The Mello Millionaire with Tommy Mello - Fail Forward: Ari Rastegar on Lessons That Built an Empire in Austin

Episode Date: October 3, 2025

Ari Rastegar is the founder and CEO of Rastegar Property Company, a $10 billion real estate empire that’s reshaping skylines across the U.S. But his journey didn’t start in boardrooms—it started behind the grill at Johnny Rockets, flipping burgers and dreaming bigger. From those humble beginnings, Ari built his way into the world of high-stakes real estate, earning the nickname “The Oracle of Austin” for his early bets on the city’s meteoric growth. Known for his bold, contrarian strategies and unshakable belief in learning from failure, he’s turned setbacks into stepping stones and vision into value. Ari has been featured in The Wall Street Journal, Forbes, and Bloomberg, and is recognized as one of the most innovative minds in real estate today. His mission? To show that with grit, resilience, and a willingness to fail forward, you can turn even the smallest start into a billion-dollar legacy.Check Out My Social Media:Tiktok  ⟶ https://www.tiktok.com/@officialtommymelloInstagram ⟶ https://www.instagram.com/officialtommymello/Facebook ⟶https://www.facebook.com/thomasmello/My other podcast:Home Service Expert ⟶ https://open.spotify.com/show/4WHQ3ldGThHsP1cfzNF33GLive Q&A submission form:https://homeserviceexpert.com/questions00:00 The Journey of Failure and Success01:24 Building a Billion-Dollar Portfolio03:07 The Importance of Relationships in Real Estate10:07 The Role of Money and Time16:18 Predicting Market Trends and the Future of Real Estate18:57 Embracing Technology and AI23:25 The Gift of Failure and Closing ThoughtsTMM Director / Series Creator - Elaina SlaytonExecutive Producer - Jim Leslie Producer - Bianca Zhou Editor - Paul McAleavey Camera - Cullen Fleming

The only thing that I've got really good at at this point in my life is failing. And I promise myself, you know, at Johnny Rockets one day that if I ever got to the other side, I would tell the truth. And the truth of the matter is this experiment experience, which is this life that we're in now. The other side of the coin is failure. Contrarian, resilient, trailblazing. Our guest today is known as the Oracle of Austin for his bold approach to real estate and wealth creation. All success is about a nerd.

is about action. Ari Rastigar is the founder and CEO of Rastigar Capital, a private investment firm with a portfolio built around recession resilient assets including multifamily, office, and industrial properties. To me, failure is learning how to win. His career path has been anything but ordinary. He went from flipping burgers to becoming a lawyer to launching his first real estate investment firm while still in law school in 2006. Today, he's built a reputation for spotting opportunities and scaling them into long-term success. You know, real estate at the end of the day is about people. While some investors chase trends,

he focuses on assets built-to-weather downturns and thrive when the market gets tough. This is sustainable growth based upon solid fundamental economics. Ari believes that the greatest returns come from thinking differently and playing the long game. Get ready. This conversation will change how you think about risk, resilience, and rewriting your own path to wealth.

Okay, guys, welcome back to the Mellow Millionaire. Today I'm in Austin, traveling actually for work and going on a hunting trip and Ari was nice enough, Rastigar, to be on the podcast. So Ari is the visionary founder of Rastigar Property Company, a real estate investment firm, redefining how people live, work, and thrive. Dubbed the Oracle of Austin, he built a billion dollar portfolio spending from multifamily, office and mixed spaces with a focus on innovation and sustainability.

So you are born and raised here. You started out with a $3,000 loan 10 years ago and you built just a $1,000. a massive real estate portfolio. Tell us a little bit about the story. I'm an attorney by trade, you know, but it took me a while to get to that. I didn't want to even go to college between you and I and my dad said, you know, being an Iranian immigrant and having the dictatorial, typical Iranian father, said after you become a lawyer, you can be an exotic dancer for all I care. Didn't do too well in middle school or high school had a terrible speech impediment and kind of uncomfortable in my own skin and had to go to a couple of communities.

community colleges before Texas A&M was kind of dumb enough to let me in, but I graduated number one of my class and delivered pizzas all through college and was trying to get it together. And then while I was in law school, I was building single family homes, like in between, you know, in between classes, little houses that I used my scholarship money to buy a little lot for $3,500 and met a local builder. And, you know, he built it and helped me get a loan. and I was on the construction sites in the morning and in class in the afternoons. And it was something.

