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Real Estate Investing School Podcast
229. How to Own Your Investing Market
00:43:56
Welcome back to the Real Estate Investing School Podcast. Today, we have an incredible conversation with Ty Thorne, an experienced investor and founder of the Kansas City Headquarters of Vivint. Ty shares how his unique upbringing and seven year...
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- [00:00]
Tyler Thorne
Just from the background of business and how much we looked at stuff and the financial acronym, we talked about the home. And then what I do actively commercial assets made a lot more sense to me than the single family ones.
- [00:14]
Joe Jensen
Welcome to the Real Estate Investing School podcast. I'm your host, Joe Jensen. Our guest today is Tyler Thorne. Now, the reason I'm laughing and why I'm so excited about this podcast and is this is our third attempt at recording this thing. The world and the Internet and technology has been against us, but we're finally going to make it. Welcome to show Tyler.
- [00:38]
Tyler Thorne
It's good to be back, right?
- [00:42]
Joe Jensen
Good to be back again. Third time. So Tyler, you've been. He's been doing direct to home consumer sales with Vivint for seven years. He's the founder of the KC Decentralized headquarters for Vivint five years, investing in value add and development of commercial and multifamily assets. He's also the host of the Money Game podcast everybody should check out. He's done eight deals in the past six years, all while running and building his active income through his sales empire. Anyway, we're stoked to have you here, man.
- [01:16]
Tyler Thorne
Dude, happy to be here, man.
- [01:19]
Joe Jensen
So, yeah, we can dive into it. Hopefully the technology holds out. This time we get through the whole thing. I'm a little late because I was getting ready to do this and then My daughter, my 6 year old, she's like, hey, can we go on a run? And I'm like, it's pitch black outside. It's like they're already up way past bedtime. They're like, it's Friday. Yeah, we can go for a run. And so we went and did a little jog around the block and I was like, you can't say no to that. You know what I mean?
- [01:50]
Tyler Thorne
No, you gotta, you gotta take those moments, dude.
- [01:54]
Joe Jensen
I love seeing them be passionate about their fitness and being active and exercising. They don't know that's what they're doing. They think they're playing, but I love it. So that's way cool. Do you have kids? How old are your kids, Tyler?
- [02:07]
Tyler Thorne
Yeah, so I've got two kids. Might have been down for a minute. My oldest daughter is. She'll be 2 in January and then we have a new baby that is like four months.
- [02:19]
Joe Jensen
Oh, nice. Just brand new. Brand spanking new. That's awesome, dude. Well, congrats. Well, sweet, man. Definitely a busy man then with, you know, newborns and two year olds and your sales group. But you're still investing in real estate. I'd love to. I want to dive into your story. You've actually kind of got a unique beginning to, you know, how you got introduced. A lot of people, like I love the origin story, like how'd you get, you know, how did you start seeing real estate as an investment? And so many people, you know, they, they read rich dad, poor dad, you know, they talked to somebody in college or you know, whatever. Yours was a little different. Tell us about your upbringing and how you were exposed to this kind of stuff.
- [02:59]
Tyler Thorne
Yeah, I, it's funny because, you know, as we've gotten into a little bit, I didn't realize how unique my upbringing was really until I stepped away for many years from home and you know, mission and been living away for eight years. But my, my dad's core business, he's an entrepreneur and his business for the last 30 years, he's kind of the guru behind the gurus. So all of the biggest guys in real estate coaching are stock trading, flipping homes, Tark, Musa, Dean Graziosi, Charles. He's got, you know, Cardone's hit him up. Like some of these guys that are, that all of us know he does their books and he's just been in that coaching development, self education space forever. So our conversations at home as a kid have always been super unique and the background, the reality of the education space and these masterminds and groups and just whatever you can actually think about, you can go get it done. And obviously all those guys investments, kind of the key point there.
- [04:07]
Joe Jensen
That's cool. So these, these names that a lot of inspired a lot of people. Those are just like around the dinner table for you guys. Sometimes not even the name, the actual people.
- [04:17]
Tyler Thorne
Yeah, no, it's, it's interesting and I definitely just being younger and we lived in the Midwest world so obviously these guys are Phoenix, Malibu, wherever they're at. But yeah, these are people that my paradigm, my lens as a kid was meet like humanizing these ultra big people, these accomplishments because they weren't like way outside our world. And these were people that my dad was working with and these books were coming in and out of our home and he was running a big business and doing these things. But this was just like my dad, you know, your, your dude that sits at the dinner table that is a punk and like you're super close with and you, you ride each other and so those things didn't feel impossible from the get go.
