Consistency with George Giannopoulos and Jeffrey Znaty

Welcome. This is the Insider's Edge to Real Estate Investing with James Nelson, the principal and head of Avis & Young's Tri State investment Sales Group. In this program you'll learn game changing strategies to outperform the market. James will teach you how to source, execute and capitalize on the best real estate opportunities in New York and around the world. Now here's your host.

Welcome to episode number 156 of the Insider's Edge to Real Estate Investing. This is your host as always, James Nelson. And thank you to all of you so far who've reached out with your reviews of this podcast. I think I'll offer this up one more time which is if you email Ann A n n e@james nelson.com A copy of your review of the show on Spotify, Apple, wherever you're listening to this podcast and sending it to her with your mailing address as well. I'm happy to send you a signed.

Copy of the book.

It's my pleasure to give you this gift. I appreciate your support and listening and your ratings help others find this show. So please make sure and take advantage of that. Okay, so for today's show we've got a real treat for you. We have George Giannopoulos and Jeffrey Zanotti. And look, some of you may have already seen this interview live on Instagram, so if you are not following me there @ James Nelson NYC, you want to go ahead and do that so you can look out for future live streams of these interviews. And I think when I get a chance to do these interviews in person, it's not only a lot of fun but certainly more chemistry as well. And I think you're going to enjoy this one. So for today's episode you're going to get incredible insight and in my conversation with these co founders of Kings Capital, they share the power of following a regiment both personally and professionally which can help you gain an advantage in the real estate world. They advise starting small and taking on bigger deals as you grow. A strategy has helped them gain an outstanding track record. King's Capital is a vertically integrated real estate investment and management firm headquartered in Brooklyn, N.Y. specialize in value add creation through the acquisition, design and repositioning of multifamily mixed use and retail assets. It also carries out ground up development projects in both core and transitional neighborhoods across the us. We talk about one of their acquisitions, property that our firm sold them in Brooklyn and I have to say that they jumped through hoops of fire to get this deal and did whatever it takes, so I love their focus. George and Jeff both grew up in Brooklyn but didn't cross paths and connect until later in life. George graduated with a finance degree from St. John's and went on to attend NYU Shack. He co founded a real estate brokerage firm focusing on off market deals and later he started Brickstone Properties, a boutique investment firm focused on value add, redevelopment and development properties. Meanwhile, Jeff holds a degree in Business Management from Brooklyn College and has actively handled real estate deals for the past decade in New York and has been involved in over $400 million worth of transactions. A background in brokerage enabled George and Jeffrey to look at many deals and ask investors questions about their projects. George tuned into buyers who were repositioning properties and looking to add value. Jeffrey started putting his knowledge to work on the investing side and invited George to join in on a deal. The two began taking on projects that eventually form what is known today as King's Capital. Looking back on their keys to success, George and Jeffrey credit following routines, maintaining relationships and valuing in person time. They stay focused, in touch with brokers and manage an extensive network which helps them grow into bigger projects. Being consistent has opened doors to tremendous opportunities and enabled them to gain a competitive edge.

As always, you can go to james.

Nelson.Com where you can find show notes as well as connections so you can link in with both George and Jeffrey. We're going to have a brief word from our sponsor and we'll be right back with that interview with George and.

Jeffrey, co founders of Kings County A.

Different Approach to Putting Our Clients First Avis and Young's Tri State Investment Sales Group sells multi family office, retail, development and specialty sales throughout the New York metro area. As experienced thought leaders in their industry, our 35 member group is available to help you make informed investment decisions by advising you on your current holdings or identifying new opportunities in the marketplace. Our one unified team is built on an industry unique platform with which promotes unparalleled collaboration and teamwork. We share core values of hard work, integrity and expertise. We put our clients first providing tailor made strategies to achieve superior results. Please Visit us at aytristateinvestmentsales.com and follow us on Twitter LinkedIn and Instagram amesnelsonnyc to learn more.

Hi everyone here today with Jeffrey Zanotti and George Giannopoulos who are co founders of King's Capital. This is really exciting because I know we've spent a lot of time together, we've done deals together, we've collaborated. So really excited to have you Here in the office and here on Instagram live with our guests who will be joining us as well. So thanks for coming in.

Thanks for having us. Thanks for having us. It's a pleasure.

All right, so let's start from maybe where it all began, and maybe we'll kind of go back and forth to, you know, the point where you two eventually met. So, Jeffrey, why don't you talk about kind of how you started out, maybe how you got into the business, just so our audience can get a little sense of where you came from.

So I originally started as a broker doing investment sales, and my thesis was doing smaller projects in Brooklyn, Deals that were very achievable to do three unit buildings. Knew nothing about the business. Bought my first building, just learning it on the fly with our other partner, Richard Wheeler, and started picking up 2, 3, 4, 5 assets in Brooklyn and realizing that as we started growing and having more demand for profit or returns, the deal sizes had to get larger as well. So mainly a lot of the deals we're dealing with the three and six units. But as we started growing, we started doing larger 8 and 10 unit buildings.

Awesome.

Years later, George and I actually met in Vegas, coincidentally at icse, which we were both at last month.

Good.

And we lived 15 blocks from each other, more or less. We're both from Brooklyn, born and raised. King's Capital is a spin off of Kings county because that's where we started.

And that's where we're from, Kings highway, too.

Kings highway is where a lot of his assets and his family's generational assets are. And we met, I don't know, 3,000 miles away in Las Vegas, however many miles it is. Ended up coming back to New York, meeting a lot of the same people, connecting, and the rest is history.

