January 29, 2025 • 34 mins
Click here for the Episode Transcript
ABOUT WILL MATHESON
Will Matheson is the co-founder of Matheson Capital, a real estate investment firm based in Charleston, South Carolina. Prior to forming Matheson Capital, founders Will and Evan worked as commercial brokers for Marcus & Millichap in Raleigh, NC. In just two years, they completed over 50 investment sales transactions totaling over $200 million as a part of the region's top team. Since the start of 2018, they have completed over 16 acquisitions, and have over $100 million of multifamily assets under management.
THIS TOPIC IN A NUTSHELL:
· Will’s journey into Real Estate and Matheson Capital
· First significant venture as an investor
· Advantages of being a broker and investor
· Acquiring properties off-market
· Target Market and Networking Strategies
· Advantages of using the MLS for acquisitions
· The role of value-add strategies
· Importance of Interior Renovations
· Matheson Capital's Current Status and Future Plans
· Identifying New Opportunities
· Selling assets at the right time
· Importance of short-term holds for building credibility
· Profitability of property management
· Connect with Will
KEY QUOTE:
“Cold calling and dealing with constant rejection really translates nicely to raising equity because you will get rejected by a lot of investors.”
SUMMARY OF BUSINESS:
Matheson Capital is a real estate investment firm based in Charleston, South Carolina. Through value-add strategies and a focus on the Southeast, we strive to deliver above-market returns. Since the start of 2018, we have completed over a dozen acquisitions and realized a weighted average investor return of 40%.
ABOUT THE WESTSIDE INVESTORS NETWORK
The Westside Investors Network is your community for investing knowledge for growth. For real estate professionals by real estate professionals. This show is focused on the next step in your career... investing, for those starting with nothing to multifamily syndication.
The Westside Investors Network strives to bring knowledge and education to real estate professionals that is seeking to gain more freedom in their life. The host AJ and Chris Shepard, are committed to sharing the wealth of knowledge that they have gained throughout the years to allow others the opportunity to learn and grow in their investing. They own Uptown Properties, a successful Property Management, and Brokerage Company. If you are interested in Property Management in the Portland Metro or Bend Metro Areas, please visit www.uptownpm.com. If you are interested in investing in multifamily syndication, please visit www.uptownsyndication.com.
#RealEstateInvesting #RealEstate #AparmentInvesting #AssetManagement #CashFlow #Broker #Syndicator #Multifamily #Acquisition #ValueAdd #BrokerageBusiness #MultifamilySyndication #CommercialBrokers #MarcusAndMillichap #Charleston #ClosingDeals #CreatingWealth #BrokersJourneyToSyndication #MathesonCapital #InvestorReturns #RealEstateInvestments #SouthEast #RiskAdjustedReturns #InvestmentOpportunities #SteadyCashF
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Episode Transcript
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Intro speaker (00:03):
Welcome to the Westside Investors Network. Win,
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Trent Werner (00:40):
Welcome back to another episode of the Deal Deep
Dive segment on the WestsideInvestors Network podcast. I'm
your host, Trent Werner. In thissegment, our featured guests
will share their unique storieson a specific deal they've
invested in. We will dive deepinto finding the deal, financing
the deal, writing an offer, andthe due diligence. Do us a solid
and smash that subscribe button,leave us a rating, and share
(01:03):
this episode.
And now, let's dive deep.Welcome back to the Westside
Investors Network podcast. I'myour host, Trent Werner. On
today's episode, we're joined byWill Mathison, Mathison Capital.
Based out of South Carolina,Will and his twin brother run
and own Mathison Capital.
They currently have over a$100,000,000 in assets under
(01:24):
management. And today, we'regonna hear about Will's journey
from starting as a broker with acommercial brokerage and turning
that into a multifamilysyndication that owns over a
$100,000,000 in real estate. Nowlet's welcome Will Mathison.
Alright, Will Mathison joiningthe Westside Investors Network
podcast today. Will, thanks forthanks for hopping on and
(01:46):
chatting with us.
Will Matheson (01:47):
Thank you for having me, Trent.
Trent Werner (01:49):
So Will Matheson is a cofounder of Matheson
Capital. You wanna give a quickshout out to Mathison Capital
and your guys' your guys'business?
Will Matheson (01:59):
So I run oh, well, I should say, Matheson
Capital is a real estateinvestment firm. We're based in
Charleston. We own in NorthCarolina, South Carolina,
Virginia oh, no. Not Virginia.Georgia into Alabama.
And, you know, we've been buyingsince 2018. Run it with my twin
brother, Evan. That's, that'sthe short version.
Trent Werner (02:19):
I love it. I love when brothers work together in
real estate. That's how ourcompany started. Not my
brothers, but 2 brothers startedUptown Properties, and, I've
seen how the family brotherrelationship can work in real
estate. So that's awesome.
So, Will It's
Will Matheson (02:33):
been great.
Trent Werner (02:34):
You and your brother obviously partnered for
this real estate journey. Didyou guys have the same, I guess,
launchpad or or process to getinto real estate, or what was
your what was your journey toget into real estate?
Will Matheson (02:48):
So, I mean, you know, by by virtue of being
twins, we have had almostentirely the same life
experiences outside of, we wentto different colleges. And out
of college, Evan started workingas a mortgage broker in Marks
and Millichap, or for Marks andMillichap in New Jersey. I, it
(03:08):
took me a while to really find ajob after college, but he ended
up helping me get a job at Marksand Millichap in North Carolina.
A few months into that, he movedfrom New Jersey to North
Carolina. So we were bothbrokers at Marcus and Millichap,
doing retail primarily with alittle student housing, a little
(03:29):
multifamily throughout theCarolinas.
And, you know, we did that for awhile. We were on the top team,
not the lead agents, but the 2ndand third on that team. I wanna
say we did at least 50investment sales transactions
during a 2 year period. And thenwe left to so early 2017, we
(03:51):
left Marks and Millichap. Wewent to Columbia University for
their master's in real estatedevelopment program, 1 year
program, and while we were inthat program, that's when we
started buying, and, that's whenwe started buying real estate,
in part because one of ourclassmates found an opportunity
that we thought was pretty good.
Back in North Carolina, we hadactually placed a hard money
(04:14):
loan that was the founding ofMadison Capital, had an
investor, 1031 exchange,shortfall. They needed a
$1,000,000 quickly, so wethought, why can't we raise it?
Gave us some confidence. So thenwhen one of our classmates was
looking to buy an $800,000property, they needed some
partners, Evan and I gotinvolved, Was that first deal
January 2017, and, that gave us,you know, the loan gave us
(04:39):
confidence, but doing that dealgave us a lot of confidence, and
we eventually said, look, it'shonestly pretty hard to find
jobs right now. When we go outand try to build our own
portfolio, raise money frominvestors, we'll start small,
we'll scale it up over time.
So it's a very long winded wayof saying how we ended up here.
Trent Werner (04:57):
I appreciate it though. So you started with the
duplex. I know you were brokersat Marcus and Millichap. Did any
of those experiences? I'massuming yes.
But what experiences from Marcusand Millichap showed you and
your brother that you can dothis on your own?
Will Matheson (05:14):
So the first the first experience that really
showed us that we could do itwas placing the hard money loan.
Like I mentioned, back in 2015,it must have been around August
2015, one of our investors had avery big 1031 exchange, and
instead of doing all of it intoone property, they split their
(05:34):
exchange. And 30 days or sobefore closing, the second of
the two properties, the lendersaid, hey, look, we're only
gonna give you this much money,left them a $1,000,000 short.
