Building a $150M Halal Real Estate Fund Without Interest

Yamundow Camara (00:00)
Don’t wait to buy real estate, buy real estate and wait. And I’ve actually trademarked this statement. Now it’s mine. But what I want to say is invest in real estate is not as hard as people do it. You don’t have to be completely involved. Some people are busy. They have a nine to five. Nobody—if you love your job and you you love what you’re doing and making money, but you know that real estate is where you want to put your money. Always invest in real estate somehow, whether it’s

hands-on or passive or not passive, be able to put your money in an asset that will always produce money for you.

Dylan Silver (02:05)
Hey folks, welcome back to the show. Today we’re joined by Yaamu Camara, the managing partner of Building Wealth From Rentals, combining expertise in real estate, data science, and programming to help investors build wealth through strategic real estate investments. Yaamu, thanks for joining us here today.

Yamundow Camara (02:22)
Thank you so much for having me. It’s a pleasure. My name is Yaamu. I am originally from West Africa. I started investing real estate in 2020 and scaled my portfolio to 156 rentals within four years. That’s a mixture of short-term rentals, Section 8, and midterm rentals. And later on, because I’m a Muslim, I’m not supposed to be taking interest loan. I did it anyway, because like everyone makes excuses for themselves. I decided to be intentional and stop taking loans in 2020 and I started a real estate fund.

A halal real estate fund, meaning no interest. So basically what it means is pool investors’ money. The fund pools investors’ money to buy multifamily hundred-plus-unit B-class and share profit 70/30, 70% to the investors and 30% to my company, and also pay investors eight percent pref return. So the investors get paid twice before I do. So that’s the whole point of DeenVest Capital.

Dylan Silver (03:17)
Now, when we talk about interest-free financing and your structure specifically, walk us through that. Is this a syndication? How does this work?

Yamundow Camara (03:27)
Yeah, so it’s a fund-to-fund and the goal of the fund is to—with my religion, you’re not supposed to take interest loan or the other person that you’re doing business should not feel like they’re being oppressed like the bank. If you miss payments or you can get foreclosed on and you can lose all the payments you’ve made. Whereas in my model is where, you know, you can say, hey, I can’t take a loan from the bank, but I do have a hundred thousand or I do have a fifty thousand, I do want to invest in real estate.

So you can see in most Muslims community, and this is open to Muslims and non-Muslims alike. It’s not just Muslims. And the Jewish have been doing this a long time, where they put money together and buy a whole block. It’s basically the same mechanism. But in our case, it’s—we’re being fair and paying the in the investors eight percent pref return and then share the profit. So it’s a spread profit-share model. And when we eliminate the debt, we only have so less expenses like insurance, maintenance, and all that other stuff.

We don’t—we hold the property three to five years and then we sell at a profit. If we decide the market, because in real estate markets go up and down, if the market decides, you know, it’s down right now, we hold it off because there’s no mortgage payment, there’s no pressure. And the investors get paid monthly. So they—we do the monthly distribution instead of quarterly. So you get your return right away when we close. Our goal is always to get in the property at least six percent cap rate, but we want to put it at eight percent. So

because in our religion you cannot guarantee payments, it’s preferable based on the performance of the property.

Dylan Silver (04:58)
You mentioned a three-to-five-year hold time. But also, you know, if the deal is not able to be exited at that time, you—it’s not like you have a bank saying, you know, our loan is due. So you do have the more flexible nature of these deals. Now, when you’re talking about how this looks with communication with the investors, what are the expectations that that you set on the outset so that everyone is on the same page?

Yamundow Camara (06:13)
Yes, so the investors do. So these are investors that have money in the bank and then don’t want to invest. So regardless, as a Muslim or a faith-based investor, you have money in the bank. The interest that is piling up, we’re not supposed to touch it. So I have a lot of people approach me, small business owners and everyday people, say, hey, I have money sitting in the 401(k). Can I invest? That money is what you use to invest in this type of assets and then the return is exponential, basically, because you don’t have to do anything and you get money

piling up as we go. However, to your question, when you’re getting into the deal, you already know that you’re gonna get at least six percent return. ‘Cause in the market right now, getting eight percent pref return is very high. So we give you at least six percent pref return. And in a couple of months where we acquire the property, putting value, adding value to the property, then we make you whole when the property is stabilized. However, you do know that, hey, we haven’t bought a property yet or the property is under contract.

