October 17, 2025 · 1 hr 12 min
With Mott Smith — Co-founder, Amped Kitchens & LA Small Developer Collective
The episode in one minute
How do you build affordable housing in a city known for red tape, high costs, and endless delays? In this episode of The Group CRE, Taylor Avakian sits down with Mott Smith, co-founder of Amped…
Watch the full episodePublisher notes
How do you build affordable housing in a city known for red tape, high costs, and endless delays? In this episode of The Group CRE, Taylor Avakian sits down with Mott Smith, co-founder of Amped Kitchens and the Los Angeles Small Developer Collective, to discuss how smart policy, modular design, and process innovation can transform housing development in California. You’ll learn: - Why LA’s housing and permit systems are fundamentally broken - How Mott Smith helps small developers build smarter and faster - The impact of modular kitchens, ADUs, and adaptive reuse projects - What cities can learn from entrepreneurs and private sector innovation - How policy reform could unlock LA’s next housing boom Whether you’re a developer, policymaker, or housing advocate, this episode unpacks the complex relationship between regulation, creativity, and real-world solutions. Sponsor: https://aiforcrecollective.com/ 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/ #TheGroupCRE #MottSmith #HousingCrisis #UrbanDevelopment #RealEstatePodcast #TaylorAvakian #AffordableHousing #PolicyReform #UrbanPlanning #CRE
Read the full conversation
This 13,477-word transcript is matched to English (Original) automatic captions. Timestamps seek the episode player to the matching passage.
It was called the mansion tax. They didn't read the 29 pages. Should we tax rich to pay for affordable housing? Yes or no? Well, yes. People are out there lying, saying it's created 10,000 jobs, which is absurd. When Measure ULA took effect, transaction volume in the city of Los Angeles above $5 million where Measure ULA works fell by 50%. Well, they projected would be up to a billion a year.
It's it's averaged about 300ish million. And N you said 900,000.
900,000 is all that's been spent on affordable housing. That has grave impacts to our economy that the people who drafted measure ULA did not fully account for.
What's the early polling?
What I've heard is that this is polling extremely
high. Real quick before we hop into today's episode, I am so excited to share that we have a sponsor for today's episode and that is AI for Siri Collective. This is actually a community that Jake Keller and myself started because we were tired of getting left behind with AI. We're nerds about it. We love to dive into it. Jake is a master at crafting these prompts and I'm very heavily invested in trying to be a better broker and use all of the tech and tools that I can to make myself just that much better. And I will tell you this since starting this community and exploring the workflows and the things how to use AI effectively in my business, 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. Welcome to the podcast. My name is Taylor Avakian, and I'm here with my esteemed guest, Mott Smith. Mott, thanks for being here, man. How you doing, Taylor? Good. Appreciate you having me. So, we were just talking before this about uh you started in 2003. Yeah. In the city of LA. Tell me about what it was like in 2003 versus what it's
like today investing in LA. Right on. Well, actually, I mean, to be to be fair, I started, you know,
even before then.
You know, when I was 16, I got obsessed with real estate development and I used to write fan letters to one of my favorite developers who was a really cool guy and wrote me back.
And who was it?
This guy named Ira Yellen.
Okay.
Okay. He was one of the first. So he he had been a shopping mall developer and then he was he he was like, "You know what? We need to do something for downtown." And he bought the Bradbury building. He bought the Grand Central Market. He bought the Million-Dollar Theater. And he was one of the first kind of Westside people to to be like, let's let's make something of this. And um when I moved to LA when I was 15 and a half from DC, um I just I I got obsessed with IRA and everything he was doing and historic preservation and Broadway and all this. And um yeah, and he was he was great at a total inspiration. Um I I I got my start in real estate really in public real estate. Um I worked for the LA school district when it was going through a massive building
boom.
Okay. And it was my job to do all kinds of things, but among among the things I was trying to do was uh public private partnerships to build schools because the district couldn't keep up. We were building 150 schools. And so um I got to know SQA through that. I got to know deal making through that. I got to know a whole bunch of things. Um and then in 2003 is when I started my own company with my business partner Brian Albert and yeah it's and it's it's different
now. What what prompted you to start your own thing? Was it just you always wanted to be an entrepreneur? You wanted to follow in Ira's footsteps or was it just like I see the vision. I see what happens. What was what made you want to take that step?
So I'm a city guy. I love cities. I love everything about them. I love the what I really love is the the it's a big word but generativity. I love the idea that things are possible and you know you don't know what's around the next corner in a good way. Maybe in a bad way too but in a good way. And uh they attract people, they attract talent, they attract possibility and that's I love that. And I wanted to be somebody who helped make that happen. And um I thought about being an architect and then every architect I met was like don't do it. Um I thought about being a planner and I I saw what urban planning has become which is really just um uh just a finger wag at at at the business community unfortunately.
And you know in the old days planners would make cities and they you know just and if that's what they still did I might have done that but you know I didn't I didn't want to be in the position of just trying to tell other people what to do. Um, and the advice I got you early in my career was if you've got a vision, you shouldn't go be a consultant because a consultant's job is to help the clients with their vision. So, if you've got a vision, go be the client. And that's kind of what's driven me this whole
time. And and which led you into starting the development company and then eventually Amped Kitchens, which we can talk about later. And then you've done and you're also an adject professor at USC US the Emrade. Um, can you tell me a little bit about that? I want to talk about AMP Kitchens real quick.
Yeah.
Yeah. Can you explain to me what Amp's Kitchens is and why you started it?
Totally. So, AMP Kitchens is a builder, developer, owner, operator of large commercial kitchen complexes. Okay. And so, a commercial kitchen is exactly what it sounds like. It's a it's it's a place where food companies can do their thing. And a complex is just a bunch of them in in one building. And so we were actually, as far as we know, the first people to to do this. When when was the first one? We well we started our company back in 2012. We opened our first building in 2015. We we bought it in 2014, built it, you know, built it out and then opened in
2015. Did you see something in the market there was a gap for that or were you fascinated by food? Was it like Uber? What what like sparked the uh idea for this?
So all the above. So there there was no Uber Eats really at the time as far as I know. We weren't even thinking about ghost kitchens. We weren't thinking about food delivery. In fact, we're still not. I mean, we own close to 200 kitchens uh in LA and Chicago now. Wow. And I think one or two of our tenants are doing food delivery. Almost everybody's doing some form of production. Got it. And that's that's what we started out doing. That's what we're still doing. And uh what inspired it was really three things. It was first of all, if I'm being honest, desperation because we had been doing urban infilled development and, you know, small urban housing projects and that sort of thing. And then when the great recession happened, we were really lucky that we got out of our last project and had a little bit of money.
And you know, Brian and I were like, "Okay, this is great. We're going to go in the market and do all these deals." And it turns out, first of all, that's what everybody with any money was thinking. They were all thinking like, "Oh you know, this Can I say I don't know if I can say that."
