Join us as our host and Attorney Kim Lisa Taylor and Syndicator Vinney Chopra preview their upcoming one-day virtual event called "Learn How to Syndicate Real Estate in One Day."
What is real estate syndication? Pooling funds from private investors so you can buy more and bigger real estate deals of any asset class.
During this podcast, Kim and Vinney — both pros in the real estate syndication world — will discuss what it takes to successfully syndicate real estate, the top mistakes beginning syndicators make, and what holds people back from achieving their investing goals.
Episode at a glance:
Join us as our host and Attorney Kim Lisa Taylor and Syndicator Vinney Chopra preview their upcoming one-day virtual event called "Learn How to Syndicate Real Estate in One Day."
What is real estate syndication? Pooling funds from private investors so you can buy more and bigger real estate deals of any asset class.
During this podcast, Kim and Vinney — both pros in the real estate syndication world — will discuss what it takes to successfully syndicate real estate, the top mistakes beginning syndicators make, and what holds people back from achieving their investing goals.
Episode at a glance:
Kim Lisa Taylor:
Hey everybody. Thank you all for coming to Syndication Attorneys' free monthly podcast. We will also be posting this on our YouTube channel. Both our podcast and our YouTube channel are now called Raise Capital Legally, so please subscribe to our YouTube channel. We're trying to get our numbers up. We'd love to have subscribers there, and we'd love to see your comments.
So anyway, the whole point of these is to talk about topics of interest to real estate syndicators and fund managers, with the opportunity for live questions and answers before we sign off. I am attorney Kim Lisa Taylor. Before we get started, please note that this event is recorded. It is going to be put on YouTube, and we are going to use it for future promotion, post it on our website or use it in a broadcast available to the public. You can ask questions at the end of the broadcast by raising your hand or typing it in the Q&A. I see we've already got a question. We'll save that till the end. Information discussed during this free broadcast is of a general educational nature and should not be construed as legal advice.
Today, our topic is “Learn How to Syndicate Real Estate in One Day,” and this is a preview of a one-day event that Vinney Chopra and I have put together and that we're going to be offering for everybody for a really low cost. Vinney is going to share his expertise and knowledge on finding deals and analyzing deals, due diligence, making sure you're doing the right deals, talking to investors, and actually raising capital. And I'm going to be talking about deal structures and securities exemptions and making sure that you're following the rules and how you can legally create defensible relationships with investors so that you can market any deal to them.
So we're going to give you guys all of it in one day, and you're going to have exactly what you need to be able to go out and start launching your business. We're going to offer some other supporting materials during the day — free bonuses — so if you come, you'll get the free bonuses, and we just love to be able to help all of you go from where you are right now to where you want to go with your syndication practice, and Vinney is our best example of someone who has exemplified that over a period of time. So Vinney, thank you so much for coming.
Vinney Chopra:
Oh, Kim, such a pleasure. Such a pleasure to be on your show together. And on April 27th, we'll be together also on Saturday. Saturday, seven hours of action-packed material that you and I have prepared, and we would love to give it to lots of people to really get going, take that first step or second step or even 15th step. I really gave a lot of credibility to you because when I started 16 years back with the duplex in Odessa, Texas — by the way, I still own the duplex. Can you believe it? — and then we bought 14 units. Everybody watching us today, I've reached over a billion dollars in the portfolio, but it started with 14 units at $180,000, and then now I hear it's worth $1.9 million. I sold it at 380. I think we sold it at 380 after five years or so. But no, I'm very excited to be with you. Yeah.
Kim Lisa Taylor:
Yeah. Vinney and I have known each other since we both started in this industry. He was my very first-ever syndication client when he first started syndicating, and so we've kind of grown along this journey together and it's been amazing. We've been amazing support for each other along the way, and we just want to be able to share everything we've learned with all of you. So what do you think, Vinney? I know when you did those 26 — you did 26 multifamily properties — and that was only over the space of about eight years.
Vinney Chopra:
That's it. Exactly. With my old partner and myself, 26, we did it in maybe even less than that. I think that, yeah, about eight years or seven years. You're right. Then I started Moneil Investment Group company in 2014, which really took off big time and all that. But you are right. I would say, Kim, you need a coach and you need fabulous attorneys to work with you. I mean, I give so much credit to you because in the syndication world, when you talk to people, they say, "Oh no, you're going to get sued. You're going to have this. You'll have trouble with investors." But I always have thought, “If you hire the right professionals, like Kim Lisa Taylor, an SEC attorney, everything will be fine.” And you have made it fine.
Kim Lisa Taylor:
Well, part of what I think it sets us apart — and I'm not trying to make this a commercial about us —but we're really, really invested in making sure that you understand what you're doing. We don't want to just throw you some legal documents and go, "Here you go." We want to make sure that, number one, you understand why we're giving you the documents you're given and the purpose of each one, but also making sure that those documents have the maximum flexibility that you will need along the way to make the right decisions on behalf of your investors, not having to get their input on things that you should be able to decide on your own, but also the ability to reopen that offering and get new money in if something happens.
For example, the markets change, you're at a point where you have to refi just like a lot of people are right now, but their property values are depressed. The loan value ratios have decreased, so now all of a sudden, if you want to get that refi loan, you have to bring in more money. And so we've created documents that allow our clients to be able to do that without having to go get permission from your investors or without having to penalize your investors that don't want to put in more so you can go get the money from other people that are willing to invest. Or maybe certain investors want to put in more money than they have to.
