The Stock Market Of Real Estate With Mor Milo

What's up, you guys? Welcome back to the podcast. I hope everybody had an enjoyable holiday. I know everyone's sitting at home in front of their TV right now, so thank you for joining us. The New and Experienced Investor Podcast. We are the number one live podcast in Laguna Hills. So congratulate us next time you see us.

Congratulations.

Thank you. Yeah, we're we're a real estate investor podcast that brings investors from all walks of life together. I'm one of your hosts.

I'm Alex Barnett.

I'm the new guy.

And I'm Joe Holmes. I guess that makes me the experienced guy.

Sure does.

Okay. Welcome. Welcome back.

Welcome back, everybody. How was your? Your get-together yesterday. Good. Nice.

We had a good time. Okay.

Glad to hear that. Glad to hear that. I hope you guys all enjoyed yourselves. We have an amazing guest in here today. He's talking about a new revolutionary way to invest in real estate. It's going to blow your minds. Before we bring him in, let's talk about our meetup really quick. January 20th.

January 20th, 2024. We don't have a speaker yet.

Yep.

You got the old flyer in here.

Oh no, I know. Yeah, so we can talk about what we did last time.

Yeah, we have to find out who's going to speak next month, and we'll blast that out and let everybody know.

There you go. But the last meetup was really cool. It was this last Monday.

The last meetup was crystal ball predictions and stuff.

Yeah.

And I think we had like 50 people signed up, but only half of that showed, which is not unusual. I mean, it was honestly the day before Christmas Eve.

Yeah.

We had a good time.

Yeah, it was really good.

At least I had a good time.

I think everybody enjoyed it. And having the smaller group, it was easier for people to connect, I noticed. So that was pretty sweet. And it's up on YouTube right now.

Yeah, if you want to see it.

Yeah.

I made some bold predictions.

Oh yeah.

I'm calling them bold predictions.

Yeah, yeah, yeah. So then we're gonna quiz you at the end of next year and see which ones you got right.

I'll just look at the video before you start quizzing me.

Yeah. So we'll see how that goes.

Yeah. I did make a prediction that the interest rates were gonna be down to 5%.

Bold.

Bold. But I did see BiggerPockets put out a prediction of 5.5%.

Oh.

So they didn't go as bold as me.

That's right.

5%, that's what I'm predicting, 5%. We'll see what happens next year.

That's right.

Yeah.

Okay.

We'll see.

You heard it here.

I think there's going to be a big giant turnaround in everything, the economy, everything.

Well, I hope so. My bank account could use it.

Yeah.

So I would really enjoy that next year. Uh, enough of that. So let's bring our guest in. Super excited. Um, he drove all the way from down the street today, so we're really lucky to have him.

Respect, man.

Truly respect.

It was far. It was far.

Right. Yeah. You got the crazy holiday traffic right now. So, um, yeah. Thank you so much. Uh, Moore Milo, welcome to the podcast.

Great to be here, guys.

Yeah, absolutely. Why don't you go ahead and jump on in, let everybody know kind of what you were doing before you got into real estate and how it's going right now?

Yeah, more than happy to. So my name is Moore Milo, and I am the CEO and founder of a company called Reli. And what we're doing is building the stock market of real estate. We would like for everybody to participate in real estate investing, me first and foremost. So I actually am a tech startup founder over the last 8 years or so, dabbled a little bit in the corporate world as well. But over the last 8 years, I spent a lot of money building startups, some of which went decently, some of which didn't go so well. And I had an opportunity to purchase a piece of property about 8 or 9 years ago for $100 grand cash. It's probably worth about $400,000, $500,000 today. And about 3 years ago or so, I looked back on that And said, you know, I really wish I'd own that piece of property. I really wish I had that. And that kind of started my journey with my business partner that I've been working with for the last eight years over the last four different startups to better understand the market, understand what real estate landscape looks like for an average Joe like myself to get involved, get my foot in the door. And what I discovered was it's quite quite difficult unless you have a rather large sum of money. And in order to be able to participate, you really have to take on a lot of responsibility as well. Become a landlord, manage a piece of property, maintain— if you want, if you want to go that route, right? Obviously, you can flip, you can wholesale, you can do a lot of different things. My family happened to be landlords. And that was the method that I thought would be best for me. And then I came to realize that I really preferred the model of investing through stocks or cryptos or, you know, different mutual funds, looking and digging through different securities that I could participate in. And I would really love to give my money to somebody that actually had a track record and was capable of delivering great returns like they would for their high net worth investors. And we discovered that there weren't a lot of places where someone like myself could go and put $500, $1,000, $5,000, $10,000 even into some form of real estate-backed security that is directly affected by a piece of property, a hard asset that exists in the world. The majority of opportunities that were available were maybe you could invest in a REIT and you had to trust a sponsor to go and deliver a bunch of money to a bunch of different people. But we wanted to diversify. We wanted to be able to gamify our experience. So we went on this journey to try to build this platform. And so far, 3 years in, we're, we're in a wonderful place. We just launched our first product, we have our first investment opportunity with a great group out of San Diego that's building affordable housing. And we're on our journey to truly putting American land in American hands and giving everybody the opportunity to invest with any budget. in really highly vetted quality real estate assets across the country. So that's what we've been up to for the last couple years. And that's what brought me into real estate. I actually have no background in real estate up until 3 years ago when I dove headfirst into the capital markets and finance side of the business.

