RG 281 – Maximizing Profit & Minimizing Expenses in Multifamily with Terrance Doyle

This week, we have the privilege of hearing the story of Terrance Doyle, a long-time entrepreneur with over 13 years of experience and the founder and managing partner of The VareCo, a private real estate investment firm specializing in value-add properties across multifamily markets in Denver, Colorado and Des Moines, Iowa.

Terrance Doyle has been an entrepreneur since 2008. He started with a carpet cleaning company, then moved on to real estate when he saw the opportunities after the 2007 recession hit. He flipped house after house, building his portfolio—even buying his own basketball team in Spain—and today, he is the founder of The Vareco, a private real estate firm with over $80 million dollars of assets under management.

Terrance is someone who values lasting relationships with partners, be it investors, contractors, or sponsors. He is a believer of perfecting businesses and systems within the business; hiring other people to address one’s weaknesses; and getting the right people on the ground.

Now, Terrance focuses on attracting outside capital to scale his business, which he also talks about in this highly insightful episode. Whether you are a beginner or an experienced entrepreneur, you’re going to want to hear about how Terrance runs his business—and helps others build value in their lives in the process.

Links:
https://thevareco.com/
https://www.linkedin.com/in/tjdoylemathew633/
https://www.biggerpockets.com/users/terrancedoyle

Key Takeaways

• Hire people that are good at things that you are not.

• Understand your strengths from Day 1.

• Nurturing your relationships with your people can help you stay ahead of the curve.

• Investors’ perception of your track record will depend on who your audience is.

Be Bold, Be Brave and Go Give Life a Crack!

Reed Goossens (00:00):

Good. Hey guys. Now, before we dive into today’s show, I want you to let you know that some of you may be aware that over the past eight years, I have built a substantial multifamily real estate portfolio here in the US worth over half a billion dollars. And in that time, my passive investors have received fantastic double-digit returns. And now you too can invest directly into my deals for as little as $50,000. So if you’re an interested investor, head over to [inaudible] dot com to find out more that’s Reed goossens.com. Now back into the show,

Terrance Doyle (00:40):

You just have to know who your audience is. So institutions are looking for fund two or three, so like really sophisticated institutional capital. So like the pension fund in California is never going to invest in fund one, right? They’re going to invest in fund four or five once there’s multiple years of audited financials and a track record. But you know, the family office in cherry Creek would, would potentially look at it because they could understand where we’re at and they understand they’re going to get disproportionate returns in exchange for being fund one. So I think you have to really know your audience, know who you’re going after.

Reed Goossens (01:21):

Welcome to investing in the US a podcast for real estate investors, business owners, and aspiring entrepreneurs looking to break into the US market join Reed As he interviews go getters risk takers and the best in the business about their journey towards financial freedom and the sheer joy of creating something from nothing

Reed Goossens (01:41):

Good day, good day a ladies and gentlemen, and welcome to another cracking edition of investing in the US podcast from Los Angeles. I’m your host Reed Goossens good as always every with us on the show. Now, I’m glad that you’ve all tuned into learn from my incredible guests and each and every one of them are the cream of the crop here in the United States. When it comes to real estate, investing, business, investing, and entrepreneurship, each show, I try and tease out their incredible stories of how they have successfully created the businesses here in the US how they’ve created financial freedom, massive amounts of cashflow, and ultimately create extraordinary lives for themselves and their families life by design. As I like to say, hopefully these guests will inspire all of my cracking listeners, which are you guys to get off the couch and go and take massive amounts of action.

Reed Goossens (02:28):

If these guys can do it. So can you now, as you know, I’m all about sharing the knowledge with my loyal listeners, which is you guys, and there’s absolutely no BS on this show, just straight into the nuts and bolts. Now, if you do like this show, the easiest way to give back is to give us a review on iTunes. And you can follow me on Facebook and Twitter by searching at Reed Goossens. You can find the show, every podcast on iTunes, SoundCloud, Stitcher, and Google play, but can also find these episodes up on my YouTube channel. So head over to Reed goossens.com, click on the video link, and it’ll take you the video recordings of these podcasts. You can see my ugly mug with the beautiful faces of my guests each and every week. All right, enough of me let’s get cracking and into today’s

Reed Goossens (03:15):

Today on the show, or the pleasure of speaking with Terrance Doyle. Now, Terrance is the founder of [inaudible] real estate investment firm, which is based in Colorado Denver. And over the past seven years, Terrance has grown the portfolio with over 1000 real estate transactions. And currently they have more than $80 million assets under management Tara’s creates value in his business, through his lasting relationships with these constructing partners, lending partners, brokerage partners, but he tops it all off by perfecting his businesses and systems within the business. He’s also the co-host of the new BiggerPockets podcast, the tribe of multifamily mentors, which you can find across all podcasting platforms. And to top it all off Terrance is passionate about helping others create value in their own lives to real estate investing. And he has helped countless of investors make the jump from single family to multifamily investing. So I’m really pumped and excited to have him on the show today to share his incredible insight in story with us, but not for me. Let’s get him out here. Good. I Terrance, welcome to the show. Hey, do it today, mate.

Terrance Doyle (04:14):

Great to be here and big fan of yours. So thanks for having me on,

Reed Goossens (04:18):

Right. It’s been, we first met a couple months back when I flew out to the little sleepy town of Denver, you know, where it came out to this incredible podcasting studio that you guys have got going on with Chris. And, uh, I just, I’m looking at it right now being very jealous. So you’re sitting in your really cool podcast studio. You’ve got like, it was at six or seven helpers in the background. You got an entourage of people. You’ve got your chin up, your chin up bar in there. You drink drinks all day. It’s pretty freaking awesome.

Terrance Doyle (04:48):

We have a team of ninjas they’re solving problems all day, creating content. Yeah, we’ve got a great team here. Diana Juul is per se. I mean, they’ve done an incredible job and it’s allowed us to put out some really cool content and hopefully add value to all of the real estate investors around the country.