But because we had worked withthem so many times, or I should
say our team had worked withthem so many times, we knew
their full schedule of realestate. We knew they had strong
(05:56):
personal net worths, things likethat.
So when our boss tasked us withgoing to find a hard money loan,
we made a few calls, but then wewere talking one time and we
said, why don't we just go andtry to raise the money? And
that's what we did. That's whatwe did. And that was the first
that that doing that gave us,you know, a lot of confidence in
(06:17):
terms of, hey. We went out.
We found money for this project.We put it down. It was
successful. We held the loanfor, like, 16 months. And the
other thing that I always sayabout being a broker and working
in Marks and Millichap is it hasa few advantages in terms of
getting into the ownership sideof things.
One is you are getting paid tolearn more and more about real
(06:40):
estate. You know? I I don'tthink it's controversial to say
when you're, you know, 23, 24,you don't know a ton about what
you're doing all the time. Idon't think that's a
controversial opinion. Sogetting essentially getting paid
to get an education on, youknow, which investments are
working out, good pricing,underwriting, all that stuff,
(07:00):
it's really helpful.
And as it pertains to what Evanand I do now, cold calling cold
calling for a job and justdealing with the constant
rejection really translatesnicely to raising equity because
you will get rejected by a lotof investors who say, no. I
don't wanna work with you. No.Go get more experience. No.
I don't like this, that, or theother thing, but you just keep
(07:23):
picking up the phone and asking.And that was, those 2 things or
those 3 things really all paidbig dividends for us.
Trent Werner (07:31):
I love the cold calling piece because I agree
completely. I also like how, youknow, you were tasked with this
issue or problem and you had togo solve it in a short amount of
time. And instead of, you know,just putting your tail between
your legs and running away, youyou put your boots on and you
wouldn't figured it out, which Ithink is a very good skill to
(07:51):
have in real estate, especiallyon the investment side, because
most of the time you're going tohave to solve problems. So I
love you bringing that up rightthere. And then the third thing
is, I feel like it's a lot.
I don't want to say easier, butwhen you are getting paid to
learn more about real estate,it's a lot easier to transition
into where you guys are nowinstead of, you know, going and
(08:12):
being an engineer before realestate investing. You because
you're you're getting thoseskills that you're gonna
actually put to use when you dogo out and start your own
capital company or investmentcompany.
Will Matheson (08:23):
Yeah. I mean, I I will say you see quite a few
people, you know, who have beenin, like, the medical field or
some other field where theymight have a really they have a
really good network, and they doteach themselves the real estate
side of things when they'regetting into it, which, you
know, I'll be honest, it'sincredibly impressive to me. We
had, we had kind of the oppositeperspective where we got a
(08:45):
really good real estateeducation from work, but I'll be
honest, the network we didn'tbuild much of an investor
network by being brokers becausewhen you're a broker, you're
talking to a bunch of owners whoare used to owning. They're not
used to being limited partners.So we've only had a handful of
people from our brokerage dayscome in as investors in our
(09:07):
company today.
But like I said, there there'salways trade offs. There's
always there's always a tradeoff, but we got the educational
part of it.
Trent Werner (09:15):
So after the 2 unit, after the duplex, where
did you guys go from there?
Will Matheson (09:20):
So I I can go as we talked before this started, I
can literally go deal by deal inso the duplex was January 2018.
We bought a 6 unit deal in Mayof 2018. Both of those were sold
by the end of 2019. We boughtanother 6 unit deal 29 January
(09:41):
2019, 15 units February 2019, 24units in December of that year,
then we bought 32 units in, Iwant to say, March 20, 2020,
another 32 units in September of2020, and then 69 units in Jan
in, March of 2021. So that wasthat was really the start of all
(10:02):
those properties I just listed.
We only own one of them still.All the rest of them, the
longest hold period I think wehad was 26 months or 28 months,
something to that effect. We arereally focused on short term
hold periods, buying, selling,adding the value, delivering
returns back to investors so wecould show future investors that
(10:25):
nice full cycle. We took thisdeal from start to finish. This
is the return we realized forour investors.
Trent Werner (10:32):
So, I mean, the the unit count that you just
listed out for someone that iswanting to get into larger
multifamily, a k a above 4units, that it sounds like you
snowballed pretty quickly. Twoquestions for you. 1, how did
you do that? And 2, why did youdo that?
Will Matheson (10:51):
So, okay. A lot of reasons there. How did we do
it? I am a big at it's like whatpeople say about having your
first job being your mostimportant job. My general
philosophy has been that if youdon't own anything in real
estate and you want to go outthere and buy it, if you go to
the broker who's listing the$20,000,000 property, they
(11:13):
already know everybody who ownsother similar sized properties
in the market and you have notrack record.
So the only way you're going towin that is by getting really
aggressive on terms oroverpaying. But if you start
buying smaller assets, you know,you buy that 15 unit deal, the
30 unit deal, that does give youcredibility when it comes to
(11:33):
buying the bigger deal. And italso it's also generally a less
competitive area of the marketoftentimes. Maybe this is no
longer the case, but oftentimes,it's the most inefficient part
of the market. So you can do themost in terms of adding value in
those spaces.
So, you know, that's that's whywe started in that space in
(11:55):
terms of how were we able toscale. That was I mean, part of
that really was the fact that weheld the assets for such a short
amount of time. We were able togo to the investors who invested
with with us on our early dealsand say, hey. Look. We did this
deal.
I took it from a to b. Here's mynext project. Do you wanna get
(12:15):
it join me on this one? Do youhave anyone you would recommend
I work with as well? You know,do you have any friends who
might want to invest?
So that was that was all part ofthe strategy.
Trent Werner (12:25):
Yeah. It's interesting that you bring that
up because, you know, like ourdeals, for example, we're
holding for, I think, the theshortest one we've held is 4
years now, maybe almost 4 years.And with you churning and
burning that quickly, a lot ofpeople might think, like, why
are they just flipping all thesedeals? But you were able to show
your track record, and thoseinvestors got the return so fast
(12:47):
that I feel like they were morewilling to refer their friends
to you guys. Am I wrong?
Will Matheson (12:52):
Well, I definitely think that helped. I
mean, there there are otherreasons in it too, and we were
very upfront with our investorsabout this. Like, when when Evan
and I started, we did this fulltime. We we got rid of our
brokerage licenses. We said, youknow, we burned the ships.
We said this is what we're gonnado, which was a huge step back
financially. We made good moneyin brokerage, but and, you know,
(13:14):
when you buy a $1,000,000 deal,the acquisition fee isn't really
doing a lot. So part of thequick movement was to generate
acquisition fees but alsogenerate promotes. And, you
know, like I said, we are veryupfront with our investors about
that. We had an incentive plan.
The higher the IRRs we couldget, the more returns we could
(13:35):
get. So that was definitely apart of it. And, yes, to your
point, today, when we work onprojects today, we really do put
more of a focus on cash flow andconsistent dividends to
investors. But when we gotstarted, our philosophy was the
way that we're gonna grow thiscompany and grow our the size of
(13:56):
our investments is not gonna beby telling a new investor, hey,
we've made our quarterlydistribution in the last 12
quarters. We wanted somethingthat was gonna jump off the page
a little bit more of, hey, ourLPs are getting a 40% return in
a year.
And we think that worked out,but like I said, you know, we we
do put more of a focus now onthat long term 3, 5, 7 year hold
(14:20):
cash flowing asset.
