GI273: Investing in Multifamily Real Estate with Sean Tagge

GI273: Investing in Multifamily Real Estate with Sean Tagge

Sean Tagge began investing in real estate in 2017 and was involved in over 1500 single-family real estate transactions before transitioning to multifamily investing. His team has acquired 9 multifamily apartment complexes, totaling over 1300 doors, while raising $50 million from limited partner investors.

Watch The Episode Here:

Listen To The Podcast Here:

Transcript:

Charles:
Welcome to another episode of the Global Investors Podcast; I’m your host, Charles Carillo. Today, we have Sean Tagge. He began investing in real estate in 2017 and was involved in over 1500 single-family real estate transactions before transitioning to multifamily investing. His team has acquired 9 multifamily apartment complexes, totaling over 1300 doors, while raising $50 million from limited partner investors. So thanks so much for coming on today, Sean.

Sean:
Yeah. Hey, Charles. Thanks so much for having me on. It’s great to be on with you and yeah, I look forward to diving into whatever, you know, whatever we find.

Charles:
Fantastic. That sounds great. That’s how we do it in the show. So, before we get invested really into what you’re doing now and what your team’s up, can you tell us a little bit about yourself, both personally and professionally of what you did before getting started in real estate?

Sean:
Yeah, sure. Went to the University of Utah did biomedical engineering, bachelor’s of science, then worked at a hospital under some physicians doing artificial heart research and quality control. Did that for about three years, and while I was doing it I bought a duplex and that what really shot me off to getting into real estate. So that’s when I started and quit my full-time job and dove full on full-time into, you know, flipping houses and getting some rentals. Why

Charles:
Did you choose real estate as your investment vehicle back then?

Sean:
So, yeah, I mean, you know, I was just young and you know, of course everyone tells you well, at least where I’m, you know, where I grew up you know, it’s better to own than to rent, right? Like rent is basically thrown your money in the trash, where if you own something, yeah, a little bit goes to interest, but you build equity, you pay down the mortgage. So I always wanted to own a house and, you know, once when I got a job could qualify, I, I just figured that was a great way to start. But then what flipped the switch for me was when I saw a listing with like a mother-in-law apartment, and the realtor told me like, yeah, you can just rent this out, you know, a thousand dollars a month. I was like, oh my gosh, <laugh>. So then I started only looking for duplexes to fourplexes, right? ’cause You know, the four unit thing. And I just, I just mapped it out like an engineer spreadsheeted out. I’m like, wow, I, this thing will pay for itself and I just wanna do real estate. And I saw I was way better than the, what I was getting in the stock market and, you know, in the s and p 500. So it just flipped the switch completely.

Charles:
Before we get into kinda what you’re doing today can you briefly explain how you guys completed 1500 single family transactions? Because when you hear a company doing this many transactions I mean, it really shows that you guys had like an actual team and system to facilitate those properties. So can you give us like a little background to what your team looked like at that point and what your role in the firm was to propel you guys to do that many transactions in such a short period of time?

Sean:
Yeah, so quit engineering job in 2017, and that’s I already before set it up that’s where I met my future partners in Memphis. So from Salt Lake to Memphis. And they, they were already doing pretty good on the flipping end, already had a decent company like the, their dad as a father son do. The dad already had, you know, a lot of rentals. They were just so busy, right? And 17, the market was going nuts, bonkers, and even more years later. So there’s like, we need someone organized and engineer and like, if you’re hungry and ready to do this, which I was talking to people about, I want to get outta engineering and do real estate. They’re like, let’s, let’s, you know, let’s have you come over here, flew over and struck a deal. And so, yeah, then I got, two years later, I made, was made partner and we were doing around 200 to 300.

Sean:
I think we did like 322 was the most in one year. Single family flips, obviously. Like I had, we had three partners, so Jim, Brad, mark, and then me. And yeah, like you said, it’s an operation. Like, oh, I don’t know if a one man band could handle it. If he did, he’d have a lot of c-suite people. But yeah, I mean, we had three renovation managers. They each had like five to 10 different paint crews and, you know, plumber, you know, different than a plumber, electrician, you know, they had all the subs underneath them to renovate a house. And then we had in the heyday, 21, you know, when we’re at full cycle doing 3 22 in that year we had, geez, three, three acquisition managers, two acquisition assistants, seven virtual assistants an office manager, contract manager two sales manager, of course, our partners what else? Two marketing, marketing guys

Charles:
Transaction managers and stuff.