Reed Goossens (05:05):

Awesome. Awesome. I will look, I am very envious of your set up there. And I remember when I first met you, I thought you and I connect on a different wavelength and we’re going to get into your story, but before we do, whereas we do, I’m going to ask you a question, like ask all my guests were on the clock and told me how you made your first ever dollar as a kid.

Terrance Doyle (05:24):

First dollar as a kid. You know, I’m from Des Moines, Iowa. Very for those of you that don’t know it’s a sleepy farm town, blue color, you know, the fundamentals of Des Moines is just very hardworking, very conservative and based on relationships. And, you know, the first dollar I ever made was mowing lawns in our neighborhood. I think I was cutting our grass, our neighbour’s grass and my grandparents, and a few of their neighbors. And that’s what my weekends look like. And I think I was getting $20 to $25 a lawn right now. I’m paying, you know, the team that does our lawn may be 30. So inflation has not really hit the lawn care business. And, uh, that was how I made my first dollar was mowing lawns with my dad,

Reed Goossens (06:06):

Midwest upbringing, right. You know, mowing lawns, lemonade stands, Popsicle stands the classic American dream, but your background is not necessarily from America, right? You’ve got a very similar story to myself. So maybe a cheering, the listeners into where you’re from and, and, and growing up in a, in a sort of immigrant household.

Terrance Doyle (06:23):

Yeah. Two immigrants doing a podcast talking about real estate. I grew up in Columbia, south America. My mom’s from Bogota. Uh, Bogota’s basically a third world version of New York city. So 10 plus million people driving all over the road, not a lot of traffic lights, not a lot of organization and sophistication. And I would spend half the year in Columbia, anywhere between three and eight months a year, I went to school there. I would spend summers there. I would shadow my grandfather who was into real estate, ironically enough, PE owned multiple apartment buildings and land and homes all around Bo Baton, the countryside there. And that was my upbringing. I was, you know, my mom, it was very important for her that I was, I was in my, my brothers and sisters. We were bilingual, you know, obviously academics in a third world country is super important.

Terrance Doyle (07:17):

That’s like the only way, the only chance anyone has a making it out is either being really good at a sport like soccer or golf, uh, cycling and academics. And so my mom was heavy, heavy into, into school. We were homeschooled into Moines and then I would spend, like I said, three to over half the year, uh, growing up from like maybe kindergarten all the way through sixth, seventh grade. The first time I went to school full-time was in ninth grade. And it was amazing. I mean, I didn’t know any different, uh, for those, the narco fans out there. I mean, this was like, you know, late eighties, early nineties, Pablo Escobar, you know, he’s running the country, going for president and doing all kinds of crazy stuff. And that was my childhood seeing that, and I never felt unsafe at one point. I loved it. I think the one thing that you and I could probably relate to is that, you know, I looked at the United States as like an incredible opportunity to live here, to grow up here and I that’s how I’ve always viewed it. And that’s probably, what’s giving me some of the perspective that you and I share of just looking at the country we live in is unlimited opportunity coming from a third world country where there’s very limited opportunity.

Reed Goossens (08:27):

Well, yeah, I obviously didn’t grow up in a third world country, so it’s got a little bit different. Your stories is cooler than mine, but, uh, but, but, but what was the, why were you going back and forth a lot as a kid? Was it just because your parents had, you know, obviously roots there?

Terrance Doyle (08:39):

Yeah. My mom just wanted me to learn Spanish and to spend time with my grandfather. And since I was homeschooled, I could basically go, you know, she would teach me half the year and then I was going to like a, an American, uh, prep school called El Camino, which means the path in Bogota. So it was like English and American, either missionary parents, or, you know, children that their parents were ambassadors or worked for the embassy or something like that in Bogota.

Reed Goossens (09:05):

Awesome, awesome stuff, man. Um, now, now bring us forward into what you’re doing today and maybe the journey along the path to the success you are and we’ll get into what you actually are doing today, but I know you’ve got some few interesting, um, Jerry McGuire stories up your sleeve. Um, do you wanna, do you wanna share it with it with the listeners?

Terrance Doyle (09:25):

Yeah, so I think the, the punchline is really, you know, the shortened version is that I’ve been an entrepreneur my whole life. I had the opportunity to play college basketball. So they basically paid me to sit on the bench and do everyone’s homework, keep them in compliance. So I, I had a chance to play college basketball. I was fortunate enough to have, you know, be on scholarship and have the majority of my schooling paid for. I ended up at Carter Christian university in Denver. Uh, two of my best friends and teammates ended up starting a company. And I was kind of like the third partner and I was just a junior senior in college. We’d actually started a basketball ministry, similar to athletes in action. And we were taking college basketball players to Europe and we’d put on basketball camps in the summer and be able to play basketball games at night against professional teams.

Terrance Doyle (10:12):

So things like Germany, Italy, Belgium, Czech Republic, we’d go into a city, um, like outside Berlin. And we would partner with the local, the local basketball club there. And they would put on games, uh, two or three games during the week. And then it gave like college basketball players, the opportunity to like showcase their talent and also share their faith. And that’s how we initially started. And then we wanted to start a business to fund that ministry. We didn’t want to, we, we felt like with our age and our ambition, we could start a business to fund it instead of having to ask for support. So that’s what we did. The first business was called Oxy fresh carpet cleaning. We started that in 2006, we franchised it and I was kind of working on the franchise development side. So every, every day I was basically on the phone with people that were looking to buy franchises.

Terrance Doyle (10:59):

So we had some success there. We were one of the fastest growing franchises in the carpet cleaning space, those first couple of years, two and 6, 7, 8. So we, you know, I was single, I was young. I was, you know, making some money and then 2007, eight hits. So the, the recession and one of my other college teammates came to me and said, Hey, we’re going to start buying foreclosures at the public trustee sale in Denver. I was one of his first investors. I remember we bought a house for maybe $56,000 and we sold it eight weeks later for 96. And I was like, oh my gosh, this is incredible. Uh, at the time I was a renter didn’t even understand real estate, but I knew the opportunity was great. And basically if you had cash back then you had unlimited opportunity. So in a recession, most people don’t even really remember what that’s like anymore, because there’s so much liquidity and so much opportunity, but basically unlimited opportunity at the public trustee sale at the auction and very few dollars chasing those opportunities.

