{"id":9199,"date":"2023-09-14T09:53:40","date_gmt":"2023-09-14T09:53:40","guid":{"rendered":"https:\/\/imsfund.com\/?p=9199"},"modified":"2023-09-14T09:53:40","modified_gmt":"2023-09-14T09:53:40","slug":"from-16-year-old-skater-to-investing-in-cash-machine","status":"publish","type":"post","link":"https:\/\/imsfund.com\/index.php\/2023\/09\/14\/from-16-year-old-skater-to-investing-in-cash-machine\/","title":{"rendered":"From 16-Year-Old Skater to Investing in \u201cCash Machine\u201d"},"content":{"rendered":"


\n<\/p>\n

Cash flow<\/strong><\/a> \u201cmachines\u201d <\/strong>is how Mikey Taylor<\/strong> describes his most recent investments. To the non-investors, the numbers seem too good to be true<\/strong>. But Mikey has repeated this system, again and again, to make millions<\/strong><\/a> of dollars off of \u201cboring\u201d investments<\/strong> that most investors overlook. What \u201ccash machines\u201d is Mikey referring to, and how do you go from making $800\/month to millions of dollars<\/strong> like he did?<\/p>\n

Mikey has no degree, full-time job, or wealthy parents<\/strong> to hand him an inheritance. At sixteen, Mikey made it his mission to find sponsors for his skateboarding career. What started as a hobby grew into a profession, but Mikey knew it wouldn\u2019t last. After searching for some other income to support him<\/strong> when his career finally ended, Mikey conveniently stumbled upon real estate\u2014and the rest is history.<\/p>\n

Since ending his skateboarding career, Mikey has built a brewery, invested in multiple BIG multifamily deals, and started buying the \u201ccash machine\u201d properties<\/strong> so many investors WISH they could get their hands on. If you want to know the strategy behind these bold moves and how you can go from barely scraping by to financial mastery<\/strong>, like Mikey, this is THE episode to watch.<\/p>\n

\n

David:
This is the BiggerPockets Podcast show 818.<\/p>\n

Mikey:
First question we ask is, do we want to own this thing for the next 10 years, and is there demand to own this thing for the next 10 years? But a lot of times we go, \u201cOh, my gosh. I\u2019m going to buy it now. And what are interest rates and cap rates going to do in four years?\u201d And it doesn\u2019t matter. As long as there\u2019s nothing to force a sale in your time horizon, if you have the demand, it\u2019s staying off, but you\u2019re cash flowing, who cares?<\/p>\n

David:
What\u2019s going on, everyone? This is David Greene, your host of the BiggerPockets podcast here today with my co-host and frequent flyer on the podcast, the handsome Rob Abasolo. We\u2019ve got a banger for you, as Rob would say. It\u2019s slays. It\u2019s fire. What\u2019s all the other stuff that you\u2019re always trying to sound cool saying?<\/p>\n

Rob:
It slaps.<\/p>\n

David:
Yes, that\u2019s it. Today\u2019s show slaps with Mikey Taylor, a former professional pro skateboarder and friend of Rob Dyrdek, who we\u2019ve also interviewed on the podcast. And Mikey shares a lot. He talks about how he became a pro skateboarder, how he got into real estate investing, how he met with the financial advisor to talk about what he should be doing with his money, how he initially invested in self-storage, then started buying self-storage, then started buying apartment complex, then got a fund, then built a debt fund, built a brewery and sold it. I mean, Rob, this thing was chockfull of good stuff. What should people be listening for to help them in their own journey?<\/p>\n

Rob:
Well, what I really liked about this one is that I thought there were a lot of practical elements to what he had to say. He wanted to quit his job, or he didn\u2019t even want to go to college, and wanted to do the skateboarding thing, and his parents said, \u201cNo, you need to understand finances and you need to build a budget,\u201d and they made him go to a financial advisor that told him that he needed to start investing in real estate passively.
And he kind of developed that bug of just he got his first distribution, talked about how that was just very addictive for him to just continually do that, how that unlocked in his brain that when everything else goes away in the skateboarding world, he can always depend on real estate, and he just used that to kind of build more and more momentum to now his crazy story, how much money he\u2019s raised, how much money he\u2019s deployed in the multifamily space, the self-storage space. Honestly, just crazy story all around, and I think the craziest story was at the very end, the one he tells us about Rob Dyrdek. So if you want to hear that, stick around until the very end.<\/p>\n

David:
This guy has lived about six lifetimes and had six careers in one life, and we\u2019ve got it all condensed and compacted into an episode for your viewing pleasure. Make sure you listen all the way to the end to get Mikey\u2019s four key takeaways that he\u2019s learned from life that are pretty much guaranteed to help you be more successful. Now, you may be noticing that our background looks a little different, that\u2019s because Rob and I are here in downtown Los Angeles at the Spotify studios recording for your viewing pleasure. Before we get to Mikey, today\u2019s quick tip is start with the end in mind. If you raise money, you need to know how to pay back your investor. This can be for a business or a larger real estate deal, but always start with the end in mind. Rob, anything you want to say before we get to Mikey?<\/p>\n

Rob:
No, Davey. Let\u2019s hit it.<\/p>\n

David:
Mikey Taylor, welcome to the BiggerPockets podcast. For those that are unfamiliar with Mikey, he was a pro skater straight out of high school with a 14-year career who retired at 34 years old from skateboarding, created and sold a microbrewery while still skating, started and runs Commune Capital, which has debt and equity funds. He owns commercial real estate in self-storage facilities in eight states and is a multifamily investor in California. And as a fun fact, he was recently elected to the city council in Thousand Oaks, California.<\/p>\n

Rob:
You almost had 1000 Oaks, California.<\/p>\n

David:
Yes, I did. I almost did, but I\u2019m not from Southern California, but I caught myself with the last minute.<\/p>\n

Mikey:
That was good.<\/p>\n

Rob:
You did say the PCH earlier.<\/p>\n

David:
You absolutely caught what I started to do. Okay, let me ask you a question while we\u2019re on this topic. Rob said it\u2019s not called the PCH, but everything else you guys state on here is The something. It\u2019s The 405, The 205, The Five. In Northern California, we just say I-5 or Highway 99, but you guys have the. But when it comes to PCH, it\u2019s not the PCH. What? Is there rules to this lawless area?<\/p>\n

Mikey:
That\u2019s one of the rules that it\u2019s a locals-only type of vibe. If you know, you know, and if you don\u2019t, then we know you\u2019re an outsider.<\/p>\n

David:
You make it complicated so guys like me stand out and you know that I\u2019m not in the in club.<\/p>\n

Mikey:
Exactly right.<\/p>\n

Rob:
I think you would really love 1000 Oaks in California. It\u2019s a really nice place.<\/p>\n

Mikey:
Oh, I didn\u2019t even know why he said that. You picked up on it. Okay. Yeah-<\/p>\n

David:
He just thought I don\u2019t know how to talk. I\u2019m reading right off the script here, and Eric could have just put the word thousand, but instead he put 1-0-0-0, which most people read and then it\u2019s like that\u2019s a thousand, and then Oaks is on another line below, so my eyes didn\u2019t get that far. As soon as I saw the Oaks, I was like, \u201cWait a minute. That doesn\u2019t sound right at all.\u201d<\/p>\n

Rob:
Mikey Taylor, welcome to the podcast.<\/p>\n

Mikey:
Thanks for having me.<\/p>\n

Rob:
How are you doing?<\/p>\n

Mikey:
Good.<\/p>\n

Rob:
Is there ever a moment where you become Michael Taylor or is Mikey here to stay?<\/p>\n

Mikey:
You know what, I felt like running for city council was that defining moment and all the strategists and campaign managers were like, \u201cHey, Mikey sounds like a young kid. I think it\u2019s time,\u201d and my whole thing was like, \u201cLook, this is what I am.\u201d My brand, if you want to say it as that has been established, and anything different would just be not myself, and so once I ran, and then now especially being a city council member, I feel like Mikey\u2019s probably here for, I think, it\u2019s for life.<\/p>\n

Rob:
But they did make you ditch the propeller hat though.<\/p>\n

Mikey:
I had to get rid of hat. That was a mandatory.<\/p>\n

Rob:
Get rid of the hat, but Mikey Taylor\u2019s here to stay.<\/p>\n

Mikey:
Yep.<\/p>\n

David:
There is a Michael Sailor. It sounds a lot like Michael Taylor. That\u2019s probably not bad company to be considering. He\u2019s a smart guy.<\/p>\n

Mikey:
Yeah, I will take that confusion. Yeah.<\/p>\n

Rob:
What did life look like at the beginning of your extreme sports career from a money and savings perspective?<\/p>\n

Mikey:
Oh. So when I was skating\u2026 Pro skaters don\u2019t make a lot of money. Start with that. It\u2019s not like baseball or football. I was trying to live off nothing essentially, but I wasn\u2019t making that much, so it was really not a lot. As my career started progressing, I started making more, and for the first 10 years, I pretty much tried to maintain spending 20% of my income, and I tried to control my lifestyle inflation as much as possible, and I did pretty good up until having my first child. And when I had my first child, I was in a \u201992 Civic hatchback. No power steering. No-<\/p>\n

David:
Your child was born in the backseat of the car?<\/p>\n

Mikey:
Well, no. It was my wife actually. When we had our first child, my wife looked at me and went, \u201cYou can\u2019t do this anymore. I get that you act like you\u2019re broke and you\u2019re driving this piece of crap around. It\u2019s time for you to get a real person car,\u201d and so I sold that, but I got a Toyota Prius.<\/p>\n

