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Show Summary
In this conversation, Vanessa Delgado discusses the complexities of multi-family investments, emphasizing that it is not a quick scheme but a serious business requiring effective management of teams and stakeholders. She highlights the importance of understanding the various players involved in real estate, including investors, regulatory agencies, and customers, to successfully manage and deliver value in the industry.
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Investor Fuel Show Transcript:
Vanessa Delgado (00:00)
And so you kind of have to really know what your buy box is.before you get into that deal because when you’re underwriting a property you have to understand that you’re underwriting there’s an entirely different system of underwriting like a commercial business for retail and underwriting a commercial business for residents and so you know I think a lot of people are getting taking biting off more than they can chew or they’re taking bad loans ⁓ in order to be able to get into a deal just to say that they get into a deal.
You know, a bad deal, doesn’t matter how you package it, it’s still a bad deal.
Dylan Silver (02:12)
Hey folks, welcome back to the show. Today’s guest, Vanessa Delgado, has a biopharma background where she led teams that brought life-changing therapeutics for rare diseases to market and is now in the multi-family investment space with her company, Crecera Capital. Vanessa, welcome to the show.Vanessa Delgado (02:35)
Thank you, Dylan, so much for having me. I’m excited to be here today.Dylan Silver (02:39)
It’s great to have you on here. What I always like to ask us at the top of the show is how they got introduced to real estate.Vanessa Delgado (02:51)
⁓ yes. ⁓ So the way in which I found real estate ⁓ brought me to multifamily ⁓ from essentially having worked in a W-2 for 16 years, being a QC analyst, ⁓ essentially working my way up to management. ⁓ And then I essentially bought a house.And during that journey, ⁓ I had noticed that other people were kind of into the single-family fix and flips. ⁓ And a lot of them ended up losing ⁓ those third or fourth properties during the housing bubble in 2008. And so I realized that I never wanted to be on that side where I saw essentially a foreclosure. ⁓ And so I wondered to myself,
If I were to do it, what would I do differently? And to me, it said, well, why not, you know, apartment complexes? ⁓ Essentially, you’re putting in the same work, you know, you’re fixing it, you’re selling it, but now you’re not waiting on a family to move into the apartment or to the home. And so just made sense that, you know, multifamily really was a way to go.
⁓ And so I saw my opportunity, you know, very recently to get into multifamily ⁓ through creative financing, which is also not necessarily something you’re able to do with single family homes. And so I thought, well, you know, this makes the most sense. ⁓ Why not be able to do this? Because in single family, you’re only benefiting yourself, whereas multifamily, you have, you know, a team of investors.
and you’re tackling a much bigger project together and essentially everybody wins.
Dylan Silver (04:50)
Yeah, I mean, when we talk about the multifamily space and we were chatting before the show, Vanessa, about there’s a really at a big opportunity right now, the multifamily space, because there’s some maybe that’s an understatement. There is a level of distress for multifamily operators who may be bought too deep five years ago. And now they’re having to identify how do they exit or how do they pivot? How do they cut their losses?so to speak. And so I’ve had guests on the show recently and they’re getting into the space and I’m recognizing what an incredible time we’re in right now for folks to get into multifamily. Now I want to ask you specifically, your background in biofarm, I can imagine it lends itself to a high degree of attention to detail and scrutinizing over the minutiae, but also, you know, leading teams. When I think about
multifamily deals, there’s a lot of both of those things. You’ve got to be able to underwrite the deal, which is highly logistical component, but then you’ve also have to be able to evaluate people, really, right?
Vanessa Delgado (06:52)
Yes, absolutely. ⁓ It’s very, important that you ⁓ figure out how to communicate with the team, how to assemble a team, because it is a long-term commitment. Multi-family is definitely not some weird get-rich-quick scheme where you just find a deal and then that’s it.actually happens once you get into the deal. And so that’s important to be able to manage teams and manage a business like an asset. You have to be able to understand how people play, who your customers are, essentially, who the stakeholders are. And I don’t mean just in terms of like stock. It’s actually being able to understand who you’re delivering it with.
or two. So it’s not just your investors, your stakeholders is the state, your stakeholders are the agencies that regulate the safety of the building. So you have to kind of understand how all of these things play and then pick your teams to be able to satisfy that. I think that is incredibly, incredibly important. And with multifamily being the wild, wild west,
That’s where it’s really important to create systems in order to create sort of organization to sort of that wild, wild west, that chaos, you know, ⁓ in order to make sure that the business that you have is successful.
