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Show Summary
In this conversation, Dan Haberkost shares his journey in the real estate and land market, discussing the unique challenges and opportunities within the industry. He emphasizes the importance of understanding the land market, the skills developed through experience, and the significance of building strong relationships in business. Dan also reflects on market shifts, lessons learned, and his goals for future projects, providing valuable insights for anyone interested in real estate investment.
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Investor Fuel Show Transcript:
Dan Haberkost (00:00)
so in 2022, it was almost exactly four years ago. So right at the beginning of 22, the main market, I was doing business in Pueblo West Colorado, decided to shut down all new water taps with absolutely no warning of any kind. And they didn’t give a lot of information. So almost all of my business was there. had quite a few properties in escrow to buy, to sell, planned builds for the year, et cetera.And I don’t know, is the land worthless? Are they out of water? You know, what’s going to be the scenario here? And then obviously that whole pipeline just shut down.
Quentin Edmonds (02:05)
Hello, everyone. Welcome to the Real Estate Pros podcast. I am your host, Q Edmonds, and I am excited to be here today. I’m excited because my guest is, we’re going to talk about land today. And I’m sure he’s going to let you know it’s something that’s kind of underappreciated. I’ve talked to some land developers, but I don’t get to talk to a lot of people that deal with within land. And so I’m very excited.to have this conversation and introduce you all to Mr. Dan Haberkost. Mr. Haberkost, how did I do with that last thing? Did I do okay?
Dan Haberkost (02:41)
Perfect, spot on.Quentin Edmonds (02:42)
My man, I appreciateyou, sir. Listen, Mr. Dan, thank you for being here. What I want to do, I kind of want to dive right in. I want you to tell the people what your main focus is these days. If you want to give them a little bit of an origin story of kind of how you got into, you know, what you’re in, the niche that you’re in. We love origin stories. And then also tell them what markets you’re operating in, what part of the world you’re in. So Mr. Dan, so you have the floor, man
Dan Haberkost (03:07)
Great. Yeah. Well, thanks for having me, Quinton. So quick background for your audience. I actually got started in real estate when I was 21. So I worked full-time through college and that wasn’t a whole lot of fun. and so, you know, working a full-time job, going to school full-time, I didn’t have much free time. However, I was managing people, managing numbers in a business, in a landscaping company for somebody else. And doing that, I learned a lot at a young age about business, finances, managing people.And so as I was finishing school, I thought, okay, well, how do I take this and start something when I no longer have the time commitment of school and build something of my own so I don’t have to work for somebody else? And so I read a bunch of different books on investing, business, et cetera. And like just about everyone else, was rich dad, poor dad. was the light bulb moment. So I went, I bought a duplex for a house hack when I was 21 and that was in Ohio where I grew up.
and didn’t want to stay there, moved to Colorado when I was 22 and I bought another house as a house hack, kept the duplex and quickly found that the low and no money down stuff is great maybe for a few properties but the reality is if you want to buy a lot of real estate you need money, you need money somewhere even if you get no money down deals or seller financing
things go wrong, right? Anyone that’s been doing this for a while, I can tell you all kinds of crazy stories about rental properties. Things go wrong. You need cash. You need liquidity to bridge the different problems that come about. And so I started going to a local real estate group. This was in 2018 when I moved to Colorado and I met a guy who’d been in the land and development space since the 70s. And he lived about an hour south of where I was living and he was doing new construction. So I would drive down there every weekend.
I’d help him in his business because he was a bit behind technologically. And uh he got me into land and then small scale development. So my first few land deals were just sourcing lots for him and his builder friends, direct to seller. They’re just simple infill lots. And I quickly started making money that way. I was participating with him on the builds, helping put them together. I’d make some money. I’d flip some lots to him and his friends. And that’s where Front Range Land was ultimately born. So I started that in 2019.
And that became the vehicle for making money to then buy more and more rentals. And land is great, but it doesn’t come with the appreciation. and so I make the money in front range land. put it into rental properties. Those depreciate nicely and then help to reduce the tax burden on that income. And so I left my last job in 2019. So I’ve been totally on my own since then. and uh yeah, front range land has evolved over the years, which all almost all direct to seller marketing.
