GI81: Syndicating Commercial Development Projects with Shannon Robnett

GI81: Syndicating Commercial Development Projects with Shannon Robnett

Shannon Robnett has been in the real estate industry for over 40 years. He has been involved in over $200 million worth of construction projects including; apartments, police and fire stations, churches, office buildings, industrial flex and warehouse space. He is developing and building over 400 multifamily units this year alone.

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Announcer:
Welcome to the Global Investors Podcast, a show that focuses on helping foreign investors enter the lucrative US real estate market. Host, Charles Carillo, combined decades of real estate investing experience with a professional background in international banking to interview experts in all areas of US real estate investing. Now here’s your host, Charles Carillo.

Charles:
Welcome to another episode of the Global Investors Podcast; I’m your host Charles Carillo. Today we have Shannon Robnett. Shannon started building and developing in 1993. He has been involved in over $200 million worth of construction projects including; apartments, police and fire stations, churches, office buildings, industrial flex and warehouse space. He is developing and building over 400 multifamily units this year alone.So thanks so much for being on the show. Shannon.

Shannon:
Thank you Charles. Glad to be here.

Charles:
So give us a little bit about your background prior to starting your, your current businesses.

Shannon:
Well, you know, my, my mom is a third generation realtor. My dad is a as a was a general contractor. And so I grew up at the dinner table here in about 10 30 ones about, you know these guys want to rent warehouse space, but we can’t find any, you know, mom trying to find somebody something. And then dad going, well, there’s this lot available. We could build something. And so I, I mean, you know, as a kid that saw 10 31 exchange happened at the dinner table at when it first became a law that you could do it. Right. I mean, that was back in the early nineties. And so I are early eighties. And so I always grew up with that and I didn’t know anything else. I, I used to think that, you know, my, my Fridays after, after school, my Saturdays on the job site was, was more like an indentured servant, but I realized that that was my apprenticeship. Right. And I, and so I, I got out of I got out of high school. I thought, I’m, you know what, I’m going to go to college. I’m going to do this college thing. And, and I’m sitting there working at a coffee shop to pay my insurance on my car while I’m living with my parents and I’m going to college and my brother’s out building a house and I see what’s going on. And I, and I know this is, this is in my DNA. This is what I, you know, this is what I’ve seen my whole life. So I am a college dropout. I, I went for a whole semester. Well, I mean, they wanted me to show up to class. I didn’t, I didn’t like that part about it either, but so I kind of just always grew up in that industry. And, you know, I’m sitting there working on a job site for my dad getting a little bit more knowledge and I’m talking with my crane operator and he’s like, man, I really wish I could have a yard. I got all this equipment to store. I’m getting to know the neighbor lady she’s in her late sixties. Her son who’s mentally disabled is in his thirties. They’re trying to think about getting off of the three acres in the 40 year old house that they have. I put two and two together and I didn’t use my last 500 bucks. I used my only 500 bucks to write the real estate contract on that land. Right. And then I got an entitled through the city and I made that a condition of my purchase. And so I get entitled and, and change it from what it is to industrial. And as soon as that happens, then I sell it to the crane operator and I do a simultaneous close and I make a hundred grand at 20 years old. Right. And my dad’s paying me like $30,000 a year. Right. And I’m just, I’m hooked right at that point. I know that this is what I have to do with my life, because this is great money, but it’s about solving two people’s problems that don’t know each other. Right. And if you really look at what I’ve done with my career, it’s about helping people understand what they need to build, helping people understand what they need to do for investing, helping people solve that problem. And so I don’t know that I solved anybody’s problems before I got into this business, but that’s all I’ve done since I’ve been in this business and I’ve been in this business my whole life.

Charles:
So your, your first deal was being had was a wholesale deal. And what, how did you get involved after that further into investing in developing?

