learn what it's going to take to close on a multifamily property, and then get yourself there. And then when you make that call with the broker, it's going to be a much different conversation.

Justin Moy 34:41

100% Yeah, I really like that. That's that's a great point. Great. So yeah, I have so just for my third question, sometimes like I'm always a big workhorse, right. And so when I was a single family, when I didn't have a deal, or I didn't have things in the pipeline, I wasn't, you know, at listings or listing appointments. I only knew what I to do with like, I'll just cold call. I'll just pick up a camera and I'll get my own and I'll go, yep. And so but in this business, you know, is that still a route to the extent you know, sometimes I feel like I want to work on the business. But I don't really know like what to do. Like, I've looked at all the opportunities already, I'm not getting a tonne of opportunities. So it's not like I can I can analyse deals for hours a day, you know, so what do you do? or What can I do to kind of create more opportunities for myself when I do feel like I don't really have a to do list or the things that are your priorities? I'm kind of out of those opportunities?

Chris Salerno 35:35

Yeah, no, that's a great question. I think it comes back to my first, my first answer is, is that you got to know what you want. Do you want to focus on 20 to 100 units, if so you can cold call those owners because you're going to have a higher chance of actually getting direct with the owner, because it's going to be a mom and pop that you can actually get a deal. If it's 100. Plus, from my experience, it's going to be very difficult to talk to an owner, and if so they may have processes steps and things like that. So it comes down to is what are you going to focus on for your for your company, if you're gonna focus on the smaller, you can definitely cold call, I know people that cold call those those, those smaller type of units and they get deals. If it's larger type of properties, it's going back to building relationships, in my opinion, with the brokers from what I've seen all over the Carolinas, and what I've experienced, is that large groups like ours, we're gonna go to a broker to list it. We're rarely going to just sell it off market unless it's a buddy of mine who I know personally like like Brian, and he's like, hey, I want to buy your Greenville do I say, this is what I need. And if it works out, boom. But more than likely, we're just going to take it to market with a broker. And it's just building those relationships deeply with them.

Brian Briscoe 36:49

I will say that I cold called a lot of people getting started, you know, probably more than I needed to but like I said, I wish I would have followed the advice that I gave you is make yourself a viable investor. That's going to save you time but i i was cold calling brokers. I mean, there there was a point in time where I was getting like zero deal flow. And I would be googling you know, multifamily brokers, Charlotte, multifamily brokers, Columbia, multifamily brokers, Raleigh, you know, and try and I would literally, I had a goal, you know, call five new brokers every week. And that was something that I did it was and they were all cold calls, I would have gotten more traction had I worked on myself a little more first and make sure I was a viable buyer, but and then when I needed property managers guess what I did, I googled property managers, or I would go to apartments, calm, you know, pick up the phone, find something in the neighbourhood and say, What property management company do you work for, you know, and stuff like that I was, I was cold calling all over the place. I will say, you know, it's probably one of the least effective ways. If you can get referrals, that is, you know, 1000 times better than cold calls. But if you're starting from scratch, you know, cold calling is something a lot of people do. And we got our first property through cold calling, actually. So kind of a cold call and a referral. Quick, quick story. I cold called a broker. You know, her brokerage did more land and comer and other commercial real estate than multifamily. They sold like one or two multifamily properties per year, everything else was like land and industrial. And it was talking to her building relationship with her. And she finally said, You know what? I can't help you. I'm sorry. But my friend, can she works at this brokerage over here. Can I can I introduce you to her and she set up a call. And that introduction called led to the first property we closed on. But you know, I would say if you can get a referral, go for the referral. Otherwise, cold calling might be if,

Justin Moy 38:56

yeah, me kind of tying back to my question before with like, hey, building that relationship and your excuse to reach out because I pretty much am in that cold state where like, hey, I've called brokers. I'm looking along St. Louis, Kansas City, I'll just say, Hey, you know, my adjust, I go into my little little pitch, do you have anything I can look at? And then, you know, however, that comes to jazz? Oh, not right now. You know, we'll keep you in mind. You know, what is the next call to that meal? Are you saying the same thing? Or are you You know, I've always paid bring value, but it's like, what value can I bring? You know, are you just really calling against? Hey, you know, we spoke with maybe a month ago, you had you mentioned you might have something coming up, you know, wanting to see if you had anything I could look at between this unit and this unit, you know, are you calling to continuously ask, like, hey, do you have anything I could look at right now or are you doing something else?

Chris Salerno 39:43

Yeah, so that's a great question. So as a residential age, and one thing I found when I coached residential agents is that you have to stay consistent and you have to follow up. If you want to buy or if you want to listing you have to stay consistent. You have to follow Whoa. So use that is very similar to following up with these brokers stay consistent. Just like Brian said he would contact for five in certain markets every single You know, every week or every two weeks, you know, and you have to stay consistent with that, what I found is that I build deep relationships with them on the first call. So I let them know a little bit about me and let them know a little bit about the company when I first got started. But I also want to know about them personally, I want to know them what the what their goals are. So it helps on the second call that I can say, Oh, hey, how's your daughter doing? Or how's your family doing? You know, things like that. And I just wanted to follow up to see if you have any deals coming in the pipeline, and he BPO is out there. What are you seeing in the market right now. And it's just a nice casual follow up, but you're also wrapping a little bit about their personal history that they told you into it, which I've learned that makes a call go a lot smoother. And you can you connect a lot deeper when you do that.