- [04:59]
Joe Jensen
That's so cool. I love that. Like I said, just the normalizing of it. I think that a Lot of people are still trying to do that with like, just kind of where they talk about changing your thermostat. You know, it's like if all you know is this, you can't really like, get it above that. But if you raise that thermostat, like, no, there's a whole nother level that's possible. I. I love that. Just normalizing what's bigger. I was actually watching some of your podcasts and some of your Instagram, and you were driving through this neighborhood of these like multi million dollar homes, and you're like, yeah, I like to do this like one. It's cool to like, have a vision of like things I can have, but. But I like to just see how many homes there are, how many people do. It's like, it's so doable. It's not like this weird, unique niche thing. It's like there are. There's so much success out there. It's so doable, dude, that.
- [05:50]
Tyler Thorne
That's one of my favorite activities, doing that with homes. And then I tell this to my sales reps all the time. And it's been such a big investing thing for me.
- [06:00]
Joe Jensen
It's.
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Tyler Thorne
We get so bottlenecked and we think that, you know, there's. There's one vehicle especially, you know, certain companies preach this, dude, there's a million ways to make a million bucks. Like, there really is.
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Joe Jensen
Yeah.
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Tyler Thorne
And it's. It's more about like, who. Who are you gonna have to become? What circles do you need to be in? What rules do you need to play by? But like, so for me, that. That's a big activity in not even just homes. This is something I tell all my sales reps over and over and over again. Like, just the, the abundance of understanding how much economic success there is and how many lanes there are. And it just is about becoming somebody. I'll do an activity out. You know, look at the wall, look at the paint. You know, just describe every physical thing you can see. Mirrors, stop signs, lights, fencing. You know, any physical thing you can see. Somebody owns a company making millions of dollars selling that, like that, that random thing.
- [06:54]
Joe Jensen
Yeah, that's so true. I always, I always think that I'm like, somebody's making a fortune off of paper clips. You know, it's like, yeah, yeah, I love it. And the same thing's true with real estate specifically. It's like there are so many different ways to do real estate, from dirt from, you know, just land to mobile homes, to trailer parts and, and self storage to, you know, single Family homes to luxury stuff to flips and short term midterm commercial syndications. Passive. Like there's so many ways to do it and it's like they're all right for somebody and it doesn't really matter necessarily. So what was your kind of first intro to do it? Because I know now you've been doing some commercial stuff and like more like funds and things like that. But what was your, what was your initial, like, what was the first deal? Because you kind of were raised in this world of building your dream and, and real estate was obviously a part of that. But at what age did you actually like pull the trigger and start playing in the game a little bit?
- [07:55]
Tyler Thorne
Yeah, so I, I got in as, as soon as I could. I bought my first property at 22 and it was, you know, two years after I had started my sales career and I came back, you know, I had obviously Dean, you know, he original. Now he's everything. But originally he was a real estate guy. Dean, grab the other real estate book. I'd read all his stuff and I'd read all the grants and I, you know, I did everything that you, you can do without actually doing the transaction.
- [08:27]
Joe Jensen
Right.
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Tyler Thorne
And it's funny because I have a lot of people I could have reached out to, my dad being one and been like, I'm going to do this. Walk me through the steps. But I was pretty prideful and to a fault, like still in a lot of ways am, but in this moment, extremely. And I was like, dude, I can do this on my own. Like I'm earn my stripes. So. So I just did the whole freaking thing solo. And there was definitely some hiccups along the way of the way that I executed it. I ended up, you know, offering before I qualified and had to figure out how to qualify after I offered. It was like super stressful for, for a moment trying to get everything to work out. But it did. And luckily, you know, it was a great property, was a great investment.
- [09:12]
Joe Jensen
So I love that. One thing I love about real estate is it's so forgiving, right? Because you have these due diligence. You have this escrow period where it's like you got it under contract, you weren't even qualified for a loan yet. But it's like, but that's okay. You know what I mean? You can do this next week and the next day. You can do it out of order and you can do it clumsy. And I think that's one reason why it's so attractive is it's so forgiving. That you can get your feet wet even imperfectly when you know, some businesses are not like that. Like, if you jump in messy like you, you could really get hurt, you know. But. But real estate's pretty forgiving. So you bought what. What kind of deal did. What kind of asset did you buy?