Sean:
Yeah. Then like two, yeah, like two or three bookkeepers. Yeah, it was, it was, you know, it was a fully loaded machine. We were prepped to do 400 deals a year, obviously interest rates let us know, otherwise the fed <laugh>. But yeah, we, we were, we were getting primed up to, to get up into that zone, and we’re just really, we used traction. So a lot of organization, systems, process, stats, data, ’cause you know, you gotta, you gotta be tracking and have data and like weekly knowing where you’re at on everything. So we were watching things pretty decently and things were changing way rapidly from 20 to 21, 22, 23. So, yeah, it was crazy.

Charles:
That’s one thing I find between kinda real businesses and then people maybe that have lifestyle business people is attracting the numbers, like the, and you can do it. It’s much easier on a smaller scale, obviously, when you start, and it can be very straightforward and very it doesn’t have to be as much detailed, but that’s one difference I’ve seen when I speak to much more accomplished business owners that actually have businesses, not just like high paying jobs, is the tracking of the numbers and knowing the numbers. And I mean, when people start throwing that out, when you’re talking to them in, in conversation, you’re like, whoa, wow. They, like, they’ve, they’ve tracked it. They’re like, it’s a whole different level than someone’s like, oh, you know, we do this and we do that for marketing and, you know, you know, the schedule and the appointments are filled up, so everything’s fine, <laugh>, you know? Yeah.

Sean:
I mean, we, we had, you know, every dollar of marketing and each different, like billboards, you know, direct mail, website, S-E-O-P-P-C, this and that. We knew what we’re spending each month, what we’re getting returns on, how many leads, you know, from the top down to the bottom. You know, on the Reno Weekly, the bills were coming in. Our budget’s 25, we’re halfway through the Reno. Are we at 12, 12,500 on the Reno. You know, our average time to flip a house was 95 to a hundred and like 20 days. So three to four months we were, we were turning these out. There’s, they’re small, you know, turnkey properties, so they’re just single family, three bedroom, two bath, 1200 square feet was our bread and butter. Yeah. And yeah, and, and yeah, it came down to that and then had a map, right where, you know, this zip code makes us a better profitability.

Sean:
This one has a higher loss percentage, so maybe we need to you know, or less profit margin. So maybe we need to offer a little bit less and have a better profit margin in this zip code. Like, that’s where we’re starting to get down to. Obviously this didn’t happen at the beginning, <laugh> the beginning. We really, we really like, we’re lucky to know what we were making at the end of the month. So we started just fully onboarding all that stuff, all those numbers and data, which I, I played a big part of as the COO. But then it became nice, ’cause eventually the division leaders kind of were handling those numbers and the virtual assistants were helping, it’s a lot of data entry and gathering, which is nice to have a virtual assistant, you know, 10 bucks an hour or less, just typing in a lot of numbers. And then it helps you though, as a leader and, and your other guys be aware of where you’re at weekly. And so we’d have weekly reports going out, you know just flagging items, you know, if it’s in this zone, you know, it’s, it’s brought up to our attention, things like that.

Charles:
Yeah. We have KPIs for our company, and it’s one of those things that yeah assistant takes care of it. I, I would never wanna do that, but it’s you to kind of set up initially and explain exactly how you wanna do it, and then it’s something that everybody has access to it, and it really shows you, you know, down to you know, cost per lead, cost per whatever acquisition. And you, you, you really know where where you should be putting more money and then you can really turn it up.

Sean:
I would say the power to that too is keeping your data for years. So I kept everything before, like, we didn’t know historical, so like, but like, it’s amazing when you have five years of, you know, how a zip code’s performing for an acquisition marketing, or perhaps a you know, a renovation guy versus another. Like, it, it really, you see some interesting trends and it lets, you know, norms in the market and lets you, so that’s what’s kind of interesting too. So I couldn’t imagine these decades long companies like having, you know, I mean, three to five years probably is far back. You really wanna like, trend to, but it is cool seeing, you know, a few years back, it helps you understand a lot of what’s going on.

