How AI Helped Underwrite Over $1 Billion in Real Estate Deals in One Week

Spencer Thomas (00:00)
It’s going to be speed. Gone are the days that you can take weeks to decide if you want to move forward on a deal. A lot of operators like myself are using AI, and we have teams in place where you can submit an address to me and I’ll know within five minutes if I want to make an offer. I can even have an LOI drafted according to my template that I follow and get it submitted and get it locked down very quickly. So speed is going to be key for anybody in this industry.

The right speed, right? Going fast and hard is not always the best method.

Scott Bursey (02:01)
Welcome back to the Real Estate Pros podcast powered by Investor Fuel. I’m your host, Scott Bursey. And today we’re sitting down with Spencer Thomas, the founder of Thomas Capital Holdings. Spencer is a master at navigating the off-market space, specializing in direct-to-consumer cash home buying operations and finding quick, decisive solutions for sellers in distress. Pros, you can expect an incredibly tactical conversation today on how to streamline your acquisitions and truly serve your sellers in any market condition. Spencer, welcome to the show.

Spencer Thomas (02:41)
Thank you for having me.

Scott Bursey (02:42)
It is awesome to have you here and to help our listeners get up to speed. Please give us the ninety-second highlight reel of how your career ignited and where you’re pouring your fuel now.

Spencer Thomas (02:54)
Sure. I like to start off with when I joined the Army. I was still in high school. I did the split ops program. So after my junior year of high school, I went to basic training, came back to my senior year while also still in the reserves. Then I did my MOS training, gave me the discipline and the growth to start off as the real estate professional that I am now. And then served a mission in the Philippines for a church for two years. After I got back home, I had a buddy who said, you know, hey, you want to work for a bank?

That’s how I got into finance. I think that’s how a lot of us get into it. But what I didn’t know is the mission is what really taught me about building relationships and building trust and sales. And so it got me that head start that I needed as well. So the military mission and then starting in finance was a perfect storm. And then I got my degree in business management, and then I have a master’s in business analytics. Did a year of law school, but didn’t like the gray area. My brain is more a black-and-white kind of style.

So I like numbers, I like data. So I worked my way up into the private banking space within a couple of years of starting at the financial institutions and enjoyed it, enjoyed working with ultra-high-net-worth clients. Then after that, I became a consultant to financial institutions for a few years. While doing that, helped build a few real-estate-related companies, building out their inside sales teams, their lending divisions, their real estate divisions, while amassing my own portfolio of real estate at the same time and building Thomas Capital Holdings.

Scott Bursey (04:17)
That’s an incredible journey, Spencer. It’s always inspiring to hear how focus and grit turn into real momentum. And you know, what really caught my attention about you was the way you’ve been able to dominate the off-market space while maintaining such a streamlined, seller-focused operation. That’s not easy. And on that note, curious to know regarding your strengths in this business.

What specific internal processes have allowed you to scale your direct-to-consumer acquisitions so efficiently?

Spencer Thomas (05:40)
Sure, outside of my network, right, that I’ve been amassing for the past 20 years, what has helped tremendously has been AI, right? And I tried all the models, and what works the best for me and the data analysis is Claude, not the cheap version, but the expensive one. It has the ability to remember memory, right? It has that memory built into it, so it remembers our conversations. So I’ve been training it for about six months now.

And I’ve underwrote over a billion dollars in one week using it.

Scott Bursey (06:13)
Wow. Following up on that, Spencer, how do you keep your team aligned when shifting strategies for distressed properties?

Spencer Thomas (06:23)
Sure, it’s weekly or daily conversations about what we’re doing, where we’re going, how can we improve? Working on the company rather than in the company is important. It’s easy to get in the weeds and just focus on the individual deals and let your phone blow up all day. Now my phone doesn’t even ring if the number’s not saved. I just had to do that. And so anyone that needs to reach me, they have to text me first. Or I just can’t answer.

Scott Bursey (06:47)
We’re interested to learn in terms of weaknesses or common friction points you faced. What has been the biggest hurdle in maintaining a high volume of off-market leads?

