Whitney Sewell: This is your daily real estate syndication show. I'm your host, Whitney Sewell. Today, we've packed a number of shows together to give you some highlights. I know you're going to enjoy the show. Thank you for being with us today. Nick, welcome to the show. Honored to have you on.
Nick Elder: Great to be here, Whitney. Thanks for having me.
Whitney Sewell: Yeah, I know. Great to have you. I know you transitioned from a pretty high salary position right into this game of real estate, right? Why in the world would you do that? Right. So give us a little of that background and let's talk through that transition. Cause you did it and you did it successfully. And I know there's a number of things there that can help our listeners as well.
Nick Elder: Yeah, so Whitney, you know, just over a year ago, about a year and a couple of months, I was laid off from my pharmaceutical sales job. And for anybody that might be listening that's been in that career, layoffs are not an uncommon thing. It happens quite a bit. And you know, for being in a over six figure paying position, you could imagine it'd be pretty difficult to willingly leave a position like that to pursue something that's more uncertain. And so I think if I weren't forced into that situation, I'd always kind of had this fantasy and idea in my head that I'm going to just gracefully leave the world of pharmaceutical sales, transition seamlessly into a career of real estate, and I would not skip a beat as far as any income loss, et cetera, et cetera. And so it was definitely not as graceful of a transition, no doubt. But in my mindset, I knew that I had to get into real estate if I wanted to really pursue this as a career path, scale, and be as successful as I wanted to be. I was going to have to touch real estate every single day, nine to five, nine to eight, and focus solely on it. And so really it started with just a forceful transition.
Whitney Sewell: What a blessing to get booted out, right?
Nick Elder: That's, that's when I tell people all the time, you know, I've got friends in pharma and that, you know, they're just scrambling to get another pharma position. Right. But you know, I was, I was booted out forcefully and you know, I look back on it now and it's like, you know, I, I couldn't have asked for a better thing to happen.
Whitney Sewell: So was that a time of panic or did you already have a plan or what did that look like right there?
Nick Elder: You know, my one now business partner at Trinity Peak Partners, he was my boss at that company and we were sitting in the car together and we were always just talking like, we want to be in real estate. I don't want to be doing this right now. You know, so it was kind of like one of those things where my mindset had already shifted before it happened. You know, I knew I was probably going to at least quit in the next year. It just so happened that life had a plan for me to leave a year prior. And so I think I was just already in that mindset. And so the transition, like the day I got laid off, it was kind of like a breath of fresh air, despite the uncertainty that, you know, I knew was on the horizon.
Whitney Sewell: Nice. So what happened next? How did you get into the real estate business? What was the next few steps you took that were looking back, you know, now were crucial to being successful quickly?
Nick Elder: Yeah, so I kind of had already started investing in real estate in Denver. I was just house hacking, buying some single family properties. And so that was basically what I was doing in my prior W2 job career. I was focusing on that. So I was kind of getting my feet wet a little bit. I was learning about the world of multifamily, but I really didn't have the bandwidth to take the full leap into syndicating properties just because of my day job at the time. And so From there, I got forcefully laid off. I went and I said, I'm going to go become a commercial real estate broker. I know some people in the business, I thought I'd just kind of cut my teeth in the commercial real estate world. I knew some folks, I could maybe get into a brokerage and I'd learn the path of multifamily that way. So I went and got my broker's license. And about two months after being laid off, a connection of mine who reached out to me. This is a gentleman that I connected with about three years ago. He was a general partner at Ironton Capital, and he reached out to me and said, hey, we're swamped. We need help with on the investment relations side. We need help raising capital. Would you be interested? And so my entire plan went from, I'm going to be a commercial broker to, okay, I'm now going to get into the world of private equity and just start raising capital right away. That's what I really wanted to do. And when I say things happen for a reason, I think that's a testament to that saying. And so really I went from, I'm going to be a broker, learn that the world can work for real estate, to here's this opportunity to learn under mentors with a ton of experience. I can leverage their expertise, leverage their knowledge, and just learn as much as I can in a short period of time. And if I do that, I think in a year I'll be so much further ahead than I could have originally anticipated. And so that's what really led me into where I'm at right now.
Whitney Sewell: Yeah, that's awesome. Speak again to like, how did you, how were you connected to them to even know that, Hey, they reached out to Nick, they know Nick and they would even offer him a position to do this.
