#106: Coronavirus and the 2008 Housing Market Collapse

Welcome to The Accelerated Investor Podcast with Josh Cantwell, if you love entrepreneurship and investing in real estate then you are in the right place. Josh is the CEO of Freeland Ventures Real Estate Private Equity and has personally invested in well over 500 properties all across the country. He’s also made hundreds of private lender loans and owns over 1,000 units of apartments. Josh is an expert at raising private money for deals and he prides himself on never having had a boss in his entire adult life. Josh and his team also mentor investors and entrepreneurs from all over the world. He doesn’t dream about doing deals, he actually does them and so do his listeners and students. Now sit back, listen, learn, and accelerate your business, your life, and your investing with The Accelerated Investor Podcast.

Josh: So, hey, everybody. Welcome back to Accelerated Investor. I’m so excited that all of you could join us. And for all of you that have been asking questions about what’s going on and asking questions about what do I do in this uncertain time. Thank you. Thank you for reaching out to us. Thank you for sharing your concerns, your fears. That’s why we’re here. It’s just to talk to you about what we’ve learned and how we can lead in this uncertain time. Thank you for sharing this podcast on social media. And today, have a special guest. All of you know him. His name is Rod Khleif. He’s an amazing apartment investor, an amazing business leader. He’s been owning and growing companies for over 30 years. He’s a leader in this space, not only as an author, a speaker, an investor raising capital, owning apartments and many, many other companies and businesses. And you also know Rod, I just had him on the podcast about a month or two ago.And the world, a month or two ago is very different. So I’ve asked him out to come back and for he and I to share some of the lessons that we’ve learned from the crash of 2008 and not only to lead, but thrive in this uncertainty and what to do both mentally and tactically going forward. So, Rod. Thanks for popping back on. We’re so excited to have you back.

Rod: Yeah. Thanks. Josh this is going to be a lot of fun. And you know, I know it’s not fun out there right now. Sometimes I just have to go outside and look at the birds and realize everything will be OK. But like we were saying before we started recording, it’s almost a little bit surreal. Like it’s almost like a bad movie sometimes. But the thing that that people have to remember is that. But, you know, let’s talk let’s talk first about, you know. You know, I love talking about mindset. I spent 20 years following Tony Robbins around the planet. And, you know, I love talking about mindset. And honestly, guys, that is 80 to 90 percent of how well you do through this. Right. It’s all between your freakin ears. And so the thing that the things you need to remember right now is, you know, when you’re looking at CNN and ABC, Fox, the news is not there to inform us. It’s there to scare the shit out of it, to startle us. OK.

Rod: That’s what is therefore, that’s what they do leads. That’s right. That’s how they sell advertising. And so. So remember that number one. Number two, remember that what you focus on grows, positive or negative. And so, you know, if it’s the news, you’re going to get more and more frightened and scared and paranoid versus if you did, you know, if you if you re-associate with the things that you want. You know, I think on our last call, I did my version of a goal setting workshop, how to maximize, you know, what you want and why you want it. If you re associate with that, you get some pictures of things you want. You get vision boards, you get a line. Right now, average people are watching Netflix, watching every frickin series on Netflix and distracting themselves with entertainment where the successful people are growing and learning and becoming more. Because this is an opportunity.

Rod: Now we’re gonna talk about the opportunities coming in multi-family. Trust me. And and it’s coming. You know, both Josh and I went through 2008. I lost fifty million dollars. I don’t know how bad you got hit. Maybe you didn’t get hit at all, but I got my butt kicked. And so this is a little bit déjà vu ish for us. Now, luckily, our asset. I’m only in multi-family now. And our assets, we collected eighty five percent of our rent already. It’s the 9th of April when we recorded this. So, you know, we’re doing quite well with our asset class. Yeah. And you know, we were very, very proactive. You know, I on my Facebook page, I went live about this, how to deal with your residents right now, how to be proactive, how to talk to your lenders right now, how to, you know, get ahead of this. So that is, you know, you can’t hide your head in the sand as an operator or frankly, as a human being right now. Right. If you’re watching or listening to Josh, you’re a leader. You’re either a leader of your tribe, your company, definitely your family. There’s no question. And everybody’s watching you right now. They’re watching how you handle this. Are you hiding your head in the sand? Are you caught up in fear or are you focused on the things that you want and growing and learning and, you know. And right now, you know, you have to innovate. You have to pivot. In fact I just went live on this two nights ago. Yeah. You know, some of the biggest companies on Earth were born in a crisis like this.

