June 17, 2026 · 1 hr 37 min
With Grant Cardone — Founder, Cardone Capital
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Grant Cardone sits down with Taylor Avakian on No Vacancy for a raw conversation on building massive multifamily wealth, raising capital on his own terms, and why he's betting big on Bitcoin…
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Grant Cardone sits down with Taylor Avakian on No Vacancy for a raw conversation on building massive multifamily wealth, raising capital on his own terms, and why he's betting big on Bitcoin alongside real estate. In this full episode, Grant breaks down his journey from car salesman to running one of the largest private multifamily portfolios in the U.S., the lessons that shaped his approach to deals and capital, how he thinks about scale versus location, and his forward-looking views on markets, technology, and the next phase of his business. Chapters: 00:00:00 — Grant Cardone's Opening Rant on Real Estate Capital Raising 00:01:20 — How Grant Learned Real Estate Growing Up 00:02:31 — His Father's Influence and Early Exposure to Property 00:04:28 — First Deals at 28 and the 3-Year Study Period 00:05:39 — Houston Market Collapse and Move to California 00:07:13 — Buying Nearly 200 Units in 90 Days in San Diego 00:08:38 — Raising Early Capital and the Mom Loan Story 00:09:54 — Building a High-Income Sales Consulting Business 00:12:56 — Car Sales Lessons: Becoming Top 1% and Finding the Glitch 00:16:17 — Developing Ambition and the Drive to Be Recognized 00:18:03 — Hitting the First Million and What It Felt Like 00:19:41 — Why Owners Beat Brokers: The Rudy and Dale Partnership 00:23:44 — How Grant Evaluates Deals: Always Know Your Exit 00:24:53 — Value-Add Realities and Selling to Sophisticated Buyers 00:27:42 — What He Would Do Differently If Starting Over 00:28:21 — Evolution of Deal Structures and Dropping the Pref 00:30:04 — Raising $2 Billion from 20,000 Investors on His Terms 00:31:40 — Long-Term Holds and Why Many Recent LA Deals Struggled 00:34:xx — Market Predictions: LA, Orange County, Dallas, Miami, and More 00:38:37 — Asset-First Approach, Building Audience, and Exiting to Whales 00:44:xx — Advice for Ambitious Young People: Grind in Your 20s 00:48:xx — Sales Mastery: Studying Buffett, Elon, and Trump 00:55:xx — Focus on the Best Assets First, Not Investor Terms 01:00:xx — The Sacrifices Required for One Life-Changing Deal 01:06:xx — Tax Strategy: Live Lean and Invest Aggressively in Multifamily 01:07:33 — Favorite Markets and the Monopoly-Style Concentration Play 01:09:57 — LP/GP Structures and Using Assets to Attract Capital 01:13:xx — AI's Early Impact on Real Estate and Future Opportunities 01:27:xx — Property Management as a Major Competitive Moat 01:29:xx — Grant's Vision for the Next 5–10 Years 01:35:22 — Closing Thoughts and Bold Future Plans Subscribe and Stay Ahead! Stay informed and empowered in the multifamily real estate market. Subscribe to the channel for exclusive insights, rental updates, and expert analyses on the Los Angeles market. 🔔 Don’t miss out on the latest trends and tips to maximize your property's potential: https://www.youtube.com/c/TaylorAvakian 📈 Connect with me: Website: https://www.thegroupcre.com/ Email: taylor@thegroupcre.com X: https://x.com/TAYVAY_ LinkedIn: https://www.linkedin.com/in/tayloravakian/ #realestate #podcast #losangeles
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This is the problem with the real estate industry. I got to return the money in 3 years. I got to return in 5 years because they're [bleep] You guys that raise money, you're [bleep] You go to your doctors and your lawyer friends and your chiropractors. These guys are laugh.
You're [bleep] [bleep] Grant Cardone is an American businessman, influencer, and writer. He is the founder of Cardone Capital, a company that manages a $5 billion
real estate portfolio. I have more Bitcoin per unit than I have units. I have three Bitcoin for every unit. at some point that Bitcoin should do what the real estate cannot do. I'm going to be the biggest disruption to the reed industry. They have no real money for expansion. They can't even buy their own shares back. If you go out in the Atlantic and you go fishing, first thing you're going to do is you're going to go wherever the other [bleep] boats are. I lived in LA for 14 years, never bought a piece of real estate. The best deals in the marketplace are the bigger deals, better locations, institutional quality where these guys have to take out sheets of paper and say, "Take the top 12 lots." It's not that we don't have enough housing. There's plenty of housing in LA. It's just not desirable housing.
Like, the fact that you're still there is crazy. You should just move, bro. If I was 18 years old today, I'd be doing AI consulting for companies and making a couple million bucks a year and then I'd be parking all that money in real estate. People are trying to do the next thing without giving up the things they have. You need to sell your house. You need to sell your cars. You need to sell your furniture. Bro, I sold everything. Everything. Grant, welcome to the show. Appreciate it. Thanks, man. Thanks for having me.
Take me back a little bit to uh the beginning from how did you learn real estate?
I think my my dad my dad when I was a kid my dad passed when I was 10 or nine and a half or something. So I didn't have a lot of time with him. Maybe there was three summers where I kind of really remember hanging out on the weekends. And he was a stock broker during the day from 1958 to 1968. There was a bull market in in the stock market. And my dad had lost uh an insurance job. He was starting an insurance company, had it taken away from him by his partners. This is the story I was told. And he became a stock broker, five kids, restarting his career at 42 years old. Yeah. And he would pass at 52. So they only had 10 years to to work it out. And so he's banging out stocks during the day, but on the weekend we would drive
around look at real estate. and he'd put five kids in the back seat and him and mom would would be dropped around. Oh, look at this piece and look at this piece. So, I I I think I inherited some of that fascination with looking of real estate, if you know.
Was he trying to invest in it or was it?
No, not really. Not really. You know, you back then it was like, hey, buy a house, you know, own a home. If you own your home, you're in the middle class. That was that was the the concept, you know, back then, which was real. It that was that was a real asset. Yeah. Yeah. Then my uncle, his brother was accumulating section A property, having my dad passed. So I knew that was going on, but it wouldn't be I was 28 years old when I bought my first piece of real estate. I just always understood naturally, innately, you get money, put it in something better than that, just sitting at the bank.
I was never a stock market guy. Maybe you understand it or because it was
Yeah. I did I didn't you know or or maybe it was cuz my because of me watching my dad be a stock bro and shopping real estate.
He wasn't shopping snacks on the weekend. He was shopping real estate. Did he have ups and downs in your guys in cup?
Like was No, he was very stable. My dad was very much a people person. Uh you know tremendous work ethic, very ambitious. Yeah. I would find all this out later. I didn't know it then. I think I inherited his ambitious dream, but you know, his ambitious gene, but I didn't know he was ambitious until probably 20 years after he passed. I was 35 or 36 years old. And I met his brother, his other brother, Joseph. I was probably 45, actually. It was probably 35 years after my dad had passed. And he's like, "Your dad wanted to be a millionaire." I said, "Nobody's told me that. My mom didn't tell me. Uh my uncles didn't tell me. Yeah, your dad wanted to be a millionaire. He was driven to be a millionaire." Well, by that time I was a millionaire when he was telling me this.
And I think I'd owned by that by then I probably had I had two little small consulting companies and how many apartments would I had that I'm 40 45 years old at the time. Um probably 40 years old. I don't know. Maybe 500 units.
600. So you had a you had 500 600 units at 45. When did you start buying deals?
I started buying deals when I was 31. I did my first two deals at 28. Okay. Didn't do anything for three years. I bought two single family homes. Okay. And then studied for three years. Who? They moved out. Who did you study? Samzel. Yeah. Donald Brand, Fred Trump.
Okay. What' you learn from those guys?
Multi you you you need scale. Can't buy single families. I'm like, okay, I'm buying single families and they're building they're they're they're building out multif family. So, it was the number of units. Like, that was my aha. I didn't I didn't understand it until the chick moved out. I I rented a place. I was making 400 bucks a month, $200 mortgage thereabouts. I was making 200 bucks. I was like, "Shit, this is unbelievable." And then she moved out. It was fine as long as she was there. When she moved out, I'm paying $275 a month for a mortgage. And that hurt. Sold it right away. Got scared and sold it. And realized I didn't know any of that. I didn't know how to rent it. I didn't know how to advertise it. I didn't And so I studied and and and
I started, you know, walking with brokers and on the weekends. I probably spent 150 weekends just talking to brokers. Where were you in it? Houston. I moved from Lake Charles to Houston. And this was late 90s, mid 90s. The lake uh sings zone collapsed. There's 600 banks that collapsed in the country. It was a like it was Armageddon, bro. Terrible. And I went to the on this trip to San Diego and fell in love with San Diego Laoya, California.
I moved to La SoCal. Okay.
La Hoya. Yeah. I was just You moved to La Hoya and you left. I moved to lawyer disc. Yeah. Okay. I done all this research on Houston shopping Houston real estate and really I it was a waste of time. It was like I'm I'm not doing it. I'm just learning. But there was no score for three years. It's a lot of study. and left Houston and realized the Houston market actually recovered. I'm like, man, if I'm ever and I realized what I lost, what I miss by not buying. And I said, if I'm ever in this situation again or hint or smell this or get a scent of this, I'm going to buy next time. Well, me and my buddy Dale Christensen, it was 1997, 199 late 90s. We're driving through San Diego, California. had these two little companies and I'm driving around.
I see a Ford PL brand new Ford truck and another Toyota over here and a luggage. Dude, this is it. Dude, market was terrible. But I saw some stuff starting to happen. I said, "This is what I saw at User 3 years before and literally within 3 weeks I bought uh 48 units in Vista. 30 days later bought 38 units in Pool Loma." Where'd you get the money? Um I'll tell you in a second. 48 38 and then I bought a then I bought a 92 unit I bought 190 units or something thereabouts in like 90 days. The point is there was all this pinup understanding now and when I saw it I'm like go. So my consulting companies were producing a lot of cash but I never had enough cash to actually do any deal.
So I would get almost all the money and then have to go to somebody and say I need 90 grand here or I need to take money out of my account or I had to go use some credit cards.
So I, you know, a piece band-aids family friends kind of money stuff.
I wasn't doing friends and family. I would do like I'd borrow money from my mom. I I wouldn't let her in the deal. Got it. Like my mom my mom did I went to my mom one I said I need 90 grand for a deal. I don't want to be an investor. I said okay don't don't be an investor. just lend me the damn money. Okay, I'll lend you the money. I said, okay, well, I'll pay you a percentage. She's like, I don't want anything. She's just paying me back. There's a lot of that money out there, by the way, where fa families like they don't want to be a partner. They don't want anything to do with the investment. Like, literally her money I I I took her 90 grand, stacked I did 350. So, I took 260 of my own money, 90,000 of her money. That
$350,000 turned into $3.1 million in 37 months. What do you think I gave my mom?