Love it. I'm gonna move the microphones a little bit closer to each of you, so you can just make sure we get the. The audio. Good. So, George, tell us your story. Where did you start out?

So I used to try to realize I used to work with my father in the family business, and real estate was a secondary business for us. You know, my father invested as a place to basically put money. It was never intentionally meant to be as an investment, so to speak. I got my real estate license just because I thought it was the right thing. And I slowly started helping manage and help reposition one of his properties, which is my first real experience in real estate. Managed some of his assets, and then moved on to be a broker. Worked in a lot of small off market deals. By myself, sold some every asset from development, multi to even outrights. It was. I got a little experience across the gamut. That's when I met Jeffrey and we had, I told him I was looking to invest at the time and he had showed me some deals after took about a year or so of trusting me.

This guy's a little too suave, good looking. Even though I think I'm the better looking partner.

He didn't trust me.

Suave, good looking, good talker, knows what he's doing and I said some things but I realized what was off about him was he was actually a good guy and there was more that meets the eye with him. And thank you. Here's where we are today. Buying properties and kicking butt, doing it together.

Love it. And we're going to definitely get into. I want to hear more about finding the right partner because I think it's really great that you both recognize that one plus one equals three and that. And I'm sure we're going to talk about how you complement each other. I mean we all have different strengths and weaknesses. But I want to get back to the fact, and this is interesting, that you were both brokers. I'm clearly a broker today. I also do a lot of investing and I think brokerage is a great introduction to investing. Right. Because first of all you see so much more deal flow, right? So as, as investors, operators, you guys do, you know, maybe it's a dozen deals a year, right. When you're a broker, you're seeing, you know, hundreds if not thousands of deals. And you're also seeing how different investors, operators do things. And that, that's a lot about what I put in this book is kind of seeing what works and what doesn't work. But maybe Jeff, maybe talk a little bit about what were some of those skills that you learned from brokerage that has made you an effective investor today.

So one thing I could tell you as I was dealing with a lot of due diligence because a lot of the properties I was working on is multifamily. It's a lot of details, DHCR records, recordkeeping, even your book, you mentioned that a lot of ways people got more acclimated with real estate was through the brokerage world. So. So I think definitely grasping a little bit of what your clients are doing, asking questions and a lot of it was really details, being oriented to details of properties. Record keeping. I think once we got into the business we realized record keeping can make or break the investment, you know, value in terms of DHCRS and rent stabilized for the most part. We're in multifamily. So records and DHCRs are historical, which you need these records. But I think really just grasping what buyers are doing, asking questions as a broker to be able to understand where their thought process is to a, not only help them but hopefully maneuver your own deals as things come into fruition, you know, in your investment life, in your investment life and deals.

So, so first of all, you get extra credit for referencing the book. Anytime I have a guest on who references a lesson in the book, you know, you're already ahead of the game. So thank you for saying that. But I think you, you bring up a really good point about really understanding the asset and getting under the hood. And that's what a good broker does. There's a lot of brokers out there who are just, you know, dialing for dollars, throwing things against the wall, hoping something sticks. And they're probably not doing the work, they're not doing the research to actually vet what's happening. And I would, you know, most of those deals don't come to fruition because the buyer through their diligence process finds out probably, you know, generally too late in the process and it blows everything up. So I know, you know, the key to being a good broker, which is also a key to being a good investor, is doing that work up front. So whether you're communicating to potential buyers as a broker or as an investor, an operator to your investors saying, look, this is the, the opportunity, yes, there's challenges, here are the problems, this is what we're going to do to address them, but really taking those on upfront. So George, what would you say, what are some of the lessons that you learn from brokerage that you apply to being a successful investor today?

So a few things stand out. One of the first things I remember is touring a large multi in Midwood with a large buyer. And I remember them walking in with a notepad and pencil and they were measuring and afterwards I realized they were figuring out how to add bedrooms and how to reposition the asset, which is somewhat of a strength of mine today. So just understanding how to create value through at the time it was pre 2019, so they were preserve and stabilize assets. So understanding how to essentially take the laws, you know, what they were at the time and you know, the creativity of a landlord to, you know, add potential rent roll to the building development sites, which I worked with a lot of developer smaller sites in Brooklyn. And understanding that actually you can't, you always use all the far and understanding, you know, coverage and things of that nature. And what's the proper way to truly maximize an asset without. What's the right word? Without needing to use all the far and spend some money. So the two things that stand out.

In my mind, so you're able to really learn from a lot of the successful buyers who you're working with as a broker to see kind of how they did it and kind of taking parts of that and seeing how you can apply to your business. And you know, one of the stories I do reference in the book, and it was the first investment that I ever went in with, was with Matt Blesso from Blessed Properties and talks about how he was really able to unlock the value of the property by exactly what you just said. You know, seeing this is an opportunity not only to, you know, conduit but add air rights and reposition the retail. And so it's, it's definitely a business that you learn by doing. So what about, let's talk about some of the other skills and you know, maybe, maybe you'll tell us, were you successful brokers? Did you make a lot of sales? I mean, what was kind of the key to your success as a broker? What were kind of the attributes to be successful that again, you've applied to your investing business today?