Spencer Thomas (07:00)
Biggest hurdle is just keeping it all organized. And so you’ll have people reach out to you through a variety of channels, Facebook, text message, email. And so putting systems in place to monitor each of those and to track and follow up has been crucial.

Scott Bursey (07:15)
And digging deeper, what’s your primary strategy for turning those friction points into opportunities for growth?

Spencer Thomas (07:23)
Establishing processes, right, automations. Now I have an AI built into my email that automatically scrubs deals that are emailed to me. And if it’s the box that I’m looking for, I get another email that tells me a folder has been created for me to review.

Scott Bursey (07:37)
I was wondering, what do you see as the vision for Thomas Capital Holdings in the next twelve to twenty-four months? And then maybe describe the larger picture as well, Spencer.

Spencer Thomas (07:49)
Sure, so the next 12 to 24 months, the focus is to be more on the transactional side of real estate and even operating businesses. Over the connections I formed over the years, I now have business owners that are reaching out to help expand their operations and acquire additional locations. And so it’s really being that person, subject matter expert that people can go to to run the numbers, look at the opportunity holistically, and determine what’s the potential paths forward. And so sometimes I’m brought in to do the capital stack, sometimes I’m brought in to help organize the financials. Sometimes I’m brought in as a co-owner to help raise the capital and push it forward.

Scott Bursey (08:26)
And on that note, where do you see the biggest shift, let’s say, in the cash home buying market over the next year?

Spencer Thomas (08:35)
It’s going to be speed. Gone are the days that you can take weeks to decide if you want to move forward on a deal. A lot of operators like myself are using AI, and we have teams in place where you can submit an address to me and I’ll know within five minutes if I want to make an offer. I can even have an LOI drafted according to my template that I follow and get it submitted and get it locked down very quickly. So speed is going to be key for anybody in this industry.

The right speed, right? Going fast and hard is not always the best method.

So having the systems, the tools, the process in place to make sure that when you are making an offer on an opportunity that it’s not going to come back and bite you and you’re not wasting your time on something that you shouldn’t make an offer on.

Scott Bursey (09:16)
With that shift in mind, what is the first move you’d be looking to make to capitalize on speed, but keeping in mind moderate speed?

Spencer Thomas (09:25)
Automations, right? It’s streamlining the process. So one of the companies that I’m a co-owner of, we have sellers that are submitting their opportunities to us through our portal. And we’ve trained the AI to automatically negotiate with them. It’ll underwrite it and then negotiate it at three different tiers before we’ll get it under an LOI submitted.

Scott Bursey (09:44)
And intrigued to know, Spencer, looking at threats, how are you mitigating the risks associated with the current economic landscape for distressed properties?

Spencer Thomas (10:28)
The biggest risk, and always has been and always will be, is essentially fraud, right? You have a lot of people trying to say that they have a bunch of capital they want to put to play and some sort of crazy trust thing structure. There was one just last week that I had to burst some guy’s bubble. He thought he had this, you know, end buyer that was going to fund all of his deals. But then it comes down to the sellers. A lot of sellers inflate the numbers. They’ll put together P&Ls or T-12s where they’ll underestimate or just underreport the actual expenses. So it’s a lot of trust, but verify—not intentional fraud, I would say. But I had one the other day that was submitted to me where they left out property taxes, and like, all right, I think that was just an accident, but it made his cap rate look a lot better than what it really was. And therefore his purchase price was inflated—so, for-sale price. So that’s the biggest thing in today’s market, especially with AI and how official documents can look now and how well presented they can be.

Now back in the day, you know, people who were good at Adobe could, you know, try to fudge the numbers. And I had one guy change the numbers on a bank statement where he sent a bank statement from like two years prior and then tried to change the year on the bank statement and submit it to us. This was on the lending side. So it was easily caught, but now your AI can create a lot of things. And that’s where, as a buyer or an operator, you really have to double-check all the numbers yourself.

Scott Bursey (11:51)
And just to follow up on that, how do you communicate these fraud risks to your team without stalling their momentum?

