Why Multifamily Investing in Dallas Could Be a Huge Opportunity Right Now | Matt Picheny

Matt Picheny (00:00)
And so I think that right now is actually a really good time to buy.

Because I think that as we move forward, it’s not that I’m expecting there to be some, rates are going to go down or something amazing that’s going to happen. But I do think if you look at this with a five year time horizon, deals that you’re getting now at a really good basis, I think if you can operate them well and you’re smart in the way that you structure them, you get good, durable debt, then I think it could do very well.

Scott Bursey (02:04)
Welcome back to the Real Estate Pros Podcast. I’m your host Scott Bursey. And today we have a powerhouse joining us. Matt Picheny. This guy is bringing a vast amount of fuel to our award listeners today, showing you how to scale beyond just

being an operator into a true legacy builder. Get ready to download some serious wisdom because Matt is about to drop bombs on how he finds, funds and executes multimillion dollar deals. Matt, welcome to the show.

Matt Picheny (02:35)
Hey, thanks for having me.

Scott Bursey (02:36)
It is awesome having you here. And Matt, for our listeners who may not be familiar with your journey, could you please tell us how did your career begin and what’s your main focus now?

Matt Picheny (02:46)
Yeah, I had a long and winding road to get to being a real estate investor. I moved to New York City in 1992 to pursue a career in theater. I was professional actor for a number of years. Then I got involved in digital marketing in the mid to late 90s, creating websites for companies that didn’t even have a website, right? This was the early days of the dot com. Then the dot com bubble burst.

All of my clients were going out of business and my business imploded. And right at that time, I was told by my landlord that I had 90 days to get out of the apartment I was living in. So I needed to find a new job and a new place to live. And so I looked, you know, all over town, you know, all over New York City, Manhattan’s where I lived. And I found a place way, way, way upper Manhattan in an area called Washington Heights, where I could actually

buy instead of renting. And so I bought an apartment and a couple of years later I sold that apartment and I saw my initial investment, right, my down payment more than quadruple in value. And this is back in 2003. I was making good money. I had gotten a job at Showtime, which was the cable television channel. They had been a client of mine. They offered me a position in house.

And so was making six figures, but that one real estate transaction was more than an entire year’s worth of salary. So that was a big light bulb moment for me. And that’s when I decided I wanted to pursue real estate. How can I do more of that? And I spent the next 15 years trying to figure out how to do that again. And I did, you know, fix and flips of properties. I built a vacation rental home.

I house hacked a duplex. But then eventually I found out about something called real estate syndication, where I could work with other investors. could pool our capital and our experience together and buy larger assets that I couldn’t do on my own. And that was in 2016 that I really started doing syndications. It is now 2026, so 10 years later.

And I’ve built up a portfolio. I’ve invested both passively, where I’ve just put money into other people’s deals and actively on the entire portfolio. If you look at the passive and the active together, and I always invest passively in the deals that I’m running, it’s over 12,000 doors that I’ve invested in during that time. But as a general partner, the deals that I’m…

active that I’ve been involved in, that I’ve controlled, that’s been almost 5,000 doors, close to $700 million worth of real estate.

Scott Bursey (06:19)
Matt, what an incredible journey. This next section is what we call the fuel flow. What are some core strengths of your operation as it stands today,

Matt Picheny (06:26)
Okay.

Yeah, I think that obviously we’re very good at, from an operations perspective, getting the work done, making sure that the properties are operating efficiently. I have a background, when I worked in the digital marketing world, I was a project manager. So I’m a PMI certified.

project management professional, which just means I’m really good at making sure things get done on time and on budget. And that’s really core to being able to run a real estate business. Now we use third party property management to manage the assets on a day to day basis. But as an asset manager, I am there looking at the properties.