Yeah. No, you can say whatever.
every everybody was like, "Haha, I've got a little bit of money and the market's dead. Let's go buy some bargains." And so, you know, what that meant was in Palmdale, nothing was happening. But in urban LA, which people still believed in even during the Great Recession, we were fighting with with Wall Street companies like LAR over 15 unit projects. No way. Seriously. And uh what what we learned back then is that there are different kinds of development companies. They're the kinds that are mostly about putting their massive store of capital to work and then there are the people who have to make money and and and Brian and I were definitely in the you have to make money camp and so we couldn't compete with guys that just had to place money. Um and so we were, you know, we we would meet every week for dinner
and brainstorm about what we're going to do next. And we would meet at this friend of ours restaurant in Hollywood and he came over and sat with us one night. He was like, "You know, dude, it it sucks. We've I know all these amazing bakers in Los Angeles and I'm not allowed to buy their bread because they can't get a wholesale license." And we're like, "Huh, tell us more about that." And and he was like, "Yeah, you know, you need to spend hundreds of thousands of dollars upgrading your kitchen and blah blah blah." We're like, "All right." Because you we we had always been very um very attracted to opportunities for what we call regulatory innovation. Mh. So like our we we were we were the first company to bring a track map under the small lot ordinance in city of LA to market.
Um we've done work with charter schools and new markets tax credits when they were a new thing. We we really like kind of being at that edge because we're small. We can be innovative.
Um you're nimble, you're quick.
You see, you want to get ahead of the curve. Exactly. Exactly. And so we were like, "Huh, this sounds like something." like there are people out there that want to sell bread to restaurants and there's a regulatory barrier to that. Maybe maybe there's a project there. And so we called up u I mean the first call was actually to the health department and I called up the head of environmental health who I actually known from my previous job and I said I want to build a place where small bread companies can easily get their wholesale license without investing $100,000. and he said, "Congratulations. You're the first developer to call me about this that I haven't shut down for doing it illegally first."
I'm like, "All right, let's go.
Let's go." Yeah. And so there were no models for this. So there there there was a model for shared kitchens. There's model for like, you know, rented for 4 hours. And there were a couple that were gray market in LA. Um the oldest one I could find is actually in Honolulu, Hawaii from the 1980s. Somebody opened one up. Wow. Um and and that's fine. And that's good if you're doing like farmers markets or catering or stuff like that, but there was no place where you could get a wholesale license because that's the next level up of of regulation. And we spent a little bit over a year working with the health department on creating regulations for uh a building where you could have multiple wholesale kitchens sharing some resources. And um we we bought a building based on that. We used
new markets tax credits to help finance it. And uh we opened up in 2015 and um and and and that that at that time there was one other building in Los Angeles that was one of these sort of gray market things. I think they had four kitchens in it. They had been operating like that for years. Um and today there are 41 buildings like that. Wow.
Yeah.
Geez.
You were kind of the spearhead to really show people that there's a business model in this which what is it? How does the business model work? You So you bought the building, right? You retrofitted it. you got the wholesale license um for the building I guess you could say and then do you charge these distributors or these producers on like a lease like they get a certain amount of kitchen or is it an hourly thing? How does it work?
It's a great question. I mean you know since we did this um there are tons of models around the country there the way it's kind of evolved there are basically now like two sort of categories. There are the hourly kitchens. Okay. Um which we're really not. Um, and there's some great ones in town like Crafted Kitchens is a great one. The kitchen terminal is a great one. If you if you're looking to get, you know, 16 hours a month, fully equipped, that's where you go. Our model is much more uh like an apartment. You know, you rent it. It's got your name on the front. You bring in your own furniture, you know, your own equipment, your own thing, and you you pay us rent, and that's that's it.
Interesting. And how many do you have right now?
We've got three buildings and close to 200 kitchens.
Wow.
Yeah. Geez, how big are these buildings? Uh, our two LA buildings are about 60,000 square feet a piece. Okay. Uh, our Chicago buildings 114,000.
Why did you go to Chicago?
Um, that's also a great question. Uh, one, we we love Chicago and Chicago is a great food city. Um, two, from an economics perspective, it's actually the largest food manufacturing center in America. Interestingly, LA has more small food manufacturers. So LA is actually a better market for our type of thing than Chicago is, but food generally is huge in Chicago because of where it is relative to all the distribution networks and its traditions. Um, and then third, and this is no small part of it, the mayor asked us to come to Chicago. And so we're like, whatever Mayor Rom says you do, I hear.
So interesting. And okay, that's awesome. And are you planning on trying to expand this continuously? Like what's the plan for Amped Kitchens? Is this where most your time goes, I guess, right now? We're all well I mean my time is is is that and then my civic uh kind of volunteer activities and my family of course.
Yes, of course. Um we we we are looking to expand. I mean co threw a bit of a wrench into it. Um and also uh we're you know we're kind of waiting for the market to sort itself out a little because it it is 2021 was a peak year for construction of multi-tenant kitchen buildings. Everybody decided we're we got a warehouse that's underperforming, so let's put kitchens in. Most people don't know how to operate them. And I I you know, I don't want to say this um too uh too loudly, but you know, they're not all going to they're not all going to make it. And and so uh our expansion strategy is a combination of thinking about markets where we want to grow and think about opportunities to buy existing places.
So what uh makes you because you are very a an advocate for or against um a lot of things that are pro- housing, right? So is that I'm for pro You're for proh housing, excuse me. Yeah. Against measure ULA and things like that. That's sty housing. Yes. Is that just because you started in that business or what what because you're in the kitchen industrial space?
That's what's my paycheck.
Yeah. Right. And so what makes you so passionate about the housing part?
Well, I've I've always admired people, developers like like Ira, an example of this, who are civically active, who are voices in the conversation, you know, um uh far too often conversations about development. So, I mean, development is the is the bleeding edge of change, physical change, social change, and as developers, it's kind of our job to be protagonists in that. And it's also, you know, well, so as protagonists, we get the downside, we get the upside, we bear the moral responsibility for what we do. And um which means that the business attracts people like like Moses Kagan, who is one of the most ethical u you conscientious people I know, good friend of ours, and it attracts sociopaths who just, you know, are willing to do that stuff.
It doesn't matter to them. Yeah. Um and so uh so much of the conversation about change about development is dominated by people who want to you know kind of dip their hand in but don't want to be that moral protagonist. So advocates and extortionists and good and bad. And um developers, the people who again have to live live or die by what you know happens are usually so um they're usually so vulnerable frankly to the next 6 months that it's tough for them to speak up in a way that talks about the market generally or policy generally because they need that next project to go. They're going to lose their shirt. I'm very lucky in a way that I've been there. I've done the housing.