Love that. Yeah. Well, I mean, I think real estate could really use, you know, fresh, you know, pair of eyes, you know, fresh technology, all that kind of stuff. Because You know, and not a lot's changed since the beginning of real estate from what I could tell.

They're not making land anymore.

That's true. Yeah.

Yeah.

That's one of the big ones.

They just made land once.

Mm-hmm.

And that's it.

Yeah. Until we go to Mars.

That's what we were talking about today.

Yeah.

Oh yeah.

The first real estate developers on Mars.

There you go. That's coming.

Elon's on the forefront.

Yeah.

Making it happen.

So, and I, I like American land. In American hands. That's pretty cool.

That's our game plan.

Yeah. Okay. Can you elaborate on that?

Yeah.

You know, I think to your point, they're not making any more land. There is quite a bit of land available to do stuff with though, which is pretty exciting. If you look at the United States specifically, there's a lot of development in a few massive metropolitan hubs and some stuff close to those hubs, but A lot of open space. And in the world that we're currently living in, you don't necessarily need to be so close to a metropolitan hub anymore. With remote work, with the way that things are going in the just employment landscape, we can get a little bit more creative. So I think number one, developers are looking for great ways to create awesome assets that generate a profit but also do well for Americans. You know, build great properties that people can live in, explore, buy things in retail facilities, have experiences. For example, surf parks. We have a surf— a couple surf parks that are interested in raising capital from surfers to build a surf park where those surfers can then come and enjoy that facility. And I think there's lots of land. There's lots of great applications for that land. And there's lots of people that want to participate in real estate, but maybe don't have the know-how to go purchase their own property, don't have the know-how or time to go flip or wholesale, but might want to participate in a fractional way, in a passive way, in pieces of property that might be interesting to them. Maybe you're a golfer, you want to invest in a golf course. Maybe you live in Tennessee, and you think your backyard is the best place to build ever, but you don't have the know-how. Okay. Come find a developer to invest in. Come find a sponsor that you can give money to that's highly qualified to build based off of your thought process. What do you think is going to be the next thing in real estate? So I think that there's a lot of opportunity. You know, with data centers coming down the line, there's gonna be a lot of technologists and people that like technology that will have the opportunity to invest in continuing to grow all the infrastructure that we need for for new technology to come to light. It's all based in real estate. It's all real estate based. It all needs land to operate. So we want to be kind of that backbone for the financing of American businesses across the country by giving access to average Americans to invest in those American businesses. So that's really the name of the game is how do we keep this money in the ecosystem creating amazing property for people to use, but also Creating investment vehicles where we have American businesses thriving and average Joe Americans investing in hard assets.

Yeah, that's, that's, I think it's great because you, you're totally right. You know, when people look at just getting into real estate, they're, I think that the number one thing that they say is, I don't have enough money to, to do it. So maybe you did save up $5,000 and instead of putting it putting it all on Doge. You know, you could put it in—

Please don't put it all on Doge.

You could—

Please don't put it all on Doge.

You could, you know, you could put it into something that you enjoy. Now, is this like an app or how does that work? What does that look like?

Web-based, super simple. You can just hop onto relli.co, www.relli.co, create an account and check out the different offerings that are on the platform. And today we have one excellent offering for accredited investors only, but in the very near future, we'll have our first crowdfunded opportunities invest in with as little as $100.

Now, if Joe and I have, like, a flip that we want to get funded, is that something we could put on your platform? Like, does it work that way?

That's a great question. That's exactly how it works. So the beauty of this is, for example, Joe, you have lots of experience flipping homes. If you were to decide that you wanted to create an incredible investment vehicle for average consumers or accredited investors to provide you with funding so that you could leverage your talent in flipping homes to go generate a profit for those investors, Then we could support you in listing that offering on our platform and advertising that offering to accredited investors or also to the mass public to invest in those different deals where Joe would be the sponsor of that specific investment opportunity and Joe could deliver a return back to average consumers or accredited investors.

Can you define real quickly what an accredited investor is and a non-accredited?

I'd be more than happy to. So an accredited investor is essentially, it's a designation from the SEC where a household or a person has over a certain amount of income or a certain amount of net worth. The income requirement for a single person is $200,000 and $300,000 for a married couple, and over $1 million in net worth and assets outside of your own residence, your own home. So if you qualify with that type of net worth and that type of income, then you would become an accredited investor, which would allow you to invest in alternative assets like real estate investment funds that are available to high net worth individuals.

And do you know when that rule or law or whatever you want to call it came into place?

It's a great question. I couldn't tell you the date, but it's been around quite a long time.

Okay, and the reason I ask is because I was investing in different things 40, 45 years ago, very similar to what you're doing. Prudential Insurance, they're not even around anymore, I don't think. American Express, there was big companies out there that were doing very similar stuff, but they didn't have any accredited designation. And I think, 'cause I never ended up making any money on any of that stuff.

Me neither.

I think that's where it came from. was, you know, they were back then, they were taking money and, you know, it's like, here, we're going to give you this return back. And they were nice returns. And that's probably one of the first problems is like, if they're offering you a big giant return, then you should be actually looking into this. So in your fund, let's say Alex and I wanted to do that. Is there a place in there where you, you kind of want to vet me? You, you want to say, okay, we need all this info from you, Joe?