Rob:
That\u2019s a great car.<\/p>\n

Mikey:
Yeah.<\/p>\n

Rob:
People sleep on the Prius.<\/p>\n

Mikey:
I liked it. I ran it for six years. I think I spent 24 grand on it.<\/p>\n

David:
I love how you said, \u201cI ran it,\u201d as if you\u2019re still the Fast and the Furious. Guy\u2019s pushing a Honda S2000.<\/p>\n

Mikey:
Yeah, so basically when I was skating, I was just try to keep expenses as low as possible so that I could make investments in asset classes that you typically need a lot of money for. And I just wasn\u2019t making a lot of money, so I almost had a reverse Dave Ramsey kind of model.<\/p>\n

David:
Strong defense.<\/p>\n

Mikey:
Yeah, that\u2019s right. That\u2019s right. That was it.<\/p>\n

Rob:
So where did that come from, the insane frugality? Is that something that was ingrained in you as a kid, or is that just something that happened later on in life?<\/p>\n

Mikey:
That\u2019s a good question. There were two parts of it. One, I think fear was a big driver for me. Not knowing what life after skateboarding was going to look like was scary, especially considering I didn\u2019t go to college, I was being paid because I could ride a skateboard. I had no idea how that was going to translate into life afterward. And then I would say the next component is I\u2019m a very routine and I\u2019m actually pretty good at discipline and consistency. So that fear mixed with that part of me just, okay, this is the model that we\u2019re going to follow. I\u2019m going to stick to it.<\/p>\n

Rob:
Is that a pretty common way of doing things in the skateboard community, or did you see your friends kind of blowing their cash?<\/p>\n

Mikey:
No, skating was interesting because when I became pro, the skate industry kind of blew up. We went from no one knowing who we were and thinking we were kind of lame, and then all of a sudden Tony Hawk at the scene and skateboarding became pretty large, and so we started making more money. And when other skaters started making more, it was like, \u201cOh, my gosh. I can drive a Cadillac.\u201d The Escalade was the big one. Everybody started getting Cadillacs and no, it was like living the lifestyle.<\/p>\n

David:
This was like 2006 or so?<\/p>\n

Mikey:
This was 2006. It was cranking. It was just money flying everywhere, but we weren\u2019t making crazy money. It was just we were spending it all.<\/p>\n

Rob:
And so did your parents\u2026 You were skateboarding, was it in high school, and then was it time for college and you kept skateboarding or what was that whole life like?<\/p>\n

Mikey:
Yeah, so my story was I started skating when I was 11 or 12, got to 16 and my parents wanted me to get a job, and I didn\u2019t want to work because I felt like that was going to take away from skateboarding. So I basically went out and tried to get companies to sponsor me. I had a handful that started sponsoring me. They gave me free product. By the time I turned 18, I was in the magazines. I had a couple opportunities to start traveling the world, but that was kind of when I was supposed to go to college, and so I told my parents I wasn\u2019t going to go. They absolutely lost it, were not with it, and I basically looked at my mom and I was like, \u201cHey, what if I just do this for a few years? This is an opportunity that most people don\u2019t get. I\u2019ll travel the world. I\u2019ll see some things. I could always go back to school.\u201d
And my mom and my dad too, but my mom more so was like, \u201cOkay, if you\u2019re going to do it though, you have to have help. Somebody has to help you with your money.\u201d Money was the big one. And so she connected me with a financial advisor. I was making 800 bucks a month. He was like, \u201cI don\u2019t even know what to do with you.\u201d And then that was kind of the beginning of this whole process.<\/p>\n

Rob:
Wow. When you were making the 800 bucks a month, is that when you were spending 20% of it?<\/p>\n

Mikey:
No, the first year I spent it all, but I got to a point where in the first couple years I started making, I don\u2019t know, 3000 bucks a month, and then I was like, \u201cOkay, I\u2019ve got a cell phone bill. I\u2019m still living with my parents. Everything else was paid for.\u201d I was doing pretty good not spending money. And then I don\u2019t think my lifestyle really increased much until kids came into play. That\u2019s when it just jumped up.<\/p>\n

David:
I\u2019m curious, your parents were very interested in money. You weren\u2019t making a lot of it, but it\u2019s still on the top of their head. Was money a struggle for you guys growing up? Was there not enough of it to go around?<\/p>\n

Mikey:
Yeah. See, that\u2019s what\u2019s interesting. No, my dad didn\u2019t make a ton of money, but he didn\u2019t struggle. He was a photographer, had a really healthy view of marriage. I never watched my parents fight over a ticket or a bill that was unexpected. They viewed money as a tool. So that was, I think, the good part. I think where the fear element came in and why it was tied to money was my parents and myself really believed that if I didn\u2019t go to college, I was basically saying goodbye to making any type of money. It was like all doors that were going to be open were now not. And so I think that was kind of the fear driving the money side, like if you\u2019re not going to be able to do anything afterward, you better take advantage of this opportunity.<\/p>\n

David:
So where did the interest in real estate come from?<\/p>\n

Mikey:
So real estate came from the financial advisor my parents connected me with because his brother was running a storage portfolio and he was telling me about all the stuff they were doing, and it got to a point where I had enough to invest and they raised money from investors. So my financial advisor was like, \u201cHey, do you want to put some money in storage?\u201d<\/p>\n

Rob:
Hey, man. You\u2019re making 800 bucks a month.<\/p>\n

Mikey:
No, at this point, I was making more. At this point, I started making more. And he basically asked me that. I didn\u2019t know what to say. I didn\u2019t even know what questions to ask. I was like, \u201cI don\u2019t know. Tell me about it.\u201d So he gave me the, \u201cWell, look. People need a place to store things,\u201d and he talked about human behavior. And one thing he did mention, which I always hung onto, was storage performs during recessions or it\u2019s very recession-resilient. I don\u2019t know why at however old I was, 24 or five years old, that resonated, but I remember going, \u201cHuh. So I can count on this thing when times get bad.\u201d
And so I just invested I don\u2019t even know how much, 25 grand. I can\u2019t even remember. And basically it was on trust with him, and then I started getting a quarterly dividend, and then it happened over and over and over. And by the third one I was like, \u201cThis is it. This is my way out. This is how I\u2026\u201d So that was a big moment.<\/p>\n

Rob:
Do you remember what your first dividend was?<\/p>\n

Mikey:
The amount?<\/p>\n

Rob:
Yeah.<\/p>\n

Mikey:
No clue.<\/p>\n

Rob:
No?<\/p>\n

Mikey:
No.<\/p>\n

Rob:
But it was significant? Sorry. Significant enough-<\/p>\n

David:
Well, when you\u2019re making $800 a month, it probably felt significant.<\/p>\n

Mikey:
Okay. So when I invested, I was making more than 800. I was probably making maybe close to a hundred grand a year at this point. My first investment was 25 grand, so no, the dividend was not significant. It was paid-off cashflow, but I think it was the idea of, \u201cOh my gosh\u2026\u201d It wasn\u2019t even wired back then, the check came. The check came again, the check came again. And even though I was making money with stocks and bonds, there was something about the storage side. I don\u2019t know why.
It just kind of clicked and the fear\u2026 And to bring it all home for skateboarders and how this applies to everyone else, I got paid from sponsors, so my sponsors were my employers, and every contract I had was typically a three-year deal. So when I would sign a deal, the only thing through my mind was, \u201cI have security for three years. I don\u2019t know what\u2019s happening after that.\u201d When I got those checks, the dividends, I don\u2019t know why, it just was that aha moment where I went, \u201cOh my gosh. If I get more of those, I don\u2019t have to be so concerned with not getting my next contract.\u201d It was just\u2026 I don\u2019t know.<\/p>\n

David:
Security in an insecure, unstable environment.<\/p>\n

Mikey:
Correct. Yeah, correct. Yeah, so that fear at the end of the tunnel when my career ended started becoming not as dark.<\/p>\n

David:
Okay, so what happens next in this life business adventure that you\u2019re on?<\/p>\n

Mikey:
Okay, so I\u2019m skating professionally for about 10 years, I\u2019m following the same path, basically live like I\u2019m broke, invest as much as I can. In 2011, myself and two of my friends had this idea that we could start a craft brewery. We didn\u2019t have any business experience, we just had an idea and felt like we could do it. And so in 2011, we started going to other breweries basically asking if they could make our beer for us and we would just manage the marketing side of it, and after the third or fourth one, we realized there\u2019s zero money in doing that. We had ultimately had to build our own production brewery, and so I went to my financial advisor. I was like, his name is Randy, \u201cRandy, we have this idea. We don\u2019t know what to do. What\u2019s our next steps?\u201d And he was the one that walked us through having to build a business plan. He helped us build that. When we built a business plan, we realized we didn\u2019t have enough money to start the company. So he started educating us on how we would go out and raise money from investors.
He helped us with the legal connections for the PPM and all the documents, but he helped us with the pitch like, \u201cThis is how you have to go about in communicating what you\u2019re going to ultimately do, build trust with the investors so that they\u2019ll give you money,\u201d and mind you, this is two pro skaters and a surf filmmaker going into an industry where we had no experience. Think about asking you for a, \u201cHey, would you invest in my craft brewery? We don\u2019t know how to brew beer and we\u2019ve never done this before.\u201d You\u2019re like, \u201cPass.\u201d It was hard. So we had a great team that was helping set us up for success, and then we went out and raised money. We raised the amount that we needed to open doors. We opened doors in about May of 2012, and the thing just exploded. We became-<\/p>\n