⁓ sometimes in person, a lot of times remotely, because I’m based in New York and a lot of my properties are in the Sunbelt. But I am ⁓ on a Zoom call with our local team, property management team, on a weekly basis to make sure that everything’s running, reviewing the KPIs, just like I did in the project management world in the digital marketing, right? As I had worked my way through the ranks there and became a vice president, I was no longer day to day on particular.

projects, but I was overseeing project managers, directors who were looking at things. I would meet with them on a weekly basis, check in, see how the KPIs are doing and jumping in where I needed, helping put out fires. And that’s what I do today as an asset manager. I think the other strength that I have is being able to communicate well to people. So whether it’s somebody who is in the business,

or somebody who doesn’t know a thing about real estate, I would like to pride myself in the fact that I can still communicate with them and explain to them what’s going on, where there are opportunities, where there are challenges in the real estate world as a whole on specific projects. I think that communication is really key.

Scott Bursey (08:35)
It most certainly is Matt. And our listeners are gonna wanna know, what do you feel are some of the biggest opportunities right now that you’re looking to perhaps capitalize on?

Matt Picheny (08:46)
Well, I think we’ve had a few years now where the commercial real estate market and multifamily specifically has had a tough go. You know, there was back right before COVID and especially during COVID, there were very, very low interest rates and a lot of people were buying deals that weren’t necessarily the deals were okay, but the way that they structured them wasn’t the way that the debt was structured was not optimal.

And so quite a few operators have gotten themselves into a bit of a pickle with the debt. And so that’s unfortunately led to some people losing properties that they own or having to refinance, do capital calls, things of that nature to kind of right size things. Now, unfortunately, because of that, because of that stress, we’ve been seeing in certain markets

particularly, and I’m looking at Dallas as one, where evaluations have gone down quite a bit. They’ve gone down across the board, but when you used to look at what was going on, Dallas used to trade at quite a premium to Houston, to a similar property in Houston. And what we’re seeing right now is that Delta has compressed a lot, where they’re basically trading at the same amount. I think that that has to do with

these deals that are stressed where you have lenders taking back properties, auctioning them off. Also, we’ve seen really slow or even negative rent growth in certain markets. So when you see that happening, it brings values down. Cap rates have also been expanding, which also brings values down.

And so I think that right now is actually a really good time to buy.

Because I think that as we move forward, it’s not that I’m expecting there to be some, rates are going to go down or something amazing that’s going to happen. But I do think if you look at this with a five year time horizon, deals that you’re getting now at a really good basis, I think if you can operate them well and you’re smart in the way that you structure them, you get good, durable debt, then I think it could do very well.

Right. And I think that

You know, looking at those type of opportunities could be really a really smart move for investors.

Scott Bursey (11:48)
That was an excellent breakdown, Matt. And we’ve got to ask you this. What’s the one weakness a scaling syndicator needs to be most mindful of today in your view?

Matt Picheny (11:59)
Really making sure that you understand both the macro economic environment and the micro market of, you the specific market where you are and what’s going on there and making sure that you’re structuring a deal that’s going to be resilient to changes in both of those, right? The biggest problem that I think people had during the last cycle was being caught off guard.

and not being prepared for rates. look, I’m not immune to this either, right? And a lot of people did build in an increase in rates, but most people did not build in for rates to go up so quickly and to go up so high. So, you

being able to, so like I’m working, we’re working on a deal right now and what we’re doing is we’re actually assuming fully amortizing debt. So no matter what’s gonna happen on that deal in the future, it’s fixed rate, it’s at a very low rate. And we’re gonna be able to just hold onto that property for as long as we want. We’re not gonna have a gun to our head where we have to sell or have to refinance.

whether that’s one year from now or five years from now or seven years from now, this is fully amortizing debt. By the time this debt’s paid off, we’re going to own the property. it’s going to put us and our investors in a much safer type position. It removes the risk of what do the debt markets do and what does the real estate market do? Because if you never have to sell and you have a cash flowing asset, you can just hold on to it.

and wait for markets to recover.

Scott Bursey (13:50)
Matt, I’m really curious about this. What real estate opportunity are you most excited on for the next 18 months?

Matt Picheny (13:58)
Yeah, I mean, I think there’s a lot of opportunities out there. I have a lot of property in Texas, in Dallas specifically, although I own in many other markets in Texas, including Austin, Houston. But I do think that DFW, where the basis that things are trading at right now, can make for a lot of really, if you find the right deal and you structure it well,

I think it can make for a very compelling investment thesis.