Absolutely.

To make this more attractive to somebody else?

That's absolutely right. So first things first, fund would not be mine. The fund would be yours, Joe.

Okay.

So your background, you would go and build out that fund in your name with your track record, and then you would bring that fund to us and we would support you in advertising it. So the best way to think about this is the precedent that we're setting here is like the stock market. If I go to my Fidelity or my E-Trade or my Robinhood account, I have access through a platform where I can connect with different sponsors by investing in them by buying shares. Same concept with what we're doing here. We would have your business securitized such that it could be listed on our platform and you could raise capital from the correct consumer. Now, let's say, for example, you were only offering investment opportunities to accredited investors. There would be a lesser requirement than if you were to decide to offer investment opportunities to the general public, right? Because there are different rules associated with the background of that investor and obviously their net worth and their experience and whether they can get taken advantage of or not. So in our circumstance, What we ensure is that we have the right type of fund in front of us, or the right type of vehicle in front of us, that can approach the right type of investor. So for example, if I have an accredited-only offering, non-accredited investors will not be able to participate in that offering. And the barrier of entry is a verification to ensure that that investor is accredited. We will actually go and collect some documentation from that investor to ensure the accredited nature of that person or that household. In the circumstance of a public offering, you would require a Regulation CF or Regulation A offering. Now, I'm not a lawyer, but we have plenty of lawyers that we work with. So if you ever have questions about this, we can dig a lot deeper. But just like Apple or Google, they have gone through a process of setting up an entity through an S-1 security, for example. Right? They're, they're a big blue-chip stock. They've gone through the SEC. They've gotten certain approvals. They've gotten certain qualifications. They also have certain requirements to do certain auditing, uh, 4 times a year, every quarter, annually. Same concept with our developers that choose to raise capital from average consumers. They will be held to a higher standard. They will need to get qualified through the SEC through one of these lower-tier securities such that they can list these offerings on our platform and we can legally collect capital from those average consumers. So just that process in itself requires time, money, and effort. So we will only go through that process with developers that have a track record of success, that can show us multiple funds that they have already been successful within delivering returns back to accredited investors. that we can justify saying, okay, these guys seem like they've done, done this a few times. They've delivered returns back to their accredited investors already. Now they're ready to go to the public markets. Let's increase their visibility, give them a larger audience to raise capital from so they can lower their cost of capital, increase their profitability, and continue to scale their business. So extremely difficult vetting process that we have with our developers. We don't just take anybody. And then anybody that would like to raise capital from average consumers has a whole different list of requirements associated with the SEC that we just support and walk them through, show them who they need to talk to and how they need to operate. But they will be required and held to that standard of doing annual audits, doing an annual review, quarterly reporting, etc.

So, okay, so it's It's kind of like a syndication on my part. I have to put that together before I come to your platform?

That's correct.

Okay.

That's correct. So if you're familiar with the term Reg D—

I've heard of it, but I have no clue what it is.

Essentially, it's an exemption through the SEC which will allow a sponsor to raise capital into a security, essentially a vehicle, an investment vehicle that's been exempt from the SEC because of certain sets of rules. So for example, if you were to go with Reg D 506— and I'm getting a little bit into the weeds here— uh, you would be able to raise capital from only accredited investors and generally solicit your offering to anybody. Now when you send in that exemption, they essentially will put a stamp on that exemption and say, okay, we see that you're raising capital from accredited investors only, play by the rules or get in trouble. So now it's the responsibility of the sponsor to ensure that the investor on the other side of the table is of an accredited nature, right? So essentially, that is one type of vehicle that you can use. There are many other vehicles that you can use, like for example, an LPGP structure that you guys are probably pretty familiar with, right?

Mm-hmm.

Where you have an LLC, and you have a general partner that manages that LLC.

Yeah.

And some LPs that maybe deliver some capital such that you have equity to go and place into different deals. So, there's many different vehicles that you can use. Each one has its own different methodology around how you can raise capital. And what we want to be is we want to be that listing platform where we can provide a place for those sponsors to list their offering, attract the right investor for that offering type, and then provide an excellent return back to those investors and create a happy relationship between both sides.

Okay, and so do you guys charge a fee? Obviously, um, is it per person, the size of the deal? What, what, what is your fees?

Depends on, uh, depends on the deal. So for example, if you had a Reg D deal that you're focused on doing accredited only and you're interested in marketing that offering to high net worth individuals, We have a marketing platform where you would list on our platform and we would charge you upfront to get on the platform and then a monthly marketing fee. If you were to do a crowdfunding campaign where you would list your offering and we would manage all of the moving parts associated with your raise, like the broker-dealer, like dealing with the transactions, collecting payment, doing subscription documents, that's more of a usage-based, uh, fee structure. So it'd be based off of how many investors you have in a particular investment charged on a monthly basis and how many investment types or more quickly opportunities you have within the platform. So that's more usage-based.

Okay. So mostly the people that you're looking for have got a proven track record. They're doing what they're doing. They just need to expose what they're doing to more people.

Essentially.

Okay.

So it's been really interesting to watch the markets over the last 2 or 3 years. You guys probably have noticed that funding has been rather difficult for real estate sponsors, developers, um, for venture firms that are looking to go place capital. It's been a really interesting market. And what we're seeing is that there's a massive need for more supply.

Mm-hmm.

