Making Money in Multifamily Real Estate Show

168 | SEC Compliance, Facetime With Investors, Ethical Operations with Ken Gee

January 12, 2022 Dave Morgia Season 1
Making Money in Multifamily Real Estate Show
168 | SEC Compliance, Facetime With Investors, Ethical Operations with Ken Gee
Show Notes Transcript Chapter Markers

Ken's Background:

  • Founder of KRI Partners and the KRI Group
  • 25 years of RE, banking, PE, and investing experience totaling over $2B in transactions
  • Background in accounting/finance and also licenses to broker in OH and FL

In this episode we cover:

  •  03:53 - Staying honest in the SEC's eyes
  •  07:56 - It's all about experience
  •  10:42 - Pay attention to deal structures
  •  14:42 - Face time with every investor
  •  18:36 - Creating a clear mission throughout the company
  •  21:59 - Penny Wise, Pound Foolish
  •  25:47 - Divorces with vendors
  •  30:09 - 5KQ1 - If you could only pick one trait that explains your success, what is that trait and why?
  •  31:01 - 5KQ2 - What is the most uncharacteristic thing you've done in your business and why did you do it?
  •  32:14 - 5KQ3 - Can you name any time where you felt like you were not going to end up successful? How did you overcome that fear?
  •  33:05 - 5KQ4 - Can you name a time where something in your business went perfectly and what did you do to make that a reality?
  •  34:04 - 5KQ5 - What have you been focusing on lately to improve yourself or your business?

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Intro:

Welcome to the Making Money in Multifamily Show, where we discuss everything to do with multifamily real estate investing. We believe it's the best way to gain financial freedom and build lasting wealth. This is where you'll find it the best information and practices to help you succeed in your real estate business, whether you're already experienced or just starting out. Here's your host, Dave Morgia.

Dave Morgia:

Hello listener and welcome to the show. I'm your host, Dave Morgia. And with me today is Ken Gee. Ken, welcome to the show.

Ken Gee:

Thanks so much for having me.

Dave Morgia:

Yeah, Ken, just want to give your background before we dig in for the listener, Tennessee, founder of KRI Partners and the KRI Group. He has darn near 25 years of real estate experience banking, private equity and investing experience just in general. And that totals over 2 billion in transactions, his background to get into all that in finance and accounting. And he also has licenses to broker in Ohio in Florida. So yeah, just a lot on the resume. Can you want to just kind of dig in on your focus and your background?

Ken Gee:

Sure, sure. So I grew up in Toledo, Ohio, got my undergrad from University of Toledo moved to Cleveland went to work for a bank, where I was a commercial lender for five years, while I went to school at night at Case Western Reserve, got my master's degree. Then I decided, as I was at the bank called I kept hearing, or my clients talking about the fact that they were making a ton of money in real estate, right? They had ongoing businesses, but they're always focused on this real estate piece, right? And I thought, Okay, well, then I went to Deloitte, where I spent seven years as a CPA, and would you know it, the Cleveland office at Deloitte had a huge real estate practice. So again, here I am seeing clients just making money hand over fist, I said, you know, enough of this, I've, you know, I don't know how much you know, about CPAs. But they work really hard, really, really hard. And you're always working for somebody else. And I, there was in 1997, I decided to go out there actually 95, I started to figure it out. And in 1997, we bought our first deal, small 28 unit building and shaker square, which is a part of Cleveland, Ohio. And so that that was my first deal. That's how I got started. But 10 or 15 years ago, I decided, I'm fast forwarding a bit here, I decided it's time to go to Florida, right, Cleveland is a is a good market, it's just tough to make money in a non growth market. So I said, Wow, if we can do this, well, in a non growth market, what would happen if we were in a growth market, so it took a long time to get get our feet on the ground, establish credibility and all that, but we've been in Florida now for quite some time, we also do third party management, and we managed just about 2000 units, somewhere around there, plus or minus 2000 units on central and northern Florida. So you know, I know, that's a very long winded or very quick, you know, trajectory through through the the way we grew up, but it's been a lot of fun. And now we just focus primarily in Florida.

