Passive Real Estate Strategies Justin Moy

Are you a career driven individual looking to maximize your wealth without taking on more responsibility or compromising your time? In this episode, Justin will be discussing private money lending and how it can fit perfectly into a passive investor's portfolio. We'll also talk about the benefits and drawbacks of investing as a private money lender, such as the fixed return on your investment, the short-term nature of hard money loans, and the potential to make significantly more than 10% on an equity position if the property performs as expected. Tune in to learn more about private money investments and how you can use them to maximize your wealth without taking on too much extra responsibility or compromising your time!




Key Highlights:


[00:01 - 02:11] Understand the Benefits and Limitations of Private Money Lending for Real Estate Deals with Passive Real Estate Strategies Podcast
• Private money lending can be done entirely by you or in a fund
• Loans are taken in debt position as opposed to an equity position
• Money can be deployed from 6-24 months with a healthy return




Key Quotes:


"So hard money lending is generally safer, has a more predictable return, and is collateralized by the property." - Justin Moy


Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.


Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.


Want to invest with us? Schedule a brief call here. 


Get in touch: Justin@arealminvestor.com and let me know what topics you’d like me to cover or what guests I should have on.


If you like our content, please give us a rating on the platform you’re listening on!

How do you gain insights on strategies and metrics in Real Estate investing? In this episode, Joe Ollis dives into their approach to real estate investing. The Peak Group is a vertically integrated single-family rental platform that owns and operates around 2000 homes across the south of the United States. Joe will discuss how they use both data and boots on the ground knowledge to identify trends in markets such as Dallas, Florida, Charlotte, North Carolina, Tennessee, Georgia, and Alabama. He'll also explain how 65% of their portfolio is currently cash flow positive. Additionally, explore how competition for certain asset classes has driven up prices over the past several months and hear strategies for investing in secondary or tertiary markets where there is less institutional competition. Learn how rising mortgage rates affect home buyers and institutional groups, as well as their strategies for navigating the current market and underwriting properties. Get advice on how to plan for and account for property taxes when underwriting too! Tune in now to get a glimpse into the world of real estate investing through the lens of Joe Olis from the Peak Group!




Key Highlights:


[00:00 - 05:52] Understand Your Sponsor's Market and Underwriting Strategies 
• The Peak Group is a vertically integrated single family rental platform, with a privately traded REIT owning and operating approximately 2000 homes across the US
• Joe's role is to act as a fiduciary to take care of investors' best interests, helping them choose the right strategy for investing in single family rental products
• Joe uses data to identify simple trends and boots on the ground knowledge to identify where to build new product
• 65% of their portfolio is currently in Dallas, with other markets spread through Georgia


[05:53 - 11:43] Competition in Real Estate Market Causes Investors to Re-Evaluate Investment Strategies
• The market has significantly shifted in the last three months
• Competition is high in many markets, making it difficult to compete
• Investors should look into secondary or tertiary markets for higher yields and less cap rate compression
• In early January 2022, rent growth of 9-10% was needed to make a 4.5 cap purchase
• Since January 2022, no purchases have been made due to pricing getting out of whack
• Sellers are not motivated to sell due to lack of efficient capital deployment options
• Fewer buyers on the market leads to lower sales prices


[11:44 - 17:46] Property Taxes Bite Hard: How Investors Can Plan for the Unexpected
• Mortgage rates have increased from 4% to 8%, impacting home buyers and institutional groups
• Investors are able to find good deals in the market by purchasing all cash and refinancing when interest rates lower
• Underwriting boils down to cash yield and undeployed equity, with the biggest lever being the cost of debt
• Property taxes are the number one thing that can screw up a pro forma long term, especially in Texas where they increased 23%
• Investors should be pessimistic when underwriting expenses for property taxes




Key Quotes:


"I think the market has significantly shifted even in the last three months, and we should totally talk about that." - Joe Ollis


“If you're sitting on cash right now and you have the ability to go deploy it, you can find some good deals in the marketplace.” - Joe Ollis






Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.


