Podcast Episode 145 Transcript

Episode 145: Choosing A Lifestyle By Design Through Multifamily Investment with Yosef Lee

this week on the pre-real podcast we
have Yosef Lee amazing story immigrant
who came to the country at the age of
17.
built up a great practice he became a
successful litigation attorney but was
trading time for money and felt that the
American dream had more than even this
dream that he was already living and had
built relatively quickly
through Robert Kiyosaki and Rich Dad
Poor Dad of course Victor pockets of
course he had that moment where he had
decided he no longer wanted to trade
time for money and from 2020 to 2022

Yosef Lee has acquired over 1100 units
in the multi-family space as both JV and
syndicator Yosef Lee this week it's a
great show wonderful guy out there
crushing it shares a lot of tips and
inside information on how he built the
plan to get the deals done don't miss it
Yosef Lee this week's pre-real podcast
are you ready to bring your real estate
game to the next level my name is James
prendamano I'm the CEO and founder of
free
25 years I've closed over a billion
dollars in transactional real estate
each week a meeting with outstanding
investors High performing individuals
and Visionaries operating in the real
estate space these are the people that
are actually out there in the real
estate game right now getting it done
this podcast aims at bringing anyone's
game to the next level
this is the pre-real podcast welcome
everyone to the pre-real podcast we're
joined today by Yosef Lee Yosef has a a
fascinating story in at least as I've
perceived it
Yosef is a
self-described strategic planner action
taker entrepreneur wannabe he has a
litigation background as an attorney an
Avid real estate investor and folks the
reason I I wanted to have Yosef on and
I want the folks to pay close attention
to Today's Show uh so we're gonna we're
gonna lead with the punchline in the
last two years essentially Yosef has
gone from zero
to 1100 units
as a GP
that to me is absolutely remarkable so
Yosef thank you so much for taking the
time and joining us today
thank you very much James for having me
I'm very excited
um to be on this show and know uh this
is very renowned um very well known real
estate podcast show so I'm very happy to
be here just walk the folks through your
journey up until the point that you
started to invest
sure sure so um as you said I'm a son of
well not son of an immigrant I'm
immigrant myself so I came here when I
was uh 17 almost like a couple of months
shy of being 18 years old so as soon as
I came here in the U.S everything was
like
a shock right culture shock and I had no
friends so I had to make new friends new
language and everything so every day
ever since I came my life has been all
about
proving myself in a new country right
trying to get better version of myself
every day as much as possible
I think I achieved some goals but also
you know had many mistakes but you know
I learned the lessons and moved on so
uh uh fast forward I became an attorney
after graduating uh School worked for
years and I became an attorney looking
to become a a you know professional
making some monies living a good life
and uh doing this for a couple years I
started realizing that by nature of my
job I am trading my time for money
and I always started thinking like is
that the the job that I want to live for
the rest of my life right the way that
it works okay you're making some monies
but it's what what next right so I
started looking to you know the options
and where I could sort of take the
control of my time back and I started uh
just doing some research myself and
that's around when I stumble upon the
book uh reached it and deported by
Robert Kiyosaki it's the blue uh the
purple Bible right
and that book just changed my mind
upside down like wow this is so simple
yet so powerful no one really taught me
about this so that's when I started
looking into uh some creating some
passive income streams and didn't know
much about it so I tried a little bit of
wheat I read and I studied a little bit
trying a little bit of mutual funds and
starts when not
and I stumbled upon a real estate
and as I delved into more uh into it I
stumbled upon something called
multifamil and the benefits that
multi-family investing offers was just
no brainer not to take so throughout
2019 I started doing self-education by
going to biggerpockets.com
and then I started listening to the
podcast like people like Michael blanks
and Grant Cardone those are the first
two people I listened to
and you know I started dreaming about
being a real estate investor a
multi-family real estate investor and
the the fact that I'm from New York
uh got me into a limiting beliefs like
oh like how can I find a big
multi-family is it and then as an
individual not as an
institutional level
and become an an owner of a building
like that and uh okay let's see if I
could start finding something not in New
York but maybe somewhere else New Jersey
and Connecticut I started looking into
other states but still expensive
still uh you know
it's it's not uh just something that I
could I thought I could because I'm not
gonna be there uh whole time to look
after the property so these are all uh
the limiting beliefs that I had in the
beginning but through uh proper
education through meeting uh through
networking with right people and making
a right partnership I was able to uh
Crush that limiting beliefs and and fast
forward starting from uh February uh
2020 I joined a mentorship group two of
them one is mih Mastermind the other one
is Jake and Gino uh multi-family
investor group and I met all my partners
there did the right education
and then um yeah I ended up doing my
very first deal in December 2020. that
was the 44 unit
multi-family in Kansas with six of us as
a joint venture deal what were the
motivating factors that that said okay
you know so if it's time to to do this
