Discover the allure of resort-grade amenities and higher revenue potential in nightly rental markets—could this be your next investment move? Wayne and Dallin Aston are back for another session at Aston Incorporated, where we peel back the layers of the real estate sector. From the charm of a 100-unit nightly rental to the diverse classes of multifamily apartments, we dissect the financial dynamics and emotional reasons that influence our choices in property investments. If you're looking to understand how deal quality impacts profit margins or why locations like Moab, Utah, are a goldmine for savvy investors, you've come to the right place.
Ever wonder what distinguishes a forgettable stay from an unforgettable experience? We reveal the secret sauce behind memorable Airbnb rentals, highlighting the fine line between generic accommodation and an authentic, personal touch that brings guests back time and again. We take you behind the scenes, exploring how independent owners can implement thoughtfully designed spaces and strategic amenities to carve out a niche in today's authenticity-hungry travel market. You'll be inspired to think differently about how to present your rental in a way that truly stands out from the crowd.
In a world where the bottom line often takes center stage, we argue that leading with love in business culture can be a true game-changer. This episode not just talks about love as a business strategy, but demonstrates how a culture of abundance and genuine customer care can elevate every aspect of the real estate experience. We wrap up our foundational real estate series with a heartfelt thank you to our listeners and a sneak peek at what's to come. Join us for a journey through the dynamic real estate landscape that delves deeper into asset classes and the nitty-gritty of the industry.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome back to the podcast, guys.
It's Aston Incorporated.
I'm your host, wayne Aston.
This is my co-host, dallinAston.
Hey, everyone, thus AstonIncorporated.
I think I've said that before.
We got pretty passionate, guys,with the last episode, real
Estate 101.
That was planned for just asingle episode.
There's just so much to it.
We really could make a hundredepisodes out of just talking
(00:24):
about real estate, because welove real estate, we're
passionate about it.
I think today's goal, though,is to make part two of our Real
Estate 101 episode just kind ofcontinuing through.
We started to talk aboutprogramming.
Yeah, yeah, I want to focus onsome programming without giving
all the trade secrets away,because we do have some special
(00:47):
sauce, but I think there's alsogoing to be some value, because
we didn't get very deep into theasset classes.
Like there's still lots of othercommercial stuff so we could
touch on.
So do you think we ought topick up right where we were with
programming on this multifamilystuff, because I think our
listeners were like vibing onthis nightly rental thing or
(01:11):
something.
Speaker 2 (01:12):
Yeah, we can go back into that.
Okay, so let's recap, man.
Speaker 1 (01:16):
So in a nightly rental property with a hundred
units versus a multifamilyapartment complex with the same
hundred units, we're going tospend a little more.
In that nightly rental propertyit's going to be resort grade
amenities and finishes, right,it might cost 20, 25 percent
(01:39):
more.
Moab is unique and all of themarkets that we exist in,
including Lake Habasus City,arizona, lewiston, idaho, moab,
utah and some others comingonline soon there are some
anomalies in the market.
Right, get into those anomaliesas we talk about programming.
But for all intents andpurposes, we're comparing a
(02:04):
hundred units to a hundred units, right, and I think we
illustrated in that last episodethat the traditional landlord
model produces that average offive to seven hundred per month
per unit, which ended up being,right, around a million a year
gross for a hundred units.
(02:26):
Was that about, right?
If you do that, matt, I don'tmean We'll let him calculate
that for the refresher, but onthe nightly rental side, same
hundred, that's 600 grand, oh600.
Speaker 2 (02:36):
So not even a million .
So $600,000.
That's where we landed, wasabout 600K.
Speaker 1 (02:41):
Gross, not including management fees and expenses.
Yeah, this is after mortgage,some of the multifamily guys
will be chiming in telling mewhere we're wrong.
We've miscalculated.
That's okay, we're beingconservative.
I'm sure there's multifamilyspecialists that have bought
class C and B.
(03:02):
So in the multifamily spacethere's three classes of
apartments C, b and A.
Class A is the nicest, that'slike a fourth west.
Well, fourth west is even likeclass A for diamonds, it's like
a luxury class A.
But a class A apartmentbuilding is the nicest typically
.
And class C is your section A,like government subsidized
(03:26):
affordable housing, all right,yeah.
And so the finished quality ineach of those classes is
different, and I'm sure there'smultifamily guys that really are
so good at buying a good dealtheir margins are better than
what I'm saying.
Speaker 2 (03:40):
Oh, 100%.
So again, there's not just oneway to do things, and I think
it's important to also recognizethat this is very like hey,
we're taking.
This is just super simple.
Speaker 1 (03:51):
Yeah.
Speaker 2 (03:51):
We're not getting the weeds here.
If you wanted to get the weeds,it's a different story.
But I mean, this is just hey.
At first glance this is realestate one-on-one.
Yeah, this is one-on-one, thisis one-on-one First episode,
part one, part two so this isone-on-one, simple.
Speaker 1 (04:05):
That's right, that's right.
Speaker 2 (04:06):
From afar.
Speaker 1 (04:08):
So other reasons why do I like a nightly rental
programming so much?
Well, I never have to evictanyone, so blame it on my big
heart.
And having been evicted from aproperty, having gone through a
foreclosure, it's gut-wrenchingto have all of your shit packed
(04:32):
up by constables in plastic bagsand thrown on the street and
you own it one minute and thenext you're done.
You're here, you're out, you'relike getting a bus and find
some other place to live.
That's the reality in some ofthe worst circumstances I've
experienced myself and friendsIn 2008,.
Many friends I was therewatching them be evicted friends
(04:55):
of mine and having gone throughit, well, I just don't have the
heart to do the landlord thingand deal with evictions.
I don't even.
It's just yucky man, it's likeit's PTSD for me.
Nightly rentals it's exciting,everyone's paying top dollar to
be there, they're having fun,we're geared to experience
economy and I don't seem to havea problem with the occupancy,
(05:18):
like I.
Just I provide enough value onthe programming and everything
about it that I'm full.
I'm full most of the time.
Speaker 2 (05:25):
When you get good reviews, people leaving reviews
saying this place is awesome andit feels good.
Speaker 1 (05:31):
I like talking to guests.
I love it.
Speaker 2 (05:34):
I'll have guests reach out and say thanks so much
for being so wonderful and whata cool feeling.
Speaker 1 (05:39):
That's a rewarding that's a very satisfying thing
to get the instant gratificationof your patrons who love the
property.
Speaker 2 (05:48):
We can't wait to come back next year and many say
that you start getting somebrand loyalty because it's
programmed right.
Speaker 1 (05:58):
So what have you experienced?
Let's talk about Moab.
We can beat up on Moab.
We don't know anything to Moab,but Moab's an amazing place.
You've got some amazingnational parks.
Why Moab?
You've got Arches National Park.
You've got Canyonlands NationalPark nearby, you've got Dead
Horse Point State Park.
(06:19):
So you've got all these naturalamenities, these attractions
and people visiting from allover the world.
Historically, I mean, you know,utah sees over 4 million unique
tourists a year.
Zion's National Park isprobably the number one
producing park in Utah.
Speaker 2 (06:37):
Is it over Utah or is it just?
Moab sees 4 million.
Speaker 1 (06:41):
Well, it's just, moab itself will see 4 million Okay.
Zion's alone will see more than4 million.
Speaker 2 (06:47):
Yeah, I think there are about 5 million.
Yeah, that's right, and so youtake that in perspective.
It's not just the state that's4 million, it's those places
that are 4 million or 5 millionor whatever.
Speaker 1 (06:58):
So I want to get into the weeds with you, Dallin,
because I think you probably got, and I have a funny story, now
that I'm thinking about it, ofanother friend investor
contemplating getting into Moab.
So you take all these commondenominators awesome attractions
, world-class location okay,Every property in that county
(07:23):
shares those same commondenominators yeah, absolutely.
And so you got to get deeperinto the programming of what
sets the boys apart from the men.
Speaker 2 (07:31):
Okay.
Speaker 1 (07:32):
What is a top performing asset doing
differently than the averageperformers?
Right, okay, do you want tospeak to what you experienced
when you were trying to do somedue diligence on what to buy in
Moab, like?
Was there anything that sticksout in your mind?
Speaker 2 (07:50):
Yeah, and again, I'm not going to point anyone out
specifically or name anything,but I'd go down there and it was
funny.
Because let me take a quickback.
You look on Airbnb first andforemost, and I could pull this
up now and show you, but for thepodcast's sake I'll just
explain it.
We're sitting here and you lookat Airbnb and you look at the
(08:12):
average listing the averageplace to stay, for lack of a
better term.
It's pretty.
I don't know what's the rightterm.
Speaker 1 (08:23):
What are I looking for?
Speaker 2 (08:26):
It's like very Santa Fe it's.
They're all the same in thesense that they're very.
Oh, I'm going to grandma'shouse, yeah, and again, I'm not
trying to be cruel or judgmentalat all, I'm just saying this is
kind of my, this was myexperience and I thought
Airbnbers pay close attention.
