MB 112: Scaling Up from a Duplex to 2,700 Multifamily Units – With Ivan Barratt
Financial Freedom with Real Estate Investing
English - June 05, 2018 19:56 - 27 minutes - 38.3 MB - ★★★★★ - 464 ratingsInvesting Business Education business entrepreneur health entrepreneurship finance marketing lifestyle investing entrepreneurs interview Homepage Download Apple Podcasts Google Podcasts Overcast Castro Pocket Casts RSS feed
“It’s these little things that we do every day that get us closer. I remember climbing a mountain in high school, and the guide told us, ‘Don’t look at the summit. Focus on putting one foot in front of the other, and the summit will take care of itself.’ That’s exactly how I treat business. As long as I know I’m on the right mountain—which I firmly believe is multifamily—I come in here every day and focus on putting one foot in front of the other.”
Ivan Barratt is the founder and CEO of Barratt Asset Management, a real estate investment and management company out of Indianapolis that specializes in the acquisition, redevelopment and management of multifamily apartment communities. Since forming the firm in 2010, Ivan has raised tens of millions in equity, acquired 2,700 units, and grown BAM to a best-in-class management company, boasting $100M in assets under management.
Ivan joins me to explain how he started small with a duplex and 6-unit property, financing deals with hard money loans. He discusses his gradual transition to larger deals, describing his approach to raising capital by building trust with potential investors in the business and medical communities. Ivan shares his ‘mortal sins of multifamily’ as well as the game changers that have allowed him to scale up to 2,700 units. Listen in for Ivan’s advice around doing little things every day to prepare for your career as a multifamily investor!
Key TakeawaysHow Ivan got his start with a duplex
Put down as little as possible Lived in one side, rented other ‘Journey of $10K units starts with first deal’What Ivan would do differently given the opportunity
Go straight to 20-, 30- or 40-unit deals Takes same effort to close small deal as large one Track record and momentum are most importantHow Ivan got started with hard money loans
Small multifamily opportunities in market Great lender put up cash for acquisition, renovationIvan’s early 6-unit deal
Evaluated using simple flipper equation Bought for $150K, $100K in renovations Refi nine months in to put high-interest debt to rest Sold for $350KHow Ivan transitioned from hard money to raising capital
Built large pipeline of contacts, ask for referrals Conversations with people in business and medicineIvan’s approach to building relationships with investors
Get to know people through common interests Explain what you do and treat people well Deliver value, educate on what good deal looks like Network multiplies on its own over timeIvan’s ‘mortal sins’ of multifamily
Tried to renovate project out of cashflow Viewed property management co as profit centerIvan’s AHA moment after the crash
Rereading Rich Dad… reinforced cashflow as king Realized need to build model and scale Reduced risk for WHEN market changes, not IFThe game changers that have allowed Ivan to scale
View property management arm as a necessary machine (not a profit center) Bring in a partner for sweat equity, combined forces greater than the sum of partsIvan’s advice for aspiring multifamily investors
Get educated through podcasts Underwrite 100 deals on LoopNet Set networking goals (investors, brokers and team) Do little things every day to prepareWhy Ivan continues to grow and scale his business
Driven by possibilities, freedomIvan’s perfect day on Gulf Shores
Up before sun to workout Mission-critical emails/calls, check in with partner Day on beach or at pool with family Connect with IvanCall (317) 762-2625
ResourcesRich Dad Poor Dad: What the Rich Teach Their Kids About Money—That the Poor and Middle Class Do Not! by Robert T. Kiyosaki
Michael’s Syndicated Deal Analyzer
Michael’s Deal Maker Mastermind
Free eBook: The Secret to Raising Money to Buy Your First Apartment Building