Mindset for Success with Mandy McAllister and Morgan Fielder
Episode 75 of the Diary of an Apartment Investor Podcast with Mandy McAllister and Morgan Fielder, hosted by Brian Briscoe. Transcript by Otter.ai – please forgive any errors.
Brian Briscoe 0:00
Morgan, we have Mandy on the line here. What do you want to ask her?
Morgan Fielder 0:02
This is awesome. So what do you notice the underlying mindset problems that sort of block women from success in this multifamily space?
Mandy McAllister 0:12
Did you plant this one Brian for women, especially the fear of any woman who's drawn to something that's this high performance stuff, you know, we were perfect little girls probably like I spent the better part of my first 35 years being perfect and realising that in order to grow in any entrepreneurial venture or you know, anything like this real estate stuff, you're gonna screw up and you're gonna make some mistakes right? So for me the mindset of get over the fear by getting comfortable with the downside, have some accountability, and then just figure out that next right step.
Brian Briscoe 0:53
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. This is journal entry number 75. And part of our Ask the Expert series today's episode we bring on experienced investor Mandy McAllister and aspiring investor Morgan Fielder. Stay tuned for strategies to talk to potential passive investors how to access the capital of people have on the sidelines in the mindset that can help women be successful in multifamily investing. And now the show Welcome to the Durban apartment investor podcast. I'm your host Brian Briscoe. And I'm very excited for today's show. This is one of our Ask the Expert episodes we have two amazing women on the line with us right now. One with a tonne of experience in this and other businesses, Mandy McAllister and a motivated energetic aspiring investor who's a Navy veteran and physical therapist Morgan Fielder. So first I want to induce Mandy she's a multifamily real estate investor, mindset Ninja, eternal learner coach and dock connector. Her real estate expertise includes a portfolio of 205 doors primary B class workforce housing, Mandy's found success in college towns and student housing as well as urban centres. Her passion is to help others define their path to financial freedom, especially women through her platform, aspiring women to achieve more. Wow, that's impressive, Mandy, welcome to the show.
Mandy McAllister 2:21
Oh, hi. Thanks for having me, Brian.
Brian Briscoe 2:24
Yeah, this is awesome. Super excited to talk with you today. You came highly recommended, just just so the listeners know, I asked a bunch of people, you know, who can I bring on the show? And I had like 20 people say, Hey, bring Mandy McAllister on. So I've been excited for this ever since we first talked and decided to schedule. So that said, Mandy Will you tell us a little bit about your background and history? And what got you into the kind of the apartment investing field?
Mandy McAllister 2:49
Yeah, so I'm the daughter of two entrepreneurs. My dad's a farmer, my mom owned a gift manufacturing store thing growing up. So it's kind of the self employment stuff is always entrepreneurial spirits always been in my blood, so much so that when I was 12, I started Hocking scrunchie, is to all the local volleyball teams and cheerleading squads it's anyway. But then in college, I remember being at a party and a friend was talking about her dad bought the house that we were having this party in, and she was renting the rooms to our fellow sorority sisters. And I thought and you get to keep that money. Why this is the best idea ever. Right? So then after I finished my master's, I worked on the floor of the Board of Trade and really saw these paper assets. In some cases, you know, guys would lose millions in seconds. And the idea of my dad's farm ground became immensely more interesting, these hard assets really kind of informed the way I wanted to invest. And then you know, reading learning, Rich Dad, Poor Dad, whatever, all of that stuff, you know, ended up following all the rules that are he says, You're supposed to own your own home before you invest all of those things. So long story short, didn't really dive into buying assets for express purpose of investment until about 2016. A few short years, and we ramped up in a pretty cool way.
Brian Briscoe 4:07
Yeah, yeah. So Rich Dad, Poor Dad, I think was was a catalyst for a lot of people. I mean, it's something that kind of sparked something in my mind. It took me several years to actually implement, you know, the things I wish I would have implemented it all immediately. So prior to real estate investment, you were you were working kind of corporate job type stuff, stock trader, what kind of led you to that transition? I mean, was it was there a particular moment where you said, I need to move more than than something else?
