GI165: Serving as a Pastor to Investing in Real Estate with Ellis Hammond

GI165: Serving as a Pastor to Investing in Real Estate with Ellis Hammond

Ellis Hammond started his career as a missionary on the college campuses of San Diego. His investing journey began in 2018 with a duplex and nine months later Ellis co-GP’d on a 144-unit complex in Memphis, TN.

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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:
Do you have money sitting in the stock market? And you’re worried about it or worse. You have money sitting at the bank, not keeping up with inflation. My name is Charles Carillo, founder and managing partner of Harborside Partners. And since 2006, I’ve been investing my money and my family’s money into income producing properties. These are real assets, real properties with real addresses that produce real cash flow. At Harborside Partners, we provide passive investors who love real estate with a turnkey investing solution. If you want to put your money to work in real estate, but can’t find deals, don’t have the time to get funding in. The last thing that productive people want to do is manage real estate. We find the deals. We fund the deals and we manage the tenants, the termites and the properties. Partner with us at investwithharborside.com. That’s investwithharborside.com. Go to investwithharborside.com. If you love real estate, you like the idea of passive income and believe that income producing properties will appreciate over time. Go to investwithharborside.com. That’s investwithharborside.com.

Charles:
Welcome to another episode of the Global Investors Podcast; I’m your host Charles Carillo. Today we have Ellis Hammond. Ellis started his career as a missionary on the college campuses of San Diego. His investing journey began in 2018 with a duplex and nine months later Ellis co-GP’d on a 144-unit complex in Memphis, TN. So thank you so much for being on the show there, Elli.

Ellis:
Hey, yeah, I’ve come a long way since then too, man. But that was the beginning of the journey and glad to be here.

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

Ellis:
Yeah. You heard in my, I think I was actually a pastor and missionary for six years and and kind of full time vocational ministry. My faith has always been a really important part of, I shouldn’t say always, but it became an important part of who I am in my life in college. And so I wanted to help young guys like myself, just begin to find a bigger purpose and, and reason for doing things. And so we moved to San Diego to kind of build our college ministry and never thought I would do anything different, man. I loved it. I love, I love I love, you know, I love, I love vocational ministry. I love getting to just kind of interact with people on a day, day basis. But I think during that journey, I also, you know, learned a couple things about the need for capital, the need for vehicles that can produce and create wealth and also learn that I I’m an entrepreneur at heart. And so those kind of worlds came together in real estate.

Charles:
Awesome. So tell us about your your first real estate investment and you, what you did and how that turned out.

Ellis:
Our first deal was at duplex man, and I had no idea what we were doing. I mean, <laugh>,

Ellis:
You know, I literally hadn’t didn’t even know you could buy real estate. I just, it was not even in my framework. And I went to this seminar that I heard on the radio, cuz like I just was so hungry to figure out how do we build wealth? And I went to this two hour seminar that I heard on the radio and I just saw these guys buying deals. And I was like, okay, well these idiots can do it. Like <laugh> I gotta be able to figure it out. And no, I’m joking by the way I was the idiot and but I did figure it out. It took me four months to buy our first duplex and I found a mentor in San Diego who owned deals and that’s always been the case, man. I always just tell everybody that, like, if you wanna accelerate your path, go find a mentor, spend the money for a mentor.

Ellis:
And, and do like at every level, like not just in the beginning, like where I’m at now, you know, we’re buying, you know, 20, 40, 50 million deals. Like I need mentors, I need people who can help me accelerate this journey. I don’t wanna, you know, we talk about what’s given us success it’s because like we pay for speed <laugh> yeah. And so yeah, it was a duplex, my wife and I purchased, we actually had a family investor on that deal to help us with the down payment and we did everything, man. I got all my college students involved in my ministry to come to that place and help me with the tear down the yard, the renovations, you know, and had no money. So I would pay them all in pizza. And that’s what we did, man. That’s what we did. And we created more equity in that deal in 11 months and we had made in three years.

Charles:
Nice. That’s that’s fantastic. So shortly after that first duplex deal, you syndicated a property. Yeah. And tell us a little bit about that, how you found the deal, what happened you know, what, what your role in the deal was?

Ellis:
Yeah, I was a partner mostly on the equity side, you know I again found someone who had experience, someone who knew this business really well, who own a couple thousand units and just figured out ways to bring value. And you know, one of those ways was kind of leveraging my network of, of at that point were kind of donors and friends to become investors in that project. And so that was really how I kind of got started in this space, which maybe a lot of people do either you find the deal or you have the money, you know, like that’s really what this business comes down to. And so that kind of introduced us to the world of commercial real estate multi-family and you know, really beginning to kind of leverage other people’s money to go and buy bigger deals and leveraging other people’s experience.

