September 16, 2025 • 19 mins
Luca and Mat have built a rental portfolio by repeatedly buying condos in the same complex. They know the floor plans, understand the values, and can move quickly when a new unit hits the market, giving them a huge advantage over other buyers.
A new train line is being built nearby, drastically reducing the commute time to the city center. Luca and Mat believe the neighborhood is poised for growth once the station opens, and they’ve been buying aggressively in anticipation of rising property values and rents.
On this episode, they share how they spotted the opportunity early, what signs they look for when investing in the path of progress, and how you can identify similar trends in your own market.
We also discuss their mission-driven strategy of renting to disabled military veterans and how it’s made a difference in their business and their community.
https://rentalincomepodcast.com/episode539
Thanks To Our Sponsors:
Ridge Lending Group - Making investment Mortgage process simple and stress-free.
MidSouth HomeBuyers – Turnkey Rentals In Memphis & Little Rock. Instant Cash Flow On Day One. (Priced between $100,000 to low $200's)
Rental Accounting Software Made Easy. Free 30 Day Trial
A new train line is being built nearby, drastically reducing the commute time to the city center. Luca and Mat believe the neighborhood is poised for growth once the station opens, and they’ve been buying aggressively in anticipation of rising property values and rents.
On this episode, they share how they spotted the opportunity early, what signs they look for when investing in the path of progress, and how you can identify similar trends in your own market.
We also discuss their mission-driven strategy of renting to disabled military veterans and how it’s made a difference in their business and their community.
https://rentalincomepodcast.com/episode539
Thanks To Our Sponsors:
Ridge Lending Group - Making investment Mortgage process simple and stress-free.
MidSouth HomeBuyers – Turnkey Rentals In Memphis & Little Rock. Instant Cash Flow On Day One. (Priced between $100,000 to low $200's)
Rental Accounting Software Made Easy. Free 30 Day Trial
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
The inspiring interviews with today is Top Landlords. This is
the Rental Income podcast and now.
Speaker 2 (00:08):
Damnly, a great way to make money in real estate
is to buy in an area that's getting better. Maybe
there's some kind of improvement going on, some development, or
the area is just getting better over time. And Luca,
that's what you're doing. You're buying in an area where
a brand new train station is being built.
Speaker 3 (00:27):
And the reason we're buying here is because along this
same neighborhood on the opposite side, on the northern side,
they're building an actual train station for the Metro North
which will take nineteen minutes to take you to the
center of the city. So it's going to overnight turn
(00:47):
from a sixty minute commute to the center of the
city to a twenty minute commute to the center of
the city.
Speaker 1 (00:53):
So you know, it's not rocket science.
Speaker 3 (00:55):
We're just sitting here while the government pours a billion
dollars of infrastructure tax money into making our assets more desirable,
more accessible, without us having to really do anything.
Speaker 2 (01:06):
No doubt that when that train station opens up, rents
are going to be higher, the value of their properties
are going to go up. And on the podcast today,
Luca and his partner Matt are going to share some
tips on how you can find a property in the
path of progress where there's some kind of development going
on that's going to lead to properties going up in value.
(01:27):
We'll also talk about how Luca and Matt are getting
guaranteed rent by renting to veterans, and why they think
condos are actually a really good investment. Joining us on
the podcast today from Bronx New York are Luca Ganaci
and Matt Rodgers. Will take a quick break to bank
our sponsors. We'll come right back and we'll talk to
(01:48):
Luca and Matt. It's a lot of work to find
a really good rental property, and when you actually find
that property, you want to make sure you're working with
a lender that can get that loan closed. The lender
that I recommend is chain Lee Ridge from Ridge Lending Group.
She's a nationwide lender and her specialty is helping investors
finance rental properties. She has a ton of loan programs
(02:10):
and she can find something customized to you for your situation.
If you want to find out more or you're ready
to get started today, just go to Ridge Lendinggroup dot com.
That's our Idge Lendinggroup dot com and MLS four two
zero five six. Are you thinking about investing in rental
properties but maybe you don't know where to start. My
(02:31):
friends at Midsouth home Buyers make it simple. For over
twenty three years, they've been selling fully renovated, turnkey rental
properties in Memphis and Little Rock. We're talking new roofs, plumbing, electric, kitchens, bathrooms.
Everything is brand new and done right. And here's the
best part. Every property comes with a well qualified tenant
(02:54):
in place before you close. That means you get cash
flow from day one plus and it South continues to
professionally manage the property for you after the sale, and
they back it up with two powerful guarantees. You get
a one year total maintenance warranty and a lifetime occupancy guarantee. Personally,
(03:15):
I've bought five properties from them and I couldn't be happier.