Speaker 1 (08:43):
Yeah, this is programming gold.
Yeah, if you plan to go make aninvestment and put it on Airbnb
, this is gold for you, thisprogramming.
Speaker 2 (08:51):
Absolutely.
It's, if not the most importantthing is up there among some
very important things.
But I'd see these people and Iknow some other owners of units
down there.
I've gotten connected with afew others and I'd be talking to
them.
They're like man.
Yeah, we found on KSL a coupleof.
(09:12):
We found our fridge for $200 onKSL.
It's got denset and I'm like, oh, gee.
And they're like it was such asteal.
And I'm sitting here.
Now you have two schools ofthought right this one side,
where it's like, oh, we can'tfail because it's Moab and we're
just going to throw it up there.
It's going to work.
We're just going to save asmuch money because it's going to
(09:34):
work on the furniture.
We're just, we're not going tospend as much time or money on
the programming because it'sjust going to perform.
And then you have other guysand I'm sitting here.
I'm sitting here looking atthis and I'm saying you know
what?
I'm going to make this anexperience.
I'm not.
I'm going to spend 25 grand oneach unit to make these so
(09:58):
amazing that when you look at apicture, you're going to go whoa
.
When you walk in the unit,you're going to go oh, this is
amazing, Nicer than my house.
I don't want to live here dude,and I have people telling me,
man, you have such a beautiful,they'll walk in like, oh my gosh
, I'm so glad that we stayed atyour place, we'll be coming here
again Then.
You know, I've got some otherthings that make it unique and
(10:20):
we can talk about that.
But I mean, you take a look atthe stark contrast.
And it's so funny to me becauseyou can go on Airbnb and look
at the map in Moab and you cansee price discrepancies.
And I remember one time I waswith my buddy and he was like,
dude, I'm really interested tojust do you have like a case
study of how yours are doing?
I was like, well, I mean, go onAirbnb.
(10:41):
So he pulls it up on hiscomputer and this is how I want
everyone to really listen tothis, because he pulls it up on
his computer and he's likelooking, and he's like, oh,
they're, they're all around 200,but what's this $400 one?
And he clicks on it and it'smine.
And he's like, oh, what?
And I was like, oh, that's fine, and I didn't plan that, I just
told him to just go and look,you know, and he goes okay, well
(11:01):
, here's another 400.
It was like 405.
And he's like who's this one?
It was my other one, can younot?
It was my other one andeverything was the same project.
Yeah Well, and so what's thesame development project.
Speaker 1 (11:13):
Yeah, oh my gosh.
So what's?
Speaker 2 (11:15):
funny is Airbnb.
It won't pinpoint like it'llhave the prices, but it won't
pinpoint on the exact locationbecause it doesn't give that
away until you book.
Yeah, you'll take the exactaddress.
So you have them kind ofscattered out in the general
location.
So I had a 400, my $400 one washere and then just a little bit
down on the map was the other400, even though they're right
next to each other.
The same development.
Yeah, they're a little off inthe map and he's like I'm
(11:36):
curious, it's the, it's mine,yeah, and and, and you know, the
pictures show it.
Now, people do better at thisthan others.
But what I'm trying to get athere is if you are in any, you
know, it doesn't matter whatmarket you're in.
If you're going to be competingwith others in the area, you
know, the only reason someone'sgoing to choose you and not only
choose you but pay more is ifthe experience, the perceived
(12:00):
value and the experience isthere, yeah, right, and having,
you know, putting the extradollar going to the through the
ex, going through the extra mileto make it as amazing, as
unique and as personable aspossible, I think is very
powerful when you have consumerslooking at places where they're
going to say yeah, yeah, Iagree.
Speaker 1 (12:20):
So you know, people define programming many ways,
many ways, and it's myexperience that big franchise
hotel operations have a certainfranchise programming.
It works for them globally.
Part of the programming is alittle archaic.
It's like we want you to feeljust the same comfort level in
(12:43):
China as you do in the US, andso you go stay at a higher place
over here.
It's the same as a higher placeover there, for sure.
So the sameness is what a lotof franchises lean into.
Speaker 2 (12:55):
Yeah.
Speaker 1 (12:55):
So you have what they call a PIP standard in a hotel.
It's the improvement standardof a hotel.
It's the finishes and it's thecolors and it's the beds and the
quality of this and that, andfranchises are committed to
having it be the same.
And what I'm saying to yourpoint is that today's XYZ
(13:23):
generations are way moreinterested in unique experiences
.
They wanna go to the one place.
There's only one of them in theworld, and it just happens to
be that your place is in Moab.
One of my places in Moab it'snot Moab, it's the fact that
that's the only place like it inthat region.
(13:43):
Yeah, yeah.
And so you know I'm reallyexcited and hyper-focused about
what I call regional luxuryresort destinations, and I'm
really excited about regionalluxury resort destinations
because of this fact.
There's an opportunity tocreate something unique, one of
(14:03):
a kind.
I'm not interested induplicating it anywhere else.
It's gotta be drivable.
So what I'm getting into now isthe recession, resistant
hospitality investment Okay, allof our franchise properties
nationwide, the bigger, the MSA.
If you're in Orlando duringCOVID, you got crushed.
If you had debt on that hotelduring COVID, you're out of
(14:27):
business.
Now there are big hotel chainswho were able to wade through
the slug, the swamp of thepandemic, barely.
But if you were on Las Vegas,you got crushed.
You know, to go in Las Vegasand see the Aria booking out at
$49 a night, that's not a profit.
(14:47):
There's no profit, that's alosing.
That's a hotel losing money.
So you know the message here ishospitality and hotels and
condos and Airbnb's aren't bydefault profitable.
There's a lot of moving partsthat go into what makes it
profitable.
I prefer being in a recession,resistant investment.
I'd like to know andstrategically consciously plan
(15:11):
my investment strategies and myinvestment let's call it a
thesis around what happens whena pandemic comes.
What happens when a 2008apocalypse comes?
You have a way.
Before closures, People stopflying to Hawaii and Asia and
Europe and paying for expensivevacations in a recession, right,
(15:33):
okay.
And if I'm the guy who has aluxury that's nice enough
amenities and nice enoughfinishes, that's also in a
drivable destination, it becomesa safety.
Then look, everyone's pent upin the recession, man, they
still want to get out.
They're families and wives andthey want to pack the dog in the
car and they want to get out ofthe house.
(15:54):
They still are human and theystill want to be on vacation.
So if I'm only a hundredhundred and fifty miles away and
it's luxury, guess what I'mpicking all that business up
when the big hotels in Orlandoand Las Vegas are getting
nothing Right.
Okay, so that's another reasonwhy I like specifically the type
of asset class that I prefer tobe in, which is this regional
(16:16):
luxury resort.
You know there's other.
I've done self-storage.
Self-storage is an awesomeasset class for investors.
That's a very low cost toconstruct, low barrier to entry.
It's not single family, so youdon't get a mortgage.
It's specialized financing,it's true, or two development,
(16:41):
because you need like three tofive in case of you know one
project I did eight acres, soyou need more acreage and you're
talking hundreds of units, soyou need a third party manager.
But the cost to profit ratio ishigh, right, so you know.
Anyone thinking about what typeof real estate do I get into?
(17:03):
Self-storage is a great one toget into.
It's easy to syndicate.
There's plenty of high networth guys out there that have a
few million bucks that wouldlike to be in self-storage
because it's safe.
You know, I'm personally notfocused in self-storage anymore
because I've been there.
I've done that.
It's a little boring for me.
I didn't get the satisfactionof the experience, economy and
(17:26):
the programming for my patrons.
Like you know what I'm reallypassionate about.
I just it didn't light me up.
Speaker 2 (17:32):
Well, it goes back to why, right?
So some people have differentwhy's?
Yeah, and again, it's not amatter of better or worse, it's
a matter of different.
True, you know?
And so, yeah, it's important toconsider a thing as well.
Speaker 1 (17:44):
Yeah, yeah, absolutely so you know.
Then you've got office space.
You've got all types of assetclasses in commercial yeah.
So for the newbies, you knowthere's residential real estate
and there's commercial realestate.
Residential means you can livein it.
Commercial means you can't livein it, typically.
So commercial real estate is ahuge subject, man.
(18:08):
It's hotels, it's resorts, it'soffice, it's industrial, it's
manufacturing, it's allself-storage, it's all of those
things.
I just grab a take to hotelsand hospitality because it's
satisfying for me when we talkmore about let's go back to this
(18:30):
programming.
We were talking about thesecommon denominators.
You've got this world-classlocation, world-class amenities.
You have all these differentproperties that share all.
They share the same traffic.
So it's the same customer, allthe same people coming to Moab
could choose from this hotel,that hotel, your property, my
property.
So what sets us apart?
Speaker 2 (18:52):
Okay.
Speaker 1 (18:53):
You've touched on what I call pricing discipline.
The psychology of pricingdiscipline in my experience is
one of the most powerful factorsof success that separates the
men from the boys.
