“It’s these little things that we do every day that get us closer. I remember climbing a mountain in high school, and the guide told us, ‘Don’t look at the summit. Focus on putting one foot in front of the other, and the summit will take care of itself.’ That’s exactly how I treat business. As long as I know I’m on the right mountain—which I firmly believe is multifamily—I come in here every day and focus on putting one foot in front of the other.”
Ivan Barratt is the founder and CEO of Barratt Asset Management, a real estate investment and management company out of Indianapolis that specializes in the acquisition, redevelopment and management of multifamily apartment communities. Since forming the firm in 2010, Ivan has raised tens of millions in equity, acquired 2,700 units, and grown BAM to a best-in-class management company, boasting $100M in assets under management.
Ivan joins me to explain how he started small with a duplex and 6-unit property, financing deals with hard money loans. He discusses his gradual transition to larger deals, describing his approach to raising capital by building trust with potential investors in the business and medical communities. Ivan shares his ‘mortal sins of multifamily’ as well as the game changers that have allowed him to scale up to 2,700 units. Listen in for Ivan’s advice around doing little things every day to prepare for your career as a multifamily investor!
Key Takeaways
How Ivan got his start with a duplex
- Put down as little as possible
- Lived in one side, rented other
- ‘Journey of $10K units starts with first deal’
What Ivan would do differently given the opportunity
- Go straight to 20-, 30- or 40-unit deals
- Takes same effort to close small deal as large one
- Track record and momentum are most important
How Ivan got started with hard money loans
- Small multifamily opportunities in market
- Great lender put up cash for acquisition, renovation
Ivan’s early 6-unit deal
- Evaluated using simple flipper equation
- Bought for $150K, $100K in renovations
- Refi nine months in to put high-interest debt to rest
- Sold for $350K
How Ivan transitioned from hard money to raising capital
- Built large pipeline of contacts, ask for referrals
- Conversations with people in business and medicine
Ivan’s approach to building relationships with investors
- Get to know people through common interests
- Explain what you do and treat people well
- Deliver value, educate on what good deal looks like
- Network multiplies on its own over time
Ivan’s ‘mortal sins’ of multifamily
- Tried to renovate project out of cashflow
- Viewed property management co as profit center
Ivan’s AHA moment after the crash
- Rereading Rich Dad… reinforced cashflow as king
- Realized need to build model and scale
- Reduced risk for WHEN market changes, not IF
The game changers that have allowed Ivan to scale
- View property management arm as a necessary machine (not a profit center)
- Bring in a partner for sweat equity, combined forces greater than the sum of parts
Ivan’s advice for aspiring multifamily investors
- Get educated through podcasts
- Underwrite 100 deals on LoopNet
- Set networking goals (investors, brokers and team)
- Do little things every day to prepare
Why Ivan continues to grow and scale his business
- Driven by possibilities, freedom
Ivan’s perfect day on Gulf Shores
- Up before sun to workout
- Mission-critical emails/calls, check in with partner
- Day on beach or at pool with family
Connect with Ivan
Call (317) 762-2625
Resources
Rich Dad Poor Dad: What the Rich Teach Their Kids About Money—That the Poor and Middle Class Do Not! by Robert T. Kiyosaki
Michael’s Syndicated Deal Analyzer
Michael’s Deal Maker Mastermind
Financial Freedom Summit
Free eBook: The Secret to Raising Money to Buy Your First Apartment Building