If you want to talk to someone that's been through
the process, feel free to reach out to me. I'm
happy to answer any questions or if you're ready to
get started, just go to midsouthhome Buyers dot com. That's
midsouthhome Buyers dot com. Luca Let's start off talking about
your portfolio. What are your rentals like?
Speaker 3 (03:38):
So I have a cute little portfolio of fifty one units,
all owned by myself with various LLCs. They're all one
bedroom or two bedroom condominium apartments in this massive one
hundred and seventy one tower, thirteen thousand unit condominium called Parkchester,
(03:59):
and both myself and Matt we we exclusively rent our
properties to former military personnel, to to veterans, typically disabled
elderly veterans, and they're either fully or almost fully subsidized
under the hut VASH program.
Speaker 1 (04:20):
Which is a subset of Section.
Speaker 3 (04:21):
Eight which most of your viewers will be familiar with,
which deals exclusively with veterans. So it's it's I often
compare it to flying first class versus flying coach. You
still get to the same destination, but it's just so
much better the you know, the it's just more funding
when when the Pentagon is involved and the clients get
(04:44):
the tenants get great customer care. We we get the
attention of the housing authority quite easily, and problems tend
to be smoothed out quite well whenever and whenever they
show up.
Speaker 2 (04:55):
So are you guys buying everything together or do you
have separate portfolio.
Speaker 1 (05:00):
So we have an all of the above approach.
Speaker 3 (05:06):
I have my personal portfolio, Matt has his personal portfolio,
and then we do a bunch of deals together. We
facilitate transactions for friends and family. You also want to
get in and yeah, so the best way to describe
it as an all of the above situation.
Speaker 2 (05:22):
And everything is in one building. So it's like a
high rise building and all your properties are in that
one building.
Speaker 3 (05:33):
No, it's actually it's a single condominium. But it's one
hundred and seventy one towers, it's one hundred and seventy
one buildings.
Speaker 1 (05:43):
It's massive.
Speaker 3 (05:44):
It was coined when it was built in the nineteen
forties as a city within a city. It has its
own private police, it has its own infrastructure. There's a
beautiful fountain in the middle of it if people want
to google it. So it's all under the same administration.
They have one hundred million dollars in reserves, excellent finances,
and so you know, we might own a a half
(06:07):
dozen apartments in one building, a half dozen in another.
They're kind of peppered across the neighborhood slash complex.
Speaker 2 (06:15):
So it sounds like you're buying that this same basically
the same condo over and over and over again.
Speaker 3 (06:22):
Yes, there there's a there's a lot of uniformity in
the asset. There's basically you know, floor plan A floor
plan B mirror image of a mirror image of B,
and then the same for the two bedrooms also.
Speaker 1 (06:36):
So so it's it's quite easy. Uh you know, they're not.
Let me let me put it this way.
Speaker 3 (06:43):
If you were trying to buy and sell fancy, architecturally interesting,
uh unique Tribeca loft, each transaction will be its own
separate thing, with its own separate set of due diligence
you would have to do. Whereas here, you know, we
we buy you know, four or five or six a month,
because each transaction is basically a duplicate of the last one.
(07:07):
You know, we you know, we know the finance, so
we don't have to reread the by laws of the
condo each time.
Speaker 1 (07:12):
You know, we as I'm on.
Speaker 3 (07:14):
The board of directors of you know, of the of
the condo we buy in.
Speaker 2 (07:18):
Yeah, I mean I think that that that's really an
interesting way to do it, because you know the prices,
you know what a good deal is, you know, what
it's going to rent for. You're not having to do
any kind of analysis when you're looking to buy a place,
so it just seems simple to just keep doing it
over and over and over again.
Speaker 4 (07:40):
Yeah, exactly. It makes it really easy. We're in this
day in day out, in this market. We know exactly
what the rates are, what the rents is, what the
rent is, what the prices are going for. We always
try to buy below market, and that's how we can
find about I would say, on average eight eight units
per month that are for us below market if we
(08:02):
would like to buy more. Typically the units that we're
finding above those eight are at or above market. But
it really helps you to know the product through and through.
Speaker 2 (08:15):
Now, look at you sent me over a spreadsheet of
your property, so you've got everything laid out so organized.
And one thing that I noticed is that you bought
your first property and then there was a long time
before you bought your second property. What what?
Speaker 3 (08:37):
What?
Speaker 2 (08:37):
What made you wait so long to buy your second property.