I hope more than 90. I go 90 grand. I gave my mom a 90 grand.
Here's your 90 grand back.
Did you make a lot of money?
I said I made $3 million. She's like, "Good for you."
She didn't want She just wanted to use See,
she just wanted to help me. Yeah. She didn't want to be a partner. And I think that's very very important for people to understand like because if I had pushed on the partnership thing, I don't think she'd have given me the money.
Sometimes it's all it takes.
She's just wondering if you right. Yeah. So that's that's how I got started in real estate now. We own, you know, 15,000 units
now. And you I mean Yeah. Quite a what 5.1 if we're measuring the
market. We're probably 5.3 billion dollars of real estate today. And I'm about to close on about $900 million worth of stuff. So the next time you talk to me, it'll be over six billion.
This is a big deal you're talking about on Graham's podcast or is this different? Oh, it's different deal.
Different deal.
You got another one?
Yeah. Another song going another one like BJ
Cass. I love that. Okay. So friends and family money and stuff, that was kind of where it went. And then you were building up this consulting business at the same time. So the sales and the uh speaking engagements, all this stuff, this was really where your business was taking off, where a lot of the money was coming from. And real estate was this investment Look, like I was on the
road 200 200 days a year. I was basically a fractional consultant
to big corporations, large retail companies that that wanted to drive revenue and I was an expert in finding little little ways for these companies to increase revenue. Give me an example. Nissan Motor Company. Okay. Uh we we went in and showed them how that their their sales process the average sales process was over four hours and we shrunk that to 40 minutes and increased the the margins on the purchase. Where did you learn that skill? Uh well I was in the auto automobile business.
Got it. You're selling cars?
Yeah, I sold automobiles from 20 from the age of 23 till uh
29. And you didn't want to get into the dealership business?
Nah, I never thought about it, dude. I never I never thought about, man, I because Yeah, I don't deal car dealerships.
I would own like 80 car dealerships today. My next door neighbor where I'm from, he owns uh about
10. I probably know I guarantee he has me. He really every car dealer does every car dealer in the country.
They either know of me, heard of me. Because you were calling to to to sell him. Were you doing wholesale deals?
Well, we were doing basically what happened was when I was a kid, I'm 25 26 years old. just clean my life up. Yep. And the sales process back then was the longer you spend with them, the better chance you have of selling. Okay, this was the idea. Okay, build value. Don't disclose price. Basically, was it's a whole hide the weenie carnival and just get them there and then, you know, build value. Well, this is 1983. No, there's no internet. There's no phones. There's no there's no data. Nobody has anything. Yeah. You know, you had to be connected to a bank. You had to have a bank, a friend in a bank to get a blue book on a car. There was zero data for anyone. Jeez. At 25, I made a commitment to become very aware of my surroundings and
start really paying attention to what was going on and become a professional salesman. And I noticed that the people that paid me the most money in the shortest period of time were always the best, most wellto-do people. And I correlated that with, oh yeah, sure, people will go four and five hours, but it was the bottom of the food chain that will go four or five hours. It wasn't the top of the food chain. The best customers, the most qualified, the ones with the money, the ones that would buy the second, the third, the fourth, the fifth car, they're like, "Hey, they want to come in and get out. They they they don't want they're people like me. They value their time. They're like they they'll play around here." Now, somebody with no credit, you know, but sure. Yeah. Yeah.
They they'll spend three days with you if you can get them approved. Yeah. So anyway, I kind of turned that process on its head and I became I I reached the top 1% of all salespeople in in in uh in America. And I wasn't a good sales. So I learned I just learned a glitch. I I I found a glitch. Interesting. And uh
how much money were you making at the time?
I was probably making uh as a car salesman uh maybe uh I think my best year was 90 $3,000.
Oh, okay. So, you weren't making like millions in Dude, that was a lot of money, bro. That was like 300 grand in Lake Charles, Louisiana. Oh, shoot. Yeah, of course.
You were the king of Lake Charles. Well, it was better than working in a refiner. Yeah. And then and then I've always been a very frugal person. So, I you know, if I made 93,000, I kept 93,000. I didn't spend any other thing.
You're ambitious though.
You wanted to grow. Well, not really. Really in my 20s. In my 20s, I don't think I was really that ambitious, you know? I wanted to do well. I wanted to win. I wanted to be the best, but I wasn't ambitious. You know what I mean?
Like, so you don't think you were born with that?
Born with ambition. Uh, I don't think so. Because I never thought about being a boss. I had never thought about even when I started my first company, I worked for another guy. I would I I'd still be working for him if if he if the guy wasn't an idiot. Yeah. You know, I was never thinking about I'm going to build an empire and I'm going to build I always always got, you know, I'm I'm just thinking about this because you asked me that, but but like when I would read books about Aerosol Onasses, the the Greek shipping, I'd get inspired, right? Like that was very inspirational to me. But you got to remember like back back when I was growing up, you didn't have access. You had to go look for this [bleep] Today it's just you're just getting punched with it on Instagram every day.
And so I wasn't thinking about I'm going to own companies and I'm going to run I'm going to have a billion dollar corporation. I I I I wasn't thinking about that. Like I left this I was consultant. I was doing 250 gigs a year working for this other guy. I was in this car sales. I was the best car salesman in in the town, maybe the state and I'm in this little town. That that was important for me to be the best. And then I went and worked for this other guy in Chicago. I I outproduced four or five people there. I loved being the top producer, the Tom Brady, but I wasn't thinking about owning his company. And then I left him. It was an argument. It was never going to work. He had a bunch of problems. And then I went started my own deal.
I started my own deal because I left him, not because I wanted to. I didn't leave him to go be me. Yeah. Okay. I'm ambitious now. I know that. I'm more ambitious today than I was when I
was If anyone said 30, if if I talked to anyone and they said, "Is Grant Cardone not ambitious?" I think they would no one would say you're not ambitious. that seemed like it was ingrained in you because I feel personally for myself, yeah, if I'm looking at, you know, that people can go back to this uh childhood trauma or whatever happened when you were young and sometimes I have I think I have a level of self-awareness that um is is hyper self-aware like you really dig into your personal self.
Yeah.
Spend a lot of time studying and reflecting and I love like Aristotle and Nasis. I love my favorite podcast that I listen to is called Founders cuz they study and explore these titans of the industry from the history. Yeah. And he basically studies these, you know, the Rockefellers, the
Carnegies, like there's these patterns that you can see from these people. Those guys were gangsters. Oh my gosh, man.
And and you can see these through lines throughout their careers.
Yeah.
And understanding and what I think you can learn from their mistakes and their their wins and positives and and stuff like that. And so for me, it's trying to reverse engineer and whatever I'm doing, which is right now we're selling apartment buildings in Los Angeles. It's like how do I create that system and take what they've done and and put it into what I'm doing, right? And so it feels like that's a natural thing that I'm inclined to lean into. And I felt like I've been ambitious, but it sounds like this gradually happened for you where one thing in front of the next to step step.
Oh, I just wanted to be good at whatever I was doing, you know, and I wanted to be seen. I didn't want to be ignored. I remember being a a bel a best um the guy that cleans up the dishes on the table. Uh bus boy. Yeah, I was a bus boy. They never made me the waiter. And I hated it, dude. And I hated walking up putting the water down and nobody would even recognize you. I was at working in a country club. I hated not being recognized. Yeah. Not being acknowledged. Like I was a ghost. And so I don't know what drove that, you know, may maybe who knows? I mean, I don't I don't even care. But yeah, man, I want to be recognized in the field that I'm in. I want to be recognized as at least, you know, I probably
I don't have to be perfect, but I want to be recognized as I'm great at what I do. For me, I I I want to see that for me. But I never thought about I'm going to own six companies. I'm going to own an office building with 11 floors in. Mhm. You know, now I think about that stuff because I I needed some victories to kind of open up. You remember the first time
possibility? What was the first time when you're like, "Oh [bleep] that was a that was a win. That was
a Well, I had I was 31. I looked at my I remember I was in Laoya, California. I just bought this house over there and I looked at my accounts and I had like a million one accumulated and uh I lived with this this girl in in Laa and and I remember first thing I did was call my mom and I'm like mom I'm a millionaire you know it really didn't mean a lot to me but it probably felt special and not really not really it it was a little scary really it was like okay what do I do with this it was a million one and I looked up it was separate outs and I'm like I have a million of $1,100,000. It was a little scary because I'm like what am I going to do with this? And um and I also knew I was
aware enough to know that the job that I had, dude, if anything happened to me, all my income is dead. It was over. You were building wealth. You didn't have I wasn't build a building. No, I was I was building income. Yeah. And and I was basically a prostituer. Yeah. And by by the way, that would go on for the next 15 years. I would continue to to labor like that. I couldn't give up the drug,
dude. I feel that very very much because I'm It's the same thing for me. Uhhuh. Right. You're you're selling I'm a saleserson. Yeah. I'm building you got to own real estate. You got to build something that's building enterprise value equity. And that is the biggest struggle that I have with the job is like you can't sell your book a business and as a broker.
Yeah, you can't. It go it's relationship. You're call broker for a reason. Yeah. There's a hint broke
or [Laughter] I have never met broker.
Yeah. Broker than the owner.
Yeah.
Yeah. You know, this is the crazy thing, dude. I met a lot of brokers and agents. Yeah. Like, you
know, I remember a guy named Rudy Medina was like, "This is a great deal." I said, "Fuck, if it's that great a deal, why don't you buy?" And by the way, he didn't and I did. Uh Rudy Rudy was a guy that Rudy helped me get in the real estate business and he worked at Marcus Milich. Yeah. And he I called him up. I said, "Hey, you got this listing." And he's like, "Come to my office." That was always the pitch there. You got to come to me. I'm like, "I ain't coming to you, bro. You got this [bleep] you got it backwards.
Why am I going to come to you?
But that was their pitch there. You had to get an appointment. Okay. Very similar to cars. Yeah. Come to us to see the car. This is the way people bought cars back then. Like you had to go to the dealership. Now you're getting them delivered to your house. Yeah. And so um I said, "Rudy, why don't you do this? Okay. I'm the one with the money. I'm the one that's going to buy the deal. I'm the one that's going to sign the goddamn I ain't coming to you. I knew this. I mean, I knew at least this. Yeah. You're going to get in your car. You're going to drive your ass to my place and you're going to come tell me everything about the Spart. Sure enough, he came. And then I hired him away from Marcus and Milichap. I said, "You are going to help me buy real estate.
You're going to manage the real estate. You're not going to put any money in it. and I'm going to buy I'm going to buy I'm going to become I'm I'm going to own a bunch of real estate and I'll make you a partner in San Diego. In San Diego. Now Rudy Rudy was didn't believe it. So he sold me two pieces of real estate and I made my best friend the partner. My best friend didn't have a job. His name was Dale. He had $52 was 52 years old. And I said, "You're going to manage the real estate. You're Rudy didn't do do what I said. You're going to manage it. You're going to handle all the phone calls. You're going to collect the rental checks. If you ever steal from me, the deal's void.
