Investing in Medical Office Real Estate with Flint Jamison

Are you one of the many busy professionals working in offices day in and day out? Do you wonder how some people grow their wealth fast, retire early and play on work days? Well, you're in luck because Ginny Bolling hosts this show Pivots of Prosperity where she interviews people that can do just that play on work days. Many guests have become financially free. She also interviews people that are on their journey and people that are in support roles like attorneys, contractors, brain brokers and others. Commercial real estate is the common element. She is on a mission to be sure. Busy professionals know they can own substantial commercial properties too, like apartments, self storage facilities and others, and not have to do the work managing them. Passive investing is the key. Syndications are the typical method. Tax write offs are some of the biggest rewards. Ginny and partners find the deals, build a strong team and business plan, then offer the investment opportunities to passive investors. New episodes are released every Tuesday at 12, so watch for new releases. If you want to get involved, let us know. You need to get pre qualified to hear about most deals. See the show notes for contact information.

Hello, Hello. Jenny Bolling here with Pivot to Prosperity brought to you by Pivotal Real Estate Investments, where we help investors build wealth and income through commercial real estate that also improves communities. Today we have Flint Jamison on with us. Flint, thank you for coming.

Thanks for inviting me, Jenny.

Yeah, well, terrific. I, I have been able to talk with you a bit and get to know you a little bit before we start recording, which is always cheating because then you don't necessarily remember if you really captured everything. And we're going to try to do just that because you do some interesting things. And so yes, let me have you go ahead and introduce yourself in this case.

Yeah, so I am formerly an aerospace engineer, built airplanes, actually one right there behind my shoulder, the 787 I worked on way back in the day, designed wing structure on that. Then I went on and did some military aircraft. I became a program manager running $100 million programs, modifying aircraft for the Air Force. And then I got into real estate. So Yeah, a quick 30 second history of myself. I started out with a duplex 1600 miles from where I lived and then I got into commercial real estate pretty quick after that. So I, I wouldn't say it, it moved quick, but I definitely pivoted pretty quickly from that residency.

You get points reading that word.

Yeah, just going from in 2018 I did the duplex and then in 2021 I started doing commercial actually successfully. In 22 I got my first Property.

Great. What was it?

What was it? It was a. So that one was a 104 unit, class B minus C plus ish. In Augusta, Georgia.

Okay.

That's a value add multifamily.

And you live where?

Right now I live temporarily outside of D.C. in Virginia. But I am from Colorado. I don't like to say I'm in Virgin you. We hope to be moving back to Colorado soon.

I didn't expect you to say Virginia. Where in Virginia are you?

Outside of a town called Manassas. That's the biggest city near us, But I'm about 45 minutes west of D.C.

Did you go see the Battle of Bull Run Fields?

Oh, you know what? I'm really close to Bull Run. That's funny. Like the Battle of Manassas. That's the big one. That's it. Right where I live is in Bristow. And so there's a Battle of Bristow as well, just a couple miles down the road.

So I grew up in that area.

Oh, no way. Okay.

More towards Dallas Airport.

But yeah, it's interesting being from Colorado and living in Seattle, working for Boeing, then coming out here, there's. There's so much more history. Like, it's weird. You're just driving down the highway and, oh, look, there's a Civil War battleground. That's just that that's not normal to me out here. It's very normal, but it is.

Yeah. Well, since you're right there, have you done any touring of the. You know, dc?

Yeah, yeah, Yeah. I. I have family members that work in the Capitol building. So I've had VIP tours.

Nice. Yeah.

And got to spend the 4th of July on a balcony at the Capitol.

Very cool. Very cool. All right, so we digress. So go ahead, though. So you got your first one in 2022, and I think you've got several properties now, right?

Yeah. So I'm up to somewhere eight or nine deals, maybe seven properties. Actually, some of them are multifun portfolio. So the closest number I can come up with that I. Because I haven't counted up in a while is I'm strategically partnered on about 2400 units. Some of those were like a three. Two of them were three property portfolios that investors got into. So it's a nice diversified play for investors.

Yeah. And when you're talking portfolios, I see how you got where you are in some respects, maybe because different people play in those fields because you've got much bigger dollars. And so. Yeah. Tell us about what it's like to get involved in a portfolio.