Dave Morgia:

Now, that's a perfect summation, and really just highlights where you are today. We are talking before the show, kind of about private placements. And obviously, you've done quite a few in this point. And just the volatility that can be kind of just happened with a private placement, just, you know, the essence of the term, you know, it's just a deal that doesn't get a you know, a lot of SEC kind of discretion and all these things and you have to kind of make sure that whichever side of the coin you are on, you're behaving or making sure everyone on the other side and on your side is behaving. So do you want to just kind of dig in on that, as far as you know, what do you do in this kind of private placement space? How do you a we were kind of talking about some some programs you're in and maybe just talk about how you present yourself, and how you hold yourself to a standard these days.

Ken Gee:

Sure. So what I think is important. So back ever, I'm sure everybody probably knows the Jobs Act in 2012 is what kind of created the opportunity for us to have this private capital market, which is really exciting. Because before it was only the you know, you had to know someone right? It'd be a extremely wealthy, and you had to know someone it was called the country club network, so to speak, right? That's what it was, well, that law, pushed it down and made it possible for many more people to get out of these real estate deals. Because you really, you know, people are making a killing in these deals. But the ordinary man and woman couldn't get into them. So that number one, I was so excited to see that happen. This this private capital market has been growing over time. And so now it brings with it a whole new perspective. And that is now we have private investors, meeting with private syndicators and fund managers to figure out where to invest their money right there's it's no longer a publicly traded audited financials, you know, all of that stuff is gone. So, if you think about the long term health of this business, and the ability for investors to do really well with sponsors, it's all about experience, track record and all of those things right. So one of the things that I focus on is make sure that we're vetted. Right, we're super transparent, we use a company called ver Avast there, it's on the web veribest.com. And what we did is we paid them a ton of money. They do this for not just us, but lots of people. They, we had to send them 23 years of tax returns, settlement statements, operating agreements, I mean, you name it, they, they vetted our entire track record, ticking tide, the entire thing, which I think is super critical. Because now when we talk to investors, they don't just have to take my word for it, that I really did all those deals, and that we really did make all that money, somebody looked at, oh, you know, this guy really did it. They also do a full background check, which is really important, right? You know, now that I'm not a criminal, I don't have a felony, blah, blah, blah, all those things are important. And to top it off, then you can choose a service with them, which we do. And that's a monitoring service. So going forward, everything that we have, we send them quarterly, our GL our bank reconciliations, our bank statements, they have our operating agreements, and they look and see what we're doing, and make sure that we're complying with what we told our investors that we would do just a massive, massive benefit to the, to the whole industry, I think so again, I'm not the very best poster boy. But I believe so much in that, in that concept that as soon as I heard about them and learned about them, being a CPA myself, I thought this is exactly what this industry needs. So so we embrace that fully. It's an expensive proposition. But as I think about you know, most people get into this business passively. And true passive investment means you give your money to me, and then I go make it where I go make money, and then give it back to you. Right? That's truly passive. So you've got to really make sure that the people that you're investing with are well vetted. And what they're showing you on paper is really what they are. That's at least I think that's critical.

Dave Morgia:

Yeah, service like that. It's certainly interesting. It seems to be, like you said, kind of write up your CPA background, Allie? So I'm glad it's working out well, for you. And and as it should, right. I mean, if you go into something like that, with no skeleton in the closet, then other than the kind of pain of gathering documents and the monetary value, there's no downside to doing that. Because you want to prove to everyone that you're staying above board, right. So that's, that's amazing. Unfortunately, can not everyone could probably say the same. So to those investors, what do you say to them when they're starting to evaluate who they do business with, especially because this private placement market, you just can't know everybody? You can't know all these sponsors? And maybe you get a referral. And someone did one deal with them. And it worked out great. But that was a cake deal. And the next one doesn't look so juicy. So so how do you kind of walk people through the decision making process to work with somebody?