Rob:
Oh, that\u2019s cool.<\/p>\n

Mikey:
Yeah, it was unreal.<\/p>\n

Rob:
How much did you raise?<\/p>\n

Mikey:
We raised two and a half million dollars the first round, and then we had one, two, three rounds after that. I think we were all in maybe 8 million by the end of it.<\/p>\n

Rob:
Whoa. Okay, so how does that differ when you\u2019re raising money for, let\u2019s say, a business like a brewery versus real estate? Real estate, you do the syndications, you\u2019re like, \u201cHey, you\u2019re the GP, LP. As the GP, I take 30%, GP takes 70,\u201d and then you\u2019re not typically reraising and diluting shares, whereas it seems like with businesses and tech and everything, there are multiple rounds where that\u2019s sort of how that works. Is it similar?<\/p>\n

Mikey:
There\u2019s a part of it that\u2019s similar, there\u2019s a part that\u2019s different, and I\u2019ll go into the differences, but what I will say, after we sold the brewery, I was expecting real estate to be a much easier thing to raise money for. It was actually not, it was little bit harder actually than the business, and I\u2019ll go into why. When you\u2019re starting a business, you\u2019re using models from other companies that have sold. So it\u2019s more of a, we\u2019re going to build it and everyone\u2019s going to make a ton of money. You don\u2019t necessarily need a proforma of the business that you\u2019re starting to get you to the metric of return, where on real estate, here\u2019s your return, here\u2019s all the numbers that you get there, and so you can\u2019t sell this like, \u201cI\u2019m going to quadruple or even beyond your investment.\u201d
But as it pertains to raises, I would say where it\u2019s similar is for maybe a syndicator who needs to recapitalize their deal or maybe they went over budget, they need more capital coming in. You\u2019re calling your investors and going, \u201cWe have a capital call.\u201d It probably is similar to that. It\u2019s calling your investors going, \u201cThere\u2019s a capital call. There\u2019s a capital call,\u201d and then if they don\u2019t perform, you then can take it out to basically outside investors and start raising. So then there\u2019s dilution.<\/p>\n

Rob:
Aren\u2019t capital calls a bit, I don\u2019t want to say unsavory, but not a great thing to do?<\/p>\n

Mikey:
It\u2019s not a great thing to do, but in real estate\u2026 And here\u2019s the difference. If you\u2019re doing a capital call on real estate, typically something went wrong. If you\u2019re doing a capital call on a business that you know you\u2019re going to have multiple rounds of capital to get to an exit-<\/p>\n

David:
It might be an offensive opportunity that you need capital for, not a defensive mistake.<\/p>\n

Mikey:
That\u2019s what it is. In real estate, it\u2019s a defensive mistake. In a startup, it\u2019s part of the process to get you to exit. It\u2019s just expected.<\/p>\n

Rob:
That\u2019s just the way it is, right?<\/p>\n

Mikey:
Yeah, that\u2019s why you go seed and then you go series A, B, et cetera.<\/p>\n

Rob:
So you were planning to exit when you started this company. Can you walk us a little bit through what that process was like?<\/p>\n

Mikey:
Yeah, so this was a piece of advice that when we were basically building the business plan and being taught how to raise money, this is something they said that I\u2019ll never forget. When you ask somebody for money, when you\u2019re raising capital, the first thing that probably is going to come out of their mouth, maybe it\u2019s the second, is how do I get paid back? When do I make money? And so you have to very clearly show them where your exit is, or if you\u2019re building a cashflow, a business that\u2019s going to cashflow, how often those dividends come out. Just basically when does money actually be realized? And so with us, we knew that we were going to pay investors back by an exit, and so in our pitch, it was this is the timeframe. Let\u2019s call it 10 years. There\u2019s going to be multiple rounds up to that point. We\u2019re going to exit, and that\u2019ll be how you get paid back.<\/p>\n

Rob:
Which is similar in even real estate raising too. You\u2019re basically calculating your IRRs, your internal rate of return, based on the exit, most of the time on a five-year exit, seven-year exit, 10-year exit. So I guess this is pretty similar in that because most of the time investors just want to know what that endpoint looks like.<\/p>\n

Mikey:
Right, and you\u2019re totally right. I would say that the challenge is for anybody who runs an open-ended fund, then it gets more difficult to show somebody, \u201cThis is when an exit happens, and this is when dollars go into your pocket.\u201d<\/p>\n

Rob:
That\u2019s what we\u2019re doing right now, the open-ended fund, and it\u2019s tough because just like you said, most investors, they just want to know what the timeline is, not that they want it now, they just want to know that there is a timeline. So open-ended funds are very tough for that reason.<\/p>\n

Mikey:
That is the hard part about them. Open-ended funds, the blessing, you don\u2019t have a capital call need.<\/p>\n

Rob:
That\u2019s true, yeah. So you\u2019re developing this brewery, it\u2019s starting to grow, crush it, I imagine. And how did you make it so that it stood out in a way that\u2019s attractive enough to be bought?<\/p>\n

Mikey:
That\u2019s a good idea. So when we were doing our research on the craft beer industry, what we learned early on is that no companies really marketed a brand. It didn\u2019t exist. Everything was product-driven. So the normal experience was somebody would go to the store, they\u2019d go to the beer, whatever you want to call it, alley, they\u2019d look for brands and something would resonate and then they\u2019d buy it. We went in going, \u201cWait a minute. We come from a world of marketing.\u201d In the skateboarding world, the wood manufacturer, there\u2019s two of them. So every kid is riding the same board, but every kid thinks one board\u2019s better than the other because of the experience that the brand was able to communicate to the kid. So our idea was we\u2019re going to build a brand and experience a lifestyle and market the person prior to them going to the store.
So what we did is we raised money from skaters and surfers and snowboarders, and then our marketing was around them. So 2012, when there were no influencers, we made our investors our ambassadors, and then all of our marketing was many documentaries on them communicating the California lifestyle through their lens. So what does California look like through Paul Rodriguez lens? What does it look like through Taylor Knox lens? And so what happened was we had a whole community of people from California that went, \u201cThis is my beer because they see California like I do,\u201d and there was no one else doing that. So that was the thing that ultimately separated us. And then to add on top of it, we\u2019re doing it all through Instagram at that time. So no one had social media. Imagine a world where no one has social media, no one understands a brand, and we come in and go, \u201cWe\u2019re building a brand. We know how to do it, and we\u2019re promoting it on social.\u201d It just went nuts.
So for context, we became if not one of the fastest growing breweries in California, we had demand in the entire nation and then in the world, we couldn\u2019t get our product out of California. We could not even come close to fulfilling demand. It was the opposite experience that most startups have, and I think in my perspective, it was because of that element where our beer was good, our beer was winning awards, but we were doing something that no one else was doing, which was creating the separation from the many and what helped us stand out.<\/p>\n

Rob:
Do you think you could do it again?<\/p>\n

Mikey:
Okay, so that\u2019s a really good question. When we sold it, I had two partners. Three including me. One of my partners stayed in the beverage industry, so he went and created a seltzer brands called Ashland. Huge brand. My other partner does a company called Primitive, huge clothing brand, and then I went into commercial real estate. We all are still using the same model. He\u2019s still in the same, let\u2019s call it beverage, but we\u2019re all applying it to other spaces. Yes, you can, but a lot\u2019s changed. It\u2019s not 2012 anymore when it comes to social media. Everybody has it now. So you don\u2019t get as much standout just by being on, you actually have to be better than those around you. But yeah, I think I could do it again, yeah. I mean, I\u2019m attempting to now just in a different asset class or a different industry.<\/p>\n

Rob:
Yeah, yeah. So let\u2019s talk about that. You end up crushing it in the brewery world, you sell it. At what point is it\u2026 Are these happening at the same time? Are you getting into real estate and you\u2019re doing the brewery thing, or does the real estate come after?<\/p>\n

Mikey:
Good question. No. Okay. Investing was happening passively in real estate. It was not active at all up until this point. Started the brewery, sold the brewery, and then I had about a year of trying to figure out what was next. I didn\u2019t know. Actually, I went through a tough period of transition. Sold the brewery, I was no longer a pro skateboarder, I had two little kids. My wife and my marriage was not going well, and I was being hit with identity and purpose challenges as well, so I had basically a year of figuring life out and my wife and I especially had a year of rebuilding marriage, our marriage. Then at the end of \u201916, early \u201917 is when I came up with the idea for Commune and then started working on building this company out.<\/p>\n

Rob:
What is Commune?<\/p>\n

Mikey:
We\u2019re a private equity real estate firm. No, about a year. About a year of trial, I would say.<\/p>\n

Rob:
So you start Commune, or a year of trial. Do you go right into what\u2026 I know you were investing passively into the storage game. Did you decide to just go all in there?<\/p>\n