Dylan Silver (08:26)
Yeah, yeah. mean, when we talk about looking at these deals, there’s so many different shapes and sizes that multifamily comes in. mean, on the very small end, you’ve got like very small multifamily, right? Like maybe, you know, a fiveplex or something like this. But on the high end, you’ve got like commercial residential multi use ⁓ apartments with, you know, first layer retail. And so forfolks who are thinking, where do I start? So much of it can be overwhelming, particularly in multifamily. But at the same point in time, I think that also benefits buyers right now because they can understand, you know, some of the mistakes maybe that sellers made when they acquired these properties and help themselves peel back what’s the reason that someone might be selling, you know, right now versus, you know, two years in the future or a year in the past. It’s got to be
either they need to exit or maybe they are in a fortunate position where they’re choosing to exit, but most likely the former.
Vanessa Delgado (09:32)
Yes, that’s incredibly important to make sure that when you’re getting into a deal, you understand exactly what it is that you’re getting into. ⁓ Mixed use sounds incredible, but you know, there’s an entirely different beast of attracting businesses versus attracting residents.And so you kind of have to really know what your buy box is.
before you get into that deal because when you’re underwriting a property you have to understand that you’re underwriting there’s an entirely different system of underwriting like a commercial business for retail and underwriting a commercial business for residents and so you know I think a lot of people are getting taking biting off more than they can chew or they’re taking bad loans ⁓ in order to be able to get into a deal just to say that they get into a deal.
You know, a bad deal, doesn’t matter how you package it, it’s still a bad deal.
So it’s incredibly important that you know what it is you’re after, you know what it is you can raise for, you know ⁓ your due diligence, you know ⁓ exactly what your break even point is, you know ⁓ what the statistics are in that market area for you to have ⁓
you know, the property you say not performing at its most optimal. So it’s really important to do, you know, ⁓ essentially run a risk analysis ⁓ and maybe even utilize some statistics on the end of it just to make sure that you’ve stress test your market. And furthermore, if you’re a newer operator like myself, it’s incredibly, incredibly important that you are in business to the earlier question, to my point of the earlier question.
that you’re working with someone, with people ⁓ who know how to manage that kind of asset that you’ve acquired.
Dylan Silver (12:09)
Yeah, yeah. mean, when we when we talk about multifamily deals, there’s greater reward, but there’s also a lot greater risk. Right. So if you’re looking at, even hundreds of deals, you want to make sure that you’re not so gung-ho that you’re just jumping in. And you want to do that in single family, too. But multifamily, there’s just more risk, especially if it’s syndication. I mentioned this to other guests of the podcast. I actually spoke with a syndication attorney on this show.Who actually provided me some some caution for syndications because any time that you’re raising capital and other people are basically trusting you with with decisions for their money There’s risk associated with that. I want to ask you something that you said when you were talking about, know finding your Pocket or your niche or your asset class in the real estate space and how maybe you know multi-use sounds great, but might
be more of a hassle when you have to find businesses and residents and so on. How are you identifying what markets that you’re looking at? ⁓ Also, what areas within those markets would make the most sense as far as from an underwriting perspective?
Vanessa Delgado (13:24)
So from an underwriting perspective, ⁓ you of course determine ⁓ some of the markets that maybe on the surface have made sense to you. ⁓ you know, a lot of markets, of course there’s a lot of buzz in the multifamily verse ⁓ where you hear about, you know, these markets being really hot.Some markets being cold, some markets you don’t go to. And so, you know, any of the ones that you hear peak your interest, you maybe want to do like a topical, ⁓ a topical, you know, dive into the market. ⁓ But essentially, you do want to check out, you know, various parameters of those markets and start diving further into them.