Ken Gee:

Yeah, that's a really good idea. A really good question. So it's all about experience, right? Think about this. If if you just started doing something a couple years ago, you probably are, you have a whole learning curve ahead of you. Right. You know, I covered this in the book, I wrote a book. We can talk about it later, but multifamily real estate's a total game changer, right. So what what, everybody starts out trying to figure out how they're going to do this? Should they buy a single? Should they buy a double? Should they invest with somebody else? That's, I mean, that's the first step in the process. Secondly, now you got to figure out how to vet people. And so what I do in this book, because I talk a lot about this is let me tell you how the business really works. Right? What makes syndicators do, what they do, act, the way they act, same thing with fund managers, and I help spouse or I help investors figure out how to vet sponsors, and I focus on a couple of things. Let's get to the answer of your to your question. Number one, his track record, we just talked about that. Number two is experience. That's really, really important. In fact, I would say, well, you obviously have to have a good experience, but the track record, or the experience is critical. So if you can have an impromptu conversation with a fund manager, syndicator and you're asking really detailed questions, like what I point out in the book, there's a pretty good chance that if they don't know what they're doing, you're going to start to sense that you're gonna start to sense I you know, that doesn't sound like he's really diving in, and he really gets it right. That's your goal is to figure out whether or not they really know what they're doing. Everybody's going to tell you they have experienced the question is How much experience do they have? And you have to figure out how to gauge that. The last thing I would say, that is really important that I like people to think about is just the terms of the actual offering. Right when you when you do a syndication or you do a private placement or you do a fun when when we start creatively say we literally have a blank slate. Exactly how do we want to turn so look, how do we make sure that our goals align with our investor goals, right, that's really important. You should never be in a deal where it's possible for the sponsor to do really well but you're not right. That's bad, right? Sometimes, you know, people new in the business they don't think about, they just haven't thought that deep into the whole process. So, you know, I do want them to consider that because the terms are all over the map, the fee structure is all over the map. And you're just you just want to understand what it looks like, again, more of what I go into in the book, but it gives you a feel for what what it's like in this business. So you can decide no, you know what, yeah, I don't I can't see a scenario where he does well, and I don't, right, that's what you're looking for. And if you can find that, then you're golden. In this in this business.

Dave Morgia:

Yeah, it's funny. You mentioned deal structuring, I was talking to someone the other day about, and I didn't get the whole lay the land on the two deals, but they were like, Listen, I have the same opportunity in both deals, I could write the same check. What would you do? And I was like, well, first off, I can't do that without seeing the whole thing. So this is just like, high level advice. What it looks like. The other deal, which was basically a more core Core Plus, you know, a b b plus asset is the way better deal when you're looking at the returns are the same on the C Class deal. Like I don't know, the deals again, like I can't tell you but like if you're just looking like dollar for dollar apples to apples, like you have a better risk reward here than the other one. So the question you asked that sponsor who was pitching the same two deals is that why is the return profile the same on two deals where the risk is so different? So it's just funny to see these things in the market where I mean, immediately after talking to that LP, I was like, that's on my radar now to like, look at these guys that like who I have never done business with. But now like, I know something about them that I didn't know before. So it's just interesting to see these things kind of hash themselves out in the market. My question to you, Ken is, in your experience, you kind of floated around in the background of real estate, you got interested in it, because it was just kind of surrounding you. Did you have any experiences investing passively where you either did really well or got burned or just some interesting story as to kind of how how it shook out when you learn these processes yourself?

Ken Gee:

Yeah, interesting. I never invested passively remember the depth, the true definition of passive is I just handed you my money, and you go make money for me, right? I mean, I've invested in the stock market and REITs and mutual funds, everybody's done that, but I've never actually invested well, that's not true. I mean, I'm actually eliminated one person's deal, which, which we just got in, but it's just because why not? It looked like a nice deal that I wanted to be in. So I've not been a passive investor, but the CPA in me, every thing that we do, and every way I think of things, I always try to look at that other side, right? Because as a CPA, the CPAs job is to protect the public. Think about that. That's what we're doing. As a CPA. Now, I'm not a CPA anymore. So that mindset after years and years of doing this at Deloitte, you start to think about Wait a minute, wait a minute, how what's, how is this gonna hurt the person who's investing in this company, so on and so forth. So you come in with that mentality. So that's why I have, maybe I have a keen awareness of that. And after you talk to so many investors, some investors are brand new, right? They're just trying to figure it out. Some investors, I talked recently with a guy, he has been in just about every investment I could ever even imagine, super, super sharp guy, and all of our investors are but this guy just knew that the market and understood exactly what to ask and exactly where to go. So we have this whole, this whole range of people and I try to listen to each and every person I have a conversation with, it makes sure that we're aligned, right that I did, okay, yeah, I see where he's coming from. Because, you know, even though we've been doing this for almost 25 years, we're learning every day. And every investor that I talked to, I learned something from and hopefully they learn from us, but it helps me continue to focus on what's important to them. And that's the key is as sponsor a syndicator. In this fund, or the syndication world, you have to be careful that they don't get this FOMO and mentality, right fear of missing out, right, like I got to do this deal, I got to do this deal. Because what happens is they do the wrong deals then Right? So again, as over time, as a potential passive investor, you're going to start to see that you're going to see it right, you just will. So I've never done passive investment. But I've always tried to really make sure I understand how investors think in what's interesting to them. And, you know, the reality of our world is it boils down to their family, right? They're investing for their family, their kids, their retirement, their whatever. And as long as you keep that in mind, you know, as a sponsor, I think you're in good shape.

