BiggerPockets Real Estate Podcast - 342: From Duplexes to a 64-Unit and Self-Storage Millions with Kris Benson

Episode Date: August 8, 2019

From buying duplexes to a self-storage empire! Today’s guest Kris Benson sits down with Brandon and David to talk about his remarkable journey across all kinds of different real estate asset classes. Kris began with a successful sales career and explains why he transitioned into owning real estate instead. You’ll love Kris’s story about how he built a 64-unit apartment complex (in a cornfield), how he found partners to bring the project to life, and how it all started with one phone call! He also shares why he now invests in self-storage, how he evaluates properties, and why he believes this asset is recession-proof! Kris provides great advice for raising money and finding your niche, and explains his theory that “deals create deals” as he walks through his journey. This is a fantastic show full of great content. Download today! In This Episode We Cover: Why he transitioned out of a successful sales career How he got started with a duplex and built up to a large commercial real estate portfolio How he acquired 20 small multifamily units—and hated it How he built a 64-unit apartment complex from the ground up How he got involved in a condo syndication project How he began finding the right partners to build multifamily projects with His theory on “deals create deals” Why he now invests in self-storage Where to find data on self-storage and REIT’s Why he believes self-storage is recession-proof How the best opportunities in his life have come from cold calls to property owners or friends How he learned his skillset and why he sticks to it His advice for raising money from others And SO much more! Links from the Show: BiggerPockets Forums Kris's first BiggerPockets Forums Post BiggerPockets Store BiggerPockets Shirts Mindy's BiggerPockets Profile BiggerPockets Money Podcast Buck Construction Apartments.com City Point Capital BiggerPockets Podcast 227: From Single Family Houses to $130,000,000 in Multifamily with Joe Fairless UpWork Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 342. And so that became our first commercial multifamily project. We built from the ground up a 64-unit part-with-coctawks in Rome, New York, which is in central New York. And it was the beginning of the light bulb for me. When that happened, then I realized, oh, okay, this is how you scale a real estate business. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn about real estate investing without all the hype, you're in the right place.

Stay tuned and be sure to join the millions of others who have benefited from biggerpockets.com. Your home for real estate investing online. What's going on, everyone? This is Brandon, host of the Bigger Pockets podcast here with David the Man Green. What's up, David the Man? How you doing? I'm doing really good. I actually just got back from Atlanta.

I was recording some real estate stuff for CNN, talking about, bigger pockets and house hacking and all these other cool terms like burr that you brandon came up with burr that's awesome well your book is selling really well i know that i was on an instagram the other day and there was a poll i'm sure you saw this somebody did a poll and they put your book and my book and they said which book should i read first did that and it was a book on rent a property that make you mad no it made me excited because i am happy for your success because you're like they i think it dominated like 66% to 33% should read your book but your book's been out for like 12 years in mine's been out for six months. That's part of it. But I feel like you're,

you're Dr. Dre. You're Dr. Dre and I'm Eminem. Like you found me. You made me. So like my success is yours. Yeah, but you're still the godfather. You can never, ever be topped. Well, you're doing good stuff, David Green. Speaking of real estate books, that brings us to today's quick tip. Today's quick tip is short and simple. Do you know Bigger Pockets is actually also a publishing company? Many of you know that because we talk about books a lot on the show. But just to make sure you've seen all of the newest books that have been coming out. Just go to biggerpockets.com slash store, sT-O-R-E, and you can check out some of the books

that we have there. And one more side, quick tip and a half. We actually have some t-shirts for sale now on bigger pockets. Biggerpockets.com slash shirt. If you want a shirt and you want a rocket shirt that looks like something that I wear, because I wear all of our shirts, biggerpockets.com, forward slash, forward slash, that's why that sound weird. It doesn't. You're making it weird.

Sounds funny. It's only weird if you make it weird. It's only weird if you make it weird. All right. Well, with that, end it today's quick tip. You've upgraded how to buy properties, but did your insurance get the memo? When investors start scaling, insurance can't be an afterthought. Most policies were designed for a single property, not multiple rentals, LLC ownership, short-term stays, or properties mid-rehab.

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That's N-R-E-I-G.com slash BPPod. Here's why savvy real estate investors are obsessed with bonus depreciation. It lets you take that rental property or commercial building you own and depreciate most of the cost against your income. legally, 100% IRS compliant. That's instant cash flow improvement. Cost segregation guys is the number one firm nationwide, specializing in identifying these faster depreciating assets in your property.

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So wouldn't it be great if you could actually earn money while you're traveling? Well, you can. Airbnb has something called the co-host network. While you're away, you can hire a vetted local co-host with hosting experience to help take care of things, communicating with guests, preparing your space, managing reservations, everything runs smoothly while you're off making memories. Your home might be worth more than you think. Find out how much at Airbnb.com slash host. And now, without further ado, we want to bring you into the interview with Chris Benson.

Chris is an awesome real estate investor. Done a lot of different things. Everything from buying rental properties. You got the 20 units hated it. And then he shifted and pivoted over to apartment complex. They actually built one. You're going to learn all about that. That's crazy. And then you shifted to something that a lot of us haven't talked a lot about or thought a lot about and that self-storage. And he goes into a lot of the benefits and the good and bad of that.

And that's really, really fascinating. Also, he talks about his, I guess, one of the biggest lessons he's learned about cold calling and how some of the best opportunities he's got in life comes from cold calling. All of that and more here on the Bigger Pockets podcast. So without further ado, let's get to the interview with Chris Benson. All right, Chris, welcome to the Bigger Pockets podcast, man. Good to have you here. Thank you so much for having me, David, Brandon.

It's a pleasure. Awesome. The pleasure is ours. All right. That was very creepy the way you said that. I'm not going to lie. The pleasure is ours. All right, Chris. Tell us about yourself. I mean, how did you get into real estate? Walk us through that beginning journey. Yeah, so I think mine's an interesting one. So my background, when I came out of college, I worked for a B2B sales company. So ADP for your listeners out there, maybe who are selling some B2B stuff. It was a payroll company. And that was my first job out of school, slinging payroll to companies with less than 50 employees.

employees. And soon after that, I get into medical devices. And so my background's always been built around sales. And my last job was with a company called Intuitive Surgical. They make the Da Vinci robot, which is an incredible piece of technology if you've not seen it before and an incredible company. But at about the age of 28, 29, I distinctly remember waking up and saying, I can't do this for the next 30 years. made a ton of money and I you know that part was great but the downside was my life work life balance was awful so you know I was traveling a ton usually three to four days a week I worked like a dog and in return I got paid for it um about that 29 year old arena I realized that time was the biggest

thing I didn't have more of right so everything else was replaceable I made a little bit of money and that didn't really make me happy I bought some toys that didn't really do anything and so for me it was about capturing time. And so I looked at a number of things, passive income, kind of rich, dead, poor dead type mentality. And I'm not really creative. I couldn't conceive myself building a business, but I'm pretty good.

I'm an executor. If you give me a task and say, hey, Chris, go do this. I can do that pretty well. And so real estate fit that skill set for me, because it's numbers, right? As I started into what underwriting was, I said, oh, I can make that work. And so that was the start for me.