Speaker 3 (08:41):
The very first property I bought was before, uh, the
new train station was announced, and this, you know, enormously
important change in the circumstances here.
Speaker 1 (08:54):
I just bought the first.
Speaker 3 (08:55):
One because I figured I should do something with real estate.
I wasn't doing it full time at all, and I
basically put probably ninety five percent of my net worth
into buying that first property for eighty five K. And
then I started buying heavily subsequent to that. When the
train was announced, when the train station was announced, is
when you know, truly, you know, we started. We realized
(09:20):
what we were sitting on, and that's when the heavy
purchasing started, and the partnerships and the additional investors and
so on and so forth.
Speaker 2 (09:27):
Are there any signs that that someone could look for
if they're, you know, looking to buy a property that's
in the path of progress where something good might be
coming down the road. Are there any signs that that
someone can look for?
Speaker 3 (09:42):
Of course, the easiest indicator is just follow the money.
Find out where the federal government is allocating billions of
dollars billions of tax dollars in infrastructure projects, and buy there.
It doesn't have to be right next to a new
train station. It could be right next to anything like
(10:03):
a port, a new highway being built, anything where you
don't like. As I sit here right now, I'm in
the Italian Alps, I'm having a wonderful hike, and there
are some two hundred and fifty union workers in the
Bronx building a train station for me and changing the
circumstances so fundamentally without me having to do anything. The
(10:25):
maximized capitalization won't be because I'll have put in a
new kitchen or a new bathroom. It will be because
of the convenience created by this external element, government funded
infrastructure improvements.
Speaker 2 (10:38):
So have you seen the values go up already or
is it like, do you think that's going to come
when the actual train is open?
Speaker 3 (10:48):
Nine point four four percent per year in average growth
off of my portfolio alone and the portfolio of partners.
It's there's yes. Matt was mentioning earlier that the numbers
make sense even without the train. This is an incredibly
well managed, multi multi tower condominium complex on the outskirts
(11:09):
of you know, the cultural and financial capital of the
Western world.
Speaker 1 (11:15):
Uh, it's safe.
Speaker 3 (11:16):
It's the crime rate is lower than in the zip
code of the Empire State building. So yes, documented irrefutable,
objectively verified growth almost almost double digit consistently over the
last decade and a half. So so I we believe
that that that the arrival of the train station will
(11:39):
put the growth in overdrive. But yes, it's definitely present.
It's it's it's quite common to New York. There's always
you know, right now it's Bushwick and Brooklyn. You know,
there was a time that it was Alphabet City in
Manhattan that was just full of addicts and very dangerous,
and then it was kind of reborn and there seemed
to be the new hot spot.
Speaker 1 (11:59):
In in New York. And it's the Bronx's turn next.
Speaker 3 (12:03):
So it's definitely a solid investment, and it would be
even without this extra bonus. The cherry on top of
that matter was mentioning.
Speaker 2 (12:10):
Now, talk to me about the condo fee. That's something
with condos that always kind of freaks me out because
those condo fees can be expensive. Are the condo fees
pretty high in your area?
Speaker 3 (12:25):
This is, as I mentioned, an enormous condominium complex. It
has more than one hundred million dollars in reserves, and
it's investing here has been an amazing experience, and interfacing
and interacting with the condominium itself and the HOA management
has been delightful because of how well run it is
(12:45):
and because of economies of scale, you know, if you
have a single tower condominium anywhere, even in Manhattan, and
all of a sudden the elevator breaks and needs to
be replaced, it's a tragedy. It's a major assessed and
tens of thousands of dollars you need to be chipped
in by each owner. People sue, people sell below value
and crash the value of the building.
Speaker 1 (13:07):
It's a disaster.
Speaker 3 (13:08):
If an elevator breaks in Parkchester, it's a Tuesday. You know,
we have two hundred elevator shafts. Something is going to break.
We have on site staff that does nothing but elevator repair,
and they're included in the budget. They're not a deviation
from the budget. And you know that the elevator is
(13:28):
just an example. They're they're making all the building entrances
ADA compliant. They're reinforcing the you know, the roofs of
the building because they're somewhat old. And all of these
events are on a ten year, fifteen or twenty year
rotation to go through all one hundred and seventy one towers,
and so they're included in budgets. We know ahead of
time that in five years from now we'll spend x
(13:50):
amount of money on replacing the elevators in this building,
this building, in that building.
Speaker 1 (13:55):
So it's it's extremely stable.
Speaker 3 (14:01):
The HOA grows about three percent per year and there's
barely any deviation from that.