Dave Morgia:

So for your investor base, are you having some level of personal face or phone time with all of them? Or is there some type of system that you employ with people you believe are good stewards of your mission in the company? How are you making sure that their goals align with what you're trying to do with the properties you close?

Ken Gee:

Yeah, really, really good question. So I right now, you know, we're of the size that I can still talk to every single investor. And it is important to me that I'm Have a zoom call with every single person that invest. You know, we have folks that will send me an email, send me this, send me the forms, I'm ready to invest. And I hit the timeout button. I'm like, timeout, guys, no, no, no, no, I need to talk to you, I need to understand what you're doing. Because it is important to me, right? They may not even realize that their time horizon and hours might not match up. Because even though I, you know, we write all these documents to send them to read. I mean, some of that stuff is a really boring reading, right? Nobody reads that stuff. I wish they did. Some people do, but a lot of people don't. And I want to make sure that, you know, if you're looking for a three to five year hold, that's what this particular fund has. Now, I feel better, you understand the risks that you're taking on? Now I feel better. And it's important that we match it up. Because the last thing I want, I mean, if you get a mismatch of goals or investment objectives or understanding of risk, nobody benefits not net, of course, the investor gets hurt. But so does this fund manager in this indicator, right? Because we don't want to have that mismatch happen, either. It's not good for anybody. So yeah, I try to talk to everybody, even if it's short, 510 minute conversation. I want to have it with everybody. And hopefully that's, you know, I don't think anybody objects to that.

Dave Morgia:

No, I mean, a messy relationship is messy for both sides of the party, right? Like, it's not like it goes clean on one side, and you know, messy on the other, it on the one end, you know, they potentially lose their money. But on the other side, you're having to deal with someone who didn't have the kind of wherewithal to understand what the plan was. And then you have someone who's upset with you, who is kind of a dent on your reputation, which is obviously, right, as a CPA, I'm sure that's the very last thing you want is to have a kind of notch on the on the score there. So yeah, it makes a lot of sense for you to keep on the FaceTime. You mentioned you're at the scale right now, where it's still feasible. What do you if you've planned it all planned to do if your investor base grows more by Count, to kind of make sure that you're still paying attention to everybody?

Ken Gee:

Yeah, well, first of all, I will always pay attention to everybody, throughout our company, whether you're a third party management side, investment management side, everybody can reach me, that's really important. Because if somebody's stressed somebody, something's not going well, you know, what a property we manage in Jacksonville for another for our client, right? That resident can get to me. And that's important, because that feedback loop is really critical as you're growing a company, first of all, second of all, I have to make sure that I build the foundation. So that if I, if and when we do get to the point where we delegate some of some of that investor relations contact, right, I mean, we have investor relations held now. But every person has to talk to me before I'm going to sign off on a subscription agreement, there will be some point where that is expanded, but not till I have somebody in place that I trust is going to have the same moral compass that I do, and have the same belief structure. So you know, we're going to continue to grow. But what's important is that we grow slowly. This is the conservative CPA nature in me, I want to make sure I have a good foundation under me. Because I've seen too many times in this business, people grow up very fast, they don't take care of the foundation that supports everything. And it really gets messy because it collapses in on itself. And you just, you just don't want that. So we're gonna be slow and deliberate about our growth. We're cool with that. And so we'll make sure that you know, when that is delegated that face to face contact, before investment is delegated, that it's the right way to do it.