- [09:53]
Tyler Thorne
Yeah, so I just bought a. I'm not a handy person at all. So when I started looking at deals, you know, I knew from the get go, hey, I'm not going to be the guy that can come in and buy some old thing that I'm going to value to paint, do walls and all this crap. I'm like, there's no freaking chance I'm doing that stuff. So I bought a new construction townhome. But I had looked at the numbers every single day. That was part of my routine. I put in that I wanted to get familiar with the numbers. So, like, I had looked at every sale in this area for months. Came up, and it was a person. I didn't know why it was lower, but I just knew it was lower. Called the realtor. They were like, yeah, this guy bought it. He got transferred, like, emergency transferred. But all of the new units were selling for like 30 grand more than he was asking because he just wanted to undercut the new builds out so he could just get it done. And I just went over there that day, offered, pulled the trigger. Like, just sent it, love it.
- [10:57]
Joe Jensen
Well, and that's so cool. Like, you said that because you are aware of the market, like, when the right deal comes along, it's not like you're just blindly throwing in a, you know, an offer. It's like, no, you knew, but the moment you saw it. And I remember having deals like that too. Mark's. I've been looking at, looking at, looking at the deal comes along. I remember when I was sitting on an airplane and I'm like, yep, put an offer. And I like, I got it. I was like, message my agent right after she emailed it to me. And I'm like, yep, that's the one. Like, I know because I've already been looking at this market for so long that it's like, just do it. And, and then when you're at that point, it's like. And if it's. If there's things you don't know and it's not right, you can still back out. But. But, you know, it's like close enough to like, at least go get it started.
- [11:44]
Tyler Thorne
Oh, dude, for sure. I think one of the things, you know, I had somebody ask Me for my sales career. You know, I was presenting at a college the other day and you know, like, what's one of your biggest takeaways? And honestly, one of the things I, you know, I said I've done a lot of things outside my career from an investing standpoint. They don't actually have to do with sales. But I'm super grateful. There's no way to learn how to sell somebody other than just go pitch. Like you have to just go pitch and you figured out along the way and that kind of just like led into investing. Like, dude, look, I'm studying everything I can, but I'm just going to try to mitigate the levels of danger to where I can just go try and then go back and find the information and then go fix it along the way.
- [12:29]
Joe Jensen
100%. I think that that really never stops. I think that's how you grow in real estate. In fact, tell us how you did that. So, you know, you started with this little like townhome. You kind of house hacked it, you know, had roommates in it and whatnot. And, you know, just, you know, have them help cover the mortgage and like, cool. I got into a property. But now you're doing like multimillion dollar commercial value add stuff. You know, you're still not swinging a hammer painting, but you are doing the value add stuff now, but on a much, much larger scale. And I think a lot of people want to do that. They're kind of where you started. Maybe they have two or three, but it's still the same thing. And they were like, man, how do I get into those multimillion dollar deals? How did you do it, man? Like, how did you bridge that gap and get there?
- [13:18]
Tyler Thorne
Yeah, you know, I think a lot of people have different ways that they can play for me. Obviously, you know, I super uniquely blessed with the background that I have, my dad, and so that's not his core business. But being behind these guys, obviously he was super financial. Like, his financial acumen was incredibly high across the different sectors. And he'd done a handful of deals. He had a brokerage at one point doing a bunch of different stuff. And so he just has all these relationships, but he didn't have the time. And it was never like a key focus of his to do these commercial asset deals. But as he's gotten older, he's gotten more time, he's kind of downsized his business. And I got to the point where in my active income and the things that I was doing away from home, I was sufficient enough you know, making a couple hundred grand a year at this point where I base. I just went to him and I was like, look, dude, I want to come play in this arena. Give me a time. Every Friday, there's all these people out there that, you know, you could get mentors, like, you know, this stuff. Like, let's play this game. But like, for real, let's play this game. I want to come meet with you. I'll meet with the brokers, I'll do the legwork, I'll do the crap you don't have time to do to earn the right to be in the room. And, and I'll put my name on the line. Like, I'm not putting my money behind. I'm like, dude, put my name on the sheets. Like, let's put my financials against it. Like, I'll play the collateral too.
- [14:53]
Joe Jensen
I love that.
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Tyler Thorne
And that was when he kind of. We started meeting and meeting and meeting and he realized, you know, we would sit down and he'd give me. He just has a huge deal flow that he never gets to.
- [15:06]
Joe Jensen
Yeah.
- [15:07]
Tyler Thorne
And I would just go follow, I would go hunt those down, I'd go walk the properties and I'd go look at a ton of stuff in. Honestly, just from the background of business and how much we looked at stuff in the financial acumen, we talked about the home, and then what I do actively commercial assets made a lot more sense to me than the single family ones. Yeah. Just it's a business. It's a business that's tied to a physical place. But there's balance sheets and there's income statements and rental. You know, there's a lot more financial statements to it and you can, you can force appreciation by enhancing the business, not by knowing the neighborhood necessarily.
