After immigrating to the U.S. at a young age, Marco built a portfolio of 40 rental properties across Florida, Georgia, Alabama, and Mississippi and retired from corporate life at 45.
Today, Marco specializes in facilitating commercial loans that help businesses achieve their property goals. His approach is grounded in years of hands-on experience, primarily in the fix-and-rent strategy.
Charles:
Welcome to our episode of the Global Investors Podcast. I’m your host, Charles k Carillo. Today we have Marco Pfeiffer. After immigrating to the US at a young age, he built a portfolio of 40 rental properties across Florida, Georgia, Alabama, and Mississippi. And he retired from corporate life at 45. Today, Marco specialized in facilitating commercial loans that help businesses achieve their property goals, and his approach is grounded in years of hands-on experience, primarily in the fix and rent strategy. So Marco, thank you so much for coming on the show today.
Marco :
Hey, Charles, thanks for having me. Appreciate it. So
Charles:
You have an interesting background immigrating to the United States from Germany, and then also having a W2 and getting out of that W2, which I think is a goal of a lot of people that try to get into real estate. So can you tell us a little bit more about yourself personally and professionally prior to getting into investing in real estate?
Marco :
Yeah, so born and raised in Germany. I was 26 years old when I came to the us. Came alone never been to the US before. My English was awful and didn’t know anybody in the us. The only thing I had that had a, a contract with a German company who was looking for a German financial analyst to help them with the integration of a, of a US operation that they bought with a reporting to Germany. So that’s how I ended up in the us. Ultimately this company went bankrupt, but I decided to stay in the US and had a corporate career from financial analyst to internal auditor to controller to ultimately becoming chief financial officer. Was a chief financial officer for about 10 years. And then along the way I discovered real estate initially, single family.
Marco :
The, the, the pivoting point was when I was in 2016, I lost my, my event job as a CFO had this wake up moment like, Hey, there’s no cash coming in. I mean, I, I was okay. I mean, we, we had some money saved, obviously I had a, I had a good salary but I realized how depending it was on W2 and and looking back in hindsight, it was a pleasant blessing disguise. So for three months I went all in into real estate learning, going to meet up, going to conferences, getting coaching, and went back to work corporate job. But I started buying singing families. So and I looked at strictly for cashflow. Initially I wanted to have like three, $4,000 in cashflow coming in. So the idea was if I ever get unemployed again, I still have $4,000 coming in that’s gonna cover my basic expenses.
Marco :
So this was 2016, <laugh> in French was not as bad. And and yeah, and then what, what happened was the snowboard effect. So basically you start with one. I used the, the good old bur strategies. So I bought properties, got them fixed up, raised the value, refinanced them still cash flow on them, and basically recycled the money and bought, bought more property. So my assets paid for my assets. By 2020, I had about 23 rental properties. I was flipping a few houses along the way. I also got into multifamily, so I had a 12 plex at the time. And yeah, I wasn’t making more money in real estate than in my corporate CFO job and decided to retire from the corporate life as well as September, 2020. And since then, I scaled up to 150 apartment units in a joint venture with a business partners, ultimately sold them in 2020. And I still do single family rentals. So right now I have a portfolio about 45 single family rental properties. Right.
Charles:
And so they’re in all different states. When you were starting out, you had a W2, you were buying properties. Can you tell us a little bit about how you were managing those properties? I mean, ’cause you were managing renovations, we’re not just buying like, you know, turnkey properties. So can you talk a little bit about how you set it up with like what markets you used and how you were able to manage it while having a W2 and do the renovations?
Marco :
Initially I invested where I lived, so I lived in, in Houston, Texas. When I, when I lost the job, my next job off the red was in Huntsville, Alabama. So I started buying property in Huntsville. What’s a little bit unique is from relative fairly early, i, I, I started investing out of state. So I I come to Fort Myers, Naples area since 2011 for vacation. And and thought it was a good idea to buy properties here, to have like a property out of state. I also love the market. I was very bullish on the market and from a tax pers perspective, it was a write off. So I figured if I never, I come here for vacation now, it’s gonna be a write off. And I start investing here. I had a good network. I knew a bunch of people and I I found some good contractors and yeah, I was able to manage remote, so I learned to manage remotely. So learning remotely means basically monitoring the contractors, setting clear expectations, setting clear timelines initially use the property manager. Later on I started self-managing properties. But also a lot of it came through when I renovate homes, I, I mean, they, they looked like you could sell ’em. They like a flip. I would do it. And so I, I address many of the issues upfront in terms of maintenance, and by doing that, I, I mitigate the risk of, of maintenance issues along the way. Yeah.
