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Show Summary
In this conversation, Eric discusses the importance of preparation and education in real estate investing, emphasizing the need for effective communication and understanding client needs. He shares insights on overcoming obstacles faced by clients, the significance of building credibility, and the reasons behind his focus on the multifamily sector. Eric also highlights the role of communication and referrals in growing his business and expresses his commitment to being accessible and supportive to his clients.
Resources and Links from this show:
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- Investor Fuel Real Estate Mastermind
- Investor Machine Real Estate Lead Generation
- Mike on Facebook
- Mike on Instagram
- Mike on LinkedIn
- Eric Stewart’s Website
- Eric Stewart’s Website
- Eric Stewart on Facebook
- Eric Stewart on LinkedIn
- Eric Stewart’s Email Address: [email protected]
- Eric Stewart’s Phone Number: (321) 615-8919
Listen to the Audio Version of this Episode
Investor Fuel Show Transcript:
Eric (00:00)
The way I see it, you know, can, what do people need the most? They need a roof over their head and they need to eat. Well, I’m not going into the restaurant business, right? But in that business, you have to sell people. Come eat at my restaurant, breakfast. Come eat at my restaurant, lunch. Come eat at my restaurant for dinner. Three times a day, somebody’s selling somebody to come eat at a restaurant. What other business is it where you market to someone, that point of sale is once, and it costs them.thousands of dollars to leave your establishment. You’re providing a safe, clean, comfortable environment where they can come home to.
Michelle Kesil (02:10)
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, Eric Stewart, who has been making serious moves as a mortgage broker, helping investors scale and yeah, grow in the multifamily space. So excited to have you on the show today here, Eric.Eric (02:36)
Thanks Michelle, appreciate it.Michelle Kesil (02:37)
I think our listeners are really going to take something away from how you’re approaching helping these investors get ready and grow their businesses. So let’s dive in.Eric (02:49)
Sounds good.Michelle Kesil (02:51)
Awesome. First off, for those not yet familiar with you and your world, can you share what your main focus is these days?Eric (02:59)
Yeah, absolutely. ⁓ The main focus hasn’t changed over the last two decades. It’s built around the debt structure for commercial real estate. So I’m a mortgage broker. I’m not a one-shop lender where I don’t actually write the checks. I’ve got a stable of lenders that dochecks and do fund loans for everything from short-term, fast-closing bridge loans.
to long-term permanent debt like Fannie Mae, Freddie Mac, and conduit lenders. So that’s my space. I’m also an owner operator and started buying properties back in 2017. So my days are filled with funding loans for clients, helping them find the best debt structure possible, and also working on the front lines of my properties, asset managing, working with property managers, and…
looking at new opportunities coming in. So those two things fill my days and then obviously the education space is a big component where we’re looking to get out there and prepare clients, prepare borrowers for what they need to know to be effective and succeed in their portfolio growth.
Michelle Kesil (04:17)
Awesome. What have been some of the main keys that have allowed your business to be able to grow and to run smoothly?Eric (04:28)
Well, guess runningwe can talk about that, because that’s always a challenge to, you think it’s running smoothly, but who knows. I think one of the biggest things that has allowed my business to grow and really flourish over the last 20 years is my availability to my clients and my connection to my clients. That’s been the difference maker for me is considering myself a team member.
for my borrowers.
So client comes to me and they want to secure financing for a ⁓ multi-family acquisition. I have a list of questions that I’m going to go through with them that I have to sit back, listen and learn about their investment strategy before I can make any recommendations whatsoever. There’s been times where what they wanted was not at all aligned with what was one available in the market.
and two, what may have been in their best interest going forward. Because there’s more to it than just
out how to close this loan today. It’s what impact are the terms of that loan going to have on your overall investment later on? That’s a key conversation that we have in the beginning that sets them up for success as they go. And being able to have those conversations has been very, very impactful for my business.
and for my clients business.