- [15:44]
Joe Jensen
Yeah. And that's one of the things that I think is so amazing about commercial real estate. Whether it's literally like a. A business or whether it's just a multi family with five or more units, you know, but is. Is you can manipulate the value of it by based on the net operating income, you know, if you lower expenses and raise income from raising rents, all of a sudden the asset, the physical building is now valued more. You know, if your townhome that you first bought, if you raise rents on your buddies, $100 each, the value of the home didn't change a penny, you know, but with commercial, it's like you raise everybody's rents and get a cheaper contractor to do your handyman work and make some utility improvements, and all of a sudden you just created a million dollars worth of value out of thin air. Which is like the coolest thing about how they value commercial. Yeah. Which is just amazing. So. And that's obviously, you know, something that attracted you to it.
- [16:44]
Tyler Thorne
Yeah. And I think everybody that I looked at from, you know, his world and then I'm just, I'm always digging into these ultra people and then looking behind the scene of what have they been doing once they've got their course and they've got the active income. And at the end of the day, the in play that everybody was doing wasn't doing little single family flips. Like that might be the active side. But everybody was allocating the excess cash flows into these commercial type assets. Multifamily storage, you know, commercial, retail, whatever it is. It was assets large enough that you could buy management in place and the financial still made self to self to self sustain and not have it be another job. You were buying businesses and that was where it was sexy to me. I'm like, well let's just do that now.
- [17:36]
Joe Jensen
Yeah, well that's what's so cool. Like say you're not managing yourself. It's not even possible. So there has to be the margin to have someone else run the whole thing, which is like I said, that's way more attractive than taking phone calls from angry tenants and stuff like that. So let's talk about how did your first commercial deal go down? Like how did you find it and how did you kind of vet it out? And what was it like actually pulling the trigger on something much larger than this thing? The small residential stuff.
- [18:06]
Tyler Thorne
Yeah. So it was interesting. Before I had gotten in, my dad had did a couple of deals and he had turned, you know, he built like 50 town homes and institutional money came in and bought it off him. And he just, he cleared like it was a good chunk, couple million bucks and it was like two and a half year thing. And so he didn't have time. This wasn't, this isn't like his main thing. But I, as we were sitting down, you know, he was looking for another place to put that. And I was like, dude, I think we could recreate that project in a couple different spots. And I was looking, I was meeting with some engineers and some realtors on like how likely is it we could take these pieces of land and do the same thing. And honestly in that moment of being with brokers, with an agent, it just so happened, literally as we were talking about these deals, the very, very first one that I participated in, somebody had called her while we were there talking about these other deals that we were going to look at this piece of land. We've still actually never done any of those deals. That brought me to this first one, she had somebody, just a distressed seller that really, really needed to get out of something before the end of the year. And it was a local dude. He didn't want to sell to institutional money. She had a lot of institutional buyers, so she needed somebody local. And so we drove out, met with, you know, met looked at the place as a nice older brick, you know, 25 unit deal. And we were able to make a habit. So we did that. And, you know, we looked kind of just simple, like you in a commercial. I said, like when you get something, you get the rent rolls. And we got them. We're like, okay, he hasn't raised the rent forever. There's some vacancy stuff. There's pretty long tenants. He. It was literally just one of these things. He was a single operator. His wife was running accounting. And the math, you're looking at the rent rules. Like, dude, these are way under. We go run the comps. You know, she had like in the crazy thing about it too, you know, I've had a lot of people ask me, you know, this exact question, how are you doing your due diligence? Like your due diligence in these larger assets? Like, I'm not personally like running that pro forma. You know, there's attorneys that'll do that. You go pay. Like we have an attorney who will go do a pro forma who's been private counsel on a reit. Yeah, public reit. And then he's been outside counsel on a private reit. And it's like you can bring in a level team players to these type of deals to play these pieces, and you can just be the leader, the GM of that. And that's kind of like what I've been doing.
- [20:46]
Joe Jensen
I love that because I say when there's enough margin to go around, you can bring in, like you said, the right people, you know, you know, we talked about that on the management side, you know, But I, you know, like said, even on the acquisition side, it's like, if there's enough money to pay the right people, then. Then you can do a lot more effective things in you trying to wear every single hat because you're not going to be as good as someone that's been doing it for 20 years. You know what I mean?
