1 00:00:00,520 --> 00:00:03,280 All right, we'll get started. Welcome everyone to Buying 2 00:00:03,280 --> 00:00:05,080 Local. I'm your host, Mike Nelson from 3 00:00:05,080 --> 00:00:09,920 5 Towers Media, joined today by the founder of Green Springs 4 00:00:10,120 --> 00:00:13,000 Companies, Brian Greene. Brian, welcome. 5 00:00:14,120 --> 00:00:16,400 Thank you for having me, Mike. Glad to be here with you today. 6 00:00:16,760 --> 00:00:20,400 Absolutely appreciate the time. And we're also joined by Matthew 7 00:00:20,400 --> 00:00:23,520 know the five towers, as some of you know, if you listen to one 8 00:00:23,520 --> 00:00:26,240 of our last episodes, Matt's going to be working in here to 9 00:00:26,240 --> 00:00:29,320 do some more podcasting with us and eventually take over the 10 00:00:29,320 --> 00:00:31,480 show completely. So welcome, Matthew. 11 00:00:32,040 --> 00:00:35,080 Yes, thank you, Brian. And looking forward to our 12 00:00:35,080 --> 00:00:42,560 conversation here absolutely so often and kind of give us a 13 00:00:42,560 --> 00:00:44,360 little bit of a rundown about Green Spring. 14 00:00:45,320 --> 00:00:48,280 Yeah. So I like to say that we are a 15 00:00:48,400 --> 00:00:51,760 development company. So that's primarily what I focus 16 00:00:51,760 --> 00:00:55,280 on. But we're a real estate family 17 00:00:55,280 --> 00:00:56,800 of companies, right. So we do real estate 18 00:00:56,800 --> 00:00:58,480 development, investment services. 19 00:00:59,200 --> 00:01:01,120 We also own a property management company. 20 00:01:01,640 --> 00:01:04,480 We have offshoots that are in the commercial construction and 21 00:01:04,480 --> 00:01:06,440 real estate financial advisory fields as well. 22 00:01:07,240 --> 00:01:12,520 But our focus primarily and how we started was, you know, kind 23 00:01:12,520 --> 00:01:15,040 of just a real estate investment firm that was buying small, 24 00:01:15,040 --> 00:01:19,280 medium sized properties in and around I guess the Saratoga 25 00:01:19,280 --> 00:01:22,800 County area to start. Originally it was, you know, 26 00:01:22,800 --> 00:01:26,160 just me, you know, But then over time, the last eleven years or 27 00:01:26,160 --> 00:01:29,160 so, we've kind of grown it out to a whole family of companies 28 00:01:29,160 --> 00:01:32,320 with numerous employees and kind of different functionalities. 29 00:01:33,520 --> 00:01:36,280 But we are definitely local. We're have offices in downtown 30 00:01:36,280 --> 00:01:39,160 Saratoga. We got a lot of different 31 00:01:39,160 --> 00:01:42,240 projects going on and it's kind of hard to kind of keep my head 32 00:01:42,240 --> 00:01:44,720 on straight and focus on one of the companies versus all of 33 00:01:44,720 --> 00:01:46,440 them. But hopefully we'll kind of 34 00:01:46,440 --> 00:01:48,800 it'll make more sense here as we kind of go through the 35 00:01:48,800 --> 00:01:51,400 conversation here a little bit. Yeah, yeah. 36 00:01:51,440 --> 00:01:56,400 I, you know, one of the most fascinating things to me, Brian, 37 00:01:56,400 --> 00:02:02,520 about entrepreneurs and business owners is it always starts here 38 00:02:02,760 --> 00:02:05,680 and then grows into all these things, right? 39 00:02:05,680 --> 00:02:08,960 And it's, it really is one of my favorite things because it's, 40 00:02:09,160 --> 00:02:12,200 you know, needs arrive and pivots happen and markets 41 00:02:12,200 --> 00:02:14,640 change. I'd love to hear. 42 00:02:14,680 --> 00:02:17,920 So you started with the real estate investment firm, you 43 00:02:17,920 --> 00:02:21,280 said, and then it kind of grew and blossomed out from there. 44 00:02:21,480 --> 00:02:26,440 What what was like the the the catalyst for that growing and 45 00:02:26,440 --> 00:02:28,800 blossoming and creation of other companies? 46 00:02:29,320 --> 00:02:31,400 Yeah. I mean, Full disclosure, when we 47 00:02:31,400 --> 00:02:33,360 say it started as a real estate investment firm, that was 48 00:02:33,360 --> 00:02:37,160 literally me just buying properties on my own for my own 49 00:02:37,160 --> 00:02:39,160 investments, right. So that's, I guess you can call 50 00:02:39,160 --> 00:02:41,160 that a firm. But eventually it was, you know, 51 00:02:41,160 --> 00:02:44,600 it turned into that. You know, I, I think the impetus 52 00:02:44,800 --> 00:02:50,440 at some point for it turning into something bigger was maybe 53 00:02:50,440 --> 00:02:52,600 just out of necessity. And I got to the point where I 54 00:02:52,600 --> 00:02:56,880 had my first, I think, 5 or 6 buildings and I was managing, 55 00:02:56,880 --> 00:02:58,880 you know, I don't know, somewhere around 25 apartments. 56 00:02:59,320 --> 00:03:01,280 But I was literally doing everything myself, everything 57 00:03:01,280 --> 00:03:04,520 from like, you know, analyzing the property from a financial 58 00:03:04,520 --> 00:03:07,880 component to figuring out the financing to drawing out my own 59 00:03:07,880 --> 00:03:09,800 lease agreements. I was doing the lawn work. 60 00:03:09,800 --> 00:03:11,600 I was moving the snow in the winter. 61 00:03:11,600 --> 00:03:14,640 I was painting the units during the turnover, you know, just 62 00:03:14,640 --> 00:03:16,760 because that's like the traditional version of what you 63 00:03:16,760 --> 00:03:19,160 consider to be a landlord. And I was just getting, I was 64 00:03:19,160 --> 00:03:21,560 new to the business, right? So my previous career, I was in, 65 00:03:21,640 --> 00:03:24,040 you know, retail. I owned a chain of Verizon 66 00:03:24,040 --> 00:03:26,320 stores for, you know, 11 or 12 years. 67 00:03:26,840 --> 00:03:30,960 So that was what I knew and I came into real estate after the 68 00:03:30,960 --> 00:03:33,480 sale of that old company and I was kind of like just trying to 69 00:03:33,480 --> 00:03:36,000 figure it out. And I also had a lot of time on 70 00:03:36,000 --> 00:03:37,960 my hands because, you know, I had sold the old company and I 71 00:03:37,960 --> 00:03:39,520 didn't have that day today anymore. 72 00:03:39,920 --> 00:03:43,800 But at some point it became too much and it was obvious that 73 00:03:43,800 --> 00:03:46,320 there were certain parts of the business that I did not care for 74 00:03:46,680 --> 00:03:49,880 and I wasn't very good at. And, you know, so I started 75 00:03:49,880 --> 00:03:53,720 outsourcing that stuff 1st and then it just freed up my time to 76 00:03:53,720 --> 00:03:56,640 do more of the acquisitions work and more of the, you know, high 77 00:03:56,640 --> 00:03:58,720 level systems and operations type work. 78 00:04:00,360 --> 00:04:03,400 And, you know, I'm kind of the, the guy that kind of likes to 79 00:04:03,400 --> 00:04:05,280 keep evolving and keep progressing forward. 80 00:04:05,600 --> 00:04:08,600 So as I keep coming up with new goals and new aspirations, it 81 00:04:08,600 --> 00:04:10,080 turns into, oh, well, what if we did this? 82 00:04:10,080 --> 00:04:11,680 And what if we did that? And maybe we should buy this 83 00:04:11,680 --> 00:04:12,720 building. And then like, all right, well, 84 00:04:12,720 --> 00:04:14,560 what does that look like? Who do we need to run that? 85 00:04:14,960 --> 00:04:17,640 And it just, it iterates itself and it kind of turns into this, 86 00:04:17,640 --> 00:04:20,079 like you said, place where we are now. 87 00:04:20,079 --> 00:04:22,920 But that's when I first started. I just thought like, hey, we'll 88 00:04:22,920 --> 00:04:25,880 buy five or ten of these and it will be great, and then we'll 89 00:04:25,880 --> 00:04:28,160 just sit around and make cash flow and it turned into 90 00:04:28,160 --> 00:04:32,680 something way different. As you're saying it like I can, 91 00:04:33,000 --> 00:04:36,280 I can picture the idea, right? I sold my business. 