395 | 2024 State of Construction and Renovation Costs In Real Estate Investing w/ William Burgstiner

Whether buying a new property or maintaining one you already own, construction costs are the ultimate wildcard for real estate investors, and they have taken us for a roller coaster ride the past few years!

But if you have data and insights into what the construction market looks like these days, you can plan for it.

That's why we're bringing back the man that oversees over $5M in construction spend PER MONTH at JWB, William Burgsteiner.

William will return to the show to talk about:

- where construction costs are today vs the past couple years
- how permit timelines are affecting investors' abilities to renovate homes
- what JWB is doing to give their investors an advantage by expanding their purchasing power and construction capabilities
- and more!

William was a fan favorite last time he joined the show so you won't want to miss this one.

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Transcript

Pablo Gonzalez: 1:17

Welcome everybody to this week's edition of the Not Your Average Investor Show. We are talking about the state of construction in 2024. We're talking about where prices are. We're talking about where permitting is. We're talking about, the ability to create impact through a vertically integrated company that takes construction real seriously. By bringing on some really, really great teammates and, we're joined by no other than what do they call you? Chief construction man. Is that what they call you? William? That guy, that guy. Uh, he is, uh, he is, uh, returning to the show today. He is, sneaky, funny. He has a. Name that could be everything from like a Heisman quarterback name to like an 80s bad guy name Like, you know, I could I could see like the gym teacher yelling His name big Willie style William Bricksteiner welcome to the show. Thank you. Appreciate it. Thanks for having me back Can't believe you let me back on I you know, I'm just glad you made it through the whole Nick Saban retirement thing I was really worried for you there for a little you know What as far as I'm concerned he can he could do whatever he chooses I agree. I agree. I agree with the idea of giving people free will and letting them exercise. good to have you back, man. We have our community in full effect already checking in here. do you remember how we, how we start the show normally? Do you remember the little tradition that we have? Uh,

William: 2:38

yeah, a lot of excitement, a lot of action, a lot of movement. Yeah.

Pablo Gonzalez: 2:42

What do you know what it's

William: 2:43

called?

Pablo Gonzalez: 2:44

I

William: 2:44

don't remember.

Pablo Gonzalez: 2:44

It's called the roll call, William. Let's go. We got the MVP. We got the Maven from the mountains of Colorado, Leslie Wilson. We got Christopher Lee from Fernandina Beach checking in. We got Mama Bear, Cody Adams in the studio with us per the usual. We got the ringmaster Drew Barnhill in the house. We got Pamela Myers, always a good vibe from the Seattle area. We got the legend, the man who has a hockey arena named after him, the number one referral source for JWB, Roger Voicena. Did you know that? He's got an arena, arena named after him. Very cool. No joke, son. We got Leo Faragunat. We got our regulars, Rosalyn and Gary Reilly from Marietta, California. We regard you, you're We got Reggie Fonse from the Inland Empire on the East Coast currently. Reggie, welcome. Welcome to the, uh, the humid coast. We got big, we got big Papa in the house. You know, big Papa is he's the co founder of the co founder.

William: 3:36

The co founder of

Pablo Gonzalez: 3:37

branch at J. Cohen. Yeah, we love, we love him when he calls in big Papa. Uh, good to have you. We've got the shaman of the natural investor show community. Nadeem Shaw from the West coast. Who else we got in here checking and we got the early bird a little late today, Dean for the early bird early bird.

William: 3:50

Yeah, but

Pablo Gonzalez: 3:51

you know, no big deal. Good to have you Dean. back in the house, Marty Quinn from golden Colorado and our growing Colorado community, Eric Kilo from Minnesota. We got a growing group of people. We're hitting all corners here. Yeah. Well, Minnesota just keeps popping up. It's like, I keep meeting people from Minnesota. I don't know what it means. It's, it's gotta mean something. We got, sir, Jeff Bolton, Bolton. Good to have you, Jeff. Jonathan Lubin from Jack's beach. the first families in the house. We've got the patriarch and matriarch Ken and Carolyn Malin. We salute you. All right, man, let's kick this off. Let's do it. first of all, First time that you were on the Not Your Average Investor Show. Did it change your life in any way?

William: 4:26

I mean, I thought I was going to get a lot more recognition. Like people around the office would recognize who I am. But, you know, I guess you spend that much time out in the field. It's life changing humility. Fair enough. I'm kind of wondering though, like at this point, this is my second, like, My second go around. What do I gotta do to get like some, not your average investor swag.

Pablo Gonzalez: 4:44

Mm,

William: 4:44

right. Mm. T-shirt. I see you got a sticker on the computer. Like we, we can get you a stick. What's the guy, what's the guy gotta do to get some swag up in here?

Pablo Gonzalez: 4:51

Man? I, I can, I can get you a look at this. Look at this. Oh. Live, live inch screen right now. Stickers. Are

William: 4:57

we just gonna, we're just making it rain. We got stickers, we got stickers. We got it. Rain baby.

Pablo Gonzalez: 5:01

Yeah. Yeah. Now you can use that. You're definitely not average William. I can tell you that right now. Sophia Tat is asking. Do you send recording out as I have to drop a 1245 for work? Oh, absolutely. Sophia. Right now we are live on YouTube. So you can always see it live on YouTube. next week we publish it, post edit it on YouTube. It also goes live on our podcast next week. So there is plenty of ways to watch this stuff. If you follow the JWB YouTube channel and, or look up the natural average of a show on. Whatever podcast you like. So happy to do that. Sophia, welcome to the show. Venus D Y K Dyke. I would say that is good to have you Venus. Anybody else checking in? All right, let's get this off, man. Seat of construction 2024. William, the 1st thing that I would like to just talk about is for those of us that didn't join us on the 1st time that you're here, highly, highly reviewed 1st time that you're here. Critically acclaimed. Can you just give us a kind of like an overview of the JWB construction department and what what it does and kind of like your role in it?

William: 5:58

Yeah, absolutely. So I would say JWB construction, we kind of have two buckets, if you will, right? You have Jim Marshall, our director of construction who oversees everything construction wise. But there's two buckets. You have a new construction renovations, right? So new construction. Basically, you know, we buy a piece of land, we determine what we're going to build on it, and we hand it over to one of our two builder partners. From there, we're managing the relationship with the builder managing the project itself not necessarily with the subs, but more so managing the relationship between our team and the superintendents of our builder partners, making sure that the projects stay on track. If any type of, you know, unforeseen circumstances additional approvals needed, what have you really making sure that from start to finish, we make it as smooth as possible. And then on the other side of that, we are at renovations department and really kind of 3 subcategories of that you have property turns, which is going to be the most volume that we're going to do. Renovation wise, we'll do about 1200 property turns this year. More or less. Somebody's been living in the house for a period of time. Could be, you know, a month, could be five years, who knows? I mean, I've seen, we've done property turns where some people have been living there for 10 years, right? That's going to be the most volume that we're going to do on an annual basis.