And now, where are you at today? What are you looking forward to doing? Well, real estate is about people. And that's really what I love. You know, as a corporate litigator before and just seeing people on the worst day of their lives every day, wasn't, you know, wasn't something that interested me too much. But building community is really what is really. what I love. But we've designed this beautiful futuristic multifamily, single family home, little Texas Town Square, little elementary school that actually just opened in August. And just how

there's this 60 acre of green space that really holds that community together is the things that we really, really love. And, you know, we've built a lot of different stuff from industrial facilities to apartment complexes. We've owned apartment complexes. We've owned a apartment office, self-stores. I'm pretty sure we've invested in 38 cities, 13 states, and just about every asset class. And I guess if you build, if you build everything that we own today, meaning on the hundreds of acres of land. And if you build all of it, it's worth a little over $10 billion. Wow. And I own 100% of the company.

And never took corporate capital at the corporate level. There's like this unspoken rule that nobody will give you a billion dollars in equity to start. And so we just passed our 10-year in business mark in February. And so over the next six to nine months, we're going to start having some dialogues to go do something fun. So what kind of internal rate of return do you try to shoot for? We're singles and doubles, guys. You know, we're not shooting for the moon. And the downside risk protection is way better, yeah, is what we look for.

And so if I can make, you know, between a 16 to an 18 IRA and effectively with that, means to your point is the average return that you make on a yearly basis. And if you look at our audited track record, we've been able to do that in some very difficult markets. I mean, COVID, a bunch of stuff that people can complain about, but therein lies the opportunity, so to speak. But we're not looking to make huge returns because making huge returns means you took huge amount of risk. 100%. So in the beginning, you didn't have access to none of this stuff. And you made a lot of cold calls. What's one cold call that changed everything for you? I made, so I was sitting in an office. Great question. So I'd invested in an office building in downtown Dallas through another operator. And that's really, as I said, we started in the business. I knew a bunch of great real estate guys for my time in New York City. And I was fortunate enough for them to give me allocations and this stuff, whether the apartment, they were doing storage, they were doing office they were doing.

So we took a sliver of this building that used to be KPMG's headquarters, the big accounting firm. I basically made a list of all the financial advisors that were in the Dallas area. And I was, you know, calling, you know, 50, 60, 70 a day. And we, you know, kind of branched out. And, you know, there was a lot of long, long, long phone calls that lasted, you know, three to five seconds. And then something very interesting happened. After about six weeks of making hundreds of dials a day.

The rest is history. So how did you get in the right rooms when no one knew your name? I mean, is that just grit? Yes. Yeah, and I would go in New York City to this Italian restaurant called Il Milino. I got to know the bartender. His name was Elvis. And I'd go sit up there and being a big tipper goes a long way.

And whenever wealthy people would show up, they'd call me. And I'd go up and I'd sit at the table. It would be these situations that were curated that seemed to be serendipitous and seemed to be happenstance, but they were cultivated. And so they were cultivated. You got to meet them, talk with them, and getting to know all the people at these places, you become irregular. And when those people start to like you, and then other people there start to like you, something happens when you create an aura in a situation where several people like you, strangers very quickly alchemize it to friends. And if you can create a situation where you're around people that genuinely love you and they're going to go tell all the thing, all you have to do is nod and smile.

So how do when friends influence people, let the people talk more, smile more, be there for them? How do you feel like you're able to really develop a relationship? Because that's a lot of people say I got a lot of friends. And it's very hard once you get over like 20. I don't have that many friends at all. My best friend is in the other room. We've been friends in seventh grade. And he's the chief of staff of our firm.

but there's a big difference between friends, acquaintances. There's buckets of how those work. Asking genuine questions about people that I could potentially have a commonality with is how you create and build a friendship or build a relationship. And it starts by asking a meaningful question. And when they give you a meaningful answer, dovetailing that with sharing something personal, and that compounds over the courts of 30 minutes, 45 minutes an hour. You do that four or five, six, seven times.

