Ep 37: Maintenance and Tech in Multifamily Syndication with Chris Jackson from Sharpline Equity
We get into some of these processes with our guest for today, Chris Jackson of Sharpline Equity. Chris is into large multifamily syndication, currently operating 300 units with over five deal cycles under his belt. First up, Chris gives us some insight into his background in tech and how he experimented with flipping and being a landlord before ending up where he is today. We then get into some daisy-chain/assigned deals that our hosts have been involved in, some laughable and others very successful.
Our conversation also covers the idea of technology as it relates to the traditional brick and mortar world of real estate. In this respect, we talk about how syndication has changed since Facebook and Instagram, ways that introducing technology into management processes can either be a help or hindrance and more. We then share some ways that ignorant investors could be a lot more educated before taking a deep dive into the weeds of managing and maintaining buildings and how this comes into play while buying, selling or operating. We talk about the allure of partially renovated buildings from a value-add perspective, what to look out for before buying older buildings, below-the-line versus outside-in renovation strategies, and many other interesting points. For some great content about what the daily life of a syndicator looks like, make sure you tune into this one!
Key Points From This Episode:
Chris’s journey in tech, and following a long time dream to pursue real estate after.
Why Chris started in multifamily, moved into flipping and then went back again.
How Chris got better on the phone through flipping thus got better at raising capital.
The idea that people don’t get how expenses fluctuate behind spreadsheet numbers.
Measuring experience on unit count versus full deal cycles and the legitimacy of the latter.
Buying unvetted deals and how bigger companies, as well as inexperienced investors, do this.
How to partner up and raise for expensive deals correctly: don’t find too many partners.
Traditional partnerships and syndication before the crowds and shady deals of Instagram.
A daisy-chain deal in Orlando that went from $16 to $9 million.
An assigned Jacksonville deal that Chris and John took from wholesale to close.
Why fully renovating leaves no more value adds on a building thus attracts fewer buyers.
Unseen and costly renovations that have to be made on buildings hitting 50 years.
Appreciation for buildings with older owners who have maintained them the right way.
Below the line maintenance and how it produces better yields in the long term.
Inside-out vs outside-in renovation strategies and how to win new renters.
How important good photos and marketing are to find renters for a good property.
Reactive vs proactive maintenance/marketing/management, and good vs bad syndicators.
Cross-referencing leasing agents by doing their job provided they have been briefed.
How helpful apps like Slack and Trello can be but the difficulty in implementing their use.
The way technology can be a barrier to the willingness of more senior partners to invest
Antiquated non-technologically savvy processes still used in real estate, a non-tech area.
How tech can be a hindrance, leading to forgetfulness and losing money.
“Reboot that sucker and have a different perception by the next owner.” — Chris Jackson [0:29:19]
“People are just paying attention to unit turns and topline. We are paying attention to cap rate and compression by banks rewarding you for doing the cap-ex that people aren’t doing.” — Chris Jackson [0:33:51]
“I’m not saying we said, ‘Slack,’ and then it was tech bros all day. It was a lot of like, ‘Why aren’t you using it, you haven’t logged in all week?’” — Chris Jackson [0:52:01]
Links Mentioned in Today’s Episode:
Get in Touch
Toro Real Estate Partners - http://tororep.com/
The Real Estate Investing Experience - https://www.thereiexp.com/
The REI Experience YouTube - https://www.youtube.com/channel/UCjt6pmkA8ogACZ26oqhBM0g
The Real Estate Investing Experience Podcast - https://podcasts.apple.com/us/podcast/the-real-estate-investing-experience/id1481520260