Doubling Down with Oren Neria

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 everyone to episode number 155 of the Insider's Edge to Real Estate Investing Today. Thrilled to have with us Oren Neria and once again this was brought to you live on Instagram. If you want to go, follow me at James Nelson nyc. That is where you can find the recording of that interview that took place in my office.

But here you're getting the recording and.

You'Re going to learn a tremendous amount about the competitive landscape for brokerage and neighborhoods around Manhattan and the success of targeting smaller, more efficient neighborhoods like Northern Manhattan and sub markets in Brooklyn. We're going to dive into Oren's experience in acquisitions and how he used rejection as his opportunity to grow with an eye on Brooklyn and smaller value add deals. Oren believes there are discounts to be had with with a bullish outlook on the market. We also delve into Orin's personal story including his experience negotiating his starting salary and the importance of understanding the principle of the company you work for. Oren's background he's principal and founder of my BK Investments. Throughout his 13 year career he's developed extensive relationships in the Brooklyn market and successfully purchased over 50 investment properties. He currently owns a sizable portfolio of mixed use, multifamily and and commercial properties in New York City. Before that, Orin was the Vice President of Acquisitions for G Way Management. He worked directly for the firm's founder on acquiring, developing and managing the existing portfolio. Over three years, Oren has led the acquisition team in purchasing over 40 buildings with a total value of over $100 million. Oren began his career in the real estate sector as an investment sales broker specializing in Upper Manhattan multifamily sales, successfully closing deals valued at over $150 million. So you can always find more information on our guests and where to connect with them@james nelson.com along with the show notes helpful videos of course you can also order my book through that site. Again, the whole point of the site as well as this show is to give you the insider's edge to gain the advantage and outperform the market. We're going to have a brief word from our sponsor and we'll get right into that interview with Oren Neria.

A different approach to Putting our Clients first Avis and Young's Tri State Investment Sales Group sells multifamily office retail development and specialty sales throughout the New York metro area. As experienced thought leaders in our 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 which promotes unparalleled collaboration and 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.

So now it's time for our investor spotlight and with us today is Oren Neria who is principal and founder of my BK Investment. So Oren, welcome. Thank you so much for being with us today. And welcome to those who are joining us on IG live.

Yeah. Thank you James. Pleasure, pleasure. Coming on.

Yes. So I know we were just speaking before, although your, your company and your focus has largely been on Brooklyn, you, you live in the Lower east side and we're, we found some common background in our friendship with Jim Kinsey who is incredible person and was a real loss but was wonderful that could was, you know, so many of his messages and teachings were here in the book and so was so happy to dedicate it to him. So I'm sure we'll get into your story and your interaction with Jim but why don't we start off if you could just tell us a little bit about your story, maybe where you grew up, how you got into the business so our audience can get a feel for your story.

Yeah. So again, thank you for having me on and congratulations on your book, the Insider's Edge.

Yes, yes.

I listened to it and it was, you know, I've been in the business for about 13 years and it's, it was great insight and it's always nice to be inspired.

Good.

Yeah, I enjoyed it a lot. So a little bit about myself. So I grew up in Israel. We came here in 1999. I ended up getting into real estate. You know, I would say part of it, you know, was in the family, in the blood. My, my grandfather was a developer for kind of middle class housing in Chile, mainly in Santiago. Yeah.

So you were in Israel but he was in Chile or he was going back and forth.

No. So so he was in Chile. My mother is Chilean.

Okay.

And she came as a 17 year old. She did an aliyah basically to Israel, where she ended up meeting my father and they fell in love. That's how we came.

Oh, wonderful.

Yeah.

So did you, at an early age, were you visiting and kind of seeing these projects going back and forth? You were.

I was, I was, you know, and, and hearing a lot of kind of his mantras about the real estate market and how he approached it. You know, it was always something that, that always stuck with me is the idea to specialize and to differentiate yourself from the competition and what elements do that, you know, in, in whatever thing that you do, you know. And, and he himself had an interesting kind of way of separating himself from the competition while building workforce housing. One of his ways that, that was intriguing to me and it kind of, it kind of is a lasting legacy is that he built units always about 15 or 20% larger than the competition, but priced it the same. And he would build very big and fancy kind of marble esque lobbies, even though it was, you know, very working family, middle class buildings, condo developments. And it really set him apart, you know, and he became known for someone who is willing to invest that extra, you know, money to make the space special, you know, for the tenants.

