The Long Game

I love this thought of playing "the long game." It is really my philosophy on life, business and relationships in general. If you do things the right way, add enough real value, treat people right, take ownership of your failures and mistakes, things are going to work out in the long run.

Whenever I am working with a new or existing client, I make it a point to communicate that I am interested in a long-term business and personal relationship. I don't see a new client as one quick deal or paycheck, as many brokers and agents do (or business people in general). I see my clients as people who I am committed to plugging in the necessary pieces towards creating success in their real estate investments - focused on their unique goals. When I commit to serving them as an advisor, negotiator, consultant and closer for my clients, I am thinking forward about 30+ years of results oriented achievements that will set my clients up to live the life they are aspiring to live. Any astute business person knows that existing customers are less expensive, require less time & effort to acquire than new customers. The intelligent business person also knows that creating genuine transactions in the best interest of the customer creates lasting loyalty and referrals are a natural result. Further, this smart approach creates the biggest growth opportunities for any business. When I come across a deal that does not fit my clients objectives, I will gladly advise them to pass. My mantra is "no deal is better than a bad deal." I want my clients coming back to me eager to reach for more after the success they have already had in deals that made the right kind of sense. With all of this in mind, it is astounding at the level of deception and short sighted business practices that I observe on a daily basis. To many, the one sale achieved through trickery or cutting corners creates today's financial gain and closes the door on any future opportunities that could be ten-fold. News flash - people eventually realize when they've been taken advantage of.

As a real estate investor, the long game mentality is absolutely essential for success. Investing in real estate is not at all a "get rich quick" scheme. Anyone who has achieved outstanding results in building a real estate portfolio will tell you it takes many years, countless failures, a thriving and dynamic network, credibility, investments additional to monetary in time/energy/talent/knowledge, and massive action. There are going to be times along the journey that your asset values decrease due to market conditions. There will be times where you have setbacks due to management, tenants, political conditions, and many other factors. However, I believe if you have the long game in mind, and realize big picture where these challenges are taking you, it makes it all worth it. The level of wealth you can achieve through real estate, and most importantly the impact you can have on the world, is nothing short of astounding. However, it does not happen overnight. Ask any person who's built a substantial and lasting business and they will tell you their "overnight success" story was about 20 years in the making before it took off. 

If you are setting out to do something substantial through real estate or any other business, I implore you to take the long-game approach. The world is so transparent these days that if you take a different approach, you may succeed in the short run, but you will eventually be exposed. If you are looking to impact others, think about how you can add significant value to them first before you think of what a payoff to you could be. Be generous in your time, talents and attention. We all have special talents and callings in this life. Use yours genuinely and intentional to create excellent results and chances are the right things will happen to you and your family in the long run. Go the extra mile and do it the right way with the long game in mind.

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90 Days to Thanksgiving

It recently dawned upon me that we are about 90 days out from Thanksgiving. If you're like me that fact makes you double check your calendar and try to figure out where the hell this year has gone. I frequently like to stay on top of how quick time passes, because it gives me an opportunity to check myself and make sure I am staying on top of my short term and long term goals. Every day we need to be checking ourselves to make sure we are disciplined in doing the small things to reach our big goals. This helps us become the person we need to become to expand into the big future we expect for ourselves. In the mean time, we need to be grateful for all that we do have, which is what I would like to discuss today.

I was discussing with some friends last night the feeling of tension I've noticed that I constantly have. The tension is rooted in the fact that I know I could always improve in some way, whether that is through an improved process, increased knowledge, or improved action. Some days this tension eats at me and causes me to stress myself out. Over time, I have come to understand that achievement starts with this tension and I embrace that feeling that constantly exists. Never being complacent allows me to find and capitalize on opportunities for my clients, which is my number one goal in business. Further, tension gives me the opportunity to have a desire and take action for a better future in general - whether that is an improved client experience, enhanced real estate assets through renovation, improved negotiation techniques, or more laser focus on vendor relationships and financial modeling. The list could go on and on.

While tension is a very important driver for me, I realize the only way to enjoy the journey and life is to be grateful for all I have an all I have accomplished. I am grateful for the opportunities my clients give me to serve them. I am grateful for my colleagues for the assistance and expertise they provide to me on numerous deals and projects. I am grateful for friends and family that give me the opportunity to enjoy life and build memorable experiences. I am grateful for simple things like a roof over my head, shoes on my feet and to live in a free country. While I have plenty of tension and things I want to accomplish ahead of me, I am reminded 90 days away from Thanksgiving 2017 how many things I have worked so hard for that are already in my life. I challenge you to think of one thing each day until Thanksgiving that you are also thankful for. The attitude this practice could create could make all the difference for you too!

 

In a perfect world...

In a perfect world, what we present about ourselves, our family, our business and professional lives on social media and other places online would be an accurate match of our reality. Many times people pretend that by living this perfect life that somehow it will actually come true. But guess what - we live in a flawed world! We are flawed people. Picture perfect is rarely what our lives are, so who are we kidding? The purpose of today's message is to challenge you to be authentic and face the reality of your failures. At the time I am saying this, I am challenging myself to do the same. I believe this small act can have a significant impact on our hyper-connected world.

