#130: Commercial Lease Options

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, everyone, welcome back to Accelerated Investor, this is Josh Cantwell, and I am so excited to be with all of you guys. And today I have a special treat for all of you. One of my very first early mentors in real estate. His name is Peter Conti. I will never forget, as I introduce Peter and bring him on the line, when I was a financial adviser in my mid to late 20s. I knew a lot of my clients that had money in the financial markets, stocks, bonds and mutual funds. I remember learning from them that their biggest assets, their most important assets, the most of their wealth was actually in their real estate. And I started listening and paying attention. I bought some books. One of the books was Multiple Streams of Income by Peter Conti. I read the book. I was on a plane. I’ll never forget reading it.

Josh:And years later, I was able to meet Peter himself at one of our kind of joint venture and affiliate summits. I’ve now been to Peter’s house. We’ve been friends now for years. And I’m so excited and thrilled to have him on our podcast today. Peter is the author of Commercial Real Estate Investing for Dummies. He’s done thousands of deals. He’s mentored thousands of students. He’s an absolute champion for real estate and for entrepreneurship. Peter, welcome to Accelerate Investor. How are you, my friend?

Peter: Hey, it’s great to be on the show. And for all of you tuning in. Thanks for joining us.

Josh: You bet. Absolutely. So Peter is hanging out actually at his is his compound, if you will. And I’ve been to his house for masterminds. I was thrilled to be there. And Peter, what I’d love to hear about now is because it’s been a minute since you and I have really had a personal conversation, even though we’ve known each other for years now. But it’s been a minute. So I’d love to know what you’re up to today. What are you working on? What are you thrilled about? What are you excited about after all your successes? And we’ll talk about your massive injury that you’ve had, but what are you thrilled about and working on right now?

Peter: You know, I’ve gone through some big changes, but I I’m excited about the Corona virus. I mean, that’s not the popular politically correct to say. But I am seeing just deals right now that I haven’t seen numbers like this in at least eight, ten, maybe fifteen years. I mean, we’re just coming across stuff where the way I see it, there’s people who are in two camps. There are the people that are, oh, my goodness, this is gonna be horrible. The economy is in a crash. People are going to stop paying the rent. We’re not going to be able to evict them. That’s one camp. And then the other camp is the people like I am. I think you are, too. Hopefully most of our listeners are were you know, were understand this is a problem, a challenge. We got to work through it. But people are always going to need a place to live.

Peter: Real estate is a good location. You can’t go wrong is just such a great opportunity to get deals from these people that are scared. They’re uncertain. So they become motivated sellers. And it’s given us an opportunity to either acquire properties, you know, on focusing on commercial, mostly apartment buildings with the people I’m working with right now. But acquire these properties, either flip them and make a, you know, quick assignment fee or find a way to bring an investor and maybe keep it for yourself. That type of thing just tremendous, tremendous opportunity. More opportunity out there right now than I thinkany time in my entire 30 years of investing. And that’s saying a lot.

Josh: Yeah, that’s in a lot. And I think it depends on who you listen to. Right. If you listen to real operators that are doing deals that are in the trenches, finding deals, coaching people to do deals, raising money, a lot of those people… I just had a conversation with one of my partners in our apartment buildings and we’re so excited about what we’re seeing versus the traditional news media and social media, which is all out to sell fear. And, you know, the sky is falling. And if you believe that you have a totally different view of the world, and I would again encourage people to listen to people who are actual boots on the ground. You don’t have to listen to me and Peter. Be great if you did. But listen to people who are really doing stuff, not listening to the news media. So that’s fantastic.

Peter: What better advertising campaign can we get then what the news media is doing?

Josh: Right, right. For sure. So, Peter, your latest sort of passion and innovation is this whole idea of commercial lease options. You wrote in a recent book around it. You’re coaching a lot of students around it. You’re finding great deals that way, but you’re also finding deals that you could just buy at a discount and hold or get under contract and wholesale. So just describe for our audience that might not know a lot about commercial deals or apartments. What is a commercial lease option? How does that work? What are the mechanics?

Peter: Commercial lease option: There’s three parts to it. One is getting a property under contract. You can use a commercial master lease is one method. We use owner financing or buying the property subject two. I hate that name, but it means buying the property, leaving the existing financing in place. And we’re also finding these days that we’re getting good enough deals. You know, one of our strategies is we just make a really low offer we know won’t be accepted. And just to get the ball and sometimes you know as well as anyone. Right. If there’s a broker involved, you’re probably not going to negotiate a creative commercial real estate transaction with the broker at all.

