Todd Dexheimer on the Massive Opportunities in Residential Assisted Living Real Estate – EP 320

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The reality is baby boomers are getting older, which means that demand for residential assisted living is highly likely to explode in the years to come. So what can you do to make this asset class part of your portfolio?

To answer that question, I’m talking to Todd Dexheimer. Todd is the principal of Endurus Capital and VitaCare Living and the host of the Pillars of Wealth Creation Podcast. He’s been in the real estate game since 2008 and now owns 4,000 units of multifamily and senior housing. He’s also done over 150 flips, including a mobile home park and a ski resort. These days he’s focused on syndications in value-add multifamily and senior living in emerging markets.

In this episode, we dig into why residential assisted living is a massive opportunity for real estate investors, why senior housing is an excellent addition to your portfolio, and how to structure these deals to ensure success. If you’re looking to explore this revenue stream, it’s not just a great conversation–it’s a must-listen.

Key Takeaways with Todd Dexheimer

  • How the fear of a recession seems to happen every year, and how that hasn’t stopped investors from buying real estate, and shouldn’t stop you either.
  • How to pivot into residential assisted living (RAL)–and what Todd did to add 400 units of RAL to his portfolio.
  • How supply and demand will make adding residential assisted living assets to your portfolio a worthwhile and profitable investment.
  • The exercise that Todd uses to stay focused on the activities that actually move your business forward.
  • Todd’s advice on how to structure your residential assisted living deals to optimize your profit
  • Why using third-party property managers is still a lot of work, but makes the most sense for managing a RAL.

Todd Dexheimer Tweetables

“I didn’t allow myself to think beyond the box that I was in at all times, but I eventually got out of that little box that I put myself in and allowed my paradigm to continue to shift.”

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Josh Cantwell: So, hey guys, welcome back to Accelerated Investor. I’m your host Josh Cantwell, and today, I’m excited because I’m talking with Todd Dexheimer. He is the principal of Endurus Capital and VitaCare Living, started investing in real estate all the way back in 2008. And today, he and his companies own 4,000 units of multifamily as well as senior housing. He’s completed over 150 flips, including a 20-unit mobile home park and a ski resort. And today, he’s focused on his syndication business with value-add multifamily and senior living in emerging markets. He’s also the host of the Pillars of Wealth Creation podcast and really, really excited to have him on the show.

 

And here’s what you got to learn today, number one, you’re going to learn why there’s a fear of recession every year. And Todd’s been talking to us about how, all the way back to 2016, there was a fear of recession every single year he’s been in business. Number two, he’s going to tell you how he pivoted into residential assisted living and added over 400 units of RAL to his portfolio. And number three, you’re going to hear about a specific exercise that Todd does about once a quarter, where he evaluates his time and actually labels the activities that he’s doing in a 1 through 10 format so that he can then outsource all of the 1 through 8s and focus on the 9s and 10s that truly move his business forward.

 

We’re also going to talk about, number four, Todd’s favorite structure for residential assisted living and why there’s a massive opportunity coming as all of our baby boomers are growing and getting older. So, we’re going to talk multifamily, we’re going to talk syndication, we’re going to talk optimization, we’re going to talk residential assisted living in this episode of Accelerated Investor with Todd Dexheimer. Here we go.

 

[INTERVIEW]

 

Josh Cantwell: So, hey, Todd, listen, thanks so much for joining me today on Accelerated Investor. I’m so excited to have you on the show to talk about multifamily and also how to tack on senior housing into your portfolio. So, thanks for carving out a few minutes for us.

 

Todd Dexheimer: Yeah, Josh, I appreciate you having me on. I’m excited to get to it, man.

 

Josh Cantwell: Absolutely. So, Todd, let’s talk about current events. Let’s talk about what’s going on in today’s market. And why don’t you just tell our audience a little bit about what you’re kind of passionate for today, what kind of projects, what things are you working on right now that you’re most geeked up about and passionate for? And why are you excited about that?

 

Todd Dexheimer: Yeah. So, man, right now, super excited what’s going on in our business. And so, we’re doing a lot of just growth within the business, and really, what I mean by that is really systematizing things. We’re putting a lot of processes into place. We recently hired several people in our business acquisitions and kind of broker relations guy. We hired a project manager, construction project manager, investor relations, bookkeeper, our new bookkeeper. And so, we’ve just been doing a lot of great hires and really trying to grow the business processes, systems, and organization. And so, that’s been great.

 

And on the actual business front, we’ve been buying this amount of properties this year. I think we’re hoping to close on about $100 million this year. I think we’re about 80 right now that we will close on two projects here in September, so we’re not quite ready, but by the end of September, we’ll be at about $80 million. So, just a fun year, a lot of good value-add projects. And like I said, just really excited about the growth in the business and how we’re putting that together.