Mandy McAllister 4:35
So when I was a, when I was on the floor of the Board of Trade, it was it was obvious to me at that point in time that, you know, my role as a broker's assistant was to add things and I'm very I'm okay at math, but like a computer is way better. So it was obvious that that was going away. So I made a transition into medical sales because I started undergrad in chemistry finished in business and you know, had a pretty successful time doing that and you This type of impact I got to have you know, I've hugged probably 15 people who were alive because of these devices that I touched specifically because of that device so that that impact in my life was super It was great, but it you know, you kind of end up chasing your tail and with the comp plans and you never really reached financial freedom you end up with these golden handcuffs that you have to keep showing up and you start fresh every single year. And the idea of what have you done for me lately? It's hard that'll wear you down so the building assets that had this residual income you know, if I built one then the next one would build on top of that and oh my goodness, at some point you you know are making more with the real estate cash flow than you do with your paychecks coming in from this medical sales job so it's that's been powerful
Brian Briscoe 5:48
Yeah, I think that's huge. I saw quote probably on LinkedIn yesterday where the person who has a $25,000 passive income stream is a lot more rich than the person has a $200,000 annual income from from a W two from their labours you know so it's it's a it's a concept that I think a lot of people that get into apartment investing really latch on to where it's get out of the rat race mentality where I've got to keep on returning to my job every single day to keep that income stream coming in. But if we invest in assets you know, which is kind of the rich dad model if we invest in assets that pay us eventually we'll be able to disconnect ourselves from that sounds like you You caught on to that one started buying assets and good
Mandy McAllister 6:29
Yeah, well one more kind of note on that is you know, I when I'm you know, coaching some friends we're getting into this, this idea of one time money versus forever money you know, the the you get you get paid one time for exchanging your hours for dollars or if you flip a house, you get paid one time or Gosh, even I'd argue with syndication is in many cases, one time money because your, you know, business plan is three to seven years. But if you can set up these, you know, annuities that pay you for forever, then you you know, you're that's how you build legacy wealth.
Brian Briscoe 7:00
You know, and you're right flipping and syndications are just larger flips to that. And some people don't really realise that if you're investing passively in it, you know, you're you're starting your passive income stream, you know, but if you're actively pursuing the syndications, it is a larger flip, you're taking an apartment building, instead of a single house unit or single family home, you're taking a building with 3060 or maybe 200 units. And you're essentially flipping that, you know, so that's typically what syndication is. And as a syndicator, myself, it's not the syndications to build my passive income. It's what I do with the income from the syndications that creates the passive income.
Mandy McAllister 7:41
Thank you for voicing that I that that doesn't normally come out in these apartment type conversations. So I mean, it's exactly what I think, too.
Brian Briscoe 7:49
Yeah, you know, and our strategy, and I don't know how other people feel, but our strategy is, you know, we're basically syndicating to be able to invest more and more into cash flowing assets. So a little different than a lot of people. It's working for us. Let's put it that way. I totally agree. Yeah. So what, when you got into real estate investing specifically apartments, you know, what was your your first couple experiences, like?
Mandy McAllister 8:14
So I am a real advocate of walking before you run, that this is what worked for me. And I, I mean, I think, especially for, you know, women, you know, anybody can suffer from this idea of imposter syndrome stuff, but I think women really do tend to, you know, wear that in a bigger way. And, you know, when I proved it to myself that I can make a four Plex work in a big way, and then a six Plex work in a big way. You know, it just it made way more sense that I could go into the bigger stuff and be a really good steward of somebody else's money, because I, you know, while I'm careful with my money, I'm way more careful with somebody else's, you know, so, you know, getting started for me was a four Plex, and then a six Plex, you know, in pretty short order.
Brian Briscoe 9:02
Okay. And from that six Plex, how did you scale up from there? Did you start to start syndicating after that? or What does that progression look like?
Mandy McAllister 9:09
So roughly at the same time, I did the six Plex, I also passively invested into 130 unit to kind of get a sense of what I liked in terms of the communication, what I didn't like, all of those things. And, you know, did a lot of learning there and actually, it was a home run of a deal. So it was it was great to see that what I like to see and om and offering memorandum is what will end up potentially making sense in terms of a business plan. Um, then after that, you know, joined a partnership, a joint venture with two other gentlemen and we recently took down a 53 unit in Indianapolis, just three of us.
Brian Briscoe 9:46
Nice, nice. And something else that doesn't come out very much is his JV versus syndication. I mean, there's some people that'll stand on that soapbox and preach, but if you can get into a JV as your first deal for a while People that's actually better the returns are better than than syndications. And sometimes the experience is better than syndication. So, obviously, to be able to get into jayvees you have to bring a little bit more to the table than maybe indications, but we're good. So 50 how many years 35353 in Indianapolis, I've heard a lot of good things about the Indianapolis market, what attracted you to Indianapolis?