Charles:
So you said when you get got into it, your goal was to make $4,000 a month. Obviously this is like 10 years ago, but can you explain how your kind of investment goals and your strategy really progressed to becoming a full-time investor and eventually leaving your W2? Because it sounds like you got into multifamily, but you’re back now fully in single families.
Marco :
Yeah, I mean so single family, I, it was basically every house, three to $500 in cashflow. So my goal was initially five, 4,000. That meant I needed about 10 houses more or less. And then, like I said, the, the snow snowball effect kicked in. So, okay, I did 10, I can continue doing this. I failed to do that. While I was still working, obviously it was hard. I worked 50, 60 hours a week in my, in my regular job, but then the, the evenings and the weekends were for, for real estate. And I think that’s a lot of people that they look at. Once in a while I get encounter people like, oh, you have all these houses and all that. I mean, it’s, it’s hard, you know, especially if you’re in a W2, but I always would all recommend people to do, build that cashflow while they have a regular job.
Marco :
‘Cause There’s way too many people there surprisingly get laid off like, oh, what am I’m gonna do now? So I think it’s, I think you have to prepare for moment while you’re still working. And and, and then when I got through this number of like, okay, I can keep doing this. I mean, I got 10, 12, 14 it’s, it’s gonna, it’s, it’s this, this process, you know, and like I said, I coming come into a <inaudible> family. So I found a good business partner. We did a joint venture. We didn’t do syndications, and we started buying 40, 50 unit apartment buildings and basically the same thing, fix ’em up, get them rented, get dock the occupancy up. And then ultimately in 2022, we decided to sell them. We felt like where the interest rates were going, we kind of hit the peak of the market. Usually very bad in timing, let’s say if stocks or anything like that. But this one actually per we, we can’t perfectly, the last one we sold in September, 2022. And a lot of the proceeds I bought additional properties. And yeah, so I just do the single family for now. I will get back to <inaudible> at one point. I just haven’t found the right opportunity. There’s just a lot of noise, not family right now. So I just can of wait for the water a little bit to calm.
Charles:
So how do you handle property management on your current portfolio? Because I mean, you’re over four different markets, four different states.
Marco :
It’s a mix between property manager and self-managing. Okay. It’s about half, half. Property manager. I think one of the biggest challenges in, in this business is finding a good contract and finding a good property manager. So over the years I’ve fired, I’ve hired and fired over well over a dozen property manager. It’s, it’s, I mean, just in general, nobody loves your house. Nobody loves your asset like you do. You know? So if I give my house to a property manager who manages four other houses or manages 2000 other units, I’m, I’m just one of many. And and some, some are more, more interested in how the investor performs and some are just doing their job. And so it’s finding good problem is, is it’s a big challenge.
Charles:
How did you find those property managers? ’cause When, for multifamily, when we’re finding property managers the best ones I’ve found is from other local investors that are in the same property, like class type size, pretty much like the same properties I’m buying, speak to them and they give you, and everything is good. Anybody you can get from them is very good. Agents and brokers not as great. But how do you find it with like, single family? Because what I found in single family, or when I was looking, if I go into a new market and I, you know, you’re searching for property managers, I usually would find like part-time real estate agent slash property managers that are doing like vacation homes. And I mean, how do you find a good single family property manager?
Marco :
Yeah, those, those, those are the worst when no offense to real estate agents or real estate brokerages, but they’re by far the worst property manager. Would never, anybody who ever gets in single family or wants to build a portfolio, never ever use a brokerage or a real estate agent as your property manager. It’s just not their business. They just don’t know, they’re just not good at it. Similar to what you just described, talk to other investors, find other single family investors and, and sometimes it’s just trial and error, you know? So like I invest mobile Alabama, I, in 2020, I bought four turnkey properties. So somebody renovated them, fixed them, put a tenant in, and then sold them with a tenant in it. So I used that company turned out they were not as good as I thought they would be.
