Financial Freedom Fast
Losing $1M and Making a Statement w/ Tyler Cauble
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It ended up being about a million dollar loss. So I turned around and wrote my investors a check for a million dollars so that they wouldn't have a loss in the deal. It wasn't my fault I didn't have to do that, but I'm also not gonna let my investors lose money on a deal, so that sucked. A million dollars is a lot of money and that was the first time I'd ever had a million dollars on my bank account. But at the end of the day, 100% of those investors turned around and invested that into my next deal. Step number one is go out there and bust your ass for three to five years.
Speaker 2:Welcome to the Financial Freedom Fast Podcast, the show that teaches you how to buy back your time and live life on your terms. Learn how to confidently leave your nine to five from guests who've done it themselves. Whether you wanna lay on a beach, travel the world or focus on your passions, this show will give you the tools to do what you want when you want. Now here's your host, Matt Amavio.
Speaker 3:What is up? Financial Freedom Fast Fam. Today we've got Tyler Kabul on the podcast. Man, I am so excited for you guys to dive into this. I met Tyler Kabul out in an event in Nashville. We had so much fun digging into Tyler's story out there. And today we dive into his story and how he thinks what the best steps are for someone to get into the position that he's in. What is the position that he's in? Doing between five and $20 million development deals, huge deals, awesome deals and wait until you hear how he actually lost a million dollars on a project, but what the one thing that he took away from that was, and what he's able to do now. Guys, it's all about these little failures. The failures and the ways that you can learn from people are the best things to take away from stories like this, because you can see what you don't want to do wrong in the future and what you can avoid doing and the things that you can do to avoid that. And we talk about that in this podcast. So make sure that you listen to that, my people, and if you are not already, make sure you're subscribed to this podcast so you get updated when this podcast drops, so you can hear awesome information from people like Tyler. So, without further ado, let's jump into the pod.
Speaker 3:Tyler Gauble. Welcome to the Financial Freedom Fast Podcast. What is going on, my man, maddox? How did it be here, man? Appreciate you having me on, dude. I appreciate you coming on, man. We actually we met out at an event what is it called? Next Level Investor Summit, I think but my good buddy, cody Caswell, sean they put that on out in Nashville Got to meet you, hear from you, hear the things that you were doing and meant it was inspiring. I am excited to dive into your story today. Guys, if you don't know Tyler Gauble, he's a CEO of the Gauble Group YouTube phenomenon. If you go check him out on YouTube, dude, he's doing creative commercial real estate deals. You are incredibly vertically integrated, which I am really excited to dive into. College dropout all this stuff, man. Tyler Gauble. Can you just introduce yourself, man? What are you doing today and what is the business that you have built up for yourself?
Speaker 1:Yeah, man, I appreciate the kind words and yeah, that was a fun event. I met some really some great people there, so that was a lot of fun. So I got started in commercial real estate back in 2013, as you said, after dropping out of college, finished my freshman year, I think that's pretty much it. I re-enrolled my sophomore year, but I went to five classes. Probably should have withdrawn, but didn't even think about it. Nothing that matters. Move back to Nashville and immediately got a job offer from a real estate developer here in Nashville that I had sold cut code to. Actually, the summer or two before he heard, I was back in town and this was back in 2013, when commercial real estate was not doing nearly as well as it is now and a lot of his properties were sitting vacant and he wanted somebody to come in and focus solely on getting them leased up.
Speaker 1:I took over a pretty large shopping center up in Hendersonville, an office building in downtown Nashville and some industrial out in Mount Juliet Focused on leasing those for a while, had no idea what the hell I was doing, so they just told me to go knock on doors until I found somebody that was willing to sign a lease and they'd show me how to do it from there, so I knew how to do that. I was really good at sales and pretty much did just that for two or three years, but every week I got to sit in on the company's development meetings and just listen to what was going on, and I got to visit the job sites, and so I learned how to put together. My first development deal, which I did back in 2015, is when we started working on it, which was 42 townhomes that we built about 15 minutes southwest of downtown Nashville and then shortly thereafter left, started my own company in 2018, and we've been growing everything ever since from there. So started off with the Cobble Group, which is my commercial real estate brokerage. We do mostly investment sales now, advising buyers from all over the country, but we also do some leasing for the assets.
Speaker 1:Here in Nashville. I've got a commercial property management company that manages about 2.1 million square feet of commercial space. We do have 50 apartment units, but I hardly ever talk about those because I just don't do a lot of multifamily and I started my development company in 2020, even though we were buying and really developing property before that, but that was when we scaled to a point where I needed a team, falling in line with the theme of your podcast. Not only am I building that more passive freedom through the income that is generated off of our property, but I've got teams working for me and the companies that I've built now. So if I disappear for a month which I actually do every year I take off between December and January for 30 days, but the company runs on its own and I don't have to worry about it too much. So it's pretty great to be able to have that flexibility.
Speaker 3:Dude. Yeah, man, and one cool thing about the way that you've built your businesses out they all feed into each other and there's a way to basically compensate for each individual business that fuels the other business and makes you into one huge, vertically integrated company. That's building wealth and it makes your investors feel a bit better. You don't have to take a bunch of stupid fees in different areas, because your company is already getting compensated for what it's doing in all different types of ways. So it makes your return to your investors better and you could focus on individual big projects that you want to build out. So let's talk about the vertical integration that your companies do have. How do they all feed into each other? Which business did you start at first and then? How did that funnel into the other businesses that you created?
