Dr. Lindsey Duguet: Doctor turned Real Estate Investor shares Prescription for Wealth

In this episode of The Gould Mine, we're joined by Dr. Lindsey Duguet, an emergency physician who transitioned into a real estate investing powerhouse. Lindsey shares how diving into multi-family investment offered her a lifeline from burnout and paved the way to financial freedom for her and her husband. From her first deal to building a significant portfolio through Real Estate syndication, we cover Lindsey's journey and the lessons learned along the way.  Welcome Lindsey, to The Gould Mine...

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Transcript

•  What's up gold miners in today's episode. We welcome Lindsay Duguet to the podcast. Emergency Physician turned real estate investor syndicator and educator. Over The Last 5 Years. Lindsay and her husband have managed to scale their real estate portfolio to over 600 units and in this episode we go over exactly how she did it early on. In the episode we go over Lindsay's Journey from emergency position into real estate investing and what inspired her to make that pivot Lindsay and I also spend a lot of time talking about Physicians why so many Physicians aren't investing in real estate and why there's so many misconceptions and just overall lack of knowledge in the medical field and what Lindsay is doing and clover. Key Capital. Her real estate investment firm is doing to help break the cycle and help Physicians get educated on the powers of investing in real estate and finally in this episode we spent some time talking about the importance of mentorship and why Lindsay feels she wishes she had started with a mentor sooner and what you can do some strategies that you could deploy to find yourself a mentor. This a fantastic episode whether you are just starting out in your investing Journey whether you're a little bit further along in your investment journey and especially if you are a physician you need to tune into this episode so without further Ado everyone. Let's welcome to the show Lindsay du gay Lindsay welcome to the goldm than thanks for having me yeah no it honestly. This is uh this been a long time coming and someone who's just tuned into this episode right. Now Lindsay. They you know were like oh my gosh physician now real estate investor why should they stick around and listen like why should someone uh pay attention to this episode. Yeah good question honestly um. I'm still sometimes surprised that I'm doing these podcasts with real estate. If you asked me 10 years ago. When I was a medical student um I would have said yeah in 10 years. My goal I hope to be a full-time physician with a family real estate wasn't even something that I was considering and even five years ago. I had a pipe dream of having um investment income that would cover my salary um fast forward to now that actually has happened through real estate. But I wouldn't have thought that that actually would become a real re real dream that happen so medicine is very demanding. Medicine is changing um any. I think everybody should try to get other sources of income that they don't have to rely on treating their actual physical time for money because that's exactly what a job is right. You have to go to work to make a salary so things like real estate where you can actually get these investment. Uh streams are very important for everybody so stick around to find out how I did it all right sounds great well. You know it's interesting because I I don't know if you know this. But uh I went when I was undergrad. I was Premed and uh a lot of my friends ended up. Going you know the whole like the distance right. They went the whole way and what's interesting to me is that and and I don't know if you share this. This same like line of thought. But I feel like a lot of Physicians. They they become super book smart during like the 10 15 years that they're in school and everything. But you know the the last 10 years. I've learned a lot about real estate and finance and how the world Works how money works. But I feel like a lot of medical students because they're so engrossed in their in their studies that like you're you're kind of out in your mid-30s. Like early mid-30s you done with residency and and the financial literacy and the finan like a lot of a lot of medical students don't take the time to educate themselves financially because they're just so engrossed in the medical studies would you agree with that statement. Uh would you disagree with that statement. I'm really curious to hear what you have to say about that yeah. I 100% agree with that in medical school even in residency. We're not taught anything about financial education. We're just racking up the loans in medical school. I mean I came out with over $200,000 just in medical school debt um while you're working as a resident you're essentially making like minimum wage salary when you factor in the amount of hours that you're working um. We really did not have Financial educ other than hearing about the other Physicians investing in stocks like that. That's what we heard about. But it's not like we were taught. It's just like okay your doctor you hire a financial advisor. Then you give them money and then they just put your money into stocks and you hope that it grows right you invest in your 401 403s and everything like that that's a retirement you work you invest in stocks and that's it like there was nothing about real estate investing or any other type of investment at all. So what was that moment for you because clearly you didn't follow that P right when did you kind of break free. From that Matrix yeah. There wasn't one specific like Do or Die moment that was incredibly pivotable uh or anything like that. My husband actually was the one that read the book Rich Dad pornad which is the Gateway Book for a lot of people um and he said hey this kind of makes sense. Maybe we should look into possibly getting into real estate investment and I am definitely a person that if something clicks for me I will do everything in my power to get it done. So after I read it. I immediately signed up up for a three-day investment course and we just started taking action from that that day. Like as soon as we were done reading the book. We've been taking consistent action every single day for the last five years which is how we've been able to balloon our P portfolio in that amount of time we didn't get stuck in that analysis paralysis phase that a lot of people get stuck in well and and you know and again. This isn't like a rag on doctor's thing right. Like I I I have a lot of friends who are Physicians and and so anyone who's listening to this podcast like I I I have a tremendous amount of respect for people in the medical field that being said um. A lot of doctors are analytical by by Nature right. They're they're they're much the scientists right. Um I I was in a biochemical nanotechnology lab for like three years pipe pading stuff yeah 100%. So um so I'm I'm one of you uh basically um in that you know in that line of thought. But I'm curious you know. H how is it that you were able to kind of buck that Trend because I'm assuming that you also would probably consider yourself like at least quasi analytical and I feel like that's where a lot of you know maybe scientists uh. You know doctors that sort of like those those types of individuals get Engineers right. They get stuck in this like analysis paralysis pH how did you how did you overcome that like that's F the beginning maybe kind of the Stars Al line. We we had nothing to really lose at the beginning. It's not like. We had any big portfolio yet like again I had $200,000 of medic school debt. I was just starting my attending career at that time and the first houses that we bought we kind of picked them out because we wanted them to be practice properties. So we bought two single family homes for $2,500 each and we renovated them. So we're like okay. You know if we lose $55,000 plus some you know5 $10,000 that we put into each house. It's it's not going to hurt us significantly in the long term um and we did have a lot of issues with those if you listen to the other podcast that I've done. But we got through it and we were just too stupid uh or too determined to quit. I don't know. But in any case we kept going and we ended up making them work.
