Financial Freedom with Real Estate Investing

What’s differentiates a successful multifamily real estate investor from someone who dreams of financial freedom but doesn’t take action? Todd Fox contends that a willingness to fail is what sets him apart and that his failures have helped him learn, grow and gain the confidence to go out and create the next big opportunity.

Todd is the CEO of Visum Development Group. In the last 15 years, Todd has developed $35M in projects in the Ithaca metro area, and he oversees all aspects of the firm’s projects from concept formation to long-term stabilization. Visum specializes in new construction and the redevelopment of residential properties, working to maximize returns while mitigating risk for investors. The company offers a range of luxury student housing, residential and commercial investments, and they are currently working on a 207-bedroom student housing project for Cornell University worth $37M.

Todd joins me share his journey from bankruptcy to successful developer, discussing how that dark time inspired him to pursue real estate full-time. He explains how he got his start with duplexes, purchasing his first property at auction and doing an incredible amount of legwork to find the second property—three years later. Todd describes his original intention to scale up to ten duplexes and how his dreams got bigger as he gained confidence and secured a network of investors. Listen in for Todd’s insight on following your heart, learning from failure, and setting small goals to build momentum.

Key Takeaways

Todd’s path to real estate development

  • Quiznos franchise for three years
  • Bought property at auction, redevelop as duplex
  • Internet startup in NYC
  • Eight years of full-time real estate

What inspired Todd to pursue real estate full-time

  • Making $20K/year on duplex
  • ‘What if I owned 10?’

Todd’s painful experience with bankruptcy

  • Personal guarantee on Quiznos lease
  • Next owner stopped paying rent
  • Sued for $482K
  • Questioned path of entrepreneurship

How Todd overcame the inability to secure a bank loan

  • Confident in ability to build product, find deals
  • Promised partner double usual return in exchange for financing

How Todd found his next deal

  • Looked through tax maps for parcels
  • Letters, door-knocking
  • Found house and double-lot worth $500K for under $300K
  • Rented house, built two new duplexes on lots

Todd’s decision to scale beyond ten duplexes

  • Mastered renovations, duplexes
  • Opportunity to build six-unit
  • Raised $750K, on-time and on-budget
  • Now working on $37M building

The organic way Todd built a network of investors

  • Father of tenant in first duplex in student housing business
  • Reached out with interest in investing, hit it off
  • Brought in friends as deals grew

Todd’s approach to raising money

  • Properties under contract before money raised
  • Ability to flip contract in worst-case scenario
  • Trust investors to support (calculated risk)

Todd’s advice for aspiring real estate investors

  • Learn from failure, gain confidence
  • Follow your heart, do what you love
  • Don’t be afraid to fail

Todd’s insight on what sets successful entrepreneurs apart

  • Understanding that it’s okay to fail
  • Willingness to do things that are uncomfortable
  • Set small goals and build momentum
  • Don’t wait for big opportunity, go out and create

Connect with Todd

Visum Development

Visum on Facebook

Visum on Instagram

Resources

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

Free eBook: The Secret to Raising Money to Buy Your First Apartment Building

Review the Podcast on iTunes


The two biggest issues multifamily owners face are turnover and resident satisfaction. If a property is not at full occupancy, your bottom line takes a significant hit. How can you address both of these issues and create a community in your apartments that makes residents want to stay, even if the rents go up?

Pete Kelly is the CEO of Apartment Life, a faith-based nonprofit motivated by a commitment to building relationships and community. Apartment Life serves the multifamily industry, redefining the resident experience in order to increase retention, improve tenant satisfaction, and enhance the community’s online reputation.

Pete sits down with me to share his background in the nonprofit world, explaining the basics of Apartment Life as an organization. He discusses the research around loneliness and public health, customer engagement and brand loyalty, and the economic impact of the CARES Program. Pete offers the specifics of what the CARES and Workforce Housing teams do to engage residents and how the faith-based roots of the organization impact their mission. Listen in for Pete’s insight on building a community that is good for the human soul AND the bottom line.

Key Takeaways

Pete’s background in the nonprofit world

  • 24 years with organization serving young people
  • Two years as CEO of Apartment Life

The fundamentals of Apartment Life

  • Relationships good for soul AND bottom line
  • Friendships increase chances of staying
  • Team hosts events, creates ‘sticky community’

The research around loneliness and public health

  • 26% more likely to die if feel lonely
  • As bad as smoking, obesity

The business research around connection and engagement

  • Emotionally connected customer 52% more valuable
  • Spend more money more often, loyal to brand

How friendships affect a resident’s willingness to stay

  • Seven friends in complex = twice as likely to renew
  • Neighbors themselves are amenity

The financial benefits of the CARES Program

  • $138K annual value to owner
  • 3 renewals/month

What the Apartment Life teams do

  • Usually husband/wife team that lives on-site
  • Events to connect residents
  • Opportunities to care (e.g.: baby gift, ride to airport)
  • Visit tenants 90 days before lease renewal
  • Build positive online presence for community

The cost of the CARES Program for owners

  • Provide 2BR/2BA unit for CARES Team
  • Management fee of $650 to Apartment Life
  • Budget for events ($2/door)
  • Best for A/B Class properties, at least 250-units

The alternative Workforce Housing Program

  • Class C properties in lower income communities
  • Team lives off-site, paid hourly
  • Manages requirements for LIHTC

The faith-based element of Apartment Life

  • ‘Love thy neighbor’
  • Recruit teams from local churches
  • Follow Fair Housing Act guidelines

The mission of Apartment Life

  • Dramatic impact on residents’ lives

Connect with Pete

Apartment Life

Email petekelly@apartmentlife.org

Resources

‘Why Loneliness May Be the Next Big Public-Health Issue’ in Time

‘Loneliness and Social Isolation as Risk Factors for Mortality’ in Perspectives on Psychological Science

‘The New Science of Customer Emotions’ in Harvard Business Review

CARES Program Financial Impact Analysis

Low-Income Housing Tax Credit Guidelines

Fair Housing Act

Financial Freedom Summit

Partner with Michael

Invest with Michael

Michael’s Course

Free eBook: The Secret to Raising Money to Buy Your First Apartment Building

Review the Podcast on iTunes


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