You start having commonality. And once you have commonality, you have empathy. And when you have empathy, you have everything. I love it. You know, there's two guys that come to mind. John Rul and wrote Giptology passed away. Steve Sims just passed away. Wrote a book called Blue Fishing.

And both these guys were really good at building relationships. And it's just these little touch points that I'm trying to get better at with the people. If you're intentional with your relationships, it opens so many doors. Building really authentic relationships is a text message a couple times a week of, hey, bro, what's going on? You know, what's the latest or something versus some grandiose gesture, you know, once a quarter or some, you know, some, you know, sterile, impotent email to all of the people. Well, you know, the real deal is I catch up with buddies. Sometimes I unfortunately go a year without talking to them. And when we get together, I tell my friends, look, I'm busy, you're busy.

I had one of my best friends in my backyard recently. This was like in the last year. And we grew up together. And I showed him my schedule. And he's like, dude, fuck that. He's like, are you kidding me? And I'm like, this is the way I like things. Because some of the things are like, do 100 pushups, call your mom, read this book.

There's so many different elements than just money. Yeah, money is on its face is not interesting. Money is a tool. Money is a catalyst. Money on its own is absolutely worthless. I've made money. I've lost money. But the point is money itself is not a thing.

It's an illusion that it's a thing. It's a tool and it matters who's holding it and how that's actually facilitated. I've had billions and billions of dollars go through my hands throughout my career. And I'm just getting started between you and I. But it's also, like you said, like everything in nature is busy. Everything. The birds, the bees, the plants, the trees. Everything is busy.

So not being busy with some sort of. of action, you are neglecting your part in the hole. I always see readers or leaders. When I was starting my business, when I was 22, I met this CPA that only work with 10 clients, very wealthy clients. And he's like, dude, I like you. He's like, I'm going to give you tips along the way. He's like, I might even work with you.

He's like, but you got to do me a favor. He's like, what's the last book you read? I was like, kill a mockingbird, I think, in 11th grade. And he's like, well, listen, this is called the Emyth Revisited. Go read this. And then he gave me the richest man in Babylon. And then I went back two days later. And he gave me the ultimate sales machine by Chet Holmes.

And those were the first three books that got me obsessed with reading. I was like, I didn't know books like this existed. So I'll tell you a story. My daughter when she was in kindergarten, my oldest daughter, they were had that point in the class when they say, so, you know, what does your mommy do? What does your dad do? And they'd go up and, you know, I know the teacher obviously very well. And she goes up there and very proud.

said, my daddy is a reader. So it became this thing. I am a voracious reader. And there's no limit to the amounts that I read. But I'll tell you something as a lifelong personal development, you know, a guy like you, because I'm a nobody from nowhere. Like, whatever I am, I built this guy out of nothing. And there wasn't much to work with between you and I.

But what I can tell you is as an English literature major, Okay. Reading the greatest books in the world was my profession effectively. And I have found there to be more substance and more expansion in reading the best novels in the world than reading any of the personal development books. For example, give me your top three. Oh, no, well, I'll tell you, if anybody is listening to this that has not read 100 years of solitude by Gabriel Garcia-Marquez, or if you're in America and haven't read Moby Dick, Dostoevsky, Crime and Punishment, the Idiot, Chekhov, Dickens.

You're doing yourself an injustice, and the reason I say that is reading the greatest novels in the world, expand your possibilities. What do I mean by that? If you read Dickens, you read Bleakhouse, as an example. You're not just reading a book. You're studying a time in history when it was written. You're seeing a social commentary.

You're reading a vernacular from a particular, country, state. So you're getting a history lesson. You're getting a human psychology lesson. You're learning about relationships. And by digesting that deep in your subconscious, you're expanding your ability to dream. I want to ask you three questions that are repeats. I got a million questions here. So we're going to go over time a little bit. What's one piece of game changing advice you wish you knew in your 20s? I'd be telling myself that in this particular time space, time is much more limited than I treated it at the time. At that age, I thought that I had all the time in the world,

and I thought time was moving slow. I went to classes. I came back, and I found myself sitting around a lot, even though I was working, even though I was studying, and going back and looking at the things that could have been done with a little bit more intention would have compounded into something even more profound. You look at Warren Buffett that has all the accolades and just the name itself creates something.

