Mastering Mindset: Melvin Landry's Great Comeback

Foreign bowling here with Pivot to Prosperity, the podcast brought to you by Pivotal Real Estate Investments, where we help our investors build wealth and income through commercial real estate that also improves communities. And today we have Melvin Landry with us. And thank you for coming today. I appreciate that, Melvin.

Thanks for the opportunity. I appreciate it. Yeah.

Yes, yes. Well, so why don't you go ahead and introduce yourself?

Sure, sure. So I'm Elvin Landrie. I reside in Pittsburgh, Pennsylvania. I'm a native of South Louisiana. So I grew up in between Baton Rouge and New Orleans and. Yeah. And been living in Pittsburgh since 2021. Been investing here since 2005. So, you know, the journey has been one, has been a fun one, and it kind of comes full circle because it brought me back to Pittsburgh, Pennsylvania. So, you know, when I invested in my first property, it was a small duplex that's about 18 minutes away from the house, and I was doing it while I was living in Omaha. So. Yeah. So, yeah. Say life comes back full circle. It really does.

That's great. That's great. Well, now, when you before, when we were talking before recording, you didn't mention Omaha. So you've been a lot of places. Tell a little bit more about your journey, would you?

Sure. So journey. Let's see, man. Journey. Started undergrad in Louisiana. Then I went to the University of Arkansas, and then I pivot back home area University of New Orleans, got my MBA. So I got three degrees by the time I was 22. And then I jumped out into the workforce, moved to Greeley, Colorado, hour north of Denver, working for one of the largest beef packers in the country, which is now JBS Swift. So they think about Swift Premium. I was working for them. So they're single. Bought a new car and got on the road and left. Went to the. Went to the. Went to the Mighty West. So did that and lived in Colorado four years. Then it took me over to Omaha, where I lived in Omaha, Nebraska, in the middle of a heartland for six years. In between that time frame there, you know, I kind of got exposure and was looking around the real estate. So I went to a seminar and I got the opportunity and I purchased the REO and the Swissvale municipality 18 minutes from the house.

REO Real Estate. Owned a foreclosure.

Yeah. Bought a foreclosure and got it renovated. So I bought it 32,000 and I put like 10 into it. And, you know, I got dealing with programs. You know, I like affordable housing programs. This one did section eight. I was getting 850 for the top and 650 for the bottom. And I was cash flowing. $900 a month on my very first property.

Nice.

Could imagine. Look, it was going well. I knew the tenants. I was getting to Pittsburgh. But one took water. And you know, while I was coming to Pittsburgh, I was visiting my buddies, my fraternity brothers who I still keep in touch with to this day. And you know, and I started buying more. I just started buying more real estate indirectly. My foot was kind of off the gas. So I wasn't, you know, I had built a power team. I had contractors who had gotten built a report with. I had a realtor I was going to, had a title company, had an appraiser, had a structural engineer. So I built the power team and they knew I was out of town, so built trusted relationships and look, it started going well. I just started buying more reos. That was kind of like my focus. So in between that time frame, you know, I got a mentor.

What years was that?

And we're talking 2006, 2007, 2000. Between that time and you know, I was in.

The prices were going up.

Yeah, yeah, going up. But I was still getting primary REOs. So it's bottom of the barrel prices distress. I was buying them. I was buying. That was my buy box. My buy box was distressed. 35k and under, scooping my cash quick close, lined up work for my contractors. I, you know, I know they were working remote, I was remote and I go check on them, drop in periodically randomly so they knew, they didn't knew when I was in town and you know that the spot check, sometimes you got to do that even in today's world when you have large apartments. Right. And look, it started going well. So you know, when I first started, I bought in three states. Pennsylvania was kind of like my gold mine. I bought in Arizona and I bought in Indiana too. And you know, the lad, the next two didn't bode well for me. So I ended up short selling my property in Arizona. Huge loss. Yeah. You know, and I short sold on the property in Indiana. Even though it cash flowed, I still, I still short sold it. So the focus ended up turning to Pennsylvania. So stuck to it, kept growing, kept growing, kept growing, kept buying, kept buying and got it to the point whereas 60 plus properties and I'm cash flowing 35, 37,000 net. You know, you know you think about, you know what I was doing and look, and this, my foot was off the gas. I wasn't concerned. Look, my, my mindset was different. My mindset was on my 9 to 5, and I was teaching classes I just started getting into. And I've been teaching March and maybe 20 years I've been teaching online. Different schools, different capacity, 40 different schools around the country. So, you know, my mindset was a little different back then. So you think 20 years ago, right, this was a little different. So.

