Episode Transcript
Speaker 0 00:00:00 Welcome to the Investor Agent podcast. I'm Steve Seymour, your host, where we help transform the human mindset from scarcity and lack to abundance of wealth. One conversation at a time. Welcome everyone. Um, you are listening to the Vanguard Realty Alliance Investor Agent Podcast, where we help transform agents', mindsets from scarcity and lack to abundance and wealth. And today we have Shirley Zoo. Thank you Shirley, for being here today. Um, just wanted to get started. We'll just dive right into it. Um, so why don't you tell me a little bit about your background, how you got into real estate first, and then we'll, we'll take it from there.
Speaker 1 00:00:40 Yeah, sure. Steve. I was really glad to be here today and I started, uh, well, I came from, uh, China so many years ago to attend school and, uh, for graduate school. So, uh, after I graduate and I got a job here, so I worked for the finance company for, um, 10 years. And it's very stressful. It works lots of hours. And my kids were young back then, uh, three and five. So I, one night I saw the commercial and saying, you know, you can, uh, invest in real estate. And so I just hooked down, hooked up, and they said, rang or shine, your rent was coming no matter what. So I'm like, wow, that's something I can do. So, uh, 2003 and I, I left my job and start real estate and start buying rentals.
Speaker 0 00:01:31 That's great. And so how did that, um, commercial, did that come true rain or shine? The rent comes every month.
Speaker 1 00:01:38 Oh, not really. <laugh> my dreams, Steve, um, when I first started and I was just so naive and my dream is to buy 200 single houses and I figured, you know, if you, uh, after the mortgage, all those maintenance, all those cost, and I will net 200 very realistically. And I said, what? Then I'll be so pretty right for 200 houses. And then I, when I get into a graduate, I realize it's not 200 boxes, you know, spit out money <laugh> every month. So you are actually dealing with 200 families and it's 200
Speaker 0 00:02:20 Headaches,
Speaker 1 00:02:20 200
Speaker 0 00:02:21 Hundred problems.
Speaker 1 00:02:22 Absolutely, yes. So I realized and I was like, oh my God. But I thought that's just the way. Yeah. You know, that there's no other way, you know, you wanna make money and that's, yeah. That's
Speaker 0 00:02:35 How you do it. So fast forward, you, you did, you know, you saw the commercial, you made the switch, you got into the single family rental space and you built up a, you build up a nice portfolio, right? Yes. Can you talk a little bit about that and then we
Speaker 1 00:02:47 Can, so I bought, like, I gradually, I bought like, um, bunch of houses and so, and, and then I sold some, so I do wholesale rental and I also do flipping and then average. So I was keeping like 50 ish
Speaker 0 00:03:02 Houses, about 50 50 houses.
Speaker 1 00:03:05 Yes. And so houses, and I think it's,
Speaker 0 00:03:07 And how long did that take from when you started? When
Speaker 1 00:03:09 I first, when I started probably take three, four years.
Speaker 0 00:03:14 Oh wow. You, so you bought that many that fast. Okay.
Speaker 1 00:03:17 Yes, yes. And I was, uh, using all kinds of tools. You know, you buy them, uh, uh, owner finance or you take over the mortgage, you do, you know,
Speaker 0 00:03:28 Whatever, all the different creative finance.
Speaker 1 00:03:30 Yes, yes, yes. Yeah. That's great to
Speaker 0 00:03:32 Scale up. And I'm sure tons of our listeners would love to hear about that. But today we're actually gonna focus on what you're focusing on now, which is real estate syndication.
Speaker 1 00:03:43 Yes.
Speaker 0 00:03:43 So can you just, uh, you know, just to keep it very simple, you know, the first grade definition of real estate syndication so that people understand what that means and what that is.
Speaker 1 00:03:56 Well, syndication, basically you are gathering, uh, well, we see those big buildings, right? Cost minutes, minutes, dollars. And normally, uh, in the past, I think, well, God be those super rich people buying them and has nothing to do with me or, you know, ordinary people
Speaker 0 00:04:17 Didn't seem possible, right?
Speaker 1 00:04:19 Yeah. It seemed like impossible. And then by getting to, and then I learned that you basically, you pull the money together and then, and then in the syndication. So you pull the money together and you pull the manpower together and to accomplish one big project.
Speaker 0 00:04:36 Okay. So it's really what I'm hearing is versus doing one small single family on your own, you're pulling resources, you know, in terms of financing, but also a team together to take down larger projects. Correct. Larger commercial real estate. Correct. And can you break that down as to like, how, how you got into this and then also what you're doing in it now?