So, Brandon, to answer your question, my first endeavor into real estate was a duplex in the county that I live in. Okay. I bought it. My brother was actually moving into town, and I bought it as a opportunity for him to move in easily. My parents were actually the loan on it. And that was the journey. That was the beginning of it. So it was an interesting start, and I don't know how far along the journey you want me to go, but it accelerates quickly.

That's good. We'll dig it in. Before we get there, I do want to read this. Indy, the Bigger Pockets community manager and host of the Money podcast, she sent me this message and said, hey, here's Chris's first post ever on Bigger Pockets. Over in the forums, I don't know if you've seen this or remember it. But yeah, it just says, hey, my name's Chris Benson. I'm a father of two. Currently live in Saratoga, Springs area.

I'm 33 and seem to be having a midlife or not so midlife, bit of a crisis. And it basically said that. Like, I'm interested in buying hole, which allowed me to ultimately replace my income. I'm going to be looking to bigger pockets for networking opportunities. What's cool about that is like going back and you can do that with almost anybody in the site. You can go back and look at my first post or David's like, it's funny like where we all come from to go back in time a little bit and be like, oh yeah, you are brand new.

You're just saying, hey, I'm excited about real estate. And a lot of people listen to the show right now are exactly where you were five years ago. They're leaving posts just like that. And I remember distinctly listening to the first few series. I think I started listening in the double digits of bigger pockets podcasts, you know, when it was you and Josh. And Josh. and I distinctly remember thinking,

wow, it'd be great if I was on the bigger pockets podcast. Like, things would have gotten. That's awesome. Really good. So, yeah, I'm super happy and grateful to be here. And look, it's been six years. I'm 39. I'll be 40 upcoming.

And, man, it's incredible when you take the perspective of where you were just that short time ago. You know, I mean, it sounds like a long time, but in the span of your lifetime, and it's a blink of the eye. Yeah. Yeah, that's cool. Anyway, I love to see that. So let's walk through.

Like from that point where you're listening to the podcast, you're asking questions, you're in the forums to where you are today. So what came next? You bought that duplex and then you decided, wow, I love rental properties. I'm going to buy hundreds of them, right? Kind of. Okay, walk us to that. What essentially happened was I was naive and dumb.

And so I think maybe you said it, Brandon, maybe you're the guy should have given credit to all this time. Somewhere along the way, I heard or read if I could have a net income number, right so it was it was a net income per unit and basically for me it was 200 bucks i said okay if i can make 200 bucks net per unit per door that i was buying yep 50 units make 10 grand a month i'm pretty close like that'll give me enough to at least walk away kind of from my job now fortunately i was making more money from that but my lifestyle was fairly we live fairly modestly so we could make that work so that was the beginning and and so brandon um that is what i started to do is buy

some duplexes in the area. When I got pretty close to about 20 units, I realized that it was awful and I hated every bit of it. We had put together a pretty good management team in regards to plumbing, landscaping, you know, bad things going wrong. But the piece that I still controlled was the people part. All of the tenant issues, big boy issues, came to us. And I realized very quickly that I hated it. And we were dealing with, honestly, class B minus C plus type properties. which cash flowed pretty well, but, you know, I don't mean to sound elitist, but the clientele that we were putting in these facilities wasn't awesome. So what happened next was, and again, I don't remember who said it.

Otherwise, I'd give them credit. I heard or read big deals and small deals are the same amount of work. You just make less money on small deals. And I thought to myself, oh, that's the problem, is I just need to go bigger. And so what happened was then I started doing homework into commercial real estate and commercial multifamily made sense to me, right? It got rid of all the issues that I was running into in the manner in that I could get a large facility with high class tenants and essentially mitigate that risk for myself. So what ended up happening was we sold the portfolio. I have one

duplex left. My brother actually still lives in it. So that's why I still own it. But that time may be ticking away soon. But we have one duplex left. We sold all that. And how I got started in commercial multi-family was I called a guy that I went to church with when I was a kid. He owned a construction company. And I said, his name is Steve Buck. I'll give him a little plug. Buck Construction of Whitesboro, New York. And I said, Steve, I want to build an apartment complex. What do you got? And it was a cold call. I literally hadn't talked to Steve in 15 years. And he said, hey, interesting you called. There's a piece of land in a town not too. far from where I grew up in. The municipality wants to do something there. Come have dinner with me.

And so, um, a long, long story short, that became our first commercial multi-family project. We built from the ground up a 64 unit in Rome, New York, which is in central New York. And it was the beginning of the light bulb for me. When that happened, then I realized, oh, okay, this is how you, this is how you scale a real estate business. So that, yeah, that was the, that was the beginning of the big boy real estate. All right. All right. So I want to dig into this.

I don't think, unless David, you can maybe think of them, but I can't think of any person we've had on the podcast ever who built an apartment complex. Like I just, maybe there was,

but I can't think of anybody. You're giving me so much better. So it's always people that buy something and then fix it up later. Yeah, you'd be the first one who built one. All right. So I didn't build anything.

Well, no. I solely relied on. Yes. Steve's expertise. I mean, honestly, and this is something for everybody listening, is the partnership thing for me has been unbelievably valuable. I know what my skill set is. And, you know, the details that go along with the development project, that's not me.

So I had, honestly, Brandon, I went in naive. That's the first thing. And then secondly, Steve and their company have been a fantastic partner for me. My role was really the equity in the deal. And I had a wife who was very risk tolerant and was willing to risk our life savings on doing this. But yeah, it was an incredible journey, incredible learning experience. Still to this day, we own it and it's still an incredible learning experience. Okay, so let's walk through some of those. Like, what does it cost to build a 64 unit apartment complex? Yeah, so it was in an interesting town.

So Rome, New York used to have an Air Force base there. It was called Griffiths Air Force Base. And in the late 80s, the Air Force Base went away. And so the town got decimated. I mean, 40% occupancy rates, rent growth obviously went down the tubes. There's been no development there in 20 plus years. So when Steve told me, hey, it's in Rome, I said, you're out of your mind. There's, you know, I just listened to Brandon Turner telling me about all the good metrics I need to have to build.

This is not where I was going. And in what, what ultimately happened was the land was dirt cheap. We literally bought a cornfield. There's 104 acres. We have option on 52 of them. And it's a cornfield essentially in the middle of the city. Like, it's surrounded on all side by residential. you're a mile and a half from where the Air Force Base used to be.

And the Air Force Base is now a tech park. So they have almost 6,000 employees there. And they've done all kinds of tax incentives to bring, you know, tech people in high paying jobs. And nobody lives in Rome because there's no housing. So our pitch for the original business plan was we were going to build class A or in that market. You can call it luxury housing. You know, think hardwood floors, granite countertops, steel appliances, two bed, two bass.

And we were going to be the only game in town because from a rent comp perspective, you know, we're 40% more than what the market was sustaining. But if you wanted to live in Rome and have an apartment that had granite countertops and stainless steel appliances, there was only one place to go. So we built it in 16 unit phases. How many? 16 unit phases. Yeah, four 16 unit phases to make sure that our hypothesis was correct.

