Our guest is the author of the fantastic real estate investing book "The Definitive Guide to Underwriting MultiFamily Acquisitions" and we take a deep dive into the art of underwriting! Robert oversees acquisitions and capital markets for Lone Star Capital and has acquired over $100M of multifamily real estate. He has evaluated thousands of opportunities using proprietary underwriting models and published the number one book on multifamily underwriting, The Definitive Guide to Underwriting Multifamily Acquisitions. He has written over 50 articles about underwriting, deal structures, and capital markets and hosts the Capital Spotlight podcast, which is focused on interviewing institutional investors. If you're someone who wants to learn more about underwriting multifamily deals then this episode is for you. We dive into how to get started, vetting deals and making sure you've got the knowledge to succeed. Join our community and improve your investing knowledge completely free.
Our guest is the author of the fantastic real estate investing book "The Definitive Guide to Underwriting MultiFamily Acquisitions" and we take a deep dive into the art of underwriting!
Robert oversees acquisitions and capital markets for Lone Star Capital and has acquired over $100M of multifamily real estate. He has evaluated thousands of opportunities using proprietary underwriting models and published the number one book on multifamily underwriting, The Definitive Guide to Underwriting Multifamily Acquisitions.
He has written over 50 articles about underwriting, deal structures, and capital markets and hosts the Capital Spotlight podcast, which is focused on interviewing institutional investors.
If you're someone who wants to learn more about underwriting multifamily deals then this episode is for you. We dive into how to get started, vetting deals and making sure you've got the knowledge to succeed. Join our community and improve your investing knowledge completely free.
KEY TAKEAWAYS
1. To get started you should research and become familiar with income statements and rent rolls.
2. Take the above information and plug it into a model that will provide you with vital financial data.
3. Underwriting is the financial aspect of evaluating an opportunity. It will also allow you to determine your return hurdles and risks.
4. A key contributor to risk is debt. The more debt, the more risk, and we also want to look at the maturity of the debt. For example bridge loans are more risky vs permanent financing.
5. Look at business plans and ask: How much are we changing the revenue? We can demand a higher return for more potential risk.
6. The number one way people lose out in real estate is because they can't afford to cover the debt service.
7. The main assumptions that you want to get right are the pro forma rents, rent comps, rent growth and exit cap rate.
BOOKS
Start With Why - Simon Sinek
LINKS
https://www.linkedin.com/in/rob-beardsley/
https://www.instagram.com/rob_beardsley
https://www.facebook.com/RobBeardsleyLSC
Steven: [00:00:12] Hi guys. Welcome back to the Investor Mindset podcast. I am very excited. I've got Rob Beardsley in the studio today. How are you doing Rob?
Rob: [00:00:20] I'm doing very well. Thanks for having me.
Steven: [00:00:23] I am excited to have you and one of the reasons I'm excited is because Rob just put out a phenomenal book, The Definitive Guide to Underwriting Multifamily Acquisitions. It's really good. I personally read it. I've been through some training that he's done and I want to share it with all of you guys, whether you're passive or active, there's some powerful, powerful tips we're going to talk about in today's episode. And of course, Rob and his company, Lone Star Capital Group have structured over a hundred million dollars of multifamily real estate transactions. He's evaluated thousands of opportunity using his proprietary underwriting models and he has a super popular newsletter, which I'd recommend checking out. He'll mention how to get on that as well. He's published over 50 articles on underwriting deal structure in capital markets, and he's got the experience in underwriting by doing it over and over and over again, which is what you have to do if you want to get really good at this, whether you're an operator looking to go and underwrite deals and make sure the numbers work, or you're a passive investor wanting to vet the numbers of the opportunities that you're going to invest in. It's an important skill to have, even if we're just talking about it from a high level. So if you're ready to get into things, Rob, let's do it.
Rob: [00:01:35] Lots to cover. Let's do it.
INTRO: This is the investor mindset podcast and I'm Steven Pesavento. For as long as I can remember, I've been obsessed with understanding how we can think better, how we can be better and how we can do better. In each episode we explore lessons on motivation and mindset for the most successful real estate investors and entrepreneurs in the nation.