•  And it's it's been that Snowball Effect since then. That's awesome that's awesome. So I also want to say this because I have noticed a growing Trend like in in the last year maybe or two years. Maybe. It's just because I'm more aware of it. But I am seeing more uh specifically. Physicians kind of you know having these conversations about investing in real estate. Specifically. I think the stock market's always been. There. You know that that's been that's kind of like the old school way of doing things maybe not old school but like the the traditional way traditional yeah yeah. So what is it about what's like is there something that's going on right. Now that like maybe the the public isn't seeing right now in medical schools or just maybe amongst like the medical community. Like Instagram Facebook you like where where is this trend kind of like emerging from yeah. I don't think anything has to do with any social media. Trend it's really the the day-to-day grind medicine is changing and not just my specialty in emergency medicine. But I have friends in every medical specialty. You can imagine that's out there and we all feel the burn um you. We're being squeezed more and more for what we can give um. And it's getting more about documentation. And it's harder to get that FaceTime with the patients and most of us went into medicine. It sounds cliche but you want help people. You want to take care of people and there's a trend just nationally toward more. Uh the bureaucracy of it and dictation and charting um and it's it's a tough environment. Even just you know the the years that when I started in emergency medicine versus now it's like four times as hard to work in the shift as it used to be just because of the patient Acuity and the volume and everything to get by so it's. It's a tougher environment and doctors in general are feeling that and they want to have other areas of income that can either support themselves or that they can cut back so they're not full-time. I hear that time and time again. I have a lot of physician investors that have joined us in our real estate projects and they don't want to quit totally. They it. We've all worked so hard to get our medical degrees but right we want to do it on our own terms and maybe do it part-time or PRN. So you're not so burnt out in just the day-to-day I have to go to work. I have to get this W2 salary to pay everything that makes a lot of sense to me and by the way like I would say that exactly what you're describing right now is what I observed. When I was I was I interned at a uh general practitioner office back when I was like studying for my undergrad and everything which is back in like um 2011 or so I think is when I did that and even back then you know the majority of his day was spent on the phone talking to insurance companies and not not dealing with patients and so at some point I just kind of like sat down with him and I asked him. I said hey so like like what are you doing there all day and he's like I'm like fighting to like get paid basically right. And uh so um I know and that was like over a decade ago and if you're saying it's gotten way worse. Over the last four years. I can only imagine what the last decade and a half now really has done I hear that from a lot of Specialists I mean luckily. We don't have to deal with that in the emergency department because it's really you're coming in there's something emergent going on. We don't have to fight with the insurance companies but yeah for all my specialist colleagues or Family Medicine colleagues yeah. It's it's tough really tough yeah 100 perc well so you know just Switching gears a little bit because obviously like there's uh there's light at the end of the tunnel for you because you know Physicians still you know I I would say like to this. In this day. They still make good money right and so you're making good money. But if the money's not working for you then you're going to get stuck you know in this hamster wheel of uh you know having to work uh and you know living to work instead of uh working to live or whatever you know what I'm saying like I I I forget. It goes right but um so now you know that you have been doing. This like how has the how has your you know in investing Journey kind of like created freedom for you. I'm I'm curious how that like has has has it happened. Yet has it not happened yet. I'm really curious to he kind of like what what it looks like right. Now so on on paper. We are financially free our investments and our portfolio. It can pay the day-to-day of our basic bills. It's not paying for you know. Any first class trips to France or anything like that visit my husband's family but it it would pay the bills. However that being said we aren't doing that I'm still working full-time in fact. I've almost gone the opposite. Now. I'm the regional director of a couple hospitals in in our system in the emergency department. So I'm like half admin half still clinical seeing patients um so. I'm still full-time but we're using all that investment money and still money that we're saving from my W2 to buy more investment properties. So we're really just building that portfolio right. Now we not haven't cut back or anything like that. My husband jokes all the time because he does our real estate portfolio full time. He has real estate professional status. He's out working with the contractors right now at on an eight unit that we just bought two weeks ago. So he's in it every single day. But he jokes that he doesn't get a salary because like our company doesn't pay him. We just reinvest everything so he's always joking like I'm working for free yeah. That's funny well uh so that that actually kind of answers my question because I here I'm thinking is like how is Lindsay doing all of this right. Like she's you you know you're obviously working um ridiculous hours right and then you're also a full-time investor. So obviously it sounds like your husband is is an integral part of kind of like he much is yeah yeah. That's that's awesome so let's talk about the first deal right. You you said there was 25. It was like a like two single family homes. You said for 2500 de class neighborhood really poor condition poor neighborhood poor condition yeah to too many lessons for yeah. So what was that like kind of walk walk us through that uh that experience yeah we bought them site on scene um. After that three-day investment course. I started signing stuff for local Meetup meetups uh for free. So we met some other investors and this guy actually. His his wife worked at my hospital system too and he's like I've been doing this. For five years. I have 20 Doors and again five years ago. I'm like wow maybe in five years. I'll have 20 units like it sounded like something that maybe could be reachable um. So we ended up buying them from him cuz because they were just too far away and when we walked in there were squatters in the one house pipes were cut. There were like urine bottles. All over CU.