well as scary as it was at the same time
it was very fascinating because look I'm
in a new place this this is this is the
land called lend that opportunity
so and I was young
I thought I thought I could make huge
something huge in this new country and
impact so that was my driving Factor
every day like I said being a better
version of myself every day like okay no
matter what it is let's let's try to
learn something new and try to find the
goals trying to find the visions and see
if I could
um you know make something happen here
in this new country that was a very
initial driving factors before I got
married and having kids
there's an awful lot that goes into
these syndications as a GP as an LP is a
different story but as a GP there's a
heck of a learning curve there can you
talk a little bit about or a lot about
some specific things the level of
intentionality that was required for you
to execute this plan education wise I
knew
I wouldn't know what I would what I
didn't know at the time if I don't you
know actively search for the for for uh
better education right I know there were
a lot of stuff I was listening to for
free podcasts and you know YouTube
videos and all that but I as I was doing
it for a couple of months I started
realizing that I was not really taking
any actions I thought I was taking
actions I thought because I was reading
I was actually searching the contents
through YouTube and I was listening I
consider that at the time to be an
action oh so I'm doing a lot
but if you really think about it it's
not really an action you're just
passively observing the information
that's out there so you need to do more
than that so my um
my uh so I ended up determining okay I
gotta join a mastermind or some sort of
mentorship group to to you know get
better education and also have that
exclusive Network because I was able to
see as I was doing some education you
know people do deals people say okay
let's do deals someday you meet somebody
on biggerpockets.com and you always say
hey nice to meet you we'll do we'll do a
deal someday but do you really do the
deal that way maybe you could you can
but to me seemingly the deals are being
closed by people who are within that
close proximity I I noticed some people
they do the deal together because
they're in press some rock group they're
doing deal together because they're on
their uh Michael blanks group so I'm
like huh maybe I should join one of the
one of the groups out there to expedite
my my game right so I've added couple I
ended up joining uh Jake and Gino
because their story kind of resonated
with me they're from New York Pizza
restaurant owner and uh you know the
pharmaceutical representative of a
company and they left New York and built
the Empire so that story online just
resonated with me so I said you know
what I'll I'm enjoying that group so I
joined
so education started oh and another
thing this is probably another mindset
um if you're uh in the on the fence of
deciding whether to join a mastermind or
a mentorship group or not I'll tell you
about how my mindset changed so I was
asking a lot of questions to a lot of
people that I met on biggerpockets.com
eighty percent of people told me look
you also I understand that you want to
join a group but let me tell you
whatever that you're going to be
learning from uh these groups you can
learn for free from YouTube uh or or
podcast listen podcast or just by
reading some books
um why don't you just spare that money
and actually use that money to do your
own deals and learn from there I'm like
huh this guy's at the point right okay
that's a good point and I was talking to
this address 20 of people
and they were like yo Seth you gotta
join this must join you're gonna meet a
lot of people amazing people you're
going to be partnering with them you're
going to be within their exclusive
Network
I'm like huh okay
so this guy has a point as well so I was
thinking and and uh you know just just
giving a lot of thought because it's not
you know cheap program right it's a
couple uh you know twenty thirty
thousand dollars
at that time still I'm like okay let's
think so I considered all all the
factors out there and decided to join
based on the two reasons one
by then I had already decided to become
a multi-family investor not single
family duplex right so saving twenty
thirty thousand dollars although it's a
it's a big money it's a it's a lot of
body I uh thought that it wouldn't do
much at any at all right because we're
talking about millions and millions
dollars of multi-family investing like
saving 20 30 grand or what are you gonna
do with that right so that was uh how I
thought about that and secondly
all the multi-family deals are to me it
looks like actively being closed by
these people from 20 Improvement as
opposed to this 80 percent of people
someone you know what I'll listen to
that guys and sports disguise because
they're they're producing the results
so I joined so if I mean it's a simple
reason but if you're on the fence of
deciding it just think about it the the
language first of all is different
they're saying oh you're gonna be
learning that for free you know that's
just uh free contents out there and uh
you could start small things like that
but against that these group people were
saying you're going to meet amazing
Partners you're going to meet amazing
people the network
so I loved the fact that they were
putting the people first as opposed to
free contents because yes it's true
education is education and you will
probably even if you join you probably
think that oh this is stuff that I could
also you know get free from from YouTube
but it's not just only that it's the
network that comes with it
and also the support that you're gonna
get because
this is a long-term Journey you're not
going to be just doing one deal and done
right you're going to be doing multiple
deals and this is not a flipping or
wholesaling where you could probably do