I think the number one thing any brokerage, and I think in any aspect of business, broker, buyer, any department, is relationships. Having a good name and having good relationships. Avis and Young does it very well. When I was a broker, I made sure to make relations, people get friendly, go for drinks, network. I walked into a room one time, people came out to me, said, who are you? I said, what do you mean you go, you know, everybody in the room. I said, well, was on that way three years ago or two years ago. And it takes time to really build a name, build relationships. But I think having a name, having a friendly relationship with people, people want to do business with their friends. So if there's two equal brokers and you're friendly with the guy and the other guy is just as good as you, who do you think they're going to give the project to? So I think making solid relationships, having friendly, you know, more social level as well, I think is very important. I try to do with your guys as well and we get some good deals.

We had it, we had a pretty closing dinner. I know I left at 11 o', clock, but I'm sure it went on, you know, far longer after I was, was in bed. Although I know George is probably still up at 5 in the morning working.

Out the next day.

But definitely relationships and having a good name. And I think when you have good relationships and when you need to get things done or over a certain hump, that's where deals or happens because of those relationships or those key important parts.

That's awesome. If you're just joining us now here on Instagram Live, I'm here with Jeffrey and George, co founders of King's Capital. You're getting the early look at what will become our podcast episode probably a couple weeks out. So we thought this would be helpful to share this with you all. Now if you want to ask questions in the feed, you can, you can do that, but let's, let's carry on. So George, what, what else kind of those keys to maybe some of your brokerage success that have stayed with you to make you a successful investor.

So it's so much. I have to piggyback what he said because for us, I always say your name is worth more than any deal you could possibly do. So having cultivating strong relationships is something we focus on as a company and as human beings. You know, I think we, we do a good job of trying to get to know everybody, you know, build relationship with the best brokers in the city, such as yourself, and you know, just, just kind of cultivate friendship because it's, it's not just about business. And just if I add one last thing, I'll kind of twist what you're saying. I would say that the biggest success I had as a broker was probably failure. So it wasn't, if it was not for my failures, I wouldn't have probably transitioned into the principal side. So I remember a period of time where a bunch of deals which I thought were closing didn't close. And as a broker, I remember doing everything on my side that I could have done correct. And it was this, it was the decisions of others which affected my well being, which motivated me to become a principal, buy my first property. So that's, those are the two things that stand out for me.

That's a really interesting perspective because it wasn't, okay, I failed. You know, this was a failed exercise. No, I'm not going to give up. I'm going to pivot and I'm going to go to the other side where I can be more in control of my destiny.

Exactly.

I really like that. Um, I thought maybe, George, you were also going to share some of the mindset because I know when we were at that closing dinner and talking about you know, podcasts and Tony Robbins. You definitely have a regiment. So, so maybe, maybe just for our audience, share a little bit about your regimen and how you get rolling in the morning and get in the right frame of mind.

Sure. I believe that if you start the morning on the right head, it's, it sets it up for a successful day. You know, I think starting off if, you know, you know, I guess was a creature of habit. Maybe it's the rhythm of New York. We're always rushing and trying to get there and the traffic and whatnot. Where I set myself up from the night before, where I would try to get ready, get my stuff ready, have all my clothes out. Just little stupid habits like that that would just essentially allow me to leave in the morning a little more peacefully. I would wake up a little earlier. I meditate every morning. I have a gratitude journal, which is something I've been doing the last three to four years, which I try to write down half a page or so of some little things that I, I'm grateful for. And it's more of setting myself up to be positive because you can always find something to be negative about. But if you're focusing on gratitude, it's very hard to, to find negativity in life. So there's always something to be grateful for. I journal a little bit if I can, and do my prayers and I head to the gym for about 90 minutes or so and wow, off to the races.

You must start early.

If he's doing that, it's early. But the one, he starts early and he ends early, he ends late. So that's a good, it's a good combat. But one thing you forgot to mention was you told me, I think the first 10 or 15 minutes, you don't touch your phone, no screen, you kind.

Of just do this whole, yeah, it's meditation, prayers, journaling. I don't look at my phone for at least 20, 30 minutes.

Most of us wake up in the morning. The first thing I'm doing is email me who texted or called.

So you don't pick up the phone till what time?

You said, I'll pick up the phone to put on a meditation. But then I, I don't look at my emails, I don't look at calls for at least 20, 30. I don't look at anything for at least 20, 30 minutes in the morning.

I love that. That's really good. I, I, I, I, I would say for me, it's probably, yeah, probably two hours into the day before I start, you know, checking out Email? Yeah, well, you know, because I'm getting up maybe not 90 minutes in the.

Gym, but, you know, 4:00am Guy or something.

4:45. So, you know, so, but no, I, I, I, I like the idea. And I also try to, you know, I come up with kind of the top three. What are the three most important things that I need to do in a day before I start it? Because, you know, once you get into that rat ra is once I clear my email, guess what happens? I get another 20 emails. So it's like you could spend your entire life emailing and you would never get through anything. Right. And so, you know, what I found is if you can kind of batch that email and say, okay, I'm going to try to knock them out in the morning, I'm going to get back to him in the afternoon and then, you know, close out at night. But, you know, it's not about me. So let's, Jeffrey, let's, let's. Do you have any routines or things that you do to kind of get the day rolling or maybe at the end of the day kind of recapping?