•  Electricity wasn't working or anything. Like that there were back taxes like we had done no due diligence on this whatever we just wanted to say we're investors we own investment properties. Now so um. We also found a local contractor we had no contract with him. We paid him cash up front. We did not see him again so a lot of lot lessons on these properties everything we we shouldn't have done. We did basically because we had no mentors we were trying to do everything ourselves. We weren't talking to other investors. We were just you know you don't know what you don't know so we kept them. We ended up rehabbing them um. We found another guy uh to help with the project we ended up doing full bur. You know the buy rehab rent refinance repeat um so we got our money back. They were infinite cash flow for the the couple years that we had owned them. We sold them we got a duplex. Then we did some Direct Mail campaigns got a 4unit um got some single families in nicer A-Class neighborhoods close to where we live here um very similar like got. Job. Renovations did refinances on all of those um and then when we got to 22 units we kind of reached our Max. We realized we were growing but not as fast as we wanted to so. We started looking at mentorships Mastermind programs and that's where we really started to leverage other people's time. Other people's knowledge we never considered investing out of state. We had never considered investing with Partners like a joint venture. Uh syndications like Capital raising that I do now like none of this was even a thought a couple years ago um until we surrounded ourselves with other people who are much more knowledgeable in the real estate uh world than we are and now we're doing all of the above and more that's awesome so and I think everyone who starts out investing in single families. I basically hear the same thing every single time right from everyone who's invested in single families and gone on to do. Bigger things is that they they realize at some point you know after like 10 20 30. That like wow this is. This is like doing it the hard way you know and we're not SC. It's not passive income not at all passive yeah and we're not scaling as quickly as we'd like to so um. Let's talk about the scale so the the first what was the first like larger deal that you did and and how did you and how did you put that deal together yeah so it wasn't so large but the first one that we did where it wasn't just Michael my husband and I was an 8un joint venture out of state in Indianapolis and we found uh that boots on the ground partner uh through the real estate group that we were in um. It's doing very very well. It was they called it a medium rehab compared to what we've done personally. It's. It's really a light rehab. So we renovated. Those apartments really just kind of paint changing the kitchens around a little bit. Uh we reached our Target rent so we're getting consistent now pretty passive income checks from that. Since it's just you know set and set in sale at this point with it fully rented um. We have done um a 17 Unit student housing with other partners that it's about 20 minutes away um. It's doing well. We had some issues with the boiler. The last couple months. My husband was there on Thanksgiving Day actually dealing with a burst pipe so again still some active but doing well with that. So we've done a bunch of JVS. There's a hotel that we have in h Fox Lake Illinois um that was. A huge gut job renovation project um really nice area and a Redevelopment part of the lake. So there's um summer is the busy time so we're getting into that busy time and then we we're doing the syndications too. So. The first I'd say uh big project that we did with Partners as GPS. On that team. Um was 110 unit portfolio in South Carolina and this was a lite property. So it's a lowincome housing tax credit um and that was the value ad here. It's in an area where it's it's more working class but there's not a lot of options for people to live in. So this government funded. Uh litech credit was coming to an end and we are now able and we have been for the last almost two years now going in renovating the units and then putting them at Market rent we were actually able to refy one of that portfolio part of the project um and it's doing very well so that was our first big syndication project that we completed that's awesome. So there's a there's actually a lot that I wanted to unpack from that. I'm curi yeah so I'm curious right. So you you made the the transition into syndicating proper properties and you're currently raising capital for that. You're putting together your um. You know your your Equity. Partners in there your LPS so what what is it that you're doing right now to um to bring LPS to the table. Like how are you raising capital is it primarily you know fellow Physicians like what does that look like yeah. It started accidentally really because um people were hearing at the hospital about me you know actually being now successful in these real estate projects. My husband calls it the unfair Advantage because a lot of people I work with. They are because they're Physicians accredited investors so it makes a little bit easy for some of the projects like 506c and even the 506b um to raise money from the people that I know um. We are doing more uh meetups that we're talking to people trying to put out the education pieces too because again a lot of Physicians were just not taught this you don't know it's a possibility you don't know. It's even out there to to do something like real estate investing so um. It started out with people that I know and work with very closely in the emergency department um. A lot of this has been Word of Mouth. Now they've had okay. This project was going well or reinvest or they brought in other colleagues that they know and we're starting you know forming these relationships with them and giving them the education pieces um. So it's it's kind of been a snowball effect in that way too. It's like okay like I actually am teaching and I actually are helping other people so now. I'm enjoying that even more so I didn't think I would be involved in the capital raising aspect and we don't do just that by any means like we're very active in