92 00:04:36,640 --> 00:04:38,600 I need to do something with my time. 93 00:04:38,840 --> 00:04:40,720 Oh, just buy a couple of buildings, right? 94 00:04:40,720 --> 00:04:42,680 It'll be fine. And then all of a sudden, you 95 00:04:42,680 --> 00:04:45,600 know, 11 years later, you, you know, you've grown it into this 96 00:04:45,600 --> 00:04:49,040 thing, right? Like it's, it's you do well, you 97 00:04:49,040 --> 00:04:51,080 know what they say, right, If you're either growing or dying. 98 00:04:51,080 --> 00:04:54,760 So it's a, it kind of becomes a not even a choice at that point, 99 00:04:54,760 --> 00:04:55,960 right? You just got to keep moving. 100 00:04:56,400 --> 00:04:57,760 Yeah. Plus if you have that 101 00:04:57,960 --> 00:05:01,320 entrepreneurial drive in you and like you see that like even on a 102 00:05:01,320 --> 00:05:06,280 small scale that a business model works, if then you're 103 00:05:06,280 --> 00:05:09,520 like, OK, well what if it, what if I did this at a 10X higher 104 00:05:09,520 --> 00:05:11,640 level? Like the model still works, it's 105 00:05:11,640 --> 00:05:13,840 just bigger numbers and it's way higher returns for the same 106 00:05:13,840 --> 00:05:15,360 amount of work. So why wouldn't I do that, 107 00:05:15,680 --> 00:05:17,080 right? I'm always like, I'm very logic 108 00:05:17,080 --> 00:05:20,160 driven and very like if test case it out and figure out the 109 00:05:20,160 --> 00:05:22,480 model. But once it works, like throw 110 00:05:22,480 --> 00:05:25,720 gas on that thing because it, it definitely works, You know, as 111 00:05:25,720 --> 00:05:29,040 long as you can manage like the kind of the quality of lifetime 112 00:05:29,040 --> 00:05:31,680 constraint type stuff, which I think I'm pretty good at from, 113 00:05:31,800 --> 00:05:35,560 you know, outsourcing and hiring team members, you know, just, 114 00:05:35,560 --> 00:05:39,240 it's impossible for me to see something work and then not go 115 00:05:39,240 --> 00:05:40,000 with it. You know what I mean? 116 00:05:40,040 --> 00:05:42,720 Like it's, it's like, you know, it's impossible to like just let 117 00:05:42,720 --> 00:05:46,320 that thing walk by when you see and you know how to do it once 118 00:05:46,320 --> 00:05:50,640 you figure it out. It's, I'm curious, did you when 119 00:05:50,640 --> 00:05:53,800 you first started out you were doing mainly like residential, 120 00:05:53,800 --> 00:05:56,720 like maybe single family or multi units like 1 to 4 unit 121 00:05:56,720 --> 00:05:57,880 kind of stuff? Yeah. 122 00:05:58,240 --> 00:06:00,480 And because I heard you say that, you know, it, it kind of 123 00:06:00,480 --> 00:06:03,000 started off here, but it's like, well, I can do the same thing at 124 00:06:03,000 --> 00:06:06,560 a bigger level and 10X. So I I assume that means that in 125 00:06:06,560 --> 00:06:10,960 the beginning it was 1 to 4 units, and now you've moved into 126 00:06:11,280 --> 00:06:15,400 larger properties as well. Yeah, only yes, I mean, 127 00:06:15,400 --> 00:06:17,760 everyone, you know, at this point we've got team members and 128 00:06:17,760 --> 00:06:21,320 partners and they're always, you know, reiterating to me, you 129 00:06:21,320 --> 00:06:24,040 know, it's just as much work to do this 50 unit apartment 130 00:06:24,040 --> 00:06:26,080 building and as if you go buy a duplex. 131 00:06:26,080 --> 00:06:30,040 So like stop buying the duplex, you know, it's one of those 132 00:06:30,040 --> 00:06:31,960 deals, right, Because you're just giving us more work to do 133 00:06:31,960 --> 00:06:33,840 for less, you know, for the same return. 134 00:06:35,280 --> 00:06:39,200 So yeah, I mean, ideally it, it's scalable, right? 135 00:06:39,200 --> 00:06:41,240 So like, but it's the same process over and over. 136 00:06:41,240 --> 00:06:42,920 You're going to do the same process for getting something 137 00:06:42,920 --> 00:06:45,240 under contract and underwriting is the same and the due 138 00:06:45,240 --> 00:06:47,600 diligence process is the same. The financing is a little bit 139 00:06:47,600 --> 00:06:51,360 different, but mostly the same. You know, managing A tenant 140 00:06:51,840 --> 00:06:53,840 doesn't matter if there's 4 units in that building or 40, 141 00:06:53,840 --> 00:06:57,560 it's kind of the same thing. But the advantages to that 142 00:06:57,560 --> 00:07:00,800 management expertise or that, you know, underwriting expertise 143 00:07:00,800 --> 00:07:03,040 are all magnified when it's a bigger number, right? 144 00:07:03,200 --> 00:07:06,480 So like, you know, if you're going to make a 20% return, if 145 00:07:06,480 --> 00:07:08,520 you're doing that on 100 grand versus 10 million, it's a whole 146 00:07:08,520 --> 00:07:10,280 different ball game, right? But you're doing the same thing. 147 00:07:10,280 --> 00:07:13,440 It's the exact same work. As long as you can kind of 148 00:07:13,440 --> 00:07:15,960 manage and you know, mitigate and become comfortable with the 149 00:07:15,960 --> 00:07:19,040 the risk profile, I think it it just makes sense to go in that 150 00:07:19,040 --> 00:07:22,600 direction. Do you, do you still own any of 151 00:07:22,600 --> 00:07:25,240 the properties that you bought way back when with some of those 152 00:07:25,240 --> 00:07:28,160 first properties or are they all all evolved since? 153 00:07:28,160 --> 00:07:30,040 Then I've, I've sold some of them. 154 00:07:30,040 --> 00:07:33,480 Many of them though I still own because, you know, we can kind 155 00:07:33,480 --> 00:07:36,600 of get into it, but our model is like a heavy value add type of 156 00:07:36,600 --> 00:07:39,360 strategy where we're going in, we're doing, you know, major 157 00:07:39,360 --> 00:07:42,280 renovations in construction. So if we buy something, you 158 00:07:42,720 --> 00:07:46,160 know, very soon thereafter it's in very much like new condition. 159 00:07:47,080 --> 00:07:49,240 So once it's new, it kind of operates on its own. 160 00:07:49,240 --> 00:07:51,440 It's got very low, you know, repair and maintenance type of 161 00:07:51,440 --> 00:07:53,240 stuff. It it's kind of on autopilot and 162 00:07:53,240 --> 00:07:57,040 it just keeps appreciating. So at that point it makes a lot 163 00:07:57,040 --> 00:07:59,280 of sense for us to keep it. I mean, when we buy something 164 00:07:59,280 --> 00:08:01,080 we're always looking at like a 10 plus year hold. 165 00:08:02,480 --> 00:08:05,440 So I mean those buildings were all renovated in the new. 166 00:08:05,440 --> 00:08:07,440 So it's hard for me to kind of give them up unless I have an 167 00:08:07,440 --> 00:08:10,160 opportunity to sell them and roll it into something bigger, 168 00:08:11,080 --> 00:08:14,360 which we may get to. I do have, you know, it's been 169 00:08:14,360 --> 00:08:18,040 maybe 7 or 8 years for the, the many of the ones I still own, 170 00:08:18,280 --> 00:08:21,520 the first couple, we have a couple of those in downtown 171 00:08:21,520 --> 00:08:23,160 Saratoga that we're in the process of doing condo 172 00:08:23,160 --> 00:08:26,680 conversions on only because we've kind of exhausted the 173 00:08:26,680 --> 00:08:29,040 value of that property running it as an apartment building. 174 00:08:29,040 --> 00:08:31,800 But it's worth, you know, maybe 2 times more for if they're 175 00:08:31,800 --> 00:08:34,919 condos. So just on a small scale, maybe 176 00:08:34,919 --> 00:08:36,960 we'll, we'll exit those properties selling them off as 177 00:08:36,960 --> 00:08:38,960 condos instead. And so, you know, we, we kind of 178 00:08:38,960 --> 00:08:43,960 get creative with it, but we're, we're, we're a long term hold 179 00:08:43,960 --> 00:08:46,240 type people. So, you know, it takes a lot for 180 00:08:46,240 --> 00:08:47,880 us to move off of it. Yeah. 181 00:08:48,400 --> 00:08:51,360 I so, so many questions I have as you're as you're speaking, 182 00:08:51,360 --> 00:08:54,520 You know what on one side I want to ask about some of those 183 00:08:54,520 --> 00:08:57,800 pivots in response to market changes like you just mentioned 184 00:08:57,800 --> 00:09:00,960 of going from like a say a standard apartment to a condo. 