RG 325 – The Challenges of Investing in Assisted Living Facilities with Prashant Kumar
It’s always interesting to hear how other ex-pats built their empires here in the US. Let’s hear how Prashant Kumar, a fellow ex-pat investor, found success in real estate after leaving his corporate job.
Prashant is the CEO and President of MyRealtyGains Management, a real estate investment firm that helps aspiring investors find hassle-free opportunities to achieve financial freedom through passive investing.
Before he started managing millions of dollars in assets, Prashant was like so many of us. He worked a day job in the corporate world, clocking in 40 to 60 hours weekly, until he found a way to make his money work for him.
In this week’s episode, Prashant walks us through his transition from his day job to real estate investing. We also go into detail about the assets he invested in, including hotels and assisted living facilities, as well as his specific strategies for investing in these properties.
Whether you need another inspiring story from a fellow ex-pat or are interested in investing in assisted living facilities, our talk with Prashant is one you wouldn’t want to miss.
One of the scariest things about leaving your day job for a business is not receiving your next paycheck.
It’s not too late to start a new venture; some entrepreneurs become successful despite starting in their 40s.
Connections are one of the essential factors in managing and marketing assisted living facilities.
- When looking for and choosing properties, having consultants to analyze the data for you is paramount to success.
Be Bold, Be Brave and Go Give Life a Crack!
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Reed Goossens (00:00):
Good day good day 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 multi-family 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 reedgoossens.com to find out more that’s reedgoossens.com. Now back into the show.
Prashant Kumar (00:39):
Now, you know, that 1100 is my demand. And I, then we will look at within those five mile radi, how much is the supply? How many, how many existing facilities are there? Um, in my case, and I just really gave you the numbers. Um, in my case, you know, my, my, uh, my supplies only 115 beds, wow. Existing supply. So even if I add another 150 units, my supply, my demand still remains the four times the supply
Speaker 3 (01:17):
Speaker 4 (01:18):
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 (01:37):
Good day good day, ladies and gentlemen, and welcome to another cracking edition of investing in the us podcast from Los Angeles. I’m your host reed goossenss 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 their businesses here in the us, how they’ve created financial freedom, massive amounts of cash flow, and ultimately created 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 (02:24):
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 bots. 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 wherever you podcast on iTunes, SoundCloud, Stitcher, and Google play, but you can also find these episodes up on my YouTube channel. So head over to reedgoossens.com, Click on the video link, and it’ll take you to the video recordings of these podcasts. You can see my ugly mug, but the, the beautiful faces of my guests each and every week. All right, enough outta me, let’s get cracking and into today’s show.
Reed Goossens (03:10):
Dan’s show are the pleasure of speaking with Prashant Kumar. Now, Prashant is the owner of My Realty Gains, which helps assist busy professionals to invest in grade a real estate investment opportunities and provide stable cash flow returns and long term appreciation. He has acquired and managed over 32 million worth of real estate. He has his own podcast. He own webinars his own platform, and he’s also an expat like myself. So I’m really pumped and excited to have him on the show today to share. He’s incredible insight in knowledge about building something from scratch here in the us, but enough me let’s get him out here. Good day Prashant. Welcome to the show. How doing today, mate?
Prashant Kumar (03:46):
Hey, Reed thank you so much for inviting me. I appreciate you taking the time and interviewing me. Um, I’m here. You know, you asked me any questions, what you want and, um, you know, uh, thanks for the great introduction.
Reed Goossens (03:58):
My pleasure, my friend. Well, look, this show is all about getting to know you. So what I like to do is with, with the start of every show is tell, I’ll ask this one question to all my guests, rewind the clock and tell me how you made your first ever dollar as a kid.
Prashant Kumar (04:10):
Yeah, so basically, you know, I mean, I, I came from an entrepreneur background. Okay. I mean, my, my family was, you know, businessman, my dad, my granddad, I mean, and, and we used to have like combined family, you know, like joint family back in India, you know, grand, you know, your kids live with your parents, parents live with their, their parents. So we, we, we were three generations living together. Mm-hmm so I got up, you know, I got up, I got exposed to business at a very early age, you know, I’m must say that at the age of eight or nine, I was, I was used, I mean, I used to be spending time with my grandad used to do, or my, my dad used to do, and I used to take care of some, some business in the back, you know, like at the age of my age of 12, I would go to go to go with my dad, to the bank, you know, deposit the money, take out the money and run around.