Steven: [00:02:03] So diving in, if we start out by taking a look back at earlier in your life, what events or influences from your childhood shaped who you are today?
Rob: [00:02:15] Well, that's a deep question to start off. Well, I definitely was really fortunate to grow up in a very motivated and strong household. I was also very fortunate to grow up with stay at home parents that ran a real estate brokerage firm from home. So I would hear them have conversations constantly about deals, business, and so I was just really around adult conversations since I was, I don't know, six years old. And my dad always felt that it was unnecessary to speak to me as a child, that he would just speak to me as an adult even when I was really too young to understand. So I think just being around real estate, being around adult conversations, business from a very young age, really shaped me and pushed me to grow and move towards that direction. So I think that's a big one.
Steven: [00:03:09] I think that's such a powerful concept. The idea of talking to a kid as if they're just another person. They have the ability to process and understand things and it really gives you as a youngster and opportunity to learn very, very quickly and to start having some of these conversations to get those reps really, really early. You're obviously a pretty young guy yourself, you're out here doing big things and I think, I would guess, and I'm curious what your thoughts are, I'm guessing that's probably a big reason why you've been able to do so much in the industry so quickly is because you really started learning a lot younger than a lot of people really do.
Rob: [00:03:44] I think you're exactly right. On top of that, I just carried over that style of learning kind of how you mentioned before learning by doing, I carried that over to everything I was doing, including real estate and networking and learning the business as I just started having conversations with really smart people. And rather than supplicating to them as if they were a potential mentor, I just wanted to have, let's just have peer to peer conversations and maybe, obviously, I always trying to learn something from every conversation. So I think taking that approach and the learn by doing is really powerful.
Steven: [00:04:20] Yeah, that's such a good reminder. It's that energy that you bring to a conversation where you're not feeling like you're looking up to somebody, you're actually looking at them on an equal playing field where you're bringing value and they're bringing value to that conversation. And even if that person might have years of experience, you know that you're still bringing something and you can bring that energy to whatever kind of questions you might have. So tell us a little bit about your background and your primary focus as an investor.
Rob: [00:04:50] Sure. So as I mentioned, I grew up in a real estate family. My parents previously ran a residential real estate brokerage firm in Silicon Valley. Growing up in Silicon Valley, I actually was pushed even though my family was in real estate, my parents pushed me to tech. They said, well, look at all these successful startups around here. You should go and, and start a tech company and that's how you'll make your millions. So I went to school for computer science, but very quickly, I just fell in love with real estate again, and then circle back to it and was pulling on my parents to go with me into multifamily because they had only done single family. Single family brokerage, single family flips, developments. And I just started latching on to multifamily, felt that it was a really compelling asset class and something that I could really wrap my arms around. So I was actually able to not only break into the business myself, but also actually pull my parents behind me as well and get them involved and now they're looking at and have actually exited the brokerage business and are full time real estate, multifamily investors, both passive and active.
So I think that's just a great example of what multifamily can do. To create passive income, to free your time, let you do what you want to do. So that was my kind of circuitous path, but it all worked out and kind of keeping real estate in the family. So today it led me to, a little over two years ago, I started Lone Star Capital with my business partner. And so we now focus on acquiring value add multifamily throughout Texas. We're actually based in New York city.
Steven: [00:06:42] Yeah, absolutely. I love the fact that your teaching and introducing concepts to your parents. And I think there's this whole dynamic when you're a young person and your parents, you've got these ideas and you want to be able to share them with them. And it's so cool to see when they're open. Because they're talking with you as if you're an adult when you're younger and so there are as open to hearing these thoughts and ideas and kind of going down that path with you and so that they can start taking advantage of the opportunities. So let's dive into the book, The Definitive Guide to Underwriting Multifamily Acquisitions. You've got a very, very detailed overview of all of the different pieces that go into a model. So if you are somebody who wants to learn about what goes into underwriting, a multifamily deal, this is the book, this is the book. And I wouldn't say that unless it was the book and it's definitely one that you're going to want to go out and pick up a copy on Amazon. We'll include a link in the show notes for you so it's really easy, but talk to us about where do you start. If you're brand new to underwriting and maybe you've learned some of the basics. You've learned some of, what all of the different concepts mean, but your going down this path of wanting to make sure that you're vetting the deals that you're going to invest in, where do you start?
