Dallas Engineer Walks Away from 6-figure Salary to Buy Apartments-Sandhya Seshadri || Ginny Bolling

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Hi, this is Ginny Bowling with Pivotal Real Estate Investments and I am going to be interviewing Sandhya here. Did I pronounce that correct?

Yes, you did. I'm Sandhya Sashadry.

Yes.

Thank you so much for the honor of being on your podcast.

Thank you for being here. And so tell me what your name means.

Sandia means dusk or twilight in Indian language.

That's terrific. And that tells us you're from India.

Yes.

Okay. And so you now live where?

I live in Dallas. I've lived here for 32 years. I moved from India to Dallas and I've lived there ever since.

How did you move here with family?

I moved by myself. I came here first as a student, then I got married and I've lived here ever since.

Very good. And so tell us what you do.

Right now I'm a full time apartment investor and syndicator. But in my past, like a lot of Asian geeks, you know, I have a strong math background, so I have a degree in electrical engineering. I came to college here. I went to Southern Methodist University in Dallas. And then soon after college, I got hired into a local Fortune 500 company where I worked as an engineer. But while I worked there as an engineer, I realized that all the business types were making all the decisions and telling the technical types like me what to do. And I wanted to understand how they made their decisions. How do they choose one project versus the other? So my company was kind enough to send me back to school part time, evening, weekend kind of MBA program where I learned the business side of working for a large company. And then I moved over to the business side and more of a marketing and then running programs, kind of lower role. So my most recent job with them was to run an $80 million project with a 250 person project team across several countries including Israel, India, Taiwan, et cetera. So that was a fantastic experience. But then, you know, life happened. I had children and it just didn't make sense for me to continue the corporate ladder. But I'd also formed investor clubs, et cetera, from my network, from doing my mba. So I went full time into investing in the stock market after that. And then I stumbled upon multifamily only because I'd always wanted to have something to do with real estate. But single family just didn't make sense because I didn't have a handy person's background and I didn't want to be called on Thanksgiving day to fix a leaky toilet kind of thing. So because of that, I stayed away from single family. I found that the margins also were pretty low. You know, you only made 3, 400amonth. Maybe you'd have to sign a recourse loan, put 20% down for mortgage and things like that. That doesn't appeal to me. So when I attend a weekend seminar where I heard about the large scale multifamily, you know, you own 100 plus doors kind of property, then you can afford to have on site staff who take care of property management, the leasing, maintenance, all the, you know, fixing leaky toilets kind of stuff, I wouldn't have to do that. Somebody would take those calls, somebody would make sure maintenance takes care of it. And I'm an asset manager, just like my program management, project management experience in the corporate world. I would look at monthly financials, I'd have weekly calls, we would execute the business plan, et cetera. And that was very appealing to me. So I joined this mentoring program. I got together with people who had done exactly what I wanted to be doing. Right? You need to be in a place where you can learn from other people who are a few steps ahead of you, doing exactly what you want to be doing. And that's where I found partners initially. I started out as a limited partner or a passive investor where I don't have all the headaches of a landlord. I invest some money. I invested the retirement money I had from my previous corporate world to learn this business. By investing passively with experienced operators, I made sure all the deals were in the area, like in Dallas, which is my market, where I wanted to do deals. That's how I learned the business from them. And doing that, I established relationships with them to where I ended up being a general partner myself in a few months, where I syndicated my own deal. And that's how I've launched ever since then. So my first deal was back in 2019, you're guessing. Oh my gosh. Now it's been three years and it's been fantastic. And so I do this full time. I'm in Dallas, I know my location and I know what I need to do as a strong operator.

And we were just talking off camera.

About she just closed on a deal. And so tell us a little about.

That if you would.

So that deal is 196 doors. It's a $25 million level deal in just generally that price range. The deal is located in Irving, which is an excellent submarket within like a 10 minute drive of the Dallas Fort Worth International Airport. It's a very well established submarket of Dallas with a ton of variety of industries. Irving Las Colinas is that area where you've seen all the major PGA golf tournaments happen. You know, Caterpillar was one of the big companies that recently moved its headquarters out of Illinois, where it's been for over 100 years, into Irving. So there's just a variety of industries and jobs and the population, income growth, all of that is explosive in that area. So you really want to pick that for your market. And so we, between me and my partners, we have 500 doors in Irving and we just acquired another property on the same street. That's terrific, like back in July. So it just made sense to acquire more. And really we therefore, you know, it's not guesswork when we say, oh, we can increase the rents by this much or we can add this amenity and the tenants will really appreciate it because we're already operating properties right there in that market. So none of it is guesswork. None of it is based on data that I download from the Internet. You know, it's actual data from owning, investing, visiting these properties on a weekly basis. So that minimizes your risk a lot, right? It does.

And that's what I look for in an operator. And my appraisal background and all that gives me knowledge of a lot of different databases that help me cross check things. But I certainly look for operators that already have a presence in that market and so that's really terrific. So tell me about who are your typical investors for you?

My investors are anyone who can afford to have their money relatively illiquid, meaning you're not depending on the money from this cash flow and this investment to pay your bills in the next six months. And it's not somebody who needs this money back in two years because our hold period typically is in the five year range. Now, it's true that I've gone full cycle on a couple of deals where, you know, we bought it, we executed our business plan and then we sold it. So we call that a full cycle and we've done that in less than 30 months, which is two and a half years or less in the last couple of deals. But there is no guarantee that we'll be able to do that again in the future.

It's been a very hot market, right?