Mandy McAllister 10:25
You know, when I first kind of started this, let's go, let's add a zero, you know, type thinking, um, you know, I don't trust Illinois, you know, what's hilarious is like, right before we were on this call, I spent a whole hour trying to send back $1,000 of unemployment benefit, you guys have a job, Illinois is sending me money for unemployment, like we are so poorly governed in the state of Illinois, it's stinking bananas. So I knew I wanted to be in an area with larger GDP growth, larger population growth that I felt is better run in a better run state, but it's close enough that I can do you know, a quick flight or a quick drive and, and be back in the same day if I'm going to have a growing footprint so that that meant Kansas City or Indianapolis, and my younger brother and his family live in Indianapolis and a college teammate as well. So Indy made a tonne of sense. And that's, you know, where we're looking to expand our footprint.
Brian Briscoe 11:16
No, I think you made made three really big important points. And maybe I can count maybe I can I'm, I think of a number four before we get there, but your number one, you pick the state that had more friendly laws, you know, towards towards landlords or towards towards investing in general, maybe not towards landlords. Sometimes investing in your backyard does not make sense. And in your case, you're like, hey, my backyard doesn't make sense. Okay, the next thing is you pick something that's fairly close, which, if you can't invest in your backyard, you know, your your within a couple hour drives, you can get to the properties. And the third thing that I think is a very key point is you have good reasons to go to Indianapolis anyway. Alright, so, you know, and that's, that's something that, you know, I went through the exact same process. And maybe I like what you said so much, because that's exactly what I did, I went through the exact same process, like, it makes no sense to invest in DC. That's where I live right now. No sense for me to invest in DC. So I started looking around your east coast. And then finally, I said, Hey, Carolinas, are doing great. And my wife's from Columbia, boom. So great minds think alike, is all I got to say on that one. So a lot of good points on that one, and very much appreciate it, when you tell us a little bit more about this 53 unit?
Mandy McAllister 12:40
Yeah, absolutely. So you know, in kind of thinking through what's going to make the most sense to, you know, for using my economics part of my brain, you know, where we're at has so much uncertainty in, you know, just the fiscal environment, and everything is just so uncertain, from soup to nuts, right. So what I really want to see in any type of acquisition right now is a business plan. With a heck of a lot of outs, you know, I don't want just one exit plan, I want a tonne of exit plans, potentially. Right. And I want a tonne of, you know, room for our breakeven analysis. So the reason you know, the way I underwrite anything, it's like I call it Goldilocks method, right? So you do the best case scenario, which is what you're going to manage towards, you do the worst case scenario, which is what I work to get really comfortable with in order to move forward that that really kind of squashes the fear monster, because if I'm really comfortable with the worst thing that could happen, then why not do it, you know, and then there's that Goldilocks, right in the middle with some really conservative assumptions that if I'm going to be talking to investors, that's what we talk about. So this asset in particular, was outside of about, well, just you know, outside of city centre in Indianapolis, so kind of a b type asset. We acquired it in September, so collections around COVID were real tricky. And, you know, through conversations with my business partners, this idea that the jobs were in jeopardy are the ones that you know, don't have a college education required, right? So your Barton manicurist, the ones that stayed employed at Tennessee State employed are like your computer programmers, your sales reps, your nurses, people like that. So, you know, we had this really kind of clever idea to you know, we knew our breakeven economically was 42%. We ended up going through the applications for rent to see you know, is this a concerning job or not, we had about 20% concerning jobs, and it gave us the comfort to move forward. So it's a B class asset. It was stabilised, rather than value add, which is really what a lot of people are looking for. So how can we kind of construct the safety nets and look at stuff that not only Everybody's looking at so that we can have a better crack at it.
Brian Briscoe 15:03
Yeah. And you know, stabilise versus value add, you know, it's just, it's an investment philosophy. And it's, it has a different return profile, but it also has a different risk profile. And I think between the two, you know, value add brings a little higher risk, but has, you know, higher returns associated with it. So, you know, I don't think there's a right or wrong answer, I think, you know, when you look at stabilised versus value, add, stabilised, tend to generate a little more cash flow value and have a little higher upside, and it's more of a, what are you looking to get out of an investment than it is a right or wrong, good or bad? But now, did you say a 4140, something 42% breakeven, was that a vacancy or occupancy? economic vacancy, economic vacancy? Okay, that's still, you know, a really good number. I mean, typically, we're seeing a lot of things that are in you know, mid 60s, as far as breakeven, aka occupancy, not not vacancy, but, I mean, that's a 50% 58% break even occupancy, which is still incredible. I love it. And I also love the the attention to detail that you talked about right there where you went through the leases, and, you know, the property managers should have, you know, information about employers on file when they do the job application, you know, so you went through and you looked at the, their employment, to see, is this a high risk, you know, high risk employment and COVID? Or is this a is this somebody who's going to keep their job? You know, I think every nurse in the world right now is, you know, probably in very high demand, gonna keep their job. And like you said, bartenders, every bartender in the world right now is probably thinking, Oh, my gosh, what am I going to do in the next couple that have gone to nursing school? So let's talk about your big burning, why right now? What's your what's your big motivation? Oh,
Mandy McAllister 16:48
I am so big on personal development. One of our friends who introduced us Barry Griffis, and I do a mindset series on his podcast. So I, you know, I am so big into this. And, you know, I did a seminar called date with destiny with Tony Robbins, roughly a year ago, and you define what the purpose of your life is, and it's the thing I have is a background of my phone. So the perfect purpose of my life is to spread impact and joy with every life that I touch. So that is my big burning Why?