Ellis:
Mm-Hmm <affirmative> so those, you know, those were very important lessons for me early on, is that, wow. Okay. I can leverage someone’s experience and I can leverage other people’s money to go be a part of something that is an incredible wealth builder can accelerate our wealth building journey. And I don’t have to be at the property all the time and get all my college buddies to to do everything cuz there’s more margin, you know, there, there was more and even though I was a minority owner, the margin of that deal is just so much more significant cuz it’s bigger. And I think that was a very important lesson is when I kind of stopped the whole duplex route and realized if I can just figure out how to buy a hundred plus units every time. Even if I’m not the whole owner of that deal, this is how we accelerate our wealth, our wealth billing journey.

Charles:
So what is your current investment criteria and strategy when you’re investing today

Ellis:
We, or strictly buying multi-family assets and, and great markets where rents are going up, you know, to oversimplify it. I mean, we’re, you know, we’re, I wouldn’t say we’re heavy value add operators, but you know, we make money by raising rent. So we gotta figure out how to, how to do that in markets. Right? So we like Kansas city, we like Dallas and Dallas right now actually torn assets. So, you know, I, I, I really wanna buy good deals, man. I wanna buy, I wanna buy good deals that we can hold onto if we, if we need to hold, hold onto them. So I, why I’m here. I like, I like seeing, I like being on the properties because you just get a feel. And so anyways, we’re buying larger multi-family assets 20 to 40 million is kind of our price range right now, really because it’s kind of based on the equity that we have, you know, if we could go buy a hundred or 200 million a multi-family at a time, I would, I could go find those deals. So if there’s my listening that wants to partner with me and go buy some really big deals, please hit me up. But that’s about our criteria, cuz that’s kind of where we’re at in terms of in terms of equity and then also, you know, some ways you kind of have to show, you can close this before you can go close kind of the next level. And so that’s where we’re at. Right.

Charles:
Nice. So how did you put together your team that you’re, that you partner with on deals?

Ellis:
Guys that are just smarter than me and have what I don’t, you know, have, I mean we have, two of my partners are really good analyst and kind of operationally experienced. One of my partners has been about a decade in mobile home parks and other one’s been in lending. And so those, you know, those are, those are those make great teammates in this business, you know, because I’m very much kind of CEO S visionary decision maker, but really, you know, you need someone who’s really strong operationally. Someone who’s can build systems and processes and then someone who’s really good at, you know, putting together a capital stack and making sure that we’re not losing money, you know, or money’s not dripping out of the business or out of our assets. And so those, the, I just honestly found, you know, early on man, we were just hustling and, and showing up everywhere to meet people, kind of, I kind of began to see, you know, you, especially, we lived in San Diego and so I would just begin to see kind of the same people and over and over and became friends with a lot of these folks.

Ellis:
And three of them specifically were who are now my partners because they were as hungry as I was. They they’re, they lived their life with a sense of urgency like I do. And that really stuck out to me. And so when I said, Hey, I wanna go buy bigger deals. They’re like, yeah, me too. I’m like, well, let’s go do that together. And so that’s how we started it.

Charles:
Nice. So how did you make the transition from having a job to full-time in real estate?

Ellis:
I just left <laugh>. Oh, <laugh> just honestly I mean, I didn’t say I left, like, it took me about a year to transition in the sense of, I not for my sake, for my team’s sake. Cause we were building a ministry, I had a staff team, we had a ministry and so it, I had to kind of get to a place where they were ready and prepared for me to be able to leave and step out. But from a financial standpoint, dude, I just left. I mean, I, I really didn’t have it figured out. I thought I had it figured out, but then I didn’t. And so but it was the best thing for me because you know, it got me really serious on how do we go and how do we go and make an offer? How do we go and build a business?

Ellis:
How do we create income coming in? So I don’t recommend that to everyone, but you know, this is like multi-family real estate, especially buying big deals. This is not a side hustle. And all these guys trying to syndicate deals outta the side hustle is probably why they’re not growing very fast because you just, it’s hard, man. And everyone you’re competing with in this market today is not only full time. They got thousands of units under the belt. They’ve been doing this for a decade and you’re trying to do this in a four hour window. It’s like, gimme a break. You know what I mean? And so yeah, to answer your question, I just said, I’m gonna, we’re gonna, we’re gonna go, we’re gonna commit to this and we’re gonna really figure this out. And truly did not have a, a secondary income stream.