That's smart. You know, I have one question about that. When you're going to build 16 at a time, it does make sense because you're basically saying, well, I'm only taking one quarter of the risk if it doesn't work. The problem is you have to run in the infrastructure for that entire thing and develop the land. Did you do, did you develop it all at once and then just build the 16 units at a time? Or did you run the infrastructure for 16 of them and have to do that every single time? So how the land was set up, basically without drawing you a picture, there are essentially two phases on the front piece of the parcel. we ran the infrastructure to there,

built the first two phases, and then ran the infrastructure to the second part of the parcel, and then ran the infrastructure, sewer water, electricity there. So we had, you know, when we started doing phase three, the infrastructure was there for phase four.

And when we started phase one, the infrastructure was there for phase two. So put that at half, David, where the risk was still there. But we were almost 100% confident we could fill 16 units. When we got to 32, we were like, I don't know, let's see what happens.

And we kind of rolled the dice. and it's worked out really well. So one thing I like about this is it confirms or gives evidence to something I've said many times on the show before. I'm a big believer that, and what I like to say is that even C-class tenants watch Chip and Joanna Gaines or like, you know, C-class tenants, D-class. I mean, even I would go to D. People who live in a D-class area still watch SGTV. And so what I mean by that is like if you can provide luxury, quote-unquote luxury housing, in other words, just a better than what's offered in an area that usually doesn't get that because everyone ignores that. You know, I tell the story often in my fourplex that I bought from my daughter

Rosie. It's in the worst neighborhood of my town. But it's my best performing rental and never has vacancy. I get way higher than everybody else because some people just want to live there and they are good people that live in those neighborhoods. So when you can provide that better than average or better when everybody else has. Because again, like yeah, if you will live in San Francisco or New York City or whatever, you're going to have your pick of nice places and have, you know, a but yeah, when you can provide those things. Anyway, that's cool that it worked for you. But like, so what went right, one wrong? Just one more thing about that.

I think it's a critical point, right? Is the risk is everybody wants to go in with comps, right? And there's something to be said for being first to market. You can only eat the first to market once. And so like you go on Apartments.com, right? And search apartments in Rome, New York. Well, our pictures look a lot different than everybody else's, right? So, you know, if you are in that market looking for to your point,

whether it's you're in, you know, class CD, or you're moving in, you know, to the area, which is what we were counting on, right? You have this big churn of employees. When you're moving in the area, you don't want to live 25 minutes away. You want to live five minutes away. And so that's what we were betting on. And I would give people, you know, being first to market in anything. It happened with us with intuitive surgical, my last corporate job. And with this real estate project, there's huge market share to be had if you can be first to market and do it well. That's cool. So walk us through. I mean, what, how much did it totally cost to do for the entire project? And then what went right? What went wrong? What listened did you

learn? So I would say that each phase, you know, construction costs went up because we did them basically year by year, right? So we would do a year. We'd get them leased up to a point where we'd said, okay, we feel like this will support itself cash flow wise. Let's build the next phase. And I would say each phase, you know, somewhere between 2.2 and 2.4 a phase is. And it, and it depends a little bit. And so, you know, that was the total cost all in. You know, I think the piece of what went right and what went wrong, the what went right part is the lease up. We picked the right market and there was the demand that we thought. And I'll give Steve all the credit in the world because I didn't go along dragging and kicking, but certainly he said, hey, there's people here.

And I was like, I'm going to trust you. I've been in the business for 30 years. I'm going to trust your judgment here. And he was absolutely right. So that's the good part, right? You know, the bad part, just with any construction, I will tell you that knowing what I know now, if I had known what I know now,

I probably wouldn't have done the deal the way that we did it. Because I went in naive, right? I knew nothing about development, and I was really on Steve's coattails and Buck Constructions, you know, and his son, Chris, who was the project manager, the whole way. And, you know, I didn't understand how contingency budgets should be formulated. I didn't understand, you know, how project managers should be managed, right? And there were some things that, you know, we were over budget on the second phase by a pretty

good chunk. Fortunately, we met up for it in phase three, but those are big, a $2.2 million project. You're over budget by 5, 6%. That's a big number, you know, for a single guy, you know, like for one equity source. So, you know, those are things that you learn along the way, but I wouldn't have done it any other way. There's something to be said about just jumping in. and you have to have great partners you can trust along the way.

And for me, that was it, right? I was willing to jump in and I had a partner who I could trust and kind of put his arm around me and said, hey, this is going to be okay. We'll make it through. But knowing what I know now, like just in real estate and development, I probably would have looked at the deal a lot differently. Sure.

So when you were building 64 units in the middle of a cornfield, how many times did your partners have to say, if you build it, they will come for you to feel comfortable. When you say it like that, it makes me feel bad. I'm not going to lie to you. Like, I was feeling pretty good about myself. But when you say like what you just said, I kind of want to be like, yeah, that was dumb. Yeah, but it worked for Kevin Costner, right?

I just got to believe. It's that's the moral of the story. What do you know, right? Your favorite movie and you ended up doing the exact same thing. That's awesome. I would think anybody who would take on a project of this size for their first time would go over budget. Like, that's almost be impossible not to. So five or six percent, I was expecting like 20 percent that you were going to tell us that went over. Oh, if it was just me, David, I absolutely.

I had a construction guy who's been in the business 30 plus years. He's built thousands of units. And his family has a pretty substantial portfolio as well. So yeah, I was really trusting the expertise of him. If I, if you had trusted me, I'm pretty sure I'd have been bankrupt. Nice. Well, that's, but that's a part of it having a good business is having the right people and the right seat on the bus. Okay, so what came next? Where did you end up doing after that? And where are you now with your portfolio? All right. So in the middle of building that, I had a friend that I grew up with who syndicated a condo project in South Boston. And I didn't even know what syndication was. He called me one day and said, hey, I need to raise $900,000. I'm going to flip this row house in

Southie. And I said to him, where do you get the $900 grand? Like, it's not your money. Where are you going to get it. And he's like, oh, you can syndicate it. I was like, what's that? And so when he told me how syndication worked, that, and I'll give him a quick plug to because he's exploded. I don't know if you guys know about South Boston, but that market has been unbelievable for the last 10 years. Ever since Goodwell Hunting came out, right? Everybody wants a piece of it. A little bit after that. Goodwill hunting is pretty rough. But he runs a company called City Point Capital and they're doing, you know, huge commercial development deals now. But when I saw syndication, that's where I said, oh, I'm a salesperson, right? That's what I do, right? That's what I know.

That's what my skill set is. And when I realized that people wanted access to this asset class, that's when I said, ah, that's what I'm going to go do. I'm going to go raise other people's money. That will allow me to accelerate much quicker. And I'm going to just build my own apartment complexes. That was my first step, David. And what ultimately happened was as the 64 units came online, And I saw the operations, which we were running originally. We were doing it ourselves. We were our own management company because I wanted to understand and see how the business worked. And then we very quickly, third party managed that out.

When I did that, I realized I hated operations. I wanted nothing to do with that either. Not too dissimilar than what we did in our duplexes that we had owned earlier. So when I realized that there was one more light bulb that hit for me. And it was I met Joe Fairless on. bigger pockets, and realized what he was doing. And I said, oh, there are commercial operators out there who will take equity and in return give you back end ownership on their projects. So I had accumulated a fair enough size group that wanted to invest alongside of me.

