REAI 46 Ken Van Liew: Burst the Chains of Unforgiving Debt and Explode Your Wealth!

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Enlightened Investors. If you, like me, have had at any time in your life found yourself at the bottom of the financial barrel, chained to mountains of unforgivable debt with no relief in sight, then today we bring you the formula that will burst those chains and explode your wealth. Ken Van Leeuwen started his professional career with 2 master's degrees, a civil engineering design job, and twins to support. All this under the weight of a 6-figure debt and a burning desire to serve others. 10 years later, he cut the ribbon on the development of a $17 million, 72,000-square-foot, 113-bed assisted living facility. He parlayed this success into a Staten Island waterfront development. While attending a Tony Robbins event in Hawaii, his waterfront development was terminated. due to the World Trade Center tragedy. After a full recovery and 19 years later, Ken can authoritatively bring us the keys to the modern wealth-building formula as the fastest track to building wealth. Ken, take us deeper into the story of your phenomenal success by sharing a memorable experience from your formative years that helped you to be the person that you Thank you very, very much, Steve.

It's a real pleasure to be here today. And, you know, I have so many, but the first comes to mind, you know, when you read that interesting day on 9/11 where I lost my best friend who worked for Cantor Fitzgerald and, you know, the view of the waterfront property that I was celebrating on in Hawaii vaporized. And it was something that I guess when I was standing there at that moment when it occurred, I had no idea how I was going to even go back to the United States. Well, at least I thought I was outside the United States. It seemed like we were on another planet when it occurred, but how I was actually going to go back to the metropolitan area and lead people when I was worse off, probably as much as everybody else. I just lost $500,000 that day and my best friend, and here I have to go back and be a leader. I didn't know how to figure it out. I just kept remembering Tony Robbins say, your feelings are going to be based on what you focus on. And for 10 years, I didn't watch that tragedy on TV until I put closure onto it 10 years later. And I think really just overcoming that day where I didn't have an answer and didn't know where to go was something that really molded me into who I was today. It didn't kill me, but it made me a hell of a lot stronger. And thank God. the opportunity to lead people.

Well, that wasn't the first time in your life that you had to face financial challenges. You actually started out as a young man with a heavy debt burden while working, I guess, a W-2 job.

Yes.

And at the same time supporting a family. Take us down that journey. And how is it that you were able to go from a 6-figure debt and clear that up? And go to several years later, cutting the ribbon on a $17 million property?

Yeah. It's a long story. So I'll give you the short version. Many, many years of working in the city and trying to have children, it became very frustrating and the debt just kept growing. And I probably was— I was 31 when I finally had twins. We had some challenges physically, but it was really once the kids were born, I didn't have enough money to buy a formula diaper. And I remember a moment at Costco where I think my credit card didn't pass and I had to make a phone call or something. And it was at that point I was like, this just isn't going to work. How am I going to have twins? I started thinking like, wait, oh, I hope I have a good life insurance policy or something because I'm not going to be able to put them through college. But it was a dark time in a very bright time. And it was a lot of mixed emotions. And I remember, fortunately, and I kind of call it my top-down thinking, standing on top of a 30-story building in Brooklyn, looking out at Manhattan and saying to myself, do I need to be born into the family of a developer? Is there any chance that I could do this? And it was a lot of daydreaming. And it led me to one day where I was asked to play golf at a country club. My mother-in-law, who I probably wasn't her favorite son-in-law, but she asked me because I was the golfer. I go play golf and I started daydreaming, like maybe I could belong to a country club one day. I remember coming home that day and telling my wife, if I could just join that club, they have an executive special. I could tell them my story and I'll be able to raise money and live my dream. That's what happened. I convinced my wife to take some money out of savings. I joined the Colonia Country Club. And I literally started doing presentations to the board of directors in the president's room. I would treat them for dinner and scrape up a couple of bucks, go to Staples, put this board together with graphs, show them what their rate of return is. And I started raising money. And one thing led to another. I quit my job and I didn't really know what I was doing, but I raised money in 3 tranches. It was $400,000, $400,000, and then another $600,000. to eventually close a loan with the New Jersey EDA and cut the ribbon on that project. It was just really, really exciting.

So this $17 million project was your first real estate project?

