Josh Cantwell: So, hey, guys, welcome back. Hey, it’s Josh Cantwell, your host at Accelerated Investor. And today, I have a super, super episode for you. My guest today is Sandhya Seshadri. She is the Founder and President/CEO of Engineered Capital. She has a very, very prolific resume as an experienced multifamily syndicator. She has spoken on stages with Shaquille O’Neal, Barbara Corcoran, and Jocko. She’s spoken at almost every major conference on multifamily investing. She has 25 years of experience and has over a 5,000-unit total digital footprint of high-net-worth investors, business owners, and executives. And she’s done over 3,000 doors as a GP and LP.

You’re going to love this episode because here’s what we’re going to talk about. Number one, we’re going to talk about the five must-haves in every apartment underwriting and acquisition, the five things you must have in that underwrite for an acquisition. Number two, we’re going to talk about the seven major mistakes that you’re seeing that are being made by operators that are turning into, number three, the horror stories. So, we’re going to talk about one major horror story that’s going on in the marketplace in very real time right now. It’s unwinding in front of your eyes where an operator is losing thousands of units. We’re going to talk about that horror story. Number four, we’re going to talk about the three boxes that you have as a multifamily syndicator. And finally, number five, we’re going to talk about the four-asset management must-haves so that when you own the property, the things that you must do to make sure that your business plan comes to life.

My guest is phenomenal. She’s got tons of energy, tremendous amount of experience. This is an amazing episode of Accelerated Investor. You’re going to love it. Here we go.

[INTERVIEW]

Josh Cantwell: So, Sandhya, hey, thank you so much for jumping on. I’m so excited to have you on the show. I’ve been following a lot of what you’ve been posting on Facebook and LinkedIn and all over social media about some of the current events, some of the deals that are happening, and also some of the deals that are starting to kind of go south and implode. So, thanks for taking out a few minutes to jump on the show for us.

Sandhya Seshadri: Very excited to be here, Josh. Thank you so much for the invite.

Josh Cantwell: Yeah, you bet. Anytime I can talk shop with another experienced multifamily investor and syndicator is really fun for me, obviously, between your experience and ours, as public of 10,000-plus units. So, it’s fun to have someone on the show to ham and egg it with. But let’s talk for a second about what you’re up to. We’re going to talk about the current state of the market and some of the cracks that we’re starting to see in some investments. But as we introduce you here to our audience, what are some passion projects that you’re working on? What are some things that you’re excited about in today’s market for your business?

Sandhya Seshadri: I think there’s plenty of opportunity in any market. And I actually think that in times of recession, inflation, etc., is when even more millionaires are made. So, you just have to keep strict criteria and whatever opportunity you’re looking for, whether that’s in the stock market or in real estate. There’s deals to be made in both.

Josh Cantwell: No doubt. Yeah, I see deals trading, obviously, see deals that even sellers are positioning to get 90% occupied for 90 days and stabilized income so that buyers can qualify for permanent debt, bank debt. A lot of people don’t want to go recourse bridge that’s hard to get right now because interest rates are so high. So, the play primarily, if you’re selling or buying, is to use permanent debt, long-term financing, low loan-to-value. So really important to do that. So, deals that you’re seeing now or deals that you’re betting, is that the type of thing that you’re looking for, things that you think will pencil in today’s market?

Sandhya Seshadri: Yes, even the last two deals that I did in 2022 were both permanent debt, Freddie Mac, fixed-rate, 10-year loans, five years of IO, and 60%, 65% kind of leverage so that when you do your break-even analysis, you can take your occupancy down, your economic occupancy down to a pretty low level at 70%, and still the deal flows. You’re not at any risk of default or getting into forbearance, etc. So, deal has to finance correctly with the right debt structure. And that’s very important because, as you know, a lot of the deals that haven’t gone so well this year have been because of those highly leveraged floating-rate loan deals in the past.

Josh Cantwell: No doubt. And so, we’re going to jump into that. You’ve been an experienced multifamily syndicator for some time and the market’s really fun. And if you’re like most people who are really geek out on this stuff, like the work doesn’t feel like work, but how about outside of work? How about your passion projects? As we introduce you again to our audience, what’s important to you in your entrepreneurial journey? Why are you investing the way you are? What do you think are some of the outcomes that you want to get from your investing that fulfill you on a personal level?