Mikey:
Good question. No, we started with multifamily.<\/p>\n

Rob:
Okay.<\/p>\n

Mikey:
Yeah. Look, storage. Anyone who\u2019s an investor in storage is going to resonate with what I\u2019m about to say. It\u2019s a phenomenal asset class. They are cash machines. You don\u2019t have to deal with tenants living there, there\u2019s a part of the operations that is, in my perspective, a lot easier. But at the end of the day, it\u2019s a bunch of garages. It\u2019s not the most sexy asset class. And so when we started Commune, I wanted to use what we were talking about with Saint Archer, which is the brewery, what I thought my skill was to try to create a value add or separation on the assets that we were basically going to go buy, and I felt like multifamily and ultimately building out homes was the ultimate experience. Talk about adding value through marketing or brand. I felt like that was the one, mixed with it had, what we talked about earlier, performed well during recession, so it hit the safety or the risk adversity that I wanted, and then I was able to, what I thought, hit a value add.
What that meant for our business model, we were going into markets that the creatives were going into first. So what we see if we\u2019re looking at California, right? Skaters, photographers, artists, they go into the sketchier areas and then they make it cool, and as it\u2019s becoming cool, then you start seeing the home flippers come in and you start seeing all the cool retail, then years later, the big institutions get here. So our whole model in the beginning was follow the creatives, go in and actually create an apartment that the youth wants. If the creatives are going there, what do the creatives want? They want an apartment that they can film content at. It\u2019s really basic stuff, but for our generation, it made sense. They want something that looks good, they want people like them in the community and make it so that it\u2019s current with technology. No keys, make it all keyless entry. And we did really well in the beginning with that.<\/p>\n

Rob:
That\u2019s really funny because you remember when we had Barbara Corcoran on the show, that was her exact strategy for when she was building her empire in New York, and she would go to restaurants and she would talk to the waiters and she\u2019d be like, \u201cHey, where are the hip artists staying?\u201d And they would tell her, and then that\u2019s where she would go and buy real estate.<\/p>\n

Mikey:
Yeah. And look, I came from skating. My whole community\u2019s plugged in here. So what that looked like, our first apartment we did was in Long Beach. And in Long Beach, 4th Street is kind of what started to become built out, so we started looking for assets above 4th. It was like 5th, 6th, and 7th is where we were looking. So we got in there, we got in there early. A couple of my partners said, \u201cAbsolutely not. Why are we doing this?\u201d And then we ended up building it out and three years later was the hit place to be, and we ended up selling it. We did well on it.<\/p>\n

Rob:
Really? When you said value add multifamily, just for everyone at home that doesn\u2019t really know what that means, break us through that process a little bit.<\/p>\n

Mikey:
Okay. So value add ultimately means that you\u2019re going to do something to increase the value of the property, but you can do that with a lot of different levels in a sense, somebody can come in and do a light value add, which is typically paint and maybe do landscape, et cetera, or you can do a deep value add, which is basically bringing something down to the studs and really trying to, if you\u2019re looking from a rent standpoint, increasing rent significantly, and then I would say the ultimate value add would be a redevelopment, scraping something and building. And so that\u2019s actually what we do\u2026 I mean, 100% of our business right now is complete development. We scrape and build now.<\/p>\n

Rob:
You tear down and you rebuild?<\/p>\n

Mikey:
Tear down and build.<\/p>\n

Rob:
Because I\u2019ve always been told, especially these days, it is rare for that to ever make sense to actually where it\u2019s cheaper, or oftentimes you don\u2019t want to tear it down, you\u2019d rather just fix it up and make it nicer.<\/p>\n

Mikey:
Sometimes. Sometimes that\u2019s the case, but there\u2019s cycles, right? There\u2019s points where your yield on cost is going to be close to or less than your cap rate. If that\u2019s the case, then you don\u2019t build because you can buy something at a higher yield than you can build. But in times like this, that\u2019s not the case. Depending on the market you\u2019re in, right? Like invest, you brought it up from the beginning. We invest in California. A lot of people do not invest here. It\u2019s difficult to build. California scares a lot of investors out, but because of that, our markets and a lot of cities are undersupplied, so we typically go into markets that are undersupplied, build more units. Right now we\u2019re in a point where city councils are saying yes to almost everything, and then we get our value add by adding a product that has demand in an area that needs it.<\/p>\n

David:
You mentioned when your yield on cost is greater than the cap rate, you said it doesn\u2019t work?<\/p>\n

Mikey:
When your yield on cost is less than the cap rate. So basically if your yield on cost, let\u2019s say, is 5% and the cap rate\u2019s 5%, why would you build it?<\/p>\n

David:
You could just buy a 5% return.<\/p>\n

Mikey:
Correct. You want a spread. So basically on your yield on cost, what most people look for is about a 250 bip or 2.5% margin or spread from build to curtain cap rate. So if cap rates are at, let\u2019s say, 5% right now, you\u2019d want your yield on cost to be, let\u2019s say, 7.5%.<\/p>\n

David:
When you\u2019re saying yield on cost, you\u2019re referring to the cost to build?<\/p>\n

Mikey:
Correct.<\/p>\n

David:
How much money you have to spend and the return you\u2019re going to get on that money.<\/p>\n

Mikey:
Correct.<\/p>\n

David:
So we\u2019re going to go build a $2 million property, and if it\u2019s going to bring us back a 5% return, then that\u2019s a five cap. It\u2019s a build on cost of five. So what you\u2019re saying is that if that number is greater than what you can buy at, it makes sense to go build.<\/p>\n

Mikey:
Yeah. So this is a metric that a lot of the institutional investors look for. Another way to say it is basically that you\u2019re building to a cap rate from a yield standpoint. So if cap rates are, let\u2019s call it, 5%. If you buy an existing product, let\u2019s say, you know you\u2019re going to get an unlevered 5% return, but you can go build it to, let\u2019s say, a 8% yield on cost. That premium may be worth the build.<\/p>\n

David:
And that would be called 300 basis points or 3%.<\/p>\n

Mikey:
Correct.<\/p>\n

David:
100 basis points is 1%, so 250 basis points is the number you said they want to be, which is about a 2.5% increase.<\/p>\n

Mikey:
Correct. And then when you start getting into at least some of the bigger investors, if it\u2019s not a big enough spread, they\u2019re not coming in.<\/p>\n

David:
Because the time you\u2019re taking and the effort and you got to hire people to make sure it\u2019s going to happen and the market could change versus you just go in, you buy something else, and it\u2019s way less work time and risk.<\/p>\n

Mikey:
Correct.<\/p>\n

David:
So the bigger the spread is needed to justify the additional risk, time, expense, human beings that have to manage the process, something that could go wrong.<\/p>\n

Mikey:
Correct. Anytime you\u2019re taking more risk, you need a premium for that risk.<\/p>\n

David:
I\u2019m glad you said that because I mean, we don\u2019t want to go too far down this road, but a lot of people let risks scare them, but if you can quantify risk, if you can turn it into some form of a number, you can bake it into your overall numbers and now it\u2019s not so scary anymore. Rather than looking at risk as something to be avoided, it has to be something that can be quantified, and now there are times where, okay, we\u2019re adding risk, but the reward so much outweighs it that it actually is smart to move forward with that, and I think that stops a lot of people from investing at all.<\/p>\n

Mikey:
1000% is you\u2019re almost actually experiencing in some regard the reverse right now where you can go after deals with less risk right now that a lot of people were taking a year and a half ago, but the return is a little bit less than people that are still levering up and expecting a refi in two years. And they\u2019re going, \u201cOh, I\u2019ll take the bigger return,\u201d because it\u2019s the bigger return, duh, but they\u2019re not including the-<\/p>\n

David:
The increased risk, yeah.<\/p>\n

Mikey:
Correct.<\/p>\n

David:
Which is really what insurance companies have done to make themselves so valuable is they\u2019ve just quantified risk for you. They\u2019re like, \u201cYeah, all these things could go wrong, but if they do, we\u2019ll cover you for this cost.\u201d They just bake that cost into whatever you\u2019re paying for the property and you know if it makes sense.<\/p>\n

Mikey:
Correct, yeah. And even from a pitch standpoint, this happened to me recently, so I\u2019m just thinking of it. We were talking to a potential investor, they had their manager on the line as well, and the manager\u2019s talking to the person and goes, \u201cHey, just so you know, this is a high-risk investment. You just need to know this is a high-risk investment,\u201d and I looked at him, I was like, \u201cHey, I just want to put this out there. If you\u2019re saying this is a high-risk investment without any context, you\u2019re going to look at this return and go, \u2018Wait. That\u2019s all?’\u201d A high-risk investment was the brewery. That was a high-risk investment. The brewery 12x\u2019d everyone\u2019s investment three and a half years. If you\u2019re expecting that risk and that return with this, that\u2019s not it. This is a risk adjusted return, but in real estate, there\u2019s different risk in that category. So I think it\u2019s really important to know a riskier investment in, let\u2019s say, real estate, does not mean it\u2019s the same as a risk or investment in tech, or-<\/p>\n

David:
It\u2019s relative to that asset class, correct?<\/p>\n

Mikey:
Correct.<\/p>\n

David:
Yeah, that\u2019s a great point. When you say this is a risky investment in tech, that\u2019s saying a lot because tech is sort of inherently risky in a lot of cases. You could say this is a risk-ladled real estate investment. That might not mean a whole lot because real estate, it\u2019s safe compared to most asset classes.<\/p>\n

