Unlocking Puerto Rico: 5 Secrets to Thriving in Real Estate Investing

Dylan Silver (00:01.356)
Hey folks, welcome back to the show. I’m your host, Dylan Silver. And today on the show, I have real estate value add investor, 27 years of experience and over 3000 successful real estate deals completed in San Juan, Puerto Rico. I’m a little jealous. Robert Crager. Robert, welcome to the show.

Robert Crager (00:23.429)
Hey, thanks Dylan, thanks for having me. Really appreciate it.

Dylan Silver (00:26.006)
It’s a pleasure. Yeah, absolutely. It’s a pleasure to have you on. We were chatting a bit before hopping on here and I know out there in Puerto Rico, like in a lot of the Caribbean islands, the electricity isn’t always as constant as it is out here. We sometimes take it for granted. What’s it like out there in San Juan today?

Robert Crager (00:47.143)
I signed in with my phone to talk to you at first because I was sitting here in the dark as we were preparing to go on and twice the power has gone out this morning. I don’t know why. It’s popping in and out. But the island of Puerto Rico doesn’t need a good reason for the power to go out. It can go out sometimes for a few minutes or sometimes for an hour or even a few days. It just depends on the mood of the island, I guess.

Dylan Silver (01:14.519)
Yeah.

Robert Crager (01:15.387)
The power grid’s hopefully getting better. It has gotten better since I came to the island seven years ago. After Hurricane Maria, the lights were out for about six months. And now it’s way better than that. We usually have power.

Dylan Silver (01:31.886)
Now you’ve been out there for seven years and I mentioned to you before hopping on here, we were chopping it up about I’m moving out to a Caribbean island myself, not Puerto Rico. But when I was thinking about moving out there, was because I loved the culture and then I was thinking about dollar arbitrage and really just being able to do this remotely. What was your motivation to move to Puerto Rico?

Robert Crager (01:56.871)
Yeah, so that’s a great question. We had been value-add real estate investors going to foreclosure sales throughout Florida for 20 years, buying a couple houses a week, fixing them up and selling them. And our business had kind of peaked around 2015. We were used to doing 110, 120 houses a year. We only did maybe 85 in 2015. In 2016, we were down to like…

70 and then in 2017 we were down to like 55 houses, something like that. I don’t know what the exact math was, but my money was hard to get on the street and my percentage return if I did everything right was about 20%. So I started looking for a new market somewhere in mid 2016 and by the end of 2017 I knew that we were going to go to a new market. Puerto Rico then had this massive hurricane, Hurricane Maria, that really, really just

crushed the island. And I’m from Florida. I’ve been through this hurricane cycle half a dozen times or so now, maybe even more. And it’s always the same thing. There’s a five year cycle. So I was looking for markets. Puerto Rico was on the list and then Hurricane Maria happened. And that was a driver for me. I showed up in 2017 just after Christmas. The lights were still off, blue tarps everywhere.

Dylan Silver (03:00.494)
Yeah.

Robert Crager (03:22.629)
And what I thought I would see was hurricane damage. And what I saw was this kind of generational distress. And I just thought this is a guy like me’s paradise, right? Like there’s a never ending supply of great projects that I can take. We call them zombie houses or the ugly duckling. And you know, basically the worst house on the street and they’re everywhere on the island. And then fix it up and make it the best looking thing on the block and sell it back to a local.

Dylan Silver (03:33.71)
Yeah.

Robert Crager (03:53.479)
to hopefully do some good, leave the place better than we found it. That’s sort of the idea, right? And that’s why we came here. We thought our money would go further and that we could make a little bit better percentage return safer. So that’s played out over the course of a couple hundred deals. Our kind of floor is about 40 % returns on flips, which is phenomenal. Our ceiling before we came was about 20 % on the same kind of flips in Florida.

So our money also goes about three times as far, even today, as…

Dylan Silver (04:25.474)
I want to get a little granular and ask you about what it was like.

starting investing in Puerto Rico. Do they have comps out there? I know in some of these places, they don’t have comps. you know, it is you know, you can go out there without a visa. It’s a US territory. And then also when you’re purchasing these these houses, how are you acquiring them? Is it mailers? Is it someone doing a door knock? How are you finding these properties and getting these deals done?