So I'll go and give a little credit to my partner over here because one of his routines has become more of a norm for me, which is not eating in the morning. You become a little bit more lighter and you come a little bit less cloudy. Cloudy. You know, when you eat during the day, usually a big lunch, you feel a little more like a food calm when you feel very relaxed, almost tired. So we try to keep the morning very light. I don't eat in the morning. I try to work out in the morning, but usually it happens at the evening time. And I think really just starting the day positively, I think George has it correct. I try to wake up in the morning, have a good mindset, not to get too enamored by emails or calls. Listening to a podcast mindset mentor who's Robert Dial is pretty good and a few others that George has given to you. So I think it's really just getting the mind right in the morning, doing things that's healthy for your body, whether it's working out or eating right, and finding out what the biggest tasks of the day are and focusing on those tasks for the day. Starting off the right now start off the day right, I think is most important.

Awesome. All right, so you guys talk about how you came together. So at this point you said you, you had, you bought a couple smaller things on your own and George, did you as well or did you guys just say okay, we're going to come together, we're going to do this, and we're going to start buying.

Interesting story. So first Property purchase was 242024 Dean Street. It was by the Broadway junction, by Dean and Eastern Parkway, an area we thought would explode, which still is taking some time, but I guess once they redevelop that train station will turn into something different. Purchase another property not too far from there. 1836 Park Place. So we bought them pretty well. When you say we, I'm sorry. My partner, Richard Wheeler, before George came in the mix. This is about 2011, 2000.

And this is just using your money.

Family, my own money.

Okay.

My personal money and personal funds from brokerage and saving up. And we bought these two assets. We sold them, I think we bought them at $185 a foot on the bricks, which was cheap. Sold them a year later for double the equity. Whenever we put in, equity wise at that time, Jordan and I were getting much more closer, friendly, acclimated. We went out. I actually went with him to Greece that summer in 2015. Correct. And I remember calling him up. It was two in the morning for me. It was nine in the morning for him. I was leaving some bar, some establishment. I said, I have a toe closing and an extra couple of dollars. Whatever it is, do you want to jump on board? And I think your answer was you didn't know too much of the building. It looked like it was in the right area between two good pockets of Bushwick and Crown Heights.

That's fine. Bushwick. I said, okay. The metrics seem good.

And to be honest, we started not knowing too much about how it would work out. He brought in his brother. His brother has been a big part of what King's Capital today is. Thomas Giannopoulos, construction, management, design, layout, repositioning. He has a lot of the vision. His brother does a lot of the implementation. And we're off to the races. Since then, we bought about six properties in Brooklyn, another four or five in Manhattan, a couple of pieces in Texas. Recently moved to our new office in midtown Manhattan as well. Congrats. And we're trying to take advantage of the opportunities. We closed the deal with you about six, seven months ago. 150 Clinton in Brooklyn, which was a great piece. Really. Kudos to the Avison Young team. And I think that was basically how we started.

So how did you. Actually, one thing that's really impressed me about what you all have done is you've really built a brand. Right. So there's some investors out There, maybe you're listening and, you know, look, you've done a couple of deals, but the world doesn't know about it. Right. And I don't want to make this sound like you guys are just being self promotional, but, you know, it's very clear that King's Capital has a brand. And you're very thoughtful about how you put things out there and what that signals to the brokerage community is that you're active and you're out there doing deals. So was that something when you launched this? Like, when you form King's Capital from the start, you said, okay, we've got to build a platform and maybe make this look bigger than it actually is and like, really build it for the future. Or is this just something that has evolved?

It just evolved, you know. So King's Capital, the entity of King's Capital, I think, was way down the road. We had purchased five or six buildings before we actually came up with the company.

And these were just as you guys, just partners putting money in so that you still weren't bringing an outside.

It was just the four of us. Yeah, we were just, you know, you know, buying, rehabbing, refinance, repeating, rolling. We were five or six within, you know, certain small pocket. And the goal was to build a portfolio and exit it there. And then it wasn't until Covid, where we pivoted out and that's when first Manhattan Property. It was a great opportunity. But to answer your question, I think it just kind of evolved. You know, we started bringing in guys and then little by little, we, you know, we said we're going to do this and create a company and branding and the website and the whole line and just, you know, being people first, we understand, like just what's. What's important. So just being good and putting out the good energy of who we are as people, I think that translates into a brand. It's not. It's not self promotional.

It's just being, well, letting the world know what you're.

This is.

Right.

Yeah.

So what was it like raising money for that first deal? So maybe you could talk a little bit about it. Like, what was, you know, how did you go about it and how do you now built an investor base?

So I heard a little bit of this question yesterday when I popped into James's other podcast yesterday, which you'll hear on the next. With a live. Which you hear on the next podcast. But I heard it, I actually thought of this question. Okay, so it was definitely a little bit of a challenge in the beginning because, you know, at the beginning we were using our own money. And I think in 2017, we bought about three or four properties. And it was big for us at the time. We were buying maybe one a year. And we didn't buy anything in 2018 and most of 19, because we use a lot of our funds. We realized this is not how the business works. It's a lot of cash intensive and you usually have to bring on partners or some other type of limited partners. So when we first started our first asset to raise, I think a lot had to be with selling ourselves, what type of projects we're doing and how good we do it. And it's real estate. But to really understand it, you have to go through a full cycle. The closing finishes, the refinance, the sale. And it takes a long time for people to grasp it. So I think it took us a little bit of time to really get people comfortable. But I think as they started seeing some of the projects and one was able to get over the hump, they saw another one and it became like a ball. We ended up rolling from there. So I think once you get one or two opportunities locked in with partners, investors, friends or family, and you build that trust and you do well by them, you can build from there. Anything you want to add to that or.