Sandhya Seshadri: The biggest fulfillment for me is to see happy communities because when I came here as an immigrant, I lived in an apartment complex, just like the ones that I run and manage now. And to see those communities come together and do these periodic events makes me really happy because I want to have a cul-de-sac-like feel to these places. Because I went to this college called SMU in Highland Park in Dallas, a very fancy neighborhood that I still can’t afford. And I used to see these neighborhoods and cul-de-sacs feel in how everyone comes together. And I want to see that from a fulfillment standpoint.

Another passion project I have is math and financial literacy. So, I too have been tutoring kids for over a decade now at no charge just to bring that confidence in math. It’s not because you need to know how to do calculus, but you need to know your financials and you need to make sure that you keep the money that you make. And that’s so important because otherwise, even if you make millions, you will go bankrupt if you don’t have the basic financial literacy and that intuitive sense for when you look at an investment.

Josh Cantwell: Yeah, I love the fact that you say that because when I do our investments, we’ve done 19 syndications, 4,500 units, and then I have a mastermind and I teach this to that group, I tell them all the time, I love this business because it’s just sixth-grade math. It’s addition and subtraction, it’s multiplication, division, it’s cap rates, it’s debt-service coverage ratios. It’s all sixth-grade math. It’s things that we learn in sixth grade. It’s not calculus, right?

Sandhya Seshadri: Exactly.

Josh Cantwell: I love math, too, like you, and I love financial literacy and education like you. But anybody can do sixth-grade math, almost anybody. And if you could do sixth-grade math, you can pencil out a multifamily deal. And then the art and the science kind of meet in the business plan. How are you going to operate the building and what’s your business plan versus somebody else’s? So, I love the fact that you’re passionate for that. I am too, because really anybody can do this if they have that basic math education.

So, as we talk a little bit about some of the things that are happening in today’s market, some people got the math wrong. Or they pencil that way too conservatively. So, let’s talk about some of the things that you think when you underwrite a deal the right way, the conservative way, what are some things that are important to you when it comes to, is it having local boots on the ground? Is it long-term debt? Is it low loan-to-value? Look, what do you think are some of the characteristics of a really solid underwrite and a really solid acquisition? And then we’re going to talk about how some of these operators have gotten it wrong. But in your mind, what are the things that have to check, the boxes that you have to check for you to acquire your next syndication?

Sandhya Seshadri: Every number that’s ever input into an analyzer spreadsheet must come from an unbiased source. What do I mean by that? My lending terms. It has to be an official term sheet from a lender, like a DUS lender, ideally, if you’re going with an agency loan. So, your Fannie or Freddie term sheet, that’s hopefully not going to change in the next 60 days, right? And see if you can lock in that rate ahead of time, which Freddie allows you to do with an additional deposit. That’s a great one to start with because when you go and present your investment opportunity in a webinar to investors, you can tell them, “I have this rate locked in, guys. Doesn’t matter what the Fed does, I’m locked in.” So, that gives me a lot of confidence. So, I love that.

Another thing when I see unbiased sources is I do my deals in the Dallas area in Texas, so I want to make sure a tax purchase company tells me specifically what my taxes look like, not just now, but in the next three years based on the county because even those counties, it makes a big difference. So, you want a local expert. Insurance, your quotes can change year to year based on your carrier, your location of your property, whether it’s in a floodplain, and what the last claims have been recently. So, again, you want somebody to give you an insurance quote for that specific property, even if you know the area well, makes a big difference.

We thought one property of ours was going to have only two or three buildings in the floodplain. They came back with a dozen buildings in the floodplain. We had to go back, talk to somebody who negotiates with FEMA and reduces that number to even afford that insurance. So, you got to dig a little bit deep into your numbers. Your expenses and operating income, etc., it has to be coming from a third-party source who’s neutral and not biased like you, the operator, wanting to make the numbers work. So, we employ third-party property management companies. So, they tell us, is this rent bond reasonable? Can you really get $200 more because you put a stainless-steel appliance package in your kitchen on a one-bedroom? So, just things like that.