Terrance Doyle (11:52):

And as the recession dwindled, there became less and less opportunity and more and more liquidity. But initially there was very little liquidity and a lot of opportunity. And so we were in the ground floor of that. And we started doing anywhere from 80 to 100 flips a year, 2008 to 2014. And then, so that was, that was basically what, what made money? I left Oxy fresh and started, you know, two of my best friends played in the NBA and I looked at them and was like, guys, I think that this market is really underserved. If someone young that has kind of a business mindset, more of an entrepreneur and that could help advise them in other business opportunities. And at the same time help negotiate their plane and marketing contracts. So I started that company in 2009, I merged with a group out of Europe that was basically bringing most of the European and the French basketball players to the NBA and had a great run at that ended up buying a, actually a basketball team in Spain through that, I came with some real estate in 2012 and then, uh, 2014, I got engaged and through a series of events was basically like, you know, sports is great.

Terrance Doyle (12:57):

I made a bunch of relationships, uh, learned some valuable skills, but wanted something more stable travel less. So I could have a healthier relationship, uh, and family, family dynamic. And so basically moved back to Denver full-time was engaged and started my own real estate company. So at that point, foreclosures had basically dried up and you really had to get creative on how to find deals. And at this point there was a lot of liquidity chasing just a fewer number of opportunities. And that’s when I branched off, started my own company and kind of what today is, you know, come the, uh, the value add real estate company.

Reed Goossens (13:31):

That’s awesome. That’s an incredible story. Basketball team in Spain. What what was that all about?

Terrance Doyle (13:36):

It was called Balon cysto saviah, and it was basically the professional team in Sylvia, Spain. And for those of you that have been to Spain had been to the south of Spain, it’s like the, maybe orange county meets Miami of Spain. It’s a lot of fun. Uh, they have a soccer team there, two soccer teams that play in LA Liga, and it’s an incredible, it’s an incredible part of the world. Obviously, Spain, as much in the United States, we had some difficulty there with our business model, and we ended up having to sell the team in 2014, but it was incredible experience learned a ton. And yeah, I mean, putting that deal together was maybe one of the more fun transactions that I’ve been a part of. And, but I can tell you that, uh, real estate much more lucrative, obviously owning a sports team is very sexy, more of a vanity play, a cashflow much better in real estate. So I’ll pick real estate.

Reed Goossens (14:26):

I was going to ask you though, I was like, does it actually make any money teams? I go see, you know, all the big teams around the world, you know, do these things actually make money, maybe they don’t.

Terrance Doyle (14:34):

Well, our, our business model just, you know, for those soccer fans out our business model was to take young American players that did not want to go to college. So think like the Kentucky of overseas, and we would sign them for two or three-year contracts and have a really big buyout. So we would develop them just like soccer and have a big buyout. So in the end, when they were ready to go to the NBA, the NBA would draft them and then pay us a multi-million dollar buyout. So we would get that was, is our teams don’t make money in Europe. A lot of them struggled why, which is why we are able to buy this one for pennies on the dollar during the recession. But our model was signed to top American players that don’t want to go to college, to develop them, train them on how to be pros.

Terrance Doyle (15:12):

And then when they were ready to use in Spain. Exactly. So they get to play against professional competition and really work on their strengths. We’re going to bodily and we thought play against better competition, prepare them for the NBA better, and, you know, provide strength training. And, you know, they’re like professional basketball players by the age of 17 or 18 versus waiting two or three years here in the NBA here in the United States. And, you know, I, I ultimately this, the Spanish government and the ACB, which is what the, the name of the league is called, did not want the turn, their, their league and do a and to a minor league for the NBA and a developmentally for the NBA. But we had a great model. We had some really top talented players in the United States teed up to come over. Um, but it just wasn’t, we weren’t able to execute on that for some things outside of our control, but I’m still a big fan of actually to, you know, a little background on what, what ended up happening is a lot of those players ended up signing in Australia, which is this same model.

Terrance Doyle (16:07):

And then they came to the NBA after they played in Australia. So Australia just had maybe a little bit different of a season, um, maybe not as difficult to enter. And so a lot of those players have gone to Australia, played one or two years, and they can come to the NBA and done the exact same model that we had teed up in Spain.

Reed Goossens (16:24):

The M it’s called the MBL for those listeners who are in the national basketball league yet is what a lot of Americans down, down under. Like, I remember the Townsville crocodiles, they got some wheat, like the Sydney Kings is all, there’s a bunch of

Terrance Doyle (16:36):

Has been hesitate. You got some really, really big tablets, the bullets that’s. Right, right. Yeah. So that was it. I mean, I had an amazing experience. I mean, one of the highlights of that was, you know, one of my clients was really close with Coby and we were in the gym a year after they lost the finals. And I remember watching Koby terrain and just his focus on fundamental. So a lot of the things that I observed and learned experience as being a sports agent, I’ve been able to transition into real estate, that it was an incredible journey and so many amazing memories and pictures to, uh, to carry forward.

Reed Goossens (17:06):

That’s awesome, dude, that sounds like a really incredible story. That’s a thank you for sharing that with us. I’ve never had anyone on, on the podcast tell me that they bought a basketball team before. So regardless if they’re professional or not, I think that still is fricking super cool, so awesome stuff. But now transitioning into real estate, what has been, what are you doing today? Let’s maybe bring this up to speed. I mentioned earlier that you’re about $80 million of assets under management, but I also know personally, you’ve got some pretty big deals going on on the side and you’re graduating into a fund model. Um, so share us what what’s, what’s going on your world these days.