Nick Elder: Yeah, so this gentleman, three years ago, he's got the Denver Real Estate Investment Podcast, so he's pretty well known in the Colorado real estate market. He does a lot of education with investors. He produces a lot of content. He has got a very strong marketing background, and that was his role that he took on at Ironton Capital. I had connected with him three years ago. I wanted to have my portfolio analyzed, and just throughout that process, we kind of casually stayed connected. And then I had reached out to him again to see if, you know, he knew some folks from a brokerage standpoint, commercial real estate. I had reached out to him to potentially try and introduce me to some people. And he's like, this is when the market was turning a little bit. And he's like, you know, you don't want to do that. You know, just trust me, develop a business plan. But I think this is something that you really want to do because I know you're looking to get into the syndication world, into the private equity world. We have this opening. So it really just kind of was a three-year process of staying connected with this individual. And then here we are at year three, and just the right opportunity hit at the right time with him. I was the one that came to mind, you know, and so grateful for that. That's awesome.
Whitney Sewell: It speaks to being willing to step out there, meet people, right. And then stay in touch, right. You know, just those, those little touches with people, whether, whether it's actually having coffee together, whether it's phone calls sometimes, or just an email, whatever it may be. Staying top of mind benefited you in a big way, right. In that moment.
Nick Elder: Yeah, Whitney, you're spot on. You get it. You've been in this business for a while. Relationships are everything. I'm always open to a conversation with somebody, getting coffee with somebody. You never know who can connect who. You never know, you know, who they are and what they have. And so I'm just a big fan of like, put yourself out there, get uncomfortable, meet as many people as you can, because it could lead to something and you have to be open minded to that possibility.
Whitney Sewell: Yeah. So this group sounds like, you know, they, they pretty much became an instant mentor, right? Yeah. You know, in this space, you know, speaking, are you anybody else that were mentors, you know, in the past few years, you know, and just learning this business or any, anybody else like that, that, that have helped, that's helped you to get ahead faster? Or is it specifically within this group?
Nick Elder: Specifically within this group, you know, truth be told, I looked into doing one of those paid mentorship programs. I'm more of in of networking and finding a mentor, bringing value to that person and just it being more of an organic process versus a paid process. And so I hadn't zero mentorship really up until I joined this group. And I, you know, I think that's one of the, been one of the biggest contributors of my short-term success so far.
Whitney Sewell: Yeah. Yeah. It's incredible that, that it worked out for you like that. I, so we talk often, you know, on the show about mentors and finding mentors, you know, people don't want to go spend, you know, 25, 30, 50 and, you know, thousand and there's, you know, some mentors are even, you know, 75 to a hundred thousand, uh, in there's times it could be worth it. Right. Most can't afford that, that are trying to get into the business, but there are times that it's even worth it. My mentor, I think when I signed up years ago, it was like 12 and a half thousand. I joke about it often because even at the time, Hey, we didn't have 12 and a half thousand spend on mentorship. And we were like, wait a minute, you know, should we do this or we just lose our money? You know, looking back, you know, hit me, he's charging 75 to a hundred thousand now. And if I knew then what I know now, I couldn't have afforded it. But if I could have, I still, I would have paid for it. Right. Yeah. Yeah, absolutely. There's so much benefit there. However, I think a great way to do it is exactly what you did. I mean, I think I tell people all the time, find somebody that you want to be like 10 years from now, right? Exactly. Or it goes, get connected somehow and, you know, and work for them. I even tell, Hey, if you can afford to work for them for free, even part-time while you're at your W-2, like do it, you know, you're going to build connections and you're, you're making money by doing that. You know, like five years from now, you're making so much more money. You just can't see it right now. Right. And people say, Oh, I'm not going to work for a premium. I can't add any value to this person yet. You know? So, so anyway, I love how you did that, Nick, and you made that connection and now, man, it's, it's paying, you know, many times, right. To you, because you made that connection, you added value to this person. Speak to how you, how you added value to them, or maybe how you're adding value to them now.