What is your median household income in that area? And you need a minimum factor of 3x, but I’m almost going to a 3.5x to 4x. What do I mean by that? The entire expense for that household to afford your rent, including utilities, all the extras, parking, blah, blah, blah, let’s see all of that adds up to $1,500 times 12, you’re at $18,000. So, I want that median household income to be more than that 54k. I want it to be maybe 60k-plus. So, if my median household income there is only 40k, that’s too low. So, that’s an easy screening criteria. Before you even start underwriting the deal, you would look at that just the rent rule and say, can this group here with this median income even afford this place?

Crime is huge for me. I do not go to high-crime areas. There’s a lot of people who can successfully operate deals in high-crime areas. I park at these properties and walk around at night and say, “Can I feel safe walking around here?” I want that single mom with two kids to come and live at my property. So, if I don’t feel safe walking there at night, maybe the property itself has patrol and gates and all of that. But what is the vicinity looking like, the next one, two, or three miles? If I don’t like that area, I don’t go there. If I’m going to buy a house there or not, that’s one of my questions. Would I want to live there? If I was renting an apartment, would I let my kid live there? So, crime is huge for me.

Poverty level is something else that I check. Schools, sometimes school system is important, but if you have a lot of bilingual population, a lot of other languages are spoken there and their English score tends to be low C, you may not get as high as a school rating. So, that’s one of those things that is more subjective. I drive and I check that.

But first thing again is your neutral inputs into your analyzer spreadsheet. So, property management gives you your income, your expenses, and agrees with you that, hey, you can charge 50 bucks for parking, and sure, this tenant pool is going to pay for it because what if there’s inadequate parking? What if that’s not a thing done in your nearby vicinity? What if you want to shove a cable Internet package down there? What do you think smart lockers or other amenities? Is that something that’s really the norm in that locality, in that neighborhood for that particular deal? So, that’s your comparative shopping. You’ve got to do that. And it’s got to make sense for that class of property. Are you really doing a fair comparison of your property? If your property is a C class or a B-minus and you’re comparing it to the brand-new build A class just a few years ago and saying, “Oh, they’re getting $400 more for these two bedrooms,” that’s not a fair comparison. So, same class of property in the same neighborhood, ideally within a one-mile radius. So, really drill deep into that comparative analysis.

And my advantage is that I’ve lived in Dallas-Fort Worth for 33 years. So, once you give me a zip code in an address, I can almost tell you based on price per door and class of property if I’m even interested. So, I don’t need to spend hours digging into this level of detail just because of that. So, if you partner with somebody who is a local expert, that gives you that competitive advantage.

Josh Cantwell: Yeah, I love it. So, all of that that you just covered, Sandhya, that was really tight. Like, you obviously know what you’re talking about. And all of that kind of falls into this category of what you mentioned as neutral inputs. You mentioned locking in the rate, so long-term debt, low loan-to-value, those are some of the things we talked about right away.

But then you mentioned all these unbiased sources or neutral inputs, taxes, insurance, expenses, median household income, crime, schools. You also mentioned boots on the ground because you’re local, you wouldn’t bust in your backyard, which happens to be Dallas-Fort Worth. I love that.

I’m from the Greater Cleveland area. I don’t love Cleveland, Ohio as far as a growth market, but I love it because I live here, similar to you. So, we’ve got a big portfolio here. We’ve got a big portfolio in Houston, a big portfolio in Atlanta. But since COVID hit, we’re really focused on Ohio because we learned from COVID. Being local is critical or having really good boots on the ground is critical. So, out of the things you all mentioned, just for our audience to write these things down is the lock in that long-term rate, lock in low loan-to-value, use unbiased sources or neutral inputs, double check the taxes with the third party, get those insurance quotes, and then obviously boots on the ground, local management, local buying. You can visit the properties, you can secret shop them any time you want.

And you could even, like you said, show up at night when it’s dark. Are you comfortable? Are you okay walking around? Like, that is critical. It’s tough to find a property manager that’s going to do that. You’ve got to do it. Much like Sandhya said, third-party management. I love that because you can only be so good at so many things, right? Underwriting deals, finding deals, acquisitions, that’s one of our sweet spots. And then for us, construction is a sweet spot. Third-party management, we outsource that as well, just like she mentioned. So, I love that, love that, love that. So, it’s great to hear you mention all those.