Speaker 1 (14:07):
It's truly just tied to inflation.
Speaker 2 (14:10):
Yeah, that's interesting. So would you say that you're if
you're gonna buy a condo, you know, most condos aren't
going to be as big as the project that you
guys are investing in, but maybe try to find a
bigger condo than a smaller unit because you have that scale.
Speaker 3 (14:30):
Yes, I would say, I mean, really look if you're
going to buy into a condo, really look into the finances.
Speaker 1 (14:35):
Of the condo.
Speaker 3 (14:36):
This is like an extreme case of an extra.
Speaker 1 (14:41):
Called a comfort blanket that all the owners feel.
Speaker 3 (14:46):
It's kind of like on the opposite side of the
spectrum from buying a I don't know, a two family house.
You know, if the boiler breaks, that's on you. If
the roof breaks, that's on you. If all of these
things break in one of my condos, I not only
do I not have to worry about it on a
month to month basis any kind of like additional expense,
but I know it won't affect the increase that will
happen the next year. They're not going to have to
jack up be increased anymore because of whatever might have broken.
(15:09):
It's just all baked into the cake, right.
Speaker 2 (15:11):
And now the other advantage to a condo, I think
is that it's just simple like there you're only responsible
for inside the walls, inside the unit. So are your
maintenance fees or the amount that you spend on maintenance,
are they small just because it's probably really just kind
(15:33):
of appliances that that you're having to maintain.
Speaker 3 (15:37):
Yes, appliances, the occasional paint job, the kind of routine stuff.
Sometimes you have to change the carpet. Yeah, if there's
a leak from the bathroom above, and there will be
because you know, they're nineteen year old pipes.
Speaker 1 (15:51):
The condominium takes care of all the repair.
Speaker 3 (15:52):
We just have to put the last code of paint
and so you know, the you know, the fees are
about you know, are a little high. They're about eight
hundred dollars for a one bedroom, maybe one thousand dollars
for a two bedroom. But again we rent our properties
for twenty six hundred dollars in change, and that amount
is guaranteed by the government and is paid directly by
(16:13):
the government, so our cash flow is is phenomenal.
Speaker 2 (16:18):
Tell me about the tenants that you're renting to, So
you're you're targeting veterans.
Speaker 3 (16:23):
Yes, yes, And there's two reasons for that. On the
one hand, it's just the right thing to do. It's
wonderful that you know, there's you know, people that would
you know that have served their country in uniform and
then they fall on hard times, they need they need help,
and we provide a home. And we like to think
(16:43):
of our property management mantra is we're like a five
star hotel with really low budget.
Speaker 1 (16:51):
So the intention is there.
Speaker 3 (16:52):
We really try to make the you know, our tenants
feel welcome and we're really proud to be able to help.
And on the other hand, we are interfacing with the Pentagon,
with the Department of Defense, with a really well funded institution,
a really well operated institution.
Speaker 1 (17:10):
So the customer care is.
Speaker 3 (17:12):
Available is really phenomenal. The process is made simple. The
typical Section eight will take two three four months to process,
at least in New York. If you're doing hut vash,
which is what this program is called, within two weeks
it's your operational you know, we have the cell phones
(17:32):
of the of the Nischa operators, of the people that
administer the voucher.
Speaker 1 (17:37):
It's just it's just like.
Speaker 3 (17:39):
Working with another small business. It's that level of access,
that level of efficiency.
Speaker 1 (17:46):
It's pretty wonderful.
Speaker 3 (17:47):
If if you're going to rent to anybody, try to
rent to veterans.
Speaker 2 (17:50):
So do you think this is maybe better than Section eight?
Speaker 3 (17:54):
It's Section eight on steroids. If Section eight is flying coach,
this is a flying first gets you to the same destination.
You're the same program. It's still the government paying you.
But there is the there is the VA supplement to
the to the general program, which you know puts in
an overdrive. We almost never have to evict Section eight
(18:16):
tenants or had VASH tenants, But in the rare cases
that we do have to, the government keeps paying the
rent okay, so we're not losing money. We just have
to pay five hundred dollars to do it for the
lawyer to show up in court. But our cash flow
is fine. I had this one tenant, a former marine
who one day disappeared.
Speaker 1 (18:36):
To this day, I don't know where he went. He
just left. I don't know the city, the country. I
don't know.
Speaker 3 (18:40):
And obviously you can't just take back an apartment. You
still have to go through the process and so, you know, yeah,
we have to go six months waiting for court dates
and what have you. And during that entire time, I
was getting all of the money from the government, and
so it was basically business as usual without the you know,
without having to deal with the tenant being there.