So we constantly evolve our documents based on the real experiences of our clients. And so somebody comes to us and says, "How do we transfer this? How do we do that?" And we look at the process that we have in our docs, and if it's too cumbersome, we streamline it, we make it better, so the next time it's better for everyone. So that's, I think, been a big help. I know we've used some of those provisions along the way for you…
Vinney Chopra:
Totally, totally. I know you saved me. There haven't been that many downfalls, but one property in effect, I can remember, where the investors wanted to really say, "Hey, we don't agree with this or that, all that." You were so kind to really give it a look and tell me my legal rights and how the syndicators in the operating agreement … we say that the LLC is going to protect the general partner and the legal fees are paid by them and all and other stuff.
The biggest thing I would like to say to everybody watching us is that multifamily, as you know, last three years, has changed a lot, and it's really good to get more knowledgeable and also find out how deals can really work since, with seller financing, with special situations … I'm really getting into senior assisted living, as I was telling you, Kim. And not only that, in multifamily, I've been building 94 units, but then Monica and I decided we are going to go into RALs — residential assisted living — also, because it's one single-family home, but it's got 10 rooms. So 10 rooms are like 10 units, so it's a multifamily, and each room brings $5,000 rent. So 10 people. We just went to Arizona and we toured nine properties there. But the key thing is one single-family home will produce $50,000 in revenue rent, which is just like the multifamily.
Kim Lisa Taylor:
Anyway, we'll have some operations costs, right?
Vinney Chopra:
Yes, yes.
Kim Lisa Taylor:
You have to have people preparing meals coming in and changing.
Vinney Chopra:
Totally, totally, totally.
Kim Lisa Taylor:
You've got a little more maintenance costs and operation costs in there.
Vinney Chopra:
Yes.
Kim Lisa Taylor:
So it's totally offset by the cost that people are paying, but it's a better experience for those seniors also because they aren't in an institution where they feel like they're in a hospital bed, just in a warehouse. They're in an actual home and maybe the home has a nice view or a beautiful lawn or the amenities and niceties that they would want in their own home, and they have some camaraderie, so they're not isolated in just a room by themselves. They've got a common area where they can go and socialize and play cards and see each other, dine together, all these things.
Vinney Chopra:
And it's a silver tsunami. I know the session is not on that. I want to thank you publicly because Kim also helped me to write two chapters in my book, “Senior Living Investing Made Easy,” which is on Amazon. We have launched it, and then we'll be giving free copies — digital copy and audio copy — on April 27th also. And the end of the day, we'll be giving lots of bonuses, underwriting tools, lots of good stuff to our people who join us. Yes, yes.
Kim Lisa Taylor:
Great. Well, let's talk a little bit more about you and why we should all pay attention. I often tell my Mastermind group — so we have weekly clients-only mastermind that we run, always run by one of our attorneys — and a lot of times I'll say, "We all need to think a little bit more like Vinney. What would Vinney do?" Right? Because my story that I tell about Vinney is you came to the U.S. with what, $20 in your pocket?
Vinney Chopra:
$7.
Kim Lisa Taylor:
And you have this immigrant spirit that is, "I'm coming to the United States, which is the land of opportunity, and I'm going to take advantage of those opportunities." And you forge ahead, and I've seen this not just in you, but in a lot of other immigrants that come here with that firm belief that this is, "I can do anything I need to here." Whereas the rest of us that are born here, we're all a little bit hesitant. It's like, “Oh, we heard that we could get sued,” or “We heard that we could get in trouble,” or “We heard that this or that.” And so we let all those limiting beliefs hold us back where a lot of immigrants, they don't have those limiting beliefs and they just forge ahead. They make multimillionaires of themselves, and the rest of us are kind of sitting on the sidelines holding ourselves artificially back because we don't have the barriers, either; we just think we do. And so I always try to impart “Think a little bit more like Vinney.”
Vinney Chopra:
You're so kind. You're so kind. Again, I'm not the person I am today overnight. I want to say that I did read a lot of books by Dale Carnegie and Wayne Dyer and Jim Rowan and Tony Robbins and all those people. Like many of us, the biggest thing is, if we are a little bit more positive, if we have the mind of abundance, it's hard to live the life of no fear. I say no fear, but you've got to really say what will go wrong in any situation, and I try to research a lot, but then I say, okay, who has done it right? Let me hold hands with that person. That's how I grew to where I am today and how I coach and all that. But the key thing is please get a coach, get a great attorney. Milton Colegrove. I'd like to shout out for him. He's been with me 16 years and you've been with me 16 years, so SEC attorney and real estate attorneys are the two most important attorneys. Litigation attorney too. I got sued four or five times.
Kim Lisa Taylor:
Okay. Hopefully you don't need the litigation attorney.
Vinney Chopra:
Yeah, you don't need them. Yes, yes.
Kim Lisa Taylor:
Unfortunately, we live in a world where if you do need a litigation attorney, you need to find the biggest and hottest one out there because they're the ones that are likely to get you out of the situation.
Vinney Chopra:
Totally, totally. And I was so thankful because I got — without paying much money at all, maybe $10,000 in one and whatever, $5,000 another one — it just saved me because it's good to know what's behind the door and to have good partners, it's very, very important. The biggest thing, again.
Kim Lisa Taylor:
Do you remember what it was like when you very first-ever started talking to investors and were you nervous about that? How'd you get past that?
