Mastering Real Estate Acquisition with Mitch Pater

Foreign. Welcome back to the show. Today

we've got Mitch Pater out of what I just found out is Michigan and we're not that far apart. Mitch, man, welcome to the show. Yeah, thanks, John. I appreciate you having me. And I've been watching from afar, so. And apparently not that far away. So. Yeah, we'll have to catch up. Yeah, for sure. Well, no, and I've been before we came on. I've told you that. You know, I see on Facebook it looks like you're doing some cool things, so I'm excited to learn more about you.

So give us the kind of 50, 000 foot view of what you're doing right now and then we'll kind of dive in your story. Yeah, so like recently it's been a lot of self storage development. Probably the last couple of years I've really gone, you know, down that avenue of, you know, and we'll talk about it, but just finding good locations, putting good product on there. Something that's bigger that the Reits might want to buy in the future. That's kind of been my MO for the last couple of years.

And you know, we're still looking at value add projects. Like, you know, I'm trying to build out an acquisition team, you know, around that till still to go out and acquire like dealers, deals that make sense because I still love, I still love that. But recently it's been a lot of development. That's cool, that's awesome. So, yeah, I want to dive into that and especially acquisition team. I'll talk about that. But let's, let's back up. So kind of what'd you do after school?

What's that look like? And how'd you get in the real estate? Oh, man. Oh, gosh. You know, so after school I went to, I went to school for business, got out, worked a lot of different jobs, went in, you know, right out the gate. Worked at Menards actually as a, like a department manager and. Holy smokes. Okay, so I quickly ruled out retail because I mean, I was there like Christmas Eve and I remember like my family texted me and I'm like, oh my gosh, this is.

It's actually kind of embarrassing because. And there's nothing against that. I mean we all need, we need retail, we need Menards. Like great business just wasn't for me. So, you know, I quickly ruled that out. And every job though, what I kept finding, I was just unhappy. I like, literally every job I was like, man, is it me? Is there something wrong with like, like what I'm doing. Do I have a poor attitude?

And so then I started going down the journey of like the whole, you know, it was, I, I don't know if it began with bigger pockets or not, but it, it was like the whole financial, the fire community, the financial independent. Retire early.

Like if anyone wants to start going down a rabbit hole, that's a good one to go down because you'll, you'll learn a lot about trying to get out of the system, you know, and enrich that poor dad was in there and I, I really just went down the road of like self improvement. And that was like, that was probably the life, you know, life changing moment of like, wow, like I, I gotta think smarter about how I'm trying to get through the world. Like it, it doesn't have to be just grind, grind, grind.

It's like, okay, you know, how do I build assets with other people's money? Because I, I never really had a ton of money to work with. So that was always my first thing is like, well, geez, I can't do real estate. Like it's a capital intensive move, right? So learning those things really led me down, you know, a whole path of self improvement and so grateful that I hit those like lows because I, you know, that's what like was like, man, maybe you're not meant to work for someone else, you know.

And so that, that's, that was kind of the journey right out of school. What, what do you think? And sounds like we have similar stories. I was in retail too and had then couple sales jobs. And then you hit nail on the head with me too. You know, you found self improvement but obviously there's a lot of people out there that probably have a similar story, unhappy at jobs. So maybe they get another job. Then they're like, I'm not happy this one. Then they get another job.

What do you think triggered you to think, you know what I need to look at self improvement and maybe there's something different out there. Yeah, you know, I, for me it was just hitting these lows of being like, man, this can't be it. There's other people out there doing things that they actually enjoy doing.

And that's where it became, it was like, if I'm gonna do something and pour my, you know, my life and energy into it, like it's either got to be one that's financially, you know, beneficial or two, like it's something I enjoy doing. So it's, I, I think it was, for me it was just a, like hitting super lows of being like, super unhappy. I mean, I mean, I remember being at Menards being like, depressed.

Like, I was just, I think that was a big driver for me to be like, I gotta, I gotta take control of this and I gotta change it myself. And no one else is gonna do it for me. No one's gonna be like, here's this, you know, six figure salary job and it's perfect. It's like, dang. So for me, it was just hitting these crappy lows, man. That was, that was the driver. Yeah, yeah, no, I, I'm with you, man. That sounds like you're almost telling my story to an extent. Because it's, it's tough, man.

And I think a lot of people are in that space, but they just, they don't know how to take the first step. So for you, what was your first step? Yeah, it was, it was like, literally learning. You know, I'm a huge learner. So I, I, I, I didn't do great in school. It was like, you know, average student. And I always kind of compared learning to that world. Like, oh, I gotta like, oh man, I gotta like, remember all these things.

And it was like, it wasn't until I read, you know, rich dad, poor dad, I was like, oh my gosh, like, I really love to learn about how to, how to take care of my finances, how to be a better person. Like, and those things were attracted. So then I got like, became obsessed about learning how to be just better, better, like in life. Like, I mean, so it was all about like, oh my gosh, it's like learning doesn't have to be a, with a test at the end.

It was learning I can become better and learn how to do different and acquire skills. So a lot of it was like YouTube. And then a lot of, you know, I'm more of a, like an audio type of learner too. And so I'm learning like, hey, how do I actually consume information? When I read something, I don't really digest it. It's kind of like I just read that page and I didn't really. So then I was like, okay, well, that maybe that's not the route.