Rod: Hershey in 1929, when the market crashed. In fact, Tim Bratz posted about this, you know, Tamiya for everything and I got this from him. So give him credit for it. But it was a very interesting story. How Mr. Hershey, Milton Hershey came out of retirement to come save his company. And he had to pivot because nobody was spending money on what they thought was frivolous, things like chocolate. So what he did was he repositioned as, you know that it was nutrient, that it was packed with protein and nutrients. And they had their biggest year ever. Me personally, you know, I was scheduled to have 700 people in Orlando at my next sold out live event. Every one of my events is sold out. I had 700 people on.

Josh: I was trying to get there for that.

Rod: You were going to tell them what you were going to come in. And so I had to pivot. And so we’re doing a livestream on May 2nd and 3rd. And that’s OK. I’ve got my, we’re working on my studio. I’ve got somebody fix building some things over there. And one of the other buildings here, my compound today, actually, for that. But I had to pivot. And so if you’re out there and you’re suffering right now or you’re you know, you’ve got a job situation or whatever business you’re in. You know, we went through some pain. I had to I had to cut my leadership staff down. I had to let a couple people go. I mean, it’s not pleasant. Hopefully I’ll bring them back. But you’ve got to get ahead of this. And focus is the critical piece.

Josh: Well, it’s it comes down to understanding that if you take a long-term approach, Rod, and you think, look at the longevity of my company is what’s important. The longevity of the people that I can impact is important. I might have to make some tough decisions today as a leader, but to make some tough decisions, to let a few people go furlough some people, consolidate some things for the long-term health of my company. The long-term health of all my students, all my investors, all my tenants. I’ve got to make those decisions for the long-term health, not knee-jerk things, but think what’s the best decision I can make today that I have to make? Right. To me, this is a almost like a just a natural disaster. This doesn’t feel like 2008. It doesn’t feel like, you know, the mortgage crisis that was going to drag on for three to five years. This feels like a natural disaster, more like a hurricane or a typhoon or, you know, something along those lines that everyone’s freaking out for this 90 day period. It’s going to have significant impact for 90 days. There’s gonna be some people that businesses get crushed because they’re overleveraged or not liquid enough in the next 90 days. But this doesn’t feel like to me like 2008 that because that rolled in, if you remember.

Rod: I mean, let me say this to that. Yeah, let’s say this to that. And I interviewed a doctor for my show and I didn’t air the episode because it was just too negative. But he does think that this is the new normal, at least from the social distancing standpoint, because until they find a cure or an antibody or something to prevent this, they’re going to. He thinks they’re going to be waves of this. Now obviously people cannot shelter in place for much longer. So, you know, I think I think what they did was they made sure that the hospitals had the capacity and the resources to handle this. But I think it’s going to I think it’s going to go more towards. I mean, this I’m thinking this as it relates to my business right now and the thought leadership side, not on the apartment side. I’m on the thought leadership side with my live events. And so, you know, I’m pivoting there in case he’s right. OK. He thinks it’s gonna be three to five years on this social distancing, work remotely, do, you know, things of that nature is going to become much more mainstream. Now, hopefully he’s wrong. Honestly, I do hope he’s wrong, but I’m positioning as if he’s right. So I went out and bought some domain names like, you know, I’m going to do an online meetup framework for investors. I got, you know, online multi-family meetup.com and I got some domains. I plan to set up a national meetup group. It is one of the things on our plate. And I think I think it’s really.

Josh: You’re planning for the worst, right? Hoping for the best.

Rod: Planning for the future, honestly. And it doesn’t have to be a negative. You know, it’s a pivot. And if I go at my love the live events, my wife loves the live events. We love shaking hands, hugging, connecting with people. And if that’s going to be a while, then, you know, then then I’ll pivot and, you know, I’m do a livestream. It’s going to be kind of weird because I won’t be actually actively in front of anybody, but I’m going to bring in people on zoom and stuff. But the point is. I think you plan for the you you’ll hope for the best and plan for the worst is what kind of what, yeah, I think you just said that and that’s kind of what I’m doing. And as it relates to the training business.

Josh: And that’s it, that’s forcing you to reinvent because what you said pivoting, because now let’s assume that it isn’t the worst. But you create this online meetup, you create some of these tools to be online. But let’s just say a year from now or six months from now, things are back to the old normal and you could do your events. Well, now that becomes a whole new asset. Exactly. To your events as well. Exactly. And you’ve pivoted. And you’ve created from that.