I've got the scars to prove it. I now teach about it at USC. I'm chairman of the board of a group called the Council of Infill Builders, which is a a nonprofit that that's all, you know, urban developers. Um, I so I get to be part of the conversation from a position of experience and knowledge. I mean, I'm by by no means the greatest expert out there, but I have some knowledge and experience and I can do it without having to worry about my next deal getting tanked because of what I say. Got it. And um that is like so many people when I what I so many people are having private conversations about what city of LA is doing wrong and a lot of them can't say that stuff publicly because they're afraid
of getting on somebody's bad side. Got it. So you have the luxury of it really not affecting your business because it's a different business. So you feel one you've been there, done that, and there's a responsibility for you being an advocate because this is something that you're passionate about. 100%. Let's talk about ULA. Okay, let's go. All right. So uh there I just read today and again you posted something about there's language to repeal it, but if people for people who don't know and for people who are listening not in the city of LA, can you please just give a quick like what is ULA? why did it happen and where are we at today?
Okay, so let's start with with with the big idea that um it's really there's a lot of um there's there's a lot of need for uh for help for people who don't have the incomes to pay for what housing costs right now. And there are a bunch of different philosophies of how you do that. Some people say we need to give people universal basic income. Some people say we need to give people vouchers like section 8. Some people say we need to build buildings with units that are reserved for people at a certain income level. And um all of that stuff takes money and finding sources of that money is really hard. And so um many people out there have been advocating for uh for for what they call mansion taxes. And there are mansion taxes all over the country from you know New Jersey to California
and everywhere in between. And the idea of a mansion tax is that um there is residential so so very expensive residential real estate mansions let's call them single family homes about $5 million those are sort of a they're a luxury consumer good sure you can buy them as an investment but most people buying a $10 million house are buying it for some vanity reason or consumer reason or whatever whatever it may be. And so the theory goes they're rich people and you know in certain circles uh it's popular to say we should t tax tax the rich and um uh and and it's not really going to have much of a cost on society because if somebody at that income level is paying a little bit more for a $10 million house, who cares?
And it can generate a lot of money for these social goods like helping low-income people who need housing. And um that that's that's all well and good, but you know what Measure ULA did, which was kind of a a riff on what San Francisco did with their Prop C back in 2018, was they they kind of defined mansion very broadly as any property over $5 million. And so that means that instead of just taxing the rich guy who's buying a $5 million house, they're also taxing the small business person who's trying to build an apartment building which is going to cost more than $5 million. Or the person who's trying to reposition a vacant office building at more than $5 million. Or frankly, even the person who tried to develop a multif family property, couldn't make it work, and
had to sell it at a loss. that person is getting taxed under measure ULA because they they defined mansion very very broadly. And what what this has done was well first of all it it again the theory behind mansion taxes is we can take a consumer luxury good and tax it at no cost to society with great benefit to society. and they added in all of these investment properties, office buildings, apartment buildings, movie studios, manufacturing centers, even affordable housing that's not owned by nonprofits. Um, all of that now is in this bucket and it's getting taxed at between four and five and a half%.
And um that has grave impacts to our economy that the people who drafted measure ULA did not fully account for. And uh it now here's the thing. It was a 29page law that was put before voters in 2022. They knew it was called the mansion tax. Nobody read all 29 pages before deciding to vote yes or not. They just they just said, "Should we tax the rich rich to pay for affordable housing?" Yes or no? Well, yes, obviously. Yeah. And um unfortunately, because Measure ULA uh is so so tightly crafted, it can't really be fixed by the city council of Los Angeles. Um now, I I I I should say what what needs to be fixed about it. Yeah. Um you Okay.
So, the theory was from from the drafters that again property is over $5 million. You know, the economy will figure it out. Every prices will adjust, the tax will just become part of the underwriting that will work. Well, it turns out that's not true. Um, my colleague at UCLA, Mike Manville, and I wrote a paper uh published by the Lewis Center at UCLA. You can download it. It's called the unintended consequences of measure ULA where we did a few things. We we reviewed literature on other transfer taxes. And it turns out that pretty much every other transfer tax that's ever existed has had a persistent, measurable, suppressive effect on transactions. Wonder why? I wonder why. You make something more expensive, you're going to get less of it. And we looked specifically at Measure ULA. Commonwealth Title uh is awesome company provided us with 5
years of complete data on every transaction in LA County. And so we could look before measure ULA, after measure ULA, we could look inside city of Los Angeles, outside city of Los Angeles where there is no measure ULA and look at the difference. And what we found was that um, you know, property transaction volume basically moves as the, you know, in the inverse of interest rates. The lower the interest rates, the more transactions you get, the higher the interest rates, the fewer transactions you get. Um, and what we found was property above 5 million, above 5 million, um, in LA, outside of LA, before Measure ULA happened, it was just the inverse of interest rates. And then when Measure ULA took effect, transaction volume in the city of Los Angeles above $5 million, where Measure ULA works, fell by 50% more than the county.
And this does not require any kind of genius statistical analysis. it. You look at the graph and you could see it and it's now been uh two years since measure ULA took effect and the effect has not reduced. It is still a persistent 50% reduction. Jeez. And so that means that brokers aren't making money. It it means that vacant office build Yeah. vacant office buildings are not getting repositioned. Movie studios, the ones that are in process, they're happening. the ones that are maybe going to happen, not going to happen anymore. Um, massive massive impact on multif family. I mean, multif family has just been absolutely crushed and demolished and and and the backers of measure ULA um who don't really want to hear this unfortunately because um you know there are people like me who are somewhat sympathetic to the idea of
transfer taxes and just want it done right. Um they're they're kind of putting their fingers in their ears and say there's no no problem here. the market's going to adjust like you know it's all going to be fine and it and it's it's not. No, it's really not. And and multif family um I mean multif family permitting in Los Angeles uh has fallen off I I I forget the exact number. It's something like 60% um since all of this has happened. And one of one of the things that the backers of things like Measure ULA are relying on is they they're looking at entitlement activity and saying well if people are asking for permission to you know get uh entitlements uh which for those who don't know that's permission to ask permission for building permits. It's not building permits.
Um entitlement activity has slowed but it hasn't fallen off a cliff like that. But um the problem is you can't live in an entitlement. You can only live in a built project that got a permit. And so um you know programs in Los Angeles to boost entitlement activity, excuse me, like the TOC program, the ED1 program, this is word, you know, alphabet soup for the other person listening to this. um they were touted as highly successful programs, but ED1, a USC analysis said that only 10% of the units approved under ED1 actually saw any stage of construction. So, it's we cannot live in entitlements and unfortunately that's what the backers of things like ULA think we could
do. So, I know Culver City has a transfer tax, but theirs is tiered. So, basically, it's taxed above the amount. So, let's say the it's $8 million in the city of uh Culver City and it's the it's taxed on the price above that, right? Which seems like a better version
and and that was put in before measure ULA. Yeah. Yeah. Culver so Culver City's transfer tax is not perfect, but it is a lot better than measure ULA for the reason that you say the the technical term is it's marginal. So, just like an income tax like the the way measure ULA is written, it's got what we call cliffs. So if you are below the threshold, you pay no measure ULA tax. And if you're above the threshold, you're now paying 200 plus thousand dollars. Um, which is insane because, you know, you can imagine a world where income tax isn't marginal. Like now it is. But imagine if like you were making, you know, $99,000 and then if you get a dollar more at $100,000, suddenly you're in a different tax bracket. Everybody say, "No thank you. I don't want that raise." That's basically what Measure ULA did.