 

Josh Cantwell: Love it. So, with that being said, adding $100 million, some people would be like, oh, wow, man, Josh, you and your guests, nobody’s taking their foot off the gas. Everybody keeps buying. Everybody keeps growing their business. It’s not like anybody’s really been afraid of the higher cost of capital or inflation. So, tell me, Todd, about that. How have the changes in the market impacted your business? How have you adjusted? And has that changed your buying strategy or development strategy at all?

 

Todd Dexheimer: Yes, I mean, there’s definitely adjustments that have been made and things that we’re really thinking about and being aware of. Obviously, we’re in this kind of weird environment, but here’s the thing, Josh, look back. Tell me a year where it didn’t feel like we were potentially going to hit a recession or that there was something weird happening, COVID, like 2018, people were talking about the recession, 2019, they were talking about a recession, 2020 COVID, 2021 COVID, 2022 recession, 2017 recession. You name it, it’s always on people’s minds. Will it happen? Absolutely. A recession will happen.

 

So, look, if we were always fearful of recession, we just would never be buying. So, what we have to look at is what the facts are today and what the trends are in the future and try to make our best estimate of how to protect our investments, how to protect our investors, and how to still grow our business at the same time. And that’s kind of how we look at what we’re doing and look at deals. And definitely, interest rates have changed the game a bit. They’re much, much higher.

 

And raising capital today is definitely more difficult. I would say it’s gotten a little bit easier here over the last couple of months, but then back in May, I remember talking to a guy who’s raised billions of dollars. That’s billions, plural. And he said that May was his most difficult month he’s ever had raising money.

 

And I would have said the same thing. We had a challenging raise in May. It was only a $5 million raise. And we actually had to get on the phone with our investors to get the deal filled up. That was only a $5 million raise. Fast forward to just a couple of weeks ago and we did a $5 million raise again and we raised it in 25 hours. So, that’s how it should go. So, things have kind of freed up a little bit, but still raising capital is definitely more challenging.

 

And look, who knows what’s going to happen in the future? But again, let’s look at the facts that are going on. Let’s look at the trends. Let’s look at some things that potentially are coming, and decide what the best course of action to move forward with. And for us, it’s still buying, but we’re focused on very good asset class location. We’re focused on still value add but being careful of what that value add looks like. We have done very, very heavy value add in the past. We’re not going to be doing that right now. It’s stabilized buildings that have less value add needed, still upside potential and rents, and a lot more management place versus just the construction play.

 

Josh Cantwell: Got it. Love it. What do you think, if you could point your finger at the difference between the $5 million in May and the $5 million a couple of weeks ago? Was it just fear? Was it the fear of the unknown, people, investors just holding back to wait to see what happened? Or what could you put your finger on that was the reason for the difference?

 

Todd Dexheimer: I would say that’s probably the biggest reason, yeah, the uncertainty, the fear. I think in May, it was just kind of like feels like things were changing so, so rapidly. Now, we’re sitting here, this raise was in late August or mid-August. And it was like, we’re used to it, like, we’re just expecting it. Yeah, recession is happening. It’s already like a pre-gone. We’ve already concluded it. It’s already here, where in May, it was like, whoa, it’s going to happen. We’re all going to lose everything. And now, it’s like, okay, we’ve calmed down a little bit. We’re good.

 

I think there are a couple other differences. I mean, that project in May wasn’t exactly our traditional project, although I think it was quite frankly better. But our traditional asset that we’re buying multifamily is a bit of a heavier value add with higher upside in the rents. And this had very low upside in rents, more of a management place. So, improving expenses and only raising rents by about 100 bucks a month versus some of these other projects, we’re raising rents by 200, 300, 400 bucks a month or more. And I think that maybe had something to do with it too. People didn’t feel like it had as deep of a value add. However, again, I think it’s going to end up beating a lot of the returns for higher value add just because the price…

 

Josh Cantwell: You never know until you own the asset. Grind the axe and start putting the magic.

 

Todd Dexheimer: Yeah. And within like a month of closing on the deal, we’re already hitting our pro forma rents and overhead and reduced expenses, and so, who knows? The story is yet to be told at the completion, right?

 

Josh Cantwell: Yeah, sure. The other thing too, I was just looking at while we’re talking, I was looking at the 10-Year Treasury and you really saw in March, the Treasury was 1.75, and that’s when the Fed came out and said they’re going to start to aggressively raise rates. And people started thinking, oh, sh*t. And then rates between March and May, went from 1.75 to 3, and cost of that, the Treasury goes up, which means cost of that goes up for any kind of Fannie, Freddie, or bank financing is going to go up. And of course, when the Fed raises rates, then the SOFR rate goes up for bridge loans. So, all of that’s going to go up at the same time.

 

Then, in about June, it kind of leveled off. And it’s been fairly level. There’s been a little bit of volatility. This has been fairly level since June. So, maybe that was just the time, right when things were really volatile, the most volatile, and rates were going up the fastest.