Nick Elder: Yeah, I think raising the capital and just being the client facing or the investor facing person for the funds that we're running and launching. And I love what I do. I'm passionate about it. A lot of times it doesn't feel like work. I kind of like pinch myself just to say like, hey, I get to go play golf with investors. I get to go and just get coffee on a random Wednesday afternoon. It's something I truly enjoy. And I just think that I'm bringing a lot of value by being that person that is willing to just talk to investors all the time, educate investors, educate them on our funds, educate them on other things just in real estate. And just by being that person, I can take a lot of the work off of that person, that men's slate, so that he can continue to do. He sold two companies at this time. He started his third being Ironton Capital, and he has a lot of fun in life. He's skiing, he's running marathons, He deserves to, right? And for him to know that he can have somebody who can, you know, talk with investors, educate investors, you know, while he gets to continue to enjoy his life, I think it's a huge value that I have.
Whitney Sewell: Yeah, no doubt about it. Nick, how can the listeners get in touch with you and learn more about you?
Nick Elder: Yeah, so you can go to my LinkedIn page. You can just search Nick Elder and LinkedIn and you'll see me pop up. It's Nick Elder Real Estate. I really recommend people get in touch with me there. They can schedule a call with me. We can go through various different investment options or if you just want to connect and kind of just talk. That's something I'm open to as well. I always just like talking about the market, talking about life, talking about the opportunities that are out there. They don't have to be tied to any investment opportunity. If you're interested in a conversation, head there and let's chat.
Whitney Sewell: Chris, welcome to the show.
Chris Finlay: Thank you. Great to be on.
Whitney Sewell: Yeah, honored to meet you and have you on and just reading a little bit about you. I'm excited to dive in a little bit. I know the listeners want to know a little more about who you are, though. You know, give us a little a little bit about the 40 plus years in real estate. You know why? I guess a little bit of how, right? You get to where you're at now. Why real estate in the beginning? I know you didn't start there, which we talked about in your bio a little bit. I know you started as a pilot, but let's talk about that transition a little bit. But then, man, so much experience to go through.
Chris Finlay: Sure. Well, you know, I started out as a pilot for Eastern Airlines. And, you know, the great thing about that is that you in those days, you flew about two or three days a week. You know, three being the most. And so, you know, you either have a hobby or you get into some other, you know, other businesses on the side. And a lot of pilots do that. And so or investments on the side. So, um, you know, I, uh, I went to work for a company, got the opportunity to work for a commercial brokerage firm in Connecticut and, um, you know, got my feet wet on that and, and continued from there and then moved on up to, uh, New Hampshire and opened my own company in 1980. And, um, you know, started, started my own firm.
Whitney Sewell: So, so you were working, you said like three days a week as a pilot, but then you, you had this experience to be able to learn about, learn about this on the side, really?
Chris Finlay: Correct. Yeah, it was great. And then my father-in-law also was in the business and, uh, you know, I, I, um, I kept bugging him about how do I get in on some of his deals. So we finally, uh, you know, we, we, uh, it, it, He got me in on an avocado grove down in South Florida years ago. So turned out to be a great investment, so I was hooked.
Whitney Sewell: That's awesome. Wow. You opened your own firm in 1980. What was the focus then? What was your plan? Was it to grow a massive real estate firm? What was your thoughts then on what your business would become?
Chris Finlay: Yeah. I was in commercial brokerage down in Stanford, Connecticut. That's a big city and really suburb of New York City, really. And so what I wanted to do was sort of go to the next tier of the suburbs. So that market down there is very, very big and sophisticated. It would take a lot of capital to start a shop there. So I moved up to New Hampshire. And we opened our first office in Portsmouth, New Hampshire, which is, like I would say, 50, 60 miles north of Boston. And then in those days, back in 1980, in those smaller markets, there weren't commercial real estate brokerage firms that were exclusively commercial. It was usually a residential firm that would have one or two people doing commercial we were 100% commercial. So probably the first in New Hampshire to do that. And then we brought with it, you know, the sophistication and the data and all that stuff that, you know, the big city guys do. So, you know, we were trying to be the big frog in the small pond.
Whitney Sewell: Yeah. Wow. And how long, you know, were you as your own brokerage firm and then moving up to Floyd?
Chris Finlay: Yeah, we, well, we started out at brokerage, then we moved into appraisal and also property management. And, uh, in those days, the management was really all classes. Uh, you know, we were brokers in all classes. So, um, you know, we grew all three of them and, um, and, you know, that served us really well because late eighties, early nineties. we had the, you know, the great recession. I mean, it was the SNL crisis back then, all the banks were closed. We became one of the largest asset managers for the FDIC in the Northeast. And a big part of that was the fact that we had both, you know, a brokerage arm, a management arm and an appraisal arm. So those three sort of, you know, different categories really helped us, you know, in up and down markets and proved pretty good.