They said, "No, people are saying no thank you. who I don't want to sell because I don't want to go into this realm where I'm starting to pay money uh that I that I wouldn't otherwise have.
Makes no sense. Makes no sense. All the conversations I have are about how to get around ULA anyways. Like
Yes.
Exactly. That you open yourself up to loopholes and people trying to figure out gray areas, which probably is not good for anyone to try to skirt around this tax. It's like if your building is going to sell for 5.3, no, we're not going to sell. There's going to be some creativeness that's going to go on to get that below that threshold. $4.9 million plus a few, you know, sports cars. Exactly. Like literally, it it blows my mind that people thought this was something that made sense. So then what can we do about it? Because I just read again, you said that there's language for 2026 for a repeal of this or like what's what is the upload?
Well, okay. So there I'm part of an organization that is working trying to get a negotiated fix to measure ULA because it's got it's got several big problems. I mean what we would like to see is waiverss for new construction meaning if it was built in the last 15 years. This is sort of sort of like what Culver City did, a model of that. Um, you don't pay any transfer tax because we don't want people to stop investing and we don't want, you know, people who are building stuff in order to sell to a long-term owner. We don't want that long-term owner to stop buying. We want that chain to work. And we believe that a 15-year waiver uh would, by the way, it would preserve 87% of the revenues of Measure ULA if we did this, and it would largely restore development activity.
So, we don't see much downside to fixing them fixing the market like this. Um, the other thing that we'd like to see is right now people aren't talking about this, but the measure ULA money is it's very very difficult to spend on what it was intended to be spent on. It was supposed to provide relief for tenants. So, it's doing that. But most of it was supposed to go to new affordable housing and development of new housing. Development of new affordable housing. Correct. Uh, development and acquisition and other things. The problem is measure ULA was written by people without adequate consultation with lenders and developers of affordable housing. So it has built into it these very very All right. All right. So, me measure measure measure ula has built into it really tight restrictions about what you can do um with well actually
sorry. Measure has built into it really strict rules about um covenants and other financing elements. Yeah. Which in the abstract seem fine, but when you dive a little deeper, you see that it actually conflicts with the rules of the big lenders like Fanny May and Freddy. Oh wow. And so people have had a ton of trouble, you know, layering measure ULA money in with other financing sources.
And real quick, so was the money supposed to be given to like Hackla or and these nonprofits or where was it supposed to be distributed or is the city have a I mean Hackla is typically the one who goes and buys on behalf of the city, right?
Uh well, Hack's actually, believe it or not, outside the city. Uh but they they're doing some of that work.
They use Yeah. tax LHB is is Yeah. Okay. All right. So, LA the the goal or the plan was to give the money to LH LHD to then go buy properties or where was the distribution supposed to happen?
Okay. So, so some of the money was supposed to go for eviction defense and uh tenant uh you know income relief and stuff like that. Um so far that's where 80% of the money has gone. It's gone to a a couple of sole source contracts with two nonprofits that there was not a competitive bid and but they're, you know, apparently competent nonprofits and their job is to provide advice, eviction defense, stuff like this for low-inccome families. Um that
was not I think that was supposed to that was supposed to be a relatively small share of what the money is now 80%. Wow. Um the rest of the money um some was supposed to go to administration and other things but the bulk of it was supposed to go to uh to be allocated by LA housing department to nonprofit owners developers of affordable housing and non and nonprofit includes also community land trusts limited equity housing cooperatives. Um, and so the way that money is typically put on the street is through what they call NAS or notices of funding availability. And so it's a competitive process. And what's happened so far is we've had one NOA under measure ULA for I think it was 556 million. Um, all of all that money was awarded, but almost none of it has
hit the streets. And the reason why is because um it again it it it's proven far more complicated to close those deals than uh than than people thought because they didn't think about these incompatibility
issues. Interesting. And does it have to do with the labor union labor or is it the cost of construction or is it what is it specifically that Fanny and Freddy won't lend on it?
Yeah. And and and by the way, it's not just Fanny and Freddy but Yeah. Yeah. But but the thing the thing that um there are two things that Measure ULA um says which are hugely problematic. One of them is what they call a nonsubordination clause. And this is not unheard of in the affordable housing world, but basically the the ULA money says I want to be the last money into a deal. And if you're building affordable housing, subsidized affordable housing, um it's not like a normal commercial transaction where you're going to have equity debt and that's it. In an affordable housing transaction, you might literally have five or even seven sources of debt layered on top of each
other.
Bunch of mass debt. It's crazy. And um what Measure ULA says is I'm I want to be the last one in and I'm going to be senior in the uh in in on on title to everything
else. Wow.
The cap stack. Yes. In the cap stack and and title. So So what that what that means is if you are Bank of America or Freddy Mack or whatever and you uh put a loan on a property, normally the person who places the loan on the property wants to be in first position.
trusted.
Yeah, correct. And measure says at least with respect to the affordability covenants, we're in for a position. And again, not unheard of. Yeah. But and I'm getting really deep in the weeds here. No. What what's different about measure ULA is in most cases, most housing agencies that try to do this, and they all want to do this, they will negotiate that away and soften it a little bit. Maybe what they'll say is the affordability must stay at 60% of area median as long as we're there, but if there's a foreclosure, we'll allow it to float up to 80%. Just so the appraisal works out. Got it. Measure ULA does not allow that. So that really reduces the number of deals that will appraise. Interesting. The second thing it does, and this is an even bigger thing, it says that if you accept ULA money
into your deal, your property can never ever be sold to somebody who is not a nonprofit. And so you're you're you know, I know you're Wells Fargo and you make a loan to these things and you foreclose and there are like three people who could possibly buy at an auction. No lender wants to be in that position where they can't where they can only sell to a nonprofit. And the truth is that most affordable housing out there has a for-profit component. I mean, you you look at companies like Related, which is one of the biggest owner developers of affordable housing. So many people live in affordable housing because of for-profit companies like Related or Amcal. And it's like, why would we not allow them to buy a distressed property to save it?
Yeah.
Um and so we would like to see measure ULA fixed from that perspective as well. Again, the intent where they want the money to go to work and produce affordable housing. Right on. Yeah. But it needs more flexibility so it can actually be
used. And what is this? Uh so the 2026, what what is the language? Are you guys helping write this bill? Like what how do we So what's happening in 2026? Yeah. What's going on there?