Charles:
It allows you also to transition in and out of different marketing channels. Especially if you’re doing direct mail. I mean, you have tons of different pieces that are going out and you can really track it. We’ve done it before with a different business I had. And then also when we’re looking for smaller, you know, multi-family that we’re taking down ourselves or in small JVs here in Florida, and you really know exactly what your return on that is and you’re like, okay. And then once you hit one, then you’re like, all right, this is like a double down type piece. You know what I mean? And that’s really important. Yeah,

Sean:
It’s kinda like gambling too, right? You’re like, sometimes like, we’ll do marketing and we don’t see returns for six months. We don’t, we don’t get a single deal, right? But then all of a sudden we’ll hit a grand slam deal outta a surrounding marketing channel. So it’s like another thing is just, you know, let it fruition for, for a year. You know, you gotta, you gotta try something out. That’s another point that I kind of noticed. So

Charles:
Let’s talk about you you guys moving from single family into multi-family. I mean, when you did that, because this is something that I think a lot of investors that have started in a single family kind of realm, whether they’re flipping or long term rentals or whatever it might be and they like to graduate into multi-family properties. What were some of the challenges that you faced during that transition?

Sean:
Yeah, so, you know, trading the, the greenhouses for the red hotels, right? Monopoly and I mean, you know, it’s pretty natural. Like the rental was easy, you know, renovating a hundred units, it’s easy ’cause we already have the crews. You know, the, the big picture was is we, we ran out of our own capital, right? Like there’s only so much and single family, it’s kind of easy ’cause you can just get hard money loans and they’ll, they’ll loan you up, you know, almost all the way for that. So on the multifamily though, you need that 20 to 30% equity for the purchase in Reno. And so, and yeah, after you’d start doing, you know, a couple hundred units every year, so the equity portion it was definitely nerve wracking. Just, you know, bringing on investors. We, we did one deal ourselves, a hundred unit and wanted to just make the mistakes and, and learn everything on our own.

Sean:
Didn’t make any drastic mistakes, just, just learned a lot, right? And, and learned that, so played with our own money first. Then we felt like, you know, kind of the, the stewardship duty to, you know, and doing all the single families that we could bring on investors. So yeah, just, just finding the right attorney. I mean, I got myself in the weeds a bit on, you know, 5 0 6 c and b offering all the legal work. But I mean, it really is, you just pay a guy 15 to 25 grand and he lets you know everything you need to do. It’s just before you make that pull that trigger and pay that money. Like, you just don’t know what’s going on until till they have. So a bit of a leap of faith and then raising the money, you know was a little, a little bit easier. ’cause A lot of our people that already bought a single family from us as a rental, turnkey, you know, they, they were with us then, you know, not, not too much like difficulty after, after those little hurdles.

Charles:
Nice. so in today’s, what is your current company’s investment criteria and strategy look like? What are you looking markets, are you guys going to, what type of properties are you guys buying? Yeah,

Sean:
Great question. So we, I mean, I’ve shifted. I was with one partnership and now I’m with another. And the one thing is just, you know vision, vision and I guess kind of age as well. So my other partnership, you know, 1 65, you know, he, he has different goals than a 30 5-year-old, right? And it’s just natural and different, like aggressiveness and things like that. And so the new partnership, we’re all kind of around the same age in the same, you know, phase of life, young kids and all that. And, you know, we’re in the phase where we’re ready to grow and, and not wind things down quite as much. So that’s kind of one is that is just, you know, have that vision and culture and, and, and factors in there. Then the next thing is the, the pre, the first five deals I did, they were heavy value add, meaning super distressed, super deferred CapEx and maintenance.

Sean:
I’m talking they were like, probably close to being condemned. You know, maybe not. They’re like, they’re like 50% occupied or less give or take on most of them. And rents were three or $400 below market due to just the distress. So, I mean, bottom super cheap. It’s a, it’s a great flip. Great, great on paper, but you take on a lot more risk of just unknown of, of sewer plumbing asphalt roofing, like just everything, you know, the, the railings, the metal railings. So those heavy ad where they’re 25,000 a door plus on the Reno. And this is for something that’s $800 a month rent after you renovate it. And it was great. It worked out well and it was great. ’cause Also, you know, we bought ’em, like through that covid phase, the rents went up a ton. It’s just a lot more work, a lot more unpredictability.