Rob: [00:07:57] Yeah, you definitely need to have the building blocks of really understanding how multifamily works from an income and expense side of the equation, as well as the capital structure with the debt and equity. So to really get started, I recommend just reading income statements and rent rolls.
So familiarizing yourself with those two key financial statements that are really attached to every single property out there. And you want to understand what the typical flow of an income statement is starting with gross potential rent, with the vacancy and other economic losses and then obviously the kind of the main expense categories like payroll, general and admin, marketing, turnover, familiarizing yourself with all these different income and expense items, and then getting comfortable really with just copying and pasting them into a model. Even if you don't really know how the model works, kind of step one before we go into deeply, really vetting is just, can you literally take the information and copy and paste it without really fully understanding it? Because even just knowing how to do that will really show you a lot. Because the danger is just looking at a model or looking at an investment presentation and just saying, this is the return. This is the return. And not really looking at it for yourself.
So you'd be surprised that without even really tweaking assumptions and just taking numbers at face value, the return might be different than what you expected or what is shown. So that's really, in my opinion, step one is reading the financials and then being able to plug those as those numbers into any working model.
Steven: [00:09:41] Such an important point, because underwriting at the core is really diving in and understanding what are the financial numbers of this deal. And depending on what numbers you're taking and whether you're putting them into the model correctly, you're going to get good data in good data out, bad data in bad data out. So I love this suggestion because, when you look at a financial model for the first time, or even if you looked at it a hundred times, it's going to look like a foreign language when you're first starting out. But the more times you look at it, and the more times that you take that information, you're actually going to focus in on it. You're going to really actually take the time to start, does that number make sense? Is that number is similar to other numbers that have been in this expense category in the past. Is there anything else that you'd add to kind of like what the intent and what the definition of underwriting is, Rob?
Rob: [00:10:33] Yeah. So underwriting is, as you mentioned, really just the financial aspect of evaluating an opportunity. So what I like about underwriting is it is an art, so there is some gray area to it, but I like how largely it is black and white. You can really see the returns on the screen. If you did everything right, then you should have confidence that you are making the right decision.
So at the end of the day, underwriting is a, go, no go decision maker. So with all that effort, all we're really trying to figure out is, do you buy the deal? Do you not buy the deal? And also it can help you determine what price to buy the deal at.
I think another important aspect of underwriting is the risk, and being able to factor in risk into your underwriting is extremely important because we don't just buy deals blind to risk. We obviously care if a deal is riskier than another deal.
The way that we choose to factor in that risk is obviously we'll take into account the risks that we can see, if there's higher vacancy, obviously we're plugging in higher vacancy, but going a step further, we're also demanding a higher return for a riskier deal. So that is another key element of underwriting is not just being able to derive projected returns, but also to be able to understand, what are your return hurdles? So getting really clear, and that only comes with practice and being able to underwrite hundreds of deals to see really kind of the bell curve of returns based on different deal profiles.
So yeah, I think that's a really important piece. We've actually created a matrix of return hurdles that if a deal looks like this, if it's in this kind of market with this kind of business plan and this kind of debt structure, we classify it as a certain type of risk and we'll assign a corresponding return.
Steven: [00:12:22] What are those different types of deal structures and how do you go about assigning risks? Because I think this is a really big point. Sometimes people look at investment summaries and they see, Oh, well that's got a 20% return. The people must be thinking the same way. That must be a high risk deal. And other people might look at a 12% return and think, Hey, well, it's just not high enough, but how are you actually figuring out like what's the risk versus the reward, and how do you end up putting that into your model?
Rob: [00:12:54] Yeah, absolutely. So for us, some of the key contributors to risk would definitely be debt. So less debt, less risk, more debt, more risk, and also the maturity of the debt. So kind of a popular topic are bridge loans versus permanent financing. So there's no way around it.