Robert Crager (04:38.364)
Yeah.

Robert Crager (04:56.337)
So it’s a great question and you’re gonna find it when you move to the island next door, the DR. The data is tough, right? Like Puerto Rico and data, they’re not something that you kind of put in the same sentence. They don’t really go well together, especially seven years ago. So it was extremely difficult to find comps. It’s a very antiquated system. They don’t have a…

a clear MLS and so a lot of pocket listings and when you have that inefficiency then there’s a big arbitrage. So again for a guy like me that wants to buy the stuff that he knows needs to be fixed up it was a dream because I’m willing to put in the work and I’m willing to figure the stuff out even without the data. And I had just gone through everything getting automized in my world where

going back, you know, 10 years ago, even we were live at an auction every single day and we were part of the good old boy network. So if you came into the auction, we had control of the room and we could, we could run you off. We could invite you in. We had control though, right? So all of that stuff got automated. And then, and then now if you go to the foreclosure sale where I used to go, you do it online. You can do it from Texas and buy houses in Florida and you can get all of the data.

at your fingertips. So I was used to being live in person and not having good data. I like that. I prefer it to be hard. And it’s much harder. Data is much harder. So how do we buy things? When we first came to the island, we purposely sought out friendly realtors who liked real estate investors, and we sought out other real estate investors. And we asked them to bring us deals. And there were about 12 of them that we met. And I’m talking about like first week we met.

Dylan Silver (06:34.018)
well.

Robert Crager (06:49.799)
as many people as we could. It worked out to, think, 12 people. Six of them, or all of them brought us deals. Six of them said they would invest in the deal with us if we bought it. And so we bought those properties. We did those investments. We partnered with local people who knew what they were talking about. And the idea was that if you were willing to put your money where your mouth was, we felt comfortable with it. And they were small investments. know, they were less than $100,000 all-in investment.

to buy it, fix it, and then hopefully put it back on the market. And it worked really well for us. We still do business with all of those guys today. And we sort of started expanding our business through partnerships. And that’s been the idea the entire time that we’ve been here on the island. We invite locals to partner with us. We invite people to bring us deals. And we’re really, really big on community and inviting partnerships and getting people out of the broken system of the

The rat race, you might call it. I love to find young people who want to be entrepreneurial. Anyone who’s interested in real estate, if they’re willing to come and work with me. I got a guy sitting next to me right here, Adan, and we partner on a lot of stuff. He worked with me for a year solid before he ever bought his first deal. We were doing this YouTube stuff, and we made this amazing trade where he was like, hey, I’ve got a skill set. I can help you with what you’re doing.

Dylan Silver (07:50.264)
Yeah.

Robert Crager (08:17.773)
online and you teach me real estate. And so we would go work 12 hour days looking at real estate and he would film it all and put it out. was, and it worked out really well. Now he’s a real estate investor. That kind of relationship is really cool, right? And I love to invest in anyone who’s willing to come and bring value and put the time in.

Dylan Silver (08:40.576)
Now, going from any US state, mean Florida, we’re in Texas, maybe there’s some more Spanish, different culture still, right? Because there’s lots of places in Florida where it may feel like the Caribbean, but then you actually go and you’re like, well, this is the real, right? So when you go from one place, Florida, to Puerto Rico, did you have anybody saying, well, you’re crazy? You know, I got that when I went from automotive to real estate. So I’m imagining maybe

you had some of that going from.

Robert Crager (09:11.911)
I don’t think I had one person that didn’t say I was crazy. And I probably was a bit crazy because in 2017, flying to the island, like I’m on an empty plane, and then everyone is flying back to Florida. So I’m the only fool who was flying to the island at that time to go and buy real estate or fix houses or whatever it was that we really were coming at that time to see what we would find. And we hit it really well.

Dylan Silver (09:15.704)
Yeah.

Robert Crager (09:41.457)
But yeah, culturally, very different. I came to the island, I didn’t speak a lick of Spanish, and I never struggled really to do business. I partnered with locals, so that fixed a lot of my language barrier. culturally, it’s amazing, right? this, yeah, it’s just…

Dylan Silver (10:01.654)
It is amazing. Let’s talk about that. Yeah.