Speaker 1:Yeah, so we started with the Cobble Group first because it's a commercial real estate broad majority. I had my license, basically zero overhead. I started off working for my house, then got a mobile desk or whatever at a coworking space and then we've just grown from there. So I had that for about six months before we started the property management company. Brokerage is great, but you're not getting consistent income because of the way that the deal cycle is, and so I had a couple of clients that were actually selling residential portfolios and buying shopping centers and they needed a commercial property manager, and I had some of that experience from the last developer that I worked with. So I just decided you know what, let's just start this company, and it's never been a huge money maker, but it's very stable and the good thing is we've got great property management team now so I don't have to worry too much about it. Property management is probably my least favorite side of the business. And then, a couple of years later, started the development company. They feed each other into each other through that way.
Speaker 1:Right, the Cobble Group goes out and finds the deals right. Sometimes it's just me, and if it's just me, I may or may not charge a commission on that. But if it's my team, we definitely do. I pay them to do all the acquisitions for us. And then Hamilton comes in, raises the capital, takes it down, develops the property and then hands it to Parasol to manage. So it works out pretty well.
Speaker 1:We tabulated the amount of different ways that we get paid on a single deal and I think it's like 10 or 12 different ways, that we are like 10 or 12 different income streams per one deal. So we don't have to do nearly as many deals to make it make sense. We think about it like On the brokerage side, in one deal we get paid a commission on the front end, leasing commissions, and then a commission on the back end. We get paid for the property management side, just a property management fee. So that's four ways right there.
Speaker 1:Then on the development side, we're getting paid an acquisition fee, a disposition or REFI fee, a development fee and asset management fee, and I know that there's a couple of others. The nice thing, kind of like what you alluded to we don't have to fee up our deals. So they're not huge fees, they're just we've got to keep the lights on. For doing all of this different work We'll charge one to 2% on an acquisition fee, instead of four or 5%, like I see some other people do. We'll charge a half a percent on our disposition or refinance fee, instead of two to 3%, like I see some other people do. So it does save our investors money and it really aligns our interests pretty well. And they know too that I've got my hands on every aspect of the deal from the moment that we start looking at it. So they know that we know exactly what the game plan is and that we're gonna be able to you know roll with the punches whatever make up.
Speaker 3:Right, yeah, you've got all pieces of the business that you could put together. You're not really having to hire out too many different companies to come with you third parties so you've got control almost over the entirety of the deal and you've got the experience and team to be able to get it done and put your full focus on that one deal. So this vertical integration is I would like to dig into that a bit more, but let's start with the brokerage. So that's where you started off and you mentioned that you started there because there's zero overhead. You don't really need other people. You can focus on you and your sales skills. So what made you? Were you always a natural salesman? Were you always good at that connecting with other people? Or were there some things that you had to learn? Were there courses you took, things you did? What were the main drivers behind building up this skill set that you have?
Speaker 1:Yeah, I think that's a great question. Looking back, there are probably some instances where you could see where I might make a great salesman. My dad was in sales. He's just got a good personality for it. But that doesn't mean that growing up I thought I was gonna be in sales.
Speaker 1:I always figured I'd be the CEO of some Fortune 500 company, and that changed when I decided to drop out of college. So I was president of my freshman class. Back in high school. I was president of the service club my senior year. Those were never really things that I thought would translate into this. But looking back now, look, I had the ability to speak in front of people and I had the ability to bring the right team together and lead.
Speaker 1:But it was really when I graduated high school I did Cutco that I learned that, wow, I can really sell.
Speaker 1:And it all comes down to your personality. Right, it doesn't matter how much training you get if you have the wrong personality or you just don't know how to read people. Cutco, combined, like my relatively outgoing personality with the actual sales knowledge, they had a bunch of training there and I was surrounded by people that were very interested in personal growth, which was not something that I had ever experienced before, but to me, to be fair to myself, I was 18. I don't think anybody in high school's reading Rich Dad, poor Dad at least not back in my day people weren't, and so it was a combination thereof, and I am still very studious just by dropping out of college. I read all the time and I'm constantly listening to podcasts and audio books and watching other people's interviews and YouTube videos, just trying to figure out what else can I learn to further implement into my business and my goals, because just because you go to college doesn't mean that you learned anything, and just because you're not in college anymore doesn't mean that you need to stop learning.
Speaker 3:Yeah, dude, college man and this is actually the first question I wanted to dig into when you mentioned that but, dude, so I graduated from college. I did really well, I got the 4.0 GPA. I did all that stuff business school, all that but, dude, I wasn't the studious kid man. I just knew how to suck up to the teachers and make friends and be able to find out exactly what's gonna be on the test and do all these other things. I don't think college really teaches you that much. What is your mindset when talking to? If somebody who was 16, 17 years old came to you and asked you, tyler, should I go to college? What would be your response to?
Speaker 1:that. Oh man, it's really tough, because there are some people that need college right. You've gotta go do that. You have to go through that process and there are some people that just don't. And I think the majority of the population probably does need college right, because you need to experience what it's like to be in an environment where you are teaching yourself how to learn and how to maintain a schedule and how to be responsible for yourself before going out into the real world. But I think I would have to dive further into what have you been doing your whole life Like when I decided not to go to college, I had grown up working for my grandfather every summer since I was 12 years old, in construction.
