GI146: Purchasing Over 4,000 Units in Phoenix with Zach Haptonstall

In this episode, Zach Haptonstall gives us a glimpse inside the firm he co-founded, Rise 48 Equity. A Phoenix based investment company that has completed over $1.25 billion in transactions. Prior to Zach becoming a real estate investor, Zach was a live television news anchor and sports reporter for Arizona PBS and co-hosted a show on Fox Sports Network Arizona.
Zach began investing in multifamily in 2018 by founding ZH Multifamily and grew his portfolio to $35 million. In 2020, he closed ZH Multifamily and co-founded Rise 48 Equity in order to scale his acquisitions and his team.
Zach holds an MBA from the Colangelo College of Business at Grand Canyon University and his main responsibilities today include overseeing all acquisitions, sourcing capital and building strategic partnerships as the CEO of Rise 48 Equity.

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Transcript:

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 Zach Haptonstall. Zach is a former live television news anchor and sports reporter. He discovered Multifamily Investing and closed his first deal in 2019. Today, his company Rise48 Equity has a portfolio totaling over $143 Million in the Phoenix Metro. So thank you so much for being on the show, Zach.

Zach:
Yeah, Charles, thanks so much for having me, man. I really appreciate the opportunity to be on, on the show and hopefully we can provide some, some value to your listeners today. So thank you.

Charles:
Yeah. Yeah, sure. You can. So tell us a little bit about your background both personally and professionally and prior to getting involved in real estate investing.

Zach:
Yeah, sure. Charles. Yeah, so I, I don’t, I didn’t really have a background or any connections or family or anything like that in real estate. You know, I was kind of in a, a few different in industries prior to this. So I was born and raised in Phoenix, you know, just, you know, regular middle class family, you know, w two jobs for my parents. I I had a football scholarship to a small school in Colorado outta high school. So I went there for a bit, you know, I wanted to play in the NFL. I realized I wasn’t good enough. Wasn’t big enough. And so I was like, oh, okay, well then I want to be a sports reporter. So I got a journalism degree at Arizona state university and I was actually a live news anchor for Arizona PBS for a short time and post a show on Fox sports network.

Zach:
And that was cool at first. And then I just quickly realized, you know, you don’t make any money doing that. It’s crazy, crazy hours, very political, not what I wanted to do. So I was like, man, I to make money, I had school debt, you know? And so I started I was working nights and weekends delivering medical equipment going while I was going to college. And so after college, I kind of transitioned to that into healthcare marketing. So I was working for a hospice organization, basically cold call and walking into hospice’s doctor’s offices, assistant living, and just building relationships with physicians, social workers, nurses, et cetera. When they had patients who needed mobile hospice care at home, they would call me, I’d be the first person to go meet with them, educate the family, get them signed up. And so long story short, it sounds kind of weird, but it’s a very lucrative and competitive private business industry, you know, all regulated and reimbursed by Medicare, the federal government.

Zach:
So I did, I, I did well in that became a director marketing and then a co-owner in the company. I got my MBA, I paid off all my school debt. I bought a house. So I was blessed to be making, you know, six figures in my early twenties. You know, I was making more money than both my parents combined had ever made by the time I was 23. So I was fortunate in that sense, you know, to pay off debt, get a little bit of financial stability, but then after doing that for four years, I just kinda got burnt out, you know, and wanted the next challenge. It’s it’s always, what have you done for me lately in sales, right? Each month it resets. And so I didn’t know anything about multifamily or syndication, but I, I did have my real estate license. I hadn’t even used it at honestly at the time I just got as a backup plan.

Zach:
So I, and then anyways, long story short, January, 2018, I resigned, I sold my equity in that company. I had a few hundred K that I had just relentlessly saved and then gotten that pop from selling the equity, that company. And I said, okay, I want to create passive income so that I’m not always having to just grind it out, be the rat race, you know? And, and so I honestly was just thinking real estate in general. I didn’t know anything about different asset classes. I was, I, I had no plan, Charles. I was originally looking at flipping houses and then I was like, no, that’s transactional. It’s same thing I was doing in healthcare. And then I was looking at mobile home parks. I tried to buy a mobile home park on a seller carrier. I was cold con owners. And anyways, long story short, I found my way to multifamily. It took me 14 months from when I quit the job to actually closing on the first acquisition of multi-family, which was not a syndication. It was like a tenant in common. You know, I, I met a few partners. We all partnered together, put in big chunks of own money from there. We gained the experience, built up the syndication platform and have been very fortunate to kind of ride that momentum since then. So that’s kind of, kind of the, the long short summary.