Trent Werner (14:21):
Yeah. And I and I I wanna go back to this this, I
guess, goal that a lot of peoplehave of going from 2 units to a
15 unit building. In certainmarkets, you know, that price
point is higher than othermarkets. And so for a lot of
people, when they hear 15 units,that might be $2,000,000,
(14:42):
$3,000,000 How would someone goabout getting to that 15 unit
level if they think that it'sjust not feasibly financial or
financially feasible?
Will Matheson (14:57):
So from very early on, we were working with
outside investors, whichobviously makes scale easier if
you can raise money from otherpeople, you have more resources
to deploy elsewhere. So it's abig part of it. But, you know,
being being direct and goingback to the backstory, I was
telling you, Evan and I, wespent a year in New York in grad
(15:21):
school, and we left we left NewYork in part because we said to
ourselves, you know, we're 25,we're 26 when we graduated.
We're not gonna be able to raisetens of 1,000,000 of dollars.
You know?
This is this isn't tech. Peopledon't give tens of 1,000,000 of
dollars to 25 year olds. We needto we need to go to a place
(15:45):
where the money will go further.So, you know, we started buying
in the Carolinas, which are verythey're very good markets.
They're very in demand, but it'snot, you know, a $1,000,000 in
our 15 unit deal in SouthCarolina cost $1,150,000.
In New York, maybe we'd be luckyto get a duplex with that money.
(16:08):
So, you know, 2 ways to get it.If you wanna get more scale, you
can go to where price you know,the same price, you can invest
the same amount of money, butit's a lower price per unit or
you can raise money from otherpeople.
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And then my follow-up to that isI know you said you were you
were based out of the Carolinas,still are based out of the
Carolinas, South Carolina bespecific, but you invest all
over the Southeast, you know,and different markets, different
states. How do you go aboutgoing to a different market,
(17:36):
getting into a new market as aninvestor, if you want to make
that, you know, maybe someonewants to make their money go
further, so they need toidentify a new market. How do
you how do you make that happen?
Will Matheson (17:47):
So from 2019 through 2023, we invested in
North and South Carolina. Thosewere those were our primary
areas. I I was raised in SouthCarolina. I've lived in South
Carolina since 2018. But from2014 through to 2017, I lived in
(18:07):
North Carolina, and that's whereI was doing brokerage.
So I got exposure to pretty muchall of the Carolinas markets
during that time. So that iswhere we focused, and we were
able to invest in those marketsbecause we were able to build
really good relationships withbrokers so that most of our
acquisitions were off market.Off market, we weren't in
(18:28):
bidding contests. As far asexpanding outside of the
Carolinas and picking up newmarkets, a lot of that had to do
with just building more and moreof a reputation. The first place
we invested in Georgia wasSavannah, Georgia, which is only
2 hours from Charleston.
Quite frankly, it's closer thanany North Carolina market we'd
(18:48):
been investing in for the last 5years. And the Alabama
acquisition was really just avery opportunistic it was an
opportunistic acquisition, andwe had though we had never
worked with a broker on thatdeal, we were well known to them
and some of their teammatesoutside of Alabama, but their
(19:10):
team in North Carolina, SouthCarolina, and Georgia. So that
really helped us do that aswell.
Trent Werner (19:15):
Okay. So kind of developing that regional
relationship with these theseteams and these brokers and
brokerages that are servicingthose areas.
Will Matheson (19:23):
That's a much more succinct way of putting it.
Trent Werner (19:27):
Because I have people that I've talked with in
the past and we're we're inPortland, Oregon, so it's not a
cheap market by any means. It'snot crazy expensive, but it's
definitely not, you know
Will Matheson (19:36):
It's pretty expensive.
Trent Werner (19:38):
Yeah. It is. But it's, you know, a lot of our our
people that I know here, theywant to get to new markets. We
want to get to new markets. Andso the biggest challenge that
we've seen is developing thoserelationships with brokers where
they're taking us serious, eventhough we have a pretty good
sized portfolio here.
Sometimes a lot of it's hard tobuild those relationships even
(20:00):
when we have a $40,000,000portfolio. You know?
Will Matheson (20:03):
So I'm gonna I'm gonna drill in on that a little
bit. I shall drill on that inmultiple ways going back to our
Carolinas acquisition. So thefirst acquisition we did in
South Carolina was a 15 unitproperty in Summerville, South
Carolina. The next acquisitionwe did was 24 units in
Charlotte. Funny enough, in 2022or sorry, 2020, one of our 32
(20:27):
unit acquisitions was also inSomerville, South Carolina.
The broker on that deal did notrealize we already owned another
asset in that market. He didn'tknow that, but he was aware of
the fact because he knew theseller. He was aware of the fact
that we had bought 24 units inCharlotte. So that even gave us
(20:47):
credibility to buy the asset inSomerville, South Carolina.
Somerville, for those of youdon't who don't know, is part of
the Charleston MSA.
The acquisition we did inSavannah, Georgia was from
Berkadia. Berkadia was thebroker on that deal. We had
bought a deal in in 2023, webought deals in North Carolina
(21:08):
and South Carolina in Berkadia,and we closed on the Georgia
deal with Berkadia in 2024. Andthe Alabama deal, well, that was
brokered by Cushman andWakefield, who I have been
talking to Cushman and Wakefieldsince 2019, but I have never
done a deal with them. Mhmm.
Actually, probably 2018. Butthey're aware of who we are
(21:29):
because we've been active in themarket in the southeast market
more broadly. So, you know, wedid have some credibility with
them. One of the things I alwaystell people though is when it
comes to markets and, you know,you're based in Portland, you're
doing a lot of stuff inPortland, where are you looking
to expand specifically? Like,which market is next, like
(21:51):
Seattle or something like that?
Trent Werner (21:53):
No. No. No. We wanna get to a more business
friendly state market, you know,southeastern region. I
personally like the Midwest, butmy partners don't.
But you know, some a state or anarea that is less tenant favored
and, you know, because we getkinda handcuffed with the
landlord tenant laws here. Andthis is not your concern.
Will Matheson (22:14):
Do you have a specific market you're
targeting?
Trent Werner (22:17):
Yeah. I mean, we've looked at Georgia. We've
looked at Florida. I'd sayGeorgia is probably higher on
our list than Florida now, butGeorgia too is one example.
Will Matheson (22:25):
Yeah. So one of the things I always tell people
is it's better to have a networkthat's a mile or, I should say
it, an inch wide and a mile deepthan it is to have one that's a
mile wide and an inch deep. Iknow plenty of groups that, you
know, they'll get on every majorbrokerages mailing list and
every deal. It could be inCalifornia. It could be in
(22:47):
Omaha.
It could be in the northeast. Itcould be in the southeast. They
wanna underwrite it and talk tothe broker and all these things.
But speaking as a former brokerand a guy who talks to brokers
all the time, if you're justcalling, you know, once a month,
once every 3 months, it couldeven be once a week, and it's
like, hey. I wanna know aboutthis deal.
Hey. I wanna know about thisdeal. Hey. I wanna know about
this deal. But you don't ownanything in the market.
(23:09):
They're gonna forget about you.They're not gonna give you too
much time a day, and that's nota knock on brokers. It's just
they receive a ton of thesecalls. They receive a ton of
these calls. So when we gotstarted, you know, we were
focused specifically on theCarolinas.
And that focus, like Imentioned, that's what allowed
us to get the deal in Georgia,and that's really what allowed
(23:31):
us to get the deal in Alabama aswell.
Trent Werner (23:33):
And I know earlier you mentioned, and I've heard
this plenty of times, but whenyou're when you're new and just
starting out, you know, a lot ofbrokers aren't going to give you
the time of day unless you havefavorable terms or you overpay
for it. How are you able toaccomplish that first deal in
Carolina or in South Carolinawithout buying a bad deal?