I'll just speak for myself, offer some vulnerability and openly admit that I fail every day in some way. Some mistakes are more costly and detrimental than others, of course. I'll share some examples. I have times where I don't deliver the results my clients are expecting, because of many different reasons. Separately, I have personally invested in deal or opportunities that have had rough patches that could have been avoided. I have lost out on opportunities because of laziness, lack of preparedness, or lack of hustle. There have been big and small goals that I don't attain because of a lack of grit, focus, dedication or for a whole host of other reasons. I have failed in many relationships with a lack of understanding, care, perspective or appreciation. Sometimes I fail simply because I don't have the practical knowledge to put together the pieces that are needed to succeed. The moral of the story is, I fail quite frequently in many ways.

Over the past year (and throughout my life) I've had countless failures. The more things I have attempted to achieve, however, the number and intensity of those failures have sharply increased. What these failures have caused me to do is to take an inventory of the things that I must improve on - whether it is pure lack of specialized knowledge, absence of drive or persistence. I am on a road that I hope ends up in success, but I continuously encounter downs and ups, ups and downs. I've been told those that attain success have failed much more than those who don't.

What I have learned is this journey is not anywhere close to a straight and narrow path. This has caused me to realize that in the long run the failures are what will really make me who I intentionally want to become. Failures I have experienced result in a "sting" and impact me deeply to a point where I have no choice but to change directions. What these lessons have taught me is that I must improve and eventually make me realize they are blessings in disguise. I must seek and offer mutual value to mentors for specific purposes. I must voraciously read books on strategies, mindsets, philosophies, and various improvement topics to arm myself with the appropriate knowledge to avoid making the same mistakes twice. As I apply different practices to my learning to help reduce the chance for future failure, I must remind myself that future failures are irrelevant but the goal is to eliminate one failure from reoccurring. Failure in itself is no fun, but the resulted growth experienced from the pressure it creates is beautiful. 

I challenge you to be transparent and do not have fear for the inevitable failures that await you on your own path. Whether you're investing in income producing real estate, building a business or a family, or growing in your career - the failures will be inevitable. Focus on correcting those mistakes through intentional action and you will be lightyears ahead of those who never even tried. While you're at it, don't be afraid to be yourself along the way!

 

Peaks and Valleys

In this blog, I typically write about a combination of my perspectives on life, relationships, success, the real estate business and current events. These are typically the over-arching topics on my mind, so its been a great avenue to share with the world. Today, I want to talk about a hobby that I have been enjoying this summer that has parallels to all of these topics I usually ponder. I just returned from a great mini-vacation to the great state of Colorado, where I was blessed to enjoy many experiences in Denver and in Breckinridge up in the Rocky Mountains. Of course I took care of some business on this trip, but it was the visceral experience I had hiking in the mountains that I believe is worth sharing. 

To give some context, I fell in love with hiking when I lived in Maui, Hawaii seven years ago. Before this period of my life, I never really gave this activity a second thought, let alone put it into practice. To me, hiking sounded like glorified walking, and there were many other things I could spend my time doing that would be more productive or satisfying. However, it was implored by Hawaiian locals and experts that the beauty of the islands could not be fully experienced without exploring them on foot. I took the heed of this advice and strapped on some shoes and packed a camel back full of water, trail mix, and sunscreen. I figured, at the least, I would be able to capture some incredible views that would otherwise be unavailable. After all, I was an island dude now with nothing but time on my hands. 

Atop Haleakala Crater in Summer 2010

Atop Haleakala Crater in Summer 2010

What I didn't expect was to gain experiences that were so applicable and teachable to the rest of my life. When you set off for a hike, especially in unfamiliar terrain, you rarely completely know what to expect - it is the beginning of an adventure. Perhaps you've researched the length of the hike or the time expected on a certain trail, but you don't fully know the level of difficulty or the obstacles that will be in your way. It is also impossible to know what parts of the hike will be challenging and which parts will give you a moment of recovery. Which moments are uphill, and which are downhill - it is all a mystery in the beginning. 

The only way to discover these things in hiking, as in life/business/real estate, is to face them head on and take action. You must be prepared to battle the challenges and the ups and the downs with persistence and fortitude. You must have reserves to replenish your expended energy and a contingency plan for when things go as unexpected. It is essential to be prepared to innovate, improvise, and look for various solutions to many potential scenarios. When the altitude is high and the oxygen levels are low, as it was in Breckinridge this weekend, you must be ready to power through that challenge and keep your eyes on the prize. When the incline steepens, you must be ready to push forward through painful times and be focused on the end result. When the trail provides some relief, take full advantage. 

Life, business, relationships and real estate investments all have peaks and valleys. We must take the lessons provided from an experience like hiking to know that we can and will reach the desired destination. No matter what comes our way on the path, it is so important to remember that we have what it takes to overcome. No matter how difficult the trail may become, enjoy the view and remain focused on your ultimate goal. 

Herman Gulch Trail Breckenridge, CO in Summer 2017

Herman Gulch Trail Breckenridge, CO in Summer 2017

 

 

 

 

Global Pressure, Local Compression

You've seen it on the news, read about it in various media and social media outlets, observed its merits debated in political arenas. Whether or not you realize it, we live a life heavily impacted by globalization. Whether you believe it is positive, negative or neutral, you must recognize it as reality.

