Rex Fisher's RENTAL PROPERTY EMPIRE How He Scaled to 350+ Units

proximity within the three spaces homework play is it multiplies the potential for impact within your limited amount of time on this Earth and you're going to buy a bad property you I mean it's you do enough of them I bought one I think it was like the third or fourth a two bed one bath it was a nightmare we had the first three tenants in there were horrible I mean just just vacancy damage and it was around the corner for my house I thought this is a slam dunk welcome back to the roots podcast today we have a very special guest which is Rex fiser Rex is a close friend and Mentor he's the owner of The Brokerage we're part of at properties of Central Indiana he is a very large real estate portfolio of residential homes some commercial real estate and a variety of other asset classes Max what are we what are we wondering about with Rex today yeah I think we want to just dive straight deep into the background and figure out how do you go from the sports uh in entertainment industry into being like the king of Fountain Square uh I I uh I appreciate the the the rounding up on uh Fountain Square uh it's great to be in that space it's hard to believe we've been there almost 20 years uh I started my professional career within sports and entertainment largely evaluating the pricing mix for pro sports teams and concert tours in the top 40 cities of the US looking at how those different entities could maximize their business and what the elements were that had the greatest determinance of not only their success in a show but the price elasticity of their offering and what was interesting to me what what really started to get my interest peak in real estate I was doing some work for the Bulls and I noticed that they had to win uh enough games to get into the playoffs compete for championships um and perform at a very very high level for business to be great and I couldn't figure out why the Cubs didn't have to like they could be out of the running in June and it didn't matter they were going to sell out merch was going to go well corporate sponsorship was going to be solid um what I realized as I started to peel back the layers was that if I put Wrigley Field where the United Center is the business falls off a cliff it was a lot more about Wrigleyville and the right elements within the proximity of that venue than it was about Wrigley Field which sounds sacriligious it's even it's hard for me to say but as I then took that to other markets like Fenway and and married him up and then the other the other venues such as the United Center like where the Oakland Athletics play it held true and so I started to look at the elements of Wrigleyville that make it so robust for an entertainment experience and then backed that out into how does that that impact the businesses how does that impact the value of that real estate it all came back to the right real estate mix owner to renter occupancy uh ratios um commercial and at a certain amount of density um the access to downtown the ease of getting in and out of the neighborhood it's tremendous um um public transit access and as I started to gain a critical mass of data for these tier one neighborhoods that house the venue I realized I could pull the venue out and it just kind of held true for neighborhoods and so then I backed that out into well what is it what's the consistent process is there a consistent process for cities that have have revitalized from the post World War II Urban flight and it turned out that there was um a very simp at a high level simple process of getting a critical mass of density around three different space utilizations over somewhere between a 35 year and 50e play um and what that was was the first thing you do at least you know for the majority of the time from now back to then the 50s was you go figure out a way to draw a critical mass of business into a a dense Urban core you get people during the best hours of their day working in close proximity and those people are and you largely do that by appealing through tax incentives or different sort of stimuli at a local and state level to to revitalize those erors and get that those people in you know those people are going to need restaurants they're going to need uh office supplies they're going to need dry cleaners they're you know all of these elements that start to build back a commercial core and you got to let that bake to critical mass we saw that start in Indianapolis in the mid 70s right once that had reached a certain level of critical mass we had the commercial support to then go into the next space which needs to be play all right so we said Sports Austin said music right we look at that we say okay we're going to be a sports Town we're g to go after the PanAm games we're going to you know establish the Pacers we're going to bring the Colts here we're going to start to level that that up at critical mass that drives a whole another level of commercial diversification right and business pull into Indianapolis right that also has to bake along with it that takes some time in Indianapolis that took another 15 years maybe uh could be argued more that then what we started to see by the early 2000s 2008 2009 that had hit this point where we had uh enough development enough commercial establishment enough attraction within the urban core to start to really ramp up residential production and so work so is that when you saw sorry to cut you off continue talking about um I do have a burning qu was is that when you saw the gentrification quote unquote or Redevelopment whatever word you want to call it happen in Indianapolis so the what I start to see is in this would have been about 05 0405 um I saw a city that had successfully accomplished the uh the the construction of you know the the first leg of the stool if you will in office and and like work yep work and and play right and we were kind of taking this next level up you were seeing a next level of office you were seeing a Next Level you know visit Indie was really hitting hard con that's when we were really starting to win conventions conferences um and you I mean that's when we went from the RCA Dome to Lucas Oil Stadium just a whole that's when we got uh Super Bowl time absolutely so that along with L say the airport is a huge huge benefit things like the cultural Trail massive pull to be able to then start kicking this inflection point where we could pull residential density because back before about what maybe 06 maybe even uh 0708 if you wanted to live downtown and you couldn't afford lockerby you were either in Riley Towers or you were on the canal that was it otherwise you were in broader or not here mtown was a crater exactly it was growing up it was a crater my teenage even during college yeah so I looked at that and said with where this is residential is the next inflection point I need to find a Wrigleyville I can afford and it ripples out from there because you're we're really talking about centralized downtown yes Fountain Square being just off the edge of that one thing you said that caught my