Neal Bawa is known as the mad scientist of multifamily real estate investing, and the founder of Grocapitus, which is invested in projects worth $150MM. He’s also the creator of Multifamily U, a multifamily education business that teaches thousands of students each year.

The Mad Scientist engages very frequently and deeply with his vast investor and RE Pro community, with tens of thousands of active connections and conversations across Facebook, LinkedIn, Meetup.com, Youtube and other channels. Neal is a backyard tomato farmer and a protein diet health nut. He believes in positivity and Karma. He is passionate about the sport of Cricket and about the enormous potential of self-driving electric vehicles to solve the global climate crisis.

What You’ll Learn In Today’s Episode:

  • eCommerce has jumped from 6% to 10% of U.S. sales during the coronavirus, and it is likely this trend will continue. Currently, there is a shortage of warehouses and the logistics of dealing with such a large shift to eCommerce, because of this Neal anticipates opportunities in industrial warehouses, both now and in the future.

  • The current pandemic, coupled with the lockdowns, has drastically accelerated the number of companies that are switching to full-time remote work. This could lead to a resurgence in suburban living, as people seek a lower cost of living, more space, and less traffic outside of large cities.

  • Neal doesn’t focus on cities, he focuses on corridors of opportunity. For example, the corridor between San Antonio and Austin, TX, where the smaller cities in between are experiencing dual compression due to the growth of the two larger cities. In his words, “dual compression is the most powerful force in real estate.”

  • In today’s virtual world, you can run a business with the bulk of your staff being remote, virtual workers. Neal has about ⅓ of his workforce as boots on the ground in his markets, with the remaining ⅔ being virtual, sourcing talent from across the globe at competitive rates. This has allowed him to 10x his growth and outreach.

Ideas Worth Sharing:

“20-30 years of shifting to virtual work happened in four months.” – Neal Bawa

“I believe in corridors of opportunities, not cities.” – Neal Bawa

“Data beats gut feel 100% of the time.” – Neal Bawa

Resources In Today’s Episode:

Books Mentioned In Today’s Podcast

Enjoy the show? Use the Links Below to Subscribe:

 

Transcript

 

Mark: Today’s guest is known as the Mad Scientists of multifamily real estate investing. He’s the founder of Grocapitus, which has invested in projects worth $150 million, as well as MultifamilyU. A multifamily education business that teaches thousands of students each year, 4,000 real estate investors attend his training webinars, seminars, and boot camps each year. I’d like to welcome Neal Bawa.

Neal: Thanks for having me on the show and the Wild Wild West, Mark. Thank you.

Mark: Thanks Neal. Welcome to the Wild West. I’m excited to have you on.

Neal: Yes, it’s been a while since we met, I’ve been looking forward to this because it was like, wow, I actually toured one of Mark’s properties and now I get a chance to be on a podcast with him.

Mark: You’re up in San Francisco, right?

Neal: I am. I live in Fremont, the home of Tesla.

Mark: Oh, nice. Nice. Okay. And I think that’s a unique property in my portfolio that I showed you. And so, it was really cool and it was a really fun project to buy and renovate. My goal was just to restore it and bring out that old world character and play up the Hollywood history to it.

Neal: And you certainly did. I mean, we walked into the foyer and I was like looking at Hollywood history and there was so much collectic stuff there I was like, Mark’s tenants must absolutely adore what he’s done to this building. They just love living here and talking about it.

Mark: Well enough about me. I want to get into your story. How did you start? Did you have a previous life before drifting into multifamily?

Neal: Oh yeah. So, I am a geek. I’m a technologist and I accidentally got into real estate in reverse. I got dragged into it, kicking and screaming by my CEO of my technology company, who in 2003 said, let’s build a custom campus. And I want every room designed specifically for our use every room, height and size and width and depth have to be specific to our needs.

And we were a technology school a healthcare school. He was like, I want every desk measured. And I want to make sure that we get the right number of people in. And I was like, great. This sounds all great. And he was like, yes. And you’re going to do it. And I’m like, I’ve never even rehabbed my own home. I haven’t painted a wall. And you want me in charge of building a $6 million campus from scratch. That’s custom.

