I'm a pretty avid rudder. And recently, my foot had been bothering me for running so much.Then, my friends at Altra Running sent me a pair of shoes to try.I got the Experience Flow, which is a road running shoe.
And I can't tell you how surprised I am with how comfortable these shoes are.My foot pain is gone, and running has never been more enjoyable.The thing with Altra is that every pair has a roomy toe box, and I could immediately tell the difference.
My feet aren't crammed in or squished.They're super comfortable.
Altra also makes their shoes zero to low drop, which basically means your heel isn't elevated off the ground like some other shoes, which is great for enhanced balance and keeping your feet in a more natural position.
It's all-day comfort that you really do need to feel to believe. And right now, you can try a pair risk-free with a free 30-day trial.So, try them out, and if they're not for you, send them back for a full refund.
Just head over to ultrarunning.com and find your new favorite pair of shoes today.That's A-L-T-R-A running.com.Stay out there with Ultra.
Subtle results, still you, but with fewer lines.Botox Cosmetic Out of Botulinum Toxin A is a prescription medicine used to temporarily make moderate to severe frown lines, crow's feet, and forehead lines look better in adults.
Effects of Botox Cosmetic may spread hours to weeks after injection, causing serious symptoms.Alert your doctor right away if difficulty swallowing, speaking, breathing, problems or muscle weakness may be a sign of a life-threatening condition.
Patients with these conditions before injection are at highest risk.Don't receive Botox Cosmetic if you have a skin infection.
Side effects may include allergic reactions, injection site pain, headache, eyebrow and eyelid drooping, and eyelid swelling.Allergic reactions can include rash, welts, asthma symptoms, and dizziness.Tell your doctor about medical history.
muscle or nerve conditions including ALS or Lou Gehrig's disease, myasthenia gravis, or Lambert-Eden syndrome in medications, including botulinum toxins, as these may increase the risk of serious side effects.
For full safety information, visit BotoxCosmetic.com or call 877-351-0300.See for yourself at BotoxCosmetic.com
Quick disclaimer, the views and opinions expressed in this podcast are provided for informational purposes only and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.
For more information, go to bestevershow.com.
We execute the business plan well, we can essentially scale into the next project, bring those investors, we've made them their money, they want to continue to keep their relationship with us and go in.
Welcome to the best ever CRE show the world's longest running daily commercial real estate podcast.
If you want real stories behind the good, the bad and the worst ever deals plus insights into what really goes on in the commercial real estate investing, you're in the right place.
Our hosts interview commercial real estate experts every day to uncover secrets and strategies you can use to become a better, more informed investor.
This is the best ever CRE show.Best ever listeners.Welcome to the best ever CRE show.I'm Slocum Reed.And today we are joined by Michael Weberle.Michael is joining us from Nashville, Tennessee.
He's a managing partner of Trinity Mountain Capital with an emphasis on due diligence and asset management. Trinity Mountain currently has three multifamily assets in North Carolina totaling 346 units.
Michael, can you tell us a little bit more about your background and what you're currently focused on?
Yeah, so my background is IT and I worked for a real estate developer out in Boise, Idaho, and then we moved here to Nashville three years ago.
transitioned like a lot of people when real estate was hot and got into real estate in the multifamily space.
And I have some fantastic partners I've been learning from and working from that we eventually closed two deals last year and just close our third deal out six weeks ago here in Durham, North Carolina.
Michael, tell us more about your multifamily experience before the two deals last year.
Yeah, so I've always had an interest in real estate.I lived in Boise, Idaho before I moved to Nashville.And while I was there, I did IT work for a real estate developer who focused on his developments for LIHTC affordable housing.
And I always assumed people in real estate come from a background of real estate.That's where they started their career.This developer I worked for was a pastor for the first half of his career and quickly realized
working for that developer and his private management company that you necessarily don't need to come from a background in real estate.Anyone can really get into this business.
So when we moved to Nashville in 2021, like everyone else, I jumped in on real estate, joined a mastermind, and that's where I met my partners and
Really got the experience on the acquisition side and under right properties and eventually thankful to the group I work with.They were looking for some assistance in a project in Jacksonville, North Carolina.
I came on to help project manage that project.It's all value add in Jacksonville.
Nice.All three of your current deals are in North Carolina.
Yeah, that's where we've primarily focused at the moment is in North Carolina.As a group, we've talked about looking at other states.There's pros and cons that I think it's nice being in North Carolina.
Cause as we've grown there, we've learned state and local laws that apply.There's also, I think just some culture differences from being in different states.So I think there's a benefit for us just being in one state at the moment.
Does Trinity mountain have a local partner there in North Carolina or in one of the markets where you have assets now?
No, we third party manage everything from here in Nashville.
So we're constantly going over once, twice a quarter to check on our assets, make sure things are getting done that the management company says are happening and verify quality control and making sure our residents have a good place to live and the on-site staff's taking care of our residents.
Are these three deals the first major syndicated real estate deals for all of the partners at Trinity Mountain?