So I went to audible and I'm riding my bike, I'm getting exercise, I'm learning how to invest into assets. And I'm now I'm like, really fired up. Now I'm like, dude, I, I've got a way to get out of this. It's going to take some time, but like, I've got a way to get out of Here. So I think a lot of it was just like, you know, trial and error. And then like, the education thing is it's. It becomes fun when you figure out what you. You get excited about. Yeah, yeah, for sure.

Yeah. It's. It's. It's really weird because I've. I've got young kids and I always look at, you know, what they're doing in school, and I was like, again, your story. It's like ours are completely go hand in hand. But you don't really. They don't teach you that there are different ways to learn, and everyone has a different way to learn. Like, I learned different from you. I learned by doing and failing and trying it again. And no one talks about that. It's. Again, like, in school, it's.

They're trying to create employees and they want you to memorize stuff, and then you have a test, and if you don't, if you didn't memorize it, like you said, like, you'll read a page and you're like, what? I just read. Yeah, like, dude, I. Same way. I thought there was something wrong with me for a while. I was like, I just read that and I still don't really get it. But then if I hear it or if I do it, like you said, kind of.

I'm also a very, like, I have to go through the motions, unfortunately. I wish it wasn't that way because I'd probably be way further ahead if I could just like, listen, gather it, and like, immediately know what to do. But I gotta, like, listen to it, I gotta do it. And then it's like, I, oh, smack you upside the face. That didn't work. And then like, go figure out a new. A different way. And so I'm with you on that. Yep. Well, I think these are traits that a lot of entrepreneurs have. Right.

Like, there's a reason why school and being an employee didn't really, you know, obviously we were both employees at one time, but I think at some point we're kind of like, all right, this isn't really the road where we should be on. So everything happens for a reason. But, yeah, all that training, education, what. What happened next? Yeah, so I started.

I was at a job again, which I hated, and I started, like, a video production company. So this was like my first, like, foot into working for myself, creating my own schedule. And I went from, like, if you're familiar with Robert Kiyosaki's kind of like four quadrants, right. I went from, like, employee to self employed. So this was My first time, like, basically I started doing wedding videos and this, I had booked out a whole summer of wedding videos while I was at this job.

And I was like, man, I'm actually going to be making the same amount that I am at this job than a summer of video production for, for wedding videos. So I was like, wow, like, and I've always had kind of this, you might ask why video? But I always had like, kind of an eye for like aesthetics and like good looking shots, I guess. And like that was just something I gravitated towards. And like, like the technology, like the editing and all that kind of came natural.

So I went down that road, booked out this summer and I was like, you know what, like what's the worst that can happen? I, if I quit this job, like, and I put everything into this video company, like at the very least I'm making the same amount of money and you know, the whole winter I could take off if I wanted to. And so I quit the job, like went all in on this production deal. And that took me. This is before kids, family. Yep, yep, yep.

So before kids, before family took, I took the leap and went all into the, to this thing and I was like, well dude, if, if, if anything I can just do wedding videos and make the money. So went down that road and then I ended up working like, you know, three times as hard and making way more money than I ever could have at that job. And so that led me down the road of like then thinking, okay, well now I want to not work so much or maybe I just picked the videos that I want to do.

So now I'm trying to figure out how to, to, to be a little more strategic and take some of this surplus money and put it into something where it's making money for me. And at that time, again, back to the self improvement thing, I knew I had to invest into assets, otherwise I'd be just doing wedding videos until I died. And I was like, oh my gosh, this is, it's a grind. Like that's a very, very hard thing to do too. Like video production, like if you do it really well, it's, it's like a hustle.

Like you're, you're working your butt off for that too. So I started, I bought my first duplex after that and like that was like really the beginning of it all. And then it just kind of transpired from there. So. So it sounds like you kind of followed like a passion, right? It sounds like you were kind of good at. I did, yeah. I did. I followed the passion. But looking back, like, I don't think passion is the route.

Like, I think, I think, I think you can find that you may get lucky finding a passion that aligns with your career. But like, I, I think in the beginning, if I went back, I would focus on more, like, how do I get skills that produce an outcome? You know, whether that's sales, I think sales is huge. Like, if you become, if you can sell and it. It in sales, it's really just helping per. You know, helping people find a solution to a problem.

Like, if you can do that, like, you're going to be set up no matter what. So I wish someone kind of showed me, hey, it's not a. It's not about like having to love what you do, but gathering like everyday skills and stacking those on top of each other. Like, that'll help you and have a good foundation. You can do anything. So that would be my recommend recommendation to, like, my kids. I would say, hey, it's not about you. You don't have to love this. You don't have to do it forever.

But if you can take maybe a sales component or a management component and then figure out how to morph that into something that maybe you want to do for yourself, you don't have to, you know, go out and build a company, you're on your own. But I think that would be a much better launch pad for me. I didn't know. So. Yeah, no, dude, man, I, I love all that because, yeah, stacking skills, I like. And I mean, I, I think we're probably around the same age. Coming out of school.

Well, one coming out of school, I had no idea what I want to do. Even coming out of college. Like, I. Till I was like 30 is. I had. Then I kind of saw a road that I liked. But I love the idea of stacking skills. And obviously sales is. I, I love that skill. But it seems like passion. We were kind of told growing up, like, follow your passion, right? And, and I'm with you.