185 00:09:01,320 --> 00:09:04,000 I also want to talk about the overall model that you have. 186 00:09:05,000 --> 00:09:08,640 But you also kind of mentioned, and I just want to touch on this 187 00:09:08,640 --> 00:09:12,320 real quick, the idea that, you know, whether you're doing a 188 00:09:12,320 --> 00:09:16,960 four unit or a 40 unit, it's relatively the same steps, 189 00:09:17,040 --> 00:09:18,840 right? The same work, just at a 190 00:09:18,840 --> 00:09:23,800 different scale, we'll say. I'm curious to know if you are a 191 00:09:23,800 --> 00:09:28,200 big process guy, like when you did you have processes in place 192 00:09:28,440 --> 00:09:31,800 for like the four units that you were able to kind of adapt for 193 00:09:31,800 --> 00:09:34,200 that larger model or for that larger unit? 194 00:09:34,720 --> 00:09:39,000 Yeah, I mean, at first sort of, I mean, I was kind of trying to, 195 00:09:39,000 --> 00:09:40,720 I was just kind of figuring it out on the fly. 196 00:09:42,520 --> 00:09:45,880 I do do a ton of reading and listening to podcasts and stuff. 197 00:09:45,880 --> 00:09:49,880 So, you know, at this point, I've definitely got my probably 198 00:09:49,880 --> 00:09:54,000 2X my 10,000 hours I need into this thing just through those 199 00:09:54,000 --> 00:09:58,440 type of mechanisms and on, on, you know, on the on the spot 200 00:09:58,440 --> 00:10:00,840 kind of delivery when I'm doing the doing these properties. 201 00:10:01,160 --> 00:10:03,400 But yeah, I mean, it it depending on what I'm doing, 202 00:10:03,600 --> 00:10:05,600 there is checklist, there is things like that. 203 00:10:06,840 --> 00:10:11,560 But I feel, I feel like I am I'm OK doing that. 204 00:10:11,560 --> 00:10:14,000 I don't like doing that. So like the other part of 205 00:10:14,000 --> 00:10:17,560 scaling is if you're scaling it to that 40 unit building instead 206 00:10:17,560 --> 00:10:20,960 of that four and the profit margin still that 20%, well, you 207 00:10:20,960 --> 00:10:23,320 can do the process and now you can afford to bring on team 208 00:10:23,320 --> 00:10:26,360 members that are better than you at certain aspects of the deal. 209 00:10:26,360 --> 00:10:29,680 Then then you are yourself and or you can outsource the stuff 210 00:10:29,680 --> 00:10:31,240 that you don't like to do or you're not good at. 211 00:10:32,040 --> 00:10:34,040 Whereas if you're doing the four unit and you're still making 212 00:10:34,040 --> 00:10:37,840 20%, that sounds great, but you don't have enough total revenue 213 00:10:37,840 --> 00:10:40,400 there to have those team members on board. 214 00:10:40,400 --> 00:10:42,760 You got to do it all yourself. So that's the other advantage I 215 00:10:42,760 --> 00:10:45,080 found to to scaling is then you can bring on partners and you 216 00:10:45,080 --> 00:10:47,880 can bring on high level team members and you can kind of just 217 00:10:47,880 --> 00:10:50,960 niche into the stuff that is really good, you know, and and 218 00:10:50,960 --> 00:10:53,000 your real value is kind of shown. 219 00:10:53,880 --> 00:10:55,080 Interesting. Yeah. 220 00:10:55,080 --> 00:11:00,320 And, and again, I, I, you know, I think you and I may have 221 00:11:00,320 --> 00:11:02,880 talked about this and other conversations that we've had 222 00:11:03,680 --> 00:11:08,720 over the last few months, but I, I, for six years, I had a 223 00:11:08,720 --> 00:11:11,480 property management company. And like, so when you were 224 00:11:11,480 --> 00:11:14,040 talking about kind of your early days, right, of you're doing 225 00:11:14,040 --> 00:11:16,040 the, you know, doing the painting, doing the renting, 226 00:11:16,040 --> 00:11:20,280 doing the lawn, I was in that for like 6 years and I remember 227 00:11:20,280 --> 00:11:23,880 it very well. And you know, I unfortunately 228 00:11:23,880 --> 00:11:26,760 was not able to, well, I ended up selling the business itself, 229 00:11:26,760 --> 00:11:30,480 but and got out entirely, but I certainly was not able to 230 00:11:30,480 --> 00:11:32,640 accomplish what you have been able to accomplish. 231 00:11:32,640 --> 00:11:34,880 And so it, it just makes me really curious about the whole 232 00:11:34,880 --> 00:11:36,160 model and everything that you're doing. 233 00:11:36,160 --> 00:11:40,760 You know, so and maybe that's a good Segway for us to talk about 234 00:11:40,760 --> 00:11:43,640 your model and to kind of tell us a little bit more about how 235 00:11:43,640 --> 00:11:46,680 you operate and who you work with and kind of how all that 236 00:11:46,880 --> 00:11:48,640 functions together. Yeah. 237 00:11:48,640 --> 00:11:51,240 So now, you know, we've been doing this. 238 00:11:51,240 --> 00:11:56,240 We're in year 11 or 12 here. So now we have 4 companies, 4 239 00:11:56,240 --> 00:11:59,280 main entities. One is Green Springs Capital 240 00:11:59,280 --> 00:12:02,560 Group, which focuses on real estate development and also 241 00:12:03,200 --> 00:12:05,920 works with a lot of our, we, we bring on. 242 00:12:06,520 --> 00:12:08,200 It's kind of a bigger conversation, but we bring on 243 00:12:08,200 --> 00:12:11,400 now private investors for a lot of our projects, the bigger 244 00:12:11,400 --> 00:12:14,560 stuff we're doing now. So Green Springs Capital is the 245 00:12:14,560 --> 00:12:17,880 one that manages those that investment portfolio and works 246 00:12:17,880 --> 00:12:20,640 with those individuals that are basically the money side of a 247 00:12:20,640 --> 00:12:24,040 lot of our projects as well as going out and sourcing deals, 248 00:12:24,400 --> 00:12:27,360 underwriting and kind of putting the whole thing together through 249 00:12:27,360 --> 00:12:29,400 municipal approvals and financing and what have you. 250 00:12:29,920 --> 00:12:33,320 So that's the kind of the the top company. 251 00:12:33,320 --> 00:12:37,040 And then we have Greensprings Property Management, which is to 252 00:12:37,040 --> 00:12:39,000 be honest, probably the most important one because that's 253 00:12:39,000 --> 00:12:40,840 managing the operations of the properties. 254 00:12:41,640 --> 00:12:43,160 You know, I can have the greatest business plan from a 255 00:12:43,160 --> 00:12:46,280 developer's perspective all day long, but if the actual property 256 00:12:46,280 --> 00:12:49,840 is not managed, you know, for optimization and according to 257 00:12:49,840 --> 00:12:51,560 that business plan, the whole thing kind of falls on its face. 258 00:12:51,560 --> 00:12:56,520 So the management company, which I still run today is also 259 00:12:56,520 --> 00:12:59,600 extremely important and they primarily only manage for 260 00:12:59,600 --> 00:13:01,720 ourselves. So they're managing only Green 261 00:13:01,720 --> 00:13:03,680 Springs Capital properties for the most part. 262 00:13:04,280 --> 00:13:08,080 We are kind of tipping our toes in the water a little bit to do 263 00:13:08,240 --> 00:13:12,480 some outside property management for 3rd party companies, mostly 264 00:13:12,480 --> 00:13:14,680 focused on like the maintenance side of things versus the 265 00:13:14,680 --> 00:13:18,000 leasing, but that's kind of a, a new thing for us. 266 00:13:18,000 --> 00:13:19,760 So primarily though they're managing in house. 267 00:13:19,880 --> 00:13:21,800 And then we also have a commercial construction company. 268 00:13:22,440 --> 00:13:26,400 So forever we did construction internally and my partners, one 269 00:13:26,400 --> 00:13:29,720 of my partners is my brother and he was running that construction 270 00:13:29,720 --> 00:13:33,120 team internally with some other team members within Green 271 00:13:33,120 --> 00:13:36,200 Springs Capital Group before. And then two years ago we spun 272 00:13:36,200 --> 00:13:38,960 it off into it's called CG Construction Group. 