 

Todd Dexheimer: Yeah, I think you’re right, just that uncertainty, and again, now, people are like, okay, this is the ride we’re going to be on, where before they’re like, what ride are we on? I’m not sure if we’re on a roller coaster or a zipline. Or what are we on here? Now, they’re like, okay, this is what we’re on.

 

Josh Cantwell: Yeah. And Todd, some people would say like, wow, you raised $5 million, then you raised $5 million again, like no big deal. And people would be like, holy sh*t, you raised $5 million, and then you raised $5 million again. So, what work? Some people are going to ask me, what work before the raises went into that to have that money positioned and ready to fund deals? And you said, not that you sounded off-put by it, but you’re like, yeah, we actually had to get out of the phone, you know what I mean?

 

Todd Dexheimer: Man, that does sound arrogant, doesn’t it? Now that I look back.

 

Josh Cantwell: You earned it. If you didn’t have to get out of the phone with investors, you could raise $5 million that you’ve done something right, which is what I’m trying to recognize here. I’m not saying it was arrogant, but I’m saying like to say we could normally throw a deal on our investor portal. The investors trust us. They go through the deck, they go through the PPM, they watch the video recording or whatever it is, and they subscribe for $5 million.

 

Whether you had to get on the phone or not is not the point here. The point is, you did it twice back to back, and you’re going to buy $100 million this year. My question now becomes around raising capital. What work, what steps, what things did you do right over the past couple of years to put yourself in that position?

 

Todd Dexheimer: Yeah. I mean, right, that’s kind of a big answer. But the right answer is what you just kind of said at the end there, what have you done over the last couple of years has been what we and I and my team have done for many, many years. I mean, when I look back, honestly, my investor relationships started back in about 2008 and have grown since then and have grown very slowly and mostly organically up until 2017, where I really decided that I’m going to start raising capital for my own deals. And not just capital, I’ve been raising capital, but I mean, syndications, raising multimillion dollars for deals.

 

And so, in 2017, I started my own podcast. I started going to conferences, speaking at conferences, speaking at meetups, local meetups, just putting myself out there. Prior to 2017, when somebody asked me, hey, Todd, what do you do? I’m a real estate investor. Oh, you’re a realtor. Sure, sounds good to me.

 

Josh Cantwell: Right. Whatever.

 

Todd Dexheimer: That’s what I would say because I didn’t want to, I felt like I was maybe being braggadocious if I told people too much. I just didn’t feel like I needed to say anything. Now, when people ask me, it’s a different answer. Not that I spill my guts and say, hey, you should invest in my deals, but it’s being confident about who I am, what I do, and really understanding that most people are genuinely interested, and some people aren’t and then the questions won’t come out. No big deal. We’ll talk about what’s going on with the football team or hockey team or whatever it is.

 

But other people are very interested and will dig in a little bit deeper and have a good conversation about it. And those people become investors or potential investors or leaders or give me referrals or whatever it might be. So, I think just be much, much more intentional about it. Again, being on other people’s podcasts, having my own podcast, and then the communication with investors, it’s just constant communication. You got to stay on top of them, you got to stay in front of them. They have to know what’s going on with your business, how are you growing. Create some of that excitement.

 

And also, every deal we do, look, here’s the thing is, if somebody is looking at, man, $5 million, that’s a lot of money, or we raised nearly, I think, like $75 million over the last handful of years. If somebody looks at that, it starts from a very basic level. It’s not that you’re going to raise $5 million in your first deal. And you didn’t worry about raising $5 million. It’s that you need to worry about how do we get our first $500,000.

 

And then, from there, we got to make sure people understand that we just raised $500,000 that we just closed on our assets. So, getting that awareness out there, telling people we purchased this building and this is what we’re doing and continue to update people. And then the next deal and the next deal and the next deal, we continue to do that, it snowballs. So, it’s just about the preparation in the firsthand.

 

And I feel like we also train our investors, for lack of better words. They understand our expectations. When we have a deal, we have a specific process that we go through. It’s the same every single time. And they know when the deal comes up, we don’t do soft commitments like a lot of people do. As you commit, you’re in. I have a firm belief that I want to deal with people that make decisions. I don’t want to deal with people that are wishy-washy about their decisions. So, if you’re going to commit to my deal, commit to my deal. Don’t come in and have a soft commit and decide, oh, if I want to do it or not. Oh, I’ll decide in a week. No. You’re in or you’re out. And granted, if you see something legal that you don’t like or whatever, sure, you’re out, but you’re in or you’re out, tell me. Let us know. And that’s it. And for that reason, Josh, you didn’t ask me this, but for that reason, like we have a very, very small dropout rate. And so. our deals, when they get raised, they’re done.

 

Josh Cantwell: That’s fantastic. You’ve done 4,000 units. And one of the things I specifically wanted to ask you about, Todd, was you started to do some senior housing. You have your multifamily portfolio, you have a lot of value add, like you talked about heavy value add, heavy construction, and then also more of your management plays, but you’ve also done an offshoot into some senior housing. Tell me about that.