Bridge loans just are more risky because they have a shorter maturity. So you're up against a clock that could be 24 months. That could be 36 month clock. Whereas, in a 10 year loan scenario, you have 10 years to really execute the business plan, create value and amortized down the loan balance. So it really is a far lower risk scenario then going in at a high leverage point, all interest only payments and a 36 month maturity. So to us, we definitely delineate bridge loans versus non-bridge loan deals in terms of risk category.
So just kind of throwing a number out there, I would probably say something like, you would want to see a 2% to maybe even 3% premium and your projected return if you're using a bridge loan versus not. So that's one big example.
Another big example is actually the business plan. The way that we look at business plans and kind of delineate risk measures is, how much are we changing the revenue? If I'm buying a property and as a million dollars of revenue, and I'm projecting to double it, $2 million, I would consider that to be quite a bit of execution risk. And we would demand a much higher return for that sort of risk because if we go in with the business plan of getting from $1 million to $2 million and we fail, we want to know that there's cushion there so that we don't fail hard. We want to still be protected.
Whereas if I'm buying a property with a million dollars of revenue and my business plan is just to move it to $1.1 million of revenue, that I would consider more of a core plus opportunity, far lower risk, the execution there is not difficult. And if I fail, my returns are still probably going to be 90% there. So that lower return, like you said, 12% return for a deal like that would be great. But some people who aren't really used to evaluating deals with return and risk taking into account that like you said, just say, Oh, too low, I'll pass.
Steven: [00:15:24] Yeah. I've definitely experienced that myself, talking with different folks and some people look at, that are more maybe a retail investors, they might think to themselves, Oh, well, that's a 12% return. That must be really risky. You talk to other retail investors and they think, 12%, I wouldn't even get out of bed for 12%. But they don't realize that you need to look below the hood in order to understand, like, if I guaranteed you to have 12% return, that's a pretty low risk. And in this world it's difficult to overuse the word guarantee. However, when it's really, really low risk, it's as close as you can get. But if it's something where you're going to double the income of the property, you better have a higher return. And sometimes it might actually need to be much higher than some of the returns that we're seeing out there for people who are doing those really, really heavy value add type deals. So I think that's really powerful for people.
Rob: [00:16:20] Add a quick point on top of that. You bring up a really interesting idea, which is, let's say you have investors that are accustomed to a certain level of return, let's just say 15% or even 18% is kind of what they have in their head as that's a good deal for them and that's what they are looking for. Well, like you said, what if I go after a really heavy value add that really should garner a 25% return just because of the level of risk I'm taking, but I'm paying a little bit too much or what have you, and so it's only an 18 or a 15, but my investors, since they're not really seeing the risk clearly, they don't really know the difference. They just see, Oh, here's the next deal, and it's a 15 like always, it's a good deal. But it could be drastically different than the low risk 15 versus the high risk 15. So we would consider that a poor risk adjusted return. So we have to be cognizant again that the return corresponds with the risk.
Steven: [00:17:19] I think it's really important for operators to remember and keep this in mind that you need to protect your investors. So if you've got a deal and they'll be happy with 15, but it's a really risky deal. You can't be offering that at 15. You need to find a way to make it work. But on the flip side, as an investor, you need to really get to understand what that risk is and not be afraid of taking a lower return if it's lower risk, if that does fit what you're looking to do and just be cognizant of that. So super, super powerful. Let's talk a little bit about how important reserves are and how do you look at underwriting reserves in order to kind of balance the risk that you're looking at in a deal?
Rob: [00:17:59] Yeah, absolutely. So again, I'll bring this back to bridge loan versus permanent debt. So our standard, if it's agency financing, let's just say fixed rate 10 year loan, I would consider that to be lower risk. We would go in with one month of expenses and debt service. And that would be our reserve that we just are holding in the bank. If the deal conversely is a bridge loan, which means higher leverage, that means generally the business plan is higher risk, there's more CapEx involved. We might be going in at a higher vacancy, then we're going to double that two months. And again, that is just two months of operating expenses and debt service that is just as a reserve and is separate from an interest reserve. If the lender or we deemed that there is actually anticipated shortfalls in order to be able to pay the mortgage, then there'll be an interest reserve, which is separate to this capital reserve that you're bringing up. And it's also separate to the CapEx contingency. Most of the time people will have, let's say a million dollar CapEx budget, and they may have a five or 10% of that budget as just a contingency for just in case.
