In this episode of Multifamily Strategy, Christian Osgood walks through the full lifecycle of the Robin Hood Village Resort acquisition, focusing on the challenges and lessons of a seller‑financed hospitality deal. He explains the original financing – a 4.5% interest, 8‑year seller note with a large year‑end principal pay‑down – and how the partnership structure (20% equity each for Osgood and Cody Davis) left them repeatedly covering shortfalls when the resort under‑performed. To resolve the situation, Osgood and his team refinanced, sold a multifamily asset, and used roughly $1.45 million of personal and cash‑out funds to buy out the other investors, even delivering a 9% return to a partner who was owed nothing. After gaining full control, they invested in operational upgrades: permanent hot tubs, an all‑season wedding tent, and a $32,000, 16,000‑bulb flower planting project designed to boost shoulder‑season appeal. A modest $1,000/month marketing budget, expanded distribution (Expedia, Booking.com, Airbnb), and a weekly concert series drove a 43% revenue increase, moving annual top‑line from $575‑$600 k toward $800 k. Osgood projects that, with continued optimization, the resort will generate six‑figure cash flow within two years and build roughly $3 million of equity. He concludes by announcing an on‑site 2‑3‑day intensive workshop where participants will experience live deal sourcing, negotiation, and closing at the resort, tying the operational turnaround back to broader lessons for creative, seller‑financed real‑estate investors.
Chapters
Hello and welcome back to Multifamily Strategy. Talking Robinhood today, which I am super excited about. We're giving a little bit more insight on the story, where we are at, and some lessons that I think you can take home if you are doing the whole seller-financed thing. Uh, this is where seller financing come to bite you. The online gurus don't like to talk about the fact that, uh, when you get creative, you get what you negotiate, and what you negotiate isn't always exactly what you think you want. So I'm going to go into that story and more importantly, some of the things that are making it work. If you've ever thought about hospitality, you've ever thought about short-term rentals, uh, while it's not my core business model, we are making it work and I'm really excited to share this. So first of all, what happened originally? So in my first year, end of the first year of buying significant multifamily, I went from 0 to 81 rental properties in year number 1. This gave both me and Cody Davis a, uh, idea that we were really good at this creative real estate thing. Um, turns out buying entry-level multifamily on deals that work and making money on them does not mean that you're automatically good at running hospitality. So this is a pretty significant, uh, problem for us as we raised money for this. Was our first million-dollar raise. We get into this project and turns out we need way more marketing budget and we need way more rental budget. We did not realize how much work this was. Uh, problem part number 1, partner number 2 did not want to come up with any more money. Now, in our original structure, I owned 20%, Cody owned 20% of the Robinhood. I don't want to put 100% of the money up when I have 20% of the equity, especially when the Robinhood was overperforming. So for 3 years, we got stuck in this underperforming asset. Uh, the Robinhood was not making the money it was supposed to. We'd get less and less bookings every single year. And because of that, there's no new money hitting the account that allows us to renovate the resort. In fact, here's how we structured our deal: 4% interest, which is an awesome debt product— 4.5% actually, to be exact— 8-year seller finance note. So we nailed the terms. Uh, problem: we have a principal pay down at the end of the busy season. So in the offseason, we don't have the negative cash flow— at least we weren't planning on it. Uh, but in the end of the summer season, we get to October, and November 1st we pay down about a quarter million dollars for Robinhood. $225,000 gets paid down on the original loan. That's the design that we did. So it is a principal plus interest with all the principal paydown due at the end of the year. And it pays down or pays off one note at a time, goes through each of the notes. Notes are complete and the Robinhood works that way. So a problem when it wasn't making enough money at the end of the year, we would have to come up with more money, which Kate, which Cody and I specifically guaranteed. So Cody and I were writing checks, and usually at the end of the year we'd be about $80,000 shy or so. So we would have to come up with, out of earned income, $80,000 every single year. That just gets thrown at the principal of the loan, of which, remember, I owned 20% and Cody owned 20%. So most of that money was just magically lost. Now fast forward to the end of this. We actually did not have an obligation. Now everyone, all of the investors were partners. We did not have an obligation to buy them out. However, Uh, when you have a deal that does not go to plan, uh, you see a lot of investors go like, well, on paper everyone knew they could take a loss. Um, Danny and I decided to do what we felt was the right thing, which was, uh, look at our portfolio, do some cash-out refinances, sell one building, and write a check to buy out the partners of that deal. And so we backed out the tune of about $1.5 million I think it was just shy of that, like $1,450,000 of pretty much all of the cash and some that I had earned through my multifamily career in those first few years. We bought out the investors. We said, hey, look, this is underperforming. We're going to take all of the risk. We're going to make everyone whole. In fact, one of