Mark: What was your title at the time.

Neal: I was Chief Operations Officer.

Mark: Okay.

Neal: In the middle of it. He decides to do this and to his credit, he did so much of it. And he was so ahead of me and had so much knowledge that I couldn’t even dream up. So, I had this mentor guiding me through the process. During the day, we were basically running a company that was growing almost too fast to control. And during the evenings, late evenings, we were sitting down and doing our design work and dealing with fire code issues.

And then going into the city in the morning and the learning there of everything from occupancy to vent levels to fire doors was phenomenal because you never get that when you simply buy and rehab a building. Because a lot of these issues actually come up before you build a building. My foundation was very strong. Since we finished. I have been thanking him ever since. You gave me this incredible degree in construction that I could never have gotten. And it was so relevant to my business that I really understood every aspect of it. And I took the time to understand that.

And so basically, I started with new construction. After single family then into multifamily and then came back to multifamily construction. So, my journey is from 2003 to 2017 years has been massive commercial construction, not one building. We ended up with six.

Mark: Wow.

Neal: So, it’s just bizarre how that is not a sequence. It just is bouncing back and forth.

Mark: What an amazing education.

Neal: It was. And what I realized, the first thing I realized as soon as the building was done was the tax benefits were incredible. And so, I’ve become very sensitive to taxation. It’s not about what you make, it’s about what you keep.

Mark: Exactly.

Neal: And that’s where real estate I realized had incredible advantages. The 2017 tax act bonus depreciation, hundred percent depreciation, the LLC changes that they made. They were all very clearly written by a whole bunch of real estate lawyers somewhere.

Clearly there’s a group of people that seems to bias the tax system their way. I’m going to basically benefit from that, nothing wrong with doing that. It is the legal tax system, and that’s what I’m doing with my investors. I had a building that was a 1972 building. I wanted to just give you this episode just to illustrate how powerful this is.

He gave me 75,000. I think it was not this last December, but the December before that. And a couple of months later, I sent him a K1 that was negative 80,000. So, it was like, how is this even possible? My basis in the property is minus 75,000. You’re sending me a negative 80,000. Did my property get wiped out? I’m like, no, no, no. This property is doing really well. And he’s like, “So what is this stuff?” And it’s like, I’m not doing anything different. I’m not doing anything unusual.

I’m doing just middle of the fairway, cost aggregation, depreciation. They call in this company. And they gave me a $3.2 million depreciation. This $80,000 is your share of that. This is astonishing. ‘Cause he had a lot of passive gains in that year.

And he said, Neal, you just wiped off $80,000 worth of passive gains from my portfolio. This is incredible. He had never invested in syndication before. And it was really delightful because you couldn’t do that until 2017. So, the tax act allowed you to do a hundred percent depreciation in a single year.

Mark: Yeah, that’s great. I know, I think multifamily is pretty competitive as an asset class pre-tax, but when you factor in taxes, it’s sores ahead.

Neal: It definitely does. And I think it also in the last four months over and over again, people are telling me that there is a very strong realization amongst investors in commercial real estate, that multifamily being a need-based asset class.

It’s very different from retail, very different from hotels because we’ve seen across the board in the United States about a 2, 3% reduction in income that’s coming in mostly delinquency. Whereas retails, basically their income’s been cut to half or less. And COVID has really underlined how need-based asset classes are just different.

Mark: And how vulnerable retail and hospitality is.

Neal: Absolutely. Those two areas are incredibly vulnerable and some of the others that people don’t traditionally considered to be vulnerable were senior housing. So, this virus is now clearly airborne and grandma’s going to get it at some point. And so, people are pulling grandma out and moving her to their spare room or their basement or renting a house for her or putting her in a facility.

That’s one of those single-family homes with four or five people in there. And so, we’ve seen a tremendous hit for the senior housing sector, especially for the big box people. But the big box guys have seen a tremendous hit in the last four or five months.

