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Show Summary
In this episode of the Real Estate Pros podcast, host Michelle Kesil interviews Cody Cramer, a successful short-term rental operator. Cody shares his journey from the hotel industry to real estate investing, highlighting the importance of strategic partnerships and effective management in scaling his business. He discusses the challenges of growing a short-term rental portfolio, the significance of proper underwriting, and offers valuable advice for aspiring investors. Cody emphasizes the need to work on business processes rather than getting bogged down in daily operations, and he shares his vision for future expansion in the real estate market.
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Cody Cramer (00:00)
So we actually were looking at syndicating a 10 unit villa complex within Panama City Beach is just across the road from beach access.we were trying to get some, some investors it didn’t end up working out, which was unfortunate, but, even fortunate, you know, when we actually were able to manage it, the owners that were trying to sell it were so impressed with what we were looking at the details, ⁓ they fired their current management.
company and gave us the contract and so we were able to work with them in peak season which almost instantly doubled our revenue and so that was a huge growth driver for us and again it was you know kind of right place right time I guess being able to you know leverage that partnership what we didn’t even know was a partnership at the beginning into a very lucrative one for both sides so.
Michelle Kesil (02:26)
Hey everybody, welcome to the Real Estate Pros podcast. I’m your host, Michelle Kesil, and today I’m joined by someone I’m looking forward to chatting with, Cody Cramer, who is a real estate investor and short-term rental operator. So, excited to have you here today, Cody.Cody Cramer (02:43)
Thanks for having me, Michelle. I’m excited to be here.Michelle Kesil (02:46)
Yeah, absolutely. I think our listeners are really going to take something away from how you’re navigating the short-term rental space. So we can dive into all of that.Cody Cramer (02:58)
Perfect.Michelle Kesil (03:00)
First off, for those who are not familiar with you and your work, can you share what your main focus is?Cody Cramer (03:05)
Yep, happy to. So I am a short-term rental owner and operator. I operate across three markets, particularly in the Southeast. Soin the Destin, Panama City Beach area, also in Myrtle Beach, and then up in the Smoky Mountains. And I’ve been a short-term rental operator for almost two years now, as far as this business goes. So I co-own a business with my partner. It’s called Ascent Co-hosting. And we’ve leveraged a couple of partnerships to be able to buy a couple of properties, in Panama City, one in Myrtle Beach. And then we also actively manage others as well. And we’ve certainly had our fair shares
of wins and losses as far as additional deals over last two years. So my main focus is really growing that business. It went from zero to 30 properties and about $2 million in revenue in 18 months. So it certainly keeps me busy at this point in time.
Michelle Kesil (03:58)
Yeah, absolutely. That’s amazing. How did you get started with your investing journey?Cody Cramer (04:07)
Yeah, so I think specifically in short term rentals, I’ve been in the hotel industry or I was in the hotel industry for about 10 years. And so I think having to manage vacation rentals, which is.back in the day, you know, in the mid 2010s is everything was very manual. Everything was pretty new, I would say, that Airbnb had just launched. And so had a familiarity with vacation rentals, really enjoyed the hospitality of everything. And then I think as I kind of grew in my career, I really wanted to
start to really buy some assets and really start to kind of plan out generational wealth for my family and for my kids kids and so being able to invest in in real estate and in pieces of property was something that was very very interesting to me and so I thought why not combine both of these desires and experiences and you know, it’s kind of dumb luck how how we started our management company
but certainly am thankful for the ride so far.
Michelle Kesil (06:00)
Yeah, amazing. And what do you feel have been some of the main keys that have made the biggest difference in allowing your business to be able to grow at this rate and to run smoothly?Cody Cramer (06:15)
Yeah, I think one of the main things we’ve been able to do, and I would defer to my business partner on this because he’s a lot better and seasoned at it than I am, but I would say creating strategic partnerships and relationships with people. So we grew from zero to 10 listings in a few short months only because within a mastermind.network that my business partner was a part of. We came across a financial advisor who was advising his clients to buy short-term rentals. And then, you know, we struck up a relationship and, you know, he wanted to pass somebody off to have this be managed since they weren’t going to actively manage it themselves. And so we created this nice pipeline to be able to fund and get started with these first 10 properties. And then we’ve had a couple other key partnerships that we’ve been able to leverage as well.
to help with some of the growth.
Michelle Kesil (07:07)
Yeah, amazing. How are you coming across these partnerships? just through like basic networking or is there a specific strategy you’re using?Cody Cramer (07:15)
youYes, I just referenced the first one with the financial advisor through a particular mastermind, but I’ll share the second one, which is part of the dumb luck kind of thing that we had.
So we actually were looking at syndicating a 10 unit villa complex within Panama City Beach is just across the road from beach access. You had like a rooftop
party deck, they were five stories, they were each five bedrooms. I think the retail price was like $15 million. And so we were trying to get some, some investors and people in place to try to actually buy this. And it didn’t end up working out, which was unfortunate, but, even fortunate, you know, when we actually were able to manage it, the owners that were trying to sell it were so impressed with what we were looking at the details, they fired their current management.
company and gave us the contract and so we were able to work with them in peak season which almost instantly doubled our revenue and so that was a huge growth driver for us and again it was you know kind of right place right time I guess being able to you know leverage that partnership what we didn’t even know was a partnership at the beginning into a very lucrative one for both sides so.