Now, you’ve been super active on Facebook lately, almost on a weekly basis, if not more often, posting about some of the deals that are starting to go crooked, sideways, upside down. Tell me about that from a high level, what are some of the things, and tell our audience, what are some of the things that you’re starting to notice?

Sandhya Seshadri: So, the biggest thing that happened was back in 2021, bridge or floating rate loans even from Freddie, were becoming very attractive because they gave you loans at a higher leverage. You could get 75%, 80% of your purchase price in the form of a loan, which meant also that you get a better return for your investors because your cost of capital is less. You have to raise less money to buy this deal because the lender is willing to give you more for this deal, 75% to 80% of your purchase price. In addition, you get more interest only when it’s a bridge loan and there is no exit penalty when it’s a bridge loan. So, if you want to refi or sell your deal in two to three years, you have no exit penalty like a yield maintenance penalty.

The other thing was there were some deals that might not have penciled out perfectly in terms of 90% occupancy, which is what your agencies like to see as a stabilized loan. So, due to all these reasons, bridge loans were the flavor in 2021. And a lot of people acquired several deals in a row. This particular syndicator acquired many deals in a row to grow big, grow really fast, 800,000 doors plus kind of deals in the range of $60 to $100 million range, several deals back to back.

Now, I know as a syndicator how hectic it is those 60 days from when you’re under contract to try and close the deal. And to do that back to back several deals in a row, that means your entire focus is just on raising enough money and getting those deals to close. He did that with 80% leverage loans, and to raise such large sums of money, he also had this pref equity company writing checks to cover an additional 10%. So, only about 10% was raised from investors.

What happened in all of these deals is that he did not pay attention to the operations or asset management to execute the business plan. And all of these were heavy value-add deals in somewhat rough areas. So, if you don’t pay attention to operations, then a lot of things suffer. You can’t return money to investors. Your investors won’t come back. So, every deal had one thing in common. He had the same property management company across the board on all these deals in Houston. And that company went out of business about halfway through 2022.

He also left it completely up to property management without focusing on asset management, like day one takeover of a high heavy lift, heavy value-add kind of deal, there’s a lot of work to be done. So, he did not pay attention to that or hiring of staff to be scaled and have systems and processes in place to handle that volume. Do you grow too fast and you don’t have that, then it’s like growing pains?

Well, the Fed started raising interest rates and they did it 10 times in a row since last year, so that was a big ouch. And all these deals were floating rate deals without a rate cap. That’s a problem. So, what is a rate cap? It kind of puts a ceiling on how much interest you will have to pay on that mortgage. So, the rates might have started out at less than 4%, 3.75% as an example. But you have to buy a rate cap and cap it at, let’s say, 6%, 5.5% as an example, which I also have floating rate deals. Those were inexpensive to buy back in 2021.

Josh Cantwell: Oh, yeah.

Sandhya Seshadri: I bought a rate cap for $40,000 as an example in July 2021. Today, it’s worth $300,000 plus. It’s insane. It’s like, how did this happen? But he did not buy it, even though it was inexpensive to buy it at that time. So, as the interest rates went up, the mortgage was super high and his NOI or net operating income was insufficient to cover the mortgage.

So, this is where we talk about DSCR, debt-service coverage ratio. It’s like all the paychecks coming home need to be enough to pay your monthly home mortgage, right? It’s the same concept. You don’t have enough of a net operating income at this property to pay off the mortgage. So, by the time you do all your rent collections and pay for the operating expenses of running this property, what’s leftover NOI was not enough to pay the mortgage.

On top of that because of neglecting these properties, every one of these properties had numerous code violations, citations, issues. Occupancy has dropped at one of these properties, I think, from 94% to 54%. Cabo San Lucas Apartments, I think, had a huge drop in occupancy. Yeah, just the name of the Cabo Airport, you know that’s the name of these apartments. So, that’s an example of you’ve neglected the operations side so you can’t even keep your property occupied. You also went in with this assumption that everything’s going to work out perfectly, and cap rates are going to continue to decline like they have in the past. So, you could close your eyes and do nothing and you’d still make money on these properties.