273 00:13:39,680 --> 00:13:42,040 We brought on another partner which had some, you know, 274 00:13:42,280 --> 00:13:44,120 tremendous experience in construction. 275 00:13:44,120 --> 00:13:47,360 His name is Matt Crudo. So now the two of them lead the 276 00:13:47,360 --> 00:13:49,480 commercial construction company and they're doing all of Green 277 00:13:49,480 --> 00:13:53,160 Springs construction projects like on new developments as 278 00:13:53,160 --> 00:13:55,600 they're and they're also doing third party construction. 279 00:13:55,600 --> 00:13:57,920 So you know, right now they're doing the big project is they're 280 00:13:57,920 --> 00:13:59,920 building the extension on Glens Falls hospital. 281 00:14:00,840 --> 00:14:02,920 You know, they built the new, they built new the new Ted's 282 00:14:02,920 --> 00:14:04,800 fish fry on Route 50. So they're doing a bunch of 283 00:14:04,800 --> 00:14:07,760 other stuff other than Green Springs capital, but their 284 00:14:07,760 --> 00:14:11,800 capacity is unlimited, right. So now it kind of gives us at 285 00:14:11,800 --> 00:14:15,320 Green Springs when I'm looking at projects, no longer do I have 286 00:14:15,320 --> 00:14:17,760 to say like, oh, this probably makes some financial sense, but 287 00:14:17,760 --> 00:14:19,160 I don't know if we can execute, right? 288 00:14:19,160 --> 00:14:20,920 So now I know that from a construction perspective, 289 00:14:20,920 --> 00:14:23,440 there's no limitation. And then the 4th company we have 290 00:14:23,440 --> 00:14:26,920 is a real estate financial advisory firm specific to real 291 00:14:26,920 --> 00:14:31,440 estate developers and investors. And they also serve as like a 292 00:14:31,440 --> 00:14:33,720 commercial mortgage brokerage for those people. 293 00:14:33,720 --> 00:14:36,040 But mostly what they're doing is they're giving like asset 294 00:14:36,040 --> 00:14:38,200 management advice. So they're reviewing their 295 00:14:38,200 --> 00:14:40,080 portfolio. They're kind of looking for ways 296 00:14:40,080 --> 00:14:43,080 to optimize it, looking for strategic ways to change around 297 00:14:43,080 --> 00:14:45,520 the financing to increase their cash flow, if that's what 298 00:14:45,520 --> 00:14:48,240 they're looking for. They do some consulting work, a 299 00:14:48,240 --> 00:14:50,560 lot of it actually on the construction consulting. 300 00:14:50,560 --> 00:14:55,000 So like helping people that know how to build also put together 301 00:14:55,000 --> 00:14:56,920 the financial performer behind that construction. 302 00:14:56,920 --> 00:14:58,920 So it still makes sense from a project perspective. 303 00:14:58,920 --> 00:15:00,760 There's a lot of builders that know how to build, but they 304 00:15:00,760 --> 00:15:02,560 don't know how to do, they don't know how to math it. 305 00:15:03,160 --> 00:15:05,480 So like, you know what I mean? So like we're doing the math for 306 00:15:05,480 --> 00:15:07,960 them to make sure that like this is a solid project, this doesn't 307 00:15:07,960 --> 00:15:09,280 make sense, go ahead and build it. 308 00:15:09,280 --> 00:15:13,000 And this is the financing path. So it's kind of a unique 309 00:15:13,080 --> 00:15:16,760 business in the market. It's kind of a niche, but it's, 310 00:15:17,400 --> 00:15:19,640 it's, it's extremely valuable company. 311 00:15:19,640 --> 00:15:21,640 It's actually probably our most profitable at this point. 312 00:15:22,840 --> 00:15:24,640 So we have those four companies and they're all kind of 313 00:15:24,640 --> 00:15:28,480 servicing our projects and they all have their own leaders and 314 00:15:28,480 --> 00:15:31,680 their own skill sets. And that partnership kind of 315 00:15:31,680 --> 00:15:34,160 overlaps between a lot of those companies with shared ownership. 316 00:15:34,520 --> 00:15:37,600 So we kind of created like our own vertically integrated 317 00:15:37,680 --> 00:15:41,280 ecosystem, just with different entities instead of having 318 00:15:41,280 --> 00:15:44,200 everything under one umbrella. Interesting. 319 00:15:46,600 --> 00:15:48,560 So I'm curious. Well, again, I have a bunch of 320 00:15:48,560 --> 00:15:52,000 questions and and Matt, if you got it, you'll Matt, you'll find 321 00:15:52,000 --> 00:15:55,880 out and Derek Foster, that's my Co host on blue collar startup 322 00:15:56,160 --> 00:15:58,640 could tell you too. Like I always have 1000 323 00:15:58,640 --> 00:16:00,240 questions. So if you got something you 324 00:16:00,240 --> 00:16:02,160 could just got to jump in. You got to be you got to like 325 00:16:02,400 --> 00:16:04,720 don't even raise your hand. Just be like Mike, stop talking. 326 00:16:04,720 --> 00:16:09,400 I have a question, but my other question or one of the other 327 00:16:09,400 --> 00:16:13,360 questions anyway is you're talking about like with the 328 00:16:13,360 --> 00:16:17,280 construction company and with the property management company. 329 00:16:17,280 --> 00:16:21,320 And initially you're only handling internal stuff, which 330 00:16:21,640 --> 00:16:24,120 obviously makes sense, right? Because if it's your company, 331 00:16:24,120 --> 00:16:26,760 you're going to be able to, it's going to be less of a liability 332 00:16:26,760 --> 00:16:29,400 for you than if you were going out to a third party. 333 00:16:31,080 --> 00:16:33,440 However, it still is a liability though, right. 334 00:16:33,440 --> 00:16:36,720 So you talked about kind of expanding and going out and and 335 00:16:36,720 --> 00:16:39,480 taking on other clients for those two businesses. 336 00:16:39,480 --> 00:16:44,120 Is that part of a plan to turn that liability into an asset, so 337 00:16:44,120 --> 00:16:46,480 to speak, or is is there other things behind? 338 00:16:46,480 --> 00:16:51,880 It some of it is, well, there's a couple different angles to 339 00:16:51,880 --> 00:16:55,360 that. One of it is in order for me to 340 00:16:55,360 --> 00:16:59,160 get the high level partners that I want, they have to be owners 341 00:17:00,240 --> 00:17:06,200 and they so bringing on or creating those companies right 342 00:17:07,640 --> 00:17:13,800 and putting them in an ownership position is one of the ways to 343 00:17:13,800 --> 00:17:16,200 do that because otherwise these people would not be somebody 344 00:17:16,200 --> 00:17:18,160 that's just going to come work for you, right? 345 00:17:18,319 --> 00:17:20,240 Like, you know, so they need an ownership stake. 346 00:17:20,240 --> 00:17:24,800 One way to do that is to create an its own entity where we're Co 347 00:17:24,800 --> 00:17:26,319 owners. But like, so you're getting in 348 00:17:26,319 --> 00:17:29,720 the upside as well as, you know, kind of the the cash flow and 349 00:17:29,720 --> 00:17:32,560 the kind of the ongoing rewards for this business, right? 350 00:17:32,560 --> 00:17:35,160 So everyone's an owner versus you have, you know, that's a 351 00:17:35,160 --> 00:17:37,440 different situation than if you have an owner and employee, 352 00:17:37,600 --> 00:17:38,720 right? Just it just is. 353 00:17:39,520 --> 00:17:43,880 So that's one reason for it. The other reason is if any of 354 00:17:43,880 --> 00:17:47,120 your listeners know anything about real estate, it's not a 355 00:17:47,120 --> 00:17:52,120 cash rich business, it's a asset rich business. 356 00:17:52,160 --> 00:17:53,800 Like, you know, so like your balance sheet will keep 357 00:17:53,800 --> 00:17:57,760 increasing, but you are perpetually cash poor. 358 00:17:58,800 --> 00:18:02,400 So one way that my brother and I, who who were the first two 359 00:18:02,400 --> 00:18:07,920 partners tried to kind of leverage that was we basically 360 00:18:07,920 --> 00:18:11,560 traded asset value for cash businesses, right. 