He wasn't a billionaire to who was 65 years old. He's made 99.9% of his wealth after 70. The greatest thing he ever did is lived in 95. Well, it's true. People underestimate what they could do in 10 years, but they overestimate what they could do in a year. I think so much of the very hard work that I have done in my life. And I'm no stranger to sleeping in my office for days at a time. You know, when my kids were young, I would go home at some point and be out at the office and not see them awake for days at a time.

You know, working those frenetic hours is very much in my DNA. But looking back, seeing how bad of a strategy that was in hindsight, if I would have started a little bit earlier, the smaller little bits of effort, my own work, so to speak, could have turned into strategic delegation much earlier. If you were to start over tomorrow with $10 million, what would you do with it? Start over with $10 million tomorrow. I would spend at least a year traveling the world. And during that one year, I would spend a year planning the next 10 years. And I would do that in a capacity in different cultures, different climates, eating different foods, experiencing different body movements.

And I would go and use that time. to really, really plan, feel emotionally, spiritually, physically, things that I had not felt before to awaken parts within me that had not been awakened. And then from that place, be comfortable walking into the unknown and letting the plan on the 366 day dictate what I was going to do. It's very interesting. I love that.

I think a lot of people, you get kind of this trap of comparison and just a lot of people. and if you get on social media, which I do, it's probably a mistake, but I got to post all the time. This is kind of nature of the beast, but I just can't believe how many people just have nothing better to do than insult other people and get into the debates with people they've never met. Only miserable people do that. 100%. Only miserable people do that. And at this point in my life, finding a place of actual love for those situations really changed the way that I look at my life.

And for most of my life, I would consider myself a pretty angry person. Yeah. Yes. Mad at myself, mad at the world, feeling entitled. Something was owed to me. My family in Iran were very powerful to say the absolute least and came over and started over. We weren't Muslim. They killed our whole family.

And so there was a, and this is the story of a lot of Iranian Americans that are here in Texas, California. You kind of knew that Austin was going to be explode. You also knew in 2006 that storage was going to be a good industry. You kind of are able to see things before they happen. What do you think? What are the signs? Austin is a town on steroids. It's not a city.

Growing up living in Dallas, going to law school in San Antonio. We don't say the H-WR. These are metropolis. They're built with infrastructure, highways. They're expansive. Austin has real geographical barriers. You know, it was a little sleepy hippie town.

It was music, you know, music hippie town. Nobody really anticipated Austin. I know in hindsight, there have been some very flattering things that people have said about our thesis. I wish I could tell you I was as clairvoyant then as it has appeared. to be. But the truth the matter is, people have certain core values that make them spend money. Water is one of them. Nature is one of them. And live music. So meaning there's these tribal things with this two million-year-old reptilian brain that sits up here. And the behavioral aspect of humans, as unique and interesting as we all like to believe that we are, um,

we're not. We're amazingly similar and amazingly repetitive and amazingly predictable. If you look at the cycles that go through real estate, you look at the debt cycles that happen through global economies, you can almost time them to the day of how they will repeat themselves. Keeping things as simple as possible, but no simpler has been our guiding, our guiding principle along the way. But what are your thoughts with? AI is probably, I mean, I don't know if you know Peter de Montes and what's going on or just this idea. But I do believe Bill Gates, I mean, he said in 10 years, you're going to decide if you

even want to work. Next year, Elon Musk is coming out with his robots. That'll do cooking, walk the dogs, simple things around the house. and you talk a lot about technology. You're a big fan. You told Forbes you embrace technology because you're a hybrid. What do you think we're going? The way that I've been taught about artificial intelligence, an example,

is the same way you would look at electricity, meaning it's not a separate thing. Right now it's being one-dimensionalize as a thing. Artificial intelligence is over here. But in fact, it's going to become the underpinning and an activation catalyst. point for all the other things as an underpinning, not unlike electricity. Electricity turns on these lights, turns on these things.