Speaker 1:I was the kid that they would hand the sledgehammer to and I'd go in and do the demo in the bathroom or carry all the lumber, whatever anybody needed. I was just the guy that was there doing it, and so I had a work ethic already built into me. If you don't have work ethic, then it doesn't matter what you do right. It doesn't matter if you go to college or not. Go to college like. You're gonna have a lot of issues either way, and I think that I had self-discipline to where I was willing to put the work in. I already knew what I wanted to do and I had a good enough education from high school to not really need all of that. And also I didn't wanna be an engineer or a doctor or a lawyer right, those are things that you obviously have to go to college for. This isn't. Was it Step Brothers, where he's, I would have joined the family business, but you're a doctor.
Speaker 3:I mean, I 100% agree. If you're going for something that needs the college education, then go do it. But if you're not, if you wanna go and do something like development, what I would do is go and find a guy like Tyler or somebody else in the space that's doing something that you wanna go do, and then I would go do that with them and learn from them. Man, so we've got the. You go into college, you drop an hour, you did the cut code thing. You figured out making money there, how to do that. You built your sales skills. You went and started the brokerage, you started property management and then that kinda it was property management was the next business you built after that. Correct.
Speaker 3:Yep, yep brokerage property management, and then development, and then into development. So let's talk about development. Obviously, you worked for a developer for a little bit and you were able to see what the business looked like, how these deals get put together. What did you come into this business like, knowing exactly all the pieces of the puzzle that have to be put together? Or were you coming into this and still learning as you were going when you started this development company?
Speaker 1:Yeah. So before we dive into that, I wanna give one other piece of advice on the whole college piece, one way to look at it. This is one thing that we don't really have anymore that we totally should are apprenticeships. If you're 18, you don't wanna go to college, you wanna get into real estate, there's a couple of different paths that you can take. Right, like you could just get your real estate license and go do your own deals.
Speaker 1:I think that's a big mistake for a lot of people. I don't think that you should just go right into business for yourself, because there's a lot of stuff that you're not gonna know. You didn't go to business school. You know there's so much you can learn from working under somebody else that's been doing it for a while. Treat those first four years 18 to 22, as an apprenticeship. Who cares if you're making $10 an hour, because you're basically getting paid to go to college? Right, that's the way that I would look at that. You spent four years studying everything that you can from a real estate investor or developer or an architect or engineer, whatever you decide to do and you will learn so much more and you're gonna get paid to do it. So just do it, don't try and aim for the moon.
Speaker 1:I've got kids that come to me that are like, yeah, I want you to pay me $60,000 and then teach me how this business works. I'm like, not a chance dude, You're worth like $30,000 a year right now because you don't know anything and also, it's just. That's just a weird approach, right, it happens all the time. People just have this skewed view of how much money they should be making without ever having proved it before. Right, look at how many kids come out of college today and think that they're worth $80,000, $100,000 a year or more, and they're not. Most of my friends, when they graduated college, were making like 40 to 60. These are guys that had really. They were really good people and smart, sharp, hardworking.
Speaker 1:So, anyway, back to the development piece. The thing about development is you learn the structure, you learn the bare bones, you learn how the deals are supposed to flow, but every single deal is completely different. So I knew enough to know how the process worked and then combined that with my ability or willingness or drive to just make it happen to go do these deals right. We run into roadblocks on every single step of the deal, every single step and there's so many points where we can just be like, oh, let's just give up and walk away, and that's what makes a great real estate investor or developer. Everything that is just understanding that everything you're doing is solving problems. That's all it is. You're just solving problems that the next guy is not willing to solve, and that's why you're getting paid to do it. So what is?
Speaker 3:what if somebody wanted to develop a deal? Right now, like you're doing all this different creative stuff which we're going to dig into, but what do the different parts? If we were gonna break down a development? What do the different parts look like? What do they consist of? On a development deal.
Speaker 1:Sure. So there's acquisition and underwriting right. So you gotta go find the deal, run the numbers, make sure it makes sense, get it under contract. Then you're gonna do your due diligence. So just gonna entail everything from surveying the property to getting a phase one of our middle done, engaging your contractor, architects and engineers to see what can be built on the site, what's feasible for your plans. And then, once we've gotten past those stages and we've determined yes, it's worth moving forward on, we put together an off-end memorandum. We go race capital, secure the death from a lender and then close on the deal and hopefully start construction soon. Thereafter you submit your plans from the architect once you have those two permits. Once you get your permits, you're breaking ground, building the deal and then it's just construction management from that point on. And as soon as the deal is done and delivered, then it's all on the leasing and management team to take it over from there. So that's certainly an oversimplification of the process because it's quite a bit and that's-.
Speaker 3:That's in just two minutes to put a deal together like that.
Speaker 1:But that's who we are? Absolutely not. I mean, if you think you've gotta look at a hundred deals to make a five plex or a 10 plex or 20 plex work, imagine how many you have to look through to make sure that taking out the risk of development is gonna work. And then financing is 10 times harder and raising capital is at least twice as hard. There's a lot of stuff to it that's far more difficult, but it's more rewarding. We're able to get our investors really good returns, but that's also because we're taking significant risks.
Speaker 3:So let's talk about. What does a development mean to you? If you had to define what a developer does and what you're doing as a developer and what is development what would you say?