 

For selfish reasons, I’m interested in that. I haven’t done one yet. I’ve got some friends of mine that are pretty far deep into it and done value add, senior living, residential assisted living, or new construction. What in that market did you like? And what was your first play? What was the first thing you did in that market? How did you step into it?

 

Todd Dexheimer: Yeah. So, look, the demographics, they tell the story, right? So, just look at what’s going on, the baby boomer generation, that’s no secret that it’s a pretty big population. If you look at how many people are turning 80 this year, it’s about 300,000 people that are turning 80 this year. By 2027, it will be over a million people that have turned 80.

 

My key demographic on senior assisted living is about 82 years old, 80, 82 years old. So, by 2027, I’m going to have over a million people that are going to be turning that age, that are entering the market. And that’s going to continue, by the way, for about 20 years.

 

Josh Cantwell: Wow.

 

Todd Dexheimer: So, yeah, it’s not just like it’s going to happen one year. That’s going to continue. And you can see, like 2027, and by the way, there’s a lead up to that. It’s not like it goes from 300 to a million in one year, but there’s this lead up to it. But then it continues and it continues and it continues and it continues, and you can see how that will snowball. And there’s not nearly enough. Even though you see senior housing being built right now, there’s enough today. There’s more than enough actually today, right now, but there’s not more than enough. And they aren’t building it nearly close to a clip of what they need to build it at for the population that’s coming.

 

So, the demographics tell the story. There’s going to be a lot of people that– it’s supply and demand. There’s going to be very little supply compared to the amount of demand. These places are going to be 100% occupied. And so, that’s why I like it.

 

How did I get into it? The other reason I like it too, and this wasn’t originally why I had any interest in it, but I really like being able to serve that community. It’s an underserved industry or an industry that has had a tradition of serving poorly. And by that, I mean, there’s just been a lot of abuse in the industry. There’s been a lot of neglect in the industry. And that is something that I feel like we are trying to change. And it’s going to take more than just us, it’s going to take a whole, whole lot of people and really the entire market. But I do feel like this is recognized throughout the industry that it’s a problem. And I do feel like the vast majority of operators are really trying to change that perception and reality of the abuse and neglect that happens within the industry.

 

So, nursing homes kind of used to be, oh, we’re going to send grandma to the home. That’s the traditional abuse that you saw, a lot of abuse and neglect. And so, that’s actually the birth of senior assisted living, and memory care is to get out of the nursing home into more of a smaller home-type feel for these people. So, when did I first buy? 2020. So, right, pandemic, 2020.

 

Josh Cantwell: Wow.

 

Todd Dexheimer: Yeah, I was sent a deal. Hey, you got to look at this. So, the business partner that kind of heads up that part of the business, VitaCare Living, he sent this deal to me. He’s like you got to look at this. I think you should do it. And I kind of ignored him, actually, quite frankly, because I was like kind of want to– yeah, I know all the facts or thought I knew all the facts, but I’m like, I don’t want to deal with that. He kept on kind of poke and poke and poke. And finally, I’m like, all right, fine. I’ll look at the deal.

 

So, I looked at the deal. Numbers look great. I had some money sitting around at that time. All right, let’s try it. So, I got on that deal that first year, made– I don’t know, I can’t remember now, a big percentage, 40%, 50% return on investment, really big number. Actually, it might even be bigger than that. I’m like, wow, this is really good. Let’s try a couple more.

 

And so, we bought a couple more and have not stopped since. And actually, right now, today, we’re kind of taking a pause. We’re not saying we’re not going to continue to buy, but we’re just taking a pause and making sure we got the operations in place that we’re– I just said, we’re trying to make sure we’re changing the industry. Okay, what are we actually doing to make sure that we’re not neglecting our residents? What do we have in place to make sure we’re serving them the right way? Our goal is to add life to the years of our residents. We don’t want to just have our residents live longer. We want to actually add life to their years.

 

Josh Cantwell: Quality.

 

Todd Dexheimer: Yeah, exactly. But what are we doing to actually achieve that? It’s a cute slogan, but do we actually do anything about it? And so, right now, there’s kind of that pause. We have about 400 units of assisted living, and we’re just going, okay, how do we make this thing really, really powerful? And how do we not only help ourselves and our investors financially, but how do we really, truly serve our residents and the staff that’s involved on the day-to-day?

 

Josh Cantwell: Yeah, sure. So, Todd, now that you’ve done 400 units, several different structures, several different deals, what’s your favorite? Is it like sort of residential assisted living with 10,000 square foot house that’s got 10 residents in it? Is it a community? Is it new construction or you’re building maybe several houses on one cul-de-sac? Because I’ve seen lots of different residential structures and because it’s very kind of boutique, you can almost– I mean, one of my buddies brought me a deal, it’s in a country club.