I think passion is more for hobbies and you got to stack skills and then eventually once you stack those skills, you'll find kind of a road or a groove that may work for you. Yeah, yeah. Because like, passion, passion can leave you like, high and dry financially. Right? And like, you know, I think it's good. I think, I think you should look for passion. But early on like that you gotta get some sort of foundation so you're not always struggling.

Like, that's where, you know, it took Me way too long to figure that out. I was like, well, I. I need to become more valuable. Not. I need to, like, figure out what I like. Like, that'll come later. If I could do all these other things, I can then kind of fit it into a financially, like, sound vehicle that I can align my passion with and. And get there.

So, yeah, that's going to be hard to, like, push on to the kids because that's, you know, so that's a. That's a work in progress of, like, trying to teach our kids, you know, become valuable first, and then you can figure out what. What you like. But at least I can show my kids that might, you know, I didn't have any of that. No one was telling me that. And it's no one's fault. It's just, you know. Well, yeah, and I think there's.

I was talking to, actually an elementary buddy that I think I met him in, like, first grade. We had lunch yesterday. Somehow we both moved away from our hometown and now live a mile from each other. But we were talking about just kind of, you know, growing up and teaching our kids, you know, where, you know, how to teach our kids and get them on the right path. And I think you have to try a lot of. A lot of things to find out what you're not good at and what you don't like. Right.

You know, I'm sure there's a. You said you had a bunch of jobs. You had to do those jobs and figure out, like, oh, I don't like that. So now I gotta find something else that I like. Yeah. And I think you learn everything. Like, every one of those, you learn something too. Right. Like, in one of those, I learned about, you know, I was. I was in an HR department, and I learned a lot about, like, taxes and, you know, being on the employee side.

Like, I learned a lot about just business in general from that. So, yeah, you take a little bit from each, you know, each gig and. And just keep pressing forward. But, yeah, it's. It kind of all comes back to, like, the desire. I think some kids aren't meant to go off and do their own thing. I'd actually advise them not to because they're just not built that way. Like, there's a lot of pressure and there's a lot of things that a lot of people don't talk about. That, you know, it's not.

It's not for everyone. That's for dang sure. So, you know, that I think it's. It's part of the journey though, right? It's figuring out, you know, what it, what like gets you fired up. And so I don't know. I, I've enjoyed it so far. It's been a grind though. Yep, yep. No, for sure. So you got that first duplex. When was that what it looked like? How'd you take it down? Did you have savings? Did you get a loan? How. Yeah, so I think I was thinking about that.

I was like, I should know these dates, but I want to say 20, 18 or 19. Okay. It was like my first real estate purchase that was for investment purposes and at the time like it felt really high in terms of like I, I had no idea how to find off market deals so I would, I basically caught up with a local realtor and, and went that route. You know.

Luckily I had the, the wind behind me in terms of like a macro environment from like 18 to 2022. Like almost no one could go wrong in that time period of investment real estate. But I didn't purchase it at a deal. But I just conventional financing, which was tough because, because I had that video production thing, you know, and it's self employ employment. So that was real difficult to get, to get a, to get like conventional financing on.

But I finally, you know, I got through that and then it just took, you know, then I, then I was all in. I started getting a little bit of cash flow and I was like, oh my gosh, how many houses do I need to get out of this like video deal? You know? And so then, then the, the game turned on even more. And what happens is like once you start getting a little traction, you're like, well how do I do this with no money? Or how do I do this with other people's money?

And that, that was where I went heavy into because it wasn't like I was making a boatload of money. I had to figure out well, how do I. And that led me to the Bird model. So then I was like, oh, it's game on. Like this is all I'm gonna do. And that's, that's actually how I built my portfolio and went on to flip houses and do short term rentals and other like strategies along with that.

But the Burr model is like the only reason I ever got to where I'm at today is because I was able to, to buy under market rehab and refinance. That was like the key component to the, the growth that I've had is, is doing that model. So I, you know, whatever podcast that was, that was a game Changer. Yeah. So then you take the. After you refinance, you take those funds and buy something else. Yeah. Typically, it would always be back, you know, replenishing wherever I borrowed that capital.

So what I would do is I'd go out and buy these deals with a private lender in full, in cash, you know, 70 under ARV, minus rehabs. So, like, I stuck to that. So if it's a hundred thousand dollars and it needed 20 grand in rehab costs, I'm buying that thing at whatever, 50 grand I had to get that number. And then I knew my refinance you could do, like, what's called a. Oh, crap. What's it called?

Private money mortgage, I believe, where I was able to acquire these and refinance like a month after. After that rehab and that renter was in there, I didn't have to season them. And that was another game changer. I was doing it where I could do it really quickly. So I'd get that renter in there, go back to the bank, refinance, pay that lender back all this capital, and now I've got the asset. So I wasn't. Wasn't really making any money. Right. I was just acquiring assets.

So stacking equity is like what I would call it. And then, you know, over time, I could liquidate that equity. And what I did is I pushed. Push it into storage. But that was my. My big thing. For like five years, I'm just stacking assets, and then I'm eventually going to make a bigger play. So. And it's like Monopoly. Yeah, no, exactly, exactly. Small greenhouses and, you know, get up to the hotel. Yep. Sorry, you were saying? Something cut you off?