Okay. So there there are those of us that believe in mend don't end measure ULA and uh my group the the Council of Infuers is is definitely in that category. Yeah. Just because if it's if it really it became the mansion tax that voters thought they were voting for it would be a great permanent source of money for affordable housing. If it added the flexibility to actually place this money in a variety of deals, the money could go to work, jobs be created, it would be great. Um, again, as it stands right now, only $900,000 has actually been placed in projects. So, so people were out there saying it's created 10,000 jobs and all this stuff are really
lying. Was it at a billion that they projected?
Well, they projected it would be up to a billion a year. It's it's averaged about 300ish million. Wow. Yeah. Um, and n you said 900,000. 900,000 is all that's been spent on affordable housing. Gosh. Yeah. And and and people are out there lying, saying it's created 10,000 jobs, which is
absurd. Yeah. What jobs?
Yeah. Yeah, for $91 a job, you know, it's it's it's absurd. Um anyway, so we want to fix it. It requires the people on the other side to admit that there's a problem and to engage in good faith as opposed to whatever. Um but um and there are people on the other side who are trying to engage in good faith. It's just kind of a toxic conversation right now. Um now then there's the Howard Jarvis Taxpayers Association who we all know, the the people that wrote Proposition 13. Yep. um they have said, you know what, these transfer taxes are a problem and we want to stop them. And the um now this is also getting pretty deep in the weeds and you can cut this out.
No, this is we love the weeds. I'm a I live in the weeds.
Okay.
Right on.
Yeah. So, one of the reasons that transfer taxes have kind of exploded around California in the past several years is because of something called the Upland loophole. Okay. This is what I tweeted about before. There was a 2017 case in Upland, California involving a voter initiative that put a huge tax on new cannabis facilities. And the the the the tax was challenged because if you read the California Constitution, it says that general taxes, which which are taxes that um charge more money than uh is used for a particular purpose that there's sort of surplus money, can only be approved in a general election. and uh that was understood to apply across the board to all general taxes. But the the the people who
defended against this challenge said wait wait wait wait if you read the constitution it says that um yes this is true but it also says that voters have the initiative power and we really have to decide what's more powerful this constraint on general taxes or voter initiatives and the court said you know what voter initiative power is more important and Because of that, if they want to approve it in a special election, which is, you know, a lot of people don't show up at, they should be allowed to do that. Wow. And after Upland, um, city, they people jumped through that window and said, "Okay, let's get a let's get a transfer tax in San Francisco, Proposition C." It was approved with 61% of the vote, which again, if now let's go back to the California Constitution.
It says that special taxes require a twothirds vote of the people. And uh this was cha proposition C was challenged in court. And what the court found was well sure if a legislative body like a city council or a county board of supervisors or the state legislature if they put the tax before voters yes it needs twothirds. But if the people put a tax before themselves it only needs a simple majority. And so those two decisions were like, you know, ding, ding, ding, ding, ding. And everybody who wanted a special transfer tax ran to put one on the ballot because they no longer had to hit that 2/3 threshold. They could do it with less. Measure ULA passed with less. Um, and so, uh, this is, um, I I I I believe in transfer taxes,
well-designed transfer taxes. I believe that it kind of, you know, beggars credul. You could say that uh that people that a tax that has been debated and analyzed and drafted and reddrafted by a legislative by an accountable legislative body in an open process that needs twothirds of the vote to to pass. But if you and I just got a bunch of signatures and put some dumb tax on the ballot with no analysis, version 1.0, that only needs 51%. All we need is a good marketing slogan and that tax can pass. And it seems bizarre to me that the standard for you and me with uh you know version 1.0 O and a and a pocket full of signatures is that we can do that. Where whereas the legislature with its analysts and experts and accountable people, they need a much higher standard.
And so the Howard Jarvis Taxpayers
Association has this initiative on the 2026 ballot. Well, they're going to be gathering signatures for it. We are not part of that effort. Yeah. Um it it basically closes the Upland loophole. It says that every special tax, no matter whether it's Joe Schmo putting it on the ballot or a bunch of experts, um it still requires twothirds.
That's basically what this says. And what's the early polling?
What are people What I've heard is that this is polling extremely
high. So people realize that this is a mistake and they don't want this to be a
thing anymore. I I I have I I You don't You don't see your opinion, but that's Well, no. I mean, I I I hope you're correct. I mean, I I've not seen enough of the polling to know why it is people support it. I mean, I've got, you know, I'm I'm kind of cynical about how a lot of uh you know, initiative voting works. Just like people voted on ULA because it was called the mansion tax. They didn't read the 29 pages. I'm assuming that because this is called the local taxpayer protection act to save Prop 13, people are probably thinking about that.
use the same, hey, look, you got to play the game. We'll play the game, too.
Yeah. You know, yeah. And and and this is this is hanging out. I mean, if if if if it's possible to come to agreement uh with the various stakeholders about how to fix measure UA, you know, in the next few weeks, there are legislators in Sacramento who are willing to help carry that through and fix it. Okay. And if not, then I think a lot of the real estate industry is probably going to put its weight behind this.
And would that uh reverse measure ULA because it didn't pass?
Yes. What it would do is I mean there were earlier versions of this that I read that would um allow people to kind of repass these taxes. What what this initiative as written would do is it would create a 2-year sunset period. So the tax would stay there for two years. All the money raised could be used, but it would then cap new transfer taxes at the statutory limit, which is 055%.
Got it.
Yeah.
Interesting. I guess we're going to have to wait and see what happens. Um, there's a lot of new bills that have happened. It is almost impossible to keep up with the SBS, the ABS, the everything, right? It's ridiculous. one that has taken some steam and kind of takes us back to when you did small lot subdivisions is is SB123. Yeah. Can you explain what SB123 is and do you think that that is a good thing? Is a bad thing. Give me your thoughts on
that. Yeah. I I I really like Al SB 1123. Um I was going to call it a lessby something. They should call it that. Yes. Um uh so there there have been a ton of bills over the past several years uh to promote more infill housing and also you know like like 1123 promoting home ownership which is great. Um almost all of them have come you they call them Christmas tree bills where lots of ornaments are hanging on them. Um to the point where they look good on paper but they can't actually be used. And uh you know so much of what's gone through in Sacramento uh fits that bill where uh it it sounds good but can't
be like SB8 or
SB9 SB8 SB9 all again there might be like onesie twoosy projects fit in. Um, but yeah, a lot of these things just don't actually you maybe they've got high, you know, you have to get a a you have to sign a project labor agreement if you want to use it or you have to include 20% affordable housing and that just doesn't pencil and you know things that again sound good like I want more affordable housing. I want more jobs for union members. I just you know it just doesn't make sense for every project to carry that weight. Sure. Um and SB123 uh is an example of a bill that has fewer of those burdens. So, that's pretty cool. And what it would do is allow you to build a 10 unit subdivision by right on many, many properties in the state. Interesting. Um, including single family properties. Wow.