 

And the country club has one corner of the country club in one of the streets where it’s not developed yet. And the guys, they already have basically blessed this. We could bring in, we could build 10 basic group homes, if you will, residents just living on this one cul-de-sac. So, based on what you’ve learned and it’s been two years, probably at a blistering pace because of COVID, what is the structure that you like the most? And why?

 

Todd Dexheimer: Yeah. So, I think there’s a lot of opportunity, as you already mentioned, and there are so many different strategies. What I think you really have to look at as you’re buying or building is right now, you’re serving the silent generation, but you will be very quickly serving the baby boomer generation. So, what are their wants and desires and needs? And so, when I look back at the buildings we first got, we weren’t thinking about that. We were looking at the financials. We were saying, okay, this is working now. Here’s what it’ll be like, okay, let’s buy it. So, we’re kind of buying whatever.

 

Now, in these last couple of assets that we purchased, I bought a big portfolio, just closed out a couple of buildings. We’re really looking at what the layout is, what the setup is, how is it going to be able to serve the residents. What kind of activities can we put in place? Is there a fitness room or is there a room that we could turn into a fitness room? Is there an activities room or can we turn something into activity? Does everybody have their own bathroom? A lot of these, it’s like community bathrooms. There’s just a bedroom. Does it have its own kind of kitchen at? They don’t have full kitchens because most of them aren’t going to cook because they have a kitchenette.

 

So, we want to make sure it has kind of the amenities. So, our strategy is to buy existing buildings owned by mom-and-pop owners that have just really underutilized the asset. Maybe their expenses are too high, the income’s not high enough. They just haven’t run it exactly how it’s needed. And so, we’re buying these existing assets and we’re trying to bring them up to what we feel are modern amenities and modern finishes that are going to serve that baby boomer generation.

 

Josh Cantwell: How critical, as you’ve grown and built the portfolio, bringing in the kind of licensed operator, if you will?

 

Todd Dexheimer: Oh, my gosh, yeah.

 

Josh Cantwell: I mean, critical, but how do you continue to find those people, continue to expand your staff? Because you’ve got to have those people that really know how to work with the seniors on a daily basis that are licensed, that there’s an issue, obviously, their license is on the line. And often, that could be a choke point. Finding the deal flow could be a choke point. But anybody who’s active with acquisitions and networking, talking to brokers, talking to owners can find lots of deal flow, then the choke point becomes the operator, the person with the license. Help me understand.

 

Todd Dexheimer: And that’s what it is, that growing. That’s a real risk when you’re looking at senior houses. Senior housing can be extremely profitable, but if it’s not operated the right way, it is extremely not profitable, and you can lose very quickly. And we’ve seen that with our own buildings. All of a sudden, a couple of things go wrong. You’re like, whoa, it’s going quickly in the wrong direction. We have to right the ship.

 

So, we use a third-party property manager. So, there are basically three ways you can manage a senior living property. The first way is you can manage it yourself, of course. You can self-manage, hire all this staff, blah, blah, blah. You can work in it yourself if you really want to. Second way is to hire a third-party property management, much like multifamily, commercial real estate in general. You hire a third-party property management company. They’re hiring the staff, they’re running the day-to-day, doing the books, all that kind of stuff, your asset managing. The third way is to lease to a company that’s an operating company. So, you’re doing typically a triple net lease and you’re signing an agreement that they come in and they operate the building.

 

All three of them require work on your part, but the first one, obviously, the most work, the second one, the second most work, and the third one, the least work because it’s a triple net, but you still have to make sure the operator is doing the right thing and you still have to look over it because your investment is only good as the operator, so. No matter what. So, we use third party and we asset manage them, and boy, I mean, it’s more work than asset managing a multifamily or asset managing a retail office building, anything like that, so.

 

Josh Cantwell: Got it. Love it. And the structure, the existing buildings, what’s the average size? Like how many units? How many residents are there when you’re, like you said, looking to buy existing buildings that are mom-and-pop owners? How big is that? How many units? Or how many residents? And what’s a typical kind of price point that you might be acquiring at that?

 

Todd Dexheimer: We’re buying buildings that are usually anywhere between about 12 up to about 30 beds. And so, I think the biggest one we have is 36, yes, 36. So, that 12 to 36, I guess, residents. And what was the other part of the question?

 

Josh Cantwell: Oh, just around like price, going in price.

 

Todd Dexheimer: Oh, yeah, price. Man, that’s going to vary so much. It depends on how rural it is. It depends on what kind of city, population occupancy, all that kind of stuff, financials, but we’ve bought as low as $50,000 a unit and as high as 100 and roughly 150 a unit. So, if you’re going to build brand new, expect to pay more. And again, in assisted living, you’ve got some sort of assistance that are going to take care of the residents. So, I think, government assistance, might be full government assistance, might be partial, but you got some sort of government assistance that’s going to cover their rent. They’re not going to pay as much. They’re going to pay, let’s call it, $3,000 to $5,000 a month. And then that depends on all kinds of things.