Speaker 1:Yeah, developer just envisions what could be done with a piece of land and they bring it to life Right. So it could be a raw piece of land. You could do what's called a redevelopment and buy an existing building, tear it down and build something new or completely change up that use. Like I would consider our project, the Wash, which was a six-bed car wash that we converted into five micro restaurants and a bar, to be a redevelopment, even though we kept the original structure of the car wash there because we basically re-did all of the infrastructure, built this new building on it and I don't know that I would call it necessarily a development because it wasn't technically ground up. Yeah, I think it's pretty all-encompassing. If you're just gonna buy a building and put a coat of paint on the wall and maybe change up the interior floor plan, that's not a redevelopment, it's a lipstick job.
Speaker 3:That's right. So with the projects that you've done, let's go over some of these projects. So you had the Wash awesome facility. I went to it out in Nashville and got some food there Really good, really cool. What are some of the other projects and redevelopments or developments that you have done in the past?
Speaker 1:Yeah. So after the townhomes, my next project was a little 6,000 square foot office building, two tenants. We bought a vacant. I barely did anything to the building, leased it up and flipped it for gosh. We bought it for $575, probably put $30,000 into it and sold it for $750 in less than 24 months. So it was a nice little flip. Then we did a 12,000 square foot office building, converted that from six larger offices into 17 smaller offices and leased that up to 17 tenants in about six months, give or take and sold that. And then we're sitting in a building that I bought back in 2019.
Speaker 1:This is a 28,000 square foot three-story office building that was 40% vacant when I bought it and now it's over 90% occupied. We renovated it, really upgraded all the leases and all that kind of stuff. We did a deal down in Chattanooga where we bought a nine-story tower and we were gonna convert it into micro-apparments, but we ended up getting an off market offer for two and a half times what we paid for it in 18 months. So we had to take that. That's one of the positives about being really good at acquisitions and being able to find deals so you can have multiple exit strategies and everybody's happy. And now we've got a. We just started construction on my hotel which is right down the street from here 48 rooms, that'll be a boutique hotel. Rutter contract on another boutique hotel here in Nashville. That's 79 rooms.
Speaker 1:I've got a one and a half million square foot former Woolmill out of Chattanooga it's 29 buildings on 32 acres that we're master planning for a mixed use town center, trying to keep all of the buildings there that we can. And then I'm also master planning a community in Madison, which is probably 10 minutes north of here, for a one and a half million square foot town center. There are two. I guess that one's different because we're tearing down the existing shopping center and building all new construction four and five stories, but we're just master planning it. So that'll end up having about 1,100 apartment units, few hundred thousand square feet of office and some ground floor retail. So we can do a little bit of everything. You can tell I've got deals as small as my office where my team is, which is not where my studio is anymore. That's over by the wash. That was a little 480,000 dollar deal All the way up to I think the largest that we've acquired today was $18 million. Dude, you've got deals how old are you?
Speaker 3:31. Dude, that's insane, bro. Where do you put your focus, man? You've got all these different projects all over the place, I'm sure 80, 20, rural Pareto principle, 20% of the activities we do bring 80% of the results out there in the world. What is your 20%? What are you focused in on that's driving all of this business for you and all your businesses?
Speaker 1:Yeah, it used to come down to just how hard I would work in a single day, and that was one thing I knew that I always had was that I would outwork anybody and that was great for the longest time, and that eventually you just get tired of that, right? Everybody always just says I'll just work harder. There's seasons for everything, right? I don't really want to work that hard anymore. I look back on that and I'm like, damn, I'm glad I did it, but I don't want to do that anymore, no more. Now it's more of focusing on the things that I think are going to bring the teams the best and most amount of business, right? So now back in the pandemic. We started the YouTube channel and the podcast and my blog took off. So now I'm focusing the majority of my time on that because I'm reaching an audience across the country, across the world, and we get business out of that. So I've got a team of brokers that crush on the investment sales side for us. I don't have to step in and do anything for them anymore other than hand them leads. So I'm like, okay, let's just do two more YouTube videos this week and it'll generate leads On the property management side, they don't really need me.
Speaker 1:I've got partners in there that kind of manage the employee side of things there. I just have to go out and find some deals. And really the same for the development. I've got a development team that helps with everything. You know, of course I go out, find the deal to the underwriting, but the initial vision together. Then they walk it through the whole process to make it come to life. And I'm involved, of course, throughout the whole process, but not nearly as much as I would have to be if I was a solopreneur. So now the majority of my time is spent on business development and creating content, because it opens us up to a wider base of clients, investors and Partners whomever else.
Speaker 3:We need to get out there and see right, and if somebody was starting today and they saw the journey that you took and there's a bunch of different parts of this journey which I really like, there's a pretty good step-by-step that if they wanted to recreate the entire business that you add, you could go Brokerage and then property management and then development. You could do that step by step, ladder there and go and create that. But if somebody wanted to create something similar to what you have today and they're starting from scratch let's say they just actually graduated college and they don't have they don't have anything built up, no investments, nothing like that when, would you say, step one is and what are the steps that you would take in today's market to build up the business that you have built for yourself?