Dave Morgia:

Yeah, and you're kind of leading me to my next question. You're making it easy on me but it seems like your mission is pretty clear. Your ethics are very, you know, just straight as an arrow there's no wavering there's no nothing. I'm you know exactly what you want to get out of this business. How have you found success hiring to replicate that methodology in your business? Who How did you find the team around you that has the same goals, the same mission as you do?

Ken Gee:

Yeah, I mean, we just build it very slowly and very carefully, right, every person that comes in whether they come in on the management side, or the investment side, it takes some time to understand how we do things, we do things a little bit differently in just about every part of our business. And so they you know, usually there's some level of experience about how to do whatever it is we're hiring them to do, but they don't know how we do it. So it just what is important is that you do this slowly that that's the key, because over time people to kind of get assimilated into that method. So how do we hire people we just slowly and carefully and it's no secret right now that it's hard to hire anybody anywhere, for anything. So it even makes it more of a challenge. But you know, we just make sure that they understand coming in what what what we are all about what we need them to do, you know, we have very solid feedback systems in place because again, this is all about building that foundation. Because every time somebody comes to me and our customer, or investor or resident or vendor, anybody, you know, that's not me anymore, it's them talking. And it's important that they are you know, they I call it their drinking kool aid so to speak.

Dave Morgia:

Yeah. And that's the internal team. So it seems like it's just a slow cultivation process. There is, of course, levels of external team members where you're working, if you're on the pm with another operator or as an operator, just, you know, venturing out a deal together. So how do you manage those relationships? I'm sure, there's some level of being on the same, you know, path and ideology. But people do operate differently, and you can't necessarily force someone to do things exactly your way. So how do you navigate those waters?

Ken Gee:

Yeah, so if you if you're thinking about property management companies that we manage all their own stuff, so we generally don't have that issue. It's just not one we deal with. But we deal with all different kinds of vendors. And we look for vendors that align with with our goals, right? My message to our vendors is, look, if you if we call you, you know, you're going to get paid, you know, it's going to be timely, if there's ever a problem, you just you come right to me, and we'll make sure it gets resolved. And in exchange, I just need you to answer the phone. Right, treat us fairly answer the phone. So with our vendors, we try to establish long term relationships, because they're no different than me and you, they're people, they need to make a living for their family. You know, it's not always about trying to extract every last, you know, penny out of them. This is about a relationship, that's long term. So that's how we grow these relationships, internally and externally minute. In my mind, there's really very little difference between the pest control company, the plumbers, that we use the electricians that we use, than the people that employ that we employ our property managers, right. They're still people, we still have relationships with them, they have the same needs we do. So we're, it doesn't matter how they're classified. In our view, we try to treat them all, as stakeholders in every person matters in the system. Does that make sense? I don't know.

Dave Morgia:

No, no, it definitely does is the treating people as people, and one of the points you mentioned, which I wanted to highlight was kind of, you know, getting every last bit out of them, or what have you, which is really more of the penny pinching, Pennywise Pound Foolish type of thing. What is your experience with that? Whether it's, you know, taking over property that has gone too far with that type of methodology, whether it's, you know, making sure that you're not doing it, I think sometimes you're and you have to worry about dollars, but you can ruin relationships for for really not a lot of return if you if you're not being careful. So how do you kind of navigate that?

Ken Gee:

Yeah, that so when we take over a property, we can tell if the property has been managed in that way, what typically happens is they don't just do it with one different stakeholder, they usually do it with all the people that are doing things for them. Usually the employees are not very happy. They're very frustrated. Usually vendors, you know, though, you can tell when a vendor has been mistreated when you call them, you have to start the movement, if they're pit reset, tell them we're not the old owner, the old management company, we're new, we do things differently. They're going to be skeptical. So you have to prove yourself over time. So it, here's the here's the thing about it, people are very short sighted, they think if they got that plumber to work for 50 bucks, instead of 60. They think I really, I did my job. Well, here's the problem. The it is extremely easy for that plumber to make up for that 10 bucks. He just pads his hours. Or Guess what? He doesn't answer his phone, right? Think about the labor shortage we're in right now. Right? Who do you think you're going to take care of? Are you going to? Are you going to rush right over to the guy that you know is going to mistreat you who you know he's not going to pay you forever, he's probably going to ask you for a discount in order to get paid. Are you going to? Are you going to call you're going to come to me to my property? Because you know, I'm not going to mistreat you, you know, we have a relationship. The challenge here is in the hidden costs. And that's what people don't understand. I tell our people, here's what's critical. If I'm not looking, if we aren't looking, will that person's still want to do a good job for you. If you're constantly beating on them and mistreating them. I mean, think about that. Do you want to go do a wonderful thing for the person who's just mistreated you forever? No, no chance. Right? So those costs, they're there, they're hidden. You think you saved this little bit of money? Or you think you did this? You think you did that? But the reality of it is you just destroyed the relationship. And it's costing you in other ways. You just don't quite understand how it's your p&l.