Now, what's tricky about it is it can't be used in a very high-risisk fire zone. And if you look at the parts of LA where somebody like me or you might want to do this, like say Silver Lake or Echo Park or u know Eagle Rock, those are almost entirely very high-risisk fire zones. So um that's that's a thing. It also says that if you want to use it on single family properties, the the home has to be vacant and not have been tenant occupied for the past or I think not occupied if I if I recall for the last five years. Yeah. And so proving that is is is is highly burdensome. Um and there are other things in the bill that make it really difficult to use. And so I think it is very much on the right track.
I think there will be a handful of properties that don't get knocked out by one of those poison pills. And I would love to use it. I'd love to see somebody else use it.
I think it's a great start. What are some of the uh bills or the things that developers should be looking at? you were forward thinking right when these kitchens came up with with the small subdivision in Echo Park when you built it. Are there any right now that people should be looking at to using right now?
Well, I mean my my favorite two bills of the past I don't know five years. I mean one of them is one uh that that um the infill builders worked on for a decade in conjunction with groups like California Yimi and Spur and Abundant Housing LA and you many other champions. Uh it was AB 2097 AB2097 and um that that is a bill
that limited local parking requirements. Check you out. Hey, exactly.
Take some notes. Yeah. No, no. Well done. I mean it basically what it did is it says that if you are near transit, you no longer have parking requirements. And for those of us in the industry, we know that parking requirements are not the same thing as how much parking are you going to build.
Yes.
It's just it's it's a checkpoint at the city. And where uh parking requirements would really screw up a project is, you know, well, first of all, I mean, you know, I know if if I'm building housing and I want to sell at a certain price point, the more parking I provide, the higher I can sell it for. And I'm not, you know, I'm not going to not build any parking in in most projects. Um similarly with retail, if you want to lease to to Ralph's, you better have some parking.
Yeah.
If you want to lease to Trader Joe's, you better have a really badly designed small parking lot. But you got to have it. Y um and uh what where people were running into problems was if you know, you also know that if I'm building a small project like a 30 unit project, let's just say for housing. Yep. All of my profit might be in the last three units. Yep. And I go to the city and the the Department of Water and Power says, "I'm gonna have to take 10 of those parking spaces for my transformer." And so, uh, I was parked to code, but those 10 parking spaces gone. That 10, that's two parking spaces per unit. I have to reduce five units unless I want to go spend two years having a variance battle with the city and and and a squa battle and all this stuff.
And so, um, that's how park so that's how parking requirements really screwed up projects is a developer should be able to say, I'm gonna go forward at 1.8 spaces per unit versus 2.0 and I'm going to keep those three units and and hope for
the best and I'm going to or five units. Take the risk of of leasing them up or the value is going to maintain where it's
at. Exactly. It's a small enough number. I'll take that risk. And what what the strict parking requirements did was say, "Sorry, that's not an option for you." Um, and what AB 2097 did, and this is because of Assembly Member Laura Freriedman, who's now Congress, Congresswoman Laura Friedman, who's a great urban visionary, now says that in most of urban Los Angeles and in much of urban California, you can build however much or little parking you want and not have to get a variance. Okay. So, that is hu it's huge for restaurants that are open up in retail spaces. It's huge for people doing residential. Um, and it it just removes one major barrier, one major risk point in the entitlement process. The other big thing is AB130, which eliminates SQUA for most infill housing. Again, this was, you know, this Buffy Wick, Scott Weiner, the
governor. Um, what what that bill did was avoid the Christmas tree problem. It was they call it a clean secret reform where it's not seeker reform if you hire union labor, if you do this, if you do that. It's pure seeker reform. It's saying housing, urban housing is good and it it is an environmental mitigation basically. Uh and we should we should not be studying the impacts of every urban housing project. And so that's um is it going to suddenly turn the tap on urban housing in California? No. Because San Francisco still has a very high transfer tax that's making things difficult. LA still has a very high transfer tax as well as its uh inclusionary zoning. I mean I should sorry I should call it the linkage fee.
Other things that are driving up the cost uh you know it's crazy parks fees. Um, so there are lots of things that are still making housing un unfeasible to build. Um, but this has, you know, basically rushed us to the next red light and when we get through that, maybe we'll get housing.
What do you think moving forward for California? Like what it feels like right now there's a push to make it easier to build, which feels like the solution for everyone's problems when they're saying that we have a lack of housing.
Yeah.
Right. Which we clearly do. They make it very difficult. They talk out of both sides of their mouth. Where do you think we're headed in terms of housing for LA?
So, like if if I were going to look at my crystal ball about like it's so funny.
It's so hard for me to answer that question because I never I don't like to think in predictions. Um because I'm always thinking like given what the road map is, where am I going to
turn? What where do you tell your students, right? Your students are coming in and they want to be developers and you've built and and I'm I'm going to get into this next, but you've you've helped a ton of people become developers in the city of LA. You've taught them. What do you tell your students about, hey, Mr. Smith, I want to go develop housing in Los Angeles?
I mean, I I tell them I tell them two things. One is it is really really tough and our our city's rules, laws, and most importantly culture do not promote this. And I also tell them that they are going to be part of the solution because it's going to be their hustle and their scrainess that figures this out. So, as long as they're going in with eyes wide open, that this is not going to be easy. Um, and as long as they're committed to hustling their way to a solution, I'm a huge fan and I think they can do it. I do and I do think that's the answer.
Are most of the students, the young people who are coming through your program, are they excited about the future? Are they promotional? What do they come to you and say, "Hey, I want to be X, you know, I want to do
this." Yeah. They're the the Emirate program at USC is awesome. Yeah. If it's one of the reasons I do it because, you know, when I'm beating my head against a wall all day long, like it's easy to get dispirited and you show up and there and they're and there are these students who are they're not slouches. Yeah, I mean they're they're you know mid 20s, 30s, you know, sometimes younger, sometimes older. Um with real experience and again real hustle and it actually gives me hope. So I really enjoy it from that perspective. I mean don't don't tell them but like they're giving that to me.
Yeah.
Yeah. Uh and and what what I what I see in them is a a real desire to stop at nothing until they can get something done. And a lot of, you know, a lot of them are interested in housing. A lot of them are actually moving beyond housing because they're, you know, they understand that it's uh, you know, like I did at one point that this might not be the the best business right now. But some of them really are committed to it. And um I I' I've seen one of the things I've seen um some people do, in fact um some of my former students have gotten into this is doing some of these uh ADU additions on multif family existing multif family properties as a value ad. Um and they're actually pulling it off and they're and they're doing okay.
And so that's that's a niche that's kind of cool.
I the the ADU thing is very interesting. I would say most of the owners because in a period from like 2012 to let's say like 2022 2021 yeah most of the business plans was you know value ad um buyout tenant buyouts things like that that's how you added value these these old properties right now because buyouts are so difficult um the way that you add value you can force appreciation is through these ADUs so a lot of the owners buyers syndicators are looking for properties with excess land where they can build, you know, these eight ADUs up to eight ADUs per eight units on these lots and it feels like that's a cleaner path or at least a more a path that you can see the end to right you know that you can get something and make something happen.