Steven: [00:19:13] Yeah. Really, really important for folks to look at the reserves. And if you're an operator, you want to be making sure you have enough money set aside, because you don't know what could happen. And one of the ways that people lose out in real estate, the number one way that people lose out is because they can't afford to cover the debt service. People don't lose out because the economy goes down, people lose in real estate because they can't afford to pay their bills in the interim before the engine starts back up and you're able to continue flying at the same altitude that you were at before.
So very, very important to keep an eye on that. If you're an operator, don't be afraid to be conservative and have a little bit extra on the sidelines. So you can sleep at night, no matter what happens. And if you're a passive investor, definitely look for that and ask your operators about some of those questions.
So when you're going into a deal, how do you look at coming up with the assumptions that you're going to use in your underwriting and what kind of assumptions should people be aware of?
Rob: [00:20:13] Yeah, absolutely. So, as I mentioned before, really that first step is just learning how to copy and paste and just kind of getting the numbers out there and seeing what that does. But then really the next step and really where the magic is, is being able to come up with accurate assumptions and that are defensible. And that's really the whole point of this is to be able to actually support your numbers. And the way that we support our numbers is obviously through market data and other research at rent and sales comparables and things like that. So the biggest assumptions that you really want to make sure you get right, are the performer runs, especially if it's a value add. If you're just buying a deal and you're going to keep the rents at the existing rent level, then you don't really need to spend a whole ton of time researching into those rents because you're not really going after that sort of business plan. But if you have an idea of raising rents $100 or $150, there's some sort of programmatic renovation, you need to really start comparing apples to apples, find properties that are in a renovated condition that will match your renovated condition and location needs to be similar.
So basically all the basics of rent comps, so need to make sure that your rent comps support your proforma rents. That would be a really important one because I always love to give this example of, you'd be amazed to see how much having your rents be off by $25 would do to your returns. Whereas if your CapEx budget is short by $100,000 or $200,000, that's going to have a nominal effect on a $10 million deal. But $25 rent difference, let's say $750 versus $775 totally changed your deal completely. So smaller numbers there, but really important.
Other big assumptions are, this is a pretty simple one, but you see it all the time, rent growth. It's kind of a, like even beginners know about it. So it's kind of hiding in plain sight. A lot of people know to call it out. It's might be the first thing that somebody says, Hey, you're using three and a half percent rent growth, or 3% rent growth, and I don't like that. So I think some people are getting smarter to that and finding ways to be aggressive without really using that as their lever. But nonetheless, it's a really sensitive metric because it's a compounding metric because if you have a five year timeline and you project 3% rent growth, you're going to be increasing the rent 3% compounded over that life cycle there.
And then lastly, the most famous one is the exit cap rate. And the thing that's funny about exit cap rates is, when we start talking about them, people, they get kind of lost in the abstraction of it because it's a five and a half cap versus a five and a quarter cap. And they can kind of get lost from the reality of all an exit cap is doing is just telling you what you're selling at. So if you correspond your exit caps to just, Hey, I'm selling for 20 million or I'm selling for 22 million, that puts it into a much clear perspective. And you can kind of sanity check your numbers, I like to say. So we're always going back and forth and sanity checking. If we're using a 6% exit cap rate, what does that mean for our exit price? And is that supported by sales comps?
Steven: [00:23:35] Yeah. Those are some really, really important things to remember. You brought up, you bought a cap rate. I think it's a really, really important thing that easily overlooked. Everybody's got a different version of what they're believing cap rate to be, talk to me a little bit about your view and how do you calculate cap rate?
Rob: [00:23:52] Yeah. Cap rate is obviously a super important calculation. So we take a really conservative approach to cap rates and more importantly than just being conservative, but just trying to be as apples to apples as possible. So a cap rate, if you're not familiar is simply just net operating income, so the income potential of the property or the in-place income divided by the purchase price. And then there are some slight variations there. So we take that calculation and we build upon it to what we call an adjusted trailing cap rate.