Sean:
So now I’ve kind of shifted to more, you know, that was, so that’s more like the C minus class, getting it up to maybe a CC plus. Now we’re kind of at buying stuff, you know, a little lighter. It’s already 90% occupied already can get the Fannie Freddie loans, where the other ones, you, you have ’em on bridge loans, right? You got two or three years. That’s, that’s a short timeframe in, in the, in the grand scheme of things to where, you know, you have to refinance or sell at that point. So these ones we get on five, seven year loans, you know, Fannie, Freddie so our strategy is more moving towards the, you know, the B minus make it a a, b, B plus type of asset. Rents are, you know, more 1200 a month. So a little bit different tenant base as well in managing and all of that.

Sean:
It’s still in the, you know, the blue collar zone. Just you kind of have more slightly, you know, someone who can qualify a little bit higher paying job, maybe a little bit more responsibility. So a little easier to manage. And then the renovations are, so our strategy shifting more just the renovations are more predictable. We’re not going over crazy off budget. It’s not taken forever on some things, not as big of surprises. So it’s kind of shifted the risk down. The returns go down a bit. Not, not drastically. ’cause We’re still doing pretty heavy value add and buying at discounts and, you know, holding our carts till we find a good deal. So that’s just kind of bear our, our philosophy. And then you know, just focused on Nashville and Chattanooga now instead of Memphis. It’s got a lot, you know, I mean, Memphis is great. It has its place as well, still, still would invest there if you find the right deal. But I just like those markets a little bit better in terms of just job growth, wage growth population growth, things like that. Yeah,

Charles:
Chattanooga’s a nice market. I went there years back with my, my wife and it’s it’s very nice. It’s a very nice area, definitely growing. And so one of those pockets that people don’t speak about as much when they talk to state, it’s usually Nashville. And then, I mean, people talk men Yeah. People don’t really talk Memphis really. I mean, in my circles, I’ve, I’ve been invited to invest in Memphis and I’ve playfully turned that down. But it’s something that yeah, for everybody. I mean, there’s a, it’s a pace place for everyone, right? In any type of market. So,

Sean:
Yeah. And I, I’ve, Chattanooga been, it is been on my radar for five years. We’re finally getting our first deal, and we’ve been over there ton been rejected, you know, not the first, you know, getting the, getting the deal. So real excited about that market. And yeah, it’s, I think it’s a great market, kind of a little bit under the radar still, but I think it’s gonna get in that radar real soon. Yeah,

Charles:
That’s great. The when, when you were talking about going back in the different kind of progression of your investing in multifamily, and I think most investors, especially the ones I speak to and myself you start with, you know, a little c class stuff. Some people might even go lower, and then you’re they’re progressing to better properties and you’re taking risk off the table. You’re, it’s better properties, better areas. You’re getting into really a credit tenant type demographic. And I found, not that I wouldn’t buy c class properties myself or with maybe one partner, but would I put it with investor money anymore? No, I think it just, it raises risk, and I’d rather give lower returns that are more consistent, less volatile to investors than have you know, hey, there’s upside, but then you have an older property, most likely. So now there’s a lot of unknowns during that. And what you were ascribing is almost like getting into more almost construction where you are have an asset that is so deferred. I mean, it’s like you are, I mean, you’re literally rebuilding the property. So

Sean:
Yes, quite a bit. Yeah, that, that, those are great points. And yeah, I see a lot of people kind of phasing from that and, you know, and there’s a place, and it’s a great investment too, the see, or the BI mean, you make money everywhere just and also the time, right? There’s just, you’re just over there. There’s a lot more, a lot more updates. Also, you know, we’re not, we’re not making, you know, we’re not doing any distributions, right? When you’re 50% occupied till two, three years in when it’s finally getting stabilized, where these other ones, you know, we can do a little, you know, three, four, 6% cash on cash just day one. It’s already cash flow. And so that’s, there’s the big risk part right there. Yeah. And yeah, the, the construction risk just, you never know what, these older houses have just been deferred. And you, you, it’s hard to find a due diligence. You just will know when you get in there and open up a wall, right? Yeah. Yeah.

Charles:
So one of the things that your kind of team really, especially yourself being an engineer, you guys utilize a lot of data when acquiring properties.

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.

New Speaker:
Can you kind of tell us what kind of data sources that you utilize and what you find is most important? And then possibly how investors new investors can utilize data without expensive subscriptions that usually come along with a lot of institutional investors that are utilizing very expensive subscriptions for sourcing data.