Brian Briscoe 40:59

A couple of things that I did starting out, you know, it cost money, but I would send Starbucks gift cards, you know, and it almost always got a response, okay, there was like, you know, out of out of, you know, 50 or 100 or so Starbucks gift cards I've sent, there's probably one person that didn't either text me, call me or email me back to say, Thanks for the Starbucks gift card. You know, that's one thing that I did that to help out. And Chris also said something that's important is you've got to, you've got to get back then you got to be responsive. So every I mean, I would also look at loop net, I mean, let people say loop nets where deals go to die, okay, probably true. But Craxi is also one of those are a lot of brokerage webpages will have their listings on there, a lot of times, it's downloadable, too. So it's like, click here, you know, trying to please sign their nondisclosure agreement or whatever the confidentiality agreement, and you get the documents, you know, if you can get your hands on those number one, it gets you practice underwriting. But then you can go back to the listing broker and just say, Hey, I'm looking at x and y property, tell them what your underwriting comes out to and say, hey, look, I'm thinking that X, Y, and Z, and then maybe ask a couple follow on questions. And most of the time that shows that you're serious, and most the time, that's going to lead to, you know, at least a first call or a follow up call or, you know, start to build that relationship.

Justin Moy 42:25

Awesome. Thanks. That's super, super valuable. And just going into my last question here. So what is, you know, Chris, whether you call it a biggest mistake, or something that you wish you could do over in the multifamily business here that you could help me or other people listening? Avoid?

Chris Salerno 42:45

Yeah, so biggest mistake that to help avoid in the multifamily, he's

Brian Briscoe 42:50

asking you, not me. I know.

Chris Salerno 42:54

So I say it may not be a mistake, but it's lessons learned is that during when you when you first get into a deal, you definitely want a great legal team, when it comes to negotiating your PSA to make sure you have everything in there with with the opposite party. And then when you go into your due diligence, get it done as soon as possible. Don't wait. When we go under contract. Within a week, we have our due diligence team out there walking all the units. And we're getting all that information. We're getting all the lease audits, and we're analysing that deeply. There's been some times that we've may overlook a little bit, which, early on, which, thankfully, the product of those those assets are doing phenomenal, and we're happy. But I would say really go deep with the due diligence, the lease audits, because I think that's extremely important when you're in that due diligence phase, and it's very difficult now, because you're placing a lot of money hard. I mean, for example, anything above 100 units here in the Carolinas, we're putting anywhere from three to a million dollars hard day one. So you have to make sure you do those due diligence prior. But when you're in that due diligence, you really got to go extremely deep, in my opinion, and all the financials, the lease audits, when you're on site to make sure you're making a very sound decision. And you don't you don't make a mistake, you know, during that due diligence, and it bites you on the back end.

Brian Briscoe 44:20

Yeah. I will say you know what, one of the biggest mistakes I made and this is on our first acquisition, be in a hurry to close, okay, we, the seller on our first acquisition made the mistake, you know, he started the PSA. And he measured the due diligence period, he measured everything in business days and not calendar days. And so we walked away with an obscenely long time to close and every time we had a decision to make, we said, we got time, let's take our time. And really, you know, I think you just need to have the, the the mindset that you need to be in a hurry to close Okay, you need to You know, not i'm not saying rushed through things, you know, I'm not saying, you know, you do things, you know, in a shoddy manner to hurry up, but you know, get the ball moving, okay, keep the ball moving and always be moving that ball forward and be in a hurry to close because things are going to come up, they're going to take time. And if you're wasting time you're wasting a week making a decision on something trivial. You know, that's where your mentors come in. That's where you pick up the phone, you call a mentor and say, hey, I've got x, what should I do? and rely on those mentors. But anyway, that's, that's my two cents on that one. So

Justin Moy 45:36

well, so awesome. For you, ppreciate. Thanks so much, guys. I mean, they get super super Bible, I really appreciate both your time and both your input. You know, I said, mentorship comes in a lot of forms. And so for a lot of people, I know it's podcasts like these, maybe they can't afford it, they don't really have somebody they want to pay, like you said pay to do. So really, thank you so much. For both of you. This has been super, super valuable for me. And I know for a lot of listeners as well. Awesome.

Brian Briscoe 46:01

Well, that said, we're about out of time. So we're going to be closing up shop here. One question to end for each of you, Chris, you go first, how can listeners learn more about you?

Chris Salerno 46:12

If you go directly to our website, QC, Capital Group comm and click on the invest tab, you'll be able to fill out your information that will go to the team and then we'll set up a 15 minute call to see if we're a good fit for a partnership on our next acquisition. So that's how you can get a hold of us and get a hold of me personally.

Brian Briscoe 46:29

All right, Justin.

Justin Moy 46:31

Awesome. Yeah. For me, you know, I'm because of my broken background, getting some pretty good opportunities, have some off market things we're looking at now. And of course, looking and looking for capital. Of course, like always, if if you are looking to have strong capital connections, looking for some partners there so you can always reach me by email Justin at perpetual wealth, capital calm, you could go to the website to fill out the form, but you know, it's probably going to be best. So we'd love to talk to you if you have any capital connections want to GP on some deals.

Brian Briscoe 46:57

All right. Awesome. Hey, thanks so much, guys. Appreciate your time on the show today and thanks.

Thanks. Thank you for listening to the dialogue and apartment investor podcast today brought to you by four oaks capital. If you'd like to know more about how to invest in apartment buildings or want to be a guest on our show, visit our website at four oaks capital comm slash podcasts or email us directly. If you're still listening, you obviously like the show. So pull out your phone, app, subscribe, and leave us a five star rating on your favourite podcast app. And we'll see you again next week.

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