one or more deals per month and yourself
no this is we're talking about at least
20 30 40 units to 100 units apartment
where you will never be able to do it
alone
so you need that support
I didn't have that support from my
friends so no one understood this
multi-family syndication concept among
my friends so I was kind of lonely at
the time because like they were like are
you sure this is like legit business
model you sure this is not a scam I'm
like you know I believe in it but they
just they just didn't know right they
didn't have any proof of content so
so
in other words you have that support
from these groups they all understand
what you're trying to achieve what you
need and what what you're missing as
puzzles right so I joined as soon as I
joined I started networking crazy
uh and luckily as it was a dis the
pandemic was disguised a blessing for me
I joined these groups in February of
2020 right right after that pandemic
came and shut down everything I was so
eagering to go out and meet rules at
people but I couldn't because I was not
allowed to go out but you know what I
found out about Zoom I didn't know about
Zoom before
but after pandemic I learned about zoom
and I learned that people started taking
this uh Zoom call more seriously and
before
right before who would think that would
do a business over Zoom right but but
the pandemic made a game changer uh
effector into into this whole like you
know uh video conferencing so I I
started doing a lot of networking calls
and I had a lot of time back then
because I didn't have to work for a good
six months I had no work so all I did
was educating myself a real estate
secondly doing a lot of networking calls
like this one-on-one calls I I counted
and stopped around 200 calls in 2020. so
literally I did more than 200 calls in
2020 from early to to the late 2020
looking for partners I met all my
partners through that group that and MIT
Mastermind and then uh yeah out of that
we did deals together until today so uh
you've done your homework you're in your
groups your first deal uh let's talk a
bit about that your first deal was in
Kansas you closed it in December of
2020. how did you find that deal
so this deal uh came to us through one
of our partners who knew so one of our
partners my both underground partner who
lives in Kansas his friend knew the
seller the seller was I think Ben wanted
to go bigger so he wanted to get rid of
the property he's been I think owning
that property for decades so no no uh no
debt uh it's it was just owning it for
free debt free
um he wanted to get rid of it and go
bigger or else he wanted to retire
something like that it's either one of
the reasons
um and uh you know because he knew the
friend of one of my partners and we were
able to just offer without competing
with any other parties they they liked
our teams and um the seller said uh you
know what I want to sell this property
to you uh one condition is that you need
to close within uh year 2020. that was I
think around September so we said yes we
love to close winning 2020s so yeah
that's how the deal came to us through
uh it's almost so through Network then
right the bottom line is networking we
knew the person who knew the seller and
he came to us so that that's one of the
biggest questions and places where
people get stuck how am I going to find
the deals and and if we're from the big
markets La New York Chicago Miami where
it's incredibly expensive to penetrate
uh your Market uh this is how you do it
so the sourcing was was handled by a
partner now who put the cap stack
together for the deal
so this first deal was joint venture six
of us so we had to raise so the deal
um the the purchase price was one point
I believe 1.75-ish
right and it was 44 units
um so imagine 44 units 1.75 New York no

way not even not maybe three units right
yeah maybe but but yeah this this
property is is in a C-Class area
Workforce housing uh well I'll say c
plus not like D area but it's still nice
C plus area the seller was owning it for
debt free so he didn't bother pushing
the rents for decades he he was okay
with just getting a cash flow right so
there was huge upside for the property
um
it was 1.75 million but we knew there
was huge uh upside to raise value
so we bought it 1.75 and we had to raise
I believe 650 000 so 600 650 000 so it
was taken care by Among Us uh the six
people
so uh another interesting limiting
belief and and thing that you hear uh if
the landlord could get more money for
the apartments they would be getting it
not true everybody's circumstances
different and uh you find in these deals
that there is so much opportunity that
often is just not realized because of
Life circumstance uh timing a number of
different factors right so uh lost to
lease to the tune of 150 200 an
apartment has a significant impact when
you're talking about 44 units right
across the board you're talking about
raising your cash flow by a good margin
here
um yes yes totally and and just to piggy
about it upon what you just said
by by now doing you know some deals by
now I realized what the the ideal buyer
the sellers are looking for is not the
one who offers the the highest amount of
money but someone who can close for sure
so your deal is pulled together you guys
Source the capital yourself you go out
to the markets you secure debt uh you
close by that deadline
what about management now what
okay now so we had we inherited the
management company that the prior seller
had and we liked them so we kept them
and then the management company knew all
the tenants already so we had a rather a
smooth transition in the beginning and
then we were getting on a call weekly
basis with them to make sure our
business uh our business plans are being
executed and if there has been any
problems with delinquencies and all that
so but in the beginning
um I believe more than 50 percent of the
tenants were month to month
right so we had a set of uh business