Whitney Sewell: Yeah, for sure. And then you made transition to Lloyd-Jones, right? And running Lloyd-Jones.
Chris Finlay: Well, we were the Finley company. So, you know, we were those three companies until about 1990. And then in 1990, we started developing multifamily, and primarily using the low-income housing tax credit. And that business really took off. We also started our own construction company as well, so we had both construction and development. And that was really sort of our focus, the development and construction of multifamily all the way through 2010. And that's when we moved into investing, primarily investing, not building because after the other recession, the 2008 crash, it really made sense to buy and not build, right? I mean, you could buy assets at a significant discount. And so we moved into the investment side and invested mainly on our own account. for several years, and then when we decided to bring in outside money, we didn't want the confusion of having that money with the Finley money, so we came up with the name Lloyd-Jones, which is my grandfather and great-grandfather, and we, you know, went as Lloyd-Jones.
Whitney Sewell: Love that. I love that name too, or how you came up with it. That's fun. So you said 2010 moved more into investing instead of building. It was the time to buy instead of building. But then you're buying multifamily, right? And sticking with multifamily. But then more recently you pivoted. Is that right?
Chris Finlay: Correct. Yeah. So we've been in multifamily since in the investment side of multifamily since 2010. And then in 21, we pretty much sold, I would say 80, 85% of our multifamily. Coming out of COVID, there was such a pent up demand and there was so much capital on the sidelines because obviously all the big funds and investment firms were, you know, pencils down all through COVID and nobody bought anything. So once that, you know, once everybody felt we're out of that, um, the market, as you well know, uh, went crazy and, uh, the numbers went crazy. And, uh, and so I saw that as an opportunity. I just felt that it was, you know, there were crazy numbers, right. When I was getting a three and a half cap for. you know, a B property in a small town in Florida, I said, you know, it's time to sell everything. So we tried to sell everything, but we got about 85% of it sold before it started trending down again. And, you know, and so we were pretty lucky on the exit side of that. Then what we've done since is with that capital, we've redeployed that into senior housing. And what happened with senior housing is you have a huge demographic wave of baby boomers coming at us, right? And so everybody knows the demand side. And let's face it, demographics is the key to real estate, right? So that segment of the population is just massive and going to increase. And we had been looking at it for, you know, four or five years in depth. I personally developed and own an assisted living and independent living up in New Hampshire. I've owned it for like 25 years. We developed one and I was all excited about it back then. and did very well. And I said, oh, wow, I'm going to do more of these. Then the market crashed. And so that segment of the business, the population is so thin that it was boom, bust, boom, bust. And just prior, so prior to COVID, we were looking at it again as a strategy. And especially since we sold the multifamily, we just felt, It was ideal and it was a little soft and a little overbuilt prior to COVID. And, um, and so we were, you know, put a team together and was really getting, getting into it and then boom COVID hit. And of course, you know, everything came to a screeching halt. And so when we got out of COVID back in, you know, say 21 into 21, 22, um, we really felt that there was a great time to buy. And tragically, every owner in senior living was clobbered by COVID. I mean, you could have been the best in the world or the worst in the world. Uniformly, you got decimated. I mean, it was just tragic what that did to that segment and industry. and not as badly as skilled nursing facilities. They were the absolute worst, of course. And then it trended down with memory care, assisted living, independent living. And so, you know, so when they came out of COVID, these companies were really, really in trouble. And, you know, last year we bought 12. This year we've got three, but I, you know, the market now is getting tough because of debt and equity is getting tougher and tougher. to make these things work. But it's still, it's still probably our focus. I mean, we, you know, we'll always be in multi, you know, multifamily is an excellent asset class. It's, you know, it's, it's without a doubt, the best probably. But right now we think that there's a unique opportunity in the senior space for those people that know how to run it. And that's the key to the, to the whole equation there is you've got to be able to manage these facilities. And that takes a big operating platform.
Whitney Sewell: No doubt about it. I appreciate just the color and the timeline, the picture that you paint. I think it's so helpful to think through, man, y'all's experience in multifamily. I would say, some would say, well, why wouldn't you just keep focusing on multifamily? Y'all done that for so long. You know that so well. Is it shiny object syndrome? How did you know to pivot away from this thing that you all have been laser focused on for so long?