No, this is not "fake news," it is the reality of our modern world. You may be reading my blog clear on the other side of the world on your computer, your iPad, iPhone or Android. Maybe you're in a coffee shop in San Francisco, at the mall in Dubai, in your office in Indianapolis or perhaps you're walking your dog on Bardstown Road in the Highlands. There's a good chance you recently purchased something on this very same device and received it within 24 hours at your front door. Yes, you probably tapped your thumb once or twice on the app that's putting retail conglomerates out of commission left and right and who now has a larger market cap than the one time king Wal-Mart (do I even need to mention the company name?). This same device just facilitated a ride to your next appointment, across town or to the airport cheaper and faster than you would've ever imagined just a couple years ago.

You get the gist. What it boils down to is that exponential technological advances have created a global economy that cannot be ignored. Real estate is experiencing the shift of these forces as well. Of course, retail and industrial real estate are changing drastically before our eyes. Successful retail owners and operators appear to be adapting to these forces by creating more experiential based services, rather than commodity products. Industrial real estate has become distribution centric for e-commerce outlets. Office spaces are becoming more shared-oriented or redeveloped into mixed or different uses since employment is being redefined. We're scratching surfaces only here, but I think you're following. 

In the real estate investment world, global players are accessing local data and making many diverse acquisition or disposition decisions in markets where they otherwise could not in previous years. Tools and technologies make it easier to access demographics/psychographics/traffic/financial information, select sites, communicate and sign documents from anywhere in the world. Of course, the gateway and primary markets receive the bulk of the global attention, due to many factors. As you may imagine, this creates a domino effect to secondary and tertiary markets. With the laws supply and demand, investors looking for yield tend to look in markets where it exists. Local players in turn become national players. Other local players must become either hyperlocal or cease to exist. Whatever the individual strategy, these factors can create higher demand, which in turn creates lower cap rates and higher prices everywhere. We're certainly seeing this impact on my local market.

When will this reach a tipping point? That is the million dollar question. In the mean time, I suggest you continue to stay grounded in the fundamentals of evaluating your opportunities. Take advantage of the resources technology provides to scale your business. Focus on your goals and leverage the global economy to help you live the life you want to live. Align yourself with partners who understand and can help you capitalize on this new world. Don't allow the hysteria of these changes cause you to act against your investing principles. Think big, double your effort, and put your plan into action today.

Standing In My Clients' Shoes

In a career such as real estate brokerage, it is essential to serve the clients' best interest at all times. This is so important in an industry that is built on service, trust and relationships. Many times, brokers and agents are presented with opportunities to cut corners and to do things the easy way and potentially still reap nearly the full reward. Personally, I strive to live by the philosophy of the golden rule - "do unto others as you would have them do unto you." In my opinion, this should be the same in business and personal relationships.

One way I am able to operate within this approach is to ask myself the following: if I was the buyer/investor, seller/exchangor, landlord or tenant, what would my expectations be? For example, if I am the owner of an apartment building or other commercial property for sale, I expect my broker to exhaust all marketing avenues to create the highest possible demand, creatively and strategically. I would expect my broker to provide research and background in detail as to why we are offering a certain pricing strategy, and why that is in my best interest. Further, I would expect my broker to negotiate with passion, to communicate with precision, follow up with persistence, and tirelessly overcome objections to ultimately achieve a beneficial sale according to my goals. If I am an investor working with a broker to locate a new retail strip center opportunity for acquisition, I would expect peak performance as well. Since this would be such an important piece of my investment strategy, I would expect my broker to analyze opportunities with precise detail, inquire deeply to learn all the hidden information, and effectively negotiate with passion and principle.

These examples illustrate the dire need to have responsibility for the actions we, as practitioners, must embody to enjoy a long and fruitful career. Treat your client like you would treat yourself. If the deal was your own, would your effort match that of what you are providing to your clients? I strive to always answer this question with a resounding yes. Not only because it is the right thing to do, but in so doing, current clients become clients for life.

Analysis Paralysis

To be successful in real estate investing, you must effectively analyze the cash flow and cost projections of that potential new project. It is essential to understand the potential pitfalls and possible upside that would cause you to have interest in investing your valuable time and treasure. Without this practice, you can never understand what opportunities are worth pursuing. However, be aware of the hole could potentially find yourself falling into when drowning in numbers, spreadsheets and considering all the different scenarios. This creates "paralysis by analysis."

It is similar to shopping for a new car or a new television (except for the minor detail that we are talking assets, not liabilities). You are taking into account at the different property features - how many units, how many vacancies and occupied, market & current rent, square footage, mechanical ages, roof condition, crime, demand, lease terms, utilities paid by owner and tenant, maintenance actuals and projections, lawn care, asking price vs comparable sales, cap rates, cash on cash projected return and more! The list can get quite long and your brain can get tied in a knot if you're not careful.

My suggestion is to think through your strategy and focus on the benefits sought to achieve your purpose through real estate investing. Know your competition. Know your seller and the results they seek either through profit, problem solving or exchange. Know your numbers but don't get married to them so much you miss the opportunity that sits in front of you. Historical numbers may be fairly representative of the future but will not always hold. Focus on how your ownership will improve those figures. Control the controllable. Get in the game. Over-analyzing could get you in a position where you never make a move! Don't let it happen to you. 

