5 Essential Tips for New Graduates in Real Estate Investing

Dylan Silver (00:00.642)
Hey folks, welcome back to the show. I’m your host, Dylan Silver. And today on the show I have Peter Fisher. Peter is a seasoned financial advisor and co-founder of Sequent Real Estate and Wealth Management. With over 20 years of experience, Peter specializes in tax advantaged real estate strategies, including Delaware statutory trusts, REITs, opportunity zones, and other private placements. Peter, welcome to the show.

Peter Fisher (00:29.449)
Thank you for having me.

Dylan Silver (00:32.11)
Absolutely, I always like to start off at the top of the show by asking folks how they got into the real estate space.

Peter Fisher (00:40.541)
Yeah, so when I graduated university from Indiana University, I was able to take a position with a large institutional real estate group out of Chicago that specialized in securitized real estate strategies for individual clients. they were a real estate sponsor. And five years ago, my business partner and I

started Sequent Real Estate plus Wealth Management. We really saw a gap in the financial services industry to sort of marry real estate with investment portfolios. And that’s how I got started right out of the gate in 2005.

Dylan Silver (01:33.462)
And so this is a very interesting area. There’s so many ways where I could go with this. I think about one of the previous guests that I had a couple of weeks back was in self-directed IRAs using that as a vehicle for real estate investment. But I believe and I think this is such an interesting topic because so many people of course think about the stock market as the main way, the main vehicle for retirement.

and very few people other than their primary residents to the masses that is look at real estate as a way where you know that they can retire off of and i would love to see more people get involved in that of course being a realtor myself having this show i would love to see everybody get involved but it’s awesome to see that this folks like you out there that are bringing that traditional background at two folks so they can have access to it’s a real estate wealth

Peter Fisher (02:28.861)
Yeah, you talk about retirement, what’s the greatest need in retirement for most families is income. And a lot of these families have built real estate portfolios during their active investing years. And in that life cycle change of retiring, we want to relax, spend time with the grandchildren. And we provide that solution by

taking their investment property, they’re going to do a 1031 tax deferred exchange and exchange that into passive investment strategies, which are hands off. The specific investment that we use most frequently is the Delaware Statutory Trust. And this is a investment vehicle that’s professionally managed. It is a like kind asset based on a revenue ruling going back to 2004.

But it’s hands off real estate for individuals looking for income. And these are large institutional properties. So you can take your single family rental and you can exchange that for a large institutional asset. And as a financial advisor in those types of situations, we’re looking at diversification. Do you want?

This is modern portfolio theory at its best. Do you want all your eggs in one basket? So we’re going to take these real estate portfolios that are concentrated typically and diversify them out throughout the country and throughout asset class.

Dylan Silver (04:12.046)
So this is very interesting to me, Peter. So this is all brand new to me. So I’m gonna ask some questions. We might go down a rabbit hole here, so bear with me here. your clients, are these folks who already have real estate? You mentioned single family and then exchanging. They already have real estate.

Peter Fisher (04:30.377)
Yes, there’s two components to our business. Again, we’re financial planners, but our company says it all. Sequent real estate plus wealth management. So those two components are real estate, and then we also build investment portfolios with a goal in mind a lot of times, right? Every client’s different, but

The goal in mind for a lot of the families we work with is generational wealth transfer. So they’re thinking, how do I retire and take back my time? And then how do I pass this wealth onto the next generation in a tax efficient manner? Those are sort of two big points that come to the table when we talk to our clients and what their goals are.

A lot of clients do come to us with real estate portfolios. And their challenge is, I don’t want to do this anymore. I’ve spent 10, 20, 30, 40 years managing these properties, dealing with tenants and everything that comes with it. How do I get out of this real estate? Without the tax liability, and I should really say that we’re deferring tax.

removing the tax liability. There’s two guarantees in life, death and taxes. So we’re helping these individuals transition to that second stage, that new life cycle, where they’re able to maintain real estate ownership, defer tax, and receive passive income during retirement.

Dylan Silver (06:21.514)
Okay, so effectively they’re able to have a lot of the benefits of owning the real estate that they owned without having to have the downside, which is the time consuming and the management.

Peter Fisher (06:33.064)
Exactly, right? If you want to really simplify this, they are maintaining real estate ownership and they no longer have the day-to-day operation.

Dylan Silver (06:42.51)
That’s fantastic. I think a lot of people aren’t even aware that that’s a possibility, right? It’s like, I’ve heard people say, you know, little bit of a pivot here, Peter, but I’ve heard people say, I wanna be an Airbnb host, but I don’t love to be a Airbnb host, meaning I like the money from the Airbnb, but I don’t necessarily wanna be dealing with all these issues, changeover, cleaning, bookings, know, damage, yada, yada, yada.

Pivoting Peter though, one of the things that you mentioned as well was that not all of these people are coming to you with an active real estate portfolio. So are you also helping folks who are not current real estate investors, and I’ve never done that before, get into real estate investing?