Wow, that's wonderful. And I love how he wanted to make it nice for them, make it larger. I mean, oftentimes it's what's the minimum? What's the least I can get away with? What's the most profitable way? But really thinking about the people who are going to live there and really giving them a sense of dignity and place, of well being. So that's, that's wonderful. So I'm sure that that has stuck with you throughout your. That was, must have been a wonderful thing to learn so early on.

Yeah, yeah, I think that stuck with me for sure. And, and those lessons were reiterated throughout my career. You know, I started my career in your field in the investment sales.

Yes. And this was. So you said 1999 was when you came to New York. So what was it that prompted that?

So we. My father is a professor today. He's a professor at Columbia University, does mainly research and, and he focuses on PTSD and trauma.

Oh, wow.

Field. I did not go into the academic side of, of the family, you know, field. And he was offered a position at Stony Brook University. So we came as a family. I came as a young boy, you know, as a 12 year old to Long Island, New York.

Did you speak English? At the time.

English. But I was determined to go to the NBA, so. Oh, wow. Okay. For the opportunity.

Got it. Who was your team when. When you came here? Kn or.

I was a big Michael Jordan fan.

Okay.

You know, so that's. That's who I was trying to. To follow. Wonderful. Yeah. And. And you realize very quickly that you are. That Israel is a very small country and the competition is very small once you come to the U.S. no, but it's good.

I love the ambition. So. So you end up playing in the school. Was that a way that you could meet some friends and kind of break in?

Sure, sure, sure. Yes.

Yeah.

Yeah.

Well, good. So. So you were living on the island, and then what. What did you end up doing for school? College. And were you already thinking about real estate or how did this come to you?

I was not. I was not. I think, you know, in my college days, I. I went to Boston University. I studied history and philosophy. Yeah. And I was trying to learn about the world. You know, I was very passionate about politics, about Middle Eastern politics. Coming from Israel and trying to understand that better. Trying to kind of grow as a person and always feeling like. Like business. Business and real estate is in my blood. So that's something that I can come back to and do it, you know, and. And devote my time to it, which is what I did after finishing school. I, you know, I sent a few applications. One of them was to ERG Property Advisors, which was started by four partners, James Kinsey being one of them, and the two Guarino brothers and Matt Sparks. And I joined the investment sales team, small brokerage here in the city.

So real estate wasn't really on your radar, but you were looking for a job. I guess you were looking to come back to the New York area. So you just. I'm curious, you know, for me, it was complete luck. I didn't know what I was going to do my senior spring. And there was a posting for Massey Nakla Realty, and the rest is history. But how did you even come across that? Do you remember?

It sounds very similar. You know, I. I decided after graduating from school, all my friends were already were set up with their job. And I told everybody that I'm gonna travel for six months and once I'm done traveling, I will focus on a job. So after finishing, I would say I traveled for about three months and got very antsy. Okay. And came back and I said, okay, now it's time to get focused. And found a few listings a little bit similar to you.

Yeah.

And applied and came in for an interview, was told, you know, a couple of days later that the position is available for me from. I wanted. And I started.

What was the on the job training and knowing the Gorinos and certainly Jim and spending a lot of time with him and Matt Sparks, who still, you know, I need to reach out to him because it's been a while, but he. Incredible. You know, these are guys who were activ. Active in the business, doing deals as brokers, lenders, principals. So I. I've got to imagine that your experience in the business from the start, I mean, this is real, really an immersion. So how was there, like, formal training, or did you just kind of team up with one of the brokers to kind of learn the ropes?