And unfortunately, the Fed had other plans to curb inflation. So, didn’t have a rate cap, couldn’t cover the mortgage, neglected your property, occupancy falls, numerous code violations. You’re on TV for the wrong reasons by city councils, city inspectors. There’s trash everywhere. There’s high crime. There’s shootings. Units are boarded up. There’s electrical wiring issues, just about everything you can imagine going wrong with a property went wrong from a complete lack of asset in property management in the back end. But the primary reason, again, is highly leveraged loans without rate caps and with everything working out perfectly kind of scenario, which in reality, on a high value-add deal.

Josh Cantwell: So, if our audience now is like, okay, we talked about all the things at the beginning that you need to do to underwrite it the right way, like all the neutral inputs, long-term debt, low loan-to-value, that everything you just described is the exact opposite, where they did everything differently than you and I would have done it. So, I wonder, okay, so let’s peel back the onion a little bit and talk about that leadership group that totally botched these deals and screwed this up. Why do you think they got so far away from what we would consider conservative, proper underwriting? Were they on a high that they were just like closing, closing, closing? They just want to buy all these properties. The market’s going to keep going up.

This is in 2021. Floating-rate loans are popular. Nobody’s anticipating seeing all these inflation numbers come out. Nobody’s anticipating the Fed raising rates 10 times in a row. So, what do you think, in your opinion, this is going to get more into the opinion side of things, yours and mine, because we don’t know exactly what they were thinking, but in your opinion, what was motivating them? Why would they do all that? Did they think the market was just going to keep growing and growing? Were they doing something fraudulent? Or are they taking acquisition fees off the top? What do you think was going through their mind that they would get so far away from the fundamentals?

Sandhya Seshadri: So, it’s actually one main top lead syndicator who made all these decisions. I think he was trying to grow big very fast. And he assumed that the times would continue like they were in the past because he’s had many successful deals complete a full cycle. And then he also had solid partners in many of his deals. But in most of these deals that foreclosed, he was the solo partner because he went with a private equity, pref equity company. So, he didn’t really need as many partners.

And he thought that his strong property management company, with whom he gave all these thousands of doors, would do their job. But unfortunately, they went out of business. They were not paying any attention to the property, and that’s one of the reasons it failed. But I remember talking to him. I know him. And actually, the last deal I purchased in 2022 was actually sold by him and his partners. We’re part of the same larger group. I know that he was very ambitious, but I think he forgot some of the fundamentals, which is the leverage side of it. And there was a lot more emphasis. If you go across the board, you talk to any groups everywhere, there’s so much emphasis on the excitement of acquisition. It’s just like in real life, we take a year to plan a wedding. We talk about the honeymoon, but very little is talked about the reality of marriage afterwards.

Josh Cantwell: Sure. It’s a great analogy.

Sandhya Seshadri: The excitement of finding a deal, let’s go acquire a deal. Let’s have this many doors, thousands of doors, these many dollars. Let me go to a billion dollars was kind of his goal. And to do that, if somebody was writing the big checks, the biggest barrier at that time to acquiring deals is raising capital from individual investors. And if you can overcome that by getting a big fat check, $10 million, $20 million from a company, equity company that believed in you, then half the battle is over. An acquisition, if you can imagine how much it is on even a $50 million deal, even a 1% deal, and imagine if you do that many deals back to back, I don’t know, it was like very exciting to be in that fast lane.

But you didn’t have the support system in the back. It’s like, it’s nice to be on stage, but you need all that camera crew. It’s like all the credits that happen at the end of the movie because all you remember is Tom Cruise from Maverick, but what about all those people that did it happen, right? Credits, he didn’t have the credits. He just thought he could stand on stage and have a movie. And unfortunately, that’s not the reality of life. You need all the people, the support system in the back so you can do what you’re doing.

Josh Cantwell: So, it becomes a horror movie. And so, what’s the outcome going forward? I mean, it is obviously foreclosure. He has reputations ruined. He’ll probably never be able to raise a nickel of money again.

Sandhya Seshadri: It’s a little worse.

Josh Cantwell: I don’t know if he’s going to end up in lawsuits, probably. I don’t know if there’s going to be any federal securities, investigations, most likely, especially considering the size of money. It’s like a worst-case scenario.