- [21:13]
Tyler Thorne
No, in the reality is, as I've gotten into these, I start studying the Ray Dalios I've been studying Jorge Perez, been studying all of these, the Blackstones. And how are they running these deals and how did they come up in this world? And none of them are doing that. Right. Like it's entire teams, they bring in specialists for each individual piece of the due diligence cycle. You know, we have an engineer we like to use that comes in and runs certain things. We have a great attorney that does certain, certain things. And it's been specialty in that great brokers that you know, bring the deals off like it's. And we have great bankers. The crazy thing, the commercial assets, like the banks will do a lot of the work for you because they want the loan.
- [21:58]
Joe Jensen
Yeah. When I've noticed that even on the smaller stuff, like like if you, the lender wants it to be a good deal because they're putting money into it, the last thing they want to do is put money into a bad deal. And, and so if the lender will go for it, like you're probably pretty safe, you know what I mean? And that's true from the single family little DSCR loans all the way up to, you know, these multimillion dollar commercial loans. Like no one wants to get burned on this. And so it's like, it kind of helps, you know, mitigate your risk.
- [22:31]
Tyler Thorne
For sure. For sure.
- [22:34]
Joe Jensen
That's awesome, man. So, so how many, you know, you've done like eight deals in the past six years. How many of those were like kind of the single family house hack starter stuff? And then how many have been like these commercial deals?
- [22:48]
Tyler Thorne
Yeah, so literally just one. Was the single family house hack.
- [22:53]
Joe Jensen
Nice?
- [22:55]
Tyler Thorne
Yeah, I know, I didn't just kind of was like, dude, let's just, let's do this. So we have two separate 25 units. We did a, like a commercial retail plaza, developed a little neighborhood that were selling the lots. And then we have 100 and like 40 single or build to rent that we're developing right now for units for senior living, 55 plus communities.
- [23:25]
Joe Jensen
Oh cool. Yeah. What a good niche that is man. Like talk about weeding out a lot of the riff raff of tenants. I've been thinking about those lately. Like man, that's like great. You don't have kids, you don't have like, I don't know, just petty things as much, you know what I mean? It's not like people are just, I don't know, they just seem a little more established and a little more responsible at that age, you know, dude, it.
- [23:49]
Tyler Thorne
It really is crazy. And, and just you know, I had somebody ask me like, well, how did you kind of know to do that? And so it's, it's interesting. Like, dude, I grew up in Kansas City. We've lived in this area forever. My parents have lived here. You know, a lot of our professional relationships, familial relationships are here. And so we have like a pretty good grasp of just what's missing and the demographics and the need. But the thing with these commercial assets, like one of ours that we have up, literally all we have on the site right now is like a sign and it's like a wood sign that says it's, you know, 55. And we have like 50 people on a wait list for 40 units.
- [24:30]
Joe Jensen
That's awesome. Zero marketing, like no advertising, just buying out on the dirt while you're building. I love that. That's cool. Because yeah, you, I knew you did like some value add stuff like these mismanaged properties. You go in and make it better. But that's cool that you're doing, actually build, build to rent on some of these. Just knowing that there's that need. What's that like with today's market and the kind of like the economy right now? What's it like building? Has that been a nightmare? Is it actually coming out okay?
- [25:05]
Tyler Thorne
You know, uniquely, we've been super lucky. We are, we're doing super good. We have an awesome construction partner that like, they're actually ahead of schedule. So that never happens. Right.
- [25:20]
Joe Jensen
Are they part of the deal or are they just contracted out?
- [25:24]
Tyler Thorne
Contracted out, Yep. Cool. But we, we've kind of just said like, hey, we'll bring all of this to you. And so they're stoked on it to, to do all of these projects a big part. Just we're super. I'm really, really bullish on the Midwest market. Like we've done a lot of research and just looked at some of this stuff. You know, I pulled some Harvard studies and the age demographic that 55 plus there's more high income and more of that age that's moving into multifamily maintenance free units.
- [25:55]
Joe Jensen
Yeah.
- [25:56]
Tyler Thorne
Because the affordability rate to go into the same level of living in a new single family just isn't there. And there's the safety component too, just in today's world. And then same thing in the younger demographic, but the income is increasing of people going to multifamily. It's weird. And they don't expect it to change. But the land in the Midwest, comparable to the rent ratio is still pretty cheap. And so when you're developing that obviously, you know, I was telling somebody the other day, it's, it's a super unique process to like actually acquire the land, then get it zoned and then, you know, get it reappraised with the new component of what it's actually now capable of being just like a value add. When you renovate some stuff, you can get some value pushed in there. But that land can, you can explode the valuation of it when you now create. This isn't just dirt here that was maybe going to be some homes. Now it's, it's a performing space for a business that is going to create, you know, impact for this area of the city.