Will Matheson (23:54):
So funny enough, the the first deal the first
acquisition was in North or the1st Carolinas acquisition,
January 2019, that was in Boone,North Carolina, and I actually
bought it with the help of myformer boss and his team. They
were the buy side broker on thatdeal. But the first acquisition
(24:15):
we did in South Carolina, webought for 1.15. I actually had
it under contract at 1.25 a fewmonths before we bought it, and
I terminated the contract, andit came back around. So the
first time, I think we weregonna overpay.
But the honest answer is thatdeal was on the MLS. It wasn't
on LoopNet. It wasn't with amajor firm. Like, it wasn't with
(24:37):
the CBREs or Cushman andWakefields of the world. We we
found it on the MLS, which Ithink is a great place to go.
Sometimes, the properties willbe terribly overpriced.
Sometimes, they'll be pricedright, but sometimes, they'll be
underpriced. It's really aboutfinding the least efficient
point in the market, and mostpeople who are trying to buy
multifamily aren't looking onrealtor.com. They're looking on
(24:59):
LoopNet. They're looking at allthe other sites.
So, you know, that thatobviously helped. But another
thing that's worth pointing outis when you're dealing with your
Berkadias, your CBREs, yourJLLs, they're typically doing a
whole, you know, full marketingprocess, tours, call to offers,
everything like that. If you'redealing with, oftentimes,
(25:20):
LoopNet or MLS or realtor.com,it's coming on a 1st come, 1st
served basis. You know, like,they're not running a strict
process, so you're often not putin that position where you need
to outbid everybody else. Youjust need to submit an offer and
start engaging with the seller.
Trent Werner (25:39):
You know, out of all the times that I've asked
that question to people on onthis show, that's the first time
I have heard someone mention theMLS and and going to the MLS.
And I don't know how I haven'tsaid that before because we've
actually purchased deals fromthe MLS in the same Oh,
Will Matheson (25:54):
you're trying to keep it a secret, you know?
Trent Werner (25:56):
Yeah. But that no. That's that is great insight.
And it's something, like I said,we haven't talked about before.
It's something we've done.
But instead of just goingstraight to the the heavy
hitters, the JLLs, theCushman's, all those, Go find
someone that could give youaccess to the local MLS and see
what pops up. That's a greatidea.
Will Matheson (26:14):
I mean, realtor.com will give you access
to almost the whole of the MLS.The first two acquisitions we
did in South Carolina wereessentially listings from
residential real estate agentsor commercial agents at
residential real estate firms,which you do run into from time
to time. And I I think that's apretty favorable place to be if
(26:38):
you can bring a certain level ofsophistication to it. I don't
mean that as a knock, but, youknow, it's, you know, like I
said, I've seen plenty ofproperties there that do sell at
good prices. We just happen tothink that we got pretty good
acquisitions on those.
And to be honest, there was aperiod of for probably 4 plus
years, I was signed up for,like, realtor.com alerts for 10
(27:03):
different markets throughout thelike, in Raleigh, Charlotte,
Savannah, Charleston,Charlottesville, Virginia. I had
realtor.com notifications forall of those markets. And every
now and then you'd see a goodopportunity and you might not
win it. But I wasn't going tosee it otherwise.
Trent Werner (27:21):
Yeah. No. I like I said, that is that is great
advice and a great strategy todeploy if you're wanting to get
to new markets on that, youknow, smaller unit count level.
Well, I have a question for youin terms of your value add
plans, and we don't have tohammer too far into it, but I
know you invest in value addreal estate. What does a typical
(27:41):
value add plan look like for youon this, you know, 5 to 70 unit
project that you've worked on inthe past?
Will Matheson (27:50):
So I'll be I'll be pretty direct about that. We
don't we don't reinvent thewheel for the most part. I know
a lot of groups go in there andthey're like, we need to
completely redo the exteriors.We need to rename the
properties. We need to do x, y,and z.
When we were doing our earlystuff, our approach was
essentially, we're gonna buy theplace, we're gonna focus pretty
(28:14):
much all of our efforts on doinginterior renovations, you know,
new flooring, repainting it,countertops, appliances. Again,
not not rocket science by anymeans because those are the
things that are going to havethe most they're going to
instantly drive the value. It's,you know, you can tell when a
property hasn't been renovatedsince 1976. You can tell, and it
(28:38):
really drives rent a lot whenyou can go out there and show
and show renters, like, hey,look, you know, you could have
this old dated brown woodinterior that looks like, you
know, That 70 Show, or you couldgo with, you know, this nice new
stainless steel, etcetera,etcetera, and it's gonna cost
you $300 more or whatever theprice difference may be. And
(29:01):
people go for that, but, youknow, we didn't reinvent the
wheel on that stuff.
And, you know, if we could avoidit, we were going to avoid doing
like down to the studs,replumbing the whole property,
things like that.
Trent Werner (29:12):
It's interesting. Well, and I mean, I agree
completely with that. If aproperty hasn't been updated
since, you know, the seventies,eighties, are you is there any
focus on exterior and curbappeal and that kind of thing?
Will Matheson (29:27):
Some assets, we did that. Others, we didn't. I
remember one property, you know,we we went out and we were like
adding dog parks and we renamedit from Central Quarters to
Central Oaks because I thoughtCentral Quarter sounded like a
prison. Yeah. But, no, by andlarge, I mean, when we were
getting started, we were justvery we were just very inter
(29:50):
internally focused.
Now I will be honest. You know?We probably would have been
better off doing some of theexterior work. I've seen some of
the assets we've sold. They'vebeen repainted.
I don't know how much they drovethe rents, but property sure
does look better from thestreet.
Trent Werner (30:05):
Yeah. Well, and I appreciate that because, you
know, everyone has a little bitdifferent strategy when it comes
to value add, especially theconstruction piece. What about
the operational side of valueadd in terms of management, you
know, rubs, utilities, all thatstuff? Were you were you focused
at all on that?
Will Matheson (30:23):
I mean, we obviously cared about it. One of
the I'm torn as to whether ornot I regret this. Some days I
do, some days I don't. From thevery beginning, we were hiring
3rd party property managers, andthere is a part of me, at least
for the assets we owned in SouthCarolina, part of me wishes we'd
under manage those because youwould learn so much and, let's
(30:46):
be honest, way to supplementyour income, when you're getting
started. But we always used 3rdparty property managers.
Not too much to say about that,really.
Trent Werner (30:57):
Yeah. Yeah. And that's that's I feel like it's
kinda 5050 when you're startingout, whether you're hiring 3rd
party. I know a lot of peoplethat maybe aren't full time in
this business yet. They arehiring 3rd party and that can
build deals sometimes.
That's why I brought it up tosee if it obviously it didn't
hurt you guys too bad to hirethird party managers.
Will Matheson (31:19):
I mean, I fired people. You know? I fired
property managers on these firstfew deals. They didn't all work
out, but some did, some didn't.It is harder to find consistent
management in a smaller space,primarily because people aren't
on-site.
(31:40):
You know, it's it's not a knockon any management company, but
it's harder to manage stuff whenyou don't have on-site personnel
dedicated to your property,which is essentially impossible,
significantly below the 100 unitrange.
Trent Werner (31:54):
Yeah. Well, I have another question for you, Will.
Where is Matheson Capital attoday, and where do you guys see
yourself going here in the next12 to 18 months?
Will Matheson (32:05):
So today, we have approximately $100,000,000 of
assets under management. Thisyear alone, we've done over
$50,000,000 of acquisitions.Where do we plan on going in the
next 12 to 18 months? The goalis always the same. The goal is
always to do more.