Ellis:
We created a, kind of a coaching education platform for faith driven investors like myself called kingdom Maria to kind of teach the business as we were learning it. And, and that was essentially the platform that gave us life for the first year in terms of, in terms of just being able to survive. And it’s been an amazing community that we’ve built now that I really rely on. And some of my best friends are in that. Now my, some of my partners on deals, equity come from kingdom MariaI and so kind of started as, Hey, I, I need to have an offer <laugh> so I can, you know, survive and live and it’s just grown and become something like a very inva, like a incredibly valuable community, not just for me, but for the, you know, 40 or 50 people that are now involved in that.

Charles:
Nice. So what are some limiting beliefs that you had to battle and overcome to be successful in real estate investing

Ellis:
Still battling overcoming limiting beliefs? I was just talking about this the other day. I think the thing that I see the most and for me too, is that most people think they have to grow incrementally. So I buy du, I buy duplex and then I buy an APL and then maybe I buy another APL and then I buy, you know, I can go bigger and go. It’s like, I gotta incrementally grow my way there. And there’s some truth to that in the sense that like, if you’re at a closing table and you’ve never closed a hundred million dollar deal, it’s gonna be really hard to convince that broker to sell you that a hundred million dollar deal. However, I think we’ve been trained to think incrementally, you know, schools kind of ingrain that into maybe our parents, the way we’ve seen them build their wealth has been incrementally the most.

Ellis:
Like that’s just not, I just think that’s a very limiting belief. Like, yeah, I think there’s no such thing as an overnight success, but really successful people like look at their track record or look at their progress. Like it’s not incrementally, it’s, it’s long, steady, hard work for a long time and then exponential growth, right. And that’s, that’s be, and it’s because you spend all this time building skills, building skills, building relationships, building relationships, but then you, all of a sudden you can begin to apply that into a vehicle that can really help the exponential growth. So I think for real estate investor listening, it’s like stop thinking. You have to incrementally grow when, you know, if you had the right resources and the right connections and maybe with the right focus, exponential growth is possible. Like, I mean, dude, I was a pastor three and a half years ago and now I’m best in final on a 40 million multi-family deal.

Ellis:
My only network was college students three and a half years ago, 18, 19 year olds. Literally my only network was people who had no money and now we have resources and, and connections to go buy a hundred million dollars in real estate this year. Like that’s exponential, man. You know what I’m saying? And so if I was still buying duplexes or had the idea that, oh, I gotta go buy duplex and maybe learn this for five years, then I could go do this, but never, never be where we’re at today. And so I think that was something I just had to overcome is like, you know, the, the idea that that I didn’t have to wait on someone to give me permission to go and compete with the big dogs I am the dog, you know, like that’s kind of, that’s kind of the, my mindset now.

Ellis:
And and I think, I think I see that a lot, especially in real estate investors, because to be honest with with your audience real estate investors are not really great entrepreneurs. I mean, that’s why they’re in real estate, cuz if they were really entrepreneurial, we’d probably be building other companies who have already built other companies or real estate. It’s kind of like that last frontier for people who wanna build wealth and aren’t really happy with their jobs. So they get into real estate. And so I think for that kind of person, who’s really probably not a great entrepreneur. They’re only used to kind of thinking incrementally and great entrepreneurs think exponentially. And so I think that’s a mindset we all have to battle and overcome.

Charles:
Interesting. So other than thinking incrementally, what do you think are some other mistakes that you’ve seen real estate investors make?

Ellis:
I think buying BA I think I say buying bad deals, like thinking, I think everyone, especially young investors wanna go get the off market or the cheap deals because they’re lower. I don’t know. Maybe they’re easier to get under contract or you have to raise less money or you feel like you’re getting a discount and I just think it’s a bad movement because you get what you pay for and that’s in every arena. And so I think, I think right now I think it’s a much better idea to go buy upstream, meaning go buy nicer quality assets and look for competition. Like, yeah. I mean, I just sit, you know, in an office be like, I don’t like to compete. I’m like, I kind of like it only because I know if I win that deal, I own something that everybody else wants the problem with buying off market or buying these low deals is cool.

Ellis:
You got the deal, no one wants it. <Laugh> like great dude, you own an asset that maybe you don’t even, you don’t, you have no idea how many other people people want it. So I think that’s a big mistake. Early investors are looking for a discount. They’re looking for something cheap to get ’em in without really seeing the big picture of, of the value of the asset, the value of the market. And so, you know, look for competition and then go figure out how do you set yourself apart from that competition or, you know, make enough offers and be at enough closing tables to finally get a deal it’s worth. I think that’s worth the hard work of buying good quality stuff. That’s much easier to manage and owning a few of those deals than owning a bunch of stuff that is gonna kind of make you some money and is an absolute pain and you know what to manage.

