Joel Block on Real Estate Investing, Syndication Strategy, and Becoming an Advantage Player

Joel (00:00)
And it’s the people who can beat those unbeatable games. And I was always referred to as an advantage player. That’s what the casinos called me. I was an advantage player because I could beat them. And you know, and in life you want to be an advantage player and there just aren’t all that many of them around. They’re just aren’t. So think, see and act. Advantage players, you know, think differently than other people. They see and notice what others don’t and they take actions that others won’t.

Scott Bursey (01:55)
Welcome back to the Real Estate Pros podcast powered by Investor Fuel. I’m your host Scott Bursey And today we’re lighting up the airwaves with a guest who is pure intellectual octane. We’re talking about a master strategist, a high stakes negotiator, and the genius behind the Advantage Player Institute, Mr. Joel Block. Joel doesn’t just play the game.

He changes the rules by finding the hidden advantage in every deal. If you’re ready to stop guessing and start calculating your success, this episode is the fuel you need to level up your investing game. Joel, welcome to the show.

Joel (02:31)
Scott, thanks for having me, man. Nice to see you.

Scott Bursey (02:33)
We are so pumped to have you and for those of our listeners who may not be familiar with your journey, please tell us how did your career begin and what is your main focus now?

Joel (02:42)
You know, I had an unusual journey. I’ve been in many, many different things. I’ve always been in the money raising business. And so I’ve been in the deal business and the deal business has taken me into many different places. But when I was in college, I had a very unusual experience. I was invited to play blackjack, professional blackjack. I wanted the most elite teams ever to play in Las Vegas. And that really was kind of the start of my career.

⁓ for a couple years. I mean, you can’t do that for a long time, but that’s, that was an amazing ⁓ journey that few people can even imagine.

Scott Bursey (03:16)
Well, absolutely. And that is just fascinating. Could you take us a step or two further?

Joel (03:22)
Sure, know, I sometime like in, I don’t know, I was about 20 years old. I wasn’t even 21. I bought a book on how to play blackjack. was starting to become available to consumers and the word was getting out that people could beat the game.

And so all these people started writing books and buying books and there were courses and seminars. And so I read this book and I started practicing how to do this. And my dad calls me and he says, Hey, there’s this blackjack seminar in town. Do you want to go? said, yeah, I’d like to go. We go to the seminar. The guy does the program, you know, and whatever he does. And at the end, I go up to the guy and it’s very important. You know, you want to go up to the speaker when you’re, you know, you want to put it out there, you know, so I go up to the.

speaker and I say to the guy saying you know that was just a really great seminar that you did he goes well are you buying the course I said no I’m not buying the course he says why not it was such a great seminar why aren’t you buying the course I said well because I already have count cards he goes really you do I said yeah yeah I do

And he says, if I took a pack of cards and I took one card off the top, put it on the table face down, how fast could you look at those 51 cards and tell me what card is on the table? I said, I could do that. And this is not a magic trick, by the way. I said, I could do that in 18 seconds. He goes, wow, that is really good for a beginner.

And I’m like, for a beginner, what are you talking about? Are you kidding me? How fast can you do it? He said, I can do that in seven seconds. And he says, you know, he says, I’m sort of kidding. He goes, I’ve never met anybody self-taught who could do it that fast. And he said, forget about buying my course. I want you to come over my house. I’m gonna teach you how to play blackjack. And we became friends.

He said, and the truth is that he scouted me out of the audience. He wasn’t inviting me to his house to be friends. He invited me to his house because I knew I had the potential to be a great player. I went to his house, spent four or five hours every single day after school. I was at UCLA at the time. And after three months, I had become one of the fastest card counters in the world.

and they invited me onto this team was a team owned by a gambler out in New Jersey, a famous guy. And I went to Vegas every single weekend and took money out of the casinos and that was kind of how my career started. And now it’s kind of the metaphor for everything that I do in business because professional card players tend to know a little bit about what cards come in next.

And that’s a skill you need to have in your business. What card is coming next in your life, in your business? You you need to be able look forward. The strategies of what happened at the Blackjack table are so parallel to what happens in real life. I just lean on that. Audiences love the metaphor. You know, it just works.

Scott Bursey (06:47)
It all boils down to paying attention. Being prepared.

Joel (06:50)
Well,

yeah, well, you know what? We have a little motto here. It’s called TSA, just like at the airport, that what separates advantage players, and advantage players are the people, it’s a phrase from Las Vegas.

And it’s the people who can beat those unbeatable games. And I was always referred to as an advantage player. That’s what the casinos called me. I was an advantage player because I could beat them. And you know, and in life you want to be an advantage player and there just aren’t all that many of them around. They’re just aren’t. So think, see and act. Advantage players, you know, think differently than other people. They see and notice what others don’t and they take actions that others won’t.