attention is the be able to work live and playh the do you have the numbers on how many people that are at switchboard uh the co-working space mhm sidebar before the week before I met you I had just watched the documentary on wework entire series and then I met Rex and he's like yeah I own this we converted this from an old church and it's all these Office Buildings I'm like this is we work completely um how many people at switchboard live right in Fountain Square and about 70% of our membership yeah so I see it yeah that you know it's interesting bringing up weor you look at you know there is a there are a lot of lessons within the wework model and I think there's a ton to glean from that uh both rise and fall MH um you see a number of models within co-working an office that take kind of that multi-site gym offering but the reality of The Power Within officing co-working is getting again that critical mass of people next to each other during the best hours of their day now you can introduce diversification in profession in story in especially now that people are you know doing more remote work yeah um and and so when we expanded to the second building we decided to do that in a concentrated area because you know I can go to any YMCA in the in Indiana but I go to the UR say why yeah 150 steps away the second building exactly well I think what's Most Fascinating about your story and experiences is you think at a very high level and you're thinking of like whole city economic and cultural development and the goal is to sell tickets for the Bulls in seeing that as a precursor to residential real estate um development and critical mass it's interesting as Max and I both got in kind of at the peak or the first peak of maybe many other peaks in terms of like residential being extremely hot now it obviously helped that interest rates were extremely low 3% and you know it was real estate was all the rage at the time but Indianapolis was kind of like hot in like nationally had a focus and that's when we started and it's almost all we ever knew in real estate whereas you were kind of watching in the shadows all this come up um I want to go back to your story though I know you used to live not downtown right and then you tried to make that move could you you know walk us through that transition in your life sure so so uh I originally when I we moved our company from Rose helman's incubator to the circle um I originally lived at Gardens and Canal Court right there because again it was Riley Towers or the canal right um and then you know after about a year and a half I uh I bought a home up in the northwest side you know uh on a city course was ex you know hey great I I think I paid 100 doing what everyone does 50k right get out the verbs and then as I started to get into real estate as as Fountain Square became you know the the R wrigglyville I was going to go engage in you know from a place of investment real estate um we just started I started spending more time there and there were two elements that that really struck me one you had a neighborhood here that had a very relationally oriented culture right it front porch culture people knew each other um the businesses that launched got community support by the neighbors um you had you know people would say hi introduce themselves engage I found that tremendously powerful I think it was is also driven largely by necessity because as that neighborhood vacated coming out is you know it was the Entertainment District the Theater District of the 1920s and 30s that started in the 50s to see a downslide vacate out and in 60s 70s 80s 90s to get by right you had to come together you had to know each other you had to be willing that you know engage it largely became a you know multi-generational um you know neighborhood with a high concentration of poverty but the cultural thread there the element was very appealing um because nobody had a qualm about walking up introducing themselves and and uh and engaging the other reality that we saw was there were a lot of kids out um didn't matter if it was 10:00 in the morning 11: at night um and their their families weren't ABS they it wasn't that they didn't care you had a lot of single moms you had a lot of young parents you had a lot of people going through hard stuff who were just trying to get by working two jobs um trying to put together anything that they could and you know we felt at that point that one of the ways that we could could make an impact was to move down and and establish a life in Fountain Square and have an impact now we did that very idealistically um and very ignorantly um and we spun our wheels for a few years really trying to help our our neighbors we just did not understand how um people with a different background and story uh than ours uh were were motivated and engaged um you know in their kind of daytoday perspective and Matrix through which they live their lives and so at the end of three years of you know looking of living in Fountain Square and looking at kind of three years of failure from that lens we my wife and I just did a postmortem and and said okay this is either an experiment that we learned a lot but you know failed at or this is a a phase two where we need to make some significant changes and at that point what we decided we came to a determination that we did not again we were ignorant we did not understand how we could have a sustainable Community impact in our neighborhood and we had a proximity issue I was still traveling around the US you know half the month my wife was still working in Caramel um you know every every day Monday through Friday and so we made a determination to tighten up the radius of Our Lives to uh you know five mile radius of our home and go look for a career opportunity with organizations who had a sustained impact within our neighborhood I ended up over at sheer Community Center running their fundraising Department an organization that serves the near e side uh and has now for I believe 30 years and Gabby ended up over at uh the Oaks Academy at the Brookside campus as they were uh getting launched and it was tremendously impactful and what we did what we learned was not only how do we have an impact in our community to those who need a hand up the most we learned how does a donor a volunteer a a a program member how does that ecosystem come together and meet the needs and you know hope that everybody's stepping into there um we we learned a lot about um sustainable Community Development and how to take um how to how to introduce enough margin to sustainably do worthwhile things and I think that was a a big Miss before was we just didn't think enough about the margin necessary to endure one thing that I I heard you say there is failing well and that's something that you speak on often is let's go jump in we're going to live here we're going to live in Fountain Square either this is going to be a great experiment we're going to learn a lot or it was just a good experiment and that's what it was there's lessons to be learned pack up move and and figure something else out instead it seems like you double