Prashant Kumar (04:59):
I mean, I wouldn’t do the negotiations and stuff like that, but I would do the background work, you know, so I, and at that age, you know, I mean, my grandpa used to give me, uh, one Rupee a day that is less than less than a cent. I mean, about a cent, I would say about a cent a day. And I used to save that even. So at the end of the month, my goal was, was to have, and I used to trick him. And I used to say, there, there are eight days in a week, not seven. So he used to gimme eight, eight Rupe a week. So by the end of the week, you know, my goal was to have 30 rues in my, my pocket. And I used to spend two, you know, eight for the 32, right? I mean, so I used to spend two Rupe and I used to save.
Prashant Kumar (05:43):
So I come from that mentality, you know, not that I’m, I was My or anything. So I always had spend little say more. So that was my mentality. And that went along, went with me even today. You know, I spend little and I save more. And, um, you know, I went to school, a good school in India, you know, one of the top, one of the top institutes I graduated, I worked in different parts of the world and then came to us, worked in various, multi-family not multi multinational companies all over the, all over the country, managed resources across the world. And always the mentality was save more, not save more, spend less and accumulate wealth. But at some point, you know, you realize that, listen, how much can you save? You know, you are working, you get paid only what you, you get paid only what you work for.
Prashant Kumar (06:35):
You know, mm-hmm, so it’s like you’re trading your time. So that was hurting me somewhere. You know, it, I mean, I became a consultant in 2007 and as a consultant, you know, you get paid for the time you work, work on the clock, right? I mean, you get paid very high, but you don’t get paid if you get sick. So that used to hurt me. I mean, for 10 years, I did not take a day off. Can you believe that? Because, because it was hurting me, you know, if I take a day off, I would make makeup stories. I would work in the night if I had, I need so long story short, um, for 10 to 12 years, I did not take a day off. And then it’s done at me, buddy, buddy. It’s not worth, I mean, it’s not worth, what am I saving for?
Prashant Kumar (07:19):
You know? Um, uh, what am I saving for? I mean, I need to do something. I need to make my money work for me. You know, I saved a lot of money I’m as a consultant, you know, I used to, I’m not a tax advisor, but I used to take lesser W2. And I used to save a lot in my pension form and stuff like that. Accumulated a lot of money, um, with the folks, you know, at my age, I had, I had bunch of money. Mm-hmm . So after that guys, I said, I said, listen, I have to find some, some vehicle where I can put my money and let it grow. Otherwise it is not gonna grow. You know, I mean, because we, as technical people are so, so focused in working, working, working, you know, it’s my mind used to, we think that this is the world.
Prashant Kumar (08:04):
I mean, it’s like, like a, like a frog in the, in the, well, say this is my world. And we used to think, and even now, I mean, I know so many people, you know, they just focus like sharp bla focus and they connect think they cannot think like having the blinders, you know, like a horse has when they run. Yeah, yeah, yeah. So, so they just think that this is their world. This is their direction. And, and when I remove them, I see so much, um, so much op opportunities, so many things in the world. If you are an entrepreneur, you can make money wherever you want. Yes. If that’s your goal, not that that’s not that, that’s my goal. My, I come from a humble background. My, my, my 2 cents are, I want to give back to the world and how can I do that?
Prashant Kumar (08:48):
I do a lot of things in my life, charity, philanthropy, things like that for that, I need time. Mm-hmm I do, I did not have time for 15 years. I used to go to those events and I still used to work to cover my eight hours, you know, so I was like, sort of working double, double shifts. So, I mean, all in all, I have reached to a level where I said, listen, guys, I have to give it up. I am not working anymore. And I’m, I’m spending my time with my family and spending time, what I do, what I like to do most, you know, have my own poor podcast, talking to folks like you, you know, find like you, um, you know, spreading my knowledge and, and that’s my journey.
Reed Goossens (09:25):
That’s, that’s, that’s awesome. And I think the question for me coming out of that and speaking to a lot of expats who come to this country who, who want to do more with their life, do you remember the point in which you said enough was enough and I can’t be working 60, 70 hours a week? What, what, what, what, what was that day look like for you?