Speaker 1:Yeah, so one one mistake that I see a lot of people make is that they immediately try to become an influencer or a content creator, and I have a lot of problems with that, because you don't know what you're talking about. You don't have any of the real-world experience, and I think that it's great that you want to try and teach other people to do it, but a lot of people that start doing that stuff it's for the wrong reasons and they try and flash their cars around and talk about how much money they make. I've never done any of that and I think that's a big reason as to why my audience has gravitated towards me, because I'm a real, commercial real estate investor. I'm not grand card own doing a selfie video. Hey, I'm on my private jet, check me out. I don't care. I don't live a flashy lifestyle. I don't really care about any of that stuff, because I know, as an actual real estate investor and not some swindler, that Every dollar that I spend on a stupid car is a dollar that I can't put into real estate, and I'm here to build a lifestyle to where I'm making a hundred thousand dollars or a million dollars a month, completely passive, without me, so I could disappear to Europe for two months and Know that I don't have to worry about a damn thing. Step number one is Go out there and bust your ass for three to five years before you start doing any of the content. That's something you want to do? Cool, do it? Just actually learn something? I Didn't know anything when I first got into it, so read every book I watched, I listened to every podcast there weren't really YouTube videos back then, but and then I spent three years doing nothing, believing, I mean nothing.
Speaker 1:I didn't even take on sales because I didn't know anything about it and I was just doing every deal that I possibly could. So I learned how to creatively negotiate contracts and put all these deals together, and because of that, I ended up writing a book on how to lease commercial real estate. Hmm, and After that I got into the development side, and it was around that time that I started right. When I got into development actually, funny enough, it's probably when I started my Instagram account, and it wasn't again nothing flashy. I just documented the behind-the-scenes journey of what it looked like going through this. Right, I think that my first like Instagram photo is If you scroll all the way back. It's like a picture of me in front of our for sale sign of the townhomes and I'm just like talking about like how cool it is to get to this point and, after all this work, we're finally selling this product and that's what people really gravitate towards.
Speaker 1:I want to see. They don't want you to sell them Something every single time you're on Instagram. You know it's like Gary Vaynerchuk's jabber right hook. I can't stand the guy most of the time, but that's a pretty good point right there, right, give a whole bunch of information that people want to see and then ask him for something. We were talking about this today.
Speaker 1:I want to start a new series on my podcast called the story of the deal.
Speaker 1:We already bought the domain and I'm gonna start bringing on people to interview on my channel, going in Death into one deal, like we're gonna tell the whole damn story.
Speaker 1:I want to know how you found it, how you underwrote it, who gave you the money to do it, what happened that you weren't expecting Dispecting, because that's what people want to hear. Right, I'm I may not get anything out of that, and that's totally fine, but that's what my audience wants and I just think that'd be really cool content to have, because I always try and think back of what would 21 year old Tyler have loved to have heard when he was first getting into the business, and it's the analysis in depth of a deal. That's how I approach it. But yeah, once you've busted your ass for three to five years and, let's say, you became a commercial real estate broker, which I think is one of the best things you could possibly do if you're in that position, because you're gonna learn the business from the ground up. If you can learn how to find tenants and analyze deals or find properties, it doesn't matter what you do after that. You've you already know and then Go ahead.
Speaker 3:I was just going to double down on that fact. Being able to do that and put yourself in the position when you can lease out units, or even maybe you have a deal flow of units coming to you now that puts you in a position where you have so much value as yourself. Now you can offer this value out to other people where maybe you don't even go out and create your own development company, but you can partner with a current developer and bring them deals and be able to possibly get equity in on these deals. Just for using the skills that you've built up as a commercial broker to be able to bring Properties to developers and put these deals together, lease properties for them. Know that you could have your leasing in house. There's so much value that can be created from that. So 100% I agree with that. Go on, you were about to jump into step two, I think.
Speaker 1:I'll add to that too. Like I didn't have any money when I first started out I didn't have a damn dollar. Like I bought my first property in 2019. I just started my brokerage in 2018. I was just trying to survive. Right, and you can make good money in commercial real estate brokers, but keep in mind, in 2018. I'd only been in the business about five years. I've been in the business for five years and now I'm starting my own business and I'm doing my own things and now I'm trying to figure out how to market as well as do taxes and all that kind of stuff. Hire a CPA, don't, do not try and do any of that stuff. But the reason that I was able to start buying deals wasn't because I made a whole bunch of money. It was because I knew how to look at deals, how to find deals, how to find tenants, and I had built relationships with investors over the years on my still to do. This day, I'll just go out and find a hell of a deal and take it to an investor and be like hey, let's partner on this. You raise the cap and I'll do the deal, and we knock it out of the park like that nine-story office tower. I didn't raise a damn dollar for that building. I ended up with 40% of the general partnership, so 28% of the total deal for not raising a dollar, but it's because I found it. I ran the whole deal, put the whole plan together and we were the ones that found a Somebody to buy for two and a half times what we paid for it.
Speaker 1:I, if you're taking the brokerage approach, get out there, network with every investor, go help them find some deals. Don't get involved in the first ones. You're not worth anything and they're not gonna trust you and you don't know each other well enough. Just bring them really good deals and then you're gonna know what their buybox is right. Their buybox is exactly what they wanna buy. I want 5,000 square feet of retail in eSnashville that has at least one tenant in place for under a million dollars. So you're like, okay, cool, anytime I find that property, I can go to this investor and I know that he'll buy it. And then, after you've taken them two or three, you can say, hey, look, I found this really good deal, I wanna partner with you on it. And they'll be like, hell, yeah, come on in, you can go find me tenants, you can manage the property, do whatever, and so that's what I did.