Shannon:
Well, was it a wholesale deal was of a flip because I technically closed on it for like three minutes. I own double close. Don’t wait, you know I, you know, I got another one where I actually had seven transactions all lined up that hit one through the other, through the other one time and my title agent she never recovered from that, but, but you know, I went from there and I, and I saw that, okay, construction, you know, has an element to this. And then I, there, there was other things that became a part of that. And so I built a couple of houses, you know, where we actually built the houses. I mean, we dug the foundation, we put in the sewer and the water, we framed it, we built the cabinets, we painted it. You know, you could build three houses, maybe four houses a year like that. And I learned that I didn’t like homeowners, right. Not that I didn’t like them, but everything was personal with them. Right. The door doesn’t close. Right. You must have wanted me to have a bad door. You know, why is this not perfect for me? I mean, well, because it’s a house built by humans. Right. And so that steered me right away into commercial. And I did, I started doing offices and warehouses and industrial space, and I was pretty good at that. And then I started to see where I could own it. Right. And when the light went on for me, that I could actually achieve what my father had achieved, what my mom had achieved at the age of 28. I built my first warehouse. Right. And in 2000 I completed that warehouse. Right. So those are you, the quick math, you know how old I am, right. In 2000, I completed that warehouse and those tenants are still there. I still have three of the original tenants that are in that warehouse. Right. And so here you have a building that is paid for by the tenants in a very similar situation to multifamily, except that it’s a complete triple net asset, right? So the taxes go up, it doesn’t bother me. The insurance goes up, it doesn’t bother me. We have a huge snow year, which guys face a lot in Florida, right? No removal goes up, the tenants pay for it. So all of those things were there. And I just realized at that point, I need to be more involved in investment grade. Then I need to be involved in construction for hire. And so that’s where my career path took me down that road. And then I, it wasn’t until I was probably about 32, 33, that I really realized what a cap rate meant to me because I could build it for $300,000. When I put the tenants in it, it made it worth $400,000. And then I could sell it as an investment grade property. And I could make the profit as the builder, and I can make the profits of the developer by stabilizing it. Right. And that’s when I went, Oh, my goodness started getting a couple of partners doing some deals, doing some side stuff. And over the last couple of years, I’ve just kind of outgrown my partner’s abilities to write checks. And so I’ve gotten from there, I’ve transitioned into the syndication fundraising world with 25 years of experience, I’m, I’m, you know, I don’t have a full year of syndication under my belt, but because I’ve yeah. And the $200 million in transactions that you referenced earlier in the show, those are just my personal transactions where I was the buyer or the seller. Right. So I’ve been involved in my fair share. And now I’m transitioning to the point where as a builder, as a developer, I am bringing the syndication model to investors who can then invest in new construction instead of value add.

Charles:
So unlike other real estate investment firms, your company is vertically integrated. So can you explain a little bit about your strategy and your normal business plan and how you go about executing it?

Shannon:
Sure. So, like I said, we do new construction instead of value, add and value add is in some ways it’s a lot easier because the bank can look at it and say, there’s already cashflow. So Charles, we understand you’ve never done one of these before, but there’s cashflow here. We know you can’t screw it up that bad. Right. and then the, the, the investors can look at it and go, well, Charles has found this deal that appears to be about 10% under market. There’s already cashflow. We can look at what the cashflow is. The balance sheet says this. We can look over here and we can see where they’ve done the same thing, but it’s a a hundred bucks more. And so we can put two and two together and we can kind of come up with that, right. In new construction, you can’t lie to yourself. Right. You can’t be, you can’t get confused with the spreadsheet. So you go in and I’ll give you an example of a deal that we’re we’re about halfway through, on, it was a 36 unit apartment complex, my costs on it for the land, my finance cost, everything was $5.3 million. Okay. Because I’m going with bank financing, I’m going to get an appraisal. I give it to the appraiser. The appraiser does his job. I get an appraisal of $6.3 million. I know at that point, there’s a million dollars to be made just by turning it from sticks and stones. Like I talked about earlier into a stabilized asset. So I know there’s a million dollars to be had. Right. So then I go to the bank and I say, Hey, what are you guys going to give me? They say, we’re going to give you 60%, 65% loan to cost. So they give me a $3.7 million construction loan. I see you doing the math over there. Right. So I got to raise 1.8, $5 million. So I put in 250 of my cash, right? And then I raised one, a million and a half box. And for that, I gave the investors 35% of the upside. So they are 35% owners. So when we build it, when we stabilize it and when we liquefy it, right, when we have the liquidity event, they will get 35% of that million bucks. Right. And then a lot of people, people look at that and they go well, but isn’t new construction riskier. Well, it can be, if you don’t have a contractor that can perform, it can be, if you’re going to get stung with a bunch of change orders, because you don’t have the proper contract in place. And so at that point, we are the vertically integrated because we’re the developer, we’re also the general contractor. So we know that we have a G max contract. There is no way that we can charge any more than that because we are involved in the plans, right? So it doesn’t matter if we find lava rock underneath, we’re eating it. Right. And that gives us security to the investor. Then we are the property management company, right? Because property management is one of those dicey things, property management companies that are there for their own profit don’t necessarily tend to pay attention to the asset. So the, the thought process of asset management versus property management, where, Hey, you know what we want to get, we get a hundred dollars for a renewal. We get $200 for a, for a new lease. We’re going to make sure this tenant moves out. The property owner is going to take the 15% or 15 day bake ancy. Plus, they’re going to have a cleaning bill that won’t be covered by the security deposit and some new carpet that’s going to go in. They’re going to have some expenses, but we’re going to get 200 bucks. Right. And we’re going to raise the rents. But if you really do the math, maybe keeping the 10 that you’ve got is a better idea. The other thing is when you’re dealing with new construction and you’re dealing with the initial lease up, it’s very important that you’re aligned because concessions can kill you because when you, when you give the concession, it figures into your overall NOI. So through that growth pattern, I’ve just realized that I didn’t want to get the call at two o’clock in the morning when the toilet backed up, I didn’t want to have to be at the leasing office, but I needed that kind of a attention to detail that wasn’t concerned with the bottom line of the property management company. It was concerned with the NOI of the project, right. Because in that perfect example, my property manager brought on the idea of, of reselling cable, TV, and internet on one of our properties. So 180 unit property, right? We’re making $35 a door on 180 units on a five cap. My guy brought in an idea and made the property $1.8 million, more valuable. You can’t tell me that a 3% or a 5% fee offsets what that guy did. Right? And so, again, that alignment of having an asset manager versus a property manager, that mindset combine that with the construction company, that’s making sure that the developers budgets work or the developer who is the construction manager, eats it, and then you’ve got the whole property. So that’s how we came to that lineal transaction, where at the end of the day, we have a fully stabilized product. That’s now ready for resale.