all the management of the projects and everything going on too and my husband doing like Asset Management that kind of stuff and that makes a lot of sense right and that's actually something that I think a lot of um a lot of sponsors end up learning is that like you know with accredited investors specifically or like you kind of Target the the on the retail side of things like the the the um the individuals or the the the types of jobs that typically like you would expect them to be accredited. Investor like phans are clearly one of them um. What was I'm wondering like what was the the conversation. Like when you know you you talked to some of your physician friends and kind of explained like the depreciation benefits of these syndication deals yeah I mean that's huge for anybody. I mean taxes are everyone's biggest burden. You look at your gross salary and then what you're actually taking home net. It's like 40% is going right to taxes right so everybody wants to find the the loopholes. How do you decrease your your tax burden and everything um that'll be very transparent. I still do invest 100%. In my 401 403 457 I have 529s for my kids. All of those decrease my taxable income but yeah the depreciation for Real Estate is huge um and people like me who have a high income. W2 and my husband has the real estate professional tax status that helps even more for a lot of people and I have a lot of physici colleagues where yeah they have the high W2 and their spouses are now getting involved and active into their real estate. So it's it's like an extra loophole legal loophole to to take advantage of those depreciation benefits and you know fingers crossed about if the 100% bonus depreciation goes back into effect. But we've you know been educating people about that you know we're the 60% year right now but still it's still huge and it adds up the more projects that you do yeah. 100% I would agree that like getting that bonus depreciation back would be huge and yeah and and then yeah uh your spouse should get their real estate license or you know the equivalent like be involved in some in some capacity so I did not know so.
•  This is news to me that you were invested in a hotel and I don't know if you know this. But that's what I do so. I'm did not know that yeah yeah. So uh let's talk about that real quick because that's exciting so that's did you acquire that as a part of a portfolio or is this just like a one-off you're like go. This looks like a good opportunity. What does that look like this was a one-off um the boots on the ground partner that found this he does a lot of uh seller finance. Type deals which this is what it is um like like me. I like to send out letters and you know trying to negotiate off Market with people uh through Direct Mail campaign so he had found it through. Through that um there were raccoons in the ceilings. It was essentially being used as a squatter house too. So this thing was in very very poor shape. But the the value at he had the vision he lives there locally um and he had the the contractors in place and everything to turn it around. So uh we had trusted him through that uh to get it done and we the the biggest lesson from this property and I'll be very transparent. It was under capitalized through the JB Partners. At the beginning. Uh we didn't have the the whole JB component so it went slower than we wanted to at the beginning. So we could you know kind of do one part of the project at a time until we got the rest of the money and then uh continue to reinvest it. But yeah uh we bought that in October two almost two years ago it opened officially last June um so we have a brewery um restaurant tenant in the one bottom in the bottom part of the restaurant and then we have hostil stpe hotel rooms. It's called the randoff hotel.com. It's very nice now and then there's some like in the winter. It's it's not obviously the busy season. So during that time we convert the uh short-term rentals and the hotel units into midterm rentals. So they're month-to-month leases so we're still getting some you know pretty decent income throughout the winter months and now we're transitioning as of May first into the the true Hotel season where the money's made yeah that's awesome and I'm it sound this sounds like a boutique then not a branded hotel. It is yeah. It's very Boutique y that's awesome. How many rooms at 21 21 nice awesome and you said you said Montana am I making that up oh Fox Lake Illinois it's not too far from Chicago. Okay I was like how did I get Montana. That's crazy oh Montana. I'd like to have a ranch out there that would be cool yeah yeah 100% Fox Lake Illinois. That's cool I'll check it out. I'll check it out that's um that's really exciting so um any thoughts of doing more stuff in the hotel world or you kind of like oh that's nice but scking you to have the the it's really more of a business. I mean any real estate is a business. But it's really day-to-day operations which it's that was all new to us and Michael my husband's very very um into that and it's it's taking more time than we thought on a day-to-day uh to run that so yeah maybe if more systems would get in place but my my short answer is probably no yeah okay yeah no unless you get demand well and honestly like once you get into like the bigger. The Branded stuff right um hiring third party management is um is definitely a possibility. I think you know at for 21 units. It's it's hard to make the numbers work. First of all you can't even get a third party manager to be interested because just like it just doesn't make sense for them right so um and the scalability is not there. For this one yet yeah 100% we should talk offline but uh it's it's it's interesting that you are at least invested in in one hotel and that's how it starts right you invest in one then eventually yeah um so anyways in terms of your medical um career. Obviously you've learned a lot you've developed a lot of skills. I'm curious what skills that you developed during your your journey or that you have developed over your journey. Uh have you seen translate in positively into what all parts of real estate investing whether it's you know raising. Capital syndicating the deals you know just putting the deals