down into that relational Equity like let's go live in this 5 m Square mhm let's figure out how we can improve and better people people's lives and make that difference and that's cool to see on the on the back end of it well you only had one L of the stool you were doing living but you weren't working yeah right and you possibly weren't playing I don't know yeah which is ironic but makes sense I feel like you asked about like hey back up to where you didn't move or where you didn't live in Fountain Square but you lived in Indie trying to add me trying to tell me I need to move or do I need to go play where I live it helps I will tell you what we learned within the tightening up of proximity and I that's been an iterative process from that point on was proximity within the three spaces live work play right play Work play home yeah home work play is it multiplies the potential for impact within your limited amount of time on this Earth so kind of a segue here youve talking a lot about Community impact MH um and and economic development in some ways um would you say you invest in real estate primarily as a means to um make an impact there or is it more for personal financial reasons it that's a great question as well I'd say I invest in real estate as a way to Steward resources that are ultimately unto my purpose so I have there are three concentric circles that I use as a lens of if I take on something or don't um and and as the more those circles come together the more I know I'm operating within my wheelhouse if those aren't touching I'm probably not doing it and that's uh coach connect and create so as those I'm looking for the opportunities that Empower my ability to do more of that right with the time that I have right in in within the the relationships that I have and those that I'll make so the way that investment real estate for me plays into that is you know investment real estate for me it's a long game it it takes a strategy but it's it's a fairly simple game to play right you kind of know the spreadsheet yes there can be curve balls you got to plan for those you got to you know do your due diligence you put your strategy together and then you execute the strategy right and it isn't that things don't go you know sideways you know but you need to factor that in and play the averages if you do that and play the long game you start seeing this Rising tide of equity and and cash production that can be that's a resource that can be utilized to go compound time again and you and I we we've talked about this capacity equation which for me is one of the most impactful PL points of accountability um you know it the equation is pretty simple it's your financial capacity multiplied by your capacity of time multiplied by your capacity of relationship equals your emotional margin to take on any challenge problem or opportunity that you have in front of you and so right you look at that and say anytime I am out of any of those three right if I am out of cash I am not thinking about anything other than how do I solve this problem right if I am overcommitted on time I'm just going to the next meeting into the next problem I'm reacting I am not present and if I have fractured relationship especially with those who are closest to me my natural Advocates those that are with me in the things that are worthy uh of pursuit um then I got to go step towards that repair those relationships and and move through before I can regain that presence once we have that laid out we you know we look at okay making money is you know that is likely out of the three the easiest that can be done we can't make any more time we get what we get right and the relational capacity the relational wealth is the most powerful it's ours to build right so then if all that is true we should use our cash to invest in the things that can be moved out of our time bucket right so that we can be freed up to build the relational wealth in the ways that you know that that align with what we are here to do right and if we build that relational wealth if this if this is what I believe it is we invest our money to free up our time to go build the relational wealth within our community then the equation takes care of itself and The Tide Rises right but if I get wiped out tomorrow it's not going to my ability to make money that's going to make everything okay it's my people that are going to come running right and we'll take step forward and and move from there um so investment real estate or anything I do in the financial Arena and facet of my life is largely done from the lens of will this help grow a pot of of assets that give me greater ability to multiply my time within the reality of the relational wealth I'm here to build so that I can have a critical mass of emotional capacity to move well do that makesense sense it does but it might not help someone who's like starting with their first property so I want to hear a little bit about the journey from working at Shephard uh which is a non for-profit uh committed to ending the cycle of property downtown that has nothing to do with um owning investment real estate into investment real estate uh during this kind of upand coming period of Indianapolis when it was transitioning from a crater hole to a booming Metropolis you were kind of there well prior prior to uh working at Shephard had you went to the investment Lane for residential real estate Abol had already started yeah already started i' had been in that for five six years at that point okay okay mhm and then you so then when does does Fountain Square start to take off as you plant roots even deeper you start you step into the the shepherd position wife steps into planning with the school Y and you just start to get this like rooted feeling but we get a lot and and the majority of people that watch this probably live in California would be my guess and are looking at Indianapolis because they're like oh familiar names in Indianapolis I want to know how to invest in real estate right and the answer to them are going to be when you dig deep and you plant here that's when things start to Blossom I I think so that is something so we've got investors that work with us right and and and they invest to their goals yeah um I have Investments that are not local right mhm what I look for there is who are those that I can engage who I can trust at a very high level who are relationally connected within my sphere right who have a track record of going and and getting it done and that you know as we look at investment real estate and again as a you know a a a financial asset that can be used within you know to the highest and best of Our Lives you look for the places where you can engage those who can who can back up what they say there's a lot of people out there selling false hope right so I I make the best clients right yeah right I mean not me selling FAL garnering the people who were sold false making it right and showing them the relational Equity being able to take the energy that I have and pour into the marketplace they have other energy that's in a you know Market without opportunity