So you were teaching, but on your rentals, you were making 37, 000 per month, right?

30. Net cash flow, primarily affordable housing.

Want to make sure the audience voucher.

Yeah, folks with vouchers. And look, here's how. Here, this. Here's how I spearheaded, right? So I'd rent to one lady, ironically, one lady's sister, her aunt, her cousin. Everyone had vouchers, and they saw how you look. We approach renovations. We took care of tenants. I had a system in place, right? Real estate is all about the system. That's how you drive success. And I mean, the whole family was renting from me. This got to be a family affair. So I would come to the city. The family knew I was there. Hey, Mr. Landry's in town. Pop in, pop in, make sure everything's good, Checking things. If there are issues, we get it addressed. And I mean, the demand for housing for my folks, because, I mean, look, I was remote, right? I was kind of managing being a project manager from Omaha. And. And look, I mean, I don't want tenants complaining, right? I was actually asset management, right? Kind of doing. Doing it. Managing it on my own, right? Requests were funneling to me, and I dispatch people. And look, you keep tenants happy when you get stuff done, they pay on time. And look, there's always about 7 to 10% of folks who just won't do. Right? That's evict, you know, again. And we talked before the show, right? The Pennsylvania State is 41 days to get someone in and out, and that's if you're kind of going formally without waving, posting notices on the door. So I had been through the motion that I know to the day how many days I can get someone in and out of an apartment, so. Or a unit. So. Yeah, yeah, yeah, that's.

It's tough when you're remote, too, because you have. You have to have people you can trust to go do things.

That's half the battle.

Back then, you probably couldn't file stuff electronically either, right?

Yeah. No, no, no, no.

Covid helped that.

Yeah, for sure. I mean, but for the most part, I mean, for the, you know, for the 7 to 10% of folks who I did at the end of getting rid of. I mean, it just became just like, blatantly, you know what I mean? And look, I didn't think I wouldn't hesitate to hop on a plane, go to court, get you out of there. You're talking 10 of the time, so not much, but I'll do it, you know.

Well, when you have a net income of 37, 000amonth, too, it's not a big deal to jump on a plane and go over. Really.

It's not a big deal. And I guess at times, if I kind of proven a point. Right.

But yeah, you know, see the college buddies, too.

Yeah, yeah, yeah. Hang with them. Yeah, hang with my buddies, too. So this is another good lesson five.

Where you like to go, right? Where you like to go. Yeah.

Now it's a little different, but. But, yeah, I mean, but, you know, I had a system in place at a mentor, and, you know, I was. I was on a roll.

So I want to fast forward you a little so we leave enough time out. But I do want you to touch on your franchise experience briefly. But then let's get to where you are today with your awesome portfolio, diversified and. And we have to leave time for that.

Sure. Yeah. So, you know, fast forward 2011, August. I meet my wife, get engaged 12 months later, get married in 2013, have a son in 2014, and voila, 2015, we get into a business venture. We get into a business venture. That takes me. Fast forward.

Right.

You think Omaha. I'm living in Vegas. When I got married, I was working for the casinos. And.

And how many houses did you have then?

62.

Okay, and so you were a teacher and work in the casinos?

Working in procurement for. Yep. In Vegas.

Oh, procurement then. Okay. Ge.