But if you don't steal from me and you do everything, once I get my 12%, I'm going to pay you 25% of the upset. I need 12 on my money. Mhm. Anything above that, when I sell it, refinance it, whatever, I'm going to make you a
25%. Man, you're g 7525 out the gate equity. No, I had no clue what I was
doing. He made $12 million. Holy crap. So, I made about $40 million on that real estate that we bought together through refs. Uh, no. No, we sold. Oh, you say anything? I I regretted. I didn't know what I was doing.
Yeah. Shoot.
Okay.
I should still own all that real estate. I was going to say I wanted to stay. So, um I know buildings. I know apartment buildings. I know deals. I know what a good deal is. I know what a shitty deal is. Right. Like this is Oh, then you should own a bunch of real. Well, I know. I know. I didn't have the cash. I didn't have the cash in time. I'm I'll be 30 this year. Whatever, dude. No, no, no. But now I know.
Alexander the Ray. Not knock off the Alexander the Ray was 16 years old. He was leading men three times his age.
That dude was pretty badass. Yeah. I'm not going to I'm not going to disagree with that. We were We were going to war. Alexander Hamilton who signed Declaration of Independence. They were like 1920 21.
Exactly.
So you being 30 means you're an old man. I know I am mold. This episode is sponsored by Loan Titan, a leading residential financing loan company specializing in both conforming and non-conforming mortgage solutions. Loan Titan offers Fanny May, Freddy Mack, nonQM, and private money, hard money loan programs, helping borrowers who need flexibility beyond traditional lending guidelines or speeddriven financing solutions. Whether you're purchasing, refinancing, or investing, Loan Titan is known for smart structuring, clear communication, and reliable execution. Visit loan Titan.com and mention Taylor Avakian to get started. Thanks for loaning Titan for supporting the channel. When you look at a deal, how do you know it's actually good? Cuz well, I studied I've co-star, right? I know the deals. I studied the recent acquisitions. I went back and looked through fund 29 and fund 30. I want to talk about those a little bit, but like you're looking at a
deal and I saw your interview with Ken Maroy. Yeah. And you were saying if I had to start over again, I wouldn't have done the value ad stuff, which is very interesting to me because I'm a big value ad guy. I love buying basis. Basis is the way that I look at deals personally cuz I'm protected from my downside risk.
Yeah.
When you're looking at a deal, how do you know that you're going to make money on it?
Because I know my exit.
How?
Well, because I know when I buy something, I you should know exactly who your target is on the way out.
Okay.
But you're not selling. Just because I'm not selling doesn't mean I'll have a target to exit.
So, you're talking about like a bank.
You going to ref a bank could be a target. A bank could be a target. Fanny could be a target. Okay. Uh Met Life could be a target. Blackstone could be my target. Okay. Like I always know my target. The problem with value ad is your target's a broken terminal financially.
Okay.
So, when you buy a deal for a million dollars and you're trying to sell it for$2 million, that's going to make you five times your money. I'm going to put 200 grand down on a million dollar asset. I'm going to sell it for double what I pay for it. A million becomes 2 million, but I only put 200 grand in. So, I'm making five times for me. Five, I guess. Yeah. So, unbelievable. But the problem is when you're selling a $2 million asset, who you selling it to? Mom and pop. Doctor, lawyer, chiropractor. They're not They're not very Well, they're not sophisticated.
Correct.
I love some of those. No, I hate selling to not sophisticated people. They're emotional.
Yeah.
But and they're not sure. They're uncertain. The big money. It's backwards. I I I used to believe exactly what you believe. You got to understand, I've I made the full cycle all the way around the block now. And it doesn't mean that I wouldn't buy value ad. I'm buying a value ad deal right now in Tampa. Okay. So So it's not like I'm taboo value ad, but I have to know who my exit is. So you know before so like I bought 800 units in Nashville. Okay. I knew when I bought the deal it was complete value. It was garbage real estate a bought it because 800 units it already had a lo it had a bad loan on it. I put $5 million down and controlled 800 units. And I knew for sure I was going to make six times mama.
I knew I'd make 25 to 30 million bucks. I didn't. I made 43 more. But I knew who I'd exit to. I was going to exit to a guy that wanted a big portfolio. So, I'm trying to crack a whale. You see, you're you're trying to catch you're trying to c you're trying to catch from the bottom of the food chain. They don't have big appetites. I mean, they do maybe, but the problem is, dude, they're measuring everything and they don't have a lot of confidence. At the top of the food chain, I have maximum confidence. They're very analytical, and they have a big problem. They have more money than they know what to do with and they would rather do a bigger deal than do a smaller deal. The chiropractor, he's trying to [bleep] he's trying to pull money together and he he just
doesn't have a lot of certainty. Yeah. So, he's only going to pay so much. I'm dealing with guys that are like, "Dude, the more we could pay you, the more h the happier we are." Okay? We'd rather buy 10 deals from you at one time or your whole company. See, that's my accent. You understand that? So back then when I was doing it, okay, uh, first of all, I shouldn't have exited anything I bought. I was buying great real estate.
I mean, I look, I made a lot of mistakes, too.
That's gets where you are, though, you know, but but back to what you were saying that that that that interview with Ken was I would have bought first of all, I would have concentrated all my purchases. I'd have bought lower cap rate real estate, okay? Less cash club in better locations. I'd have bought La Hoya rather than Chula Vista. I would have bought Mory Point Loma rather than Vista.
But how could you have raised the money to do those deals?
And by the way, I would have raised money right from the [bleep] get-go. I should have been raising money when I was 31 years
old. And you would have done what he said was he was doing 9010 at the inning because you didn't have the tracker. So like here's the way I'm thinking about it, right? Because I understand. I looked I would have never done a 9010. Okay, fair enough. number.
But I looked I looked my first deal was a 6535 and they all made a
fortune. But this fund 30 is 8020.
No prep. Fund fund fund uh 30 fund 20 28 and 29 or 8% press.
Yep. And 50/50. And the new one is no prep.
8020. No prep 8020.
I mean 20 over zero. I know. How did you get why why' you switch the Why did you switch
the Well, I did a 6535 with my brothers, my sisters, and family members. Okay. Um, I think it was a six pre and a 6535. Okay. I made it up, bro. It's all made up. Everything's made up. Yeah, it is. Um, we dropped the pre in during co said I'm not doing a prep and we started raising more money, not less money.
Why do you think that is?
I think it's because we started buying a better asset and people So, I said I'm dropping my prep. I woke up and I'm like, the prep is [bleep] It's completely [bleep] Okay. The prep was made up by the pension buds and the big lenders. The big the big lender be like look like I could go to JP Morgan as you know right now and say, "Look, I'm going to put a hundred million in. They'd give me a billion dollars." But they're going to dictate. They're going to be like, "We'll give you a billion grant. You run the project. You get your little point to manage it. But we want our 8% prep." See, they set the rules. That's why I started crowdfunding. That's why I've never gone to them for money. Well, because they tell you when to sell, too. They tell me when to sell.
They tell me when to get the money back. They tell me everything, bro. Like, as long as everything's good, everything's fine. But the moment there's a glit that there's a problem, then they dictate the terms and I'm not the owner anymore. I'm just along for the ride. But it's easier to get one big check than it is to get a bunch of little checks at 500 grand each. Now, we've raised $2 billion like this. When everybody said I it wouldn't work, and everybody said it was going to be a problem. Blackstone was laughing at me and all the big institutions like, "This is a joke. this kid, this guy on Instagram raising
money. Now they're all trying to duplicate what we did.
How much how many investors is the 2 billion?
20,000. 20,000. Uh-huh. Two billion. We'll hit two billion this month. And and so it's going it's going all over the place. 6535 7525 80 20 took out the prep. No prep, no promise. And that was a smart thing to do. By the way, not having a prep is good for the investor.
Well, for sure. Because then you're not pressured to have to go and acrue that.
Yes.
On the And I don't lose my real estate. Yeah.
Exactly. And I And I'm not getting choked out. Yeah. And having to return the property because I'm like there's there's no money in this for me ever. And so if your partner and this is for anybody that's investing in real estate, if your partner is not going to win, you guys are going to lose the real estate. And that that's why all these syndicators come and go.
So, like let's talk about that because the last 5 years um anyone who bought a deal in Los Angeles, right, from pretty much 2020 to 2025.
Yeah.
May 24, I guess they had some good deals, but like they lost money. Yeah. The buildings are not all the equity's gone.
Yeah.
It's gone. Wiped done. Right.
And uh so the managing partner, the GP is probably like lost interest.
He's out, right?
There's no there's no upside. There's no future where he There's no future for him to refi.
He's got to put cash money in. He's got to go to his investors. He doesn't want to do that. Not going to go through a He's got to do a capital call. Exactly. And And that's just not happening. So a lot of the deals
So he can't raise money for his current deal. Can't raise money for new deals. Can't pay on the deals he has. Yeah. He's out. Yeah. He They got wiped out.
They're gone.
Yeah.
You guys bought buildings in the last 5 years, right? But you have a long-term hold mindset or like how are you getting
We got We have 10 years.
This is our terms.
Yeah. 10 years with discretion to go another 10 years. Okay.
Okay. How does that work?
Nobody. Nobody has that. No, this is a 10-year investment. Your money's gone for 10 years. You're not liquid. And I have discretion to hold for another 10 years. There is no prep. And um it's 8020 on the
money.
We pay.
And by the way, we pay every month. Why would somebody do that?
Yeah, cuz the assets are minor. Okay. Amazing.
Can't they go invest in a Blackstone RE?
Sure they get.
Why do they invest?
You won't know what you won't know what asset you're investing in. It's true. You You'll have no [bleep] clue. They're buying garbage, dude. When you get to 280,000 units. Nope. No. I I don't want to use that them as the example or as I'm doing business with them.
Yeah.
Yeah. But but when you're when you're buying from from a a Starwood, anybody that's got 80,000 units, 140,000 units, 280, thou these massive breaths, you there's not that much good real estate in America. Okay? There there's maybe maybe 40,000 units in America that are pristine, perfect locations, great assets. There's not there's not unlimited amounts of great real estate in America. There's only 50% of the or 80% of the population lives on this side of the Mississippi. Yeah. And nobody lives over where you are. Okay. And then and then there's only 20% of the population in America lives on the other
side.
Yeah. And then 50% of everybody lives in the, you know, probably 20 cities. So it's like great real estate is very very precious. So what we do is we buy So when you get to 280,000 units, you cannot be selective. When you're raising$10 billion a month, which is what they were raising back in 2021, 10 billion, two and a half billion every week. They were having to place that money. you're just buying garbage. And so we weren't I I was small. We could move fast, but we could be very selective. And so, but the problem with that is you got to look for dips. You got to look for, you know, little spots. So, when COVID hit, we were able to buy a bunch of real estate from institutions. We only buy from institutions. So, I'm buying from a whale with
the goal to sell to a whale.