Pablo Gonzalez: 7:12

Volume as in amount of projects started and ended, right? Correct. Also spending money volume. Or,

William: 7:19

yeah, I mean, yeah, I would say definitely volume project wise, our average budgets around about 4100 dollars. And that's everything from. Hey, man, I walk up and I put a sign in the yard and a lock box and we're on our way. We don't have to do anything and that could be on the other end of the spectrum doing a full renovation just depending on how long somebody has been been living in there. So, but definitely on a project wise, Per project basis, the most we're going to do, we do renovations, both turnkey renovations for JWB as well as renovations for our clients that are, you know, looking for our expertise and our purchasing power to, to get a quality product. There got it just to, just to

Pablo Gonzalez: 7:55

clarify that that is. When you're saying that you're doing it for turnkey, it means renovating a home before selling it to an investor so that it's already an operating asset. That's the turnkey renovation. Yep. And then the other side of the renovation is if you have purchased a turnkey property through JWB. 10 years, 15 years, 20 years later it needs a new roof or needs something like that. You're able to handle that as well as folks that bring over property. Yeah,

William: 8:20

absolutely. More along the lines, renovation wise of more of a non JWB product. So somebody who's maybe owned the property for a period of time, they've been managing it themselves. Maybe they had another property manager. They've brought it to us for management. And it needs a renovation. But to your point, you know, house within. Usually a property turn or a maintenance work order. Yeah, we handle all the big stuff. If it needs a new roof, some of those capital expenditures. And then that last bucket, if you will, of renovations, we have our construction services department really think about that kind of as a an extension of our property management maintenance team to where, you know, resident calls in and we've got some type of issue in the home that's just outside of the realm of what somebody. You know, sitting in the office behind a desk answering the phone can be expected to manage, right? Whether it be that there's multiple trades and multiple vendors involved whether it be, Hey, you know, roofers are saying that it's a leak in the duct work and the AC guys are saying it's a roof leak. What is it? Right? So something that needs active project management needs the experience of the construction team to come in and kind of diagnose and pinpoint what the actual issue is there. Right. So really, like I said, the overall structure, you've got those two main buckets, so new construction, renovations,

Pablo Gonzalez: 9:36

construction, renovations, inside of renovation is the renovate before you give it to an investor side. there's an ongoing issue and it's going to require multiple trades. So now you need an actual construction manager, not just a property manager. Yep. To deal with it. And then there's also the most often one when you're managing 6, 000 properties. There's going to be a certain amount of turns every single year. And that varies in scope and dollar amount, but it is the thing that you do most in quantity as far as name of project. Right. And anybody that wants to kind of get like a deeper understanding on those different things and how Williams department deals with it. Go back to his original episode, Cody. I don't know if maybe you can look up his original episode. I should have had it handy. So that's my bad, but Cody will share it in the chat. If anybody wants to go back and see that. Cause I, now that we're like double tapping back into that, right. I remember you going into detail of, it was, it was right. When you said when you need more than one trade involved, what you do and just how valuable that is. Right. Because there is a, I know that the team here takes like great pride in how much. How much they save on maintenance based on phone calls that come in and being able to talk a resident through like, Oh, all you got to do is this instead of having a call in work orders. But the other side of that equation is. Hey, if it isn't just like a send this one guy out to fix it. And now there's been a couple, you know, at bats here and it hasn't fixed it. You need a adult in the room and the construction trades that well, and I'll say a

William: 11:03

huge, huge shout out to our maintenance department in the TMN presentation this morning our maintenance department gave a presentation and it was a staggering number. It was, it was either 750 or 775, 000. That they have saved by troubleshooting a maintenance item over that initial phone call with the resident. We don't have to open the work order. We don't have to send somebody out. So You know that that's a that's a that's an astonishing number.

Pablo Gonzalez: 11:32

It is a number I know that we've we've announced it every once in a while like when those numbers roll in greg Like brings it to the show and yeah the idea that you can save people Tens, potentially hundreds of thousands of dollars based on, Hey, this is something that we can resolve over the phone, crack that, bring that, you know, that is, that is value to everybody involved. But speaking of numbers, I think the, I think the number that we've thrown around here in the past, and maybe you can correct me, but it's essentially that JWB spends about 7 million a month in construction costs, something like that. Is that something you're familiar with?

William: 12:05

Not entirely, but I wouldn't be shocked. Okay. I wouldn't be shocked at all. Yeah. So that we're, we're anticipating on building close to 400 new houses this year outside of anything that we're doing, you know, renovations wise, property turn wise, just solely new construction, 400 new houses. Yeah.

Pablo Gonzalez: 12:21

And we're going to talk about the whole. Absolutely. Absolutely. Absolutely. construction side of it. And, you know, not so much. And we're, we're going to get into the details of like infill construction and what that represents. What I'm trying to do right now is just give everybody a breath of, we're reporting on some numbers because JWB has large purchasing power. It works with a big amount of the construction market here in Jacksonville, right. By number and by amount of money spent and like, you know, economic driving. You know, cutting out checks and whatnot. So you have really good insights into essentially the climate here and what's happening with cost and what's happening with permitting and stuff like that. So the first thing that I would love to talk about is you just mentioned that that average kind of like turn dollar amount per project is somewhere around 4, 000. Yeah, about 4, 100. Yeah, 4, 100. And I feel like that's the same number I was talking about four years ago when we started this show. Yeah. Have but that in juxtaposition to the idea that I keep hearing that construction costs have gone up and inflation is going crazy I mean, am I hearing that correctly? Has it been that steady for that long?

William: 13:30

Yeah Yeah, and I think really what that comes down to from a turn's perspective has to do with the amount of volume that we're doing Right the amount of volume that we're doing the relationships that we've built with our vendor base, you know, we talked last time I was on the show of And we don't really treat it as a vendor. If you will, we treat it as a partnership to where I'm looking out for you. You're looking out for me. We've got each other's best interest in mind. So, it comes down to the relationships there, the purchasing power. We explore a lot of different avenues to make sure that we have product availability Which is a big part part of that. We're not having to constantly search for new products if you will When I say new products, we're always looking for the the next big thing if you will that could make a difference for us but when I say new products i'm not necessarily always having to constantly switch a flooring product or constantly having to switch paint product yep, so that that definitely helps with the predictability and pricing of

Pablo Gonzalez: 14:28

it Okay, so before we jump too deep into that, because I think I can nerd out on all that that you said, what has what have construction prices in general done over the last the past couple of years? Do you have a sense of even though you're getting these, like, better terms, you know, better purchasing, better availability? Do you get a sense of what prices have done either year over year or in a past like certain amount of time?