Sean:
Ah, so I would just say CoStar, you just, you gotta get CoStar. I mean, on the properties we management, they’re going their quarterly and doing a little survey, and they’re like hitting the ground on every single property. So they’re not just using like, what’s on the internet. They have survey employees all over the country getting the occupancy, the average rents and everything, like quarterly. And so, I mean, it’s just, yeah, you, you get what you pay for the other data, you know? So that’s what I’ve learned. We, we tried for our first deal, but then after that I just went straight CoStar. I mean, it has almost everything on there, of course, the county and all those records. So, I mean, my advice is try to split that with someone so you could get someone who has the access and they can download a lot of stuff for you, and you could work with them on that way.

Sean:
The brokers typically who list ’em will have that, and they can get you all that data too. You just need to know what’s on there. But I mean, I just haven’t found anything better. And that’s why it’s, it’s why it’s there. And just once we, I mean, we were, you know, we, we went to a hundred units, right? Rather the get-go, I get, if you’re starting out with 5, 10, 20 unit things like that, cost isn’t worth it. But man, when we start into a hundred units plus, it’s like, we gotta have this or is like, you know, buying blind <laugh>, right? So I mean, that’s, that’s, that’s my perspective. I didn’t really look at too many others. That’s just where I was at. So it’s just, you know, one man’s opinion.

Charles:
What what metrics did you find? Obviously you’re looking at rents where the rents can go for a property. You’re looking at job growth, population growth, all that type of stuff. Is there any other metrics that maybe are outside of the normal realm of what people should be looking at no matter what their data sources?

Sean:
Man, it’s, it’s like, so, you know, you, you, you, we, I took a course, right? And it’s, it’s so institutionalized and so, you know, cut straight. That’s, that’s why I love real estate, right? This is like a business, like this is recurring revenue, right? It’s a year long lease, year long recurring revenue. It’s been around forever. There’s, there’s data, there’s sources, there’s his way many, his like years, hundreds of years of historical data out there, which free on government websites. See, I, I do use that, of course. And the brokers provide a lot of that too. It’s just out there. So I mean, man, I just, but I just, I just run everything, right? And one thing is we made a custom you know, Gant chart, Gantt chart with, but more in terms of just the cost of renovating ’cause right?

Sean:
You buy 200 doors, they’re 90% occupied. We kind of did that to, to kind of get a more accurate estimation of cash flow, how much reserves we need you know, upfront CapEx you know, basically to let us know like how much we need to raise. Because you don’t wanna over raise, right? You don’t want a million dollars sitting in the operating account the entire time. You obviously don’t wanna be under though either. You do not wanna do a capital call, so, you know, more conservative. So as, as yet again, as I’ve had the historical deals on my previous eight deals, we’ve now created that kind of more cashflow chart, which I mean that you’ve really just gotta grind it out and, and calculate it out over each, do a, you know, a monthly projected cashflow for those first two years as you’re heavily renovating these, these value adds that we’re doing.

Sean:
So it’s like you, you know, and you can work on that with a book, your bookkeeper or yourself. I, I, you know, plugged it out myself. ’cause It was very important to us. ’cause We almost had a capital call. We didn’t though, but we, we just, you know, had a second debt on it. But that, that’s something to, you know, contingency work for. And in real estate, everything’s gonna not go to plan <laugh> anyway. So, I mean, it’s just, it’s, that’s, that’s why it’s hard. That’s why not a lot of people do it, but that’s also why it’s very lucrative.

Charles:
Yeah. There’s a lot of things outside of your control and just trying to navigate between everything. And if it’s done, if you know, you line it up correctly and most of the time it’s gonna work out and there’s ways of alleviating some of that downside, but there’s no way of, you know getting rid of it entirely. So,

Sean:
Right. And, and like exper like there’s the data, but man, your experience and your gut goes with, you’re like, oh, this reminds me a lot of this other deal. It went like this. You know, and this has the exact same thing, you know, just so like, experience, you know, helps out a ton. And that’s, my other partners have done other deals on their own. So we, you know, we have like 2000 doors plus experience, you know, of, of just things, problems, good and bad things that have, have happened. And so now we know we even more like when we see a deal and all three of us are like yes on it you know, that just, just verifies even more if one of us isn’t, we, we really dig into why not, you know, what’s your feeling? Also what’s, what’s the data pointing to that or, or the way it’s been built and things like that to help us know to pursue or not. One

Charles:
Thing I was looking at on your website was that you know, you guys are real estate investors. You’re also you know, you guys also acquire different businesses and can you go into this a little bit more in depth? ’cause This is a little different from other people I’ve had in the show. Most of them are entirely real estate investors and where they sway maybe is going between different asset classes. But tell us a little bit about the types of businesses that your form your firm focuses on purchasing and kind of like what your business plan is typically after acquiring a business like that.