together. Whatever it is like how has that impacted your real estate investing Journey yeah. That's a good question. I mean both professions. It's it's about people not just in different capacities. I mean in the Ed I'm taking care of sick patients in real estate um taking care of tenants and taking care of investors money. So there's you know. It's still a people business emergency medicine. It's really all about thinking on your feet. You're triaging sick versus not sick you're doing it in a high stress environment. Um. You know took 11 years to become an emergency medicine physician between College four years Medical School four years residency three years and I kind of figured if I can learn to be a doctor. I can learn how to do real estate too if I can learn how to buy and finance and manage a portfolio. You know it. We were able to do that um so real estate. It's more like triaging good versus bad deal instead of sick versus not sick patient and you know you do the paper underwriting just to see is this going to be worth my time to even dig through further and going through more due diligence. It's like in medicine you're ordering CAT scans and lab work and then you have to figure out that in real estate you're underwriting deals and seeing is the insurance going to go up. You know what what's the performa if I you know increase the rents x amount over this amount a year. So it's Analytical in just different ways. It's just a little less stressful in real estate because it's not real people's lives in the moment yeah 100% that makes that makes a lot of sense um and and honestly that's that's one thing that I really admire about Physicians. You know you when you really have to like be ridiculously committed right because you're dealing with people's lives and it's and like on a daily basis. So the the um just like the overall mental toll that I feel like that takes on like has to take on you right like I I can't imagine that it's that it's easy yeah. So I totally hear what you're saying about like having that like Exit Plan yeah right um and and having that like uh kind of like that safety. Net there so that you don't feel like the the added stress of like yeah. I gota do this right but rather do that's exactly that safety metet that's a great way to put it. And that's what I feel now like I can go and do the medical administrative and medical clinical because I know you know got excuse my. This really hits the fan I have that backup plan where I can you know go just fulltime into real estate. So it lets me enjoy it more and put more passion into medicine when I am there which is good and I mean it's all about t time management too. It's so crucial to balance everything this and giving yourself. Grace in it is crucial too different debate days de demand a different levels of my attention. Some days I'm 100% medical director administratively. Some days uh really just clinical physician. Some days I just need that mental break from that burden and a mom and wife only and some days. It's 100% real estate too. So uh it's it's a blend and looking ahead at the week and kind of time blocking. Yet being adaptable is really key for making all of this work yeah 100%. So I'm curious now that you now that you've kind of gone through several iterations and Evolutions in your investing Journey. What does the current investment.
•  Criteria look like for you. So we will consider any deal uh anywhere as long as the numbers make sense but more importantly who who's the team with um Michael and I we're not doing things just on our own anymore like even the eight unit that we bought two weeks ago. It's a very small JB. It's just four Partners. One is my brother uh who into it. Uh one is a very close friend who lives um not too far away who's also kind of boots on the ground. Who's helping us and then one is somebody who we know through our real estate networking in Florida. So I mean even with that. It's an eight unit but it sometimes you know some people count just numbers like oh I own 500 I own a thousand doors but they only own like 0.5%. Equity. You know they're getting like maybe $100 cash flow a month if that like that it sounds great and sexy on paper. But it's not really doing a whole lot for your portfolio. So like this eight unit this thing is set to be a killer right but oh it's only eight units. So some people would Overlook that but we're trying to you know always look at the big picture and who is going to be there on our team that can help us. And we can help them too and leverage it so that that's the main thing Partnerships who we're working with is one of the key things that we're we're looking at right. Now how does one and I I have a feeling. I know what you're going to say here. But I I'm curious right like how does one find good partner. Partners uh for these deals like where where have you found these Partners outside of your brother right like yeah yeah. He's he's stuck with me right. He's blood yeah um otherwise. It's networking um calls like this that then in lead into like a conversation next week. The next month and um we don't just jump into I mean you're forming a relationship right. It's like you're getting married to somebody and we've had better Partnerships than others throughout the years and that has all been like low growing and learning pains too um throughout that curve. So we want people who are ambitious. I mean a lot of people think I'm crazy which I am like I do a lot when I commit to something I do it and I have seen a lot of people not just Partners but potential partners that we didn't end up partnering with. For these reasons that the motivation isn't there um. Every deal is going to have problems right you can't. Nobody has a crystal ball. There's going to be things that come up you might find a spos here or something like that and then your your numbers are shot. For that month. Some people get very frustrated. They just want to bury their head the ground and not deal with it. That's not the partner that I want I want people that have grit and determination and uh figured out attitude so we're always looking for. It's a good book who not how like who is on our team that has different ideas and mindset but still the same same goal long term. So and this