 

And then you’ve got private pay. Private pay are people that are paying on their own. And that’s a smaller portion. It’s not like multifamily where it’s mostly private pay with a little bit of government assistance. This is probably at least 60% government assistance and then 40% private pay. So, private pay is going to pay typically more, which quite frankly, I’m not quite sure why, because they’re a lot easier to deal with anyways, but that’s just how it is. So, if you got brand-new construction, think about the country club thing that you just mentioned, they’re great location, brand new. They’re probably paying instead of, let’s call it five grand, they’re probably paying 8 to 10 grand.

 

Josh Cantwell: Sure. Got it. Yeah, I love it. I love to see the structure. And do you see, Todd, as you continue to build out your portfolio, kind of continuing to go down both paths? It sounds like your portfolio is still like 90% multifamily.

 

Todd Dexheimer: Yes.

 

Josh Cantwell: And value add in like 10%, 15% residential assisted living kind of continuing. And do you see your portfolio continuing to grow kind of in that trajectory?

 

Todd Dexheimer: Yeah, I do. I mean, look, a lot is to be determined, right? It really depends on how the assisted living continues to evolve and grow. I mean, again, the industry is fantastic, but I want to make sure we’re profitable at all times. I want to make sure our business is doing what we say it’s going to do and not just make money. So, can we achieve what we think we’re going to achieve? If that’s the case, the assisted living is going to continue to grow. It probably will become 25, 35, maybe even more percent of the business.

 

Josh Cantwell: That’s in 2027 and after, right?

 

Todd Dexheimer: Yeah. Look, I mean, there’s a lot of reasons to be in the industry. And so, yeah, I like being able to grow in it. I think there’s a lot of opportunity right now. Properties are undervalued. COVID did a big time– I mean, just destroyed the industry. There’s a lot of burnt-out landlords, owners. This industry, there are a lot of moms, pops that own these buildings that have been working on the day-to-day. They’re there every day.

 

Josh Cantwell: Yeah, they’re with the residents.

 

Todd Dexheimer: With the residents.

 

Josh Cantwell: Feeding them, taking care of them.

 

Todd Dexheimer: Yeah. And they want to retire, they want to be done. And even if they’re not working, they’re still there a lot. And they’re just tired and they’re ready to be done and they’re not doing a good job managing, they’re not business owners. And so, there are deals to be had out there. There are a lot of deals to be had. Again, it just depends. Can you operate it well? Do you have the right team in place? Just like anything, do you have the right team and the people in place?

 

Josh Cantwell: And is it any different for you, Todd, when you’re out searching for multifamily, obviously, you do some direct-to-seller but a lot through brokers, introductions, partnerships, residential assisted living status the same?

 

Todd Dexheimer: Very much the same, yeah. I mean, some are direct to owner and broker and property manager. And so, we’re just getting leads from whoever we can get leads from.

 

Josh Cantwell: Got it. I love it. Todd, you built 4,000 units in a relatively short amount of time since 2017. Obviously, another eight, nine, ten years prior to that in resi and doing some other things, but if I had to ask you, what did you do right along that time? If you could think of one or two things that you thought, hey, you’re making the pivot, growing it, like we talked about at the beginning of the show, even with the speculation of others, I know coming in recession or there’s another upcoming recession, oh, there’s COVID. You kept plowing through. What would be the one or two things that you would point to that you could tell our audience and say, hey, these are some of the things I did right that I would do over again? What would those be? What were some things that you point out?

 

Todd Dexheimer: A preface that I’ve made a billion mistakes along the way. And so, even the things that I’ve done right, yeah, it’s amazing. When you look back, you’re like, man, I did that wrong, I did that wrong. But even the things that I did right, a lot of them I made, they were also mistakes at one point in time. And so, one of the things I would say is I allowed my paradigm to shift.

 

And now, again, that I didn’t allow all the time. I didn’t allow myself to think beyond the box that I was in at all times, but I eventually got out of that little box that I put myself in and allowed my paradigm to continue to shift. And by that, I mean, look, we all have limiting beliefs. We all have this vision of the world or whatever it is and we have to be able to think outside of that.

 

And so, I mean, I’ll give you just a perfect example. I was buying one of four family houses, plugged it along. I started kind of growing a little bit and buying some 10-unit and 20-unit. And actually, it was a mentor that got me out of the mindset and told me that I have no reason I can’t go buy a 100-unit building.

 

And I allowed my paradigm to shift through a conversation with him and just through some reasoning. And all of a sudden, I’m buying 100, 200-unit buildings plus. And it wasn’t anything magical other than I allowed myself to think differently. And looking back, that was just it. The only thing holding me back was just my limitations. So, that’s one.