Oh, no, I. I think, you know, for folks starting, like, I think that's a, you know, they. They think, like, I'm gonna get into real estate and make money. It's like, oh, it's such a long game. So, like, when I was doing that, I was like, man, this. This is gonna take a long time because cash flow is minimal on the houses. But I knew I had equity in those things, and I could. One thing a lot of people don't, you know, they.

I like single family because it, for me, it was a chip to move up to something bigger. Like you said the, The Red hotel. So that. That was the idea. The whole time I was like, I'm gonna use these to get me into something bigger. So. Yep. Well, that's what. And we talked about this with Tim Bratz on a couple shows ago. Real estate, especially single family rentals is more of an investment. Realistically, will you cash flow? You know, maybe a little bit.

But if you hang on to it for seven to 10 years, all that cash flow is probably going out the window because you got to replace the H vac, the roof, the windows, door. You know, you're going to replace all that stuff at some point, but you should have appreciation over time and again. It's an investment vehicle. So it sounds like you, you started scaling, you didn't do the rehab yourself, right? No, I would always, I would always have someone in there.

Yeah. So I built like a small team that I had locally here. Bought a dump trailer, you know, a truck. Had the crew out, had the crew out and about. And I did flips along the way too. So it transpired from building a rental portfolio to, to hey, I need some more active money too, right. So then I went into flipping and then I'd buy, I'd buy a re. A burr and then I would do a short term rental. I mean I, I was trying things again back to like trying to figure out the lane.

I didn't really know the lane and I still don't. You know, it's still moving even today. But yeah, just kind of like, okay. And then man, I got into the landlording like by default. Like really, you know, that's a hard business to scale. So that was, you know, I started looking at that and saying, man, like I introduced property management, there went all the cash flow. So then I'm like, okay, well that's not the move either. So again, just like trial and error on all of it.

Yeah. So what, how much did you scale up to and do you still have it or you sold everything off? Yeah, so I got up to, I think it was just shy of 30 doors. Nice. And that, that was a range from like one to four units. So a lot of them duplexes, a couple four units. And yeah, like I said, I introduced property management. That was difficult. It was just like, okay, well geez, I'm not making any money now and I'm still actually dealing this. So single family.

For me, the business model was difficult, but, but the underlying like move was, was a good move. Like it was, it, it paid off, you know, but it was like a lot of, a lot of headaches to get there. And then I, I packaged up some single families as the market was starting to get really hot and I started saying, hey, I can use these as a, a way to trade into bigger things. So I bought my first storage deal. I think it was 20, 21. Okay. And then picked it up.

I used private money on that and the goal there was to acquire, do the same thing I had been doing in single family, but I had been learning about storage the whole time. And I was like, okay, well all I gotta do is increase rents, put a new sign up. I did all these things too. And then I decided to sell it. But I could have refinanced that one and kept that one as well. So I had options there.

But you know, everyone's, you know, portfolio and you know, you're, you're, you're moving things around to keep going. So I, I decided to sell that one. But yeah, it's been the same thing. I'm, I'm trying to get my money back on a refinance. That's, that's the goal because I just don't have enough to just go out and throw down money everywhere. You know, every time a deal comes up, I have to strategically keep recycling my, my cash.

So, yeah, well, and I think that, I mean you can, I've, I've thought about having someone on like a syndicator, somebody on the kind of debate between syndicating and using your own money, but I think there's a lot of just power in using your own money and your own equity because you're not, there's nothing like, it's definitely, I think there's times to use private money and syndicate, but I think if you're building a portfolio or hanging up a portfolio, you're hanging on to, to me, I think

using your own money and your own equity is smart because who do you have to answer to? Right? Markets are going to fall, markets are going to rise. And you know, if it's just you and you don't have money partners, you just have more flexibility. Yeah, I couldn't agree more. I've gone down the, the road of partnerships and I, I'm in partnerships now on some bigger deals and there's a place for it all. But like, in the end, like, I couldn't agree more with you.

Like syndicators, you know, they're working for fees and they're also working for the end result, which is a five to seven year play and there's nothing wrong with that. Development's very, very similar. But if you're doing it, you know, you and a couple partners, the pie is much bigger. Right? So, yeah, I don't know. I mean, I, I think there's a place for syndication, clearly, but I think now you got to be real careful and you have to have a killer deal.

Like, I, I was always scared about putting my name out there and raising this money and like, things go sideways. So that's been a hesitant move for me is like, could we go out and syndicate some of the deals that we're doing? For sure. I mean, the returns are there, but, man, if, if I can find a way to do it either alone one, I always look at it like this. If I could do it alone, one, I'm gonna do it alone. If I can't do it alone.

And typically it's because the, the finances, the bank's gonna say, hey, Mitch, you got too much crap going on. We need some personal guarantees that are beyond where what you're trying to do that's, you know, you're gonna hit that hurdle when you're, when you're a solo person. So one alone, two with partners. And then, you know, the last resort is, you know, can, can you go out and raise the money? And I'm no like, money raiser. That's not like my skill set.