I just remember referencing when I was thinking about 140 mulberry. How 145. 140 mulberry, which was our first big raise. And the challenge was we signed it during COVID I don't know if we spoke about this at dinner, but to get 140 mulberry. Sorry. To get investors on board with what our vision was for New York was. Was the biggest challenge was us. And then the combination of COVID and projecting rents that were. It was at the time was August of 2020 when StreetEasy came out with that article of 20,000 vacant apartments and getting people to believe that this was short term and we know what we're doing and, you know, this is going to be a, you know, home run of a building. Was. Was what sticks out in my mind.

You probably don't remember, even though you're sharper than me, but we actually spoke briefly for maybe a minute or two on. What's that app called? Clubhouse. Clubhouse. You have Chris Okada. Yeah. And I was coming from the closing and we were driving to Mulberry and I remember we're in the car and I was like, oh, we just purchased. You go, wow, that's great. 580, 590 a foot. That's a great basis. But as good as it is with the news and all the pictures they were painting, it wasn't so rosy out there. And people were thinking mass exodus of New York. And then look what happened. We finished the project and the rents were 20 to 30% higher than we ever projected.

So, so how did you have conviction? How did you know that it was going to recover or did know that it was going to play out? And how did you convince others that it was going to happen?

You can't replace basis and location. That's what it comes down to, you know. Yeah, can't replace those two things. So you know, when being from here, we just, you know, you know, we have a firm belief in real estate in New York. It's, it's an island, it's limited and you can't replace it.

And it's epicenter of the world, the financial center of the world.

So Jeffrey, I absolutely do remember when you came onto that clubhouse and I was actually going to say later and I guess leading in my next question, I remember when you started reaching out and I was like, wow, this guy. I mean there's some people, you know, they casually reach out, maybe a connect and like it was very clear that, you know, we, you heard on clubhouse you reached out with a call. It was a follow up, hey, I'm doing this. Can you look at this? What else do you have? Like, very conscientious follow up on your part. So I don't know if that's just how you go at it, but like, and I'm also kind of getting back to what makes a successful broker, what makes a successful investor. I mean there's plenty of people who, you know, okay, I call owners twice a year, they're going to pick up, I'm going to, if I leave a message, I'll try them again in six months. And there's others like Brandon Polakoff, who, you know is a real force. He does not stop until he actually gets a hold of the person. Now, you know, he's not harassing them but he says, you know, maybe he can't get the person at 10 o' clock in the morning, but maybe he can get them at 7 o' clock at night. Maybe they're not a phone person, but maybe it's an email, maybe it's like swinging by and stopping by the shop or whatever it is, but being very deliberate about that follow up and saying, you know, because again, you know, maybe it was one phone call, that was it. But it was very clear to me from the start that you wanted to establish a connection to show, hey, we are active, we are doing stuff and we want to see deals like that was. That was like very clear. So I don't know if that's just.

How you operate or. I remember we spoke and I think you have to realize one thing. Time is our biggest commodity, so you have to use it properly, whether it's my time or your time. So when I get you on the phone, I know I'm dealing with one of the biggest brokers in New York City. I got to make sure we're concise to the point and deliver when there's an opportunity. The one thing I tell my guys is consistency is the best. Being consistent, whether it's with follow ups with a regiment, whether it's with being, you know, in terms of how you operate in the public, consistency is, I think, what really brought us to the next level. And we try to be consistent every day. Whether it's following up with brokers, George and I, just to show you about consistency and following up, George, to his credit, was falling with an owner for a little over two years. We just purchased a couple of weeks ago a building in Cobble Hill, Cobble Hill on Atlantic. And it was a two and a half year process. And the reason is because he was consistent and concise and following up with a certain goal in mind. And I think that's how you sometimes see things, is we're able to have those results is by seeing what goal you want and being concise in that process.

And that was direct with the owner. I mean, how many of your deals would you say are truly off market vs on market? For the off market, are you going directly to the owners trying to reach out or brokers who bring you off market?

So it's mostly there. It's mostly, it's mostly brokers, you know, so we have a couple of brokers which not too many heard of, which calls from time to time, which is, which is great because they're not blasted. They don't know every big buyer in the world, which we love. But this happened to be a, a broker that was retired. Unfortunately, the guy fell ill and lost his voice. And he connected me. He got paid at closing, but I was dealing direct the entire time. So I was connected.

This is a broker who lost his voice.

No, he, he, I think he has Parkinson's. Some. Yeah, yeah, yes. Unfortunately he fell ill and he couldn't speak so therefore could negotiate. He connected us and we just kept him in the loop what was happening.

Because he had a good name relationship.

We were. He wouldn't have done that. Yeah, he, I was introduced to him through somebody I knew me and said this guy needs to do the right thing. And we're just staying on top of the record.

So. And I'm looking for the book here. It's probably somewhere behind me. Bo Barry, we need.

Well, it's the only book, but Bo.

Barry wrote a good book too on multifamily investors who dominated. And you know, he talked about how important broker relationships are. I talk about how to work with brokers in here because in his market and he's down in Florida, but he thinks that over 90% of deals in his market, either on market or off market, involve a broker. So if that's the case. And you know, for those of you joining us on Instagram right now here with Jeffrey George from King's Capital, we're we're doing the taping for the podcast show that'll be out in a couple weeks, but so they can kind of get an early look, talk about establishing those broker relationships and how, how you do that. Right. So what's your typical way of engaging with a broker? Or if a broker is calling you for the first time, you know, how can they be most successful connecting with you?