361 00:18:11,560 --> 00:18:14,040 So like in those partnership agreements, we basically came 362 00:18:14,040 --> 00:18:17,120 into it and said, all right, well, you know what, we'll be 363 00:18:17,120 --> 00:18:20,120 willing to give up, you know, a share of our portfolio right now 364 00:18:20,120 --> 00:18:22,080 and into the future. And then in exchange, you know, 365 00:18:22,080 --> 00:18:24,920 we'll, we'll help you set up these new companies and you 366 00:18:24,920 --> 00:18:27,320 know, your companies will be service businesses that generate 367 00:18:27,320 --> 00:18:31,120 a lot of cash and our company will, you know, generate, you 368 00:18:31,120 --> 00:18:33,640 know, equity and appreciation in these assets, right? 369 00:18:34,000 --> 00:18:36,320 So all of our balance sheets go up and all of our, you know, 370 00:18:36,320 --> 00:18:38,520 cash positions are going up simultaneously. 371 00:18:38,880 --> 00:18:41,520 But it was a basically without those service businesses, it's a 372 00:18:41,520 --> 00:18:45,920 very difficult business to keep doing because you're really not 373 00:18:45,960 --> 00:18:48,080 making much day-to-day cash flow. 374 00:18:48,600 --> 00:18:51,000 So that was kind of a strategic move on our part. 375 00:18:52,360 --> 00:18:54,320 So it, it worked in all three respects, right? 376 00:18:54,760 --> 00:18:57,400 Cash flow increased, got high level partners that came on 377 00:18:57,400 --> 00:19:00,840 board and now we also have the internal skill set and capacity 378 00:19:00,840 --> 00:19:04,840 with these high level people that you know they can execute 379 00:19:04,840 --> 00:19:08,160 on any financing we need, any financial analysis we need, any 380 00:19:08,160 --> 00:19:09,680 construction project we need. So like it. 381 00:19:09,760 --> 00:19:15,520 It worked for everyone involved. Yeah, it's it, it, it sounds 382 00:19:15,520 --> 00:19:19,040 like an amazing strategy to be, to be fair, like, you know, not 383 00:19:19,040 --> 00:19:22,640 to blow smoke or anything, but it's like it really, to your 384 00:19:22,640 --> 00:19:25,200 point, you got to keep feeding that machine on the real estate 385 00:19:25,200 --> 00:19:27,240 side, right? And you need a way to do that 386 00:19:27,240 --> 00:19:30,040 because it's, it's like, I don't know, it makes me think of like 387 00:19:30,400 --> 00:19:33,600 dividend mutual funds, right? Like you buy a bunch of mutual 388 00:19:33,600 --> 00:19:36,040 funds and the, the, yeah, the value keeps going up. 389 00:19:36,040 --> 00:19:38,320 And so on paper, you look like you're, you know, you're doing 390 00:19:38,480 --> 00:19:42,280 really well, but that little dividend that comes back each, 391 00:19:42,320 --> 00:19:45,000 you know, month or quarter or whatever really isn't enough to, 392 00:19:45,240 --> 00:19:48,000 you know, eat off of unless you've got a big portfolio. 393 00:19:48,000 --> 00:19:51,600 So it's, it's an interesting way to, to solve that problem. 394 00:19:53,640 --> 00:19:58,320 And you know, and this kind of goes back to responding to 395 00:19:58,320 --> 00:20:00,800 market conditions. It sounds like you guys are very 396 00:20:00,800 --> 00:20:06,240 good at responding to market conditions and figuring out 397 00:20:06,520 --> 00:20:10,440 either the service edition you need or the pivot you need to 398 00:20:10,440 --> 00:20:15,440 make in response to that. I'm, I'm curious of how you, do 399 00:20:16,160 --> 00:20:18,240 you have a crystal ball? Do you got a? 400 00:20:19,840 --> 00:20:23,880 Using ChatGPT. Some of it is just born of 401 00:20:23,880 --> 00:20:27,040 necessity, right? I mean, so when we're planning 402 00:20:27,040 --> 00:20:29,880 out the trajectory of the business over the next three to 403 00:20:29,880 --> 00:20:33,360 five years and we have, you know, these fairly aggressive 404 00:20:33,360 --> 00:20:37,600 goals, you know, if we get into a situation where the market is 405 00:20:37,640 --> 00:20:40,120 difficult, right, or it's hard, I'll give you an example. 406 00:20:40,120 --> 00:20:45,880 So like 2022-2023 prices were extremely high coming out of 407 00:20:46,000 --> 00:20:52,760 COVID on commercial real estate, but owners, but valuations, real 408 00:20:52,760 --> 00:20:56,280 valuations probably were 10 to 20% less than what everyone 409 00:20:56,280 --> 00:20:57,840 thought their properties were worth, right? 410 00:20:58,120 --> 00:21:01,480 So you had this disconnect between owners and buyers like 411 00:21:01,480 --> 00:21:03,440 in the marketplace. So nothing was moving, right? 412 00:21:03,800 --> 00:21:05,040 They didn't want to lower their price. 413 00:21:05,080 --> 00:21:07,640 I knew it wasn't worth what they thought it used to be worth, 414 00:21:07,640 --> 00:21:09,400 right? So like they were slow to like 415 00:21:09,400 --> 00:21:12,000 take the haircut that they, the market was demanding, right? 416 00:21:12,000 --> 00:21:15,560 So nothing was trading. So like if that happens and 417 00:21:15,760 --> 00:21:18,760 nothing's for for sale or you can't buy anything at the right 418 00:21:18,760 --> 00:21:21,760 price, what do you do Right, 'cause like you still have these 419 00:21:21,760 --> 00:21:23,720 growth targets, you just sit on your hands for two years and do 420 00:21:23,720 --> 00:21:26,600 nothing. So like our solution to that was 421 00:21:26,600 --> 00:21:29,040 like, all right, well, something must make sense right now. 422 00:21:29,040 --> 00:21:30,560 What makes sense right now and what do we do? 423 00:21:30,640 --> 00:21:33,840 So like the, for us, the thing that made sense was pivoting 424 00:21:33,840 --> 00:21:36,680 into historic properties, right, 'cause historic properties have 425 00:21:36,680 --> 00:21:39,840 government incentives, they have historic tax credits, they have 426 00:21:39,840 --> 00:21:42,800 all these other financial instruments that make them more 427 00:21:42,800 --> 00:21:47,400 attractive, even if the pricing might not be perfect, right? 428 00:21:47,400 --> 00:21:50,280 So I think the last five projects we did were all 429 00:21:50,280 --> 00:21:53,880 historic renovations to varying degrees, whether it was a 10 430 00:21:53,880 --> 00:21:56,120 unit building here or there's, you know, we just started doing 431 00:21:56,120 --> 00:21:57,800 a new one up in Glens Falls, that's 20 unit. 432 00:21:58,240 --> 00:21:59,480 Both of those are historic though. 433 00:21:59,480 --> 00:22:03,040 And you know, the tax credit element and figuring out that 434 00:22:03,120 --> 00:22:06,360 how that works and how we can return those to ourselves and to 435 00:22:06,360 --> 00:22:10,080 investors to make it pay off was just kind of the pivot we 436 00:22:10,080 --> 00:22:11,400 needed. And it allowed us to keep 437 00:22:11,400 --> 00:22:14,560 expanding even though nothing was really transacting. 438 00:22:15,080 --> 00:22:18,360 Yeah, Yeah. How does one go about learning 439 00:22:18,360 --> 00:22:20,760 all this stuff? I mean, this sounds very 440 00:22:20,760 --> 00:22:24,960 sophisticated and you know, you, you're like you'd said your 441 00:22:24,960 --> 00:22:28,960 background of, I mean, does any of running those Verizon stores 442 00:22:28,960 --> 00:22:32,200 translate to what you do now? Or is this something that you 443 00:22:32,200 --> 00:22:35,320 just kind of figured out along the way over the last 11 years? 444 00:22:35,840 --> 00:22:38,600 I think it's just that it's not like an expertise, it's just 445 00:22:38,600 --> 00:22:40,520 like having the capacity to figure stuff out. 446 00:22:40,800 --> 00:22:44,160 Like I know this makes sense. There's got to be somebody else 447 00:22:44,160 --> 00:22:45,920 that's doing this. How do I get a hold of them? 448 00:22:45,920 --> 00:22:48,160 How do I, you know, how do I have coffee with them? 449 00:22:48,160 --> 00:22:50,880 How do I pay a consultant to help me with this? 450 00:22:51,320 --> 00:22:53,480 How do I, you know, who knows how to do this right? 