But, you know, finding deals is something that, like, I enjoy and that's kind of, you know, what I hope to keep doing. Yeah, yeah, for sure. So you got a storage deal in 21, sold it. Have you bought anymore? I know you're developing. What kind of happened after that? Yeah, so sold that deal. I wanted to get kind of more localized, so keep it in the backyard. That was down in North Carolina. So my very first deal was actually, you know, whatever, a thousand, couple thousand miles away.

So I was flying there, I was like staying at the hotel and I was like, man, like, this is fine for now, but this is not the move. So I tried to get back to Michigan and, and I bought, I bought some smaller ones, you know, locally here, and, and then it was just like, dang, this is, you know, it's, it's the same amount of work. When they say the, the small deal and the big deal, it's the same amount of things in storage. It's the same thing.

You're still dealing with customers, you dealing with the banks, you're still doing all the, all the, you know, operational things. So I was like, man, these smaller deals just aren't cutting it. So I, I, I, when you say smaller, what size? Yeah, so I, I bought one that was like 8, 000 square feet sole intention was to build it out, to expand it and then sell it. So we actually went through like the, the engineering process to do the, the expansion.

And that was my first, like, little bit of like construction got the plans approved and then I ended up just selling it at that like shovel ready state. Didn't. The numbers really didn't make sense unless I was going to hold on to it. So I was like, I'll just get out now, move my capital into something else. And so that was like, that was a small one. And then I, I purchased One that was 20,000 square feet and I was going to do the whole Burr model there and interest rates just were flying up.

So I, I bought it right. It was like, I bought it right around 50 bucks a square foot. It was right around a million bucks. But rates were climbing so fast that I was like, dude, this is not looking good for the refinance. So the Burr model and, and it's, it's great. But that deal I bought in cash with private money. So I was on the clock and I'm like, dude, these rates are going insane. There's no way this is going to appraise. So I ended up getting out of that one too.

Not for like this huge gain or anything. It was just kind of like cut your losses and, and move on. So that was probably the one deal like there's, you know, luckily I've been super lucky to make money on almost every deal I've ever done. That one I like broke even, maybe even lost some money because there was a value add component to that too. But that was my first taste of like, oh, interest rates are like, you know, everything in commercial real estate. So I almost got my ass handed to me.

Honestly. I was like, get out, get out, get out. I was trying to like fire sale because I knew it just I wasn't going to be able to refi. And then I would have had to put quite a bit of capital in there to keep it. And it wasn't the highest and best use of money at that time. So yeah, you know, again, just learning along the way. So then I, I did a, my first development deal, sold off the rest of my single family and I had a piece of land. I did it all wrong by the way.

Like bought the land, didn't even have it entitled. Like, like all the things that you could do wrong. And on a development deal I did and luckily at all it all worked out. But yeah, that one's. That's kind of embarrassing to say actually, but right. No, we all make mistakes and that's how you learn and you don't make them again. Yeah, yeah, yeah. So yeah, we're not buying any more land until we know we can Build on it. But yeah, that was my first development. It's here locally.

It's a site that has additional acreage. We're planning on expanding. It currently is 23,000 square ft. We're ready for phase two, which is about 44000 square feet. So just shy of 70, 000 solid area that's growing. And you know, locally, I know, you know, long term this is going to be a good asset to hold on to. So picked up the land for a great price and you know, went down the whole development thing. So if we want to expand on anything, let me know.

Yeah, well, when did you buy that and how long did it take to fill up? Yeah, so we built it in 2022. That has been a slow lease up. You know they, people will say right around 3% a month on lease up. And we're ahead of that schedule. But we're, we're now stabilized. It's right around I think 87. We're still trying to boost that up a little bit more and make the bank, the bank happy for phase two. But it took about a year to get to that on 138 units.

You know, I think we're at like 110 or something. So I don't know what that broke down to, but it was, it was, it was a little more than, you know, the 3% but it wasn't as aggressive as I had hoped. Yep, yeah, it probably never is, right? They never moving fast enough. Did you run any specials or get them in cheap or what was your plan to lease up? Yeah, so that's something I've been testing a lot and I, you know, every deal I'm trying something new.

That one I did a lot of like 50 off first month. I did some one month freeze, saw kind of those types of clients and did the spare foot. I've done, you know, postcards. I've tried just about everything that I can think of and I continue to, you know, every deal I'm trying new things, right. So I'm starting to see some good, good moves with like what's called EEDIM or something.

It's, it's basically the postcard method of, of hitting local mailing routes in your area to, to let folks know of seasonal promotions. Like I'm doing a spring sale right now on 10,000 postcards for a new development deal. We're getting rentals from those. Nice. And then signage. And then one thing I'm trying to do more of and like figure out who to use is, is Facebook advertising. Obviously Google Ads, local and organic SEO. So we're doing everything we can to lease these things up.

That first one, I didn't do like hardly any of those. Like, it was just like postcards and like signage that that was it. And so I, I could have probably filled that up quicker, but you know, I'm going down this whole avenue of like, how do I lease these things up as fast as possible. Yeah, you, you might be the first person like not putting you on a bus or you might be the first person I've heard that have used postcards.

So when you're doing that, are you finding like apartments or senior living communities? Are you just blasting within like a mile or two radius? Yeah, so I, I just like got a good grasp on this. But like the, so if you go to USPS.com there's, you know, you'll see them in your, I mean you'll see them in your mailbox. I was like, how are these people getting like the local pizzeria? You know, how are they. Like, I need to be in front of everyone that these guys are in front of.