Mikey:
Correct.<\/p>\n

David:
Well, hold on a second. You said you\u2019re investing in California and then you described this is why we\u2019re investing in California, because there\u2019s not enough supply, which is one of the things I just think no one looks at when they\u2019re picking a market. They ask, \u201cWhat\u2019s my cap rate? What\u2019s my IRR?\u201d They\u2019re asking questions on the return they\u2019re going to get. They\u2019re not asking why. What\u2019s the supply demand revenue here? What\u2019s driving that? And a lot of people do look at demand to their credit like, \u201cOkay, people are moving here. It\u2019s a good thing to look at. Okay, jobs are moving here. That is a good thing to look at.\u201d
I just don\u2019t hear anyone in the real estate space say, \u201cThis market has constricted supply. It\u2019s hard to build here. It\u2019s already built out,\u201d like what you had said. That\u2019s how you knew in Long Beach where to go. You said, \u201cIt was built out to 4th Street, so we started looking at these areas,\u201d which is where the path of progress had to go. It\u2019s not completely speculative when you know what\u2019s driving it to see that it\u2019s reasonable to expect this, and something about your brain picked that up.<\/p>\n

Mikey:
I think from my brain, I knew back then where the trends were headed. I have a partner, he\u2019s the smartest person I know, he\u2019s brilliant. A lot of what I\u2019ve learned over the last seven years has really come from him, from at least some of the stuff we\u2019re talking about now. I remember one of the first things he told me, when we\u2019re going to look at doing basically any type of purchase, the first question we ask is, do we want to own this thing for the next 10 years, and is there demand to own this thing for the next 10 years? And if there is and you\u2019re going to hit the rents that you need to hit, it doesn\u2019t really matter what happens in the interim.
But a lot of times, to your point, when we\u2019re looking at new projects, we go, \u201cOh my gosh. I\u2019m going to buy it now. And what are interest rates and cap rates going to do in four years?\u201d It doesn\u2019t matter because as long as there\u2019s nothing to force a sale in your time horizon. If you have the demand, it\u2019s staying off, but you\u2019re cash flowing, who cares? And so that was a good beginning metric for us: Is there going to be demand for the next decade?<\/p>\n

Rob:
Yeah. I mean, it\u2019s having a pretty long-term perspective on your investments.<\/p>\n

Mikey:
But even if you don\u2019t. Sometimes we\u2019ll promote or look at a five-year hold, and so when we\u2019re showing investors, we\u2019re showing an IRR based on five years, but what we\u2019re saying is, \u201cLook, this is the plan, but there may be a situation where we can\u2019t sell it in five. If it\u2019s not an opportune time to sell, we\u2019re not going to sell,\u201d and then we extend it to 10 and show them what the return is on a 10-year hold. And if the 10 year hold is still a good return, but if we are able to sell it at five for maybe a big pop, that\u2019s how we go about it. But we need to make sure that if we can\u2019t sell, it\u2019s still a good asset to hold.<\/p>\n

Rob:
Did multifamily end up being the foundation of Commune, or did you-<\/p>\n

Mikey:
So multifamily was the first asset class that we went into. It was the first fund that we built out, but we were using social media for some of the stuff we were talking about, the brand experience, and we took a pretty big push into financial literacy. We wanted all of the content to be educational and actually a little bit more broad than just real estate. I wanted to make sure that the person that followed me, even if they were an 18-year-old skater, was still getting the basics, how to build a budget, how to build credit, how to have a plan on what to invest in all the way up to some of the stuff we\u2019re talking about, yield on cost or debt yield, something more specific to our industry.
And what happened is very quickly we started getting opportunities, we started getting deal flow from social media, we started getting investors from social media, and the brand started growing at a very sizable rate. Then what happened is my partner who\u2026 There\u2019s a part of this story I didn\u2019t tell you. My financial advisor, his brother who was running the storage portfolio. When I came up with the idea for Commune, I brought the business plan to them because I didn\u2019t know what fund management was. I didn\u2019t even know how to build a fund that was different than what we did last. So I brought my business plan to them, they looked at it, and instead of them educating me on what to do like they did with the brewery, they looked at me and said, \u201cWould you ever think about doing a partnership?\u201d And so we created a management company, which was Commune Capital, and then our first fund was the multifamily fund.
They had a storage management company managing the storage portfolio that I was investing in passively, and they had built it over the last 20 years all from kind of the more traditional way of doing it. Our assets are performing, we\u2019ve given a great return, investors have told their friends, et cetera. Well, in about 2019, they\u2019re looking at Commune and it\u2019s taking all of the attention. It\u2019s growing and grabbing people at a way crazier rate than storage, but storage should be doing that because of the historical performance, et cetera. So they actually presented the idea to me at the end of 2019 about merging our companies together. And so in 2020, we did. The two management companies became one, and then the storage portfolio came into Commune. They had a lending portfolio as well. And then since then we\u2019ve done, I don\u2019t know, five different offerings after that.<\/p>\n

Rob:
Wow. Okay. And so then-<\/p>\n

Mikey:
So a little bit more context. Started with multifamily, then we added storage, which I had been investing in forever into it, then the debt fund. Now we have our second multifamily portfolio, our second debt fund. We\u2019re about to reopen storage, and we\u2019ve done a handful of syndications along the way.<\/p>\n

Rob:
What is a debt fund? Does that basically mean that you\u2019re raising money from people and just paying them an interest rate?<\/p>\n

Mikey:
It basically means we become the bank. So when people are looking for bridge debt, we basically lend on the commercial asset, and then we take our interest, and that interest is then paid to the investor.<\/p>\n

David:
And you\u2019re lending on assets that you have some understanding of in case you have to take it back?<\/p>\n

Mikey:
Really good question. Multifamily and storage, yeah. Before we even lend on a deal, we ask ourself, \u201cIs this a deal that we would want to own from an equity position?\u201d<\/p>\n

Rob:
Because you might have to, right?<\/p>\n

Mikey:
Because it\u2019s not\u2026 You might. You will always have assets that become troubled and you have to take over. If you\u2019ve been in the business long, it\u2019s going to happen.<\/p>\n

David:
Kind of like motorcycle riders say you don\u2019t dress for if you crash, you dress for when you crash.<\/p>\n

Mikey:
Correct. That\u2019s right. So it happens.<\/p>\n

Rob:
Have you taken over any yet?<\/p>\n

Mikey:
Of course. Yeah, of course. It just happens.<\/p>\n

David:
But you know what I love about this idea is it\u2019s sort of a vertical in you\u2019re not learning a completely new business. You understand this asset class, now you\u2019re going to learn maybe five or 10% new information, which is just how to make loans, how to price loans, but if it goes bad, this is a property that we could have bought, we already like it. It\u2019s not a completely new thing. There\u2019s a lot of synergy between it, but it\u2019s another income stream.<\/p>\n

Mikey:
It is. Think of it this way: You do want a loan to perform. It is easier when it does, everybody gets their interest, everybody\u2019s happy, right? Loan gets finished, then you got to get money back out, that would maybe be the challenge, but if you lent on an asset that is a good asset and you have to take it over and you understand it, you just took over an asset for potentially 65 cents on the dollar if your max loan to value is 65%. So you can look at it through that lens if you need to take something over, you bought something that you wanted to buy at a discount.<\/p>\n

Rob:
I mean, obviously it\u2019s easier just for the loan to perform, but are y\u2019all, at this point with your experience, so good at seeing a distress or a bad property that failed that you\u2019re taking over and being like, \u201cOh, all we have to do to fix it is this, this, this. Is it always pretty straightforward at that point, or is it a bit of a haul to get your team-<\/p>\n

David:
My thought would be if the person couldn\u2019t deliver, something went wrong that you now have to jump in and fix that problem. Is that-<\/p>\n

Mikey:
Correct. Yeah, that\u2019s correct. And we didn\u2019t do this always. Now we\u2019re at the point where it\u2019s multifamily storage only. But yeah, there are points\u2026 Let\u2019s say we lend on a construction project and it stalls out 70% complete, we have to come in and finish it. It does take time and it does take brain damage, and that\u2019s why I said it\u2019s better when they just pay off. You can get to scale easier and things work a little bit more smoothly when they don\u2019t, but when a project doesn\u2019t perform, it\u2019s not that awful of a scenario, you actually take something over.<\/p>\n

David:
You\u2019ve mitigated your risk.<\/p>\n

Mikey:
Correct. Correct.<\/p>\n

Rob:
And how much have you raised in your debt fund?<\/p>\n

Mikey:
So our debt fund, we\u2019ve done about maybe a little over 300 million in loans. Maybe 330 million. And that\u2019s probably right now, I don\u2019t know, maybe we have 50 million raised in that.<\/p>\n

David:
And are you borrowing money from other debt funds and then there\u2019s a yield spread between what you can lend it at and what you paid them?<\/p>\n

Mikey:
On our equity side?<\/p>\n

David:
Yeah.<\/p>\n

Mikey:
Yeah.<\/p>\n

David:
No, no. Sorry. I was thinking on the debt side, on your debt fund.<\/p>\n

Mikey:
No. No, on our debt fund, we\u2019re first position only.<\/p>\n

David:
That is the money that you\u2019re lending out money you guys have saved up through your company, or?<\/p>\n

Mikey:
Oh, I see what you\u2019re saying. No, we raise it from investors. Yeah, so we\u2019ll go out, raise a certain amount of money, put that into a loan, we get our interest, interest is paid to the investor, we take a split like we were talking about earlier, and then we just constantly go through the cycle.<\/p>\n

David:
And if the loan doesn\u2019t get repaid, you have to take it over the investor. It just takes longer before they get their capital back.<\/p>\n