This is Trinity Mountain Capital's first acquisitions where these three deals in North Carolina, the sponsors I work with have been doing this for a number of years.
So with the skillset I've had at previous jobs, they needed some project management to help with their projects on the CapEx side.
So that's where my skillset came in to helping get these projects started and ongoing, and then working with the CFO, building out the due diligence process.
And that's where we've started really enhancing over the due diligence process when we get a property under contract.
makes sense that you'd be the one taking multiple trips a quarter to go check on the assets as well.So there are other lead sponsors or lead GPS or operators for these deals.
Yes, there are.And their assets are already in North Carolina.So they're very experienced.They've already had property managers managed other assets.So they already had a lot of the things already in place when I got started with them.
Michael, my conversational style, especially for this podcast, is that I like to summarize, but also make assumptions.The reason I'm saying this now is that I hope you will correct me where I'm wrong, because I'm going to make some assumptions here.
So please tell me where I'm wrong.Michael, making some assumptions here, you were newer or brand new to
syndicated multifamily deals just last year, and you were looking for a way to get into the space and you had some obstacles to overcome in that you didn't have your own personal track record yet.
So you found lead sponsors that you could partner with to add your expertise to what they already had going on and add value to those deals as your way into multifamily.Is all that fair?
That is an accurate assumption.
Okay, good.Michael, I want to focus on the best ever listeners who are looking to break into the general partnership space on syndicated multifamily.How is it that you identified this opportunity as your in to get in on the GP economics?
Man, that's a great question.So for me, I think everyone has their own way into the industry.I think for me, I joined a mastermind and that's where I met my partners.Cause I wanted to learn and learn rather quickly and from other people's mistakes.
One of the co-sponsors and I had a deal in Austin, Texas and that deal did not close, but through that process. I was able to show how I operate, how I, my thinking is, and we were able to connect in that aspect.And we built a relationship.
I think that's really where it starts is building a relationship with sponsors and almost offering to work for free is what it is.In the asset management space, you get the small percentage of asset management fees of these properties.
And I was willing to put in sweat equity into these projects with my background.And I was able to help fill a gap of what they were needing at that time.
Tell us more about how you positioned yourself to add value to your current partners.
I think one way to add value to the current partnership is just going above and beyond doing because when I was originally brought on, it was really for a specific role in the project management, but just continuing podcasts like this, other resources, learning the business, I've been able to really
broadened the scope of what I do beyond originally what I was asked for.I think that goes a long ways and just it's a little old school, but under promise over deliver.
So I want to build this as a long-term relationship with the group I'm working with and our investors, because I want to be this in the long-term.
So I want to make sure, even though my original responsibility was really tiny, I want to make sure that the asset does what it's supposed to do.
We execute the business plan well, and we can essentially scale into the next project, bring those investors We've made them their money.They want to continue to keep their relationship with us and go into the next deal together.
Everything is long term.I don't look at anything as short term.So that's why when I work with the groups I work with is I want to make sure not only do I succeed in my niche, but if there's other areas of the asset, where can I help fill those gaps?
Michael, feel free to answer this question in broad terms, but with these three deals specifically, you've referenced work for free or volunteering opportunity to prove yourself, gain sweat equity.
How is it that you are being compensated for your participation in these deals?
So with these deals, I share a percentage of the asset management fee, and then there is a percentage of the general partnership.GP split is that what I get and also for filling these roles, but also
As I continue to work on my capital raising, that'll also give me more general partnership credit as well.
So a portion of the asset management fee and a piece of the GP action for your efforts in executing on the team's business plans.
Correct.And that's not just for myself, but like I said, the partners and the investors, I want to make sure this deal succeeds for everyone.Cause I'm looking at this longterm and so I'm willing.
to sacrifice a little now so we can continue to build my portfolio and our investors portfolio long term.
Particular to these three assets, Michael, what's been your biggest challenge?
I think the biggest challenge we've faced, especially the two we have in Jacksonville is even the one in Durham, I would say is just I live in Nashville.
It's not easy to get to those places as much as we would like, as well as we're doing some value ad play on all three properties.And the challenge is The quality control, there's things we don't like.
Some of the contractors, we're moving in residents into units that quite aren't fully renovated to our high standard.There's just simple maintenance requests.
Now we're having to spend an additional capital going back and fixing these maintenance issues.So that's been one of our biggest challenges with that.
being so far away from these assets and not been able to do as high quality control as we would like.Because when we move someone in, our goal is to keep them there as long as possible so we can reduce those turnover costs.
Somebody resident moves in and their GFCI doesn't work correctly.Their doors don't close as they should.Cabinet doors don't close.It's a bad look on us.And that's something we need to address before that resident moves into the property.
What have been your answers to that challenge on quality control with rehab?
I think two things, well, when we come to quality control, one of the solutions we've had on the quality control side is we're looking for someone who lives in the market who needs part-time work where they can come in and just walk the units when supposedly our contractors are done and let them go through and third party check that for us and then say, okay.