Robert Crager (10:07.013)
the hospitality that you receive. And I think it’s the same in the DR, because I’ve been there a few times as well. But I can remember first week on the island looking at real estate and it’s 80, 90 degrees outside and a little old lady, she’s like 80 years old, invites me into her house. She doesn’t speak a lick of English. I don’t speak a word of Spanish. And she has me sit at the kitchen table and has given me an ice cold drink. And we’re trying to communicate for like an hour. And basically it was like,

Dylan Silver (10:11.907)
Yeah.

Robert Crager (10:36.313)
man it’s hot gringo come inside let me let let you cool off a little bit and that was the way that the island just kind of was from day one as soon as soon as i got here it was it was just something where where they were completely meeting me with open arms and and i fell in love pretty quickly you know it was it pretty amazing

Dylan Silver (10:39.512)
perfect

Dylan Silver (10:51.842)
Yeah.

Dylan Silver (10:56.29)
I want to talk about that. the thing that was most mind blowing to me, like it’s hard for me to explain this to Americans who haven’t been to a Latin American country, is here.

I’m in Dallas, I grew up in New Jersey, I was in Boston for six years, Boston, Massachusetts. You have to go out of your way to create community. People talk about creating community, know, joining groups, church, so on and so forth, boom, boom, boom. And if you don’t do these things, you’re literally gonna end up being alone most of the time. That’s just our culture. People avoid, people avoid. I grew up 27 miles from Manhattan. You know, you’d be walking around all day and no one’s even looking at you. And you’re like, there’s

so people around you, but you’re like ants. And then going to Santo Domingo, I was a foreigner, didn’t speak the Lick of Spanish the first time that I went, and you just end up…

being welcome and making friends and then you also see that’s how they are. That’s how they are. And no one’s eating alone. The community is constant. They’re outside. If they’re in their townhouses or condos, they’re outside. There’s music at all times. We’re basically isolated in comparison. That was the vibe that I got at least.

Robert Crager (12:18.939)
I think that’s true. I’m from central Florida. I think I’ve been friends with one neighbor my entire life, other than when I was kids and we were the neighborhood kids were all friends. But once I was out and established and a homeowner, you hardly talk to each other. You get up, you go out, you back out, you may wave to each other, but you don’t even know your neighbors. And here it’s like you said, it’s just very different. The hospitality.

Dylan Silver (12:26.264)
Light.

Dylan Silver (12:35.342)
Wow.

Dylan Silver (12:39.47)
You told me.

Robert Crager (12:47.343)
You hear about Southern hospitality and you do get that. mean, you live that in Texas, it’s true. We were recently in Louisiana and everyone was very, very friendly to us there too. But the hospitality here, it’s just like you said, they’re always going to invite you in and have a drink, some food and some music too. Yeah.

Dylan Silver (12:55.0)
there.

Dylan Silver (13:07.81)
Did you know going out there, had you been to Puerto Rico before? Had you traveled abroad in these places? Kind of knowing. Yeah.

Robert Crager (13:12.879)
No, so I travel abroad quite a bit. Yeah, that’s one of our things we like to do. We like to live free and go wherever we can. But I’d only been to Puerto Rico to go on a cruise. So I really didn’t have an idea of what the island was like. Other than I’ve been to old San Juan, you know, the cruise ship comes in, you go out for a few hours, that was it.

Dylan Silver (13:35.246)
One of the interesting things that I historically, and I’m no historian, but historically, and I don’t know if this is 100 % accurate, but Santo Domingo was maybe the first colony of the Spanish Empire when they were expanding out west. So Puerto Rico’s right over there too. And then they focused on Mexico and other parts. But when we think of the Americas,

Robert Crager (13:51.953)
Mm-hmm.