the investors, the main funder of the deal, he was expecting to get about an 18% return on investment annualized. Uh, we gave him a 9% return on investment on a deal that was losing money where he was owed actually nothing. He was just a partner. Um, I call that doing the right thing. So they came in on a 3-year note, um, he put in $700,000, he's got paid out like $1.1 million. Um, so we made right, uh, not just right, we actually made sure that there was, uh, actual gains to members of that particular transaction, which was Uh, really difficult to do and really uncomfortable. So that is the downside. Let's talk about the good stuff. With the partners bought out and all that money gone, we put more money into the Robin Hood and the Robin Hood Village Resort. Uh, now let's see what we do. We replaced the, uh, we had nice inflatable hot tubs. They're actually great, like $700 hot tubs. Uh, we're replacing them one by one with permanent, really nice hot tubs, you know, the jets that fits more people. Uh, we've done 3 of them so far. Gosh, reviews love them. So the next 3 are getting installed now. The wedding tent was falling apart. We got a brand new one and it's all-season. So instead of having a skeleton of a tent throughout your off-season, we actually have a full-on workable outdoor venue, uh, and it has closable sides, which means you can actually, uh, run some heating. You can have this heated big outdoor event area. I don't think it's going to be used a ton in the off-season, but it's going to look a heck of a lot nicer, and it is actually usable for outdoor events all year round, which I'm really excited about. It looks beautiful. In fall, we have my favorite project. $32,000 of flowers are going to be planted around the Robin Hood. Here's the math on this, and I'm really excited. If you guys are in the hospitality business, you want to be in the hospitality business, you've looked at short-term rentals, uh, this is the magic, and I'm really excited for how this is going down. So we're planting roughly 16,000 flowers. Now there's some azaleas and some bigger bushes that are going in, but most of it is going to be deer-resistant bulbs. So we're talking daffodils, we're talking hyacinths, we're talking, uh, hellebores. And I won't bore you with like all 6 of the bulbs that we're doing, but they're gonna be multiple colors spread out in a really organized way all throughout the resort. Why is this so important? First of all, all of these plants, while deer-resistant, also multiply year over year. So planting 16,000 of these, if you take that out 5 years, it should be about 250 1,000 flowers. Now, assume we lose some to squirrels here and there, but for the most part, we should be able to protect them. There's already daffodils that keep proliferating at the Robin Hood, so I know a lot of these actually do what they're supposed to do. Uh, what does this do for a resort though? We chose a selection of flowers that bloom in massive waves in different colors over a 90-day cycle. This 90-day cycle happens to exactly overlap with a season that is called the shoulders. So I'll give you some real numbers. Uh, the Robinhood in the offseason, in a good month, does about $35,000 top line revenue, and it costs about $40,000 to run the offseason. So we run at a slight loss in the offseason. In the summer, a good month for us historically is $110,000 to $115,000 in our peak months. The shoulders, we sit right around $45,000, so slight, slight profit. And those are the 2 months leading into the summer and the 2 months leading out of the summer, peak being July and August with a pretty decent June month. That's what the books look like. That's what you're looking for over on the Robinhood. Your typical year for the Robinhood, you're gonna be around $575,000 to $600,000, which is not enough for what we paid for it. It gets a lot better though. Since we opened a small marketing budget of $1,000 a month, we get a 400% return on that, which helps. That just boosts the Robin Hood a little bit. Uh, we've had the concert series that now runs weekly at the Robin Hood and the big summer concerts. So becoming a music venue has also pushed the total amount stayed, the price of the stays, uh, the upgrades to the Robin Hood has increased the reviews, which has increased the traffic. And we got it on everything. We got it on Expedia finally. We got it on, you know, you can find us on all of the sites now— Expedia, Booking.com, Airbnb. Um, so we got more channels. The combination of all these has resulted in a 43% increase in the Robinhood revenue. And right now projections are holding that we should move from making about $575 per year to a little north of $800 in this year. This is with my marketing plan, investing the right money into the Robinhood. The flowers Such a simple project, but what this does is allows us to use that marketing budget to draw people in in the shoulder months, the months where people aren't quite out there yet, to have the attraction be, hey, this is super unique, we're also a wedding venue. So now you come out and you're like, hey, if you really want to have an amazing wedding, we're going to have 250,000 flowers in this beautiful forest retreat, and it's all yours. All 13 acres is bookable for you and your guests on a multi-day stay. You you guys can just go out here for 2 days. We should be able to get a lot more large long-term bookings. That means less total turns, way more occupancy. My ultimate goal is that we market this well enough so that our April, May, June is almost equivalent to our summer months, the big July and August. If we can hit all of those, we do a lot better. And then we've just been better tracking email campaigns and marketing. But what we found is in a resort that has been, uh, you know, run to the best of