So there was. There was training, basically, you know what. What I came into was, was some team structure. Like, everybody had a mentor. My mentor was. Was Matthew Sparks, and everybody had a team, but you had to then figure out what. Where you want to focus, you know, where you want to specialize. That's one of the first times in my career in real estate and kind of became a repeating theme where I was trying early on to understand how. How do I want to differentiate myself from my colleagues, you know, in this case, you know, from the boiler room mentality. You know, when you have 25, 30 brokers in a room, everybody is eager, everybody's hungry, everybody wants to do deals and make money. And I remember thinking for. For some time, you know, everybody wants to focus on prime New York City real estate. So a lot of my colleagues, you know, guys that I love, were like, okay, I want the West Village and I want Rebecca, and I want to be in Chelsea, you know, that like the hottest market that there were. And I thought to myself, wow, I have a lot of competition here, you know, and everybody wants to be the big dog. Do I want my kind of ego to. To lead me in this case, or do I see an opportunity to do deals and to be. To have an impact somewhere that's. That's kind of less. Less traveled, you know? So I looked at New York City, at Manhattan at the time, and I said, you know what? Nobody wanted upper Manhattan. Nobody wanted to focus on the Harlem, Hamilton Heights, Washington Heights, Inwood. I said, you know what? That those will be my neighborhoods I'm gonna welcome. I'm gonna get to know them, you know, and I will become an expert in those neighborhoods. And that will be one of the first things that I do to try to differentiate myself from my. From my colleagues. You know, I Love that.

And for those of you who are just joining us on IG Live, I'm here with Oren Neria from my BK Investments and you're seeing live our podcast recording. This won't air for a couple weeks, but you're getting a sneak peek and we're also, you'll have the ability to ask questions later if you like. Now, Oren was just talking about the, the competitive landscape for brokerage. And I love the fact that you analyze because if you think about it, there's really two parts to it, right? There's the actual opportunities. So how many sales can I actually broker or as an investor? And maybe you'll tell me the same as you got onto the principal side, what type of opportunities existed? But then what's the competitive landscape? Who am I competing with? And you know, anecdotally what you're telling me, the fact that most brokers love focusing on Manhattan. They love downtown, they love the Village, Soho, Tribeca neighborhoods. And there's probably, you know, there's only so many sales, you know, so that's really interesting that you said, I'm going to kind of go in some of the areas that are maybe not as well covered and efficient. So how did that go? I mean, you're, did you write from the get go? Did you find success in getting listings or was it mostly off market? What kind of deals were you selling up in the Bronx? In northern Manhattan?

Yeah, northern Manhattan. So what I realized is that a lot of the bigger buildings, the prime buildings, you know, on Broadway, on Riverside, on Amsterdam, at the time, a lot of those owners were kind of bigger owners, you know, that owned multiple buildings or almost type of institutional owners. And they had their brokers, they had their people that they're calling. You know, I would probably guess that you were one of those brokers that they would be happy to call because they own the, you know, large buildings uptown, they own nice buildings in Tribeca and Chelsea and there were similar owners. So for me, as, as, you know, as a 22 year old that's hungry, that wants to, to find listings, you know, to, to be able to call up people and tell them, hey, I have a building for sale, you know, and, and get through to them, I realized that I have to again, differentiate myself and find the, the one or two building owners that I can give them something useful and that they will give me the opportunity to represent them. So I was going after the smaller guys.

And what was your pitch? Were you just calling them, saying, you know, I'm a broker at erg, are you interested in selling your property or what. What was kind of your opening?

You're bringing me back in time. So I would say at the time, my opening for the most part was. Was getting rejected.

Which I forget who was. You said the more nos you get, you won. No closer to a yes. So, yes, there is a numbers game involved in this. So you were reaching out and you were. You were just calling, offering other products you had available or saying, yeah, so.

I was taking product from. From Matthew Sparks that was letting me, you know, use product that he had, you know, through his connections and kind finding bridge, you know, to be able to get in there. But I would say. I would say one of the first things that I kind of really experienced at that time and, and made me grow was getting rejected, get. Getting told no, getting hung up on. It's. It's a very. It's probably one of the first times in my life that I consistently got rejected. You know, and it's an interesting experiment, you know, how to handle that, how to handle that emotionally, how to keep yourself motivated and keep yourself hungry while getting told no. 95, 97 of the time. And it's something that I believe now on the principal side of things has made me much more appreciative and, and much more consistent and, And. And made me value so much my network of brokers, you know, and smaller brokers that I work with, because I know what it feels like.

So you're saying all the brokers who are listening to the show right now, they're gonna track you down after this. They're gonna say, I know Oren's gonna take my call and he's gonna be nice to me and not hang up on me because you've been on the other side. So how did you deal with the rejection, though?