Sandhya Seshadri: So, if you read my post from today, which is June 7th, on Facebook, it’s actually something slightly worse. So, not only does he have four deals that are already foreclosed, he has a fifth deal that’s going to foreclose. But the other problem was that he raised over $12 million from investors to acquire a deal. Unfortunately, he did not use that money and purchased that deal. That deal never closed. He never acquired it. But the money is missing. So, it’s possible that that money might have been used for other deals to save other deals, etc. We don’t know exactly where it went, but $12 million of investor money that was wired towards the acquisition of a specific portfolio for which they signed the PPM docs, etc., has not been acquired. And there is at least a few lawsuits that I’m aware of that are pending. Yep.

Josh Cantwell: I’m looking at your post from today. This is phenomenal. By the way, our audience, if you’re not following Sandhya on Facebook, she’s prolific on Facebook with her posts about her personal life but also about deals and about– she speaks at lots of events, but lately been posting a lot about these deals that are imploding. And I think the takeaway from this is, regardless of the excitement, like when we buy a multifamily deal, what I used to say to partners. I have this quote that I’ve been using forever is, “Look, you’re married. I’m married. We don’t have to get married.”

The problem with multifamily is we’re going to get married. We have these partnerships that come together. We are getting married. It might be for three to five years or whatever the life cycle of that deal is, 7 to 10 years. Who knows? Each deal is a little different, but we’re going to get married. And so, it’s like you have to look at this deal and your partners and the property manager and your limited partners, general partners in a similar way that you would be talking with and courting and vetting out a lifelong partner in a marriage because when something does go wrong, you have to be willing to work through it together. No deal goes exactly like the underwrite. Sometimes they’re a lot better, sometimes not quite as good. You have to be able to talk to investors and work through that.

But at the end of the day, having multiple people look at that underwrite, multiple people look at and poke holes through it makes a lot of sense. And look, the honeymoon phase of finding your spouse, finding a partner, all the excitement of that honeymoon phase of the first six months to two years of the dating and the honeymoon and the marriage eventually, like Sandhya mentioned, now you get into the day-to-day life. And is this a partner that I want to be with? Now, is this a deal that I want to own for a long time? Are these partners that I want to spend time with and go to war with?

I mean, you owned properties in the middle of COVID, so did I. I was on a podcast the other day and we talked about being a wartime CEO. That was like being a wartime president. Like you didn’t know if it was friendly fire, if it was fire coming from the enemy, you had no idea. And so, buying the deal right, it means everything at the beginning because even if you buy it right, there’s still going to be challenges, let alone buying it completely wrong with all these mistakes that this fellow made, it just makes your job so much more difficult.

And I think at the end of the day, my takeaway is buying properties for the long term, buying them, assuming it’s a long-term marriage, buying them, assuming that there’s going to be issues and problems. And is this a deal and are these partners that I want to be in battle with long term, right? Versus just the excitement of, hey, a bachelor party in Vegas, whoa, it’s great. That was kind of like this guy the way he looked at these acquisitions was just the excitement of it versus the long-term approach. That’s kind of like my takeaway and what I would look at it.

But today, as we kind of round third here and head for home, a couple of things that you mentioned, the floating rate debt, right? No rate cap, heavy value-add, rough areas, the same property manager. Another way to avoid these kind of problems is diversifying your portfolio with different property managers. So, let me ask you, what would you have done different to kind of come full circle back to our original conversation? If you had acquired these properties, and this is kind of getting into the advice to our audience, again, what are some of the things that you would have looked at, done differently that would maybe have made these deals go much, much better and for the longer term?

Sandhya Seshadri: I would hire property management companies that already have a good reputation with syndicators I know in that local area. So, in Dallas, I have three different property management companies. And I chose three different companies because one of them, for example, manages the property next door. That way, if my maintenance guy’s out, and at one point, it was very hard to find good maintenance guys, I can borrow a few hours for all the emergencies. So, that’s a big one. As far as not putting all your eggs into one basket, I would definitely have local boots on the ground asset management and I would visit the properties daily.