Speaker 1:My first deal $575,000. I got paid a 3% commission on it which I rolled into the deal, so technically $0.00 at a pocket, rolled that into the deal and I took an extra 10% for finding it and putting it together. The other two guys put $50,000 in each and I got 25% of the deal. It was a hell of a deal. But also you gotta think, like these guys that have money, they're not necessarily the guys that wanna be out there finding the deals right. If today I'm already saying I don't wanna work as hard as I used to Imagine somebody 10 years ahead of me Dude, I'm going to the beach with my family, I don't have time to go drive for dollars. Somebody that can find deals and bring them to them is so invaluable.
Speaker 3:Dude, it's so valuable, like last week that deal I told you about that I closed on. We had I brought an investor in to bring 150,000 to the table for that. I found that it was literally on market but I was able to make offers, negotiate and deal with the other agents as a commercial broker, so I was able to get I actually took a $10,000 commission on that property that I was able to keep. I got 40% equity in that property. I didn't have to put it and it's valued at $860,000. I didn't have to put a dollar down to buy that property and I just need to use my expertise for I actually got paid to get the property for ownership in the property and I just need to execute on the stabilization plan that I built out for that asset now. So it is learn the business, learn what goes into creating value and creating assets and then go out there and create value for other people and when they see you consistently doing it, you can work yourself into deals in different ways.
Speaker 1:So love love that and I love writing my investors massive checks because it means that they're gonna be super happy. They're probably gonna invest that with me again and I made some money too, right. So there's so many people I hear this all the time from younger people getting into the business oh, would you do a 50-50 split on this? And I'm like I don't think any investor is gonna do a 50-50 split, with them putting 100% of the cash in and you executing the deal. When you have no experience, be willing to take 10% because you're getting to do the deal. You get to add that to your track record. You get the trust of the investor.
Speaker 1:My first deal the 42 townhomes I owned, 10% equity in that deal. That's it, 10%. But that's a lot of money and it was a hell of a successful project and it got me off onto the path that I'm on today. And if I had argued with that ardor that no, I want 50%, he would have said get the hell out of my office and that deal never would have happened. So 10% is a lot if you don't have to put any money up and you don't have the balance sheet to get the loan anyway.
Speaker 3:Get a piece of what you can man 10%. 5% of something is better than 0% of nothing.
Speaker 1:I know guys that'll go out there, that will do these deals just so that they get the leasing and management and side of things, because they know the leasing and management side really well and it brings them business right Like they're getting paid to do that. So it behooves them to go out there and find these deals for these investors so that they can take on those assignments. Don't get greedy.
Speaker 3:Yeah. So I think, just diving back to the original question that was asked like, what is step one? Go out there, grind, figure out where the value that you can add out there is, Create enough value within yourself and then bring that value out to other people to show them what you can do for them, what you can create for them, and that'll eventually work its way back to you. A question that I've got for you, digging in more on the personal side what is, what's your why behind everything that you're doing Now? You were grinding in the beginning things. I'm sure you're still probably grinding a bit. Things are calming down a little bit for you. What's your why right now? What's driving you?
Speaker 1:I just wanna do cool projects with cool people. A lot of our projects are small business oriented. I'm from Nashville and Nashville has changed a lot over the last 10 years, and so I feel that I have a responsibility to come in and help Nashville preserve a little bit of what made it so cool. Now it's a lot of it's getting torn down and turned corporate, and that's great, right, it's progress and it's gonna happen in every city. But the more projects that we do, the more small businesses will thrive within our neighborhoods and the more of that cool national factor will remain. So that's why we do what we do. It gets me out of bed. I make the joke all the time. A dollar general called me tomorrow and told me they wanted me to be their preferred developer on a hundred units and tell them no thanks. It's just not interesting to me. I'm not gonna go travel to the middle of nowhere, to a 500 person town, to build a dollar general. That's not my mission.
Speaker 3:All right, man, you gotta do things that are actually fueling you, because if you're not gonna be interested in them, if you're not interested in something, you're not gonna do it well and you're not gonna do it with your full heart. If you're not doing it with your full heart, you might as well not even do it at all. So love that man. What are some highs and lows that you've had throughout the whole story? I think we learn a lot. The highs are always cool to hear, but I really like the lows, because these are some of the failures that we run into and things that we can learn from most. So what are some of? Let's dive in the lows first and then we'll talk about some of the highs after that.
Speaker 1:Yeah, so the lows. Last year I lost a million dollars on a deal because one of the partners decided to basically go against the best interests of the investment group and pretty much stole the property from us. He bought the debt on the property, which we thought was a good idea because we were all sitting around the table going yeah, this makes sense, we'll take out the seller financing, we won't have to worry about anything. He ended up buying it, never technically sent us notice of it, even though we knew about it. Never sent me notice to pay because we had said he had told us he was like look, don't worry about paying the monthly payments on the land, we'll just basically lump sum that once we get closer to closing our construction loan, you guys can catch me up on it. It was like cool, that works great. Now we don't have to worry about cash flow for a bit.