Speaker 1 00:04:58 Yes. Uh, so back in 2018, cuz by then I was, has been landlord for guess what, uh, 16, 17 years. And, uh, so I'm just really tired of it. And I thought maybe, let me look around, maybe there's other things I can do. And so I start looking and fly all over attend seminar. And also I tried stock, stock trading <laugh>, and then realized that it wasn't for me. Yeah. And then I look into the business to buy like laundry mat or buy the business or restaurant, and I decided that's not for me. So when a big circle back and, uh, it just feel real estate is still, it's relatively stable. And, uh, and then oh, it, I was just lucky I run into, uh, syndication. And so first, uh, I just start like, uh, tip my toe into it and I invest one project.
Speaker 0 00:06:01 So you started as a,
Speaker 1 00:06:03 As a lp LP as a limited partner? Yeah, as an individual investor. I'm just an investor, invest in the project. And then from one, nine to two and then three. And, and then fr friends asked me, oh, you know, why you been, what have you been doing? And I said, oh, you know what? I am investing in those passive real estate investment project. And they then they said, you know, what about it? I told them what I was doing, what it's about, and they said, oh, we're interested. And so that's when I, um, was said, well, let's, uh, set up something. So I set up a, a club, it's called a Golden Bridge mm-hmm. <affirmative> Club. The club basically is just a place we gather and share information and learn from each other. Yes. So that's how that started.
Speaker 0 00:06:54 That's great. And one thing you said in there, passive real estate investing because aren't rentals passive rental?
Speaker 1 00:07:03 No. If you <laugh>,
Speaker 0 00:07:05 If you, that was a loaded question.
Speaker 1 00:07:06 Yes, that's a good one. And if you are landlord, you know, is not passive at all. And even though, let's say you gave it to property management firm and they managing for you, but you still have to take the calls and, uh, you know, with the larger expenses and you need to make the decision and there's a stuff, uh, they can't handle, they're gonna ask you. So it, it's never passive,
Speaker 0 00:07:35 Never fully passive. Yeah. Yes. And with real estate syndication, I know that's one of the things we were talking about before was that that's what really appealed to you because you're, you're huge on your lifestyle and spending time doing the things you love doing. Um, with, with real estate syndication, that gives you that flexibility and freedom to be able to invest passively.
Speaker 1 00:07:58 Yeah, absolutely. So you have more time, uh, to do whatever you wanted. And for me, I never thought, you know, I'm gonna just retire, rely uh, lie on the beach. It's not my thing, but I think you have the freedom to do whatever you want and, uh, either it's travel or doing the work or reading it, it your time is not limited. I remember one time I was travel, uh, in China up on the mountains and I got a call saying, oh, one of your rental caught on fire. <laugh>. I was like, what I'm gonna do? So I don't wanna ever get calls. Yeah. You know why I'm traveling.
Speaker 0 00:08:39 Yeah. You're enjoying your time. Yes. And then you're immediately taken out of the moment.
Speaker 1 00:08:43 I know you have
Speaker 0 00:08:43 Because there's always something, there's always a problem. Mm-hmm. <affirmative>. Um, with that said, what um, what are some of the things that if someone's looking at real estate syndication, that they, they should, you know, consider, because I don't, I don't believe there's one path for anyone, you know, real estate syndication has its benefits, but it might also have its, um, you know, aspects that are not for everyone. So why don't you dive into that a little bit with, you know, what are the things that you kind of have to give up if you're going to be in the syndication space?
Speaker 1 00:09:16 Yes. It's, if you're talking about on the investor side, uh, I always say it's uh, really there's no right and wrong and method. It's like someone, it's like, like to be in control for everything. They wanted to hear what's going on, they wanted to get involved, they wanna make a decision, and then passive investment, maybe it's not for you. And the, the, this is for passive for people who don't wanna get involved. You are just investor, you just invest in the project. But however, choose a good sponsor team, choose a great project. That's the work you need to do.
Speaker 0 00:09:59 Well, let me just clarify. So what you're saying is in the syndication space, if you're gonna be on the limited partner side as a, just as an investor, uh, you know, think of it almost as like a silent partner where you're not making any decisions but you're deploying the capital. Um, one of the big things you have to give up is being involved in controlling the deal because that's part of it. You're not, you're investing in the sponsor and the general partner.