And you think there's still alpha in that because they haven't managed it right.
They haven't done the actual business plan like that they they can never manage that. H how can Goldman Sachs that owns office, hotels, apartments, storage, data centers? Okay. Like the big the big REITs right now trying to sell their REIT portfolios. Yeah. To move to data centers. Yeah. Okay. There's one group trying to sell half of their real estate portfolio to put it into data centers. When you own when Wells Fargo owns all this stuff or Scarwood owns all this 120,000 affordable, how can they pay attention to her? Well, they're not running it though.
Well, they got a Jeep.
They're not the guy that bought it. Yeah. The guy that made the decision on it. I've been in these meetings. I was in DC with one of these big groups. He brings out a spreadsheet. This a ma massive institution. I said, "Hey, what do you what do you have that I can bonut?" Takes a sheet 56 pages. Every page has 32 lines. 56 times 32 lines. And every line is a property. And every property is worth at least 30, bro. 30 lines, 56 pages. Take whatever you want. Just tell me what you want. Market. All of it's going to be sold. Holy [bleep] So So we took 12 of them. I want these 12. Made an offer and they're like, "That wouldn't do it, but this would." I said, "I can't get that number. Nobody can." Well, we're not gonna sell or we're gonna wait.
Like, it's just, dude, dude, they're like, they're not they're not I said, "Have you ever been to any of these properties?" Of course not. When the guy that bought them was there three years ago, he blew out. New guy comes in, they're they're they're managing they're managing lines on a spreadsheet. That's why you're asking, "Can I manage better?
Is that the alpha?
Maybe. But I could pay a little more attention. I can brand the building. I could tell them there's a Grant Cardone 10X building. I can allow my I can offer my tenants to invest with us. By the way, we do that. That's the first round. Really? Yeah. The first round is like we bought 366 units out of bankruptcy in Bokeh fun 28. Yeah. And we went to the to the 366 residents there and said, "Hey, by the way, we're taking over the building." Oh my god, thank thank God. Uh, you know, it's going to be better maybe. And then we said, "Hey, would you guys would you can rent here or you could invest here?
You could do both." How? So, as an LP. So, like they're not it's not like rent, but they're
they're an LP. They don't That's awesome.
What's the deal?
It's an on that deal. It's an 8% pre prefer. Yep.
But we added 100 million of Bitcoin to it. Yeah. That Bitcoin transaction that was super interesting. Um cuz I I I watched the Gra the Graham Stefen podcast. I watched the Ken one. I watched a couple other ones. And the Bitcoin is super fascinating to me. One because I was trying to figure out if there was some sort of tax play with that. Um because it was just super fascinating to me. And I know Bitcoin has been written down, but what what's the thesis with that? Is it like diversifying? Was it a way to raise more money because people could have exposure to both? Like what was the thought process behind wanting to include the Bitcoin in a traditional real estate asset?
Yeah.
Well, because it's cool, dude. I mean, it is cool for sure. But does it make sense? Is it an investment? Is it Is it a good investment?
We're going to find out.
You know, been a year and a half.
Afraid to take risks. We've done seven deals. We've done seven deals. I don't think I ever buy a piece of real estate again without having
Bitcoin. Wait. Okay.
Please tell me why. Yeah. You know, the re real estate is real estate. Yeah. Like like we're we're back to the problem. The problem with real estate is there's not there's not a lot of great real
estate.
It's illquid, too. It and it's very illquid. Okay. And it has capex issues. Yep. And you have negative cycles. We're we're we're in a we're in a damn real estate recession right now. Oh, this is a three-year [bleep] non-stop solution.
Traumatic.
I mean, it's worse than a scarm because this ne it just never ends. And there's probably another two years before this is over. So, you know, if I buy a piece of real estate in Los Angeles, great location, I can't own everything there. So, you're going to buy across the street or Camden is or Avalon or Yeah, okay. Your your roof is the same as my roof. Your swimming pool's got the same chlorine or salt in it that I have in mine. Your units are the same size as mine. Your views are the same as mine. Like, like I don't have a competitive. Okay. So, I'm like, "Hey, how can I get this thing to perform better than 12 or 15%." Well, I need time. I need to drop my prep out. I need to buy great real estate. But you could do the same thing.
Yeah.
you just copycat me and we're competing and the the if the real estate market's bad, my values are going to be I'm gonna get banged or if it's good, I get up. But but I'm at the discretion of the marketplace. Well, I started playing with Bitcoin. I'm like, how can I add this to to our real estate? Has no gutters, no roofs, no property taxes, no maintenance, no depreciation, and it's very volatile, which I hate. And it's very liquid, which maybe I like it, maybe I don't. But if I could put the two together, and I and I've been we've been playing with it for four or five years trying to figure out how to do it. And then we figured out how to do it a year and a half ago. And and and we're basically taking um we didn't know this when I
started it, but we basically created a vehicle that that the REITs can't duplicate and you can't duplicate it.
Why the REITs can't?
Because they're
their tax structure. Well, they have to give 90% of their Exactly. Yeah. So, they're a 65y old institution tax structure that says they must distribute 90% of their currency back to their investors. They can never ever hold cash much less Bitcoin on their on a balance sheet. So, I immediately remember I buy from the REITs. That that is my competition. Camden, Avalon, Starwood. You you even said a few minutes ago, well, well, why wouldn't somebody just go buy your asset from from Marie? Well, one, they won't know what asset they're in. Number one. Number two, Blackstone distributes every quarter. I distribute every month. Three, I send depreciation back to our investors. You don't own a piece of paper. You're you own that asset. Okay. Now, I'm not liquid, which I think is a a benefit, not not not a
deficit. Yeah. Uh the REIT the REITs underperform. They're $4 trillion dollars. They're too big or they're too small. The REIT industry is [bleep] completely [bleep] broken. It's broken and there's no fix it. Like like I've been researching this now for four years. Okay. The reed industry, I'm calling you guys out. I'm going to be the biggest disruption to the reed industry. It's like it's like an automobile not changing for six to five years. It's like electrical to gasoline or you know it it's a broken it's broken. Forget the Bitcoin. It's broken because they're distributing all their cash back to their investors. And that means they have no money for capex. They have no real money for expansion. And if you have a good product, do you want you want to buy your shares back? They can't even buy their own shares back. Okay. That's why I think that
the reed industry after 65 years will completely mark. So what do we do? I'm like, okay, where what can I do that they can't do? One, I can move faster. I could buy better assets and I could crowdfund from my audience. My audience, they're not even paying attention to Yeah. They get all their money from the same sources. Yeah.
All these big groups, insurance companies,
they're all getting their money from the same Yeah. the same. And guess what? Those guys aren't participating in the gaming. Music stopped, money stopped. I'm crowdfunding. We're crowdunding more money today than we ever have. I'm raising more money today than we were raising in 2020 when money was [bleep]
free. I mean, it's the best time to buy
it. Yeah. So, so one, I'm adding not only am I buying best-in-class real estate from the institutions, I'm then adding on top of that another $100 million raise. And that's why I say you can't do it. Okay? First of all, they can't do it by law. two, you can't do it because you're having trouble raising money for your asset. Okay? So, I'm raising money for the asset and then raising more money for another asset that says the cash flow,
right? And but so is an investor looking at that the reason that they want to invest in those two different vehicles
is because they get exposure to it. Yeah. Exactly.
Right.
Yeah. You get you you're buying a piece of real estate.
Uhhuh.
I mean, this is there's a lot of complexity. Sure. From from a marketing standpoint, well, that you're buying a real asset that you can see and you're getting exposure to this invisible asset that you're that you're slightly interested in because it feels like to me marketing a 1,00 right? A 1,000% marketing that is going to over that that the product's actually going to overd deliver on the marketing. Interesting. So, to me, the market that it's marketing is not bad. See, the problem with the Bitcoin community is they're terrible marketers. They're the worst marketers that have ever walked on the planet except for the Democratic Party. So, Bitcoin people like, "Oh my god, like Bitcoin is the solution to everything. Bitcoin, you have to get rid of your money. Oh, get rid of fiat. The money's being destroyed." Blah, blah, blah. Nobody wants to hear that [bleep] Okay?
I'm not pitching Bitcoin. I'm pitching real assets. a great building. Uh 101 Meister, Boca Raton, Maine and Maine. Perfect. 366 units. We bought it below replacement cost. We stole the asset for 100 million less.
We need to talk about replacement costs. I don't agree with you on that.
Okay, good. Yeah, that's fine. Yeah. Uh we we bought it for 100 million. That deal was probably bought for 150 million below u cost rather than just stealing the asset. This is what Ken would do. Kim would be like, I got a good deal. A good deal is a good deal. But dude, what I'm doing is I'm taking my good deal and rather than taking an invisible discount, I'm taking that discount and I'm adding an asset on it that has a potential to 10 times 10x. Discounts don't 10x.
Yeah.
Bitcoin on top of it. Okay. So when I take the asset and then I stack another asset, like what if I could get 10 more floors of asset and not spend any money on property taxes or gutters or roofs or paint or tenants. So now I have the two things combined. They're they're merged into one LLC. Okay? And you and I, let's say you and I split the deal, we are 50/50 in the real estate and in the Bitcoin. Okay? Now, if the Bitcoin goes to zero, we're both [bleep] Yep. It was like, "Oh, that was a terrible idea." But my real estate should carry me back to replacement costs, which means we basically just wash out.
Okay.
But you have And I got cash flow while I waited.
Yeah. You have You have a prep on that one though, right?
Yeah. We put a prep on That's how confident I am in I went from a zero prep to an eight. I'm paying a zero. Yeah. Listen to this. You You understand? Yeah. I'm paying a zero and getting 20%. On the upside. Yep. And I say I'm so confident I'm going to add an eight prep, but I'm going to go to a 50/50
split. Cuz that was a So, just for math, cuz I I'm
10 years.
I owe you 80% on your money.
Yep. I owe you your money plus 80%.
Y let's say I didn't pay Let's say I didn't pay anything for 10 years.
Yeah. I owe you 80%. So, I owe you 100 million plus 80 million before I get anything.
That's how confident I am.
Plus the Bitcoin though cuz is is No, no, I get 50% of the upside of the Bitcoin. But is it the same pref on the Bitcoin? It's eight. It's eight on the whole race.
But so it was a $300 million building.
Yes. It was 66% equity effectively has 100 million Bitcoin million dollar. That's right. Right. That's right. When you raise my ow 8 points on 200 million. So in 10 years I owe uh 16 million times 10. I owe 160 million. I owe 200 million.
Yep.