Dylan Silver (13:59.032)
we talk about Christopher Columbus and all this stuff, no one really thinks about Puerto Rico and the Dominican Republic, but these are actually the first places, the first places that Europeans found. And it’s like incredible. And I’m sure you see it in Puerto Rico. In Santo Domingo, you’ll see these buildings that look.

like super old. You could compare it to in San Antonio, you have the missions, right? And I’m like, wow, they have this right here standing in the middle of the city. And they were like, yeah, that was the colonial zone. And it’s incredible this thing.

Robert Crager (14:32.005)
Right. You have old San Juan, you have four or five hundred year old forts and buildings, five hundred years old. That’s pretty amazing. Coming from Dallas, Texas or Orlando, Florida, where if it’s, you know, 50 years old, we’re like, man, that’s old.

Dylan Silver (14:37.431)
Yeah.

Dylan Silver (14:41.262)
It’s pretty amazing.

Dylan Silver (14:47.212)
Yeah, and correct me if I’m wrong, the history of Florida is not super old, like it was a swamp up until, am I wrong in saying this? Until like the mid 1800s.

Robert Crager (14:55.783)
Yeah, was a swamp. we do have St. Augustine, which is the same kind of fort and it’s old as well. yeah, most of Florida got developed, you know, at the end of the 1800s and into the 20th century, 1920s. Yeah.

Dylan Silver (15:00.942)
Okay.

Dylan Silver (15:12.376)
want to pivot a bit here, Rob, and ask you about your perspective on remote.

lifestyle within real estate. think real estate is highly regional, but also because of everything with AI technology, zoom meetings. There’s a lot of ability for people to do real estate remotely. I intend to do it. You’re doing it in some way as well. What’s your perspective on it? And how can people achieve this type of lifestyle?

Robert Crager (15:43.857)
Well, I think the world is getting much smaller, right? And so this was a test for us. My wife and I had this idea that we would love to be able to go from place to place to place and live there for a few months or a few years. And of course, we’re going to do real estate. I can’t go on vacation for two weeks anywhere in the world without trying to learn what things are selling for in wherever I am. And so I think that as technology

kind of continues to go the way that it’s going and it’s going to go fast, it’s going to get easier and easier. I mean, look, when I was starting out 27 years ago to do virtual wholesaling, there was no way you could be in Dallas, Texas and wholesale something in California. It would have been nearly impossible. But now it’s super common. mean, every young wholesaler is not just wholesaling their area, their farm area.

Dylan Silver (16:29.23)
Yeah.

Dylan Silver (16:34.488)
Yeah, very.

Robert Crager (16:40.711)
they’re able to go online and wholesale all over the country, which is pretty phenomenal. And so why can’t you do that from the Dominican Republic? But for me, I like to buy in different places. we’ve been on mission trips and I invested in a hotel that services several churches in Tirana, Albania. And we’ve got a house that we purchased during the war in Ukraine for a pastor to…

Dylan Silver (16:44.118)
Yeah.

Dylan Silver (17:08.568)
Wow.

Robert Crager (17:10.545)
to put some orphans in so that he could adopt some orphans. So we’ve been intentional about testing it and it can be done, right? Like you can do it. It’s certainly going to get easier. It’s probably not quite as easy to do the things that I’ve done yet, but as you get to where I am in life, I think it’s just gonna be seamless. You’ll be able to travel the world seamlessly and…

Dylan Silver (17:36.04)
different name.

Robert Crager (17:40.505)
invest wherever you are and then leave businesses behind. And that’s pretty cool. Leaving a business in Florida and watching it thrive while I separate myself from it and I still get that monthly recurring revenue. Wow, that’s been so eye opening. And now we’re probably, you a few years from now we’ll move off of the island and we’ll leave a business here and hopefully it will thrive as well and we’ll go somewhere else and we’ll start up again.

Dylan Silver (17:47.628)
Yeah.

Dylan Silver (18:05.356)
want to ask you about Florida because I’ve noticed talking about remote, right? There’s so many real estate entrepreneurs that look like they’re having a great time. And I also have talked to many of them here on this show. They got the beach in the background. They got the sun, right? They look like they just went for a walk. I’m like, man, you look healthy. And I said, what’s up with everyone moving to Florida? And I’ve spoken with people from Idaho, from Wisconsin, from Chicago, and they’re all like, yeah, we’re moving to Florida, St. Petersburg, Miami, Fort Lauderdale.

to New Smyrna Beach. said, man do I gotta move down to Florida? So what’s in the water in Florida? Why are there so many real estate folks out there in Florida? Is just the weather? What’s going on?