Charles:
So you’re, you’re starting off with a construction loan and I’m at 60% loan. The cost, as you said, is a pretty standard. That’s what you just had on your recent deal. What happens? What are you? What’s the normal timeframe on these deals? So if it takes two or three years to build, are you then going to stabilize it and sell it at that point? Are you going to stabilize it and put permanent financing on it? What is normally the business plan, the exit strategy you like,

Shannon:
Well, you know, Charles, as I admitted earlier, I’ve been in this business for 25 years, but I’m in the syndication. I’m newer to that. Right. So what I’ve done is I’ve looked at everything in a short term scope, right? So we’re going to get it up. We’re going to get it stabilized. We’re going to make that commitment to work together right on this particular deal we’re discussing. I figured it would take me nine months to build, okay, that’s all it takes in Idaho nine months to build it three months to stabilize it, right. Because it’s only 36 units, right. So that’s not, that’s not terrible. They’re also going to come on. The first building is going to be available in seven months, one in eight months and one in nine months. So I, I really have, you know, five months to stabilize from the first building to the last building at that time, my investor group. And I are going to agree that we’re going to sell it. We’ve already had three unsolicited offers at quite a bit more than appraisal because there’s no product in the market right now, as we all know. Right. and so what we’ve done is we’ve agreed that we’re going to get to this point because here’s the difference between value add and new construction. Okay. So in value, add, you’re going to get about a, maybe you’re going to get a 10% discount. Okay. That means on a $10 million property, you’re going to buy it at 9 million bucks. Right. And you’re going to show your investors that, Hey, we can make a million bucks on this deal. Right. We can make 10% on this deal. And then we’re going to expend a million dollars. Right. It’s going to go from the three palms to the Oasis. It’s going to go from hot pink and teal, right? I mean, I’m trying to keep it. I’m trying to keep it Florida colors for you. So you follow along with the Charles Wright but you’re going to rebrand it and it’s going to be all about you and you’re going to redo it inside. And you’re going to spend that. And then you’re going to pull that lever to force the appreciation that’s then going to put you back to 10% value on your total expenditure. And then you’re going to ride that trajectory for eight, 10 years until you get the big payoff. None of that happens in new construction, new construction, that payoff happens the minute that, that thing stabilizes. So my investors at at 12 months are going to be sitting there with a 28 to 34% return for a year. Right. That’s all the longer our get together is now, as you know, Charles, when you take, and you’re looking at a six cap or a seven cap, that’s the rate of return you’re going to get. So if you’re getting a seven cap return, combine that with your 30% return, you just shot your thing down into double digits of the 19% variety. Right? So when you’re looking at that, I’ve identified in my group that there’s those that want growth. And there’s those that don’t don’t want stability. They want that ten-year deployment of capital, but they don’t like a value add because they don’t like the fact that you’re going to repaint this thing. You’ve got to spend all this extra money. There’s those things. So we are really working with the growth individuals to get to that first Terminus of the, of the contract and says, okay, we built it. We stabilized it. We did everything we said we were going to do. Now we’ve got a liquidity event. Whether that means that I’m going to bring in another group of investors or sell it to an independent third party. We haven’t decided that yet. Because like I said, I haven’t been doing this that long, but I have been in the construction and development field for over 25 years.