So, it's it's going to be interesting to see when these new, you know, like SP123, I just saw a buddy of mine who's considering a project that they're working on doing that versus the ADUs and and where the money gets invested in. Because with ULA, for sure, people don't want to invest in these new construction properties. Uh, unless it's clearly makes a ton of sense or the basis is so good, you can write it out and hope hope for the best. Right. Right. So, it's it's interesting to see where that's going to be headed. Um, what what got you into teaching? Why why do you teach?
Um well part of it is I like to keep my my mind fresh and I also I just I I love I don't know it's just something in my personality that I kind of like demystifying things. Um it's kind of like when I was when I was playing music like uh we we talked about this before the the taping started. I used I used to be in a band. That was my job. We were on Intercup Records. We were touring. We did the whole thing. And there was there was like I don't know like a three-day period where I could get into most clubs in Los Angeles where I show up at the door. And I was never like a club guy, but it was kind of cool to be able to get access and be like, "Oh, this is what everybody's freaking out about." Like, yeah, no big deal.
Like, okay, I'm cool with that.
Did it done it?
Good. Yeah. Right. Exactly. And so I like kind of getting access to these kind of arcane things and discovering what's real, what's not real, um, and sharing that with people because I I I like it when people are in the world super engaged and, um, you know, doing it based on reality, not doing it based on theory. And I'm just passionate about sharing that. And and I I found that uh real estate development students for whatever reason, they also they're they're like I they're way into that. They're way into the reality. They don't want to know the theory. They want to know show me what works, show me what doesn't work. I will figure out something and do it. And it's it's a it's a thrill for me.
So I I love that. That's amazing. No, I've been able to speak to um a couple of of classes and and students about brokerage, the brokerage side of the business, and people give uh younger generations a bad rap.
I found it to be the complete opposite. Totally.
I I'm with you, man. They want to hustle. They want to figure it out. They want to build a better life for themselves. And it it's um it's great to see that there's people who are willing to say, "Hey, I see what you're doing. I see what you're trying to accomplish. Let me share some of the wisdom things that I've learned and go, you go be free. Do do what your heart desires. Go be the biggest, baddest affordable housing developer, builder, whatever you want to do. But I'm going to give you the tools and some mistakes that I made and help you try to achieve those
dreams.
100% 100%. Linguistics. I heard you uh or read that you got a linguistics degree. Yeah. I'm fascinated by linguistics.
Yeah. just just on a psychology level because I think people underestimate the power of words.
Yeah. And the way that you phrase them, tonality, like the lang language is so so important in everything that we do. I even saw something recently where with all of these new AI tools, um you have the ability to speak like instead of typing, right? And it unlocks a total new part of your brain and these LLMs to be able to articulate what you're wanting these to do. So, can you tell me a little bit about linguistics? Um, why you have a fascination with linguistics and I guess how you use that in your everyday?
Wow, what a what a cool question. Um, uh, I I've always loved it also. Like I I like I've always loved cities. I've always loved music. I've always loved linguistics. And a big part of it came from when I was little. And I would sit in my elementary school classes and they'd be teaching us, you know, the rules of English. And I'd be like, "That doesn't make sense." And they they'd talk about like the rules of spelling or I before e except after seen, all this stuff. I'm like, "What the hell are you guys talking about? This doesn't make any sense." And um and I I I remember like getting so mad at my teachers. I actually got bad grades uh in in in school until I got to college because I hated And so much of what I was being taught was And when I took my
first linguistics class at at it was actually um at at UCSB where I started and I transferred to UCLA. Um it blew my mind because it was one of the first times where they were saying, "Forget everything you think you know. We're going to teach you the study of what you actually know in your subconscious." And here's an example.
Okay?
Like when you say the word um top, if you you know if I do it in a microphone, you top it. It like gets a little pop. You could feel it. The top. There's air coming out of your mouth. Closerive. Yes. Exactly. Yeah.
Nice.
I I told you I like the stuff. It's very cool. Yeah. And versus if you say the the word stop, that's a different T than the T in top. One of them's got air, the other one doesn't. And they they taught us this in the class. We all had paper in front of our mouth and seeing it flying back and forth and like every native speaker of English knows that but they've never been taught it. And if you've had a native speaker of Hindi for example, the the T and top and the T and stop are different sounds. They're not the same sound. They can hear and articulate those things in totally different contexts than any of the speaker of English can. And I was like, okay, this is my this is my jam. Yeah. Like and and it's like how I approach everything.
Like when people tell me how to do something, how to do real estate development, I don't want to know what we say we do. I want to know what we actually do. That's the kind of knowledge that I'm after. And linguistics is basically just it it happens to be about language, but the methodology is all like don't tell me, show me,
and let's see if I get it right. How did you get so uh well spoken? You're you're you're very well spoken. As are you, by the way. Well, thank you very much. I sometimes I feel like I'm I have the uh millennial like tick. Sometimes I'll say like a few times. So, I'm I'm working on that. Um and the ums and and whatnot. So, I might join uh my friend of mine is part of what is it?
Toast Masters.
Oh, yeah.
Yeah. He said I should do Toastmasters. Said I I would love to. How do you um use How did you get so well spoken?
It's very kind of you to say that. I mean, having a I guess growing up in a in a theatrical verbal family, uh, and, um, you know, doing theater when I was young and and just talking a lot and honestly actually writing a lot because when I when I write, I wonder if you do this, I I'll reread it a thousand times and I'll think about it. I I'll hear it as I read it and I want it to sound good in my brain. And so, I've just spent a ton of time with words like that, you know, on paper, going back and forth, you know, sitting with them.
Yeah. Sleeping on them. Would you suggest people start writing if they want to become better speakers?
Oh, absolutely. Of course. I mean, I Well, I also want to say like whatever works for you, that's what you should do. Sure. I I think uh you know, stuff like Toast Masters is great because it forces you into that environment. You have to kind of be on your feet. Um I think writing is a great way to do it if that works for you.
Um, yeah. What are some ways that you continuously learn? It seems like you're someone who always wants to continue to one be on the bleeding edge, but also learn from different verticals of of life. So, what like where do you go find your knowledge? How do you continue to learn? What where do you go for resources?
Things like that. I love podcasts. I love uh I love Twitter. Uh, I mean, I have mixed feelings about Twitter, but it is a great it's a great when you connect up with good people like you or Moses or others, you know, there there's so many good people out there who are just sharing these little tidbits and it's uh inspiring to me. Um, most importantly talking to people. It's something that that definitely stopped a lot during co um when when we stopped going out. But I've I I just feel like somehow the the lights have come back on in the world even in the last few months honestly where there's so many more social opportunities, so many more events and just going out and being with people if you're if you ask them questions and you're curious. I mean, this is what you're doing professionally right now.