Speaker 1 00:10:25 Right.
Speaker 0 00:10:26 Right. And with that you're saying make sure you choose the correct, the correct uh, gp. So just for anyone that's listening that doesn't understand syndication, can you kind of break down the, the structure of how they typically work?
Speaker 1 00:10:38 Yes. Uh, in the syndication there's two parties and one is general partner and, and the other one is a limited partner, general partner is the group or the person who does the deals day in and day out. And they're the one to find investment project and they're the one, uh, to get a, a loan, get a, a loan to finance it. And they also, they're the one to managing it and also take it all the way to eventually sell the project. And then the investor side, it just, you just invest in, you bring the capital
Speaker 0 00:11:19 And that's, that's kind of what you were talking about initially is pulling the resources. So yes, you know, certain part, certain people are responsible for the aspect of finding the deal, financing the deal, increasing the value, either selling it or managing it. And, and then the other side of the partnership is really the person, the, the people who bring the capital. And, um, what, so where do you stand on that side of it? And, and why? And you know, just tell us a little bit about your actual experience in some of, of these transactions.
Speaker 1 00:11:54 Yeah. For, uh, for me, and we are on the investor side and uh, cuz um, I was a gp, um, so for certain project and then I realized the, the beginning, the reason that I got into this is to, wanted to be passive on the passive side and, uh, not getting to with a GP part that dealing with, uh, day to day. So now I'm just scared up before you're a small landlord and now you become a big landlord. So, so while staying on the investor side,
Speaker 0 00:12:27 So what, just for, just make that real simple for people. So like you, you specifically just stay on the LP side and you deploy capital, but you also raise capital for, um, for other syndications as well?
Speaker 1 00:12:42 Yes, correct. So before it's me just investing and now we have a group of people and, uh, so we're syndicate I raise capital and let's see, we have teams that we work with, uh, for long term. And there are the, the team we are looking for, they have great track record and they're in the market that we wanted to invest it in. And then we will present, uh, the project to the investor in the club.
Speaker 0 00:13:10 So basically, uh, with what you're mostly focused on is finding the right sponsors and, and vetting those teams and making sure that they have the track record so that you feel comfortable investing your own money and then potentially investing or, or, um, helping other people invest in those syndications as well. Is that really what your focus is? Like your, your
Speaker 1 00:13:33 Yes, it's uh, actually my main focus and most on the capital race site and, and also investor relationship site. And because, uh, we are now with a big platform, uh, it's not just a small company, so it's a big platform and this platform is, it's for capital race. So you will have different teams, uh, those sponsor teams, uh, when I say teams, those are the people who does those multi-families or projects day in and day out. That's their expertise and they will come to the platform to raise capital and then from there on, and then the platform will vet them. And then so there's like, uh, steps to vet them and then once they decided this is a team we wanted to work with, and then they would raise the capital for them.
Speaker 0 00:14:29 Yeah, it's pretty amazing. It's, so you went from watching a commercial about real estate to getting into the landlording space, realizing that it's, it's not passive, it's not all it was cracked up to be. And specifically around your time, I'm sure you did very well financially, but it's, it's, it's time management and, um, and now you've lifestyle train lifestyle Yeah. And lifestyle. And now you've transitioned into the capital raising space, uh, specifically around raising capital for real estate syndication. And with the, with the sponsors that you invest in, what, what type of assets are they investing in mostly?
Speaker 1 00:15:06 Um, majority are multi-families and self storage.
Speaker 0 00:15:11 Okay. Mm-hmm. <affirmative>. And what do you look for in a gp?
Speaker 1 00:15:16 Well, number one, of course it's their track record. And you look at you now, there are so many seminars, you know, to teach people how to, you know, buy multi-family. And so then there are like students and so you don't wanna really invest in someone's deal and they were just starting student students. And so experience in this, it does count. And so we're looking for the, the team who has a experience have taken the deal for cycle means they bought it, they fixed it, and they, they sold it for profit.