But funding is a big holdback for a lot of developers. Money is expensive, it's hard to find. Accredited investors and institutions have been a little bit more held back in the last 2 years. And what we've really seen is a waterfall since 2021 of capital being deployed. Just between '22, '23, and now '24, it has just been a waterfall. We saw an absolute high in 2021 of capital being delivered into real estate, closed fund real estate deals, uh, or venture capital deals. And by 2024, we're starting to slowly but surely tick back in the right direction. But it's been about half of what we were doing, uh, in '23. And then '23 was about half of what we were doing in '22, and '22 was about half of what we were doing in '21. So I think right now the name of the game is how do we find money, effective money to go and build supply such that we can help solve this crisis that we have in the United States around housing. So how do we elevate opportunities for those sponsors to reduce their cost of capital and increase the impact that they can make by building more supply in the United States? Well, let's go get them some money. And more than ever, we've had average consumers completely priced out of the market. They can't afford to buy. Nobody can buy right now. Average consumers are having a very difficult time finding their way into the American dream, having a first home for their family. Well, how do we solve both of those problems? Well, let's give the average consumer a way to get their foot in the door in the number one long-term asset. in America's history without the barrier of entry that we've seen up till now, and give that opportunity to the small to medium-sized businesses that have the know-how, the capabilities, the teams to go build that property such that you have a win-win. We have more supply, we have small businesses winning, we have average consumers making money on real estate. Hopefully that rolls into them buying their first property. Everybody wins. So we're just looking at the market and saying, okay, well, as consumers, we're getting priced out. How do we find a foot in the door? Here we go. As businesses, we're struggling to find the right cash for the right deals at the right price. Well, here you go. Let's pair the two, go have a beautiful marriage and find a way to make it work. So that's where we're at.

Yeah, I know you talked about possibly Doing a fund or something for the flips? I did one time. Yeah, yeah, yeah.

You don't remember that?

Did you actually listen to me?

I listened to you.

Yeah. Wow, so that's nice.

Maybe it's time to do it.

I've always found out it's like, um, very difficult to do syndications. It's not easy. Stuff like that, you know. It's— you got tax implications, you've got reporting requirements, you've got so many moving parts that at the end of the day You know, your return on your investment goes down because you have to do all that compliance stuff. Do you see any, um, anything in the near future that they're going to reduce the compliance? Or— I mean, it's there to protect the normal investor that is not accredited. I understand that, but there's a lot of hurdles to jump.

There's no doubt. What I will say is this, we have enough technology to overcome some of these hurdles, right? Processing data and dealing with compliance is just a set of rules, right? We have ways to manage rules. The problem is that it's really difficult to understand what rules to follow and what rules are more important or less important to follow. And nothing is black and white.

Mm-hmm.

So I think it's all about getting the right people in the room so that you have the right direction on where to go. And that was something that we tried to do really early, was figure out what are the obstacles, what are the difficulties, what are all the pieces that come into play? And, and we tried to build a network of people around us that could give us great advice— lawyers, accountants, auditors, firms, individuals. Anybody we can get our hands on that had some knowledge or experience in this space, dealing with syndications, dealing with securities, dealing with all these moving parts. And I think what really needs to be done is, is there needs to be a group that's willing to come and put all these resources together and create a process that's simple. Because at the end of the day, real estate developers are real estate developers. They're not capital markets experts. Their job isn't to be a securities attorney. Their job is to go build real estate that turns a profit.

Mm-hmm.

So for us, it's been really important to build some of that infrastructure so that we could provide a white glove experience for those developers because of the level of complexity. Now, I can't go to the SEC and tell them to change things. That's not going to happen. Maybe, maybe one day we'll get to a place where we have enough scale to go turn the tides in Washington, but we're not there just yet. So what we can do is we can do our homework, and we can do our absolute best to have all the right providers, vendors, experts behind us so that we can create the most seamless process. Because it's possible. It's possible. Right? If it's possible, it can be redone. It can be done again.

Mhmm.

It can be done more efficiently. It can be done easier. You know, some people love this example. Some people don't. Grant Cardone. Has built an entire business around raising capital from the public. Now, however you feel about Grant, that's totally understandable, right? And at the same token, he has raised one and a half billion dollars for five or six billion dollars worth of real estate and is constantly sending out checks to his investors every month, every quarter. Why can't that be? Joe doing flips? Why can't that be GLH doing affordable housing? I don't see any reason why not. I think the conversation is how do we make it accessible for someone that maybe doesn't have an audience of 10 million people to talk to, or someone that doesn't have, uh, an army of lawyers to build the right stuff? Let's get all that stuff in one place. Let's use technology to do it.

Well, we are the number 1 podcast in Laguna Hills.

That's right. It's not nothing.

It's not bad.

It's not nothing.

That's getting there.

Yeah.

Army of Lawyers, I do like.

I don't like it.

Well, only because we had a meetup guest who came by, and he told us his story. He started a fund—

Oh, yeah.

—during 2008. He was scaling. He admitted he scaled a little too fast. The market goes boom. All he wanted to do was take— some funds from this project to help this one so everyone can kind of win. Well, he gets hit with wire fraud charges. He's got the black vans rolling up, taking him out of his house, all of his neighbors watching and everything.

So, and he went to jail.

And he went to jail for 10 years.