I had a lot of my peers who knew what I was doing and said, hey, next deal, I want to be involved. And that's where it really came together for me was then I realized I don't want to be the operator and I'm going to make mistakes, but I can go partner with a professional real estate operator, whether that be multifamily, and that's where we started, was in multifamily. And they've already made the mistakes. You know, I'm a professional salesperson. That's what I've done for 20 years. They've done multifamily for the last 20 years. And so for me, David, that was my next, was I said, I'm going to go find two or three operators that I really like operating in markets that I love and I'm going to raise money for their deals and earn back end ownership and in turn

cash flow off of that. And so that's what we did. And we invested in quite a few multifamily projects in Atlanta, Phoenix, Dallas, the Fort Worth Metroplex. And that was really the start of what I was scaling why I left my job was I realized that people wanted access to an asset class that was non-correlated to the stock market. And I was playing to my skill set. I knew enough from an underwriting perspective where I could underwrite an operator. And then I could bring that to myself. And I was investing alongside in every deal.

And also my peers, you know, who wanted a piece of that asset class as well. Yeah. So here's what I love about this. It just shows like this tremendous self-awareness that you have. In other words, like you were like, I don't like, I mean, your whole story is this, right? I don't like owning these duplexes or the small. small properties. Okay, I know that about myself, so I'm going to make a change.

A lot of people live in their garbage, like, life that they don't like for decades, right? It's like, oh, I hate owning these rentals. I better keep owning them. Or I hate this job. I'm going to keep working this job forever or whatever it is, right? So you were like, I don't like this. I'm going to change it. So you try something else.

Okay, that was all right. I learned some stuff. I don't like that. I'm going to try something else. And so you're constantly figuring out, what do I like? What am I good at? And then you said, hey, I'm a sales guy. I'm good at the sales side stuff.

Well, how can I use my skill and put that. into practice. I can start getting cash flow without that. So recently, a similar story. So one of the best wholesalers we've ever had in the show, Lance Wakefield, and I started talking. And he's got this tremendous good skill at finding good deals. And I'm like, he's one of the best I've ever known at finding deals.

So basically I just said, well, why don't you find deals for me? And that's all you do and you bring me deals. And so that's how we kind of form this mobile home park thing that we're doing right now together. It's because he recognizes what he's good at. I know what I'm good at. David, I know what you're good at. Chris, you know what you're good at. And so by understanding what you're good at, it actually makes work fun. It makes like things enjoyable because like you're doing what you're doing what you're not good at. You're just never having fun. And then what's the

point. So anyway, I love that about your story. Brandon, it's a great point, right? Why not do what you love to do? There are people who do what you don't want to, right? I mean, Upwork is a great example. Like you can go on Upwork and hire anybody for anything. You know, and those people exist in real estate too. And for me, that's been my whole journey. And to where I am today in the storage piece, it was, I did something really well and that skill is translatable. What you did differently than other people is others are waiting to find what they think their skill is before they start. And you jumped in and did it and were like, well, I didn't like that part. How do I leverage that off? Or how do I find a partner? You knew what needed to be replaced because you took action.

And that's just, that's the scary part. Nobody wants to jump in until they feel like they know what they're doing, but you're not going to figure it out until you do that. David, you learn nothing until you're in it, right? If you wait until you know everything, you'll never do anything. It's just the, it's just the fun of the game. Like it's like, it's like waiting to be strong before you go to the gym. Right, right. And I can tell Brandon's pumping iron.

Oh, yes, he is. That's because, uh, that's because we're holding each other accountable to that. Yeah, David's always, but you're so right. You're so right. And I think it's something that when you talk to people like, hey, how did you do that? That's the thing. I jump. And it's not easy.

Let me be the first to saying like, I don't want to sound like I didn't have second guesses and I wasn't anxious and I wasn't fearful. That's not my personality. Like I am okay with risk, but I don't like not knowing what the outcome is. For me, like I was okay taking the risk, but what really bothered me and to this day still bothers me. I don't know how this ends. And that's the part for me that it's still eats at me. And it is a thing you have to be comfortable with if you're going to grow and change. Or to your point, Brandon, 10 years from now, you're going to be looking at yourself in the mirror saying,

crap, I should have done that. Yeah. And I think that's, I'll always say it's, Brandon, I'll let you jump in. I think that's a piece of life that people have to understand is you don't usually know where you're going to end up. You're exactly right. The way it works in practical terms is you start down a path and that path opens doors and then you go those doors and your path changes in another direction and then it branches off from there. And as long as you continue moving, it's like you're part of a tree that the branches keep growing and you're making more money. But there's no way that you can know what opportunities are going to come once you start. So you started with a phone call to a friend and you said, hey, I want to build an apartment complex.

You had no idea he's going to say, well, I've got the land and it's in a cornfield and I know what I'm doing. That was an awesome opportunity and you took advantage of it. Then things went wrong. And you said, okay, I want to do this again, but I want to do it in a different way where we're not going to go over budget. I met another guy. He did this way. I jumped in with him. You had this track record so he was likely to work with you. Then that opened up doors to the next thing. And that ability to move forward, not knowing where you're going to end up, but knowing it'll be something good is really what separates the people that find success from the ones that are just always frustrated. Let me give you one more, Bram.

And just before, I know you want to say something. I'm sure it's going to be. No, that's right. Take it. So there's a guy, do you guys know who T. Boone Pickens is? He's a natural gas parent. I think he's still alive. You got to read some of his books.

He made a bunch of money in natural gas. And he has a quote in his book that I loved. And it was deals create deals. He's like, I walked into so many things thinking I was going to do one thing. And it went a completely different direction, right? Another opportunity presented itself. And so I have a son who just graduated high school. a couple weeks ago.

We had his graduation party last Saturday. So, you know, he's in a part in his life where he's trying to figure out what the next step is. And I said, and his name's Noah. I said, Noah, look, you don't need to know what you're going to do. You just need to know what's next. And then go do that. And other things will present themselves and be opportunistic. Don't be afraid to jump at what the next thing is.

It may work. It may not work. But it's okay. You're going to learn and you're going to figure out, David, to your point. You're going to find out what you like to do. And you're going to find that next opportunity. or that next partner. You're going to find that person who thinks like new,

but maybe has a different skill set. And that's it, right? I mean, if you want to change, that's how you got to do it. That's so good. Brandon, you're kind of going through that now. Do you want to elaborate on kind of like how that experience has been for you?

I mean, yeah, just the short, shortly. Yeah, I mean, my goal was to buy like 50 units and now I'm up to like, what, 300 and I got another 700 possibly that are coming through. Like, I might 10x my goal and like, yeah, crazy in like three months instead of three years. I always say like you can either like push like you can you can like try to push your way like through like a difficult like to the next level right you can like walk your way there you can try to get there on your own or you can get pulled there and I'm a bigger fan of getting pulled there and you do that by like doing something that's like extra and then like that now that's working like for example I put a job description out today for a job I'm hiring for and like by time this goes live I'm sure it'll be filled but we're looking for an asset manager anyway I'm a little bit nervous like I've never hired like that. kind of that level of role before. But you know what? Now,

now applications are coming in. Now I got to do something. Now I'm getting pulled to that next level. So I'm a big fan of getting pulled to the next level rather than trying to forge your way there, like slowly. With willpower. With will power. Nobody will ever get there.