Charles:
Nice. Nice. So what is your acquisition criteria in and strategy currently at at rise? 48?

Zach:
Yeah. Good question. So we’re, we’re based here locally in Phoenix. Okay. So there’s, it’s, Biron Robert myself. There’s we have 2, 3, 3 co-founders and principals. We now have 10 full-time w two salaried employees as part of our team. We have a business office here in central Phoenix, so there’s a full team of 13 of us. We’re only focused on the Phoenix Metro. Okay. Cause we’re all local here. We know the market very well. We’re looking for value add deals. Okay. So we’re looking for class B deals in a and B location. So 1980s, seventies, sixties, vintage, we’ll go in there and on the exterior, we’ll completely rebrand the asset. We’ll rename it. We do a new monument sign like an L E D backlight looks really cool. Helps with curb appeal, leasing activity. We do a new three tone paint. We improve the marketing and the landscaping on the exterior, depending on the deal, we’ll add amenities.

Zach:
So right now on a few different deals, we’re, we’re building fitness centers, playgrounds, dog parks, things like that. So that’s a we’ll do on the exterior, you know, completely rebrand it. Just to help that curb appeal on the interiors, we do a full interior scope. Okay. And so we, we consider ourselves Charles light value, add syndicators, meaning light. You know, we don’t like to build new structures or move walls or change floor points. So we don’t buy any lumber or anything like that, but we do a full interior scope. Okay. So on the interiors, we do a brand new gray vinyl plank flooring. We do a quartz countertop with an under Mount sink, a modern pull down plumbing, fixture, subway tile, back splash stainless steel appliances is we do brand new cabinet boxes, shaker doors, it brush Nick hardware, L E D lighting package two tone paint baseboard.

Zach:
So it’s, it’s basically on the interiors when we’re done, it looks like a class, a luxury interior, although it is workforce housing, which is 80 seventies, sixties vintage. And that’s, what’s allowed us to really be competitive in the market and get these pre premium rents in Phoenix. Because as you probably know, Charles, and a lot of listeners know Phoenix is undoubtedly. Yeah. The number one market in the country right now, fundamentally. Okay. So it’s, it’s number one for population growth for five consecutive years. Number one for rent growth, top five for job growth. There’s so many people coming here. So when you can have these premium finishes and it’s still an affordable product, we’re seeing a ton of demand for that.

Charles:
Yeah. So that’s very interesting. So you’re looking for, since you’re light value, add people you’re looking for properties that already have good bones, and then you’re gonna go in there and really kind of address it up. You’re going through with one of your packages to make it that a, a minus whatever B plus quality of, of a property. So how are you guys sourcing your deals currently? Are these all on market deals?

Zach:
Good question. So all of our deals have been through broker relationships and, you know, Phoenix is such a hot market. It’s so competitive. It’s very difficult, just like it is anywhere in the country, you know, but there’s not a lot of syndicators in Phoenix because they simply can’t compete with the private equity institutional groups. And so to answer your question, we really leverage our local broker relationships. Nine of our last 10 acquisitions have been completely off market with no competition from anybody else directly through broker relationships. Okay. So between the 20 to 50 million a purchase price space, we really do get a lot of the first looks from the top five, six brokerage groups because they know us, you know, I, I meet with them constantly. I’m constantly touring deals. I’m literally sending, this is no exaggeration. I’m sending six offers today. Okay. On marketed deals and off market deals.

Zach:
So we crank the volume. It’s, it’s, it’s a needle in a haystack, most deals don’t pencil. And we probably, this could be an exaggeration cause I don’t have any data to support this, but I feel like we might lose more deals than anybody, you know, because we’re just constantly tour. I’m constantly touring deals. Bitcoin is constantly underwriting deals, Kayley, our director of asset, management’s constantly shopping comps so that we can dial on our underwriting and we’re always making offers. So, okay. So we, we just crank the volume with the offers. And, and we do compete on marketed deals constantly. It’s just that they get bit up, you know, through the best and final process. And we have a very conservative stress test built into our underwriting model, which we will not compromise those conservative assumptions. Okay. So like we’ll max out our price with our conservative stress test in place.

