Why Senior Housing Is the Next Big Real Estate Investment Opportunity

 

Ryan Byrne (00:00)
The senior community, here’s a few fun facts. It’s the largest demographic in the United States. It’s the fastest growing.

and it’s also the most affluent. Seniors in America control 75% of household wealth today. And not only that, their housing needs aren’t being met. I mean, we’re actively because because they’re not being met, none exist. We have to develop these communities from ground up because they’re not existing, the demand is already there.

Issa Hanna (02:08)
Welcome back to the Real Estate Pros Show. I’m your host, Issa Hanna, and today I have Ryan Byrne, the founder of Cashflow Capital Club and seasoned multifamily investor. Ryan, welcome to the show.

Ryan Byrne (02:19)
Hey, thanks for having me. It’s great to be here.

Issa Hanna (02:22)
I’m definitely excited to have you. We talked a little bit before. You are somebody who knows real estate. So I’m excited to pick your brain about a lot of things. But first of all, for our viewers at home, can you kind of run down your day-to-day operations? I know you’re an investor, but you also are heavy into the Cashflow Capital Club, right?

Ryan Byrne (02:44)
Yeah, we we started as lifelong investors. When I say we, it was me and my wife. We were active investors. We read a couple of books that really opened up our eyes to the benefits of real estate and then more specifically, commercial real estate, apartments, and apartment buildings, and really loved what that opportunity had to offer. Because the the opportunities that in that space in particular.

offer an opportunity to go after what we would say higher returns for less risk, where there are a ton of arbitrage opportunities and things that you know, you might be familiar with value add opportunities, where we can take a mismanaged, neglected apartment building, put in our team, and give it a new life that the tenants and the community are are willing to pay for.

And and we we found just a ton of opportunity there. And once we got started in that, well, we didn’t look back. And then we opened it up to our network of friends and family. We’re so surprised at the opportunity of or the appetite that people had to join us in our endeavors. And then that’s when we launched Cashflow Capital Club and started making it to investors just like ourselves who had the same mindset and goals, but maybe didn’t have all the time to.

Do and recreate what we created by themselves. So working together, we can all come out ahead with a better experience.

Issa Hanna (04:20)
Definitely and and boy, have you done a lot with Cashflow Capital Club. I did some research. You’ve been able to scale it pretty big. And when we were talking earlier, you said, and you’re happy to say it, one of the strengths of of your whole business, not just investing, but also Cashflow Capital Club, is your team. So can you shed some light on on the team aspect and and what kind of team you’ve put together?

Ryan Byrne (05:35)
Yeah, absolutely. You asked me how long I’d been in multifamily, and the answer was 10 years. But we spent a lot of that years as investors and as students trying to figure out every piece of this business on our own. And it’s just not the way multifamily works. It’s it’s really a team sport with very specialized verticals in multifamily where you have acquisitions, capital side, capital stack.

your your operations and execution to being able to sign on debt where you really needed a an experienced and well-rounded team to do it well, to do it effectively so that every everyone benefits. And that was our strong point is getting the right people in the room and putting those teams together in some of the most attractive markets in the US.

And then once we did that and we were successfully taking on these apartment buildings and turning them around, more and more opportunities came available to us because we just were on the broker radar. We were at the top of their list. When we started, no one knew who we were. And it was much harder to access those those deals. But once we got started, it was we had just had more and more opportunities being

dropped off or just presented to us and put in our lap for us to take advantage of. And then our investors got to kind of skip the line instead of finding these deals on their own. They could just join us in in the endeavor. And so that that was a huge advantage that we have today.

Issa Hanna (07:22)
Definitely. And one other thing that stuck out as an advantage that that people have dealing with you is your background in finance. You know, you can break down a deal on the finance aspect. I’m I’m sure on every aspect now with your experience, but the finance part of it, you can break it down almost to a T, make sure it’s a good investment and whatnot. So can you shed a little bit more light on that?

Ryan Byrne (07:48)
Sure. Going going back to my my origin story. Out of high school, I went into the Marine Corps. I didn’t know what I wanted to do professionally or academically. I I had this sense of adventure and serving the country. I spent a little bit of time in the Marine Corps. It’s like maybe a higher education is is the way to go because that that was a it was great. You had the camaraderie.