It was, believe it or not. I came into real estate very unusual in the sense that I didn't know anything except construction and engineering. So the quickest path for me to get into real estate was to get a property that I knew how to engineer, Build it as fast as possible and kind of figure out the real estate aspect thereafter.

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Well, your story is not all that unique, but it's often surprising to a lot of people. You had 2 master's degrees. Civil engineers are not the most poorly paid professionals around, and yet you were still struggling financially. That's not a particularly unusual story, but you realized that this just wasn't going to work for you. You went out and you started raising money. money. You'd never done a real estate project before. Whatever gave you the idea that you could go out there and raise $17 million for this real estate construction project?

You know, it's a great question because, you know, I don't know that I ever looked at it that way because it probably would have spooked me. What made me take the first step towards the development was learning about that there was a thing called a development fee and it was 5% of the total development. And I kept thinking, wow, I'm building this project. It's $100 million in New York City. I'm building it for someone else. He's paying himself like a big development fee. And I said, wow, if I could just get a, maybe a development project in New Jersey for $10 million, I could pay myself $500,000. And I remember trying to figure out how I could pay myself different fees in the process. So I said, well, if I pay myself 5% development fee, then I could pay myself general conditions to build it, which is usually like 8 to 10% of the construction costs.

So the construction costs, was about $8 million.

I figured, well, that would be close to like $600,000, pay for my staff, give me a little bit more salary. I was already paying myself a development fee. And then I was like, wow, I could charge a construction management fee too. So I'll get another 3% and then maybe I can get some on the financing. So I actually kept thinking about fees because I didn't know a lot about the real estate because I always kind of came out of that professional world where civil engineer works for a fee, An architect works for a fee. And I knew all about the fees, but I really didn't— hadn't understood the calculations of, you know, ownership. So when I went into my first deal, I paid myself a lot of fees, but my ownership was, I believe, at the end of the day, 10% only. It started at a little higher, but as I kept raising the money, I was deluding myself because it was my first deal and I wasn't quite sure how to retain it. I kind of was undervaluing myself. And that's how it kind of moved forward. And then I was like, wow, how am I going to finance it? And then I learned about the New Jersey EDA and realized that the New Jersey EDA only required 10% deposit, essentially, if you're looking at it from a residential perspective. In that case, it was 10% of the equity. So I figured $17 million, I need about $1.6 million. I can raise $1.6 million. Let's do this. You know, so it was probably more, you know, trying to put my arms and eat, you know, a 1,200-pound gorilla, but I was just taking like little bites at a time.

Well, I've heard that oftentimes that the way you move forward is just one step at a time. And yet, did you have any, any mentors? How did you figure this out that you could go out there? And I mean, you knew there were fees and what have you, and you knew that other people were doing this, but how did you find the path forward?

Yeah, I did. You know, I had some mentors. I, you know, I studied a lot. I read a lot of books. Dolph DeRoos was one of my mentors. He was the only, I guess you'd say, real estate authority that was writing books on commercial. I'd read a lot. One of my professors at New York University had wrote the Real Estate Development Manual, and he lived a few miles from me. I used to go to his house and just ask him questions about his book. I'd sit there for hours. His name was Jerome Alanick. And I would say, My number one mentor was a guy by the name, God rest his soul, God rest, John Norris. John Norris built Battery Park in New York City, which everybody's very familiar with. But before that, he built Canary Wharf in London, 2 of the largest projects in the world. And I was fortunate to work with him on MetroTech, which was a billion-dollar project in Brooklyn. He was hired as the man by Forest City, Bruce Ratner, the former owner of the Nets. And, you know, I used to meet him on the job site at 6 o'clock in the morning just to walk the 30-story building and just pick his brain, let him yell at me and stuff. And, you know, he ended up getting me a job as an SVP working for a major developer, which was 2 steps away from me going out on my own. And, you know, I'm glad you asked that question because, you know, those mentors, you know, saved me even though I put 125,000 hours of work into where I'm at today. They saved me a lot of time, you know, without mentors, you know, you could spend a lifetime trying to figure it out.

Well, what's an SPV?

SVP, Senior Vice President.

Senior Vice President. Okay. One of the riskiest real estate endeavors is development, and you jumped right into development. Of course, you did have the construction background. That's what you were familiar with. But even with that kind of a background, construction is risky. It just is a risky endeavor there.