Prashant Kumar (09:45):
Yeah, so I think that that was not a light bulb for me. Mm-hmm it was, it was like a simmering in my heart slowly, slowly, slowly. And, and I started investing into real estate and real estate started making money. And I said, listen, you know, this is too good to be true for me. You know, I don’t pick up the phone. I don’t call my pro. I mean, not that I don’t, but I spend literally five minutes or maybe a text, you know, to talk to my property manager. And that’s, it, it makes me money. I said, buddy, it cannot be, have, I mean, I work so hard. So freaking hard, 40, 50, 60 hours is like normal. Right? I mean, you know that, right? Mm-hmm , I mean, we talked about it earlier. 60 hours is like normal. And if you are lucky, if you get paid for 40, you still get paid for 40 hours. So point is, um, that thing was simmering in my heart and I, uh, and it still Simms, you know, I mean, even though I don’t work, sometimes I feel like I should work. But, uh, um, I said, I, unless I take a break, I cannot do it. You know, you
Reed Goossens (10:50):
End up in the drive,
Prashant Kumar (10:51):
I’m halfhearted, you know, I’m not working, I’m not putting my full-time effort in my job. I’m not working full time effort in my work. I mean, my real estate work or for that matter, anything else that I like, so I need to focus if I, because I was, I was starting to make mistakes. You know, you, you, you don’t review contracts properly. You mess around, you know, mm-hmm . I said, listen, I have to take a break. Opportunity, showed up, you know, my, my project was, and I said, that’s it for now? And I I’ll come back after some time. And I haven’t gone back since then.
Reed Goossens (11:25):
Well, talk to us about that first opportunity. Like, how did you make that transition from consultant into real estate full time? What, what did that look like?
Prashant Kumar (11:34):
So consultant into real estate full time, that was a big, big thing. You know, big thing means, you know, my, my first pay paycheck, you know, mm-hmm was not coming anymore. So that was like a scary thing. You know, you really, really get scared, you know, what would happen if this paycheck doesn’t come? Fortunately, I have other cash flows. Uh, I mean, my wife has still, um, thinks about it. And she says, you have to go back to work. I said, listen, that’s not, that’s not happening. Uh, at least for, uh, for some time. So it, it was, it was gut wrenching. Obviously it was gut wrenching. And, you know, you are giving up your career. I mean, you have worked so hard top of the Institute, you know, for 30 years worth of work, you are giving up. But at some point you have to say, listen, this is enough.
Prashant Kumar (12:23):
I mean, normal, normal, normally one person remains in a, in a career path for seven to nine years. Okay. That’s, that’s the normal statistics. And I stayed in, in, in one career for, for almost 30 years. Wow. So I said, I said, buddy, if I stay here a little bit longer, then I cannot do it. You know, I’m Al I was already like more than 45 at the time. And I said, if, if I stay here for a few more years, then I could not quit. If I had to quit, I had to put now, um, and, and that’s, you know, I just took a leap leap of faith. I just gathered my finances. I said, listen, as long as I can survive with the cash flow, without depending on somebody else, I should be able to quit. And, and I was making enough money passively, uh, from my investments. So I said, okay, I’m, I’m moving on and finding it.
Reed Goossens (13:15):
It’s so interesting that, that even at 45, you know, some people would think 45, it’s too old. You know, like you set in your ways, you, you’re not, you know, your feet are stuck in mud. You’re not gonna do anything, but that’s awesome to see. And I think for the people listening, like it’s, you know, I got started as an entrepreneur, you mid twenties, you know, a lot of people listening to the show, they are of a younger generation. So it’s great to hear someone like yourself coming into this space, becoming an entrepreneur and not really realizing your roots until you were in your mid forties, which is, and again, I want that to sink and, and wash over people because that is so important. It’s not all about, oh, I wish I’d started when I was 20 years of age. Well guess what? I’m now 45 years of age. You wanna start now so, so your proof that you can, you can always teach an old dog new tricks. Yeah. And it’s so important to, to keep being humble and keep being young at mind, to know that you can push yourself because there would’ve, I’m sure your wife and your kids and your family would’ve said, Prashant, what are you doing? Like you’ve got a great career. What are you gotta throw this all away? I’m sure those, those conversations happen right.
Prashant Kumar (14:22):
Every day, those conversations happen. I mean, every, I mean, it’s like a, it’s like a trap, right? I mean, right. It comes to your mind. It kind of takes over your mind, you know, mm-hmm and I try to remain positive. You know, my wife, it comes to my life, vice mine. You know, my kids are dead, even any going back to work. My daughter says, you know, my wife says, oh, what’s happening? Why don’t you go back to work? You know, you are stop that fat check. I, I say, just remain focused. Let me do what I’m doing. I make a spreadsheet. I tell her if I was working, I would’ve made this much. Um, now I’m making this much and this is my growth. And over the next, in the next, you know, whatever time period, I’m gonna surpass that. And I will continue to surpass that for future.