- [27:01]
Joe Jensen
How do you make sure that you're able to rezone it and get the, get it to be approved for what you need it to be? Like I've heard that you can actually put that in your purchase agreement. Like hey, contingent on us getting it zoned or whatnot. Because you don't want to go buy a ton of land and be stuck with something if you can't use it for what you intended. How do you vet that?
- [27:24]
Tyler Thorne
No, you definitely don't want to do that. And we, I actually, I have a funny story on that. So this is, this is a good example and this, this is just how we do our due diligence. I think everybody's different. I was looking for a storage deal and there's a local city that there's like the city just, they won't rezone anything left for storage. But I had found that there's one part left in the whole city that's still zone. And this is an exploding area. There's a ton of like it's super, super needed. It'd be great. I get ahold of the guy who owns it, it's not on the market, we go check it out and he already has the designs to do the whole thing. Like it's ready to go and it's already done first, it's already zoned. But the problem, the caveat was we know that this city's pretty particular and you need a specialties permit. And so we said, hey sweet, we'll do this. But in, in our offer, like same thing, we said we want 120 days pending that we get the specialties permit. If we don't like, dude, there's just no way. Well they just took it and somebody else undercut and said I don't need that. And we just weren't willing to risk that. And this other person did it. Like I don't know, I don't know their story. I know they own a lot of storage in the area, so it might have just been their hedge of we just don't want anybody to play in our arena and we'll eat the loss if we can't. But it did work out because I drive past it every day on the way to my Vivint office and it's going up. So they pulled it off. I laugh about it, but, you know, it's still a good principle. There's always another deal out there. There's always another deal. And if it doesn't feel right, like, you know the number one rule in these big, big deals, like, you just can't lose money because you could get yourself in a hole quick.
- [29:15]
Joe Jensen
Right? So. So you presented this offer with the contingency on getting the special permit. They accepted the offer, but they're not. It's not like residential, where they're required to honor that they're able to take another offer. Even if they're entertaining yours, they're not locked in.
- [29:32]
Tyler Thorne
Yeah.
- [29:34]
Joe Jensen
Well, that, that's, that's, that's too bad. You know, it's nice that you can just have it locked in. You know what you're getting.
- [29:42]
Tyler Thorne
Yeah. And it's there. There's definitely. I think in the bigger arena, there's. There's some nuanced stuff, but there's also. There's just. There's so many opportunities.
- [29:56]
Joe Jensen
Yeah, I love that. That mindset that you have where it's like, yeah, like, just get a different deal. Like, it's not the end of the world. I have this phrase I tell myself when I'm buying deals. It's like, it's one of a hundred, you know, so if it falls through, who cares if I get it? But it's not the perfect asset. Who cares? Because it's really easy to like, second guess yourself. Like, was this really the right deal I should be doing? You know? And it's like, what if there's a better deal? It's like, yeah, there better be a better deal because this isn't my last deal. Like, like, it's one of a hundred. And it's like, yeah, this isn't the best deal I'm gonna find. And I don' if it's perfect and it might fall through, but it doesn't matter because it's just one of a hundred. And just like, keep that mindset, I think, really kind of just. And for me, it puts me in the right headspace.
- [30:45]
Tyler Thorne
Yeah, it's. Dude, it's It's a lot of fun and we, you know, as we've done more and more of it, we've just kind of developed our own little like thesis and we've gotten pretty good at it and we're targeting, you know, specifically in the Midwest region that want like that five to $10 million range. And the reason is we've realized a lot of stuff past that institutional money, it gets really competitive and they're, they're, they're competing there. But in that sweet spot, it's outside the retail investor. And it's also like too small for the capital allocations for the institutional firms. And so we're able to go in and a lot of these things, these 25 to 40 unit deals or these smaller retail, like commercial shop, we bought a commercial plaza. It's the only thing they own. They're, they're not investors. It was an, it was an accounting play at some point from a separate business. They're usually capital starved, they're under managed, they're under supplied. There, there's a vacancy issue. So there's just a lot of opportunity. Whether that's the, you know, the raw land of who owns it or like what could be done there or the actual assets that we're buying.
- [32:04]
Joe Jensen
And you guys self funding this stuff through like the businesses you guys own or do you guys raise money for these.
- [32:11]
Tyler Thorne
Yeah. So historically we've, we self funded everything which. I know, right? Anybody listening? It's like, oh, you know, nice, right? But it's I think in a lot of these bigger deals, like his income and then you know what I go do on the side, we've been just aggressive and the banks like that. Our active income isn't actually tied to flipping or wholesaling or any of those other things because it's outside the market of what we're investing in. It's just not, it's more diversified if that makes sense. But so far we've done everything. We're super blessed to be able to do that. But we, we are actually launching our first fund and so we're going to scale up and let other people play. Really. Not for two reasons. We've had enough people ask us if they could participate and we also just want to go a little quicker and so we want to, we feel it's a great way to serve and have it, you know, the most professional way to like bring people on into those type of deals.
