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Show Summary
In this episode of the Investor Fuel podcast, host Michelle Kesil interviews Tony Lin, a multifamily investor who shares insights on scaling his business through syndication, finding opportunities in the current market, and the importance of building strong partnerships. Tony discusses his approach to financial management, the significance of networking, and the lessons learned from setbacks in his investment journey. He also outlines his future goals for growth and emphasizes the importance of credibility in the real estate industry.
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Investor Fuel Show Transcript:
Tony Lin (00:00)
Yeah, so in today’s market, I’m really focused on finding great deals. We’re in a pretty rare opportunity. So I’ve been doing this for like about 10 years. And this is the first time that I see such a good discount on the properties to buy. Because of the recent, you know, floating rate debt, a lot of people are actually forced to sell their property or even in the worst case, you know,give the keys back to the bank, right? So right now there’s a short period of time that these properties are on sale.
Michelle Kesil (02:10)
Hey everyone, welcome to the Investor Fuel podcast. I’m your host, Michelle Kesil. And today I’m joined by someone that I’m looking forward to chatting with, Tony Lin, who’s been making serious moves in the investing space with multifamily units. So excited to have you here with us today, Tony.Tony Lin (02:33)
Yeah, thanks for having us ⁓ and really excited to be on the podcast.Michelle Kesil (02:38)
Awesome, I think that our listeners are going to take something away from how you’ve scaled your multifamily business in Dallas. So let’s dive in. First off, for those that are not familiar with you and your world, can you give the listeners a short version of what your main focus is?Tony Lin (03:01)
Yeah, so our main focus is buying large scale apartments. So what we call commercial multifamily, we mainly focus on buying properties that’s at least 100 units that brings efficiency in running the operations, as well as a really good pricing when it comes to, you know, renovations and because we’re buying in bulk. So what we do is we run something called a syndication.that allows small investors to pitch in a small amount, which allows us to scale up and buy institutional size properties and get the benefits that normally only large funds will receive. But we’re now able to do it even as a small investor.
Michelle Kesil (03:50)
Amazing. And where are you operating in? Is it solely in Dallas or are you doing this in other places as well?Tony Lin (03:59)
Yeah.Yeah, I actually own properties all over the United States. So I started out my background is in software. I’ve been doing tech for about 22 years. Super busy schedule. I would say 14 to 16 hours a day. Really doesn’t leave me much time to go out and manage single family homes and all that kind of stuff. So I looked into
massively investing into other people’s deals. So I have about 17 deals that I have invested in across the United States. That includes anywhere from multifamily to self storage to new construction, student housing, you name it. Basically in Phoenix and the Midwest and Texas as well as in places like
⁓ Indianapolis and, you know, all over the U S basically. So, but after learning all of that, I started out leading my own deals. ⁓ so, but most of the deals that I buy in it was in Dallas, Texas.
Michelle Kesil (05:57)
Awesome, love that. So what has been like the key to keeping this business running smoothly?Tony Lin (06:07)
Yeah, so, you know, being from an engineer background, I’m a little cursed with wanting to look at the financials really closely. ⁓ People operate apartments differently. I think majority of people rely on the third property management to run it for them. And then they just look at the end of a month report and go like, this is not good. Next year, next month, make sure you do better or I’m going to fire you. ⁓I’m the type of operator that literally stares at the financial every day and then have weekly meetings with my outside staff. We’re also texting throughout the day. So communication is really close and constant for us. And we do an in-depth analysis of all of our APIs every week, making sure that our expense is under control and also making sure that we’re keeping our
occupancy pretty full. So all of our properties are pretty much above 95 % occupancy even in today’s market because we cleave a really close eye on it. So something I’d like to say is like, think most property management companies can help you get to about 80 % efficiency. And me and my group, we’re the type that try to squeeze that last 10 to 15 % out of the efficiency.
Michelle Kesil (07:32)
Yeah, that’s great to have those strengths and keeping things lean and efficient. So what got you started with your investing journey? How did you learn how to become an investor?Tony Lin (07:48)
Yeah, so ⁓ I think it’s really because it is hard for me to, you know, with my tech income, you know, I always want to diversify. I don’t want to keep all the stocks in the companies I work for. I also don’t want to keep too much equity, you know, 100 % in the stock market either. So I’m always looking for ways to diversify. ⁓And that’s when I was looking into real estate. California wasn’t a good fit for me because, you know, it’s not very landlord friendly, which is why I usually, even though I’m from San Francisco Bay Area in California, I invest in out of state ⁓ places like, you know, usually red leaning states like Texas, which is ⁓ a lot more landlord friendly and easy to manage.