So we don't think of electricity as much as its own thing because it is now become ubiquitous through everything that we do. That's the place where AI is coming. So in this fourth industrial revolution, it's the equivalent. And electricity, just so you know, was like the Facebook of its day. It was a fight between, you know, between Cornelius Vanderbilt, between J.P. Morgan, between Nikola Tesla and Edison and John Westinghouse. who is actually the one that had AC current with Tesla before J.P. Morgan shorted the stock and bought all the trade bar. It's fine. It's, again, not its own thing as much as it is a catalyzing piece that everything else is going to sit on top of to enhance its productivity. And as that productivity hybrid changes, things were evolved. Just like there's no yellow pages anymore. There'll be something else that'll come beyond that. So I believe this is the most interesting and exciting time.

to ever be alive for so, so many reasons. But technology, I think, at its best is an extension of humanity. I'm going to go through rapid fire questions here. What's the first real estate book every entrepreneur should read or book in general? If you're listening to this podcast and you're starting your entrepreneurial journey in real estate is something that you find to be interesting, I love the first rich dad, poor dad. I read it the first time when it was a 13-year-old boy, you know, reading that book the first time,

just putting it in a perspective that I could digest, I could visualize, I could see the difference between making money work for you versus working for money. And then when my father gave me thinking, grow rich, at about 14 or 15 years old, that foundational piece, drew the thing, drew it all together. But I think anybody that is on this journey and has an appetite, back to that word of hunger,

whatever that means, spending time reading the best novels in the world, pick one. Go back to Huckleberry Finn. Any book that is a book, I believe will expand your capacity. What's the most expensive lesson you've learned?

That I learned was the astronomical price of procrastination. Last question before we close out. The Sunbelt or coastal cities? Where is the smarter about right now? So the Sunbelt as a region has population migration trends on its side for now. People will migrate to beaches as they have for a variety. There's energetic reasons even. Having your bare feet in sand has a grounding mechanic that, you know, actually heals your body.

And there's a certain part of us being salt water. And the way that the waves in the ocean move is by following the moon because it's the largest, closest thing to it. So waves follow the circle. The moon, that's the ocean exists. You are a saltwater being. The whole universe, and this is what I tell people, stop acting so small. The whole universe is inside of you, quite literally. So because of that, there is a gravitational pull quite literally to the coast.

Why I say the framework matters, most real estate investment funds are in seven-year cycles. And with two one-year extensions, seven to nine years. In the seven to nine year, the only place to be is in the sunbelt. Period, hard stop. If we had this question on the larger debt cycle, people are going to be right on the coast and they're just going to be there. The social issues, California, New York, Memdani, is irrelevant because the gravitational physiological, spiritual pull that we have to oceans

will make coastal cities valuable across the world to the end of time. I love it. What's your book called? The gift of failure. The first line of the book is, I hope you fail. I hope you fail a lot. That's all I've known how to do. The only thing that I've got really good at at this point in my life is failing.

And I promise myself, you know what, Johnny Rock is one day that if I ever got to the other side, I would tell the truth. And the truth the matter is that this life, this experiment experience, which is this life that we're in now, the other side of the coin is failure. I always say when I get on stage, I'm probably the biggest failure in this room. I just fall forward a lot and I embrace it. I'm going to have you close this out on anything you want to talk about to finish us up. Right now at this moment, there's so many things that are going on in the world that are, forcing people either to wait because of uncertainty, whether economic uncertainty, global uncertainty, there's so many reasons right now if you read the, you know, read the

headlines, which are only designed to draw attention. That's all headlines and all the media, I should say, is designed to do. TikTok, they're buying attention. Now there's an algorithm for how much your attention costs, quite literally. I would take a moment to close your eyes and sit in silence. To close your eyes for a second and sit in that divine silence and listen. All right. You're the man. This has been a pleasure. I need to go sit down and close my eyes more. Thanks so much for listening to this episode. Like always, we're going to close it out with the Tommy Truth, which is a little slice of wisdom from me to you that can help guide you in whatever you're striving towards right now. One of the biggest mistakes I see with young

entrepreneurs is they're trying to grow a business into a lifestyle business. What happens is a lot of the people say, I want these things now. I want to buy a nice house, so I got a larger mortgage. I want this nice car, so I got a bigger lease or rent payment. And that's a mistake. You should be thinking about the outcome of the company. That's where true generational wealth comes from. That's where your mindset should be. Not how much money can I extract from this business today as W-2 income. So just remember, build a business that's worth a lot of money. Don't think about getting rich every year based on the draws you're taking from the business. And that's it, guys.

We'll talk to you next week.