Dave Morgia:

Yeah, and the plumbing example is probably the best one because that's about the last person you don't want to pick up the phone on the weekend when the pipe bursts or whatever. Think about what he's got to do

Ken Gee:

there and deal with

Dave Morgia:

stuff, or you know, are hella good. They I'll be there. You know, the best I can do is six hours when really if you were nice to him, it would have been you know, 30 minutes so so yeah, I think you're completely right. It's it's more of a Yeah, kind of scratching your back and I'll scratch yours. And it's not like there's any, like weird, you know, payment, things going on or anything, but let's just be fair and honest people and do business in a correct way, you know, we go into the job agreeing on certain things, we, we don't kind of go against that as the job goes through, right, and we're just gonna kind of work through it as humans and figured out. So I like to hear those tapes because you see, you know, numbers on a spreadsheet. And then once you figure out that those numbers work, you can try to squeeze more out, but the same time, you could be doing more damage for the long term relationship. So

Ken Gee:

I say find other ways to do that through technology and being more efficient and, and things like that. That's what we tend to focus on.

Dave Morgia:

Yeah. Is there is there anyone in that kind of contractor vendor services where you had to, you know, select another party, because they kind of didn't fit your vision or anything like that? I'm not saying that. Yeah, happens a lot. But I'm sure there's has to be an occurrence with the amount of properties you've covered.

Ken Gee:

Yeah, that there, we have suffered some vendor relationships, because they just didn't match up, right? They, they wouldn't take care of our residents they would do they would track mud all over the apartment, things like that. Yeah, it happens. It happens. I mean, we're, you know, we treat them as relationships that we treat them carefully. And you know, every vendor, you know, the plumber, he may have one bad plumber, right? So you're not going to destroy the relationship, just because one guy showed up and didn't act appropriately. You're gonna, you know, call the guy Hey, can we not, you know, have that guy back, you know, but usually what happens is, they want that feedback, because they don't want the guy doing what he just did. Because they know just like I do, it's not good for business

Dave Morgia:

to reputation is online, just as much as yours is

Ken Gee:

so right. I was there running a business just like I am just like you are. Give them a shot. Let them fix it. And they usually they do. But if not, we're prepared to sever those relationships, because it's not a healthy relationship. Right? If you're not getting what you

Dave Morgia:

need. Yeah, it's such a it's such a tough area to decide on what to do, because it's in one aspect, are you giving them enough of a chance, like you said, but in the other? Are you waiting too long? And are you just drawing this out longer than it needs to and you should have done it months ago. So I just like to hear people's takes on, you know, where they decided to put the line in the sand. So it is

Ken Gee:

a tough act, a tough balancing act, I will tell you and I is as I'm sitting here, I've probably been guilty of letting it go too far. Sometimes, because I want to give people a chance, right? When I ended a relationship, I want to know that I've done everything I can to fix it. And if I can't, I can't, that's fine, we'll end it. But at least I've given it a shot. You know, I don't like to be unreasonable with those relationships, and especially if I'm the one ending it.