It was tough in the beginning. You know, you have to get to a place where you don't take it personally, and you have to realize that it's a numbers game. Timing is very important. You know, you have to try to understand that again, that it's not personal. You know, people. People have their processes. A lot of the. A lot of the owners are legacy owners. And why, you know, if they own one or two buildings, why do they want you calling them, you know, and trying to offer them something that they're not interested? Right.

So, yeah, I think I once had the chance. Barbara Corkin came and spoke to our office, and we asked Barbara what was the number one thing for the. The common trait for brokers to be successful. And I think this applies to anything in life. And she said it's how they handle rejection. And she noticed that there was a lot of brokers who, if they got, you know, hung up on or they lost a deal, they got down in the dumps and they said, I got to take off the rest of the day or. And they eventually just didn't make it. And those who were the absolute top levels were resilient. Right. And they were willing, they understood that, hey, this is just part of this. And sometimes you're catching some at the wrong time. Or maybe you're the sixth person who called them that day. And you know, it's to your point, you can't take it personal. So I'm sure that's probably stuck with you throughout your career. I mean, now you're on the other end, like you said, of the equation. So let's talk just to round this out. Your experience at erg, how long were you there before? Was it from ERG that you transitioned onto the principal side? Were you kind of brokering, doing some principal work at the same time? What, what was that? Moment of enlightenment, if you will.

Sure.

To start investing.

So I was at ERG for about three years and then we made a jump to Eastern Consolidated.

Okay.

With Matt Sparks at the time.

Good.

And I, that's, that's the time where I started getting to know developers and kind of the other side of things, you know, brokering deals, doing deals, forming relationships. And I got in close with some, with a developer that works in Brooklyn that owns a large portfolio that I sold the building to in Upper Manhattan who wanted to go bigger and wanted to recruit me as his acquisition guy. So it kind of opened the door, you know, when I decided to make that jump after, after a bit of negotiating, you know, starting salary and, you know, feeling that in order to make that jump from, from commission based compensation to a salary compensation, you need to realize that, that your upside suddenly feels limited. You know, starting out as a salary employee, even though there could be bonuses and all that, you know, as part of it. One of the things that I loved about, about the commission based work is that the upside felt unlimited. It was up to me, you know, it was up to me to make things happen. And you're kind of the first time that you're your own boss, you know, in a way, like you are the one that can contribute to your success. But I, at the same time, I knew that I am getting an education, you know, from someone who I really thought was incredible at his work and, and a mentor of mine until today. And I'm getting a type of, you know, mba, you know, in real estate, getting paid for it and having fun doing. Yes.

So, Oren, I bet there's a lot of people listening to this right now, and maybe they're brokers or maybe they're college students and they're thinking about getting into acquisitions, which I think is a great way to start off as an investor is working for a more established shop, you know, understanding how someone does it and getting to do some of the fun stuff, going out and finding the opportunities so, you know, to what extent you can share. I'm not asking for actual numbers on compensation bonus, but, you know, I, I'm sure a lot of people, if they're looking to go that track, they're also thinking, I want ownership, too. So was equity ever a discussion? Like, did you ever say, hey, if I find an opportunity, do I get an extra, you know, point or two on the deal? Is there something where I can get some sweat equity and actually be a part of it? Just to be helpful for our listeners.

I would say for me, early on it was, you know, it did turn into that, but early on it was about, you know, starting at a relatively low salary, you know, and with the idea of proving myself in the first six months, like, am I able to bring deals? Am I able to go to the acquisition side from the broker side and make things happen. And after, after that time frame, then there was a whole new discussion of, yeah, putting together a structure that makes sense where you can get sweat equity, where you can invest your own money into a deal, you know, where as they come, as you bring them or.

And I'm really glad that you shared that because now, again, for those of you who are listening or maybe thinking of this track, I would imagine going into an investment shop and day one saying, okay, that's great that you give some salary and some bonus, but I also want some equity. And they're going to say, you know, I don't even know who you are yet. You haven't proven yourself. So I like the fact that you said, hey, I'm going to go in, and I understand this is a cut probably maybe from what you were making brokerage, whereas you said the sky was the limit, so you're now taking a no reduced salary, 50% over 50% to prove yourself. And I think so many times we think about, oh, well, I, you know, I need to make sure that I'm getting every last penny. But I like also how you explained this was almost like an mba. This was, this was your training. So, okay, so you're there six months, you've clearly proved your worth. And how did you prove your worth? I mean, what made you such a great acquisitions person? Were you able to source, deal flow, cultivate relationships? Talk about what made you a good acquisitions person?