Mark: Wow. And that’s a great point about risk in vulnerability. For the past couple years pre COVID. It feels like, and I was a little nervous about it is nobody was factoring in any kind of vulnerability or risk. You were like, Oh, it’s just going to charge upwards it’s recession-proof and that’s not the case. And often analyzing buildings in assessing what you’re going to buy and hold. I think a huge part of that is asking yourself, what are the vulnerabilities? What are the risk factors?

Neal: Yes. And I think that we’ve seen the vulnerability and this time it’s the dual vulnerability. We are clearly in a deep recession. High levels of unemployment. We were also in a technical recession. But then on the other hand, we’ve got a situation where a large number of people that live in apartment complexes. These are people kind of in the bottom 25%, from an income perspective, just simply having no jobs, no prospects.

Their entire industries are wiped out. It’s affecting multifamily. But what we’ve seen is the impact is still very tiny compared to other asset classes. Now there are other asset classes doing as well as multifamily or even better. The one that I like to mention is industrial. Industrial is privileged. 6% of U.S. transactions are e-commerce the remaining 94% are brick and mortar. But that 6% grows very fast, much faster than the U. S. economy. Five or 10 times faster than the U.S. Economy.

And so, I’ve been saying, look, we’re going to get to the point where there’s not enough logistics, not enough warehouses and too much retail. And I’ve been saying that. I think it’s going to take 10 years for that transition to happen.

Mark: To occur.

Neal: So, the United States went from horse and buggy to cars over 11 years. And so, it took 11 years for that transition. And we’re in this transition to eCommerce. But what COVID did was massively, hugely crazily accelerated the e-commerce transaction. And so, e-commerce all of a sudden jumped from 6% to over 10%. Where’s the logistics? Where are the warehouses? We never built enough warehouses to support this.

Mark: Yes. That’s a great point on e-commerce as well. A big obvious one is work habits of Americans is now the office may become less valuable.

Neal: Very much so. And I’m going to give you a vision that is completely insane. So please be warned. What you’re about to hear is just Neal Bawa’s insanity. I am known as the mad scientist in multifamily.

Mark: The mad scientist. Yes.

Neal: So, this is an incredible tragedy. Half a million people are dead before all is said and done 2 million people will die. Most likely, worldwide. This is going to take a 2-million-person toll. So unspeakable tragedy. For a moment see if you can mentally put that aside. And COVID is one of the best things ever to happen to humanity. And here’s why the world had become an extremely inefficient place.

If you look at the world at night from space, 98% of the world is not lit. It’s dark. We live in 2% of the space. We cram more and more and more people into these insane metropolises. And then we complain about lack of space. And then we do crazy things like paying $4,000 for a one bedroom of rent in San Francisco. Nice bedrooms are available 30 or 40 miles away for 600 bucks.

So, what we’ve had is a phenomenally inefficient economy that was based on basically traffic and freeway access. And over the next 10 years, COVID changes that. And it changes that for one massive reason. In the last four months, every CEO in the world, were forced to work from home and forced to build up Zoom and forced to build up their virtual backgrounds.

You see all these CEOs now with beautiful virtual backgrounds on Zoom. And they’ve got all the lights and everything all set up. They wouldn’t have done that in the next 10 years. They maybe wouldn’t even have done that in the next 20 years, but because COVID put a gun to their head and said, this is the only way for you to run your business. 20 to 30 years of shifting to virtual work happened in four months. That’s 20 to 30 years of this world progressing.

Because if you think about it, why shouldn’t we use the rest of the 98% of landmass that the world has? Look at the United States. We need to drive through the U S you drive from Seattle to Orlando, 98% of the time. you’re just in fields. Empty space. We’re not using that. So, the world had become an extremely inefficient place and it had massively impacted our growth.

It was slowing our growth to a crawl. It wasn’t real estate and we can’t blame ourselves. It was really in the end, the CEOs of companies that were to blame as a collective group. Obviously, some of them are better than others, but now you have company after company announcing, you never have to come back. And what is happening is, and some of those people will want to come back one day, a week or two days a week, but they will now be going forward with dot com’s that never established office space.