Peter Fisher (07:23.561)
Yes, this is an area that we work with a lot with clients. The big challenge when you, as an individual, say, well, I want to buy real estate. OK. What does that entail? How much money do you need? Where is the property going to be located? Do you need a loan to purchase an asset? And then who’s going to manage that real estate?

So clients do come to us and we’re able to place them into a variety of different securitized real estate strategies. Whether that is a Delaware statutory trust, whether it’s a real estate investment trust, we have that capability to take individuals into the real estate world and they can build a real estate portfolio with us for their lifetime.

Or they can start with us and build up to enough equity where they can eventually go buy a property on their own and manage it.

Dylan Silver (08:27.03)
Now Peter, selfishly, I have looked at REITs in the past and I’ve owned a couple REITs, I believe fractionally. And what’s interesting for me is being in the real estate game, I would say physically as a real estate wholesaler and as a realtor here in Dallas, and then also seeing the REITs.

I’m curious to what your take is and maybe you’re limited in what kind of feedback you can provide and I understand that. for folks who are comparing REITs versus like let’s call it an index fund, right? How do these two things compare and how would an everyday person evaluate a REIT?

Peter Fisher (09:05.81)
Sure. So a real estate investment trust is often referred to as a mutual fund of properties. The reality is it’s a portfolio of physical brick and mortar assets that are typically geographically diverse and valued in the billions of dollars. So these are large institutional properties.

When we look at REITs at Sequin, we’re looking at these larger portfolios of institutional assets that are managed by extremely reputable sponsors. And to give an example, one of the sponsors that we work with is a group called Cantor Fitzgerald. Now, Cantor Fitzgerald is a name that many of us know. They were in the news after

after 9-11, unfortunately. And they’re one of the largest investment banks in the world, but they offer Delaware statutory trusts, and they offer real estate investment trusts on our platform. The real estate investment trusts that they offer are what are called non-traded REITs. So when you look at a REIT, real estate investment trust can be a, it is a public company.

meaning it has the same filing requirements that Apple or Google or any other public entity does. But as a public company, you have a choice to be a traded company or a non-traded company. So traded mean that it’s on an exchange, right? It can actually be included in some of the indexes that you may own. A non-traded REIT does not trade. So you get less volatility.

You get more consistent valuations and it’s not tied to the stock.

Dylan Silver (11:06.54)
Hmm. How do people get involved in the books?

Peter Fisher (11:08.721)
You know, how do you get involved? You go through somebody like me, a financial advisor that has relationships with these real estate sponsors that manage the REITs. know, Cantor Fitzgerald has this multi-billion dollar REIT that we have access to that our clients utilize for real estate diversification and tax deferral.

Dylan Silver (11:19.948)
Okay, that’s super cool. Yeah.

Dylan Silver (11:34.296)
Hmm. You know, when I think about this area, Peter, it reminds me of some of the guests that I’ve had on who talk about there’s this

syndications is one way that people can invest in real estate as kind of a hands off without having to handle you know the management day to day. I’ve also heard of this fractional investing in real estate. There was two gentlemen that I had separate companies one did luxury real estate investing fractionally in California and all over the world. And this is another opportunity for people to gain exposure to.

to the real estate space in a way that I wasn’t aware that they could.

Peter Fisher (12:19.475)
Yes, this is fractional ownership. And you mentioned the word syndication. The products that we utilize are not syndications. They’re securities. And the real big difference there is regulation. So every product that we work with and every sponsor that we work with are security firms, meaning that we’re regulated by FINRA and the SEC.

So there’s just that little bit of difference of oversight. And for me personally, it gives me more confidence working with a sponsor that is regulated by FINRA and the SEC than a peer syndication.

Dylan Silver (13:03.032)
Sure.

Peter pivoting here, different subject, growing a business and then raising capital, right?

As someone in this space, of course, you’re an asset manager and folks who are many of listening to our show are in the single or multifamily space. They may be fix and flippers. They may be trying to syndicate and raise money for a deal. And I’ve had other folks who may be not doing what you’re doing, but are in a similar field, give their feedback on growing a business and on raising capital as someone who manages assets. What would be your advice to to someone who may be having done a couple flips and they’re

trying to expand and they’re maybe looking at how can I raise capital for additional flips.

Peter Fisher (13:48.999)
Yeah, that’s raising capital is always the biggest challenge and depending on the size of your organization, you’re going to get more or less attention. But you have to have a very clean property and very clean financials. The first thing that I’m going to look at anytime somebody brings me an offering, I’m going to go straight to the financials. And I want to see that you’re covering

your cost, your obligations, and that you have stable cash flow coming out of that investment.

Dylan Silver (14:28.59)
So you have people coming to you all the time basically saying, let’s invest in our deal.

Peter Fisher (14:34.321)
Yes. Yes.