So I like to do like, I hired a personal trainer. I'm meeting with them in like three hours from now, like an at the gym because I'm like, well, I want to build some muscle. So I can just go try to do on my own or I can actually schedule an appointment. Now I have to show up because I'm getting pulled there. So anyway, to use one more analogy because I, I'm going to take David's analogy king ability today. What you guys are talking about, I use the analogy often on webinars where I say,

if you're driving down the road, I was in the Pacific Northwest for years, right? So you're driving down the road in the Pacific Northwest, it's always foggy in the mornings especially. And so you're driving your car and you can't see a half mile up the road because it's too much fog. You can't see if there's a deer in the road. You can't see if the road turns. You can't see anything. I mean, the world could be exploding up there and you just don't know, right?

So you have two choices. You can just pull over to the side of the road and complain that you can't see a half mile down the road or a mile down the road, or you can just keep driving because in a fog bank, you can always see a little bit in front of you. And so the only thing you shouldn't do is stop. But that's what most people do, right? Most people in the world, they're driving. Thanks.

Yeah, they're driving through the fog and then they pull over. There might be a deer up there in the road. I don't know. I can't see that. But little they know, everybody has this zone of clarity around them. And as long as you keep moving forward or get pulled forward, that zone of clarity continues to move with you. That's a great way to you got it.

Thanks. David, I don't know if you were the analogy king before, but he's taking the cake on that. I know what lights out. He does that. That's how Brandon is. He does it with quotes, other people's quotes. He takes them. He takes some your ability as the analogy person.

What I always say is, I wish I could remember who I could give credit to. I know who it is. I just don't say it. Then people are. Brandon's going to steal that too. That's going to be how you know a quote bite is coming. He's going to, I wish I could remember who said this, but that is going to drop it. A wise man once gave analogy about a fog bank and driving through it.

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Things like occupancy, delinquency, and net promoter score. have the results to prove it. Go to mine.co slash show me to see how mine performs and get your first month free, which is much cheaper than learning the hard way. So walk us through, Chris, where are you at today? What is your focus today? What are you been working on? Are you still doing the raising money primarily? Where are you at? So I made a huge turn about a year ago. So let's use the fog analogy. So about three years ago, one of the operators that I had raised money for came back and said, we're done buying multifamily. And I said, what?

They said, you know, market caps too tight. Everything's dropped too much. We're not comfortable with the value we've created. And I think they've only bought one deal since then. Now, the company has over a billion dollars under management so they can afford to wait, right? And so for me, that was a big catalyst to say, oh, maybe I should be thinking about other asset classes. And so I started going out and doing some homework on other asset classes that I wanted to be a part of. There were two that I focused in on.

one was self-storage and the other was senior housing. I think the runway in senior housing is a little longer because there's a lot of demographic information supporting it. There's 10,000 people turning 65 a day. So there's a little bit more of a runway, but what I fell in love with was storage. And I'm going to give you three, my three pillars for storage. A lot of our investors ask this question is like, why storage?

And these were literally the three things that I wrote down and said, this is the reason I want to be a part of self-storage. And one is the returns. And I can send you the link to where I got this data. It's the National Association of REIT data. I don't know if you guys have ever looked at N-A-R-E-I-T. But it's an incredible database. They have 25 years worth of data of all the publicly traded reeds.

And you can look asset class by asset class. You can look at timber reeds, health care. Anybody who's got a publicly traded reet, it's in this data set. So I looked there and storage in the last 25 years did just, under 17%. And when I saw that number and then compared it to apartments, apartments was just over 13, which is still fantastic. But I said, oh, my, like, I always thought multifamily was sort of the end-all, be-all. And so that was my first, you know, oh, wow. And then the second one was what I always look at is what happened in the last recession. So I believe that the markets are cyclical.

Everything that's going to happen is already happened. You just have to look back far enough to see it. And so for me, it was looking at what happened in the last recession, 2007, 8,9, storage lost less than 4%. And so apartments, it was close to 7. The S&P 500 for a little bit of baseline was down 22%. So for me, you know, that was the big aha moment. I said, okay, returns were fantastic, did really well in the last recession. And then the third piece, and this is why I am where I am today, and this is where I think the biggest opportunity is, is in storage less than 25% of, the market is owned by six reits. Well, it's five reits and one publicly traded company called U-Hall. Everybody knows them. So they own about 20, 25% of the market.

The rest is all over the board. Well, it's not all mom and pops. There's regional operators. Like I'm a partner in Reliant and we're a regional operator. We have 48 properties. Okay. But there are still a ton of mom and pops, Brandon, to your point, which provides, as you guys know,

huge opportunities just to run the facilities like a business. So that was for me why I made the jump into storage was I knew there was a runway. And my belief is that institutional capital is always going to find yield. And right now, they are pouring money into multifamily. The cap rates that you see in multifamily deals are embarrassing. I don't know how anybody's making any money. But just like you brand in with mobile home parks, you're hoping the same thing, right? That institutional money is slowly coming into mobile home parks and the same thing happening in storage. So I believe that there's this window of, you know, three to five years, which is based in the only gut,

where we can build a monster portfolio in storage and be there for the exit on the back end as more institutional capital pours into the space. So that's really how I got to storage. How I got to reliant, David, is an even better story than the first cold call. My best opportunities in my life have come from cold calls. And so what happened was I was an investor first with this company. And how I got to them was I started calling the list of the top 100 self-storage operators.

I didn't call the six reeds because they probably didn't need my money. But I just started calling people and saying, hey, I have a little bit of equity. I'm interested in the space. Do you guys need cash? And so I met a bunch of self-storage operators and one of them was reliant. and I fell in love with the team that runs Reliant. And so I was an investor first. And then about a year ago, one of the principals and I sat down to dinner,

we were going and looking at a property, and he needed help raising money. And I had quit my job. And I said, oh, I raise money. And so we worked long, long, long, long story short, we worked out a partnership where I came in at the company Reliant Investments. And my job now is essentially to raise capital to fund our portfolio acquisition. That's so cool.

Yeah. And again, it goes back to what you do best. You recognize the cold call thing and building the connections with people. Like that's what a sales guy kind of does, right? But I think that's awesome. Very, very cool. I guess how you shifted that as well as how you move from one to the next to the next, you know, getting involved with people, learning. You invested with them first, then became, you know, actually part of their company.

And now you're doing, you know, self-storage. How many units total does Reliant have now, do you know? Yeah, just under, we have just under 30,000. Wow. Just under 4 million square feet. It's 48 properties primarily in the southeast. So Florida, Georgia, Carolinas, Arkansas, Alabama. We got a little portfolio on Colorado, but we're just third party managers there.