Vinney Chopra:
Quite a bit. Quite a bit, quite a bit. Actually. I still can picture my … I just couldn't sleep when I was going to see the first investor for $50,000, I remember, 45 minutes away. Somebody recommended me to go see him, and I was sitting in the living room and I just took my old clunky Dell laptop, almost so old, and I had four slides on it, Kim. It said, "Multi-family and single-family comparison." … I said, "You could take away that and do only one 20 units or 50 units." That was one slide. The other thing was how leverage, the investors, if they put only $50,000 and I get a loan, they will not be on the loan. That's how I did it in my thinking, and that way their $50,000 is actually controlling four times that investment, the asset. A lot of us forget to say that, and then tax benefits.
Kim Lisa Taylor:
That's a really good thing. Yeah, that's a really good thing.
Vinney Chopra:
Oh, thank you.
Kim Lisa Taylor:
If you're putting up 25% of the money from the investors, but you're getting a loan for 75%, there is a goal of an asset that's appreciating at a hundred percent of its value with only 25% of the money invested.
Vinney Chopra:
Totally, totally. And then the paying down with the rents with the residents and how the cost segregations will help. So those things kind of come to my mind. Four slides only, but at the end of 20 minutes, he said, "Vinney, do you have a deal?" I said no. He says, "Are you going to move to Texas?" I said no. "Do you have a loan?" I said no. He says, "You are so honest, I appreciate that. I'll write you a check for $50,000."
Kim Lisa Taylor:
Wow.
Vinney Chopra:
He gave me commitment in 35 minutes or so, and can I say that? That investor actually raised and I kept in touch with him through due diligence and everything. As I was raising money, he increased it to $125,000, and ever since he's been in my deals and put in my maybe over $5 million, but then he invited his friends over for coffee at Starbucks. I remember I got $29 million money from his network.
Kim Lisa Taylor:
Wow.
Vinney Chopra:
Amazing. Amazing.
Kim Lisa Taylor:
So this is how one $50,000 investment, four slides, can become $29 million. Wow. That's an amazing story. But I heard something key in here that I want to point out to everybody. What did Vinney do? Vinney educated. He educated the investor. That's all you have to do.
Vinney Chopra:
That's all.
Kim Lisa Taylor:
You don't have to sell a thing. You don't have to sell. You just teach. And so if you get it in your head that you're not asking for something, you're not selling, you're not pitching, you're just teaching, you're teaching them how this process works and how it could be an opportunity for them, and then they invite themselves, right?
Vinney Chopra:
Yes.
Kim Lisa Taylor:
And then if they like what you're doing and you're honest and you're transparent and you communicate, they bring their friends.
Vinney Chopra:
Oh, totally. What you said is the golden rule. It's educating them about IRAs and self-directed IRAs — “how to take the Wall Street money into Main Street,” I call it — and then also teaching them how the cost segregation works, tax benefits. It's very big on their mind. The other part, of course, is who is managing? How are you managing it? Show them the cap rates, teach them more about cash on cash.
Kim Lisa Taylor:
You do this over time. You don't try to do it at once.
Vinney Chopra:
Yeah, not at all.
Kim Lisa Taylor:
Yeah, that's exactly what we're trying to impart during our Masterminds and to all of our clients. It's like, "Here's a little pitch deck that shows you how to explain what syndication is and does."
Vinney Chopra:
Yes.
Kim Lisa Taylor:
15 Slides. That's it. You can explain this in 15 minutes. You don't have a deal. You don't have anything. It's like, "This is what I'm doing, this is how it works. This is how you can benefit," and then let them elect to be in it themselves. It's really as simple as all of that.
Vinney Chopra:
Totally. And if I may say that we can make small things into big elephants, and it's all in the mindset. It's all in the mindset. So if you think that you are really going to get into multifamily or storage units or whatever, right? All those things, assisted living huge. By the way, 11,200 people are turning 65 every night now for the next four years. I just did a lot of research. I taught last night in my mastermind, inner circle, one and a half hours I taught, and we recorded it too, by the way. If anybody wants to get a recording, please let Kim know. I will give it, send it to you, the link.
And we talked about how in the next 30 years it's going to be amazing opportunities in senior living. It's going from 54 million, 55 million to almost 94 million in the next 30, 40 years. So it's a huge, where the baby boomers will flow, that's where the money is going to flow. It has happened over and over and over again. So we'll be changing our whole lifestyle of not in the workforce, they will be workforce with the millennials, which is what we have been going after.
Kim Lisa Taylor:
Yes. You're also creating a place for yourself and for your loved one, right?
Vinney Chopra:
Yes.
Kim Lisa Taylor:
Because a lot of us have aging parents that we're going to have to think about how are we going to be able to help them, and if we can go to an environment now where they can go because we're in control or owners in this project, it's not going to cost them maybe as much as everybody else because some of your benefits to help offset their costs.
Vinney Chopra:
Totally.
Kim Lisa Taylor:
These are things we all … it's inevitable. We're all going to need some care at some point and we need to think about what that's going to look like for us and for our loved ones. But back to syndication, so how many deals did it take before you felt you really understood syndication?
Vinney Chopra:
I would say maybe three or four. And you were amazing. You said, "Vinney, read the documents." I thought that was echoing in my mind. I said, "You know what? I do want to read the operating agreement. I do want to read the PPM," which is the risks and everything, rewards, so that when investors are asking, I even remember you said, "Vinney, take your first few investors through it. Let's do a Zoom." I did a Zoom and then we went over page by page by page because going over that helped me to understand even better. Then it was easy for us. I would say two, three deals, but one can learn. It's very simple. That's why I wrote that book, “Apartment Syndication Made Easy.” I just broke it into five plates like a juggler and keeping it simple helped me a lot. Then hiring you as my SEC attorney was the best thing. And Milton also, whatever Milton says, I sign. Because he has got my best interest at heart.