So when we're looking at purchasing a property that has existing income, which most properties have some existing income, we might want to improve upon it, but there's some baseline there. So what we'll do is we'll look at the in place revenue because revenue, we can't change that's money. That's hitting the account every month, and that's just what the property is performing at. However, expenses are what get interesting. Because a seller might be trying to sell me a property at an 8% cap rate, but that's because they self-manage the property. They don't take a management fee. They do a lot of the work themselves. And so they don't really have much payor on the property. So before you know that they have a 30% expense ratio and they can sell you a eight cap.
Problem is when you buy that deal and you let's say you hire a third party management company, your payroll is going to triple, you are going to be taking a management fee out of it. And before you know, it, that eight cap that you bought is actually a five. So really, you don't care what the seller's expenses are. You care what your performance expenses are.
So that's the first adjustment we make to the trailing cap rate is we'll take the in place revenue because that is what it is. And then we'll subtract it by what we believe fair market expenses are, or at least what our expenses will be. And then the last adjustment to the expense side is taxes. So depending on where you are, taxes can be a big issue, not a big issue, but for many places upon, especially upon a sale, there's big tax increases.
So you might be working with a seller who's owned the property for many years and has an extremely low tax basis. And again, they're trying to sell you this eight cap because they have low taxes. But the second you buy it, or maybe a year or two years down the road, your tax basis is going to jump up somewhere closer to your purchase price. And you're going to see a much higher expense ratio there.
So those are the adjustments we make. We take the in place revenue, subtract it with adjusted proforma expenses, and that's our adjusted cap rate. So we really know how much income we are buying through this calculation.
Steven: [00:26:29] Yeah, it's really important because I think a lot of people overlook this when they're coming up with cap rate and defining cap rate and understanding, are you including taxes? Are you not including taxes? Are you looking in the future? Are you running it off of what's the current expenses are? All of these things are really, really critical. So make sure you guys are getting clear on that. No matter if you're an absolute expert in pro, people who've been doing this for many years, we'll do it differently than someone else has been doing it for many years. So I think that's such a great point. We we've made it to the growth rapid fire round, where the questions are quick, but your answers don't need to be. So tell me you know, success, how would you define success and what is success to you?
Rob: [00:27:10] So success to me is really just the process and not the destination. So whatever you define success as success is your constant growth and progress towards whatever you define as success. So that would be kind of my general success definition and then my specific success. I mean, it's still an always moving target. I like to say that only a fool accomplishes its goals because you want to be constantly raising your own bar.
So my goals today are, let's just say, for example, in the next five years, I want to get to a billion dollars in AUM. But then who knows? Maybe when I hit that in five years, or maybe it takes me longer, maybe it takes me 10 years, then I'll raise that part at 10 million or something. So basically it's really not about the destination because getting to the billion, isn't going to feel that good. It's the constant process of working super hard to that goal and getting to the billion is really the exciting part of success.
Steven: [00:28:13] It really is. I love that definition. And habits, what are some of your key stone habits, the things you do on a daily or weekly basis that have led you to that foundation of success?
Rob: [00:28:22] Yeah. So one of my big ones is journaling. And what I try to do is write my goals down every morning. Maybe it doesn't happen every morning, but if I really get my morning, right, I will take a page and my notepad and I will first take the first section and just write everything that I'm grateful for. And it just could be anything from really trivial stuff to obviously the biggest things that I have gratitude for, but it's just kind of a brain dump. And so the first piece is gratitude.
Then the next piece are my goals and these goals, I'm just honestly rewriting them every day because they change here and there. But a lot of them are just the same goals. And they're typically anywhere from two months out to two years out.
And then finally at the bottom of the page, I will write everything that I want to get done that day that are directly tied to achieving those goals. So it really rolls up nicely. You want to be actually doing things on a day to day basis that are getting you closer towards your goals. So I think it's a great habit of mine that really keeps me focused and hopefully unlocks new ideas of new goals. Because it's not about just hitting your goals. It's about hitting the right goals.