Zach:
And for the marketed deals, it’s tough for us to win those because you have, you have private equity companies, institutional groups, like I said, that have a lower cost of capital, meaning that they only need, you know, five or 6% cash flow. And we need to get 8% cash flow because we’re serving what we call retail investors, the everyday investor, you know, W2 workers. We have a hundred to 200 plus investors in every single deal. And most of ’em are coming in at 50 to a hundred K. Okay. So we have to get superior returns to a lot of other bigger groups. And to kinda give you some context, Charles, I mean, like if you go into a co-star report and near the end, it will show you the top buyers in a market for the last two years. So right now we’re a top 20 buyer in Phoenix.

Zach:
The last two years in about two months after we close, we have in our contract, we have 130 500 contract. We’ll be top 10. We’re gonna be right there with Blackstone, Goldman Sachs life insurance companies. And so we kinda see ourselves as like the local, like the local gritty underdog. Who’s really just trying to leverage our relationships. We act very quickly. We jump on deals and, and make it work. So, and sorry, this is longwinded. I’ll give you one more. That’s fine. Then I’ll let you answer the last, the next question. But to, to give you an example, like we had a deal earlier this year, it was a 28 million deal. I get a call from a broker and said, Hey, I have this deal. It’s completely off market. You’re the only one I’m showing it to. I think they might be shopping it to a couple other brokers.

Zach:
And so within 24 hours of us getting the phone call, we toured the deal. We shopped all the comps. We completely underwrote the deal. We finalized our operating budget with our property management company. And then we had a, an offer submitted and accepted within 24 hours. Wow. There were two other brokers that brought two other groups. One group was outta California. One was in Canada. They didn’t even have a chance to even come tour the deal before we already had the deal under LOI. And it was kind of funny cuz a few, a few days later we heard from, from the broker like, Hey, they actually got another offer and we didn’t have another contract yet. Right. We were negotiating the contract. We had under LOI and they said, Hey, we, they got another offer from that California group, like 500 K more than what you guys offered, but they said they already awarded you the deal. And they wanna honor that. So, so we got the deal. I mean, so it is things like that where we’re, we’re local. We, we have, we have such a presence now in the market. We know these submarkets extremely well, we’re constantly underwriting deals. And so, you know, there is something to be said for local relationships, local presence, and just ping on these deals quickly and executing and that’s kind of where we, or we’ve seen, seen our advantage.

Charles:
Yeah. That’s awesome. I mean, that’s great. A great reason for why you’re winning so many deals in Phoenix cuz you guys are local. I really want to go back a little bit. You were talking about stress testing, which is something which I, I love and when I’m looking at underwriting and I love to calculate myself, I’m looking at deals. So you know, multifamily is a really hot class right now. How has your company like edited their underwriting or how do they check their underwriting or how do they protect against a pullback by stress testing and explain kind of how your stress testing in a nutshell is, is it like percentage of people paying rent or how, how you guys do it?

Zach:
Yeah. Good question. So, so what we’re doing is in the model, we’re assuming that right after we buy the deal, there’s gonna be some type of significant economic downturn or recession where the stabilized annual rent growth is gonna decrease significantly immediately and that the vacancy is gonna increase significantly. Okay. So in our model, we’re underwriting 4% stabilized, annual rent growth years, one through five organic rent growth to give you some, some reference or some context, Charles real page analytics, which is very credible data source for multifamily. They just announced the July trailing 12 for Phoenix rent growth, organic rent growth for the 12 months proceeding, July, 2021 was 21.6% organic rank growth. Okay. In 20 18, 20 19, we were 8% year over year in Phoenix. Which was number one in the country, 2020, depending where you look, it was at least 10 to 15% organic rank growth through the heart of COVID.