Sean:
Yeah, so doing flips and construction. So I, you know, I like the, the trades just seeing the bids they give me <laugh>. So hvac, plumbing, electrical, especially the ones that require licensing. There’s a hurdle, there’s a moat to get into that industry. You know, and, and years to, to really go off on your own. So I’m, I’m under contract to purchase an HVAC heating and air company. I just like it. ’cause Out of all the, you know, home services, roofing, plumbing, electrical sheet, rock fencing, landscaping, I like it. ’cause It has a recurring revenue aspect to it, right? You’re gonna bi-annually, check up on those units, change the filters, and at that opportunity, it’s a sales opportunity for a repair or replacement. And you’re the go-to person to call. So you, you get a customer once, but they can be a lifetime customer where like those others you know, painting, right? Like they might not need another paint for, for a while where this has some recurring revenue on the service. So that’s what I’m focusing on. Also, also anything that I’m, any of those business I mentioned though, I do like ’em, anything repairing a house services so I’m pursuing those as well.

Charles:
And those are pretty complimentary to what you’re doing too. So it’s something that it’s not that I’m a fan of or ever would probably think of buying a property management company, but it’s different with the HVAC company because you can already say, I have this much work that’s not gonna go anywhere. You know what I mean? So that’s a different a different way of approaching it than going, I guess into let’s just say left field and buying a business that has no connection whatsoever with what you’re doing over here.

Sean:
Exactly. I’ve, I’ve heard a lot of the HVAC problems and I’ve seen all the prices <laugh>,

Charles:
It’s insane. It’s crazy. Yeah, definitely an industry with a lot of lack of people out there. And every time you call one, you don’t call one and it’s not busy, you know what I mean? Everyone is busy and that’s where they don’t, you know, you’re like, how do they appeal same business? Well, they don’t have to have that many people as, you know what I mean? It’s

Sean:
Supply and demand. They can cherry pick, you know, what they want. They literally have more work than their labor force can handle. So,

Charles:
Sean, over the years of going from single family to multifamily buying businesses, I mean, how has focus helped to you to scale your companies? Currently?

Sean:
Yeah, so I mean, I kind of engineered out again, <laugh>. So I mean, I write down, you know, like of course any entrepreneur, I have just those wild thoughts, right? Those wild ideas. Oh, this could be a great revenue source, you know, could do coaching. We could do this you know, YouTube channel podcast, right? And yeah, you gotta, you gotta, you gotta be aware. You have to be purposeful of what you’re doing. You can’t do it all as you know, Charles. So, you know, I just kind of quarterly and actually weekly, but quarterly definitely, you know, real folks. But weekly, I, I take a clarity break, just get on a piece of paper, write down the things, the easy low hanging fruits of ways to improve, I mean, and do those, right? So I kind of go, this, this thing, it’ll take this much time, it’s this much effort, it’s this much importance.

Sean:
And then another column is just like, this is how much more revenue it can generate. This is the investment. And off of those factors, some are intrinsic like value money, right? Of course the one that gives you the most money. But sometimes that’s not the decision. ’cause There’s ease and difficulty and, and what works for me and, you know, the self-awareness of what I’m good at and my skills and my partners and my team. So sometimes it’s, you know, this could be a million dollar opportunity, but we might choose some. That’s just the $200,000 opportunity for growth because that’s just aligning with me and my vision and what I want and enjoyment and difficulty and stress as well, right? There’s the stress factor of just where you’re at in your life and it ebbs and flows. But just, so I guess just focusing on where you’re at, what your capacity is now where you want to go, and taking those, those baby steps.

Sean:
‘Cause There’s the big step of where you want to go in the future. But, you know, kind of just planning, breaking that down into weekly and quarterly you know, action items ’cause it’s, it’s, it’s thousands, tens of thousands of little tiny, tiny little steps to get up to that big goal. So you just focus on those weekly ones and yeah, I give myself three to 10, you know, to do things every week that are getting me towards that bigger goal. So I hope that kind of helps a little bit with understanding. It’s just, you gotta have that awareness and, and journaling, something I’ve been getting into the past three years is, is journaling down those emotions and feelings and you know, your, your goals, your visions, your life. And I, I love it because I, I just toss that paper away so then there’s no judgment, right?