If you naturally operate on aGroupon mentality, no disrespect
(19:17):
to Groupon.
But if you want the discount,if you want to be there for the
fall discount or the holidaydiscount, you're running a
special for Valentine's Day.
That's not the space that I'min.
To me, that shows a lack ofprice discipline.
To me, those discount andpricing schemes reflect weakness
(19:41):
in your plan.
You've got to rely on hedgingyour pricing lower to get the
occupancy there.
I prefer to provide more valueand demand the top of the market
price.
I never provide a discount.
Now people are sitting home onthe couch in the audience today
(20:02):
or in their car and they'resaying oh that's harsh, man.
I mean, if you're neverproviding a discount.
No, it's not that I'm doing youa favor, because when you pay
full price you're willing to goget this experience.
That's well worth the price.
That's the thing that I'mtrying to get across is, my
patrons will come and they'llpay $8.50 a night and they will
(20:27):
leave so happy, so glad.
I can't even tell you how manycustomers have texted me or left
a Google review saying we areso glad we stayed with you
instead of this other.
We were thinking about thishotel over here, but you were
almost double.
But oh my gosh, that pool andthe experiences and stuff we did
(20:49):
, the rock climbing and everyone, just no one regrets paying
good money for an experiencethat's up to the occasion.
Speaker 2 (21:00):
So that's a lesson.
Speaker 1 (21:01):
Price discipline is critical In order for you to
survive the Google reviews and atrue stewardship, fiduciary
responsibility to your patrons.
You have to provide value.
Furnishing is one major way todo it.
We go deeper than that.
(21:22):
We go into the lighting.
Our housekeepers are more likestaging specialists In fact
that's their title and they knowthat they don't just have to
clean the unit, but they need tostage the unit for the next
guest.
So there's certain lamps thatget turned on.
(21:43):
The thermostat has to be theperfect temperature.
So the lighting, thetemperature, the smell In
hospitality you get folks thatwill come in and cook that Asian
barbecue and the whole unitsmells like pork, pork, whatever
, and it's very hard to get thatsmell out.
So the staging specialist hasgot an extra heavy job to get
(22:07):
the smell out, use the fans andthen make it smell right for the
next guest.
But all of this plays into it.
Smell is a critical thing.
People remember If you walkinto a unit that's a bad smell.
Speaker 2 (22:22):
You just got a bad review and they will not bring
it down, they will not come backjust for smell.
Speaker 1 (22:28):
It's a big deal If the smell is amazing you're
halfway there and they're likelyto come back if you get a great
smelling unit.
So programming now programminggoes deeper than that.
Even you know, at Sage Creekthere's the resort itself,
there's the pool complex and theamenities.
There's things that I designedin that pool complex, like a
(22:51):
movie side or, excuse me, poolside movie theater, High
definition audio throughout thelandscape.
So when you're sitting aroundpool side we've got ambient
music playing.
Speaker 2 (23:04):
It's like a resort, because it is a resort.
Speaker 1 (23:06):
It's very relaxing.
The lighting is critical.
Down in Grand County they'revery particular about the Dark
Sky Initiative and I love totake credit for being able to
co-author the 2019 Dark SkiesInitiative.
Similar to this, moab in GrandCounty had this archaic.
(23:28):
It was like a two-pager.
We know that we value Dark Sky,but none of the hotels comply.
And you drive down Main StreetMoab all these hotels have
bright lights.
They're trying to do the LasVegas thing.
Speaker 2 (23:41):
And it's just noise.
Speaker 1 (23:42):
It's light pollution to where you can't see stars.
And so we brought in aspecialized lighting engineer
and we said look, we're veryfocused on the experience,
economy and the programming, sotherefore the lighting has to be
exact in this pool complex.
What does that mean?
Well, we provided science tothe county Specific lighting
(24:05):
reports when they came out withmeasuring tools at night.
And what we found was that theold code before we built Sage
Creek was code required 50-footcandles of light per foot.
And to equate that for ourlisteners, that's like daylight,
that's like standing at noon,high noon, on the pool deck.
(24:27):
They're saying, for safetyreasons, you have to light it up
to that level at night.
And we were able to showscience that says look, the body
doesn't produce melatonin tostart to relax until we get
under 2,700 Kelvin rating.
And that's the warmth and heatof the light.
And as we showed it to them, wesaid look, what's your code?
(24:48):
This 50-year-old's old says iswe can never relax at the pool,
but it's a resort, we'resupposed to relax and it's so
bright I can't even see thestars.
So this goes against yourcurrent code, goes against your
dark skies initiative.
Isn't there a compromise?
Interesting?
And they thought about this andthey looked at all this science
and we were able to helppersuade them to let us author
(25:11):
an 18-page dark skies initiativethat has teeth in it, that all
of the hoteliers in Moab andGrand County are going to be
made to conform to by, I think,2023, to really support a dark
skies initiative.
But what we did is we were ableto persuade the county to
actually give a lightingvariance to where we produce
(25:33):
about 18% of what code requiresat night and that hits that
2,700 Kelvin rating.
But we've got safety switches.
So if we have a casualty in thepool, we need to have emergency
responders.
We flip on the emergencylighting and it's like daylight.
That's a great compromise, butwe were also able to get the
(25:54):
first pool in Grand Countythat's got multicolored lighting
in it, which you've been thereand it's magical.
That's part of the detailsmatter, programming.
It's one thing to swim in anice pool with the bright white
lights in it.
It's a whole other thing toswim in a really great pool with
waterfalls, fire features andcolored lighting.
(26:16):
That's changing.
It's like a living thing, verycool.
So it's a major draw.
It's the experience.
It's the experience, absolutely.
So, for all of theseprogramming reasons, you get a
natural polarization of topperformers, cool shit, and
(26:37):
average performers.
But it takes money and energyand actually love.
Yeah, okay, it actuallyrequires an operator to put love
in the equation.
Yeah, people are like sittinghome, like what.
Like, what are we talking about?
Speaker 2 (26:55):
Well, I think this is part of what makes, I think,
this show so unique.
Right, and I think you know yougo back and listen to previous
episodes, but everything thatwe're talking about here stems
from this place of love, service, value.
Yeah, and I think you know Ipersonally and I don't want to
speak for you as well, but Idon't want to just sit here and
(27:16):
talk to everyone and make a showthat is just repeat of what
everyone else is saying.
Yeah, you know, I want this tobe different and valuable and
unique, because and it's goingto be a little bit different
when you hear this, you're likewhat?
Yeah, but at the end of the day, this is, yeah, this is what
has worked and what continues towork and serves us very well.
Speaker 1 (27:37):
Yeah, you know, what's interesting and
liberating about this is Iteased at the beginning of the
episode about sharing tradesecrets Very scarcity minded
statement.
I was just.
I was teasing.
I'm a very abundant thinker andanyone who's worried about
their trade secrets is maybeleaning on that scarcity side,
(27:59):
like someone might steal it.
But when I explain to you andthe audience that love is the
primary driving force to whatwe're doing, and then you go
back a few episodes and youthink of the why and this plan
and this calling that God hasgiven us okay, so being clear
(28:23):
about why, being clear about whowe serve, being really focused
with letting love be a drivingenergy on what we're doing love
to our patrons, love for ourinvestors it changes the whole
dynamic.
I can give you all the secrets.
Yeah, and if you're not aloving person, if you can't
(28:48):
operate with love and be genuine, you can't even compete with me
.
Yeah, it's a naturaldifferentiator.
Not everyone's gonna be able todo that.
I'm confident telling tradesecrets because you can't
duplicate that if you try,because there's this
authenticity.
Yeah.
Speaker 2 (29:09):
That's unique.
That is unique, unrepeatablewhat's the right word?
It's unrepeatable, it's notduplicate.
Speaker 1 (29:15):
Yeah, it's non-replicatable, it's a.
There's only one person thatcan do this.
Now you have your own uniqueway of showing love and you do a
great job, because I've seenyour reviews.
Your Google reviews are fireLike it's all five star reviews
Raving about how they love it,Because they feel how much you
(29:36):
care about them Like they knowit's not about the money and you
charge them twice as much asthe folks in the one next door.
Speaker 2 (29:44):
That's what's crazy, right, because and you know to
your point, probably themajority of the reviews actually
go back down to.
They're like down, you are soamazing and we have such a great
time at your stay, so theybring up two points.
Or, at your place, they bringup two points.
They bring up first of all,they love the property.
Almost every review, I think,has something to do with how
(30:07):
amazing the property itself is.
But, a majority of them alsoinclude thank you for caring,
and they say those wordsspecifically.
Right, and I think that'simportant because you talk about
whatever asset class in realestate, you know your single
family.
You know I'd love to get yourthoughts here, but single family
(30:28):
is, you know, night rentals,it's storage, anything.
If you have this mindset of weare creating this value for who
we're serving, each of thoseclasses is serving someone, yeah
, so take it from thatperspective and say, hey, we're
focused.