William: 14:51

Yeah, I mean, as far as new construction goes, and we're still looking at a lot of like, surcharges on lumber packages and things of that number, things of that nature, I should say that, you know, who knows when, when that's going to change. But yeah, I mean, across the board, you, you've certainly seen increases, just some materials, doors, doors, Windows especially windows has been a big thing for us. It's harder to find windows It's harder to find a good price point on windows but yeah materials across the board just in general Year every year man. It's just the the nature of inflation What

Pablo Gonzalez: 15:24

about labor prices has has there been anything to this idea of there's a labor shortage, right? Like you keep hearing that there's labor shortages. You've heard a lot of smoke about kind of like these ordinance of um You You know, past around like immigration and stuff like that. Do you guys get a sense that there's less labor out there that you're fighting for?

William: 15:42

It really hasn't been too much of an issue for us, and I think it all comes back to the volume that we're doing, right? One of the, one of the biggest benefits, you know, with working with JWB is that We're always going to have that next property turn, right? We're always going to have that next renovation. So, you know, whereas we see prices go up when it comes to, you know, a pass through material costs, for the most part, the labor stayed the same because our vendors know that they can count on us to provide them with constant steady work. Yep.

Pablo Gonzalez: 16:09

And you're saying the advantage of working with JWB from the subcontractor contractor level and that is you provide steady work, you treat them as partners, you're not constantly beating them up like a lot of construction managers do that then translates to this idea of working with JWB as an investor in the sense that I get passed through this preferential treatment when I need something. There is, I have availability of materials and labor, you get this preferential pricing because you're able to buy in bulk and you're able to secure those contracts and you can negotiate that. So at the end of the day for, for an investor like myself, it leads to shorter timelines of disruption for our residents, which means longer residence day. And lower maintenance costs and renovation costs when I, as an investor, decide to upgrade the property. Yeah,

William: 16:59

absolutely. I mean, we're trying to always reduce maintenance as much as we can by using durable products you know, coming back to availability of products. You know, 1 thing that we always try to focus on when it comes to a property turn is, you know, not only making sure that we're spending money. In the right areas, it's just as important as to where we spend money as to where we don't spend money but also being really cognizant of the timelines there, you know, even though it's not a A dollar figure that we can necessarily put an actual dollar figure on You know, the longer that property sits vacant and it's not cash flowing from that investor. Yeah, that's that's real dollars Yeah, you know, so we've taken a lot of steps over the last couple of years to shorten that timeline Um Um, looking at our, you know, last four quarters, 12 months worth of performance, I mean, we're at about nine and a half days, you know, to get to get possession of a property, get it turned around, get it back on the market for you so we can get a renter in there. So nine and a half

Pablo Gonzalez: 17:52

days from resident leaves, whatever amount of scope needs to get done. is done. And now it's ready for showings. It's ready. It's moving ready, essentially, which at the end of the day, that completely shortens up the lifespan of a vacancy, right? Absolutely. That's huge, man. That's a nine and a half days. Given that the average residence stays like four and a half years, the idea that in nine and a half days, you can erase four and a half years of wear and tear seems pretty, uh, seems pretty incredible, man. That's cool. We have a good question here from Mike Foster. We are talking about this idea of longer residence days and You know what that takes. And he's asking, do you find that the cost of turnover renovations increased roughly proportionately to the amount of time residents have lived in a home?

William: 18:41

Not necessarily necessarily, not necessarily. You find a lot of times that somebody, if they've been living in the house for six, seven, eight years, they want to live there because it's a clean, safe, livable home and they've taken really good care of it. All right, so I wouldn't say those are necessarily correlated. Cool. Sounds good, man.

Pablo Gonzalez: 18:56

So just to kind of recap where we started us, like materials, prices and costs a couple of years ago, giant lumber shortage, right? You're saying that lumber is still. And a bit of a premium that's still kind of happening. You also reference other exterior, kind of like openings. It's kind of like what you're talking about, right? Like it's like windows and doors.

William: 19:17

Windows has been a big thing for us. I mean, you know, when, when we were kind of at the height of that shortage with COVID, I mean, it was taking us anywhere between 10 to 12 weeks to get windows in.

Pablo Gonzalez: 19:26

Is that nationwide or is that just like Florida because of like hurricane code and stuff?

William: 19:31

To be honest with you, I'm not really sure. Yeah, I mean, our timeline is shortened considerably since then. Yeah, but it's, you know, you're

Pablo Gonzalez: 19:37

still waiting a little

William: 19:38

while.

Pablo Gonzalez: 19:38

Cool. So the, so the, the extended timelines have come down, but they're still slightly elevated than like, yeah. Whatever the dream days were. Right. Exactly. Build, build, build. Yeah. Cool. Interesting. Yeah. Sir, Jeff Bolton Bolton says, for those with properties outside JWB, can JWB share the products they are using so we can benefit from the big data on how those materials hold up over time? When you think about this, like

William: 20:03

durability of materials, what comes to mind for you? Big one that comes to mind is paint. Yeah. You know, so we use Sherwin Williams paint. We've used a couple of different paint products over the years, but we use a Sherwin Williams satin finish paint. You know, the idea there is that satin finish, it makes it easy to clean. Right? So if I go in there and I do a property turn, that doesn't necessarily mean that I have to go in and, Paint the entire interior of the home, right? There are opportunities for us to go in and touch up walls Or maybe you know clean the walls because it has that cleanability factor with the satin finish. Okay so it's There's a lot of variables in it. It's not necessarily the individual product. Yeah, you know, it's not just sherwin williams paint It's that we're using a satin finish paint

Pablo Gonzalez: 20:48

satin finish I'm sure that your drywall guy is real good at like fixing blemishes or you can just kind of paint over it And it doesn't exactly that makes a big deal, right? Absolutely. What about I know that we've talked a lot about picking durable materials in the sense of like We want services that are easy to clean, simple to replace, and easy to maintain. Anything come to mind as far as like materials that you know that are that are built into that like is it?

William: 21:13

Yeah

Pablo Gonzalez: 21:14

Yeah,

William: 21:14

We're using a carpet product right now, which is pretty cool the way the carpet's manufactured you can actually dump a gallon of bleach on it and it's not going to change color

Pablo Gonzalez: 21:22

Okay,

William: 21:23

right. So there's a durability factor there if I can get through a couple of property turns You know being able to go in steam clean the carpets kind of revive them if you will I'm not going to be paying constantly to replace carpet You know, whether it's bedrooms, living areas, whatever it may be, if I can get two or three cycles out of it because of the durability factor there, that's a win. Interesting. Do you know what the name of that product is? It's an engineered florist product. I can't remember off the top of my head what the actual product itself is called.

