Generational Wealth w/ Commercial Multifamily|Clive Davis on Leaving a 20 Year Corporate Career

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Show Summary

In this episode of the Real Estate Pros Podcast, Clive Davis shares his transformative journey from a corporate lawyer to a successful entrepreneur in commercial multifamily real estate. He discusses the challenges and learning curves of transitioning to entrepreneurship, the importance of resilience in navigating market fluctuations, and his insights on building generational wealth. Clive emphasizes the significance of taking action and not getting stuck in analysis paralysis, while also sharing his experiences in ground-up development and the mindset needed for success in real estate.

Resources and Links from this show:

• • • Investor Fuel Real Estate Mastermind
    • Investor Machine Real Estate Lead Generation
    • Mike on Facebook
    • Mike on Instagram
    • Mike on LinkedIn
    • Clive Davis’ Website
    • Clive Davis on LinkedIn
    • Clive Davis on Instagram
    • Clive Davis on Facebook

  Listen to the Audio Version of this Episode

  Investor Fuel Show Transcript:

  Clive Davis (00:00)
  Yes, I wouldn’t say that I had a shift with respect to money because I always think that I’ve had a very positive relationship with money and kind of just how I think about money. And I’m very determined in terms of kind of what the future holds for me. And so, you know, I talk about being the first in my family to create generational wealth and everyone defines that differently. But for me, it was basically just manifest in the fact that

  not only are my children gonna be in a good position, but my not yet conceived grandchildren, when they arrive, whether I’m here or not, they will have a foundation upon which they can stand and do very well. So that’s what I talk about when I talk about creating generational wealth. And so that’s been my kind of compass and focus.

  Kristen (02:20)
  Welcome back to the Real Estate Pros Podcast. I’m Kristen and I’m here with Clive Davis. After a 20 year corporate career, this former Wall Street lawyer and later a farmer executive decided to take an entrepreneurial journey and dove head first into the world of commercial multifamily real estate. He’s the owner of Park Royal Capital and I’m excited to get into it. Thanks for being here, Clive.

  Clive Davis (02:39)
  Thanks for having me, Kristen.

  Kristen (02:40)
  So let’s go back to the beginning. mean, you obviously had a big corporate career before going into real estate. Tell us all about that.

  Clive Davis (02:46)
  Yeah, so I started out first as a corporate transactional lawyer with a Wall Street firm. So that was my reality several years out of law school, New York City. Very early on, I made the recognition that that was not something I wanted to do for the rest of my life. And so I kind of navigated out of the Wall Street firm scenario into an in-house position.

  started working for a pharmaceutical company, Pfizer, also their headquartered in New York City. And that’s what took me down the farmer path. And I spent about 15 years with them in different legal and compliance related roles before making my escape at the end of 2016. At that point, I’d done about 20 years and got to a point where I just said,

  if not now, when? And just basically asking the question, you know, have this interest in real estate, you’ve kind of flirted with being an entrepreneur, what exactly does that mean? Do you have what it takes? Do you have the guts, the courage to try that? And so I just got to a point where I was in a position where I could step away and I had the luxury of being able to take a leap and seeing how it turned out.

  I haven’t turned back since and that’s about nine years ago and I’ve been focused on commercial real estate since then.

  Kristen (04:09)
  Amazing. How did that feel to kind of go from such a structured environment to, you know, essentially being your own boss? What were some of the learning curves there?

  Clive Davis (04:17)
  somewhat scary. I think whenever you’re kind of, stepping out of your comfort zone and trying something, that you’ve only thought about theoretically and you’re now you’re actually trying to do it. there’s a lot of fear and kind of trepidation that goes along with that. there’s a lot of unknowns. And so as I look back in hindsight, you know, I kind of made a kind of a cold turkey.

  transition. I didn’t like plan it over two to three years and kind of lay the path, which is something that, you know, in hindsight, I look back and say, there’s some things that I could have done differently that would have made for a smoother transition. Definitely, you miss the consistency of that direct deposit every couple weeks. And so that’s a big miss. And so just getting comfortable with the uncertainty of kind of cash flows and income and

  And what does that mean for you personally? And by extension, your family, all of that was new to me. You know, I had, I think since I left the house for college, I had been in a position where I always had more money coming into my household than was leaving my household on a monthly basis. And when you put on that hat of being an entrepreneur after, you know, 20 year corporate career, all of that.

