So you want to get into multi-family investing, but you don’t have the money or the track record. Maybe you think that baby steps is the way to go, learning the game through single-family rentals or managing a small complex on your own. But if you have the right team, you don’t need to have $5M in the bank or 15 years of property management experience. You can serve as the quarterback and focus your energy on putting together deals, while your mortgage broker, property management company, and general contractor execute the playbook.
Devin Elder was born and raised in San Antonio, Texas. After graduating from UT-San Antonio with a degree in business, he went the corporate route, working in sales and operations for several area companies. But with each promotion, Devin lost a little more time and a little more autonomy. Then he got fired. In that moment, Devin vowed to find an alternative. At about the same time, Devin bought, renovated and refinanced his first single-family rental. Initially skeptical of real estate as a viable investment, he soon realized that the cashflow from rental properties could be his way out.
Two years and 20 doors later, Devin quit his last corporate job and became a full-time investor. Since then, he has shifted his focus to multi-family, working his way from a six-unit that he managed himself to a 75-unit to a 192-unit. Today Devin shares how a desire to scale his real estate business inspired the shift from single- to multi-family and why he takes pride in having a positive impact on the community. He explains the initial lack of confidence that held him back from pursuing multi-family and how he overcame that with the right peer group and a ‘someday is now’ philosophy. Listen in to understand why Devin would pursue entrepreneurship sooner if he could do it all over again, and hear his advice around ‘borrowing credibility’ to jump-start your multi-family business!
Key Takeaways
[2:33] What inspired Devin to leave the corporate world for real estate
- Climbing corporate ladder, lost time/autonomy
- Giving his all, got fired
- Vowed to find alternative
- Single-family investment proved viable
[5:00] Devin’s initial strategy
- Acquire enough cashflow to cover bills
- Put team together, several single-family rentals
- 20 doors in two years
- Moved to tears on last day of work
[7:59] Devin’s shift from single- to multi-family
- Wanted to scale business (5X cashflow)
- Realized multi-family was more feasible
- Banks willing to lend (established business model)
[9:37] Devin’s multi-family starting point
- C-area six-unit bought, managed himself
- Wasn’t ready to take other people’s money
- Friends from local mentor group encouraged bigger deals
[12:17] Devin’s second multi-family deal
- 75-unit, deep value-add
- Unsafe building, occupancy low
- Capital raise with 11 investors
- $1.2M renovation
[15:46] Devin’s take on working your way up in multi-family
- Jump into 80-plus units
- 5-80 units is ‘no man’s land’
- Larger project allows for staffing
[16:59] Devin’s advice to his younger self
- Multi-family is way to go
- Hoard your money to get first deal done
- Second will follow in quick succession
[18:06] Devin’s current multi-family deal
- 192-unit in nicer area
- 8-10% cash-on-cash return
- Equity multiple of two over five years
[19:27] Devin’s advice to aspiring real estate investors
- Employ ‘borrowed credibility’
- Build team with experience, track record
- Act as quarterback, specialize in putting deal together
[22:47] Devin’s failures
- Lost own money on flip house, improved systems
- Counts not pursuing entrepreneurship sooner as failure
[24:00] How Devin overcame a lack of confidence
- ‘Someday is now’
- Quitting job as mental hurdle
[24:52] Devin’s AHA moment
- Desire to create life he enjoys every day
- Not working toward ‘someday’
[25:33] What Devin is excited about
- Making positive impact on community through multi-family
- Rewarding to give investors good return
- Rehab of property impacts neighborhood
Connect with Devin Elder
Resources
Free eBook: The Secret to Raising Money to Buy Your First Apartment Building