Marco :
And you just move on or you, or you or you start self managing. The other thing I learned is how to self-manage, you know, so especially if you have a newer home where there’s less mag maintenance issues I always have done some built to rent where, where I have brand new homes. It’s just, you have just have less issues. And in this case if you put the right process in place, if you put the right, you have the right tools, you can also self-manage. Obviously multifamily is a different store. I would not recommend self-manage anybody in anything multifamily in, in single family. I think self-managing is an option if it’s the right, the asset, the right type of product.
Charles:
Yeah, I think also in single family, the, the benefit that will always be over multifamily for the most part. I mean, maybe now it’s a little different, but or maybe it’s longer for both. I think you just have less turnover and think that’s, you can spend a little bit more time vetting people and getting them in there and finding someone that’s gonna spend not just your 12, 24, 36, but maybe like four years plus in there. And I think that’s like the whole benefit. And there’s more of a pride of living ownership with someone in a single family versus especially the, their kids into the schools and everything like that. I mean, it’s now it’s just these are all these factors.
Marco :
Yeah, I would fully agree. Like I said, I own, I own, I own apartment buildings as well, so, so it’s, it’s a different type of tenant in general. I mean, there’s some overlap, obviously, but in general, I mean, I have houses. I still have the same tenant from when I bought it 5, 6, 7 months ago, you know, so you, you, you rarely find it in the, it’s more transitory in a, in a multifamily and but yeah, it’s a different, different type.
Charles:
Yeah. My first couple multifamily properties were in like small three family type properties and you still had a almost like a single family feeling to that because you had the backyard driveway all pretty much all to yourself. And I had tents in there for 10 plus years, you know what I mean, when I sold them, you know what I mean? So it was you get stickiness in these type of situations that are single family or very close to a single family type experience for your tenants, I found. So let’s talk about your company opportunistic,capital Group and kind of what your, what you guys do and how you guys in,assist investors with,placing them with loans and all everything else. Yeah,
Marco :
I mean, basically, I mean my, my main business is still the rental problem. Well, main source of income. My main focus is the rent from, but however, I, I, I slowed down. I don’t, I’m not as active anymore. I actually sold a few assets in the semi family space. I buy, when I see the right opportunity, I buy one. And then along the way, I had a lot of investors. I’m very active on LinkedIn, so, so I post about some of the deals I do, some of the things I post about my story. I think a lot of people on LinkedIn can relate to that story of working a corporate job feeling the, the, the, the being on the hamster wheel, doing the same thing over and over, sitting in endless meetings but having these golden handcuffs. So you have a mortgage, especially with kids.
Marco :
You have a mortgage, you have a car, note, you, you, you, your lifestyle usually as you get promoted or as to rise in the ranks in, in a corporate world, usually lifestyle and your expenses go up with it. You get a bigger house, you get a nicer house, you get a nicer car, you get more vacation, longer vacations whatsoever. And and I think a lot of people can relate to that story. And housing other investors, I built some good connections with private lenders. So and, and residential, I mean, you have two options. One is the regular, the Fannie Mae mortgages, so usually it goes with a bank or Wells Fargo, chase, something like that. But there’s also a, a a, a growing market and has, has grown substantially as commercial loans for single family about 10, 15 years ago that Mark really didn’t, didn’t exist.
Marco :
And what kind of Blackstone opened, opened the door for that when they start buying 50,000 single family homes. Nobody ever, because one of the downside about single family, what you hear spread from modern family is like, you cannot, you cannot scale up single fam know, which is true to some extent. However, Blackstone kind of made the case when they bought 50,000 houses. You can, you put the right process in the right focus on it. And if you have the financial, obviously the financial resources and, and so that more, more institutional investors, more even investors like me trying to scale up, it became more interested for the commercial, commercial lending space. So, so what I started using is what’s called DSER loans, that service coverage ratio loans which are still 30 year mortgages, just a commercial. They’re in an LLC, they’re not my personal. I, I couldn’t even get a personal mortgage anymore. I’m not, I wouldn’t qualify for it. Yeah,
Charles:
W2, right?