  Kristen (05:23)
  Hmm.

  Clive Davis (05:30)
  you know, gets turned on its head. And so you have to get comfortable with lots of uncertainty. And that’s kind of been my reality and continues to be my reality, frankly.

  Kristen (06:28)
  Yeah, absolutely. And I’d love for you to talk a little bit more about, you you have this stable paycheck and then you’re trying to go from, you know, building money to building wealth and maybe you have to take some steps back with your finances to get there. Can you just talk about that whole process?

  Clive Davis (06:44)
  Yeah, absolutely. I would say that the saving grace for me was that there was not a significant adjustment in lifestyle. Like I you know at the time that I left, I had no car notes. All of our cars were paid off. The only real debt that I had was associated with real estate that I owned, either that I lived in or that I owned as an investment. We had no

  vacation, no family vacation home somewhere where we were trying to cover that mortgage. So we very much were living inside of our means and probably below our means. So there was no dramatic adjustment that we needed to make now that the high W-2 income was not there. My wife had been home for the better part of 17 years while I was working in corporate. And so she

  took that opportunity to return to teaching, which was her career early on. You know her passion and her love is teaching kids. And so we kind of switched roles in that she was able to go back to teaching kindergarten. And I became the kind of stay at home dad who’s kind of launching this business out of, you know from the dining table. And yeah, that’s how we did it.

  Kristen (08:00)
  Was there any mindset shift you had to get past? I mean, I think a lot of people get in their own way when they’re building wealth. Maybe they feel like it’s not possible for them. People have, you know, maybe different relationships with money as they grow up. What would that look like for you?

  Clive Davis (08:15)
  Yes, I wouldn’t say that I had a shift with respect to money because I always think that I’ve had a very positive relationship with money and kind of just how I think about money. And I’m very determined in terms of kind of what the future holds for me. And so, you know, I talk about being the first in my family to create generational wealth and everyone defines that differently. But for me, it was basically just manifest in the fact that

  not only are my children gonna be in a good position, but my not yet conceived grandchildren, when they arrive, whether I’m here or not, they will have a foundation upon which they can stand and do very well. So that’s what I talk about when I talk about creating generational wealth. And so that’s been my kind of compass and focus.

  And so, positive mindset in that regard, but definitely when you spent 20 years in corporate,

  you have certain limiting mind beliefs about you know what it is to be a corporate citizen and you know what it is to be an entrepreneur. and so you know over here, when you’ve not done that before, there’s a lot of unknowns around that. So you have to adopt a mindset that says, I can, I will, all of those derivatives to just continually remind yourself that.

  what you’re embarking on is something that you can and will achieve.

  Kristen (09:39)
  Absolutely, I I think that’s a great mentality to have. Talk about kind of the resilience you’ve had to have throughout your real estate career because I know that the market is always shifting, you’re having to adapt your strategy, what does that look like?

  Clive Davis (10:26)
  Yeah, so when you get into this business and for me, I’m syndicated. So I’m raising capital for the deals that we’re doing. And so we’re going to friends, family, extended associates and what have you. And we are sharing with them opportunities that we’re engaged in and inviting them to come along with us. And so in 2021, when I secured my first kind of multifamily large scale deal,

  you know, commercial real estate was in a fairly good place. And we were probably at the height of commercial real estate and multifamily specifically. And then you get to kind of March of 2022 and the Fed starts raising interest rates at an unprecedented rate. Over, you know, a very short period of time, we went from next to kind of flat to real low interest rates to, you know, we’re above 5 % all of a sudden, it seemed.