Brian Briscoe 17:20
Okay, that's, that's nice, every every life that you touch, you know, that's, that's something that it's absolutely achievable to you know, I love it. I absolutely love that, you know, spreading spreading joy to everybody, but how does that that big burning? Why help you to do apartments?
Mandy McAllister 17:33
You know, this idea of impact? It's, I mean, where else can you put your money that is more impactful to another human's life than where they let you know. And if we are, you know, our team that's out of Indy, we're very clear on we are only picking places that we, you know, maybe not right now in our life, but at some point in our life, we would have absolutely lived here, and we doing right, by people will always yield the best possible result.
Brian Briscoe 18:02
Yeah. When you when you're providing housing, you know, being able to provide a safe, clean home for people to live in, you're helping people out, you know, so that that's something that's big, you know, make making sure you have safe communities making sure you're, you're giving back to people. So that's, that's, that's amazing. Um, so next question for you. What's next for Mandy McAllister?
Mandy McAllister 18:24
What is next? So, you know, we are that that team I spoke about, we are running our footprint in the Indianapolis market. And we you know, we really like the Midwest. And we really like this heavy cash flow, stabilised asset that, you know, if we can replicate what we just did, we want to do it, that and, you know, I'm really enjoying helping out the folks I get to help out through a plat form we created roughly a year ago that now has 1800 members that's blows my mind called aspiring women achieving more the kind of accountability and inspiration that we provide they're
Brian Briscoe 19:01
now the spring women achieving more is that real estate investment related? Or is that just any woman can can join?
Mandy McAllister 19:09
Well, anyone can join. It just so happens that you know, the group of buds who started it with me, we're all you know, commercial real estate investors and that's it's rare to find women in commercial real estate, thus the reason for your posts and we kind of banded arms and focused on the whole life experience because, you know, I am a real estate investor to figure out the money part of life so that I can go live my life you know, I'm not I love it. Don't get me wrong, but I love it for the you know what it brings my life you know?
Brian Briscoe 19:42
Good, good. Well, we'll make sure we have links to that in the show notes so anybody can can find you and find your your network. I think that's awesome. And I, anybody who pays attention to anything in commercial real estate, can't help but realise it's a very male dominated industry you know, there's every every conference that I've gone to you look around the room and it's you know, 80% male and 20% female. It's almost as I'm active duty military. I know Morgan, you spent time with military it's, it's it's very military ish, you know, when you walk into a room look around, and you know, very male dominated industries. So anything you can do to promote females and women to be able to do better in this industry, I think is is a homerun. So good on you for that. So, let's now switch gears a little bit more. And let's bring your Morgan on to the podcast. Morgan is the mother of two gorgeous girls and has been practising physical therapy and investing in real estate for 15 plus years in East Asia, Europe and the east and west coast of the United States. She has a degree in economics from United States Naval Academy and a clinical doctorate in physical therapy from the University of Rhode Island, her professional journey has taken her from leading multilateral NATO operations, business to business ready to residential mortgage lending and real estate investing and Clinical Health Care. That said, Morgan, welcome to the show. Hey, Brian, thank you so much for having me. Yeah. So tell us a little bit about yourself.
Morgan Fielder 21:09
Well, I have to make a confession. Okay. ever read Rich Dad, Poor Dad. Oh, man.I know. I know. It's it's sacrilege in this space. But I did, I did notice growing up that our family had made some real estate investments. And I was able to express myself through sports and running, because my family had the resources to send me all over the country. And it was something that really changed me because I was kind of shy, little introverted kid and that, you know, sports and girls like it just gives us a power that, you know, set me on a trajectory for the rest of my life.