Speaker 2 (18:57):
Luca and Natt tell me there's lots of opportunities in
their development. If anyone wants to reach out to them
to get some more information, I've got their contact information
on the website. You can find it at Rental Incomepodcast
dot com slash episode five thirty nine. I'd like to
thank Chailey Ridge from Ridge Lending Group for sponsoring today's episode.
(19:19):
If you're looking to buy a rental property, whether you're
just getting started or you want to add to your portfolio,
reach out to Chailey right now. She's offering a free
thirty minute strategy session. If you want to sign up
for that, just go to Ridge Lendinggroup dot com and
MLS four two zero five six. Thank you so much
(19:39):
for checking out the podcast today. Make sure you hit
that follow though button I put out a new interview
every single Tuesday, and if you're following the show, you'll
get notified when the next episode comes out. My name
is Dan Lane and this has been the Rental Income
podcast
The inspiring interviews with today is Top Landlords. This is
the Rental Income podcast and now.
Speaker 2 (00:08):
Damnly, a great way to make money in real estate
is to buy in an area that's getting better. Maybe
there's some kind of improvement going on, some development, or
the area is just getting better over time. And Luca,
that's what you're doing. You're buying in an area where
a brand new train station is being built.
Speaker 3 (00:27):
And the reason we're buying here is because along this
same neighborhood on the opposite side, on the northern side,
they're building an actual train station for the Metro North
which will take nineteen minutes to take you to the
center of the city. So it's going to overnight turn
(00:47):
from a sixty minute commute to the center of the
city to a twenty minute commute to the center of
the city.
Speaker 1 (00:53):
So you know, it's not rocket science.
Speaker 3 (00:55):
We're just sitting here while the government pours a billion
dollars of infrastructure tax money into making our assets more desirable,
more accessible, without us having to really do anything.
Speaker 2 (01:06):
No doubt that when that train station opens up, rents
are going to be higher, the value of their properties
are going to go up. And on the podcast today,
Luca and his partner Matt are going to share some
tips on how you can find a property in the
path of progress where there's some kind of development going
on that's going to lead to properties going up in value.
(01:27):
We'll also talk about how Luca and Matt are getting
guaranteed rent by renting to veterans, and why they think
condos are actually a really good investment. Joining us on
the podcast today from Bronx New York are Luca Ganaci
and Matt Rodgers. Will take a quick break to bank
our sponsors. We'll come right back and we'll talk to
(01:48):
Luca and Matt. It's a lot of work to find
a really good rental property, and when you actually find
that property, you want to make sure you're working with
a lender that can get that loan closed. The lender
that I recommend is chain Lee Ridge from Ridge Lending Group.
She's a nationwide lender and her specialty is helping investors
finance rental properties. She has a ton of loan programs
(02:10):
and she can find something customized to you for your situation.
If you want to find out more or you're ready
to get started today, just go to Ridge Lendinggroup dot com.
That's our Idge Lendinggroup dot com and MLS four two
zero five six. Are you thinking about investing in rental
properties but maybe you don't know where to start. My
(02:31):
friends at Midsouth home Buyers make it simple. For over
twenty three years, they've been selling fully renovated, turnkey rental
properties in Memphis and Little Rock. We're talking new roofs, plumbing, electric, kitchens, bathrooms.
Everything is brand new and done right. And here's the
best part. Every property comes with a well qualified tenant
(02:54):
in place before you close. That means you get cash
flow from day one plus and it South continues to
professionally manage the property for you after the sale, and
they back it up with two powerful guarantees. You get
a one year total maintenance warranty and a lifetime occupancy guarantee. Personally,
(03:15):
I've bought five properties from them and I couldn't be happier.
If you want to talk to someone that's been through
the process, feel free to reach out to me. I'm
happy to answer any questions or if you're ready to
get started, just go to midsouthhome Buyers dot com. That's
midsouthhome Buyers dot com. Luca Let's start off talking about
your portfolio. What are your rentals like?
Speaker 3 (03:38):
So I have a cute little portfolio of fifty one units,
all owned by myself with various LLCs. They're all one
bedroom or two bedroom condominium apartments in this massive one
hundred and seventy one tower, thirteen thousand unit condominium called Parkchester,
(03:59):
and both myself and Matt we we exclusively rent our
properties to former military personnel, to to veterans, typically disabled
elderly veterans, and they're either fully or almost fully subsidized
under the hut VASH program.
Speaker 1 (04:20):
Which is a subset of Section.