Charles:
Yeah. That’s pretty interesting because I, you just so many different things are going off here. For me, the, I never thought about having, having two different investor groups with it, and one that wants to see, put their money out and know that they’re not getting the typical quarterly distribution from a month three. And then the second is you know, transitioning that group of limited partners out and then bringing another group of limited partners once you’ve, once you’ve kind of stabilized the whole property once you’ve got it operating. And having someone else that says, you know, I want to make the whatever, 8% cash on cash or 10% cash on cash. And then the other people that put their money out there and don’t want it back for a year or so. They’re already out of the deal and they might be into your next deal. And so that’s great. You’re covering both because it’s just, I imagine when you’re speaking to investors, like you said, you’re going from more of a growth investor, but it also allows you now to cater to both investments, investors kind of mindset. And I imagine you’re going to have, because if I was one of your limited partners, I want a little bit of everything. Maybe I’ll be more on one side than the other, but it’s great to, Hey, leave part of my money and then right. It’s the other side and stuff like that.

Shannon:
Well, I mean, and if you look that, you know, Charles There’s some investors that don’t, I mean, the, the goal, right everybody’s goal is to have a big enough pile of cash that has six or seven or 8% cash on cash return allows you to ride off into the sunset. Right. and, and not have to worry about anything, but swinging by the mailbox once a month. Right. But the reality is most people don’t have a big enough pile of cash right now. And so just like you said, we have thought through the scenario that let’s just say, Charles, you invested a hundred thousand dollars, you’ve made 30,000 on that money. You leave that in the second syndication, you take your original profits and you move forward or your original investment and you move forward. And so you’re creating some of that lower cashflow, right. But you’ve taken all the risk out of it. You’ve got brand new furnaces, brand new carpet, brand, new parking lots. You don’t have something that, Oh my gosh, we didn’t know that there was a sewer line that ran into the building that a tree root gram Grove through. Now we’ve got a $40,000 cleanup bill that nobody knew about. Right. We don’t have any of that. So taking a seven or an 8% cash on canceling, turn on a stabilized brand, new investment is a much better deal than, than taking an 8% return on a value add that these things are figured in and going to happen. Because at the end of the day, you, you don’t have those things, right. You’re, you’re, you’re going to be in a better position because you know, our, our overall expenses are run at about 30, 31% on brand new on the projects we, we built in the last three years. So we’re running a much lower expense ratio because we don’t have furniture that we have to replace. Right. We’re in the, we’re in the phase where we’re putting $250 aside like everybody does, but it doesn’t go immediately out the door because we had, you know, 14 C just lost its AC, and now we gotta go replace that. Right.

Charles:
Yeah. And traditionally to listeners out there when you’re looking at multifamily, it’s usually the rule of thumb is 50% they are going to have. So you can see it’s almost as half as what he’s running, cause it’s new construction. So,

Shannon:
But but all of that, you know, my management is still close to the same. My maintenance is lower. And then my, this my expenses, you know, really my expenses.

Charles:
So let’s talk about that. I mean, every, it sounds great being vertically integrated, but you know, you’ve obviously done so many deals hundreds of millions dollars worth of deals and you can make it work now, how does that work in regards to focusing and specialization? Does that go out the window when you’re working with a group of a group of businesses and I mean, everything’s complimentary, but how does that, how do you, you know, you made the decision, how would you make the decision to go into all these different places? And then just saying, Hey, we’re focusing on development in the contracting or some other piece of it.