They’re going to start virtual and stay virtual. And they’re going to be tools built like Zoom that are going to be 10 times better than they are today. Creating ever better, nicer, higher quality virtual experiences. Two products are coming from Apple. So augmented reality it was going to take 15 years to get here. Now it takes three or four. The economy now becomes an economy of you work, where you want. You live, where you want. COVID in a bizarre sort of way is a change in the way the world works.

Mark: Yes. Making it more efficient.

Neal: Massively more efficient. We can now tap into real estate everywhere and be free of the tyranny of freeways. Los Angeles is a perfect example. 405 is known as the world’s greatest parking lot. That is the tyranny of freeways that people, and by the way, the U. S. doesn’t have it worse. If you look at Brazil, if you look at India, we’ve all been suffering, tyranny of freeways. And we’ve all certainly been released and not everything changes, but enough changes for the way the world works to change.

Mark: And another efficiency that the COVID has kind of forced and accelerated is the natural pairing of businesses due to their inefficiencies.

Neal: I call it the great culling.

Mark: The great culling.

Neal: The great culling happened in real estate in 2008, but it didn’t happen in other industries. So, an efficient economy must constantly cull the bottom dwellers. And the Fed’s policies were protecting the bottom dwellers, the least efficient companies, the ones that have the least ability to grow. What COVID does it culls the weak companies.

Market share goes to the strong ones and those strong ones they invest into our future. They invest in growth. They invest in employees; they invest in infrastructure. That’s what we needed. We’ve all been hearing that in the last five or 10 years, companies have stopped investing and are putting all of their money into buying back their own stock.

So, they’re just buying their own stock back instead of actually opening new locations or investing in R and D. R and D Investment is at an all-time low. And I think that’s happening because those companies have too many of these annoying little competitors that really should be going out of business. So, it is the great culling that we’re watching. And it is a positive process, even though like every culling, you go through pain to get to the other side.

Mark: Painful but necessary. What else do you see happening in the coming months? It’s a burning question. Everyone seems to want to know is, what do you see happening in the real estate market in the immediate future, as we’re doing this interview, what are we a week or 10 days away from stimulus ending? And also, some of the—

Neal: —unemployment.

Mark: The eviction moratoriums ending.

Neal: End of July, a number of things happen. Number one is the supplementary $600 a week unemployment piece goes away. And that’s a big piece because in certain parts of the United States, not in California, but in other parts of the U. S. You are making more money by being unemployed then you were making by being employed.

So that ends, which is a positive thing, because now those people are forced to go back and find jobs. It’s a positive and a negative because now they have less money. So, you’re going to see evictions and delinquency jump up in August and in September, but then on the other hand, people will have a strong focus on getting back to work. Also, in the PPP and the EIDL programs are kind of running out of steam as well at the same time. So, we had a kind of a propped-up economy that ends in July.

So, everyone expects rents are going to fall about 4%. There’s no doomsday for multifamily. In fact, multifamily is projected to come out of it, very strong because they’re saying second half of this year, a fall rent is flat first half of next year. And then they jumped back up more than 4% in the second half of next year.

So, there’s a compensation mechanism, just like 2008 and 2009 drop. And then ’10, ’11, ’12 massive increases, including one of them being double digit increases in one of those years. They believe the same concept will happen because the biggest thing that happens in a recession is there’s a whole bunch of people that were about ready to buy homes. And then they lost their jobs. A percentage of them will never get to the point where they can buy another home. So, the U. S. home ownership rate will then dip in every recession.

It dips. A, 2 or 3% dip means 4 to 5 million new apartment renter households that are created by the recession. And when those are created, well the inventory is not there. We even struggled to put up 300,000 new apartments in the U. S. This year, we might not even hit 200,000 because a lot of them are not being built.