I’m putting my money now, but the property might be under contract in six months. It’s a understanding that, you know, that money is not generating interest for us or you. So it’s sitting there until we actually put it into work. So there is that understanding of that.

Dylan Silver (07:26)
Now, the lion’s share traditionally of the profits comes at the time of sale, but it seems like you’re also talking about taking distributions and becoming whole before the sale of the property. Is that correct?

Yamundow Camara (07:41)
Yes, so every month you get your cash flow and when we sell, it’s split seventy-thirty. And the cash flow is also seventy-thirty.

Dylan Silver (07:51)
Pivoting here, when we talk about finding these deals and acquisitions and the that whole side of this space, one of the most challenging things is, in many cases, these larger deals are sometimes behind a cloak-and-dagger, right? You have to know the right person, you have to have a broker who really is looking for these deals, many cases off-market, you have to go direct to seller. And there’s so many different acquisition strategies, but it’s very, very competitive. And many people will sit on the sidelines for years

because they’re waiting for that right opportunity. How do you approach acquisitions?

Yamundow Camara (08:25)
Okay. So I use my background and my contacts that I had building my portfolio a couple of years. So right now what we’re doing, what I’m doing is actually reaching out to different brokers and putting myself out there, whether it’s conferences, whether it’s just local broker events, every kind of situation that I could get myself in, whether it is an event, a conference, just going online and reaching out to brokers, that’s what I’m doing right now.

And word of mouth goes out because the minute I say I’m all-cash-based and I’ve raised this couple of millions, they want to listen, right? Because it’s all cash and broker. It’s all about commission for them. And we’re finding that when we make an offer on a project or send an LOI and attach our documentation, we really get a discount. Like, okay, we can—if a property is going—so our first raise is 20 million, right? Right now we’re at nine million raised. When we show our proof of income, it shows like,

you guys have a couple of millions to raise. This property that we’re selling is fifteen million, but we can bring it to fourteen. Instantly one million off because it’s a cash offer, because cash is king.

Dylan Silver (09:35)
Now, when we talk about, you know, being able to start this fund, right, was this a lengthy legal process and was this something that was new to you at the time? How did that come about?

Yamundow Camara (10:21)
Yes, it was new to me. Like, me coming from my tech background, I always love to do research. Even me fumbling into real estate and found my way and building my portfolio, finding ways and reading books and connecting. I already knew about syndication. I already knew about funds. I didn’t know I was gonna do a fund. I was actually gonna do a syndication because I have people in my network that will say, hey, I have this much money, I want to partner with you. And I’ve never partnered before. All my portfolio is hundred percent mine, of course, with lending with the bank.

But I never thought of, like, creating a fund. So it’s like, you know what? How about instead of doing per property, which is syndication, how about I do with a fund? And I set it up to a hundred-and-fifty-million-dollar fund and our first fundraise being twenty million. So it’s not like I jumped into it. I did my research. I learned, followed fund managers. I have been in contact with fund manager that are doing what I’m doing, but my model is more of, you know, cash-based. But yeah, a lot of legal work, a lot of attorneys probably took us about

maybe seven to eight months to just get the paperwork done. And it being halal, we have to also have the Muslim part of it being scrutinized. So everything that our attorney did documented with the SEC has also have to go through with the Shariah compliance. So they have to look at it and say, okay, this is Shariah-compliant. You can’t do this. If you want to do this, you have to come out of pocket for this ’cause the investors did. So it’s very fair and very thorough. So it takes time for that paperwork to be done.

And we have to give certification for it too as well, to be Shariah-compliant.

Dylan Silver (11:52)
Now, that conversation on both sides, you mentioned it being Shariah-compliant, but then also with the legal side, these are two separate conversations. Yes. When you’re when you’re discussing this with one side versus the other, are they approaching it also thinking about the legal side, also thinking about, hey, is this going to be Shariah-compliant? Or is that really up to you to determine, is this going to work out?