Pablo Gonzalez: 21:51

Cool. Something to look for there, Jeff. Michael Santoris, William, can you explain how JWB came up with the reasoning on no dishwashers? I'm not sure if that's part of your

William: 22:01

That's a good question. I didn't know about this. And honestly, it comes down to maintenance. Yeah, right. it's 1 thing that we determined that if we can eliminate that it's going to eliminate potential maintenance down the road. If somebody shoved something down a garbage disposal or get something in a dishwasher Yeah. If your dishwasher breaks, you've got to replace the appliance. You've got plumbing involved. If you've got a leak, maybe you've got drywall involved. So, think of it kind of as, it's not just a dishwasher issue. If something comes up, it can be a compounded issue with several other things that also have to be repaired. when did that take effect? Is that something

Pablo Gonzalez: 22:40

that's been there for a while? As long

William: 22:41

as I can remember.

Pablo Gonzalez: 22:42

Okay. Interesting. I had no idea. Okay, cool. All right. So we talked about costs. We talk about materials. Another thing that got really heated was timelines and permitting and stuff like that. How is that doing these days in Jackson? Yeah,

William: 22:56

I mean, it depends on what type of permit you're trying to get. Yeah, right. If I'm going in and submitting a building permit that's got framing and engineering, you know, that could take anywhere between 6 to 8 weeks. And that's, you know, you got to get in touch with an engineer. You got to get those drawings back. You got to get them to the city, get them approved. You know, I think the days of just being able to walk in and slap something on the desk and get a stamp on it are probably gone there, but I will say, you know, the city's taken a lot of strides. You know, they've completely revamped the permitting website with the new Jack's epics website. Okay. Which is going really well. So, there's a lot of effort and there's a lot of focus on it, you know, down the city and who knows, maybe we'll see some, you know, Increases in timeline, so decreases. So

Pablo Gonzalez: 23:38

Citi is investing in technology, making it more user friendly. That's good to hear. Probably more clear clarity.

William: 23:46

It's a little more user friendly. Yeah.

Pablo Gonzalez: 23:48

Yeah. That's huge. What about you know, we talk a lot about supply and demand out here, right? So, I mean, inevitably. The city can invest in all the, all the great technology at the end of the day, if there are still people knocking on the doors to build houses, it's going to be a backlog for them, but it's good for investors. How do you get the sense of like construction activity permits being pulled things like that and that kind of

William: 24:11

backlog I'll tell you I mean, it's like you drive you drive through the city, you know, I said in our last I think I said in our last podcast that I was on it's like our office is the city of jacksonville, right? Yes, you're driving everywhere and the amount of construction that you see with jwb I mean Jacksonville's, you know jacksonville's the place to be I can't stress enough how much activity you see around in all of our neighborhoods. It's really

Pablo Gonzalez: 25:17

interesting to see it, right? Because I don't, I don't drive nearly as much. I just see the, I'm always looking for headlines and looking for interesting things. So we got, I don't know if you saw that we got rated the number two job market job market by the wall street journal. stuff like that to me is, is really, really telling. I think it's different in Jacksonville what you see happening because it's so spread out. Yeah, so there's so much space to fill into. So construction is still pretty horizontal. Whereas I'm used to kind of like when we were going through this type of boom in Miami, it was just like crank, crank, crank, crank, crank, crank, crank. Yeah, yeah, yeah. You don't see as many cranes, but you still just get this sense of. Infrastructure improvements are happening all over the place. You're driving past any kind of neighborhood. There's something, there's something being built when you're driving past that main street strip and like Atlantic Boulevard that I take to go home. It's always like, all right, they're just clear cut this area because a whole new development is coming everywhere, right? Yeah. Yeah. Interesting. And do you guys, does that present a, a different obstacle for you guys? Like, was it, have you had to adjust your timelines on what you think permitting is going to happen? These days versus kind of where you were a few years ago.

William: 26:25

No, it just kind of is what it is, right? You just got to kind of flex where you have to flex

Pablo Gonzalez: 26:30

How do you do you not need permit for a lot of these terms? Like is that like how do you do that in nine days?

William: 26:35

Yeah I mean most of the stuff we're doing on turns is more cosmetic More so than yeah I gotta go in and reframe half the house or something along those lines if i'm just going in You know, I'm pressure washing the house and cleaning. I'm painting. Maybe I'm putting some new flooring in all things that are not going to need a permit.

Pablo Gonzalez: 26:52

Yeah, that makes sense. That's probably an educated question by me. But, um, so, shaman Nadeem Shah says question at the time of a turn, why not do vinyl flooring instead of that carpet that you just mentioned? Isn't isn't. Doesn't vinyl flooring last longer than carpet?

William: 27:06

The answer is yes. The way that we approach is if we're doing a renovation, like a turnkey renovation. So a home that JWB has purchased renovated to our standard that we're going to sell to 1 of our investors. We're going to put that hard surface flooring in. The idea is yes, it's going to be more durable. There's going to be more longevity there, but. We're footing the bill for that, right? We're, we're, we're putting that in, whereas on a property turn, we're trying to be cognizant of your money. We, we understand that every dollar that we spend is affecting the return on the investment. So when I look at the price of carpet installed versus the price of the vinyl plank flooring, well, the carpet is about a third of the price, right? So realistically, if I install carpet, I could go through three property turns. Replacing the carpet every single time before I get to that break, even costs on the vinyl plank. So, if I go in there at a 3 year lease term, and then do my property turn, that's essentially 9 or 10 years that it's going to take for you to even break. Even. You get into that that price point for the final plank.

Pablo Gonzalez: 28:11

So, that sounds to me that it's. You've gotten real, you have your standard that you built for where, you know, because JWB is vertically integrated, you know, beyond just a regular turnkey company. You're doing all that stuff, giving somebody an operating asset, you foot that bill, you know, what you put into that at that point, when you're doing it, you do vinyl flooring. When someone has an existing property that is already performing and they either come to JWB for property management or, you know, whatever other scenario can be, and it's the investors. Time to make a decision you're able to present multiple options exactly and you found a carpet that is a really really good option Exactly those of us

William: 28:52

we're gonna we're gonna always leave that decision in your hands, right? We kind of look at it as hey, like what would we do if it was us was our standard? But we know that you know, that's not what makes the most sense for everybody So we give you both of those options

Pablo Gonzalez: 29:05

cool. That's awesome. I mean as as you were talking about this, The construction services, I don't know if you know this, but I've recently so I have the 3 properties that I purchased through and then in January, I bought a duplex that I moved it to 1 and I'm having property manage the other 1. I know that that duplex. Within the next five years is going to need a new roof, right? And it's going to need like AC and stuff like that. That's the type of stuff that y'all would be able to coordinate for me. Absolutely. As a property manager. Absolutely. What does that, what does that look like for me as am I hiring you kind of like with a standard GC fee or what's that look like?