Sean:
You just, you just get it and you just, just put it in the shredder. Of course some you do have journal and you like keep ’em right? But most of ’em, I just, just throw ’em away. And it’s just a good way for me to have that awareness. Because us as entrepreneurs, we get a lot of stress. We get a lot of, you know, a lot of crap <laugh> that comes at you and you need that paper. That paper is that way to compartmentalize, get it out there, you’ve expressed it, you feel it but then it doesn’t affect you. And, and it affects onto your team, your employees, your customers, right? You need to, you need to have that and process it is, if you just hold it in and don’t express it and have an outlet you know, you, you see it with tons of entrepreneurs, right? They, you know, they have an affair, get divorced, partnership breakup, make a bad decision. Not saying, you know, I’m not, I’m free to everything, but I think it helps reduce those chances and helps you just live a little more fulfilled and, and feel good.

Charles:
Yeah, lot of great information there. I had a a mentor and I think it was like 2018, tell me to start journaling and it was something he’s like, just start doing it weekly. And I’ve been doing it since and it’s great. It’s great to put down things, things that you’re thinking, what’s going on. And when you look back on it, I mean, a lot of stuff you’re dealing with, you kinda laugh at that was really stressing out years before, and you’re like, oh, yeah, yeah. So I mean, it gives you, I think it builds a confidence muscle too. ’cause You’re only, you don’t really, I mean, you don’t look back at everything and sometimes it’s stuff you look back at, maybe it’s not the best or there’s a tough times or whatever. It’s, you don’t look back at all your maybe wins, you know what I mean? And charting those wins, no, no matter how small they are I mean, gets you up for another day to fight as an entrepreneur, I think.

Sean:
Yeah. And we do that with our teams quarterly and annually is, you know, we have a big whiteboard and what went well? Like, let’s celebrate this. Wow, good job, Alex. Like, that was a great win. You, you landed that big client or so and so, man, you got the renovation down from 110 days on average, you’re at 90. Like, how’d you do that? That’s amazing. Look at that shift. It’s like just, and the data helps you too, like pinpoint who’s doing well and like celebrate those wins on what’s improving on our metrics and numbers, but then asking like why and how and like, you know, like how can we emulate this like nice work? And it, it’s super fun to do that with your team. And then, then you, then after you do that, then you dive into art. What’s going wrong, everyone? Like what are the problems? What can we improve? Right? But it’s, you gotta, you gotta write those down. So as

Charles:
We’re kinda wrapping up here I know we’ve gone over a few different things with kinda mistakes that it’s been made before and kinda real estate and business and how you see it. But what are common mistakes maybe that you see real estate investors make? I mean, you’ve been almost in this for several years now and a lot of properties under your belt. What do you think are those big things that you see many real estate investors make and or maybe you’ve made yourself,

Sean:
Well, I mean, if you can look back getting bridge debt with adjustable rate mortgages is probably like, I mean, right? That that’s what’s killed a lot. Luckily, like we got out of ours before refinance into long term. I mean, but that’s like something, you know, like, it’s just so hard to know what was going on in 21 and 22, right? And that big change 20 year, 40 year, just massive increase. But mistakes is, is they don’t pay attention to this, to this awareness stuff. They, they get way stressed and way high strung. They don’t delegate to their team. They don’t listen to their people and ask questions and, and get outta their way. They don’t seek for self-improvement coaching or reading or listening to podcasts like this. And, and they, they get stuck in their little zone and, and, and just kind of in their box and fearful and missing out on, on great growth opportunities.

Sean:
And then, yeah, I mean, just a lot of those things I would say. And then just the big thing is just getting that culture is something, I mean, it’s talked about a lot, but actually doing it takes a lot of effort, getting that team culture and that, that really is what’s, when I’m reading on like, you know, Marriott Huntsman you know, apple, all those guys, it’s, yes, they had a great product, a great decision, but it would not have done even half as well without that. Just the culture and energy and the, the, I guess just the pure force of a thousand lions that the whole team had just together of just wanting to accomplish something great. So that’s where you go from a good manager, a good business owner to like an amazing leader, and you really change the lives of the people. ’cause When you accomplish something, even if you’re the bookkeeper on the team, and it’s a big company, like, it, it, it, it drains into the other people and, and I hope fulfills the lives of their kids. And they’re, they’re, you know, they’re happier when they go home and, and everything like that and just improves the community. So entrepreneurs have a big control whether they know or not of just, you know, people’s lives and their happiness and their satisfaction.