So it’s really, know, especially when I’m so busy, I’m not, I don’t have the time to manage them full time. Then I really am interested in passingly investing in deals and watching how those people do run their businesses. So I fly out with them to go do due diligence with them. I go check out properties and go meet the acquisition team. And that’s how I learned to build my own team.
and know what to look for during the inspection, the tours, how to actually operate the property.
Michelle Kesil (09:24)
Yeah, absolutely. That is a really good model. So that’s great. What are you most focused on solving or scaling to next?Tony Lin (09:38)
Yeah, so in today’s market, I’m really focused on finding great deals. We’re in a pretty rare opportunity. So I’ve been doing this for like about 10 years. And this is the first time that I see such a good discount on the properties to buy.Because of the recent, you know, floating rate debt, a lot of people are actually forced to sell their property or even in the worst case, you know,
give the keys back to the bank, right? So right now there’s a short period of time that these properties are on sale.
So I’m focused on buying newer properties at a large discount that we can hold and cash flow really well for the next, you know, five, 10, even 15 years, right? So we recently bought one, a 2017 construction for the price of a loan. So, you know, if you
have a good reputation, if you know what you’re looking for, you can find some real big discounts. And that one we bought, I think, you know, when they bought it, was $210,000 a door. We bought it for about 160k a door, right? So about a 34 % discount. So it’s out there. This is the prime time to do it. And that’s what we’re focusing on.
Michelle Kesil (11:37)
Wow, that’s incredible. How can people find these types of opportunities? Do you have a specific method or is it networking? What are those strategies to get these types of opportunities?Tony Lin (11:54)
Yeah, it’s a lot of networking with the brokers to get familiar with them. ⁓ And these are people I have worked with, you know, the past seven, eight years to build up reputation. But the most important thing is to let the brokers know that you’re serious and you have the ability to close. ⁓ Nowadays, a lot of people bid on deals, but you know, when they bid on deals, they don’t actually have the money ready.So when they try to go out and raise the money, ⁓ they don’t follow through and then a lot of deals fall out. ⁓ So as a result, buyers who have a certainty of close, who are confident about what price range are buying in, have a much better chance to win deals and to win them at a discount. Because certainty of close is worth a lot. It’s probably worth a five to 10 % discount on some purchases.
⁓ in the current market. definitely build relationships. Don’t put L.I. Don’t put offers on every property you see. Try to lowball them. You’ll just be labeled as a tire kicker. But instead, bid on ones that you are sure about. But when you bid, be serious. Go toward a property. Go see it in person. Talk to the brokers and build that confidence that you are the right person to buy the property.
Michelle Kesil (13:23)
Yeah, that’s some good advice. So are there certain like education or mentorship courses that you did in order to learn all this knowledge or where did you get your expertise from?Tony Lin (13:41)
Yeah, so I often say it’s not a problem to have knives to don’t have experience that partner with somebody that does. So I was lucky enough, you know, because I shadowed the first few ⁓ general partners that I invested with and they provided mentorship to me. They allow me to go on the tours with them. They I chat with them almost on a monthly basis on like, hey, what are all the things that’s going wrong with the property?you know, what kind of pricing are you guys applying things at? What are the things that, you know, to watch out for, right? So I had a lot of good mentorship in the beginning on how to get started. But really, it was a school of hard knocks once I acquired my first property. It was a 1960s construction. Everything that could break broke. So if anything, the experience of going through that older property was the best teacher.
for a lot of things, ⁓ Nowadays, I have a small mentorship group that I share that with everybody ⁓ to let them know that, ⁓ to do these right, make sure you slow down, okay? Understand the financials, understand the fundamentals before we rush out to buy phones because I think that’s where most people get in trouble. yeah, I try to pass on what little I know.