Speaker 1:And about six months into it I had assembled another two acres to this site. So it went from being 50,000 square foot development to a couple of hundred thousand square feet and it went from being just a mixed use office and retail strip center. Basically A lot cooler than a strip center. But let's just call it that for now and into a multifamily apartment complex with a hotel and mixed use commercial and he realized how valuable what I had put together was and if he stole it all he would make about five to $7 million. So he sent us notice of foreclosure and that was on like December 22nd. So I basically lost 10 days, had to pull together a bunch of cash, got the cash together in the bank to pay off the note before it hit foreclosure, and then the title company, which first of all I couldn't believe I pulled that much cash. It was like $2 million, $3 million that we had to pull together in less than 20 days, basically Wow.
Speaker 1:And the title company ended up not issuing a title policy audit because they needed more time. They were like, oh, this is too big of a payoff, we can't do this, that and the other, and I had never heard of anything like that before. And so we ended up missing it, went to foreclosure. They took one piece of the property and I ended up keeping the rest and selling it all off. It could have been a $7 million loss.
Speaker 1:It ended up being about a million dollar loss. So I turned around and wrote my investors a check for a million dollars so that they wouldn't have a loss in the deal. It wasn't my fault, I didn't have to do that, but I'm also not gonna let my investors lose money on a deal so that sucked. A million dollars is a lot of money and that was the first time I'd ever had a million dollars in my bank account. Sucks to turn around and write that off to somebody else. But at the end of the day, 100% of those investors turned around and invested that into my next deal. But that's a testament to building goodwill with your investors and showing them that, no matter what happens, you're gonna do the right thing, even if you're not obligated to.
Speaker 3:Dude, that gets me fired up just hearing that man. That pisses me off so much that somebody would do that. But man, these are the things that you. You can't watch out for. These things. You can watch out for yourself and the things that you do, yeah, but you never know exactly the intentions of the people that you're working with. That's pretty crazy. Never heard that, with the title company not being able to close especially. It was insane. Oh my, I bet you were fumed bro.
Speaker 1:I was in Charlotte, north Carolina, with my girlfriend for a weekend trip when all of this went down and I was like I ended up just staying in the whole hotel room pretty much the whole time because I was like sick to my stomach. I just I couldn't believe what had happened. But yeah, look, as savvy as I am and as much as I know about this business, like it still happens to me. The thing is you can't prevent it, right? It doesn't matter if you never have partners, a vendor will screw you. Doesn't matter if you never have vendors, a partner will screw you. Family members will do it. Once you start talking about these higher dollar transactions and opportunities, money just changes people and I'm not that way. I don't care. To me, money is money. That's why I was fine turning around and running a check to my investors for a million bucks. I was like this will come back, but it doesn't really matter. I can always make more money, but I can't salvage a poor character.
Speaker 3:And no, and it says volumes to the person that you are the operator, that you are the investor you are. When you turn around and like you had the mindset that, like I am not going to let my investors lose money, you could have said, guys, this is exactly what happened. Here's the issue. We got screwed. I'm sorry we lost our money, but you didn't Like. You went out there, you took this as a lesson and you paid them back and they brought it back to you. I think probably the biggest lesson you might have learned there is, like you said, I didn't even know I would be able to raise $3 million in 20 days and now you can't. And now you know that. So that's a big lesson. It allows you to do bigger deals in the future. What about some of the highs that you've had throughout your career?
Speaker 1:Yeah, after diving through that, we definitely got to talk about a high. So back in 2020, I had done a couple of deals I'd done I guess I own four office buildings at this time, but they were all smaller. I think we're sitting in the largest one, which was like $1.9 million, so not a huge deal and we were coming out of the pandemic and we were in the middle of the pandemic and people were still scared and there was this opportunity to buy this $18 million shopping center that sat on 32 acres the one that we're master planning today and I saw it and I was like I can't believe that nobody's buying this. But it was on the quote unquote wrong side of the river right, and it was in Madison, which is just north of East Asheville, not even 15 minutes from downtown, but all of your older development guys, they developed on the south side of town. So it was a huge opportunity. I'll put it in this perspective. We bought it for $13 a square foot for the dirt and we're under contract for over $50 a square foot for one piece of it. That's a significant jump almost I work times yeah 4X of what we bought it for, and it's not even been a couple of years that deal came across and I didn't have any money and it was $18 million and to put their earnest money down had to put down 1%, right, so $180,000. So I called up an investor and I had him put that money up for me to go buy this deal and I told him, hey, I'll pay you back as soon as I can and whatever.
Speaker 1:And there were multiple times still at that process where that deal fell apart. The leases were just an absolute nightmare. One of them were from the 1990s. The shopping center's been around forever. A lot of it was just very disorganized, didn't make any sense. There it turns out like part of the survey was wrong, just a crazy number of things and I couldn't find the capital to put it together. And I was talking to a few different groups and then this group out of Texas came in and the deal was gonna fall apart like December 31st, right New Year's Eve. And I was on the phone with them at 10 o'clock that night New Year's Eve trying to negotiate and hammer out this deal and we finally got it done and extended.
Speaker 1:Everything Ended up closing in April. So I went from almost losing basically $400,000 of money that I didn't have right Because I had engaged attorneys. We had all of this due diligence, all these due diligence fees, we had the earnest money deposit all this kind of stuff to a massive swing to now we bought the shopping center. So that was definitely a high. There's a lot of work and that's part of what I was saying earlier. I don't wanna do that again. It was an incredible amount of risk for a deal that I probably realistically had less than a 1% chance of pulling together, but I just did everything I could to make it happen.