Marco :
Yeah, no, W2, I think we can have max 10 houses and then, then we cannot qualify anymore. And and through that, I, I build these connections. The, these lenders like me, they know I perform, they know there’s never a late payment. They know whatever. I usually, I’m pretty good when it comes to estimating the ratio, whatever the, the ratio, the renters, the, the so I build some strong connections, people on LinkedIn, other investors reach out to me. So, hey, I’m trying to get financing. I cannot get financing. So I, I start connecting the two. So lot of those private lenders are hedge funds or, or for financial arms of private equity firms like Blackstone has a, has a has a mortgage operation. And and then I have these, these these investors that reach out to me and say, Hey, I need some help. I have a flip. I have a house that needs to be refinanced and, and things like that. So try to connect the, connect the two.
Charles:
Yeah. One thing you mentioned earlier about people be suggesting people start building a portfolio while they’re working. And one of the things that major part of that is obviously if you’re buying one to four unit properties, the financing is so much easier. And I think it pushes people into the five plus unit commercial, let’s just say multi-family realm, because the financing completely is like a 180 and it’s much easier. Yes, you have to have a solid down payment in most situations. You know, you can always work out deals with certain banks, but for the most part, they’re gonna be looking more at your asset, the property versus, you know, Marco the, with the borrower type person. And that becomes, I think, a little easier. Now, let’s like, talk about like what you’re buying now. So interest rates are down a little bit, but they’re still, you know, we’re still high. You know, historically over the last, the several years, let’s say how is your, you’re using DSCR loans, which in, as I understand with that, that’s, those are heavy down payments, they’re probably gonna have a higher interest rate than a typical FHA, is that correct? Like for an investment loan? Like, tell us a little bit more about what you’re doing. It
Marco :
Used to be a point difference. So if the FHA 30 year March was five A-D-S-C-R is six, but that actually came down. So that gap, it’s maybe like a half point now. Difference FHA was DSCR. Now, obviously it depends on the deal. It depends on how much you service ratio. Is it 1.0? Is it 1.3? There’s a lot of factors going into it. But, but in general, it’s, it’s DSCR is, is, is, is 20 to 25% down payment. And it’s just much easier. It’s not, I don’t have to provide tax returns, I don’t have to do it. It’s, it’s very similar to a, a, a multifamily commercial loan, you know, so that, that, that helps definitely is, is a makes the process much, much easier. And and from, from what I look for what I, what I buy, I did, I did this house this year, built two houses, kind of built to rent model.
Marco :
I found a, a builder where I could kind of cost plus deal, which worked out pretty good. So I, I had some initial equity, substantial equity in the houses right after, after they were built. That’s one of my focuses. And, and, and, and still, like I said, the, if I really see a good opportunity where I feel there’s a strong cash, my, my focus has shifted a little bit. I used to buy a lot of nicer bee homes, that means they were renting for like 2,200 in the markets I’m in in Alabama or in Mississippi. So 2,200, $2,300 homes. They were really nice homes. But, but I kind of shifted that focus. What I, what I noticed that, that the, the homes with higher rent sit longer. Two, three years ago there were, I mean, I had a home for $2,200 in Mississippi, which is on the higher end in the markets I’m in. And that was rented within five days. That same house is sitting now for 2100 or $2,000 sitting for a month. So, so I kind of, I shifted my focus more into the 16, 1700, $1,800 rent houses and, and those, those are still buy.
Charles:
Nice. Okay. So what would be kind of some of your advice, other than people starting out earlier than later, which I think everybody that I speak to is a real estate investor, kinda what they say. But what would be some other common mistakes maybe you see on the other end of this real estate investors that wanna start building a portfolio and when they’re buying properties or any part of the purchasing or managing process, where do you think most real estate investors or where the largest number of mistakes are made?
Marco :
I think the first one, I wa just wanna address what you just did with age. I think I think a lot of people consider age a problem. I, I, as I, I get message on LinkedIn all the time or, or, or comments. Oh, I’m 55 already. I wish I had, I had, I had learned this 10 years ago. I wish I had learned it 50 years ago. I, I feel you’re still, you’re still po I mean, it’s still possible. I know, i, I coach, I want, sometimes I coach people, people reach out to me and coach me. I coach a guy. He’s 57 and he, he, he bought within two years, 10, three years, he bought 10 rental properties. You know, so the, the age is, is obviously yes, I, I mean, I start when I was 40. I wish I’d started when I was 20.