Rod: Exactly. But those of you listening. Think about what you could do, a side hustle. Something that you would take this opportunity when you’re stuck in your home to learn and grow. For God sakes, if you’re interested multi-family come to my livestream. It’s ninety-seven dollars. Right. Drop a link in the show notes for that. Yeah. I mean it’s just in fact. You just text. Rodlive. Rodlive to 4 1 4 1 1 and it’s ninety-seven dollars for two full days and me training, it’s not a sales pitch. It’s gonna be friggin awesome. But the point is, whatever it is, it doesn’t have to be multi-family. Take this opportunity to learn something that you can kick ass with. You know, regardless of what happens down the road. OK. That’s my message. And don’t get caught up in the fear. Remember, people are watching you. You’re a leader in whatever you focus on is going to get bigger. You know, I love to tell this story about Mother Teresa, you know, about focus and in what you focus on is critical. And people would ask her if she was anti-war and she would say, no, I’m pro peace. Oh, there you go.

Rod: See? What a great mindset there. That’s right. And there’s so much good stuff out there. You know, I got to stand guard at the door to your mind. And, you know, I don’t watch the news and, you know, on TV for sure. I’ll glance at it. Just to stay on top of the headlines in the morning, sometimes just for freaking amusement. But the point is, you don’t you don’t wallow in it. You really the word is indulge. Don’t indulge in the fear. OK. That’s you know, I know that didn’t sound good, but that’s the truth of it. Yeah. You’re watching it for more than 30 minutes. You’re indulging in it. OK. It’s giving you certainty. So be sure that you know that you’re focused. I mean, I’ve got my vision boards here. I’m focused on the things that I want. I take you know, I’ve reconnected more connected with my wife who’s walking by right now. And she’s running off in case I ask her to come over. So the point is we’ve connected more we’ve done more walks, of course, that people are joking about that. But what a great way to connect with those you care about.

Josh: I always thought yesterday there’s that there’s this amazing gorge outside of the Cleveland Metro Parks and there’s all these massive rocks and valleys that we can climb through.

Rod: Jogged. I’ve jogged it. I remember jogging it, actually. Yes.

Josh: Yeah. Whips Ledges. It’s called. It’s amazing. And I went there as a kid. So the last couple of weeks, I’ve been taking my kids there like once a week, every two weeks. And we’re just checking out new parts of it. And the kids are like, oh, dad, parks are boring. And then I’m like, not trust me, like, just come and see this. And the kids love it. Like dad, that was so much fun. And we’re eating more meals together, connecting as a family, using that as an opportunity, going for walks, playing out the yard. And I’m lucky because I get to work from home a lot as it is. Right, Rob? And I’m here. My kids a lot as it is. But this is a special time. And I hear a lot of parents bitching and complaining like, oh, I don’t know if I could do this with my kids so much. My kids are all in my business. I’m like, you’re missing the point. Like this is time to slow down. It’s a time to enjoy it. We’re kind of forced as a society to kind of just let’s just call everything down. Right. And enjoy each other. Think a little bit more. Read a little bit more. Work out a little bit more. Get some more exercise. There’s so many benefits from this. And if you miss it and just complain about your old life, the whole point here, Rod, is it’s your focus. Take the best parts of your old life, maybe 30 days ago. Take the best parts of this part. This 30, 90 day, six month and merge that together. That becomes the new you. Six months or a year from now, there’s tons of positives that are coming out.

Rod: Oh, no. No question. No question. And I will I will tell you this. You know, you listening. If you are really suffering right now, I promise you, there’s a silver lining in all this. There always is. You just have to find it, OK? Like when I lost 50 million dollars in 2008, that pre-framed my finding my wife. And I will tell you, I would give it all up again for her. And so and I mean that sincerely. And so. So the point is there’s always a silver lining. And but you can create that freakin silver lining if you direct your focus and you take you know, you take this as an opportunity to do all the things you just described, because it is it is an opportunity. And that’s how you have to look at it. You don’t look at it like it’s a negative. You look at it like, how can I become more right now? How can I grow? How can I learn? How can I start a side, hustle or do something I’ve always wanted to do? Or all the things you just described with your family? Tell you this now. Never mind. I was going to take that park. You went to actually jog that thing and actually got a hernia from that part right there. True story. I had surgery. So anyway.

Josh: Well, Rod, listen. So what are some specific. So again, mentally, like somebody wake shore up there and ensure they’re feeling your interview. Yeah. If you haven’t. What are your tactics that they can actually do with it? Is it the vision board? Is it writing journal? Yes. What is asking you to teach your people, your audience to say, well, don’t just wing it. But here’s some actual tactics. Tell us about that. Yeah. Here you go.