Zach:
It has not dropped below 6% year over year in the 10 year cycle. And you know, the bureau of us bureau of labor statistics announced the trailing 12 months of May, 2021, that us inflation was 5.4%. Okay. So the last couple years we had been telling investors, you know, we’re underwriting, annualized annual stabilized rent, barely above the rate of inflation. Now we’re underwriting it below the rate of inflation, you know, and significantly below the actual rent growth in the market. Okay. So for, for rents to drop anywhere from, from rents to go from anywhere from 10 to 21% and immediately drop down to 4% and stay there for five years, you would have to have a significant collapse. I, I, I would say a black Swan event like a pandemic, but we saw significant growth during the pandemic. You know, it almost had to be a war or something like that.

Zach:
And then in addition to that in year one, depending on the deal, we’re typically between 17 to 23% economic vacancy economic meaning it’s a combination of physical vacancy plus loss, to least bad debt, delinquency, et cetera, which is extremely conservative in year two, depending on the deal, we’re typically be somewhere between 12 to 18% economic vacancy, because we’re assuming it’s gonna take us 24 months to burn off loss, to lease meaning that we’re taking the, there there’s units at the property that are already below market. You don’t have to renovate them that once those leases expire, you know, we’re increasing rents eight to 10% simply because the seller has not kept up with the market. So we’re, we’re, we’re saying we’re gonna burn off loss to lease over a 24 month period to penetrate the entire rent rule. And then in addition to that, renovate to achieve the additional increase.

Zach:
So that gives you an idea year one and two economic vacancy, and then our stabilized economic vacancy assumption for years, 3, 4, 5 is 9% economic vacancy to give you some, some context, Freddie Mac, you know, the agency lender, they are underwriting stabilized economic vacancy in Phoenix at 7% economic vacancy. You know, so we’re 200 basis points, more conservative than Freddie Mac in that regard. And B Ron he’s. Our CFO does all of our underwriting. He did an in place rent analysis recently, the trailing 12 months for our portfolio of April, 2021, going back through the heart of COVID our economic vacancy across our entire P OYO was five and a half to 6%. And that’s while we were doing renovations, you know what I mean? And that’s in year one for a lot of these deals. And so, so those are some of those are just some of the, those are some of the, the examples.

Zach:
I mean obviously you wanna always have exit cap expansion, right? So we’re always assuming at least, you know, depending on the deals, 75 to 200 is points expansion in our exit cap, from what we buy it at over a five year model. So we’re assuming that we’re gonna sell the deal in a much less favorable economic climate than we bought the deal. And we use CoStar data, which has forward looking cap rate projections. You know, we’re always, we’re, we’re always underwriting our exit cap, our year five exit cap higher than what star is projecting cost star projecting Phoenix Metro to be at four and a half cap in five years. It’s currently, this is currently a four to sub four cap market. You’re seeing deals now trade at recaps. And so there’s just a couple examples, you know, where, where we have those conservative assumptions.

Zach:
And then one of the things that you can really do to manipulate and under right model and some sponsors do this is that you can have aggressive pro former rents. Okay. If your pro former renter are meaning that your post renovation rents are higher than they should be, you can really Jack up that cash flow and in your, your equity multiple, right. Which can be very deceiving. And so what we do is we personally secret shop a, all of the comps for every single offer we make, okay, it’s a ton of work, but you have to do it. Meaning we take within a one to three mile radius. We take all the comparable properties that are similar size, similar vintage, and most importantly have a similar renovated interior finish to what we’re gonna renovate to. And we say, okay, we, and we go in there, we shop and we say, okay, there, this is the price per square foot.

Zach:
These are the fees they’re charging. These are their finishes, these are their amenities. And then when we’re, when we’re projecting what our post renovation rents are gonna be, we’re always in the middle of the pack or below the entire body of the comps so that we know that we can hit our proforma rents and perform. So to kind of give you an idea, Charles, I mean, we, we now do all the construction management in house. Okay. We don’t rely on the, on property management company. You know, we source all our materials directly wholesale, so we control the supply chain. And so give you an idea in the last 90 days alone, we’ve renovated, leased up and moved in over a hundred plus units across the portfolio doing that same finish. I just told you, every single unit has at least met and or exceeded our projected rent.