Prashant Kumar (15:05):
So that, I mean, I, I kind of reassure them. Um, I mean, innovate is good that they keep on reminding me, but I mean, I have to stick to what, and I’m there. It’s not that I’m, I’m too far. Um, I wanted to do it for a long, long time. I found an opportunity if you have an opportunity, I always say that start early. I mean, that’s one thing, like you said, you know, I wish I could have started at the age of 20. That’s what I’m gonna teach to my kids, you know, start early. You don’t have to be working for 20 years. Yes. Maybe you have to work for a year or two, five, maybe to kind of understand how people work, how hard they work. I mean, I was working 14 hours a day at that time. Even now I work at at least that much, you know, my day starts at six. It ends at 11. So I end up working approximately the same amount of time, you know, but I do different things, you know, I talk to you, I talk to different people, you know, I, you know, I do different things, whatever I like to do, I go to swimming, you know, if I have to, so whenever I want, right. So that’s the freedom I have and, and I’m liking it.
Reed Goossens (16:09):
That’s awesome. That’s awesome. So tell me, what does the, the portfolio look like today and what does that, how did that first deal come about, um, to help you break out of the W2 world?
Prashant Kumar (16:19):
So my, my see, I started, I mean, I basically, after I left, I have not added too much in my portfolio yet, but my portfolio had grown even while I was working. I started, you know, with 24 units myself, I bought it myself and I realized I cannot continue to do that for a long time. Like, you know, three single families and then 24 units within six months, period, uh, 70 years ago. And then another 72 units, those things I bought for myself, but there was nothing else after that because you know, your, your dry powder dries really dries rise up. So mm-hmm, , I started getting into syndication, um, you know, like everybody else, I had good deals. I had bad deals. Uh, and last seven, eight years I’ve done total 19 deals. That’s awesome. As, as general partners, um, uh, you know, raised a lot of equity from my friends, family members, um, and, uh, um, I tried to do one deal last year, um, through, you know, under my knee, under my umbrella, which fell off, I lost a little bit money there because of money was hard, uh, stuff like that.
Prashant Kumar (17:33):
It was an assumption deal. Mm-hmm . So, and the bank did not approve the assumption, the pro piece, uh, until the last day of the contract. So that fell off. But so you end up learning a lot. Basically you end up learning a lot, then I’m into assisted living. Also, I have few assisted living projects, um, in California, I did them three years ago. And, um, now I’m working on two assisted living projects, conversion from hotel to assisted living, um, hotel to assisted living and nursing home assisted living. They are on the horizon to close. Um, pretty soon. I mean, I, I must say the next three, three months, they’ll that they take a little longer time, you know, because banks don’t, uh, give you the loan unless, you know, a lot of things are approved preapproved, so they are, um, they are right there.
Prashant Kumar (18:24):
I mean, they will close within the next couple of months, um, for now, just for now. Um, I’m just building my backbone. So to say, to, you know, be able to raise more equity, we are not, we are not in acquisition mode, um, for, you know, for the reasons, you know, uh, the economy is a little bit up and down. So we are just in holding pattern for a couple of weeks, maybe I would say, uh, then we started looking at more acquisitions, probably, you know, either late this year or early next year. So, I mean, overall, um, as I said, you know, 19 deals so far
Reed Goossens (19:05):
For those of you 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 multifamily value, add deals, then head over to Reedgoossens.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. Talk to me a little bit about the assisted living play. How does it, how does that sort of work? What size are you doing? And I’d love to understand the conversion from hotels to assisted living.
Prashant Kumar (19:51):
Yeah, so I started with six units, right? Six unit family in California, you know, California, they have six beds, uh, assisted living projects. So we, we, three of us got together and we acquired three homes. So in a sense, you know, I have one home, probably six bed, um, yes, we get higher rent, but then it is a little bit more intensive of work, uh, because it needs an administrator and it, you know, so the expenses are high. So our expenses, including our debt service are approximately, you know, 70%, you know, if we are full it’s one third that you make. Yep. If you are not full, then you, you end up losing money on the, on the deal. Mm-hmm . So the important thing in this is basically for you to, um, you to measure the demand and the supply, right? I mean, so the, the two places that I’m trying to convert from hotel to, um, hotel to assisted living demand and supply is the play.
Prashant Kumar (20:55):
You know, if the demand is high, then you can create more supply. So the place that I have chosen, and it is like Sierra Vista, Arizona, they are, um, the demand is four times the supply, including the new supply that I’m planning to create. Mm-hmm so, I mean, that’s it, I mean, your demand is four times the supply there’s no, no, no more competition. So I just thought, let me just buy this thing and, and try to convert it. Um, and, uh, if we get to 90% occupancy, 85% occupancy, um, project IRR is upwards of 20, 25 IRR returns, uh, at a very conservative numbers. Um, so overall looking okay. I mean, but again, you have to go through, um, you have to go to the city, you have to go to the permits, you know, construction. Then you go to state and, you know, state gives you the license, you know, administrator is assigned to the building. So lot, lot more regulations, you know?