I think it takes time to, to you need to do, you need to work on a few fronts. You know, first of all, you need to understand the, the principle of the company. You know, like the, the head guy, my mentor, you know, how, what is he looking for? You know, what makes sense for him, you know, how does he see the market? I needed to get on board that. The Brooklyn submarket is, is an incredible market, you know, because I was an expert in upper Manhattan and the majority of the 80, 100 buildings that they own, 95 of them was Brooklyn based. So I suddenly had to, you know, I was doing the reverse commute into Brooklyn now from Manhattan, I was going into Brooklyn. And I suddenly realized that Brooklyn is, is full of energy, full of entrepreneurs, full of interesting people with stories. I, I started understanding a few facts. You know, I, I understood first of all that Brooklyn as a, as a submarket, you know, is if it was a standalone city, Brooklyn would be the fourth largest city in the US that nobody really understands that because we are next to Manhattan, you know, and, and Queens and the Bronx and. But Brooklyn has almost 3 million people, you know, by itself. So I need to get on board that Brooklyn is an interesting place that, that, that I'm now getting to know. The second thing was we were getting priced out of the deals with a lot of brokers at the time. You know, we were, I was working a lot with the, with the shops, you know, from, from, you know, Eastern Consolidated and Massy Naco and those guys that we were bidding on kind of the bigger rent stabilized product. You know, this was 2015, 2016, a lot of cap rate compression at the time, you know, and we bought a couple of those buildings, but then we kept on losing out on bids. You know, as cap rates were going down, there was more competition. And I realized I can't do my job if I continue down this line. I have to differentiate myself again, you know, so I started, I started exploring a different asset class at the time, you know, and, and working closely with, with the principal of the company, we started looking at much smaller deals where we had much less competition, you know, from the bigger guys. So said, okay, I don't care how small the deal is, but if the financials make sense, you know, I will buy it, you know. So that led me into the smaller, like mixed use, taxpayer type of buildings and, and focusing on, on the more tertiary neighborhoods of Brooklyn that we felt, you know, going along, along with a subway, you know, that are within like a 40 minute commute to, to Union Square and Grand Central. You know, we're going to just go along the subway lines, you know, understand, understand the, the submarket that we're in and we're gonna buy these small mix use buildings, you know, that have a retail component on the ground floor, a few apartments above free market, you know, under six units. And we're just going to buy them in volume. So I had to develop all new relationships, you know, for these smaller type of products. So I was buying buildings, you know, that were priced from half a million to $3 million, where all of the big guys or most of the big guys just ignored them because they did not make sense for them because they couldn't buy them in bulk. They had to, you know, cut out big equity checks. And suddenly, you know, that flipped the switch and we went from buying, you know, one or two deals a year to buying about a dozen deals a year. You know, like we were closing one deal a month. And, and the pipeline just kept on expanding.

And these were all kind of more mom and pop brokers maybe. I know some of the, you know, the residential brokerage firms out there, they sell an apartment, a co op, but then they get, you know, a little multifamily or mixed use. So I would imagine probably less sophisticated overall and probably a lot less competition. They were probably happy to hear from you.

And, and yeah, exactly, exactly that. And some of them are not necessarily brokers, but, you know, they, they go to the local church and they know someone, you know, that's, that's in a situation, there is a divorce or there's an estate and somebody needs to sell a building quickly, you know, so they know that. There's this guy, Oren, you know, if you give him a deal, this guy, if he tells you he wants the deal, he will pay you a fee, you know, like he knows that Orin is there, you know, and I will, if I give my word, you know, I'm there to transact and you start building a reputation, you know, for someone who is a closer, who is hopefully gonna stand behind his word and separate yourself.

Now, did this end up. So did this partnership just evolve or was there a point when you said, okay, I'm going to start because maybe Give us the, the history of my bk. And for those of you just joining us on IG Live here with Oren Area and we're talking about his story and advice for aspiring investors for our upcoming podcast. So at what point did you launch your company? Or was this just kind of the evolution with the same partner and you just, yeah. Did more and more talk about that.