Zach:
Most of them have exceeded it, but it just goes to, it goes, it’s just a, it’s a matter of conservatively underwriting on the front end, your proforma rents, and really shopping the comps and making sure, Hey, these rents are already being achieved in the market. We’re not reinventing the wheel, right? If we get it to this finish, it’s already proof of concept in the market. We’re gonna hit it. So that those are just some examples of our conservative underwriting and the stress test. And you had one other question Charles will touch base on typically depending on the deal in year one, our, our physical break even occupancy is typically anywhere from 60 to 70% physical vacancy in year one. So these deals are cash flowing day one covering the debt service, meaning, you know, for us to not be able to cover the mortgage or cover the debt service without doing anything, right.

Zach:
Just buy them. Don’t do any renovations. You know, we’d have to drop below 70 to 60% of occupancy. Even then we raise operational reserves, which could float us for a few months, even if we were to drop below that, you know, to cover the debt service. And so those are some of the examples. And then that break even starts to quickly decrease, heres 2, 3, 4, 5, as we’re renovating units, increasing rents and increasing NOI. You know, our break even number starts to decrease significantly. So, you know, in, in Phoenix, if your property is below 95% physical occupancy, it’s either cuz you’re intentionally doing heavy renovations or you just don’t know what you’re doing. Know there’s, there’s not enough workforce housing for all the people coming here. You know, it’s just crazy. And so everything is at least 9 95 to a hundred percent physically occupied. So to drop below 70, you have a serious issue at, at the property. So that, that just kinda gives you an idea of, of some of the conservative assumptions that protect our investors.

Charles:
Yeah. That’s very conservative. I I’ve seen some groups that I look at their stuff and it’s, it goes down into the seventies, which I feel is pretty conservative when you’re going down into the sixties. I mean, it’s chances are, you’re gonna lose 20% of the people paying rent. I mean, that didn’t even happen during COVID for the, before all the money came out. I mean, so it’s just like it’s yeah. It’s, it’s pretty, that’s, that’s a very good way of doing it. So I had a couple questions here in regards to your growth, because I mean over the last two or three years, you guys have really grown. I mean, what suggestions do you have for a company in regards to building a successful team? Like how did you build your team? How did you meet your partners? Cause I feel with this type of growth, people are interested in that.

Zach:
No, it’s a great question. Yeah. So I mean, it was a grind. I mean, honestly, like I said, it took me 14 months to even close the first deal. And I had quote, unquote dated, you know, seven or eight different business partners, you know, that you meet, you guys are of the same goals. You wanna go do multifamily and then you start working together, underwriting deals making offers and you realize, okay, this person doesn’t communicate with me enough or is not as committed. This person doesn’t work hard enough. This person, I really like, we have a nightly phone call. We have the same skillset. And so we’re like, we have a weakness that’s not being fulfilled. And so, you know, I had to cut people like that, you know, and it just said, Hey, we’re not helping each other really. So it’s really a matter of finding complimentary skill sets.

Zach:
You have to identify, I mean, no matter how talented or smart you are, you cannot, if you wanna really scale, you cannot fulfill all of the roles and responsibilities that they it’s it’s you have to run in my opinion, like a real company, you know, a lot of people wanna, the problem is I, I think there’s like this overarching idea that being a syndicator is like passive and like financial freedom and all this stuff. And it’s honestly BS because it’s a lot of work. It’s a ton. If you wanna be a passive investor, yes, you can achieve that. But if you wanna be the opera rate of the sponsor, it’s a ton of work to, to effectively operate these deals and continue to scale and continue to do deals. And so you need to identify, okay, what are my strengths and my interests? You know, do you want to be the acquisitions guy?

Zach:
Who’s managing the relationships, finding the deals, raising capital, are you more of an analytical person who wants to do the under the financial analysis, et cetera, find out what is your strength and your interest. And then you need to partner with somebody whose strength is your weakness, so that you have complimentary skill sets. So that’s what we’ve found. You know, we’ve been fortunate with Robert and B Ron to find that where we all have really been able to compliment each other and there’s no ego. We all have the same goal. We’re all working really hard then. And then the first couple years, Charles, we made no money. You know, it’s tough. You know, we, we put all, I put all my money into the deal. So I had skin in the game and then you’re broke. So it’s like staying above water for a while.