Check out our Multifamily Syndication Group, and sign up for our

Are you looking to understand the ins and outs of passive real estate investing? In this episode, Justin will be discussing the different deal structures and capital stacks associated with syndication deals. He will discuss Preferred Equity and Preferred Return, two terms that are often used interchangeably but mean slightly different things. He will also discuss the use of waterfalls and hurdles, as well as the catchup pool in a waterfall distribution system. This discussion is designed to help career driven individuals understand passive investing so they can take advantage of these opportunities and determine if it is right for them. Tune in now to gain insight into the world of passive real estate investing!




Key Highlights:


[00:01 - 08:54] Uncovering the Extensive Process Behind Syndication Deals: What Goes Into Bringing a Great Deal to Investors?
• If a property performs as projected or exceeds projections, investors not in the preferred equity pool will make a greater return
• Return of capital needs to be returned first 100% before paying out any distributions
• General partnership had a guarantee of $50,000 in returns per year over a five year period
• GPS get paid out a greater share of profits as property is more successful
• Complex structures should be reserved for sophisticated investors




Key Quotes:


"By doing our physical inspections, that means we're bringing in more contractors, we're bringing inspectors, engineers, or anything else that the property needs." - Justin Moy


Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.


Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.


Want to invest with us? Schedule a brief call here. 


Get in touch: Justin@arealminvestor.com and let me know what topics you’d like me to cover or what guests I should have on.


If you like our content, please give us a rating on the platform you’re listening on!

How do you minimize the risk of a worst-case scenario? In this episode, Jaspreet Baveja shares his journey from quitting his job to pursue more active roles in syndication and private lending. He explains why diversifying investments is key and offers advice on understanding the complexities of asset classes and investment opportunities. Plus, Jaspreet tells us a cautionary tale about his worst experience investing in a marijuana operation in Salinas, California - and what he learned from the experience. So if you're looking for tips on how to make smart investments, tune into this episode for an informative conversation about all things real estate!






Key Highlights:




[00:00 - 07:29] Avoiding Worst Case Scenarios in Passive Investing: Jaret Veja's Experience as a Limited Partner


• Jaspreet Baveja quit his job as a healthcare regulatory compliance consultant to pursue real estate investing in 2019


• He has been an LP in seven deals and is also actively a GP on the active side through a few deals


• He was drawn to the LP side due to not having to manage and track investments on his own end


• He eventually jumped into the active side when he had more time and energy after quitting his job


• He diversified his investments into multiple asset classes such as apartments, warehouses, office spaces, self storage facilities, and multi-family deals


• His strategy was to invest small amounts of money




[07:30 - 13:44] Diving Into Asset Classes


• Vetting the operator and understanding their experience was more important than the asset itself


• Looking for metrics that drive decisions to invest in a particular asset class and market


• Taking a conservative approach with lowest numbers for revenues, growth, and highest amount of expense growth


• Underwriting is both science and art


• Making a personal decision based on available funds and potential gains (experience, relationships, networking opportunities)




[13:45 - 20:47] Investing in Marijuana Operations: A Cautionary Tale of Losses and Red Flags


• Warehouses for bulk storage, like Amazon, FedEx, and UPS are seeing massive growth due to online shopping


• Multi-family is the most exciting investment opportunity due to population growth from tech jobs, political influences, and cost of living


• Office space is still up in the air due to employees pushing back against employers who want them back in the office


• Worst experience was investing in a marijuana operation facility that was shut down by the city of Salinas






Key Quotes:




"Warehouses that are more designed to be warehouses for bulk storage, like Amazon spaces or FedEx, ups, those kinds of things. I think they're gonna continue to see growth." - Jaspreet Baveja 




“Definitely the experience of the operator matters the most to me, beyond the assets.” - Jaspreet Baveja 










Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.




Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.