But I was like, man, do I want to do this for the rest of my life? I don’t know. So I went and got a degree in finance and accounting and then eventually my MBA, which led me to Wall Street, where I worked for a small investment bank. And then for seven years on Wall Street, I was in Excel, analyzing businesses, putting together deals. I was in the mergers and acquisition space. So underwriting and and doing the financial forecasting and modeling and and

putting together deals became second nature. And and then I I, you know, I read *The 4-Hour Workweek* and I read *Rich Dad Poor Dad*. And I was like, man, I’d like to really do my own thing in real estate specifically, and took a lot of that skill set into into the real estate space. And and so that’s that’s kind of where I got my background in in finance and accounting that I that I I use every day today. So

Issa Hanna (09:15)
Definitely. And and the great thing about real estate, and I’m sure you know, is you you can, like I said, speculate almost to the T and being in mergers and acquisitions and on Wall Street. And I mean, what a background to just jump into the real estate world. And for people at home, you know, real estate is life-changing money. If you do it the right way, or if you get with somebody like Ryan who can show you the ropes and and teach you.

to not make a bad investment, you can make a lot of money. So people like Ryan are people that you want to deal with when investing, you know, you don’t want to just lone wolf it at first, you know, even if it’s just advice. So Ryan, definitely a great origin story. Kudos to you, you know. Thank you for your service in the Marine Corps. You did a lot of stuff, you know, you had the guts to do what a lot of us didn’t. So definitely kudos to you on the Marine Corps.

And with that, I want to ask you a question now about something all investors face in our game, the real estate nightmare. So give me one time you had a nightmare in in in our business and then you had to overcome.

Ryan Byrne (10:59)
Yeah. I can go back to our first acquisition. We found two apartment complexes for sale. They were identical in their tenant base and their build. It was in Augusta, Georgia. One was 70 units. And we spent about a year and change to find this opportunity when we

set it out as a mission to go and find a ignored and poorly run apartment building. And we we found exactly what we were looking for. Both were owned by seniors who had let these properties go many years ago. They they were there were cash flowing machines for them, but they weren’t being maintained. They weren’t operating efficiently. And they were just kind of sitting on their laurels like

I I don’t know. Maybe there’s an unspoken rule with the tenants, like, hey, don’t put any maintenance requests in and we won’t raise your rents at at all. And granted, the tenants had very cheap rent, but they were living kind of in squalor. And that was the opportunity that that we found. It was in a you know, small town of Augusta, Georgia, considered a tertiary market. And we took it over and we had a business plan and an execution, a plan of attack.

but the mistake that we made was thinking that the operations that were currently in place were going to just radically change their mindset and adopt our business plan when they had been sitting there doing things the way they had been for gosh, you know, five, 10 years. And that the mistake of thinking that they would just be on board and see our vision.

It was it just cost us a huge time delay. I think that slowed us down by four months when we really should have started with a clean slate, a fresh start from the get-go. That I think that was a mistake and a lesson learned. You know, because we’re there looking for properties that are poorly run, and then we’re working with a team that are running them poorly, expecting them to do something differently. And that was.

I think that that was a mistake and a and a lesson learned. It was a kind of a naive approach from our standpoint too as owners and operators. Because they fought us the whole entire way. It’s like, no, you can’t do that. That’s not what that’s not how people want it here. And and as soon as we kind of ripped the band-aid off and got a new team in place, like it was it was smooth sailing after that. But yeah.

Issa Hanna (13:48)
I could see that being yeah, I could see that being a nightmare. Getting constant pushback from somebody else’s crew that you’re trying to keep on because you’re probably a good guy and didn’t want to fire them, you know. So I can definitely see that being a nightmare. But every every nightmare, like you said before, is a lesson learned. So to new investors out there, if you’re currently in a nightmare, if you face a nightmare.

just know when you get out the other get out of the other side, you’re gonna A know the exit strategy for that nightmare. And B, you’ll be you’ll be through the other side. You’ve made it through and you’ve you’ve learned a lesson. So yeah. Great, great advice for for our viewers. And another thing, and you kind of touched on it with with the last answer you gave me, an opportunity you’re seeing in the future is senior housing and the shortage of senior housing. So

Can you can you give us a little bit more about that as well?

