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Show Summary
In this episode of the Real Estate Pros podcast, host Erika speaks with Brandon Howliet of Branstar Capital about his journey in real estate, focusing on multifamily investments. Brandon shares insights on transitioning from single-family homes to multifamily syndication, the importance of building a strong team, navigating market challenges, and finding the right deals. He emphasizes the need for education, networking, and maintaining integrity in the real estate business, offering valuable advice for aspiring investors.
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Investor Fuel Show Transcript:
Brandon Howliet (00:00)
yeah, I could share a couple. success is not a straight line. You’re gonna have some jagged edges, and some twists, and some turns, right? But you have to stay on that road, right? And you have to know what you’re in it for, right? And you have to be able to fully commit, ⁓ because you only lose if you give up.Erika (02:00)
Hey everyone, welcome to the Real Estate Pros podcast. I’m your host, Erika and today I’m excited to be chatting with Brandon Howliet of Branstar Capital. Brandon, it’s awesome to have you on the show today.Brandon Howliet (02:13)
Hey Erika thank you for having me.Erika (02:15)
Yeah, yeah. So, you know, let’s dive on in Brandon for our listeners who are really familiar with your world. Can you give us the rundown and share how you got started in real estate?Brandon Howliet (02:26)
Okay, yeah. Right now I’m what’s called a multifamily apartment building syndicator. You know, that’s a big word for ⁓ an apartment building ⁓ investor, right? So, I got started on my journey about 20 years ago, 2002. Started investing here where I’m based out of in Chicago. Single families in two flats. We purchase our home that we’re still in now.a single family home and ⁓ a two-flat. ⁓ Held those two for about two to three years, flipped those, ⁓ made some good profit on those deals, ⁓ decided to do it again, ⁓ caught the bug, ⁓ held on to another ⁓ three properties for another three years or so, ⁓ made a profit on those, did it again, but in 2008…
We kind of got hit with the ⁓ onslaught of the real estate crash ⁓ like the rest of the world did. So we ⁓ recalibrated, went back into ⁓ investing in 2012, purchased a laundromat in Chicago, kept that for a couple of years, sold it, and went back into real estate solely as a wholesaler and a fix and flipper.
Around the time of COVID, I started studying multifamily apartment buildings. And that’s ultimately where I wanted to be. I had a lot of time sitting on the sidelines studying. But in 2022, we finally decided to take the plunge and joined a mentoring program. And we’ve been in multifamily ever since.
Erika (04:16)
That’s awesome. So what drew you the multi-family? Because that’s quite a change from before.Brandon Howliet (05:10)
Yeah, it’s just the fact that you can get there quicker to where you’re trying to go. You can scale it. ⁓ And fixing, flipping, ⁓ and the single family world, each project you’re making another job for yourself. And I’m not the most handy man, but ⁓ I do like ⁓ doing the deal and managing the deal and managing the assets.That’s what my strength is. So that’s why we decided to go into multifamily. And you make money passively. You save a lot on taxes and it’s more profit in this game.
Erika (05:52)
That’s awesome. And as you’re growing and scaling in the multifamily world, how have you been managing with growing and scaling? Are there any systems or any teams that you’ve built to help with that?Brandon Howliet (06:06)
Yeah, in multifamily, as we say, teamwork makes the dream work. you can’t do this alone. So it’s all about you as the operator. It’s all about your key principle. You know, that’s usually the person who can sign for the loan for you and the rest of your team who are the active operators, the general partners, you know, who help you with.earnings deposit, other soft costs in the deal, inspections, so on and so forth. But the property manager of that property really makes you or breaks you, right? So you really have to ⁓ lean on them because they’re ultimately the ones who are ⁓ managing that property and you’re basically managing the property manager. So the property manager is really ⁓ the most important.
entity in this area.