So I'm going to give a little bit of, a little bit of our secrets away. So first of all, we like to be very mindful of the news, reading what's going on, who's brokering, who's the group, do we have any connection or relationship? Usually what we like to do is we like to do some of these roadshows where we try to make it once a week to go meet these brokers in person. It's great being on a phone and being on a screen, but I think there's nothing like this face to face and sometimes get into different conversations. They understand who you are as your character. Maybe there's other relationships or other synergies. So I think definitely taking time to go meet brokers, whether they come to your office or the other way around and we usually go out, can really bring a big impact towards your relationship or how you see deal flow. And I think just really being mindful of who the active groups are, who are good groups to work with, who is focusing within your wheelhouse. We deal with multifamily mixed use. You guys are through the whole spectrum. So we deal with you on that assets. But others. But really finding the brokers that focus within your wheelhouse And I think like George said, sometimes dealing with brokers that are a little bit under the radar, build a little more personal relationship than something a little more out there or more public on the brokerage side.

You know, I'm so glad that you brought that up and you did share a little bit of the secret sauce. And I think I did write about this in the book because, you know, look, I've been doing this for 25 years for now. So, you know, people generally know when I'm calling, I'm calling people I know. And yet I would say probably if you looked at all my phone calls that I make during the day, probably 90% plus of them are still originated by me, meaning I'm reaching out, calling the investor, offering what I have. You know, and again, you can say, James, that's your job. You got hired to sell a property. Of course you're supposed to make calls. But I have found that the really successful brokers, investors are the ones who are calling, right? So it's a two way street. You're not just sitting there waiting for your once a month phone call from that broker or when they get a deal because you want to, you want to get all the deals in between and you want to know what's in the pipeline. And I think taking it a step further and coming into the office. And again, we're in this, you know, hybrid Zoom world where a lot of people, you know, look, it's easier not to come to the office and do this. I mean, I used to, you know, record these things in Zoom, but I can tell you the connection. It's just, you know, there's no substitute for in person, you know, I agree with you.

It's about being personal. Yeah, personal.

George, what about, you know, connections with brokers and, you know, ways that you've been able to cultivate relationships similar to what Jeff said.

I don't think I would add to it is, you know, it's business. But, you know, we try to build friendships. It's not just about business. You know, if you build a real relationship, it goes further than, you know, closing a deal.

You know, there are a lot of.

Brokers out there, like case in point, Jeff was a broker that had a relationship with that I didn't do business when we ended up being partner. So you end up cultivating a relationship which is really a friendship before it's a business relationship because, you know, business is only a business relationship when you actually make money together, you know. So for me, it's about befriending People and getting to know people and understanding who they are and, you know, just getting under the hood. Like you're saying, get personal with people.

Yeah, no, I'm sorry, Georgia, that at the gym, actually. And actually, one of the people are managing our properties. George got very close to them from the gym.

There you go.

He now one of my property patterns now because of that.

Look, I mean, it's. Yeah, you get to get to know people on another level than just outside real estate. And it's, you know, again, you have something in common. And it's just that one more way that you become top of mind, right where some, you know, people are thinking of you. So I now want to talk a little bit about kind of plans for the future. And, you know, so you're at this point, you got over a dozen deals under your belt. Are you now just. Do you have goals during the year where you're saying, okay, we need to make this many deals and if so, we got to make, you know, bid on this many properties. Are you thinking about where you, where King's capital is going to be in five years? What would you say to that, George?

So we do set goals, but it's not really a. We don't have a target that we need to close because we're not a fund that we need to put out money. We look into, buy every deal that makes sense, if that, if that's, if that makes sense to you. We put other eyes out every week. I would say multiple otherwise, but we're very targeted in terms of the deals we look at. And we're looking to buy as much as possible. As far as goals we're looking to do, obviously stay in our space where we do it now, but we want to increase verticals. You know, eventually we're going to get development and other different assets, which we haven't got into yet. And we will get to grow out of state business as well. I know our, our main business is New York, but we believe we can scale, you know, out of state as well. So those are, I would say, our two biggest goals.

And what about deal size? I mean, do you all, I mean, right now you've mostly fair to say, focus like 10 million and under. Like, do you all think about doing 20 to 100, 100 plus? I mean, are you thinking about just doing more in the, you know, middle market space?

We definitely want to do bigger deals and we are looking at bigger deals. Right now we have something in the city that's, you know, it's a very large asset but you know, it's, it's, it's over 20, but less than 100, let's say like that. So.

And does that mean, you know, the type of investors you have? So right now I would say it's probably mostly high net worth individuals. I mean, maybe some family offices. But do you all think about, okay, are we going to take this at some point? Are we going to do, you know, bring on more institutional partners, maybe do something more programmatic? Have you all thought about that thousand percent?

We've had multiple conversations with different groups about having that programmatic. But the deals we were looking at were just too small. So it's funny that there's much more money available for larger assets.

So.

Right.

One tip is that the bigger the check size, the easier it is because when you're trying to deal with a million dollar raise and a 10 million dollar raise, there's a lot more people to write 5 and 10 million dollar checks than there are to write 100,000. Even though it sounds kind of convoluted or off, there's a lot more people that want to put bigger checks into bigger deals than having to deal with 20 or 10 investors at a million dollars.

Right.