Speaker 0 00:15:54 Got it. And uh, how, like, how familiar have you gotten with the sponsors? Because I know for me you're talking about like giving up control and I think I've had interest in syndication, and this is maybe a selfish question, but maybe some of our listeners are thinking the same way. It's like, well, how, how involved do you get in vetting them in terms of, you know, do you physically go out and look at the properties? Do you go out and meet them in person? What, what is your,
Speaker 1 00:16:25 Oh yeah, what does that look like? So there, there's like a several steps. Of course we'll meet in person, so the team will come and will meet with the team and to see whether there is a chemistry. But that's, uh, only the side first of we'll do is what investigate the company. And so we, we use third party company to do that and make sure they're legit. And they also will do round the, uh, re background check for all their key principles like the c e o, cfo, F O for that company and make sure they're, the, the main thing I think for investor, for myself and for all my investors is you worried, you know what, if you have somebody, you know, talk about a big project and then took your money wrong? Yeah, yeah. So we do that and if we pa if they pass the background, and the second thing is we hired third party to underwrite the deal and um, they're not gonna underwrite little, uh, with very detailed, but they wanted to, to see the deal, whether it's within the guideline, right. For, for example, a certain area, uh, let's see, Phoenix, uh, if there are rent growth is only 5% and then there are things that they're projecting 10% and then, you know, it's
Speaker 0 00:17:51 Not realistic.
Speaker 1 00:17:52 Not realistic. Yeah. And so if they pass that, then the third,
Speaker 0 00:17:57 So you're kind of looking for red flags that Yes, that could be, you know, indicators that the deal might not end up looking like they're presenting it.
Speaker 1 00:18:06 Absolutely.
Speaker 0 00:18:07 It, it seems like that's very, that's uh, an overlay from if you were evaluating a multi-family deal because a lot of property owners will, you know, deflate expenses and inflate, you know, they'll, well the, the incomes usually is what it is, but they'll usually reduce expenses or not necessarily account for CapEx or things that are they're aware of. And just like a GP syndicator, they might make the deal look more appealing than it really is to entice investors. So that's kind of what I'm hearing is you're looking for those kind of red flags to see if people have the track record to prove it, but also being very like, realistic in their projections and, and giving you accurate data.
Speaker 1 00:18:51 Yeah. Realistic, that's the word. That's the term you wanna, cuz every team when they want the money and they of course they present the best.
Speaker 0 00:18:59 Yeah. The, the 30% i r yes.
Speaker 1 00:19:02 You know? Yes. You know, it's like all sunshine and the, and then choose, so then you wanna look for Yeah. Whether that's there are too optimistic.
Speaker 0 00:19:10 And what are some of the markets that you feel most comfortable investing in real estate syndications?
Speaker 1 00:19:16 Well, we wanted the market, it's number one landlord friendly and the, and then, uh, the second it's um, the, the area has to have job growth and, uh, population grows and cuz those are work investing in the housing, right. So you wanna, uh, it doesn't mean the Midwest doesn't make money and uh, but if you have a choice and why you wanna bother with it. Personally, I, I'm thinking, uh, yeah, I wanted to invest in those states that's their population has been growing in the past 10 years instead of, uh, in the states that they've been losing population.
Speaker 0 00:19:59 Right. Okay. So you're looking at population growth, job growth, and then, um, landlord friendly states. Yes. In terms of the policy and mm-hmm. <affirmative>, you know, the landlord's ability to, I guess, I guess one of the big concerns would be like rent control or, um, a landlord's ability to evict, like, you know, in certain scenarios mm-hmm. <affirmative> where they could get stuck with projects that mm-hmm. <affirmative>, um, may not be able to turn the project quickly because if the tenants aren't paying or something of that nature. So, um, so anyone like that's interested in getting into the real estate syndication space and all this kind of sounds pretty new to them, what would you say are some of the first steps and then do you have some options to help them?
Speaker 1 00:20:43 Yeah, so first you probably wanted to learn, you know, learn about, uh, this area and to join the group, uh, you know, to, to watch like how they presented the project and then to see the result. So that's what we have this, uh, uh, club. So I, uh, was sent out the, cuz there's, uh, with the Costa was a team. We, we now have, uh, 13 projects and there's two, it's one full circle and it's already sold. So currently like 11 is going on. And then each team has monthly report and I will just send it out to everybody in the club. Uh, you joined, uh, you participate in the project or not and you should just read it and learn about it.
Speaker 0 00:21:34 So they get to kind of almost watch and see these projects taking place and, and what the end results look like. Mm-hmm. <affirmative> even if they haven't invested in them. Yes. Just by being part of your club. Yes. That's that's great. And what is it? It's called Golden Bridge.
Speaker 1 00:21:47 It's called br Golden Bridge Investment.
Speaker 0 00:21:49 And how does someone become part of that group?
Speaker 1 00:21:52 Uh, we have, we have, we have a website called uh, golden bridge investment.com and they can just hop on the, uh, website and click join the club.