William: 29:40

Yeah. So for our turnkey properties, some properties we've renovated, sold to our investors. There's no type of management fee involved for anything on occupied maintenance We do have a management fee on the property term. It's 10 percent which is capped. Up to a certain amount, for properties that are not ours, you know, you've brought that to us for property management services There is a management fee that's attached to that if we're doing a construction project or a construction services ticket where the construction team is getting involved

Pablo Gonzalez: 30:10

Got it. So management fee attached to that, but I still get to tap into the purchasing power Exactly in the in the tablet you're tapping into our network. I'm tapping into the network, right? Super super valuable Yeah I thought of that with the carpet thing because I know that we have more You know, me as a green building guy, like, I'm not a big fan of carpet, but we have a ton of carpet in those units, but I'm also cost sensitive. Right? So, we're

William: 30:32

strategic about what we're putting the carpet. Yeah. Right. Yeah. We may put carpet in bedrooms, but maybe we're not going to put it in the living room because it's a high traffic area. It's going to get a lot of foot traffic. We're not going to put it in a kitchen. Right? Yeah.

Pablo Gonzalez: 30:45

Yeah. Makes a lot of sense. Venus Dyke has a question. Venus, let me know if I'm pronouncing that correctly. what's the average rehab cost per square foot in Jacksonville right now? Do you have that number? I don't. You don't have that on top of your head. All right. I don't. Okay. Mike Foster, I was recently notified by my portfolio manager that one of my homes has flooring that has warped and come loose due to Florida humidity, loosening the glue. This is a home built in 2022. Wow. Is there a better flowing product available that can better withstand Florida humidity?

William: 31:15

Yes. And we've already made that change. We're in the process of making that change, moving from a glue down plank to a floating click lock product. Okay.

Pablo Gonzalez: 31:23

From glue down plank. So, meaning there's an adhesive and you put it on to floating click. I assume is like a puzzle

William: 31:28

piece. It's like a tongue and groove if you will. Okay. but yeah, I mean, he makes a really good point. I mean, humidity is a real thing in Florida. Yeah. you know, especially in a lot of older homes, you don't see it as much in a newer build, but it's obviously not out of the The realm of possibility, but to answer the question, yes, it's something that we have identified and we're making that shift to that different product.

Pablo Gonzalez: 31:49

Good answer.

William: 31:49

Good answer.

Pablo Gonzalez: 31:50

Mike. I hope you're happy with that. okay. So we've talked about. Timelines. We've talked about supply. We've talked about costs. let's talk staffing levels. Sure. as the JWB construction department from like a headcount have they grown year over year?

William: 32:03

Yeah, absolutely. We've recently brought on two new superintendents on our property turn team. Again, just purely based on the amount of volume that we're doing. We've also brought in a new superintendent for our construction services division. Again, just purely based on volume. Not to say that that means there's a lot of fires that have to be put out, but, you know, with 6, 000. Yeah, close to 6, 000 properties, there's always going to be something that's happening. You know, 1 of the really cool things that we did is we really. Kind of took each level, like, we took a property turn and we kind of took it apart and build it, built it back up and said, okay. How long does it take to complete each activity? And be successful in running a property turn, right? And we more or less built a staffing calculator out of that. So now, year over year, once we get our projections as to how many property turns we're going to do for the year, all we have to do is go in, change that number, and it's going to tell me exactly how many superintendents we need to continue to perform at that operational excellence level. Interesting,

Pablo Gonzalez: 33:09

interesting. As you're saying that, I'm thinking, okay, so The speed to turn isn't just a buying power thing. It's not just like a great, you know, relationship with your subcontractors. It's also kind of parallel to everything else I see here. It's really good planning, forecasting, making sure we're

William: 33:26

staffed appropriately.

Pablo Gonzalez: 33:27

Yeah. Yeah, absolutely. Wow. That's really, really interesting. So you guys broke down every piece of a typical turn and then timed it

William: 33:34

out. We, we broke it all the way down to how long does it take to peel the number off and slap it on the side?

Pablo Gonzalez: 33:40

Wow. Wow. Wow. Interesting. That's super cool. is that fun for you? But it's unnecessary. That's necessary. Yeah. Fun is being able to say we're done with this in nine days. Exactly. Exactly. That's, that's, that's the reward. I appreciate the honesty. Uh, speaking of things that JWB is really good at as far as planning and stuff like that, they're really good at innovating. Right. And we were talking about the site. This idea that y'all have now been around long enough. We're starting to really see the impacts of all the things that you're doing shine through. Do you want to, you were telling me like a really interesting story about when you kind of first started, you want to, you want to talk a little

William: 34:20

bit about that? I mean, you know, we we've got, you know, I don't know if we're going to get into the pictures or not, but we can. Is that, is this

Pablo Gonzalez: 34:25

time for

William: 34:25

the pictures? Sure. Why not? All right, go for it. You know, we've got kind of one of these core neighborhoods that we invest in the Oakwood Villas neighborhood. And I remember, but by 6 or 7 years ago, when I first came onto the team and I was working on our acquisitions department and my 1st or 2nd week, we got up there and said, oh, hey, we closed on, you know, it's like 170 lots this week. And I'm thinking myself. What have I gotten myself into? Well, where are we going with this? Right? And, uh, you go into this neighborhood, and a lot of the lots that we had purchased had, you know, old, older mobile homes on them that had just been run down, abandoned, were in total disarray. And they kind of looked at me and said, okay, here's your first project. Find out how we're going to get rid of all of these mobile homes. And, uh, we don't want to pay anything to do it. Right. So we had to get really creative there. Instead of paying four or 5, 000 a pop to get them demoed and hauled off. We kind of went out there and put ourselves out there and we actually found some scrappers that were interested in going and they would haul them off for free so they could tear them down and take them to the scrap yard and sell it for whatever it's worth, I guess. But you look at this neighborhood now and it kind of speaks for itself. It really does. Yeah, it kind of

Pablo Gonzalez: 35:39

speaks for itself. So going from that empty, you know, empty lots with old dilapidated structures on it to brand new homes and good things coming. Is this another one that was kind of like that? This dandy? Yeah, these are all in the same neighborhood. All in the same neighborhood. Right. So yeah, so this is, yeah. Talking about this idea of being able to take a underutilized asset, which was the land in Jacksonville have these like, you know, I know, I know, as somebody that's been in in neighborhoods that start to get restored or activated, or whatever, these empty lots are generally places where trash piles up, where, you know, you can do shady things. You know, like, like, I remember when I was living in Wynwood, and I before it started really getting super vertical in Miami, it went from a period of We had little homes and it was like a little neighborhood. it was a mixed neighborhood of kind of like socioeconomic demographics. I was kind of like on the first wave of like people moving into it. And that felt one way, but then there was a moment where it. A bunch of developers just started acquiring lots and tearing stuff down before they could consolidate everything and start building upwards. And it was during that time where it got the most dangerous because it was like, you're walking past really dark areas that don't have anything there and people were using it for whatever they want to use it, right? So, like, I would assume that in these neighborhoods that that JWB has gone in and cleared out old structures and, you know, That kind of just takes away the opportunity for trash to build up for people to plan stuff that isn't really above board and just makes it much more livable area. It's

William: 37:17

really I mean, for me, I'm a Jackson native. There's not a lot of us in the office that are Jackson natives, but for me, we talked about driving around these neighborhoods and it's really a, it's really a source of pride. Yeah. You know, to see neighborhoods being transformed really one house at a time, one lot at a time. Yeah, you know, for the city, you know, it's, it's, I call it the triple win, right? Yeah. Yeah. For the city. It's great for the city. We're going in. We're maybe tearing down a house that's been, you know, got all kinds of rolling fines and liens on it and, and building a new home to get a performing asset back on the tax roll for our investors. And it's a it's a great opportunity for them, you know, to tap into the Jackson market for the surrounding neighborhoods. Property values are going up. So it's it's really a win all the way around, but it's definitely a point of pride. I could see it being this.