is just for my own personal like knowledge. Here when someone asks you to partner what you ask someone to partner with you are you right. Now are you you know focusing more on the the the equity side of things like the capital raising side of things or like the management side of things. Both I guess like how does H because it sounds like you guys kind of have everything in house already like you have do all the stuff. So I'm wondering when a partner would actually be necessary for you. If that makes sense so my husband and I have talked about that a lot because he really does the Hands-On management skills and it depends on the deal for us right. Now too. Like the the 17 Unit JB um. He he really is the boots on the ground he's managing it um getting tenants. In there we really have our leasing systems in place at this point which is good but for something. Like this we're under contract and we're going to close in a couple weeks on 144 unit. In uh Missouri. We are not the boots on the ground there our partners with sharp L Equity. They are they have their in-house vertically integrated property management company. There so we're not using our property management on that one. We're using our partners so different deals depend on different situations. Um. We're close getting under contract hopefully on a 16 unit which is right down the road from our primary home. Here that one probably can do everything I mean we can bring in the partners ourselves. We can manage it ourselves so we might not need a whole lot for that one. So it really it depends on the deal. The location um a lot of factors so kind of like chameleons. You know you need to see what what you need in which deal and to make it work that makes a lot of sense. I mean um especially if you're doing stuff out of state. You can partner up with someone that that is more you know boots on the ground right and then and with them like in Missouri. The sharp line are partners with that they have all the broker relationships already. They own like thousands of units in that area. So we are leveraging them to get onto their team in that location versus you know if they would come in on the 16 or something else. Like we are more knowledgeable in this area here in Pennsylvania than they are so. It's all about the right. Partners. It really is makes a lot of sense so let's talk about the market conditions right now because obviously things are a little a little up in the air and I'm curious what you are seeing. You know right now in the debt market like what is what has that done to your deals. Has it slowed you down Has. It sped you up are you the same. Curious what that looks like for you yeah no matter what markets like we're we're always looking at deals we're always underwriting because some sometimes you're going to have a lot more deal flow more deal flow. Then you have money for it to buy and then other times the deal flow is going to be down but you can still find the deals you can't just become complacent and say oh I'm going to wait another one or two years like you're letting a lot of opportunities to pass you by so yeah. I mean in 2023 last year deal flow was down in general. Obviously the interest rates were going up. A lot of deals were not penciling out um but yet especially in Pennsylvania. We there was still a lot of out ofate investors with cash like from New York who are still coming and buying up these properties. We essentially couldn't compete because they were buying them cash just to park their money. Meanwhile we're buying it to make sure like the cash on cash return is okay and what's the ir. What's the Em going to be and we couldn't compete with their numbers. Right. So yeah. We we missed a lot of deals but we also weren't just buying things to say we bought something like we're not GNA be dumb about spending our money and the other investors's money right now um. We're really starting to see a lot more of the stress sellers with Bridge debt coming due and um with the interest rates being high. The underwriting that somebody did a couple years ago. It's not working out for a refinance or a sale or a sale price that they thought that they were going to get so um. Like even 144 unit. We literally had to sign a paper with the sellers that we can't publicly say out loud what what we're buying it for because they're big institution and they don't want their reputation ruined but they got the same situation with this one. So it's it's happening. It's out there which it's good for us because we're getting better deals now and I mean going into Q2 of 2024. Uh we're pretty excited actually yeah. I would Echo that sentiment. I mean it's an exciting time to be a buyer for sure um. Not an exciting time to be an owner with a maturing loan. Yes exactly yes y very well said yeah yeah so question for you though because obviously you've been investing for some time um are any of your properties. Right now kind of like are you exp are you experiencing that on the owner side of things at all with any of with any of your loans and are and how are you overcoming that I mean thankfully no we are not um the only one that is a little stressful is actually that hotel one right now again because of the under capitalization from from the beginning. But that's just on you know a couple JB partners that we don't have any other investors money to worry about all the syndications that we've done and everything we are you know again M Wood thank God like everything is okay right now which is good. We we don't have any uh hard loans hard. Money loans coming due or Bridge debt or anything like that so yeah so question for you your first syndication right for someone that's like like oh my gosh like I want to like I've been investing for a little bit. I want to Syndicate but don't know like what to do um. H how did you do your first syndication like did you bring in someone that knew how to you know administer like fun. Administration like already had that experience you guys just kind of like okay. You did all right cool. Yes. We did we. We didn't. We didn't find a deal and just say okay. Let's try to make this work Michael who can we bring in uh. We were brought in as part of the team from other experienced people who had done multiple.