Marco :
Absolutely. But I think I think it’s still, it’s still possible. You know, I don’t think, I think one of the two, the issues, people should not have their age hold them back, you know? That’s one thing. And I think the, the biggest issue I see is the analysis, the paralysis trap where, where people analyze and analyze and, and then they’re gonna, they have these ele elaborate models, especially for single family. I understand in, in, in multifamily it’s a different kind of, I mean, it’s a different val valuation different ways. I understand you have some more, more elaborate models. I was CFOs, I fully understand IRR cashflow modeling predictions whatsoever. I don’t really think you need that in single family. And, and I think a lot of people are like, oh, I need to account for a vacancy. I need to account for this.
Marco :
I need to account for that. I can, and if you account for enough things, then every day looks, you know? So and so I think the analysis persis just not a good time, you know? Oh, will say price are too high. I’m gonna wait until price come down, then price come down. Oh I think they’re gonna come down more, you know, and then price pick up again. Ah, they picked up again, but they’re gonna come down again. You know, it’s just people always find a reason not to buy. And and then you look back, I mean, I started in 2016. I remember in 2016 one of the people I went to meetups, there was one guy he was teaching a lot. And, and he, he sold his entire portfolio. He had about 30 houses. He sold them all in 2016.
Marco :
‘Cause He was convinced that the market went up so much since the financial crisis. It has to correct. And then when it corrects, he has all this money and it’s gonna buy it all up. That was his strategy. Well, he’s probably still waiting, you know? So there’s just, it’s just, it’s, it’s, it’s hard to time the market and then every time, whenever, whenever you buy and you look back 10 years ago or 10 years out, it, it’s, it, it turns out to be still a good deal. You know? I mean, any, anybody who, who want me in 2020, I shouldn’t buy anything because of COVID or whatsoever. Well, anything I want in 2020 performed very well, you know? So so I think that analysis paralysis and yes, it, it can be sick, multifamily is, is struggling right now a little bit single family at one point will struggle. But if you look have a, a, a long enough time horizon, I think ultimately it’s, it’s, it’s gonna work
Charles:
Out. Yeah. This old school real estate investor told me many years ago that he, I kind of coined it as a 10 year law of real estate investing. But really, if you’re holding a property, make sure you purchase it and you could hold it for 10 years because in 10 years you’re, any mistakes you’ve made with it, they’re gonna be kind of washed out. You’re gonna make money on the property, the promise where people, for lack of a better word, get cute. And they’re trying to do stuff that’s like three years and two years, and they’re using all these aggressive financing strategies, and that’s the people that get wiped out. It’s very rare that you’ll speak to someone that was like, oh, I was on long-term debt that was fixed and I had a reserve fund and it was cash flowing and I lost all my properties. It doesn’t happen. So it’s really like, that’s, that’s kind of what I’ve learned. It’s like, yeah,
Marco :
And <inaudible>, all these investors were wiped out was because they were highly leveraged and they didn’t have any reserves and in and you a lot of terrible interest rates, you know? So, and it just got wiped out. And I learned that in, in my very first rental property. I was an accidental landlord. I bought a property in Huntsville, Alabama for $180,000. One year later I, I was promoted for, for another job. I left Huntsville, moved to Louisiana, and my, I didn’t know anything, unfortunately, I didn’t know anything about real estate, and I didn’t buy second after that for like five, six years. But that one, my, my agent told me, Hey, you can turn this a rental. And I’m like, okay. And at the time, my rental was like my, my, my mortgage was like all in 1150 and I could rent for like 1200.
Marco :
And I was like, oh, wow. I, somebody’s gonna pay my mortgage. So I was very naive in this thing. However, somebody picked my mortgage, that house dropped about in, in June, 2008. So if you pick the worst months possible to buy a house, <laugh>, I mean June, June, 2008 is probably right up there. And that house dropped to, you could buy houses next door for like 1 35 in, in, in 2010. That house got appraised in two years ago for $320,000, you know, so, and it was rented the entire time. It was in a great location. It’s 2010, it was vacant maybe 15 days. The whole, the house been their long-term tenants of people in there lived the, the first tenant lived there for six years, the second for like four years. So yeah, I learned that, like I learned firsthand. Yeah, if you just have a long enough vision and if you’re not hurting on that, I didn’t, yes, it dropped to one 30, but I didn’t have to sell, you know, I still had my income, my mortgage was covered, I didn’t have to sell. And if you just have a long enough time horizon things will even up.