I'm sorry.

Never mind. Go ahead.

Oh, no, yeah, I was working in procurement. Loving life. I love living in Vegas. Eventually. Hopefully it takes me back there at some point. But, yeah, look, yeah, life was good. I had kind of slowed up on purchasing properties. So you think, you know, girlfriend, fiance, wife, you were busy. Yeah, busy. Yeah, yeah, we're busy. So, you know, life. Hey, life catches up to you. So actually, it came kind of to a standstill. I mean, I was raking in the cash flow for my rental system was in place. I was just kind of maintaining, you know. So we decided to open up a. A business venture. We moved to Texas and, you know, we opened up a new, shiny business venture that engaged into being a franchise and, you know, progress in you. Fast forward in 2015. 2019. Right. We ended up closing, so not quite being the beautiful, great opportunity we thought it was. So with that came, you know, reduction in my overall portfolio. So I sold nearly 85 of my portfolio. Right. When you're dealing with exit in the business, legal issues and things of that nature.

So legal issues and paying off an SBA loan. Right?

SBA loans.

And they don't just forgive those, do they?

They don't. They don't even. Even with COVID and things of that nature. So, yeah, ended up seeing my portfolio dwindle, so had to sell cash flow on rentals. And was I overly concerned? It hurt, right. I mean, I lost a lot of cash flow, as I told you. But, you know, I trusted the fact that I had the education for a system, right. And I felt pretty strong that I can do it all over again. But it was like it was a rough patch. 19, 20, 21 was rough. So, you know, we ended up moving out of Texas, decided to move to PA with the intent was, hey, we can, you know, you know, I can ramp this thing up again and can kind of come out the gates running pretty fast and got exposure to multi family. Went to seminar, got exposure to multifamily. Saw how folks were building million dollar portfolios quickly, how folks were getting the tax benefits. And that just kind of kept me inquisitive to, you know, expand my knowledge, continue to get educated, build on the knowledge that I had. And just look, I mean, fast forward to today, right? You know, life comes back full circle. I mentioned, look, I'm back in Pittsburgh. It's kind of. Here's kind of where real estate started for me. And you know, I'm an active and a passive investor, you know, and the foot is on the gas. The mindset is different. Right.

So I need you to speak up because I want to be sure people can hear you talking like this. Because this is the men. The mental.

Yeah.

Part of it that. Yeah, look, look, I mean, you can overcome a lot.

You can, you can. Look, I lost a million dollars in an adventure that, I mean, yeah, it hurts. But you know, when you get. When you got the mindset of having unwavering support, you know, you come back stronger. And that's kind of how I look at it. Have no regrets. You know, you fall back down, you get back up. Right. And I'm a, you know, I'm an, I'm an athletics. I was a college athlete. I ran track in college. I ran cross country. Right. Sometimes it's not about how you started, how you finish. So look, I'm Excited, I'm blessed, you know, came out of it stronger, involved in real estate. I understand the tax law now. I understand how one should not pay taxes legally. And at the end of the day, it's about cash flow. Cash flow matters, right? You hear folks screaming, you hear the noise in the media. Interest rates, interest rates. You know, if you can make a lot of money in a bad economy, you got it made. Okay? So. And you know, and you know, does economic principles come back full circle? It could be doom and gloom outside. That's okay. That's okay. You know, I'm still excited, I'm still fired up, still buying real estate, you know, still passionate about affordable housing, still growing the portfolio, you know, need a passive investor notch. Right. It's something new that's kind of fast. And man, benefits of passive investment. Oh, my goodness.

Oh, yeah. You don't have to spend any time. Once you make that decision.

You get the reports, you're locked up with the team, you ask the questions, you get the K1 with the passive losses. Oh, man, it's like, like a kid in a candy store. Like, let me get some more of that. Right? So they got educated, right? It's just like, look, we do four to six passive investments a year and we're investing in different things. So I've, I've co sponsored self storage. I've gotten in passively on a triple net that's bringing good cash flow.