And whether you’re in real estate or you’re in anything else,

If you can see things that other people don’t see and then you’re prepared to take action that other people are afraid to take, won’t take, can’t take, whatever the deal is, you’re on the track to be an advantage player.

Scott Bursey (07:40)
Absolutely. Let’s talk about the math aspect of things here, Joel. How much does the math play a role into, let’s parlay it into real estate.

Joel (07:49)
Yeah, you know, believe it or not, I’m a mathematical person. I became a CPA. I was licensed for many, many years, although I really didn’t practice. Accounting didn’t really work out for me. I worked at Pricewaterhouse after I graduated college.

And the last account I was assigned to was a giant real estate syndicator. And of course, I didn’t know what a syndicator was, but I’m assigned to this giant syndicator. And my job with an army of other guys was to convert the books and records of 500 partnerships into tax returns. That was our job. And I hated doing the tax work, but I loved reading the partnership agreements. I just loved it. And so…

You know what I did was you know I quit the firm and started my own little syndication for me. Yes about the math. One of the things about me is that my math skills because they’re very good. You know this is just how I think I boil everything down to rules of thumb. You know I could price a building on a rule of thumb within 1000 bucks. Now you may able to get closer but it’ll take you an hour. I can do it in 5 seconds.

And in five seconds, know, getting within a thousand bucks is good enough. I can price things. I can estimate cost. I can estimate returns. And, you know, to me, I think rules of thumb are the name of the game. So to me, it’s not about math at all. I’ve taken all the math out of it by figuring out little rules of thumb, which if you ask me what they are, I can’t even tell you, because I don’t even know. They just come to me as I, you know, but.

You know, if I was in a situation, there’s a little rule of thumb somewhere that I’ve kind of figured out. And I use that, you know, I use rules of thumb for everything.

Scott Bursey (09:27)
It sounds like instincts plays a huge, huge part of this.

Joel (10:06)
Well, I call it intuition, not instinct. And I am a very intuitive person. You know, I was talking to the CEO of a public company yesterday, one of my clients, and I said, I said, I’ve got a pretty good sense about what the problem is, because I’m very intuitive. said, but I don’t want to blurt it out, because I don’t have all the facts. Now, my guess is that the facts are going to end up supporting my intuition.

But there is a little bit of problem with having some intuition. And you know, I love the opinion that all people are smart. All people have intuition. All people have these skills. The point though, is that we’re all smart in what we like. You know?

I always thought that the most extraordinary example of this, Mike Tyson, one of the greatest boxers of all time, I love Mike Tyson, but he could barely put two sentences together. mean, he literally maybe was shy, I don’t know what it was, and everybody thought he was stupid. Everybody thought that. But the guy’s one of the greatest boxing historians that ever lived. He knew more about boxing, the numbers, the stats, the people, the profiles, than anybody on the planet.

Now, you don’t get that way by being unintelligent or stupid or silly or anything else. The guy is highly intelligent. He just wasn’t interested in a lot of different things and that’s how it works. So if you’re fascinated by real estate and you wanna understand real estate and you’re willing to put the effort in, you could be great at real estate. If you’re just trying to do it because you just don’t have any other way of making money, I think you’re gonna struggle.

Scott Bursey (11:34)
Absolutely, there’s so much logic in that. So let’s dive into this question that I know a lot of our listeners are going to want to hear from you. What core tactical strength should every real estate investor be developing right now to maintain their edge in the shifting market?

Joel (11:51)
You know, that’s a wonderful question, by the way, because it’s predictive. It’s looking forward. You have to always batch tactical skills with strategic thinking. You have to put those things together because if you just start doing stuff, you’re going to waste a lot of energy. So that probably is number one is what’s going on in the world that’s going to make a difference. Here’s the other thing is.

You gotta be ready. Real estate is a business about being ready. And if you’re not ready, don’t even bother. In other words, if you need a bunch of money to go buy something and you don’t have the money, don’t even bother. I’ll tell you why. Because you’re just gonna embarrass yourself, you’re gonna embarrass other people, and you’re gonna piss people off, and it’s just not gonna work out.

Whatever you need to organize in advance, you have to be organized in advance. You just have to be. You can’t show up at the table and be under informed, under educated, under staffed, under resourced, whatever that means. You have to be ready. And if you’re putting together a structure, you have to have your structure ready in advance. And that may seem unfair. Well, we don’t have the money to put together.

Syndicators are resourceful people and they will figure it out and you have to go get some resources to make it happen.