Well, some would say, you know, it's as much work to write a $5 million check as it is to 50 million. You got to still diligence it. So especially when they're trying to put money out. But it, you know, it is challenging to break into that institutional space as well because you know, those funds are generally looking for, you know, the sponsors who have, you know, these long track records and you know, kind of check the box kind of thing. So, but look, I think to build a portfolio, there's no better way to show that you're active and are able to execute so well. Look, with, with a couple minutes left, would love to hear advice that you would give to investors. We have a lot of people, maybe, maybe they're they're watching on, on Instagram right now or maybe they'll listen later and they're thinking about making their first investment. What would, George, what would you say is the best way for someone to get into this? And maybe they're in college right now and they're thinking about doing their first deal or maybe they're thinking getting into the business. What would you say to them?

Them? So I would divide it up in a few answers. I would say that one easy way to do it is to partner up with, with somebody like us, we can learn the process. You know, any one of our Investors, even whether it be an LP or not, if they want to come tour, if we, we invite her, we keep the doors open. Like we, we try to treat all investors like family. So if you want to come through the door and see how we're repositioning the asset, you want to see, you want to ask questions, come on. And it's no problem. We don't, we don't filter if it's, you know, another good way is to go work for somebody, you know, without investing.

You can go work for a group.

And see how they, how they underwrite. But if they want to go do it on their own, which is, which a lot of people do, I would say that you have to understand the laws, which is the biggest thing in New York City. Understanding, you know, rent stabilizers, free market, you know, understanding how to navigate that process, which is the biggest thing, you know, department of building. Have a good architect, have a good, you know, an engineer if you need one. Know your numbers. Because again, at the end of the day, I think that when you first go into it and it's, we've gone through this exercise where we looked at an asset after we closed on it, looked at our under in the beginning and so how our underwriting was completely, you know, off when we just in our early stages, we were projecting, ended up not being the case. So I will say, if you're thinking about it, you could jump in because at the end of the day, the only. You can't replace experience. And when you're going to learn on your first deal, again, it's not going to be a home run, most likely, but the experience will take out of that will be. It's gold. And from there you're off to the races. That's, that's my advice.

Don't let, don't wait to invest in real estate. Invest in real estate and wait.

It's a good way to look at it.

So, and I just, to go back to what you said earlier there, so if someone listing right now, they had a great opportunity in Brooklyn, value add, multi deal, they source it off market and they brought it to you guys and said, hey, can we partner on this? Maybe, you know, Jeffrey, how, how would that go? Like what, what would you say to that person? What, what would, you know? Not, not that we need to hash out a structure, but just that's something that, you know, George is saying that you all would be open to.

I say yes immediately. And the reason is because this business about relationships and people wanting to make money and get involved and was they, when they do brokerage or they see an opportunity, it's kind of their way to say, hey, I want a piece of this or I want to bring something to the table. So I think by being open, whether it's with joint ventures, brokers, property owners, being creative in your deals, I think is a way you're going to get over some deals. And if I said no immediately, when the second opportunity, the third opportunity comes, I'm not going to get that call. But if at least I'm open to it and try to figure out a structure, may or may or may not work. But at least there's an open door for the next few opportunities to work on together. So I think always being open is important. The answer would be yes, could always reach out to us. We're open to doing deals with brokers or owners alike. And I think by having that mindset that you're not looking for every last dollar or you're looking to find ways to bring other strategic partners, like a broker that has a particular off market listing or relationship, I think is the best way to take things differently than just the normal stractal structure.

Yeah, no, it's definitely one of the things that I talk about right at the beginning of the book because I think that lack of capital, fear of not knowing what to do is what holds a lot of people back. And I know the first couple incredible opportunities that I saw as a broker early on in my career that I wanted to buy. Instead of reaching out and asking people, hey, do you want to partner and do this together? I just assume I got to keep this thing for myself because if I tell anyone about it, someone's going to just steal the deal and I'm going to lose out. And look, maybe that will happen, maybe that is the risk. But I think if that's your mentality, you're probably not going to get far. What I found out very quickly is 100% of nothing and still nothing. So, you know, I, I would encourage people to think about that as they're looking to get into things. It does start with the deal, Right. So if they're just calling, saying, hey, can we partners on a deal? You'd say, all right, well, we're already pretty busy over here. We got our machine, we got our pipeline. Like, what is your value add? Like, the deal is a great place to start. Right. To begin that conversation.

Absolutely. It starts with the deal. If you have something that's you bring to the table, why not? Okay, Jeffrey.

Advice that you would give to Someone looking to get into this and maybe it's, you know, where to start off. If it's big shop, brokerage, what would.

You tell us getting into investing? Yeah, I would say first of all start a little bit smaller, do something that you think is doable within your equity requirement or wheelhouse. If it's you want to get into multi family, do a two or three unit project, start small, understand that business. Because running a three unit building and a 30 year building is the same, it's just 27 more apartments. So I think starting small where it's a little more achievable and you deal with a little less, not a risk per se, but a little more manageable process and project. And for me, I mean my own advice that I try to give my guys is do a little bit more when you're trying to call an owner or look at another deal or when you're in the office and it's 6:30 or 7:30 at night, spend an extra 10, 15 minutes. An extra 15 minutes a day can add up essentially, you know, expense exponentially throughout a year. So I think putting in a few extra minutes every day or an hour or taking an hour before you start your week to prepare for your week will really help you. But in terms of investing, I think starting small, learning the process and like we did, we built from there a three unit and a three unit and an eight unit. We're closing something, 30 something units in hand soon. So I think just building on that and having the same consistency and mindset and also relationships and other things you operate in the public space is very important.