451 00:22:53,480 --> 00:22:56,000 And you just kind of say, keep asking a bunch of questions, 452 00:22:56,000 --> 00:22:57,520 kind of figuring out, talk to the right people. 453 00:22:57,520 --> 00:22:59,360 And then you can kind of put it all together and say, like, all 454 00:22:59,360 --> 00:23:01,600 right, this makes sense, let's do it. 455 00:23:03,120 --> 00:23:04,920 I think it's just kind of that like that it's an entrepreneur 456 00:23:04,920 --> 00:23:05,960 thing. It's like you got to have the 457 00:23:05,960 --> 00:23:09,200 persistence. You got to like never stop when 458 00:23:09,200 --> 00:23:11,520 you hit like a, you know, the blockade or somebody tells you, 459 00:23:11,520 --> 00:23:13,960 no, you kind of have to, there's always a way to figure it out, 460 00:23:14,040 --> 00:23:17,320 like just keep pushing forward, be persistent, figure the thing 461 00:23:17,320 --> 00:23:20,520 out. And then in the end, you know, 462 00:23:20,520 --> 00:23:23,480 you got to have the the confidence, I guess, of your own 463 00:23:23,480 --> 00:23:26,040 convictions to say, like, all right, I know enough now to do 464 00:23:26,040 --> 00:23:27,600 it. I don't know everything, but 465 00:23:27,600 --> 00:23:29,640 like, I know enough and I have the right people on my team. 466 00:23:29,640 --> 00:23:33,120 So let's go, let's go do this. And I think that's just, you 467 00:23:33,120 --> 00:23:35,120 know, any successful entrepreneur has to have that 468 00:23:35,120 --> 00:23:37,760 trait. You know, it's interesting that 469 00:23:37,760 --> 00:23:40,360 you say that 'cause I was just in a conversation this morning 470 00:23:40,600 --> 00:23:43,400 with Bill Tansy from the Op X shop and we were having that 471 00:23:43,400 --> 00:23:48,920 conversation of the difference between an entrepreneur whose 472 00:23:48,920 --> 00:23:52,680 job basically becomes problem solving all the time, right? 473 00:23:52,800 --> 00:23:55,280 Like that's what your job is. Doesn't matter what the industry 474 00:23:55,280 --> 00:23:57,960 is. It's you can be and and then 475 00:23:57,960 --> 00:24:00,280 there's the people that don't want to have anything to do with 476 00:24:00,280 --> 00:24:01,760 that and they just want to do the stuff. 477 00:24:02,000 --> 00:24:03,840 They just want to do the thing right. 478 00:24:04,240 --> 00:24:08,200 And what a part of that conversation was that you really 479 00:24:08,200 --> 00:24:13,560 have to enjoy overcoming the obstacle when it's put in front 480 00:24:13,560 --> 00:24:15,160 of you. What would you say that's fair? 481 00:24:17,240 --> 00:24:18,840 Generically, yeah. I mean, there's certain things 482 00:24:19,040 --> 00:24:20,840 that I'd rather not, I'd rather not tackle. 483 00:24:20,840 --> 00:24:24,840 But the yeah, I think that you have to, I think taking it a 484 00:24:24,840 --> 00:24:27,600 step higher than that, you have to, you have to enjoy being the 485 00:24:27,600 --> 00:24:30,120 person responsible for solving the problem, right. 486 00:24:30,120 --> 00:24:32,520 You might not like the problem and a lot of times they're 487 00:24:32,520 --> 00:24:36,200 annoying or it's kind of a distraction, but you have to 488 00:24:36,320 --> 00:24:42,840 enjoy having the responsibility and expertise in some level and 489 00:24:42,840 --> 00:24:48,360 the risk taking kind of, it's not like it's when I, when you 490 00:24:48,360 --> 00:24:50,640 say risk people like always, you know, it's like gambling and all 491 00:24:50,640 --> 00:24:51,840 this stuff. It's not that it's like 492 00:24:51,840 --> 00:24:54,400 calculated risk, right? You got to be comfortable in 493 00:24:54,400 --> 00:24:58,720 that position. And most people aren't, which is 494 00:24:58,720 --> 00:25:00,880 why most people don't open their own businesses or become 495 00:25:00,880 --> 00:25:02,880 successful in doing that, which is fine. 496 00:25:02,880 --> 00:25:05,440 It takes a certain personality profile, I think to do that. 497 00:25:05,840 --> 00:25:10,440 But yeah, it's, you know, when, when everyone else can't figure 498 00:25:10,440 --> 00:25:11,480 out the problem, guess where it goes? 499 00:25:11,480 --> 00:25:13,560 It goes right up to you and then you have to solve it. 500 00:25:14,240 --> 00:25:16,960 And like you don't solve it. Like you know what people don't 501 00:25:16,960 --> 00:25:19,560 get paid or you don't get, You don't make any money or you know 502 00:25:19,560 --> 00:25:21,160 the whole thing. You don't pay customers 503 00:25:21,520 --> 00:25:23,160 invoices. Like you have no choice but to 504 00:25:23,160 --> 00:25:25,880 figure it out, and like you have to be able to to embrace that at 505 00:25:25,880 --> 00:25:30,280 some level. Yeah, and I'm sure in a little 506 00:25:30,280 --> 00:25:32,120 bit of enjoyment, maybe literally. 507 00:25:32,600 --> 00:25:35,920 In the payoff when you saw it. In the payoff, yeah, that's, and 508 00:25:35,920 --> 00:25:39,240 that's the thing, right, Is it's not sometimes like like you 509 00:25:39,240 --> 00:25:42,480 said, sometimes the problems are annoying or just, you know, like 510 00:25:42,480 --> 00:25:45,480 awful and stressful. But when you get to overcome 511 00:25:45,480 --> 00:25:47,440 them, it's like that hard fought one, right? 512 00:25:47,440 --> 00:25:52,480 Like when the win is over a really good opponent, it's very, 513 00:25:52,640 --> 00:25:55,680 very sweet, right? And when it's an easy win, it's 514 00:25:55,680 --> 00:25:57,400 kind of like, yeah, whatever, big deal, but. 515 00:25:58,160 --> 00:26:01,720 And it's, you know, in a former life, I played football in 516 00:26:01,720 --> 00:26:03,320 college and that that's a different opponent. 517 00:26:03,320 --> 00:26:06,600 This opponent now is mostly like, you know, zoning boards 518 00:26:06,600 --> 00:26:10,440 and bankers. Yeah. 519 00:26:10,960 --> 00:26:12,560 Yeah. So it's a it's a different, it's 520 00:26:12,560 --> 00:26:16,760 a different playing field. But I guess it's where my 521 00:26:16,760 --> 00:26:19,480 competitive kind of inclinations have lied. 522 00:26:20,120 --> 00:26:24,960 Yeah, I'm curious about, but earlier in the conversation you 523 00:26:24,960 --> 00:26:29,760 talked about turning the apartments into condos and that 524 00:26:29,760 --> 00:26:34,080 in response to market conditions and and what is going to be a 525 00:26:34,080 --> 00:26:40,040 better decision for you now? The obviously the real estate 526 00:26:40,040 --> 00:26:44,440 market is just such a weird thing always and the last five 527 00:26:44,440 --> 00:26:47,880 or six years have been, you know, very interesting to see 528 00:26:47,880 --> 00:26:51,200 and be in. What do you see happening right 529 00:26:51,200 --> 00:26:53,960 now or what's going on right now with the real estate market that 530 00:26:54,200 --> 00:26:57,800 is of note? Well, there's not enough supply. 531 00:26:58,920 --> 00:27:01,400 So that's the problem. We're not building enough 532 00:27:01,400 --> 00:27:04,440 houses. A lot of that has to do with 533 00:27:04,600 --> 00:27:07,240 high financing costs over the last several years. 534 00:27:07,560 --> 00:27:14,520 A lot of it has to do to what should we say over complicated 535 00:27:14,520 --> 00:27:18,920 zoning at the municipal level and approval processes, which is 536 00:27:18,920 --> 00:27:21,920 the main culprit which everyone seems to ignore. 537 00:27:22,480 --> 00:27:25,600 But no matter what the the reason is or what you want to 538 00:27:25,600 --> 00:27:27,640 blame the reason on, there's not enough supply, right? 