Brian Briscoe 21:49
See, you grew up sounds like you grew up with parents who understood the rich dad mentality. All right, so you probably didn't need the Rich Dad Poor Dad book as much as I did. You know, my dad's a blue collar worker living on a pension. You know, great man. Absolutely love him with all my heart. But, you know, if you look at the Rich Dad, Poor Dad story, you know, I look at him as more the poor dad, but sounds like sounds like you probably didn't need that book as much as a lot of other people did.
Morgan Fielder 22:17
Yeah, definitely. And then my second confession to make I, after I went to school at the Naval Academy, and after my service time was up, I, you know, kind of jumped into my first career without really knowing what it was just kind of, I was pregnant, and I was scared. And we needed the house. And I became a subprime mortgage lender.
Brian Briscoe 22:41
What, what year, like 2005 timeframe? Yes. Okay.
Morgan Fielder 22:46
2005. So I had this really horrible about real estate at that time, I thought that, if this is what the business is, like, I don't want any part of it. And I actually, I think it was the Cinnabon deal that, like, made me quit, because, you know, my boss would sort of coerce me and push me into doing deals with, you know, a guy from Brazil that no income, no credit score, 100% down, you know, 100% financing. Like, you have to do that deal. Absolutely. You know, and there's no question about it. So I quit. And I went back to the graduate school for physical therapy, full pivot for my economics degree at the Academy. And since then, I've been practising kind of all over the world and loving it, and you know, doing my own single family investing, that's done pretty well. But I kind of hit a sort of a crossroads. My whole life. I've enjoyed the outdoors, and I'm very passionate about sustainability. And we, my daughter, and I were hiking on the Italian Dolomites. And it's just one of those places that so astonishing that your headspace is is completely wide open. She asked me, Mom, what are you doing for the environment? Yeah, kind of hit me right in the heart. Because, I mean, I grew up in the mountains in Idaho. And, you know, there's just so much benefit for so many people. And I had no answer. So I didn't know what I was gonna do. But I knew that I had to change something. And as fate would have it, on the drive home from, from Italy, a podcast popped up with another Naval Academy grad who I knew and trusted, and he was interviewing another guy that was a real stand up, dude. And they were talking real estate and like, Oh, I think maybe things have changed since 2005. And they're really purpose driven. And, you know, I just thought, hey, there's something to this. So I jumped in, joined a mastermind and within a two month period, I realised that there's a way to make impact with it as a real estate and with investing and that there are people like me, and that you know, want to make money and make a difference and linking these people together, but the institutions and the business is my passion. Moving forward, so I quit my job on December 10. And moving full time into this space.
Brian Briscoe 25:07
Yeah, so quitting jobs. How scary was that? Oh, Brian,
Morgan Fielder 25:13
I've been working. I've been. I was 17 when I went to college. Yeah. It's super scary. But I think that the pain of not doing it is greater than the pain of fear. You know,
Brian Briscoe 25:27
I agree with that statement. I mean, for the longest time, I think fear kept me in the military, you know, the fear of not having that stable paycheck. And, I mean, I had two kids, when I went to Officer Candidate School, actually, I had one child and a pregnant wife when I went to Officer Candidate School. Okay, so just just have to be factually accurate here. But, you know, my second daughter was born shortly after I commissioned. And I think a lot of the decisions every time I had a juncture in my career where I could have gotten out, you know, looking at that steady stream of paycheck, you are not having it was, in my mind, it was like, oh, my goodness, but I think I finally reached that point to where, you know, staying in is going to be more painful than going alone. And when you look at the potential income and impact that I can have getting out right now is totally the right answer. You know, so, so, so hopefully, I mean, I keep a countdown at 233 days right now. Yeah, hopefully, when I get to that moment there, there's not a shred of fear anymore. I agree.
Morgan Fielder 26:37
It's especially hard, I think when you have you know, you have a purpose driven career with the military. So, you know, you have that, that feeling that you are doing something greater. And there are so many scary stories, especially in real estate and my experience of six months working in mortgage lending, I'm like, I you know, it's it's hard, you know, but when you can see the forest through the trees, like, it really makes you change your thought patterns.
Brian Briscoe 27:00
Yeah, and I agree with that. I mean, for for many years, you know, I, I came into the military after September 11. You know, so I was I was one of those September 11. Guys, that was just okay, you know, September 12, you know, I was, I was talking to the recruiters, you know, type person. So, you know, for me, it was there's very much a purpose to it. That was almost 20 years ago. And I think it's just time I really like what you said, right there. Where, where do you look at? Where are you at right now, where you're where you need to be. And, you know, you can do more and do better if you're, if you move on, and you take that risk. So I think it's a risk, risk versus reward calculation. And awesome, congratulations. So you're, you know, two weeks after quitting your job, and I'm excited for you. Thank you so much. So, alright, so we talked about your big burning y already. So here we come to the My favourite part of the show where I say, Morgan, we've got Mandy on the line here where you want to ask her?