Plus, I owe the investors 160. Yep. And I still think I think I'll make on that deal. The investors are going to probably be at 24% a year and I'm going to make
60.
That is ambitious.
I have 10 years, man. Yeah.
No, I know for sure. So, if I if I have This is the problem with the real estate industry. This is the problem with every re every syndicator on planet Earth. Yeah. The guys you sell real estate to. I got to return the money in three years. I got to return in 5 years because they're [bleep] You You guys that raise money, you're [bleep] You go to your doctors and your lawyer friends and your chiropractors. These guys are laughing. You're [bleep] [bleep] And you're like, "What do I got to give you?
What I What do you need?
Okay, I'll give you this. This is stupid." And then what you do is you buy value ad. Yeah. You you push down the food stream. Yeah. You're buying a a a poor product so that you can hit hopefully hit that six or eight prep.
Yeah.
And I'm like, "No, I'm buying best-in-class real estate." Like, if we didn't do that Bokeh deal with with the Bitcoin, okay, if we didn't do the Bitcoin, we would have done this. Hey guys, it's a uh it's an 8020 over zero. Okay, that deal is going to pay 4% a year and I'm going to get one point of the four and you're going to make 3% and I would raise all the money for the deer. People would pay why these put in treasuries? Uh because my upside on that real estate is is unbelievable. You think the upside because you bought so because I I bought a deal that I that I believe back of your you want to go talk about I believe first of all I know that asset I know that asset can sell for uh $450 million as condos and I pay
2%. So that's see that that's an that's an out. So that's the thing that I see really smart people do is they have an A and a C plan for the asset. You get you need multiple ramps. So you have to that like what if this ramp is closed. So kind of mapping. Okay, that makes sense to me. That that is a that is
and you see when you're selling the value ad the $2 million deal, you only have one exit. Dude, your your one exit is cuz your exit is not to refinance cuz it's a piece of [bleep] prior. You're like, "Fuck, I don't want this thing for another 10 years." Yeah. You didn't even really want it for the first 10. You only bought it cuz it was
cheap.
For sure.
Yeah. Because like So I'll give you an example. below replacement cost. This is why I disagree with replacement cost because um in in Los Angeles there's these um older buildings, right? And they're $110,000 a unit. Yeah.
$110,000 a unit. Yeah. It it the permits would be $10,000. It's
permits wouldn't even make any sense, right? And so even if those buildings are a 7 and a half GRM and a 7% cap rate, it's 55% expense ratio.
Yeah.
Crazy, right?
Really tough.
And then the city of LA says, "Hey, by the way, you could have raised the rent 2% more because it's a master meter building because the landlord's paying for the utilities, but we're going to take that away. So, you can only raise the rent 3%." Yeah. Annually at max. Actually, 90% of CPI, which is 2.9%. You're losing money owning that building, way below replacement cost. The only way you make money is if the interest
rates come down, right, and cap rate compression actually happens. Yeah. That's the only way that you make money on that. Even if you buy it below replacement costs, for example, even new construction in downtown Los
Angeles. Bro, bro, did you did you come to Miami? I did to do this podcast. Yeah. Then why would you not go to where the [bleep] good [bleep]
is? See, if you were a fisherman, okay, there there was years where
where the fish were biting in California. Yeah. And it was a great real estate market. I mean, you don't stay in LA. At least go to [bleep] Orange County. Like you got to move where the fish are are at. You know, if you go out in the Atlantic and you go fishing today, okay, first thing you're going to do is you're going to go wherever the other [bleep] boats are. Like you don't need a GPS program to figure out where the [bleep] fish are. Just follow the other boats. It's a location game. You know, there there is no US housing market that everything is very centric to a location. LA was a great real estate market. I never bought in the market. Yeah. Because I couldn't make sense of it. But I could buy in San Diego. I could make sense of it. I understood the San Diego market.
Orange County, I understood it. Okay. I knew the politics in LA. I lived in LA for uh 14 years. Never bought a piece of real estate there because of all the
overregulation.
Yeah. What What do you think?
Uh can I want to speak California?
And so that's that's where you're you're dismissing the value ad issue. Yeah. But you the value ad is not the I mean the replacement cost thing is not the issue in California. is the regulation for sure.
I have a bunch of communists. Yeah, it be for 100%. Same thing in New York City. Yeah, 100%.
I want to I want to hit eviction.
You can't evict anybody there. No. Okay.
9 months. Nine months, dude. 9 months of no rent. So, let's say the rent was 2 grand. That means 2,000 times 9 month 18,000 per unit. You had 10 units, 180 grand. You're out.
And you're still going to lose a court. Plus 50 grand for the attorneys.
Yeah.
If you win, you get nothing.
Yeah.
and the tenant gets to stay and and he can't even see the next landlord. They're not even allowing you to go and see if someone's been evicted or if they have a criminal record or any of this [bleep] It's
crazy. You don't own the real estate. Okay. So, so and this goes back to the value ad thing. All the value ad stuff is junk. First of all, it's too small. If it was built in the 70s, it's under 20 units. Yeah. If it was built in the 80s, it's probably under 40 units. Like these things were built in stages and sizes, right? So, uh if it was built in 2000, it's probably 250 units. I mean, that's where you people should be looking. They should be looking at that 250 unit. The best deals in the marketplace are the bigger deals, better locations, institutional quality, uh where these guys have to take out sheets of paper and say, "Take the
take the top 12 lines." Okay. So, I want to I'm going to go back to California, but I want to talk about this deal. Um because this is the one that I studied and understood. So you bought it at like 700 a door. 66 675 700 a door.
Yeah.
It was like a 4.9% cap rate. You're leasing it up.
So there's a little bit of value added.
We were 85% occupied. Okay. So you're increasing the NOI.
I mean the occupancy which is we take it we take the NOI up from 99.5 million to 113 in 9
million. Okay. All right.
Fair. But I am I have a hard time. And the big one is down by the way.
Yeah.
a little I've I've lost about 20 million on the Bitcoin. Okay. But you
and down 20 million on $1,100 NOI increase. You probably made it back in the NO.
So notice this. Yeah. The real estate value crossed the Bitcoin. Yeah. The Bitcoin was supposed to go up. It didn't. It didn't. But we're we're long-term holders in the Bitcoin.
Would I have rather bought at 72 than 92?
Yeah, of course.
But we didn't.
It is what it is. We bought the Bitcoin real estate. We bought the Bitcoin infused them together. They're going to ride together. we're going to die together or we're going to live together. So, at some point that Bitcoin should do what the real estate cannot do. Yeah. But the goal back to the exit, I'm sorry to interrupt. The goal here is to fuse these two together, marry them for 10 years and I have,00 Bitcoin. I have one I have three Bitcoin for every unit in the building. Okay. My rents are going to raise in Bokeh. They're not coming down, dude. My rents are 4,500 today. They'll be 13,000 bucks one day. So over the next 10 or 15 years, my rents will triple. I don't know what my Bitcoin does. Yeah. But I have more Bitcoin per unit than I have units. I have three Bitcoin for every unit.
So Bitcoin goes to Yeah. a half a million. And I still own my real estate. But that's not the exit. The basis that's gots me.
The basis thing gets me. So, oh, you think my basis in the bokeh is too high? So, I I looked I I'm a big basis guy. Like basis to me, I don't want to be the guy selling at the highest price per unit that's ever sold in the market. Why not the business? Because then you got to produce trophies though.
Trophies are always trophies, man. It's the great who?
But when you can go buy a building, let's say, okay, fine.
If you would just run If you would run the last 30 years and just go look at what always gets a trophy price. If all an investor did, Warren Buffett talks about, "Yeah, man, you're gonna have 20 trades in your life, only 20, then go pick trophies." Uh, I bought a house in LA in 200 two. It hit, when I was looking at the house, I'm like, how many times is this house traded? Three times. It was the highest price all three times that it sold. What does that tell?
It's good.
The next time it's going to be the highest price. Yeah. So, it's just telling me, dude, this thing keeps acquiring a higher price. Remember, real estate's not like a company. Yeah. Or a woman. The woman ages out, she becomes less valuable. The men age out, they become less valuable. The company actually ages out, becomes less valuable because it gets teched out. Mhm. The real estate if it's in a great location, fantastic location, it's going to
price up again. Fantastic. That is that is a that is a caveat. Fantastic locations. Cuz if you're buying it at 700 a door, right? It's the exit of that condo. Fine. Fair. I will take that. But let's let's take the condos out of it if that that isn't a situation.
Yeah.
You're buying it at 700. For you to hit your two and a two and a halfx multiple, you got to sell for a million and a half a door.
No doubt. No, I I got equity on.
What do you I got deer, but you're 70 You're 70% LTV or uh 30%.
Right. No, on the real estate.
On the real estate, I'm uh But that fund is the Bitcoin. On the real estate, I'm 50% leverage.
Okay. So, you're 50% leverage. Yeah. So, all I need is a double.
Okay. But then over 10 years, the IR how you going to hit 15%. you're going for for 10 to 12% IR which means you're still going to have to I mean over 10 years it's going to have to double in
prime well I I told you I think I think my rents in there will be $13,000 in the next in the next 10 to 12 years. So they're taking they would be they would be $13,000 in in LA right now. If it was in Wilshshire if I took my BOA deal and dropped it on Wilshshire Avenue the [bleep] rents are 15 grand today. If I moved my [bleep] building over to New York City the rents are [bleep] $25,000. Yeah. And you don't get to see the ocean, bro. And you don't get to see a golf course. And you don't, you know, like Yeah. You're just underestimating the future. You're 30 years old. You don't You are underestimating rent growth. Now, you can't get rent growth where you go, where where you live at. You will You're going to have explosions of growth.
What you're going to have is big metro cities pop up. Santa Monica is going to become 5,000 units.
Yeah. They're already under construction.
and they have another 4,000 units that are so so it's going to it's going to suck all that money out of LA. All that money is going to move south to Orange County or to Santa Monica. It's going to move across the road and it'll drop down into that micro city and this is going to be decapitated for 15 years and then somebody some new mayor is going to come in and say, "Let's fix [bleep] LA and LA I'm a super city
again." Yeah. It I look I want to believe it because I've just seen I'm selling a building right now. It sold in 2006 for $7.2 million. Yeah. I'm going to sell it for less than that today.
Yeah.
2006. What year is it?
1920s. Okay. 1920. It's 100 years old. Yes.
Yeah. Right. But like that is crazy to me as someone who's like, "Holy [bleep] you got to put your whole life savings into a building.
20 years real estate just deal. First deal I ever bought. The guy bought paid 5 million to build it and I paid 1.9 million to buy it. That's replacement cost. I don't know why you're against that. Well, because replacement cost doesn't mean the value of the building though. It means it means in that case it nobody would nobody first of all the replacement cost is a bit of a misnomer there because LA won't even let you replace it.
It's fair.
So yeah, but like but replacement cost is a number.