Yamundow Camara (12:18)
Yes. So the Shariah components have different categories. They’re different types of doing something halal. So there is the Wakalah and there’s other methods. So our legal aspect had to be like, this is how the SEC wanted. And then our Shariah compliance will say, well, then you guys can do this option A. You—you have to do this option B, where you can only take one percent

acquisition fee or this percent acquisition fee because then it would not be fair or this and that. So the legal, the SEC part, there’s no changes. We can’t do nothing about that. The Islamic part has to tell us where we fall into and what we can supplement, what we can do. So it was like a back and forward, and there’s some things that we thought that is 100% halal because it’s all no interest. But then it turns out even the contracts in the documents with the investors have to be halal

because nobody should feel like they’re oppressed. And I was like, it’s a learning process for me. Even as a Muslim, I’ve never—I just thought it’s cash-based, so definitely there’s no interest here. But the documentation, the contracts, everything has to be halaled. So finding that out and learning the process was amazing, and it was exciting to be part of it.

Dylan Silver (13:29)
When we talk about the establishment of the fund and then also how that first deal went, were there any pivot points or major milestones that come to mind where you felt like, okay, this is now a a new, you know, frontier that we’re entering?

Yamundow Camara (13:47)
Yeah. So right now we are under contract for a multifamily asset. We haven’t closed yet. We’re in the due diligence process. But, like you said, it’s we’re learning as we go. We’re just making sure that the investors get what they want, what we promised them, and also to be able to stand on on ten toes, like they say, on what we have promised them.

Dylan Silver (14:12)
Let’s talk about this multifamily deal. So where’d you—where’d you find it? Where is it based out of? Is this a a value-add opportunity? Is there any distress in this deal where you have an opportunity to do some rehab? What’s this deal look like?

Yamundow Camara (14:24)
So it’s three hundred and fifty-four units in Dallas, outside of Dallas. And it, of course, needs—it’s two assets. One is one hundred eighty-eight, and the other one is one sixty-six. So the assets, of course, are value-add. One is a C and one is B. So the one that is C is the value-add that we wanna—is C-plus. So it needs some work for us to put it to a B level, which will be easy because all the other assets around them

are in the same category. So the goal is to take, because I have a midterm rental background, I have contracts with companies like Comcast and installation companies. Our goal is to take those contracts and move it into the hundred—the hundred-plus unit to subsequently add or triple the income. So we’re hoping that the deal closes, but of course we have to make sure we cross all the T’s and dot the I’s.

But yeah, the deal is amazing and the returns are amazing, to just be part of a process like that, even if you’ve—we’ve never done—I’ve never done a multifamily asset that big. I’ve only done a hundred-plus. This was a challenge, and just learning through the process is amazing. My partner in this company has a background of raising capital.

I’m more of—well, I’m learning to raise capital as well, but more of a an operator. Because I like the ins and outs of, you know, management.

Dylan Silver (16:35)
This deal in DFW, you mentioned it’s a C-plus-to-B asset. Do you know off the top of your head what rents look like in these units?

Yamundow Camara (16:44)
Yeah, so it’s a mixture of one-bedroom, two-bedroom, and three-bedrooms. The one-bedrooms are going for a thousand and forty-five. The two-bedrooms, a thousand three. Some of them, the classic units, are going for less. And the two-bedrooms are more of—it’s a mixture of like a condo kind of situation, and those are going between eighteen hundred to two thousand.

Dylan Silver (17:04)
Okay. And then once you have acquired this property and have done some of the rehab, is there a projected rent raise that you plan on doing typically and in this deal as well?

Yamundow Camara (17:17)
Yes, yes. So like I said, it’s two assets. The one that is C that needs the work done, that one for the one-bedrooms is about a hundred and ten dollars, around that, for the increase. And we have le—we have more one-bedrooms than two-bedrooms and more two-bedrooms than the three-bedrooms. And for the two-bedrooms, that’s where the significant amount of work is needed. We’re projecting about three to four hundred dollars increase in that.

Dylan Silver (17:44)
Pivoting here, when we talk about managing rehabs, one of the things that comes up, regardless of the scope and the size of the deal, is managing contractors and subcontractors and timelines and expectations, right? But you also have investor money tied up in this as well. So there’s even more expectations and communication that need to be had. When you’re managing contractors at this scale, well, what is the some of the keys to success, right?