Terrance Doyle (17:40):

Yeah. So I started out just doing deals with my own capital, and then I brought on a buddy from college. That was really good. I think part of it is just being self-aware, you know, understanding my strengths. And so since I was an entrepreneur since 2006, by 2014, I’d clearly identified, here are the two or three things I’m really, really good at here are the things I’m not good at. And I was able to hire a partner with people that were strong in areas I was not. So I think that’s one of the, one of my big takeaways whenever I’m talking to earlier stage investors or people trying to get in is, you know, number one is just be, self-aware understand what your strengths are from day one. And then either hire a partner with people that are strong. And so my business partner was one of my best friends from college.

Terrance Doyle (18:18):

He was an analyst, very analytical. He ran the bookkeeping, accounting, legal insurance, all the back office stuff. So I knew how to, you know, I knew I had the relationships and I knew how to put deals together. I don’t know how to source deals oversee the construction of the capital stack. I spoke fluent Spanish. So one of my early on strengths and the ways that we separate ourselves was we could basically take on any construction project that most other people were scared to do because I had my own set of crews just from being all speak Spanish. So framing, drywall, paint, flooring, roofs, windows. I mean, I had the top subs in Denver that would work for me and just that was scalable. They would do the same thing on every project. So I was not an artist. I was not trying to like have the sexiest building on the street.

Terrance Doyle (19:03):

I was just having, trying to have the most profitable, lowest basis, you know, building on the street that would cashflow. And so start out flipping some homes quickly realize that for me to scale, I needed to be able to do more doors in one location. Right. So if you think about doing 30 projects at once 30 single family homes, all over the city of Denver, you know, driving around, it was just a nightmare. So I was like, why don’t I just buy a 10 or 20 unit building? So I can have my crews on one in one location, one address and do 10 bathrooms, 10 bedrooms, you know, you know, one roof all at one time. And that’s really was the Genesis early on. My underwriting was pretty simple, was every a hundred dollars. I can raise a rent at a six cap where $20,000 per unit in value.

Terrance Doyle (19:51):

So, you know, from flipping, you know, I was looking at how much I’m going to make per house, and this was how much you’re going to make per door for every a hundred dollars I can raise rent. And that was really back of the napkin. So I wasn’t able to take the skill that I had learned from flipping houses, which was you had to move really fast with cash. And I was able to take that into sourcing multifamily off market and be able to underwrite really quickly and make offers extremely quickly get through due diligence. And that was really our advantage was we had in-house construction and I could make offers and move faster than my competition so quickly. And so I was basically buying 4 unit to 20 unit deals in Denver, and I would clear the building renovate all the same, fill it.

Terrance Doyle (20:32):

And then because debt was going down, rents were increasing so quickly and den, I had basically effectively doubled my equity. So I was selling these buildings every 12 to 16 months. And then I was taking that capital and buying de Moines, Iowa. So my brother at the time was a college basketball coach. He wanted to move back to Des Moines, be close to family, our family, and then start having children with his wife. And so him and I basically bootstrapped a property management company because we quickly got to like a hundred doors there. So if you can think I was selling Denver at like 150 a door, and I was buying in Des Moines at like 20 a door, $20,000 per door. And the rents were like 600. So Des Moines at the time was like a secondary market, not a lot of institutional capital chasing it.

Terrance Doyle (21:15):

And that was really the Genesis of the company is I was selling Denver, buying the Moines and I quickly put together three or 400 doors into Moines that we were managing. We really had to figure out property management, which is another pillar of our business today. And then by 2019, my then business partner had basically coming to me and said, look, we’ve done super well. I want to spend more time on the golf course, less time in the office underwriting and managing all these details because at the time that we had maybe four or 500 doors, just him and I and my brother. And so at that point, I had to think about, okay, how am I going to scale by replacing a partner that basically were like 10 hats, 10 roles in the company and what am I going to do? And that was the first time I started raising outside capital is basically 2000, 19 and 20.

Terrance Doyle (21:59):

And so since 2000, 19 and 20, you know, outside of my personal portfolio, we’ve raised somewhere around $30 million in equity and done over a hundred million dollars in deals, basically bought and sold. We have over a hundred million under contract right now, but obviously we’re buying selling and that whole thing. So yeah, I mean, we’ve had an epic run and, and I, in my mind, we’re still just getting started. I mean, you know, like I look at guys like you that have put together massive portfolio that had a much longer trajectory raising outside capital because I was really just playing with my own capital. My partners, I’m just really in early stages of raising outside capital. And so this last year we were raised a fund. We have somewhat somewhere around $20 million of equity committed. And basically every time we do a deal, we just call a portion of that capital that’s been committed. So that’s, that’s where we’re at today is, you know, we have our own construction company, have our own property management company and then our own asset management company where we’re managing the capital from the fund that we have raised.

Reed Goossens (22:58):

That’s super impressive. And I don’t think you should touch, sell yourself short because what you have done is credit value through learning it very lean, right? It was you, your brother and your business partner. And I think that’s, you got to tip your hat to that because that’s what makes you valuable equity will chase you once you’ve set up those systems. And I think that’s what people want to invest in is when you are an inch wide and a mile deep in a certain market, you know, the relationships you have, all the subs, you can grind it down to being really a good cost basis. You’re going to go out and find gyms that other people just don’t. And I remember when I was talking to Chris, uh, your podcast, co-host about, you know, planning deals in Denver as an outsider. It’s going to be hard for me to come in and do that, right. You’ve just got some different relationships. And so much capital wants to be in Denver right now, and probably even de Moines that you can help place it. So I think you’ve set the foundations up extremely well and kudos to you.

Speaker 2 (23:57):

[inaudible]

Reed Goossens (23:58):

For those of you that are interested in staying up to date with all the latest happenings in my business, or to learn more about passively investing directly into my multi-family value-add deals, then head over to [inaudible] dot com and sign up for my monthly newsletter by signing up, you’ll automatically be notified about my new up-and-coming investment opportunities. You’ll be able to stay up to date with all the latest real estate news here in the United States, and much, much more. So head over to Reedgoossens.com and sign up today now back into the show, But tell me, how are you transitioning now? What’s been the mindset shift to start attracting that outside capital. Uh, and what size deals are you doing now? Cause you mentioned earlier, you’re doing, you know, 10, 20 unit or 10 20 units. Now I, it sounds like you’re probably scaling that up. And how are you finding deals?