Scott Bursey (13:06)
Absolutely. That was so well said. And what sort of opportunities are you seeing right now that you’re ready to capitalize on?

Joel (13:14)
Well, I’ll tell you that, you know, we’re in the middle of a war. You know, it’s not a full blown war, you know, it’s rather one sided, but you know, we’re in the middle of this offensive. And this sort of thing paralyzes people. And when people are paralyzed with fear,

You know, whatever the reason is, they don’t know what’s going to happen with oil prices, don’t know what’s going happen with inflation, they don’t know what’s going happen with interest rates. When people are paralyzed with these kinds of concerns, it gives an opportunity to people who are light on their feet and are ready to go. You may not get it exactly perfect, you may not hit the absolute bottom of the market, but I’ll tell you what, the opportunity for things right this minute is awesome, if you’re ready.

If you’re ready, you know, I mean, if you’re, you’re not ready, uh, then you’re going to probably miss the opportunity. And that’s how it is. So you need to be ready. Uh, you know, uh, having bullets doesn’t do any good if you don’t have a gun. It’s, know, and you have to make sure, uh, if you have a gun, doesn’t do any good if you don’t have any bullets, you know, so you got to make sure that you’re ready. Um, the only difference is that if you have a gun, you can scare people.

But then you end up being an empty suit and people know in the future that you’re a fake, a fake dude, you know? So, you know, you just, gotta be ready. And if you’re ready, you can take down some really, really good stuff. There’s a lot of paralysis in the market right now. And that opens the door in a really significant way.

Scott Bursey (14:35)
Absolutely, and Mike Tyson was laid on his feet and look where he rose. Excellent.

Joel (14:40)
I just, I love that guy. mean, it really bothered me that he was taken advantage of by a couple of women and, you know, whatever happened to him. But he was one of the most extraordinary athletes of our time.

Scott Bursey (15:34)
Absolutely. And Joel, where do you see most high net worth real estate investors consistently underestimating their operational weaknesses right now in your view?

Joel (15:44)
Where to? Well, a lot of high net worth people. Sometimes they manage themselves very often. You know the huge, probably huge number of people invest through funds and other structures because these people are busy there. They’re They’re spread out there diversified across many asset classes.

And you know, people in real estate tend to see other people in real estate, there’s kind of an echo chamber. But if you take a step back, there are a lot of wealthy people who don’t spend time in real estate but have exposure to real estate, and they get that exposure through funds. I mean, you can’t walk down the street or drive on a freeway without seeing buildings and things that are controlled by funds and groups of people. Because nobody has the money by themselves, it’s rare. Nobody has all the money that

need even even Elon Musk doesn’t have as much as he needs he’s always borrowing and restructuring or reorganizing but for more regular people

You know, they need to cooperate with others. That’s the capital system that we have. And you gotta put your money with other people. And so really it’s about managing your organization and having the right people doing the right job. Very often a lot of these people, they made a lot of money, but they didn’t make it necessarily by being the entrepreneur. Maybe they made it because they were an engineer or scientist and they got a lot of stock from a company. So now they have a lot of money.

but they didn’t per se earn the money themselves. They were part of a team that did it. So they may not know all the moving parts that happened and they then oftentimes will end up investing passively into a fund structure or syndication structure or some other kind of a deal. And when you have those kind of people that put the bullets in your gun and then you share the profits with those people, everybody wins.

Scott Bursey (17:27)
Absolutely. You bet.

Joel (17:27)
But let me just say one

other thing. There’s sort of something taken for granted in that process. And that is that you the promoter, if you’re the person in charge of the group, the quarterback, you have to be good at what you do. And if people start throwing money at you because you’re a big talker and you tell them all the stuff you’re gonna do, if you can’t perform, if you can’t find deals, if you can’t run deals, if you can’t negotiate deals,

all the money in the world isn’t gonna work out for you.

Scott Bursey (17:55)
I love that framing Joel. Which overlooked or emerging sector represents the single biggest advantage play for investors this year in your view?

Joel (18:05)
You know, that is really a kind of a trick question because what’s good for me may not be good for you. If I know if I know ⁓ institutional property.

and there’s a shopping center that comes online and I’m not set up to manage shopping centers, to broker leases into shopping centers because that’s not my network. The best deal in the world is not necessarily the best deal in my hands. So you really have to qualify that question that the best deal in the world may not be the best one for me. And that is really hard for people to understand.

You need to get specialized into something. Your investors are going to want to know that you’re really good at something and that you’ve got a network that you can call on to solve problems in something. It doesn’t matter what it is. It can be storage. I think storage is a great market. It could be a multifamily. Multifamily is never going away. You know, it could be industrial because industrial doesn’t require a lot of manpower. But whatever it is for you, that’s the answer.