Michelle Kesil (06:49)
Yeah, that’s really important. Can you expand on what that conversation looks like? Like what are some of the main questions and concerns that your clients have that you help them go over?Eric (07:01)
You know, one of the areas that I like to talk about that I don’t think is discussed enough is the risk tolerance that they are willing to take. You know, we’re dealing with human beings. Human beings have to sleep at night. We can’t run long term with looming stress hanging over us and sitting over our shoulders. So there’s a real good chance that maybe a non-recourse loan is the only thing they want, you know, where there’s no personal guarantees involved. Maybe they don’t want to have a short-term maturity on that.Maybe that loan, they want that loan to maybe have a fixed rate period and then the interest rate will start to adjust in five years or three years, but they want the security of that fixed rate right now. ⁓ Maybe they need more funds in the beginning, a higher loan amount in the beginning, and they’re willing to accept maybe a more expensive prepayment penalty down the road. All those little characteristics are what we need to talk through.
and help define that loan structure so it’s right for them today and it’s right for them in five years when they’re going to exit that.
Michelle Kesil (08:12)
Yeah, absolutely. What are some ways that people can prepare and understand what would be like the best long-term solution for them?Eric (08:25)
Well, it’s looking at their overall projections. So the projection is gonna come into play where they look at the asset now that they’re buying. They look at what improvements can be made to that asset, what they might need to fix, what they can’t fix, and then what they’re planning on doing with both the income side of the project, where they’re gonna find the other income, how are they gonna raise rents, how are they gonna be more competitive in the market. It costs money to position or reposition.that property in the marketplace. So where your dollars are gonna be spent, is that market going to absorb granite countertops? There’s a lot of properties out there that you may over renovate. You’re never gonna be able to get the benefit of putting granite countertops in. You’re never gonna be able to get the benefit of putting a tech package in or something like that. So digging down to that minutia can be very, very helpful for an investor to have it. It’s helpful for an investor to have a sounding board.
Right? Not just somebody that either buys into it or says no right away and then goes away, but maybe somebody that just is a sounding board that walks through the feasibility of what their lift is. And to me, that’s been one of the most valuable discussions that we’ve had is, hey, you know, we’re planning on implementing reserved parking and it’s going to be $15 a month per parking space. And
The discussion is one, are you gonna have electric and what the cost is? Two, have you surveyed the tenants to see if they’re going to buy it? They might not want that.
And it can be a very heavy expense that you invest in. If you don’t survey your clients, your tenants first, that may fall in its face. If your Lyft is based on all other income, let’s say you’re buying a property that’s at market rate already on rents, but you’re gonna implement a billback system.
you’re going to implement reserve parking, trash valet, all those unique little artsy other income lifts, and that’s your only value as strategy, that can pose a definitive risk and a lot of investors may not want to jump in with you on that deal. Those conversations are absolutely priceless and the timing of those conversations needs to be before, number one, before you buy it, but number two, before you put earnest money up and it becomes non-refundable. And then you’re in the deal and you find out that
your investors are uncovering this stuff and you can’t raise the capital. Or even worse, you actually close on the deal and you don’t execute. That’s what we’re trying to get vetted out in the beginning. from a lender standpoint, the lenders don’t want to know all these things. They’re gonna want to understand how this is gonna happen because they have to protect their exit. They have to know that you’re gonna be able to refinance or sell this asset and pay them back. So that’s why those conversations are so important in the beginning.