Peter:So one of our strategies is we’ll just make a standard offer, but have it be really low. What we’re finding is people know where they used to come back and say, what, are you crazy? We’re not gonna do that, which kind of opened the door for us to get in there and say, well, you know, what could we do? Why don’t the three of us get on a call together and maybe we can figure something out which allows us to maybe put a creative deal together. We’re finding that people are coming back and countering and we could go away off what they’re asking. And what they’re asking, well, shoot, let’s just get this thing under contract. So anyways, step one is here to get a property. These days, I’m tending to steer people towards apartment buildings. Retail and office, as you know, is going to go through a major price correction, or at least that’s where we want it. People are always going to need a place to live.

Peter:So we get an apartment building under contract. You control it. You are not obligated to buy it when you use the right agreements, but they’re obligated to sell it to you. In fact, we’re using an agreement right now where all of the stuff in there and depending on what they catch and they cross out, we can control a property for like four or five months, which is amazing. Right. So. So you get under contract. Then the next thing we do is we go through I call it the eight profit activators. We look for things that we can do to increase the value of that apartment building. And I’ll just use a case study, one that we’re working on right now. This week, we’ve got a 24 unit that’s under contract. We look for apartment buildings where the rents are below market. And in fact, that’s part of our strategy.

Peter: One of the first things I have my clients do is I show them how to build a database of the commercial properties in their area. There are some awesome tools out there right now where you can get not just the property information, but you can actually get the seller’s name, you know, not just their LLC, you get their name, their cell phone number, their email address. It’s insane. And then we put together campaigns to reach out and do two things. Number one, reach out to see if they might be interested in selling or have some motivation. Number two, we’re using other resources on the Web. Things like rental meter and things like that to do a survey, a rent survey of all the properties in that market area. And we’re looking for those properties specifically that have below market rents.

Peter: So, for example, we found this 24 units in western Maryland. The market rent is eight hundred dollars units. All two-bedroom units. Really nice mix. Very well taken care of, was built in 1974. It’s actually a Class B property. It’s been that well taken care of. And the market rent is for sure. Eight hundred a month. The last five units they rented at eight hundred. We’ve got one empty. We haven’t closed on it yet, but we’ve got that owner testing the market at 850 to see what happens. There are people in there get this. They’re paying as little as 590 a month. Know why they’re paying so little?

Josh: I’m going to guess, it’s an ownership issue, it’s a property management issue. Nobody’sbothering to raise it.

Peter: The owner, the owner manages it himself. He knows the people. You know, well, they’ve been there forever. And I mean, his laundry is at a dollar seventy-five when right down the street the laundromat is charging three seventy-five. So anyways, a profit activator number one, we’re gonna, you know, intelligently raise those rents up. We’re gonna do in a graduated process. You got to be careful these days with the whole pandemic thing going on. You don’t want to be seen as like the mean, you know, landlord coming in and raising everyone’s rents right away. The laundry, we’re gonna boost the laundry. There are automation processes, as you know, that you can set up the laundry where tenants can pay with their app. No more dealing with handling quarters. Or you can get a card reader thing put in there.

Peter: We found, one of my favorite things to look for when I go through properties, is extra space that you could rent out. I found these doors and behind him were in two different maintenance storage rooms that they’re hardly used at all. There’s like some old screens and, you know, a few odds and ends in there. Really no reason to have that. If you do have that in a property, there’s plenty room out back to put a storage shed and put the stuff out there. Those offices, each of them are going to be turned into a work at home office for people right now with a pandemic going on. Are you kidding me? You got a two-bedroom apartment plus for another. We got to find out how much we can get, 300, maybe 350 a month. Get your own separate office.

Josh: Leave the kids and the spouse in the apartment to hang out. Let them do their learn from home schooling and just go down the hall and down the down steps to your virtual office.

Peter: At 350 each. That’s seven hundred dollars. Straight to the bottom line, because there’s no other expenses involved in doing that. Other than making, you know, making sure we’ve got to have a little heat and AC in there. But then we were looking at, OK, what else can we do? This place has a huge parking lot. There are not even lines. People just pull up and just park wherever because there’s so much room. There is plenty of room to build garages. Carport storage area is gonna be added to this property. All of that’s going to boost the net operating income. And when we were talking to him, he was talking. This is built solid building. It’s a cinder block construction in the walls, the first two floors with poured cement floors.