So now you have a situation where there’s a supply demand gap being created, but that doesn’t mean that the pain won’t be there. So, we’ve already seen apartment prices declined by 5%. We think it’s going to go down 10% in the second half of this year, maybe Q4 and Q1 of next year. And then slowly start to move back up to where they are. We’re seeing no impact on CAP rates. We don’t expect to see an impact on CAP rates, because if you print $4 trillion, that has a compression effect on CAP rates.

So, you can’t have CAP rates go up, but prices will go down in the short term because (A), there are some distress properties that are going to come to market and (B), net operating income has gone down because of delinquency in the last three or four months. And we value apartments based on the P12. And the P12 is weaker, starting March. And getting weaker each month. And it would probably get weaker in September again.

So, we’re going to see a price decline there. Single family, again, 5 to 10% declines. Once again, there’s not enough inventory in the marketplace. So, we may not see broad decline. So real estate, really the kind of 2008 stuff that we saw is not on scheduled to happen for single family or multifamily, but you’re going to see things much worse than 2008 in the retail and hospitality sectors.

Mark: Now, if you’re enjoying the show, please do us an easy favor and hit the subscribe button. As a listener I always wondered why podcast hosts are always begging me to subscribe and rate them. Well, now that I’m on the other side, I see why. It allows other listeners to find you in an era of unprecedented hype over real estate investing. My goal is to be a truth teller. Real estate is not as easy as it’s made out to be, but you can do it. If you can get past the hype and get to the truth.

My aim is for this show to help with that. And if you’d like to learn more about who we are and what we do at Quantum Capital, please visit our website at quantumcapitalinc.com. Where you can find podcast, episodes, multifamily resources, and learn about opportunities to invest with us. Anyway, let’s get back to the show.

Mark: And what were you doing specifically with your portfolio. How’s your strategy shifted in it? Could it be your buying strategy as well as your operational strategy?

Neal: On my operational strategy. All I’m doing is I’m communicating with investors twice as often. I call it the chatty cathy strategy. On top of that, we’ve told investors, nothing has happened with our properties at this point in time, but we’re not going to give you your distributions. This strategy is called work test.

So, every property of ours starting March, we shut down distributions and investors have come to me and said, “Why are you keeping my money?” The answer is, I’m just keeping it temporarily. If bad things happen. You’ll thank me for keeping it. If bad things don’t happen, I’ll distribute it back to you because it’s your money. So that’s my operational strategy. I’ve shut down all rehabs. I’m focused on occupancy. I’m focused on tenant quality.

So right now, I’m perfectly fine with tweaking my rents down 3 to 5%. So, we’ve talked with our property managers where needed we’re tweaking rents down. We haven’t had to drop them a lot, but we’re certainly not looking to hike rents. Even in good markets that are seeing rent increases.

We’re focused more on occupancy right now. My purchase strategy is simply this. I am a shark and I’m waiting for the blood. There’s not enough blood in the water. I want to buy. So, people ask me, “When do you think there’s going to be blood in the water?” My answer is it’s going to be very short. It’s going to be Q4 and Q1.

Second; when somebody announces that an approved vaccine happened anywhere in the world, remember this is a worldwide crisis consumer optimism benefit that you get, the boost that you get is going to take prices up. So, I think prices only really go down Q4, Q1.

Mark: Sure, that makes sense. In terms of acquisitions, I don’t even know. Where is your portfolio in general?

Neal: We’re Southeast Southwest. I like to be in places where landlords are in control. And you mentioned that you haven’t had a lot of challenges with your tenants. That’s good. But to me, the focus is on extremely fast-growing States that have massive population growth.

Mark: Arizona, probably.

Neal: If you look at its Southeast Southwest, so we’re looking at Southern part of Utah, Utah’s a very fast-growing State. So, you look at Utah, you look at Arizona, you look a little bit of Nevada, but right now we’re not focused in Nevada. We skipped New Mexico and then we hit Texas. And then we look at Georgia, Tennessee, South Carolina, North Carolina, Florida, that is the traditional kind of syndicators Southeast Southwest area that we tend to be focused on.

Mark: Sure. That seems to be common. Do you invest in Salt Lake City by any chance?