Scott Bursey (19:02)
Joel, in the spirit of being an advantage player, what is the one hidden trap in a standard deal structure that rookie investors consistently fall into?

Joel (19:12)
Yeah, well, let’s talk about the syndication structure, not just a real estate contract. Let’s talk about the syndication of the fund structure, which is kind of the Wall Street side of this business. The Wall Street side is that you bring the money together and then you go buy something. Everybody together buys something and the syndicator, the promoter, the issuer, the guy, the quarterback who runs the deal and puts it all together.

gets an extra share for the work that he or she does for putting the thing together. Most syndicators and fund managers leave a great amount of money on the table because they don’t structure their fees correctly. And you know why that happens? It happens because they get their advice from attorneys. You gotta have an attorney. An attorney has to run the deal. They gotta put the paperwork together. But attorneys do paperwork. They don’t do deals.

They say they do deals, they think they do deals. But it’s a rare attorney who’s ever been in the field negotiating and putting the gloves on and duking it out knowing exactly what happens. Business people do that. Other syndicators do that. And then you go to the attorney for protection and risk mitigation. But when you get risk mitigation, you don’t get profit maximization. You don’t get, you get one or the other.

and your attorney is going to give you risk mitigation. And for that reason, many people end up leaving a lot of money on the table. They don’t structure their fees correctly, partly because they’re afraid that the investors are going to be mad at them for taking fees. But here’s the thing. In a real estate transaction, some broker is going to get paid. Might as well be the syndicator.

some broker is gonna get paid for the loan, might as well be the syndicator. And what the investors know is that if you don’t keep the lights on, the deal goes down the drain and everybody loses. So they’re really better off to give you something than to let the deal go down the drain. And that’s really the truth. Now, if a syndicator, and I’ve seen this happen many times, buys a

a really poor deal just so they can get a commission, that’s destined for failure. That person is not in this business for the long run and it happens every day. And so there’s just a lot of issues around pricing, around fee structures, you know, and so forth. And that’s really the downfall of a lot of people.

Scott Bursey (21:22)
go. Joel you’ve dropped some serious wisdom but now it’s time for the money question. When facing an experienced tough negotiator across the table, a true shark if you will, what is the one illogical technique you use to flip the power dynamic and secure the advantage?

Joel (21:39)
You know, so that would be, you know, I love the two sharks, but you know, what does one advantage player do to another advantage player? That’s really how I think about this. They flip the script and here’s the way that they do that. I’m not buying your deal, you know, or you’re not selling me something. You’re lucky to get me to buy it. And it really, you’re reversing that you’re turning the tables that instead of them selling,

they’re convincing you to buy and they’re gonna be lucky if you buy and that really is the name of the game because you bring a lot of whatever to the table and that’s really the main thing that you have to convey. It’s not, it’s, when you’re negotiating, you have to get them to hook you, not the other way around.

Scott Bursey (22:22)
That is fantastic, game-changing advice, Joel. Thank you. And before we sign off, I always want to make sure that our pros can connect with the guests who bring the fuel. What’s the best way for our listeners to connect with you?

Joel (22:34)
Sure.

You know they can go to my website which is TheAdvantagePlayer.com

or they can email me at [email protected] It’s not a real estate website anymore. know, I am very well known as somebody, we’ve built hundreds of funds, we’ve helped thousands of people learn about the fund business. Funds and syndications are similar, but funds are really much more powerful. So it’s a really fantastic structure. That information is not on that website. This is really about making high performing people, turning them into advantage players.

athletes of business. That’s what you’ll see on that website but it’s the same one and feel free to reach out if I can help.

Scott Bursey (23:13)
Thank you for that and what golden nugget or some words of advice would you like to leave with our listeners here today?

Joel (23:21)
You know, would tell people that, you know, people always say it’s so hard to get a job or whatever the problem is. you know, yeah, it’s hard to get a job if you’re average. But if you’re a high performer, if you’re an advantage player, the world will never ever have enough advantage players. So strive to be an advantage player because that will put you in the kind of demand that you’ve never been in before.

Scott Bursey (23:44)
Joel, thank you for joining us today.

Joel (23:47)
Well Scott thank you for having me.

Scott Bursey (23:48)
This has been an absolute masterclass. And to our listeners, we appreciate each and every one of you. If you got value from today’s episode, please subscribe. We’ve got a lineup of exceptional guests, just like Joel, who are making huge moves in not only the market, but the world. Until next time, keep your standards high and your vision clear. We’ll see you in the next episode, everyone.