Peter: I had a building like this in Denver once where you could bounce a basketball in the apartment above. You’re not going to hear it on the floor down below. And he was talking about how the block construction is actually built between the units and the hallway and between the units and each other and bingo, it went through my head like that’s one of the requirements if you’re going to turn something into condos. So I haven’t even a chance to check on this yet and see what condos are selling for. But we’ve got this one under contract for just under one point five million, one point four seven five. As it sits right now with the rents where they are, it’s worth almost one point eight million.

Peter: Once we do the increase in the rents, that pushes up close to two million. If you do some of these other things, adding the carports, the laundry, the storage rooms. Over two million if you do the condo thing, I’ve only ballparked that right now. But the rough number I came up with right away was 2.8 million units. This isn’t like, I know you do like, you know, really huge deals and stuff these days. This isn’t like a huge property. I mean, that’s a 24 unit, right?

Josh: Yeah. Yeah. But what a massive win. What a massive win. So, Peter, let’s back up for a minute and let’s talk just seven years ago. You know, you had this major accident. You just said you’re 60. So you were around 53 years old. You’re a wild man. You like to ride dirt bikes. And you had a major accident. I was at your house probably a year or two after the accident. And you were kind of winding down a lot of your real estate thing. You were going through a lot of physical therapy. So what happened that day and how did it change your life?

Peter: Well, I yeah, I was riding a dirt bike in my 50s, which I probably should’ve been smarter not to do that. I should’ve listened to my wife. She you know, she knew the history. I mean, I used to race dirt bikes back when I was a teenager and had a history of broken bones and all that stuff. But when you’re when you’re 16 years old, when you go flying through the air, everything would go into slow motion. You could see everything happening and you could, like, tuck your shoulder and roll and get up and dust off.

Peter: You’d be like a little sore for a few days. But, you know. You know, I mean I guess I did break some bones, but nothing serious. And when you’re older, all I can say is I was riding through the woods in this here scramble. It was a race. I promised my wife I wasn’t going to race, but I told myself this is gonna be like an organized trail ride. I’m not going to race. I let everything else go ahead of me. And then these guys behind me, they passed me. It was an 11-mile loop. They’re like, run, run get out of my way. They passed me. And I was like, well I can keep up with that guy. And the other guy goes, well I can keep up with him. Before I knew it, this clipped this tree and there wasn’t any slow motion. There wasn’t anything. One moment I was ride along, the next moment I was like laying on the ground.

Peter: What happened? I don’t know. I don’t know. I think my hand’s broken. So I got to do the whole helicopter ride and everything. And then when they’re working on me in the hospital that they crush, they put like my femur back into the hip joint that was in twenty-three pieces. Something about protecting the cartilage. What they ended up doing is crushing the nerve in my leg. You talk about tickles while all the pain went on a scale of one to 10, it went to like 200. They kept hitting me with morphine, morphine, morphine, morphine. I’m like, can’t you give me something for the pain. My wife’s asking the nurses, like we’ve given him enough to drop a horse. So anyways, they fixed me up and it was, you know, going through the process. And what happened is my foot hurt like crazy, but my hip was what was injured. But because the nerve was crushed up there, my foot just felt like a tiger had bit down on it.

Peter: And in fact, my brain reacted to that in a manner as if it was like the stone person days where there’s something wrong with my leg and my brain shut down. The blood supply. This pain loop got, they call it over sensitization. It’s actually called Chronic Regional Pain Syndrome, CRPS. It creates this loop where even when there’s nothing else wrong, your brain thinks there’s something wrong. And so that pain is still there. In fact, the temperature just from circulation in my left leg and my right leg.

Peter: It’s gotten better now, but at times it was like 10 degrees colder in my left leg just from my body, like trying to shut that down to say there’s something wrong. We got to you know, we’ve got to handle that. So I went through a whole thing where I was on really strong opioids, got off those finally. Got to a point where I was waking up every single day and my leg was killing me. And I just thought, that can wear you down over time. I never ever thought I would get this way. I thought people who thought of killing themselves were stupid. Over time I just got to where I’m not going to live way. I think I’m going to check out. And luckily I mentioned it to my wife. My daughter was there too, poor girl.