In fact, on the day or the first week of takeover of any property, one of the things I do is I take my laptop and I home office out of there so that if they have questions before all their systems are set up and they need quick approvals for a few hundred dollars and they’re saying, yes, do it, do it, because those first few days is crucial to be there at takeover and set the tone. I even try to bring them a meal, etc., to make them feel comfortable because it’s a lot of work, and a lot of times, you take over on the first of the month, which is also your rent collection time and not everything is set up in place. So, having a local asset manager who is willing to actually spend time is crucial.

Of course, I like to visit my properties on a regular basis and I try not to visit them on their busiest days, but at least minimum, twice a month I’m there. But I also have partners who can circle with me and then they’ll visit too. So, we check on vendors, etc. It’s not a matter of disturbing the property manager on-site but checking on your CapEx. When you have a heavy value-add, what are the Google reviews, Yelp reviews saying about the property as the biggest issues tenants are complaining about? You want to have that on your list.

You have three bosses. One of them is your lender. So, what are the lender-required repairs? Do you want to have a plan to address that? You also have your city inspector to get your certificate of occupancy. What is their punch list looking like? And then you have your residents and work orders along with any additional requirements from insurance that you’ve got to do. So, that’s always your first punch list.

And then from there, but those would be the things I would address because you can have 100 and something code violations in a property and utilities not even being switched out six months into operations and have a failing declining property management company with nobody on site. That’s why we secret shop, whether it’s my friend calling the property or driving by the property or pretending like they want an apartment for their daughter. You’ve got to do those things periodically. So, the checks and balances, trust but verify, as we said.

Josh Cantwell: Oh, my gosh. I love it. Sandhya, I would ask you if you had any other advice, but this whole episode was advice. Oh, so this is just absolutely fantastic. Listen, I know you’re going to be speaking at a number of events. I know you have some checklists and some giveaways. Tell us about all the different places and ways that our audience can engage with you on your websites and some of your free materials that give away, some of your upcoming speaking engagements. Tell us about those.

Sandhya Seshadri: So, I’m going to be at Multifamily Investor Nation Conference in Charlotte. I will be at a NatCon, which is in Dallas. I will be at the Old Capital Conference, which is also in Dallas. I try to attend as many conferences as possible that are held in Dallas. I have a giveaway which is a vet a sponsorship team checklist because as much as the property is important, it’s the jockey as much as the horse that you’re betting on as we know from these foreclosures. So, you can go to my website and download that checklist.

I also have a monthly webinar I do, which is to educate passive investors. You can go to ACEPassive.com and sign up to come to any of those webinars. It does not put you in my mailing list to get deals, etc. That is a separate process. This is only for information and educational purposes.

Josh Cantwell: I love it. So, main website is Engineered-Capital.com. Make sure you friend and follow Sandhya on Facebook because she’s prolific and very busy there. That’s where I kind of follow her and follow along with some of her material. And so, listen, this has been a fantastic interview. Thank you so much for all this advice and thank you for carving out a few minutes for us on Accelerated Investor.

Sandhya Seshadri: Thank you so much, Josh. It’s been a pleasure. It’s wonderful to talk to people who actually speak the same language, if you will. Thank you.

Josh Cantwell: Yeah, you bet. Thanks so much for jumping on.

[CLOSING]

Josh Cantwell: Well, there you have it, guys. Listen, I hope you enjoyed that episode with Sandhya. Man, I really, really love talking to people like her who are unbelievably experienced. You can tell that she’s got some serious asset management chops, some serious investor capital chops, and really knows what she’s doing. She’s got a ton of free information on her website, Engineered-Capital.com. Make sure you engage with her on Facebook and social media.

And also, guys, listen, if you like this episode and all of our episodes, don’t forget to like, subscribe, share, and just rate and review. I mean we love it when we get people that give us feedback. Got hundreds and hundreds of ratings and reviews, and we really love it. Thank you for doing that for us.

And finally, guys, don’t forget about our live events and opportunities to engage with us and learn about our multifamily syndication opportunities, and also, about how you can be an operator. Go to ForeverPassiveIncome.com to get a ticket to one of our upcoming live events, or go to JoshCantwellCoaching.com to check out our Mastermind program. Thank you so much for being here, guys. I love having episodes like this to share with you and the content and amazing guests like Sandhya. Appreciate you being here. Talk to you next time. Take care.