Charles:
So as we’re kind of wrapping up here, what are the main factors contribute to your success over the years, both personally and professionally, from prior to getting in real estate, during your real estate career and then also with other businesses that you’re running in addition to your multifamily company?

Sean:
Yeah. So a lot of people just, you know, come that are getting started and they just, they just have these, oh, well I don’t have the money. I don’t, I don’t know how to do it. It’s like, I didn’t know a dang thing I was in biomedical engineering. It’s just, you just gotta learn, talk to people. It’s, you know, you gotta be courageous. And then also like, but like learn and educate, you know, as, as quick as you can and then implement what you’re learning. And then I guess what I just talked about, last question, just that’s pretty much the same answer there is, is that those culture and those other things I was talking about, so put a little bit of the previous question, that’s kind of the same answer there too. And then I’d add just just coaching, coaching, mentorship just, just helps you just get, get your thoughts again and, you know, if you have a good coach, they, they question you and it just helps you know where to go and what you’re really seeking and how to solve the, the difficult problems you have ahead.

Sean:
And you really, you really need support. You can’t do it on your own. You, you need that support. You can’t go as far as you’d want to at all. So be humble and seek advice and support.

Charles:
A lot of great advice there. Sean, how can our listeners learn more about you and your business?

Sean:
Yeah, so LinkedIn, Sean Taggy, hit me up. My website, acorn ea.com. That’s Acorn, A-C-O-R-N, eea short for equity and acquisitions.com. That’s why I’m kind of doing stuff. But yeah, you can hit me up there and happy to help anyone out. Well,

Charles:
Thanks so much for coming on today. We’ll put all those links down into the show notes and looking forward to connecting with you here in the near future. Sean.

Sean:
Yeah, thanks so much for having me on, Charles, I appreciate your insightful questions and it’s a pleasure.

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.

Announcer:
Nothing in this episode should be considered specific, personal or professional advice. Any investment opportunities mentioned on this podcast are limited to accredited investors. Any investments will only be made with proper disclosure, subscription documentation, and are subject to all applicable laws. Please consult an appropriate tax legal, real estate, financial or business professional for individualized advice. Opinions of guests are their own information is not guaranteed. All investment strategies have the potential for profit or loss. The host is operating on behalf of Syndication Superstar, LLC, exclusively.

 

Links and Contact Information Mentioned In The Episode:

About Sean Tagge

Sean Tagge grew up working on his family’s 100-acre fruit orchard in Brigham City, Utah. He worked long, hard summers growing, harvesting, delivering, and selling their produce. He graduated on a scholarship in Biomedical Engineering from the University of Utah in 2014. Upon graduating, he worked at the University of Utah Hospital doing research on artificial hearts. In 2017, he transitioned into his true passion: entrepreneurship.

From 2017-2022, he was a partner and the Chief Operating Officer of Memphis Investment Properties. There he managed the day-to-day operations of acquiring, renovating, and selling single-family properties in Memphis and Nashville, TN. He used his engineering skills to organize and streamline the systems and processes of the business. He has been involved in over 1500 single-family real estate transactions.

For four years, he provided business consulting services for a property management company, where he facilitated their weekly, quarterly, and annual leadership meetings. He has additionally consulted with several other real estate investors across the country.

Since 2019, Sean has been a general partner on a team that has acquired 9 multifamily value apartment complexes totaling over 1300 doors. His partners have raised over $50M in equity from limited partner accredited investors to acquire these apartments, totaling $144M AUM. The multifamily properties are in Nashville, Memphis, and Chattanooga, TN.

Today, he is in the process of acquiring a small business in Utah so he can be close to family. He started the company Acorn Equity and Acquisitions to do so.

He spends most of his time with his beautiful wife and 3 wonderful kids. His hobbies include snow and water skiing, pickleball, hiking, and dirt biking. He is training to complete his first marathon and finished the Ironman 70.3 in Saint George, Utah.

Are You a Fan? Subscribe, Rate, Review & Share – Click Here To Learn How

What question do you always wish I would ask but I never do?

Connect with the Global Investors Show, Charles Carillo and Harborside Partners:

Scroll to top