Peter: We’re out to eat at the Indian restaurant. I’m like, you know, I just don’t think I want to live anymore. I mean, I just, you know, check out. And my wife is on her cell phone call. And she’s got all our connections because she’s done so much stuff, even like she had me the very next morning at these 200 dollars an hour, the very best psychiatrist in the area who had these amazing meds. They can do great stuff with that today. He’s like you’re going to feel better this afternoon. I’m like, okay. And, you know, he talked to me, went through this whole thing. And, you know, you want to live or not. I’m like, oh, yeah, I want to live. It just, you know. So anyway. So I had that whole experience and got some great help to it.

Peter: But then I was coming up on two years in and a nerve injury is kind of crazy because if you don’t get out and move, it gets worse. It tightens up more. It hurts more. And I was having trouble just getting out the door to go walk Snickers. I realized that what I was doing wasn’t working. I’d been to different doctors. I talked to two different neurologists at one point that said, you’re never going to walk again. Don’t expect to get anything back. I, of course, said, you know, f- you. I’m going to find a way. And so I realized I was searching on the Internet for, like a lot of people do for answers. Right. I’m like, you know, nerve pain, leg pain. Doctor, I want to like someone that can give me a pill, put an electric gizmo on me, pull my leg something, just fix it. Right. And I realized it was going to be up to me and it’s crazy. I have a belief that you don’t have to know how to solve things. You just have to know how to ask great questions. I learned this from one of my mentors, Tony Robbins. So I wrote in my journal.

Peter: I wrote down, how could I turn this injury into an advantage, into a fun advantage or something like that by making it a challenge where other people would be cheering me on. I had no idea what was going to happen. Two weeks later, my wife and I went saw this movie. Wild: Reese Witherspoon’s character hikes the Pacific Crest Trail out on the West Coast. I started reading the books about people hiking the Appalachian Trail. I got this idea in my head that two thousand one hundred and ninety miles all the way from Georgia to Maine. You know, if I hiked that far, my leg would have to be better. I tell my wife, I said, honey, I’m going to hike the Appalachian Trail. She’s like, yes. Sure, sure thing you are. I mean, at this point, I was like laying on the chaise, watching Netflix, trying not to think about it, right?

Peter: Three weeks later, she dropped me off the train station. I went down to Georgia, started hiking the trail down there, did two and a half miles the first day, kind of went up from there, had to find my own way to do it. Ended up taking me eleven months altogether. I was going slower than most people. Most people do it in four to five months. Took me 11 months. I figured out my own way to do it. I figured out, hey, I don’t like getting to like the road crossing at dusk and the town is 11 miles away where I have to go resupply and get more food. And I’m like sticking my thumb out in my 50s when I hadn’t hitchhiked since I was 14. So I brought my car along and I would park my car. This is after I tried it and kind of crashed.

Peter: I would park my car like four or five days ahead of time with extra supplies and all that stuff in it. And I’d pay the shuttle drivers. It costs a hundred bucks or whatever for them to Uber me down to where I had left the trail before. Then I’d hike and when I, number one all I had to focus on was all I have to do is get back to my car. I don’t care how hard this is. In fact, if I started to think about I’ve got, you know, fifteen hundred miles to go or whatever, mentally I just couldn’t handle. It was like, I can’t do this.

Josh:Especially if you’ve never done it before? That’s no different than somebody saying like how do I accumulate two thousand units of apartments. When I have two rentals. I can’t even wrap my head around it. So what can I do? What’s a bite sized thing I can do? And for you, it’s like all of my supplies over my car. I’ve just got to get there.

Peter: And when it got really hard, you know, on a hot day and I’m just really struggling at times, it got down to where I would look up and I’m like, OK, I’m going to go up to that tree up there. That’s 100 yards. And that’s all I’m going to focus on right now, or I’m going to get to the top of the next mountain. And that’s all I think about. So, yeah, I get to my car, hop in the car, I go, stay in a nice Airbnb. Go get a steak dinner, go watch a movie. I would find a pool, I’d drive and find a pool to walk in with my injury. Walking in water for some reason makes it feel better for a few days.