Kim Lisa Taylor:
That's right. And he knows what should be in your purchase agreement and what pitfalls could be there.
Vinney Chopra:
Totally.
Kim Lisa Taylor:
He knows how to help you through the loan documents and making sure you understand what you're agreeing to. And phone documents are the same. Different lenders have different provisions, and there could be something in there that you wouldn't be aware of or you wouldn't realize you're signing away this or that, unless your attorney is helping you, "Hey, Vinney, did you know that that's in there? Are you willing to agree to that?" and maybe you push back if you're not.
Vinney Chopra:
So true, so true. Even my loan brokers too, I remember I've had only four loan brokers in my whole lifetime, 16 years. The key thing I like about them is they then understand your story. They know what you have been doing and they do all the legwork in the background and then they say, "Vinney, these are the two, three options." So as a CEO, it's much better to just find what the solutions are and then decide on different terms and things like that.
Kim Lisa Taylor:
“Why is this better than the other?” And that's what your mortgage broker can help. And they'll listen to what you're looking for and they'll know. "Don't go to that lender because they'll know who to talk to." So what we've talked about, and certainly we're going to cover this more during our one-day event.
Vinney Chopra:
Big-time, yes.
Kim Lisa Taylor:
Who has to be on your team and you've got your partners at the management level, so you can do all the jobs that the manager of a syndicate has to do. You've got to raise capital, you've got to oversee property managers, you have to find properties, talk to brokers, put in offers, conduct due diligence. You have to coordinate and guarantee loans. You have to keep in contact with your investors, both before and after. You've got to raise capital, you've got to assemble your loan guarantee. Plus, now you have to work with your mortgage brokers to find the loans. Your real estate attorney is there to help you understand the loan documents, the purchase agreement, create the vendor's agreements, all of those things, and then get through the title in case there's any title.
You've got to have them for that. And then you have us, who are going to set up your corporate structure and make sure that your management team has the rights that it needs, but also making sure that the right people are in control of even the management because you're bringing people into management that are doing a more minimal role. Maybe they're not helping to guarantee the loan, or maybe they're not going to be bringing in investors, but they're helping analyze deals or they're going to go out on the ground and conduct due diligence. They're doing a role that deserves some management earnings, but maybe not some of the management authority to make the decisions. So we can help with those structures.
We're also going to help you set up your syndicates both from a control standpoint, so the management team does stay in control, but the management team also gets adequately compensated and not wait until the end of the deal until you sell it. Because if you wait to sell the property before you get compensated, you've misaligned your interests with investors. And also we're going to make sure that there's the best tax advantages for everybody in the deal, the investors and the management team.
Vinney Chopra:
And the managers. Totally. This is so amazing. I love it. I love what you just went through. Again, I think lots of beginners might get overwhelmed, so I always see that let's eat elephant piece by piece by piece. So first talking, getting the team and LLC formed, Wyoming or Delaware, whatever. Then the big thing is now let's start looking at deals and learn to underwrite quickly so that you can be good at it. Now when you find a good deal LOI, and then getting the SEC attorney so that they can also, after your due diligence, like 10 days — usually in 10 days due diligence, you could tell whether you want to go ahead or not. That's how I feel. — And once we have done good underwriting with assumptions, with conservative assumptions, then I have always — by the way, my record is perfect. I have bought 40 deals, Kim, and everything from LOI to closing, so 100%. So in other words, I never lost a deal in the last 16 years. Once I made up my mind, I'm just that kind of person, I gave hard money or this or that, I say, "I want to get landed in." Anyway, that's my mindset. And on the 10th day — I say that ,no matter what happens; if we have a repair balance, you have a repair account for that — but … I mean, I like at 5 p.m. be ready on the 10th day. Get started on it.
Kim Lisa Taylor:
Here's what we say. We say we have statistics to show that people who do three things before they hire us are 85% likely to close, and that is: they have a signed purchase agreement on the property, someone has physically been to the site, and you reviewed the financials. And if you've done those three things, added back everything in that the seller might not have had in there that you are going to have as an expense, then in making the assumptions, like you said, then you're able to know, is this a go or no-go project. Anything else you might find during your property introduction or release audit, those can become deal-negotiation points.
Vinney Chopra:
Sure, sure.
Kim Lisa Taylor:
They're not necessarily deal-killers, but any of those three things I said, you go to the site and you're like, "We don't want this property. It's in a really, really bad area of town." Or when we add back in all the costs that the seller didn't have, it does not work for us anymore. Or you just never get to a purchase and sale agreement because you can't agree on terms or somebody else comes in with a better offer after you and they take that offer. So those things can kill your deals. So get past the deal killers, get your attorneys working on the docs. You complete your due diligence and the legal docs at the same time, gives you the maximum time to raise the money.
Vinney Chopra:
I love that. I love that. And again, I do want to stress quite a bit that getting a deal, a lot of people say, "I want to get a deal, get a deal, get a deal." No, no, no, no. You've got to spin two plates. One is getting investors also and talking to them and building relationships and educating them like we just talked today through PowerPoint and all. The key thing is they should be flowing money in. You can even share some examples, some case studies of what you are looking for, why you are looking in that particular submarket or wherever, how many units you might be looking at. That's what, again, I teach in my academy also. But the big thing is, you've got to be spinning two plates: getting the deals/underwriting the deals, and having the investors ready to invest money.