Whatever we're doing, we'refocused on this individual and
yours will perform betterbecause you're focused on the
(30:49):
individual instead of the cashor the actual materials or
whatever.
Speaker 1 (30:55):
Yeah.
Speaker 2 (30:55):
Right yeah.
Speaker 1 (30:56):
Absolutely, absolutely.
It applies to all the assetclasses.
You know, if you're doingoffice space and you've got
tenants doing TIs and their ownbusinesses, you know similar
there's ways.
There's ways for you to showthat you genuinely care with
amenities, with finishes, withprogramming, with your
(31:16):
interactions, with the wholething, the whole experience.
Right yeah, hotels is just oneof the easiest ones because
there's so many ways you aredirectly doing this.
Speaker 2 (31:30):
There's so many guests on a very personal level,
very personal level.
Speaker 1 (31:34):
Oh, yeah, yeah, yeah for sure.
So that's, I suppose, why Igravitate to it.
So I love that it's recessionresistant, I love that it makes
more money than the other assetclasses when you do it correctly
, because I naturally like to bea service, for sure it's like
again.
So you know, do what you'repassionate about.
I mean, that's cliche andeveryone talks about it, but
(31:55):
that really that hits.
Speaker 2 (31:57):
I mean, leading with love is also kind of cliche.
Yeah, do you think you've gotit?
Yeah, but it doesn't change thefact that principles that work
are principles that work, youknow, diverging off of kind of
the real estate specific focus.
Speaker 1 (32:11):
If we're just talking about this lead with love
philosophy, we would go back tothe veterans.
We go back to the foundation,go back to the rising tide
foundation with that wementioned in past episodes, you
know, and speaking fromexperience.
Look, training for combat lovesnot part of that equation.
The more, the more predominantthought is stifle your emotions.
(32:33):
Thanks, jaco.
What are my favorite?
Yeah, stifle your emotions, andit's true.
Like you, you know you'retrained in the Marine Corps and
every branch to stifle youremotions.
Hold it in, don't be emotional.
Be logical, because in combatand chaos, you can't, you can't.
That shows up as weakness andfear.
(32:54):
Right, and so it's a kind of ashocker when we're dealing with
workforce, and this applies tothe staging specialists, it
applies to groundsmen, itapplies to veterans working in
the factories and working as ourfleet drivers and all of these
jobs and how the culture thatwe're providing and cultivating
(33:21):
is leading with love.
We're going to be coming backto culture many times over the
the long time.
It's an ongoing conversation,but, but culture with our
staffing is a great way for usto extend love to our staff,
through our staff, to reach ourcustomers.
(33:41):
Yeah, when our, when our stafffeel love and cared for and
honored and respected andthey're happy and we're the
obvious employer that they wantto work for.
Right, money's not, I mean,they get paid well, but that's
not why they're there.
Yeah, right, and thattranslates over to.
Speaker 2 (34:02):
So good luck trying to replicate that If you're not
like loving your staff like yeah, you know high turn over rate
and you know all these otherproblems.
Speaker 1 (34:10):
Yeah, yeah.
Speaker 2 (34:11):
I also think there is an important balance.
You know there is a line.
Like you know, leaving lovedoes not, you know, it does not
give you the right to becomplacent or allow complacency.
No, not at all, not at all.
In fact, it's the opposite,it's a higher standard.
Speaker 1 (34:26):
It's the opposite, right, yeah, yeah, you know
you're going to have employees.
Speaker 2 (34:32):
You're going to have, you know, teens and you're
going to be because it's.
This is kind of a silly analogy, but if you have something
stuck in your teeth and someonedoesn't tell you, I'm like dude.
Speaker 1 (34:43):
Yeah, like.
Or toilet paper hanging out theback of your patch.
You're like if you love me,you'll tell me about it.
Speaker 2 (34:49):
It's the same principle.
Speaker 1 (34:51):
You'll love me enough to tell me the truth.
Speaker 2 (34:53):
Tell me, there's something in my teeth.
Speaker 1 (34:55):
Don't protect me from the uncomfortable.
Speaker 2 (34:57):
Yeah.
Speaker 1 (34:57):
Don't lie to me and tell me what you think you want
me to hear yeah, yeah, becausethat doesn't serve it.
Speaker 2 (35:03):
That's a disservice.
Speaker 1 (35:04):
That's a disservice as an employer to employee or
employee to employee.
So part of love is integrity,yep, and commanding excellence
and courage, and demandingexcellence and being an example
of all of that Right.
Speaker 2 (35:23):
There's a lot to that .
I also think there's also anavenue of welcoming.
You know, this is going to bekind of a unique approach, but I
personally think this is veryimportant Accepting mistakes
right, Like you make it.
It is human, Everyone is goingto make a mistake.
Yeah, the worst possiblescenarios.
(35:44):
You have employees or teamsmaking mistakes and hiding them,
Like I have a fear forpunishment.
Exactly, exactly.
Future for response yeah, and soagain no matter what asset
class you're in, no matter whatteams you're involved with, no
matter what.
I think this culture of lovealso elicits this sense of hey,
you know what Mistakes are?
(36:04):
Okay, let's do everything wecan to avoid them.
Yeah, but they're going tohappen, yeah.
Don't like.
Let's make sure they're known,because I think, mistakes being
hidden, the recipe.
I mean you look at RussellBrunson yeah, for just a little
example.
You know he tells the story ofone of his first companies,
where one of his employees madea mistake on payroll taxes and
(36:25):
he found this out.
Or his father calls him up andhe's like hey, you know, we owe
X amount.
You're going to go to jail in amonth if you don't pay this.
And Russell tells the story.
He's like it was the mostsickening day of my life, but
because this employee feltembarrassed or whatever the
reason that they made thismistake.
But then it ended up being wayworse than it should have been.
Speaker 1 (36:45):
Yeah, you know, and so anyway, I think that also
ties into this.
Speaker 2 (36:48):
It's commanding that excellence but at the same time
you know it's the food and thetea thing.
Speaker 1 (36:52):
Yeah, yeah.
So yeah it's.
How can I incentivize andalmost reward you for your
courage and integrity andwillingness to come forward and
be honest so that we can use itas a case study for everyone
else and it can be an abductivetool?
Speaker 2 (37:10):
Okay.
Speaker 1 (37:11):
You broke this.
Yeah, this mistake happened.
Yeah, let's have that be anopportunity for everyone to see
it.
Yeah, and let's honor you forcoming forward and then now
everyone's going to rememberthat Not gonna happen.
Speaker 2 (37:26):
They're not gonna remember the mistake.
Speaker 1 (37:27):
It won't happen again , likely, but that's because
everyone's gonna remember thatit was a big deal and it was a
lesson and it was a good thing,a positive thing.
They'll remember the positiveside of that.
Speaker 2 (37:37):
So yeah, and again this, this will set you apart.
Speaker 1 (37:42):
Yeah.
Speaker 2 (37:43):
We're talking about stuff that is so.
I mean, it's not.
We're not reinventing the wheel.
Real estate has been around forso long.
Absolutely yeah, we're notreinventing the wheel here.
This is you know, this has beendone before modeling what works
.
But then how do you?
Okay, now it's time to standout.
My cleaner, for example, textedme the other day and was like
you know, I've never had a bossthat cares as much as you do.
(38:05):
She said that.
She texted me, said that, yeah,and that's well, guess what
that's gonna do?
She's now gonna make the uniteven better.
Yeah, now, if the guest isgonna have a problem, she's
gonna go.
Can I actually go help themright now?
Yeah, and she's done it.
Yeah, you know, and that's whatmakes a truly distinct, unique,
like a value proposition.
(38:26):
That is what makes, that's whatdifferentiates us, and it all
stems from that.
Oh my gosh, you're the bestemployer.
I'm gonna make sure that Iperform.
Speaker 1 (38:35):
Yeah, you get an extra measure out of a devoted
employee.
Yes, I had a similar thing withan employee on the Moab Resort
where some guests didn'tdisclose the number of people in
their party.
I'm expecting seven people.
They show up with 14 people andthe unit wasn't equipped for 14
(38:56):
people.
But what did we do?
I call up my one guy who livesnearby and said hey, we need to
move a couch.
It was 1230 at night.
They were checking in aftermidnight.
He gets out his bed, he comesover and he and I move a couch
into this unit, so they have aqueen sleeper and they have two
extra twin mattresses and wejust we just rolled with it.
But you do not get that levelof committed devotion out of
(39:21):
staff.
If you're not showing upleading with love, if they don't
know that you absolutely lovethem as family, you're never
going to get that.
Speaker 2 (39:31):
So that's an exciting thing.
Speaker 1 (39:32):
It's something that feels really good.
You know when you're, whenyou're getting that type of
response.
Yeah, I think, I think we've.
I mean we.
There's a hundred more thingswe could talk about real estate,
but I feel like we're.
Speaker 2 (39:48):
Is there something else you wanted to?
Speaker 1 (39:49):
hit here in real estate part two.
Speaker 2 (39:50):
Yeah, my thought is hey look, this is real estate
one on one.