Peter: And then go out. Do it over again. Rinse and repeat.And made, you know, made it all the way up to September 25th. I summited on top of Mount Katahdin in Maine. And my wife drove up there from Maryland to meet me at the bottom and celebrated with a bottle of champagne. So awesome experience just, you know, for the whole adventure. I mean, cause us go getters, right. We’re always focused on the future. We’re thinking about security and building stuff. Sometimes we really forget to do something like that where you just walk through the wilderness and just have time to just think. I’ve been so blessed in my life. I thought about all the funny little things my kids did over the years. I’d forgotten about. I thought about just kind of this big business. Well, one thing I left out was a year into my injury, my wife said, you need to focus on your injury.

Peter: You need to sell your business. I want you sell it to your partner. So that’s what I did. I had thirty-five employees, seventeen coaches, all of investments, sold off most of my investments. Turned that over to my partner. Let him run with it. Focused on my rehab. So now I’m walking through the woods thinking, gosh, you know, life’s been really good to me. What am I going to do after I’ve done this hike? I could yeah, I’ve been blessed well enough. You know, we’ve got this house pretty well paid for. I don’t have to do anything yet. But I started thinking back on back in the early years when I was mentoring people one on one.

Peter: I remember coaching a gal, her name was Emily. She’s on the phone. She’s crying, right. Because the seller is threatening to sell herbecause they found an all cash offer and they want to cancel her creative deal. I’m like, take a deep breath, Emily, it’s going to be all right. It’s just a real estate deal. I’ll help you with it. We got the seller to pay us some money to to basically, you know, undo her deal. She came out. We used to do this thing in Hawaii where people pay thirty thousand dollars to hang out for five days and really brainstorm how to, you know, take your investing business up to the next level. And she matched up with four other clients of mine.

Peter: They put together a group called the Grasslands Investing Group. And last I heard, they had 74 million in commercial assets that they’d acquired. I realized, Josh, that that. I feel so lucky to have started from where I was as an auto mechanic and to get over that, those obstacles, that fear of like when you first go into real estate is like, oh, my goodness, there’s so much stuff. It feels overwhelming to me. I was scared to death, I think, because I didn’t go. I had seven kids in our family. My parents said, we want you to go to college. We’re not going to help you. Good luck. Basically, I mean, in nicer words than that. I didn’t go to college. I didn’t have a lot of options in my life. Real estate was my one ticket out and I didn’t want to blow it. My first property, I bought a duplex. I was physically shaking at the closing because I had so much desire andso much fear and the two of them were like battling it.

Josh: Tearing you apart.

Peter: And so I realized that I feel really lucky to have made the transition that I did. And when I can help someone make that transition. But be there personally, myself doing it, noting them that that’s what I’m going to do for the rest of my life. So I coached people one on one for a couple of years. It was twenty-five thousand plus half the first two hundred thousand in profits at a blast. One of my students, Eric, helped him find this 19000 square foot building in Northern California. We got it for eight hundred and forty thousand. We did the inspection, got it down to eight hundred thousand. I showed him how to bring in a…. It was a little better than a hard money lender.

Peter: We got six percent interest, no payments for the first year. Funding to buy it and money to fix it up and it’s most of the way leased up right now. It’s slowed down a little bit with a pandemic. Most of the way leased up right now is numbers are showing it with a value of one point nine million. So guess that’s you know, you can. Now, that’s a grand slam deal. Those don’t have. Oh. Then his goal was to become the biggest, like, big shot, you know, commercial guy in town. And he had a background. He had managed his father’s car dealerships. So he had relationships. He had this that skill. It wasn’t like he was starting from absolute scratch, but he had no idea of commercial real estate.

Peter:So the next thing we did is I helped him to go buy the biggest real estate brokerage in town with no money. He took that over. He’s not even a broker. He took it over. He owns it now. He’s got 40 agents working for him, has set up his own commercial division. He’s got people all over coming at him, feeding him deals and stuff now. So I did that. I decided I’m going to do more of an affordable group program, you know, for people that want to do commercial options. And so that’s been keeping me busy. Yeah.

Josh: One of the characteristics of great entrepreneurs, real estate entrepreneurs, is that they are resourceful, they’re adaptable. They hit a challenge and it’s like, that’s not going to stop me. I’ve got to find another way to do it. They found another challenge at the second stop me. And if another way to do it versus other people who are ultimately not successful or just comfortable being in a certain job or be in a corporate world forever, because if there’s a problem in those environments, the company is kind of supposed to fix it for you versus being an entrepreneur. It’s I’ve got to find a way to fix it myself. So I’d love to hear your take on. First of all, you didn’t quit.