Speaker 3 (04:21):
Eight which most of your viewers will be familiar with,
which deals exclusively with veterans. So it's it's I often
compare it to flying first class versus flying coach. You
still get to the same destination, but it's just so
much better the you know, the it's just more funding
when when the Pentagon is involved and the clients get
(04:44):
the tenants get great customer care. We we get the
attention of the housing authority quite easily, and problems tend
to be smoothed out quite well whenever and whenever they
show up.
Speaker 2 (04:55):
So are you guys buying everything together or do you
have separate portfolio.
Speaker 1 (05:00):
So we have an all of the above approach.
Speaker 3 (05:06):
I have my personal portfolio, Matt has his personal portfolio,
and then we do a bunch of deals together. We
facilitate transactions for friends and family. You also want to
get in and yeah, so the best way to describe
it as an all of the above situation.
Speaker 2 (05:22):
And everything is in one building. So it's like a
high rise building and all your properties are in that
one building.
Speaker 3 (05:33):
No, it's actually it's a single condominium. But it's one
hundred and seventy one towers, it's one hundred and seventy
one buildings.
Speaker 1 (05:43):
It's massive.
Speaker 3 (05:44):
It was coined when it was built in the nineteen
forties as a city within a city. It has its
own private police, it has its own infrastructure. There's a
beautiful fountain in the middle of it if people want
to google it. So it's all under the same administration.
They have one hundred million dollars in reserves, excellent finances,
and so you know, we might own a a half
(06:07):
dozen apartments in one building, a half dozen in another.
They're kind of peppered across the neighborhood slash complex.
Speaker 2 (06:15):
So it sounds like you're buying that this same basically
the same condo over and over and over again.
Speaker 3 (06:22):
Yes, there there's a there's a lot of uniformity in
the asset. There's basically you know, floor plan A floor
plan B mirror image of a mirror image of B,
and then the same for the two bedrooms also.
Speaker 1 (06:36):
So so it's it's quite easy. Uh you know, they're not.
Let me let me put it this way.
Speaker 3 (06:43):
If you were trying to buy and sell fancy, architecturally interesting,
uh unique Tribeca loft, each transaction will be its own
separate thing, with its own separate set of due diligence
you would have to do. Whereas here, you know, we
we buy you know, four or five or six a month,
because each transaction is basically a duplicate of the last one.
(07:07):
You know, we you know, we know the finance, so
we don't have to reread the by laws of the
condo each time.
Speaker 1 (07:12):
You know, we as I'm on.
Speaker 3 (07:14):
The board of directors of you know, of the of
the condo we buy in.
Speaker 2 (07:18):
Yeah, I mean I think that that that's really an
interesting way to do it, because you know the prices,
you know what a good deal is, you know, what
it's going to rent for. You're not having to do
any kind of analysis when you're looking to buy a place,
so it just seems simple to just keep doing it
over and over and over again.
Speaker 4 (07:40):
Yeah, exactly. It makes it really easy. We're in this
day in day out, in this market. We know exactly
what the rates are, what the rents is, what the
rent is, what the prices are going for. We always
try to buy below market, and that's how we can
find about I would say, on average eight eight units
per month that are for us below market if we
(08:02):
would like to buy more. Typically the units that we're
finding above those eight are at or above market. But
it really helps you to know the product through and through.
Speaker 2 (08:15):
Now, look at you sent me over a spreadsheet of
your property, so you've got everything laid out so organized.
And one thing that I noticed is that you bought
your first property and then there was a long time
before you bought your second property. What what?
Speaker 3 (08:37):
What?
Speaker 2 (08:37):
What made you wait so long to buy your second property.
Speaker 3 (08:41):
The very first property I bought was before, uh, the
new train station was announced, and this, you know, enormously
important change in the circumstances here.
Speaker 1 (08:54):
I just bought the first.
Speaker 3 (08:55):
One because I figured I should do something with real estate.
I wasn't doing it full time at all, and I
basically put probably ninety five percent of my net worth
into buying that first property for eighty five K. And
then I started buying heavily subsequent to that. When the
train was announced, when the train station was announced, is
when you know, truly, you know, we started. We realized
(09:20):
what we were sitting on, and that's when the heavy
purchasing started, and the partnerships and the additional investors and
so on and so forth.
Speaker 2 (09:27):
Are there any signs that that someone could look for
if they're, you know, looking to buy a property that's
in the path of progress where something good might be
coming down the road. Are there any signs that that
someone can look for?
Speaker 3 (09:42):
Of course, the easiest indicator is just follow the money.