I think it's great because in large part, one of them has three properties, two different states, three cities. So you got Houston, Tucson and Phoenix. One of them is a brand new off the developer class A. The other two are. One's a class B value add. The other one was a class C to a class B conversion. So you think of a single investment, not only are you diversified over cities and states, but you're also diversified in asset classes. Plus the operators were different too. So any of them has challenges. You got the other ones to balance it out. So I think it's just for a single investment for an investor to come in with $50,000 and get. I think it was like 700 units. I mean, that's a, that's pretty. That's a nice diversified investment. It is.

And underwriting that is tricky though. Did you get involved in that very much or. I know you're more on the other side, but.

So I was a fund to fund on that. The primary fund was a $30 million fund and they were actually my mentors. So that, that's how I got presented the opportunity. That was my second capital raise. That was my second opportunity for investors was this big portfolio deal. And it's all because it was my mentors that were running that primary fund. And so, yeah, they, they have not only a huge stake in that game, they were the KP's. They're also partnering on asset management. They're trusted partners and operators. So, yeah, I didn't get involved in the heavy due diligence of each individual operator because that's what the primary fund and my mentors were doing. I just needed to make sure that the numbers made sense for me and my investors to jump in on the deal and that I liked who the operators were because in our world, as you know, Jeannie, we're, we're heavily connected and we can always go ask a friend if they know who this operator is, if they have referrals and like them. So we kind of did that stuff. We didn't necessarily get into spreadsheets and check to see if their insurance quotes were valid.

It's different in so many ways because then you have investors that, that want to know the detail and others that are more versed at depends on who your, who the KPs are, of course, to a large extent too. But yeah, that's pretty cool to have that as your second deal too. Yeah, very cool. Yeah. And so now tell us about what you're doing these days.

Yeah. So let me I guess just stepping through. Me as the capital raiser now partnering with strategic operators who are experts in their niche. My investors get a wider opportunity to diversify into unique things as they come to me. And, and I vet operators. So I've, I've done multiple built to rent development opportunities and then I'm shifting into more cash flowing deals. So some of that was multifamily. Now I'm doing medical office buildings which we'll talk about here in a second. And then somewhere in the middle there I got randomly thrown from another very close, a syndicator friend who is friends with a billionaire who's doing a startup. So this billionaire is going round two and they're going to raise some seed, seed funds. And I got invited to not only invest, which I did, then the following year I got invited to raise capital with my investors into that deal as well. So I'm getting just in this world it's so much fun because I get all these, these unique opportunities that can be really exciting. And now like the medical office building came up. So we're buying a portfolio of dentist offices with the goal of where it's about 8 to 10, we're going to cash flow those for three to five years. We get about 8% plus on the cash flow. And then in three to five years REITs are looking at us because we're going to have about 10 million no I revenue a year and that's when REITs become very interested. So we'll package it up and sell the REIT the whole portfolio for good gains on our end.

Right. And as we were talking, that's a more and more popular business model. And so I can totally get what you're doing now when you're, what are you actually doing when you buy them? Which types of tasks are you taking on from the office?

Yeah, so I'm going to be doing tasks on the back end and to be honest, a bunch there's, let's say five of us co sponsors. We're all going to divvy up the tasks. At this point it's too early to divide up the tasks. We haven't gotten there and things can shift in a month or two. But right now our primary operator is we should be closing on the first four properties now. Ish. And then we'll do a second tranche raise to buy another four to six as needed and then we'll close up that fund. Then in the summer we're going to Open Up Fund 2 and that's where I think we'll Switch from the co sponsor into more of a fund to fund structure. But for this first one we came in as co sponsors.

So it's considered a special purpose vehicle right now.

Yeah, it's, yeah, it's just a single.

Subscription set, single entity. Why dental offices?