Sure. So I decided, you know, so we got to an inflection point, you know, in the partnership where, you know, the, I, I was looking, you know, for more than he could give at the time, you know, and at the same time we, I was asked, you know, by, by my mother, you know, to give a hand in the family business, you know, some family business that's operating in Chile, in Santiago. So I used that opportunity to take a few months to go to Chile to help with the family business and to kind of understand what will be my next step and that that was the evolution of, of my decay investments. That was the start of it. I came back and I decided to give it a go, you know, on my own.

And when was that?

That was 2017.

Okay, so when you thought about incorporating your new business, I mean, was there a thought out business plan? Did you say, I'm going to just keep doing what I'm doing or did you have a vision of what you wanted to create?

I, you know, I definitely had a plan. You know, plans change. Plans change. You know, I, I, I'm a big follower, you know, and I enjoy a lot of Mike Tyson.

Okay.

You know, and Mike Tyson has a famous line, you know, where he says.

I think I know this one, you.

Know, this one, he says, everybody has a plan until they get punched in the face. So I would say, you know, starting my company, I definitely had a plan. I felt like I had a vision, you know, that I'm gonna go out there and I'm gonna, you know, produce deals and I'm gonna do value add deals and, and renovate, you know, and do all twos and get punched in the face doing old ones, you know, understand, you know, get bruised up on certain parts until you get to a place where you, you persevere. As we said earlier, we need to persevere especially, you know, when, when we get hit in the face and, and come up, you know, with different strategies, different solutions to kind of navigate that and find our, our expertise within that.

So you had your business plan and repositioning these smaller, you know, mixed use properties that, you know, what's really interesting about the inefficiencies of this market. I mean, what I'm hearing is you were able to capitalize on those opportunities because they weren't, you know, broadcasted and, you know, mass marketed in the sense that you really felt that you were getting in at a good basis and you knew what to do with them. What was your investor base? I mean, was this. Were you raising money from investors? If so, maybe share with our audience what that was like, maybe how you were financing these deals. Talk a little bit about that.

Sure, yeah. So starting out, you know, it was friends and family, where you kind of say, you know, I. I was starting out in on the syndication front. So my idea was first of all to. To have some feelers out there, you know, of if I find interesting deals, would you be interested in putting in some money? Trying to get a few people on board? And a lot of people, you know, it's interesting, once you start throwing out feelers, you know, a lot of people do want to get into the real estate game. You know, I think there is an understanding that, that real estate and New York City real estate is something that's, you know, that's just, you know, holds so much value and, and. And it's very attractive, you know, for that being said.

I mean, because I. I haven't heard a lot of people have said they enjoy the process of raising money or asking people. So, I mean, friends and family is one thing, but I mean, I've got to imagine you probably had your fair share of rejection when asking someone if they wanted to invest in your deals. And, you know, maybe it was a good friend who you just thought, of course they'd invest and no. So, I mean, can you talk a little bit about kind of your success, you know, rate there and what that was like?