Josh: But along this trail, you probably had three or four or five things that kind of pop out things that are the real lessons for investing in real estate investment, commercial real estate, being on this path that you’re like, OK, if I was my younger former self. These are some things that I would pass along to my children, my grandchildren or my students or my younger former self. These are some of the things that I learned about myself and are on this trail that I would love to pass along to this audience with. Josh, what are some of those things, some bullets that you say like this is what I really learned about myself that I didn’t know when I was younger.

Peter: Well, there is some great stuff and a lot of lot of funny stories and stuff going on. I mean, there were bears and a moose that kind of came after me. And there was actually a night one night down in Georgia where 15 medics came to rescue me. That’s a whole nother story. I got it down in a book. I got it seventy five percent of the way done. It’s called Only When I Step On It. I’ve set that aside to focus on the commercial lease options stuff right now, but I hope to get that book out.

Peter: But to answer your question, what I’ve learned and how to compare that to real estate investing and this is kind of along the lines of if I was to like start over again in real estate investing what three things might I do differently?

Josh: Yeah, exactly. Exactly.

Peter: Number one, I would do commercial and not single family just because the reasons we’ve talked about. You know, not really any harder to get going. And you’re gonna end up making more money. You’re going to get to where you want to go anyways. You just gonna get there faster.

Peter: Number two, I would find a way to learn how to write deals where you have no liability, where you can tie up a property. There’s like three clauses that I recommend that people use that they add into an addendum. One is a, you know, a good inspection clause. One is an assignment clause. And the third one is a clause that says if the terms of this addendum conflict with the contract that this addendum is attached to, then the terms of this addendum prevail where you can take any state contract or like the standard commercial purchase contract I provide for my clients. You just attaches addendum to at least a staple.

Peter: Years ago, these days, it’s like in a PDF, you know, you’re attached on the PDF already to where the addendum controls the agreement. So you don’t have to worry so much about what’s in the purchase contract. So like for effective date, we say for effective date, we say see addendum A right. And then we list out all the things that need to happen before, you know, the effective date happens and how many days you’re going to get for your inspection. All that in the addendum which controls it. So big picture is learn one way or another, find a way to have someone show you or figure it out or whatever. Get comfortable with being able to have the paperwork and documents that you can make an offer on a property that ties it up where you have no obligation whatsoever to move ahead. That takes away the fear of is this the right building?

Peter: Do I know the numbers? Do I have to have everything right before I actually get out there and can guess what if it’s a great deal somewhere and you don’t tie it up right away, someone else is gonna get it.

Josh: Good deals go fast for sure.

Peter: The third thing is understanding that you don’t have to do these deals all on your own. You were talking about all the pieces of like the syndication and the money raisers and the tying in with Reg-D and all the stuff that goes along with that. You don’t you don’t have to know all that stuff. Start off doing maybe some wholesaling, some properties. Well, certainly some commercial properties. You’re gonna learn the first part of what you need to know anyways, which is finding deals and evaluating them and tying them up. Yeah.

Peter: And you’re gonna learn how to go through the process of figuring out is there really value in this deal? Did you get it right or did you not when you tried to wholesale it? Those three things I know that’s out of the 30 years of investing, there’s like so much stuff out there that, you know, I mean, I’ve had a ton of fun over the years doing lease options on houses and stuff like that. You just got to pick out of the big tremendous sea of opportunity, real estate investing and say, OK, what part of that am I going to carve out and call that my own and let someone else go out there. I mean, I’ve been interested in the years over, you know, tax lien investing and notes, buying just kind of notes and stuff like that.

Peter: Let someone else have fun with that part of real estate. I’m going to focus on a commercial real estate in particular, apartment buildings. Ones that we can either flip a contract on or bring an investor in, have the investor give you a chunk of money in exchange for some equity in the deal. Sure. Or, you know, find a way to work it like you’re doing on one of your deals. I know you told me you’ve got it structured where you’re using investors money to buy it, but the exit strategy is being able to refinance and pay those investors off. Right. Giving them the return that they expected to get out of it. But where you end up owning the property yourself long term. That’s right. That is a home run.