Penny Wise and Dollar Foolish

In my real estate practice I sometimes I feel that I have seen it all. I exclusively represent real estate investors in the sale of income producing assets - whether that is apartment complexes, retail properties, mixed use properties, strip centers, industrial warehouses, or sometimes even a package of rental houses. The value in these type of assets always are evaluated by the income they produce and the present value of the future income they will produce. 

To acquire income producing properties, investors need either cash or access to various forms of financing. Cash is obviously straightforward, however financing requires the investor to show proof of income, other debt, and a story of why they are a viable candidate to receive a loan. There are times when business owners decide they want to pay less than what is required to Uncle Sam - who wouldn't prefer to pay less in tax, after all. In this scenario, the business owner reports a lower than actual net income, which thereby reduces their tax burden. This is certainly an illegal and unethical practice and it can come back to haunt prospective investors when it comes time to obtain financing (and perhaps in court as well!). Yes, they saved some tax dollars, stock piled some cash, but missed out on the ability to obtain leverage because now the lending source cannot legitimately underwrite them as someone who can generate income. The missed opportunity to obtain leverage is substantial as it is an extremely valuable tool in building wealth through real estate. Leverage gives borrowers the ability to increase the return on each of their dollars in the investment. Because of being "penny wise" with respect to saving those tax dollars, these folks suddenly realize they have been "dollar foolish" now with the vanishing ability to obtain financing. Say goodbye to that new passive income stream.

Alternatively, to dispose of income producing assets, a seller must prove the cash flow in the form of legally binding leases, IRS tax returns, and physical inspections. In the same way that was mentioned above, if the property seller does not properly report earnings to the IRS and pay the required tax bill, the value of that asset decreases exponentially. This is penny wise (maybe not so wise, really) and certainly dollar foolish. If the seller has cut corners on repairs and maintenance or other capital expenditures, they are shooting themselves in the foot at the time of sale. A buyer will penalize a seller for not properly completed repairs and the full market value may not be realized as a result in that sale. Another prime example of saving a few bucks on the front end but losing substantially more on the back end.

To be successful in real estate investing, it is imperative that you become wise with the big ticket components that have the most effect. Of course you want to pay special attention to the details, and at the same time avoid engaging in activities such as these that will come back to bite you in the end. 

Let's discuss your investment program today so you can ensure you are making the best possible decisions. Give me a call at 502-648-9523 or connect with me on Twitter at @trches01. (By the way, ANYONE can be a real estate investor, not just the rich and famous. In fact, feel comfortable discussing with me how you can become a real estate investor; it's not as outlandish as it may sound.)

How to Negotiate in the Real World

I hope you have had a successful and satisfying second week of the year filled with achievements, challenges overcome and most importantly good times! This 2017 is already kicked in full-speed ahead and it is a good checkpoint to make sure you are sticking with your new years' resolutions and focused on what progress you plan to make this year. If not, take this as a friendly accountability reminder. On to the meat and potatoes, I think you will find value in today's blog. This topic overlaps every segment of our society - it is the notion of whether or not people make decisions based on logic or emotion. SHOCKER: most people make decisions based subconsciously on emotion and a hierarchy of needs - read: politics, consumer behavior, etc. 

I am currently reading a fascinating book called "Never Split the Difference: Negotiating As If Your Life Depended On It" by Chris Voss. The author is a former FBI high-stakes negotiator with experience negotiating some of the most intense hostage situations you can ever imagine. He talks about times negotiating with terrorists holding American hostages and some examples of intense bank robberies in NYC where he negotiated directly with the criminals to save lives and bring the criminals to justice. Those stakes, with literally lives depending on the successful outcome, were much higher than business negotiations or certainly negotiations that we engage in every day in our personal lives. However, the principals should be applied to our every day dealings in business and life. 

Many students of negotiation may recall the world-renowned Harvard Negotiation Project's findings in the publication "Getting to Yes." I certainly have been a proponent and have applied these principals to my business for a long period of time. Without delving into each and every detail, the findings essentially encourage negotiators to focus on the content of the negotiation and to separate facts from emotion to achieve shared goals between counterparts. The premise of Chris Voss' argument, to the contrary, is that people act on emotion above all else. We can prepare the most impressive logical argument, structure the most comprehensive presentation on what the facts of the deal are and how potential solutions affect all parties, but if we are not paying attention to how emotionally (perhaps subconsciously) the negotiation is perceived by our counterpart, we will lose.

There are countless techniques for giving counterparts the emotional control they seek to achieve the sometime elusive and ultimate agreement. In the interest of brevity, the satisfaction of needs goes back to the theory of "Maslow's Hierarchy of Needs," which you may have studied at some point in your college psychology class. It is most important to consider how a certain negotiation and the potential outcome relates to the other party's hierarchy of needs, even in a high-impact business negotiation or a low-stakes back and forth with your children, other family members or even the clerk at your local supermarket. 