So we tell people, plan for your principal, your money, not to be back for about a five year period. And as long as you can be okay with that, that's important. We prefer accredited investors who have a net worth. You know, according to the SEC definition, it's at least a million dollars in net worth excluding their primary residence, or at least $200,000 as an individual in income the last two years and expected to do that again this year and in the future. So we prefer highly sophisticated investors, meaning they understand the risks. This is not their first ever rodeo of doing an investment. They have traded maybe stocks or commodities, crypto, something, right? So they have investment experience. They understand they have a sophistication that's truly important. That's a must for every investor, whoever wants to invest with us. And then the accredited is always a nice plus because then it means that our minimum investment tends to be 50,000 per deal. So we want that 50,000 not to be their entire life savings, right? We want that 50,000 to be a small fraction of their total savings. So let's just say that they worked for a decade at a corporate world in a company and they have all this retirement money to the tune of a million dollars. It makes sense for them to roll that over if they no longer work for that company, to roll it into a self directed IRA or a solo 401k. And then out of that million dollars, investing 50,000 in one of our deals, that makes a lot of sense because it's still a small fraction of their total SA terms of the actual profile of a person. It's, you know, I could say engineers love discussing things with me because they love data because it's relatable as an engineer. But business women love to invest with me because I'm relatable. I'm an entrepreneur as a woman without any other, you know, help from a husband or anybody else coming up and relatable so I can tell them about visiting my properties all the time. So it's anyone who I guess has the sophistication that's the most important thing of understanding. And who loves real estate, right? Who believes in the capacity of real estate, knows they're good markets because you know, Dallas obviously is one of the greatest markets for multifamily, especially in the past decade. And that's pretty much it as far as the potential investor.

Right, right.

But we want to definitely have a conversation with them. Right. Make sure we are a good fit for each other. Then we want to have further discussions. Then I send them examples of the past deals I've worked on. So it's a process. It's not an, you know, oh, here I am selling some girl scout cookies. Buy them, it's 20 buc or 10 bucks or 5 bucks.

Right.

It's not like that. This is a huge transaction. So we take time to establish that relationship. And like for me right now I've just closed on a deal. I won't be having another deal for several months. So this is a great time to have those discussions and make sure we're a good fit for each other. That's so important because I'm looking for not just a one off, one time investor. I'm looking for someone with whom I can deepen those connections. So as an example, I had somebody who invested in my first deal back in 2019. Right. And he invested 50,000 in my first deal. Well, that deal has gone up full cycle. And in my most recent deal in March of this year, March of 2022, he invested a million dollars in my book, which is insane. I couldn't imagine somebody trusting me with that kind of money. But that's exactly what he did. So, you know, I'd rather have deep, longer built in relationships, connections with people rather than a one off, hey, I'll just try this once and I'm done. You know, kind of people, so people who believe in the real estate.

And that's what I'm doing. It's like it takes a village.

And ideally you can keep, rinse and.

Repeat, you know, work with the same people. That way you don't have to start over with vetting a team and getting to know a new market. There's certain select markets that we're aiming for as well.

Yeah. And one other thing I want to say about people and their funds is a lot of people think I don't have that kind of money. Until you realize, look at your retirement account, you've been trusting your 401k to the stock market. And I don't know how 401k is doing, but my money, like my husband, is still a W2 employee. His 401k has tanked in 2022. It's done very Poorly. Right. So that's the money that I'm talking about that you're not counting on in your immediate future, but you have at least a 5, 10 year kind of horizon. That's the kind of money I would strongly encourage you to look into real estate for the money that you don't immediately need in the next two to three years, but for which you want to build wealth long term and you believe in the power of real estate to do that.

So I know you can't say exactly how those two that you went full cycle on performed, but can you give us a benchmark of what kind of performance you got?

Yeah, we generally project for a five year return on our deals is that we will double your money. That's typical. But you know, every deal is different and it's a projection based on the data we have available at the time of the offering and that varies day to day. And I can say that both the deals that we went on full cycle on have exceeded those projections in less than half the time. So kind of returns. But there is no guarantee again that a future deal might do just as well. So you really have to do your due diligence if you're betting on any kind of returns, et cetera. These are all speculative investments, whether it's this real estate deal you put your money into a stock, etc. These are all speculative investments. You want to consult, you want to make sure you're sophisticated to understand the risks. You want to consult with your lawyer or your accountant, whoever, other professionals you need to. Because this is just a conversation between me and Ginny, it is not to be construed any kind of financial advice. We want to make sure you understand that.

Yes. Anything else you'd like to add?

I would say that if you've never looked into real estate as a form of investment, this is a very good time to look into it because the stock market definitely has failed us. It's definitely depleted our savings and reduced our investment money in terms of our net worth has decreased between me and my husband this year because of the stock market. So if you haven't considered real estate, definitely do so. Give yourself a deadline. Don't just say, oh yeah, I'll think about real estate. And a year from today, you're still in the same spot every month. You should have a deadline to say, in 30 days I'm going to figure out these three questions and get answers to them so that I'm an informed person making a yes or no decision rather than I'm just going to drift. And I have no new information today or a year from today. You know, set yourself some deadlines, answer your biggest questions, learn some podcasts, learn from books and make a decision that way. It's an informed decision.

One of the funniest things that I relate to is it's in football, is you always hear you have to have a goal. What really resonated to me is goal posts. And unless you run through them, you're just running around on the field. That's right. You're not getting anywhere.

That's right.

So go through the goal posts and monthly is a great benchmark to use for yourself so that you're sure to make progress. And anyway, so thank you so much.

Thank you so much for the opportunity. Really appreciate it.

Well, I hope you enjoyed that. If you did, please like, share. And most importantly, if you want to know when an opportunity comes available, do register on pivotalrealestateinvestments.com so we can get in touch with you. It's important to have a conversation. Likewise, follow us on Facebook and Instagram. We'll have brief things we pass out time to time.

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