You know, we're analyzingproperties every single day
(32:25):
looking for the nextopportunity. So the goal is just
more. I I can't be any morespecific than that.
Trent Werner (32:32):
Well, I appreciate your honesty. Will, where can
people hear more from you,connect with you, and and find
out more about Matheson Capital?
Will Matheson (32:40):
The best places to connect with me are probably
the best one is probablyLinkedIn, Will Matheson. I'm
reasonably easy to find. Andalternatively, if you go to our
website which iswww.mathcap.com, you know, you
can join our mailing list. Youif you do that, you'll get an
instant email that essentiallyinvites you to schedule a call.
(33:03):
I try to connect with everybodywho joins our mailing list so I
can talk to them, see how we canpotentially work together, what
type of help we can give.
So those are the best 2, eitherLinkedIn or mathcap.com.
Trent Werner (33:15):
Very nice. We'll make sure that those are linked
down below. Will, thank you somuch for taking the time to
share your career in MathesonCapital's journey.
Will Matheson (33:22):
Yeah. Thank you for having me, Trent.
Intro speaker (33:24):
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Trent Werner (00:40):
Welcome back to another episode of the Deal Deep
Dive segment on the WestsideInvestors Network podcast. I'm
your host, Trent Werner. In thissegment, our featured guests
will share their unique storieson a specific deal they've
invested in. We will dive deepinto finding the deal, financing
the deal, writing an offer, andthe due diligence. Do us a solid
and smash that subscribe button,leave us a rating, and share
(01:03):
this episode.
And now, let's dive deep.Welcome back to the Westside
Investors Network podcast. I'myour host, Trent Werner. On
today's episode, we're joined byWill Mathison, Mathison Capital.
Based out of South Carolina,Will and his twin brother run
and own Mathison Capital.
They currently have over a$100,000,000 in assets under
(01:24):
management. And today, we'regonna hear about Will's journey
from starting as a broker with acommercial brokerage and turning
that into a multifamilysyndication that owns over a
$100,000,000 in real estate. Nowlet's welcome Will Mathison.
Alright, Will Mathison joiningthe Westside Investors Network
podcast today. Will, thanks forthanks for hopping on and
(01:46):
chatting with us.
Will Matheson (01:47):
Thank you for having me, Trent.
Trent Werner (01:49):
So Will Matheson is a cofounder of Matheson
Capital. You wanna give a quickshout out to Mathison Capital
and your guys' your guys'business?
Will Matheson (01:59):
So I run oh, well, I should say, Matheson
Capital is a real estateinvestment firm. We're based in
Charleston. We own in NorthCarolina, South Carolina,
Virginia oh, no. Not Virginia.Georgia into Alabama.
And, you know, we've been buyingsince 2018. Run it with my twin
brother, Evan. That's, that'sthe short version.
Trent Werner (02:19):
I love it. I love when brothers work together in
real estate. That's how ourcompany started. Not my
brothers, but 2 brothers startedUptown Properties, and, I've
seen how the family brotherrelationship can work in real
estate. So that's awesome.
So, Will It's
Will Matheson (02:33):
been great.
Trent Werner (02:34):
You and your brother obviously partnered for
this real estate journey. Didyou guys have the same, I guess,
launchpad or or process to getinto real estate, or what was
your what was your journey toget into real estate?
Will Matheson (02:48):
So, I mean, you know, by by virtue of being
twins, we have had almostentirely the same life
experiences outside of, we wentto different colleges. And out
of college, Evan started workingas a mortgage broker in Marks
and Millichap, or for Marks andMillichap in New Jersey. I, it
(03:08):
took me a while to really find ajob after college, but he ended
up helping me get a job at Marksand Millichap in North Carolina.
A few months into that, he movedfrom New Jersey to North
Carolina. So we were bothbrokers at Marcus and Millichap,
doing retail primarily with alittle student housing, a little
(03:29):
multifamily throughout theCarolinas.
And, you know, we did that for awhile. We were on the top team,
not the lead agents, but the 2ndand third on that team. I wanna
say we did at least 50investment sales transactions
during a 2 year period. And thenwe left to so early 2017, we
(03:51):
left Marks and Millichap. Wewent to Columbia University for
their master's in real estatedevelopment program, 1 year
program, and while we were inthat program, that's when we
started buying, and, that's whenwe started buying real estate,
in part because one of ourclassmates found an opportunity
that we thought was pretty good.
Back in North Carolina, we hadactually placed a hard money
(04:14):
loan that was the founding ofMadison Capital, had an
investor, 1031 exchange,shortfall. They needed a
$1,000,000 quickly, so wethought, why can't we raise it?
Gave us some confidence. So thenwhen one of our classmates was
looking to buy an $800,000property, they needed some
partners, Evan and I gotinvolved, Was that first deal
January 2017, and, that gave us,you know, the loan gave us
(04:39):
confidence, but doing that dealgave us a lot of confidence, and
we eventually said, look, it'shonestly pretty hard to find
jobs right now. When we go outand try to build our own
portfolio, raise money frominvestors, we'll start small,
we'll scale it up over time.
So it's a very long winded wayof saying how we ended up here.
Trent Werner (04:57):
I appreciate it though. So you started with the
duplex. I know you were brokersat Marcus and Millichap. Did any
of those experiences? I'massuming yes.
But what experiences from Marcusand Millichap showed you and
your brother that you can dothis on your own?
Will Matheson (05:14):
So the first the first experience that really
showed us that we could do itwas placing the hard money loan.
Like I mentioned, back in 2015,it must have been around August
2015, one of our investors had avery big 1031 exchange, and
instead of doing all of it intoone property, they split their
(05:34):
exchange. And 30 days or sobefore closing, the second of
the two properties, the lendersaid, hey, look, we're only
gonna give you this much money,left them a $1,000,000 short.
But because we had worked withthem so many times, or I should
say our team had worked withthem so many times, we knew
their full schedule of realestate. We knew they had strong
(05:56):
personal net worths, things likethat.
So when our boss tasked us withgoing to find a hard money loan,
we made a few calls, but then wewere talking one time and we
said, why don't we just go andtry to raise the money? And
that's what we did. That's whatwe did. And that was the first
that that doing that gave us,you know, a lot of confidence in
(06:17):
terms of, hey. We went out.
We found money for this project.We put it down. It was
successful. We held the loanfor, like, 16 months. And the
other thing that I always sayabout being a broker and working
in Marks and Millichap is it hasa few advantages in terms of
getting into the ownership sideof things.
One is you are getting paid tolearn more and more about real
(06:40):
estate. You know? I I don'tthink it's controversial to say
when you're, you know, 23, 24,you don't know a ton about what
you're doing all the time. Idon't think that's a
controversial opinion. Sogetting essentially getting paid
to get an education on, youknow, which investments are
working out, good pricing,underwriting, all that stuff,
(07:00):
it's really helpful.
And as it pertains to what Evanand I do now, cold calling cold
calling for a job and justdealing with the constant
rejection really translatesnicely to raising equity because
you will get rejected by a lotof investors who say, no. I
don't wanna work with you. No.Go get more experience. No.
I don't like this, that, or theother thing, but you just keep
(07:23):
picking up the phone and asking.And that was, those 2 things or
those 3 things really all paidbig dividends for us.