Shannon:
Well, you know, Charleston, the thing that I learned going back to the kitchen table, as I learned how I watched my parents be property managers, right. I watched my parents go through all of that. And so I saw what it took. And in the beginning I was my own property manager. And then I had I had my brother-in-law, he came on board and he was taking care of some of that property management. And we learned a lot about property management, right. I mean, I, I had my first property management company in Oh six. Right. So, so I’ve had a property management company in one form or another for, for quite a few years. But the reality is I learned what worked for me for an asset. Right. And, and so, but what, I’ve, what I, what I know most about myself Charles, is that I am a 30,000 foot view kind of guy, and I need to have the right people in place. And what I found is that you can use my biggest, my best talent is finding the right people, right? That’s what I, if you asked me, what do I do best? It’s finding the right people to put in the right places that do the right things and make the right choices and come specialized. So when I, when I w w needed a property management guy, again, I went out and found the best. I went out and found the best, and I made him a deal. He couldn’t refuse. I pay him really well to do an exceptional job. And he is tied to the bottom line when I needed to level up on my construction management. I found a construction manager who was one of the best. I, I tied him to the bottom line. So he’s made, he’s making a great wage, but he’s got more than that on the line. And so, you know, my, all of my people are bought into the deal both before and after their paycheck, right? Because you can’t train loyalty, you can’t train personality, you can’t train those kinds of things, but I’m here to tell you, you could train a monkey to do property management, right. You can train a monkey to pull the right lever, to get certain things to happen, but you can’t train somebody to be loyal, to be the go getter, to be the follow-through person. And that’s the kind of, of talent that I’ve been able to locate and find and put in those places, it’s only taken me 25 years, Charleston. It’s really an easy thing to do, but once you have it, it’s, it’s irreplaceable. Right. And so I’ve got a machine right now that I can run from anywhere in the world. Right. That happens on a consistent basis because of the people that are involved and more because of the people that are involved and because I’m involved.

Charles:
Yeah. People’s people and systems, that’s it?

Shannon:
Correct? That’s correct.

Charles:
The that’s awesome. I mean, that’s, it’s a great way of doing it and how you you know, I was speaking to another developer years back and that’s where they always told me, I when I want to start something new or I’m doing something new, it’s always, I find the best person that’s doing that. I pay them a lot more and they come work for me. And then I don’t, it’s, you’re paying for having less hassles and you’re paying for someone that’s done it before, and I don’t have to train. Right. So

Shannon:
I learned that growing up, my first property management company, we lost more money than we ever thought about making, you know, because we thought everything from the owners point of view, not running a company’s point of view, right. And you’ve got to blend that. You’ve got to say, what makes the owner successful? And the reality is people go running out. There they go. I have to have every apartment complex out there. No, you don’t. You have to have the ones that understand that you bring more value than you cost. Those are the only ones I’m interested in working with. And when people can realize that, Hey, listen, we’re going to bring things like cable and internet. We’re going to bring things like lower overhead. We actually have a gal. Most people in our marketplace are paid quite a bit less than our people. Okay. But we have people that have pride in their work that always answer the phone that have 97% collection rates that have everything you could possibly want. That when you look at the NOI on this property, you can’t justify to me why $20,000 a year is going to break this property. Right. When you look at the results I can get for you, but when I’m talking to somebody that goes, yeah, but you’re charging me more conversations over, right. I’m not speaking the right language with this person. And I’m wasting my time to try and convince them that going for the bottom dollar in the cheapest property management is not something they want to do, because if I can’t explain to it in 10 minutes, what a cap rate and what my people can do for their property.

Charles:
No, no, for sure. And it’s also the other thing too, is that I think when I’ve ever dealt with truly successful and wealthy people, they’re paying for, they don’t mind paying more to make their life easier, or for one part of whatever they’re trying to do to run smoothly. And when you’re dealing, I think that’s a very frustrating thing when I’m speaking to people that are new investors, and you’re like, you know, if they’re doing a good job, this is what you want. You know, this is you have to, you have to change your whole mindset. And if you’re worried about someone that’s charging you between five and 6% of management fee, but they have minimal turnover. Now you have to, it’s, it’s a big picture. It’s not just what monthly they S you know, their checks that’s coming out of there.