Robert Crager (18:45.383)
Well, we do have great weather. Right now we have a phenomenally well-run state as well. So I cheerlead Puerto Rico a lot because I think it’s got a lot of room to grow, to go up. I cheerlead Florida for a different reason. Like if I’m living in certain parts of the U.S. and had the chance to move to Florida, I highly recommend it. We have great weather. We have a pretty well-run governance.

I think Florida’s kind of on fire. And that’s why you see that. I don’t want to get political, but if you see what happened recently in New York and who’s likely to be the mayor there, it’ll just force more people to come down to Florida. And we’re glad to have them, right? I think it does have to do with whether it’s red or blue a little bit.

Dylan Silver (19:16.302)
Yeah.

Dylan Silver (19:21.016)
Sure.

Dylan Silver (19:28.174)
for people.

Robert Crager (19:40.523)
Texas is, I would say the same thing about Dallas. Like I’ve been to Dallas twice in the last couple years. I love Dallas. Like I would, if I didn’t live in Florida, I’d live in Texas. I love Dallas.

Dylan Silver (19:47.182)
It’s very good place.

Dylan Silver (19:53.016)
want to ask you, so in Texas we’ve got four major cities, San Antonio, Houston, Austin, Dallas, and I personally think that Dallas is the best for single family home real estate investing because you got a lot of investors and you got a lot of people involved and lenders and we’ve also got Houston, which there’s so much cost effective real estate out there. Also from a living standpoint, a lot of people love Austin because you’ve got Lady Bird Lake and you’ve got so much activity.

you really can’t go wrong with some of these cities. On a personal note, what’s the best city in Florida? If I was gonna go move out there to Florida, where would you tell me to go move to in Florida?

Robert Crager (20:34.023)
You know, I’m biased because I’ve been in Orlando most of my life and I love Orlando, but I really like the Tampa St. Pete area a lot and there are parts of South Florida that I like. I’m not a huge Miami guy, although I think people that live there love it. But you know what, you can’t go wrong and you talk about the lifestyle and I’m the flip-flop flipper and that’s not because I moved to

Dylan Silver (21:01.155)
Yeah.

Robert Crager (21:03.089)
Puerto Rico and started wearing flip-flops for really for 25 years I’ve worn flip-flops and and and worn fishing shirts and you know I like to go fishing and I I live that lifestyle and Florida’s just a great laid-back place I I don’t know if I could pick one I right now I’m kind of enamored a little bit with the Tampa St. Peter area that that might be a place that we will move when we come back from Puerto Rico we might end up over there on that coast

Dylan Silver (21:33.15)
I’ve heard great things. had another guest on this show, a real estate broker, believe, in that area. Siesta Keys, is that out there? that out? That was a lot going on on the West Coast for sure of Florida. We are coming up on time here, Rob. Where can folks go if they want to learn more about your business or to reach out to you, get in touch with you in any way?

Robert Crager (21:41.125)
Yeah, yeah.

Robert Crager (21:55.131)
Yeah, so you can find me on YouTube, the Flip-Flop Flipper, Robbie Kroeger, the Flip-Flop Flipper. We’ve got 3,000 videos out there. We tell you what we do, how we do it. We talk about why. We really like to invite partnerships. If you want to get a hold of us, we also have a school community called the Flip-Flop Flipper. It’s a free community. You can find that in all of the links to any of our videos. And we have a premium community under that, but that’s something that we could talk about later.

You can also reach me at theflipflopflipper at gmail.com if you want to send me an email. Any other place that we should shout out at on? I think that’s it.

Dylan Silver (22:36.844)
All right. Robert, thank you so much for coming on the show here today.

Robert Crager (22:42.139)
No, I appreciate you. Thank you for having me. I’m glad I clicked that little button if anybody else sees it and you guys are inviting people to come on a podcast and have conversations. I think that’s great. And the more conversations that we can have, the better this world can be. So thanks a lot for having me.