Michelle Kesil (08:35)
Yeah, amazing. And when you have these partnerships, is that in terms of like sharing the roles or raising capital or kind of everything in between?Cody Cramer (08:45)
Yeah, I think, you know, the way that we were trying to structure that villa was a management, almost like a GP LP structure. So we were, we were going to have a limited partner in place that was, would be, would have been a holdover from the original seller group. And then we were going to get a, a bunch of GPs and even a few more LPs in place to fund the deal and then for us to be able to run it. So.That’s how we structured it. I would say with the ones that we procured from the financial advisor, those are just management plays. So hopefully, the goal is to help have that arm of the business be able to help fund additional purchases down the road, additional capital needed for investments in the future. That’s the goal.
Michelle Kesil (10:11)
Yeah, amazing. And what do you feel was so like the secret to your success in scaling at such a rapid rate?Cody Cramer (10:19)
Yeah, I think for us, we were feeling a specific need for clients. So again, we got connected to a really nice network. These were high net worth individuals originally that just didn’t want to manage these assets. And so we were able to come in and manage that. And then through that, we were actually able to utilizethat partnership for these owners and actually by a duplex in Panama City Beach where my business partner and I are partners on that. We, the structure is we are basically the general partners. We didn’t bring anything to the table other than our management skills and we were able to bring in limited partners who provided the capital and then we ran with it still have it today and so those are some unique
benefits of having that pipeline of people because then it gets connected to another person and another person. And again, I give a lot of credit to my business partner because I’m not as good as he is at connecting those pieces. But I think that’s important in a partnership to be able to have people that leverage skills that maybe you have opportunities to grow in, if you will.
Michelle Kesil (11:32)
Yeah, definitely. That’s super crucial.What are you most focusing on solving or scaling to next in your business?
Cody Cramer (11:40)
Yeah, right now for us, We if anybody out there has short term rentals, once you get to the 10 unit or 10 door mark.things really start to ramp up as far as challenges and complications and just needs of the business. And so I found that once we hit that 10 mark, we really had to start creating some structures and processes in place. know, my business partner and I originally were just kind of flying by the seat of our pants and trying to figure it out. And, you know, once you get to that level and then you start to continue to bring more properties
on, you really need to dial in your business. And that would go for any business just in general. At some point, you’ve got to kind grow up and have the right processes in place. And for us, those processes are mainly being able to ⁓ really pass off or hand off specific responsibilities, like day-to-day operations, to our team so that we can be freed up to pursue additional partnerships or
management contracts or something else. And you know, have that saying work on your business, not in your business. And so I think that’s what we’re trying to do now so that we can be set up for growth, for additional opportunity down the road. Cause if you, if all your resources get tied in the day to day, then you really can’t plan strategically how to grow your business. So that’s what we’re actively focused on, you know, coming up in this new year in 2026.
Michelle Kesil (13:15)
Yeah, that’s important to have that structure in place to continue to scale.What are some of the main challenges you’ve experienced and maybe now looking back in hindsight you have that wisdom and that lesson that you wish you had previously?
Cody Cramer (13:31)
Yeah, I think there was for us when we were starting a new business, I think there was a little bit of trepidation on our part. You know, when we’re going into a new business, we want to be able to, you know, have the right partnerships and people in the room. And I think sometimes we were a little bit too deferential and hey, this is how we’re going to structure it. These are the components that we’re going to include or not include. And I think early on, I probably would have been a little bit more forceful, whether it becontract terms, whether it be you know closing particulars, those are things that we kind of just early on were a little bit more deferential on and I think those can set you up for even greater success if you do those things right. And so that’s certainly an opportunity for us, I would say.
Michelle Kesil (15:02)
Yeah, absolutely. What is maybe some advice you would share to people that are looking to start getting into the short-term rental space?Cody Cramer (15:10)
I would say if you don’t have any experience, I’m happy to help or I’m happy to maybe recommend people to help. I would seek some, maybe not necessarily mastermind type, but there’s opportunities to learn and grow. It’s unique and it’s dynamic. And I think, you know, it has the highest level of return as far as the type of rent that you can generate from a short-term rental.you know, compared to long-terms or mid-terms. But it also has a lot of risk associated and if you don’t underwrite it correctly, you may be underwater pretty quick. And I’ve seen that firsthand with some clients. And so I think…
get help, seek help, whether again it’s a mastermind or coaching program or something, it’ll help expedite your growth and your knowledge, but it’ll also help you avoid those mistakes. And uh again, when you’re getting into the space at the beginning, one of the great things is just like in real estate, you can snowball this into the next one. Well, it may take you a lot longer if your snowball from the beginning is really small.
or maybe it explodes or something and so you really got to be careful and you want to do this the right way so I would seek some help.