Dylan Silver (14:35.68)
Okay, so you’re the perfect person to talk to about this. So, the avatar really of our listener is someone who’s in that singular multifamily space and a lot of times looking to scale, right? And you get to a point where you’re up against…

you’ve basically depleted your nest egg or not depleted, but you realize you’re depleting it. And in order to keep growing, you have to now look for investors. And for a lot of people, this is not in their wheelhouse, right? Up to this point in time, their skill set has been maybe I’m a contractor and I’m doing this as an investor, or maybe I’m an investor and I’ve figured out how to be a contractor. And now I have to learn this whole other skill set of raising money, which is…

There’s whole groups dedicated to this, right? I’m curious, do you think that this is a skill set that someone can pick up? Is it very time consuming to do so? Do you think it’s better to partner with someone who maybe has that background?

Peter Fisher (15:32.945)
It’s always better to partner with somebody who has that background if it’s not an expertise that you have. That’s going to gain confidence for potential investors. And in that situation you’re describing, who are the first investors? It’s typically friends and family.

And you definitely don’t want to fail when you have friends and family involved. So it really depends on how you promote your investment. Is this a high return investment or is this a conservative stabilized investment? So just making that indication early on to your potential investors will pay dividends in the future.

Dylan Silver (16:20.286)
I heard it’s amazing how this transpires, right? I was at a local event here in Dallas where a lady was speaking about how she got her first investor and it wasn’t a friend or family. So it was that that circle of, I guess you could say the way that she put it, I believe is they didn’t know all the things that I’ve been doing up to this point. So they weren’t as skeptical, but they also didn’t know me. So I had to prove

myself to them it’s almost a a gift and a curse when you’re doing with friends and family because they know all the successes they know all the failures so that’s sometimes difficult but then of course with relative stranger with a stranger you know they don’t know you so you have to build that trust and she was explaining that basically she met this person i believe i want to was even like at the gym and that they ended up doing multiple deals together and through that person’s network

He was basically a bridge to other investors where she was able to raise additional capital. And when I think about this, I’m very, very passionate about networking. call it guerrilla networking or fanatical networking. You you really have no idea, especially as someone who’s not necessarily from a background of capital raising, which connection that you make is gonna be the one that changes the trajectory of your business. So I tend to think, Peter, like if you’re not…

If you don’t know how to raise capital, the best thing that you can do is just constantly be telling everybody, this is what I’m doing, and then just keep making connections and fingers, this sounds a little crazy, but fingers crossed, you come across someone who’s gonna change your business just with intentional daily effort.

Peter Fisher (18:03.955)
Absolutely, and if you have a solid investment plan You’re going to attract investors that want to be in that space with you

Dylan Silver (18:15.13)
Peter, when I think about just the career path of what I’m doing, which is real estate wholesale, I’m a real estate agent, oftentimes it starts out with networking. I remember I was working for a Nissan dealership in South Texas in San Antonio, spending all of my time there. And eventually I saw down the line, I’d like to own real estate. You know, there’s different ways where people can do that if you’re just starting out, but I started out networking, wholesaling.

Now I’m a real estate agent. I’m looking to get my first couple flips. I’ve seen flippers then go into short term, midterm, like corporate housing. Of course you’ve got annual leases. From there people might get into hard money lending or note buying. All different types of avatars, maybe even commercial or medical office space. There’s so many different paths in this business. When you were starting out, Peter, did you see like the five, 10, 20 year goal?

And did you know that you would be where you are today?

Peter Fisher (19:16.167)
When I started out, did I see the five, 10, 20, did I think I was gonna be here in 20 years doing what I’m doing today? You know, it’s a hard question. I certainly wanted to be successful in what I did. And in those early days, Dylan, it’s the same that you said. It’s all about networking. It’s all about picking up the phone and talking to the right people.

going to industry events, you have to put yourself out there.

Dylan Silver (19:50.318)
I guess this is an interesting question here. for, let’s call it college graduates, business maybe, or accounting, and they’re looking at following a similar path, recent college graduates, what general advice would you have for them?

Peter Fisher (20:09.33)
Advice for recent college graduates, it’s such a different world than it was 20 years ago. Today, everything’s about social media.

So for college graduates, just make sure that you are out there networking. That’s going to be the name of the game, getting your face in front of the right individuals. Find a mentor. That’s probably my number one piece of advice, is find somebody that you

Connect with, find somebody that is in the industry you want to be in and mentor with them, learn from them. That’s going to be the key to your success.

Dylan Silver (21:00.568)
Peter, we are coming up on time here. Where can folks go to get a hold of you?

Peter Fisher (21:06.365)
Visit our website, Sequent Real Estate Plus Wealth Management, it’s sequence-rewm.com. And feel free to connect to us through there.

Dylan Silver (21:23.0)
Peter, thank you so much for coming on the show here today.

Peter Fisher (21:27.251)
Thank you Dylan, I appreciate it.