Reed Goossens (21:51):
Yep. A lot more, a lot more hoops to jump through, which means there’s also less, less competition for you, right.
Prashant Kumar (21:56):
A hundred percent. There’s no competition at all. Right,
Reed Goossens (21:58):
Prashant Kumar (21:59):
You are the only one, you know, you
Reed Goossens (22:01):
You’re figuring it out. You’re figuring. So talk, talk to me. When you look at the, you say the supply versus demand, what are you looking at specifically for those people out there? You know, wanting to know a little bit more about the,
Prashant Kumar (22:11):
Yeah. So basically what is, what is a demand in assisted living assisted living demands represents the, the age, right? I mean, you look at the county population, you look at the age, you know, 72 plus how many people, how many folks live in your primary market area? You know, within five mile radius and from them, how many would, would be the likely candidate, uh, to go to assisted living? So, so let’s say you are within the primary PMA, you have 10,000 people at 72 years of age, you take them and you divide them by one third to see, say that, okay, the out of these, you know, some people may go stay home, whatever mm-hmm, you say, one third probably will go to assisted living. And more importantly, who will be able to pay. So one third will go to assisted living. But one third of that, one third are eligible to go to assisted living.
Prashant Kumar (23:10):
And one third of them are really able to pay themselves. I’m talking about private pay only. So, so 10,000 divide by nine divide by three. And then again, divide by three is about 1100, right? So, so you say, now my real demand for assisted living in this area is about 1100, and this is just a rough number. That’s how I kind of, but we do the study studies have to be done by, uh, by the consultants in the market, you know, BVG or you name it, you know, Newmark. So their business consultants who do the steady and tell you there’s this there’s a demand, right? Mm-hmm you cannot just open a hotel somewhere. If there is no, there is no traffic there, right. Or you cannot have, it’s like multifamily, but it is more regulated. So it is more, it is done really with a business concept in their mind.
Prashant Kumar (24:03):
Now, you know, that 1100 is my demand. And I, then we will look at within those five mile radius, how much is the supply? How many, how many existing facilities are there? Um, in my case, and I just really gave you the numbers. Um, in my case, you know, my, my, uh, my supplies only 115 beds wow. Existing supply. So even if I add another 150 units, my supply, my demand is still remains the four times the supply mm-hmm . Wow. So 250, you know, 110 plus 150 to 160. Uh, and, um, my demand is still four times the supply. So, and banks would not give you the loan, unless that demand is double the supply.
Reed Goossens (24:45):
Prashant Kumar (24:45):
It’s not one to one. It’s one is the two. So, and they, they really look at you very, very hard. Uh, we just happen to be in both of our projects. We just happen to be in rural areas, uh, less than 50,000 people, whatever. Um, uh, and, uh, you know, we are going through SD alone. So initially, initially it’s a, it is a tough, uh, thing to get into. It’s not like, um, you know, family, anybody can come in, you know, start, start now. And six months later, you know, you become general partner. It’s not like that, but it is a long term play. You know, it gives you higher cash flow, higher returns. It’s a business to run, right? I mean, so you put the right consulting company, right. Management company on the ground. I can always share a lot of information if anybody’s interested.
Reed Goossens (25:37):
No, no think thank you for sharing. And, and I guess that is part of the, the, the players. You gotta look at the supply, you look at the demand, but then you look at the approval process, which is, is obviously takes a long time. But then how do you look at the, the, the management piece of it? Cause that’s always gonna be hard once you get the, the deal up and running.
Prashant Kumar (25:53):
Yeah. So again, manage them there. A lot of management companies who want to do this with you, for you. Okay. Um, and, and I get calls all the time. I had engaged when management company ever since from the beginning, it’s a lot of, lot of money obviously have to pay. Uh, even though you don’t know whether that the doors are gonna, I mean, you will be able to close the door or not. So, so we put all that risk money. Um, but there are companies who treat you, you and people like us as investors. And they say, as long as you provide me a place to, in where I can run the business, I’ll run it for you because they own the administrator. They assign the administrator to the building. I, you and I cannot go and run the business because we are not the administrators.