•  Other full cycle deals which is what I would recommend to anybody don't jump in and because you don't know what you don't know like you need to leverage other more experienced people's knowledge with a good track record um my personal advice yeah that makes that makes a lot of sense so you had mentioned something earlier that I wanted to touch back on now which is you. You talked about broker relationships before and I know that in previous uh podcasts that I've I've heard you on. You've also mentioned this like how has broker how have Broker relationships kind of like or how has like leveraging broke. Relationships helped you along in your investing journey and and what advice could you give someone uh. That's U that's starting out that wants to kind of grow that yeah having good broker relationships. It's it's invaluable. I mean we have bought everything um just through broker like pocket listings from people that haven't even hit like loopnet or the MLS. It's and it's from that track record and constantly reaching out to people and saying hey you know. We're here. We're still here. We're still looking for deals and also giving them feedback. There have been so many times broker sends us deals where the the ask price is just astronomical. So we underwrite it and we say okay your list prices or what you're saying a seller once is $20 million. We're at 14.5 and this is why because of this debt service and here and you know a bank won't accept these long terms so even if we're saying no we want to give feedback because it helps broker. It helps the seller and you also never know if you know deals falter all the time so say that 20 million seller ends up accepting eight and then they don't close and now they're closer to their Ino being due or something like that and now they are a distress seller and hey maybe they will reach back out to you on your 14.5 offer so giving good feedback to the Brokers is very huge. Too don't don't just ghost people or say oh yeah. It's too high. It's not worth it yeah yeah no and that makes sense right like you know. It's it's interesting because prior to getting an hotels. I was a broker as well um residential not commercial. But it. It's it's fascinating because like how you are treated as so this is something that like people don't understand right like most Brokers are really treated like you know there's like they're just you know uh. Oh. That's a broker right like they're not really given like a ton of respect. At least that's what I found and so it's interesting whenever someone hear. Someone say hey like you should really like nurture those relationships because it's true you know if you if you put if you try and like you know build a relationship with a broker. CH are you're going to get a lot of preferential treatment. In return you know might advate for more too. I mean if they know that you can close too. They can help push the seller you know maybe closer to your price point too. So you you want good relationships with them. Yep yeah so question for you. Uh when it comes to the next 24 36 months. There's still a lot of economic uncertainty. There's still a lot of you know obviously. This is an election year that sort of thing so what what's your outlook right now Lindsay on the next. Uh 24 36 months and how can investors um prepare themselves for what what's what's coming ahead. Obviously. You don't have pistol ball right but like to your the best of your knowledge take it out sh it yeah yeah yeah. I mean nothing there's not a lot changing in our strategy right. Now. I mean we're still like I said looking at deals. We're still optimistic um. We we might not buy and we're not rushing to buy deals too like if nothing is working out. We know that there will be more deals um. You don't want the fear of buying a deal now just to miss out on a better one to stop you. There's always going to be more deals. There's always going to be a reason why a deal isn't perfect either like there's no perfect deal out there. So we just want to continue to be consistent at looking at deals underwriting deals providing feedback and moving forward with any that hit our Target and making sure we're operating those well too you don't want to just keep buying to say you're buying and then forget about the deal that you just bought and you're not operating it correctly right. So that's a lot of the the strategy too you need to be paying very very close attention to the deals that you do have to making sure you're hitting your target returns for your investors as well or yourself. If it's a JB yeah and and how are you. How are you accounting for that in in your underwriting right. So like obviously we don't know where the debt Market's going I think everyone is assuming right now that it's going to go down uh. Over the next you know two years or so but can you really say for sure that that's going to happen so like how do you account for that in your underwriting. Do you have like a a best case worst case scenario uh system Str. Stress testing the underwriting and to be very transparent. My husband really is the underwriter. He is a mechanical engineer by background from France like he is the Excel guy that I say okay. I think this is gonna be okay and then he pulls up and says why this is wrong. Or.
•  This is right or you know you need to have another 5% buffer here and all that kind of stuff. So we like to have buffers in everything like okay. If we think that we can get 1,200 rent because of what we've had from this property down the street or something maybe we just put it at 1,00. Instead of pushing it you know to the Max um if especially on um pretty. Much everything we buy there's some type of value ad construction that we're doing so. If we think it's going to be $50,000. We're putting $75,000 in the underwriting right you know just as an example so there's buffers for every part of it. If we think that we can refy at 8.5% you know we're goingon to put n 99.5% something like that so there's if we miss the Target. On this part. Then we have buffers here and here so that's how we try to underwrite everything going forward with deals and that's why we get beat out by some people too. Because yeah maybe we are too conservative but we want to be respectful and protecting our money and everybody else's too yeah. The game changes when you have investors right then all of a sudden. It's y exactly it's not just your money anymore um. Obviously you've learned a lot of lessons uh in your real estate investing journey and I'm Cur you know and this has you know Made You All the Wiser. But if you had to look back on this journey of yours uh what would you say is is a pivotal mistake that you made that you learned a lot from like what what is maybe the biggest. Learning lesson that you've had in the last um you know how many years you've been investing now. Yeah I I mean think the biggest ones probably came from that first project just due due diligence even if it's a cheap deal um make sure you don't wave the inspections uh get inspections. Done always have contracts with everybody like I said that first contractor that we had that we had no contract don't pay people