Kim Lisa Taylor:
And that was exactly the topic of our mastermind yesterday, was what have you done recently to both find deals and find investors? And maybe it's not in your own deals. Maybe you're early on and you're just starting out. You should be looking for people you can partner with who have more experience with you, come in on their deals, leverage off their experience, get that management experience. Now it becomes your experience. Now you can start going on and doing your own deals after you partner with others for a little bit. And when you partner with people, you don't have to think of finding a partner for life. This isn't a marriage, right? This is a partner for the next deal. We're just dating.
Vinney Chopra:
Yes, yes.
Kim Lisa Taylor:
We're dating, maybe in a long-term relationship, but just on this one deal. And it doesn't have to be exclusive with just that person for that deal. So think about this on a deal-specific basis, not on a lifetime or forever basis, because you won't know until you actually work with someone how well the partnership is going to work. And you've got to make sure that you've got those right skillsets covered — somebody's good at one thing that the other person isn't good at, and together it's enough. So let's see. What about things we've seen that happen when people try to syndicate on their own without either getting coaching or guidance? Easy, easy, easy to make $100,000 mistakes with other people's money.
Vinney Chopra:
Totally.
Kim Lisa Taylor:
Or with your own money.
Vinney Chopra:
Own money, exactly. Yes.
Kim Lisa Taylor:
Spend too much money on the deal and you get too far into the due diligence before you decide you're not going to go forward and you don't get that money back. Or you wait for investors who say they're getting their money, getting their money, and they never come. There's so many mistakes that can cost you a lot, a lot of money, and it can cost your reputation because if you have to give money back, you need to be able to give it back without deduction. So it's your money at risk until you get to the closing table. So you've got to make sure that you can cover that, that you're not getting too far ahead of yourself.
I know when my husband and I were syndicating properties, you get so excited that you have an accepted LOI, you want to jump on a plane and you wouldn't have looked at the financials or you wouldn't have maybe had a PSA in place or you wouldn't have done the right level of stuff. And you're already hiring inspectors and you're having people go out there and then you realize, "Oh, we're not going to go forward." So at the end of the year, you've spent $100,000 on deals that didn't happen, but you could have contained that to 10 or 15 and been a lot better off if you'd just kind of known what to do before and what to do after you get to a certain point in the deal. And so that's the kind of thing that you and I both have experience with.
Vinney Chopra:
I totally agree with you, and I would love to say that I tell everybody that red flags, which are small red flags, they become bigger red flags as we get deeper and deeper and deeper into due diligence. And the green flags, which are big, they get smaller. So you've got to really do lots of good due diligence, financial due diligence, researching. The Internet has got everything on it. Now we could do even the overalls and looking at the property, the different maintenance and all those things. Even with the pictures, the crime reports are very important. So there's so much we could do about the neighborhood and you can even have, I always tell the listing broker, "Hey, I bet when you put your OM together, you got a Dropbox filled with pictures. You put only few pictures in the OM. Could you give me link?" Because he wants to sell that property. "Could you give me link to those 150 pictures?"
Kim Lisa Taylor:
Oh, that's an interesting thing. So you would never know to ask that. I would never have known to ask that.
Vinney Chopra:
No, I've been asking it. Actually, I bought a deal in Atlanta. My broker, he was there 45 minutes after my call. He says, "Vinney, I'm at the property. I'm taking pictures."
Kim Lisa Taylor:
Nice. Okay, so that's a broker for you.
Vinney Chopra:
Yeah, and it's real pictures because oh, you could even hire on Craigslist some photographers and they charge you $100 and they spend one hour just going around taking pictures and you could put them in touch with the broker. See, you don't even have to take a flight. So I always try to see who I know nearby, wherever I'm buying. If I don't have boots on the ground, find other people to do it. The key thing is you want to know financially underwriting very solidly and also the due diligence, physical due diligence, how the parking lots look, how all these … the boilers and everything and the roof and all that. So small hacks really save you a lot of money.
Kim Lisa Taylor:
Yeah, definitely. All right, so what do you think you see as common things that hold people back from achieving their real estate investing goals?
Vinney Chopra:
I would say not committed. I think that people look on social media or they go to real estate meetings. They get excited for a little bit of time. They say, "Yeah, someday I'm going to get into it." But you've got to be passionate if you are going to move that from a W-2 job. I left my W-2 job in 2015. I started my business in 2007. I got trained in 2006. So you've got to actually slow paddle and learn … you can't do it overnight. A lot of coaches say you could leave your job within six months. I don't think that at all, not possible at all. You've got to take that step, baby steps with 14 units like I did, or 50 units or 70. I know 70 is optimum. You can have a property manager and a maintenance person that the property pays for and all that.
And great opportunities are coming right now with the properties that have gone down in value about 20, 25%. There might be another 6, 7%, I read and hear they might go down. But then interest rates ,as soon as they cut them in maybe October or November — the Fed was going to do it in June, but they're not doing it. As we saw the fall in the stock market, today, the stock market is up. But the thing is, once that happens, the 0.2, 0.25, 0.25, and it's an election year too. I think it's going to go right back up in 2025, '26. So this is a great opportunity.
Kim Lisa Taylor:
I remember you specifically buying some properties in 2010, '11.
Vinney Chopra:
'08, '09.
Kim Lisa Taylor:
Right after the property values dropped and we were in the recession. And I remember you a few years later saying, "Oh my gosh, we just sold this property for three times or two times more than what we paid for it." And so the people that poise themselves now by creating an investor database of pre-vetted and ready, willing and able investors and the people that are making those relationships with those brokers are going to be positioned to be able to take advantage of those opportunities and they're going to be positioned very well.