Next time you are entering into a negotiation, keep in mind that your adversary has various needs to satisfy which are essential to gain solid footing. Negotiation can be very uncertain, but if you would like to discuss further how my understanding of this complex topic can benefit your real estate investments, please don't hesitate to reach out. If you find value in my blog, please share with your friends and colleagues.

Distinguished Due Diligence

When you were growing up in school, you likely dreaded the thought of homework. You may likely have even despised the thought of doing further work outside of what was required during your school day. I know I certainly was not a fan. Fortunately, the real world does not distribute homework to you to further your professional learning. On the other hand, to be successful in most endeavors, it is wise to voluntarily do the homework to become fully aware and to give you the information necessary to act upon all the necessary components of the undertaking. Otherwise, there could be big trouble in overlooking these details.

In an investment real estate acquisition, most purchase agreements will be "as-is". This essentially means the seller is not warranting anything with regard to the real estate itself. It is up to the buyer to determine whether or not that "as-is" condition is satisfactory. After all, the buyer is going to have to deal with all the various issues that come with being the new property owner.

This is where due diligence comes in. When my clients enter into a purchase agreement to purchase cash-flowing investment real estate we have several steps to take to ensure our homework, or due-diligence, is sufficient and successful. First, we need to verify all leases associated with the property are sufficient and match the original communications reported from the seller. Then we need to match up the lease income to our pro-forma projections and the prior year or years financials reported to the IRS. Review utilities in depth, identify opportunities or challenges and obtain a list of any recent capital expenditures. Once these have been gathered and documented, it is time to physically inspect the condition of the property with qualified and professional contractors. We lean on these vendors to assist in estimating necessary improvements and utilize these figures to ensure our projections remain feasible for the expected life of the investment. During this time our financing needs to be underway where we are searching and securing the appropriate financing for the project. Further, we must seek environmental evaluations for qualifying properties and appraisals for leveraged undertakings. Negotiations, personnel placement and timeline planning continue during this process as well. Once we complete these steps we can move into coordinating with closing attorneys and title companies to ensure we are delivering a clear title from seller to buyer. 

You still with me? You worn out yet? Make sure every "i" is dotted and every "t" is crossed because missing one or two of these due diligence steps could be very costly. Each piece of this puzzle needs follow up and needs to be completed in a timely manner, with skill. This is a big part of why my clients hire, refer and do repeat business with me - it is very valuable to be hyper-focused on this piece of the transaction. Do your homework in real estate before you close and your investments will be sure to become distinguished.

Let me take a moment to wish you a Happy New Year! Looking back at 2016 I can say it was the best year yet in my business and life. A lot of hard work, challenges, learning experiences, and winning celebrations encompassed 2016. I look forward to more goals achieved, memories made and milestones crossed in 2017. As always, if there's anything I can offer to you in your business or personally, don't hesitate to reach out to me. You know I am here to be your advisor on wealth building through real estate, but I am also always happy to help in any way possible. 

 

Time for Reflection

It is nothing short of incredible how fast the year 2016 has flown by. It seems like just yesterday we were setting goals, new years' resolutions and establishing plans for how this year would go professionally and personally. Next thing we know, it is December, and time to reflect on how we performed. Time to take an inventory of the successes and shortcomings of this year and project forward how the coming years will look. Another year presents an opportunity for further improvement. Whether that is how we treat others, how dedicated we are to our health/profession/religion, new systems to implement in our business, new commitments to further our education - whatever the case may be -  the end of the year is usually a great time to have a deep look in the mirror. It is a time to embrace new changes.

I have always been a highly goal-oriented person. There's just something about envisioning a future that doesn't currently exist and actually achieving that end that is absolutely exhilarating. Putting in place a framework to overcome challenges, to adapt, and to achieve is what life is all about. To me, the month of December is a rewarding time to live with the satisfaction of the challenges that have been overcome in the prior year. There is nothing more satisfying to me than reflecting upon the tough times and how in previous years I strived to be where I am today.   

I am greatly thankful for the opportunities that have been presented to me through working with my clients this year. The amount of growth I have experienced in 2016 by working through complex real estate transactions has been nothing short of incredible. I have learned that my clients are some of the toughest, smartest, and most results oriented people I have ever had the privilege of working with. They have challenged me to become a better advisor and person. I am overwhelmingly thankful for their continued loyalty and further introductions which have been critical to my business growth. I am thankful for the opportunity to pursue my CCIM designation, which has connected me with some of the commercial real estate industry's finest professionals and introduced me to some of the most important educational opportunities in my career. I am thankful for my family and friends (old and new) who have supported me during many trials and tribulations that we encountered in 2016 - none of this is done alone! 

You know me, I always like to present a challenge. During this December, I challenge you to reflect on your own successes and challenges of 2016. My hope is that you also realize the amazing opportunity we have in this thing called life to get even better in 2017 and beyond. Embrace change. Look in the mirror. Get excited for what we can do together. 

"He who rejects change is the architect of decay. The only human institution which rejects progress is the cemetery." - Harold Wilson

Inspiration

I was fortunate enough to spend last weekend in New York City, the real estate capital of the world. The reason for my trip was to celebrate some people close to me who were running the NYC Marathon - needless to say their accomplishment has me inspired to keep going and push through the pain that comes along with achieving goals. The finishers have now recovered and now thinking about what their next big goal will be - shout out to Chelsea and Brittany and the thousands of other finishers for this accomplishment!