Josh: Absolutely. All the way. So, Peter, last question, more of on a personal level, I always like to ask my successful entrepreneur friends and mentors and people that I’m around that are entrepreneurs could be a real estate or any other niche. It takes a certain mindset, a certain amount of energy to be a successful entrepreneur. It’s definitely a journey. It’s more of a marathon than a sprint. There’s certainly parts of the process that are a sprint. But you have to have a certain, you know, way that you go about yourself, certain habits, certain things that you maybe eat, certain ways that you work out certain hacks in your personal life that allow you to be the best version of yourself. So I’m always curious to know what are some things that you do? Some hacks of your some personal things that you incorporate into your life that allow you to feel like you’re being the best version of yourself. What are some things that you incorporate that are maybe personal to you or unique to you that allow you to really live life at a high level?

Peter: Yeah, I think I think one is putting, you know, putting God and family first. When my kids call these days, I drop what I’m doing. I’m fully present with them. Even if it’s just on face time, I’m fully present with them. I try and do the same thing. I don’t always succeed at this, but she’ll tell you. But I try and be fully present. When my wife is telling me something, I try and listen to her and really listen and respond and tell me more about that, rather than, you know, we’ve done this before, you’re talking to your spouse and in your head, you’re thinking about that deal and how could this work? So I think that’s one thing.

Peter: The other thing, habits are just so powerful when you develop great habits. And part of this hike thing was, you know, when I crashed in Irwin, Tennessee and came home, I was like I got to figure this thing out. I lost like 10 pounds hiking, but I was like 30 pounds overweight. So part of what I realized was, if I lost 30 pounds. That’s 30 pounds less that I’m going to have to hike along caring. That’s like having my pack weight nothing. So I’m like, OK, I’m going to lose this weight. It was like October and I was going to go back out hiking again in February. I said, OK, I’ve got from October to February, I’m to lose 30 pounds. I’m going to lose one pound a week. It took a long time to put this in. I’m not going to expect to do it. That’s, I think, a big mistake that people make with their goals is they have a big goal. They don’t want to do it long over time to get the goal. They want to do it tomorrow or, you know, yesterday for free.

Josh: They want to make a million bucks this year.

Peter: Yeah. So I plotted that out on Excel, number one. Number two, I weighed myself every day. Number three, I tracked not my weight every day. It’s not what I looked at. I looked at my average for the week. So if I had one day where it was, you know, up three or four pounds, I wasn’t going to do this. Oh, my goodness. I’m never gonna lose weight. I might as well eat the ice cream, right? Yeah. It’s like, no, I got to stay with it. All I got to do is get my average weight down by another half-pound this week.

Peter: I developed good food to have. I start the day with a protein shake. It’s called Raw Fit Protein Powder. It’s actually made from peas. It’s like a nice-looking powder. It has some extra, I don’t know, coffee beans or something in it that supposedly helps you lose weight. I get that  on subscribe and safe from Amazon, where I get two of those every month. So I get a scoop of that half an avocado, a tablespoon of fiber, because that’s just a good way to sneak some fiber in the diet and get this a tablespoon of powdered peanut butter. I know there was such a thing, powdered peanut butter. It’s called like PNB, whatever. All of the flavor of peanut butter with, you know, none of the fat and hardly any of the calories, all of it in there. I put about two and a half cups of ice in it, of a crushed ice sit down on the blender. And I set it right there.

Peter: And when I turn that blender on every single morning, I do 100 squats while my blender is grinding up. Then I do like 50 leg squats, but that’s called habit linking. Where you link one habit to the other. So I don’t have to think about, oh, OK, I need to do my squats for today. If I’m gonna eat my breakfast, I’m going to do the squats. So my grandkids, they all think it’s funny. If you turn the blender on it at my grandkids’ house, they’ll all start doing squats no matter what.

Josh: Family Workout. Grandpa’s got the blender on.

Peter: Oh, this is great for listeners to hear. Part of an injury like this, you tend to have your good side get stronger and your injured side gets weaker. And by the way, as much as I thought it would fix my leg and be healed completely by the time I got to Mount Katahdin, I remember as coming down Katahdin and I met this guy and he got egos. Oh, that is so great is tell my story of hiking the trail. He’s like he just finished hiking the entire Appalachian Trail. He goes, congratulations. You did it with a bum leg. Cause I’m still limping down, you know? And I tell people I’m still walking to Katahdin and it’s something I work at every day. Part of that is getting out and learning to walk correctly, to walk upright.