Zach:
And then you have to just keep kind of grinding it out. And, and then once you, you know, sell a deal or two and you start to execute in the business plan, you start getting cash flow. Well, that helps a lot. Okay. And so once you can start to once you can start to generate like asset management fees or acquisition fees, that’s the lifeblood of our company. That’s the liquidity, right? So we take an acquisition fee and an asset management fee on every deal. We haven’t touched any of those fees personally, since we started. Okay. Those are basic. When we get an acquisition fee, it’s going into the company capital account, it covers our payroll for all of our employees, our office lease our investor portal. We have subscriptions to HubSpot real page, all these marketing analytics things. So it covers the payroll and then it, it basically gets recycled back out for earn money for another deal.

Zach:
Okay. So you have to really, if you wanna scale, I guess this is just my opinion, right? This is how we’ve done it. There’s OB obviously different ways to skin a cat, so to speak. But the way we’ve been able to scale is we’ve treated it like an actual business. Last year, we converted it to an S Corp. So because we have these fees and we have liquidity, all of us are taking salaries. You know, all 10 of our employees have full benefits. They have w two salaries. So you have a sense of a real company where I’m at the office right now. We’re all here at our office, 50, 60 hours a week, you know, just grinding away to make sure that we’re executing. And so it takes time. It starts out with having the right one or two partners and then figuring out how to execute on acquiring a deal, operating a deal, making it perform.

Zach:
And then as you start to perform, you’re gonna get more momentum, being able to being able to raise equity. Okay. So what we’ve seen is a, a massive influx of referrals from our, our previous investors and our current investors. We’re doing monthly cash distributions. You know, we’ve never missed a distribution. So the first week of every month, they get a direct deposit. ACH hits their account, you know, for every single deal every single month. Well investors after a while, really appreciate that. They start to refer their colleagues, you know, their, their professional colleagues, their friends and family, whatever. And so then you start to get that momentum with raising equity. And you’re like, okay, now we know how to source deals. We know how to underwrite deals. We have the equity to acquire them. We know how to operate them. Okay. We can, we can fulfill all the roles now.

Zach:
And then it’s about building out the infrastructure. Okay. So then it’s about hiring the staff because you’re gonna, because you’re just gonna get overrun with so much work, right. And it’s, it’s still a grind, but we’re, we’re excited. We like doing it. And so now we’ve been fortunate to, to be able to take that, that revenue and build out the company and build out a real infrastructure to where we can, you know, do all of our construction management, asset management in house, you know, in the next 30 to 60 days, we’re starting our own construction company where we’ll actually employ all of the skilled labor and control the time and labor. You know, we, we are now sourcing all the materials, like I said, directly wholesale. So we make our vendors, use our materials so that they, so that they can’t run up the costs and blame it on inflation.

Zach:
So we control the supply chain. And so just gradually trying to see how can we, we improve, but it comes down to finding the right partners, identifying you or strengths. And then just take it one step at a time. And I think too many people, including me in the beginning, you wanna start out buying a hundred plus unit deal and you say, I’m gonna do, I want economies of scale. I want a big deal. And then you realize how hard and overwhelming it is and you get discouraged. I did the same thing. You just need to get that first deal at all costs. It doesn’t matter if it’s a five unit deal. It 10 unit deal. Our first deal was 36 units. You need to get that first deal at all costs. And then the momentum will continue to roll from there.

Charles:
Yeah, no, that’s great. Yeah. with your own construction company, you can obviously keep an eye on costs and but you also are gonna have more control, which is which is great for you and your investors. So what are some mistakes that you see other real estate investors make?

Zach:
Yeah, I mean, it’s tough. It’s, it’s funny. Cause I’ve been talking to so many investors recently and they’re just talking about how their passive investments like in the Dallas area and markets of Texas just are not performing. So it’s hard. I mean, there’s just, you have to vet sponsors, you have to do your own research on markets. You have to be aware of things like everybody two years ago was so hyped on DFW in Texas, but they don’t realize that the, the real estate property taxes and the insurance costs make it so difficult to underwrite a deal. And now there’s just not a lot of growth and I’m, I’m not trying to pick on Texas. It’s just an example that immediately came to mind. Cause we were just talking to an investor this morning. And so I, I, I think, you know, as a past investor, you need to really try to vet the sponsor and, and vet the market.