Well, and I'll tell you, he's a little— and this is the thing that hurts, and this speaks back to your conversation around compliance is When you look at the government entities that are managing finance as a whole, I think the intentions are set up opposite, right? How does— because let's think about it. The SEC is a private entity. It's a business. It's a government-sponsored business, but a business nonetheless. A business has to make revenue. How does that business make revenue? Well, that business makes revenue off of charging fines and fees to businesses that mess up. So inherently, wouldn't it make sense for them to make the code more difficult such that more people would screw it up such that they could go chase more money? So inherently, the entire system is flawed, which makes it really difficult for a good sponsor that wants to turn a profit for their investors to be able to operate, me included. I'm currently raising venture capital. I would love to be able to write a check to somebody for a percentage of however much they raised for me. I can't do that. That's illegal. That's the selling of securities. I would get in lots and lots of trouble if I did that, so I can't. Ties my hands. But if I had someone who was capable of connecting me with the right investors and I could properly compensate them for connecting that highly qualified investor with my venture capital deal, I would be more than happy to write them a check for the percentage. But most people don't know that that's a rule. So people will go pay those percentages, and then what ends up happening is the SEC will come back and say, "Oh, you messed up in this 2004 at three o'clock in the afternoon," and da da da da da. So I think inherently there there needs to be a little bit of a shift in mentality, and I think that's coming with the new administration, which is exciting. I think it's gonna be really interesting to see what happens with this new administration. There's already some rumblings in the SEC of what's happening. And I think it needs to happen not only because of what we're doing, right? We're— there's lots of us going and building opportunities for real estate. But as a whole, if you look at crypto, you look at DeFi, you look at literally anything in finance right now, the regulators are 100 years behind the operators. And that's the problem. That's really the issue. It's not even about they don't know, they don't know this, they don't know that. They're just not up to speed, because it's almost, it's almost impossible to be up to speed. I try to keep up with what's happening in finance, and it's, it's just moving at light speed. So to expect the regulators to keep up is a very difficult task. And as the most powerful country in the world, America, let's go, uh, our country being on the forefront of finance and, and our retail credit, retail investor being the most coveted investor in the world, we do need to make sure that we're in the same playing field as the rest of the world. And we have the same advantages to be able to invest our capital and turn a profit as a nation, as all of the Emiratis do, or anybody else around the world that has maybe less regulated security systems that allow people to freely move money. Such that businesses can turn a profit and create jobs and create tax money and all that sort of good stuff. So I think, I think there's good things coming. And I think that there's technology to overcome this. I think, I think no matter which way we turn it, whether we get this beautiful, amazing new world that we're hoping for in finance or not, we have the technology to be able to deal with it.

Yeah, I think technology is going to solve a lot of the issues. It's, um, but you know, then, then it's like a cat and mouse game where they come up with more regulations to like stuff to trip you up. Absolutely. Yeah. Hey, that's kind of— that's always been like that. So, but you know, people will figure a way around it and that's kind of like the tax system, right?

Yeah. Rich people have attorneys. Poor people don't pay taxes, so it's the middle class that ends up with the squeeze having to pay. Yeah, yeah, yeah.

I mean, I mean, but then it's kind of on you. You, like you mentioned, these are just rules. So if you know how the game is played, then you can go ahead and, you know, put your chips in and make a little moolah.

That's the game. Whether it all plays out exactly the way that we say it does, right? 2 very different things.

Very true.

But, uh, but yeah, you know, look, I think finance is going to be a wonderful place to be over the next 10 years. I think real estate's gonna be a wonderful place to be, but there's so much opportunity for disruption with PropTech. And, uh, I think it's just now starting to get its footing. It's been really difficult to, to disrupt real estate because it's the devil that you know, right? It's like you play the game that you know.

Yeah.

So now slowly but surely, I think people are starting to come around in the real estate space to new data solutions, new financing solutions, new— right, you know, how do we expand the business?

Yeah, exactly. I mean, like, if it keeps going the way that you're saying, um, especially with something like your company, it's just gonna be— I guess you'll have like a wallet or something and you're like, oh, these are all my investments right here. I got like some money in here, some money in here, some money in here. It's all diversified.

So, and I think if we continue to push into the small to medium business space and start to help some of these American businesses, I think there's also a great opportunity to work with some of the, um, strategic partners. So for example, we have recently connected with a group that has technology that allows real estate developers and owners to manage the appliances in their Units better. So, for example, let's say you had a thousand units and you had a dryer and washer in every single unit, and you need to maintain that dryer and washer. And then you had a bunch of other appliances within each unit: microwaves, refrigerators, whatever it might be. This software will actually ingest all of that data on every one of those products and then provide live updates on which. Products need to be refurbished or maintained or have warranties coming up such that you can more effectively strategize how you spend your money within your real estate property such that you can create the best ROI for your investors. How do you do that? Reducing the number of trips that you have back and forth, reducing shipping costs by ordering multiple things at the same time, you know, fixing, you know, multiple problems at once that maybe you can anticipate because you know that the warranty on this item comes up in a month. So you might as well replace it now cuz you're already making a trip out to that property and you're already sending out all the workers to go do the work. Let's just do it all at once. Right? So leveraging data, leveraging tech, leveraging just new solutions in the marketplace, I think is something that's on the forefront of developers' and sponsors' minds.

Mm-hmm.