Mikey:
Depending on where the project is. Yeah, if the project is, let\u2019s just say, stabilized for whatever reason, well, it\u2019s not that much longer until they start getting paid back, but we do it in a fund. So just because one becomes troubled doesn\u2019t necessarily mean that investor\u2019s not getting a dividend. Maybe the dividend becomes a little bit less through that timeframe potentially, but if you were maybe\u2026 I don\u2019t even know if you could, it\u2019d be hard to syndicate, but if you were syndicating loans and one become troubled, then yeah, an investor\u2019s not going to see a dividend potentially.<\/p>\n

Rob:
I remember you had a pretty interesting business model. I don\u2019t know if you\u2019re still doing this, but I seem to remember you were buying old Kmarts and turning them into storage facilities.<\/p>\n

Mikey:
Yeah, we\u2019re still doing that.<\/p>\n

Rob:
Okay, you\u2019re still doing that? So how does that work? You find it\u2026 I mean, because Kmarts seemingly don\u2019t go out of business all that often, but\u2026<\/p>\n

Mikey:
Okay, so we look for Kmarts, Walmarts, Bed Bath & Beyonds, which go out of business.<\/p>\n

Rob:
Toys\u201dR\u201dUs.<\/p>\n

Mikey:
Correct.<\/p>\n

David:
Have you thought about just following Tai Lopez around and snagging up all of the buildings that go vacant from his businesses?<\/p>\n

Rob:
Was it Radio Shack or something?<\/p>\n

Mikey:
He was doing Boot Barn and Radio Shack.<\/p>\n

David:
Exactly.<\/p>\n

Mikey:
This is why it\u2019s the no. There\u2019s actually a lot of big box retail that goes vacant. That\u2019s something that\u2019s completely out there. The challenge is the city. Cities don\u2019t like storage, and they absolutely do not want what used to be a Bed Bath & Beyond that employed a certain amount of people and brought revenue to the city to go into storage. That\u2019s not something they want.<\/p>\n

David:
It\u2019s not an amenity for a city,<\/p>\n

Rob:
Because it\u2019s ugly or is it because of the actual income side of it?<\/p>\n

Mikey:
It\u2019s actually not necessarily ugly because when we do our properties, you\u2019ll drive in and you\u2019ll go, \u201cOh my gosh. This looks like a brand new Kmart.\u201d It\u2019s a life storage. So from an aesthetic standpoint, there\u2019s not much that changes. What the city loses out on is sales tax and employment. That\u2019s what they don\u2019t like.<\/p>\n

David:
You want to move to a new city, they have a big beautiful Kmart that makes it easier to sell houses there, they get more property taxes, the Kmart is generating revenue for all people coming there.<\/p>\n

Mikey:
And they get jobs for their residents, that\u2019s a big one.<\/p>\n

David:
And all those people are paying taxes on the money that are coming in. And then you get a self-storage facility, which is run very lean. You don\u2019t need hardly anybody. I can see how if I ran a city and you\u2019re like, \u201cWell, do you want to have a new Bass Pro shops, or do you want to have a self-storage facility?\u201d It\u2019s like asking a kid, \u201cDo you want to eat broccoli or do you want to have a Snickers?\u201d<\/p>\n

Mikey:
That\u2019s right. So that\u2019s what we do on storage, and when you do it\u2019s really good. We\u2019ve done well with our storage portfolio, but it\u2019s hard to stay focused on one area, it ends up being really spread out. So our properties are all over the place, and then we don\u2019t do a lot of deals. I was telling you earlier, we\u2019re going to do one storage property this year, one conversion. We did one last year, so it\u2019s not a lot. Whereas multifamily, I mean, we have five projects. We\u2019ve got three under development, are currently building out. We\u2019ve got four under\u2026 It\u2019s just it moves a lot quicker on multifamily.<\/p>\n

Rob:
But how does it work with, let\u2019s say, Kmart or a Walmart or whatever? Because I thought that it would effectively be the person that owns the real estate leases it to Kmart, Kmart signs a five-year lease. They don\u2019t own the real estate. Then Kmart goes out of business or vacates that. Are you then now the next lease holder of that building?<\/p>\n

Mikey:
We buy it from the owner. So that might be buying it from a bank, it might be buying it from an actual individual. It depends.<\/p>\n

Rob:
Is that owner panicking if Kmart leaves?<\/p>\n

Mikey:
You would assume so, but not always, believe it or not.<\/p>\n

David:
Maybe if it\u2019s paid off.<\/p>\n

Mikey:
Yeah, we get some owners that hold those things for a long time.<\/p>\n

David:
But I think what he\u2019s getting at is why would they sell it to you as self-storage rather than just rent it out to Walmart instead of Kmart?<\/p>\n

Mikey:
Really good question. What they\u2019re going to attempt to do is get an anchor in fast. That\u2019s what they\u2019re attempting to do.<\/p>\n

David:
And see if Target wants to open a store.<\/p>\n

Mikey:
Correct. They\u2019re going to put that in. You\u2019re right. But what happens, at least a lot of the properties that we end up getting, they\u2019ve been vacant for a long time. So they attempted to get somebody in, they can\u2019t do it, the property\u2019s been there for a couple years now, it\u2019s starting to become distressed, there\u2019s weeds coming up through the parking lot. Maybe there\u2019s windows being broken that aren\u2019t getting fixed. Then it starts becoming panic mode.<\/p>\n

David:
You send all your skateboard friends in the parking lot to just go and cause a big scene, so nobody wanted to rent it? Just unleash your minions to get a better deal?<\/p>\n

Mikey:
Absolutely not.<\/p>\n

Rob:
So walk us through a deal like that, like a Kmart, which you\u2019ve done, because I\u2019m super fascinated by this. What does one of those deals look like? How many units go into a typical Kmart? I know it depends on square footage, and I guess that\u2019s cheaper to retrofit a Kmart than it is to build a storage unit facility?<\/p>\n

Mikey:
Yeah, a lot of times it is. Well, there\u2019s more to it, but potentially, I guess, it would be the best way to say it. What you look for, you typically need something a little bit larger than a hundred thousand feet, and then most of our properties we get in, I would say, between 11 and 1200 units in each facility.<\/p>\n

Rob:
Wow, that\u2019s huge.<\/p>\n

Mikey:
Yeah, we get a lot in it. Yeah, we\u2019ll double stack them. I\u2019ll show you a video after this. It\u2019s funny, man. You seriously feel like you\u2019re driving into a Kmart and then you walk in and it\u2019s just endless rows of storage.<\/p>\n

Rob:
If you\u2019re watching on YouTube, we\u2019re going to B-roll it right now.<\/p>\n

Mikey:
Yeah, I\u2019ll send you some clips.<\/p>\n

David:
It sounds like the scene in The Matrix where you\u2019re seeing all the pods of little human beings that are all\u2026 Matrix clip there in case you ever haven\u2019t seen that movie, Rob.<\/p>\n

Rob:
I\u2019ve seen it a time or two.<\/p>\n

Mikey:
You can get a lot in, yeah.<\/p>\n

David:
So I mean, do you just go hire an engineer to draw out the plans for how it would be converted, hire a contractor to build it out and do you build it out in chunks or do you just build out the whole thing?<\/p>\n

Mikey:
Build out the whole thing.<\/p>\n

David:
And then the cost of capital probably plays a big role in what you can do with it, right? Because that\u2019s a lot of money that you\u2019re putting to redeveloping and you\u2019re not going to make a ton of money back right away.<\/p>\n

Mikey:
Correct. Yeah, and I mean they\u2019re not crazy check sizes actually. Compared to our multifamily, it\u2019s a smaller equity check.<\/p>\n

David:
Yeah, you\u2019re not building bathrooms, you\u2019re not building kitchens.<\/p>\n

Rob:
Can you give us an example of one?<\/p>\n

Mikey:
Yeah, I would say would say the average check size for our storage is, I don\u2019t know, maybe 5 million bucks. So maybe it\u2019s like a total cost of around, let\u2019s call it, 13. Our multifamily, I mean, total cost is usually north of 40.<\/p>\n

Rob:
Wow. Okay. So you\u2019re raising 5 million bucks to basically get into this $13 million development or redevelopment. What kind of return does one expect from that? What\u2019s the hope on the cap rate?<\/p>\n

Mikey:
Yeah, so it\u2019s going to vary on the time in the project, but I would say we typically want to see a project level IRR north of 20, 23, 24% IRR, and then what that yields to the investor. I mean, that\u2019s changed throughout the years. Right now we\u2019re in a different scenario. The financing markets are different, but right now we\u2019re targeting about a 14, 15% IRR.<\/p>\n

David:
It\u2019s still better than most people are getting out of the apartments.<\/p>\n

Mikey:
But the apartments, I mean, that\u2019s a heavy lift. You\u2019re talking about a three-year project just to get to build in California and then\u2026 What we want to see on a project level, I mean, healthy twenties.<\/p>\n

David:
Okay. How do you find out that there\u2019s a vacant Kmart?<\/p>\n

Mikey:
A couple ways. We have relationships with brokers. There\u2019s groups that are super good at getting direct to owner. We typically get our stuff through-<\/p>\n

David:
You\u2019re going to the person that if I own the building that leased to Kmart and I found out that Kmart\u2019s going out of business and they\u2019re breaking their lease and I\u2019m panicking, I\u2019m calling a broker to be like, \u201cHey, who do you know that wants this space?\u201d That\u2019s the person you\u2019re going to go build the relationship?<\/p>\n