Yeah.

And yet, you came out on top of that. You slighted yourself on the ownership perhaps, but because you knew the fee structure, you were able to make that a very profitable endeavor. So, from that endeavor, then you moved over to another development project and that was underway. And this had to be very, very devastating for you because Going from absolutely nothing to owning and controlling $17 million, 72,000 square feet building was certainly an endeavor. As much money as that sounds like a whole lot, you only had 10% of that. So in terms of entering the world of the wealthy, you really still had not entered that world as of yet. And yet you went off to Hawaii and sure enough, the World Trade Centers were attacked. And you lost a good portion of what you had built. And so you were devastated and lost, and yet it didn't really take you that long to make a comeback. Talk to us about that process of coming back and how you did it and where you came from, from that devastating point.

Yeah, it was a time where, you know, we had— at least I had to lean on what I knew best. I was I was fortunate to build a few substantial projects during that downturn that I had taken a hit on the real estate. So one of the things I was fortunate, as developments are brewing and getting started, I was always able to do some third-party construction management. There was a country club that we built out during the hard times. I did a geriatrics facility and then the facility actually started to generate some money. Stabilized. New York, you may have been talking about 2008, we took another crash. We lost $300 million in one day with Lehman. So we've taken the hit 2 or 3 times. On that one, it took me probably 2 years to get back on my feet just because I didn't— it was just like, didn't kind of know what happened. We didn't know if Lehman was ever coming back or whatever. And it took a while to untangle things. It was funny because I kept going back and by that time I had accumulated some of the retail on the projects that we had done in New York. And it wasn't like I had tremendous expenses to become financially free. I always said, $20 grand don't keep me from coming out of the driveway. And fortunately, sometimes I look back wondering, would it have been better off instead of doing condos where we sold off, whether we had more rentals? But it has worked out well in the sense that we've had some ups and downs until we accumulated. And now we're still doing the development. It just took a while. But yeah, in 2000, probably, well, it was '08 to '12 or '13, I was just doing third-party stuff. There was really no real estate investing. Then '12 started to open up. By '14, I was back in the city. We did like 300 units, which is other developers. We reduced the risk by co-developing. And after doing that, I had a concrete business for a short time. And then I just decided I wanted to get out of New York for a while and do some things. I had opportunities in Jersey and trying to spread out nationwide. There was an opportunity I had with a company, Flipping USA, that was founded. That was a journey that helped me write my book to prove out that the Modern Wealth Building Formula worked for residential also. And it's been a little bit of a roller coaster, but Ultimately, I forced myself to stay on track because there was times where in 2008, I was almost contracted by Stewart's Root Beer and was going to go totally out of real estate into beverage. And then there was another business venture. So I just kept saying to myself, stick to one thing, stick to the real estate, get back in real estate, build a little educational company, try to teach, move people forward. Things will get better. It took a lot of, you know, personal development and, you know, mentorship, you know, because there was some tough times here. We were getting beat up.

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Yeah. Well, you, through these times, you developed what you have called the Modern Wealth Building Formula. So, take us through the formula.

Yeah.

The formula, you know, essentially, you know, is a bit of a sports analogy. You know, there's a pregame warmup. Where you really have to get clear on your goals and the lifestyle you want and get clear on systems and what you want and the mental mindset, because that's half the battle. And really getting clear on where you're at and where you want to go. And the pregame is key because that identifies where you're at in the lineup. For example, if you're a leadoff hitter versus a cleanup guy with a little bit more money, a little bit more experience, If you're a lead-off guy in the lineup, you may be a beginner. So the formula starts out by getting very, very clear and concise and spending a little time and some exercises on mindset acuity, goals, and understanding investment criteria around syndication. And then it dives right into a system essentially that helps you find, fund and facilitate profitable real estate deals in any type of market where you could syndicate them and use other people's experience and other people's money and create a win-win situation for yourself and others. And what I had found is there's a lot of people like me and like-minded like me that want to get into real estate, don't have the time where a person who chose to go into real estate provides them an opportunity. And if you could, you know, if you serve with integrity and you deliver, you know, you can create a nice little business around the formula because, you know, syndicating real estate is a business in itself and was kind of, I guess, the offshoot of the syndication that I did before I really knew what the word syndication meant. You know, I was— I just put a group together and There's about 20 guys and I asked them for money to come to find out that, hey, that's what Gene Trowbridge is teaching and it's a business on syndication. You know, that's how it started.