Here's your punch list and then send them back in to go fix the things they should have done the first time.And then the other thing is, and this is what's really taken priority at the moment.
We're going to just find a new contractors because there's the contractors we have are a little cheaper, but their time to get things accomplished takes longer.
So we're just looking for new vendors and contractors to fill the void and fix the gap of this quality control.
How many different contractors have you worked through on this?
Several.I think we found a good GC that we like so far.It's done good work for us so far.They're taking on the property.We just closed in Durham.So we've gone through several different contractors.
This is a bit of an aside, but I think most, at least long-term fans of the best ever podcast are going to be familiar with the research triangle. they're not necessarily going to be familiar with Jacksonville, North Carolina.
What can you tell us about that market?
So Jacksonville, North Carolina, it's the home of Camp Lejeune.So it's a big military town.It is tertiary.So it is out there a ways from any major market.So it's a big military town, lots of military employees.
The town is growing just about a mile and a half, two miles from the property.They've added a whole new shopping center.So there's definitely growth in the market.It is just a military town.
So our turnover costs are just a lot higher than you would anticipate in a major market or a market that's not so military driven.
That makes sense.Outside of.Asset managing the apartment turns.What else have you been doing with these deals?
With these deals, really building out our KPIs, obviously we're tracking our construction, how much it's costing us, what our returns are.And then we're also tracking our marketing metrics.How's our leasing going?How's our renewals going?
How's the work orders going?And the other thing we really focus on is how do our residents feel about the property?So we're just really on a cadence now of every quarter we send out quarterly surveys.
that we track, would you recommend the property to a friend?Do you enjoy living here?How can we make your home a better place to live?
And then we're also just asking additional questions we have, whether it's their preferred method of communication, do they feel safe in their community, their neighborhood, their home, and just continue to track how the residents are feeling to make sure our onsite management is responding to work orders in a timely manner, as well as building a sense of community at the property.
I know these acquisitions are pretty recent, Michael, but what has come from this analysis and feedback from the tenants?Let me give you some background on me, Michael.
I'm an apartment owner operator who also does third party property management and construction management.
So we're finally really doing a deep dive into the analytics of the leasing process, tenant retention, doing tenant surveys and things like that.So this is relatable for me, particularly.
that I'm trying to figure out all of these things require effort, all of this analysis, all of this surveying feedback.
So I'm also trying to figure out right now what feedback and what data is actually going to help me move the needle on the financial performance of the property. stemming from making it a great place to live.
So I guess my question here is coming from the data you're collecting, tracking your KPIs, getting tenant feedback, what have you been able to implement or what results have you seen from that tracking and asking for that feedback?
I think one thing that we really track is, are you willing to renew your lease?And the other thing is, would you recommend this to a friend or family?Those are probably the two biggest questions.And those are the same questions we ask every time.
And then we want to build up the properties, a sense of community.So how can we continually to improve the lives, the neighborhood of the residents.So a lot of, I think, the best questions are open-ended questions.
Like, for example, how can we make your home a better place to live?And we've gotten some great feedback from residents on how we can do that and how we can implement those ideas for the residents.
Because again, our goal is to get them to stay there longer.If they've got suggestions on how we can improve their home, they're not going to go.For example,
One survey we just sent out last quarter, again, this is easier said than done, but they recommended we build a covered shelter place for when the kids are waiting to get on the bus, they can stand or not get wet.I don't know.
There's some challenges of where we would need to get built, so I'm not sure if we can fully implement that, but there's things that we can take from the residents who live there and put into the property that's going to keep them there longer.
And then also looking at it from the perspective of making sure the on-site management is taking care of those residents and the work orders are getting done in a timely manner.
Because the site manager may say, yes, they're getting done, but the residents may feel differently.
Gotcha.I'd like to pivot the conversation again.Michael, when you were introducing yourself, with a background in IT.I was struggling to understand how that would translate into multifamily real estate investing.
I can see some of the picture here, but tell us a little bit more about how your professional background and personal background led you to be a good fit for this asset management operational oversight role with these three properties.
My background fit into this because I come, like I said, an IT background.I did IT for a property management company for years.
So I guess in theoretic, since I had a good understanding of how property management works, but I saw the inside of how property management works from a 10,000 foot view, let's say.
And then we also had to manage some fairly significant IT projects across that real estate portfolio.So kind of leading those efforts, I could easily scale it into this role that I currently have now.
Nice. Well, I'd like to wrap up this conversation, Michael, with another set of assumptions.Let me know what you think of them.I'm going to call this the Michael Webberley masterclass for breaking into multifamily syndication.
I think through this conversation, we touched a lot of things, but you came back to four points in particular that I'd like to point out for our listeners.The first for breaking into multifamily is to join a mastermind, both to learn and to network.
The second is to build relationships with people in the business that you can add value to.Three is to find your niche, a place where you can add value, whether you're doing it as a volunteer or for sweat equity in deals.
And the fourth point is to focus on relationships
Sign in