And and and and you're and you're super well spoken and asking really smart, thoughtful questions like the start a podcast, you know? Um I mean, just asking questions. People people have a lot to
teach. I started this podcast because one, I was I'm always very curious. I love the podcast medium. I'm a big fan. I listen whenever I'm on the road, I listen to podcasts and I just like the medium the median of conversation and spoken word and learning and listening because it feels like the tonality of a podcast is just different from listening to a book or something like that. Sure. And um what I've found is that this has forced me to become a better question asker and the act of asking questions one to myself even before the interview. There's parts of this where for distribution for the way that the podcast works, most of the um click-through rates and the way that you actually get people to listen to your podcast on YouTube is through the thumbnail and the title.
And it's interesting because I've noticed that and I've I almost have to think like three levels ahead when I have a guest on. Yeah. Okay, this is the guest. Here's what they're doing. What are the what's the title and the thumbnail going to be? What are some talking points that we need to have? How can I eloquently bring that up in the conversation? What questions would evoke something that I think would would make for a good clip that then can, you know, spread the podcast's message and things like that. There's all these layers to what has to happen when you start asking better questions. How do you reflect or how do you ask better questions about the business, your your teaching? What does reflection look like for you?
Oh man, I I have to think about that one because that is a deep that's a very deep question. Beautifully beautifully put. Thank you. Um well, it it it really depends. I mean, I'll I'll I'll I'll start with business. Um, one of my favorite things in business is to hire new people because you don't have fresh eyes forever and I'm always interested what people see when they're new and they're not kind of, you know, filtering out old stuff. Um, so fresh eyes are very important to me and people with fresh eyes are very interesting to me and so I I like to I like to get reflection from people like that in in in business. Um, in other aspects of my life I I mean
the question is how do I how do I ask how do I reflect? How do I Yeah.
Like because so I'll give you an example in my life, right? So I'm a broker. I sell apartment buildings. A lot of my day is communicating. Sure. Talking to people. I'm discussing what's your problem here? What's your pain? I'm thinking through problem solution things, right? And one way that I've been able to reflect is through I'll I'll take some time on a weekend or something and I'll just write out like what happened during the week. What could I have done better in that situation? Where did this take a turn where I didn't wasn't expecting that or um I do more of a a manual reflection, right? Kind of like a journaling exercise, I guess you could say.
That's great.
I like to talk too which so part part of my reflection will grab wine dinner you know and just talk with friends and just have that oh something they said sparked something in me that it's this kind of you know bounceback effect uh for me in the reflection period of it and I'm curious if there's any rituals things that you do specifically I mean it could be Twitter right maybe maybe you know writing tweets is a reflective act for you to get your ideas out there, refine them, the language. I don't know if you have a blog or anything like that. Is there somewhere or sometime that you sit down during a week, during a month, during your every day where you can find that time to start to dig a little bit deeper?
Yeah, I I I really admire people with that discipline of journaling and and and I um I don't have it myself. Um you Twitter is a place where I you so I used to be a journalist also. Okay. And and I used to uh write and and edit this this insiders real estate planning like publication called called the planning report. And one of my favorite things to do was to edit interviews. We would do interviews with everybody and they'd come back like, you know, 7,000 words of um uh you know, and I'd have to cut it down to like 1500 words. and and I found um my my my inspiration for this was Playboy magazine interviews and I don't
know if you've ever read them. I haven't.
No. You know, there was that there was that cliche in in the 70s like I get Playboy, but I it's for the articles. And um I get it because the writing was phenomenal. Wow. And you can get you can get books. I have a book. It's a It's a collection of Playboy interviews and they were so so efficient and colorful and great. Like just the way they used language was was genius because you would it would sound like the person in the interview, but there were no extra words. It got right to the point led right to the next question. And I'm like, "Okay, I want my interviews to read like Playboy interviews." And so going through that process of editing um does a lot of good for the brain I think.
And and I do write a lot like you know I mean I write articles and I I don't really write blog posts per se but I do um yeah I I tweet and occasionally I'll publish an op-ed or or something like this. Um I'll often write letters regarding legislation and and that type of thing. When I when I teach lecturing, having to do a presentation, that discipline of having to tell the story to a stranger, to a third party is a great way of translating. And I I think um I mean it goes back to dialogue like we were talking about before, like sitting down with your friends over wine or you know, I'll sit down. my wife, my wife is is an incredible uh is an incredible uh co- participant in that stuff because I I'm lucky that I
married somebody who I really respect and who's got a great um you know great a great brain. Um and um by the way that was my daughter calling. She's the only one who can like push through the med do not disturb. Um uh yeah. So, so, um, when you're when you're talking to another person, it it forces you to create a mental model of that person and you can't help but experience your ideas and your words from a new perspective. even if they're just like sitting there stonefaced, just the fact that you're creating that model in your in your head and that new angle on yourself reveals all kinds of things and that's probably most of what I
do. I love that. Um, before we wrap up, I always like to ask a question of with your knowledge, right? You're you have the knowledge that you have today. You get to speak to a lot of 20 and and young people, 30 year olds, right, who are beginning their career or want to create something for their career. If Matt Smith is 22 years old and you start over, but you have the knowledge you have today, right? What would you do? What do you think your path would be? Or at least where do you think the direction you'd want to head into for your career?
So, I don't know that my direction would have been any different because I I can't really imagine a different life than I've had. And
uh you know, my my my father said to me once when I was uh when I was little, like um uh I think I was complaining about some activity that I didn't really want to do or whatever. And he was like, you know, I've always said to myself that if I'm not getting something out of the experience I'm having, that's on me. And I I really took that to heart. And it's been it's defined my life. Like until I started my company, uh I really never had the job that I wanted to have. I I had jobs that were good enough. And I mean, even playing bass in a rock band wasn't exact. I wanted to be a real estate developer. Yeah. Um and uh but every single job I've had has really taught me something. and you know and it could be something
abstract like um something about people and being in the rock band taught me a lot about the politics of business decisionm why it was our ANR guy didn't want to spend the money to market our record even though we had all this feedback it was going to sell because he would have gotten in trouble if he had spent too much money so for him don't spend the money don't put it out you know that was an important lesson in business and politics um when I worked for LA Unified school district there was ton. I learned that was probably the most educational job, no pun intended, I've ever had. Um, one of the most important things I learned was about environmental law because I had a I I had to work on SQA and some workarounds to SQA and I
had access to the best lawyers in the state, all of whom were working, you know, on retainer for the LA Unif school district. And that was like a PhD in squa from the best teachers I could possibly imagine. That was a really concrete thing that I got from that job. And so I I I don't know that I think differently. I guess if I could give advice to myself, it's that I would trust my gut more sooner. that there are a lot of situations where um which called for decisive action like a bad relationship or an opportunity that I should jump on that I would I would hedge a little bit because I didn't have the life experience yet to know that h this something like this doesn't come around all the time or this relationship is not going to get any better.
And uh I if I could give myself one piece of advice, it's that. It's it's to trust my gut when something's over and to trust my gut when something's possible.
Matt, thank you very much for being here. Hey, my pleasure. Thank you.