We think that this is unique and that we're in a unique time, but I started doing it in 2008. Our business grew during that time and what we saw were the people that got in trouble were people — and it's exactly the same scenario right now, they all forgot or they weren't in the business then — they over-leveraged their properties so they couldn't withstand a drop in the value. And they have short-term maturity dates on their loans. So they got caught with two- to three-year maturity dates. So now they're caught two to three years into a deal with a depressed property value so that they can't refinance out of that property because the new lender is looking at it going, "Your value is decreased and we're going to give you a lower loan to value. So therefore if you want us to finance this loan, you got to bring in another million or $2 million."
So that's where we're seeing people getting caught up right now is that they need to go out and recapitalize their deals and need to raise new money. And what I'm telling investors — and maybe some of you disagree with me — but I'm telling investors in these deals, if you're asked to contribute to a capital call right now, you should do it. And here's why. Because if you're being asked to contribute another 10 or 15% of your original investment in order to get a deal through a refinance so that it can ride up the next wave, you should take advantage of that because the alternative is you get nothing.
The alternative is the refinance doesn't happen, the property goes back to the bank, you lose your entire investment. So would you invest another 10 or 15% more or even 20% more to preserve the $100,000 you already got in a deal, or would you just let the $100,000 go? You've got to make that decision. And it's often not a fault of the operator that this is happening. So if your operator has been communicating with you all along, telling you what's happening — COVID happened, eviction moratoriums, supply prices increased, labor shortages occurred, all these things that we all know happened that aren't their fault and then interest rates increased, property values dropped — those are all the things that are legitimate reasons that you might want to invest a little bit more just to keep the property going, let it get through this hump, get a refinance loan. Real estate values go up. They go up, they go down, they go up higher, they go down, they go up higher. We've got a report that shows for 100 years, that's what real estate values have done.
Vinney Chopra:
So true, so true. No, you're right on the money, Kim. It's so true. So true. I know the distributions have dried up in our case too, right? Investors, because you've got to keep that money on the sideline to do the rate locks or insurance or whatever needs there. I know Texas and Florida got hit badly with insurance rate hikes. A lot of people, nobody could have the crystal ball that it's going to happen that way. Interest rates, 21 times increasing interest rates by the Fed last year and the year before. I mean, that was, this year they said, "Okay, now it's April 5th I think." Right? So key thing is hopefully they'll do those cuts again this year, which will get us back. But it was the biggest bull also. And the bull doesn't last. I mean, it was huge from 2008 to almost 2019 or '20, let's say 2021, the bull was big, but the cycle is there, like you said. So let's believe in that because I've been through it. You have been through it. Lots of people have been through it. Yes, yes.
Kim Lisa Taylor:
That's right. All right, well, so let's talk about our goals for our event on April 27th. So any of you listening to this, I think you can see this is not going to be a boring lawyer event. It's pretty lively.
Vinney Chopra:
Yep.
Kim Lisa Taylor:
I'd like to think I'm a lively speaker.
Vinney Chopra:
You are. You are.
Kim Lisa Taylor:
Anyway, so we're going to share our knowledge collectively and individually. We've both got our areas of expertise, but what do you want people to walk away with after this one-day investment? What are your reasons for doing it, Vinney?
Vinney Chopra:
I would say definitely to move people who are on the edge to really say that “I want to be in commercial real estate” because if you're able to raise money — which syndication is, by the way. Syndication is pooling the money together legally to buy whatever products. It could be a franchise business, it could be real estate, it could be storage units or any kind of things or even manufacturing companies. I've been hearing golf courses. I just bought a marina in Wisconsin.
Kim Lisa Taylor:
Oh, wow.
Vinney Chopra:
The key thing ... Yeah, yeah, a marina. And we are looking at a golf course just coming back on the market. We are looking at it today. So it's going to be down the street 15 miles only. So we'll cover the whole lake and so on. Anyway. But the thing is, the idea is if on April 27th, we could get you to the next level just to say that, “I have money” — a lot of you have money — “but how can we get other people to benefit?” See, the servant attitude is huge. How can you educate the investors? And we'll provide you some tools at the end of 27th, almost $3,000 worth of tools for free. We are going to give it to you. And underwriting, my underwriting, there are lots of underwriting tools in this country, in the USA. I like the simplest ones and mine is very simple. I'm going to give it away also, like I mentioned.
And I buy $50, $60 million deals because I underwrite in that template and it does the projections for five years, 10 years. It does all the different things you need for the investor brochure, all those things. But the key thing is, my thinking is to talk and get people to look at creative financing and look at brokers who will be bringing deals to you and where to look for those deals, those kinds of things. So I want people to feel good that syndication is not bad. They need to really go, "I wouldn't be here where I am today if I didn't take that first step."
Kim Lisa Taylor:
And that's so true. And my goals for this are to give you the confidence that you understand the corporate structure and you understand your obligations under securities laws sufficiently that you're confident you're doing it correctly. You're not worried about, "Oh, can I talk to this person? Can I offer them an investment opportunity?" You know it, you know how to explain it and you know that you're doing it correctly so you have the confidence to go out and start talking to investors and educating them. And also, giving you the tools so that you can go out and educate your investors on how the process works so they can make the decision to invest with you. And I think you said something in the beginning. You said it took you about three deals before you really understood syndication. We've seen that over and over and over again with clients.