Trent Werner (07:31):
I love the cold calling piece because I agree
completely. I also like how, youknow, you were tasked with this
issue or problem and you had togo solve it in a short amount of
time. And instead of, you know,just putting your tail between
your legs and running away, youyou put your boots on and you
wouldn't figured it out, which Ithink is a very good skill to
(07:51):
have in real estate, especiallyon the investment side, because
most of the time you're going tohave to solve problems. So I
love you bringing that up rightthere. And then the third thing
is, I feel like it's a lot.
I don't want to say easier, butwhen you are getting paid to
learn more about real estate,it's a lot easier to transition
into where you guys are nowinstead of, you know, going and
(08:12):
being an engineer before realestate investing. You because
you're you're getting thoseskills that you're gonna
actually put to use when you dogo out and start your own
capital company or investmentcompany.
Will Matheson (08:23):
Yeah. I mean, I I will say you see quite a few
people, you know, who have beenin, like, the medical field or
some other field where theymight have a really they have a
really good network, and they doteach themselves the real estate
side of things when they'regetting into it, which, you
know, I'll be honest, it'sincredibly impressive to me. We
had, we had kind of the oppositeperspective where we got a
(08:45):
really good real estateeducation from work, but I'll be
honest, the network we didn'tbuild much of an investor
network by being brokers becausewhen you're a broker, you're
talking to a bunch of owners whoare used to owning. They're not
used to being limited partners.So we've only had a handful of
people from our brokerage dayscome in as investors in our
(09:07):
company today.
But like I said, there there'salways trade offs. There's
always there's always a tradeoff, but we got the educational
part of it.
Trent Werner (09:15):
So after the 2 unit, after the duplex, where
did you guys go from there?
Will Matheson (09:20):
So I I can go as we talked before this started, I
can literally go deal by deal inso the duplex was January 2018.
We bought a 6 unit deal in Mayof 2018. Both of those were sold
by the end of 2019. We boughtanother 6 unit deal 29 January
(09:41):
2019, 15 units February 2019, 24units in December of that year,
then we bought 32 units in, Iwant to say, March 20, 2020,
another 32 units in September of2020, and then 69 units in Jan
in, March of 2021. So that wasthat was really the start of all
(10:02):
those properties I just listed.
We only own one of them still.All the rest of them, the
longest hold period I think wehad was 26 months or 28 months,
something to that effect. We arereally focused on short term
hold periods, buying, selling,adding the value, delivering
returns back to investors so wecould show future investors that
(10:25):
nice full cycle. We took thisdeal from start to finish. This
is the return we realized forour investors.
Trent Werner (10:32):
So, I mean, the the unit count that you just
listed out for someone that iswanting to get into larger
multifamily, a k a above 4units, that it sounds like you
snowballed pretty quickly. Twoquestions for you. 1, how did
you do that? And 2, why did youdo that?
Will Matheson (10:51):
So, okay. A lot of reasons there. How did we do
it? I am a big at it's like whatpeople say about having your
first job being your mostimportant job. My general
philosophy has been that if youdon't own anything in real
estate and you want to go outthere and buy it, if you go to
the broker who's listing the$20,000,000 property, they
(11:13):
already know everybody who ownsother similar sized properties
in the market and you have notrack record.
So the only way you're going towin that is by getting really
aggressive on terms oroverpaying. But if you start
buying smaller assets, you know,you buy that 15 unit deal, the
30 unit deal, that does give youcredibility when it comes to
(11:33):
buying the bigger deal. And italso it's also generally a less
competitive area of the marketoftentimes. Maybe this is no
longer the case, but oftentimes,it's the most inefficient part
of the market. So you can do themost in terms of adding value in
those spaces.
So, you know, that's that's whywe started in that space in
(11:55):
terms of how were we able toscale. That was I mean, part of
that really was the fact that weheld the assets for such a short
amount of time. We were able togo to the investors who invested
with with us on our early dealsand say, hey. Look. We did this
deal.
I took it from a to b. Here's mynext project. Do you wanna get
(12:15):
it join me on this one? Do youhave anyone you would recommend
I work with as well? You know,do you have any friends who
might want to invest?
So that was that was all part ofthe strategy.
Trent Werner (12:25):
Yeah. It's interesting that you bring that
up because, you know, like ourdeals, for example, we're
holding for, I think, the theshortest one we've held is 4
years now, maybe almost 4 years.And with you churning and
burning that quickly, a lot ofpeople might think, like, why
are they just flipping all thesedeals? But you were able to show
your track record, and thoseinvestors got the return so fast
(12:47):
that I feel like they were morewilling to refer their friends
to you guys. Am I wrong?
Will Matheson (12:52):
Well, I definitely think that helped. I
mean, there there are otherreasons in it too, and we were
very upfront with our investorsabout this. Like, when when Evan
and I started, we did this fulltime. We we got rid of our
brokerage licenses. We said, youknow, we burned the ships.
We said this is what we're gonnado, which was a huge step back
financially. We made good moneyin brokerage, but and, you know,
(13:14):
when you buy a $1,000,000 deal,the acquisition fee isn't really
doing a lot. So part of thequick movement was to generate
acquisition fees but alsogenerate promotes. And, you
know, like I said, we are veryupfront with our investors about
that. We had an incentive plan.
The higher the IRRs we couldget, the more returns we could
(13:35):
get. So that was definitely apart of it. And, yes, to your
point, today, when we work onprojects today, we really do put
more of a focus on cash flow andconsistent dividends to
investors. But when we gotstarted, our philosophy was the
way that we're gonna grow thiscompany and grow our the size of
(13:56):
our investments is not gonna beby telling a new investor, hey,
we've made our quarterlydistribution in the last 12
quarters. We wanted somethingthat was gonna jump off the page
a little bit more of, hey, ourLPs are getting a 40% return in
a year.
And we think that worked out,but like I said, you know, we we
do put more of a focus now onthat long term 3, 5, 7 year hold
(14:20):
cash flowing asset.
Trent Werner (14:21):
Yeah. And I and I I wanna go back to this this, I
guess, goal that a lot of peoplehave of going from 2 units to a
15 unit building. In certainmarkets, you know, that price
point is higher than othermarkets. And so for a lot of
people, when they hear 15 units,that might be $2,000,000,
(14:42):
$3,000,000 How would someone goabout getting to that 15 unit
level if they think that it'sjust not feasibly financial or
financially feasible?
Will Matheson (14:57):
So from very early on, we were working with
outside investors, whichobviously makes scale easier if
you can raise money from otherpeople, you have more resources
to deploy elsewhere. So it's abig part of it. But, you know,
being being direct and goingback to the backstory, I was
telling you, Evan and I, wespent a year in New York in grad
(15:21):
school, and we left we left NewYork in part because we said to
ourselves, you know, we're 25,we're 26 when we graduated.
We're not gonna be able to raisetens of 1,000,000 of dollars.
You know?
This is this isn't tech. Peopledon't give tens of 1,000,000 of
dollars to 25 year olds. We needto we need to go to a place
(15:45):
where the money will go further.So, you know, we started buying
in the Carolinas, which are verythey're very good markets.
They're very in demand, but it'snot, you know, a $1,000,000 in
our 15 unit deal in SouthCarolina cost $1,150,000.
In New York, maybe we'd be luckyto get a duplex with that money.
(16:08):
So, you know, 2 ways to get it.If you wanna get more scale, you
can go to where price you know,the same price, you can invest
the same amount of money, butit's a lower price per unit or
you can raise money from otherpeople.
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uptownsyndication.com today tolearn more. That's that's great
advice.
And then my follow-up to that isI know you said you were you
were based out of the Carolinas,still are based out of the
Carolinas, South Carolina bespecific, but you invest all
over the Southeast, you know,and different markets, different
states. How do you go aboutgoing to a different market,
(17:36):
getting into a new market as aninvestor, if you want to make
that, you know, maybe someonewants to make their money go
further, so they need toidentify a new market. How do
you how do you make that happen?