Sure, sure. So let's take. Let's take, for example, you know, foreign. Let's take, for example, you know, what happened to us early in 2020, you know, with COVID You know, the business is still relatively young, and I'm still, you know, calling friends and family, you know, to raise money for deals and working with specific banks. You know, it was the beginning of 2020, and Covid hit and. And there was a lot of noise that. That New York City, you know, and metropolitan life is now over. It's changing. New York City is dead. You know, we should all be terrified. You know, and it was a scary time. And I remember calling a few of my investors at the time because I was. I was really bored. You know, I'm a little bit add And I want to get things done. And I tried to get deals done always. And I remember calling them and, and telling them that I am out there looking for deals. You know, this is like April, May, June, you know, and nobody is buying anything. And I said, listen, I remember talking to a couple of investors and saying, everybody, they're telling me that, that New York City is dead. And I said, listen, I think that there could be major change on the horizon. And I, I wouldn't deny that. But at the same time, New York City is such a staple, you know, and it's like in the heart of the world, you know, from an innovation perspective, a business perspective, you know, entrepreneurial spirit, that if things are over, then, then things are over, you know, then, then, then, then whatever money that we put on the street right now, then, then we made a mistake. But that means that everything is done because New York City is at the heart of it. And if the heart gives out, the heart gives out. At the same time, I'm out there on the street and I'm offering people that, that believe that it's over, you know, $0.50 on the dollar, you know, for, for these smaller buildings and nobody else is bidding. And I'm getting offers accepted, you know, left and right. And suddenly I have, you know, four accepted offers, you know, between May and December, you know, and I'm going to the banks for, for financing like, like I would, you know, and trying to structure the deals, trying to get a few investors on board. And my discussions with the banks were some of the most interesting discussions that I realized, you know, I realized what it means, you know, even when you feel that, that you've been a good performer with the banks and they were type of partners to you, you know, And I'm talking about some of the big institutions that unfortunately are now having their own difficulties from First Republic and Signature. You know, I remember calling my guys at those two banks which lent me money before, and we repaid that money and they saw us make money and telling them about the deals that we found and the deals that we have under hard contract that we need to close. And they're telling me, well, your retail is vacant. And I said, I know, you know, like, we, we're buying vacant retail, we're going to renovate it, we're going to put a new storefront, we're going to do our thing. And they tell me, well, if you want a loan, we're going to value the retail at zero. Right, right. And I said, what do you mean they're like, yeah, retail is dead. You know, we, we have to value it at zero, right? But I said, how can you say that? This is mom and pop retail. This is our, you know, community oriented retail. You know, Brooklyn needs its retail. You know, you, you need accountants, you need the, you need a deli, you need, you need a pizza store. Are you telling me that there is no more retail? They're telling me, yeah, zero. And we're willing to lend you on that apartment. So at a 25 LTV, you know, and I realized, wow, I am under hard contract though. On the first two deals I went hard. I put my own money and I'm gonna get no financing, you know, and it was a really scary time. And that's when I had to really start getting on the phone and try to persuade a couple of investors, you know, of this like, contrarian type of outlook of like, it's true, we're gonna need to buy them all cash, you know, but we are at a basis that, you know, six months ago these buildings were worth double than what we, than what we're paying. And we have a value add, you know, component to them. I believe that, you know, that things are going to bounce back, but we're taking a gamble.

This definitely reminds me of the Warren Buffett quote, right? Not to say that you were being greedy, but you were out there investing when everyone was fearful. And even today, I mean, with rates going up since last June, I mean, I would say three quarters of the buyers are just on the sidelines. And so, you know, look, those are the times when you want to double down and, you know, continue to stay proactive. So, you know, I'm sure, I'm sure those bets certainly paid off.

So, James, on that note, this is the time where like my bk, the company is doubling down because I'm, I'm taking a similar outlook, you know, where, you know, six months ago, eight months ago, you know, people were, what we call it, on their knees, you know, begging for a 5 cap, you know, and fighting each other. And these days you can go and buy a renovated building with some operational, you know, upside for a six and a half, seven cap, you know, it's true that the banks are not there, you know, and, and maybe you're getting a 50 leverage. But if you're coming equity heavy and you believe, and you believe the discount is built in and you're buying good assets, you know, those are the assets that I want to own. Great. So that's what I, you know, I'm a big believer in In New York City, I'm a big believer in Brooklyn, you know, as its own, you know, city full of entrepreneurs, full of people, you know, that, that are hungry to, to, for the next evolution, you know, and I see it every day. Like I see it in our, you know, we own a couple of dozen small stores in Brooklyn. And it's always interesting. I interview all of our store tenants, you know, when they apply for, for that store, and each one has their own story of, of the business that they hope to make, you know, and, and it's beautiful to see it, you know, and it's, it's a range of people that, you know, from different backgrounds that they all have a vision. It's mainly mom and pop, you know, type of businesses that, that I am giving them the opportunity because our stores are renting, you know, I don't know, under $3,000, you know, a pop, for the most part, products, you know, small retail stores. You're giving them an opportunity to start a business that will hopefully become something bigger. And they all want to become bigger and more successful and give something to the community, to their family, to their legacy, to their kids that's better. And it's nice to be a part of that. And you see that spirit, you see that energy and, and I believe in it, you know, like, I, I love it.