  And so that has been somewhat of a dark cloud over commercial real estate. And it’s been a real struggle the last, I would say two to three years as we’ve seen values have come down, interest rates have gone up, which has made it more challenging in terms of cashflow and the ability to recapitalize your deals, sell your deals. And so you’ve had to, I’ve had to, like many of my peers have had to be resilient.

  And you find yourself in a position where you’re second guessing you know my time in. Did I get in at the wrong time? And you know when are we going to emerge from this downturn, which is inevitable? Real estate is a cyclical thing. And so You know I think you’ve got to be resilient. I know a lot of people who got into the business at the same time as me. And

  have moved on to something else, you know, a year or two ago. And, you know, the numbers of us that are still, you know, plugging away with our sleeves rolled up has thinned substantially. And so, you know, not everyone was committed to kind of grinding it out and not everyone could survive without that W-2 or that consistent income or cashflow. And I think it’s

  those of us who are resilient that are still here.

  Kristen (12:42)
  Amazing, yes, I totally agree with you. And then where do you kind of see the market going from here? What’s your look at the market?

  Clive Davis (12:49)
  Yeah, I am very much optimistic about where the market’s going to be as we get ready to turn into 2026. I think we’re going to start to see, I’ve been talking to brokers who are already speaking about kind of an upsurge or an uptick in what they’re seeing in terms of deal activity and deal flow. I think those are early signals that you know we’re going to start to see the market come back. We’re going to start to see some value recovery.

  And all of those things are good. I know next week the Fed is meeting and so we’ll see whether or not they lower interest rates then, whether they do or they don’t. I think we’re going to see some further interest rate reductions over the next 12 months. So again, all of those things are favorable for commercial estate generally and certainly multifamily, which is where my focus has been. So I’m looking to kind of ride the wave back up.

  in the cycle and I’m anticipating a strong commercial estate market over the next two to three years.

  Kristen (13:51)
  That’s amazing. And you’re also involved in ground up development as well. Is that right?

  Clive Davis (13:57)
  I am. Over the last three years, I’ve kind of branched into as somewhat of a supplement to my multifamily business or main business. And so I’m involved with a couple of developments, one of which is underway, a 142 unit multifamily in West Midtown, Atlanta. So we broke ground on that in December of 24 and we will most likely deliver

  and finalize that in late 26, early 27 potentially.

  Kristen (14:34)
  Amazing and when did you start getting into those kind of projects?

  Clive Davis (15:19)
  So it was about three years ago, when you’re in multifamily, it’s kind of a natural next step for you to say, I don’t just want to buy existing properties, but I want to be involved with the development of these. And so I had a couple opportunities to connect up with folks who were in that space and two projects that caught my interest and attention and kind of the vision and kind of

  you know, what they had in development, I had an opportunity to get involved. And so it’s good to see those come into fruition on different timelines, but come into fruition nonetheless.

  Kristen (16:02)
  Yeah, it seems like you have a really good balance of education and then actually doing. It seems like you’re definitely a doer. I think people kind of struggle with those two things. Maybe they dive into something before they know all the information or maybe they just consume the information to death and never do it. What, can you just talk more about that and kind of your mentality around that?

  Clive Davis (16:23)
  Yeah, so lack of action through paralysis. So I mentor a few people and I talk about the importance of doing. so people, it’s not because of lack of knowledge or lack of information that people are not successful in this space. It’s because of their inability for whatever reason to actually take definitive action. And so

  you can, my youngest child just got his learner’s permit. And so I’m like, okay, that’s the theoretical. That’s only going to get you so far. At some point, you’ve got to get in the car behind the wheel and you’ve got to put it in drive and head out on a destination. And so a lot of people get immersed in the theoretical. You know, they listen to the podcast, you know, they read the books, they go to the conferences, but they fall short of

  actually taking the step. you know, I’ve just been a big believer that talk is nice, but action is really what you value or should be value in. And so when I took that leap of faith, you know, nine years ago, I felt that I had kind of deferred action long enough.