- [33:17]
Joe Jensen
I love that. So if people want to be able to follow up with this and like invest in the fund or learn more about it. What's the best way for them to like keep in touch or reach out to you?
- [33:28]
Tyler Thorne
Yeah. So we're. This has been my project for like the last year, dude. It's because doing the deals for us is one thing. Bringing in the SEC compliance has been like a whole nother world of. I've been on calls with attorneys and reading books you've never heard of that no one's ever heard of. It's a whole new freaking language. But anyone who like you on my Instagram, you could DM me. We can put you on a list and then we'll. We're going live here in like literally the next five to 10 days. As we're onboarding our administrator and we're actually rolling in. We self funded the acquisition of the land and all these for these senior homes. But we're going to, we're going to roll that in just because we know that everything pencils and for our first phone we want it to be just a really great experience.
- [34:15]
Joe Jensen
That's awesome. So what's your Instagram handle?
- [34:18]
Tyler Thorne
Ty Thorne.
- [34:20]
Joe Jensen
Awesome.
- [34:20]
Tyler Thorne
Yeah, just DM me if you want any information for credit investors. But we'd be happy to put you on a list and shoot you some info when we tee up.
- [34:30]
Joe Jensen
That's awesome. Thorne has an E at the end, right? Cool. And we'll put that in the show notes and stuff too. But I love that. I think it's super cool. Like you said, the more you can grow, the more opportunities there's for everybody else. You know what I mean? You get in this position where it's like people are coming to you wanting a place to put their money. It's like cool if you can solve a problem for yourself but also solve a problem for them. Like how cool is that? You know what I mean? And that's one thing I love about real estate. I say this all the time. It's like it's win, win, win, win, win. Like everybody involved can win. No one has to be a loser at any of it.
- [35:07]
Tyler Thorne
Oh yeah. And it's honestly I think it's more fun to do with people and the. I think everybody who gets in the game enough starts to realize unless you're like you're wholesaling and you're flipping and everything that you do is real estate. If you run another business, you're probably not going to optimize your investment in a way that's like the best way for you and the best return on your experience, joy and dollars. Unless you're Playing with partners, and you're playing in bigger deals that have the economics for scale.
- [35:44]
Joe Jensen
I love that, man. I love that. Well, we. We're gonna get wrapping up here pretty soon. I have a couple final four questions I want to go through, but, you know, is there any other kind of pieces to your story or kind of advice or mindset, things you'd want to share with the listeners that have kind of helped you get where you're at?
- [36:05]
Tyler Thorne
Yeah, two. Two things. One, just the world that I grew up in, I'm. It's just like supercharged me to read and consume information. I'm just a huge, huge exposure is everything. Like, you. You don't know what you don't know. And so just get as much information, read as much, listen to as much of the good stuff. Like, you have no idea what might spark something or who you might fall in love with. Their experience, their route, their strategy or whatever, and light you up. And then the other thing is just. I think the most valuable skill is just understanding you don't have to do the whole piece. Even when I house hacked, like a great realtor and a great lender, they did most of the legwork. I just had to figure out how to get them the information they needed. And a team, especially in the real estate game, like, you've got to learn to just be a facilitator of people. You got to be a team lead. So if you can manage well, like, go play the game without knowing all of the real estate centric stuff.
- [37:11]
Joe Jensen
And I love that concept, and I think so much in this industry, I see people feeling like they do have to do everything themselves. And even if they're bringing people on, it's like they have people doing stuff, but they're really like, running everything, you know, And I love how you're like, dude, if you can just be the coordinator, you know, I mean, like, you just have the vision and just put all the people in the right places that are the right people. They'll do it way better than you. And I just think that's such a. It's almost like egoless, you know, some people. No, no, I don't want to be the man, you know, Like, I want to put this thing together and have my name on it solo. And it's like, that's probably not always the best move, though.
- [37:54]
Tyler Thorne
And I just. I think in real estate, it's just the way the industry and the investment itself works. Every a person you bring into, right, the realtor or the broker, like, they make money when the transaction's really good. The construction team, like, they make money when you keep them busy, and the transaction's good, and the project's good. Like your tenants, like, your property management, your attorney that's involved, your accountants that are involved. Like, all of those people, it's booked into the investment to get paid without you just, like, forking dollars out for them to do good work.