 

The other one would be really just when I look at how my growth, every time I had a lot of growth, every time, it’s happened because I allowed other people into my business either as partners or as just a part of the team, the employees, whatever it might be. I allowed other people in my business so I grew my team. I surrounded myself with people. And so, every time I surround myself with more people, better things happen.

 

And so, that’s why I’m excited, you asked me at the beginning of the show, what are you excited about? Well, that’s why I’m excited that we’re growing our business, we’re bringing in new people in, and we’re trying to do it strategically. We’re not just throwing everybody into the business, but we’re doing it and we’re going to continue to grow the business because I’ve realized this is not about me. If I can delegate, I go so much further, so much faster.

 

Josh Cantwell: I love it. Todd, you mentioned you made a million mistakes and then almost every success was a mistake that went wrong that you fixed. You changed it. You morphed a little bit. And that mistake, you learned from it, became a success. Is there one story or one thing, in particular, you could point your finger at and say, here’s a real example of something that went wrong, that we paid attention and we modified it, we made it better, we turned the screws a little bit, and that became a massive success in our business?

 

Todd Dexheimer: So, I’ve told this story before– yeah, you know what? I’m going to use a different story that I haven’t told quite as many times. I owned a bunch of wonderful family houses. I owned 100 of them. And I was the property management company. I had a couple of maintenance people and stuff like that, but I was doing the day-to-day. So, I had a rental inspection on one of my properties and I went over there to make sure I was taking care of a couple of things. And so, I got my screw gun in.

 

Actually, this is a little bit before that. This tenant was a problem tenant. And there was suspicion by the police that he was dealing drugs and selling guns and stuff like that. So, I kind of knew that going into this, and so, I tell him I’m going to go to the property, I’m going to make some repairs. Got this inspection happening. And so, I go to the property. And I unlocked the door, and the alarm goes off. And I’m calling him and he’s not answering. I’m like, whatever, I got to get this stuff done. I’m just going to go in. His secure alarms going off, I start making some repairs and walking back out to my truck, and I got my screw gun in my hand and five squad cars fly out.

 

Josh Cantwell: Okay.

 

Todd Dexheimer: Full draw right on me. Down on your knees, they’re like, get down, drop the gun. I’m like, it’s a screw gun. Dropped the gun. They come to me, they pat me down to put me in the back of the squad car, and they go and search the house. They come out, and I’m like– and as they pat me down, I’m like, hey, I’m the owner of it, whatever. They throw me in the squad car. They come back out. They get me out of the squad car. And I’m like, what was that about? You guys could have just checked my license. I’m the owner. They go, well, we knew you were the owner, but we need a warrant to search this house. But since you were burglarizing the house, we could go in without it.

 

So, I’m out free. No big deal. But at that time, I’m like, what am I doing? Why am I at this stupid house in the first place? Why am I in the back of the squad car in the first place? Because I was sitting in the back of the squad car, I’m like, what in the world am I doing here? Like, why am I even in this position to begin with?

 

Now, it’s a fun story to be able to tell, right? I get five guns drawn at me, like that was the first and only time I’ve ever been in the back of a squad car. Super cool. I had a beautiful police officer that patted me down, I kind of joked with, but anyways…

 

Josh Cantwell: Let’s do it.

 

Todd Dexheimer: Yeah. So, look, like man, when I talk about delegating, I just– why was I the one doing that?

 

Josh Cantwell: Yeah, what the hell am I doing here?

 

Todd Dexheimer: Yeah, what am I doing here? And so, you got to think about like, what’s my true vision of my business and where is it going? And actually, are these tasks that I’m doing today and planning on doing tomorrow and yesterday, are these tasks actually, truly moving my business forward? What’s my vision? We write all these goals, we create this vision, but most of us don’t even look at it. We rewrite it, we put it to the side. We don’t ever think about it again. We got to take this stuff out. You got to look at it. You got to think about it. Are you actually achieving something? Or are we just doing the motions? And I was just doing the motions. For some reason, I needed to be at that property that day.

 

Josh Cantwell: What happens after you realize, like, I shouldn’t be here, this is not part of my vision? How does that lead you to the next step? What happens from you paying attention while you’re in the back of the squad car? With the guns, you probably have this epiphany. Oh, my God. Do something different. And then what action did you take thereafter to get yourself out of there? What happens?

 

Todd Dexheimer: Yeah, I mean, what happens? Well, there are two things that can happen. Why did you just keep on doing the same thing? Because that’s just what you do. The other one is you’re like, hey, slap yourself across the face, like you got to kick yourself in the butt. You are in the position you’re in, but how do we change this? And that’s really what I did. How do I change this? How do I stop being that guy that’s running around these properties on a day-to-day basis?

 

And you look at it and you look at, well, obviously, there’s some obvious answers. I got to hire some people to take care of this. I can hire a third-party property management or I can hire people in-house. But either way, I’ve got to hire some people to take care of this, and then really look at what I’m doing wrong.