What the value of the building is whatever someone decides what the value is.
So just like what the what the value is today. Yeah. He said if I don't have to sell today, I don't I don't need to be concerned about the value. True. That guy needs to sell otherwise he wouldn't be.
That's fair. That's fair.
But he's he's got a loan due. Yeah. Right. Yeah. Or he's going to lose it. Yeah.
He's going to lose it.
Cash Yeah. He's going to be cash in. Exactly. Yeah. There's there's motivation there. Yeah. He's got a loan that's due. So, anybody out there watching right now, you're looking for any loan that was made three years, five years, or seven years ago, if you're shopping in institution like I do, like the big insurance companies, they're not selling
their stuff that they bought 5 years ago. They just go deeper in their book and they're like, "Okay, we can't sell anything that we bought in 2021
because you'll lose 20 30%."
So, what we'll do is we'll just go deeper in our book. Got it. Because they don't want an embarrassment. Yeah. of, oh, we lost 30% of our money. So, they just go deeper in their book and they're like, oh, we'll go back 10 years and I'm going to pay what they paid 10 years ago. So, they Yeah. And that's your situation with this guy. Yeah. You somebody's going to come in and buy what it was worth. Yeah.
Maybe the time it traded before this.
I think LA is the best time to buy in Los Angeles. I'll tell you terrible time. The the values from 2006, right? you. How you going to do that?
That's not going to happen again. No, maybe not. 10 GRM. Yeah.
Seven caps. Yeah. I'm selling seven and eight caps. Yeah. It's crazy. Crazy in Los Angeles.
Crazy. 96% occup.
But if you can't collect a rent, bro, it's not a sight of gas.
That's true.
No, it's you you could you could end up with a 12 cap on your legal fees. The lawyers are going to make all the money over there. It's a litigous place, bro. It's just it's terrible. It's like, let me ask you something in terms of Atlanta, parts of Atlanta. Same thing.
They just gained the [bleep] out of it. Yeah, we have a sponsor for today's episode and that is AI for Siri Collective. 25 listings at the moment. We're closing four or five deals a month. It's been incredible. So, if you want to learn, if you're in commercial real estate, how to use AI in your business, whether you're a property manager, a broker, an investor, really anyone, we have a huge group over 400 people in this community. And the website if you want to go check it out is AI forcollective.com. So appreciate you guys. Now back to the episode. Let me ask you about um this the market in general, the whole market.
Yeah.
Right. Given where we're at, AI's about 90% of the stock market growth is coming from AI. Yeah. We're I would say we're in a a bubble. It feels like we're in a bubble, right? Do you think that we're going to be continuing to bubble? Do you think they're going to keep printing money? like what happens to this market? Are we headed for a recession? What is your opinion on the market?
Well, we're definitely in a real estate recession and it makes no headlines. Yeah. But we're definitely in a real estate recession. That's caused by Jerome Powell. The rates. Yeah. Rates. Rates. Rates are the only problem, you know. And we don't have enough housing, right? So So we don't have enough desirable housing. Mhm. It's not that we don't have enough housing. There's plenty of housing in LA. It's just not desirable housing. Yeah. You mean in terms of wanting to live there or because look look, do I want to live in a part of LA where it's $5 million and you're going to hit me with another 2% tax bill? No. So, I'm going to go to Malibu or I'm going to go to Santa Monica under the same.
Yeah.
GS. Or [bleep] it. I'll go to Orange County. Yeah.
Doesn't exist there. 5% actually. What? It's a 5% transfer tax in Orange County. No, no, in in LA.
So, I just moved to Orange County. Yeah. Okay. So, like money moves, man. Like, the fact that you're still there is crazy. You should just move, bro. Just move where the opportunities are.
I'm just giving you a piece of No, no.
I I'm giving you I'm giving you a billion dollars of advice. The best things that have ever happened to me in my life. The best. A move came first. Every single time. You didn't feel like you had to give up your I left California. I left California to buy a thousand units in Florida 2012.
How did you learn the market?
I sold my house 1401 Oral in Dhini. Uhhuh. On Dohini Boulevard. Great area. Okay. Leonardo DiCaprio was my neighbor. Dre was in front of me. Keano Ree was six houses down. Like it's [bleep] perfect. I sold it. Took the equity to buy a thousand units in Florida. That thousand units made me uh put $15 million down and made us a couple hundred million dollars. If you were in your 20s right now, I would do with Jesus to zero. Leave Bethlehem. [bleep] leave.
You had zero dollars though.
I think he left Beth. Where did he leave? Where did he he went from where to where?
I don't even I don't even know.
He He left Nazareth.
Where?
Okay. See, but you you you think N stay go where the migration's going.
Look at migration patterns. You're tw You're in your 20s. You're young today. You got zero dollars. Nothing.
I'm 30.
I'm 30 and I Yeah, exactly.
You're 30. Yeah.
What do you do? Where do you go? What What is your PL? Well, do I have a job?
You're a salesman. Okay.
Get great.
You did great.
Are you a salesman? 1099. You're 1099.
You get great. Get fantastic at it. Make sure you're selling a product where you can make a lot of money, you know?
Can you?
Yeah. This guy you're talking about. Yeah. Yeah.
Like how much is a lot of money? He let's say he can make a million dollars a year. Okay. In sales.
I thought you said it's a lot of money. He for for
So he's making he's making a million dollars a year.
Yeah.
Let's just say that, right? He's making a million dollars a year.
He's He's I I would take the million dollars. I would invest one I would invest at least $400,000 of the million dollars every year. Okay.
I would be broke in what? 400,000 in what?
I would probably buy real estate.
What kind of real estate?
I would buy multif family real estate that I could depreciate because I want my 400 grand back from the federal government. Okay. So, if you're making a million dollars a year, your biggest taxes, your biggest your biggest expense is taxes. So, I'm going to take the million dollars. I'm going to live on 600 grand of it. I'm going to take the 600 grand every year and I'm going to buy two and a half million dollars worth of real
estate. Okay. By yourself or with partners?
Either. Either I still get the same write off. I'd probably do it with partners knowing what I know.
So, you'd go try to raise.
So, I'd take 600 of my own money. I would be broke though. I'm not going to have a nice car. I'm not going to have nice clothes.
I'm going to rent.
Okay. I'm not going to own a house, okay? And I'm going to take 600 grand. Every time I get money, I'm going to park it in a deal. I'm going to go illquid over and over again. I'll be broke all the time. By the way, it'll make you a better sales.
Why?
Because you're [bleep] broke. So, you're hungry constantly. You're like, you know, you find food when you're hungry.
Yeah.
You eat that.
You know, when you're full, you're like, I, you know, you waste food. So, you're putting in multi family.
putting in multif family and every March or April I get my damn 400 grand back. So I'm basically robbing the IRS.
Are you buying new construction? Are you buying value at
I would buy Well, it depends. I mean I I'm buying it. That's not the bit the I would buy value at, but I would buy a brand new. What I'm going to do is buy a whole neighborhood. I'm not going to buy pieces of Barts of the city. I'm going to I'm going to concentrate my investments. I'm going to be
monopoly.
I'm gonna be 10x Monopoly, bro. I want Park Place and Boardwalk. And I want to own Park Place so that every time you [bleep] come around, you got to pay me. Yeah. Okay. And if I can only get Boardwalk, I'm going to hold on to Boardwalk until I could till I could stuff out this guy at Parkplace that wants it. I'll sell it if he'll overpay me. And then I'll buy a boat back later. And I'm going to keep I'm going to keep concentrating in a market. So, if I can't get the blue, then I'm going to go to the green part of the board, and I'm buying everything on the green part and the railroad. So, every time you come around, bro, I get paid. I want heavy concentration on one part of that map.
And I want I want that street to be a great the best street in that damn town. And if I have to overpay to get it, I will.
What markets are you going looking? Which ones do you like?
Uh, I love I mean, I love where you're at right now. Really? When's the last time you've seen cranes?
Last time.
You've been driving, you've been driving two years of goddamn what's happening.
A lot of cranes.
Okay, that that's problematic, by the way.
Um, they no supply in in LA. That's the one thing that we got.
You're good. You're good. You have no supply, but you have an unfriendly government.
It's true. But even Orange County, I'd say, is friendly.
But are you going so I go to Orange County? If I if I lived over there, I would invest in Orange County and I'd buy best-in-class real estate, best locations, Starbucks, Star, a Whole Foods, Trader Joe's, anything concentrated, high high walk scores. Um, you know, I mean, you're not going to own a home there. Yeah, it's a great real estate market. Don't, don't get me wrong. LA, I wouldn't touch LA. Orange County, yeah, I'd load up. Parts of San Diego, load up. uh you know if this if Spencer uh uh gets gets uh elected which I think he will I think some things are going to start shifting over there.
What structure would you have for your LPGPS?
Well, let me just finish some other cities. Okay. Uh Dallas, Texas is going to be a super bum city. It's going to be super super bump. North Dallas. North Dallas 100% between the 11 and 1:00 on the clock. Anything in that north carter is going to just scream. Uh Austin, Texas, I wouldn't I probably wouldn't do it there with tremendous amounts of supply. Yeah. So, you're going to have three years of getting rid of that supply, but but come 2030, it'll be a screamer market. Okay. Uh San Antonio wouldn't touch it. Houston's got less supply coming on, but you got to be very very careful because that place just gets bigger and bigger and bigger anywhere you want, anytime you want, and every 10 years they build a new suburb. So, you got to be careful there. Um, Miami, Fort Lauderdale,
Palm Beach, bro, this is going to become New York City, New Jersey. This is just going to keep going. The the Gulf of America, Dest, everything from South Mobile, Alabama to to uh Panama, that whole strip is on sale. Panama City. You could steal down there. Everything from South Tampa all the way down to Naples, you can just rape and
pillillage.
Yeah. Too much supply. You can buy, you could steal stuff over there. But if you can hang out, you're going to be good on that on that coast. Um,
how are you structuring these deals? Okay, how do I structure them uh with the LP?
Yeah, you're you're new, right? You're raising money. You got a million bucks if you want to, dude.
I'd just take a piece of paper out of your book and I wouldn't I wouldn't go to I wouldn't even use a lawyer for that. I'd go to Grock and say, "Hey, create me a one-page document between me, a subscription
between me and 10 investors." But how would you structure it 10 years, right? Like the reason I'm asking is because
traditionally, I you I depends on whether you're a [bleep] or not. If you're a [bleep] then then go ask the dentist what he wants. But if you're me, you know, you're going to be like, "Here's the terms. Do you want to do it or not?" because I'mma buy it with or without you. See, my horsepower is I'm doing the deal no matter if you come in or not. And then I go to my big audience. It's kind It's hard.
It's hard to replace that. Would you try to build an audience?
100. Yeah. 1,000.
So social. But what I would do is I would use the asset to build the audience. Tell a story around the asset.