Here's kind of the brief.
This is you know, and we couldgo for hours and talk and I
think you know, and you couldabsolutely and I could just pick
your brain, you know and youknow.
But but I think we're going todive into a lot of more, even
more granular specifics of eachasset class and, and even more
(40:13):
so, with other different avenuesthat are that are, you know, in
the process of what it takes.
So I think we probably call ithere and continue into you know,
diving a little bit deeperthroughout next few episodes and
onward.
That sounds good.
Speaker 1 (40:27):
Thank you, guys for tuning in Again.
Aston Incorporated.
We appreciate your support.
Have a good night.
We'll catch you on the nextepisode.
Thanks, guys.
Welcome back to the podcast, guys.
It's Aston Incorporated.
I'm your host, wayne Aston.
This is my co-host, dallinAston.
Hey, everyone, thus AstonIncorporated.
I think I've said that before.
We got pretty passionate, guys,with the last episode, real
Estate 101.
That was planned for just asingle episode.
There's just so much to it.
We really could make a hundredepisodes out of just talking
(00:24):
about real estate, because welove real estate, we're
passionate about it.
I think today's goal, though,is to make part two of our Real
Estate 101 episode just kind ofcontinuing through.
We started to talk aboutprogramming.
Yeah, yeah, I want to focus onsome programming without giving
all the trade secrets away,because we do have some special
(00:47):
sauce, but I think there's alsogoing to be some value, because
we didn't get very deep into theasset classes.
Like there's still lots of othercommercial stuff so we could
touch on.
So do you think we ought topick up right where we were with
programming on this multifamilystuff, because I think our
listeners were like vibing onthis nightly rental thing or
(01:11):
something.
Speaker 2 (01:12):
Yeah, we can go back into that.
Okay, so let's recap, man.
Speaker 1 (01:16):
So in a nightly rental property with a hundred
units versus a multifamilyapartment complex with the same
hundred units, we're going tospend a little more.
In that nightly rental propertyit's going to be resort grade
amenities and finishes, right,it might cost 20, 25 percent
(01:39):
more.
Moab is unique and all of themarkets that we exist in,
including Lake Habasus City,arizona, lewiston, idaho, moab,
utah and some others comingonline soon there are some
anomalies in the market.
Right, get into those anomaliesas we talk about programming.
But for all intents andpurposes, we're comparing a
(02:04):
hundred units to a hundred units, right, and I think we
illustrated in that last episodethat the traditional landlord
model produces that average offive to seven hundred per month
per unit, which ended up being,right, around a million a year
gross for a hundred units.
(02:26):
Was that about, right?
If you do that, matt, I don'tmean We'll let him calculate
that for the refresher, but onthe nightly rental side, same
hundred, that's 600 grand, oh600.
Speaker 2 (02:36):
So not even a million .
So $600,000.
That's where we landed, wasabout 600K.
Speaker 1 (02:41):
Gross, not including management fees and expenses.
Yeah, this is after mortgage,some of the multifamily guys
will be chiming in telling mewhere we're wrong.
We've miscalculated.
That's okay, we're beingconservative.
I'm sure there's multifamilyspecialists that have bought
class C and B.
(03:02):
So in the multifamily spacethere's three classes of
apartments C, b and A.
Class A is the nicest, that'slike a fourth west.
Well, fourth west is even likeclass A for diamonds, it's like
a luxury class A.
But a class A apartmentbuilding is the nicest typically
.
And class C is your section A,like government subsidized
(03:26):
affordable housing, all right,yeah.
And so the finished quality ineach of those classes is
different, and I'm sure there'smultifamily guys that really are
so good at buying a good dealtheir margins are better than
what I'm saying.
Speaker 2 (03:40):
Oh, 100%.
So again, there's not just oneway to do things, and I think
it's important to also recognizethat this is very like hey,
we're taking.
This is just super simple.
Speaker 1 (03:51):
Yeah.
Speaker 2 (03:51):
We're not getting the weeds here.
If you wanted to get the weeds,it's a different story.
But I mean, this is just hey.
At first glance this is realestate one-on-one.
Yeah, this is one-on-one, thisis one-on-one First episode,
part one, part two so this isone-on-one, simple.
Speaker 1 (04:05):
That's right, that's right.
Speaker 2 (04:06):
From afar.
Speaker 1 (04:08):
So other reasons why do I like a nightly rental
programming so much?
Well, I never have to evictanyone, so blame it on my big
heart.
And having been evicted from aproperty, having gone through a
foreclosure, it's gut-wrenchingto have all of your shit packed
(04:32):
up by constables in plastic bagsand thrown on the street and
you own it one minute and thenext you're done.
You're here, you're out, you'relike getting a bus and find
some other place to live.
That's the reality in some ofthe worst circumstances I've
experienced myself and friendsIn 2008,.
Many friends I was therewatching them be evicted friends
(04:55):
of mine and having gone throughit, well, I just don't have the
heart to do the landlord thingand deal with evictions.
I don't even.
It's just yucky man, it's likeit's PTSD for me.
Nightly rentals it's exciting,everyone's paying top dollar to
be there, they're having fun,we're geared to experience
economy and I don't seem to havea problem with the occupancy,
(05:18):
like I.
Just I provide enough value onthe programming and everything
about it that I'm full.
I'm full most of the time.
Speaker 2 (05:25):
When you get good reviews, people leaving reviews
saying this place is awesome andit feels good.
Speaker 1 (05:31):
I like talking to guests.
I love it.
Speaker 2 (05:34):
I'll have guests reach out and say thanks so much
for being so wonderful and whata cool feeling.
Speaker 1 (05:39):
That's a rewarding that's a very satisfying thing
to get the instant gratificationof your patrons who love the
property.
Speaker 2 (05:48):
We can't wait to come back next year and many say
that you start getting somebrand loyalty because it's
programmed right.
Speaker 1 (05:58):
So what have you experienced?
Let's talk about Moab.
We can beat up on Moab.
We don't know anything to Moab,but Moab's an amazing place.
You've got some amazingnational parks.
Why Moab?
You've got Arches National Park.
You've got Canyonlands NationalPark nearby, you've got Dead
Horse Point State Park.
(06:19):
So you've got all these naturalamenities, these attractions
and people visiting from allover the world.
Historically, I mean, you know,utah sees over 4 million unique
tourists a year.
Zion's National Park isprobably the number one
producing park in Utah.
Speaker 2 (06:37):
Is it over Utah or is it just?
Moab sees 4 million.
Speaker 1 (06:41):
Well, it's just, moab itself will see 4 million Okay.
Zion's alone will see more than4 million.
Speaker 2 (06:47):
Yeah, I think there are about 5 million.
Yeah, that's right, and so youtake that in perspective.
It's not just the state that's4 million, it's those places
that are 4 million or 5 millionor whatever.
Speaker 1 (06:58):
So I want to get into the weeds with you, Dallin,
because I think you probably got, and I have a funny story, now
that I'm thinking about it, ofanother friend investor
contemplating getting into Moab.
So you take all these commondenominators awesome attractions
, world-class location okay,Every property in that county
(07:23):
shares those same commondenominators yeah, absolutely.
And so you got to get deeperinto the programming of what
sets the boys apart from the men.
Speaker 2 (07:31):
Okay.
Speaker 1 (07:32):
What is a top performing asset doing
differently than the averageperformers?
Right, okay, do you want tospeak to what you experienced
when you were trying to do somedue diligence on what to buy in
Moab, like?
Was there anything that sticksout in your mind?
Speaker 2 (07:50):
Yeah, and again, I'm not going to point anyone out
specifically or name anything,but I'd go down there and it was
funny.
Because let me take a quickback.
You look on Airbnb first andforemost, and I could pull this
up now and show you, but for thepodcast's sake I'll just
explain it.
We're sitting here and you lookat Airbnb and you look at the
(08:12):
average listing the averageplace to stay, for lack of a
better term.
It's pretty.
I don't know what's the rightterm.
Speaker 1 (08:23):
What are I looking for?
Speaker 2 (08:26):
It's like very Santa Fe it's.
They're all the same in thesense that they're very.
Oh, I'm going to grandma'shouse, yeah, and again, I'm not
trying to be cruel or judgmentalat all, I'm just saying this is
kind of my, this was myexperience and I thought
Airbnbers pay close attention.
Speaker 1 (08:43):
Yeah, this is programming gold.
Yeah, if you plan to go make aninvestment and put it on Airbnb
, this is gold for you, thisprogramming.
Speaker 2 (08:51):
Absolutely.
It's, if not the most importantthing is up there among some
very important things.
But I'd see these people and Iknow some other owners of units
down there.
I've gotten connected with afew others and I'd be talking to
them.
They're like man.
Yeah, we found on KSL a coupleof.
(09:12):
We found our fridge for $200 onKSL.
It's got denset and I'm like, oh, gee.
And they're like it was such asteal.
And I'm sitting here.