Prashant Kumar (26:38):
We don’t have that many years’ worth of experience in the field. We are treated as an investors, even though we’ll be setting up everything, um, making sure that a building is given to them in the right format and manage the building, but they run it. They hire, they have their sales people, all that goes to all state, basically state doesn’t give you the license. All these things are streamlined. Your sales, your marketing, your caregivers, the training that you provide, the rules, regulation, you name it. I mean, everything is, is taken care of by management company for a fees, either a fixed fee or a percentage of the gross.
Reed Goossens (27:21):
And that, and that is a, do you, are you paying a, so you said paying a flat flat fee for that. Do you get the up, like a multifamily, it’s like a property management company. So they charge what 3% fee typically on a multifamily, is that the same thing for these companies? They charge a 3% fee or 4% fee.
Prashant Kumar (27:39):
Yeah. So basically in a way, yes. Um, but to get to that point, also, they charge you money, right? I mean, they are, they charge you whatever, 10,000, $20,000 per month for a year, just to kind of get to that point, you know, finally opening the door. And after that, it becomes, yeah, 4%, 5% of the gross plus payroll and expenses and everything. Uh, but it’s not as, um, simpler as we manage our multi-family like from asset manager standpoint, you are involved a little bit more, you know, one property in assisted living to three properties in multi-family. That’s interesting. My, my thought is, you know, I mean, as of right now, we have to see how that works out. Um, and, and these companies, they’re pretty good companies. I mean, it’s not, I mean, as I say, you know, multiple companies are calling, they give you the budget up front, they tell you is what they’re gonna do. And, and this is up to you. How do you make sure that they don’t deviate from that?
Reed Goossens (28:36):
Right. And then I think the guess the hard part would be like in multi-family, you know, everyone’s a renter, right. If someone, you know, moves out of the house, but the, the, the renting pool for you, as you just mentioned earlier, it’s, you know, 10,000 divided by nine, uh, uses a very, very specific niche that you are, you’re trying to attract. Uh, so you’re not having people just walking off the street, you have to, you know, really target your marketing. So what type of marketing are you doing in order to get those, those foot traffic?
Prashant Kumar (29:06):
Yeah, so very, very good questions. So the marketing, uh, is actually very, uh, targeted marketing, uh, from a digital standpoint, but more than anything else, it is a lot of local connections, you know? Mm. Your sales department really is connecting with a lot of local, um, philanthropic organizations, a lot of hospitals, a lot of, you know, doctors’ offices, a lot of consultants who bring, um, you know, uh, older folks to you. Mm-hmm . So the marketing is very, very targeted, uh, because each bed, when you fill it up, you know, you are starting to make, uh, force of four to $5,000 per bed. Uh, and, and, and somebody comes in and they tend to remain with you not for six months, you know, if you are doing the good service and you have, you do all that determination up front, they probably end up staying with you until, until the end, when, until the suns for them.
Prashant Kumar (29:59):
Mm-hmm . So it is very, very targeted marketing. Um, and, um, you know, as I said, you know, a lot, lot of local connections, you know, it’s not, not just, you know, go to go to digital media and, and, and put the ads. That’s not how it works. I mean, we do get a lot of referrals from digital media. Don’t take me wrong, but, uh, a lot of things come from referrals. You know, doctors, you know, a lot of hospital, hospitals, hospitals, and, and, and talking, you know, basically sending gifts to these places, engaging them in the community, you know, things like that.
Reed Goossens (30:33):
Mm, no, very, very interesting. It’s, it’s a very fascinating space because we’re all getting older, right. We’re not getting any younger and that’s always gonna be a demand driver. So back to what you’re building, I think it’s, if you can build a good mouse trap, you can then replicate it. Uh, how difficult is it just on a final question here? How difficult is it to, to look at other markets? You know, like for me as a multi-family investor, you as a multi-family investor, you can sort of go and pick and choose a market, but you really have to understand with the assisted living, what’s the local legislation, the local state laws, like who you have to get, you know, on board to, to approve these projects. How does that, do you, do you target certain states or certain markets?
Prashant Kumar (31:11):
Yeah. So that’s a very good question. I mean, that’s the beginning of everything, right? I mean, if the, if the, if it is not approved, then it’s not worth penny for you. Right. So you really go into it, look at the project. You spend your time. A lot of new religions is done. You go to the city, you go to the, uh, you go to the banks, you go to the, uh, state to figure it out. Whether they’re gonna approve a project of, of a certain size in a locality or not. And typically, you know, if you go to a place where there’s a need, or the local legislators try, tend to approve that, you know, they say that, yes. If, if we, if you, and you need to change the zoning of your property also. So, so basically all that is done, I mean, there’s a lot of due diligence that goes in.