Yeah.
Always.
I I never talk about me. Yeah. I am right now on this podcast. So you're asking questions. Yeah. I'm always going to go back to the asset. Look at this. Bestin class. That's why I don't want to buy the junk, dude. Because the junk has less of a story. And I don't want to buy stuff he could buy by himself ever. I want to buy stuff that nobody could buy by themselves. Cuz remember who I want to exit to? I want to choke a whale out, not a minnow. So, I want to take this best-in-class asset and then I'm going to complicate it by adding something on top of it. Like I just complicated the whole world. Okay, I wrote about this in a book called If You're Not First, Your Last. Okay, if you can't compete, find someplace where you can dominate. Even if it's a
tiny D, I I I think I'm going to get five or 10% of the reed industry and this real estate in the next 10 years. Yeah, maybe. Maybe sooner.
It's a lot of money.
If I get 5% of if four trillion four trillion, right? That that that means I have a $200 billion real estate portfolio if I only get 5%. They can't come do this. They can't buy the Bitcoin. They can't combine the two. Yeah. And the syndicators can't raise money for their own deals right now, much less raise money for the deal and a
Bitcoin. And so you're from a 721 upgrade, right? Yeah. Okay. Is that something that you're thinking about in terms of because like 401ks are going to be unlocked or already unlocked which is super interesting.
Yeah.
In terms of the Blackstones, these these big institutional firms, the insurance companies, they are [bleep] there's 14 trillion in these 401ks that went out. That's their new source of retail money.
Yeah.
Right.
Like is that going to be a vehicle where you're trying to about about a third of the money that we've raised comes from 401ks self-directed and you set that up to make it easy for them or they're Yeah. cost 250 bucks. Really? And no tax bill. Interesting.
Yeah, you think differently. You're very you're very creative. Um I'm looking for glitches. No, I like I like When you're hungry, you look for glitches. It's like a It's a blue track.
You know, if you if you're if you're if you look for a Twinkie, you'll find one.
Do you even know where a Twinkie is?
I do. Oh, it's Twink. So, if you look for one, you'll find one. Otherwise, you're never going to see one. But you don't see what you don't look for. Like, I'm looking for glitches. I'm looking for for places where I could go in and and and so value ad was like, "Oh, that's a glitch. I'm going to go do the value ad." And then everybody came to value ad, bid the prices up to where you could people were paying the same cap rate for value ad that they were paying for brand new [bleep] So I'm like, "Blitch, leave it, you know, and leave it." Everybody rushed over there. It didn't work, by the way. Okay. Uh all the institutions about 10 years ago went to micro units. They all decided the institutions all moved. They moved like they move like herds of
fish.
Okay.
I don't like micro units.
No, it was stupid. I'm like this is stupid, dude. They left all the thousand unit. Who Who wants something smaller?
No. If you're in Japan or you know these these market these cities is it's different, but um I want to ask you about uh this one came from my producers back there. Um, if it's about who you become on the journey, would you advise a young person with ambition like your daughters, right, to do the experiences that go to Miami, the go to this in their 20s to go hang out with their friends at Colombia, do the [bleep] in their 20s while they can, or do you think it's grind time? It's grind time, but do the [bleep] in your 30s and 40s?
Oh, yeah. I mean, yeah. I mean, it's it's a no-brainer, dude. It's grind time, dude. So forgo the experience you know deserves right
now. Interesting. When do you deserve to learn how to work when when when do people deserve to go the experiences you on your personal experience your your pants?
I mean I would replay my I would re I would redo my life again. I wouldn't do it the way I did it. But but I would I would not change I wouldn't go to college. I would have gone straight to work.
Okay.
I'd be 17 years. I'd have been 15 years old. If I could redo my whole life. Yeah. I'd have been homeschooled, out of school by 15. I'd have been working when I was 15. I'd have been a professional salesman by the time I was 18 years old. I'd been making I mean, today, dude, I'd been making millions of dollars on the internet. Millions and millions of dollars.
What are you throwing?
I don't care.
As long as as long as I shop, huh?
Tik Tok shop, maybe. Like there's so many there's so many I I if I was 18 years old today I'd be doing AI consulting for companies and making a couple million bucks a year, you know, because I don't want to learn it. Yeah. So I would be doing it for guys like me from a distance and then I'd be parking all that money in real estate and I'd get my passive income to be equal to my earned income as fast as I possibly could. So that if I lose my earned income job, I have passive income. Like I want to get this I want to get to no income as fast as I possibly can and live off the passive. Once I have enough passive income, then I can go do adventures. You should not be doing adventures when you're having to pay for them.
And even if your mom and dad pays for them, you're still paying for them because now they still control you. Yeah. So I want to I want to pay for I want to pay for all my all my freedom in life should be paid for from passive income. I don't mean a multi-level marketing company where you're having to go continue to recruit for your team. I'm talking about when you could step away and the income's still going to go up. Real estate
and real estate, dude. Who's the best salesman you've ever met? And is it Jordan Belffor? No, it's definitely Jordan. I mean, you know, if you believe in criminals and snitches, who's the best salesman you ever met? Best salesperson I've ever met?
Uh, I mean, it's got to be it's got to be either Elon, Donald Trump, or Warren both. One of those three.
Why?
Warren's probably the best cuz he's the most disguised. He's complete.
He's grandpa Warren.
Yeah, dude.
What do you think?
Beast. Okay. Elon fantastic. Elon's probably the greatest salesman in sub. Break it down for me. I want He's a marketer.
You think about it.
He's not an engineer first. He's a marketer first. Trump's probably the of the three because he's so obvious,
you know. So So what makes a good salesperson is an unobvious
market. Like like I'm not a great I'm a great salesperson, but I'm not I'm not the ninja level because the ninja level you disappear. You're invisible. You're you're you're not Rambo.
I'm Rambo in the sales. Your your charisma and your confidence.
It's obvious I'm the sales dude. I'm a fast talker. I over talk people. I cut you off like you know I come off as like I know better blah blah blah I know those are all deficits right but like Warren Warren is like this [bleep] you you you just got cut and you're like what the you blood's coming down your goddamn chest and you're like I don't even know who did this ninja level [bleep] it's ninja but I think part of it is the return the prior but isn't it the results because then you once you get results then you can lean on that and then it sells it for itself Cuz not really nothing really sells us per self. Nothing. No.
No. You don't believe that?
No. Uh good works do not go good works go left unknown unless you advertise it.
If you wanted if someone wanted to be a ninja.
Yeah. Become a ninja. You got to study man. You got to study these guys, you know. Study watch everything they do. Like become them for a second.
The psychology of it.
Study them. Watch every interview. If you if I wanted to become more like Warren Buffett, I would have to study thousands of hours of him and break it down. I watch everything I was doing in every interview. Don't don't just watch him and then go watch Bill Aman and then go watch Elon and then go go watch this podcast. You you got to study. You got to go deep on a guy until you start picking up the rhythm and the vibration of that individual. and start to start to feel it. Fill him be that person like almost become drop into that role.
Yeah.
I mean it's [bleep] But nobody wants to study that much, dude. No, it's a lot. They people want to watch. They don't want to study. Well, because it's a hard work is hard work. See, like people are going to watch this today. You you have you have a knack. I don't know if you know you have this, but you you look for similarities rather than differences. Yeah. Most people look for differences. like half your audience is going to look for what they don't agree with here and they're going to take sides and they're going to be like he's wrong about that. You're looking at differences. You should be looking for similarities. Yeah. You should be looking for how can I use what Grant said 100%. Not like
I study Warren Buffett. I probably done 3,000 hours on Warren and I'm not a stock industri. But I always looked at Warren and said, "How can I apply to what he's doing to real
estate?" What are the things that you picked up from him?
Don't have a gun to your head. Okay. Which means drop the drop the fra and drop the timeline. That's where that came from. Interesting. That's I mean that's where it came from. I went to I paid to go to uh a meeting with him in
um You met You met with him?
Yeah. Yeah.
What was that?
One, one of the pieces of advice was don't take money if you have a gun to your ad. Drop the prep. Drop the timer. 10 and 10. Guess guess what the Guess what Blackstone's offer now? Hey, we don't want short-term money anymore. See, once somebody once somebody breaks the system Exactly, dude. You start disrupting the system like I did when in autos. So So, you know, you just got to look for look for similarities. I'm hard to watch because if you don't like my style, then you're going to be immediately like, nah. But you really should look for Yeah. But how what what's the best parts of this can you take away? Yeah. I mean, I've only done I've raised more money than any other human being on planet Earth. So, it's like I've raised $2 billion my way.
Yeah.
Without ad budget.
We We literally don't have an ad budget through socials.
Through social media. That's crazy. on my terms.
By the way, I I've raised the cheapest money on the planet. That's what I'm saying. So, this is the way that I look about it. Cuz young guys come to me and they're talking about doing deals and I'm like, "Okay, here's how I'm looking at it. Here's where the opportunities are, yada yada yada." And they're like, "Okay, well, I got my family and friends who want to give me this amount of money and my family and friends who want to give." I'm like, "Dude, the only thing that matters if you're getting money from people is what they're expecting from that money. If they're going to say you have to pay you back in 20 [bleep] years and you got to give me a 3% return, then you can go buy whatever you want. It's the cost of capital really is going to determine where you invest into, right?
And so it's Yeah, I wouldn't do I wouldn't do it personally.
I wouldn't do it like that. I would I would I would reverse flip the model. But okay, what do you mean? I would buy better asset. Okay. I would buy an asset that they can't buy by themselves. Okay. You want leverage over your investor. Okay. If you don't have leverage, you don't have any real value ad. Right? So, look, the whole gig starts it does the terms of the deal are predicated on the asset itself. The asset is senior. Okay? The the the what I promise on the money is not the issue. The money doesn't do anything on its own. It it it does something because the asset bill. So, I would focus more on the asset. Good assets will always get money. Yeah. Great assets will just get money faster. But the backend structure is going to matter about how much money you make. Well, yeah, certainly, right?
But start with the asset cuz I don't think people that get the same terms that you get from your investors.
Yeah, I know.
But dude, we're dating.
Yeah. Okay. We're dating, right? And I'm going to go to a club and I want to go home with somebody. Yep. You know, based on your structure, you would just go straight for the prostitute because your your terms you you're it's a transaction. But but I'm like, "No, dude. I want the I want the highest quality chick in the room." Okay. And then the terms, is that dinner?
Is it vacation? Is it whatever? Like, you understand?
Like when real estate people in real estate, they got it backwards. They they they do the money first and then they go figure out what they can buy with the money. And and you don't want to do it like that. It's like you're going to Target with a budget. You want to buy the find the best piece of real estate you could possibly buy with the least amount of competition, but some competition because no competition means nobody else wants it. Yeah. So, I do want some. So, I want the best piece of real estate and and then have the confidence that I could like if I was 30 years old today doing my first deal, I would do the biggest [bleep] deal I could. I would go as big as I could possibly go
and just say, "Fuck it."