Terrance Doyle (24:50):

Yeah. Power pack list of questions there. I’ll try and answer one at a time. So we are targeting a hundred plus your unit deals. So, you know, some of the best deals I’ve done with my own personal capital is buying a hundred plus unit buildings where, you know, as opposed to like a 20 unit building, I can put full-time maintenance, full-time leasing onsite. Now we’ve built kind of our own proprietary system for how we do maintenance and leasing, but I have to have the scale in order to support full-time help on those buildings. So we’re really targeting a hundred plus unit building. So currently in Denver, we have a 280 unit deal under contract in a suburb called Arvada. It’ll be in my opinion, one of the biggest and best deals that I’ve done to date, it’s a $64 million purchase with $4 million of construction. So after closing costs, everything, it’s roughly a $70 million, uh, total capital, uh, project.

Terrance Doyle (25:40):

And then we have a couple other like 20 and 30 unit and 70 unit buildings that are just in strategic areas. So if anyone knows Denver cherry Creek is like the, maybe the Beverly Hills of Denver, it’s where all the, you know, wealth and jobs and businesses and cool restaurants and bars. So we have a 20 unit like right in the heart of cherry Creek, we have a 70 unit that we’re doing right in the heart of downtown, an area called five points. And so, you know, I’m trying to pick off like really strategic value add building. So our core really is using construction and property management as an advantage, right? And we find ways to lower expenses drive NOI using both of those, you know, systems and businesses that we’ve set up. And then in Des Moines, you know, we’re trying to buy a hundred, 200, 300 unit buildings just like we’ve been doing for the past three or four years.

Terrance Doyle (26:29):

And naturally because of our reputation and track record, you know, our advantage to the market is that we know the top brokers. We know who the families are that are selling, and we’re able to move faster and stay ahead of the information curve, you know, before, uh, companies, you know, from outside that are chasing down, drives like Denver, like Austin, like Nashville, Dallas, super hot there at the top of everyone’s list. Phoenix is there, you know, everyone that’s in multi-family and has a fund, or has an institutional type, a company set up is looking to buy in those areas. And so that’s really, our advantage is we may not have the systems and maybe the experience and a track record those companies have, but we’re boots on the ground. We have relationships and we trade off of, off of those. So I believe I answered the questions is like we’re buying Denver, Des Moines a little bit larger.

Terrance Doyle (27:14):

And, you know, from a capital raising perspective, I don’t really spend a lot of time on that. I focus on deals and executing at my core. I’m really more of a builder. I love, you know, the details and the nuances and the min utia that come along with, you know, sourcing the deal, putting together the business plan and executing that I spend very little, almost no time raising capital, you know, there’s members of my team that spend time on that. And then essentially what happens is they come into my office, they sit down, I hear about what they’re looking for, what their problems are in their personal lives or in their family’s lives. And then I show them what our business is about. And if it’s, if it’s a solution to the problem that they are experiencing, typically what we see is a lot of these wealthier families have a problem with cashflow and yield. A lot of liquidity, not very much yield in today’s market. And we were able to solve for yield, yield and risk adjusted a multiple on their capital. Yup.

Reed Goossens (28:11):

And how many of your ex professional basketball friends are involved in this deals right now?

Terrance Doyle (28:16):

I don’t have any athletes in our phone lately. Yeah. Wow. That’s interesting. Yeah. You’d think no, I have, we haven’t raised any money. People think like, oh man, you’re on social media, you must raise a lot of money from social media and your former clients. We haven’t raised any money from social media or our clients. What social media has done is it’s helped us with lenders. Lenders tend to get very aggressive because they view us as a thought leader in the space. So they view it as like less risky to, you know, fund and be the senior lender on deals that we do. And then sellers it’s really helped us with credibility. Like the deal that we put under contract that was off market in Denver, 280 units, you know, the seller was able to look us up our company myself, and really got comfortable with who we were.

Terrance Doyle (28:59):

And so that’s, what’s helped, but I haven’t, you know, athletes are very particular. A lot of athletes actually don’t save that much money. They really don’t understand the value proposition. Our profile is, you know, an seven or eight or nine figure family or individual or family office that understands Dan Bern, Des Moines, and really appreciates our ability for speed because you know, we’re speed is our greatest strength. And so with speed comes some chaos. And so people have to understand that while we may not produce like monthly or weekly reporting, like a larger company like that we would be competing with, we produce disproportionate risk adjusted returns. So that’s really the profile. And those people are not on social media and those people are typically athletes.

Reed Goossens (29:46):

Yeup. No. Got it. And how did you find the 288 units? Because off market Denver, it’s hot. It’s hot right there. It’s hot. Like he’s mentioned for Phoenix. I asked, asked him, Austin, Nashville, Orlando, all these markets are blowing up. How did you find the off-market deal? It sounds like an absolute gym,

Terrance Doyle (30:01):

Just relationships, you know, uh, he had the gentleman that owns it has owned it since 1975. He was in the middle of between deciding to refinance or sell. He owned it with a family trust out of Hawaii. The trustees were elderly and kind of in the fourth quarter of their lives, they had 12 children behind them. And so the, the managing partner was basically looking at at the asset, like, do I really want to answer to these 12 children? Or should I refinance? Or, you know, I sell and I, the lender that he was looking to refinance with made one phone call to a buddy of mine, that buddy called me and said, Hey, if we, if you write on this really quick, he might be willing to sell instead of refinance. So I looked at it actually, July 5th wrote an offer, July 7th, I went hard on half a million dollars on my own capital, July 9th.