Michelle Kesil (11:57)
Yeah, definitely. Those are really important conversations to have.Eric (12:04)
Yes, ma’am.Michelle Kesil (12:05)
So what are you most focusing on solving or scaling to next in your business?Eric (12:14)
Well, for me, and I’m glad you asked, because I’m really leaning into the education space. I’m leaning into being more active on your standard channels, whether it’s putting out short little reels to give people something to think about for the day to help direct their business, or maybe even doing YouTube channels where I’m out short clips on points like…talking through your value add or what type of loan is right for you if you’re doing this type of deal. Just getting out there more and getting in front, being more visible so that people know that they can contact me. I’m available, I’m a human being. I really try to stay as available as I can. I’ve told clients this for a long time when they talk about scheduling a call or they always say,
You’re very busy, don’t want to burn up your time. Well, I appreciate that, but the reality is, I’m busy talking to clients, doing exactly what we’re doing at the time we have that conversation. That’s the most productive, busy I can be. And the worst sound any business owner or entrepreneur can hear is silence. So I am blessed that my phone rings, I’m blessed that people call me and ask for my advice.
And I don’t take that lightly, I don’t take it for granted. being available, ⁓ being accessible, providing clarity, ⁓ allowing them to be able to talk to me, hear themselves say things, and then just be a sounding board for them. ⁓ I think that’s really where I want to scale and grow and do more of.
Michelle Kesil (13:56)
Yeah, amazing. I think that’s so important to help people get on the right track that way.What are some of the common obstacles that you see with your clients and how do you help them overcome them?
Eric (14:11)
A big obstacle is that there’s a lot of common ones, but a large one is…establishing credibility with brokers, with industry professionals early on when they don’t necessarily believe in themselves. And if you don’t believe in yourself, then nobody’s going to believe in you. I say nobody. There are people that can see down the path and pull your transferable skills out and understand what your value points are, and they believe in you. I try to be one of those people.
I try to be one of those people that can help you find your transferable skill, your value that you bring to this team. And everybody has it. Everybody has it when they sat there
they decided at one day, whether it was a Saturday afternoon when they bought into an educational course or a program, or if it was when they were just sick of having their current portfolio, whether it’s made up of small multifamily and they want to go bigger.
whether it’s made up of single family and they want to go to multi, whether it’s, ⁓ you know, assisted living facilities and they want to buy something that’s a little more streamlined, whatever that transition is, there’s always a lack of confidence that they have in understanding this avenue that they’re taking. And for them to be able to highlight their transferable skills and their value points that they’ve
that they’ve utilized for so many years, whatever it is, if it’s communication, if it’s travel, if it’s just background history on an industry, and then find that confidence point and leverage that going forward is what I encourage them to do. That’s what I did. That’s how, in 17, when I started to buy property, I was able to offer value to my team members because I understand what the debt structure was gonna look like. I understood what the.
projections were gonna look like and the communication factor of just being able to speak the language was incredibly valuable to everybody and I say everybody, to my team members and that’s what allowed me to grow. So when I talk to clients, I try to get them through that because it seems like a huge hurdle. They were excited at one point. They were excited, they believed in themselves. ⁓ That can wait after a while, you know, when the weekend’s over and you’re
You get back to your home airport, you start your car, and the keys sound the same, and you open the door on Sunday afternoon, you’re like, that was a great weekend, but I have to go to work tomorrow. And then it all kind of goes away. And my hope is to reignite that confidence they had when they said yes to moving into the industry, and keep that, allow them to maintain it, and foster it, and really tend to that flame.
Michelle Kesil (17:52)
Yeah, I love that. That’s a really important thing for people to tap into that belief and that excitement and yeah coming back to that as their center.Eric (18:01)
100%. Yes, ma’am.Michelle Kesil (18:05)
So I know that multifamily is your wheelhouse. Why specifically did you choose that route?Eric (18:12)
Great question, great question. I would like to say it was some ⁓ genius move on my part early on that where I said this is the industry that is ⁓ where I’m going to focus. It was more reactionary than anything else. Back in 2004, ⁓there was another commercial mortgage brokerage firm in the same office building where my office was. And the owner of that firm and I, we talked every once in while, see each other in the elevator. He was moving out of the industry and he referred a couple clients to me that were, they were buying multi-family properties and they were newer investors. And he entrusted me with those clients and it was…
It was actually, was a big moment for me
because he said, he asked me, you know why I’m doing this? You know, and I’m thinking, okay, he’s got these other opportunities. I thought it was something drawing him away and maybe it was convenience. I really didn’t know. He said, you know why I’m doing this with you? Because I trust you. And that hit, you know, that really meant a lot because it’s not something that I ever really thought of. It’s just how you do business, but.
being trustworthy is what connected me with him, what connected me with those clients.