So your formula is really that of developing a mindset, setting goals that are clear and well-defined and working the criteria. And then it is find and fund and syndicate. Is that Did I get that correct?

Yeah. Essentially, and in summary, I probably didn't sum it up, is through that process of finding funding and facilitating real estate, skip the syndication word because it makes it too complicated. There's 30 steps to what I call real estate mastery and the Modern Wealth Building Formula. The punchline is how to master real estate investing. And it's just a different formula in the sense that It's modern from my perspective because of the top-down thinking and how I figured it out without really having the real estate experience, coming in with a builder's background in engineering, which to me says that anybody could really do it. Because if the person was an accountant, he could have hired a builder, he could have hired an owner's rep. And that's what I teach people now, that you don't need to be a builder, you don't need to be an architect, an engineer to put a group of people together to make money in real estate. It starts with a conversation. You could create any possibility through language and communication. And until I read that paragraph in a book on syndication I found in the Rutgers library by mistake one day, I was in Newark, get my transcript because I was going to take my professional engineer's license. It said a syndicator could be a banker, a lawyer, an accountant, a builder, a social worker. And I was like, wow. I can put a team together. Let me give this a shot. I played a lot of sports. So I guess it was the sports and the teamwork that helped me a little bit because not to say my parents were loving to death, but they would just say, go to college, study. And you got done with this class. I'm like, okay, what's a parabola going to do for me? Or what's— I was studying economics, supply and demand, but I couldn't apply it to making money. At least I didn't know how to apply it to making money.

Tell us a little bit here about the book. And once again, give us the title of the book.

It's The Modern Wealth Building Formula. How to Master Real Estate Investing. And I mean, it covers every aspect, find, fund, and facilitate, but it talks about in funding the capital stack, all the different sources, how to evaluate the market, How to present yourself to unlimited funding. It has the 15 unmistakable myths. You know, Jack Canfield put his name on the front cover. Dolph DeRoose, the commercial real estate authority, wrote the foreword. And, you know, I really wrote it to pay it forward. I'm not going to make any money off the book. I hope you guys make a lot of money in real estate. But yeah, if anybody ever wanted to, you know, find out more about executing the formula, you know, they could— My website, easy to get in touch with.

And what is your website?

It's kenvanlieu.com, K-E-N-V-A-N-L-I-E-W.com. But we give free strategy sessions for people and I actually do them myself. I'm not in the, I guess you'd call it informational marketing business to make money. So I do coach maybe 20 students a year just because it allows me to fulfill my contribution needs. And I get to grow a little bit just around things that I'm doing personally. And that's what we're doing. We have this Global Real Estate Investment Academy that's kind of an offshoot of my company, Global Real Estate Strategies. And real excited about breaking ground on the CVS. I hope we could break ground this year because you know how planning boards are. They're taking July off for vacation. So that's not what I wanted to hear.

Yeah. So the best way to get in touch with you is just to go to your website, kenvanloo.com, and there you can get in touch with Ken and set up a free strategy session. Is that what you said?

45 minutes.

45-minute free session. That's a deal and a half there. So viewers and listeners, take advantage of that. Yeah, I'll have to do that myself here.

Yeah, I'm— I listen With what I call level 5 listening that my partner Sean Callagy always brings up, where we listen for how we can transform and give that person more power, freedom, self-expression, peace of mind. And I call them impact calls because my goal is when that person gets off the phone that they've been impacted by Ken Van Leeuwen in a positive way so that they can pay it forward.

Excellent. Some very good value there, Ken. Let's go into our last segment here. Share with us, what are you most grateful for today?

You know, I'm most grateful today that my parents, 87 years old, young, are still with me. And mom's in the hospital right now, but I had a wonderful weekend. We got her into rehab, and I'm so grateful. I mean, it just almost makes me cry immediately that, you know, I don't want to join that club. I don't want to lose my parents, you know, and I'm so grateful. And, you know, right behind that, I am so grateful. Um, this week I was married 30 3 years to a beautiful woman, Terri Van Lupe, who I met 39 years ago at Glassboro State College when I was failing, got ready to fail Calculus 2 for the 3rd time, and she saved my ass. And then right behind that, my 3 outstanding children. But I'm grateful for so many things today. I write them down every day. I'm in tremendous health at 59 years old and just have everything that I want. I thank God every day. It's just a lot to be grateful for. And I'm grateful to be on the show. I appreciate you today. And it's just been a pleasure.