Erika (07:03)
Keeping in mind that importance there, how do you go about picking if someone is a good fit for you to hand them to the keys of your business?Brandon Howliet (07:11)
Well, basically, you know, ⁓ in your market, whatever it is, ⁓ like our market is ⁓ Texas, DSW area and Louisville, ⁓ Kentucky. So ⁓ I’m in a network of operators where, you know, I’ve got the luxury where if I’m in a certain market, you know, I can reach out to them. I can get referrals from the best. ⁓two or three property managers in that area, and you interview them. And we ask them a list of, say like 20 questions that pertains to multifamily, right? And if they don’t answer all those questions ⁓ correctly, you pretty much know what you’re dealing with. But ⁓ referrals and ratings are really ⁓ what you go by, and they’re past performance.
Erika (08:02)
really helpful. Let’s talk about the the markets that you’re in, Brandon. What kind of opportunities or challenges do you see in Texas and Kentucky in multifamily?Brandon Howliet (08:13)
challenges right now are with Texas at Kentucky. ⁓ it’s got a lot of growth and opportunity there and that comes with a lot more operators zeroing in on that market. the present deal that we have now that was set to close on, ⁓ the first week of November, we were actually one of nine groups that went after that deal, right?But my particular investor base is based in Dallas and they’ve done deals and actually we’ve done deals there multiple times with that specific broker. So, you know, we were given the edge ⁓ because of that relationship that we had. But had we not had that relationship, we may not have gotten that deal. So, yeah, so it’s all about the market.
So all about your contacts and your relationships and your experience within that.
Erika (09:47)
Yeah, speaking of relationships, what’s been instrumental to you, whether it’s been your growth as an owner or scaling your business?Brandon Howliet (09:57)
⁓ Instrumental, just getting my face out here, ⁓ meeting as many brokers, as many operators, as many property managers, as many investors as I can, and staying ⁓ true to who I am, having integrity, right, and having a good reputation.One of the deals that we closed last year, December, 2024, was 113 unit townhome community in Louisville. That was a $24 million acquisition. And that was actually, it actually capped off a real challenging year for us, right? But throughout that year, people were noticing like, you know, the work that I had been doing.
⁓ My activity and just my drive and we were actually invited to raise on that deal, right? So had I not put in all that work throughout those couple of years, ⁓ I don’t think I would have been invited to it.
Erika (11:03)
People notice when you’re working hard there. Brandon, I know we talked a little bit earlier how you survived the crash and maybe that was the biggest crash in your life or maybe there were some deals that went sideways and you had the pivot. Can you share one of those moments on your journey and what you learned from it?Brandon Howliet (11:25)
yeah, I could share a couple. success is not a straight line. You’re gonna have some jagged edges, and some twists, and some turns, right? But you have to stay on that road, right? And you have to know what you’re in it for, right? And you have to be able to fully commit, ⁓ because you only lose if you give up.Right. So one deal that we had under contract, this was maybe a couple of years ago, 2023, I think it was a deal in San Angelo, Texas, 52 unit, a beautiful property, four different buildings. But you always have to have an inspection, right? So during the inspection and you really don’t find these
source of details out until you get inside these deals, right? So any large apartment building that was built before 1979 was built with galvanized piping, right? And during this time now, that piping is wearing down. all of the piping and the sewer lines should be changed ⁓ to PVC. So, you know, and that’s just my advice.
like operator, you know, who’s listening ⁓ to this now. So we finally got in there. We got the sewer line inspected and we found some things that we didn’t like. And we went to the seller and he wasn’t willing to give us any credit for it. So we passed on that deal. Right. So, ⁓ you know, that’s just, you know, a lesson that you have to learn, but, but that the price tag on changing out that pipe, it would have been over.
$150,000, know, but and that just would have blew away, you know, all of our profits for our investors on that deal. So I could have pushed it through, but you know, but investors would have lost money. So your number one goal and purpose as a operator, you have a fiduciary responsibility to your investors, protect their investment.
and make sure that they don’t lose money. So that’s why we did that.