Shannon:
But well, and, and, you know, Charles, you said it right there when you’re dealing with the new investors, a lot of times the new investor has never sat down and added up the time that they have in it and put a dollar to that time. You know, I mean, by the time you pay a basic person you put some work comp on him, you know, you’re 35, 40 bucks an hour. And if the investor actually added that to it, I mean, when was the last time the new investor went and fixed the doorknob and made four trips to home Depot and spent all of a Saturday, but yelled and screamed when you charged him 90 bucks to do the same thing. Right. You know, and I would love to know how you guys get your property management for 6%. We’re at nine. Right. But we bring so much value that our people go, Holy crap, you added, you added 15% to my bottom line. Who cares if you’re 3% more than the next guy, look what you’ve done. And we prove that every single time with what we do. Right. Right. And I would love to say, that’s all me. I wish I could say that was me being that smart. But it was me getting my property management guy to understand what the leverage was on the cap rate and him to go, Oh, well, we could change this system. It would improve our cashflow. It would save us money here. It would do these things. It would do this. And then our analyze better. And we come in and we clean things up and we simplify things and we make the property make more money through very simple little changes that make everybody more profitable. And all of a sudden, the 9% property management is a fraction of what they received in value in the property.

Charles:
Yeah. Well, that’s, that’s that’s good business. I mean, couldn’t be any better than that. That’s a good business for everyone. Cause then your tenant all the way down the line, everybody’s being taken care of better. And everybody’s become more more successful in what their endeavors. So with all these different businesses, how has COVID over the last several months and now into the future affecting your business, isn’t it,

Shannon:
You know, it’s really helped me to appreciate the people I get to work with. You know, it’s not that we’re on lockdown individually with each other, but, you know, communication over zoom, as you know isn’t always the easiest, but there’s something about an in-person meeting that just changes the dynamic of everything. Right. But I’ve really seen how my, my team is really excellent. I’ve seen how my team has gone above and beyond. We’ve had some issues with, I mean, when COVID first came out, we know that our customer is the tenant. Our customers, a property management company is not the landlord, right. The customer is our tenant because we got to keep that tenant to keep the landlord happy with us. Right. And so we immediately reached out. We said, Hey guys, we want to know what’s going on with your situation. You know, we’re gonna, we’re gonna suspend a couple of these additional charges that we have. We’re going to give you free cable. You know, w we, we did a couple of things like that because we closed the amenity. Right. and so we were able to do that, but we really made sure that our people understood. We were taking some, some rent on a weekly basis. We had several people that needed assistance. And instead of sitting around my property management team, jumped on line, figured out how to get public assistance for our people. And instead of trying to give this to somebody who’s just come back from working 40 hours for the day, for the week is trying to juggle childcare, trying to get kids working from, you know, school, from home, the other spouses in the apartment, instead of all those things happened. And we got really good at filling out the paperwork. So for an hour of our time, we guaranteed that we collected for our other customer and kept our first and primary source of income happy. Right. And so with just that little bit, an hour of filling out paperwork, we kept our collection rate at or below where it was. And so for me, COVID has really helped me to appreciate my team. My team is honed at skills on, I mean, now we got, now we got Ninja skills right now. We’re, I mean, we are really good. We can, we can do this block I unfold. And now we know that regardless run into hard times because people are always going to have those issues. Right.

Charles:
That’s great. I mean, it’s well, I was one of the first things we did with one of our property, third party, property managers to, you know, they sent out the form with all the different websites and stuff that all different places, employers that were hiring pretty much right. You know, click the click on it. And you’re going right to a page where you can apply for a job and whatever else you need. And then you know, really stressing if you have an issue, come talk to us. And I mean, I think everybody wants that everybody. I think landlords I’ve always seen it as being a landlord and being on asset management with third-party manager or self managing it myself is when I don’t have the contact with that tenant or with that contractor. That’s when I get worried, if you tell me you’re going to be a day late or two days late, or you need another week fine, just, you know, you have that conversation. And we know when it’s silence, radio, silence, that’s when you’re worried. And that’s when you’re like, this is, this is the, you know, now you’re, you’re, you’re you’re hoping for the best, but you kinda know it’s going to be the worst,

Shannon:
But you know, Charles, the funny thing is the difference between that communication, that radio silence is the tenant understanding that you’re on their team. You know, when you really look at it, I mean, it goes back to, you know, there’s been situations in my life where I have not, I don’t want to run into so-and-so. Right. I don’t want to see them. I don’t have good news for them. That deal didn’t work out. Like they thought or whatever. I don’t, I don’t want to see, you know, this happen. And so I pushed back from the situation, but if I know that that situation is fine, I’m okay to see the person. Right. And that’s one of the first things that our people did was they knocked on doors and they said, Hey, are you okay? Is there anything we can do for you? We are property management and here we are here for you. And when people had that, we had everybody that had a problem came to us. Right. We did have one skip in the middle of the night. Everybody does. Right. But it wasn’t because we didn’t reach out. We could have had with the units that we have, we could have had a lot more than that, but I feel that my team and their personal touch, cross that gap that you just talked about where now we know, because they know the world K with whatever you decide. Yeah. We’re here to help you as our customer.