Speaker 0 00:22:02 Okay. And if you're, um, do you have to be accredited investor to be part of the, the club?
Speaker 1 00:22:09 Not necessary. Cuz we do have project that will accept non-accredited investor. Okay.
Speaker 0 00:22:16 Yes. So And what's the website again?
Speaker 1 00:22:19 Uh, golden bridge investment.com.
Speaker 0 00:22:22 Just wanted to get it out there. One more time for people. Uh, any, any closing, you know, things that you want to share about real estate syndication or anything that we talked about?
Speaker 1 00:22:34 Yeah, I, I think it's a passive investment and it's real estate. It's, it's a great way to help you to, uh, to accumulate, accumulate your wealth. If you look at the stock market, I think a majority of, uh, people now, or your assets in your 401k and within the 401k, they're all stocks, bonds. And in your portfolio you need to have diversification and you need to have real estate. And the, if landlording is not your thing, maybe syndication real estate, you can take a look at it.
Speaker 0 00:23:10 That, yeah, that's, I think that's such a key thing is, you know, I'm a huge proponent always telling our agents, it's so important you guys sell real estate, start investing in real estate. But a lot of them quickly realize, oh, the landlord in game is not as easy as I thought. And we've, we've looked at, you know, how what are other avenues and pathways that we can help empower them to create wealth and real estate and syndication is one that we're looking at very heavily and encouraging. So, um, just a, a couple more things that I have questions on. I I, I want to, maybe I'm circling backwards, but can you share how many, um, units that you've essentially participated in and or approximately if you're not sure in terms of
Speaker 1 00:23:54 I'm not really sure because all the project that we invest in, they're all large projects. Yeah. Like one project is 300 units. Yeah. So, uh, 400. We just did one in Phoenix, it's a 460 units. 460 units. Yeah. So now in, in East coast, like, uh, where we are now, you don't see many community like that. But in, in southern states, Texas, Austin, Phoenix, they have lots of those community big ones.
Speaker 0 00:24:24 And do you, do you have any idea how much capital you've raised since you've started doing this?
Speaker 1 00:24:30 I think a lot. A lot. <laugh>? Yes. A lot. I, I, uh, in our club and I, before I thought most investor would be the one who has w two jobs, don't have time to do landlording. And, uh, but now, uh, I'm looking actually, uh, 40% of investor, they're all landlords. Yes. And
Speaker 0 00:24:54 They're looking for an easier pathway.
Speaker 1 00:24:56 Yes, yes.
Speaker 0 00:24:57 Yeah. Cuz as a landlord, it's a great, you know, over the past few years, at least, maybe not right now, but would've been a great time to refinance, take advantage of that appreciation and equity, um, and low interest rates, and then redeploy that capital into real estate syndication. Um, you know, so that's always a great option. Do you mind sharing just a, like two more things? Do you, do you have a, do you have a mentor or did you have a mentor in real estate? And what, what does that look like?
Speaker 1 00:25:26 Yeah, mentors always important. Yeah. I still have a mentor. Okay. And we have monthly or weekly, uh, meeting, but it's a group mastermind group and I, I never believe you, you know, you should be on your own and it's, there's always people, uh, they can share the experience, uh, and teach lead you to the right path.
Speaker 0 00:25:48 And then, um, do you, do you have any courses or books that you can recommend for real estate syndication?
Speaker 1 00:25:55 Oh, there's a tongue of them. Uh, on top of my head I don't remember any. Okay. But that I can share with you later.
Speaker 0 00:26:01 We'll, we'll, uh, we'll follow up with you on that and post that in the comments. Mm-hmm. <affirmative> Charl Shirley's recommendation for training. Um, so thank you so much for being on today. We really appreciate it. Hope, hope this was valuable for the listeners and that you guys got some really good content and information. If they are interested in reaching out to you about real estate syndication, should they just go to your website or is there any other way for the,
Speaker 1 00:26:23 Or they can just call me. Yeah, they can just call me. Um, and,
Speaker 0 00:26:27 And we'll post your phone number in the comments then? Yes. Okay. Mm-hmm. <affirmative>. Sounds good. Well, thank you very much, Shirley.
Speaker 1 00:26:32 You're welcome, Steve.
Speaker 0 00:26:35 Thank you for tuning in to the Investor Agent podcast today. We hope you found it valuable. Please tune in weekly@theinvestoragents.com.