As they continue to grow and scale. And I think if we can start to really inject those different technologies into our developers' line of sight, I think that they're going to start to really see efficiencies within their businesses, which at the end of the day turn a better profit for everybody. So I'm excited about that.

Yeah, that's, that's interesting.

It is very interesting. Hmm.

Yeah. I mean, do you see it working with just like a single flip? Or I mean, can, can, does it have to be that?

Just one example, right? I think I, you know, at this point in the last year or so, we've been mingling with as many technology companies as we can in this space, because we obviously have mutual customers, right? Our customers are real estate developers, just like the data companies are. And We've slowly started to realize that the sponsors and developers are eager to find efficiency because it is an older business that has been stagnant for a while and is ready for some updates. And they wanna be on the forefront. They wanna have that advantage now. So we've just kind of started placing different opportunities and they've been fruitful. That is one of a few different data solutions that we've been able to put in front of different developers. One very interesting predictive data solution that allowed for a developer to be able to predict the litigation of a certain family matter that could end up with a house being on the market 2 years from now, and they could have early access to that house because they know that, you know, one brother is unhappy with another brother, and they can come in as the white knight and provide some money to provide relief to the situation because that trust needs to be split up, for example. So Really creative things are happening right now in real estate, where you're looking, you're looking at opportunities to create funnels of data, and then produce really high-quality byproduct from that data. And I think the more that we have creative minds working to try to think about different problems within the industry, the more we're going to have developers taking on new technology that they can implement to increase the efficiencies of these different real estate products. And, and I think if we can get some of that retail capital in there and inject maybe a more affordable cost of capital into that developer's pocket while still providing a great return for those average Joes, I, I think that there's so many ways for us to create exponential improvements in a game that would, that has been thought to be a little bit stagnant, right? For a long time. It's like, okay, well what's, What's the situation? What's the cap rate? What's the NOI? How do we take this to the next level? How do we take that cap rate conversation completely out of the conversation? How do we focus on operational efficiency? How do we focus on creating the most amount of value for tenants such that instead of us focusing on, okay, well, I can pinch out an extra quarter point if I do— let's try to find ways where we can really maximize. I think technology will do that. I think technology will do that. I think democratization will do that. I think decentralized finance will do that. So I'm excited. I'm really excited for what's coming.

It's going to be an incredible year. Are you ready, Joe?

I'm ready.

He's been waiting for a long time.

Yes. I've been waiting for the last 4 years. It's almost like my Cybertruck. Yeah. It took me that long to get it too.

It's finally here, baby.

Finally here.

Come on. Let's go. Yeah, that's really great, man. You're getting me pumped on this. So I see now why you're the face of the company.

Well, thank you. I really appreciate that. And I do want to give a shout out to my guys because without them, I couldn't do this. I have 2 incredible technical co-founders, one, Ross Signorelli, who's my right-hand COO and president. And he's been with me for the last 8 years working on every project we've done. And I couldn't do what I do without him. And then our new kind of third amigo is Abdul Zahid, who's our CTO, ex-Rackspace, Raytheon guy, incredibly smart. And literally, I haven't heard the word no come out of his mouth. So I'm really grateful to both of those guys for sticking through the process with us.

That's excellent.

Yeah, man.

Okay.

It takes a team. Nothing's done by—

Yeah, absolutely.

You can't do anything by yourself.

Yeah, yeah, yeah, yeah, totally. Um, so yeah, this is a part of the show. I, I, I have some videos, um, I'm gonna bring up and I kind of wanna get your reaction on these. Cool. So, Lauren.

Alrighty. The first one is more real estate predictions. Here we go.

The whole thing with Medicare, Medicaid, Social Security is the younger generation keeps having to pay for it. They're going to go bankrupt. The older generation, the traditionalists, the baby boomers are sitting there saying, oh, we got to get the benefits. But why isn't anybody wanting to change the benefits of Medicare, Medicaid, Social Security? Ain't nobody gonna get reelected. Nobody gonna get reelected.

Correct.

What does this have to do with interest rates? Same exact thing. The right thing for us to do right now is to keep the rates high for a long time, have a small little market correction happen, but that's not gonna get anybody to get reelected. We have to print more money and put it in the bank, and we have to print more money to put in the economy. And people are sitting there saying, forget about what Powell is doing. So my thoughts on what's gonna happen with real estate, Real estate is we may see a small little adjustment here and there in different, you know, pockets of America. I don't necessarily see a big crash coming with real estate anytime soon. The whole thing with Medicare, Medicaid—

Boom. Thoughts?

Well, first of all, he said something very interesting, which is if we were smart, we wouldn't be reducing the rates just so fast.

Um, and obviously all of us really would love for the rates to go down.

But at the same token, we're seeing unprecedented times. Market's in a place where it's never been before. We're pushing into new heights. Um, be greedy when others are fearful and be fearful when others are greedy, right? And, and right now others are starting to get a little greedy and I'm starting to get a little fearful.

Uh, yeah.

But at the same token, I am very excited for what's to happen in the next couple years with the new sentiment around the market and the way that people are feeling about the power of the US market post the election, we could really see some really cool stuff happen that we've never seen ever, ever before. So I don't know, I'm hesitant to make a particular prediction. What I personally was saying up until maybe actually this moment, funny enough, was that we really probably shouldn't be reducing the rates for probably another 6 to 8 months. I don't think these correct— I think, I think we should probably throw the, the brakes on a little bit.