Want to invest with us? Schedule a

Do you ever wonder what it takes to bring a real estate deal to investors? In this episode, Justin explores the two-phase process of syndication and how operators need to carefully vet deals before finding a suitable property. He discusses the difficulty of sustaining rent growth when tenant incomes remain stagnant, and how only 1% of all deals meet an operator's criteria. He explains how he uses data such as crime rates, income levels and job growth to evaluate a potential deal. Plus, learn why it can take up to 30 days or more for legal teams to iron out all the details of the purchase and sale agreement. Tune in for an in-depth look at the process for bringing real estate deals to investors through syndication.




Key Highlights:


[00:01 - 02:05] Uncovering the Extensive Process Behind Syndication Deals: What Goes Into Bringing a Great Deal to Investors?
• Process of bringing a deal before investors is extensive
• Two phases: getting the deal under contract and contracted phase
• Finding the deal is the biggest part
• Underwrite a ton of deals to find great deals
• Creating pro forma incomes, projecting expenses, bringing together insurance and taxes, operating expenses
• Analyzing crime, income, job growth, and tenant base




Key Quotes:


"By doing our physical inspections, that means we're bringing in more contractors, we're bringing inspectors, engineers, or anything else that the property needs." - Justin Moy


Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.


Check out our Multifamily Syndication Group, and sign up for our NEWSLETTER.


Want to invest with us? Schedule a brief call here. 


Get in touch: Justin@arealminvestor.com and let me know what topics you’d like me to cover or what guests I should have on.


If you like our content, please give us a rating on the platform you’re listening on!

How do you choose between passive and active investing? In this episode, David Robinson shares his story of taking inventory of his life after the passing of his father and how it led him to become an active real estate investor. David provides insight into the pros and cons of investing in real estate. He reveals that there are three different investment styles: active, passive, and something in between. David explains that buying small multifamily properties has its benefits such as getting conventional financing, full control, and the potential for passive income streams. He then dives into three different passive investment strategies he recommends evaluating to find the one that best suits each investors’ lifestyle needs. Lastly, he discusses how market uncertainty has caused investors to be more conservative and look at more than just returns when making decisions. Tune in now to learn how you can get started with real estate investing!




Key Highlights:


[00:00 - 07:45] Taking Inventory of Life: How a Routine Heart Surgery Changed the Course of My Real Estate Career
• 5 years ago, had an "aha" moment to take inventory of life and finances
• Realized he hadn't done enough to build up substantial cash flow and wealth
• Started real estate sales business in 2003
• Pivoted to traditional residential resale and built sales teams
• Had a moment with his dad's heart surgery that made him realize things had to change
• Opened up a small boutique brokerage that focuses on serving buy and hold investors
• Got involved in larger commercial multi-family syndication 2 years ago
• Discussions with investors led to 3 buckets: active investor, passive


[07:46 - 14:57] Exploring the Benefits of Investing in Small-Scale Multi-Family Real Estate: Control, Passive Income, and More
• There are three types of real estate investors: active, passive, and a blend of the two
• The goal of the investor should be determined before deciding which type to pursue
• Passive real estate investing requires effort on the front end
• Benefits of owning a small personal portfolio include: access to conventional residential financing, full control, and the ability to structure deals in a way that is fairly passive
• Investing in master planned fourplex communities managed by an HOA is one way to get close to a passive investment while still owning your own property


[14:57 - 22:13] Navigating the Uncertainty of the Market: How to Build Wealth and Cash Flow in a Buyer's Market
• Investing passively can save time and money, but may sacrifice return
• Every deal needs to be evaluated on an individual basis
• Generally speaking, investing in your own deals will yield higher returns
• The discussion is more around lifestyle strategy than returns
• Uncertainty in the market is causing investors to take a more conservative approach
• There is a gap between what sellers are hoping to get for their property and what buyers/lenders are willing to pay
• Deal volume is dropping off due to sellers not wanting to sell at lower prices
• There is more demand than supply in the market today




Key Quotes:


"If you are willing to be more active and play more roles, then that piece of the pie that would go to that general partner or asset manager, isn't being taken out of the pie." - David Robinson


“If you're a true seller in the market today, you need to price aggressively and get out of that.” - David Robinson




Download our FREE ebook, The Definitive Guide To Passive Real Estate Strategies.


Check out our Multifamily