Yeah. Yeah, that's that's fantastic. Again, I love the stories on the podcast here because you just hear like no two stories are the same, right? Like everyone's got their unique journey and they're figuring it out based on what they like, what their skills are. You figure out you fit in really well there and now you're doing that. And by the way, all those reasons you shared on why you like self-storage,

yeah, this is exactly what I've been thinking with mobile home parks is like, I look at these multi-family. I mean, I'm invested in multifamily funds as well. I like multifamily, but I look at them and I'm like, there are so many operators out there that are relying on aggressive rent-raising

at a time in the market where I'm not sure we can aggressively rent-raise. Maybe we can. I don't know. Aggressive like, you know, cap rates staying super low forever. There are all these like things that are like, every deal I look at from these large multifamily, like everything has to go right in order for them to make a lot of money,

which it very well might. And that's what they're claiming. Everything's going to go just fine. But if not, if the market does start to shift, how do we hedge against that? And that's exactly why I'm like, I'm getting so heavily in the mobile home parks and I'm creating a fund there

because like I got to hedge against that with something that's going to do well no matter what happens. And I think you're thinking the same thing. Yeah, Brian. I mean, you bring up a great point, right? With mobile home parks,

people don't leave. It doesn't matter. It doesn't matter what happens in storage. And it'll be interesting to see what happens in this next correction. But the hypothesis is Americans don't get rid of stuff. You catch them on the way up. They're buying things. They put it in storage.

And then when they downsize, they don't get rid of their stuff. I can't tell you how many units I've been to where the things in the units are worth less than a month's worth of rent. Yeah. Yeah. People continue to pay us rent. Yeah. That's the same way the gym owners make money is they just start taking the money every month and you don't even realize it's happening.

So, David, my wife owns a gym. Just, you may be having a theme here. It's about 15% right. 15% of the people who pay you every month actually come to the gym every day. It's crazy. Crazy to me. Well, I want to point out something that I think is really smart about what you're doing other than the stuff you just mentioned. the psychology side. You and Brandon are both investing in conservative asset classes,

comparatively speaking, in an aggressive market, which is what Warren Buffett says to do is you want to be fearful when others are greedy and greedy when they're fearful. When you're in a market where everybody else wants conservative assets, like a recession where everybody's afraid, that's really when you want to be really aggressive, yes. And most people, they just get it the backwards way because it's easier to follow the herd. But what you guys are doing is you're recognizing cap rates are so compressed. How is anyone making money? It's really just all this institutional money that is like it's pushing it down i it's fake that it has to have somewhere to go and it's just taking over like the blob just getting bigger and bigger right and you guys are like well

let me get out of the way of this train that could be coming right down the the pike at me and you're buying in conservative asset classes that other people are are ignoring well i can almost guarantee you that when we have a recession and all of these companies that bought at a three cap now they have some vacancy they weren't expecting or their investors want to pull their money out because interest rates went back up and they could go get a CD in a bank for 6% instead of the 4% return they're getting on whatever, that you're going to go buy those assets. That's when you're going to make your aggressive moves. And it's really so much more simple than all of us want to make it when trying to make

these decisions. You know, it's just you cannot follow the herd. You can't say, well, everyone else is doing it, so I'm going to do it too. That's why people bought houses in 2005 and 6 when they shouldn't have been because everyone was doing it. It's why people let their houses go to short sales in 2010 when they shouldn't have. They should have held on to it and it would have come up. it's just making that mistake of thinking because everyone else is doing it, I should do it too rather

than understanding the fundamentals. That's human nature, right? I mean, that's just not just real estate. That's everything in the world, right? I mean, it's the reason why there are high performers and there aren't is there are people who are willing to say, that doesn't make any sense. Even if, you know, what I say to my son, I have a younger son 13, his name's Luke. And I say, Luke, just because all the dogs are barking at the same tree doesn't mean it's the right tree. Just because everybody goes that direction, it's probably wrong. Because most of the time, everybody's wrong. Yeah, that's really good.

You can use that one, Brandon. A wise man once said. Well, I was going to go, I think it was Edison that said like, I can't remember. It was something like when I wake up too many days in a row realizing that I'm following the herd, I got to change. I don't know. Some quote like that. But anyway, I'm going to butcher it.

It's funny. When he quotes himself, he knows the exact thing he said when he actually tries to give someone credit for a quote. Something that was smart. I don't remember. A wise man was said. All right. Let me go here.

It's not like, so raising money. This is your skill. This is your superpower. This is something that I'm fairly new at. I mean, I just built my very first fund. I'm trying to figure this part out. I'm raising money.

And what tips can you give people, including myself? This is a total selfish question here, but hopefully help others as well. They want to raise money, whether it's they want to get a private lender on one deal, just to give them 50 grand for a cheap house, or they want to raise $5 million in a syndication. What's your best tips for raising private capital from investors?

Man, I would say it depends at what level you're trying to do it, right? The first thing you have to realize, and this was something that took me a while to get comfortable with, is money is time. So when you take other people's money, you're taking their time, right? It's taken them effort, time, energy to be able to accumulate that wealth to give to you. So you have to be very thoughtful and understand the responsibility that you have. have, and it's not for everybody. There are many sleepless nights, especially when I first started where I was like, these people are just trusting me. They don't know the deal. They don't know how to underwrite the deal. They know me. They know I've had a marginal level of success. And so they're

saying, well, if Chris is doing it, I'll invest with them. And that's a hard thing to come to terms with. And you know, you've seen Brandon and David, I'm sure on bigger pockets, this explosion of syndication coaching, right? Yes. The mini Joe Fairlaces that exist all over within the, you know, real estate world. It's the new timeshare. It's exactly what is. And it's, it's very scary to hear about how people are investing with people. Here's the advice I can give you is if you are raising money, make sure you know what you're doing before you take other people's checks. Yep. Right. Don't do it because someone said, hey, I can make an, acquisition fee on this, and in turn, I'll be able to pay my mortgage this month. My big thing

is track record. I used my own money first, literally life savings to build 64 units and didn't do anything until I saw that it worked, right, and realized how the levers behind the curtain worked. And then I said, okay, I can recreate that or I can go find someone who's doing what we did. For me, it was having a track record where I could point to, you know, by the time I started raising capital, a significant number of transactions that I could say, look, I'm not an expert, but I know more than you. I know enough to be dangerous. And I'm partnering with people who are the experts. That my whole shit, right, was I'm partnering with people who've been doing this 25 years. And so they've already made the mistakes, we hope. And they know where the sharks are in the water.

so they'll tell us where it not to swim. And so that was a big piece for me. And Brandon, for you, you have significant experience. It's all about trust. If you're raising money from individual accredited investors, right, you know, the guys and guys who are going to, guys and gals will throw 50, 100 grand. Yep. They're not underwriting the deal, right?