Find out where the federal government is allocating billions of
dollars billions of tax dollars in infrastructure projects, and buy there.
It doesn't have to be right next to a new
train station. It could be right next to anything like
(10:03):
a port, a new highway being built, anything where you
don't like. As I sit here right now, I'm in
the Italian Alps, I'm having a wonderful hike, and there
are some two hundred and fifty union workers in the
Bronx building a train station for me and changing the
circumstances so fundamentally without me having to do anything. The
(10:25):
maximized capitalization won't be because I'll have put in a
new kitchen or a new bathroom. It will be because
of the convenience created by this external element, government funded
infrastructure improvements.
Speaker 2 (10:38):
So have you seen the values go up already or
is it like, do you think that's going to come
when the actual train is open?
Speaker 3 (10:48):
Nine point four four percent per year in average growth
off of my portfolio alone and the portfolio of partners.
It's there's yes. Matt was mentioning earlier that the numbers
make sense even without the train. This is an incredibly
well managed, multi multi tower condominium complex on the outskirts
(11:09):
of you know, the cultural and financial capital of the
Western world.
Speaker 1 (11:15):
Uh, it's safe.
Speaker 3 (11:16):
It's the crime rate is lower than in the zip
code of the Empire State building. So yes, documented irrefutable,
objectively verified growth almost almost double digit consistently over the
last decade and a half. So so I we believe
that that that the arrival of the train station will
(11:39):
put the growth in overdrive. But yes, it's definitely present.
It's it's it's quite common to New York. There's always
you know, right now it's Bushwick and Brooklyn. You know,
there was a time that it was Alphabet City in
Manhattan that was just full of addicts and very dangerous,
and then it was kind of reborn and there seemed
to be the new hot spot.
Speaker 1 (11:59):
In in New York. And it's the Bronx's turn next.
Speaker 3 (12:03):
So it's definitely a solid investment, and it would be
even without this extra bonus. The cherry on top of
that matter was mentioning.
Speaker 2 (12:10):
Now, talk to me about the condo fee. That's something
with condos that always kind of freaks me out because
those condo fees can be expensive. Are the condo fees
pretty high in your area?
Speaker 3 (12:25):
This is, as I mentioned, an enormous condominium complex. It
has more than one hundred million dollars in reserves, and
it's investing here has been an amazing experience, and interfacing
and interacting with the condominium itself and the HOA management
has been delightful because of how well run it is
(12:45):
and because of economies of scale, you know, if you
have a single tower condominium anywhere, even in Manhattan, and
all of a sudden the elevator breaks and needs to
be replaced, it's a tragedy. It's a major assessed and
tens of thousands of dollars you need to be chipped
in by each owner. People sue, people sell below value
and crash the value of the building.
Speaker 1 (13:07):
It's a disaster.
Speaker 3 (13:08):
If an elevator breaks in Parkchester, it's a Tuesday. You know,
we have two hundred elevator shafts. Something is going to break.
We have on site staff that does nothing but elevator repair,
and they're included in the budget. They're not a deviation
from the budget. And you know that the elevator is
(13:28):
just an example. They're they're making all the building entrances
ADA compliant. They're reinforcing the you know, the roofs of
the building because they're somewhat old. And all of these
events are on a ten year, fifteen or twenty year
rotation to go through all one hundred and seventy one towers,
and so they're included in budgets. We know ahead of
time that in five years from now we'll spend x
(13:50):
amount of money on replacing the elevators in this building,
this building, in that building.
Speaker 1 (13:55):
So it's it's extremely stable.
Speaker 3 (14:01):
The HOA grows about three percent per year and there's
barely any deviation from that.
Speaker 1 (14:07):
It's truly just tied to inflation.
Speaker 2 (14:10):
Yeah, that's interesting. So would you say that you're if
you're gonna buy a condo, you know, most condos aren't
going to be as big as the project that you
guys are investing in, but maybe try to find a
bigger condo than a smaller unit because you have that scale.
Speaker 3 (14:30):
Yes, I would say, I mean, really look if you're
going to buy into a condo, really look into the finances.
Speaker 1 (14:35):
Of the condo.
Speaker 3 (14:36):
This is like an extreme case of an extra.
Speaker 1 (14:41):
Called a comfort blanket that all the owners feel.
Speaker 3 (14:46):
It's kind of like on the opposite side of the
spectrum from buying a I don't know, a two family house.
You know, if the boiler breaks, that's on you. If
the roof breaks, that's on you. If all of these
things break in one of my condos, I not only
do I not have to worry about it on a
month to month basis any kind of like additional expense,
but I know it won't affect the increase that will
happen the next year. They're not going to have to
jack up be increased anymore because of whatever might have broken.