Pablo Gonzalez: 38:05

Having come back from Lee's mentioning how it's just at this real estate investor event in California and it's. The more time I spent here, right, I've spent a lot of time in these walls, understanding what JWB does. And like, as time goes on, I'm starting to get to spend some time outside of these walls and understand what the difference is, right? Like understanding why, how spoiled we are. But I would imagine that the turnkey stuff that I was seeing over there felt like they were building subdivisions in certain places, like where they were building out whole new neighborhoods. And what I've realized is that it's truly unique that JWB has figured out. How to put new homes inside these infill lots and as I hear you talking about this triple win effect, I think of the idea that, you know, connecting these neighborhoods to each other to eliminate those blank spaces is a win that a another way of developing this thing wouldn't be doing it right. I would just be moving people from one place to another instead of instead of connecting them. For the city, not having to run all new services to another area versus start to get economies of scale within certain areas is another win for investors. Investing in things that are already there and already proven, right? Like, it's already a functioning neighborhood. So it has existing demand. You don't have to create new demand for for people to do this. You get to tap into the existing population. That feels like risk mitigation from the standpoint of not having to go clear, cut a whole bunch of trees to put in a multifamily development. That makes me feel good from an environmental standpoint. And it's no surprise to me that. That's kind of a thing that JWB first signed it on the first front page of the wall street journal for is like unlocking this idea of building info lots as a builder. Why is that? Why is that so much more difficult? Right? Like why hasn't everybody else just figured that out?

William: 40:02

It's, it's definitely its own beast, if you will. It's a lot of different challenges, space constraints. Neighbors aren't always super happy when you've got framers and reefers all around making noise at all hours of the day. You know, more construction crimes, if you will, right? You got a lot more activity in the neighborhood. You've got materials sitting out there. They could. Much easier, much easier for them to disappear, you know, but yeah, I would say the biggest things are the space constraints. Yeah, just getting, you don't have a lot of machinery in and out, staging, staging. I would say staging is a big thing. If I got, you know, a trust package that's being delivered and nowhere to put it, that's a problem. That's a problem.

Pablo Gonzalez: 40:40

Yeah. Yeah. When you think about, when you think about in, in the neighborhoods that we live in and like, you see these homes getting built all the way to the property line with a having to do that inside these neighborhoods that are already, you know, like there and functioning and like staging and getting that stuff done, dealing with noise complaints, dealing with all that other stuff. It's its own, it's its own beast, man. I think it's super, super impressive that you guys have unlocked it. so we went over the before and after pictures. We talked about this, like, value of InfoLots. We got a couple of questions here. Sure. Lee Bishop. He's the MVP. You may have heard of him. Lee asks. William, how close does your team work with the portfolio managers in getting the tip off of turns coming in a month? And does this go hand in hand with pre ordering basic materials for the turn?

William: 41:26

It's a good question. So we do have a calendar to where we can see a week out, two weeks out, kind of what possessions are on the calendar. So we have a pretty good idea as to what's coming. as far as our interaction with the portfolio managers, very, very close, right? We're, we're going out there. We're writing those scopes. We're sending them in. They're going directly to the portfolio managers, but we're also in contact with them to say, Hey I noticed this out here, right? Let's talk about this. Let's make sure that we're on the same page. So we understand what's going on. You know, same idea if we're recommending carpet or plank to say, Hey, look, here's some notes. I'm recommending this. You can also do this, making sure that we have all the options out on the table. They're coming to us with questions all the time. I mean, I can remember when I was doing property turns and you would field anywhere between 20 to 25 phone calls a day, just from the office having having communication about the scopes and kind of what's going on there.

Pablo Gonzalez: 42:24

So, 20 to 25 phone calls a day, just from the office meeting, you're getting 20 to 25 phone calls a day from our service from our portfolio manager. To keep the realist to keep the investor apprised of like what we're doing and what's going on.

William: 42:38

Absolutely. As far as ordering materials, I mean, that's kind of the beauty of what we, what we do scaling it. We're using the same materials in every house, the same flooring, the same carpet, the same plumbing fixtures, the same paint products. So, our vendors and our suppliers know that we are constantly doing projects. So, they're always going to have it in stock for us. So, there's not necessarily a need to pre order. You know, if we go in and we send one of our generals say, Hey, here's a new property turned, you're going to paint the interior of the South nine times out of 10, they can call Sherwin Williams up in there in the next couple of hours. And the pain will be ready. There's a, there is a handful

Pablo Gonzalez: 43:15

of inherent scale advantages of what you just described, right? Like we always talk about this, like data flywheel and how JWB everything is like a flywheel that builds onto itself. Well, you just described of. Having, not having to worry about ordering materials gets solved by multiple things happening at the same time. One is the widgetization of the real estate asset, right? Like you use the same materials over and over again. You know how to re renovate, you know how to maintain, you know how to build these homes all with as few as skews as possible. Two is the, Long term relationship that you have with your vendors you really vet them you build a relationship you keep them So and you give them a lot of work every single month So now they are able to count on the fact of okay, since I have this I want to say guaranteed work But since since I have this easy to prognosticate work as long as nothing go nothing goes wrong here they're able to manage their own side better. That leads to shorter lead times for you. Because you were building out these relationships with these subcontractors, they're storing that because of the trust that's there. You don't have to carry the late, the storage costs and things of that sort. And it's all of these things working in concert that lead to these amazing metrics that you're able to report on. I just thought that that was a, yeah, absolutely. Absolutely. Yeah, man. I like that a lot okay. So Venus has another question. What neighborhoods zip codes in Jacksonville are you mostly invested in? Is that something that you are pretty familiar

William: 44:47

with? Yeah. I mean, honestly, we invest in every zip code. Yeah. Right. We're everywhere. Yeah. all the way up past the airport, all the way down to St. Augustine, which is

Pablo Gonzalez: 44:59

service every zip code. Right. Right. I guess the, most of the, Investment that JWB is actually buying into is kind of like those like four neighborhoods around the urban core

William: 45:08

Yeah, I would say your four your four main neighborhoods if you will, you know, arlington beaches north side west side south side. Yeah a lot of emphasis. And you know, you mentioned certain zip codes three two two one one is a big one. We just saw the pictures there of the new construction homes Yeah, three two two one one in the arlington area. Yeah so One one. I've heard like, oh, wait. Oh, nine. Oh, eight. Oh, nine. Five. Four. Oh, six. Oh, five. One. Oh, yeah.