Charles:
Yeah. And they’re looking at the performance from the brokers and they’re looking at the high cash on cash you know, income that their returns are gonna happen, that they think that are gonna happen and all that stuff. And that’s how they’re choosing those properties, but they’ve never sat in that management seat. And when you sit in that management seat of let’s say subprime assets that’s when you realize that wow, this is, this is, I’ve got myself on something now, but what do you think are some of the main factors have contribute to your success?

Ellis:
Amount of my faith has been a huge part of my journey. Just, I, I believe a massive belief in God, a massive belief in what he’s called me to and I have I’m just rooted in that, man. I think that gives me, I think that makes me really dangerous because I think most people are looking for someone else to give them like approval they’re Hey, I, I need to go do this to, to kind of get the approval or, or whatever, where, where I’m really secure. I, my faith is a huge part of my life. And so I think that’s just make me, it’s made me very bold and to go try things that maybe other people aren’t because they have a huge fear of failure and I I’m just okay with failure. <Laugh> like, I’m okay. Yeah, sit down. I’ll give you a great example, man.

Ellis:
We, you know, we made this huge offer on this deal. We didn’t win it. And then we definitely shut our inexperience, but like I sat down with the broker yesterday and he was telling me, I’m like, just shoot me straight, dude. Just tell me what I did wrong. And he just had a whole list of stuff and I’m like, okay, great, thanks. Now I know, you know what I mean? Like, and it was just so good and honest. I’m like, all right, well now I couldn’t have learned that any other way, except just going and doing it. And so, you know, that that’s been huge and I think you know, just speed man. And the way that I, you know, the way to get speed or access to mentors, to partners to resources is to pay for it. And so I spent a hundred thousand, I spent six figures on personal development on access to masterminds events last year, just because I wanted access to people like six figures is a, still a huge number for me.

Ellis:
Right. But like, so most people, why don’t you go put that into your real estate deal or put that into something else it’s like, because the best investment I have is me and my network. It’s actually not the real estate deals I’m buying, even though they’re great assets, but the way that I’m really gonna build wealth, me personally is me. Like, it’s me, the entrepreneur, it’s me, the CEO, it’s me, the connector. And so I’ve just paid for access to people and, you know, busy, successful people are also busy and the really only way to truly get access to those folks is either be a badass yourself, you know, where they wanna hang out with you or pay for their time. And I’m okay at this point in my life paying for people’s time.

Charles:
Interesting. So H and our listeners learn more about you and your business.

Ellis:
I mean, if, if you want to <laugh> I, but seriously, I mean, we’re, you know, we’re looking for partners for sure in great markets who wanna buy good, good deals, you know, especially the Texas markets. We’re, we’ve bought in da we wanna buy in Dallas, but we’ve bought in Houston, Austin, Kansas city like the Carolinas I said Kansas city already. So, you know, a couple things, if, if you’re a deal, if you’re a deal junkie like us and you, you are really good at finding opportunities, maybe, maybe there’s a way to partner. Or if you’re, you’re, you know, you’re an equity person, you can raise money or you have money and you wanna get into deals, you know, may, there’s definitely a way for us to partner there too. We’re, we’re definitely gonna, we’re definitely finding deals to help put capital to work.

Ellis:
So the best place is to go to symphony capital group.com, symphony capital group.com. And we have a contact form there to just reach out and say that, you know, you heard me on this show and would love to touch base. I’ll see that and get in touch with you. So that’s symphony capital group.com. I have a ton of stuff on the internet man. People can go to, but my YouTube page, you know, just look me up on, look me up Ellis Hammond on YouTube and Twitter. I actually it’s a good place to kind of follow my <laugh>. My thoughts. And usings is on Twitter, Ellis Hammond underscore or Ellis underscore Hammond, and would love to would love to connect with people there, but symphony capital group.com. That’s the name of our company that we’re buying deals in. And you know, it takes a village man to, to go and build something big. I know I can’t do this on my own. And so I’m always looking to connect with likeminded people who really wanna build something together. And that’s investors that steal people, you know that’s that’s, that can be all that can be all kind of stuff.

Charles:
Okay. Well, thanks so much for coming on today. Look forward to connecting with you face to face sometime in the near future and have a great rest of your week.

Ellis:
You too. Thank you.

Charles:
Talk you soon. Bye-Bye

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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Announcer:
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About Ellis Hammond

Ellis is the founder of Kingdom REI. He started his career as a missionary on the college campuses of San Diego. His investing journey began in San Diego in 2018 with a duplex and nine months later Ellis co-GP’d on a 144-unit complex in Memphis, TN.

Today, Ellis is the co-principal of Symphony Capital Group, an investment firm currently focused on acquiring value-add multifamily real estate across the U.S. most recently in San Diego, CA, and Kansas City, MO.

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