They're calling Brandon Turner and saying, hey, this guy's got 300 units. He runs bigger pockets. He's a brand. I'm going to trust him, you know? And so I think a big part of the. this is trust. Unfortunately, I think there's a lot of people who are just spraying and praying. And it's working, right? There's so much capital out there looking for investment right now. And that benefits me for sure. But, you know, I'm just, I want there to be an appropriate

level of cautiousness as you're taking people life savings or big chunks of their money and putting it into things that you may or may not know what you're getting into. So, you know, brand, I don't have that concern with you. I think you're, you know, I know your mentality's conservative. But as far as for guys who have a track record, man, go preach. You know, you have a huge platform here with the podcast, right? It's a thought leadership platform. You guys had Joe Fairless on the podcast. His entire business is built on his podcast. Right? I mean, he's got a real estate partner who really, really knows real estate. And then he's built a platform in which to go out and speak to people who want to understand more about investing. And those may be passive investors,

like guys who will put money with you or people who want to learn from him. And so, you know, I think having that thought leadership platform that you can build some knowledge and give away as much as you know to people, that's how you create that trust. And in turn, those people trust you, they see you, and they say, okay, I'm comfortable raising money that way. Fortunately, I've had a group that's grown organically over many, many years. And when I joined Reliant, now I have a platform with a 10 plus year track.

record that is unbelievable, which as a salesperson, right, it would be like when Todd told me that one of the founders of Reliance said, I can't raise money. I looked at him and I was like, that's like selling, you know, gum in elementary school, right? Like every kid wants to buy gum. So I looked at it and I was like, how can you have trouble doing this when your track record is so good? And so that that's kind of how if you have that track record and preach, you know, tell people what you're doing and why and give them the good and bad. that's a thousand. I mean, I've invested in stuff in the equities market that I have no idea how I lost money on it.

It just doesn't, it's irrational to me. So you're not held to any different standard. This also explains well why, like people sometimes wonder and have been asked, why do people take time to answer so many questions on the Bigger Pockets forums or write blog posts or do all this work? Like, they're not paid for it. In fact, people have said to us like, well, you know, when we talk to them about writing for the Bigger Pockets blog, they're like, well, why would I do that?

I'm not getting paid. And I'm like, you don't understand. Like, if you look at almost every writer on the blog, almost everybody who's really involved in the forums that are like answering questions all the time, they're not doing it just out of the generosity of their heart. Yes, they're helping. They're giving back.

But they're giving information. They're becoming thought leaders. And those people are raising money like hand over fist. Like I've said the story before about one investor that we had, I talked to a while ago, said, uh, he just by helping on the forums occasionally, he doesn't do that much, but just being helpful in the forums, he, somebody was reading a forum post, contact him and said they wanted to make a initial test investment with him of just a small $20 million. Like they didn't want to start like just stupid money because he was clearly a thought leader and they found him through the forums, which, you know, anyway.

So encourage me to people who are out there like if you're not sure how to get out there and start like helping, just get out there and start talking with people in the forums. If that's, if nothing else, it's totally free to do. And again, use your skills for what you can do it. So Chris, can I give an interesting. Oh, sorry. Go ahead. No, I was going to move us to the next. section, but go ahead. All right. So just capital raising on a whole. We're about to go into a whole new

new world. We've done a lot of capital raising with individual investors, right? And we still are. But I recently started my new cold calling campaign in a new world, university endowments. Really? So do you know how much money the top 20 universities in the United States manage in their endowments? Just plenty. A lot, but I don't know. Yes. Billion dollars. David. Yes. 10 billion. $500 billion. One half of a trillion dollars is at 20 universities. Crazy.

And so when I saw that, I said, oh, those guys need to get into real. And interestingly, they already have. So one of the leaders in the endowment space is Yale. And almost 12% of their portfolio is in direct real estate. And they're kind of leaders in university endowments. So what I would say to you, Brandon, as you go out and start to raise them, I'm happy to have this discussion offline with you as well. Oh, yeah.

Oh, yeah. There is so much capital out there looking. So we've talked to Yale. They will not deploy less than $75 to $100 million per investment because they're, they manage 30 plus billion of capital. So anything less than that isn't worth their time. Yeah. And think of that.

It's just like, that's, that's insane. So anyways, there's plenty of capital out there to be had if you got a great product. Yeah. That's really cool. Yeah, this came at such a good opportune time for me right now, talking with you about this because this is exactly where I'm at in my business. David Green's been thinking the same stuff lately. You know, what are we good at?

What's our strength? Where are we at in the market? What should we do next? So this has been really, really good. But before we get out of here, I do want to shift over to the next segment of the show called our deal deep dive. Deal, deep dive. All right, the deal deep dive. This is a part of the show where we dive deep into one particular deal that you've done.

that's a lot of D's. Let's go, let's go into it. Number one, Chris, what kind of deal was this? What kind of properties are you this? It's a self-storage property. We'll continue the theme of self-storage. It was a commercial self-storage property, a ground-up development deal in Naples, Florida.

Okay. And how did you find this deal? So interestingly, one of the partners of Reliant had dinner with a guy in Naples, and the land was his, or he controlled an option on the land. and they made a connection over dinner, talked about what we did. And so the land came to us.

He was a JV partner in the deal. And once we saw the land and went through our underwriting process, we knew it was going to be a home run. All right. How much was it? What did the numbers look like? Yeah. So the original,

we purchased the original land and all-in cost was just over $9 million to do the construction of the building and the land. And he actually threw the land in the deal. as equity. So that helped us with the debt side because we had to raise less equity. We raised just over $3 million for that development deal. And essentially the business plan was just built around, right, getting this facility up and out of the ground. We were going to make this sort of our flagship property because it's in a great spot in Naples. And there wasn't easy, there was no way there was a competitive threat being built in like a four mile radius because of where it was

placed. All right. Okay. Well, I was going to say, how did you negotiate that? But was there any negotiating that was done? Was it just a land price? You had to negotiate? Yeah, it was, I mean, it was really around the equity that we gave him in the deal as the landowner. Because ultimately, he's relying on our intellectual property to essentially build the property successfully and manage it.

We manage all our own properties as well. So it was our management company that was going to run it. So really, the negotiation was built around. How do we get him in it? And interestingly, for the equity side, we had. had a letter of credit that allowed us to raise the equity from one source. And that worked out phenomenally because it was a short-term term term. The original plan was to build it, get it leased up, refinance it into a permanent debt.

And then it was going to be a six to eight-year hold. Okay. So that kind of answers the funding thing. So what did you end up doing with it? What's like, you built the thing and you're still holding it or what's up? No. So this is one of those home runs that I don't mean to just throw this out as a great story because I like the bad stories on podcast too.

but this one's too good than not to tell. So, and this is back to where I think the strategy is from the institutional capital. So we built it. We ran it for about eight months. It was just over 20% occupied when we got an unsolicited offer from one of the public reits, the public-traded reeds. And I can't tell you who it is because it signed a non-disclosure agreement. But we sold it last year in April.

And essentially, they gave us the value we had projected in year six. and they gave it to us in just over 18 months. So we all have the property for less than two years and essentially tripled investors' money. So it was a huge home run for us, a huge home run for our investors. And our goal is to churn that money. So investors want to come back

and do another project with us. And so, you know, basically their equity multiple was a three. So if you invested 100 grand, you know, just over two years, we gave them 300 grand back. So that's awesome. Everybody was pretty happy with that one.

Do you ever worry about spoiling investors? investors on a rock star deal like that. They're going to come back. They're going to be like, well, last time you got me, you know, way better. Yeah. You're, Brandon, the, the investor expectation. Yeah. Is a huge challenge in this market, specifically because the last 10 years of real estate

have been so good. Yep. Right. So everybody, our average deal, we're underwriting an IRA in that mid-teens, right? So our investors see those mid-teens. We have investors come back and be like, well, you know, I want to see mid-20s. I'm like, well, yeah, me too. Yeah.