Pablo Gonzalez: 45:34

Sounds like that ludicrous song when you talk about the different area codes. Roger Evans has a question. I came in late to the show, but just curious, how many builders does JWB use? How do they decide who builds what homes?

William: 45:46

We have two main builders that we use. You're in builders. Okay. Um, we have American classic homes who we've been partners with for a long time, probably 10 years plus. And we have flight builders, which is a, a new builder that we've partnered with just in the past year or so.

Pablo Gonzalez: 46:00

Cool. Right on. Do you know, the decision making criteria is basically pulled into the high standards that, you know, can be delivered? Yeah.

William: 46:06

I mean, American classic, they're handling the bulk volume, just as how large of an operation that they are. So a lot of it just depends on the volume that each builder has.

Pablo Gonzalez: 46:15

Cool. Sweet. The Ringmaster, Drew Barnhill, asks, Has JWB ever entertained putting duplexes on these lots? I know that you're not In the new construction department, but do you know anything about the decision making criteria of that type of stuff?

William: 46:28

Yeah, I mean when I was working in acquisitions a lot of times we looked at it as to okay First off what size is the lot right? What floor plan do we have in our arsenal? That's even going to fit on the lot Yeah, right. That's the biggest thing Yeah,

Pablo Gonzalez: 46:41

because you guys have certain floor plans like you basically have repeatable floor plans the same way that a track builder As like 4 different things that they build in like 1 neighborhood, you guys do that, but you put it in, you fit it into different existing conditions. Yeah, exactly.

William: 46:53

So that's the biggest thing is like, what can I even build here? That's going to work the way that it's zoned. How big is the lot? We look at it really breaking it down as an investment. You know, what can it, what can it be rented for? What can we sell it for? What does that return look like for the, for the potential investor? So yeah, I mean, we're, we're always looking at what makes the most sense for the individual lot in the individual neighborhood. We build a lot of town homes. Mm-Hmm, So duplexes certainly are not the question. Cool. It's all just about, you know, the lot in the area.

Pablo Gonzalez: 47:22

There you go. I'll be like that. Ringmaster. BJ McKay, our dude BJ says, are, we are JWB new builds. kitchens equipped with dishwasher and what flooring goes into new builds, you know that?

William: 47:34

So we're not installing dishwashers unless it's one that we've kind of earmarked that we're going to sell retail. We do sell some homes retail. We don't sell all of our homes to investors. We do sell them to their occupants. So if we're going to sell at retail, usually, not all the time, usually they're going to have a dishwasher in there. The answer about the flooring, again, we've been using that glue down plank product and we're in the process of transitioning to that floating click lock plank.

Pablo Gonzalez: 47:59

Got it. Sweet. Sir Jeff Bolton says, I noticed in the latest turn, a mix of screw in and ball valves. for the sink, toilet, et cetera, shutoffs. Is that mix planned for based on availability? I don't even know what that means. I'm not sure. I noticed I noticed in the latest turn, a mix of screw in and ball valves for the sink, toilet, et cetera, shutoffs. Is that mix planned for, for based on availability? So

William: 48:27

as you saying that The valve. Yes, we're talking about maybe like a shutoff valve, you know, to a faucet or a toilet. A lot of times, you know, over time, those can just corrode and start leaking, or maybe we see that it's on, it's maybe not leaking, but it's right on the verge of it. You know, we may opt to go ahead and You know, get that done. It's a quick, easy, cheap fix. And it's something that could save a lot of headache down the road when a resident's calling in saying my toilet's leaking and my drywall is wet and moldy and my flooring's peeling up because of a water issue. Got

Pablo Gonzalez: 48:57

it. Got it. Interesting. Okay. So then the answer is If they have these shutout files, it's because it's happened because an issue has arised and you've identified an opportunity to put these things in. Yep. Got it. Love it. MVP Lee with a, with a question trying to put you on the spot here. He tends to do this. All right. Feel free to pass. William has this under control. I want to put him on the spot a little. Does he have a go to crew that he calls out in an event of an emergency? And does he want to give them a shout out here?

William: 49:21

Absolutely. Yeah. I've got, I've got to go to, so I guess it, and I guess it also depends on what trade we're talking about. But yeah, so like if I've got a, if I need a generalist that I'm going to call in, I'm always calling my boy Nick from Nitro Solutions, right? He was actually part of the maintenance presentation this morning. Nick used to work for JWB. Right. Um, I know, I know that I can trust Nick. I can always trust Chris from CPT.

Pablo Gonzalez: 49:46

Yeah.

William: 49:46

Right? So again, it all goes back to the, to the relationship building, right? I'm looking out for you. You're looking out for me. I don't have to look at what you're doing under a microscope. Yeah. You know, Adam Eisen always says, inspect what you expect.

Pablo Gonzalez: 49:59

Mm-Hmm. right?

William: 49:59

Mm-Hmm. But I know that I don't have to, I don't have to babysit'em, you know? Yeah. If I've got a plumbing issue, I know I'm gonna call Doug and John from Christian Brothers Plumbing. I've got'em on speed dial. Yeah. Right. I spend a, I spent a half a day out in the field with them last week doing nothing but going around and cameraing drains.

Pablo Gonzalez: 50:16

Yeah.

William: 50:16

So you spend time and, and you build one-on-one relationships, and you build that trust.

Pablo Gonzalez: 50:21

I love it, man. I love how, how big a smile you got on your face when you saw the question and how quick you were to answer it the same way that Lee is saying, because to me, there's just never been, I've always seen the, the archetype, the archetype of like the guy that knows a guy being super, super valuable and the idea and the only become that by building relationships, having a bunch of exposure, you know, like testing and working with different people and building like long levels of trust and it's just really, really clear that From your position and the way that JWB operates with their service teammates and contractors that they use that you, you serve, you serve as that as, as the construction,

William: 50:59

the amount of time that I've had an opportunity to swim with Jim Marshall, who's our director of construction and Larry Holland, who's our production manager. They've kind of instilled that in me. They've beaten it into my head to where I dream about it at night You know this this entire industry and not just construction, but really real estate as a whole.

Pablo Gonzalez: 51:17

Yeah

William: 51:17

It's all about the the relationships that you build It's all relationships.