I, I, I love that perspective. And I don't know if it was, you know, Bruce Ratner, my first interview, who talked about kind of, you know, changing the landscape and feeling like you're part of it. And sure, you know, it helps when you're building skyscrapers, but even just in the communities and improving, you know, the stock there and renovating, you know, some of these buildings that I'm sure 100 plus years old and bringing new, you know, retail and things to the neighborhood is, you know, a really wonderful way to look at it. So, you know, Oren, the, so the title of my book, the Insider's Edge to Real Estate Investing talks about, you know, having this inside edge. And I think you did tell me that, that you were, you said you listened to it on Audible over the weekend. So maybe that was at times four speed, if you, you know, ripped through it. But what, what would you say your inside edge is? What, what has given you the advantage throughout your career?

I would say, I would say you gotta persevere, you know, when, when you get knocked down and kind of believe that, that you'll figure things out. And a lot of it is having great mentors. You know, I think that's that's really important, you know, to kind of be there for you and help you learn things that you just otherwise, you know, wouldn't know and, and becoming an expert, you know, in your specific sub market and realizing, you know, what, what can be your edge, you know, what do you bring to the table? Are you a great, you know, people's person? Can you develop, you know, relationships like a local network, you know, of, of brokers, of people that will think about you the first deal that they get. They know. They know. Okay. You know, I know that Orin is the guy that likes these kind of buildings. He'll be my first call, you know, like, are you, are you investing in those relationships and making sure that, that, that you respect the people that you work with, that you're there for that call and you make it fun, you know, you try to make it fun.

But I really like what you were saying earlier about, you know, people just knew that when you gave them your word that, you know, the deal was going to happen, they'd be taken care of and, you know, really important, certainly, if you're looking to build your business. So. So we'll give a chance to anyone who's on IG Live right now if they have any questions. Anneliese, I don't know if there's anything in the comments, but while we're looking for that, or maybe you have a question. Annalise, I'll ask. One of my last questions would be. And I think you've already answered it to a certain extent. But for those looking to get into the business, what advice would you give them? Someone who's looking to make their first investment. Maybe it's a broker watching or listening right now who are thinking about dipping their toe in the water. What. How would you advise they go back that first one?

My first advice, I would say, is read your book.

Oh, thank you.

Or listen to it if you want.

To come back on this podcast. You're. You're welcome anytime.

I appreciate that your book is super informative about, about the process, about some battle scars, you know, of what it means. And I would say find somebody who is, who's been in the rodeo, you know, for, for some time, who had his own experiences and make sure that you like that person. Because real estate is not a short term game. Right. And I would say, you know, whoever you partner up with in the beginning, you know, to, to buy that first deal, make sure that it's a person that you enjoy speaking to, you know, and that you feel is honest and has integrity. I think that's really important because there is a type of marriage, you know, in that process, both to the real estate and to your partner.

You know, that's, that's fantastic advice. And I don't know if anyone's. We're over 150 episodes on the show. I don't know if anyone has put it that way. I mean, I obviously have having the right, you know, people and partnerships. But, but you're right. I mean this is not, this is a longer term plan. There's physical, a physical asset and it's, it's not like if things don't work out, you say, okay, we're going to just go our separate ways tomorrow. I mean these things take time. So yeah, choose, choose your partners. Well, well. Or this is fantastic. Annalise, I don't know if you have any questions or if there's anyone on, online. You got any, anything on your mind that you want to ask? Oren?

Yeah. So now, you know, as I mentioned a little bit earlier is that we are, we are doubling down, you know, on, on our strategy on the market. We, we believe in, in some of the tertiary neighborhoods in Brooklyn, you know, from Bed Stuy to PLG to Flatbush, you know, where we have a strong presence. We are looking to go bigger. We, we see it as a great opportunity to, to be in the market and to make things happen.

I love it. Well, I'm always thinking about what I'm going to entitle the these episodes and I'm thinking doubling down. I just, I just like the. Either that or it's what happens when you get punched in the, when you get punched in the face, maybe something like that. But no doubling down. So Oren, you got an incredible story. I love your approach and your way and I know people are going to get a ton of value out of this episode. So thank you for joining today and thank you for everybody tuning in. This is your host, James Nelson. If you've not already, please follow. Please rate the show. That's also how we get the word out there. And if you're listening to this now, if you email Ann, that's a n N E james nelson.com. send her a copy of that review along with your mailing address. I will send you a copy of this book signed. A lot of you have already taken me up on that offer, so but it is the way that we get the word out and help make you the best possible investor giving you that inside edge. So until next week, thank you again for joining.

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