Spencer Thomas (12:00)
Sure, again, it’s back to the systems that are put in place. So the AI that I’ve been training does a lot of the underwriting, but it’s always important that I, myself, or somebody with my level of expertise reviews them and ensures that, you know, getting an LOI signed is fine. It’s, right, there’s no risk if we have to kill it. But before we get to the PSA, right, that’s important that there’s a human touch point. So establishing systems, processes, you know, the automation is crucial to scale.

But you can’t leave out the human touch points and making sure somebody with the right expertise and background is double-checking.

Scott Bursey (12:31)
And Spencer, if somebody’s listening and they’re saying, hey, this is somebody that I really like, may want to do some business with down the road, what would you like them to know first about Thomas Capital Holdings?

Spencer Thomas (12:43)
Sure, the first thing to know is I spend most of my days saying no, right? A lot of people come up to me, they have great ideas, they have great intent. Unfortunately, you know, ideas are a dime a dozen, as this expression goes. So if you have a real opportunity, you have a business that has earnings, or you have capital that you want to invest, I’m happy to jump on a call and talk it through. And to know about what we can provide, it’s really case by case. You know, with my background in finance and real estate, there’s a lot of value I can add.

It just depends on what are the needs of the person and their business.

Scott Bursey (13:16)
Are you a part of any networking groups, peer groups, anything of that nature?

Spencer Thomas (13:21)
Yes, I belong to a few groups. One in particular that’s my favorite is the CliffCo group. It’s a group of entrepreneurs and politicians and business owners over the years that we’ve amassed. I’ve been in the group now for four years, was referred by a friend of mine. It’s invite-only, and they screen everyone coming in, and you have to have a business that doesn’t conflict with another business in the group. And we meet once a quarter at the Porsche Center in Atlanta.

Scott Bursey (13:47)
Spencer, if you had to start your acquisition firm over from scratch today with zero capital, what is the one activity you would focus on to secure your first deal in like the next thirty days?

Spencer Thomas (14:03)
Yeah, that’s a good question. So knowing what I know now, the first thing I would do is I would work for a family office or an M&A firm and learn from them what they’re doing, what they’re looking for, and help fill their needs. Forming those relationships has been the best investment of my time and energy over the years because they care more about the people they work with more so than the deals. They understand that the deals will come and go. There’s risks. They may lose money. They may make money. They want to, but more importantly, they want to work with people they know and trust and understand what they’re looking for.

Scott Bursey (14:34)
People do business with folks that they know, they like, and they trust. That is an excellent, excellent trifecta there. Thank you for explaining that. And you’ve really illustrated a lot of great advice for our pros here today, but is there any words of wisdom that you can leave with our listeners?

Spencer Thomas (15:35)
Yes, the biggest thing outside of my connections and my knowledge and experience that’s helped is my desire to solve problems. Right. And so if you have that innate desire to solve problems and you want to help people and you want to make a difference, if you don’t have it, you should get it. But that desire to solve problems, to help people when they’ve come to me, has really paid off in spades over the years.

Scott Bursey (15:58)
Spencer, for those of our listeners that want to keep this conversation moving, you know, stay in your lane or collaborate with you on perhaps future deals, what is the best way for them to plug into your pipeline and reach you directly?

Spencer Thomas (16:12)
LinkedIn is a great way. I’m very active on LinkedIn. You can find me, search Spencer Thomas, CWS. I’m a Certified Wealth Strategist as well. And so that’s a great way. Facebook is fine. I’ve maxed out all the friends I can have on Facebook, though. I don’t know why they cap you at the 5,000. Or they can email me, which I’m happy to provide the email as well.

Scott Bursey (16:33)
Spencer, thank you for joining us here today. It’s been an absolute pleasure. And to our listeners, we appreciate you. If you receive value from today’s episode, please subscribe. We’ll be filling your tanks with the lineup of elite guests, just like Spencer Thomas, who are accelerating and setting the pace for the rest of the industry. Until next time, keep your standards high and your vision clear. We’ll see you on the next episode, everyone.

Spencer Thomas (16:37)
Thank you for having