Now you have two schools ofthought right this one side,
where it's like, oh, we can'tfail because it's Moab and we're
just going to throw it up there.
It's going to work.
We're just going to save asmuch money because it's going to
(09:34):
work on the furniture.
We're just, we're not going tospend as much time or money on
the programming because it'sjust going to perform.
And then you have other guysand I'm sitting here.
I'm sitting here looking atthis and I'm saying you know
what?
I'm going to make this anexperience.
I'm not.
I'm going to spend 25 grand oneach unit to make these so
(09:58):
amazing that when you look at apicture, you're going to go whoa
.
When you walk in the unit,you're going to go oh, this is
amazing, Nicer than my house.
I don't want to live here dude,and I have people telling me,
man, you have such a beautiful,they'll walk in like, oh my gosh
, I'm so glad that we stayed atyour place, we'll be coming here
again Then.
You know, I've got some otherthings that make it unique and
(10:20):
we can talk about that.
But I mean, you take a look atthe stark contrast.
And it's so funny to me becauseyou can go on Airbnb and look
at the map in Moab and you cansee price discrepancies.
And I remember one time I waswith my buddy and he was like,
dude, I'm really interested tojust do you have like a case
study of how yours are doing?
I was like, well, I mean, go onAirbnb.
(10:41):
So he pulls it up on hiscomputer and this is how I want
everyone to really listen tothis, because he pulls it up on
his computer and he's likelooking, and he's like, oh,
they're, they're all around 200,but what's this $400 one?
And he clicks on it and it'smine.
And he's like, oh, what?
And I was like, oh, that's fine, and I didn't plan that, I just
told him to just go and look,you know, and he goes okay, well
(11:01):
, here's another 400.
It was like 405.
And he's like who's this one?
It was my other one, can younot?
It was my other one andeverything was the same project.
Yeah Well, and so what's thesame development project.
Speaker 1 (11:13):
Yeah, oh my gosh.
So what's?
Speaker 2 (11:15):
funny is Airbnb.
It won't pinpoint like it'llhave the prices, but it won't
pinpoint on the exact locationbecause it doesn't give that
away until you book.
Yeah, you'll take the exactaddress.
So you have them kind ofscattered out in the general
location.
So I had a 400, my $400 one washere and then just a little bit
down on the map was the other400, even though they're right
next to each other.
The same development.
Yeah, they're a little off inthe map and he's like I'm
(11:36):
curious, it's the, it's mine,yeah, and and, and you know, the
pictures show it.
Now, people do better at thisthan others.
But what I'm trying to get athere is if you are in any, you
know, it doesn't matter whatmarket you're in.
If you're going to be competingwith others in the area, you
know, the only reason someone'sgoing to choose you and not only
choose you but pay more is ifthe experience, the perceived
(12:00):
value and the experience isthere, yeah, right, and having,
you know, putting the extradollar going to the through the
ex, going through the extra mileto make it as amazing, as
unique and as personable aspossible, I think is very
powerful when you have consumerslooking at places where they're
going to say yeah, yeah, Iagree.
Speaker 1 (12:20):
So you know, people define programming many ways,
many ways, and it's myexperience that big franchise
hotel operations have a certainfranchise programming.
It works for them globally.
Part of the programming is alittle archaic.
It's like we want you to feeljust the same comfort level in
(12:43):
China as you do in the US, andso you go stay at a higher place
over here.
It's the same as a higher placeover there, for sure.
So the sameness is what a lotof franchises lean into.
Speaker 2 (12:55):
Yeah.
Speaker 1 (12:55):
So you have what they call a PIP standard in a hotel.
It's the improvement standardof a hotel.
It's the finishes and it's thecolors and it's the beds and the
quality of this and that, andfranchises are committed to
having it be the same.
And what I'm saying to yourpoint is that today's XYZ
(13:23):
generations are way moreinterested in unique experiences
.
They wanna go to the one place.
There's only one of them in theworld, and it just happens to
be that your place is in Moab.
One of my places in Moab it'snot Moab, it's the fact that
that's the only place like it inthat region.
(13:43):
Yeah, yeah.
And so you know I'm reallyexcited and hyper-focused about
what I call regional luxuryresort destinations, and I'm
really excited about regionalluxury resort destinations
because of this fact.
There's an opportunity tocreate something unique, one of
(14:03):
a kind.
I'm not interested induplicating it anywhere else.
It's gotta be drivable.
So what I'm getting into now isthe recession, resistant
hospitality investment Okay, allof our franchise properties
nationwide, the bigger, the MSA.
If you're in Orlando duringCOVID, you got crushed.
If you had debt on that hotelduring COVID, you're out of
(14:27):
business.
Now there are big hotel chainswho were able to wade through
the slug, the swamp of thepandemic, barely.
But if you were on Las Vegas,you got crushed.
You know, to go in Las Vegasand see the Aria booking out at
$49 a night, that's not a profit.
(14:47):
There's no profit, that's alosing.
That's a hotel losing money.
So you know the message here ishospitality and hotels and
condos and Airbnb's aren't bydefault profitable.
There's a lot of moving partsthat go into what makes it
profitable.
I prefer being in a recession,resistant investment.
I'd like to know andstrategically consciously plan
(15:11):
my investment strategies and myinvestment let's call it a
thesis around what happens whena pandemic comes.
What happens when a 2008apocalypse comes?
You have a way.
Before closures, People stopflying to Hawaii and Asia and
Europe and paying for expensivevacations in a recession, right,
(15:33):
okay.
And if I'm the guy who has aluxury that's nice enough
amenities and nice enoughfinishes, that's also in a
drivable destination, it becomesa safety.
Then look, everyone's pent upin the recession, man, they
still want to get out.
They're families and wives andthey want to pack the dog in the
car and they want to get out ofthe house.
(15:54):
They still are human and theystill want to be on vacation.
So if I'm only a hundredhundred and fifty miles away and
it's luxury, guess what I'mpicking all that business up
when the big hotels in Orlandoand Las Vegas are getting
nothing Right.
Okay, so that's another reasonwhy I like specifically the type
of asset class that I prefer tobe in, which is this regional
(16:16):
luxury resort.
You know there's other.
I've done self-storage.
Self-storage is an awesomeasset class for investors.
That's a very low cost toconstruct, low barrier to entry.
It's not single family, so youdon't get a mortgage.
It's specialized financing,it's true, or two development,
(16:41):
because you need like three tofive in case of you know one
project I did eight acres, soyou need more acreage and you're
talking hundreds of units, soyou need a third party manager.
But the cost to profit ratio ishigh, right, so you know.
Anyone thinking about what typeof real estate do I get into?
(17:03):
Self-storage is a great one toget into.
It's easy to syndicate.
There's plenty of high networth guys out there that have a
few million bucks that wouldlike to be in self-storage
because it's safe.
You know, I'm personally notfocused in self-storage anymore
because I've been there.
I've done that.
It's a little boring for me.
I didn't get the satisfactionof the experience, economy and
(17:26):
the programming for my patrons.
Like you know what I'm reallypassionate about.
I just it didn't light me up.
Speaker 2 (17:32):
Well, it goes back to why, right?
So some people have differentwhy's?
Yeah, and again, it's not amatter of better or worse, it's
a matter of different.
True, you know?
And so, yeah, it's important toconsider a thing as well.
Speaker 1 (17:44):
Yeah, yeah, absolutely so you know.
Then you've got office space.
You've got all types of assetclasses in commercial yeah.
So for the newbies, you knowthere's residential real estate
and there's commercial realestate.
Residential means you can livein it.
Commercial means you can't livein it, typically.
So commercial real estate is ahuge subject, man.
(18:08):
It's hotels, it's resorts, it'soffice, it's industrial, it's
manufacturing, it's allself-storage, it's all of those
things.
I just grab a take to hotelsand hospitality because it's
satisfying for me when we talkmore about let's go back to this
(18:30):
programming.
We were talking about thesecommon denominators.
You've got this world-classlocation, world-class amenities.
You have all these differentproperties that share all.
They share the same traffic.
So it's the same customer, allthe same people coming to Moab
could choose from this hotel,that hotel, your property, my
property.
So what sets us apart?
Speaker 2 (18:52):
Okay.
Speaker 1 (18:53):
You've touched on what I call pricing discipline.
The psychology of pricingdiscipline in my experience is
one of the most powerful factorsof success that separates the
men from the boys.
If you naturally operate on aGroupon mentality, no disrespect
(19:17):
to Groupon.
But if you want the discount,if you want to be there for the
fall discount or the holidaydiscount, you're running a
special for Valentine's Day.
That's not the space that I'min.
To me, that shows a lack ofprice discipline.
To me, those discount andpricing schemes reflect weakness
(19:41):
in your plan.
You've got to rely on hedgingyour pricing lower to get the
occupancy there.
I prefer to provide more valueand demand the top of the market
price.
I never provide a discount.
Now people are sitting home onthe couch in the audience today
(20:02):
or in their car and they'resaying oh that's harsh, man.
I mean, if you're neverproviding a discount.