Zach:
And I think that with the, so in the social media age, you know, it’s, everybody’s labeled as an expert, you do one deal. Everybody thinks you’re an expert. You need to ask, you need to ask tough questions and be people and say, okay, what have you actually done? How do you handle this? What are your operations? I know there’s a lot of people that are doing deals in markets that they don’t live in, which I’m not saying you can’t do, you can be very successful, but you need to understand, okay, what are their, what’s their presence in that market? Do they have somebody who’s boots, something or around like, what are they doing to handle any issues? And so I think there’s, there’s a lot of things. I mean, as a, as a sponsor, and you’re trying to do your first deal as an active investor, it’s just tough.

Zach:
You don’t know what you don’t know. Right. And so I think you need to try to do that first deal and you try to learn as much as you can, but at some point you have to, you just have to take that leap and it’s gonna be very, very scary and you’re gonna have a lot of fear and anxiety, you know, and I still get a lot of anxiety and fear from doing big deals, but you have to take that leap and just learn along the way and, and quickly adapt. So, I mean, I think you have to just, you have to kind of go through it and be willing to learn as you go and, and listen to listen to other people and gain as much advice as you can.

Charles:
You nice. What do you think are the main factors that have contributed to your success?

Zach:
Yeah, I think it’s just finding the right partners. I think it’s just staying resilient and focused. I mean, I, there was several times where I wanted to quit. You know, I went from making, you know, or 200 K a year to being broke very quickly, you know, burning through a cat. And then the 14 months I could have easily quit and I mentally and psychologically did quit several times, but then I was like, you know what, I’m gonna go back to this and stay focused. So I think you have to just keep pushing through. Okay. So I think you have to be, you have to stay determined and, and just keep grinding and cranking the volume and you have to believe that you can actually do it. And, and don’t worry about what other people are doing. Like you can’t get caught up in like the competition, cuz you’re really only competing against yourself in your own mindset. So I think just, I think the biggest thing for me is just staying focused. And even now that we’ve been fortunate to grow, it’s staying humble, hungry and focused. You know, you can’t get complacent and think, oh, you know, we’re the man now, like we’re buying deals. No, it’s like, how are you gonna grow going forward? How are you gonna keep improving and stay focused, stay hungry. So I think it’s just constantly staying in attack mode and, and trying to stay focused is the biggest thing.

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

Zach:
Yeah. Thanks so much, Charles. And listeners can go to our website rise 48 equity.com. It’s R I S E the number’s 48 equity.com. You can email me Zach Z ACH rise, equity.com. And, and on the website, you can actually set up a call with me. So if you go to the website, you can set up a call on, on my calendar and I’m happy to, to speak to anybody who’s interested in learning about our opportunities or they’re just, you know, need some advice and wanna learn about how to get into it. I’m always happy. And if anybody’s looking at the Phoenix market, I always tell everybody, you know, I’m a resource to refer you, brokers, property managers, attorneys, insurance, whatever you may need, you know, I’m happy to share re cause I know it’s really tough to get started and just having the people can really help. So yeah, go to the website or email me.

Charles:
That’s awesome. Zach, thank you so much. For listeners, we’ll love that for being able to reach out to you to bounce ideas and get some referrals. And thank you so much for coming on today and looking forward to connecting with you in the near future.

Zach:
Yeah. Thanks so much, Charles. Really appreciate you having me on man. And, and thanks so much.

Charles:
Have a great rest of your week. Talk to you soon.

Zach:
Thank you.

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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Links and Contact Information Mentioned In The Episode:

Rise48 Equity

About Zach Haptonstall

Zach Haptonstall is the CEO and Co-Founder of Rise48 Equity in Phoenix. He is also an official member of the Forbes Real Estate Council, and a #1 Best Selling Co-Author.

Zach was born and raised in Phoenix and graduated Summa Cum Laude from the Walter Cronkite School of Journalism at Arizona State University. He is a former live television news anchor and sports reporter for Arizona PBS and co-hosted a show on Fox Sports Network Arizona.

He went on to earn his MBA from Grand Canyon University and became part-owner of a healthcare company after years grinding it out in healthcare sales.

Searching for a way to gain back control of his time and achieve passive cash flow, Zach discovered Multifamily Investing and closed his first deal in 2019. Today, his company Rise48 Equity has a portfolio totaling over $143 Million of Assets Under Management in the Phoenix Metro.

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