You know, what you said reminded me that atomic habits just getting a little bit better every single day. But again, going back to your point, it's the consistency, right? It's not just okay, I'm gonna get a little, I'm gonna work a little harder, you know, this week and then you know, hey, it's summertime on a take off. Like you know, again, the really good investors, they're really good brokers, they show up every single day regardless of what's going on the market and everything else.

So to jump off it. But sorry.

It's a great book by the way. Oh yeah, great book. Yeah.

So no, I was going to say I heard something interesting about Michael Phelps. Yeah. I don't know how many has eight gold medals. I think his most gold medals and.

He'S one Olympics, I mean he might have more than that, but yeah, something.

Like 11 in the Olympics and he was so consistent. He won A gold medal, his birthday, New Year's, Christmas, Thanksgiving, he was in the water. So I think consistency is a key until you know you've achieved what you want or you're, you're happy. But I think just achieving and doing a little bit more every week, you're going to start seeing that where you were a year or two years ago, where you are now, it's a totally different place because of that consistency.

Yeah, I think the hard work too and hearing the way Kobe Bryant was and you know, right after the championships, it was in the gym the next morning and showing up hours and hours before game time. So. Well, guys, this was really great. Annelies, I don't know if we had any questions as we kind of rolled through Annelies. Do you have any questions for Jeffrey or George?

That's a great question.

I haven't thought about that.

That's a great question. I may have to leave this apart too. Just off the top of my head, I could tell you that George a little older than I, so he comes a little bit more experience and in a lot of ways, not just on a business level, but on a personal level. I try to adapt a lot of things he said today, whether it's on, you know, starting day off positively or working out or just being more mindful for your internal machine that's going on your brain or your body than just the external. And for me it's been very successful. So appreciate that.

I would say the balance, I think we balance each other very well. Where we in business, like business, we think very similar but personality wise we're a little bit different and I think we balance each other. Jeff is very high octane and he's go, go, go. And I'm more of the calm guy and he's, he pushes and I'm more of the more of them methodical guy. So I think we balance it good.

Ying in the end.

So maybe you guys already then just answered this, but kind of the last question and to take us out, I mean the whole title of this book, the Inside edge that you can gain an inside edge to gain the advantage and outperform form the market. I mean, what would you say your insider's edge is to real estate investing? Any thoughts on that?

Insider's edge. Wow. Deep question. I would say our main skill, I would say what we're best at is truly understanding maximization of space and how to translate that into high noi I think we're very good at looking at an asset and think forward and understand what it could Be and see the potential right off the bat. I think we're very good at that, I would say. And. And I think our values makes. It separates us from a lot of people. And the way we think is. I think the way we think. Our honesty, our integrity that we put next to our name speaks to a lot. I think you combine those two things. I think that's a. That's an edge.

I like that. That just to add a little point to the second part, you know, it kind of refers back to the relationship part. I think having good relationships is your edge. There was a deal we're working on about a month ago in this village, and a broker that, you know, very active, called us up and said, look, I have a little egg in my face. I don't want to make this call. We're not able to give you the deal. We have a guy even lower, but he wants to do a deal with the guy that he knows from around the corner, and he's going to do it because they have a relationship. So we understand. We respect it. I saw the partner, two weeks later, he goes, I got to tell you something, guys. The way you handled yourself, the way you weren't screaming at me, cursing, trying to go around me to the owner, guys really act in a good decorum. We want to do business with you. So I think definitely maximizing opportunity and looking at asset, that's one of our edges, which comes with experience and hard work. But relationships, I think is a good edge because like I said, if you have. Let's flip the other side. If you're a buyer and now there's two capable buyers and the bids are due and they go into ownership saying, well, I have two buyers. Who are they going to deal with? A guy that has a good relationship, has been honest, consistent, following up, done deals with, or the guy that's just, I don't care if I don't do the deal or don't do the deal. So I think relationships and like you said, maximizing the opportunity in the building.

Love it. Guys, this has been awesome. If people want to find out about you, where. Where can they. They find you? Website social handles. Definitely follow these guys on Instagram. These guys put out some great stuff.

Yeah. So Kings Capital Re is our Instagram. We're redesigning our website now, so you're going to see a few changes. Kingscappler.com um, we're going to be posting hopefully this podcast soon and some more press. You can find us on LinkedIn. Georgianopoulos Jeffrey Zanati and we're here to connect with everyone and anyone.

Awesome, guys.

If you haven't bought the book, get the book.

Yes.

There we go.

We'll get you a signed copy.

There you go. Hey, thank you, everyone, for joining as always and sharing the word on the show. And this is really for you. We're doing this. And I'm so grateful for Jeffrey and George for giving time, sharing, you know, their experience, the Insider's Edge. And to quote one of my mentors, Rod Santomosimo, and his book, knowing Isn't Doing Right. So it's great that, you know, hopefully you're taking some notes and thinking about, but really think about putting this into practice. Right? That's, you know, actually, you know, taking action. So maybe that's something to leave you with for this week and we'll look forward to connecting on our future shows. Have a great one, everyone. Thank you.

Thank you for listening to the Insider's Edge to real estate investing. We appreciate your subscribing and sharing with your friends. If you haven't already, please connect with James AmesnelsonNYC on LinkedIn, Instagram and Twitter. Please also visit jamesnelson.com where you can find the show notes and other episodes along with an exclusive video series and other helpful resources so you can gain the insight. Insider's Edge to real estate investing until next week.