 

Here’s a thing that I’ve done, and I don’t remember if I did it back then, but I’ve been doing this for quite some time, is I take and I look at my schedule and I write down everything I did every single day. So, starting on Monday, I write down everything I did, starting Tuesday, everything I did. And I do this, this is a daily thing you can do for two, three weeks in a row. And then I grade everything and I grade it 1 through 10. And my 10 is the stuff that I go, this is moving my business along and I really love it. And the 1 is stuff that I go, this sucks, I hate it, and it’s not doing anything. I could hire somebody for 10, 15 bucks an hour to do this stuff. And my goal is to get rid of everything 1 through 8, 1 through 7, 1 through 8. I’m going to start at the 1s, right? And I go slowly get rid of those things.

 

And I don’t remember the day that I did that, but honestly, that’s helped me immensely as I continue to grow. And I would challenge anybody that owns a business or is thinking about owning a business to go through that exercise. Just really write down what you’re doing and grade it and then decide, is this a 1 or is this a 10? And how amazing would it be, Josh, if at the end of it, you’re doing all 10s every day.

 

Josh Cantwell: So much passion, so much fun. That is when you’re doing that kind of stuff. When I look back and I’m like, man, that day was fun, and I have more energy at the end of the day than at the beginning of the day and I got more done and I feel like looking forward to tomorrow, it’s almost always because you’re doing that 8, 9, and the 10s, right? Not only that, but you feel like you’re fulfilling the personal motivation, the personal passion of what you’re trying to do with your life. You’re like, wow, if I could repeat that day 365 times this year, man, how much further would my business be?

 

And again, I think, generally, the way we were created, we’re created to be– like, that’s why people who achieve are special because most people are built, we’re built to be lazy, we’re built to lay around, do as little as possible. So, when somebody like you takes inventory on a daily basis for a week or two or three weeks at a time, and you’re like, I’m only going to focus on the 8s, 9s, and 10s and keep pushing my business forward, it’s like, wow, if you could just do that once a quarter, just a little bit more often, four times a year, once a month, do a one-week grade and say, gosh, how do I keep doing the 9s and the 10s, and that’s also the challenge, Todd, isn’t it, though, that like if I’m going to do the 9s and the 10s that really move the business forward and I’m going to back hire, I’m going to add payroll to do the 1s through the 8s. So, you have to be truly committed to doing the 9s and the 10s because that’s where you could 10x, where somebody might cost you 15 bucks an hour, but you’re making 150 or 250 or 500 bucks an hour.

 

But a lot of people are like, I want to hire everybody else to do all my work, but then they don’t do the 9s and the 10s. That’s the key. I don’t want to do this, I’m bored with this, but then you have to execute at a super high level in exchange. And that’s what you did, Todd. That’s what we do. That’s what I do. But that’s the difference between somebody that’s listening, wanting, and somebody that’s actually achieving is executing on the 9s and the 10s. That’s a big part of it. And I think because of that story you just told, we should wrap up with that so our audience will pay attention and do that little exercise. So, Todd, listen, thanks for being on the show today.

 

Todd Dexheimer: Once a quarter is perfect, by the way. I mean, you said it right on, I mean, once a quarter. And if you can do it once a month, great. But once a quarter, do that exercise. I challenge everybody listening, do that exercise. Whether you think your business is perfect or you think you’re a big hot mess, you just do it. It’s going to make a big difference.

 

Josh Cantwell: I love it. Todd, it’s EndurusCapital.com, correct?

 

Todd Dexheimer: Yes, sir.

 

Josh Cantwell: That’s your website. Any place else that our audience can connect with you, engage with you, a social media or otherwise, that we can throw in the show notes?

 

Todd Dexheimer: Yeah, LinkedIn and Facebook, I spend probably the most time on, although I’m not on either of those very much, but I would say reach out to me, like DM me, so I know that I should actually pay attention to your connection request because I’m pretty bad at accepting requests, otherwise, so.

 

Josh Cantwell: Got it. Todd, listen, thanks so much for joining us today on Accelerated Investor and thanks for all the things that you shared.

 

Todd Dexheimer: Absolutely. Thanks for having me.

 

[CLOSING]

 

Josh Cantwell: Well, hey, listen, so glad that you could join me again for that episode of Accelerated Investor. And as always, don’t forget to press right now on the Subscribe button so that you never miss another episode of Accelerated Investor. Whether you’re on iTunes, Spotify, YouTube, wherever you get your podcasts, iHeartRadio, hit the Subscribe button so that you never miss another episode and you’re notified every time I release a new episode.

 

Also, I hope you’ve been enjoying our episodes around the 9 Traits of Elite Entrepreneurs. These were some of my favorite solocasts that we’ve been doing. If you’ve been missing those, check them out right here where you get all of your podcasts. And also, don’t forget to leave us a rating and a review. If you enjoyed this episode and all of our other episodes, help us share the word, share this all over social media. Leave us a rating and review. We’ll see you next time. Take care.

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