Rod: So. So first of all, this is not self-serving. But I did a whole a whole hour and a half Facebook live on my Rod Khleif’s official page on January 1st, teaching people to walking them through a goal setting process. OK. Because again, what you focus on. Gets bigger and, you know, if you don’t know what you want, how the hell are you ever gonna get it? You’ve got to know exactly what you want and why you want it. So if you go to my Facebook page, I even give you a free download of a goal setting worksheet you can use in what. Spend an hour and a half with me and get clearly aligned on what it is you want. OK, that’s step one. You’ve got to know what you want, whether you do it with me or not. Sit down and write down everything you ever want in life. And or listen to the previous episode I did. I kind of highlighted it in about five minutes. But if you want me to walk you through it, it’s free. It’s there on my Facebook official page. Now, once you know what it is you want, you got to have it around you.

Rod: You’ve got to get pictures. You got to get pictures. You know, I’ve got I’ve got like this. I want to build schools in Latin America. OK, self-sustaining schools. You know, these are this is my travel board. I want to I want to go these places I’ve been or want to go again. You know, the things. And then. But remember this. And I talked about this when I was live with you the last time. Everything starts from gratitude. OK, you got it. But you got it. This is a gratitude board. Pictures of my kids and things I’m grateful for. So you gotta do that. And I think I showed you on the last episode. These pictures in the back of my planner. I’ve got pictures. Been in here for 20 years. Did I do that? Yeah, that’s. Yeah. And I’ve gotten everything in here. I mean, big things. You know, crazy exotic cars and houses. And, you know, all of it happened because I’ve put it into my reticular activating system, into my, you know, like on the walls. You can’t see it in the walls here. I’ve got pictures of the things that I want as well. I have it around me so that I don’t lose sight of what it is that I want. That’s number one. Then you really should have a morning ritual right now more than ever. You need one right now. You need to get up and you need to be here. I’ll give you mine.

Rod: OK. I had Hal Elrod on my show. I don’t know. We have yet. But he wrote The Miracle Morning and it’s a book about starting your day off. Right. But that’s a great book. If you don’t have it, go get it. I’ve given away hundreds of copies, but regardless, I’ll give you mine. It takes literally three minutes. So I’ll just close my eyes. I’ve got a recliner behind me here behind my green screen. You see the edge of it there. I’ll close my eyes and I’ll just be grateful for the things that I have in my life. My beautiful wife, my coaching students, my kids, my foundation. And just gratitude for just a minute or two, it’s easy. And then I’ll be grateful for the things that I want in my life, the positive things, not the fear things, the positive things, both material, whatever they are, whatever is important that you want to manifest.

Rod: And think about those things as if you already have them with gratitude. And I’ve even gotten emotional thinking about things that I don’t even have yet. You know, because I just really bring the gratitude in. And I know I lost some of your analytical ones are gone. Oh, good God. You off the fufu deep end. Well, I’m here to tell you. You know, there’s a reason I had 50 million to lose in the first place. And I’m back to the success that I have now. So poo-poo all you want. But, you know, unless you’ve done better than that’s not ego, then then please hear me because this shit works, OK? Sorry about the profanity, but I wanted to impact on that one.

Josh: Grandma always shit, damn, and hell weren’t swear words. Rod. My ninety- four year old grandma who’s still alive. Shit, damn, and hell weren’t swear words. So we’re good with us.

Rod: All right. Good. So, so the bottom line is it freaking works. OK. And so then then you do that morning ritual and then I always, this is really important to last little piece. Just say it’s gonna be a freaking awesome day. And it almost always is. And so you need to be exercising more right now for sure. Okay. I don’t care if you’re at home. There are YouTubers out there. You know, everybody in the exercise business can’t go to a gym right now. So they’re all online teaching for free and building their own brands. Go on there and follow it along. My wife’s been doing the crazy one, the insanity one. And I mean, that’s why, you know, it seems she’s drop dead gorgeous. Man, I’ve done that one. That’s hard. It’s brutal. I mean, it’s brutal. I can see her on the security cameras is like, oh, my God, she’s an animal. But the point is and I’ve been working out harder, too. And I had you know, I had a trainer come in here. We’ve got an exercise room here, my compound. And we’ve been doing it on face time. And I got a little stand. He’s kicking my butt. No. No. Oh, yeah. Hey, quit Slacking, Slacker. And he’s telling me and I’m working out. And the point is adapt. Pivot, innovate. You know, think about it like like I had I had to pivot and innovate with my business. You know, let’s talk for a minute. Also.

Rod: I mean, I’ll let you guide the conversation, but you know, let’s not lose sight of the incredible opportunities that are coming, guys, both to buy businesses, to buy multifamily for sure. Real estate.