Dave Morgia:

Yeah, and that helps you sleep at night too, of course, right? If you went to bed, knowing that you yourself did everything you could to at least try to make make amends, that helps a lot. So that's good, great. Getting into, I guess, back more of the team building and where you see everything going? Are there certain areas of the business that you're focusing on hiring or growing? Basically just based on needs for the company or where you want to be? And we'll explain

Ken Gee:

that? If so. Yeah. So again, our company is basically two different teams, our investment team, and our management team. I mean, we're growing up both front. So on the property management side, you know, we manage our own stuff, as well as properties for others. We need property managers, good maintenance people, leasing people, you know, regional managers, we're hiring and all those positions, because we continue to grow. You know, for example, as I, as we record this, I think, this month, we're taking on four different properties, right, all over Central northern Florida. And that's pretty hefty growth, when you're talking about several 100 units, right? On the investment side, you know, we continue to grow, because we continue to raise money, we have to deploy the capital in a meaningful way. So it's just looking at all those deals, right? I mean, you get one deal done, it's at least 100 deals your underwriting because more north of that, these days, they just don't make sense. So you got to find a way to, you know, beef up your team and get that. So, you know, I would say anybody listening, if you're interested in learning this business and be a part of it, I mean, we definitely have room for people. And then there's all marketing side, right? The whole, you know, this world is all about marketing. And being a CPA, a little out of my comfort zone, I'm getting there, we're getting better at it. But you know, that is another area where, you know, we're definitely looking to add people.

Dave Morgia:

Yeah, I just, I think you seem to be at a pretty confident but critical point in the business where you've achieved pretty much exactly what you want to so far, but this is maybe like the, you know, the second iteration of that, where you're going to have to kind of go back to the drawing board and figure out what keeping the core values means for the next iteration. So it was interesting to hear your kind of takes on that.

Ken Gee:

I think we have it in place. I think we have it in place. It's just continuing to let it grow. Yeah.

Dave Morgia:

Yeah. That's awesome. Ken, as long as you're ready, I'd love to just dig into these five key questions before you run out of time. Okay, go ahead. To the first one is if you could only pick one trait that explains your success. What is that trait? And why?

Ken Gee:

Yeah, it's the trade is being brave enough to get out of my comfort zone, pushing yourself out of your comfort zone on purpose. When you first start doing it, it's really scary. And it's really uncomfortable. And it's still uncomfortable, it's a little less uncomfortable, because you know, I'm going to get there, I'm going to get there. So it's that it's that pushing yourself out of your comfort zone is probably the number one reason because I firmly believe that there you know, that you if you look at, you know, the super successful people in the world, there's no difference between me and them. Just they figured out how to put themselves in the next place, so to speak. That makes

Dave Morgia:

sense. Yeah. hurdling, the fear. Pretty much got them. Yeah. There we go. Welfare. Yep. Yep. And then now can What is the most uncharacteristic thing you have done in your business? And why did you do it?

Ken Gee:

uncharacteristic, for me, personally, is marketing either. So for me, it's been marketing as a company. You know, I were really slow and deliberate. I don't know that there's a uncharacteristic is a fairly strong word. I'm not sure that there's anything that you know, I would regret as a company doing. I don't, I'm at a loss there. But personally, I will tell you that this whole, you know, getting out and marketing and even being on this podcast, you know, for 20 years, I was very comfortable not doing that. And what I've learned now, is it is an enormous amount of fun, sharing what we've learned over 20 years with people who have only been doing it a year or two, right, somebody did it for me, way back when, and now I feel good that maybe I can help them a little bit, and their way on their journey to doing what we're doing now.

Dave Morgia:

Yeah, it's it's a fun muscle to flex. And it's unbelievable. The amount of content there is out there these days. So to put a little piece back into that ether is fun for me to say, it is yeah. And then can you name a time where you felt like you weren't going to be successful? And how did you overcome that fear?

Ken Gee:

Yeah, that's, that's a good question. You know, if you're running your own business, I always tell people, you need to be prepared for really high highs, and really low lows, right? Because you're sitting there eight o'clock at night, you just, you just lost a deal. You can't believe you got outbid you were sure you were going to get it and now you didn't get it. So what do you do? Right? What is important is that you figure out, you stop for a minute realize this is not a failure. Okay, let's learn from this. What happened? Why did it happen? Is there anything I could do to change it? Right, learn from it? And then Okay, let's move on. Let's take what I've learned and apply it and move forward. So that I'd say that's the number one thing.