Mikey:
Yeah, so we will get a lot of deals through brokers and then we do have a couple development partners. So we will also get deals from developers that we\u2019ve done this with and they\u2019ll say, \u201cHey, we got the deal. Do you want to come in on this one with us?\u201d And then we will. So I would say that\u2019s the two sources. And then every once in a while we have had projects where the lending portfolio had to take something over and then we repurposed it into storage. Yeah, that\u2019s happened in the past.<\/p>\n

David:
That\u2019s kind of a nice little tool to have in your tool belt when you take this thing back, \u201cWell, we always got the storage play.\u201d<\/p>\n

Mikey:
It is nice, it\u2019s just hard. It is so difficult.<\/p>\n

David:
Because of the rezoning, the city just fights you on it all the time?<\/p>\n

Mikey:
It\u2019s the rezoning part, yep. Rezoning entitlement\u2019s just tough.<\/p>\n

David:
Mom burned the macaroni and cheese broccoli again tonight. You got to get the kid to eat the broccoli when they don\u2019t want to, I can see that.<\/p>\n

Mikey:
Yep. Yep.<\/p>\n

Rob:
So do you know on one of those projects what the total cashflow was for the storage facility? Pre-splits, because I know you got investors and stuff like that.<\/p>\n

Mikey:
Well, on our storage portfolio, it\u2019s going to be hard to give you an answer to that. That\u2019s been an open-ended fund and we\u2019ve brought investors in at so many different stages that it\u2019s going to vary.<\/p>\n

Rob:
Got it, got it. Okay, cool.<\/p>\n

David:
All right, so I understand you\u2019ve got four things that you have learned in the past that you can narrow down to share with our audience. Can we walk through those?<\/p>\n

Mikey:
Yeah, we can. I would say the first would be starting with the end in mind, and this happened to me from my mentor. He asked me about my financial freedom number when I was young and I had no idea what that meant, and so what he said, and which ended up becoming very important in my life was, \u201cYou have to know what your goal is so that we can actually find the path to get there.\u201d That was huge for me. So trying to figure out what our end goal is and then find the best path to get there is really important to do from the beginning. I would say two, consistency and discipline. That has been the model for me. Anytime I\u2019ve ever tried to hit a grand slam, it\u2019s gone nowhere. If I just focus on singles and doubles, I\u2019ve done really well. So that\u2019s been a big model for me. Three, lifestyle inflation is probably the big one. I think this is something we all fall victim to as we start making more money.<\/p>\n

David:
This is also called lifestyle creep.<\/p>\n

Rob:
Lifestyle creep.<\/p>\n

Mikey:
Lifestyle creep, yeah. Lifestyle creep. As we start making more, we spend more. It\u2019s like we all fall victim to it, but if we can control how much we\u2019re spending, we start making more, this actually gets us to our financial freedom goal faster. So it\u2019s actually really, really important to hold that discipline. And then four, I would say how to make yourself stand out or the separation factor. When we talked about how we did it with Saint Archer, we found an industry that was saturated, had a lot of people doing breweries in especially San Diego, and we figured out how to take an idea out of the red ocean scenario and put us into blue.<\/p>\n

David:
Can you describe what you mean by that?<\/p>\n

Mikey:
Yeah, so basically when you\u2019re starting something in an industry that\u2019s saturated, it means competition is everywhere. It\u2019s very difficult.<\/p>\n

David:
That\u2019s a red ocean.<\/p>\n

Mikey:
That\u2019s a red ocean. Blood in the water, it\u2019s saturated. What you need to understand is you don\u2019t always have to reinvent the wheel and you don\u2019t always need to create something new. You can find an industry that\u2019s saturated and actually create a spinoff that then creates separation and puts you in blue ocean scenario. What I like about that actually is you\u2019re going into an industry that has proven demand. You don\u2019t have to build it and hope they come, but then you can create something that makes you different than everyone else, and then it feels like you are one of a kind.<\/p>\n

David:
Which is the blue ocean.<\/p>\n

Mikey:
Which is the blue ocean. That\u2019s where you ultimately want to be. So with Saint Archer, that would be the ambassadors and social media. With our company now, it\u2019s actually a similar model.<\/p>\n

David:
So yeah, for your brewing company, you knew people want beer. Red oceans have proven it, people like to drink beer, but you don\u2019t want to have to go say, \u201cHere\u2019s why I\u2019m better than Budweiser,\u201d or something. So instead you create a marketing plan that nobody else is doing so you\u2019ve got this whole blue ocean of people, \u201cWow. That\u2019s so cool. I\u2019ve never seen that before,\u201d rather than how do I make a better commercial than the Clydesdale horses for Budweiser.<\/p>\n

Mikey:
Correct. So how that applies to everyone, if you\u2019re going to start something or get into doing something, you have to ask yourself, \u201cWhy would somebody go to me versus anyone else?\u201d You have to have that one thing that separates you and it\u2019s a really important test and why I think business plans are so important is it forces you to figure out what that is so that you actually have a fighting chance to have something successful.<\/p>\n

David:
I like it, man. This is some really good stuff.<\/p>\n

Rob:
This is good. We saved the good stuff for the end. So one was start with the end in mind. Two, discipline and consistency. Three, lifestyle inflation, don\u2019t let it creep up on you. And four, make sure you stand out. Have a way to stand out from the competition.<\/p>\n

David:
Absolutely. And if you guys would like to learn more about how to have consistency and discipline, check out episode 810 where we just interviewed Greg Harden. He\u2019s actually Tom Brady\u2019s performance coach, and he talked about this very stuff and I\u2019m like, \u201cYou know what, this is good because now when Mikey teaches you how to make millions of dollars, you can use Greg\u2019s information to help you get there.\u201d<\/p>\n

Mikey:
Oh, that\u2019s good. That\u2019s good.<\/p>\n

Rob:
Meanwhile, I\u2019m going to be swimming over here in the green ocean.<\/p>\n

David:
You\u2019re getting so much better at this. That\u2019s like your fourth callback to the color green. Very nice. I\u2019ll have to describe what a green ocean is.<\/p>\n

Rob:
Awesome. Well, if people want to learn more about you, connect, invest, do all that kind of stuff, where can they learn more about you?<\/p>\n

Mikey:
Okay, so my social media is just Mikey Taylor. Our company is called Commune Capital. That\u2019s the same on all the accounts, @Commune Capital. Our website, communecapital.com. And then yeah, reach out. Anything you need, I try to provide any type of information that I\u2019ve been given to anybody who wants to hear it.<\/p>\n

Rob:
Mikey is the king of TikToks and Insta Reels, so go check those out. He\u2019s always got nice spicy hot takes, and meanwhile David, maybe we rebrand you instead of Davidgreene24, Davey Greene.<\/p>\n

David:
I just don\u2019t know that\u2019s what my audience is looking for. You keep trying to turn me into an infant or a goofball with every single one of your ideas.<\/p>\n

Rob:
Well at least put on the propeller hat I bought you.<\/p>\n

David:
There we go.<\/p>\n

Mikey:
I wouldn\u2019t change anything.<\/p>\n

David:
You think Davidgreene24 is okay?<\/p>\n

Mikey:
Yeah.<\/p>\n

David:
I appreciate you saying that.<\/p>\n

Mikey:
I wouldn\u2019t change anything.<\/p>\n

David:
The first three guests that we had today were like, \u201cWhy is that your social media? It\u2019s boring, it\u2019s dumb. You need to change it.\u201d Then we asked Alex and Leila Hormozi, they\u2019re like, \u201cNo, it\u2019s just you. Who cares?\u201d<\/p>\n

Rob:
I like that you said that with the Hispanic accent. Hormozi.<\/p>\n

David:
But he\u2019s not Hispanic.<\/p>\n

Rob:
I know, you were just like, \u201cAlex Hormozi.\u201d<\/p>\n

Mikey:
You know what I think? I think your name very\u2026 It fits your-<\/p>\n

David:
Boring personality?<\/p>\n

Mikey:
It fits your personality. Well, no, that\u2019s not\u2026 I wasn\u2019t going boring. No, I was going consistent, trustworthy, wise. I was actually going a different direction.<\/p>\n

David:
You know what you\u2019re going to get.<\/p>\n

Mikey:
I absolutely know what I\u2019m going to get. You\u2019re somebody that I could count on and I know if I would call, you\u2019d be there. I think that name represents that.<\/p>\n

David:
So having met me for the in person for the second time now, do you feel like the version of me that you hear in a podcast is the same as a version of me that you get in real life?<\/p>\n

Mikey:
100%. Yeah. Yep. You see what you get. That should be the motto behind your name. You see what you get.<\/p>\n

David:
You see what you get get. Unlike the other 23 Davids that came before me. The 24th David-<\/p>\n

Mikey:
You see what you get or you get what you see.<\/p>\n

Rob:
You get what you get, and you don\u2019t throw a fit.<\/p>\n

David:
I\u2019ve often wondered, is it you eat what you kill or you kill what you eat? I\u2019ve often wondered about that one too. I\u2019ve heard it both ways.<\/p>\n

Rob:
Don\u2019t do the crime if you can\u2019t do the time. That\u2019s what my dad always said.<\/p>\n

David:
That\u2019s what he said?<\/p>\n

Rob:
Mm-hmm. That\u2019s the only thing he ever said though. It was weird.<\/p>\n

Mikey:
My dad ran that too.<\/p>\n

David:
That was his favorite English phrase.<\/p>\n

Rob:
So if you want get David\u2019s foyer content, go over to Davidgreene24 and you can follow me over, @Robuilt on Threads, on Instagram, on YouTube and everything in between.<\/p>\n