Peter: I found that when it’s pushing the shopping cart in the grocery store, it was easier for me because I had something to hold on to so I could practice walking correctly up straight rather than when you do it weird like that. It it causes all sorts of muscles to work against each other and causes other problems.  And I knew I needed something to hold onto. All I could think of was like a walker and I did not want to go up and down the street pushing a walker. So what I got. Tell me if you like this idea. I got a baby carriage. I figured my grandkids, when they come I can put them in the baby carriage. And so I tried pushing it, but it was like, too light on the front. It was popping wheelies. So I look in my garage. I need some weight to put in here.

Peter: What do you think someone who’s published five books has in his garage lots of? So I took a box of books, put in the baby carriage. I pushed it up and down the street. My son was telling me, Dad, you should add like a wig and a purse or something and really give the neighbor something to talk about.

Josh: What do they call that? A house coat for those old Italian ladies?

Peter: There you go. Yeah, that with some flowers on it.

Josh: My wife is a hundred percent Italian, they all have their house coats. You could walk down the street with one of those.

Peter: I’ve been pushing that baby carriage up and down the street for a couple of years now. And the neighbors, they all come out like, what are you delivering packages? What do you have in the box there? It’s just crazy here, but it’s a willingness to look completely stupid in order to get what you want. And that’s a tremendous ability to forget it. Don’t work. That’s a lot of people they worry about. If I start investing in real estate, what if I fail? What are people going to say? If I go out, say, I’m gonna do this and then I fail, then? You know, they’re afraid. It’s like the real them, which is not true.

Peter: All of us here listening to this we’re all champions. We can all succeed at anything we want to go out in life. And that’s kind of my message, if I can make it hiking that 2190 Mile Appalachian Trail. From beginning to end, anything that you want to go after in life, you break it down step by step. You can most certainly do it.

Josh: Absolutely, no doubt. That’s an amazing message. Peter, appreciate you sharing that. Listen, as we kind of wrap up here. You’ve got your book, How to Profit from Commercial Lease Options. You’ve got your training, your coaching work. And people get in touch with you. Get copy of the book, connect with you for mentorship. Where’s a good place for people to reach out?

Peter: Well, I want to help out everyone on the call here and show you how to do commercial lease options. You can get a free copy of my book How to Profit with Commercial Lease Options. Just go to PetersFreeBook.Com. And as a listener to the podcast, we’ll make that available to you. Depending on what’s there. It might either be a free e-book or I think once we’re having them printed right now, you can get the actual book if you just pay the shipping on it. But just go to PetersFreeBook.com. And that’ll be a great overview. Show you how to do it yourself. And if you need any help, you know, our contact information is there as well. So PetersFreeBook.com.

Josh: Fantastic. Peter, listen, this has been an absolute blast. Total honor to have you on the podcast and reconnect with you. I’m so glad that you’re healthy. It’s been awesome. Just sharing with you again. I can’t wait for my listeners to hear this. Thanks so much for joining us on Accelerated Investor.

Peter: Thanks for having me on. And for all of you, listening. Thanks for spending some time with us today. It’s been great sharing with you. Have a great day. 

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.

One of my very first real estate mentors, Peter Conti, has done thousands of deals and mentored thousands of students. He is an absolute champion for real estate entrepreneurship, and he is so excited about the opportunities being presented by the current situation. In 30 years of investing, he says he’s never seen anything like it.

A few years ago, Peter had a terrible accident that looked like it was going to end his career forever. He was in chronic pain from a damaged leg that didn’t heal properly, and he wanted to quit on life entirely. His comeback story is powerful, and truly embodies the adaptability that every entrepreneur needs to succeed.

Now Peter mentors other investors, and his passion is commercial lease options. He walks me through his latest deal and the 3 key parts to a commercial lease option. These are simple parts, but because of the size of the deal, they can help accelerate an investor’s portfolio so much faster.

For my podcast listeners, Peter is offering a free copy of his newest book How to Profit with Commercial Lease Options at PetersFreeBook.com, or you can follow the link in the show notes.

If you loved today’s episode, like us and leave us a review on iTunes. For a chance to win some Accelerated Investor gear, take a screenshot of your review and send it to us via social media. Come back every week to hear us announce the winner on our podcast.

What’s Inside:

  • How commercial lease options can transform your portfolio.
  • The three clauses Peter recommends for every addendum.
  • Peter walks us through his newest multi-family and how he’s adding value to the property.
  • Peter’s walk along the Appalachian Trail after a terrible accident.

Mentioned in this episode​

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