So I finally found this USPS tool that's like every door, direct business, something. It's a mailing camp. You can build a campaign right through one of their vendors and then you pick, you pick mailing routes. So then it'll show you on a map. You can pick out where you want these cards to go to. And so I finally was like, oh, well, this is, this is what I've been trying to do the whole time. And I just didn't know the tool was out there. So hopefully that's a nugget for someone.

But yeah, you just pick local mailing routes. And I'm, I'm doing, you know, three to five mile radius around my site and then I'm getting, you know, you can have them also design the postcard for you so you can help them, you know, catering. I've got one here if you want to see it. Yeah, yeah. But anyways, so then you're, you're creating this postcard and then it's going out in the mail and you know, I've been lucky enough to, I probably landed at least, you know, I just built this site here.

I'll share this one here for you. Yeah, it's interesting. I don't. And we've got some, you know, I've been involved some with some groups of masterminds and people have always kind of talked about. Yeah, I wonder if mailing would work or putting flyers on cars and it's like, no, there's no return in that. Right. Because, you know, Google Ads or Facebook ads or something like that seems to have a bigger bang for your buck. But it sounds, sounds like it's working for you.

Yeah, I, I don't know why. I mean, when people are. If you're doing a postcard and every, every person's getting one of these in the mail, as long as your call to action is good enough. Right. Like, so if you're getting one month free here and you see that, you're not even probably looking at any of this other crap, but you're probably going to call me if you need storage. Right?

So, I mean, that's, that's all we're trying to do is just to get the phone to ring, and then we're, you know, I don't know where the other one went, but yeah, so we're just trying to get, get the phone to ring on that. Well, and I think too, you know, I, I, when I say you're probably the only one I've talked to have done it, that's what you want to do, right. You don't want to do what everyone else is doing because everyone else is doing it.

You're the only one that those people are seeing in their mailbox. And that's, you know, that's powerful just in itself because you're doing something different. Well, and I've, I've had success with direct mail on all fronts. Like, direct mail has been a huge reason. I got a lot of single family. So, you know, I think a lot of it's like, call to action is huge and making it simple and, and like, I don't know. Yeah. If no one else is doing it, then for sure I'm gonna see the rewards.

Did you see that or was I sharing that correctly or. No? No. And I don't know. Yeah, I don't know if you can share your screen or not. I've never tried it on, on here. Oh, okay. Well, we, we will. I, you know, I could always give it to you or whatever. So. Yeah, yeah, yeah, yeah. I had it up and I was like, oh, cool. They could. Or. Yeah. And if you're willing to share your information, we'll do this at the end of the show. You know, people can reach out to you if they want to see it.

No, that's cool, man. So development.

Give us like, the top one to three issues that you've ran into that you think probably stop people from developing. Yeah, I mean, the biggest one is I think they, they, that they know, have to know everything. I mean the whole purpose of like you look at some of these developers and they're, they're just everyday guys like me. Like they don't know about different soil types, they don't know about the setbacks and all the, you know, you could get into the weeds on that.

But are you trying to be a general contractor or are you trying to be the developer? So you know, I don't need to know all that. I don't want to really know all that. All my goal is to find good locations that are under supplied that I could fill a need. And this goes for everything. I mean this is, this is multifamily, this is any other asset class. Like again providing value is like back to, back to what we earlier were talking about.

Like my value is now like finding good locations, like I said, providing a product that people need. Like that's, that's what I've found that hey, I can make a lot of money doing this, right? So I think that that's number one. They think that they have to know everything. And then so, so with that, you know, find a good general contractor, they're going to take you 80% the way there, right? Them and a good engineer, those are the two things that you need.

So maybe a general contractor that's built self storage or multifamily or whatever you're doing right, Find that guy and then a good local engineer that knows the, the local municipality like rules and ordinances and all that. Like you team up with those two and like you're good, like that's all you need. And I would say the other thing is they probably underestimate depending on what type of asset class. But like you know, lease up's a real thing.

So you know that's going to be your hardest, that's going to be the hardest part of the job in self storage for sure because it could take three years, you know. So like are you prepared to hang on for three years to see no money coming in? Like that's hard. So you know, just to build something and sell it, they're out there. You're seeing a lot of co deals like that. But I mean if you're going through all this headache, you better to me fill it up, then sell it.

That's kind of again the value that you bring as a developer. And the last thing, I mean I, I think people develop in the wrong areas. Like they're not really looking at like the demographics and saying, hey, why are people Moving here. What are they moving here for? They're just putting them up in like northern Michigan because there's cheap land like that. That could be painful from a lease up standpoint, from an exit strategy. Like we're building these to sell them.

But so, so we need a buyer in mind at the end. I think that's that you gotta have that if you're not like you're being, I think a little risky. So those are probably the biggest things. Yeah, those are all. Man, you hit on so much. And if you guys didn't catch all that, listen, again, because you hit on so much, the biggest thing is, and this goes with anything is you don't need to know everything. Right. Lean on experts. And I think there's too many people now.

There's probably going to be seasons in your life where you need to do or learn a lot of what's going on. Right. But there's also a time where find the experts. Let them run with the ball. Don't be cheap with it. Find the right experts. And then I really liked how you said you got to know who your buyer is. And we've talked about that with just with acquisitions in general. Who's your buyer? Right.