  And so the next step that I took had to be, you know, it just be theoretical and fall short of actually doing something and taking those steps. So the two are critically important.

  Kristen (17:53)
  Absolutely, I mean, it’s awesome that you have that mentorship experience and you’ve seen people kind of grapple with this on a personal level. Can you talk about maybe something you wish you learned in your career earlier that you could share with us today?

  Clive Davis (18:06)
  Yeah, so I learned earlier and again, looking in hindsight, I realized that one, I didn’t need to spend 20 years in corporate America before I took the leap that I eventually took. And as I talk to my children or people younger, I say, and I’ve gone back to my alma mater and I’ve spoken to undergrads about kind of career paths and things of that nature. And the one thing that I say is,

  Once you figure out what your passion is, what your interest is, you need to figure out how can I get on the path to that destination in the shortest amount of time. And so you don’t need to take a five, 10, 15 year detour doing things that are unrelated to what you’re passionate about or interested in to get back to that. And so I encourage folks to get on that path as soon as possible.

  And there are many things that can take you in different directions, but you’ve always got to keep that center in on this is what I want to do, this is what I’m going to do. And, you know, that’s going to pull you back onto that path whenever you kind of get distracted.

  Kristen (19:19)
  Absolutely, I think that’s really good advice. think a lot of people have their full-time careers and always kind of want to dabble in it. Was there ever overlap for you? Were you doing it kind of part-time before you jumped full into it?

  Clive Davis (19:30)
  So throughout those 20 years in corporate America, I was always a landlord. But I what I say is that it was more of a hobby. One, I was never reliant on the rental income. So my very first real estate investment, I think I made a couple years into my corporate career.

  life. So was a lawyer in New York City. I bought her a duplex down in Florida because my parents had retired down there. And I said, wouldn’t it be nice for me to pick up a duplex? I opened up a checking account. I put my parents’ names on it. I had the rents going into that account. And that was my way of subsidizing them in retirement.

  but again, I was never real, you know, if the rent was missed by one of the tenants, I wasn’t going to be in trouble of how am I going to pay my mortgage or my bills or what have you. So it was a nice place to be, but I wasn’t as disciplined about real estate as I am now. So now I don’t make any investment without thinking what’s our point of entry and what’s our exit plan. And.

  You you think about that in a very focused way, whereas that duplex, I had no idea how long I was going to hold it, what criteria would determine when I sell it. None of that. Again, it was what I considered to be more hobby-like. But again, throughout those 20 years of being a corporate employee, I was always a real estate. So I was always a landlord. So real estate wasn’t too far away from me. ⁓ And it was just a matter of

  Kristen (20:58)
  Yeah.

  Clive Davis (21:01)
  Okay, how do I flip the switch and become full-time real estate and kind of you know professional and commercial in focus?

  Kristen (21:11)
  Absolutely, well I think a lot of people probably relate to that. I think a lot of people are in exactly that boat. So I think you’ve given some great inspiration to people and some really good practical advice to follow as well. Tell everyone where to find you and how to get involved with Park Royal Capital.

  Clive Davis (21:24)
  Yeah, so I’m on social media. can find me Instagram, Facebook, LinkedIn. But the best way to get a hold of me is to go to our website. So parkroyalcapital.com. If you go there, you can connect with me. You can set up a call. I love talking to people. I can talk real estate all day. And you can also connect with me via my socials, Instagram and LinkedIn and others.

  Kristen (21:49)
  Amazing, well thank you so much for being here Clive.

  Clive Davis (21:52)
  Thanks, Kristen. This was great. I appreciate you having me.

  Kristen (21:55)
  Thank you everyone for listening. I hope you got some really good inspiration for your own business and a lot of great takeaways. Definitely reach out to Clive. Definitely check out Park Royal Capital and we will see you back next time. Bye.