Ryan Byrne (14:47)
Yeah, I mean, we’ve mostly been focused on value add opportunities and workforce housing. That’s where we were finding the most opportunity for us. It’s been a real struggle. Anyone who’s been working in workforce housing knows that that particular demographic hasn’t been performing like it did in the years prior. There’s a lot of economic woes and hardships that they’re experiencing, the rent growth.

isn’t always there. And there’s some uncertainty about it in the future. But that’s not the only demographic that needs housing in America. And we really opened our eyes to the senior living space. That’s a huge spectrum of where you want to be on the operational complexity. As we get older and we have children, we want to do the least, the least riskiest.

projects and require the least amount of complexity on the execution for our own peace of mind. Our investors kind of want that too, these risk-mitigated projects. So we started looking at independent active adult living, which is age restricted. It’s for 55 and better communities as we call them.

And The senior community, here’s a few fun facts. It’s the largest demographic in the United States. It’s the fastest growing.

and it’s also the most affluent. Seniors in America control 75% of household wealth today. And not only that, their housing needs aren’t being met. I mean, we’re actively because because they’re not being met, none exist. We have to develop these communities from ground up because they’re not existing, the demand is already there.

And then in Florida is a the one state that attracts more seniors than any other state in America. So there’s almost threefold of opportunities. There’s the location, there’s the supply-demand gap, and there’s that growth of the demographic and the movement into Florida. I think Florida attracts three times the amount of seniors, then the next highest state when it comes to senior migration and retirement migration. So that is that is.

just a fantastic opportunity is affluent retirees who want nice housing that just isn’t available to them. They like the safety, they like the security, and they like that staycation lifestyle. You know, they’re saying, like, we worked our whole entire lives, we have all this home equity. We want to kick off our shoes and relax and and enjoy some high amenity living. And we’re able to offer that for them. And pockets in Florida, where

we’re the only game in town. There is no A-class senior living options outside of memory care or assisted living, which is a which is a whole different play. We’re lifestyle, health, wellness, and community, but we’re not healthcare. So that that is something that’s attracted basically all of our attention. I get it, our investors get it. The the seniors are like, where are you guys?

How come there aren’t more places like The Villages and what’s the other one in in Florida? Margaritaville is another huge opportunity. But and and we’re able to offer 300 unit complexes that meet all of that demand and and more. So really, really excited about that. Returns are great and we’re able to risk mitigate a lot of these projects that give us the amount of peace of mind and comfort.

along with our investors as well.

Issa Hanna (18:40)
And I was gonna actually say that what a great way to, you know, identify a hole in the market and then target it, go after it, not just for you, but for Cashflow Capital. So people that are members of it and people that want to get involved in it. I mean, you’re over here. I mean, the money is just unlimited that you that you can make. So wow, that’s that’s amazing. Very smart, smart way to

to focus on on what the you know the supply and demand aspect of it. And another thing I was gonna make, the seniors of today are not the seniors of twenty, thirty years ago. They want the experience. They want to live the good lifestyle. They wanna have fun. They’re not sitting in their houses just rotting away, you know, they’re going to they’re going out with their friends. They’re they’re driving their golf carts around. So I’m I’m super excited and I’m excited that you’re doing it’s more for the seniors of our country because

They definitely need it. Now, five years from now, Ryan, where do you wanna see Cashflow Capital Club, your whole business?

Ryan Byrne (19:45)
Yeah,

that’s a it’s always an interesting question. I didn’t see myself here today five years ago. You know, five years ago, if you asked me what the goal was, it was like, Hey, I want to find a nice 10, 20 unit complex. We fast forward five years, we have 1200 units under management with 800 units under development. Yeah, it’s kind of we put one step in front in front of the other.

we we deal with each opportunity on a standalone basis to make sure it’s delivering attractive returns, taking the least amount of risk possible. Yeah, I I I I want to keep doing what we’re doing and cherry picking those opportunities, presenting them to our network and those people who want to join us and and and see where that takes us. I I’m not

I don’t have this vision board that has to get me to a certain number of units. And in my eyes and my wife’s eyes, we’re already there and we’re just sharing the opportunity and what we’re doing with more and more people. Right now we have 200 active investors that have joined us. It’s a, it’s a, you know, in some respects, it’s a small, tight-knit community. And we present those deals to to our network and we we get a handful of people that join us.

every every month and say, hey, where’s the next opportunity? So we like what we’re doing. We like the relationships that we have with our operating partners. We like the relationships that we have with our investors. And I think over the next five years, just keep strengthening those relationships. We we found exactly what we were looking for. And we we want to keep that going and keep that nice and nice and strong. We don’t want to put ourselves in too many areas focused on the things that we’re good at.

so that we can all grow and profit to together. I think that would be my my five year goal. Personally, I’ll continue providing opportunities for my family, my kids, making sure that they’re learning and and growing. And and just kind of share what we’re doing with more people so that they can experience the same benefits that that we are. I think that that gives me a lot of fulfillment, you know, personally and and spiritually and and

professionally.