being California or somewhere that's overpriced that's oversaturated and they need to be able to move into sure our Skyline to help paint it and to to speak to hey when someone's first starting out right and they're buying their first um you know I think it just it takes an honest assessment of the margin in each of those buckets yeah you only have so much money to buy so much time right to go develop so much you know relational engagement but someone is using their money to get to know you guys to go help you know build up this you know the capacity of financial wealth into this rock so whether they have 10 bucks or 10 million I think one thing that's critically important and I wish I had more of when I was getting started out was someone sitting in the seat as an adviser to say let me show you how yeah we can take what you have and start the machine right so for me something I did for way too long was everything I went and found the home I went and you know and fixed it up arranged the financing um was you know got it out there on the market got it leased up handled the phone calls you you know 2 a.m. and the furnace is out or the toilet's clogged or I'm locked out or whatever that is right um and you can do that in your first you know one two if you're on the ground and you're there great but once you start to build a portfolio right once you even get five six properties in let me tell you winter hits right furnaces start going out one's a pain two hurts yeah three gets your attention of I don't want to do this anymore right I have a HVAC Tech ad a rental property right now I believe it actually right and so how long or my question here is I didn't do everything from the start and sometimes I'm like maybe I missed out on some really valuable learning of going and putting the carpet in of leasing it out I've had someone help me at lease from the very start to focus on growing the business which has helped me get to 12 units in three years at age 29 I couldn't have done that if I was hammering an ale all day long but would you say those early years did give you a lot or do you wish you would have outsourced earlier there's value to the experience I think my path was inefficient um I will say likely by um well I can't say just dumb luck I did not get into the craze of daisy chain and adjustable rate mortgages and scaling up and you know and so I was in a pretty good position when 0809 came around to go buy a number of short sales and foreclosures and tax properties that were I mean are still great today but because I was still at that time doing everything I missed out on I probably could have done 10 times what I did during that time because I was still doing it all myself um I should have learned for a year or two and then really focused where I was good but I did not have anybody in that realm who is saying Rex what are you doing you know it was kind of you know like this is just what you do right and remember this is not back in the day I found a book on investment real estate redit but there weren't podcast out there you didn't have people yeah absolutely your first uh investment property if I recall um you actually called up your parents and were like what is name a you interest rate that would you know make you you exatic could you talk a little bit about that and you know buying that first one and that experience yeah so there was a a good opportunity $25,000 house um you know four bed two bath uh that was you know came up on the market and I knew it was a great property I mean it was just I mean which is silly to say four bed two bath house for $25,000 sounds ridiculous today right but this is over 15 years ago um 20 years ago yeah yeah right and and so I knew you know one this is such a low price I probably can't get a standard loan on it right what am I going to do about that yeah um and two I knew it was gonna go quick yeah so I just you know I started and I I think this is something that we often feel like we can't do I think we forget that the people who are Advocates our loved ones or people who have been with us they want to help they want to come alongside Us in worthy things so I I called up my parents and said what would be an interest rate that would make you excited to loan me you know $25,000 to to buy this property and and they were like 7% and you're like and when do we get it back and I needed two years okay fine right and and that was it I bought it and it was leased out at 1,200 bucks a month from then on and we still have it today um uh I paid my parents back in two years 18 months um at that point I had kind of scaled the model I just started telling people what we had done right and at that point O and I'm full bore and there were a lot of of people who were pulling money out of the market cu the market was was I mean I remember Sirius XM uh well yeah got down to like 11 cents a share right then and um I bought a chunk of it because I was like I don't think the us if we're if we're bailing out Banks I don't think we're going to allow dead radios and cars for you know runs but uh that that was lucky um I you know at that point you know they he said yeah uh we'd like to get 10% too because like it starts out you loan to your parents they start talking you're talking it builds and I think it's really important to tell the story I think people get excited when there's a win right and and I I think we consider that to be bragging I think people need to know what works what's succeeding where the opportunity is there were a lot of people who were in their 50s 60s and 70s back then who were excited to loan money to me because they could get a secured position right on a a cash flowing asset it just it just made made sense and there wasn't anywhere they felt safe going to do that uh you didn't have near the private Equity deals that you have today so it was uh how does it look different now with private money I know a lot of our listeners will be fascinated by the way you've financed and built your portfolio I what's the number of units you guys are at of this we have we hold uh personally about 350 something units I don't um I should have an exact count it's a spreadsheet yeah you didn't buy all those with your ww job did no um that's where a lot of our clients and friends are stuck is like great I bought one I bought two I don't have any more money it's all dried up yep so how are you how is how did you build the machine I think a lot of people will be very interested in that right um it was iterative you know what I what I started out doing you know isn't what I did five years later y isn't what I did five years after that so you know I realized pretty quickly you know as I was building is like there's only so many loans banks are going to give you know 29y old guy right um and so I I started to realiz I was going to have to scale this private money end and you know I started out with I I need to tell the story so that by the time the the banks you know are are kind of tapped out with me right because I hadn't built a portfolio that was large enough to you know to really uh give B remember this was Al also a