Now, back to the real estate side of things - which has always given me inspiration even before I broke into the industry. I've been fascinated with architecture since I was a child - playing "Sim City" and posting various American cities skyline pictures for my childhood bedroom bulletin board. I always imagined what it would be like to build my very own city. Nowadays, I sell pieces of my city to creative investors who see things that others have not yet seen.

I remember visiting Manhattan years ago being enamored with the vast cityscape and energy. Now that I practice real estate I appreciate the absolute greatness that is New York City. Over 40,000 buildings and 243 skyscrapers currently make up the Island of Manhattan, with those figures increasing daily. (Side note: it is absolutely incredible the amount of growth that has occurred in the past ten years in that city - tangible evidence of global real estate investment in the USA, considered one of the smartest investment vehicles in the world.) The complex amount of navigability, negotiation, public & private partnership, management, market/feasibility analysis and persistence required to build NYC to where it is today is beyond immense. That great city didn't just get built by luck of the draw - it has been decades of extremely hard work by professionals of all shapes and sizes. Even a transaction to change ownership of an existing piece of commercial real estate is a complex undertaking for any entity.

To me, NYC represents the American dream. It shows how much we can all achieve in this world with creativity, persistence and relentless ingenuity. So many dreams came true for millions of people building that city. So much hope in everyone who makes it run every day. I am inspired by what is possible. 

How to Become Lucky

Most of you have heard the phrase "it is better to be lucky than good." Similarly, everyone has a desire to be lucky in some form or fashion. The question is, are we simply rolling the dice and hoping for good fortune? Perhaps there is a better way to predict and attract good luck into our lives?

I bring this topic to my blog today because I have been blessed with good luck in some recent real estate transactions for my clients. Things recently looked particularly unpromising towards a closed deal, and lost money for a couple of my sellers due to various transaction challenges. Lo and behold, just as we began to accept our new reality, the beautiful face of good luck has shown herself! Thanks to some luck, these deals will be closing as intended. Was it just because we wore our lucky green socks or held our breath the last time we drove through a tunnel? Perhaps, alternatively, we actually created this luck.

I am currently reading a book called "The Richest Man in Babylon." One chapter is appropriately entitled "Meet the Goddess of Good Luck." In it, the wise man says "I look to find [good luck], not at the gaming tables or the races where men lose more gold than they win but in other places where the doings of men are more worthwhile and more worthy of reward." It seems the meaning behind this is that if we are practicing worthwhile undertakings and contributing value to the world, we have more of a chance to become lucky. Hoping for luck in games where the chances are already tilted away from our favor is not the best practice towards finding luck.

The author goes on to write that "good luck waits to come to the man that accepts opportunity." Of course there will be times of loss. There will be times of difficulty. Through perseverance, through persistence, and through faith, good luck will come to those who take a chance at opportunities that come their way. Study, learn and most importantly take action. "To attract good luck to oneself, it is necessary to take advantage of opportunities." 

I hope you see the many opportunities that come your way as we wrap up the last few months of 2016. When you see something worth pursuing, take action. I wish you the best of luck! 

Just Do It

I remember in one of my very first interviews after college I was asked, "what is your dream job?" At the time, I was a wide-eyed and bushy tailed marketing college graduate, and my answer was to be the Brand Manager of Nike. I always admired Nike for their branding and positioning; to me, they were the pinnacle and gold standard of marketing and business development. I continue to admire Phil Knight, their founder, for putting together such a wide-reaching company and brand that is recognizable on every corner of the world. If you see that swoosh, you don't need an explanation of what brand you are looking at - everyone recognizes and has a preconception of the value and quality that logo brings. Of course, you are likely aware that their slogan is "Just Do It." While this is a catchy and effective phrase, it should carry inspiration to all other parts of our lives too.

Many times, I confront fear or doubt in new undertakings, business ventures, investments and other life choices. I am sure you can relate to this feeling. As a personal example, I have been searching for investment real estate for myself for much of this year. There have been hundreds if not thousands of deals that have come across my radar. After financial analysis, some fit my criteria, many don't. After further research, such as location (current and future projections) as well as property condition investigation, along with tenant profiles, the list usually is further narrowed. Many times the list is left with very few or none. At no time, the findings turn up to be perfect situation. This is where intuition comes in - you have to trust your gut after making sure the majority of logic matches up to a smart move. I have chosen to do so and "Just Do It" - I am now in the process of acquiring an 8-unit building. Don't forget, once you make the decision, "just doing it" isn't going to cut it. Make sure you are focused on the results and are tactical in how you take action - your negotiations must be factual and accurate, your due diligence must be precise and actionable, and your timing must be impeccable. Perhaps writing this is reminding me how important it is to be on top of your game.

There will be many bumps in the road. Many learning experiences. I am making an effort to trust in the process and understand that all achievement occurs on the other side of doubt and fear. If you never take a chance, you will never get the chance to live the life you dream of. 