Yamundow Camara (18:13)
Yeah. So I—that’s where I come in. That I love, by the way, managing contractors, all of that. Because I started from coming from Africa to the U.S. to managing my own contractors out of state. So I live in Georgia, but most of my properties are in the Midwest. So buying out of state is not new to me. This is something I’ve done for the last six, seven years. But, to back to your question, because I come in with the operator mindset with my technical background, I

love to be boots on the ground. So before, like, when I’m travel, when I’m managing a project outside—out of state or in state, I’m always on—I’m always at the job site, all the time managing. So my strategies, I make sure everything is strategized. I have documentation, the steps to take, whether it’s working with the city, pulling permits, to working with investors, contractors directly, or subcontractors. Most of the time I would work with the general contractor.

Most of my projects that are smaller, I used to work with general contractors and subcontractors. But projects like this, I’m definitely getting a huge property management company and also working directly to manage—micromanage them, like you say.

Dylan Silver (19:24)
Yeah, I mean, it’s one of the big things that becomes a source of pain or frustration, of distress, when we talk about these deals, is, you know, a a poorly managed contractor or issues with expectations, or, you know, contractor walking off without the job being completed. And so when you’re looking at scale like this, of course that becomes ever so more important.

One final question here for you, Yamu. You know, when you’re looking at these deals out of state, you mentioned being in Georgia. Are there any particular methods or processes that you use as an out-of-state investor that you want to share with our audience?

Yamundow Camara (20:06)
Yeah, so I use different methods and systems when it comes to contractors, right? A lot of questions that I get is like, how do you find contractors, right? I have a method that I call Yamu Method. When I travel to the state, right, I go to the Home Depot stores and I’ll leave a sheet there at the Home Depot store or home improvement store. I’ll go to all of them. I would have Googled them already and I have a sheet. I take it to

a manager in place that you do back orders from. Yeah. I will go there and leave a sheet there, probably get them a gift card or something. Some companies don’t allow it, but most of them do. And I’ll leave a sheet there and say, I’m looking for contractors, and I would love to leave the sheet here. The sheet has name, last name, contacts, it has email, and it has availability time. So you put—so name is Dylan, you say Dylan Silver, available in the next three months. Your skills.

I’m a plumber, I’m an electrician, or I’m a roofer. So by the end of the day or end of the week, I could go back and get a list of all those sheets with different locations. So I’ll get multiple of them. Some of them are available now, some of them are not available now. Doesn’t mean I have to use them all. But what I do is go back and actually call each of them and have a conversation. Some of them I know right away that I’m not never gonna work with this person, right? So your red flag. But someone’s like,

okay, tell me about your experience. And they go tell me, I built this, I did that, I’ve been doing this for this many years. I’m an electrician for the last 20-something years. My license is up to date. I’ve worked with the city before. These are qualities that I look for. So, of course, yes, this—I love doing this. So it’s—if time allowed, I would have said more, but yeah, that’s one of the ways. I’m detailed, I’m hands-on.

Dylan Silver (21:52)
We are coming up on time here, Yamu. Anything you’d like to mention directly to our audience?

Yamundow Camara (21:58)
Yes, so I always say don’t wait to buy real estate, buy real estate and wait. And I’ve actually trademarked this statement. Now it’s mine. But what I want to say is invest in real estate is not as hard as people do it. You don’t have to be completely involved. Some people are busy. They have a nine to five. Nobody—if you love your job and you love what you’re doing and making money, but you know that real estate is where you want to put your money. Always invest in real estate somehow, whether it’s

hands-on or passive or not passive, be able to put your money in an asset that will always produce money for you.

So the goal is to build generational wealth, like they say. I know it’s old—people talk about generational wealth, generational wealth. But even if it’s not generational, I rather have my money being in an asset and producing income for me than being in the bank and the bank using it to make money and just give me a fraction of it. In my case, I can’t even take that income.

Dylan Silver (22:52)
Yamu, thank you so much for your time today. Thanks for joining us.

Yamundow Camara (22:56)
Of course. Thank you so much. Thank you for having me.