Josh: All right. Let’s talk about because in 2008, many people saw this. This is everyone. It’s funny how you and I’ve been around long enough to see it in 2001, the stock market. Everyone talked about, oh, the stock tech bubbles, the new normal. Until it wasn’t. Then in 2008, the real estate market’s the new normal. Until it’s not.

Rod: I’m older than you. Let me tell. Let me share. So. I’m sorry. Back in the late 80s. Yeah, back in the late 80s, I had I was flipping some houses. OK. So I had flipped. I love telling this story because it’s so dramatic. So there was this house in Denver on thirty three fifty one West 30th Avenue. Right. At federal and 40. OK. So anyway I I but I flip this house. I bought it for fifty-six, sold it for seventy-six. Made a nice chunk. OK. The market crashed. I bought it back for 18. OK. And everybody’s doom and gloom. Oh my God, it’s never coming back. It’s horrible. Oh what are we gonna do pulling your hair out. I sold the house like three or four years later for one sixty. It’s now worth about eight hundred. OK. So. So, guys, real estate is the freaking bomb. OK. And if you heard it, I don’t know if you heard me tell. If you didn’t hear me tell my story back in 2008, I had eight hundred houses and I had multiple apartment complexes. It was the houses that pulled me down because I was too geographically spread out, right.

Josh: Yeah. They were all spread out. Yeah.

Rod: Right. And so. And what was interesting is my multi-family did just fine. It pulled back a little bit, maybe 11 percent I think is what it was. And it was somewhere around that for the country really 11 to 15, max was the pullback. Well, we do our underwriting where we’re gonna break even at thirty-five to thirty to thirty five percent vacant. Right. And in 2009, it only did 11 to 15 percent. So. So again. There are incredible opportunities coming and, you know, like you said, there are businesses that were there were going hand to mouth. It is sad as hell, honestly, that they, you know, these individual businesses are going to are going to fail, but they are. I hate to say it, guys. A lot of businesses are going out of business over the next, you know, two to six months to a year because they just couldn’t hold on. I just saw cheesecake factories out. And and so the point is and the big ones even. But so there’s opportunity there in the multi-family space. I saw so many skinny deals the last few years where guys buying more we’re investing final in the phrase there’s like three of us. And we see what this thing sells for. And we’re like, what were they thinking in? And they’re coming back. I’m just telling you that, you know, and, you know, like on our deals, we’ve got a deal right now.

Rod: We’re closing in Cincinnati and a really good deal. Two hundred eighty units. We can sustain thirty five percent economic vacancy. OK. Which is huge. Number one. Number two, we’ve got a million dollars as a just in case as it hits the fan bucket. OK, million bucks, which is more than our mortgage payment for the year. So, guys, it’s not a time to run and hide right now. There will be. And that’s an incredible opportunity. We’ve still got slots left in that, by the way. But but it there will be even more opportunity coming and so we’ll run out the. And I will say this. Back in 2009, I was hiding under a rock for a few months. OK. And I missed out on our opportunity. Yeah. Because I mean, I’d lost everything. I thought I was set for life. I’d lost everything. That’s my excuse. I pivoted, finally. Took me longer than I did this time. I did it immediately this time because I knew. But the point is. Don’t get caught in the fear anyway, sorry.

Josh:So let’s talk tactically then about multifamily, because we’re about multifamily investor world. We’ve got four hundred twenty-six unit that we’re about to close on. We actually signed the papers yesterday. And guys that kind of saw this potential recession coming. Guys like you and I; we knew there’s gonna be deals on the back end of this, even in a no corona virus issue. But the coronavirus sped all that up. So we got liquid. We were waiting for deals to come. We saw those skinny deals. We passed on them all. Now, guys like us, a lot of experience, a lot of access to capital, can sign a personal guarantee. We’re going to be scooping up a lot of deals here in the next three months to 15 months. Now, there’s a lot of guys maybe that don’t have the balance sheet or the access or the experience. So let’s talk about one. Where is this deal flow going to come from? What are you looking at? And two, even if they don’t have a lot of extra money or they don’t, they don’t have a lot of expense. How can someone participate in multi-family maybe being a deal finder or maybe wholesaling deals, participating in a deal like that and partnering with an experience guy like us?