And that allowed them to introduce me to other folks in the industry that really, really changed my business trajectory. They introduced me to people like, and companies like Ari Mentor, and a lot of other educators out there that spawned from that where I got to meet people that were moving into the industry and learning and growing. that is, that’s a big, big.
driver for me is to have that client avatar.
That’s where the requests were coming, right? So when you’re focused on that collective group or a group that’s coming in wanting to learn multifamily, you serve what the orders are. And again, I’d like to say that it was this genius move where I said, I’m multifamily and I’m gonna work on Fannie and Freddie loans and bridge loans and so forth. The reality is that’s what people
asking for, so that’s what I served. Kept my nose to the grindstone, it was the best that I could be where I was.
and that was in the multifamily space for, well, 20 some odd years now. ⁓ My lenders can fund all different types of asset and I do them. I do one-off deals for self storage or assisted living facilities or something like that. Definitely handle those, but the bulk of the business is multifamily. And then from a portfolio standpoint of what I’m buying, it’s always been multifamily. ⁓
The way I see it, you know, can, what do people need the most? They need a roof over their head and they need to eat. Well, I’m not going into the restaurant business, right? But in that business, you have to sell people. Come eat at my restaurant, breakfast. Come eat at my restaurant, lunch. Come eat at my restaurant for dinner. Three times a day, somebody’s selling somebody to come eat at a restaurant. What other business is it where you market to someone, that point of sale is once, and it costs them.
thousands of dollars to leave your establishment. You’re providing a safe, clean, comfortable environment where they can come home to.
And for them to leave, they have to pay thousands of dollars somewhere else, whether a down payment on a house or first, last, and security at another property. What did you do that they want to spend thousands of dollars to leave you? That’s a great business. That’s where I’d like to be. So that’s my rationalization. The reality is,
I was just doing a funding loan request that came in and they were multi-family. So that’s why I’m still here.
Michelle Kesil (22:20)
I love that. Sounds like that was the right path for you.Eric (22:25)
Looking back, was definitely a positive.Michelle Kesil (22:30)
Awesome. When it comes to growing your business, what has made the biggest difference for you?Eric (22:37)
Hmm. Communication. Communication and referrals. That has been, that’s been the biggest driver for me. It wasn’t some marketing light switch that I turned on, which is down the road. I know I hear all the advisors, all my friends yelling at me about getting out there and getting on social media and marketing more. ⁓ But.The biggest impact that I’ve had has been on those one-on-one conversations with people and the communication.
Michelle Kesil (23:11)
Absolutely, that makes the biggest difference. So before we wrap up here, if someone wants to reach out to you, connect and learn more, where can people find you and reach you?Eric (23:24)
Well, obviously LinkedIna great way to connect with me. think all of my social channels are gonna be in the link on the podcast, because I know we submitted those. I don’t know if a phone number is in order, if that’s too old fashioned for everybody, but my phone number is certainly, know, to give me a ring there, email address. AtlanticIC.com is my website.
LenderLanguage.com is my educational platform. You can reach me at either one of those. you know, fashion phone call is, it never hurts either. So, any one of those. Try to make myself as available as possible.
Michelle Kesil (24:08)
Amazing. Well, I appreciate your time, your story, and your perspective. Thank you so much for being here.Eric (24:16)
Thanks for having me, Michelle. I really appreciate it.Michelle Kesil (24:18)
Of course, and for the listeners tuning into the show, if you got value, make sure you’ve subscribed. We’ve got more conversations with operators like Eric who are building real businesses, and we’ll see you on our next episode. -