You gotta, you gotta think about that because I think too often people buy even like you said you had an 8, 000 square foot site. I have a 6000. It's now 8, 000 because we expanded a little bit. But who's my buyer? Right. You've got to think about that. Yeah, that buyer is probably like if it's just that we do have two sites in that town, so it's a little different. But if it's 8, 000 square feet, it's a newbie. Right. You're not finding anyone else.

So you got to think about those things when you're going into the deals, who your buyer is. Yeah, it's all awesome stuff, man. So you're developing obviously. Where are you at now? What's your, what's your portfolio look like? Yeah, so it's a mix of. It's a myth mix of existing and then the new developments. A lot of new development product coming out. I mean, I think think we're. We're building about a thousand units this year. We're set, we're set for a thousand.

And then we just completed a site that I'm leasing off. That was the postcard on there. That was 450 units or I'd have to look. But yeah, so a lot of like lease up and a Lot of development going on.

And my, my, my thing is like if I can build for 60 to 70 bucks a square foot, which recently I have been like that's where we're falling in and we are building institutional style like product and all this stuff that I'm building in the locations that I'm building, there's 20 year old products selling for over 100 bucks a square foot. So to me I'm reducing my risk knowing that I have an exit, right.

A local, like big REIT in our area, not even a reit, but a local, big, bigger player, like they buy these all the time. So I'm, I'm trying to build what he, he's going to want to buy from me in the future.

And so the goal for me right now is to build 15 to 20 locations around a million square feet in Michigan, package them up and look at an exit. Maybe we cherry pick some that we want to keep, but the goal is to package them up in five to seven years, just like a syndication play. But then I want a 1031 into some larger, more passive, like triple net industrial style stuff. So I'm kind of like putting all this work in right now. I'm doing all the leasing.

I'm going to hopefully have a nice exit and you know, the stuff that I own alone I'll keep probably, you know, to have a diverse portfolio of maybe some industrial, some self storage. I own a couple short term rentals and you know, we'll, we'll, we'll see what it looks like later. But the goal is to, to build around a million square feet and, and see what we can do with that. That's awesome. Well, what's, what's great about that is you know where you're going, right?

I think too many people have no idea, you know, where you're going. You know your market, you know your buyers, like you know, every inch of the way. Where I don't think, I think a lot of people don't know. They're just kind of trying to get through the day and trying to maybe try to do another deal. But maybe it's in Arkansas or maybe it's in North Carolina. Like they're just all over the map where you've got a plan and you're just executing the plan and you know.

Yeah, that's, Yep. Yeah. I, I, you know, a long time in a long time ago, someone said build out your dream life and tell me what it, what does it cost? And I was like, oh man, like, do you really want to Hear what this costs. Like, it's gonna sound crazy, but, like, the number was around 100 grand a month. Like, yeah, I need, I need a hundred grand a month coming in to build my dream life. That's like having multiple houses.

That's like, going on vacations and not stressing, that's paying for employees. Like, that number sounds like a lot, but people make them over a million dollars every day. Like, I mean, it's insane the amount that people make out there, especially nowadays, like, it's expensive to live a good life. So. So like a million two a year. That's not even, like, that crazy. And so, yeah, I've set that goal, and I'm set on that goal. We're gonna get there.

It, you know, it'll take, you know, probably all the next five years to get there, and then, you know, the goal is then to, to, to trade up into something big and kind of maybe to step back more into not doing so much work, but we'll see. I mean, I don't know, I don't know how, how old you are. I'm 37, so at 42, I'm retired. I, I, I'm gonna get bored. So I don't think that's the move either. Yeah, no, I can't see it. Yeah, I'm, well, I'm 42 now. I can't see. You retired? Well, in retire.

Retirement looks different for, I think, us entrepreneurs than typical, typical people. Yeah. Yeah. Hopefully I'm just doing, like, development deals that are fun and exciting and because it's kind of like, you know, the development for me is like, it's fun, you know, I don't know if you did a lot of rehabs, but I actually enjoyed, like, taking an older house and, like, making it look cool and, like, and then you exit and you get paid for it.

Like, that was fun, minus all the, the headaches between, but that was exciting. So you kind of get that same thing with development. You're taking dirt and you're like, wow, this beautiful asset, and then I'm going to get paid for all that on the back end. That's kind of been my, maybe my attraction to it a little bit too, is like, a little pride maybe around, like, the stuff that we're doing, and, and then hopefully the exit is what I want it to be.

And yeah, so, yeah, it's a, it's a fun journey. That's awesome, man. Yeah, well, no, you're making things better, and you, you see the fruits of your labor, which is cool. Before we get in the last few questions, kind of our. Our podcast questions we ask every show. What's your team look like right now? Yeah, so it's crazy. I. I had another local person here on staff, and I. I let him go for his own sake in terms of, like, does he fit into what we're doing? But right now it's just me and one in.

In one VA actually. So it's kind of just contractors. Yeah. And then everything is like I said, I've got a, you know, a call away on the gc. You know, I'm. I'm using, you know, professional people around me so, you know, directly. I don't have any real staff, and I want to keep it lean like that. Like, I enjoy not having to come in and like, be like, what's John doing today? You know, like, I don't wanna, like, I just.