Dave Morgia:

Yeah, then pretty much flip to that one. Can you name a time where something in your business went perfectly? And what did you do to make that reality? Yeah,

Ken Gee:

I mean, I always think everything we do, we could probably do better. Because I'm a pretty critical person. I just do. But you know, what, what's most rewarding? I mean, it depends on which side of your business we're talking about. Let's focus on the investment side. So it's really fun, and really rewarding when you send an investor. A check, that is way more than he ever thought that he would earn on any investment. And he calls you, and he thinks you made a mistake, because he thinks you gave him his money back twice. That's a

Dave Morgia:

good one right there.

Ken Gee:

Right. That is so cool. And so far, so rewarding. That so there you go. I again, you know, could we have made a mate? Maybe I could figure out okay, I should have done this, we probably would have made more. But you know, at some point, you got to stop with that. But yeah, that that would say is the best. That would be my best response to that question.

Dave Morgia:

And then we flirted with this one a little bit already. But what have you been focusing on lately to improve yourself for your business? Ken?

Ken Gee:

Yeah, I you know, I always tell people, it's funny when you go to school. I can't wait to get done. This is horrible. I just want to get out in the real world. Right? Well, then when you get out in the real world, you realize, wait a minute, now I really want to learn sad this conversation with my daughter recently, suddenly, you're out of school. Now you realize, oh my God, there's so much I don't know. And now you really want to learn it. Because now you want to be really good at it. So the number one thing that is made a difference for me is just, I'm constantly reading. I'm constantly on YouTube trying to learn things. I'm constantly going to conferences and seminars, and, and reading so it's that thirst for for new knowledge, because I don't I don't know that you can ever, you know, learn enough. I mean, I've probably forgotten more than I care to admit. But it is that that's the number one thing I would say.

Dave Morgia:

Yeah, and I think once you get that bug, you never stop learning or you're never going to lose that drive to keep learning. Even if you think you mastered real estate you might start flirting with a different avenue of real estate or, or you know, there's always something that you haven't Yeah, to someone else's achieving that you're like, I need to be doing that.

Ken Gee:

Well, yes, but you know, if you're doing real estate real, any business is always gonna throw plenty of curveballs at Oh, yeah. I'm just looking at the pandemic, the recession. Think about all these things, right. There's, I don't know how you could be bored.

Dave Morgia:

Yeah, it's certainly funny, can appreciate the time, it was interesting charts show. And I like the shows where it's fluid. And we just kind of go off and find some little tangent started with kind of the how you vet a sponsor, really funneled into how you model your business, and what morals you put behind it, and basically, who you look for internally and externally for partners. So I just want to thank you for the time. And before we sign off, you just want to kind of let the listener know about the book that you mentioned. Yeah, they can reach you all these great things. Go ahead and plug

Ken Gee:

that. Absolutely, thanks. So it's K ri partners.com/ebook. Drill easy. K ri partners.com/ebook. The name of the book is multifamily real estate. So total game changer. I wrote it myself. It's free. Again, it talks about it helping everybody figure out how they're going to fit into this real estate world because there's a bunch of money to be made. And you'd be so you'd be crazy not to think about getting into it. And then once you know once you decide that you probably should be passive, which most people should, then how do you how do you navigate the sponsors and and the syndicators and how do you find the right fit for yourself? I think those are two valuable things that I can hopefully help people with. So yeah, K ri partners.com/ebook. Thank

Dave Morgia:

you once more for your time, Ken, really appreciate it.

Ken Gee:

Thanks for having me.

Thank you for listening to the show. I don't take your time and attention for granted and appreciate that you would spend it with me. If you enjoyed this show or any of my previous shows, it would be a huge help if you would rate and review the show on Apple Podcasts or your favorite podcasting service, or even just share the episode with a friend. And if you'd like help from me or would like to talk about real estate investing further, feel free to visit the show notes for more information, or you can visit davidtravis.com.

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5KQ1 - If you could only pick one trait that explains your success, what is that trait and why?
5KQ2 - What is the most uncharacteristic thing you've done in your business and why did you do it?
5KQ3 - Can you name any time where you felt like you were not going to end up successful? How did you overcome that fear?
5KQ4 - Can you name a time where something in your business went perfectly and what did you do to make that a reality?
5KQ5 - What have you been focusing on lately to improve yourself or your business?