Occasionally we get on market deals if they’re large enough and we solve all kinds of problems, title problems of all kinds to get deals and then also do subdivides, exempt or minor subdivides where you take large tracts of land, split them up, sell them off and so that’s the vehicle for making money and then slowly and steadily buying rental properties along the way.
Quentin Edmonds (07:01)
Love it, man. Thank you, man. Thank you for walking the student journey, letting us know where you are now. And I like it. You know I say this by once every episode because it just proves to be true when I talk to people just like yourself that destiny has no wasted moments. Right. So meaning like as you go through life, there are just things, skills that you acquire, mindsets that you acquire that just help you be who you are today. And so when I listen to you,And you’ve been doing this since 2020, I’m sorry, since 21 in college, working full time, going to school full time, not having a real personal life, right? You’ve walked away, been doing this full time since 2019. You know, in the landscape of business, you picked up just skills. I just want to pull out some of those skills and actually point blank. What are some strategies, personal strategies, personal skills that you have developed?
over the years, throughout your journey, that kind of make you the man you are today and the business person you are today.
Dan Haberkost (08:05)
Hmm, that’s a great question. I’d say one of the biggest things is along the whole way, there are just so many things you have to do and conversations you have to have that are really uncomfortable. And so my ability to handle, manage and not react to conflict and problems is pretty, pretty solid at this point. mean,I could tell you so many horror stories of things from water coming through the ceiling to contractors getting arrested in the midst of huge projects and bailing them out of jail and just endless crap, I can tell you. So that’s probably one. I’m very good at remaining stoic when everything’s going wrong. I can handle conflict very well because there’s just always problems and conflicts and you have to get it past it to close and solve deals. And probably just communication, which goes hand in hand with what I just said.
I feel like I’ve become pretty good at communicating clearly and concisely from business.
Quentin Edmonds (09:02)
Dan, no, that’s beautiful, man, because everybody don’t have that superpower. And I’ll tell you one person that don’t have that superpower is me. Like I have to actively work on not getting too emotional. you know, my wife, my wife even said early on when we got married, she says, you know, is a secondary emotion. Tell me what you really feeling. And so I’ll be like, ⁓ man, like, ⁓ man, the fact that you can remain stoic, the fact that you can remain.your amygdala can remain intact as you deal with things is brilliant because I that’s a skillset that is not learned from me, but I am learning it. I’m learning to slow myself down. And so, I thank you for answering that question. Thank you for the, what I say is to give to your vulnerability because you did not have to share that. And so many of us, we have different, you know, temperaments, different things that, drive us. And it’s good to know that you have learned how to just slow things down.
not be easily rattled, as you said, bestow it. And so I appreciate you sharing that. I just want to encourage everybody just to dig deep and just know their self. Like I don’t you know even though I’m not like you in that regard, I can learn to be. These are different things that I can pick up on. So I appreciate you sharing, Dan. Now, I loved how you said you faced some adversities. You talked about contractors getting arrested. So obviously, things have not always been easy as you was building.
I would love, if you could tell us a quick story about some time when you had to pivot real fast because of adversity that you’ve been facing.
Dan Haberkost (11:10)
Yeah,so in 2022, it was almost exactly four years ago. So right at the beginning of 22, the main market, I was doing business in Pueblo West Colorado, decided to shut down all new water taps with absolutely no warning of any kind. And they didn’t give a lot of information. So almost all of my business was there. had quite a few properties in escrow to buy, to sell, planned builds for the year, et cetera.
And I don’t know, is the land worthless? Are they out of water? You know, what’s going to be the scenario here? And then obviously that whole pipeline just shut down.
Nobody was going to buy or, or, well, people would sell, but nobody would buy anything until that was solved. And so that was a terrible day. I found this out when I was flying home from a vacation, actually, on, you know, when you land in a layover and you get service again, and when your phone blows up, you know, something’s wrong. so that’s what happened.