No, it's not that I'm doing youa favor, because when you pay
full price you're willing to goget this experience.
That's well worth the price.
That's the thing that I'mtrying to get across is, my
patrons will come and they'llpay $8.50 a night and they will
(20:27):
leave so happy, so glad.
I can't even tell you how manycustomers have texted me or left
a Google review saying we areso glad we stayed with you
instead of this other.
We were thinking about thishotel over here, but you were
almost double.
But oh my gosh, that pool andthe experiences and stuff we did
(20:49):
, the rock climbing and everyone, just no one regrets paying
good money for an experiencethat's up to the occasion.
Speaker 2 (21:00):
So that's a lesson.
Speaker 1 (21:01):
Price discipline is critical In order for you to
survive the Google reviews and atrue stewardship, fiduciary
responsibility to your patrons.
You have to provide value.
Furnishing is one major way todo it.
We go deeper than that.
(21:22):
We go into the lighting.
Our housekeepers are more likestaging specialists In fact
that's their title and they knowthat they don't just have to
clean the unit, but they need tostage the unit for the next
guest.
So there's certain lamps thatget turned on.
(21:43):
The thermostat has to be theperfect temperature.
So the lighting, thetemperature, the smell In
hospitality you get folks thatwill come in and cook that Asian
barbecue and the whole unitsmells like pork, pork, whatever
, and it's very hard to get thatsmell out.
So the staging specialist hasgot an extra heavy job to get
(22:07):
the smell out, use the fans andthen make it smell right for the
next guest.
But all of this plays into it.
Smell is a critical thing.
People remember If you walkinto a unit that's a bad smell.
Speaker 2 (22:22):
You just got a bad review and they will not bring
it down, they will not come backjust for smell.
Speaker 1 (22:28):
It's a big deal If the smell is amazing you're
halfway there and they're likelyto come back if you get a great
smelling unit.
So programming now programminggoes deeper than that.
Even you know, at Sage Creekthere's the resort itself,
there's the pool complex and theamenities.
There's things that I designedin that pool complex, like a
(22:51):
movie side or, excuse me, poolside movie theater, High
definition audio throughout thelandscape.
So when you're sitting aroundpool side we've got ambient
music playing.
Speaker 2 (23:04):
It's like a resort, because it is a resort.
Speaker 1 (23:06):
It's very relaxing.
The lighting is critical.
Down in Grand County they'revery particular about the Dark
Sky Initiative and I love totake credit for being able to
co-author the 2019 Dark SkiesInitiative.
Similar to this, moab in GrandCounty had this archaic.
(23:28):
It was like a two-pager.
We know that we value Dark Sky,but none of the hotels comply.
And you drive down Main StreetMoab all these hotels have
bright lights.
They're trying to do the LasVegas thing.
Speaker 2 (23:41):
And it's just noise.
Speaker 1 (23:42):
It's light pollution to where you can't see stars.
And so we brought in aspecialized lighting engineer
and we said look, we're veryfocused on the experience,
economy and the programming, sotherefore the lighting has to be
exact in this pool complex.
What does that mean?
Well, we provided science tothe county Specific lighting
(24:05):
reports when they came out withmeasuring tools at night.
And what we found was that theold code before we built Sage
Creek was code required 50-footcandles of light per foot.
And to equate that for ourlisteners, that's like daylight,
that's like standing at noon,high noon, on the pool deck.
(24:27):
They're saying, for safetyreasons, you have to light it up
to that level at night.
And we were able to showscience that says look, the body
doesn't produce melatonin tostart to relax until we get
under 2,700 Kelvin rating.
And that's the warmth and heatof the light.
And as we showed it to them, wesaid look, what's your code?
(24:48):
This 50-year-old's old says iswe can never relax at the pool,
but it's a resort, we'resupposed to relax and it's so
bright I can't even see thestars.
So this goes against yourcurrent code, goes against your
dark skies initiative.
Isn't there a compromise?
Interesting?
And they thought about this andthey looked at all this science
and we were able to helppersuade them to let us author
(25:11):
an 18-page dark skies initiativethat has teeth in it, that all
of the hoteliers in Moab andGrand County are going to be
made to conform to by, I think,2023, to really support a dark
skies initiative.
But what we did is we were ableto persuade the county to
actually give a lightingvariance to where we produce
(25:33):
about 18% of what code requiresat night and that hits that
2,700 Kelvin rating.
But we've got safety switches.
So if we have a casualty in thepool, we need to have emergency
responders.
We flip on the emergencylighting and it's like daylight.
That's a great compromise, butwe were also able to get the
(25:54):
first pool in Grand Countythat's got multicolored lighting
in it, which you've been thereand it's magical.
That's part of the detailsmatter, programming.
It's one thing to swim in anice pool with the bright white
lights in it.
It's a whole other thing toswim in a really great pool with
waterfalls, fire features andcolored lighting.
(26:16):
That's changing.
It's like a living thing, verycool.
So it's a major draw.
It's the experience.
It's the experience, absolutely.
So, for all of theseprogramming reasons, you get a
natural polarization of topperformers, cool shit, and
(26:37):
average performers.
But it takes money and energyand actually love.
Yeah, okay, it actuallyrequires an operator to put love
in the equation.
Yeah, people are like sittinghome, like what.
Like, what are we talking about?
Speaker 2 (26:55):
Well, I think this is part of what makes, I think,
this show so unique.
Right, and I think you know yougo back and listen to previous
episodes, but everything thatwe're talking about here stems
from this place of love, service, value.
Yeah, and I think you know Ipersonally and I don't want to
speak for you as well, but Idon't want to just sit here and
(27:16):
talk to everyone and make a showthat is just repeat of what
everyone else is saying.
Yeah, you know, I want this tobe different and valuable and
unique, because and it's goingto be a little bit different
when you hear this, you're likewhat?
Yeah, but at the end of the day, this is, yeah, this is what
has worked and what continues towork and serves us very well.
Speaker 1 (27:37):
Yeah, you know, what's interesting and
liberating about this is Iteased at the beginning of the
episode about sharing tradesecrets Very scarcity minded
statement.
I was just.
I was teasing.
I'm a very abundant thinker andanyone who's worried about
their trade secrets is maybeleaning on that scarcity side,
(27:59):
like someone might steal it.
But when I explain to you andthe audience that love is the
primary driving force to whatwe're doing, and then you go
back a few episodes and youthink of the why and this plan
and this calling that God hasgiven us okay, so being clear
(28:23):
about why, being clear about whowe serve, being really focused
with letting love be a drivingenergy on what we're doing love
to our patrons, love for ourinvestors it changes the whole
dynamic.
I can give you all the secrets.
Yeah, and if you're not aloving person, if you can't
(28:48):
operate with love and be genuine, you can't even compete with me
.
Yeah, it's a naturaldifferentiator.
Not everyone's gonna be able todo that.
I'm confident telling tradesecrets because you can't
duplicate that if you try,because there's this
authenticity.
Yeah.
Speaker 2 (29:09):
That's unique.
That is unique, unrepeatablewhat's the right word?
It's unrepeatable, it's notduplicate.
Speaker 1 (29:15):
Yeah, it's non-replicatable, it's a.
There's only one person thatcan do this.
Now you have your own uniqueway of showing love and you do a
great job, because I've seenyour reviews.
Your Google reviews are fireLike it's all five star reviews
Raving about how they love it,Because they feel how much you
(29:36):
care about them Like they knowit's not about the money and you
charge them twice as much asthe folks in the one next door.
Speaker 2 (29:44):
That's what's crazy, right, because and you know to
your point, probably themajority of the reviews actually
go back down to.
They're like down, you are soamazing and we have such a great
time at your stay, so theybring up two points.
Or, at your place, they bringup two points.
They bring up first of all,they love the property.
Almost every review, I think,has something to do with how
(30:07):
amazing the property itself is.
But, a majority of them alsoinclude thank you for caring,
and they say those wordsspecifically.
Right, and I think that'simportant because you talk about
whatever asset class in realestate, you know your single
family.
You know I'd love to get yourthoughts here, but single family
(30:28):
is, you know, night rentals,it's storage, anything.
If you have this mindset of weare creating this value for who
we're serving, each of thoseclasses is serving someone, yeah
, so take it from thatperspective and say, hey, we're
focused.
Whatever we're doing, we'refocused on this individual and
yours will perform betterbecause you're focused on the
(30:49):
individual instead of the cashor the actual materials or
whatever.
Speaker 1 (30:55):
Yeah.
Speaker 2 (30:55):
Right yeah.
Speaker 1 (30:56):
Absolutely, absolutely.
It applies to all the assetclasses.
You know, if you're doingoffice space and you've got
tenants doing TIs and their ownbusinesses, you know similar
there's ways.
There's ways for you to showthat you genuinely care with
amenities, with finishes, withprogramming, with your
(31:16):
interactions, with the wholething, the whole experience.
Right yeah, hotels is just oneof the easiest ones because
there's so many ways you aredirectly doing this.