Michelle Kesil (16:28)
Yeah, definitely. Are there any maybe advice or tricks that you have for how people can maybe mitigate risk and access more of that profitability?Cody Cramer (16:43)
Yeah, I think, you know, I would say…probably in real estate in general, but certainly in my niche and short-term rentals, you win or lose the deal, not just in purchase price, but even before that in the underwriting. And I’ll give you just an example. In the first deal that I did, it was a partnership. I felt like we underwrote in a kind of positive way. And we kind of dotted our I’s and crossed our T’s. But one thing we didn’t
account for was the new tax assessment which the purchase price went from you know the owner bought it at 09 at a million dollars and it you know sold for 1.6 or whatever it was several years later and so we didn’t account for that I don’t know how we missed it to be honest but we didn’t account for that assess that change in assessed value and so when we were underwriting we underwrote it at I think the taxes were like ten or twelve thousand dollars and they almost doubled
because of the new purchase price and so those are little things that you know they seem simple but when you’re underwriting a short-term rental you’ve got to account for every single thing of and of course in a real estate deal you do as well but I’m talking things like what what are utilities gonna cost what are the what’s the property insurance gonna cost what are the supplies that you need to run the place like what is all that gonna cost and so I would say that’s a big mistake is if you can get your underwriting dialed in and I would
I always would lean towards more conservative. So if you think a property is going to generate $100,000, I’d probably shave that by about 10%. Maybe a little bit more just to be conservative and say, OK, if this passes the sniff test, when we’re being ultra conservative, then we know that if it does what we think it’s going to do, then you know it’s going to be that much more additional revenue or profit for us.
Michelle Kesil (18:41)
Yeah, definitely. I think that’s some great advice. You had mentioned like working on your business, not in your business. What does that look like? Like, can you expand on that?Cody Cramer (18:54)
Yeah, so for those thatagain, aren’t familiar within short term rentals, one of the key components when you’re operating is you’ve got to regularly check and adjust your pricing. So if you’re in a long term rental, the price is what it is. Maybe you adjust it every year, but in the short term rental space, just like hotels, you’ve got to, and they would call it dynamic pricing. You’ve got to adjust your pricing every day. And imagine doing that across 30
properties each you know 52 weeks out. So you’re pricing a year out at least. That’s a lot of time and effort if you’re really going to devote to each individual property. And even if you spent five or 10 minutes you know on each of those properties for multiple times a day, several weeks out, it takes a lot of time and effort. And so one of the things I’m doing to work on my business is I’ve actually partnered with
a third party vendor to help me manage that. So they’ve got a full dedicated team that’s managing dynamically pricing all of my properties. And then I’ve got to check in every two weeks. So I have the oversight. I have the kind of line of communication, but I don’t have to go in and daily do it. And I knew that, you know, over the summer I missed revenue for my properties because I couldn’t be in there every day because I had to work on these, you know, five or six other things with the
business and so that that’s one of the main ways I’ve been able to start to work on my business because it’s freed me up to do some of these other things that I just haven’t been able to get to because of this one revenue management component.
Michelle Kesil (20:35)
Yeah, definitely. There’s a lot of moving pieces to deal with, so it’s good to have those extra systems in place.Are you looking to expand and get into like different markets?
Cody Cramer (20:46)
Yeah, I would love to. I think for us…We’re already in three markets, specifically on the management and ownership side. I wouldn’t want to go into a new market unless it was a package of properties. So maybe it’s three or four or five, just from an economies of scale. You know, if you’re managing three different teams in three different markets, and then you’ve got a fourth team that you’re adding, but it’s only one property, usually the juice isn’t worth the squeeze. And so we would want to be strategic about bringing that on. almost brought
on a company or a client, they had, gosh, I think eight or nine properties in the Kansas City area. And so that would have been a great opportunity for us, or even we had an opportunity with a portfolio in Austin, Texas. That’s what we would want to do as far as expansion. But we do want to grow you know our management and ownership or partnership business. We want to continue to grow that. I think real estate’s a great investment vehicle in the long term. And so we certainly
are actively looking for deals for ourselves, for even just our network of investors. We’ve been able to assign a couple of properties to investors that we know and they’ve been able to get in. They got in last year at bonus depreciation, got in this year as well. And so those are the opportunities that we’re looking at for ourselves and for others.
Michelle Kesil (22:11)
Yeah, amazing. So before we wrap up here, if someone wants to reach out, connect, learn more, where can people find you and connect?Cody Cramer (22:18)
Yeah, I’d be happy to help. So our website is ascent, so A-S-C-E-N-T, ascentcohosting.com. But I’m happy to help or chat with anybody. You can email me at cody at, and then our website at ascentcohosting.com. And I’d be happy to chat, set up a call, shoot the breeze, maybe strategize, whatever it may be, I’m happy to help.Michelle Kesil (22:44)
Perfect. Well, I appreciate your time, your story, your perspective. Thank you for being here.Cody Cramer (22:50)
Thanks Michelle for having me, I really appreciate it.Michelle Kesil (22:52)
Of course. And for those tuning into the show, if you got value, make sure you’ve subscribed. We’ve got more conversations coming with operators who are building real businesses and we’ll see you on the next episode.