Steven: [00:29:33] I love that. That's awesome. What's a book that's impacted your life the most or one you're excited about right now?
Rob: [00:29:40] Well, what about right now? Well, I see, Start With Why over there. I just re-read Start With Why. And it's interesting because I love rereading books especially if it's a good book, because it will tell you something different based on where you're at in life. And so Start With Why today has been a real interesting experience because when I read it the first time I didn't have a business and now that I run a business, Start With Why resonates with me in a totally different way, because now it's about, why are we doing the things we're doing? How do I motivate my employees? How do we really send out a coherent message to our audiences to really paint the best picture about ourselves? So Start With Why has been a great one.
Steven: [00:30:22] That's awesome. It is such a good book and it's great to reread them because I mean, you get a different message every single time that you go through it and it hits you right where it's supposed to right at that moment. So inspiration, what impact have mentors made on your life and how do you recommend others go out and find great mentors?
Rob: [00:30:39] Yeah. Mentors are obviously a huge cheat code or a superpower to be able to shortcut to your goals. So my dad has been a huge mentor and he's just always been there for guidance and any, it just somebody to listen to me. And I've also had other just figures in my life that have been mentors that have been able to either show me specific business, tips or kind of help me in things like that. And so what I want to bring up is I recently read Hunter's book, Raising Capital for Real Estate. And I loved what he said because I just see it so clearly when he was talking about mentors, he was saying, the thing that a mentor loves the most in a mentee is excitement.
And if you're going to mentor somebody and tell them to do something, they get it done that day. And they're really excited and they're coming back to you for more. And that excitement really is contagious. And I think mentors really like that. And it's funny because when I read that, I thought back to instances where I do that. When I'm building a new relationship and I want to show somebody that I'm serious and that I'm really worth their time, if they give me a book recommendation, I read it that day. If they tell me to check out some website, I checked it out that day. And I came back to them and I'm able to share that excitement with them. And that gets them excited and more interested in working with me further rather than just me saying, Hey, do you want to get lunch so I can pick your brain? That's my least favorite thing. I mean, that's, nobody wants their brain picked. Everybody wants to help and everybody has tons to share, but they don't want their brain picked.
Steven: [00:32:24] Yeah. That's such good advice. Highly recommend Hunter Thompson's book, Raising Capital for Real Estate. Add that one to your list if you haven't already. And so finishing on this, purpose, what drives you to live your best life every day?
Rob: [00:32:35] Kind of goes back to this success thing. And this is really cool because I actually just had a great conversation with one of my good friends. Who's a super ambitious young CEO and he was asking me, what's, what's most important to you in your life, and we're having kind of a deep conversation. And I really told him just the pursuit of excellence and just working towards any goal that you may have. And that goes back to the success conversation we had earlier. And that's really it for me. It's just that simple.
Steven: [00:33:07] Yeah. That's great. Well, this has been awesome, Rob. I want to remind people, go check out the book. The Definitive Guide to Underwriting Multifamily Acquisitions. Link will be in the show notes here for you guys. Closing out on this, where can people find out more about you or get in touch?
Rob: [00:33:26] Absolutely. So definitely check out Lonestarcapgroup.com. Right there on the homepage. You can sign up for my newsletter and get my free underwriting model sent directly to you. Check it out. There's tutorials and everything pack there. So that's a great place to get started. If you want to reach out to me directly, you can email me at Rob@lonestarcapgroup.com. Happy to continue the conversation.
Steven: [00:33:50] Wonderful guys, highly recommend that. You'll find all the information you need in the show notes. I'll leave you guys as I always leave you with a reminder to live a life worth inspiring others, and you can do so today by applying some of these strategies by going out and learning some skills that are going to make a difference in your life. They're going to make a difference in your family's life and therefore can inspire other people to take that same action and it starts to create a compounding effects. So go and do some great today, go out and apply this and we'll see you guys next time. Thank you so very much.
OUTRO: If you're an accredited investor and you're interested in learning more about our investment opportunities, the exact types of investments that I personally invest in, then head over to the investormindset.com invest, or send me an email at steven@vonfinch.com. Thanks so much.
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