Morgan Fielder 27:56
Yeah, this is awesome. So I'm really grateful that you're putting out content that is coming outside the multifamily space, especially on your YouTube channel, bringing on economists and sort of getting that bigger picture. Sometimes I think we've become a little bit echo chamber in this space, which isn't necessarily the best way to move forward. We see the ramifications of that and social media, of course, based on your abroad experiences, and that and your your thoughts about it, like do you think that right now because of the uncertainty with, you know, various factors that there's a lot of capital sitting on the sidelines, do you think that there's a lot of people that want to invest, but they're just hanging tight, and they're not moving forward right now, because of the environment? You know, I
Mandy McAllister 28:42
think, you know, like, Brian said, fear informs a lot of things. And I think that to not notice that stuff feels shaky right now. I mean, just about, you know, when your taxi driver can tell it's stuff feel shaky, then you understand that things are really shaky. Right? So I'm actually I host a multifamily meetup out of Chicago for the multifamily masters brand and actually we did a nationwide end of year thing that I had the opportunity to be a host of that we had you know, over 1000 registrants for it. And Neil bow if you've ever heard him talk the he calls himself the mad scientist of multifamily. He had one slide that he talked about for his five minute portion that basically looks at the the difference of the spread between you know what you can borrow at and then what a return would be a cap rates on assets and bits the amount the distance that delta between those two lines is really what informs the richest of the rich of Where should I put my money and usually that that change of you know that spread of where action for buying happens or stops happening, that kind of tipping point is that called call it 400 pips I'll find you the video. Cuz I'm butchering them. But right now we're at over 500 pips. So if the spread is larger, which means we are right now at this incredible time to be buying real estate, and it's because the lending is so dang cheap. And if you're taking on a vantage point like I am, and I'm using this to inform what I'm doing with with my investing, I, we have a 15 year term loan on that 54 unit, we want super long term assumable debt, so that we have a bunch of different out potentials. So if you can get really comfortable with, you know, if this can't work, and I can make that work or that work, you know, then that that cures uncertainty for me.
Morgan Fielder 30:44
Yeah, yeah, absolutely. Sometimes, I mean, I think if you really get down to the nuts and bolts of it with this, that that's really great. But there's a lot of people that are maybe don't have enough time to really think about it that in depth, you know, they want to do their job, they want to play with their kids, they maybe don't really want to think about it too much. But the general atmosphere is oh my gosh, COVID the new administration is coming in? Are the tax benefits going to go away with real estates and cetera, et cetera? So just thinking about those kinds of people? What kind of strategies have you been able to use to sort of talk with them and sort of calm down those fears? You know,
Mandy McAllister 31:24
the person you just describes the person that doesn't want to put all the thought into this, that person should be finding someone who's syndicating deals like Brian or me, or you know, soon to be you. Because, you know, to take advantage of that 500 pips spread. I mean, I think it's, it's something that we see in just our overall economic climate, that is a huge opportunity. And it's a real winter really does come if you're a Harry dent believer, and I know you're an econ girl. So we're gonna geek out over that totally. But, you know, if winter is near, then cash in, or cash flow is king. So how can I you know, keep some powder dry? And if I am investing really have the eye towards cash flow? And if I don't get to make the decision, what our leaders in DC or wherever are making I don't get to, I mean, I can I vote right. But beyond that, I don't really get to inform that. So I have to take that as a question mark that I'm comfortable with either way, so if tax benefits go away, so what I'm investing for cash flow, that forever money concept that I talked about. Okay. Yeah. Do you find that the joint venture model works better for that versus syndication? Absolutely. And and here's, here's why. So, you know, in order, if you've underwritten a bunch of deals, like you, you know, you've seen that this internal rate of return changes completely based off of whatever exit cap, whatever, you know, value add, you're able to achieve that huge bolus of cash at the end is really kind of what makes or breaks, a syndication deal business plan of three or five or seven years. So what this 53 minutes is, it's, you know, it's a stabilised asset, that we have an incredible loan on 3.6 something percent in order to get agreement from passive investors to lock up our money for 15 years, and then kind of wait and see, instead of Bibles, buying watch, you know, to watch what's happening, it's that's a harder sell, you know, but we're very lucky that we have very like minded trustworthy partners that want cash flow first. Yeah,
Brian Briscoe 33:30
thank you. I got a couple couple good points in there. I mean, just adding into that syndication thing. Most syndicators will also take a fee or an acquisition fee, when they put a deal together, almost every syndicator in the world will have some sort of either acquisition fee or disposition fee, you're both which actually dilutes the returns for the investors. You know, it's how they get paid. So out of that syndication, so if you're, if your choice is to invest passively, or to do a JV, your returns are going to be higher during the JV. And if your choice is to syndicate or do a JV, you know, you take that syndication fee out, you put it back into the return bucket, your returns are also going to be higher. So you know, it's one of those things on the flip side, if you're a passive investor going into a JV means you actually have to work you know, you can't be a passive investor in a JV. So there's, there's definitely trade offs. And I do think that you know, if you can get into jayvees, you know, if you have the capital and the time to be able to get in jayvees, the returns are going to be better. And, Mandy, I love what you said about the flexibility because, you know, when you tell your investors, you're going to tie their money up for three or five years. That's not a lot of flexibility. Because somewhere between three and five year mark, those investors are going to expect to get their money back. And your hands are somewhat tied as a syndicator based off of what your investors are looking for. So great answers.