Issa Hanna (22:11)
Definitely. And you know, it it does feel great to help people with your wealth of knowledge. You’re not just helping them with teaching them things, you’re actually making money for them. And the fact that your five year plan isn’t, I’m gonna aggressively scale, I’m gonna grow it, but I’m gonna make the right investments for my people. That shows that you care. So and then it was a perfect segue to my next question for people just starting out. They’re watching us or say, hey, you know.

I want to do what they’re doing. I want to be there one day. What advice do you have for them on growing their business relationships, growing their networks?

Ryan Byrne (22:48)
Yeah, great, great question. We can all expand our knowledge base, right? There’s books out there that you you should be picking up. I mean, *Real Estate Raw*, the red book, was a great starter book for me. But this space is more, way more than just knowledge and academics. You can spend a lifetime in academics and not get anywhere or do anything. It is about people, it’s about networking, it’s about sharing what your

trying to do and finding those people that are doing the things that you envision yourself doing. Whether that’s joining your local community, joining us at Cashflow Capital Club, getting to know us, other operators, it is, like I said, it’s a team sport. Start sharing your ambitions, your goals, and what you’re trying to do. Not with people who aren’t doing it.

but with people who are actively doing it, we’re not hard to reach. We’re happy to pick up the phone, have conversations, guide you in the right way. But I I would start doing that. Start start reaching out to people. Say, hey, I had this idea. What do you think? You have any advice for me? I I would that that was a game changer for me and my and my wife. We were passive investors, we were academically.

like powerhouses in the space of multifamily, but really didn’t get traction until we started putting teams together, having conversations on the phone, saying, Hey, we’re interested in this. What are you what are you working on? What are you doing? What do you need? And and starting starting there. So academics is good, but people are even better in my in my experience.

Issa Hanna (24:42)
Definitely you gotta get out there, you gotta, you know, put what you do out to the world. So that way, you know, if somebody’s thinking, hey, you know, I want to invest. Yeah, Ryan, you know, I mean could be a simple, hey, I do this, you know, and they’ll always remember it. So now, Ryan, if if people wanted to get involved with you and they and they wanted to network with you, how could they get a hold of you in Cashflow Capital?

Ryan Byrne (25:06)
Yeah, the you can go to our website, cashflowcapitalclub.com. That’s cashflowcapitalclub.com. There’s a request for an invitation to join link on there. Put in your information. If you mention this podcast and Investor Fuel, we’ll send you an A to Z walkthrough on one of our deals. Just make sure you mention.

this podcast and we’ll we’ll send over one of our past opportunities or next opportunities to you so you can start getting your feet wet and exposure to some of the things that we’re doing, how we do them, the business plan, the execution, how deals are structured, an overview of the underwriting, all of it. It’s a mini boot camp that we make available to our investor network free of charge, no commitment at all. So yeah, give us a visit over at cashflowcapitalclub.com.

Issa Hanna (26:01)
Make sure you guys check him out at cashflowcapitalclub.com because just the numbers that he’s gonna give you for free on one of these deals. You can break down, you can see what I’m talking about about Ryan being such a great mind in the real estate world. Because it, you know, the the deals he structures, the deals he makes are safe for his investors, and he cares about his investors. So make sure to check him out. Ryan, thank you so much for coming on the show. It was a

true honor to meet you, to talk to you, to pick your brain about all the knowledge you have in the game. So thank you so much.

Ryan Byrne (26:38)
Hey, thank thank you and thanks putting this information out there. I love what you’re doing for people.

Issa Hanna (26:44)
Thank you. And I super enjoy talking to you and to the viewers at home. If you guys enjoyed mine and Ryan’s conversation and want to see more just like it, make sure to hit like and subscribe. I talk to people every day that can bring us different knowledge on every aspect of the real estate industry. Until next time, the Real Estate Pros are out.