And I had to quickly figure out how to move to different markets. so at that time I started marketing to Florida immediately. And long story short,
About four months later, they did end up opening water taps back up. ended up being in a much higher price and a reduced allocation. So all was not lost, but ended up making far less on what I was working on. The land values went down and then it also coincided with right when interest rates were going up. then that slowed down the market. So that market’s been very slow since then. And I think the biggest lesson learned from that was just not having all your eggs in one basket, which like many lessons is something everybody says, but I think we’re all bad at learning things by proxy.
and we have to get kicked in the teeth to learn them. that was one. I can give you plenty more if you’d like.
Quentin Edmonds (12:46)
No, man, that was brilliant. And listen, I’m going to tell you, we are definitely created differently because you’re telling a story and I’m getting anxiety. You actually lived it. I’m over here like, wait a minute, what? And my mom, I’m like, what would I, ⁓ what would I have done? And so we’re definitely, you know, we definitely created differently. But I thank you, man. Thank you for sharing the story again, letting people know, you know, sometimes you’re going to come up against adversity and I love the way that you were able to stay calm within the adversity and just have that growth mindset.to find ways to get around things and get things accomplished. and so then let me ask you, What’s the next goal for front range land? What are you looking to solve at scale next?
Dan Haberkost (13:26)
Yeah, the biggest thing this year is we have goals around a certain amount of projects purchased. you know, it’s impossible to predict perfectly the Dispo timeline, how long it’ll take to sell. But if we’re buying at a certain basis, you know, low enough and it’s good land that fits our criteria, we’re not forcing anything. That to me is the biggest metric we can hit this year. So we have goals around that. You asked earlier and I forgot to answer. It just reminded me.We’re focused on Colorado obviously with front range land but then had it expanded to the Carolinas. I know I referenced Florida. We did a bunch of deals in Florida in 22, 23, and 24 but much of Florida has really slowed down. So heavily, heavily focused on large tracts of land in Colorado and the Carolinas.
⁓ and yeah, working to get, as an example, last July, bought 640 acres. We split that into 16, 40 acre lots. We’re selling those off one at a time. That’s been a great project. And I want to duplicate that over and over again. So we have goals around, buying a certain amount of projects like that while also, you know, keeping small deals going as well, just, know, kind of keep the lights on, but you can, you can make so much progress with one solid acquisition. it can set you up for years of profitable, you know,
of smaller pieces.
Quentin Edmonds (14:43)
Absolutely. Now, listen, appreciate that. I’m hearing you a lot say we saying we a lot. And so I want to pick your brain a little bit when it comes to relationships, right? Has relationships served you well? Do you believe in building relationships? Like, what is your outlook and perspective on relationship building within business?Dan Haberkost (15:46)
absolutely with with employees with investors with realtors absolutely essential. I mean, we have so many realtors on the ground that we rely on. you know, I rarely see these pieces we buy in the Carolinas.because I have good brokers on the ground that know land that help us and look at all of them. Colorado, I go back there quite a bit, but still oftentimes we don’t even see them in person there. ⁓ Same thing with investors. mean, once you have people that really trust you, it just makes it so easy. I mean, there’s people I just call, hey, I have this coming up, I need this much money. Great. And that’s that. And they just send the money like they, you know, they trust me implicitly at this point. And that is
really key to making business easier, right? Because you don’t have that and then there’s a lot more time you need to spend to get investors and build trust and show them the deal. And so that’s just true across the board. know, the realtors we work with, I don’t have to convince them of anything. We just send them an address and they give us their opinion. They go check the property out. And so trust just makes trust and good relationships just makes everything easier in really all aspects of business. So it’s absolutely essential.
Quentin Edmonds (16:52)
Man, I love it. I love how you talk about trust. Trust. I have a saying that, well, I borrowed the saying. It’s not like an original thought, trust is gained in drops and lost in buckets. Right? So trust is just a big thing. You know, it’s these little things that you do with building relationships that is just gained over time. And so when I listen to you talk about you got brokers on the floor, got, you got people, agents out there, you have people on the ground.even when you can’t physically be there that you trust, obviously, and they trust you, it just makes everything, it makes the whole system once moved. And so ⁓ I appreciate you saying that and bringing that word trust into the conversation. Listen, Dan, is there anything, any topic that we have not talked about that you would like to talk about? Or is there any kind of words of encouragement, motivation, education that maybe you want to leave without viewers? I would love to hear it if you have one.