Prashant Kumar (31:58):
Um, and without with, I mean, other, it would not just move. So you spend a lot of time, you know, I would say months, and, and the basic thing is how you buy it, right? I mean, if you buy an asset which is depressed and somebody’s willing to sell it, um, then it is easy. If you try to build, then you will not work because if you are trying to build, and you have one of the five bidders and you have this plan fight in your mind, and somebody else just wants to keep it, the hotel as a hotel, then you, you, you are better at walking away from that because you are not gonna get, um, you are not, you will not be moving at the faster pace, you know? Right. It’s gonna take long, long time. I mean, has taken me, uh, more than four, 12 months, uh, on, on both the pro projects. And I’ve been sitting on both two projects, which are likely to close, uh, and knock on the wood, hopefully one in next 30 days and one probably next 90 days. Got
Reed Goossens (32:54):
It. Awesome. Awesome, mate. And where do you, you know, last question, where do you want to scale this two in the future?
Prashant Kumar (33:00):
Yeah, so basically, uh, it all depends, you know, I want to, you know, start these, I want to probably let them run, uh, a little bit more and, and kind of test the waters. How’s it going? And then, um, I mean, I, even though I’m looking at other properties too, you have to have a consultant who’s on a side, you know, who can, who can look the data, look up the data for you like that, you know, in a split second lot of things lot of things come to, to our table, but, you know, we cannot just do the analysis in five minutes. It’s not like put rent, roll T 12, put in, in a, uh, you know, model and say, oh yeah, it’s gonna work. That’s not like that. It’s not like that. Right. So a lot more analysis is done. So I have three people on my side, you know, who wants to do it? Um, they, they do the research for me. They have access to the databases. Um, I want to grow it to the next level. Is it gonna work out? Um, I’m pretty sure it’ll work out eventually, but, uh, each project takes long, long time. Yep. I want to grow it. I want to grow it. I have two projects maybe within the years time. Uh, probably the third project will show up somewhere. Uh, and then by the time, hopefully I have my processes aligned. Then it’ll be easier for me to answer this question at that time.
Reed Goossens (34:18):
No, I, I look, I think you’re doing the hard work that most people don’t want to do. And that’s gonna set you up for success in five years time, you know, where you, where you have it all, it just, it goes like clockwork because you, you know, how to, how the system works. So I think kudo kudos to you for, for getting in there, rolling up the sleeves and getting your hands dirty. Now, the end of every show, we like to dive into the top five, uh, investing tips. It’s a lightning round. Are you ready to get into it?
Prashant Kumar (34:44):
I am. I’m ready.
Reed Goossens (34:45):
Mate. Question number one is what is the daily habit you practice to keep on track towards your goals?
Prashant Kumar (34:51):
I meditate every day morning, and not that that’s the goal of my meditation, but my deepest level thinking happens during meditation. The things that I cannot think otherwise I’m able to comprehend them and, uh, make my plan within a few minutes. You know, I don’t do that for that reason, but it does happen when I’m under stress and when I need the deepest level of thinking. So that helps me keep going.
Reed Goossens (35:17):
Got it. I’d love it. I’m, I’m a meditator every single day. And if I don’t meditate in the mornings, my day is completely off. You know, it helps me get centered every morning. So yeah, meditation is definitely a big key on this show that every one of my guests come on, they tell me that they meditate every morning. And the other one is for me, is sleep, prioritizing, sleep, sleep, and meditation. Although if you don’t get those to your day is screwed. Uh, question number two is who’s been the biggest, uh, influence in your career to date.
Prashant Kumar (35:42):
So, I mean, as I said, you know, I started my journey when my dad, my father, um, you know, working together. My dad was very simple, man. Um, um, so I had a spiritual guide. You know, I had somebody who taught me mutation from a very early age. You know, I started meditating when I was 18. Um, the name of the person is, uh, C. Rajagopalachari he’s from, from India, from Chenai mm-hmm, , you know, I followed him, not that I had to like, hold his hand or anything. I followed the philosophy, whatever he said, you know, don’t worry, it’ll, you know, whatever is happening is happening for a reason in life. And I followed that philosophy very well. I mean, I don’t get distressed, even if I lose a few bucks here and there. Um, and he has been the most influencer in my life. He’s no more, but the organization is still there, heartfulness.org. And I made it that organization. I’m actually an, an instructor. I spend a lot of time helping others to meditate, to gain peace.
Reed Goossens (36:43):
Prashant Kumar (36:43):
Degree of charge. Yes.
Reed Goossens (36:45):
That’s awesome. That’s awesome. I love it. I love it. Question number three in your business, what is the most influential tool? And when I say tool, it could be a piece of, you know, it could be a journal or, you know, physical tool, like a phone, or it could be a piece of software that you can’t run the business without. What is it?