The first time, it's overwhelming. There's a whole lot going on. You don't really get it. If you've been in our pre-syndication program, then you're in a much better position to be able to get it. Or if you have a coach that's teaching you, you're in a much better position to not have that confusion in the beginning. But still it's a lot. We're generating 150 or more pages of legal documents that you've got to review. You're seeing them for the first time, but now the second deal, it's like, "Oh yeah, I read this before, now I know what I'm looking for. Now I know what questions to ask." By the third time, you've explained it to enough people that now you're kind of the educator, you're the teacher, you get it and you know you're doing it correctly. So I think I just want to educate. I want to make sure you guys know that you can do this. It does seem hard, but it's not.
Vinney Chopra:
It's not. Positivity, positivity. And Kim has got two books there. I mean, please, I mean, we would love for you to really get to that next step. That's what the goal is on April 27th, seven hours. We'll give you action-packed, answer your questions. I mean, give you as much as we can, all the hacks, what we have done, blunders, and how you could really improve. And that's the key thing, I think, it's taking that first step. I always say, oh, if you are already done two, three steps and you are into your fifth syndication, you could ask us questions and then we can give you more answers, how to really grow your businesses and all. Yes.
Kim Lisa Taylor:
That's right. Okay, so we do have some questions. So we want to get to those.
Vinney Chopra:
Please. Yeah, let's do it.
Kim Lisa Taylor:
Also. Hey Bill, are you still on the call with us? If you wouldn't mind … Bill, I'm going to invite you. I'm going to promote you for here for a minute. So Bill, he's Vinney's guy and he's working with us on marketing this event. And Bill, can you help us tell everybody how they can go about getting their discount for watching this podcast and then sign up for our program. I put Bill on the spot here. He didn't know he was going to be doing this.
Bill:
Here I am.
Vinney Chopra:
Thank you, Bill.
Kim Lisa Taylor:
So how would people go about, we've got a preview discount for them. How can they go about getting that discount?
Bill:
Well, good question. I believe Cassia has set that up.
Vinney Chopra:
There is a $200 off…
Bill:
Let me look. I know it's in my email.
Vinney Chopra:
I was going to just as you're finding it... Go ahead, Kim. Yeah?
Kim Lisa Taylor:
In the meantime, let's talk to Alan. And Alan's had his hand raised from the beginning. Alan, so nice to hear from you again … Here you are, Alan. Hey, Alan.
Vinney Chopra:
Hi Alan.
Kim Lisa Taylor:
Nice to see you. Are you there?
Vinney Chopra:
All right.
Kim Lisa Taylor:
There you are.
Vinney Chopra:
What's your question, Alan? Yeah.
Alan Pollack:
Oh no, I didn't have a question. Kim and I go back many, many, many years.
Kim Lisa Taylor:
Yes.
Alan Pollack:
Of course.
Kim Lisa Taylor:
Since SDCIA, right?
Alan Pollack:
Oh, yes. And CCIM. And also the second book, “Six Steps to Real Estate Success.” You got your copy. Just wanted to say, I really appreciate what you're putting out there and I plan on participating on the 27th. Thank you.
Vinney Chopra:
Oh, thank you. Thank you, Alan. Appreciate it. Love to have you. Yes, please.
Kim Lisa Taylor:
We also have a low cost — I keep talking about our masterminds — we have a low-cost opportunity for people to get into one of our pre-syndication agreements where you can get access to our Masterminds weekly with one of our attorneys. And then also we give you some benefits like an investor marketing plan template, an investor relations blueprint, a pitch deck template for talking to investors before you have deals and some things like that. So we do have those things available. Feel free to reach out to us, go to our website, SyndicationAttorneys.com, schedule an appointment if you want to talk to one of our staff about it. And then we actually are going to have a little show-special pricing on that.
Vinney Chopra:
I love it. Love it. Love it, Kim. I do want to say, as you were talking, I do teach, by the way. I coach Inner Circle Mastermind every Wednesday, 4 p.m. every Wednesday — 4 p.m. PST actually, and up to 5:30, one and a half hours. I've been doing it for seven years. And we record these mastermind sessions and you could just join for free for a few times. VinneysZoom.com, VinneysZoom.com, V-I-N-N-E-Y-S zoom.com if anybody wants to come. I'm out next week, but Dave Mulvaney from Jacksonville, who is my director of academy, he'll be doing the sessions, so when I'm on travel or he's on travel, but then we are doing lots of good things and we underwrite deals, we talk about things, and we talk about lots of things over there for one and a half hour every week. Just a little thing.
Kim Lisa Taylor:
Wow. That's great. Okay. And then let me see, so I've got a link to our event that’s being held on Eventbrite. I want to see if I can put that into the chat for everyone. Let's see here. Chat. It's not going for some reason. It's not letting me grab that link. Yeah. So Bill, I don't know if you've found anything about that preview link yet. I thought I had it before I started the call, so I apologize to you guys for not having it. All right. This link that I just put in the chat is for going to our Eventbrite page so that you can sign up for our event. Okay, well Alan, thanks a lot for coming and we look forward to seeing you on the 27th. The event is going to go for, we've got seven hours worth of content.
Vinney Chopra:
Seven hours. Yep.
Kim Lisa Taylor:
We're going to do a lot of Q&A at the end of each segment, so it's hard to get to Vinney and it's hard to get to me because we've got a lot going on. But we won't be that day and will give you ample opportunity to ask all your questions.
Vinney Chopra:
Yes. Really looking forward to it. And we hope that lots of people will join and please share this message to your teams of people and everybody so that they could get into syndication, into multifamily and all kinds of things, how to raise money and how to do it legally. That's the key. Bill?
Bill:
Yeah, so if you see that link that I just posted in.