Dan Haberkost (17:50)
Well…I think just a distinction between what I do and what many people think of when they think of land, right? So I talk to people all the time and when you reference land, the only thing that they think of is large pieces of land that are close to major cities that would be used for full blown entitlement projects. And what do I mean by that? I mean, you know, the subdivision that a developer would prepare for D.R. Horton to build on where they bring in streets and roads
and they have quarter acre or 10,000 square foot lots with water sewer power all ready to go. You can make a lot of money doing that. I know people doing it, but it is incredibly cash intensive. You can get delayed years and years by the city or county or metro district, whatever oversees the area. And it’s just a hard business. Again, I’m watching friends of mine do that and I don’t necessarily envy them. And I like to play within the, by right, the world of
what you can do by right. And most places, you know, maybe not especially regulation heavy places, but most places in the Southeast and all of Colorado, they have kind of a litmus test where if your subdivision falls within this set of boundaries, you can do it by right. Or in some places with a very minor clerical process that acquires just a few fees and a few check boxes.
And that is a whole different type of, I wouldn’t call it development, you can call it whatever, where you can take a large tract of land, split it up substantially smaller and get that premium for the smaller lots without dealing with all the headache that most people think of when it comes to development. Right. So that’s the world that I play within. Before we got on here, I was spending quite a bit of time on Colorado Division of Water Resources.
we have a really prime piece of land we’re buying where we might actually take a portion of it and do a more, well, a major subdivision would be the term. But I have stayed away from that very intentionally because it’s just a different game. It’s longer time horizons, more uncertainty, more capital needed, and potentially a massive payout. But also I know a lot of people have gone broke doing that. So I think that distinction is really important. And one other thing I want to comment on is you know all
Almost all our businesses direct to seller and a huge bucket of our deals are distressed title where it’s land, right? And so I’m not flipping trashed houses, but we get all kinds of properties that have some sort of title problem. The stuff you run into is crazy and it makes you wonder how did it get planted this way or.
What was the original developer doing? But you know, we closed a big one in South Carolina and the last month that we just listed that we just had to, we had to get access. had physical access, had no legal access. So that’s a common one that gets us great deals. You know, we do lots of quiet titles, probates. You just run into weird issues where you’re calling relatives and neighbors and trying to get clear title. And we get lots of good deals that way as well. so there’s plenty of just simple flips where we got a great deal because something was wrong with the chain of title.
We corrected that and got a good deal in the process.
Quentin Edmonds (21:01)
Yeah, I love it, man. I love it. I love how you’re figuring things out. I love the distinction that you’re making, really kind of educating people on what you do. I absolutely love it, man. And I appreciate you so much, man, for coming through, sharing the information. If someone wanted to reach out to you, connect with you, collaborate, learn more about what you’re doing, how can they get into contact with you then?Dan Haberkost (21:23)
Yeah. Look me up on Instagram or any of the socials, Dan Haberkost. And then also I host a podcast, the big picture blueprint with a co-host where we interview lots of people in the land space, but real estate in general. It’s more of a 201 show, not a one-on-one. So if you’re in the business or you’re investing in real estate, you’d probably find it interesting.Quentin Edmonds (21:42)
Absolutely. Well, listen, Mr. Dan, I thank you so much, sir. Thank you for your time, because time is definitely valuable. You know that. Thank you for your story. Again, like to get your vulnerability sharing. I really appreciate that. And definitely thank you for your perspective. Thank you for the way you think, for your mindset and bringing that to this podcast. I greatly appreciate it. Thank you for coming through.Dan Haberkost (22:06)
Yeah, thanks for having me, man. This was fun.Quentin Edmonds (22:08)
Absolutely. Well, listen, y’all heard Mr. Dan, you can’t tell me you did not get the value out of this conversation. So definitely check him out, check out his podcast, but definitely make sure you’re subscribed here because I promise you we’re going to continue to bring amazing people up just like Mr. Dan. So, sir, I want to say thank you again and to everyone else. We’ll see you on the next time.Dan Haberkost (22:30)
Thanks, Quentin.