different time right Banks were not right really excited about you know doing a blanket mortgage on you know six to eight $75,000 properties um so you know what I started doing back then was I just started telling the story to everybody I could I mean I just knew when people would say hey how are you or what's going on oh fine oh nothing and no I said hey here's what I'm doing right I just bought my my latest property you know we financed it this way it's now renting out for this I'm looking for a next property and and this and there's some great opportunity that I've been able to press into I'm excited for you know for the next steps on the next ones that we're targeting and you have those conversations enough you know people start getting curious and and start wondering what could that look like for them what it oh really you borrowed money from you know your your parents college roommate to go buy that property huh how'd you do that deal oh he did a you know promisory note and secured it with a mortgage and gave him you know 10% on the loan and 2year you know note and we'll be able to refy it out you know here's what that looked like oh could I do that you know yeah absolutely you know and then all of a sudden oh could my parents do that yeah sure you know right and just it just kind of Bu you're putting yourself in the category of IAS for people their money absolutely um and and you have to do that you know that pretty quickly transitioned into self-directed retirement accounts um it moved from I I have this money that I had in the stock market and I'm nervous about what's happening there so it's sitting on the sidelines to hey I think I'd like to direct the you know funds towards us from a retirement account right that isn't really like it has been taking a beating and then you know scale really started to ramp up you know from there because those were already funds people couldn't touch that had gotten crushed in you know the 08 n 10 and um people were scared right I had you know people saying I I don't have a decade to make back what I've lost you know we need to we need to do something different so I think paying attention to you know what is the market that needs the value I can provide was was really important and that looks different today you've had a significant growth in private Equity Funds where you know if someone's willing to tie up funds for three to six years they can get a pretty significant return on that on that money um I mean one of the things that we really had to wrestle with back in 11 12 13 was commercial lending on real estate largely went away under like5 million right in in Central Indiana we had over a million vacant uh square feet of office space in the mil Square in 2011 it was a problem like it it actually threatened that lift we were talking about at the start of the podcast and so the the challenge with that was we had to figure out how to finance those past those two-year terms if that didn't come back you know fairly quickly and thankfully it it did and New Opportunities opened up and interest rates were really favorable and it worked but you know I think today starting with that relational capital and people people who want to help you get going want and and benefit with you right maybe that isn't you know uh a 10% interest rate you probably have to go higher that than that today but can you reposition the terms of that loan right so that you can achieve the goal maybe that's uh okay we got to do a higher interest rate but interest is going to acre to the principal I'm not going to do monthly quarter their annual payments we're going to let that build up as as principal that's going to be owed at the maturity of the note and yes this will be a two-year note but I have the opport the election to tack on an additional year at maybe an additional point or two of interest you know to continue past that and start to give that flexibility that if you see hey I'm not going to be able to hit my goal in this 24mth window that you have some relief and you aren't you aren't trapped in the goal uh or trapped in the in the return does it ever happen where you uh have some take someone's money and in two years I don't know maybe you had a furnace go out some vacancy and you don't have the money um that's probably people's because not everyone what I don't want people to hear from this podcast is okay go ask your parents and all your friends for money to go invest in Indianapolis feling California and how feel here I want you I want people to hear the opposite I want people to be less excited to buy real estate and more excited to bet on the horse and invest private money right I feel like that is the safe play to have control most of the people talking to us from California should be investing in Max or Rex who are investing it for them who live work in play here I I think do that well in my opinion yes as a as a point of diversification within your portfolio lending a portion of the liquid funds you have is definitely worth considering in this environment yeah right um I think also it depends on where you are in your life cycle right the risk I was willing to take in my 20s and the and and what I was willing to do as far as a non-cash producing asset very very different than someone who's in their 50s and 60s and is starting to look at I need to ensure a stability of cash production that I'm eventually going to be living on and putting into you know different facets in the home stretch of my time on this earth does that make sense so and then to um to your point on on the unforseen expense you have a Sewer Lateral collapse you have an AC unit go out you have you know a roof that needs redone cannot stress enough the importance of having a a budget is great but a personal cash flow plan is critical right how much cash do I have how much liquidity do I have how much access to Capital do I have right and what do I budget my expenses to be personally in this endeavor whatnot so that you know well before you have a problem where it could come right so if you look at at at that and you go oh we had we had a $10,000 expense we didn't anticipate that impacts our cash flow projection substantially we have a problem in 90 days you can do a lot about a problem 90 days out you can't do much about it cheaply effectively efficiently when it's in your lap and and so my encouragement to anybody is getting into real estate is you have to get disciplined about tracking your budgeted cash flow against your actuals that and that's really any business owner that's as much for realtors as it is you know people in in the investment real estate game um probably the biggest area of exposure I see in business in general is not accurately forecasting and tracking cash flow you know and and correctly evaluating the risk that that you have in front of you and if you see that 90 days out and you're you know that notes do you have three months to go pull in someone else who can take the position over you know you can get creative about out solving the problem if you need to sell the property you can go and sell the property but by and large