Neal: I do. I have properties in Salt Lake City, and I believe in corridors of opportunity, not cities. So, three great corridors of opportunity in the United States are Northern Salt Lake to Southern Provo. And you can extend up to Aspen if you want. So, you want to look at it as a longer corridor. It’s 144 miles from Aspen to South of Provo. That’s one corridor.

The second corridor is North of Orlando to South of Tampa. So, you go up 20 miles beyond Orlando. Then I Freeway four running from Orlando to Tampa, and then down through Sarasota ending in Fort Myers. That is the second corridor of opportunity.

The third one, which I now believe is the strongest is the 59 miles from San Antonio to Austin because San Antonio and Austin are merging into a Mega Metro. And New Braunfels and San Marcos, the two cities that are in the middle are just becoming compressed from both sides. Dual compression is the most powerful force in real estate. And you want to be in a state that produces that much of a population growth. And it’s a very educated audience.

If you look at Utahns and you look at the Bachelor’s Degrees and the Master’s Degrees. Everybody’s got a degree from UVU or BYU. Massive universities with very high rates of academic achievement. And so, you have both population growth and a population that’s very fixated on white collar type—

Mark: Professional jobs.

Neal: –degrees. That is huge.

Mark: I feel like that’s, what’s happening in California. There is like a net loss of population in California, but at the same time, I think business school grads, anybody that wants to participate in the tech revolution, they’re coming to California because the high paying jobs are on the coast.

Neal: That has been true. But I believe that post COVID that changes because COVID opens up the rest of the United States and gives those grads an incredible amount of mobility. Now they can go live in Plano, Texas and buy a 4,000 square foot home for 350,000 and still be part of that Californian heritage, that part of that California and vibrance that is very hard to finance there.

Mark: The incubator of new ideas and stuff.

Neal: Exactly. So now you’ve got the best of both.

Mark: That’s great. Has anything changed nowadays when you’re vetting new deals?

Neal: Yes. So, I look at five demographics before I start looking at the real estate numbers. My demographics are population growth, job growth, income, growth, home price, growth, and crime reduction. Those are my big five. I did statistical analysis and I came up with a sweet spot for each of those, because you don’t want the numbers to be too high either. Then the area becomes too bubbly.

So, Denver, for example, it’s too bubbly for me, even though it does really well on all these statistics, because it’s too fast, it’s too much. There’s too much home price growth and not enough growth on the income side to compensate. So bottom line is I created those and then I created a course around it and I put it on udemy.com. U-D-E-M-Y.com. So, people just went nuts on this.

There’s a portion in the United States. There was a real hunger for how do I tell the best cities and the best neighborhoods in the United States, in a statistical analytical matter. And I want to also do it in less than 10 minutes. So, I want to be able to pick some random city and say, I want to compare this to the 10 other cities that I know about. And I want to do it in less than 10 minutes. That’s what that course does. It’s called location magic.

And so those five metrics, they still matter. The one thing that has changed is in a post COVID environment today, the way they change. And now the jobs are 50% and everything else is about like 10 or 12%. So, what we’re saying is the biggest factor today is jobs. That is the alpha factor. And so, we’re pointing people to the WalletHub listing, which comes out each month of job losses in cities, Phoenix.

And Phoenix Metro has had the smallest job loss, but Phoenix never really shut down. And hopefully they don’t shut down in the future as well. If they do things cleverly, they’re going to come out on top in the U. S. Because Phoenix Chandler, East Mesa, these areas are still at 7% unemployment rates where Detroit is at 30%. Las Vegas is at 28%. Orlando is at 22. So, what we’re saying is right now for the next year, the X factor is jobs.

Mark: How about your team? Who do you have on your team that you work with?

Neal: I have always believed a company of the future has one third of its employees in the States and the cities that they serve, two thirds of them should be a virtual low-cost workforce. That works our times. Virtual assistants extremely heavily. Mine happened to be mostly in the Philippines. There’s a few in India. There’s one in the Ukraine. And I do not have them work like typical virtual assistants. They’re not hourly. They basically are yearly employees. They work 10-hour days. 9 to 5 Pacific or 8 to 6. So, they work our time.