Morgan Fielder 34:55
Very cool. One last question for you. So well to last As the first one is, so if you are talking to potential partners, for example, in a JV and you are new, and you don't have that track record of, you know, sort of following it through, of course, it's to provide that sort of, you know, calming effects like how do you talk with partners like, even though you don't have that track record that the financials workout that the cash will be there.
Mandy McAllister 35:24
So, what I'll say for me, in this, having done a six unit, having done a four unit, having done a bunch of single family that I knew what it takes to run a successful rental, right, you know, we're the 22 units that are just mine, you know, I know that I have a formula that I can make work. So for me this idea of walk before I run and be able to call back to Yes, I know, we added the zero, but I know it can work. And here are here are the the Goldilocks underwriting right. Like, here's what we hope happens. Here's worst case scenario. And here's what we really think is going to happen. And our assumptions are, you know, the the exit cap for it. Here's our reasoning behind that all of those things, to help them get really comfortable with why you think what's going to happen is going to happen. And I mean, I can't say enough right now about having more than just one plan to exit. You know, because if you really pigeonhole yourself on this one thing needs to happen. And you can't thread that needle at the exact moment you need to do it. That makes me a little nervous. And I'm sure would make your potential investors nervous as well. Yeah, for sure.
Morgan Fielder 36:43
Was it hard with the commercial financing? You know, going from like four and sixes up to those much bigger?
Mandy McAllister 36:50
Great question. So thing I didn't even realise I was setting myself up for but having in 2018, done a six Plex by myself that started the clock for I am now a multifamily investor. So now I can guarantor deals, having signed on the couple of deals that I have over the course of the last two years. So you know, there are a lot of advantages to the small Maltese. There's stuff to look out for, because my property management is kind of a cluster right now. But it's it's still works really well. And there's still a tonne of upside, you know, um, but walking before you run, in many ways has been my answer.
Morgan Fielder 37:28
That sounds great. What do you notice sort of the underlying mindset problems that sort of block women from success in this multifamily space?
Mandy McAllister 37:39
Oh, you are my listen. Did you plant this one? Ryan? This was you know, this is a really you're the mindset ninja. So
Brian Briscoe 37:47
I think I think that's the the perfect question on this episode. So yeah, karate chop that thing. I love it. And actually, karate chop that away.
Mandy McAllister 37:57
So I think, you know, we already talked about the imposter syndrome. Here's the, the, you know, for women, especially the fear of, you know, any woman who's drawn to something that's this high performance stuff. You know, we were perfect little girls probably, you know, I like I spent the better part of my first 35 years being perfect, you know, and realising that in order to grow in any entrepreneurial venture, or you know, anything like this real estate stuff, you're gonna screw up and you're gonna make some mistakes, right? So for me, the the mindset of getting rid of that fee, year by way of just thinking through the worst case scenario, and this is kind of born of readings, stoic philosophy stuff, this is I mean, this, this is fine. This is okay. I'm not you know, number one, I'm not going to die. Number two, I proved it to myself in a four Plex that was kind of a tiny little layup type of a deal now, in retrospect, but I was scared to death of a four Plex, you know, so the extra it's a muscle right? This this courage, this, you know, dealing with imposter syndrome stuff is it's a muscle that every time you exercise it, it gets a little easier. So you've got to just take whatever, in my accountability group that I would love for you to join sometime it's Fridays, at noon, or at one o'clock central time. You know, we always say we workshop, what is the next right step? All you need to know right now is what is the next right step. And we're gonna help you as a team, figure out what that is. And then we'll talk next week, and make sure you did that stuff. So get over the fear by getting comfortable with the downside, have some accountability, and then just figure out that next right step?