plan of replacing the month-to-month
tenants into uh long-term lease tenants
and by getting a new lease and all that
and oh yeah but back to your question
management wise it was pretty smooth in
the beginning uh another another point I
want to make is when it comes to Big
multi-family
the management company is is a little
different than a residential uh you know
one families duplex house management
company right they know how to manage
multiple tenants at once Under One Roof
so and then and then they're more
professional level
right so
as as an owner of the multi-family
building we don't really get involved in
day-to-day operations it was it's done
by the property management company that
we hire right we just set the vision and
goals and business plans and make sure
they follow and that's being executed so
from that point you have now added
another
1053 units plus or minus 1057 units plus
or minus
um talk just uh for a few minutes on
what that scale has looked like have you
formed multiple groups is it still the
same Core Group what's happened in that
evolution
so after that first deal following that
March of 2022
uh March of 2021 I'm sorry we uh did our
second deal uh 68 units indications with
the same group that's the same Core
Group having additional secondary
partners
so this group uh this core group did
first JV and three months later we did
first uh syndication deal
right so we experienced but I was
fortunate enough to have experienced
both
and then thereafter one of my mentors
got me a uh a job offer he offered me a
part-time position in his real estate
company
so I joined his team he was like I know
you're working full-time as an attorney
I don't care whether you work at night
or weekends as long as you get the job
done would you like to join I'd love to
I said of course so I joined and with
him I started learning as the uh you
know how to raise capitals and also I
looked after his companies and uh
creating operating agreements and all
that like some legal stuff right so
that's how I started adding value to his
company so with him uh he joined with
another group uh it's a sharp line
Equity a great syndication operator out
there so uh we as a team so I have so I
have mainly two teams that I work with
one sharp line for apartment syndication
and my core team was still due uh and
more focusing on JV structure deals
right so with the syndication as I go in
as a partner of the group I also got a
code GP share from all the deals that
sharpline closed in 2021 and 2022 just
briefly saying after that first
syndication as a core girl of 68 unit in
in uh April with it 30 uh 64 unit May 36
June 72 and then uh August under 31

September 150 units in 2021 alone 2022
with the 70 in January 74 and 70 72 and
76 in April 108 1 15 June and 98 August

like you know like it's all mixed in my
head but that's that's about how like
Fast the the group was moving
it's indicating all the deals raising
all the capitals in a day or two
and um but again
that's a syndication I love syndication
because JV you you need many times you
need your own Capital to be a JV deal
and people will not accept you if you're
just coming in unless that's very
specific value you're adding something
like finding the deal self right
um and I only have so much money I can't
really do JV all the time so uh
syndication is a good way to earn fee
because to me syndication is truly using
other people's money and make a fee out
of that and then I love to roll that
money into a JV deals because I also see
different value from JV deals
um so I love to do both to me
syndication
uh and JV together
you mentioned about truly truly uh
trading no no truly taking the time back
is that what you meant or Freedom time
you definitely mentioned about it
yes and no some people think that being
an active investor is it's a great thing
but
to me I learned
being an active investor yes you can
leverage other people's money and other
people's time you will get some time
back but still it's active at the same
time you're being inactive I want you to
become a passive investor as well you
need to as as you make money save money
you need to put that money to work for
you otherwise you're always just still
work so I I love to do both
that's my business plan I make money
from syndication and JV either cash out
refi whatever and fees I roll that into
a passive investing side either in my
own deal uh usually but I also invest in
someone else's deal as well
so that at one point something got
forbid something happens I stopped being
an active investor still have something
coming in please tell the audience what
is the best way for folks to find you
uh I very I try to be very active on
social media so I'm on Facebook uh
LinkedIn insta and I started doing some
tiktoks
so it's it's funny that's a whole whole
lot of different different social media
platform there but I I started anyway so
that I could I could also get some value
out of it
up tomorrow Yosef they are I I mean
it's been a yeah right but it you know
people start to follow and catch on and
there are some young folks that are
really interested in this and and you
start building the network and you
become a brand and an entity and I
applaud you for it I think it's great
yes right right thank you and also this
there's only one handle for that Yosef
you're procef so why osc have y o u r b
r o s e f and yeah and send me the DMS
I'd love to get on the call and share my
experience and share my tips and all
that
uh Yosef I really appreciate it as
always folks all the links all the
information will be down below
congratulations on an amazing amazing
jumpstart to the career uh we're not too
far apart here in New York maybe one day
we'll get together and we'll get into a
deal you know on our own for sure I love
to I'll love to grab something and uh or
eat dinner with you someday we'll do
that we'll definitely look you up Yosef
Lee everybody I appreciate the time as
always folks please stay safe