Terrance Doyle (30:49):

And we basically wrote the contract on the back of a napkin and he didn’t want to deal with attorney. You know, he was later on in his life. Didn’t want to deal with attorneys. Didn’t want to deal with a bunch of different people. Just want to deal directly with someone local that he could trust. They could verify they had the money and would move quickly and make it convenient. And that’s typically what we’re buying is legacy owners and markets where we know that can make one or two phone calls and verify we are who we say we are, and there’s not going to be any ref RAF. And, you know, we’re typically trading price for convenience and speed, right? And so that’s what we were able to do there. And that’s typically what we do on every deal is we can just get in before anyone else knows about it and trade convenience for price,

Reed Goossens (31:27):

Where, uh, when he closing

Terrance Doyle (31:29):

September 30th and that’s a hard date we’ve been spending, you know, we’re full. If we just actually got the senior debt piece, locked in, uh, we’re, you know, ordered appraisal a few days ago. And so, yeah, probably by the time this airs, we will have closed on it and be in full construction and property management mode.

Reed Goossens (31:50):

That’s you, you guys are taking the property management as well.

Terrance Doyle (31:53):

That’s right. So I think one of the big things that I’ve learned personally is with my own capital, I’ve lost multiple six figures, trusting third party management. Now this is with like 20, 30, 40 50 unit buildings. And just by not really being by not having aligned in interest, right, is that they can see doesn’t hurt them as much as it hurts me. They love Lisa up. They love renewal fees. They love fees. I hate fees, right? And so was me being sometimes the largest investor in our deals. I’m looking into lower construction, de-risk the asset and lower vacancy and fees as much as possible. And so I, you know, through, through the pain of losing money from third parties basically built my brother and I built our own property management company. And so we’ve got incredible, I believe talent on our property management side with leasing maintenance and just the back office, a property manager, really underwriting each lease, understanding the system behind maintenance.

Terrance Doyle (32:49):

That’s really going to drive renewals and understanding how to do proper background checks. So we get the right people into the properties as, as you probably know, I mean, they can see is the number one killer of NOI and S so, you know, we want to drive occupancy and we want to make sure that when people, we get people in, they’re going to stay and that’s, I think the best way to do that is to control it. You know, third parties can be good. And I know a lot of successful operators around the country that hire third parties and they’ve crushed it. That’s just not my experience. Right. As anytime I’ve hired, third parties has been painful. And so we had to build our own basically to protect our own assets.

Reed Goossens (33:28):

It’s good. It’s good advice. But it’s also a lot of people like people in myself, I don’t, I don’t do third. I do third party. I don’t bring it in house and we’ve always tossed around whether we should do it or not, but it’s always, it’s like, you have a high job problem, right. It’s your HR company at that point and you don’t make it a ton of money. You’re really just reducing your expenses, which is, uh, which is still very, very vital because I also agree that I was literally on one phone call today with my San Antonio team. And they just, oh, we’re over on the monthly fees because apparently you hit collection. Right. You know, like, isn’t that your job? So yeah, no, I, I, you I’m pivoting now into the fund because I think when I met you in Denver a couple months ago, you were either just starting or you’re bringing someone on to help you start the fund. So for those people out there who are curious about how to start a fund, what’s been the experience like for you, you know, starting something from scratch like that.

Terrance Doyle (34:19):

So again, like back to my original statement, like that’s not my strength. So I brought on a strategic partner that had an institutional background. His background was from Morgan Stanley. He was on the private equity and hedge fund side at Morgan Stanley spent 25 years. There was kind of in a later season in life and was looking for something that was more fulfilling. And him and I just started out as like a mentor mentee relationship. And I’ve known him for now four or five years. And so it was really his idea. He said, look, I love your business model. What you really need is programmatic capital. So you can focus on your strengths, sourcing deals and executing construction, and you just have capital there to execute on the opportunity you find. And so, you know, we, he, you know, brought him on, he’s a partner in the fund.

Terrance Doyle (35:03):

And then another gentleman that’s in private equity, again, very institutional, very seasoned. And so it was really their idea and their baby and they really run with it. I obviously have to oversee it and I’m the majority of the GP. And so I have to sign off and understand enough to be dangerous, but really that’s not my strong suit. That’s not my area of expertise. You know, my area of expertise is really sourcing opportunity, executing the business model and overseeing property management and construction for the company. But yeah, my experience has been great. I mean, I’ve, I’ve met some really interesting people. I mean, some of our investors have been ultra successful in, you know, either wall street or private equity or a stock market. And they’re looking for diversification, they’re looking for cashflow. And that’s obviously what my whole life has been about is I know how to invest money in real estate in these particular two markets.

Terrance Doyle (35:53):

And that’s it. I stay in my lane. I’m not looking to do ground up construction or anything outside of multifamily. I just am focused on that. And so, you know, individuals and families that have been interested in that, that are in Denver, you know, it’s been a really good fit, but, uh, you know, essentially, you know, we had to come up with the operating agreement and come up with the, you know, the limited partner agreement and the LPA and, you know, a lot of legal fees. I believe the legal docs were like 40 to $50,000. Well-worth it basically spells out everything that happens. If things go wrong. I believe Gary Keller, you know, talked about opera agreements. It’s more of like a disagreement, like when things go bad and if something were to happen to me, what are the next steps? And how does that get solved and how are the investors protected?

Terrance Doyle (36:39):

And I am one of the investors and, and I, you know, we typically put in between 10 and 25% of the capital in every deal. And so it protects me, my family as well, but essentially, I mean, it’s been great is, has been the experience so far, but we’re still really early on. And, uh, I’m trading basically some control to have programmatic capital. And that’s essentially the punchline for any syndicator out there is, you know, we have a life of the fund. It’s basically seven years with two one-year extensions and there’s a bunch of things that I can do and they can do, uh, to basically protect both of us. But I would say that anyone looking to get involved, you know, it’s, it’s great. If you want programmatic capital, you just have to be willing to give up some control and to have a limited life cycle for the deals.