No, I would. And I would raise the money for you. Yeah. The hardest part of that is getting you the broker convinced that I can take the beast down.
For sure.
100%. That's the biggest problem. Yeah.
But I can call as a broker.
Dude, when I bought that deal from Blackstone or from Blackstone was the debt. I didn't buy it from them. I took it out of bankruptcy. Yeah. It was $235 million. I did not have $235 million. Okay.
Yeah.
I convinced the bankruptcy courts that I could take the deal
then. And you had to then go sprint to go raise that
money.
Yes. What does that look like?
But but but the better asset. The better asset. No, no, no, no. I get on I go on social and say, "Hey, look what I'm doing. Look what I'm about to do. I'm taking this down with or without you." Okay. And then right now I'm running to figure out how do I pull in my own assets right now in order to do this deal. Like that deal I bought in 2012. I sold my house to buy that asset. I I'm not going to friends and family first. I went to Hey man, what what do I have to give up? Oh, you need to move. You need to sell your house. You need to take credit out on your businesses. You need to sell your cars. You need to sell your furniture. Bro, I sold everything. Everything. Okay.
We moved my family of two babies to Florida, which I swore I would never live in this this [bleep] bugridden swamp. Okay? I left I left Leo DiCaprio was my neighbor to move to what? Florida. Come on, man. This was 14 years ago. Nobody was moving here. You understand? I do. I had $12 million. I needed another three. And then I started raising money from friends, took it out of my business, robbed a credit card, blah blah blah to piece together the 15 million. And then I bought that deal. I bought those 1,100 units. But but you know, you're you people are trying to do the next thing without giving up the things they have. And you got to be willing to give everything up, including maybe move it. And then I moved all the way across the country, rented, sold a 12,000 foot house that had
views of downtown LA to to Malibu. Sold that to live in a 2,000T condo that I was paying rent sacrifice. Pay the price because that's what it had to be. But you know, that thing that thing got us started. Um, I mean, all you need is one deal and then Yeah, because deals beget deals. Yeah. As long as one deal can change your life. That deal pays me. That deal I've refinanced that deal three times and putting $15 million down. I've taken $108 million out of that deal and I still own it and it pays me probably 400 grand a
month. That feels good, huh?
Pays my sister, my brother that funded it. They made they made tens of millions of dollars on that deer. So, we still own it today. We own it, you know, 13. All you need is one great deal. Now, if that was if I would have done a little deal, I could have done this. We're going to keep the house and I'm only going to buy one of those properties. Yeah. And I would have taken a bite-size, baby step, and I'd still have my house in LA and I'd have, you know, I'd have made I'd still would have made money.
Yeah.
Wouldn't have been the scale and level. You need scale. You need scale. The most important number in real estate, do you know what it is? Doors, number of units that you the
the the management too rate. You were talking about Ken about this and the one thing you were saying is why don't you use third party management? I think the management side of the business is actually super undervalued in terms of the actual value that you create from it and the enterprise value. Property management is one of the only businesses in real estate besides the rents, I guess you'd say, but it can fluctuate where doesn't matter where the the value of the property is.
Yeah, you're still going to get you're still getting your money.
Yeah, that is a sexy ass business in real estate. There's not many.
I know. It's tough.
It's hard as hell, but that is recurring revenue. Why is private equity going and snapping up all these property management companies? Yeah, like your property management company. Do you third party or sorry? Okay, you third party. I bet you if you took that in-house, it would be worth more than a [bleep] ton of your real estate. There's so much value in that recurring revenue, which I think is
super interesting as a broker who doesn't have I can't wait till you see this and watch what I'm about to do next.
But oh, you're doing something
later.
When is this coming out? When is the news? Oh, uh, when am I going to when am I going to hear about it?
We're just we're just in it right now. So, I don't know. Couple months. Okay. Yeah.
All right.
I'm excited to see.
But like that's what I'm I'm thinking about this stuff and AI consulting and AI is going to is going to freaking change the world. AI is going to going to change real estate. I think that this is my personal opinion that in 10 years, maybe even less, they'll be me and maybe I have a staff of like two or three. We'll own multi multiple billion dollars of real estate with like six people. Yeah, I genuinely believe that with the tools and the the infrastructure, what you can do, all this stuff.
And if I have a social following social media, yeah, but what's AI going to do with the how's AI going to raise the
money? I mean, it's already communicating better than
humans. You don't think it's going to get better at doing? Dude, I asked Siri to call my wife yesterday and Siri couldn't find my wife's number in my damp. So, we're so early though. This is 1997. You're right.
You're right. and and you know like me the metaverse and we still haven't gotten
it. That's true.
That's true. But I think I mean it's just the money the money in AI is you know ridiculous. I know a pitch when I see one. It's ridiculous. The pitch is on.
Are you only multi I want to actually talk about real estate assets.
We own two office buildings. We own and Scottsdale, right? We own one in Scottsdale. Yeah. Half a million or 250,000 square feet. We own this building.
Yep. Would you go into any other assets?
Yeah. Sure.
Why? Why would I?
Yeah.
Why?
I mean, cuz I would own a whole neighborhood. I would own the hotels in it. The retail? I would own Yeah.
I would own retail. Is that Is that in the future for you? Yeah. Right. Yeah. Cuz I I look at multif family in Los Angeles. I'm like, this [bleep] sucks. Yeah. But I would love to buy a small bay industrial building where I know that it's just it's the tenants. It's [bleep] you don't pay, get out, right?
Like that to me is Yeah. I enjoy that.
Yeah, I like that.
10-year terms.
I know what I'm going to get paid.
Yeah, you can make money. They're paying $150. You're going to get them to $1.75.
I just My network is so How do you leave a network like that, man? I did. My leverage is so strong. Like you're talking about money, right? The people that I've sat down with. Yeah. Over 500,000 units that I've had a conversation with. Yeah.
A good deal.
I can pick up the phone and say, "Hey, where's the money?"
like that.
Those guys only own it all. No, there's some that own out of state for sure. But a lot of them, they want to feel it.
They want to touch it.
They want to see it.
Right.
You own in Florida.
You live in Florida.
We own in seven other states. Okay. But but also, you probably fly to the real estate. You see it, you feel it, you touch it. How do I know that this side of the street is good and this side of the street is shitty? In LA, I could be walking one block north and it's a completely different experience. Yeah. as a realtor. I know because the people who come and buy my deal, like if he if he came and tried to buy a deal for me, right? I know it's a shitty deal. I know it's a good deal. I know who's overpaying and who's not. I have a fear that if I'm going to Savannah, Georgia, and I want to understand that market because I think it's going to come up. How do I how do I get to know that this is not the
street, this is not the block, this like things are growing over here? There's this in-depth knowledge that if you don't have the experience to do that, it is very hard to beat someone who is spending their whole time doing that, right?
You know, it it's not hard to get the data though, too. You're making sense of a [bleep] market. You you hear I mean, bro, you you're you're you cannot collect the [bleep] rents where you live. You cannot win litigation. If you win the litigation and it's raining, you can't evict that day. if they claim they're sick or they have the flu or temperature, you cannot [bleep] evict that day. You cannot collect the rent. So, it doesn't matter that you own Parkplace and Boardwalk. If you can't collect the [bleep] rent, you don't own [bleep] So, so you want to move where money is, man. Where's the money going, bro? You know, you you're too you're too you're too locked in. I know. Okay. Mark Mark Zuckerberg did not want to leave Harvard, but he did so he could become a rich [bleep] right?
Elon left California and went to [bleep] Texas to become a trillionaire. Jesus left Nazareth, bro. Godamn. You're like, what are you going to leave? Go where? Go find the flows. Move toward float, you know? Find the flow. Where is money going? And move to it. Like that's where the fish are biting. and and Savannah. Savannah's a great market, by the way. Savannah's going to be you can Savannah's, if you ever visit all these people coming from New York, they're like, I'm going down to we're going to go down to Naples, Florida. And they stop at Savannah. They're like, no, [bleep] this Naples. We're going to live in Savannah.
There's $8 million condo for sale in Savannah, Georgia. And when I saw that, I said, holy [bleep]
No, dude.
How come you have a $100,000 house and an $8 million condo?
It's like out of a picture, but nobody knows about it. See, these are undiscovered markets, right? So yeah, they're all they're all over the country.
You just got to know where they are. You know, this was a this was an incredible conversation. Is there anything else?
But you see, you you won't learn about Savannah unless you go there. So you have some time. You just got to just how how do you know about LA?
How do you know about if you move one block?
Oh, cuz you've been there 30 Anders. But it doesn't take 30 years to do this now that you know what you're looking for.
It's true.
So the knowledge and and and by the way, you can do the research. I mean, your quick hack is just do the research that Whole Foods has done or Starbucks, you know, how long's that Starbucks been there?
What what are their receipts at that score? You know, so uh where's the nearest mall? How's it doing?
This Avatore Mall, third most successful mall in the country. This area that we're in right here, probably this ain't dying. This is just going to get better and better. Now, you can't really say that for Santa Monica malls. They're dying. Okay. But find a Trader Joe's, find the Whole Foods, find the discretionary money, see where jobs are moving into, and then then you're going to be
insulated. The last thing I want to ask you, what do we have to look forward to for Grant Cardone? What are the next 5 10 years?
Look, we're going to build I'm going to build the largest real estate company with the fewest number of units that have ever been built in in like in history, which is crazy. I'll end up with we our goal was to become like as big as uh you know 100 thousand anus put you in the top one or two guys. Yeah. But I don't really need to do that now. I can double the real estate I have right now. Add 25,000 Bitcoin to that and and I could be as big as any of these other companies with half the units. I could be I could be bigger than them with half the units and no property taxes, no capex. Problem with real estate, dude, is the capex and a future property taxes and no insurance by the book. I just got rid of my insurance.
I don't have to insure selfinsured.
I I I I I don't have to buy a homeowner's insurance, mortgage insurance on a goddamn Bitcoin self- insurance. Okay? So, I don't have to put a new roof on. I don't have to paint it. I don't have to gutter it. I don't have to maintain it. I don't have to engineer it. Nothing. So, I I protect myself. Now, if the Bitcoin thing doesn't work out, then then then it was all just a hoax. It didn't work out. But uh that's that's one thing. Second thing is we're stepping into the wealth advisory business. So we're going to become like a small Meil Lynch and take my 20 million followers and start offering them uh other financial vehicles to to to move into. We already know they trust us.
Yeah.
My my investor base has trusted me with a couple billion dollars. They're not going to be disappointed in what we do for them. And the third thing, we're going to take a portion of the company public and possibly tokenize the real estate separately as two different
events. Damn, you left on a [bleep] high note. We got to wrap to do a round two of this when when this stuff comes out. Grant, thank you for coming on. Appreciate you.
Thanks.