Speaker 2 (31:30):
There's so many guests on a very personal level,
very personal level.
Speaker 1 (31:34):
Oh, yeah, yeah, yeah for sure.
So that's, I suppose, why Igravitate to it.
So I love that it's recessionresistant, I love that it makes
more money than the other assetclasses when you do it correctly
, because I naturally like to bea service, for sure it's like
again.
So you know, do what you'repassionate about.
I mean, that's cliche andeveryone talks about it, but
(31:55):
that really that hits.
Speaker 2 (31:57):
I mean, leading with love is also kind of cliche.
Yeah, do you think you've gotit?
Yeah, but it doesn't change thefact that principles that work
are principles that work, youknow, diverging off of kind of
the real estate specific focus.
Speaker 1 (32:11):
If we're just talking about this lead with love
philosophy, we would go back tothe veterans.
We go back to the foundation,go back to the rising tide
foundation with that wementioned in past episodes, you
know, and speaking fromexperience.
Look, training for combat lovesnot part of that equation.
The more, the more predominantthought is stifle your emotions.
(32:33):
Thanks, jaco.
What are my favorite?
Yeah, stifle your emotions, andit's true.
Like you, you know you'retrained in the Marine Corps and
every branch to stifle youremotions.
Hold it in, don't be emotional.
Be logical, because in combatand chaos, you can't, you can't.
That shows up as weakness andfear.
(32:54):
Right, and so it's a kind of ashocker when we're dealing with
workforce, and this applies tothe staging specialists, it
applies to groundsmen, itapplies to veterans working in
the factories and working as ourfleet drivers and all of these
jobs and how the culture thatwe're providing and cultivating
(33:21):
is leading with love.
We're going to be coming backto culture many times over the
the long time.
It's an ongoing conversation,but, but culture with our
staffing is a great way for usto extend love to our staff,
through our staff, to reach ourcustomers.
(33:41):
Yeah, when our, when our stafffeel love and cared for and
honored and respected andthey're happy and we're the
obvious employer that they wantto work for.
Right, money's not, I mean,they get paid well, but that's
not why they're there.
Yeah, right, and thattranslates over to.
Speaker 2 (34:02):
So good luck trying to replicate that If you're not
like loving your staff like yeah, you know high turn over rate
and you know all these otherproblems.
Speaker 1 (34:10):
Yeah, yeah.
Speaker 2 (34:11):
I also think there is an important balance.
You know there is a line.
Like you know, leaving lovedoes not, you know, it does not
give you the right to becomplacent or allow complacency.
No, not at all, not at all.
In fact, it's the opposite,it's a higher standard.
Speaker 1 (34:26):
It's the opposite, right, yeah, yeah, you know
you're going to have employees.
Speaker 2 (34:32):
You're going to have, you know, teens and you're
going to be because it's.
This is kind of a silly analogy, but if you have something
stuck in your teeth and someonedoesn't tell you, I'm like dude.
Speaker 1 (34:43):
Yeah, like.
Or toilet paper hanging out theback of your patch.
You're like if you love me,you'll tell me about it.
Speaker 2 (34:49):
It's the same principle.
Speaker 1 (34:51):
You'll love me enough to tell me the truth.
Speaker 2 (34:53):
Tell me, there's something in my teeth.
Speaker 1 (34:55):
Don't protect me from the uncomfortable.
Speaker 2 (34:57):
Yeah.
Speaker 1 (34:57):
Don't lie to me and tell me what you think you want
me to hear yeah, yeah, becausethat doesn't serve it.
Speaker 2 (35:03):
That's a disservice.
Speaker 1 (35:04):
That's a disservice as an employer to employee or
employee to employee.
So part of love is integrity,yep, and commanding excellence
and courage, and demandingexcellence and being an example
of all of that Right.
Speaker 2 (35:23):
There's a lot to that .
I also think there's also anavenue of welcoming.
You know, this is going to bekind of a unique approach, but I
personally think this is veryimportant Accepting mistakes
right, Like you make it.
It is human, Everyone is goingto make a mistake.
Yeah, the worst possiblescenarios.
(35:44):
You have employees or teamsmaking mistakes and hiding them,
Like I have a fear forpunishment.
Exactly, exactly.
Future for response yeah, and soagain no matter what asset
class you're in, no matter whatteams you're involved with, no
matter what.
I think this culture of lovealso elicits this sense of hey,
you know what Mistakes are?
(36:04):
Okay, let's do everything wecan to avoid them.
Yeah, but they're going tohappen, yeah.
Don't like.
Let's make sure they're known,because I think, mistakes being
hidden, the recipe.
I mean you look at RussellBrunson yeah, for just a little
example.
You know he tells the story ofone of his first companies,
where one of his employees madea mistake on payroll taxes and
(36:25):
he found this out.
Or his father calls him up andhe's like hey, you know, we owe
X amount.
You're going to go to jail in amonth if you don't pay this.
And Russell tells the story.
He's like it was the mostsickening day of my life, but
because this employee feltembarrassed or whatever the
reason that they made thismistake.
But then it ended up being wayworse than it should have been.
Speaker 1 (36:45):
Yeah, you know, and so anyway, I think that also
ties into this.
Speaker 2 (36:48):
It's commanding that excellence but at the same time
you know it's the food and thetea thing.
Speaker 1 (36:52):
Yeah, yeah.
So yeah it's.
How can I incentivize andalmost reward you for your
courage and integrity andwillingness to come forward and
be honest so that we can use itas a case study for everyone
else and it can be an abductivetool?
Speaker 2 (37:10):
Okay.
Speaker 1 (37:11):
You broke this.
Yeah, this mistake happened.
Yeah, let's have that be anopportunity for everyone to see
it.
Yeah, and let's honor you forcoming forward and then now
everyone's going to rememberthat Not gonna happen.
Speaker 2 (37:26):
They're not gonna remember the mistake.
Speaker 1 (37:27):
It won't happen again , likely, but that's because
everyone's gonna remember thatit was a big deal and it was a
lesson and it was a good thing,a positive thing.
They'll remember the positiveside of that.
Speaker 2 (37:37):
So yeah, and again this, this will set you apart.
Speaker 1 (37:42):
Yeah.
Speaker 2 (37:43):
We're talking about stuff that is so.
I mean, it's not.
We're not reinventing the wheel.
Real estate has been around forso long.
Absolutely yeah, we're notreinventing the wheel here.
This is you know, this has beendone before modeling what works
.
But then how do you?
Okay, now it's time to standout.
My cleaner, for example, textedme the other day and was like
you know, I've never had a bossthat cares as much as you do.
(38:05):
She said that.
She texted me, said that, yeah,and that's well, guess what
that's gonna do?
She's now gonna make the uniteven better.
Yeah, now, if the guest isgonna have a problem, she's
gonna go.
Can I actually go help themright now?
Yeah, and she's done it.
Yeah, you know, and that's whatmakes a truly distinct, unique,
like a value proposition.
(38:26):
That is what makes, that's whatdifferentiates us, and it all
stems from that.
Oh my gosh, you're the bestemployer.
I'm gonna make sure that Iperform.
Speaker 1 (38:35):
Yeah, you get an extra measure out of a devoted
employee.
Yes, I had a similar thing withan employee on the Moab Resort
where some guests didn'tdisclose the number of people in
their party.
I'm expecting seven people.
They show up with 14 people andthe unit wasn't equipped for 14
(38:56):
people.
But what did we do?
I call up my one guy who livesnearby and said hey, we need to
move a couch.
It was 1230 at night.
They were checking in aftermidnight.
He gets out his bed, he comesover and he and I move a couch
into this unit, so they have aqueen sleeper and they have two
extra twin mattresses and wejust we just rolled with it.
But you do not get that levelof committed devotion out of
(39:21):
staff.
If you're not showing upleading with love, if they don't
know that you absolutely lovethem as family, you're never
going to get that.
Speaker 2 (39:31):
So that's an exciting thing.
Speaker 1 (39:32):
It's something that feels really good.
You know when you're, whenyou're getting that type of
response.
Yeah, I think, I think we've.
I mean we.
There's a hundred more thingswe could talk about real estate,
but I feel like we're.
Speaker 2 (39:48):
Is there something else you wanted to?
Speaker 1 (39:49):
hit here in real estate part two.
Speaker 2 (39:50):
Yeah, my thought is hey look, this is real estate
one on one.
Here's kind of the brief.
This is you know, and we couldgo for hours and talk and I
think you know, and you couldabsolutely and I could just pick
your brain, you know and youknow.
But but I think we're going todive into a lot of more, even
more granular specifics of eachasset class and, and even more
(40:13):
so, with other different avenuesthat are that are, you know, in
the process of what it takes.
So I think we probably call ithere and continue into you know,
diving a little bit deeperthroughout next few episodes and
onward.
That sounds good.
Speaker 1 (40:27):
Thank you, guys for tuning in Again.
Aston Incorporated.
We appreciate your support.
Have a good night.
We'll catch you on the nextepisode.
Thanks, guys.
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