Reed Goossens (37:20):

And did you was enough of a track record that you distinguished over time to attract that capital? Because I hear all the time, like people got too soon with the fund and be like, I’m going to try and raise a fund in a crickets because they just don’t have enough track record. Was that, was that, uh, clearly not an issue for you, but was that something that came across the table as like, this could be a,

Terrance Doyle (37:42):

You just have to know who your audience is. So institutions are looking for fund two or three, so like really sophisticated institutional capital. So like the pension fund, and California’s never going to invest in fund one. Right, right. They’re going to invest in fund four or five once there’s multiple years of audited financials and a track record. But you know, the family office in cherry Creek would, would potentially look at it because they could understand where we’re at and they understand they’re going to get disproportionate returns in exchange for being fund one. So I think you have to really know your audience know who you’re going after, but yes. I mean, absolutely. There’s been investors that have said, Hey, you’re too early stage and you don’t have a seasoned enough track record. In my, in my mind, I have plenty of a track record. I’ve been doing real estate since 2008 and then buying multi-family since 2015.

Terrance Doyle (38:26):

So there’s plenty of track record. It just depends on who your audience is and them understanding they’re going to trade some experience and sophistication from the reporting side in exchange for some disproportionate risk adjusted returns. Got it. So some in more institutional like advanced companies, maybe aren’t going to return what we can return, but they’re going to give them and make them feel warm and fuzzy and give them the, give them all the audit to financial, show them a track record and show them really clean financials every month. And with us, you’re probably not going to get that every month it’s going to be quarterly, but you’re going to get some deals that an institution wouldn’t be able to move fast enough to do. So it’s a give and take for the investors as well.

Reed Goossens (39:03):

No, I love it. And then it’s such a, I think you’ve fit this, the peg into the right hole. So it’s a square peg for a square hole around round pad for a round hole. And you’ve just understood your, your one, your product, what you’re selling into who you’re going out and marketing to. So it’s a really, really important, um, so it brings us sort of towards the end of the show here. And what is what’s, what does the future hold for you with the funds that you trying to do multiple funds, um, is this is this 288 units, just the only deal on the fund. You’re gonna try and go out and find some more, what’s the sort of, uh, what’s the horizon hold.

Terrance Doyle (39:35):

So part of the deal with the fund is that it’s going to be diversified. So the fund SF six or seven or eight deals in it. So the fund can only invest up to 20% of the total allocation. So roughly $4 million per deal. So we’re actually doing a co-investment slides where I think we’re raising 17 million for that deal. We have all of the committed, but so then we had to do a co-invest and then we actually had a couple of 10 31. So tick tenants in common that came into round it out. Uh, so the fund has a current deal in Des Moines, 108 units that we purchased in, uh, April or may has a 20 unit that we’re doing in cherry Creek. It has this 280 unit deal. And then it’s going to have probably one or two other deals in de Moines and then maybe one other deal in Denver and that’ll be the fund.

Terrance Doyle (40:18):

And, you know, I think, you know, my goal is, you know, we’re going to, I’m going to execute on the phone. I’m going to do the best I can to drive returns and lower risk for that set of investors. And then just see kind of where we’re at my goal isn’t to do maybe multiple funds. I want to see what it’s like. I may go back to syndicating individual deals because on that I can really control LPs are and the life cycle of the deal. Like there’s some assets like, you know, re there’s some assets that it’s like, man, I want to hold this forever. And I really only want three or four partners in it. There’s other assets. It’s like, you know, we’re going to flip this really quickly. So the fund has some pros and cons. I’m going to do the best I can to deliver the best returns.

Terrance Doyle (40:54):

And then kind of see where we’re at. It’s kind of too early to say what I, what my goals are, but, you know, I, I’m an investor at heart. I just want to own great real estate with gay people and be able to make decisions on what to do asset, you know, over the course of time. I don’t want to have to commit to something too early. Cause you never know assets. You think they’re going to kill it. Maybe something ends up happening with a building. You didn’t realize through that area or maybe the neighbor sells to someone you didn’t. There’s so many factors on every deal. And so having optionality I think is really key, but I love what I’m doing. I really enjoy, you know, the, the, the current season that we’re in, which is just like hiring really talented people around this opportunity to build wealth in multi-family and then see where we go. And, and that’s, that’s kind of where I’m where we’re at right now.

Reed Goossens (41:42):

That’s awesome, man. I, I w I wish you all the best, um, is a fun closed, or are you still open for investors at this point?

Terrance Doyle (41:50):

Close it at the end of September. Goodness, we’re gonna close the in September. So after we close this deal, we’re, we’re probably gonna shut it down and we’ll call that fund one, and then we’re gonna going to go out and execute the business plan and then, uh, you know, kind of, uh, analyze, you know, where we’re at and, and, and look at it next summer or

Reed Goossens (42:07):

Awesome. Love it, man. Love it. Well, but at the end of every show, we like to dive into the top of five investing dips, ready to get into it. Yeah, absolutely. Mate, what is the daily habit that you practice to keep on track towards your goals?

Terrance Doyle (42:19):

I don’t know that I have a daily habit. I mean, every morning I wake up, I spend time with my son. I take a cold shower and I have a to-do list that day that I’m like, if I get, you know, I think one of the things is just, if I get these two things done today, it’s a win. You know, I think so many people get bogged down with all these details. And for me, it’s really like one or two things today and I won the day. Uh, but those, those are basically, you know, kind of my routine. Um, I think one of the big things for me is like I talked about earlier, I was just being, self-aware understanding my strengths and I understand my strengths is not details is not really like output, you know, like the value I add to my company and my investors is not like a great work output, but, um, I’m really driven by relationships and opportunity. And I, uh, people around me that deliver great output around me, you know, and some that are really focused on, like, I got to get this report done, I gotta get this Excel spreadsheet. Like I have people around me that do great work and I’m focused on creating opportunity and bringing people together.

Reed Goossens (43:17):

That’s awesome. I think that’s being very self-aware is important in how to grow any single business. A question or two is who’s been the most influential person in your career to date.