- [38:30]
Joe Jensen
I think that's an amazing concept to end on. I think that's something I could apply a lot better. I want to ask you kind of these final four questions before we go and get your take on it. So question number one, Ty, what's your dream deal or deal you hope to tackle eventually?
- [38:51]
Tyler Thorne
It's funny. So I have literally no idea, right? How. Well, one day I guess I'll know the who. But when I was taking a little river tour down Chicago, just one of those amazing office buildings, I don't even. I couldn't even begin to speculate on what the magnitude of something like that is. But I just think something of that scale and of that mark and for so many people would be so cool.
- [39:20]
Joe Jensen
That would be cool. I've done that. Yeah. Chicago's an amazing city. And like, yeah, seeing those skyscrapers right next to the water going through the city, it's like. It is. It's breathtaking. I love that. All right, well, question number two. What's been one of the most pivotal, pivotal books you've ever read or listen to?
- [39:42]
Tyler Thorne
Best book. It's. It's not even about real estate, but it's Ray Dalio principles. Just the way he attacks. Detail of everything in his life, management to decisions, just methodologies. It's so systemic, dude.
- [40:00]
Joe Jensen
Ray Dalio, that's a rare suggestion, but a potent one. Like, I'm a big Ray Dalio fan. Encourage everybody to go check him out. And. And he. He's cool because he's. He's really many levels deep, right? Like, he understand things on a whole nother level. But what's interesting about his book, at least some of them, he'll have, like, these bolded parts where it's like, hey, if you want to skim the easier part, read the bold parts. If you want to get, like, two levels deep, read the bold and the italics. If you want to read everything, you can read all of it. And I was like, what a cool way to, like, let me in when it was. Some of it got a little heavy and thick and slow, you know, but really interesting approach to it, but, man, he has some depth.
- [40:44]
Tyler Thorne
Wicked smart. Yeah, yeah.
- [40:47]
Joe Jensen
So cool. I love that suggestion. All right, question number three. What's one of the most expensive air quote mistakes you've made in real estate investing?
- [41:00]
Tyler Thorne
Most expensive.
- [41:04]
Joe Jensen
Or interesting or interesting?
- [41:08]
Tyler Thorne
Yeah. Honestly, we've been super lucky, blessed and we've been more precise. I feel like we have more control in the commercial stuff in multi family, to be honest, because it's, it's managing and different things. Probably the biggest, you know, like fluke mistake thing, I. When I bought my very first house hack and I freaking didn't get qualified till after and started to take a one year exemption. I had two cars at a time, just like pimped out Rubicon and a Prius, dude. I had to like liquidate every dollar in my bank account, sell my jeep to go get the down payment necessary and just send it for my first property.
- [41:54]
Joe Jensen
Yeah, I love that, man. Sometimes you just gotta like just go for it, go all in, stretch yourself a little thinner than you want to be, but make it happen. All right, last question. What's a final piece of advice you would give to a newbie that wants to either get into any real estate or get into commercial real estate?
- [42:14]
Tyler Thorne
Oh, man. Any real estate. I think the house hack, I tell everybody I try to get every single one themselves to do one. I think it's. You can almost not mess it up. If you're going to live in it, right? Like it's. Just do it, Just get started, go through it. You're going to see so many things and just doing the paperwork, going through the inspections, going through the cycle, you're going to learn a ton. Anybody trying to get any commercial like team, like you're going to play in those assets. Like nobody's doing those deals alone. Nobody. Cardone is not looking at those deals alone. He's got an army. Yeah, everybody's got a squad.
- [42:53]
Joe Jensen
I love that. That is solid advice. Sweet, man. Well, this has been a pleasure. I'm glad we finally got it to work out and that we're able to connect. I think you add a lot of value. It's interesting to me though. I don't normally interview people three times and it's like, I'm like, man, every single one's been totally different though. Like, I'm like, it's kind of bummer hear all of it. Like we've covered very different. I don't know, it's been so different. Every single podcast I'm like, that's kind of cool. It's never the same. So that was fun.
- [43:23]
Tyler Thorne
A pleasure, man.
- [43:25]
Joe Jensen
Awesome. Well, glad to have you on. And when you get that skyrise next to the water in Chicago, we'll have you on again and we'll talk about it.
- [43:33]
Tyler Thorne
Yeah. If I ever pull that off, we'll invite you down.
- [43:37]
Joe Jensen
Love it, dude.
- [43:38]
Tyler Thorne
Pipe dream.
- [43:39]
Joe Jensen
Love it, man. All right, well, this is Joe Jensen signing off for the Real Estate Investing School podcast on, reminding you to normalize what currently feels out of reach.