If I can get by with that, like, I'm gonna go as far as I can with outside vendors, so we'll see where that takes me. I could totally use, like an executive assistant at this point. I just been kind of holding out, so. Very, very small team. Yeah. No, it's cool. So you use a, I'm assuming, call center for storage. Yeah. Yep. Cool. Cool, man. Yeah, we're not. Not too far off from that.

I've got a few employees, but I've also kind of shifted my way of thinking about all that too, because initially I was the same way. And some of that comes from my background where I worked and not wanting to have the same type of work environment, but my people are all remote anyway, so it doesn't, you know, no office for me with employees coming in. Yeah, but let's get into the. The last three questions here.

And actually, you basically answered the one in really good detail with what's next for you. And it sounds like you're. You're bundling these up, selling them off, and then buying some triple net, hopefully. Yeah, that's the goal. I mean, I like the. I like the triple net just from a. An operational standpoint. I mean, it's. No, it's not perfect either, though. I mean, you'll get in if you go down that asset class too. I mean, vacancies are, you know, they're.

That's a real number when you got a hundred thousand square foot building empty, like, you know, so. So there's pros and cons to it all, but I think that's a great move for, you know, long term. And I'll keep some storage. I like storage. I think it's a great asset class, and it's very consistent. So that. That's huge. Yeah, no, it's cool. What's one thing you're better at than everybody else? Kind of your superpower. Oh, man. I would say, like, I do okay with talking to owners.

It's not something that I like. I just see, I see the feedback from them. I think that they enjoy talking to someone that's hungry. You know, I'll go meet people, I'll take them out to lunch. Like, I will spend the time to do those things. Like, I'm talking to a guy right now. I've been talking to him for like two years. He's like, I'm selling to you, Mitch. Don't worry. Like, I planted the seeds. So, like, it's, it's good. I think I do okay in that space.

And then, like, just probably resourcefulness. Like, again, I'm no professional at what I'm doing, but I'm gonna figure it out. And, dude, all the answers are, are out there. And if I don't know, I, I'm like, I'm meeting someone in a couple weeks to learn about how to lease these things up faster. I don't know. Like, I'm just gonna figure it out, though. Like, I'm gonna go, I'm gonna bring this guy to lunch and I'm gonna take everything he's done and be like, how do I implement that?

And so I'm definitely not the smart, the smart, intelligent guy. I'm just like, taking and implementing the. Smart is all relative. Right? Like, you're, you're smart in leveraging your, your relationships. And I, I do the same thing. I meet with owners anytime. It's a somewhat decent opportunity. Like, I'm going to meet him. Yeah. Period. And you just build a rapport and. No, same thing. I mean, I think that's, that's powerful.

And obviously you have relationships with third party contractors and that's how you're growing your business. So. No, it's awesome, man. If anyone wants to find you, reach out, any questions or want to connect, how can they find you? Yeah, just anything online. I mean, I, I try to post. I'm pretty, pretty bad at that. But like, LinkedIn, I check. So just Mitchell Pater there, Facebook. You could find me online pretty easy.

You know, a lot of guys asked me about doing a course and all that crap, and I'm like, I don't know, man, maybe, maybe in the future, but I'd like to build a, I'd like to get to that 15 to 20 portfolio and feel really confident that I'm going to help someone out instead of just take their money. Like, that's not my goal. So, you know, I. You could find me online and if I ever post something, you'll probably hear about it. But yeah, right now it's like build mode. Like, I don't really.

I'm not trying to build a group. I'm not trying to take your five grand or anything like that. I'm just trying to focus on, you know, my stuff. And then, you know, in the future, maybe be able to give back too, though, because there's been people that help me, you know, like the guy that I'm meeting a couple weeks, like, so grateful that folks do help. You know, it expedited my process along the way. So I do want to give back in the future for sure. Yep. No, dude, that. That's so powerful.

And I've talked about it on here how there's probably, I don't want to say too many educators, because there can never be too many. There's too many bad ones that have done one or two deals and maybe not even that many, and they're just like, yeah, now I'm an expert. No, you're not. You're playing with other people's money. That could be their life savings. Yeah, it could go on for that. Yeah. No, I'm with you. No, that's. That's the right road. And just you and you said something.

Actually, we just connected earlier this week, right through. Through Facebook. Just you being on the show. And no matter how many people listen, you're giving back. Right. And this is the reason why I do this show, because I. I'm the same way. I don't want a group. I don't want. I don't want to do all that stuff, but I do want to help people out because same thing, I had people that helped me out.

But yeah, just you doing the show, I guarantee there are a ton of people that will get a ton of value out of this inspiring, great information. So, yeah, man, it's awesome. Appreciate you coming on. Yeah, well, thank you for having me. And I'll get you that. You know, that USPS thing, I think that is beneficial. I think folks that are in lease up, like, try that. It's very cheap. The more. The more that you do, you can get a cheaper price too. So, yeah, happy to share.

And, you know, I appreciate you having me. Yeah, that's an awesome nugget. And Mitch, hang on here after we sign off, but appreciate you coming on again man. Awesome show and appreciate everyone for listening. See you next time. Thanks for following, subscribing and listening to this episode of of the Do More podcast hosted by John Farling. To learn more or ask questions, go to L4Investing.com.