Explain what the triple net is. Explain what you did on triple net.

Yeah, yeah. Triple net is, you know, when a group of individuals buy a retail building. This is educational facility in Salt Lake, Texas, and you buy cash and we're reaping, you know, I get a monthly, I call it monthly stipend and it goes back into my ira. So, you know, I've worked a lot of jobs in my career and I had all these IRAs sitting here collecting dust, doing nothing. Put them to work once I realized that I could. And you know, 18 months, I'm in like 14 deals.

Yeah, you have quite a portfolio. And so when you say you put your IRAs to work, go ahead and expound on that a bit.

Yep. So I had all 401ks. I've worked a lot of jobs. You know, I moved around a little bit. Right out of each one of those employers, I had a 401k just sitting there collecting dust, doing nothing. So, you know, I, I was involved in stocks and bonds. Right. And some do well, most don't. Some are just kind of status quo. So I liquidated those and the power of real estate kind of helps bring a lot more advantages that stocks and bonds just don't. And you know what, investing with your self directed IRA gives you control. I want the control to do what I want to do with my money. So if I win, I grow with appreciation, which is in many cases happens in real estate, that's a win. If it doesn't, you know, that's okay too. What goes up. What, what goes up must come down and vice versa in any market. Economics 101. So, you know, so I'm very passionate about kind of putting my money in behind real estate. Now I've gotten educated in on the tax benefits associated and I'm trying to share the knowledge and share the word. But I'll, you know, Jenny, I'll say this. There are many folks out there who are still not listening. I know. So I know.

Yeah.

Very unfortunate. And you know, I kind of want to, want to speak to it. It's very unfortunate that folks are not listening. Folks are not taking heed to leveraging and making choices on their own. And you know, at the end of the day, I mean, hey, look, it's lonely at the top. I'll just say that. I'll keep preaching. Yeah, I'm a testament, right?

I mean, you are. Yeah. Yeah. So. And let me even grab a line that you said there. What goes up must come down. There's, there's one thing that, that I think that especially you as a professor of economics, you're going to take the, the lead here from me. But I'm going to say is that real estate, the dirt, the ground we all stand on, is the most known for building wealth than anything. And since the beginning of man, people have fought over land. That's what brought about kings and queens and land holdings and all the rest of it. So it does come down, but relative speaking, right. So it's all the while the cost of real estate, even though it fluctuates some, it's still. Go ahead.

It's, it's, yeah, it, I mean, it's still maintaining, holds its weight right at the end of the day. And look, I mean the population, right, Population is not going down. I mean, you know, so, you know, they, people need housing, you know, folks need places to stay. That's never going to be null and void. So look passionate about the outcome of being able to provide. I mentioned earlier to you before the show about affordable housing, you know, providing that opportunity for individuals. And look, it brings a newfound appreciation that you can kind of can provide so look, we love dealing with programs in our own local market and continuing to strive to put those affordable houses and opportunities there for individuals.

So for your area where you do so much of the section 8, do you find it difficult to deal with the government on any of that?

Jen, I've been dealing with it so long, so I would say no. I, I mean, look, I got my first Section 8 tenant, what, 2005, 2006. So I understand the parameters. Yeah. So, you know, I know what needs to be submitted. I know what they're looking for. I, you know, get a packet in, someone gives me a voucher, I get it completed. But they need taxes, they need verification, they do background check what they've done. Because I've been in the system for so long, so I can get things turned relatively quickly if someone needs a rush, if there's an emergency situation for maybe a young lady or a guy and her family and her kids. I know, right? I've been doing this a while, so it just comes second nature in terms of here's what we need to do, etc. One of the things I do now versus what I didn't do before, I run background check on all tenants. Didn't do that before as I got educated now I run background on all. So I mean, in hindsight I can be, I can pick and choose. Right. There's, you know, certain type of tenant that I'm looking for that I want, you know, in my units. But I mean, you need to pass a background check at the very least. So.