(15:09):
It's just all baked into the cake, right.
Speaker 2 (15:11):
And now the other advantage to a condo, I think
is that it's just simple like there you're only responsible
for inside the walls, inside the unit. So are your
maintenance fees or the amount that you spend on maintenance,
are they small just because it's probably really just kind
(15:33):
of appliances that that you're having to maintain.
Speaker 3 (15:37):
Yes, appliances, the occasional paint job, the kind of routine stuff.
Sometimes you have to change the carpet. Yeah, if there's
a leak from the bathroom above, and there will be
because you know, they're nineteen year old pipes.
Speaker 1 (15:51):
The condominium takes care of all the repair.
Speaker 3 (15:52):
We just have to put the last code of paint
and so you know, the you know, the fees are
about you know, are a little high. They're about eight
hundred dollars for a one bedroom, maybe one thousand dollars
for a two bedroom. But again we rent our properties
for twenty six hundred dollars in change, and that amount
is guaranteed by the government and is paid directly by
(16:13):
the government, so our cash flow is is phenomenal.
Speaker 2 (16:18):
Tell me about the tenants that you're renting to, So
you're you're targeting veterans.
Speaker 3 (16:23):
Yes, yes, And there's two reasons for that. On the
one hand, it's just the right thing to do. It's
wonderful that you know, there's you know, people that would
you know that have served their country in uniform and
then they fall on hard times, they need they need help,
and we provide a home. And we like to think
(16:43):
of our property management mantra is we're like a five
star hotel with really low budget.
Speaker 1 (16:51):
So the intention is there.
Speaker 3 (16:52):
We really try to make the you know, our tenants
feel welcome and we're really proud to be able to help.
And on the other hand, we are interfacing with the Pentagon,
with the Department of Defense, with a really well funded institution,
a really well operated institution.
Speaker 1 (17:10):
So the customer care is.
Speaker 3 (17:12):
Available is really phenomenal. The process is made simple. The
typical Section eight will take two three four months to process,
at least in New York. If you're doing hut vash,
which is what this program is called, within two weeks
it's your operational you know, we have the cell phones
(17:32):
of the of the Nischa operators, of the people that
administer the voucher.
Speaker 1 (17:37):
It's just it's just like.
Speaker 3 (17:39):
Working with another small business. It's that level of access,
that level of efficiency.
Speaker 1 (17:46):
It's pretty wonderful.
Speaker 3 (17:47):
If if you're going to rent to anybody, try to
rent to veterans.
Speaker 2 (17:50):
So do you think this is maybe better than Section eight?
Speaker 3 (17:54):
It's Section eight on steroids. If Section eight is flying coach,
this is a flying first gets you to the same destination.
You're the same program. It's still the government paying you.
But there is the there is the VA supplement to
the to the general program, which you know puts in
an overdrive. We almost never have to evict Section eight
(18:16):
tenants or had VASH tenants, But in the rare cases
that we do have to, the government keeps paying the
rent okay, so we're not losing money. We just have
to pay five hundred dollars to do it for the
lawyer to show up in court. But our cash flow
is fine. I had this one tenant, a former marine
who one day disappeared.
Speaker 1 (18:36):
To this day, I don't know where he went. He
just left. I don't know the city, the country. I
don't know.
Speaker 3 (18:40):
And obviously you can't just take back an apartment. You
still have to go through the process and so, you know, yeah,
we have to go six months waiting for court dates
and what have you. And during that entire time, I
was getting all of the money from the government, and
so it was basically business as usual without the you know,
without having to deal with the tenant being there.
Speaker 2 (18:57):
Luca and Natt tell me there's lots of opportunities in
their development. If anyone wants to reach out to them
to get some more information, I've got their contact information
on the website. You can find it at Rental Incomepodcast
dot com slash episode five thirty nine. I'd like to
thank Chailey Ridge from Ridge Lending Group for sponsoring today's episode.
(19:19):
If you're looking to buy a rental property, whether you're
just getting started or you want to add to your portfolio,
reach out to Chailey right now. She's offering a free
thirty minute strategy session. If you want to sign up
for that, just go to Ridge Lendinggroup dot com and
MLS four two zero five six. Thank you so much
(19:39):
for checking out the podcast today. Make sure you hit
that follow though button I put out a new interview
every single Tuesday, and if you're following the show, you'll
get notified when the next episode comes out. My name
is Dan Lane and this has been the Rental Income
podcast
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