Are you confronting doubt in your real estate future? Perhaps you are a property owner, uncertain about your future portfolio distribution, how you can add value or increase your cash flow, minimize headaches and increase your financial freedom. Maybe you are a growing or established investor, but uncertain where you can find and expand your opportunities in a competitive market. Whatever the case, I want to become the most valuable asset to your team to make certain you take hold of your wealth building future. No one gets there alone. Contact me today so we can discuss your goals and you can live the life you were meant to live. E-mail: tchesser@rpmre.com Text: 502-648-9523

All Things are NOT Equal

Equality: it is the demise of all people seeking success. UH OH. Good thing I am not running for elected office, right? Check your political correctness at the door. Good news, PC lovers, I am not talking about equality among human beings. Rest assured, I am not vying to be the potential third major candidate for President in 2016 with all this abrasive rhetoric. I ferociously believe everyone on God's green earth has the potential to achieve anything they set their mind to and take action on, no matter their background, ethnicity or gender.  All tasks, to-do's, or projects on the other hand, are NOT created equal.

I arrived to this valuable notion from a book I am reading called "The One Thing" by Gary Keller. The author writes "Anyone who lives by priority understands that some things are just more important than others. However, many people are fooled into thinking that everything has equal importance." I found this to be groundbreaking. How often do you make a lengthy to-do list and go through your day crossing off tasks from top to bottom? I am guilty. At the end of the day, what did I really progress towards in my business or life? Yep, I paid my electric bill, dropped off clothes at the dry cleaners, put away the dishes and scheduled Bruno's vet appointment. Wow - magically I am no closer to achieving anything of importance. Of course these tasks need to be eventually done, but they need to take a back seat to the big ticket priorities that will take me to the next step in life. It now makes sense to see why so many people do not progress to the next "level" in their lives or business; their entire is compiled of days, weeks, months and years without priority! Taking action towards high-priority items should be guided by our big goals.

Keller goes on to say that a to-do list should be transformed into a success list. Instead of to-do, turn that list into should-do, could-do, and must-do. Take all your must-do's and put them in order to which task is the most valuable towards getting closer to your goal. Focus on ONE THING at a time. Do not multi-task. Don't let the little things get in the way of where you want to be in life. I am taking this challenge to remind myself that to get where I want to be, not everything is of equal importance. Join me on this challenge.

I hope you find my blog valuable. If you do, please share with others! Share the love. 

 

Delayed Gratification

Today's topic is inspired by some of my mentors and people I admire in business and in life. One common trait that they all exhibit is the fact that they have the ability of delaying gratification in many different areas of their lives. Instead of seeking instant pleasure, they put in the work today to reach the satisfaction of their achievements tomorrow. This encompasses all areas of their lives: health, wealth, career, family, friendships, acquaintances and so on. Why is this simple notion so instrumental in their success?

Think about your health as an example. It is easy to recognize that constant pleasure seeking behavior can be detrimental to your health in the long term. Eating junk foods, skipping that workout, drinking that soda, (insert poor health behavior here) can all be instantly gratifying but in the long haul will add up to disastrous physical health. The successful people I know realize they must take care of their bodies for anything else in their life to materialize. They understand that their sacrifices in each small moment builds a healthy body and mind.

Take a look at wealthy individuals. Most have delayed financial gratification for many years to reach their wealth goals. They have invested time, energy and focus in their personal development through education, curiosity, passion and persistence. They voraciously read books. They attend seminars and conferences. They find and build relationships with other influential figures. They study and learn from people who have achieved what they hope to achieve. Once they achieve some form of reward from their growth, they recognize the job is not done. To achieve great wealth, they must become masters. They must invest their time and finances in instruments that create cash flow, appreciation, and many other benefits. They must take chances and realize that there will be successes and failures along the path - failures are only viewed as valuable learning opportunities. Many choose real estate investments as a means to this wealth building end (I personally believe this is the definition of financially delaying gratification). Many choose securities, bonds, debt, business ventures, or a combination of any or all of these towards their futures. Whatever their strategy, they are giving up today's rewards in intentions to reap greater rewards in the future.

How about people who have deep and rewarding family & friendship connections? These people undoubtedly have invested time and energy into these relationships as a means to show others that they genuinely care. The future relationships therefore grow more deeply as a result. Everyone benefits from the love, care and adoration that comes from the delayed gratification of these relationships.

This is not to say we cannot enjoy and live in the moment. There is a time and place to enjoy the fruits of your labor! We must step back and realize our life is all a compilation of present moments; it is essential to enjoy the gratification that we have due to our past work. If you are healthy, able to retain and take action on valuable information, have growing relationships and have a passion for a greater future, give thanks. This is all due to your past efforts and investments. Perhaps you are on your way to achieving these ends - give thanks for the process. I am making an effort to delay my own gratification, and at the same time enjoy where I am in my own journey.

Thanks for stopping by; see you next time.

Unfinished Business

No, you are not about to read a blog post about ghosts coming back to haunt you due to their "unfinished business." Please keep reading - I promise I haven't gone crazy! I am exploring this thought in a much more practical sense; the unfinished business that constantly haunts us in our business and personal lives. Do you ever feel like you have countless projects you are working on and there are ongoing or growing tasks or check-points to complete? I certainly do, and have found unfinished business can add ongoing stress to my life when I feel like projects drag on or are not totally buttoned up over time. Not to mention, new projects usually arise while others remain unfinished. 