Erika (13:43)
Yes, absolutely. it’s important to know that you can say no. Yes is not always the right answer. Don’t be anxious doing a deal.Brandon Howliet (13:52)
Yeah.Yeah. huh. Every deal is not a good deal. You know, you know, we went through before we found that deal. We, we looked at almost, ⁓ a hundred deals, you know, and that’s just, ⁓ that’s just the nature of the beast. So, and we’re looking at deals now, you know, ⁓ took us another 60 deals, you know, to find the deal, ⁓ that we’re in now. So, ⁓ that’s just a part of the work. That’s all.
Erika (14:18)
Yeah, and speaking of which, what kind of deals are you saying yes to right now and what’s next on the horizon?Brandon Howliet (15:07)
Yeah, typically what we look for 30 units to 200 units in Texas, DFW area, Louisville, Kentucky, between ⁓ anywhere from 2 million to 25 million, right? We choose those numbers because ⁓ those deals tend to qualify for it.agency debt, Freddie Mac and Fannie Mae, which give the best rates for us. The metrics that we like to hit for the deal is at least 19 % average annual returns, 6 % cash on cash, 15 % internal rate of return. And that usually works out very well for investors. And actually now,
⁓ Those are the exact numbers that we have on the deal that we have now on the table.
Erika (16:07)
exciting. I’m sure a lot of people listening today want to end up where you are today Brandon. So if they’re getting started in real estate and investing, what kind of advice would you have if they’re starting from scratch today?Brandon Howliet (16:21)
Mm, that’s starting from scratch today. Well, when I first started, I thought that you had to start small to become bigger, but you really don’t. You can start with multifamily. You just have to have the education. You just have to have the network and the community, right? And in order to get all three, I would…you know, get with someone that’s ⁓ doing what you want to do ⁓ as an operator, ⁓ reaching out ⁓ to them, ask a shout out to them, you know, ask them questions. If you can afford it and it’s in your budget, you can hire a mentor or join a mentoring program to teach you everything that you need to know because ⁓ it is an education, right?
I know a couple of operators who started with like a million bucks, right? But if they don’t have the knowledge and the know-how, you know, they’re going to lose that money. So yeah, so I would say educate yourself, invest in yourself, get as active as you can in your ⁓ community or in your market that you’re in. Join all meetup groups for multifamily, ⁓ Facebook groups, social media, get yourself a website.
And just get out there, you know, and just let everybody know around you what you’re doing. ⁓ Get some sort of ⁓ software to be able to teach yourself how to underwrite deals, because that’s key, because getting into a multifamily business is just that, is buying a business, right? So if the numbers don’t work, the deal won’t work. So yeah, so just educate yourself and stay the course.
or you can even reach out to me if you want.
Erika (18:13)
love that Brandon and actually I was going to say that anyways because you know someone listening today wants to reach out how should they reach you and I know you’ve got some exciting stuff going on that you want to share too.Brandon Howliet (18:24)
Yeah, our website is branstarcapital.com. You can reach us there. You can sign up for our newsletter, look at our history and our portfolio, what we’ve got going on. You can email me there and you can call me also from that website. We also have a monthly mastermind.that we have with my Dallas group. That’s every first Thursday of the month. You can reach out to me also if you want some information on that. ⁓ And we have ⁓ also a weekly meetup group in Dallas as well. You can get on that invitation list as well.
Erika (19:14)
show today sharing your story and your expertise. I think you’re really sharing what’s possible in real estate. It’s exciting.Brandon Howliet (19:22)
Yeah, so don’t be afraid, just educate yourself, ⁓ stay the course, and you never lose if you never quit. So just keep at it.Erika (19:34)
I love that. Thanks again for being here. And for our listeners today, if you got value from this episode, make sure that you’re subscribed to the real estate pros podcast. We’ve got more conversations lined up with experts like Brandon who are out there building fantastic real estate businesses. We’ll see you on the next episode.Brandon Howliet (19:55)
Thank you. ⁓