Rod: Exactly. Exactly. And I mean, you just pretty well said it. It really is. First of all, you have to learn the business again for ninety-seven dollars. Come see me for two days, you know, sign up for my course, it’s brainer to me. But even if it’s not me, go learn the business. But the point is then then what you’ll find what’s beautiful about multifamily is it’s a team business. And so, you know, you can bring one piece of that team. It could be deal evaluation. If you’re super analytical, it could be out there pounding the pavement, talking to brokers and owners to buy property. You know, in my in our acquisitions team, we’ve got two people that do the acquisition side, you know, broker contacts, sell direct to seller marketing. We’ve got two people in the investor relations dealing, you know, talking to our investors, which, you know, they’re needing a lot of hand-holding right now to hear what I just said, not don’t get scared right now. Get freaking excited. OK. There’s that. Then I’ve got two people in our asset management department and then Robert oversees the whole thing. And then. And so there’s lots of places that you can add value. You just have to figure out what your super power is and align with people. In our coaching program, we’ve got our three hundred and fifty people, people all over the country, and so many of them get together and with complementary skill sets to go out and do this business. Right. And you know, people like Josh, you and I, we can act as sponsors on deals. You know, our team and your team. And so there’s just that.

Rod: The point is what the beautiful thing about our business, is it. Yes, it takes some money, but it doesn’t have to be your money. OK. There’s so much money on the sidelines looking for decent returns. Good. Look at how many people got freakin crushed in the stock market. The feds don’t bail out the stock market, but they’re bailing out renters and doing defenses and forbearance on property owners. OK. That’s a clue. OK. Yes, we call a clue because people have to have housing. And so, you know, that’s why real estate so awesome. Forget, you know, all the other benefits, like the incredible tax benefits. Why do you think the wealthiest people on this planet put their money in real estate? So they don’t pay taxes!

Josh: OK. Even yesterday we got our K ones coming out. Right. So I was talking with my partners last night and one of our investors like, hey, I actually received this money in a preferred return. Right. But my K one shows that we lost money. So now you’re saying that the dollars I got in my preferred return were offset by depreciation and expenses. So I actually made money that I can spend real cash, but I’m actually able to write this off as a loss on my tax return. Yeah. Oh, yes. Now you’re getting it, you’re getting it. The K 1 band. That’s the proofs. So now you did a podcast and a call for our investors just on that? Because it’s so amazing. And people like you said, rather, that we’re fighting over four caps and 5 caps and deals that were super skinny. That’s now what’s going to happen. Guys didn’t get knocked down. Guys, I can’t pivot guys that we’re maybe posers in the business that really weren’t players that really didn’t have access to it. They’re going to be gone. They’re gonna be moved on. They don’t have the ability to pivot. And the next three months to 15 months, these deals are going to start to default or deals, sellers are gonna have to get out. Guys are gonna be squeezed. Cash flow don’t have any backup. They’re going to need to sell. And you’re really gonna be looking at pouncing on those deals.

Rod: And what’s the secret? The secret is cash. But it doesn’t have to be your own. You just have to have access to it. So if you know this business and you can congruently communicate what’s coming and the benefits that are coming, you’ll have access to cash because you know, and it really is that fear conversation with someone telling an investor that, hey, when there’s blood running in the streets, don’t be fearful, be excited because it happens if you study it. It happens all the time. Well, not all the time, but it’s happened many times throughout history where the people that were contrarian and that’s the word is, it’s contrarian investing, investing when the market is again blood running in streets. Best example I can give it. It’s a little graphic with the book. But the bottom line is you get the message. That’s when you want to be investing and not fearful and even, but the beautiful thing about multifamily is, again, we’re close on a deal right now. It’s a screaming deal. And since, say, we’ve got another one you and I were talking about in your backyard in Cleveland. A screamin’ deal.

Rod: And so the deals are there right now, but there will be many more of them. But, you know, the beautiful thing about multifamily is it’s primarily empirical. The numbers, it’s the numbers. Yes. You have to ask all the right questions. I don’t know if I. I mentioned I’ve got this free due diligence checklist this time on your show to download it.

Josh: Yeah, we’ll put a note for that in the show notes too.

Rod: Yeah, that’s. It’s just text rod to 41411 for this thing. It’s 70 pages. It’s every frigging question you could possibly imagine for due diligence. But with that and doing the numbers properly, it’s pretty freakin hard to make a mistake. It really is. I mean, if you have someone that understands, you know, the returns and doesn’t get too aggressive with the, you know, with what they think the rents are going to do and really the name of the game right now is to look at things conservatively. That’s how we’ve always done it since I got my butt kicked. You know, I’m very, very conservative any way, which has really served me right now. But the point is, if you operate that way, multifamily is a fantastic vehicle regardless of what’s happening out there.

Josh: Yeah. Whether you’re active, you’re an active operator, passive. Some of them are massive. Yeah. Right. Some of the moons that have lined up and you’ve seen it is because of the virus, a lot of the contractors that were so busy 30 days ago, 60 years ago, 90 days ago, they’re not there. They’re not busy. So they’re looking for projects to jump on multi-family owners to brokers that had gone through them.