Vinney Chopra:
Yes, yes.
Bill:
Oh, actually you won't be able to see it.
Kim Lisa Taylor:
Can you post it to the chat, though?
Vinney Chopra:
Oh yeah, right there. Right there. Eventbrite link? Yeah.
Kim Lisa Taylor:
Here, I've got it. I'll post it to everyone.
Bill:
Okay.
Kim Lisa Taylor:
There it goes. Okay, everyone has it now. So do use the second link that Bill posted.
Bill:
And then you're going to have to change this one, too. So when you get there, there's an early-bird coupon that's applied that won't get you the best discount. So remove that and then add in the coupon called preview, P-R-E-V-I-E-W. And then apply that and then it'll get you the best price.
Kim Lisa Taylor:
Perfect, perfect.
Vinney Chopra:
Beautiful. It's going to be nice. We'll give me $200 off, I think. Right? If I can say that. It's only $97, guys. I mean, we should spend that money on a lunch or dinner with the family. It's worth it. Well worth it. And we'll give you so much more at the end … everybody who stays through seven hours of really learning, then we'll give you the free gifts also. Yes, yes.
Kim Lisa Taylor:
Thank you so much, Bill. I appreciate you finding that.
Vinney Chopra:
Yes, thank you Bill. Thank you, brother.
Kim Lisa Taylor:
All right, we've got a couple more questions. So Emily asks, "Vinney, have you ever thought about doing senior living development, creating a community of 55-plus independent living, assisted living and memory care?"
Vinney Chopra:
Guess what? I've been developing — actually for the last five years, let's say. In Punta Gorda, I built it for 12 million, sold it for $17 million, $5 million gain. And it was only 45% occupied. I could have kept it longer. I gave 42% returns back to my investors. So I've been building these over seven acres of land, one stor$y, three courtyards with all these. There is a movie also, if you go on my YouTube channel … I have a whole channel list of all my recordings on senior living, but I'm very excited about Arizona right now, and into Utah. I'm looking into RALs also, which I did a one-and-a-half-hour session last night.
If anybody needs that one, I'll be coaching quite a bit because there's so much money. A lot of people are making $10,000 a month on one house, on just one residential assisted living facility. So, I'm into that. My book also where Kim wrote two chapters — I appreciate you so much — “Senior Living Investing Made Easy.” Please get it from Amazon. Audio is there and the paperback is there and everything. And thanks Kim, I really appreciate you.
Kim Lisa Taylor:
You're welcome, Vinney. All right, so somebody asks, "Great information. Will the recording be available for us to review later?" Well, we will be posting this as soon as we can on our YouTube channel and on our podcast. We'll give Vinney a copy of the recording also.
Vinney Chopra:
Yes. Then I'll send it out. Yes.
Kim Lisa Taylor:
So yes, just give us a couple of days to get that edited and get it up.
Vinney Chopra:
We'll be recording April 27, but we'll be only giving that to those who attend. Right? Yeah, yeah, yeah. So that you could go back and look at lots of things. It's going to be an action-packed seven hours, literally. I mean, we promise you we are putting a lot of things together. So it's going to be great.
Kim Lisa Taylor:
And then again, someone asked, "What happens if the capital calls keep coming due to market conditions? How do you determine if the fund is managed well?" Well, what really should be happening is that your operator, the sponsor of the deal that is running it now, should be giving you a new property package that explains just like when you invested in the first place, they should be explaining, "Here's where we're at right now. Here's what we still need to do. Here's where we are with the loan right now, how much time we have on this loan, what kind of loans are available to us." They should be giving you a property information package that tells you just as if you were making a new investment, because you really are making a new investment, you're adding to your original investment.
And you need to see where that money is being spent, how long it's going to get a return, and making sure that you agree with how it's being spent. Do you agree with what happened and why it's needed? And that you do feel like you're not just putting good money after bad.
How do you tell if you're putting good money after bad? If your operator is not communicating with you. Okay? If they're not telling you what's going on, that's a problem. And those would be the ones that I would be very concerned about giving more money to.
But if they've been communicating with you all along and telling you what's happening and they come out and they explain to you exactly what they're going to do with that money, I think that those are the ones that have really thought it through. And they're not going to keep coming back for call after call because they're going to have thought out, "This is exactly what we need to do to get this project to the finish line. Here's how much longer we plan to own it. Here's what we think we're going to be able to do with the project," just like they did from the beginning before all these other things happened that they couldn't predict.
Vinney Chopra:
Sure. Totally. No, thank you so much. That's so true. So true. And communication is the big thing. And making sure that the investor's money is protected. That's what general partners’ mission is to make sure that we do. But things happen on the way. Crystal ball, nobody knew what will be happening after COVID. It just threw a big curve. So no, thank you. It's almost towards the end, I just saw.
Kim Lisa Taylor:
I know.
Vinney Chopra:
It's been such a pleasure.
Kim Lisa Taylor:
It's so sad to say goodbye because we have such a good time talking. And Bill, thank you so much for participating.
Vinney Chopra:
Thank you. And we look forward to really seeing you guys on April 27th. Please go ahead and register. We are excited to present to you the big, big … a lot of information, huh? Yeah.
Kim Lisa Taylor:
And do sign up right away.
Vinney Chopra:
Yes.
Kim Lisa Taylor:
We want to do this program. We want you all to be there. We want to help as many of you as we can, and we look forward to seeing everybody on the call. Okay. Bye.
Vinney Chopra:
Thank you. Have a blessed day. Thank you. Bye-bye.