Terrance Doyle (43:27):

And what’s interesting is every season of my life, I’ve had incredible mentors. And right now, you know, I have two mentors that are my partners, and they’ve just been ultra successful from an investing standpoint. They would call themselves as more like asset managers, more than investors. Like I would consider myself, like, I understand how to do one thing in real estate. And so people trust me with that, but there’s people that sit above that they’re really asset managers that understand systems and process and care for capital and the systems around that. And those, those two gentlemen are really my most important mentors to date. I think, you know, my grandfather that was in south America was obviously a great mentor. You know, he was ultra successful coming from a third world country and being able to build what he built. So my father-in-law, uh, has been ultra successful in sports. And so he’s, he’s another mentor of mine, but yeah, I’ve been really fortunate that every season of life I’ve been able to partner and have really great people around me.

Reed Goossens (44:21):

Awesome. Awesome. Uh, question three is what is the most influential tool in your business? When I say tool as it is, it could be a physical tool, like a notebook or a phone, or it could be a piece of software that you can’t run your business without. What is it?

Terrance Doyle (44:34):

Let’s say Google docs. I mean, I’m in Google docs every day and that’s kind of, I mean, that’s probably like from 1990s, but that’s really what I used. Like I said, I’m not really a work guy. I’m an opportunity guy, but, um, yeah, I use Google docs a lot. So without Google docs, I’d probably be in a lot of pain and people listening to that are probably cringing.

Reed Goossens (44:52):

Well, the question before is in one sentence, what’s been the biggest failure or lesson that you’ve learnt in your career. And what’d you take away from, from that failure or lesson

Terrance Doyle (45:01):

2012? One of my top clients in the NBA fired me and, uh, man, it was really, really painful. We had built a really strong relationship. We had done so many big deals together and made a ton of money together. And I really thought like that was the one client that would never fire me. And I learned a ton and that’s when I really started to think about, you know, what is the next season of my life look like? Don’t want to have a wife and kids and be dependent on one person for like half or a large portion of my income. That’s really what drove me to want to build real estate and build something on my own and not really depend on other people. One of my favorite Kobe Bryant quotes is just always bet on yourself, always bet on yourself. And that really hit home for me is I don’t really want to depend on other people as much as possible.

Terrance Doyle (45:49):

And that’s really been fundamental, you know, a mindset shift and you’re always gonna have to depend on people, but like as little as possible. And that’s one of the things I like about real estate is you’re really betting on yourself, you know, can you execute? Can you underwrite? And, uh, you know, a building’s going to be there. Um, and, uh, so it can’t like a building can never fire me type type mentality. Right? And so that’s kind of been, I think, one of the big pivotal learning lessons of my life. And I think that I’ve had, you know, I think being an entrepreneur reading, you can probably relate to this. I’ve had so many failures. I mean, every single week I have failures, you know, things that I try or test or I’m brainstorming and that don’t work. And, you know, just looking at failure as, Hey, that’s just a learning lesson for me or something that’s gon na motivate me or teach me. And like I said, I’ve lost a bunch of money in construction, just trusting the wrong people. And then that’s only like helped me refine the process. A lot of money has been lost in property management helped me refine the process to be where I’m at today. And so now I’m going to have more failures and I think that’s just going to help me learn and prepare me more for the future.

Reed Goossens (46:51):

Love it. Absolutely love it, mate. And last question for you is where can people reach you to continue the conversation they want to be in your sphere? Where do they go?

Terrance Doyle (47:00):

I think Instagram or LinkedIn, you know, I’m, I’m pretty active on social media. You know, my cell phone, I’m on my phone all the time. So a lot of people text me. I don’t always respond to every text, but you know, my cell phone, if someone’s pretty crafty and they add value, I’ll respond to text messages. But text message social media. I’m pretty active,

Reed Goossens (47:19):

Awesome stuff, man. Well, look, I want to thank you so much for jumping on the shutter. I want to take a, you know, reflect some of the things that I took away from today’s show. I think the biggest thing is your resilience to go out and probably the last statement you made bet on yourself, but you’ve done it through multiple different avenues in your career. Went off to Spain to start, uh, you know, buy basketball league, you know, by basketball team to try and create talent. You sought, you’ve seen opportunities where others may not have and that’s, and you’ve, you’ve gone and bet on yourself. And I think that takes a lot of balls. It takes a lot of, you know, spine and, and because you’re not worried about the failure, you’ll just worried about the curiosity of going out and doing something. Uh, I think that was probably the biggest thing I took away from today. And I think as your evolving as an entrepreneur, you are finding new ways to create value for others in different systems that you’re creating. And then the last thing I think was understanding your strengths, you know, where you’re, you’re, you’re strong, you know, where you’re weak and then plugging those holes with really, really good people. So, um, I think there were a couple of, some of the lessons I took away live into the out

Terrance Doyle (48:21):

I read. That’s a great summary and Hey, look, I’m a big fan of you. I’ve loved your energy. I love your passion. I love the background you have coming from Australia and your story in New York. So I just love what you’re doing. I’m a big fan and anything I can ever do to be a part of what you’re doing, man. I’m all in.

Reed Goossens (48:36):

Awesome, Emily. I appreciate it. And back at ya, um, I’ll, I’ll let you go, but, uh, enjoy the rest of your weekend. We’ll catch up very, very soon. Thanks for reading. Well, they have another cracking episode jampacked with some incredible advice from Terrance. And if you do like what Terrance has got going on, please reach out to him at Terrance Doyle on LinkedIn or on Instagram. He is very active on those two platforms. He is an incredible wealth of knowledge. If you want to dive into the Denver market, uh, and you know, really understand what he is doing with his fund and his teams and his systems, super intelligent guy. And he’s just out there getting things done. I want to thank you all again for taking some time out of your day to, in, to continue to grow your financial IQ, because that’s what we’re all about here on the show. And if you want to invest with me the easiest way to find out what I’m doing is jump over to my website. Jump over, reduces.com, hit the invest with read button. And you’re going to find out more about all the deals that I’m doing in today’s economy and in today’s environment. I guys, we’re going to do this all again. Next weeks. Remember be bold, be brave and go give life a crack.