our ability, but without a budget. A little bit of money and a little bit of investment in a large project, it's going to make about an extra quarter million dollars this year, which when you own a resort by yourself, an extra $250,000 that you did not make in prior years is a really good trend. What else does this allow? Well, this increases the bankability, this increases the debt products that are actually available to us. We still have 5 years left in our note. But we're actually able to have the resort start paying for the resort and improving the resort and paying down its debt. So while I have yet to be paid from the Robinhood, and I have put, uh, you know, about $1.7 million, I think, total, if you include the contributions and the, uh, partnership buyouts, I put about $1.7 million into this project with no personal return yet. Uh, we're going to end up in a place where we have about $3 million of equity in the Robinhood, and it's going to cash flow Uh, we'll project about 2 years from now, uh, 6 figures, hopefully multiple 6 figures. So was this a smart idea? Absolutely not. Were we able to navigate it? Uh, yes. And the stuff that we're doing, it's the blocking and tackling. How do you make the place feel cooler? Run events, bring music back, plant flowers. We're doing a big event around the salmon run. We have a river that runs literally through the middle of the resort. Um, we have huge salmon runs in October. We have a marketing campaign set up to bring in a bunch of people to appreciate that. The last shoulder month is October. You can come out. It's like, do you think about going to the Hood Canal in the mountains in rainy October in Seattle? Usually no. Do you think about it if you have a giant, awesome, very unique salmon run, a bunch of covered areas, fire pits? Yeah, you might get out there. Hot tubs— as it starts to get cooler, the hot tubs are actually in higher demand. So it's pushing those shoulder months. It's coming up with a strategy, but you can do this in multifamily too. Think of how you can optimize each piece of the property. So your mission is always this: first you buy, then you stabilize, then you optimize. It's always that cycle. So stability for us was staffing first. It was the blocking and tackling. Let's get the marketing going. Let's fix the problems with the cabins. Let's respond to our most common complaints. Those were pretty easy to figure out. The next step is the optimize, and that's where you go to like, okay, now that we're doing what we can with what we have, what is our highest return on investment items? Which in our case, wedding tent. Let's upgrade that thing. Let's make it super nice because events are driving a ton of revenue. Let's make the events cooler. How do we make this desirable in the off-season? What's going on in the off-season? Well, there's a whole lot of nothing in the beginning of the year, so no one comes out to the Robin Hood. How would we attract people in a forested retreat? And that's what we came up with. Comes down to flowers, a wedding tent, and some hot tubs, and it's going to feel unbelievably more modern and better with the little teeny tweaks. Is it free? No. $32,000 of flowers is a boatload of flowers, uh, and I'm gonna plant them myself. And, uh, when I'm out there in fall, um, I'll invite everyone who wants to come and help because, uh, God knows I can use some help. I'll be out there in the little excavator we bought, uh, tilling up the soil and drop some bulbs in. Uh, it's gonna be a fun weekend. But that's what's going on with the Robin Hood. Uh, also a little preview announcement: last day of July, first day of August, we're gonna run an event. Uh, when I have a link, which I should have available here in the next few days— so if you're watching the recap, it may or may not be below in the, uh, job— but we're running an event I've never done before, an actual 3-day workshop where we're going to go from beginning to end. I— people love the Multifamily Strategy Mentorship. We have a lot of awesome, very successful students in it, but we've never offered a crash course for those who are like, hey, I can't, I can't commit 6 months right now to going full cycle and buying a deal, or that's just not what I want. I want an intensive. I want to connect with other people. I'm actually inviting people out to the Robin Hood. You can stay on site, or there's a few resorts next door. We're gonna be— have about 100 to 120 people So, uh, I can't quite house all of you at the Robin Hood, but the resorts nearby are open and available. Um, but either stay at the Robin Hood or stay next door, be on site. I'm going to have musicians playing. You're going to get experience the concerts, you're going to get experience the food trucks, you're going to get experience the entire Robin Hood event experience, as well as go from beginning to end. We are going to do deals live. Like, people are going to come to this and leave under contract for deals. I'm going to show you guys how to find deals. We will go live, call brokers, find deals, negotiate. I'm going to show you the math. I'm going to give you guys a ton of tools that you can use to do this, but we're actually going to go step by step in practice, in person. We're going to find, negotiate, close deals on site, uh, for that event. If you want to participate that, you want to see how to do this all the way through, full cycle, from find, analyze, negotiate close, and manage in a 2-day intensive. I have some awesome guest speakers. I'll speak a bunch more about this, um, but y'all are invited to that officially. Um, as soon as I have the link for that, we'll drop that. But you guys will be hearing a lot more about this as we move forward. As always, appreciate you all a ton, and I will see you all on the next episode.