539 00:27:27,640 --> 00:27:30,360 So prices keep going up. It's not affordable for people 540 00:27:30,360 --> 00:27:33,760 to buy entry level homes at this point anymore, if there is even 541 00:27:33,760 --> 00:27:35,000 a such thing as an entry level home. 542 00:27:35,000 --> 00:27:37,760 I think I saw that the average age now for the first time home 543 00:27:37,760 --> 00:27:41,920 buyers, 38 years old, which is in the early 90s, it was like 544 00:27:41,920 --> 00:27:44,600 26. So like in the last 25 years, 545 00:27:44,600 --> 00:27:47,040 we've managed to mess this thing up severely. 546 00:27:48,560 --> 00:27:52,400 So for me as a person that owns housing, right, and is in the 547 00:27:52,400 --> 00:27:57,240 housing business, you know, if I'm looking at an apartment 548 00:27:57,240 --> 00:28:00,280 building, I can only charge so much in rent for those units, 549 00:28:00,320 --> 00:28:01,800 right? And if whatever I charge on 550 00:28:01,800 --> 00:28:03,960 those, there's a direct correlation between what then 551 00:28:03,960 --> 00:28:07,360 the value of the building is. So knowing though that 552 00:28:07,360 --> 00:28:11,040 condominiums, right, might suit an entry level homebuyer if 553 00:28:11,040 --> 00:28:13,320 they're priced correctly. You know, if you have a three or 554 00:28:13,320 --> 00:28:17,080 four unit building and it might be worth 8 or $900,000 as an 555 00:28:17,080 --> 00:28:20,040 apartment building. If you turn them into condos, 556 00:28:20,040 --> 00:28:23,960 you can sell each one for 404 hundred 5500 thousand, which is 557 00:28:23,960 --> 00:28:26,040 still below the median here in Saratoga. 558 00:28:27,400 --> 00:28:31,200 Then your property might be worth 1.31 point 4 million just 559 00:28:31,200 --> 00:28:33,840 by converting them and selling them off, you know, to 560 00:28:33,840 --> 00:28:35,280 homebuyers instead of to renters. 561 00:28:35,840 --> 00:28:40,920 So you know that it's a good it's a better exit plan at this 562 00:28:40,920 --> 00:28:42,520 time in the market. There's other times where 563 00:28:42,520 --> 00:28:45,000 there's plenty of housing, right, and hasn't been recently, 564 00:28:45,000 --> 00:28:46,960 but there there might be other times where there's plenty of 565 00:28:46,960 --> 00:28:50,400 housing and the demand for condos might be really weak or 566 00:28:50,400 --> 00:28:53,440 that model might not work in a different admissive ality like 567 00:28:53,480 --> 00:28:55,840 you couldn't. You probably can't go to Glens 568 00:28:55,840 --> 00:28:58,840 Falls 20 minutes off the road and try that same thing because 569 00:28:58,840 --> 00:29:02,360 condos don't have the same demand and the houses are less 570 00:29:02,360 --> 00:29:04,720 are more affordable, right? So like you can't do the same 571 00:29:04,720 --> 00:29:06,400 thing there. But if you're in downtown 572 00:29:06,400 --> 00:29:09,640 Saratoga where there is no housing and it's very expensive, 573 00:29:09,680 --> 00:29:12,880 then that strategy might work. So it's very real estate is very 574 00:29:12,880 --> 00:29:16,120 local, like zip code to zip code differences, right? 575 00:29:16,120 --> 00:29:19,320 So that's kind of why we came up with that strategy on those 576 00:29:19,320 --> 00:29:21,160 couple small buildings. Yeah. 577 00:29:22,480 --> 00:29:23,760 It's so fascinating. Yeah. 578 00:29:24,600 --> 00:29:26,560 And that strategy could change, right, depending on what the 579 00:29:26,560 --> 00:29:27,880 market is? Yeah. 580 00:29:27,880 --> 00:29:30,320 And of course, like I said about zoning, right, it takes a year 581 00:29:30,320 --> 00:29:32,600 for New York State to approve a condo conversion, right? 582 00:29:32,800 --> 00:29:34,560 So I start the process this fall. 583 00:29:35,000 --> 00:29:37,280 By time we get to next fall and they decide that they're going 584 00:29:37,280 --> 00:29:39,840 to approve this, the whole market could be completely 585 00:29:39,840 --> 00:29:40,920 different. And who knows what it looks 586 00:29:40,920 --> 00:29:42,280 like. I'll probably still be fine 587 00:29:42,280 --> 00:29:43,880 because the worst case, I can keep renting them out as 588 00:29:43,880 --> 00:29:46,600 apartments. But you have to kind of make a 589 00:29:46,600 --> 00:29:49,520 calculated estimate on where things are going to be at some 590 00:29:49,520 --> 00:29:52,400 point in the future. Yeah, yeah, yeah. 591 00:29:52,680 --> 00:29:56,640 So, so crazy, man. But and then and that's where 592 00:29:56,640 --> 00:30:00,880 that right, that risk is, although how do you describe it 593 00:30:00,880 --> 00:30:02,800 as as like a calculated risk, right? 594 00:30:02,800 --> 00:30:05,280 Like you, you're I'm sure you're taking those things into 595 00:30:05,280 --> 00:30:08,800 consideration as you make plans and look at future markets and 596 00:30:08,800 --> 00:30:12,760 changes. What a what a fun game. 597 00:30:13,480 --> 00:30:15,280 Yeah. You know, I mean call it a game, 598 00:30:15,320 --> 00:30:17,800 but. It it is it business is a game, 599 00:30:17,800 --> 00:30:19,400 right? It's it's a game with 600 00:30:19,400 --> 00:30:22,160 consequences, but and but rewards, but it's a game you got 601 00:30:22,160 --> 00:30:24,560 to figure out how to move the pieces on the board and and make 602 00:30:24,560 --> 00:30:25,640 the right decisions at the right time. 603 00:30:26,400 --> 00:30:29,680 Yeah. So obviously a lot of growth 604 00:30:30,600 --> 00:30:34,200 over the last 11 years and constantly expanding and 605 00:30:34,200 --> 00:30:36,080 growing. And you know, even like on the 606 00:30:36,160 --> 00:30:38,520 commercial construction side, I mean you guys are not doing 607 00:30:38,520 --> 00:30:40,440 small projects. From the sounds of things, those 608 00:30:40,440 --> 00:30:43,960 are some pretty large construction projects. 609 00:30:44,280 --> 00:30:47,760 What what is what is the future look like for Green Spring Green 610 00:30:47,760 --> 00:30:49,400 Spring companies? Yeah. 611 00:30:49,400 --> 00:30:54,280 Each of the entities has their own kind of financial and like, 612 00:30:54,280 --> 00:30:58,840 I guess, performative goals. But speaking to Green Springs 613 00:30:58,920 --> 00:31:01,840 Capital, which is the one that I'm most focused on, the goal is 614 00:31:01,840 --> 00:31:05,240 to get to 200 million in assets under management by 2030. 615 00:31:06,520 --> 00:31:09,200 As of the end of this year, I think we're just slightly shy of 616 00:31:09,200 --> 00:31:11,600 50 a million assets under management. 617 00:31:11,640 --> 00:31:15,280 And keep in mind assets are all we own and manage all of our own 618 00:31:15,280 --> 00:31:17,040 stuff, right. So like this isn't like we went 619 00:31:17,040 --> 00:31:20,720 out and you know, I got an agreement to manage some 200 620 00:31:20,720 --> 00:31:22,080 unit complex that somebody else owns. 621 00:31:22,080 --> 00:31:24,000 Like so we're owning and managing pretty much everything. 622 00:31:24,400 --> 00:31:27,200 So we want to get to 200 million by 2030. 623 00:31:28,880 --> 00:31:30,920 And the reason we came up with that number is not just because 624 00:31:30,920 --> 00:31:34,400 it's a big fun looking number, although it maybe it is, but we 625 00:31:34,440 --> 00:31:36,920 kind of, I kind of went with like, hey, we have the vision of 626 00:31:36,920 --> 00:31:40,880 like, I want a leadership team, whether that's my partners or 627 00:31:40,880 --> 00:31:43,840 other people meeting these companies that could probably 628 00:31:44,000 --> 00:31:46,280 somewhere in the range of eight to 10 individuals. 