Prashant Kumar (37:03):
So, I mean, um, right now, I don’t know, for some reason I cannot think of anything, which is, but most important is my phone. You know, that, that without, that obviously cannot run the business and actually it, zoom is becoming then an important tool for me because all my meetings whole day, you are on zoom, right. I mean, right. You can avoid, you can avoid going meeting people, talk to them on zoom. Uh, I must say phone and zoom. You know, these are two really important tools for me.
Reed Goossens (37:33):
That’s awesome. No, I, I completely agree. This is completely change of way. We do our business today with, uh, remote type of working so awesome stuff. Uh, second last question is in one sentence, what has been the biggest failure in your career? When did you learn from that failure?
Prashant Kumar (37:48):
Yeah. Yeah. So my, my biggest, uh, yeah, thing that I learned is learn to walk before you, you think of running, you know, learn to walk because you don’t know what you don’t know, um, coming into a business. And it’s very important that you have somebody on your side who can hold your hand and take you to the next level. So that is, I think is the biggest key. Um, just, you know, don’t go, don’t put a lot of hard UN money at risk, um, into a project, uh, unless, you know, in and out of the project. And, and unless you have somebody on your side who can take you to the next level.
Reed Goossens (38:26):
That’s exactly right. I love it, mate. Last question. Uh, where can people reach you to continue the conversation they wanna be in your sphere? Where do they go? Yeah.
Prashant Kumar (38:34):
I mean, basically, if anybody wants to reach me, you know, you get to go to my, my, my company, you know, behind me, My Realty Gains myrealtygains.com, uh, and then schedule a call with me. Um, that’s it. I mean, that’s the best way to connect with me. Awesome. MyRealtygains.com.
Reed Goossens (38:52):
MyRealtyGains.com. Yeah. Well, Prashant I wanna thank you for jumping on today’s show, just to reflect a few of the things I took away from today’s show. I think your ability to understand when enough’s enough, right? You, you know, to, to have that pivot in, in your late, late her in life, more, most entrepreneurs get started a lot earlier to, to be mid forties and, and, and pivot into a business when you’ve had a year, uh, your multiple decade career. Um, would’ve been a tough decision to make, and I just think that’s a really great lesson for everyone who’s listening today, show that you you’re never too old, right? You’re never too old to get started, uh, in this business. I think the second part of the conversation where we talked about, you know, assisted living, it is a very detailed business. And I love the fact that you’re rolling up the sleeves, getting your hands dirty, figuring out a niche in the market where you could be a market leader someday, because you are putting in the hard work today. You’re not going and getting, you know, 10, 15, 20 multi-family deals a year. You’re just focusing on a couple of, of, of assisted living. But once you get the, the machine up and running, it could be very, very profitable for you in, in your investors, in the future. So, uh, I wish you all the best. Did I leave anything out?
Prashant Kumar (39:58):
No. Reed thank you so much. No, you kind of, you kind of summarizes very well. I mean, that’s the goal. I mean, I, I’m not stopping doing multi-family. I, I will continue domulti-family because that’s the bread and butter. That’s where I’m getting the cash flows from. So mm-hmm , and, and to me, I, I must say that that’s easy money as of right now. I mean, uh, but you know, assisted living probably, uh, once I get a taste of it, maybe I’ll come back and, and share my experience here again at, on your podcast. And I would love to once again, um, thanks for inviting me.
Reed Goossens (40:30):
My pleasure. Well, look, mate, enjoy the rest of your week. We’ll catch up very, very soon.
Prashant Kumar (40:35):
Thank you so much. Take care. Will
Reed Goossens (40:37):
They have it, uh, a cracking episode jam pack with incredible insight into Prashant background and how he got started really from scratch, and then you, as he pivoted later on in life in a, in a, in a very, really well established career, um, pivoting into entrepreneurship, uh, he now is also pivoting into, um, assisted living, which is such a very, very awesome niche. And if you’re interested to find out more, remember head over to my Realty, gains.com, check out everything he’s doing over there. Uh, I wanna thank you all for taking some time outta the day to tune in, to continue to grow your financial IQ. Cause that’s where we’re all about here on this show. If you do like this show, the easiest way to give back is to give it a five start review on iTunes. All the show notes from today will be up on my website, reedgoossens.com. There’s a whole bunch of content over there, free content. Please go over and subscribe and check it all out@ reedgoossens.com. We’re gonna do this all again next week. So remember be bold, be brave, and go give life a crack.