you're going to creatively again tap that relational wealth to go bring someone else in because someone wants to play ball how often are you paying off your private investors with a refinance or a sale versus the cash flow oh all the time 100% um almost always with refi if we're selling an asset it's because we have someone who's interested and is willing to pay somewhat of a market premium or I have a deal that is good enough I'm willing to let this go fast so that I can go get that quick without you know it's it's like I don't have the time to go bring in the amount of capital necessary right with you know investor contacts and I have someone who's ready to go right so if I can go make a great a play over here by loosing a b play over here right I don't mind if I didn't sell it at Market premium I'll go do that all day long because the net is I just won does that make sense yeah absolutely it uh let's go by real estate that's what happens every time we talk like what are we doing on the sidelines it's hard right because we get emotionally attached to especially the well I don't want to bet on the I have I as well is a lot of people that I know have a hard time betting on the future value of the property to pay investors off that's a big block I think what a majority of people will hear as you talk through you know wisely budget for Capital expenditures so that it doesn't Crush you or know that it's ahead right know what's about to come so that you can and don't spend your cash flow that you make right and yeah and be able to continue to uh build up your own portfolio but a lot of people will take that and go um to analysis process of immediately yes and they'll be confined by the spreadsheet of oh the it doesn't work like you're saying how do I bet on the future appreciation CU it's in the future right but there's so many things in India right now that just point towards that go well you're also showing it's safer than you I mean all the Avenues like you could find someone else to take their position you could let worst case scenario sell the property and more than likely the value is going to go up and you can refinance but um I think that uh the other thing is you've shared that when you bring on an investor let's say it's a 2-year promissary note that helps you buy a a rental property or a buy renovate you know rehab refinance repeat whatever Burr uh you've told me the first two years you shouldn't even think of it as like your property it's it's like a bond maturing right like it's paying itself off I think is really wise and if most people had that perspective they would kind of get it like the investment will pay itself off off and produce wealth in five plus 10 plus years from now sure which is a hard perspective hard P swallow honestly CU people want to get that cash flow six months in be like cool I'm one step away from quitting my W2 job right reality is buddy you're not even close well and that's the challenge is that you know in real estate in the long game it's not a a it's not a straight line you have this you have inflection points where you're able to spread cost over critical mass of units where you're just learning and getting better at doing it where you are gaining the ability to see more of the playing field and move more pieces before they're right up on your door and once those things start to come together I mean I I had the first 10 years in investment real estate were incredibly inefficient they were slow I we built up a total of about 50 units right in the 10 years after that we added 300 it just that type of growth NE it just I've never seen it well you get better over time right projecting you get you come up on that one oh $15,000 sewer line goes bad you're not going to make that mistake again no well yeah you're going to have the cash for it or you're going to see the problem before it comes and that compounding effect I think really uh what you did wisely you said that it stopped you from scaling that you could have more MH I kind of disagree I feel like you had to be in the trenches to be able to build that up learned a ton to just fail and say yep I messed up I learned a lesson and here's what I'm not going to do again I'm GNA go right next time instead of left and be able to build it up um yeah and you're going to buy a bad property you I mean it's you do enough of I bought one I think it was like the third or fourth I I bought it in a c with a cash advance on a credit card because it was that I mean I think it was like $118,000 is a two bed one bath it was you know renovated it was a nightmare we had the first three tenants in there were horrible I mean just just vacancy damage and it was around the corner from my house I thought this is a slam dunk now and and I would have if I could have just gotten five six grand for that property at the lowest of the low about two years into that I probably would have done it just cuz I was so burned out on the property about seven years after that we ended up selling that property for $124,000 right dang it so I can't sell my duplex now that that's hard but playing that long game the way you play the long game well is you give yourself enough time with the different risk elements that are out there to stay ahead of them and you don't I it's so tempting to go distract yourself and not press into the critical elements of finding that person to take over that position reworking the financials to get them to work you know really drilling down and how you're going to bring that into your total strategy as a productive element for the long run is hard and um and when you haven't done it before it's unknown it's like staring out in the abyss but if you can buy yourself the time and do the hard work to pay attention to the right opportunities and the right risks and get ahead of them then real estate just does what it does which is candidly playing the long game up that's what it does time in the market not time in the market yeah I want to get your take on where Indianapolis is going um definitely before we end this podcast you've shared with me that you know Indianapolis has um has had the highest percentage of GDP growth in the last five years of any Midwest City beating out Chicago beating out Columbus it's got It's neck and neck with Columbus and population growth while all the immediate states around us seem to be kind of deteriorating Rust Belt City is we're kind of a shining uh City on a Hill in some ways um what do you see in indianapolis's future let's say in the next decade yep um from a from a real estate perspective what I see and we've seen this this ramping up for a while we've now hit you know this critical mass across those three spaces you know work play home that is allowing a tabl toop uh kind of resurgence or or second kick that if you just go look at the developers that are coming into Central Indiana who weren't here 5 years ago um you look at you know Hendrick's doing bottle works and now Circle Center Mall they don't they don't do that they don't do that if certain growth metrics don't exist for the local they they're making that plan because they're