Charles:
Yeah. Yeah. And that’s the other thing too. I was hearing from a lot of landlords during, and they’re like this, person’s not paying, they want to leave them, let them go. I mean, you can rent it. Do you want someone sitting in there and not paying rent for now? It’s, you know, with all these different moratoriums and all different States and federally, it’s something that if, just let them go, you’ll, rerent it you’ll make sure they leave it clean and your shake hands you’re done with it. And you know, do some paint, do some few hundred dollars for the cleaning on it and you’ll get rented within one week. You know what I mean? And that’s one thing with the multi-families. We didn’t have any we didn’t have any lack of people looking traffic, right. Looking to rent. So it’s like at that point, you’re like, you’re not, you’re not going to bring this person to collections. You’re not gonna get a penny. If you do, don’t do that. Just let people out. It’s going to be fine. I’d rather have somebody leave me the apartment clean and, you know, broom clean. And we’ll take care of it from there. And hopefully everything works out for you. You know what I mean? And we’ll, we’ll leave there. But what do you think are the main factors that have contributed to your succession?

Shannon:
My people, without a doubt, it’s the people that I’ve surrounded myself with. It’s the it’s the quality of, of, of my employees that I think of as my partners because I can only, I mean, I can only do so much. I can only be excellent at a couple of things and I need other people to be that excellence for me. And, and having the quality of people that I have in Jeff and windy and, you know, Leanne, I mean, I’ve got a long list. Right. But, but having those people be who they are is what my success is really all about. And, and it, it, I, I, I’m honestly not the kind of guy that is. I mean, I’m, I’m not that intelligent, right. I, I’m not that brilliant. What I am is I’m, I’m tenacious and, and I’m driven and with the right team around me, we can get a lot done. Yeah.

Charles:
Nice. So how can our listeners learn more about you and your companies?

Shannon:
So Shannon robinette.com is where we’re at. That’s where we hide. You can find me on Facebook, LinkedIn, Twitter, you know, I’m everywhere there. Even Instagram, you know so you can find me there, or you can go to Shannon, Robinson industries.com. You can see about our offerings there. You can see what we’re doing, what’s coming through the pipe, all that kind of stuff.

Charles:
Yeah, it was great. I was on that website yesterday and a ton of information. You’ve got a connection.

Shannon:
The new one launched in June in December, like I said, new to the whole syndication world. This is our third rendition. You’re going to see some really incredible stuff. Come out on the features on that. So December one, we’re launching a new one, come check it out and try and blow it up.

Charles:
Awesome. Lots of resources on there. So I will put all the links to everything you’ve mentioned into the show notes and into YouTube notes. So thank you so much for being on today,

Shannon:
Charles. I really appreciate the opportunity to share what I know with your listeners, and I hope you all found value in it.

Charles:
Hi guys! It’s Charles from the Global Investors Podcast. I hope you enjoyed the show. If you’re interested in get involved with real estate, but you don’t know where to begin, set up a free 30 minute strategy call with me at schedulecharles.com. That’s schedulecharles.com. Thank you.

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About Shannon Robnett

Shannon has been in the real estate industry for over 40 years. He has been involved from start to finish on over$200,000,000 in construction projects covering the gamut from multi family, professional office buildings to City hall’s, fire and police stations, schools, industrial and mini storage. Shannon says that there is phenomenal growth in just building, filling, and selling a product. Shannon further explains that his operation is different than most because he is looking for syndication partners that are seeking tax-advantaged situations and his main clients are using IRAs to invest; not clients looking for small monthly cash flow investments. Another reason Shannon is different is that the majority of the projects are ground up developments. Shannon and his team have streamlined the ground up process making it a much more lucrative product to invest in. His team also completely rehabs a building, from pipes, roof, window, paint, everything that will keep these rehab investments profitable for 10+ years.

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