Morgan Fielder 39:38
Yeah, it's really powerful. I think so many people get caught up in all the details and try to do too many things. They wear too many hats bite off way too much they can chew. But if you really identify what that next most important thing is, and then execute like, Oh my gosh,
Mandy McAllister 39:55
do that you can do the next thing. You know, you might not be able to buy the 90 storey high rise, which I wouldn't buy post COVID anyway, but you know, you could figure out the next right step to get there. So I love it.
Brian Briscoe 40:08
You know, a couple years ago, I used to break things down to exactly that. And I mean, that was a absolute key to the success I've had so far, you know, just just looking from beginning to end. And once I started learning what it takes to buy a multifamily property? The answer is it's a lot. You know, there's a lot of stuff involved. And I kept on boiling it down every single time. What are the next two or three things that I can do to move that ball forward? What's the next right step for how to use that exact words? But that's exactly what I did. What's my next right step? I think that's, that's one of the secrets that a lot of successful people do is they look at what's the next right step for me? And then they do it. Amazing. But well, we're about out of time. I love having both you guys on the show. I got one question for both of you, Mandy, you go first Ready? Here it is. How can people find out more about you?
Mandy McAllister 41:05
best place to find me. Kind of a catch all for all of my investing stuff. This aspiring women achieving more stuff is on Mandy McAlister calm,
Brian Briscoe 41:14
okay. And we'll have that in the show notes. So if you want to check it out, just hit the show notes, scroll, tap, and it'll whisk you away to Mandy mcallister.com. Morgan, same question for you. How can the listeners learn more about you?
Morgan Fielder 41:27
Yeah, absolutely. So I think the easiest way is to go to our website, which is sustainable investors dot x, sorry, sustainable investors group.com. on there, we're going to be creating a platform and a podcast actually inspired by you. So I really want to get people who are sort of in that sustainability world, and then investors and the sort of institutions and commercial real estate and I want to get them all together to talk like today. So that learn from each other.
Brian Briscoe 41:58
All rolling. All right, once again, what we'll have that in the in the show notes, and there's a lot of room for sustainable technologies and sustainable stuff, you know, for lack of a better term in multifamily. And, honestly, it makes sense from a business perspective to, you know, lowering those energy bills, you know, lowering those water bills, also. So, anyway, Mandy Morgan, so happy to have you had both you guys on the show today. And it was a pleasure. Thank you very much.
Mandy McAllister 42:27
So great. Well, Brian, and thank you for what you're doing for women, we applaud you.
Brian Briscoe 42:32
Thank you very much. You know, I've got four daughters, and a wife. And you know, it's just, it's just one of those things. I've got a mother too. But, you know, it's just one of those things where I want my daughters to have, you know, the same opportunity as my sons. And it's just something that back back to the mindset. I wonder, you know, how many women don't get into multifamily investing or don't get into certain fields? Because there's not a good women woman role model? That could be part of what it is. And yeah, in my mind, if I can just put a couple of, you know, women role models on display, you know, maybe that'll do a little bit to change things. Maybe it'll change things for one or two people. And that's all we need to do.
Morgan Fielder 43:17
I always started with a shift in culture, right? Like, you have to just get that ball rolling, and then all of a sudden, it just becomes normal.
Brian Briscoe 43:24
Yeah. Yep. And I think, you know, a friend of mine named marine for asking me the question, you know, this happened two or three months ago, outside of Starbucks on a rainy day, is investing in real estate can be more difficult for me, because I'm a woman. That's what she asked me. You know, and that's what brought this all about is I sat down and I thought about it, you know, I'd already done a podcast, I'd already released 30 episodes. And I went back and looked at my episodes, and I had two women on my show out of 30 episodes with two people on every episode, you know, so it's just like, yeah, whoops, I inadvertently did whatever it else did. So
Mandy McAllister 44:03
well, we appreciate your focus on lifting us up. Because if you can see it, you can be it.
Brian Briscoe 44:11
If you can see it, you can be it. Yeah, that's that's something else. You know, I can take that in for a long time. But Good, good. Good, good, good. Anyway, relationship business. Women are pretty. So you know, and women are also what about 50% of the world's population? I don't know. And we control more of the wealth. So there you go. All right. Well, thanks for thanks for a great episode. And that's it for today.
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