629 00:31:46,320 --> 00:31:49,800 And we want to be able to pay them, you know, representative, 630 00:31:49,840 --> 00:31:52,560 you know, salaries, right? So like how big do we need to 631 00:31:52,560 --> 00:31:54,680 get in order to get to a level where we can pay all of these 632 00:31:54,680 --> 00:31:56,880 people? Two, $300,000 a year. 633 00:31:57,320 --> 00:32:00,280 They all are participating in some sort of bonus program with 634 00:32:00,440 --> 00:32:03,320 equity in our properties, you know, of $1,000,000 plus, you 635 00:32:03,320 --> 00:32:06,480 know, in cumulative total over the time of their working career 636 00:32:06,480 --> 00:32:08,440 for us. And what does that mean for all 637 00:32:08,440 --> 00:32:10,400 their families and everyone else that kind of works down the 638 00:32:10,400 --> 00:32:13,440 chains, right? So, you know, that's the way I 639 00:32:13,440 --> 00:32:15,920 kind of plan it out. Like where do we need to get to 640 00:32:15,960 --> 00:32:18,680 from a scale perspective to make sure that everyone, we affect 641 00:32:18,680 --> 00:32:21,560 this many people, I guess within our company structures, right? 642 00:32:22,800 --> 00:32:25,440 So it's not necessarily it is the money thing, but like for US 643 00:32:25,440 --> 00:32:29,600 money is like equating to freedom time, like flexibility, 644 00:32:29,600 --> 00:32:31,240 like all those things you're, you're pointing to. 645 00:32:31,240 --> 00:32:33,800 And it's different for everyone, but we kind of want to build 646 00:32:33,800 --> 00:32:39,640 that ecosystem that allows us to impact all of their individual 647 00:32:41,080 --> 00:32:42,360 families. And they're like, you know, 648 00:32:42,440 --> 00:32:44,160 they're extended families and whatever that means all the way 649 00:32:44,160 --> 00:32:46,000 down the chain from our company. But that's kind of where we 650 00:32:46,000 --> 00:32:49,240 ended up getting it to. And then of course, if we meet 651 00:32:49,240 --> 00:32:52,040 that goal, then we'll probably just push the push the line 652 00:32:52,040 --> 00:32:55,680 further and see where that goes. You're either growing or dying, 653 00:32:55,720 --> 00:32:56,160 right? Like. 654 00:32:56,160 --> 00:33:00,760 I mean, it depends on how, how much or how long we want to 655 00:33:00,760 --> 00:33:05,200 keep, you know, throwing gas on the fire here and seeing where 656 00:33:05,200 --> 00:33:07,200 things go. But we're all fairly young. 657 00:33:07,200 --> 00:33:09,400 So we got a, we got a long runway ahead of us. 658 00:33:09,680 --> 00:33:10,600 Yeah. Yeah. 659 00:33:11,600 --> 00:33:13,080 All right. Last question I have for you 660 00:33:13,080 --> 00:33:17,440 here, Brian. Is there one question that you 661 00:33:17,440 --> 00:33:32,320 hoped I'd ask that I didn't ask? Maybe why we pivoted from wholly 662 00:33:32,320 --> 00:33:34,800 owning everything and kind of self funding it to working with 663 00:33:34,920 --> 00:33:37,240 individual investors because that's a whole different 664 00:33:38,320 --> 00:33:42,720 business model. Maybe that that's one pivot that 665 00:33:42,720 --> 00:33:49,440 I think most real estate developers don't get to. 666 00:33:49,440 --> 00:33:51,520 I think like 'cause you have to get to a certain scale for that 667 00:33:51,520 --> 00:33:56,240 to make any sense. But had you asked it to me, I 668 00:33:56,240 --> 00:34:01,560 would have to answer it by saying really was it kind of 669 00:34:01,560 --> 00:34:02,760 extends out to what I just said, right? 670 00:34:02,760 --> 00:34:05,320 When I say like we want to create financial freedom for the 671 00:34:05,320 --> 00:34:08,000 people in our team and our partners, that extends out to 672 00:34:08,000 --> 00:34:09,960 friends and family, right? And most of our investors are 673 00:34:09,960 --> 00:34:12,639 friends, family of mine of ours, like our partners. 674 00:34:13,080 --> 00:34:16,000 And we want to kind of give them a platform that allows them to 675 00:34:16,000 --> 00:34:19,000 participate in what we know to be the best investment vehicle 676 00:34:19,040 --> 00:34:21,159 that we have found, which is real estate. 677 00:34:22,000 --> 00:34:23,760 Because normally they wouldn't have access to it, right? 678 00:34:23,760 --> 00:34:25,760 Or they don't have the time or they have full time jobs like 679 00:34:25,760 --> 00:34:28,080 they don't want, they don't go out and be a landlord, right? 680 00:34:28,080 --> 00:34:30,840 So if they partner with us, we basically do all the work and 681 00:34:30,840 --> 00:34:32,320 they, they get the benefits, right? 682 00:34:33,679 --> 00:34:35,920 You know, and then also from our perspective, it allowed us to do 683 00:34:35,920 --> 00:34:38,880 bigger and bigger projects because at some point our 684 00:34:38,880 --> 00:34:41,000 personal balance sheets weren't big enough to kind of 685 00:34:41,159 --> 00:34:42,639 accommodate some of these projects, right? 686 00:34:42,639 --> 00:34:45,440 So we have to, how do we make this work for everyone where we 687 00:34:45,440 --> 00:34:48,199 can kind of keep doing bigger and bigger deals and now we can 688 00:34:48,199 --> 00:34:50,760 benefit, give this opportunity to our friends and family to 689 00:34:50,760 --> 00:34:52,120 kind of come along and ride with us. 690 00:34:53,199 --> 00:34:57,440 So that's why we we made that pivot and on certain projects we 691 00:34:57,440 --> 00:35:01,880 bring on kind of limited partners in our deals, although 692 00:35:01,880 --> 00:35:04,880 not not on all of them. It's kind of a project dependent 693 00:35:04,880 --> 00:35:06,760 thing. But there's the answer to your 694 00:35:06,760 --> 00:35:07,600 question that you can. Ask. 695 00:35:07,600 --> 00:35:12,160 All right, yes, I'm glad I asked that question. 696 00:35:12,160 --> 00:35:14,800 Well, Brian, if people want to learn more about you, more about 697 00:35:14,800 --> 00:35:17,320 Green Springs and all the things you guys have going on or maybe 698 00:35:17,320 --> 00:35:19,800 how they can get involved, where do they find you guys? 699 00:35:20,640 --> 00:35:23,800 Yeah, I find this our website, which needs a little bit of an 700 00:35:23,800 --> 00:35:26,760 update that Mike's working on or he's going to work on Green 701 00:35:26,760 --> 00:35:31,080 Springs capitalgroup.com. You can also, you know, you can 702 00:35:31,080 --> 00:35:34,040 simply just send me an e-mail. It's brian@greenspringsco.com. 703 00:35:34,640 --> 00:35:37,640 Happy to have a conversation. If you're looking to get into 704 00:35:37,640 --> 00:35:39,960 real estate or you know you just have questions on being an 705 00:35:39,960 --> 00:35:43,560 entrepreneur or business, what have you always available like 706 00:35:43,560 --> 00:35:45,480 to have those conversations? Amazing. 707 00:35:45,840 --> 00:35:47,760 Love it. Thank you so much for coming on, 708 00:35:47,760 --> 00:35:48,800 Brian. I really appreciate it. 709 00:35:48,800 --> 00:35:51,840 Appreciate taking the time out of all those things that you got 710 00:35:51,880 --> 00:35:55,360 going. It's you know, I, I mean, we, we 711 00:35:55,360 --> 00:35:57,520 know each other and we've had conversations, but I guess I 712 00:35:57,520 --> 00:36:00,280 didn't understand the full scale of all the things that you've 713 00:36:00,280 --> 00:36:02,640 got going on. So it sounds sounds pretty 714 00:36:02,640 --> 00:36:03,760 great. Well, thank you, Mike. 715 00:36:03,760 --> 00:36:06,440 Appreciate the platform. And Matt, next time we're going 716 00:36:06,440 --> 00:36:11,920 to get you, get you a question. And of course, thanks everybody 717 00:36:11,920 --> 00:36:14,520 for listening. You can find these episodes and 718 00:36:14,520 --> 00:36:17,120 all the rest of our episodes of Buying Local dot US. 719 00:36:17,160 --> 00:36:20,480 And of course, we publish our podcast on Spotify, Apple Rumble 720 00:36:20,480 --> 00:36:22,960 and YouTube. Appreciate everybody listening 721 00:36:22,960 --> 00:36:24,560 and you'll hear from us next week.