Yeah, so this is, this is the best part. So this is my first triple net. I've always wanted to get into like industrial triple net. And this came along. The particular individual behind the scenes here who's the expert, had built a company with him, him and his dad, his dad's a dentist now, retired. But they, they knew that dentists were not necessarily good business owners. Like dentists are just better with their practice and they're not good with the administrative stuff. And so he decided, you know what, I'll create a consulting company and I'll run the businesses for the dentists. Became so successful he was doing 100 million in revenue to the point where he sold to private equity. And then, you know, when you're in private equity, you have to be the CEO of the company as they acquire you for X amount of time. Well, he's out from underneath that now and he's turning around and he's like, you know what, I just want to buy the real estate and not run the businesses. So what I think is the most important thing here is when you go to buy medical office buildings, particularly like a dentist, you're putting them under a triple net lease. Triple net leases are not simple. You can win and lose on a good or bad triple net lease if you set it up poorly. And the goal of a triple net is your tenant is paying maintenance, insurance and taxes. But what maintenance like you have to divide out is the H vac system on them, is the roofing on them, it's a parking lot on them or me. So that all gets shaken out. And on top of that, you want to make sure that that dentist office is also a healthy business and it's going to be able to pay its bills because you're signing it on a 10 to 15 year triple net lease. So he knows how to underwrite dentist offices because he was doing that as a, as a consultant running businesses. He sees the numbers very quickly. He knows when they're in, in a challenging spot or not. So about 75% of the underwriting or due diligence of, of these deals is, is looking at the business and then you can look at the real estate piece beyond that. So it's kind of two phase due diligence. And I'm not the Expert to underwrite a dentist office. I'm sure I could look at numbers, but I'm not going to see what he sees. So that's where it's like leaning on these experts that are an expert in their niche is, is a good play.

You have a great expert on board.

Yeah, yeah, yeah.

That's, that's really good that he, he knows dental practices that well.

Yeah.

But super well. And there's lots of them. There's so many dental offices.

Right.

And AI is not going to replace that.

No. You can't get your. And, and zoom. You can't get your teeth cleaned over zoom. So it's.

Right.

Great. Yeah.

So true. We looked at one that was retina practice.

Like cataract surgery or just, just optometrist.

There's all kinds of retina issues. So yeah, I, I was concerned about how healthy can that business be. Right. They're pretty healthy. I guess so.

Yeah.

But I'm not that I'm an expert, but yeah. There's so many different practices out there that especially as us baby boomers get really flooding the medical offices.

Oh, you know what the other thing that's really interesting about this is you think if that dentist. The biggest failure point is the, the hit by a bus scenario where the dentist, it's no longer able. He, he knows how to put another dentist in place, a traveling dentist or something. He's got. There's an actual name for it, but a dentist that can come in, keep the practice going, keep the employees employed and keep the, the clients still flowing through until he comes up with a permanent solution. So as I think about this across the board, if you think industrial triple net or like retail strip malls, the Laundromat goes under. You're just like, well, I just got to find a new tenant where in this scenario we're in a very unique situation, especially with the operator that we can keep, keep these things cash flowing. And he knows how.

Yeah, yeah. I would say you're, you're more secure in, in every way.

Yeah.

That's interesting. That's really. And how long have you been. Well, you said the first one you're getting ready to close on, so we're getting ready to.

Yeah, this is fun ones. We're. Yeah, we're closing on the first four buildings. I actually haven't heard from them this week. We may have already closed on one or two of them, but then we'll. He's got Lois out for the next wave.

Interesting. And any geographic location in particular?

Not necessarily. I mean he's he's got his metrics for, he doesn't want to be super tertiary. He wants to make sure the certain market size is big enough. But beyond that, when you set up a triple net lease, the asset managing is so easy because you don't have to, I mean your tenants in place for the next 10, 15 years and they're maintaining it. So you're like I like, I don't necessarily need boots on the ground, I don't need to visit, I don't need to be there, I don't need an on site property manager. So it makes it a whole lot easier to find, to spread out and.

Find the deals for them in scale a lot faster. Interesting. And so, but then, well so for instance, the business that we were talking about, that I can't say right now, the goal was to take some of that back office, the billing and some of the admin off of the staff so they could concentrate on other things. The actual work, for instance. Is that the model that you guys are using too?

Yeah, we will us co sponsors, we'll support on, on various tasks throughout and likely to come too because there's going to be a fund two and fund three. He wants to keep this a rolling wave so we'll likely jump in there and help out in various areas because we're all pretty excited about this opportunity and what it can be for the future.

What do you think it does for the patient? Does it help or hurt or make any difference?

No, it's relevant to patients. What's interesting with dentists is some of them are actually owned and operated almost like a franchise model under private equity. There's a lot of dentists that are, that are under a private equity umbrella and we could own just the real estate. There's others where I would say this is more often the case where you have a dentist that wants to expand his practice but he owns the real estate he's in or she and they want to liquidate so they sell off the real estate and then they use that, that cash infusion to go buy another practice or go expand their practice so that they can have multiple offices. That's. That seems to be more often than not the reason why medical professionals will sell the real estate that they own and turn around, do a triple net.