Michelle Kesil (15:50)
Yeah, that’s important. Yeah, so what are some of those like setbacks or pivots that you’ve had to go through on this journey and what lessons did you take away from what like you learned from overcoming them?Tony Lin (16:09)
Yeah, I think one of the most important thing is. It’s a common saying, but it goes, it goes like deals are easy to find, OK? Money is relatively easy to find, but people are hard. I think some of the hardest part in doing any kind of business is working with partners ⁓ that. That you basically are on the same wavelength with and able to work well together.I like to call them like this is your business wife or this is your business husband, right? You probably see them and talk to them more than your actual spouse in a day. And you know, the property that you guys acquired together is kind of like your child, right? But when dad and mom don’t get along, then things go really bad. So I think one of the thing to learn is really, you know, what kind of partner fits your style. ⁓
and ⁓ work the same way that you do, it’s just so important for a successful partnership. So for example, what I find is I like partners that have a lot of ⁓ business experiences. For example, my current bar partner, Jack, he’s great. He’s actually owned ⁓ seven restaurants here in the San Francisco Bay Area. And he’s had to
go through a lot of turmoil, right? Imagine dealing with all those cooks and waiters. So he’s tough as nails. ⁓ When things, know, when, you know, we have to deal with difficulties, he’s able to handle them without any issues, right? So these kind of partners, we don’t panic when trouble arises. We’re patient, we know how to work through it, and don’t get emotional, right? So we’re able to process them. But
I think that’s one of the key qualities that I look for in partners. And so far it’s working out really well because it’s never a smooth road, but having somebody who has been through some tough times, they know how to survive and work through the tough situation.
Michelle Kesil (18:28)
Yeah, that’s so important to have those people that can have that tough skin and can be there with you through those more challenging times because you’re going to go through them in this industry. It’s just part of the journey of that long-term game if you’re wanting to invest and stay in this world.Tony Lin (18:31)
Yeah.yeah.
Michelle Kesil (18:56)
Yeah. So what are some goals that you have for where your business is heading?Tony Lin (19:05)
Okay, so I think we’re on a run rate of buying about two properties a year, and that’s kind of what we’re looking to scale to. So right now we’re at about 1,000 units. I’m hoping to get to about 1,500 units by 2027. That’s kind of the goal that we set for ourselves. So that means, you know, next year we’re probably looking to acquire two more, maybe even three more properties.It’s really the golden period before all this, all these depressed loans get worked over, right? So I think we have one more year, one more good year left where we’re pretty much at the bottom. And if you can buy right, and buy right, what I mean is at this period, you can buy for a really good price, right? You really make your money when you buy the property.
at the right price and then we can hold them on for the five, seven, even 10 year term, then we’ll do pretty well. yeah, for term, I think we’re in a good position to buy a little bit more assets, good looking assets.
Michelle Kesil (20:20)
Amazing that is such an exciting goal and a good trajectory to be on So let me ask you this when it comes to Growing your business and building new relationships What are some things that have made the biggest difference for you?Tony Lin (20:43)
I think it’s really getting out there and sharing your knowledge with people. I think in today’s world, it’s hard for somebody to evaluate whether or not you’re a good person to invest with, right? But the more you’re able to let people know about your management style, like for example, my management style is very considerable in my projections.So where people could be projecting an extremely high rent growth, a really good market that we exit in, I tend to make things more ⁓ conservative. ⁓ In the Asian community, we tend to be a little bit more conservative. ⁓ My key point is I want to be able to sleep at night. So if I project something more conservative, I have more confidence of hitting that, I can sleep well at night knowing that I’m going to hit those targets, right? ⁓
And luckily, you know, ⁓ my investors have the same kind of thinking and that’s and believe in me. So while there’s people projecting 20 % returns, we conservatively project like 13 % return for the same project, even though we consistently exceed those ⁓ expectations. Right. So yeah, I think ⁓ it’s my conservative style. It’s, you know, why share about
all the trials and tribulations of running these properties and what actually goes on. People realize that, we were actually ⁓ fixing and handling a lot of problems for them and ⁓ that they don’t have time to address, But they at least they trust that there’s somebody at the helm that ⁓ knows how to do these things and very ⁓ involved, right? ⁓ Additionally, we also put in a lot of our own money into the deal.
So on each deal, we usually put in a minimum of 10 % of the overall capital is from our own money. Because if we find a good deal, we want to invest in that deal as well, right? that’s why, yeah. So we definitely have our own end of the game. And then also really careful engineering style management, which is pretty different.
Michelle Kesil (23:10)
Totally, I love that. Thank you for sharing. So before we wrap up here, if someone wants to reach out, connect, learn more from you, where can people find you?Tony Lin (23:21)
Yeah, you can email me directly at my normal email, which is lin.tony.gmail.com. ⁓ Or you can also check out our website. It’s called linkmultifamily.com. L-I-N-K, multifamily.com, word. And then you can check out some of our projects there.Michelle Kesil (23:51)
Amazing. I appreciate your time, your story, and your perspective. So thank you for being here.Tony Lin (23:59)
Yeah, thank you so much.Michelle Kesil (24:03)
Of course, and for the listeners tuning in, if you got value from this, make sure you’ve subscribed. We’ve got more conversations with operators just like Tony, who are building real businesses and we’ll see you on the next episode.