So essentially you want to kind of narrow down this broad reach into maybe one or two markets that you become really, really well versed in. ⁓ You know what the unemployment statistics look like for the last five years. You’ll look at maybe the population growth trends in the last five years. ⁓ What does ⁓ the job diversity look like? ⁓ Probably most importantly,
supply and demand if you, especially depending on the kind of ⁓ multifamily asset you’re looking at. ⁓ For example, ⁓ I’m looking at value ads. I’m not gonna look at like class A or class B. I wanna know about the vacancies and value ads and how it’s competing against some of the new developments. And then I also wanna just determine,
What additional construction is being ⁓ done, ⁓ you know, in terms of jobs, terms of attracting additional employment? And these are the things that you really want to look into. And then essentially you want to be able to ⁓ put that, you know, ⁓ in the back of your head, especially if you’re trying to look into that area and maybe even, you know, write up a quick market report.
⁓ so that you kind of know off the top of your head, you know, this is what the MSA looks like and then maybe compare it to others around the area. ⁓ So that’s incredibly important in terms of determining where you’re going to, you know, put boots on the ground and start researching multifamily areas.
Dylan Silver (16:44)
I mean, you hit so many points there. when we talk about multifamily, I don’t have personal experience in this space. I come from the single family space, distressed sellers. ⁓ But when we talk about multifamily, so many of the larger economic trends are more important than in, I would say, than in single family. Like you mentioned job growth, right? And, you know, new construction, what’s happening.Vanessa Delgado (17:02)
and that’s all I have for you.Dylan Silver (17:11)
in general to draw people to the city. Those things are important in single family. But when you’re looking at, you know, holding a single family home for five years, you know, and you could potentially have multiple different ways to keep that occupied versus holding multi family. It’s a totally different ballgame. And so when I talk with folks like yourself, it’s always interesting to hear, you know, difference of perspective, but then also recognizing that, hey, this is really the time to buy like there maybe maybe a better time at some point to buy multifamily, but it’s pretty good right now because of so many of the factors ⁓ that we mentioned. We are coming up on time here though, but before I let you go, I did wanna ask you specifically about how you’re managing the ⁓ work as ⁓ biopharma. ⁓
Vanessa Delgado (17:48)
youDylan Silver (18:05)
team leader and someone who’s spent over a decade in biopharma with looking at these multi-family deals, I can imagine it’s probably more than a full-time job with everything considered.Vanessa Delgado (18:21)
Yes, ⁓ I’m excited about multifamily. And so for me, ⁓ it’s not like a second job. I think it’s another endeavor. It’s something that, you know, ⁓ it’s a passion that I’m chasing. And so I don’t mind, you know, utilizing my weekends to look into it, ⁓ meeting with additional people. ⁓ I think that’s probably the most exhilarating part of it is thatyou meet other people in the industry. So it’s not like you’re going at it alone and you have people who have the same vision and the same goals that you do that you feel exhilarated because there is definitely ⁓ momentum in the energy and it propelled you to move forward, especially when you realize, you know, the amount of good that you’re doing for investors, for tenants, for yourself, for your family. ⁓
So to me, it doesn’t really feel like a full-time job at all. ⁓ You know, I’m excited about this podcast. I’m excited every time I meet with my business partner. It is an amazing time to be in right now.
Dylan Silver (19:38)
⁓ Vanessa, I want to thank you for coming on the show here today. Where can folks go to learn more about what you’re doing and how can they learn more about Crecera Capital?Vanessa Delgado (19:51)
I would say shoot me an email. ⁓ It’s found on my website. It’s [email protected] ⁓ You can go to my LinkedIn page, my Facebook page, my Instagram page. ⁓ I am so happy to have a chat with anyone who wants to learn more about multifamily or what it’s like working with me or⁓ what I’m specifically looking for in multifamily and what my journey has been like so far. ⁓ Yeah, I’m totally open.
Dylan Silver (20:31)
Vanessa, thank you so much for coming on the show here today.Vanessa Delgado (20:36)
Thank you so much, Dylan.