I can make the spreadsheet say that if you want me to, but that's not where we think the market is right now. And there's something to be said for this next correction. We'll recalibrate investors mindset. Where right now, you know, they put money in anything to make money. Yep. Yep. The next correction is going to.

It was a lot like 05 and 06 when a regular Joe would just buy a house and next year it was worth 150 grand more. Yep. And I'm not trying to say that we're in the same kind of a bubble as we were before, but that mindset that it should be easy. is what should cause caution, if that makes sense. And yeah, there's a lot of pressure on you if you tripled returns in two years to come back with, you know, an even better deal or to repeat that.

And then that puts pressure on you to start to make riskier moves, which is really what you're trying to avoid when you're using other people's money. Fortunately, fortunately, David, like we're in a position where the track record's long enough and we're not underwriting to those numbers ever, right? I mean, this one was we've been the beneficiary of a compressing cap rate in the asset class. Right. So our average IRA on the 20 deals we've sold is just over 45. Well, we're never underwriting that number. You know, any point out now is, you know, 12, 14.

I guess I meant more for not maybe your company, but for syndicators in general, when people start saying I'm expecting a 25% IRA, then you're more likely to get an inexperienced underwriter who's going to say, okay, well, let's find a way to get them that because that's what they want. That's how people lose money. I have similar pressure on me with coming up with analogies, right? You hit a home run and then they want an even better one the next time. It's, I hear you, man. Or bring the same level there.

Or bring the tops one on you like the fog. Yeah. And then you're up against it. Exactly. I have an identity crisis. Why am I here if you can do this too? This is the only thing I was bringing. All right.

Awesome. Last question. What lesson did you learn from this deal? The opportunistic. This was a deal that the land part was a huge pain in the butt because of it was just a challenging, it was a challenging negotiation. And there were a lot of times that we were about to walk away. But we were steadfast in the opportunity that existed in this particular states.

I was trusting that, you know, Todd operationally knew that storage was going to work here. But I knew market-wise, there was nowhere else to go. It was kind of a similar pitch to the apartments. If you wanted storage in this corridor and there was a ton of residential development, it was right here. And for us, how we look at everything opportunistically, David where, you know, people ask like, well, what's the plan? Are you going to hold six years, eight years? Well, we're going to hold until we can create the value we told you would, right? So if we can, if we can turn it sooner and get your money back to you, then we're happy and you're happy, right? So I think

for us, we're an opportunistic operator where we'll look at anything. And like I said before, deals create deals. You never know where you're going to go as long as you're open minded and say, hey, let's look at it. We'll turn the rock over and see what's under. Yeah. Yeah, that's good. That's good. All right, dude, that's awesome deal deep dive. Yeah, self-storage fascinates me.

If I wasn't so focused on the mobile home park thing right now, I would definitely go more into there because I think it's a fantastic model. I think it's good at this time of the market. And I don't think people are getting less junky in their lives. Like, they're just getting more and more crap. So, all right, very cool. Yeah.

So I'm going to skip actually the fire round today, the questions from the Bigger Pockets forums, because actually, like, half the questions we had pulled, we've already covered today. Like, what are the best tips for approaching private lenders? So we're going to skip that for now and just head right over to the next segment, which is the world famous. Famous for.

All right, this is the famous four. The same four questions we ask every guest every week. But before we get there, let's find out what's going on this week over on the Bigger Pockets business podcast with Jay Scott. Hey, guys, this week on the Bigger Pockets Business podcast, we have a guy who's previously appeared on this podcast. His name is Jesse McHugh, and we dive deep into how he solved the biggest headache he was having in his property management company, and he did that by starting his own cleaning business.

We talk all about how he used technology and systems to scale past 100 employees to grow that company. Don't miss this great episode, and don't forget to subscribe to the Bigger Pockets Business Podcast. We'll see you on Tuesday. All right, with that, let's get to the famous four. Number one, what is your favorite real estate related book? Is it a cop-out to save rich dad, poor dad? It is not a cop-out. That's what I answer to.

If it is, then we're both cop-outs. That's the quintessential I wish my dad had given it to me when I was 15 books. Yep, yep. Sorry. I'm right there with you. It's all right. All right. The only thing better would have been to say my book, but whatever, you know, I don't care.

I don't care. Move on. He may have a chance to redeem himself. What is your favorite business book? Brandon Turner. No. Sorry. That's right.

I would say I just read, and it's just because it's top of mind, the trillion-dollar coach. Eric Schmidt, the Google CEO talked about the coach that they had at Apple and Google. And it's a really fascinating story about how he impacted the business, both at Apple and Google, and some great tidbits to take in the aspect of your business. Very cool. I saw it in the bookstore, like the Amazon bookstore, right? I didn't get it. I'll check it out.

Number three, David Green. Tell me about some of your hobbies. Oh, man. So we have two boys. We're very outdoorsy. I would, if I had to pick, skiing would probably be my one. If I could live out west,

Jackson Hole would probably be one. I'm not quite there to take the kids out of, you know, society yet. But skiing is probably my one. I love a mountain bike. We have a pretty beautiful lake right by our house, Lake George, which is unbelievably gorgeous. So anything outdoors is usually where we'll lean. All right.

Very cool. And my final question, Chris, what do you think sets apart successful real estate investors from all those who give up, fail, or does never get started? Man, I think we went over it. And I don't mean to beat a dead horse, but it's just jumping. You have to do something. And look, I appreciate you to read my first post. like I was there too, right?

Like you sit in bed and you read forums. You're like, oh my God, look at this guy and look what they're doing. And there's so much information and it's overwhelming. But you have to jump. And I'm not saying do it stupidly. Do as most education as you can on, you know, what you're trying to do. But then you, the only way you're really going to learn is to jump in and see what happens. And it's not always going to be good, but there's no question that you'll take

something out of that experience. there you go so true very cool well chris this has been fantastic thank you for being on the show it's cool again to see your journey over the last five or six years going from new you know wanting to get into real estate understand the power of it to just crush it and making things happen it's been fantastic so uh final question i'll give to david green to ask and then you can take us out tell us where people can find out more about you yeah for sure uh we have a i have an education website with a lot of free content on real estate investing at Chris Benson.com. It's with a K, K-R-I-S-B-N-S-O-N.

I'm fairly active on LinkedIn. So if you follow my profile there, and then if you go to Reliant Investments, Plural.com, so R-E-L-I-A-N-T, investments, plural. There's a ton of stuff about Reliant and our platform there. So by all means, please reach out. I would love to chat more with your listeners. Awesome.

Awesome, dude. Thank you very much and we'll see you around. David Green. Take us out. That was amazing. Thank you, Chris. This is David Green for Brandon, my analogy sidekick Turner. Signing off. You're listening to Bigger Pockets Radio, simplifying real estate for investors large and small. If you're here looking to learn about real estate investing, without all the height, you're in the right place. Be sure to join the millions of others who have benefited from BiggerPockets.com. Your home for real estate investing online. Thank you all for listening to the Bigger Pockets Real Estate podcast.

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