Speaker 3:Dude, in the stress of those deals, man, when you've got just deal with the capital side of it too, like that, exactly what happened on this five-year that I was trying to put together and get this deal done, had the capital backed out, then got the other capital, but then there's an issue with the title, and then there's an issue with the survey, because the property lines are a little bit further than this property outside, dude, and it's just each individual issue. Do you want me to get this damn deal done or not? And it's just keeping that mental fortitude of push forward one more step. See where it happens. If the deal falls apart, it's gonna fall apart, but I'll be damned if I don't take the next step, the next possible best step for me to go take to see if I could possibly put this thing together, man. So I love it, love how you are, love how you're pushing together, man.
Speaker 1:Dude, the first indication that I ever did I had the money secured. It was like $400,000. We were all lined up like 30 days before closing, right. I was like, oh, we're set A week before closing. Let's say, 10 days before closing one of the investors calls me. He owns like a couple hundred doors residential, all single family, and he goes I just don't really understand this deal, I'm not gonna do it. I think it's a bad deal. And I was like that's fine, man, you don't have to do it, I'll find somebody else to replace you. He called several other investors that were going in with us and he told them hey, I'm backing out of this deal, I wouldn't do it. And so the week before closing we lost a lot of money and we had to scramble and go do it.
Speaker 1:And dude's clearly an asshole. I'm really glad that deal ended up absolutely crushing it. We gave our investors a 29% IR in 16 months and made him look like a total dumbass. But people just do things to you Like there was no reason that he needed to call everybody else and tell them to back out. There's no point. Just because you don't understand something doesn't mean that the deal's not going to work Right, or just a single family investor? People are just going to try and do things to you, to spy you for no reason, so just be prepared for that Dude just work through it and With the punches and do what you do.
Speaker 3:Yeah, man, roll with the punches, do it, and you can definitely take a few punches. Man, you're just from a physical standpoint, man, I feel like you don't like a bear, like almost an albino bear. Dude, I'll take it, yo, if you guys don't know, you got to look them up and check them out, man, you'll see what I'm talking about. But last two questions that I've got for this podcast today are final two questions. What is one actionable step our listeners should take today to start on their path towards financial freedom?
Speaker 1:Learn how to underwrite a deal. Do everything you can to learn how to underwrite a deal, because a lot of people don't understand it, and if you know how to run numbers and do it effectively in a way that most people can understand, you're going to be better for it.
Speaker 3:You're golden and you understand deals and you know how to get into deals. If you get underwrite deals, you know how to find good deals. Whether you go and buy that good deal, or you find an investor for that good deal, or you bring that good deal to someone else and then you get equity in that deal in the future, or they just buy it. You get a commission Dude. You learn how to underwrite deals. You can do so many different things with that. I love that Final question I've got for you today, tyler. What is one question you wish I would have asked or one topic you wish I would have covered, and how would you have answered that question or how would you have expanded on that topic?
Speaker 1:Oh man, one question I wish you would have asked what is my favorite restaurant at the wash?
Speaker 1:What is it, bro? Man, it's always tough, right? Because, like when you pick and you get to, when you do your own food haul, you get to pick all the restaurants that you want to eat at on a daily basis. And it's nice because my office is next door so I spend most of my lunches over there. Man, they're all good, they're all so good it's tough to pick a favorite. I would say right now it's winning in the past couple of weeks is Sweezah. It's a super quesadilla, dude, it's the best damn quesadilla I've ever had. But everyone there is so good. We've got Thai fried chicken, we've got Vietnamese, we've got Cuban and Peruvian, and then the bar. I love it.
Speaker 3:It's fun, dude. I love it too, man. It's a cool space to go grab some grub and hang out. So if you guys are in Nashville, when you go to Nashville, if you haven't visited Nashville, you got to get out there. Man, especially if you're in my position, you're single and ready to mingle. You got to get out to Nashville just because it's a great time. Tons of cool bars and interesting areas that are coming up out there, and Tyler's a good reason for some of that stuff that creative stuff that is coming up that you could go have a good time and go do. Tyler, where is the best place for my listeners and watchers to find you online?
Speaker 1:Yeah, I mean, if you want to learn more about commercial real estate, go to YouTube. Just type in my name, tyler Cobble. We've got over 300 or 350 videos at this point about various aspects of commercial real estate. And then, if you want to connect with me and follow the behind the scenes, go to my Instagram. You can either just type in my name or commercial in Nashville.
Speaker 3:Go check it out people. So, tyler Cobble, you'll see we'll link to some of that in the show notes. I always say that I'm going to do that and then we never link. But I'll try and do that in this video. Tyler man, it has been a pleasure having you on the podcast. Brother From the Financial Freedom Fast Podcast. I'm your host, matt Amobile. Today we add on Tyler Cobble and we are signing off. Thanks, tyler, appreciate it, matt.
Speaker 2:Thanks for listening to the Financial Freedom Fast Podcast, the show that teaches you to buy back your time and live life on your terms. Be sure to subscribe to this podcast wherever you're listening, and follow us online at Matt Amobile. That's Matt AMABIL. Be sure to tune in Monday, wednesday and Friday for our weekly podcast drops. Thanks for listening. Let's retire together.