candidly looking to lose money for maybe 3 to 5 years but that level of investment I mean bottle work still has three or four more phases left on that development it's already a massive massive build look at the Investment Group out of New York that owns the stuts that you know and what they're doing there they have other buildings acquired there is a multi- uh phase plan to add residential and you you don't even you it is almost impossible to fully appreciate that level of investment from a group like that until you see what they've done in other cities and as you step back and look at how that investment is happening in just the Mile Square um you see something that has never been down in our lifetimes here uh which is and billions I billions of dollars going into you know the mil square of Indianapolis over the next five years the totals up I think this is still accurate more money getting invested over that amount of time than the past 35 years in the Miles Square collectively that's incredible you and then you look at the Strategic play at the state level right realizing Indianapolis makes up almost 50% of the GDP of the state using that to then help the development of the adjacent cities you're starting to see this second ring of lift not only in you know Lebanon and you know uh Whit down and whatnot but in areas like Anderson more Ville Green Castle um that's a big Shelbyville um Sheridan if you look at what the state is doing in the investment of the I65 Corridor to Lebanon the fact that that Eli Lily is investing 15 billion there is spectacular but look beyond that to the supportive investment of all the other companies that are looking to play ball there it's way more than that and it's a very exciting you know reality I mean if you're in Lebanon and you've lived there for a while you know I'm sure there's some tension about what's going to change but that whole area is seeing an incredible investment that runs up to Purdue that is doing their own I mean that Market West off that's why we launched The Brokerage up there last year that is a market extemely low inventory extremely competitive housing absolutely and and continues to chug on and value um and I I'm a pretty bullish guy on the our ability to attract Talent uh I mean from other major cities we're seeing that you know hands down but I am not hating the fact that that I65 quarter runs up to the third largest city in the US that sits in a state that is not in a great financial position we have a huge huge uh attractive value play uh to the Chicago Market that that we're benefiting from and as agents we're feeling that we see that for sure we see people mobilizing and and moving here it's just expensive to live Chicago and honestly we're a better local than we have been that was a big element of like back 10 years ago people didn't care how cheap it was to live here right they weren't coming they were like yeah we'll just continue to suffer and because it's better than Indie but not now what I want people to see is like we're on the we're kind of on the the the start of this uh you know curve that's going to be extremely high and we're at the very like the the lowest part of that curve y we're not even close to the height and I think a lot of people can't see that yet they don't see what Indie is becoming and they don't see the migration Trends I looked at the migration Trends we have more people than ever before coming from Chicago and California DC in the east coast sure and I'm talking to a lot of them Y and a lot of them right are you've mentioned this are renting because they don't know the city and they're waiting for rates to come down they're waiting for rates and rent rates I've never seen 000 units leasing I've never heard of that in Indie actually until two years ago now it's ubiquitous right my my buddy of mine asked me about um renting his home in zville on the village and I was like oh you'd probably get yeah at least 2,800 3,000 he comes back to me and said I got 3900 first day yep does not surprise me in z i mean there's not enough rental units no there aren't and there's also first time that we've seen people asking for multi-year leases at a premium product offer right so largely driven we we look at our data we've never seen more non 317 area code applicant for rental properties than we've seen over the last two years huge huge shift um and you a rental play Absolut why are people not buying these new builds that can Garner that in said they're buying these crappy 100K properties that the Indie Cas will play right no maybe maybe you should go into the luxury rental play 2016 buying a 60k property worked really well and renting it out now I'm I'm so much more bullish on the get something that comes with a warranty to help with those Capital expenditures and also by the way will Garner a better tenant on paper and in actuality you won't hear a a a peep from them for you know practically the whole lease versus your duplex you have the SWAT team L the door down what happened I don't know what happened in your duplex but yeah I what I do I pivoted straight to turn key where it's you're first I saying you learned and I've learned too yeah I'm selling off all my crappier ones yeah I learned quick when 19 homeless people were living in my place and I didn't know it right well and and this is something that this might be a helpful data point um it surprised me I I pulled this a couple months ago 10 years ago 2014 in all of Central Indiana there were 106 homes that sold for a million or more all right in 2021 that number had grown to about 360 something I can't remember that but that you know okay that's that's an interesting growth I'm going to pay attention to that over the course of eight years that has my attention the last 12 months we've closed over 700 that growth is not being paid attention to no and it is uh I I think often overlooked that that is is being driven by out ofate relocation uh a lot of retirees and a lot of people are coming here and can advance their career in a way where we used to be a pit stop if you were going to come so you're seeing people come in and buy not for yeah a couple years I'm not going to invest that heavily but invest in I plan on being here for 10 years um kind of a weird question but what would be the downfall of Indie if there was one if all this doesn't come true that's a I think it's relative to the other Urban markets so the you know what is the exposure of Indianapolis would be if we lose our economic strength relative to our affordability as as compared to the top let's say 20 markets in the US if if we don't continue to see the economic growth we do in health we're one of the most financially healthy states in the union okay and if or if some for some reason the inflation within Urban Central Indiana significantly outpaces not at percentage rate but actual dollar reality right comparable locals will be in trouble now I look at the money coming in here and you know once those ships have pushed off from dock on you know nine and 10 figure and 11 figure projects um you don't really turn those around so I'm I'm real