Scott Bursey (14:30)
What is your secret to maintaining high trust communication with your your limited partners?

Matt Picheny (15:17)
⁓ There is no secret and that’s probably what the secret sauce is, right? Like there’s no secrets. We are very transparent with our investors. We’re communicating with them on a monthly basis on what’s going on at our properties, even if it’s bad, especially when it’s bad. If there’s something bad going on, things aren’t going as scheduled or as planned. ⁓ You know, we communicate that and lately in Dallas we’ve had, you know,

issues because of what’s going on in that market with rent growth not being where we had originally thought it was going to be when we projected everything out three, four five years ago. We’re still doing OK, but, you know, it’s not the greatest news to tell investors, you know, we didn’t hit our numbers this month. We’re still doing fine. We’re still profitable. But that that more growth that we were looking for, we didn’t quite hit. But I think our investors appreciate the transparency.

I think they realize that it’s just a function of where the market is. And I think they also realize that this is not a month to month type of game, right? This is a long term game that we’re playing here. And so we may have months or even years where things aren’t going exactly the way we had projected many years before, but we also have years where things do exceptionally well. You know, I had a deal in Dallas where, you know, we were in the deal for two years and we

doubled investors’ And that was like phenomenal. was nothing that we had ever planned for, but the market was behind us. And we had these really great tailwinds. Right now we’re facing some headwinds, but I will say, I think those headwinds are starting to die down, which is why I think right now is a phenomenal opportunity to jump into the market as either an active or even as a passive investor if you can find the right deal that’s structured the right way.

Scott Bursey (17:09)
Boom! Man transparency is so critical thank you for that thank you for that and what sort of wisdom can you leave with our audience here today our listeners what sort of advice would you like to give to our listeners.

Matt Picheny (17:12)
Yeah.

You know, it comes down to one of two things, right? One might be relationships because this is all relationship driven. The whole world is relationship driven no matter what business you’re in, what you’re investing in. But I really like to say that I think education is really important for people who, regardless of where you are, I I’m always trying to find new things, right? I’m always learning.

And I think that’s the most important thing, no matter where you are in your journey, is just getting that education, learning, learning more, you know, listening to podcasts like this one right here, are ways for you to learn more, get some more knowledge, really wrap your head around what the opportunities are out there and new things that are coming around. I mean, there’s new things being developed all the time, especially with AI.

I think it’s really gonna disrupt real estate as we know it today. And I couldn’t predict how that’s gonna happen. But what I am doing is trying to stay abreast of all the latest developments, especially when it comes to any sort of technology to make sure that I am not getting left behind like a dinosaur.

Scott Bursey (18:42)
Matt, this has been pure gold. It has been just tremendous. And for our listeners who want to follow your journey or collaborate with you, what’s the best way for them to reach you?

Matt Picheny (18:52)
Best thing to do is to go to my website at picheny.com. It’s P like in Peter I C H E N Y dot com. You can grab my book there, but also I have tons of free resources, tons of videos, lots of educational content completely for free. Sign up for my free monthly newsletter, you know, that gives investor tips all the time. So that’s what I would do. I would say go to picheny.com.

Scott Bursey (19:18)
What would you like our listeners to know about your book and what does it contain and that sort of thing?

Matt Picheny (19:23)
Yeah, so my book is called Backstage Guide to Real Estate and it talks about my journey through real estate. Sort of I gave you the one minute version at beginning of the podcast, but it really takes you from me knowing nothing about real estate to basically to where I am today. And it teaches what I call the 18 keystone concepts that I learned along the way. So it’s an educational book, but it was done in sort of a memoir style.

There’s a lot of humor in there to make it, know, real estate can be a boring topic to talk about and to read about. And so I try to make it a little more interesting, a little fun by bringing a lot of real life stories to the book and hopefully a little bit of humor.

Scott Bursey (20:05)
that’s so cool. And once again, Matt, thank you for joining us today. This has been an absolute masterclass.

Matt Picheny (20:12)
Well, thanks for having me. I appreciate it.

Scott Bursey (20:14)
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 operators, just like Matt, who are making huge moves in the market. Until next time, keep your standards high and your vision clear. We’ll see you on the next episode, everyone.