David:
Check out our Threads, and are you on Threads, Mikey?<\/p>\n

Mikey:
I am.<\/p>\n

David:
All right. Go look at\u2026 What\u2019s your Thread?<\/p>\n

Mikey:
Mikey Taylor.<\/p>\n

David:
Mikey Taylor, Davidgreene24 and Robuilt, and let us know in the YouTube comments who has the most interesting Threads of the three of us. Not that it\u2019s a competition, we just want to hear from you guys.<\/p>\n

Rob:
But for the sake of this podcast, I guess it is.<\/p>\n

Mikey:
Rob\u2019s going to win this one before.<\/p>\n

David:
I don\u2019t know that you want to compete with a professional skateboarder in anything. Do you do skateboarding lessons? Can people reach out to you if they want to skate better?<\/p>\n

Mikey:
No, I don\u2019t. No, I don\u2019t.<\/p>\n

David:
Is there any videos of you skating through a vacant Kmart doing kickflips and what other skateboarding-<\/p>\n

Rob:
Well, that was your ad campaign when you were running for councilmen, right?<\/p>\n

Mikey:
No. No, we stayed away from that. No, but there are clips of me with other skaters doing tricks in the brewery before we pulled out.<\/p>\n

David:
Politics and skateboarding mesh wonderfully. There\u2019s never any animosity between those two groups, right?<\/p>\n

Mikey:
That\u2019s right. That\u2019s right.<\/p>\n

David:
Last question I want to ask you. We\u2019ve interviewed Rob Dyrdek on the show. Did you and him ever run into each other in your skateboarding careers?<\/p>\n

Mikey:
Rob Dyrdek is probably my biggest mentor throughout my whole career. Actually, going to a gala with him right after this.<\/p>\n

David:
Tell him that we said hi.<\/p>\n

Rob:
We\u2019ll be right there.<\/p>\n

Mikey:
Have you guys interviewed him yet?<\/p>\n

David:
Yeah, we just had him the show not too long ago.<\/p>\n

Mikey:
Rob is the man. Rob is the absolute man. He\u2019s been one of my closest friends since I was 16 years old. He completely mentored me through my career. He\u2019s been huge.<\/p>\n

Rob:
Ask him if he remembers doing the podcast.<\/p>\n

Mikey:
I will. I\u2019m going to see him seriously in an hour.<\/p>\n

David:
We should go to the gala. You like pretty things, that\u2019s all you ever talked about.<\/p>\n

Mikey:
I\u2019m going right, I got a suit and tie.<\/p>\n

Rob:
I\u2019ll go buy mine right now. I\u2019ll go to Men\u2019s Warehouse. You go in there with 500 bucks, you leave a king.<\/p>\n

David:
You see what I mean about this is the stuff he\u2019s good at.<\/p>\n

Mikey:
Rob Is the man. Yeah, rob is absolutely the man. Rob Dyrdek is my mentor through skateboarding, right? Rob does his show, Rob becomes an entrepreneur. Incredibly successful. I feel like I\u2019ve been chasing him my whole career and he just keeps setting the bar higher, right?<\/p>\n

David:
Yeah, he\u2019s the worst guy to chase. You\u2019re never going to catch that guy.<\/p>\n

Mikey:
I want to start my first business, Saint Archer, and me and Paul and Josh, my partners, and I was like, \u201cOkay, we\u2019re going to build this out. We\u2019re going to pitch this to Rob. Rob\u2019s going to be an investor. He loves us, he supports us.\u201d So we build out our business plan. We go to the Fantasy Factory, we pitch Rob on our idea. We\u2019re going to do this brewery. This is how we\u2019re going to market it. He\u2019s looking through the business plan and he looks at us and goes, \u201cYou\u2019re telling me other brands don\u2019t market. There\u2019s no marketing, there\u2019s no brand.\u201d We\u2019re like, \u201cYes,\u201d and he goes, \u201cYou\u2019re wrong.\u201d I\u2019m like, \u201cNo, dude. That\u2019s true.\u201d He goes, \u201cAbsolutely wrong.\u201d We\u2019re like, \u201cRob.\u201d He grabs the business plan, crumples it up, throws it into the trash and goes, \u201cDo not do this company. If you raise money from others, you\u2019re going to lose everybody\u2019s money.\u201d
Heartbroken. Heartbroken. We leave. I\u2019m so defeated. My fricking mentor just told me we shouldn\u2019t do it. Three and a half years later we sell it. He hits us up immediately, \u201cI\u2019m so proud of, you guys,\u201d et cetera. Fast-forward to a year ago, I talked to Rob. I\u2019m like, \u201cRob, it\u2019s time.\u201d He\u2019s like, \u201cWhat do you mean it\u2019s time?\u201d I\u2019m like, \u201cIt\u2019s time for us to have that talk about my company now, about you coming in as an investor,\u201d and he goes, \u201cLet\u2019s do it.\u201d So we have him scheduled for let\u2019s say a Thursday. Monday I\u2019m prepping the whole team. This guy is going to destroy us if we do not nail everything.<\/p>\n

David:
You kept that crumpled paper, it\u2019s framed on your office wall now.<\/p>\n

Mikey:
I was so hot, guys. I walked everyone through the pitch Monday, Tuesday, Wednesday, and basically it made everybody aware if we fumble it, he will destroy us. We get through the pitch on Thursday, hive him the whole deal. I\u2019m prepared. We finish. It\u2019s silent. Rob\u2019s looking. It was on Zoom. He\u2019s looking. He goes\u2026 Because Rob can be extra. And he goes, \u201cThat was one of the best pitches I\u2019ve ever heard. I love this. We\u2019re going to talk tomorrow.\u201d I hang up the phone, screaming in the office, \u201cWe did it.\u201d I was like one of those just the student lived up to the mentor. That was a fun experience. That was about a year ago.<\/p>\n

David:
But you\u2019re not done. You\u2019re not going to tell us what happened tomorrow.<\/p>\n

Mikey:
No. I can\u2019t.<\/p>\n

Rob:
That\u2019s the next podcast. That\u2019s for Patreon actually.<\/p>\n

Mikey:
I can\u2019t say the\u2026 Yeah.<\/p>\n

David:
According to your NDA, you\u2019re not allowed to say whatever happened from there.<\/p>\n

Rob:
Then you\u2019re going to say he crumbled it up and he was like, \u201cGoose.\u201d<\/p>\n

Mikey:
Yeah. So it ended up being a good meeting.<\/p>\n

David:
Okay, glad to hear that. If you guys want to hear more about Rob Dyrdek, his approach to life, how he fits a whole year into one day, check out BiggerPockets podcast episode 700.<\/p>\n

Rob:
Dude, it\u2019s so crazy how you memorized those.<\/p>\n

Mikey:
That was impressive.<\/p>\n

David:
That\u2019s the only reason they keep me around. It\u2019s not for my good looks.<\/p>\n

Rob:
That\u2019s nice. What was 692? Do you remember?<\/p>\n

David:
What was 692? Yeah, why are we going to take away from Mikey though? We\u2019re talking about Rob Dyrdek, his buddy, right now.<\/p>\n

Rob:
Now that is masterful. That is masterful.<\/p>\n

Mikey:
Do you tip a barista?<\/p>\n

David:
No. I have a theory that today you should only expend energy in areas where is appreciated and if tipping becomes expected, it is no longer appreciated, and now there\u2019s no ROI on my energy.<\/p>\n

Rob:
Now, Mikey, with that said, the iPad\u2019s going to ask you a quick question after you swipe your card, so here you go and we\u2019ll catch you on the next episode of the next episode of BiggerPockets and we\u2019ll catch you on the next one. We\u2019ll catch you on the next episode of BiggerPockets. David sign us off.<\/p>\n

David:
Thanks, Mikey.<\/p>\n

Mikey:
Thanks for having me.<\/p>\n

David:
This is David Greene for Rob \u201cShameless Plug\u201d Abasolo, signing off.<\/p>\n

\u00a0<\/p>\n<\/div>\n

Help us reach new listeners on iTunes by leaving us a rating and review! It takes just 30 seconds and instructions can be found here<\/a>. Thanks! We really appreciate it!<\/p>\n

Interested in learning more about today\u2019s sponsors or becoming a BiggerPockets partner yourself? Email <\/em>[email\u00a0protected]<\/span><\/em><\/a>.<\/em><\/p>\n

Recorded at Spotify Studios LA.<\/strong><\/p>\n

Note By BiggerPockets:<\/b> These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.<\/p>\n


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Cash flow \u201cmachines\u201d is how Mikey Taylor describes his most recent investments. To the non-investors, the numbers seem too good to be true. But Mikey has repeated this system, again and again, to make millions of dollars off of \u201cboring\u201d investments that most investors overlook. What \u201ccash machines\u201d is Mikey referring to, and how do […]<\/p>\n","protected":false},"author":5,"featured_media":9200,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"fifu_image_url":"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2023\/09\/REP_818_WEB.jpg","fifu_image_alt":"","footnotes":""},"categories":[9],"tags":[],"class_list":["post-9199","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"_links":{"self":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/9199","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/comments?post=9199"}],"version-history":[{"count":1,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/9199\/revisions"}],"predecessor-version":[{"id":9201,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/posts\/9199\/revisions\/9201"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/media\/9200"}],"wp:attachment":[{"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/media?parent=9199"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/categories?post=9199"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/imsfund.com\/index.php\/wp-json\/wp\/v2\/tags?post=9199"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}