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Well, we're certainly glad to How are you putting your success as an investor and entrepreneur to work to create universal wellbeing and abundance for all beings? You've shared some of those things, but are there other things you'd like to share with us that you're doing?

Yes. You know, I think, you know, some of the stuff that I focus on is helping others, you know, in the sense, just mentally, I've noticed, you know, in the last year, you know, people are challenged just with going on in life. I set an example, you know, with my physique, you know, in the sense you are what you eat. So, you know, I'm always working on my health. At one time many years ago, I was at that Life Mastery event, I was 246 pounds. I weigh 172 pounds right now. I'm in pretty good shape. My metabolic age was 36 years old last week when I stepped on the scale, some funky scale they have. So I'm always trying to help people around mental health, and I believe health and wealth are very connected. My dear friend, Dr. Roger Sahari, and I are in discussions about writing a book on health and wealth. I just recently, like last week, put together the Global Real Estate Investment Academy, which we're going to be launching officially in the near future, and helping out a lot of other young entrepreneurs that want to get started in coaching, doing some stuff with my church and community, and just focusing on giving my time In so many ways that I can. And then probably the biggest thing is my 2 daughters are getting married, one this September and then one next October. And that's been real big. And my son is a US intelligence Marine officer. He was almost a major. So my kids are just pride and joy also. So that keeps me busy all the time, really busy. And I just got 28 acres in Little Egg Harbor, New Jersey. So another big project.

Oh, wow. Yeah. What are you going to do with that?

I spoke to the mayor and he said, Self-storage, flex office. I'm going to actually go down there this week. There's a Wawa now across the street from it, and I haven't been there in a while. It's next to a golf course and a big housing development, and we're going to figure out what the highest and best use is. And I know there's some CAFR requirements, which means we need a little bit more impervious material, impervious areas. So we're going to put our head to the grindstone here and figure out what What's the best to do?

How are you managing this astronomical cost, increase in cost of materials?

You know, fortunately at this moment, and I've been— I have some of my team looking into it. Fortunately, we are like in between projects and getting ready for the CVS. And what I have my team looking at is to see what we could prefabricate and build offsite, making a list of Materials, because besides the pricing, there's also some lead time issues. So I don't know how bad it is yet, but we are taking actions with respect to lead times, cost, talking about buying material and storing it. We literally just made our submission and they sent back a 20-page letter. So for the last 2 months, I've been answering engineering questions and trying to get to a point where the application is deemed complete because they won't even have the hearing unless it's deemed complete. And literally last week we got the notice. So my first thing was, oh wow, now I got to figure out what's going on with all the construction materials. But my partner says we can get pretty much whatever we want. I think there's a bit of a gangsterness going on there. People are trying to control things, but there are shortages and things like that. So we'll see. That's about the best answer I can give you right now because it's a little bit of a tale of the tape.

Right.

Yeah, a lot of uncertainty there.

Yeah.

Well, imagine that you have come to the end of your life, and as you lay on your deathbed, what will you look back on with your greatest sense of joy and satisfaction?

Honestly, have to look back on, um, you know, meeting my wife. I, I was a good-looking guy and I was captain of the football team, so I dated a lot of girls. And, um, when I met my wife, I, you know, I knew I was going to marry her. And I remember the day like it was yesterday. In the hallway, I saw her in the door. She was wearing this lab coat, her hair was up. I was like, yeah, she's the one. And happened to be the same one in calculus class that was sitting in the front row, and I didn't put two and two together. And then she ended up getting me to pass and turn my life around there. So I'm just going to wish that I probably spent more time with her and I was nicer to her. Fortunately, she's still still alive. with me after 33 years. So she put up with me, but, you know, very, very grateful and thankful for that today, this week also.

Well, Ken, it has been a pleasure having you today. Thank you for sharing your life and your ups and downs and your phenomenal success. Thanks for being on the show.

Well, thank you very much.

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