Right.

But that's how I feel about the situation. How do you guys feel about it?

Joe says 5%. By when?

The end of next year.

Okay. End of next year.

Yes.

I mean, we're still getting offers, um, on our properties. People are, you know, I think as long as you buy right, You know, that's just, that's a tried and, uh, you know, a tried and true rule. Um, if you buy right and you price it right on the other end, you're gonna have buyers. The rates aren't really gonna be that big of a difference.

They figure them out.

Yeah.

So like this one deal we're doing now, they're asking us to buy down the rate, you know.

So yeah.

Yeah, it were— people find ways to do things when they want something.

I agree with that.

Yeah, right.

Well, and the thing, I mean, you, you mentioned this all the time, the rates come down, prices are going to go up. So now where does that leave us? I don't know. I don't know if that solves anything at this point. Yeah.

So, well, we get, get the rates down to 5% where people feel comfortable that, you know, I'm gonna go buy something. And hopefully they do. But yeah, it goes back up.

So might as well buy now. Yeah, hold on to it.

Buy now. The trend is up. If you can find a way to make it happen, go buy something.

Okay, let me see if I can figure this out.

We have another video. Yeah, yeah, yeah.

We're trying to fix the sound real quick.

All right, try it again.

All right, let's give it a shot. Next video is, is renting better than buying right now? Let's take a look.

I've bought a condo. I own 1, 2, 3, 4, 5, 6, 7, 7 or 8 properties right now. The rental market is 10 times better across the United States Than any buyer's market. How are you purchasing a condo?

The broker that I spoke to, they was like, yeah, we can make it happen.

Getting a wage is like you're paying yourself rent.

If you can afford it.

According to somebody, I can afford it though.

If they say that, they're legitimately dumb. What they're trying to get is their little precious commission. I'm not getting paid by telling you this.

I guess it's 'cause like they helped my cousin buy, so I was like, oh, my cousin's place is pretty nice. So I was like, I can just put it on a credit card and pay it off.

If you even said that statement, buying a piece of real estate is not in the picture.

Well, it's gonna happen.

I've bought a condo. I own 1, 2, 3, 4, 5, 6, 7, 7 or 8 properties right now. The rental market is 10 times better across the United States than any buyer's market.

I was gonna laugh.

This guy's pretty good because he just roasts people that are like—

He's great, actually. He's wonderful because, you know, I think people need to get slapped, right? Sometimes people just need to get slapped with some sort of reality of like, hey dude, you either need to spend less or you need to make more. You got 2 options. Yeah, you got— right, right.

If I—

I think it's all about mindset, right? If you, if you have a place that you want to go and invest in outside of real estate, because it's more approachable, because the cost of getting into real estate is so expensive, then I see the value in being a renter in this market. At the same token, Actually, which is why I'm building what I'm building, right? This is the entire reason why I'm here. And I'm trying to give a good answer that if we didn't have Rally today, right, what would you do? I really think the name of the game is stack your chips and purchase a piece of property when you can actually have some leverage in it. Because at the end of the day, a massive payment is not going to help you in any way, shape, or form. You're just going to go bankrupt. You might as well have the rent, put some money in your bank account, get a little bit more frugal, save some more money, spend a little less, and go put a nice down payment on a piece of property. So you actually have— in that way, worst comes to worst, you need to go rent the property out, at least you maybe got a little bit of cash flow there. You got something going on. But having a massive mortgage payment has never been something that I have ever been excited about or would recommend to anybody.

Yeah. Yeah. I mean, especially if you're in that situation where you gotta put some of it on a credit card, you know, and you're like, don't ever put anything down. 30%. You're like, yeah. You're like, I don't know if that's really solving a problem, but, uh, that's creating a much bigger problem.

That's what that is. That 30% interest.

Yeah. Well, it's, it's kind of interesting. I mean, especially around here, um, you know, we're renting in Dana Point, the place that we're at. If we were to buy it, yeah, our mortgage would be insane.

And it'd be at least double, maybe triple.

Yeah. Yeah. So we're banking on seller finance. It's a good way to go. So yeah.

I just talked to a developer about a deal that he did seller finance. They're very, very stoked on that deal.

Yeah, yeah, yeah. No, that kind of solves a lot of the problems as well, but so does Reli, you know what I mean? So then you could start investing in real estate without having to have the massive, Down payment.

Go get some of that cash flow in your pocket so you can have down payment to go buy that real house.

There you go. Absolutely. Boom. What else we got?

We got one more. Dan Pina predicts 2025 crash in commercial real estate. Okay.

I might have seen this one actually.

I said the big tsunami's coming. What's the big tsunami? The collapse of commercial real estate.

You think it's going to drop?

It has already dropped.

London's down 40% in some areas.

Correct. Now, if you knew that 22 of the last 23 quarters, Mayfair real estate has gone down in value, and you find it on page 42 of the Financial Times, down in the right-hand corner.

Is that because it's bad for the bank?

Absolutely. The largest building in St. Louis, 68 stories, 100% empty, sold for $3.4 million. Am I the only guy that looks at this?

A great time to buy for people like me.

Correct. I said the big tsunami's coming. We'll The collapse of commercial real estate. It has already dropped.

Sitting in his mansion just making predictions.