Will Matheson (17:47):
So from 2019 through 2023, we invested in
North and South Carolina. Thosewere those were our primary
areas. I I was raised in SouthCarolina. I've lived in South
Carolina since 2018. But from2014 through to 2017, I lived in
(18:07):
North Carolina, and that's whereI was doing brokerage.
So I got exposure to pretty muchall of the Carolinas markets
during that time. So that iswhere we focused, and we were
able to invest in those marketsbecause we were able to build
really good relationships withbrokers so that most of our
acquisitions were off market.Off market, we weren't in
(18:28):
bidding contests. As far asexpanding outside of the
Carolinas and picking up newmarkets, a lot of that had to do
with just building more and moreof a reputation. The first place
we invested in Georgia wasSavannah, Georgia, which is only
2 hours from Charleston.
Quite frankly, it's closer thanany North Carolina market we'd
(18:48):
been investing in for the last 5years. And the Alabama
acquisition was really just avery opportunistic it was an
opportunistic acquisition, andwe had though we had never
worked with a broker on thatdeal, we were well known to them
and some of their teammatesoutside of Alabama, but their
(19:10):
team in North Carolina, SouthCarolina, and Georgia. So that
really helped us do that aswell.
Trent Werner (19:15):
Okay. So kind of developing that regional
relationship with these theseteams and these brokers and
brokerages that are servicingthose areas.
Will Matheson (19:23):
That's a much more succinct way of putting it.
Trent Werner (19:27):
Because I have people that I've talked with in
the past and we're we're inPortland, Oregon, so it's not a
cheap market by any means. It'snot crazy expensive, but it's
definitely not, you know
Will Matheson (19:36):
It's pretty expensive.
Trent Werner (19:38):
Yeah. It is. But it's, you know, a lot of our our
people that I know here, theywant to get to new markets. We
want to get to new markets. Andso the biggest challenge that
we've seen is developing thoserelationships with brokers where
they're taking us serious, eventhough we have a pretty good
sized portfolio here.
Sometimes a lot of it's hard tobuild those relationships even
(20:00):
when we have a $40,000,000portfolio. You know?
Will Matheson (20:03):
So I'm gonna I'm gonna drill in on that a little
bit. I shall drill on that inmultiple ways going back to our
Carolinas acquisition. So thefirst acquisition we did in
South Carolina was a 15 unitproperty in Summerville, South
Carolina. The next acquisitionwe did was 24 units in
Charlotte. Funny enough, in 2022or sorry, 2020, one of our 32
(20:27):
unit acquisitions was also inSomerville, South Carolina.
The broker on that deal did notrealize we already owned another
asset in that market. He didn'tknow that, but he was aware of
the fact because he knew theseller. He was aware of the fact
that we had bought 24 units inCharlotte. So that even gave us
(20:47):
credibility to buy the asset inSomerville, South Carolina.
Somerville, for those of youdon't who don't know, is part of
the Charleston MSA.
The acquisition we did inSavannah, Georgia was from
Berkadia. Berkadia was thebroker on that deal. We had
bought a deal in in 2023, webought deals in North Carolina
(21:08):
and South Carolina in Berkadia,and we closed on the Georgia
deal with Berkadia in 2024. Andthe Alabama deal, well, that was
brokered by Cushman andWakefield, who I have been
talking to Cushman and Wakefieldsince 2019, but I have never
done a deal with them. Mhmm.
Actually, probably 2018. Butthey're aware of who we are
(21:29):
because we've been active in themarket in the southeast market
more broadly. So, you know, wedid have some credibility with
them. One of the things I alwaystell people though is when it
comes to markets and, you know,you're based in Portland, you're
doing a lot of stuff inPortland, where are you looking
to expand specifically? Like,which market is next, like
(21:51):
Seattle or something like that?
Trent Werner (21:53):
No. No. No. We wanna get to a more business
friendly state market, you know,southeastern region. I
personally like the Midwest, butmy partners don't.
But you know, some a state or anarea that is less tenant favored
and, you know, because we getkinda handcuffed with the
landlord tenant laws here. Andthis is not your concern.
Will Matheson (22:14):
Do you have a specific market you're
targeting?
Trent Werner (22:17):
Yeah. I mean, we've looked at Georgia. We've
looked at Florida. I'd sayGeorgia is probably higher on
our list than Florida now, butGeorgia too is one example.
Will Matheson (22:25):
Yeah. So one of the things I always tell people
is it's better to have a networkthat's a mile or, I should say
it, an inch wide and a mile deepthan it is to have one that's a
mile wide and an inch deep. Iknow plenty of groups that, you
know, they'll get on every majorbrokerages mailing list and
every deal. It could be inCalifornia. It could be in
(22:47):
Omaha.
It could be in the northeast. Itcould be in the southeast. They
wanna underwrite it and talk tothe broker and all these things.
But speaking as a former brokerand a guy who talks to brokers
all the time, if you're justcalling, you know, once a month,
once every 3 months, it couldeven be once a week, and it's
like, hey. I wanna know aboutthis deal.
Hey. I wanna know about thisdeal. Hey. I wanna know about
this deal. But you don't ownanything in the market.
(23:09):
They're gonna forget about you.They're not gonna give you too
much time a day, and that's nota knock on brokers. It's just
they receive a ton of thesecalls. They receive a ton of
these calls. So when we gotstarted, you know, we were
focused specifically on theCarolinas.
And that focus, like Imentioned, that's what allowed
us to get the deal in Georgia,and that's really what allowed
(23:31):
us to get the deal in Alabama aswell.
Trent Werner (23:33):
And I know earlier you mentioned, and I've heard
this plenty of times, but whenyou're when you're new and just
starting out, you know, a lot ofbrokers aren't going to give you
the time of day unless you havefavorable terms or you overpay
for it. How are you able toaccomplish that first deal in
Carolina or in South Carolinawithout buying a bad deal?
Will Matheson (23:54):
So funny enough, the the first deal the first
acquisition was in North or the1st Carolinas acquisition,
January 2019, that was in Boone,North Carolina, and I actually
bought it with the help of myformer boss and his team. They
were the buy side broker on thatdeal. But the first acquisition
(24:15):
we did in South Carolina, webought for 1.15. I actually had
it under contract at 1.25 a fewmonths before we bought it, and
I terminated the contract, andit came back around. So the
first time, I think we weregonna overpay.
But the honest answer is thatdeal was on the MLS. It wasn't
on LoopNet. It wasn't with amajor firm. Like, it wasn't with
(24:37):
the CBREs or Cushman andWakefields of the world. We we
found it on the MLS, which Ithink is a great place to go.
Sometimes, the properties willbe terribly overpriced.
Sometimes, they'll be pricedright, but sometimes, they'll be
underpriced. It's really aboutfinding the least efficient
point in the market, and mostpeople who are trying to buy
multifamily aren't looking onrealtor.com. They're looking on
(24:59):
LoopNet. They're looking at allthe other sites.
So, you know, that thatobviously helped. But another
thing that's worth pointing outis when you're dealing with your
Berkadias, your CBREs, yourJLLs, they're typically doing a
whole, you know, full marketingprocess, tours, call to offers,
everything like that. If you'redealing with, oftentimes,
(25:20):
LoopNet or MLS or realtor.com,it's coming on a 1st come, 1st
served basis. You know, like,they're not running a strict
process, so you're often not putin that position where you need
to outbid everybody else. Youjust need to submit an offer and
start engaging with the seller.