Well, we won't get into the nuances of all that. So your apartments now, are you usually a limited partner in those or are you a general partner on some of those or how are you doing that?

Both. So general partner on about 265 units and limited on 2700 and growing general partner on self storage opportunity in South Carolina with a fantastic team. 517 units also as well.

So that's terrific. And that's all since when, what year did you start?

Late 2021 is when I really got ramped up and going. So, you know, we just, I mean a good going on 20 months now.

2700 units plus 500 plus in storage. That's huge.

And looking to grow substantially in 2024.

And how many houses do you own? Are they counted in that 2700?

No, it is not. No. We have kind of restarted in my backyard. So we're back at 11 and another seven on the contract. I'm trying to buy one multifamily a month in my own backyard. If I can do it. Trying to buy one a month, whether it's a 4 unit, a 6 unit, 10 unit, my goal is to buy one a month.

You know, are you using your money or other people's? Are you syndicating? What are you doing with those other.

People Money, Private money, Other people's money. Private private lending. So the goal is leverage. Get it quick, renovate it quick. I have some more crews now that I'm local and you know, turn around and kind of refinance the debt into portfolio loans. Right. You know, you hear folks screaming about interest rates are high. I mean, look, I'm getting none of these loans quickly, but they come at a price, right? Nothing comes quick, low and easy. The rates are relatively high. So. But you know, the outlook is, look, you know, everyone is hedging their bets on the, you know, rates being cut in 20, 24 is going to come at some point, but labor is still strong. So, you know, I think the back half of the year we'll see that quite relief that many folks have been looking for. It's going to come at a perfect time because I have units ready to kind of put into a portfolio. And for me it's about, you know, the whole time on these local rentals are going to be kind of infinite. I want to be able to pass it on to my little guy and he can have cash flow when my days are done. So it's about legacy world building now. You know, I have one son, he's nine. He understands mom and dad's investors, he understands cash flow. We go through flashcards. So there's an enhancement education that I'm trying to get him grounded with because his passion is aviation. He wants to be a commercial pilot, will help him get there, but he can invest too.

So yeah, he sees that money coming in probably. Yeah. Getting your pilot's license. Pilot's licenses aren't cheap, right?

I'm prepping for that now. Yeah. So for the hours. Yep.

That's great. Well, listen, I don't want to go too long here. I would like to ask you my big question and that's Is there a pivotal person or event that's made a big difference in where you are today?

I will say the event with closing the business was a pivotal moment, at least for myself, my family, my marriage, etc, you know, one could have really been an ostrich and just stuck their head in the sand and not come up. So I was wanting to kind of take the high road, like, look we'll come out to stronger. And I've always had kind of an easy going, even kill mindset. We will come out here stronger. I built a real estate legacy portfolio with my feet off the gas and got into 60 units. I know we can do it if we really put our foot on the gas, kind of, kind of put our heads together. So got alignment. My spouse coming out of the business ordeal, we came out stronger. I mean, look, and it's, it's an unwavering mindset that's is ferocious. You got to be ferociously obsessed with wanting to be successful. And my wife tells me that all the time. And that's okay. You know, I, I mean, you know, cherish. You know, the mindset is so different now versus when it was when I bought my first. My first property. Yeah, it's just like, you know, we got it, we got. We got to stick to it, right? So it was a monumental shift, and I'm glad that that happened because I came out stronger. My mindset's a lot different, and I'm so focused. I mean, we're reaping the benefits now, so. And we're growing and we're making an impact, and we're setting ourselves up for, you know, an early retirement. So, you know, you hear, you know, you hear folks, you know, an adage kind of stuck with me in terms of, man, they teach you to go to school, right? You go to school, get a job, work 30, 40 years, then you're 60, 62, 65, and then you got 11 years left for retirement. So, you know, I think about that, right? And for my family in particular, so the average age of my father.