bullish on the next decade because you you they're stuck you're committed now we're in this um I think the interesting uh thing I think about there Tyler is okay what happens or what's the risk as we head out of let's say the 2030s and into the 2040s are we going to hit that next level yeah of ele elevation right um and it's hard to look out past that right um typically where we see that struggle is an exis of business an unfavorable business climate kind of the same thing that brought it in right was right now you're seeing what I've heard and I'm curious if you agree with this is the engine of growth is the entrepreneurs and business owners and the companies like Lily um Etc that is who's been pumping up the growth the state government I have not heard people raving that they're doing a wonderful job they seem to be good at balancing their budgets which that's important for the ility y that helps to avoid you know you know a Chicago like climate but uh that engine of entreprene there would be no jobs without entrepreneurs taking the risk you know so would you agree with that or do you think the government is behind more of it than you than that I think the Indiana Economic Development Corporation has done a pretty darn good job uh of uh bringing uh awareness up uh at a at a global level to what Indie has to offer and what what Indiana has to offer I think visi Indie has done a spectacular job of pulling attention ear and ensuring a great experience I think uh the Indie chamber has done a good job of of attracting people and going out to learn from others who have done it in other cities um I also think that in partnership with the state the Central Indiana corporate partnership which if you don't haven't spent time checking them out go look at their board that is an organization full of Executives of the you know most influential businesses that are here looking to ensure right that this environment stays business favorable that we continue to be economically healthy and you know that that we're a place where business can be promoted and not restrained um because I mean they were set in motion to ensure that you know what revitalized you know the the core of our city um continues to to achieve its Mission you know and and that is good for the state I mean I if you looked at if we didn't do that when the manufacturing jobs were lost in you know terot Richmond Anderson and these other cities the pain of that reality is is incredible it's an unbelievable lift um that elongates that Redevelopment path and opportunity and makes it so much harder yeah I mean what we're what we're talking about is important I mean it affects the lives of families and individuals and um real estate's an integral part of that for sure anything else nothing that I have I have to uh watched us back like three or four times to process everything we have some end of the podcast we call them quickfire questions um if you're ready for it they don't have any quick answers but uh uh what's your favorite uh spot to grab a bite in Indie oh man um it's G to be really hard to nail uh down one I would say uh my my regular go-to would be chili water on Virginia I think uh orange IPA they brew great beer um I love their food and we have an end of uh every week we have a weekly wrap-up meeting where you know you know there it can be switch board members family you know you know staff other real can you know go uh just meet up Deb on the day it's kind of a nice way to wrap up the week um and and honestly they're just they're great over there we we love having them in the neighborhood what's one habit that has changed your life oh one habit that has changed my life um about four years ago I started working out with a trainer um and you know if you don't have you know a high level of Health um and there are multiple facets More Than Physical strength or whatnot but your ability to leverage that emotional capacity that's so critical is incredibly diminished um so that for me has uh really helped me be able to make the most of um what what I'm trying to do here and I never thought I would be able to work it in it's uh it's great I do it over FaceTime with my trainer at North Mass Boulder I just actually had a workout before coming here and um it's had a had an incredible impact any keys to success for for you know people that have struggled to build a habit there um yes in order to you got to just realize that you're not going to get in a behavioral cycle of of doing anything but you know for for this case and working out out of the gate you're not going to want to do it every single time right just realize I'm not GNA want to do this for the first three four weeks of doing it I still don't want to do it right and then if you're derailing maybe you don't have the cash to hire a trainer have a friend who legitimately you have to call at the they have to see you on FaceTime at the gym before you start your workout yeah that's a huge one I'm gonna start FaceTiming you you got get me the jail well the the saying that I think about oftentimes is you never want to start but you're always glad you finished oh yeah that has been true Almost 100% of the time for sure except when I'm like super sick and worked out oh my goodness my brain just went to how do you say that sentence but yet wake up every morning and like run 50 miles I don't get that well the first five minutes suck I I you know when I went out this morning I didn't really want to run but I knew H the byy mile to my legs will be warmed up I'll feel really good and I get a lot of endorphins I think most people do I would hope from working out so it truly for me is like a i will feel better the whole work day if I work out than just the stagnation it calcifies it just doesn't feel good for me well there you have it whenever you see Tyler running on the Monon he hates it it sucks and you will hate it and suck too but it'll make you better great I I will share one other thing that has been more I just sitting here thinking about this uh 15 years ago I started tracking one weekly goal that has had a huge impact and I don't expect every body to do this same as me but incredibly impactful and that is a bare minimum of 10 across the table meetings with with people every week in a stretch goal of 20 not going in to try to sell them on anything but knowing who they are where they're at what they're striving for sharing similar myself and then looking for the easy ways to help often that's an email introduction a text connection oh have you thought about this do you know you know here's a plumber that I know that might be able to help a 15 years of doing that intentionally and and holding myself accountable to being the proactive agent and connectivity in relationship has been incredibly powerful uh as you know the just time has rolled on and that's compounded probably almost immeasurable would be my guess for sure through the compounding effect well thanks for coming on great to be here thanks for having me love to have you on anytime I think that's it to wrap you guys got to like And subscribe and see who we have on next [Music] [Music]