I strive to look at most challenges with a positive attitude. This is not achieved without effort, as projects that sometimes take many months to complete can bring many negative thoughts or feelings. One way to view these challenges is to see them as a blessing that we have work to provide in our own personal lives. Without any ongoing or challenging projects, perhaps our future could seem bleak. Also, the most notable achievements in any field or in life seem to require the concentration and ongoing completion of many different levels. I began to think about this concept this weekend when I was simply power-washing and attempting to bring new life to my backyard deck. Power-washing itself was a process, but refinishing the wood would not be complete until it has dried, been coated once with sealer, dried again and covered with another coat of sealer. These steps are all necessary to preserving the deck for years to come. Each step takes time and effort.

This brought me to explore a practical example in my business. In any real estate acquisition, we must first locate a property that fits an investors' criteria. We must then analyze the deal for best and worst case scenarios for cash flow, equity, debt, tax implications and much more. Once we have determined a potential fit, we must begin the negotiation process which inevitably brings an entirely new set of challenges such as identifying potential overlapping interests, helping both parties achieve their transactional goals, and so on. The moment we achieve agreement in a deal, the due diligence begins - another time where new tasks and challenges are added to our list from inspections, financing, insurance, management and more. Only at the successful completion of due diligence can we then move to the next steps of officially acquiring the real estate, the challenges that present themselves therein, and obtaining the sought after benefits. Helping my clients realize and overcome all that is required to obtain these benefits is why I am in business.

I believe to make any significant progress in our lives, we must face multi-faceted challenges that are not necessarily solved immediately. The ability to withstand this ongoing pressure with continuing focus will separate success from failure. Do you agree? Send me your thoughts at tchesser@rpmre.com.

 

"Scared Money Don't Make Money"

I am sure you have heard this expression before: "Scared money don't make money." I wholeheartedly agree and have witnessed prime examples time and time again in the world of real estate and elsewhere. Investors who are timid in making deals because they want to save every penny sometimes are not paying attention to the big picture. Sellers who are reluctant to make necessary upgrades may not have the success in disposing of their asset due to a limited buyer market - in some instances they have saved pennies and lost major dollars. Professionals who do not spend time, treasure and effort into investing in their minds and craft are leaving opportunities for others to seize. Perhaps you could look at these examples as individuals stepping over dollars to pick up nickels. This is the difference in success and failure.

Real estate investors obtain many benefits from their holdings, including: depreciation and interest tax write offs, cash flow, equity appreciation, hedge against inflation, leverage - the list goes on and on. Buyers must delay gratification of what cash today can buy them to gain the many financial benefits that real estate can bring them in the long run. Investors who are "scared" that the market may go down, or tenants may tear up their property or they may not have enough cash to cover their other expenses will not be entitled to the many benefits that real estate can bring them otherwise. I encourage my clients to make informed decisions and understand that taking the risks associated with smart real estate investments can bring stellar financial results. Only the stellar results are rewarded to those who take a chance to earn them. The most successful are those who understand that taking a risk is the only way to get to the next level.

What areas of your life are you being timid? Are you sticking to the status quo in your personal life or career? Join me in the journey of taking calculated risks to get to where you want to be. Message me tchesser@rpmre.com and help me understand the areas in your life where your capital can be more appropriately deployed to create better results. Thanks again for stopping by my blog and I will see you next time.

Mindset of Abundance

In life, there are many variables at play. Some days things go our way and others couldn't be more opposite. This is the case in so many areas of our life, whether it be with family, friends, political affairs, investments or our professional lives. I believe that facing this unequivocal and certain adversity, we must adapt a mindset of abundance. I argue that adopting this mindset is essential to continued success and living a rewarding life.

In many ways, attitude is everything. In my career, I only get paid when I create results. In my life, I only am rewarded when I add value to others whether it be through friendship, service or attention and care. I wouldn't have it any other way and, thus, I have no choice but to have a mindset of abundance. This genuine mindset, in my opinion, creates an aura and energy that attracts more results or more rewards. However, I frequently observe the opposite - a mindset of scarcity - that some embody. The mindset of scarcity includes fear, nervousness, and negativity, among other attributes. I argue that this mindset breeds exactly the results of which these thoughts bring. After all, Buddha said "The mind is everything -  what you think, you become."

I bring this topic to light due to a meeting I had yesterday with a client whom I am honored to align myself with. This person has truly created a life to be proud of through a mindset of abundance. While creating a life that many others would think impossible, through nearly exclusive real estate investment, he has withstood many adverse conditions over the years with a rock-solid mindset. He mentioned to me that there are guaranteed to be, and have been, many naysayers. There will be those who say the negatives are unavoidable and a final detriment to any goal or plan. I am convinced that mindset of abundance, and a clear eyed attitude is the key to living the life you want to live. Don't chain yourself to the mediocrity of what others tell you is possible.

What can we do to live with a mindset of abundance to achieve the life we want to live? Personally, I hold a lucky $100 bill in my wallet at all times. It reminds me that at any time, I am not desperate to make any deal and that I am always in a position of strength. This simple reminder has proven to be very powerful in my life. I would love to hear your thoughts on how we can grow in this area together.