As you can imagine, we were using Zoom for years. Our company parties are virtual. Our games are virtual. So, we have an astonishing array of Zoom games that we’ve come up with. So, one third, two third mix, where our employees in the Philippines are extremely ridiculously integrated into every task that we do.

People say, “What do they do?” And my honest answer is there is nothing in our company that they don’t do. If you want the token exception, it is that they don’t have access to bank accounts, but other than access to bank accounts, they are a part of everything.

And that gives me incredible 10X-ing my ability to perform, my ability to operate, my ability to grow. Because they’re involved in acquisition and operations in investor management. 80% of investor conversations are being had from the Philippines.

Mark: Is that right? That’s crazy. How did you find these virtual assistants? Do you go through a platform?

Neal: So, I use upwork.com.

Mark: Upwork.

Neal: And if you go type in to the web, luckily, I’m the only Neal Bawa on the internet. So, if you type in N-E-A-L space Bawa space, virtual assistants, you’ll come across three or four podcasts where I’ve spent an entire hour talking about the specifics, so you can take 400,000 virtual assistants and filter down to the top 1% of those. And those 1% are the only ones that we interviewed. A lot of people are like, the quality is not high. No. The quality is very low, low, medium, high astonishingly high, and just unbelievably high. You just have to find the unbelievably high people and we’ve cracked that over five years.

What I care about are people that have worked for five years or more as full-time virtual assistants. And they’ve had at least 10 employers, some of mine have had 10 years of experience as virtual assistants working nights. And I’ve had 30 plus employers imagine they know every software tool that I haven’t even heard of. So, they come with that knowledge. They come with that experience and that training from 30 different employers. How can you get that in the U. S.?

Mark: Yes. That’s hugely valuable.

Neal: It’s incredible. The diversity that we have in our team is phenomenal. We brought people that are doing tech jobs. I have a massive social media presence. Over 40,000 people are being touched. I do none of it really. I do 0% of my social media.

There are people posting as Neal Bawa on everything. They’re communicating. They’re bringing in people. There’s one person who connects 1000 new on my Facebook every week, take this and multiply it over hundreds of processes that you could never afford to do in the United States. And you 10 X, your business.

Mark: That is amazing. That’s great. So, do you want to shift to what I call a multifamily psychotherapy?

Neal: I love that.

Mark: What’s a trait you possess that has served you best both in real estate and in life

Neal: I am fanatic about measurement, here are my mantras. And they’re overlapping mantras, clearly, Mark, you can’t manage what you cannot measure, measure your returns and then measure it all the way back to money. A lot of people measure stuff, but they don’t tie it back to. Okay. How does that lead to revenue? How does that lead to top line revenue? And how does that lead to profit? Measure everything. Measure all the way to the top line and then measure all the way to the bottom line.

So, the second one is data beats gut feel by a million miles. What I’ve seen is I’ve said things as if I was God in absolute belief. And then 30 seconds later in the same meeting, some virtual assistant has shown me something on the Zoom screen that has completely humiliated me. 100%, like I was a million miles off base.

We’re just going to focus on the data and stop thinking about my gut feel because the problem is yes, as you get better over the years, you get more experience, your gut feel gets better. There’s no doubt about that. But I think that gut feel combined with data is so much better than just gut feel.

So those two, I think, are my mantras. And eventually I said, I need a funnier mantra. I need one that’s a little bit funnier than this. So, I came up with this one The Bible, got it wrong by one letter, Mark. It is not the meek that shall inherit the earth. It’s the geek.

The geeks are taking over the world, the top six companies in the world, all trillion-dollar companies are all technology companies. The geeks are taking over the world. So, I collect geeks in my company that are constantly looking for more doors and, and we’re proud of it. And its part of our culture to be geeky. I think that’s the answer to your question.

Mark: That’s fantastic. Are you ready for our question round? It’ll give you a chance to geek out.

Neal: Yes, let’s go.

Mark: And now our question round.

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