Rod: It was almost hard as hell to get a hold of a broker, you know, up to six weeks ago. And now they’re calling us. No, no.

Josh: Right. And capital. Right. Because the stock market’s come down. People are like. I know. Like they knew it. They knew it. But they didn’t want to listen to guys like us 60 days ago that the market would go down by 30 percent. Then it did. So you got contractors that need work. You’ve got brokers that need buyers. You’ve got passive investors that need to invest and get a good solid preferred return and safe, solid, stable. All these things are lining up now. So if you’re not aligning yourself in multifamily, you’re going to miss the boat. If you look at the guys in 2009, 10, 11. The Black Stones of the world is the first one that stands out. They became, they created a whole new market of this single family for rent on an institutional level. That did not exist before two thousand and eight. They saw that opportunity. So how can you do that now on a multi-family capacity? Because I’m not going to go buy fifty thousand single families like they have.

Rod: I’d rather you don’t want to own a single family. I’ve own two thousand houses I rented long term. Trust me. Don’t do don’t do that. OK. Just don’t do it. But that the you know, this business, like any business, is two things. People and systems. You’ve got it. You’ve got to find the right people to align with for your team. You know, and you know, and ask the hard questions upfront. And, you know, trust your gut. But then you have to learn the systems. And it really. That’s it. It’s systems. And, you know, we’ve got everything check listed. And, you know, that’s what we train people to do is to work from checklists. So nothing gets missed. You know, go you go to McDonald’s. They’ve got a checklist for, you know, how much how much stuffed coke to put in the cup and everything else. And, you know, it’s like the book E-myth. You know, that’s every business is that. And so. But now is the time to learn while you’re stuck in a freakin house, you know, on the computer and learn this business. And, you know, there will be incredible opportunity. And I think it could even go longer than 15 months. You listen to my podcast and you start listening to the guys that have a thousand, 2000, 3000, 4000 doors. I would say 90 percent of them started in nine, ten and eleven. Yeah, sure, clue. That’s a clue. OK. So so that’s going to happen again. And I’ll tell you this time, I will.

Rod: Well, you know, I pivoted back then and I reinvented myself and I started litigation support company and I built law firms in five states and we helped thousands of families save their homes. It was beautiful. It was great work. I hated the business because people are never happy when they’re losing their homes. But it was fantastic work. I sold the business last year and it’s gonna kill it now because that’s happening again. But the point is, so I didn’t get back into real estate and do like Blackstone did. I could have definitely done a Blackstone play because I had experience in it. Sure. But. Right now that the name of the game is knowledge and access to capital and with the knowledge, you can get the access to capital. OK, so you know, but you got to go. You’ve got to move now. OK. And you got you know, you’ve got to learn this business. Get out there and shake it up. Get around people that are doing this.

Rod: Like I said, I’m setting up a aa free multi-family meetup nationally. That’s in the works right now, meeting with the developer tomorrow. We’re gonna get it cranking and where we where people can actually network in small groups inside of this thing. It’s gonna be awesome because networking is out the window right now. And that’s a lot of this business is you’ve got to connect with people. So you have to do it on Zoom. You have to do it virtually in it, and it works. I will tell you, I we’ve been virtual in my company for two and a half years, three years, three years. And I mean, there’ve been times where I’ve hired someone and I meet them at my live event and hey, what’s going on? And just wave. And we’re walking down a hallway together and like, wait a minute. We never actually physically met side feel like you have because, you know, you’ve seen them so much.

Josh: One of my tech guys lives in Canada. I actually met him when he lived in the Philippines. And I’ve never met him face to face, but work for me for five years, you know? And when I got sick with cancer, I told you that story on your podcast. I shut down my office. I told everybody to work from home because I found when I was recovering from cancer, working from my laptop and my cell phone, I’m like, well, I’m actually getting a lot done from my master bedroom while I’m recovering here with this massive incision in my stomach. Why? Why would I ever go back to an office? So we’ve learned this over the years and I think the economy is going to move that direction more.

Rod: I’m definitely, definitely a lot more right now, no doubt. And, you know, every business is bringing in a virtual component entirely honest. Every business is if they want to survive.

Josh: Rod, you’re talking about learning multifamily bootcamp online. What are my kids doing? They’re learning online. They’re going to learn now as 11 and 10 and 8 yearolds how to learn online at school. And for us, adults like take advantage of the opportunity, go to Rod’s virtual boot camps coming up in a couple weeks. Do that because you can learn at home, you could implement that stuff, then plug into like Facebook groups, meetups, those virtual things. And then right when this thing opens up and you have another live event where it should come face to face.