Trent Werner (25:39):
You know, out of all the times that I've asked
that question to people on onthis show, that's the first time
I have heard someone mention theMLS and and going to the MLS.
And I don't know how I haven'tsaid that before because we've
actually purchased deals fromthe MLS in the same Oh,
Will Matheson (25:54):
you're trying to keep it a secret, you know?
Trent Werner (25:56):
Yeah. But that no. That's that is great insight.
And it's something, like I said,we haven't talked about before.
It's something we've done.
But instead of just goingstraight to the the heavy
hitters, the JLLs, theCushman's, all those, Go find
someone that could give youaccess to the local MLS and see
what pops up. That's a greatidea.
Will Matheson (26:14):
I mean, realtor.com will give you access
to almost the whole of the MLS.The first two acquisitions we
did in South Carolina wereessentially listings from
residential real estate agentsor commercial agents at
residential real estate firms,which you do run into from time
to time. And I I think that's apretty favorable place to be if
(26:38):
you can bring a certain level ofsophistication to it. I don't
mean that as a knock, but, youknow, it's, you know, like I
said, I've seen plenty ofproperties there that do sell at
good prices. We just happen tothink that we got pretty good
acquisitions on those.
And to be honest, there was aperiod of for probably 4 plus
years, I was signed up for,like, realtor.com alerts for 10
(27:03):
different markets throughout thelike, in Raleigh, Charlotte,
Savannah, Charleston,Charlottesville, Virginia. I had
realtor.com notifications forall of those markets. And every
now and then you'd see a goodopportunity and you might not
win it. But I wasn't going tosee it otherwise.
Trent Werner (27:21):
Yeah. No. I like I said, that is that is great
advice and a great strategy todeploy if you're wanting to get
to new markets on that, youknow, smaller unit count level.
Well, I have a question for youin terms of your value add
plans, and we don't have tohammer too far into it, but I
know you invest in value addreal estate. What does a typical
(27:41):
value add plan look like for youon this, you know, 5 to 70 unit
project that you've worked on inthe past?
Will Matheson (27:50):
So I'll be I'll be pretty direct about that. We
don't we don't reinvent thewheel for the most part. I know
a lot of groups go in there andthey're like, we need to
completely redo the exteriors.We need to rename the
properties. We need to do x, y,and z.
When we were doing our earlystuff, our approach was
essentially, we're gonna buy theplace, we're gonna focus pretty
(28:14):
much all of our efforts on doinginterior renovations, you know,
new flooring, repainting it,countertops, appliances. Again,
not not rocket science by anymeans because those are the
things that are going to havethe most they're going to
instantly drive the value. It's,you know, you can tell when a
property hasn't been renovatedsince 1976. You can tell, and it
(28:38):
really drives rent a lot whenyou can go out there and show
and show renters, like, hey,look, you know, you could have
this old dated brown woodinterior that looks like, you
know, That 70 Show, or you couldgo with, you know, this nice new
stainless steel, etcetera,etcetera, and it's gonna cost
you $300 more or whatever theprice difference may be. And
(29:01):
people go for that, but, youknow, we didn't reinvent the
wheel on that stuff.
And, you know, if we could avoidit, we were going to avoid doing
like down to the studs,replumbing the whole property,
things like that.
Trent Werner (29:12):
It's interesting. Well, and I mean, I agree
completely with that. If aproperty hasn't been updated
since, you know, the seventies,eighties, are you is there any
focus on exterior and curbappeal and that kind of thing?
Will Matheson (29:27):
Some assets, we did that. Others, we didn't. I
remember one property, you know,we we went out and we were like
adding dog parks and we renamedit from Central Quarters to
Central Oaks because I thoughtCentral Quarter sounded like a
prison. Yeah. But, no, by andlarge, I mean, when we were
getting started, we were justvery we were just very inter
(29:50):
internally focused.
Now I will be honest. You know?We probably would have been
better off doing some of theexterior work. I've seen some of
the assets we've sold. They'vebeen repainted.
I don't know how much they drovethe rents, but property sure
does look better from thestreet.
Trent Werner (30:05):
Yeah. Well, and I appreciate that because, you
know, everyone has a little bitdifferent strategy when it comes
to value add, especially theconstruction piece. What about
the operational side of valueadd in terms of management, you
know, rubs, utilities, all thatstuff? Were you were you focused
at all on that?
Will Matheson (30:23):
I mean, we obviously cared about it. One of
the I'm torn as to whether ornot I regret this. Some days I
do, some days I don't. From thevery beginning, we were hiring
3rd party property managers, andthere is a part of me, at least
for the assets we owned in SouthCarolina, part of me wishes we'd
under manage those because youwould learn so much and, let's
(30:46):
be honest, way to supplementyour income, when you're getting
started. But we always used 3rdparty property managers.
Not too much to say about that,really.
Trent Werner (30:57):
Yeah. Yeah. And that's that's I feel like it's
kinda 5050 when you're startingout, whether you're hiring 3rd
party. I know a lot of peoplethat maybe aren't full time in
this business yet. They arehiring 3rd party and that can
build deals sometimes.
That's why I brought it up tosee if it obviously it didn't
hurt you guys too bad to hirethird party managers.
Will Matheson (31:19):
I mean, I fired people. You know? I fired
property managers on these firstfew deals. They didn't all work
out, but some did, some didn't.It is harder to find consistent
management in a smaller space,primarily because people aren't
on-site.
(31:40):
You know, it's it's not a knockon any management company, but
it's harder to manage stuff whenyou don't have on-site personnel
dedicated to your property,which is essentially impossible,
significantly below the 100 unitrange.
Trent Werner (31:54):
Yeah. Well, I have another question for you, Will.
Where is Matheson Capital attoday, and where do you guys see
yourself going here in the next12 to 18 months?
Will Matheson (32:05):
So today, we have approximately $100,000,000 of
assets under management. Thisyear alone, we've done over
$50,000,000 of acquisitions.Where do we plan on going in the
next 12 to 18 months? The goalis always the same. The goal is
always to do more.
You know, we're analyzingproperties every single day
(32:25):
looking for the nextopportunity. So the goal is just
more. I I can't be any morespecific than that.
Trent Werner (32:32):
Well, I appreciate your honesty. Will, where can
people hear more from you,connect with you, and and find
out more about Matheson Capital?
Will Matheson (32:40):
The best places to connect with me are probably
the best one is probablyLinkedIn, Will Matheson. I'm
reasonably easy to find. Andalternatively, if you go to our
website which iswww.mathcap.com, you know, you
can join our mailing list. Youif you do that, you'll get an
instant email that essentiallyinvites you to schedule a call.
(33:03):
I try to connect with everybodywho joins our mailing list so I
can talk to them, see how we canpotentially work together, what
type of help we can give.
So those are the best 2, eitherLinkedIn or mathcap.com.
Trent Werner (33:15):
Very nice. We'll make sure that those are linked
down below. Will, thank you somuch for taking the time to
share your career in MathesonCapital's journey.
Will Matheson (33:22):
Yeah. Thank you for having me, Trent.
Intro speaker (33:24):
Thank you for listening to this episode of the
Real Estate ProfessionalsInvesting podcast on Wynn, your
community of investing knowledgefor growth. We hope that this
episode has increased yourknowledge and added value to
your path to freedom. If youwould, please take a second to
rate us so that we can get moregreat investors to interview. If
you or someone that you knowwants to be on, please visit
(33:45):
westsideinvestors.com and fillout our form to be on the show.
Thank you again, and enjoy yourday.
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