Chris Finlay: Well, you know, if you look at 2010, to me, presented a unique opportunity to invest in multifamily, right? Before that, we were developers. And before that, investing in multi was good too. I mean, we built them and owned them and operated them. So in essence, we were investors as well. But 2010, because of the crash in 2008, the financial crash, There was, you know, here again, a sort of outside event created a tremendous opportunity to invest. It destroyed value, right? And it created, you know, a really outside return possibility by buying those assets at such a steep discount. So, you know, we pivoted there and said, okay, we're not developing. We shut down our development operation. and we bought existing assets. To me, this is 2010 for seniors. And, you know, instead of it being 2020, because of COVID, it's been delayed a couple of years, so call it 2022, but it's the same dynamics that happened in the multifamily space. You know, you had a financial crash here, you had a COVID crash And so that specific asset class was decimated. And now we're buying assets at 50 cents on the dollar. It's, it's unbelievable.
Whitney Sewell: Wow. What would, I guess, how do you know, like another, you know, tragedy, like you talked about, like a COVID, you know, won't come and happen again and decimate that asset class.
Chris Finlay: Sorry, what was that question again?
Whitney Sewell: You talked earlier about, you know, just the tragedy of COVID and what that did to the senior living, you know, asset classes, you know, and just, no matter who the operator was, how do you, I guess, prepare for a potential crisis like that again, you know, in that asset class?
Chris Finlay: That's a great question. I mean, you know, you hope like hell it never happens again, right? So, you know, certainly it's a, It's a higher risk class and it certainly sells at a cap rate that rewards that kind of risk, right? So it's far more operationally intensive than multifamily. My thought is that, you know, there's such a dynamic, you know, it's such a unique situation where you have such a massive population growth into that category and a market event that caused substantial discount. And you had the same sort of thing happen with the millennials back in 2010. So if you look at the millennial demographics, 2010, they shot up like a rocket, right? And then they wanted to get out of the basement, Ma's basement, and get into their own apartment. And so multifamily 2010 to 2020 was just you know, unprecedented growth, right? It's pretty hard to mess up. I think going forward, you're going to have, it's going to go back to a more normal, stabilized market. There's still going to be growth, but some markets may get easily overbuilt. And so it's going to be, you know, you're going to have to be much more careful in that space. Whereas I think with senior, we're going to just see a tremendous growth.
Whitney Sewell: Yeah, yeah, no, I appreciate that. I just I know that's a question listeners have. But yeah, it's interesting in the transition to to it's a you need more staff to run senior living facility, right? I mean, it is, you know, much more differently operated properties, I'm sure most of the listeners are aware of. You speak to that transition a little bit too, just the operation side of that kind of business, and undertaking that, moving to that asset class from multifamily.
Chris Finlay: Yeah, exactly. It's all about operations. So when you look at multi, I would say real estate is 90% of the equation and 10% is operating it well. And the operation side is pretty simple. It's not rocket science. When you look at senior housing, it's 90% operations and 10% real estate. So 100 unit property, you'd have 60, 70 employees, full time employees. Remember, you're 24 seven here. So you've got people around the clock. You know, you're providing medical care, you're providing food, housekeeping, the whole thing. I mean, it's just it's just a a significant operational platform that you have to create to be able to operate these. And so, you know, so when we started back in, you know, when we were looking at this business in 2020, we started acquiring some top talent in preparation for building out that operating platform. And then subsequent after COVID, what happened was there were a lot of companies that were in trouble. Uh, you know, several of them have shut down. And so the, the opportunity that presented me with me was now I can, I can get out there and attract and recruit top talent because it's available. You know, just because of what they've gone through, air game COVID and the, you know, the disruption and distress that that caused, uh, put a lot of top talent out there available. to a startup like us. And so we were able to put together a tremendous team and be able to execute on that strategy.
Whitney Sewell: Love that. Chris, thank you so much for your time today. How can the listeners get in touch with you and learn more about you?
Chris Finlay: Yeah, well, LinkedIn, Chris Finley on LinkedIn at Lloyd Jones or LloydJonesLLC.com.
Whitney Sewell: Thank you for being with us again today. I hope that you have learned a lot from the show. Don't forget to like and subscribe. I hope you're telling your friends about the Real Estate Syndication Show and how they can also build wealth in real estate. You can also go to lifebridgecapital.com and start investing today.