Pablo Gonzalez: 51:22

Couldn't agree more man. I love it All right Last couple of questions before we head you get you out of there great questions today from the from the q a mike foster asks, do you see much problem with home mold buildup due to florida humidity? You

William: 51:33

Yeah, you could see that a lot of times in older homes. You know, maybe they don't have exhaust fans in the bathrooms. Maybe it's an older block home that doesn't have insulation in the walls. So we have a couple of different avenues that we take to mitigate the humidity issues. But yeah, I mean, it's a real thing. Yeah.

Pablo Gonzalez: 51:49

You're a construction guy in Florida. Well, I say

William: 51:50

welcome to Florida. Yeah. You're

Pablo Gonzalez: 51:51

a humidity pro, right? Yeah. Got it. Just like up north, people are really, really good at Keeping heating inside and weatherization on that.

William: 52:00

You know, 1, 1 thing that, you know, we, we obviously take that very seriously. And we focus on that. So, I actually went out and got a molds, a mold certification, you know, to where if somebody is calling in with a mold issue, we have somebody on staff that can go in and look at it and diagnose the issue with, you know, Fairly good certainty as to what we need to do to get the issue fixed. All right, so you got a PhD in mold, something like that. Yeah.

Pablo Gonzalez: 52:24

Something like that. Last question here. The patron Santorios of the community, Michael Santorios says, William, when looking at the new home inventory, this might not be in your purview, but I'm going to ask it anyways. At the new home inventory on the JWB property site, past new home construction seemed to be four bed, two bath. And now they appear to be Three bed, two bath. Am I wrong in this observation? I'm not sure. I mean, I know that we build both. Yeah. And like you said, it's kind of like, depending on the lot, you have a couple of pitches. Yeah. And depending on the batter, you pick the pitch, right? Exactly. Now that, you know, getting, getting your baseball crowd back up. It all comes back. Since you missed the whole cleanup scenario. Last question for you from me, man, as this As this operation grows, as you see what's happening in downtown, as you like, connect the dots here, based on the impact that you've made in these kinds of neighborhoods. What are you most looking forward to with, with this kind of like the operation and what you guys are doing in the city and stuff like that for

William: 53:23

personal, professional, you know, whatever, whatever you got. I think it's always exciting to see what's going on downtown. You know, again, as somebody that's lived in Jacksonville their whole lives and kind of seen the ups and downs of downtown, if you will. I think it's, I think it's really exciting to see the amount of activity and the amount of emphasis. And I think it's going to be great for the city as a whole. But I also think it's going to be a great thing for investors. Most of those core neighborhoods that we're building and investing in are immediately surrounding that downtown area. So I think that that only can bring good things for our investors

Pablo Gonzalez: 53:55

agreed, man. As I came back from this event, California, like, I was, you know, I was there. I made a presentation on rental property, investing and keeping it passive. Right? So I It was like five profit centers. It was the idea that like you make your most of your wealth with home price appreciation. So you got to be in it for a long time. It was this idea that if that's what you're doing, then order of operations needs to flip and not be just property focus, property focus, and then find a team, but find a team first and then property focus. But the conversations that people really got excited about was this idea of Man, this great american city that's had all this great trajectory And yet downtown hasn't even turned on And all the signs that say downtown is turning on in the next five years. You're not going to recognize it We're headed to that like nashville charlotte Austin Denver kind of status and people wanting to be a part of it. Absolutely. It's really, really exciting as I'm getting goosebumps talking about it as a, as an investor, as a resident, I would imagine that being in like the belly of the beast, that's like really driving this stuff forward. It's got to be super excited.

William: 54:52

It's exciting. I mean, you drive, you drive up 95 and you look over and you see, you know, the development in La Villa, they just recently finished. That's kind of like the first thing on the horizon that you see now. So it's coming. It's coming,

Pablo Gonzalez: 55:04

man. It's coming. I got a question in the chat From jay currup. Do you proactively evaluate homes for maintenance?

William: 55:10

Yes, a lot of times that, you know, when we go in and do a property turn, we're kind of looking and saying, okay, and that kind of comes also full circle back to, you know, the question about how much communication are we having with the portfolio managers? Right? We'll, we'll go out there. We'll write a scope of work and we'll mention something. Say, Hey, look, you know, your air conditioner here. You're going to make it through 1 more lease cycle, but you should probably be prepared on the next go around that we're either going to have some major maintenance or replacement. So we try to prep you up front as much as we can. When we see that something's kind of coming down the pipeline, if you will.

Pablo Gonzalez: 55:45

Interesting. So you guys are. One, you know, like ahead of the next turn, you're giving investors some insight into expectations, right? Like, I feel like kind of like investing in these homes, owning these things for a while, the biggest risk is like surprises. And especially when it comes to the financial side. So you're able to provide some real insight into, Hey, we're renewing this time around this thing doesn't have to happen, but likely at the end of this two, three year lease, I called a Bolo beyond the lookout, beyond the lookout. I like that. I like that. So be out. So Bolo reports, do you ever wear Bolo ties? Is that a thing that you do? Did we just become millionaires? And then the last, all right, Susan has one more question. I know that this is not in your purview, but do you have any pull on getting houses that are currently on septic pushed down the city timeline to convert to city sewer? I wish. You can make just one call, right? I wish. I feel your pain though. Great pain. Yeah. All right. Well, I meant, I super pumped that you uh, joined us again, man, as usual, totally delivered as usual community. Great questions. Yeah. Really good questions on the community, right? Like this thing would have ended a half an hour ago. Uh, so, you know, we never take it for granted that you take a full hour out of your day to hang out with us, have these great questions, add to the conversation. We will always take questions, always answer them. And just really, really appreciate it next week. We're unveiling something new to the world. We're giving birth out here on the natural average investor. You want to know what's going on? Enlighten me. GC and the team have developed a new tool to understand returns and get clarity on portfolio building. And we're doing a natural average investor show world premiere. We're changing the game.

William: 57:31

GC is a numbers guy for sure.

Pablo Gonzalez: 57:33

GC is just cooking them up in the lab now. GC spreadsheet game is unbelievable.

William: 57:39

Yeah, that's kind of like a that's a personal goal of mine. It's like really up my excel game

Pablo Gonzalez: 57:45

I remember when I was in construction, that was always a personal goal for me and it was just completely against my constitution I've got

William: 57:51

a pretty strong base layer. Yeah, we need to start adding some gadgets and gizmos on there.

Pablo Gonzalez: 57:55

There you go Well, we'll see we'll see if maybe in a year or two you're coming out with brand new groundbreaking analysis tools We'll bring you back on. Yeah, Family, we'll see you next week. And from here till then, William, do you know what the piece of advice we always give everybody?

William: 58:08

Don't be average.

Pablo Gonzalez: 58:09

Don't be average. See you next week.