Charles:
Yeah. I mean, really the value of property only matters when you’re buying, selling, or refinancing. And if it’s outside of those three times, those milestones in the lifetime of that property, it doesn’t really matter much. You know what I mean? You, you know, and the good thing is that when you’re getting into investment properties, it’s more and more difficult to value them. You can’t just go on Zillow and type in something per se, you know what I mean? So it, it’s actually better for investors because it’s not like checking, you know, checking stock quotes, you know what I mean? It’s something where you’re like, I, I guess it’s this. I don’t really know. And that’s great. So I’m back to my regular life as this thing just kind of put us along. So, and
Marco :
I think, yeah, actually like multifamily, I think it’s a good example. I think, I think there was a lot of, a lot of noise. I think it’s, it’s, it’s calming down now and, and probably people who bought stuff in 24 and 25 will look at it back in five years from now. I feel pretty good about what they have. I
Charles:
Mean, even peel
Marco :
Now, I mean, the moment right now probably don’t see any appreciation, you know, it’s like you know, gotta make the cash flow and, and, and whatsoever, but I feel pretty strong in four or five years from now. It’s, it should be anything you buy, anything, any, anything. What cash flows now will definitely cash flow in four or five years and have some nice appreciation.
Charles:
Yeah. That’s the benefit is that you can refinance it down the road. I just feel like even if Peel bought stuff at the top of the market in 21, 22, if they’re good properties, so like solid CB class properties you know, not in war zone type stuff that don’t really go up, which are always kinda a mess. And selling them on a mess too. Not just managing ’em. If, you know, 5, 6, 7, 8 years down the road, you’re gonna be in a very good position. It’s really just making sure when you buy, you have all your ducks in a row where you can hold onto this property for several years, you know what I mean? And I think that’s what most investors miss. And investors getting in 22 thought they were gonna see rent increases like 21, and it was just went pretty much stagnant, you know what I mean? And people’s performers weren’t, weren’t like that, so, and they thought that interest rates were gonna stay somewhat around the same, they didn’t know it was gonna go up so high. So a lot of factors you can’t control, but you could have controlled or there’s ways of doing it where but that’s, that’s a thing where you might have new investors that are in, that are already out of the business, you know what I mean?
Marco :
Yeah. And I mean unfortunately there’s several assets in, in multifamily that, that were foreclosed on or, or the keys were handed to the lender in the last two, three years. And, and those are the ones usually bought in 21, 22. Arguably they’re probably overpaid to some extent. And yeah, and had to like bridge loans for two years or something like this. Those are the ones that really struggling. Anything you bought in 22 with the long term debt, I think you, you’re still gonna be okay.
Charles:
Yeah. So Marco, thank you so much for coming on. How can our listeners learn more about you, your business, kind of your investments? You said you’re very active on LinkedIn. Yeah,
Marco :
That’s probably the best way to, to find me is, is on LinkedIn, Marco, M-A-R-C-O, Pfeiffer, P-F-E-I-F-F-E-R, very active post, daily post about real estate, but also post about economy, boast about my favorite subject taxes, <laugh> and <laugh> and so yeah feel free to reach out, send me a message. If you hear this, this podcast, you have any questions, feel free to send, send me a message there or connect with me on LinkedIn. Awesome.
Charles:
We’ll put your website and your LinkedIn address in the show notes. So thank you so much for coming on today.
Marco :
Great, great record to be on there. Thank you so much.
Charles:
Talk to you soon.
Marco Pfeiffer is a real estate investor and former CFO turned Middle Class Rebel. After immigrating to the U.S. at a young age, he built a portfolio of rental properties across the state and retired from corporate life at 45. Today, he shares practical strategies for financial freedom through real estate and entrepreneurship, speaking on podcasts and with a growing audience on LinkedIn.
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