Rod: Well, we’ll do that when the time is right. That’ll be fun. But again, guys, if you want to see me, it’s Rodlive. Text Rod Live, it’s one word to 4 1 4 1 1 or go to multi-family virtual bootcamp.com It’s a long domain. Multifamily virtual bootcamp dot com. But yeah, if multi-family is what you want to do, because even if you only want to invest passively, come to my bootcamp because why would you give someone money if you don’t know what the heck you’re investing in. Right. So you need a basic understanding. You know, people had trillion dollars in the stock market that went poof. And I’m going to tell you. Well, I don’t know. It’s just that would help them. But the beautiful thing about multifamily, again, is it survives. It’s if purchased. Right. It’s always your session.

Josh: People are always going to need workforce B, class B plus. Places to live that have been renovated, stabilized, and they’re proud of where they live. They’re always gonna have high occupancy. Like Rod said, even in the crash of 2008 9, maybe like 10 percent, but you go as vacant as 35 percent and still break even pay your debt service, pay your expenses. So Rod, listen this has been an incredible time just sharing with you kind of ham and was talking through the market. But guess what do we learn? We learned it starts up here. It starts between your ears, starts with your mindset, starts with getting up with the proper routine, starts with being someone who’s pursuing education, pursuing excellence, not letting the negativity of the news influence your mindset, but you positively and proactively setting your own mindset. Do that, learn new things online right now and then be ready because the next, you know, 12 to 18 months, there’s going to be a ton of deals that were not available to people were battling over, competing over six months ago even six weeks ago. That is going to be a huge opportunity. So if you’re looking to create massive wealth, get ready. Plug into Rod’s bootcamp and we’ll put all those notes, all those links right in the show notes here. Rod, so listen, thanks for carving out some time for me. Brother it was a lot of fun.

Rod: Love, love being around your energy, brother. Thank you.

Josh: You too. My man. All right. Stay safe. We’ll talk to you soon. Take care.

You’ve been listening to Josh Cantwell and the Accelerated Investor Podcast. Leave a comment on our iTunes channel and let us know what you want to learn next, or who you’d like Josh to interview. While you’re there, give us some five star rating and make sure to subscribe so you can be the first to hear new episodes. Follow Josh Cantwell and his companies, the Strategic Real Estate Coach and Freeland Ventures on all social media platforms now and stay up to date on new training and investment opportunities to start your journey toward the lifestyle you’ve always dreamed of. Apply for coaching at JoshCantwellCoaching.com.

You can’t hide your head in the sand as an operator or as a human being right now. I talk about getting your mind right with the Mindset King, Rod Khleif. Mindset is going to matter a lot as we go through this, and what you focus on will impact your behavior, your thoughts, and your business.

Take this opportunity to learn something, whether it’s a new side hustle or creating a new asset for your business. Rod has shifted his in-person training to a livestream event, and he’s purchased domain names for online meet-ups. And when this is all over, he’ll have a massive online platform AND he can go back to in-person training. He’ll come out of it stronger than ever.

There’s so many benefits from this, and if you miss the whole point here about slowing down, then you’ll miss creating a new best life for you. Now more than ever, you need a clear vision board of where you want to go with a heart full of gratitude. Rod recommends trying a morning routine as another way to orient your mind every day.

If you’ve listened to me for any amount of time, you know I’ve been preparing for a recession for a while. Rod and I talk about how you can get in on the amazing multi-family deals coming our way, even if you don’t have the liquidity to do that. This whole squeeze on real estate is going to sweep out everyone who was really a fake in the business and who doesn’t have the ability to pivot.

Rod and I were both investors through 2008, so we have a lot of experience with shifts in the market. And while there are some parallels to 2008, this shift is going to be quite different. Rod’s hoping for the best, but planning for the worst, and he opens up on what he’s doing differently this time around.

What’s Inside:

  • Remember that what you focus on grows, whether that’s positive or negative.
  • What’s the best decision that I can make today that I have to make?
  • Stand guard at the door to your mind and lead out with positivity.
  • Goal setting with Rod starts with physical pictures that help him focus.
  • Brokers, investors, and contractors are looking for work, and why that’s a great opportunity for you.

Mentioned in this episode​

Freeland Ventures
Josh Cantwell Coaching
Rod’s Livestream, text: RodLive to 41411
Due Diligence checklist, text: Rod to 41411
Rod’s Facebook page
The Miracle Morning

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