Yeah. And I think I kind of blurred the lines because I keep thinking that you're, you're buying practices but you're just buying the real estate.

Just the real estate.

Yeah, yeah. That makes a difference, right? Yeah, yeah. Very exciting. And so and the idea is then to ultimately get up to the 10 mil noi.

Yep, 10 mil noi. And REITs become very interested and want to buy up that portfolio. So.

Which is institutional money, basically, right?

Yeah, yeah. So we're looking at, I mean, an exit of a 25% IRR if we sell in year three.

Yeah, yeah, that could be sweet.

With cash flow out the gate at 8%. So it's good, right?

So, yeah, we try to explain to our investors how little they have to do for such great results. And as you know, sometimes it's a struggle because they aren't exposed to this kind of thing already. And so they think that can't be legal or that can't be. Right.

Yeah. Or that's a pyramid scheme or a Ponzi scheme. Like all the things come out when you're. Yeah, when. And I get it, when you live in a world where all, you know is the stock market and the s P does 8% over or 7% over 30 years, you think that, oh, 10, you're doing really well. Then all of a sudden, real estate, you're getting 15, 25, 35. People are doing 35%. And then that's like, it just naturally raises those, those red flags and people start assuming things.

Yeah, yeah. And if you can help them research it, it makes a big difference. What do you do to help your investors to understand if you've got somebody newer?

Yeah, you know, I like to give a tailored, tailored educational experience because people come from all different walks of life and knowledge, but in large part, I'd say go read this book. There's a book by Brian Burke. I'll just mention it. I tell everyone to do it. It's called the Hands Off Investor. It's. It's a. He writes a book explicitly for investors to understand what we do. It's our business model who make how we make money, how to underwrite deals as a. And how to evaluate deals as a passive investor. That's typically my go to. But I also have videos and stuff on my, on my website.

Right. Yeah. Yeah. Well, good. Well, very good. Well, we need to wrap it up here too. So let me ask you the big question here that I ask everybody. Is there a pivotal person or event that brought you either to where you are now or is pushing you towards something in particular?

Yeah, I want to say my pivotal event was a giant mistake I made. I fell forward, at least. I. I tried to do. Partner up with some people and do a small 23 unit in Colorado. And long story, Short it failed and we lost earnest money and I lost a bunch of money out of my pocket. Through that I figured out why we failed and I as I immediately turned around, unlike my other partners, immediately turned around and hired a coach. And through that coaching process within three months I had got invited on to that first 140 unit deal and then from there I just scaled and that, that, that coach I hired was subsequently the second raise on that three property portfolio fund to fund. So yeah, you never know. Just, just don't quit. Yeah.

And you know that was one of the things too. I was running a goal setting thing last night and just trying to tell people, you know, especially if you've been in real estate for decades, I, I and all that and I was like do I really need to pay to learn about real estate and yes you do. It is so different depending on what aspect you're doing. Right?

Yeah, yeah.

I was very, and I have mentors now and whatnot too. And, and it's, it's very, very important to realize that if you want to be like that person that the best thing to do is get a mentor like that person.

Yeah, yeah. And it'll accelerate. Yeah, you're going to pay money but you're going to pay money to move faster.

Yeah, it works. It does work. One of my things though is I don't like to be a copycat. So that's they tell you to copy them and. Yeah, yeah.

But yeah, yeah, I have the same opinion. I started out being the copycat because I was like oh this is easy. You just copy the systems and, and then now, now I'm taking a much different approach.

Yeah. Yeah. Well good, well so and do you want to give some, some overview of where you want to go or you, you into 506C or something right now that you can talk?

Yeah, I do both 506C and 506B and I'm going to continue probably doing this medical real at that point. I mean I've also done these, this, I've got potential for more seed investment on startups with not two dudes in a garage. These are, these are very seasoned people that have been around and so I, what's interesting to me is I get opportunities across the board and I don't jump on them all but my investors get to see a very unique set of investment opportunities. So yeah, if you're, if you're interested you can go to vestascapital.com if you can't remember that go to investwithflint.com.com. and it'll take you right to my website.

Very good. And spell Vestas anyway.

V E S T U S. It's a play on words. Invest with us. Vestus Capital.

Yeah, I think that's good. All right. And the show notes will have your contact information. And I thank you very much for coming on.

Perfect. Thank you, Jimmy.

All right, take care.