Look, yeah, you guys would all know much better than I am as I'm very new in this game, but what I'll say is this: I see the big corporations starting to hedge to go buy real estate. And now's the time. Look, if, if you had a bunch of money in on your, you know, in, in this year in income and you had a big old tax bill to pay as a big corporation, what the hell would you do?

Right.

Put your money into some commercial real estate that's on its butt. That's what you'd absolutely do.

Is that what I said?

That's what you said as part of the prediction.

I think actually I closed in one of my investors. I closed him, I think, with that because I had that opinion. I was like, dude, how, how are we not seeing this? How are we not seeing that the big corporations with all this money that's laying around, they have a big tax bill coming and there is just so much to buy for pennies on the dollar. These developers that have been holding, or these owner-operators have been holding on to this commercial real estate for the last 30 or 40 years and their cost basis is 20% of what the value— the value of what the property is supposed to be today, right? The speculative value. They're willing to take a haircut on that deal so they can walk away clean. And guess who's going to go buy all that property? The big corporations are coming in to go swing their big money bags. Absolutely. If I was— if I was them, that's what I would do. Yeah, that's a big tax break.

Oh, yeah. Absolutely.

I agree entirely. Okay, they're gonna buy your Dana Point property.

They should be buying BlackRock and rent it right back to you and then rent it right back to you at a premium.

BlackRock's the devil. Yeah, well, they're playing with the house's money too.

That's, uh, that's part of it. That's why Reli is trying to get all the average Joe money.

Exactly. Yeah, give it back to the small business owner. Yeah, that's why we're here. Yeah, I mean, we don't need that many properties to Be, be living fat. So BlackRock can buy up—

Staring into my soul when you said that.

Yeah. Um, but yeah, I mean, especially the commercial, like you said, you've got all these, you know, retail office buildings. I don't know what we're gonna— people are already starting to convert those to apartments, so there's going to be a lot of development going on with those. Be interesting to see.

I think the newest trend that's going to start coming is micro But it's going to be not necessarily in the boxable, like boxy home that you see. I think we're going to start to see 2-bedroom, 1-bathrooms popped up with smaller square footage and start seeing them in little communities. Like those little townhomes that you have that normally were 3 or 4 bedrooms with 2 or 3, 2.5 baths, start seeing those at 2, 2-1.

Right.

You start seeing those tiny little starter homes for half a million, a quarter million in California, right? Something like that. Or if you start going a little deeper into the United States, those numbers are going to start to dwindle significantly. But I think the newer generations really want something of their own. They don't necessarily want to live in a cube, right, within a big multifamily. So I think anybody that can create a community around maybe some micro homes, maybe build some, you know, build the neighborhood Starbucks and the neighborhood Target, right, all that stuff, and have like a little community for remote work.

Huge opportunity. I've had a micro home for 45 years. The only problem is my children were in there and they weren't paying rent.

Yeah. What's yours as a micro, Joe?

Didn't work out very well.

Yeah. Yeah. I don't think that yours would be considered micro, but—

It's split up into little micro rooms.

Oh, I see what you're saying. Yeah.

It's become micro.

It was rented by the—

Everybody else's rent.

It was rented by the I'd knock on the door every month, but I didn't get anything paid back.

For some reason, there's never money waiting for me.

No, never. Never.

It's a crime shame. Um, how can people start working with you if they're either an investor and they have an opportunity, or, you know, they want to just be on the platform?

Yeah, come check us out at relli.co. R-E-L-L-I dot C-O. You can get a hold of us through there as an investor by building a an account, um, you know, create an account, create a profile, all that sort of good stuff. Um, we will absolutely be reaching out to you, say hello, see how you're doing, see what interests you guys have so we can make sure to line up right deals. And then if you're a developer, a sponsor, you want to go and raise capital on the platform, uh, you can reach out to me. Find me on LinkedIn, Mor, M-O-R, last name Milo, M-I-L-O. Uh, you can also reach out to me directly via email at mor@ @relli.co, R-E-L-L-I dot C-O. Happy to talk to any developer that has a track record of success and looking to raise some capital. I'd love to put them on the platform. And then for anybody who's like a strategic partner, accountants, auditors, brokers, mortgage people, real estate people of any kind, we are looking to try to spotlight these professionals as much as we can so that we can start building that community. So Same thing, reach out at more@reli.co and we'll have a chat and see if we can put you in our strategic partner portal.

Awesome. Well, thank you so much for breaking all this down. It's very exciting stuff. Future of real estate right here. And yeah, if you guys enjoyed it, let, let More know, reach out to him. And if you want more information, then hit him up. You know, let's, let's get this baby rocking.

Yeah. Thank you. Thank you guys.

Appreciate the invite. Absolutely. Yeah, we'll be back here in 2 weeks. Joe's going to be up in the mountains next week. Next week? Where you going?

Big Bear. Nice. Yeah, just came back from Mammoth.

It was wonderful. Yeah, I like to stay local. There you go.

That should be fun. Yeah, hopefully you get some time off. We'll see.

Well, it's— I take my laptop.

I know he's not. He's going to be working.

Uh, I'm just going to be in the mountains. That's right. Different location. You'll be here.

So we will see you on the following week after that. And then hopefully by then we'll have a meetup guest and we'll let you know about it. But thank you guys for joining us and we'll see you soon.

Bye. If you want some more advice on real estate investing, reach out to us one-on-one.