everything up front um most of the deals that we do now like I said they have some type of renovation and uh we actually have uh banks finance up to 100% of the construction projects was just grade and then they give it to our contractors and draw so you know nobody's getting everything up front. They're getting it as the project is progressing but that's another thing we talked about broker relationships. But Bank relationships are just as huge um so relationship building is huge. I think that we should have focused uh more on that at the beginning like I said we were getting these deals without talking to anybody. No mentor whatsoever we could have saved a lot of time. Mistakes and money had we been working with other people to help guide us um from the beginning. You know this is come up. This comes up in almost every podcast that I do is you know at some point in the conversation we talk about mentorship and we talk about you know the power of of great mentorship you've touched on it already but you know I'm. I'm genuinely curious like what mentorship you have like where did you find your. Mentor did you find them like online is this like a like a guru type of situation or like did you just like organically find them. I'm curious like what the path was for you to find this person. So the first hired Mentor we had it was through that three-day real estate investment course like way back you know five years ago and we ended up paying like $220,000 because we were sold in the moment to this Guru course and what a waste of money we got almost nothing. We got more from the three-day like $2,000 course than the $20,000 so that sucked like yeah. It wasn't worth it um the biggest one that we have gotten to benefit from it just over $9,000. It's make it happen Mastermind um and actually it's with sharp line too. So we've now partnered with them um and we're on their team actually as like employees now too um so that one was huge um. But there's other physician only ones that I'm part of that are just free uh that we just talk to each other. It's more of a accountability group. I'd say for other syndicating Physicians which is great so you don't have to pay a bunch of money to be in a mentorship. I mean there's plenty of people that I know even personally that they just like to you know they're in their 70s 80s. They've been very successful. They just like to talk and give back knowledge and nuggets and stuff so. But that again get out there and network. Too you don't have to pay somebody $20,000 to that you're wasting on something that you're not getting the value from so. It's I don't know kind inter interview your mentors and see who's a good fit for you because it's just like a physician relationship. A good doctor for one person is going to be a bad doctor for that. You know else. So. It's all about the relationships yeah you know and it's interesting that you say that because I I think that there's something to that right like not all mentors have to be paid and I one of one of my uh previous guests um Cody uh Davis. He has a you and Christian osot is his partner. They um they have like a really I don't know if you've ever met them or talked to them. No I yeah so they're well. They're out on the west coast. See um. They had this really interesting strategy. I I don't think they ever paid for mentorship but but basically what they did was. They just call every multi-unit like every apartment complex in the area um and they they don't P. They don't say hey I'm looking to buy. They say hey I admire like the portfolio that you've built. I'm getting started in real estate investing um could I buy you a cup of coffee. I'd love to learn more about how you did it right and so they start building these relationships with the sellers or with these owners right and then all of their deals have been seller financed and almost all of them have been like zero % down amazing yeah. They've built these relationships with Sellers and um I I just think that's brilliant because like you know obviously they're they're leveraging kind of like their youth and they can kind of put on like that inexperience like Oh. I'm a puppy kind of thing right and and help me and and but it's that's awesome but most humans they like to give back right like that's just the intrinsic nature. It's funny you say that because on this eight unit that we closed on I I mentioned there's four partners and one of them is a close friend. Now that who lives pretty close to us. Years ago he reached out to my husband that way he literally said hey I Googled like lour County Real Estate Investors your name came up can. I meet you for coffee and now this guy's on a JB deal with us like years later. So it's exactly how it worked that that's awesome yeah well it it yeah. It does work right like um yeah. That's um that's fascinating well Lindsay. We're coming up on time. Here I want to be respectful. You know before we before we uh finish up here.
•  I'm I'm curious. If if people want to you know either look into partnering with you investing with you uh where you know where can they find you obviously all the links um will be in the description below where can they find you yeah so our syndication website. It's clovery capital.com behind me up here um. We actually have a mentorship me and my partner Lauren. It's called mhi to the number2 millions.com. So that's the mentorship Clover key capital is the syndication and then I just put out content on Facebook lindsy duay on Facebook. It's do.do for Instagram um and I reach out to basically or I respond to anybody who reaches out to me too. I have a cly you can put just networking calls. I I love to talk about real estate literally. I'll just go on tangent and talk for minutes at a time. So that's awesome. Uh. That's awesome so well in traditional Gold Mine fashion here actually before we do this. I'm really curious right. What is the signific significance of clover key like what is what is that all the people I talk to and podcast. Nobody's ever asked that that's a good question so my husband's from France. So we have the floridae I love to find forlift clovers. I have thousands and thousands basically every time I go outside. I find a fourleaf clover so that's the fourleaf Clover in the middle and then the key is for Real Estate so yeah. That's awesome okay cool I I was just curious. I was like all right Clover key that it's it's. It's got a like good like catchy name. So I was like oh. That's that's a good one. I should ask we put a couple the French the clovers and the house key together. There we go I love it uh in traditional Gold Mine fashion Lindsay. We're going to have you leave the audience with one final gold nugget just start uh the compounding fact you. It is such a huge thing that we didn't realize until now we're in it you're going to wish. You started today a year from now if you don't start um the more that you you put consistent action steps whether it's calling a broker every day whether it's investing in one deal a year it will add up over time so just start and be consistent love. It I couldn't have said it better myself Lindsay thanks for stopping by thank you very much.