Real Estate Revealed

#14 - Ricky Beliveau, Stick and Bricks and Money of Real Estate

Eric Wilson
February 5, 2021


real estate,investors, buy, investment, invest, assets, debt, money, deals, talking,people, rick, capital, market, property, leverage, point, boston, financial,units


Intro VoiceOver, Rick Beliveau, Dave Seymour


Dave Seymour 00:00

Have you ever wanted to create cash flow outside of your job income or retirement plan?Have you considered large commercial real estate assets? Do you know aboutalternative investment strategies? Keep listening. This is real estate revealedhosted by Dave Seymour, the star of a nice living Boston and CEO of freedomventure investments in Denver. Get the real deal about investing in commercialreal estate to create long term stable financial wealth smarten up your realestate skills now. Hello, hello. Hello, welcome. Yes, I'm excited today. It'sit's another real estate revealed 104 point nine FM no show radio. Yeah, it'sme. I'm here, Dave Seymour, your host, you might recognize me from the TV showflipping boss, then my super sexy English slash Bostonian accent or maybe youdon't doesn't matter. But real estate revealed if you're a first time listener,welcome to the chaos, we might rattle the cages a little bit run around in yourbrain rent free without paying any dues. Because we might shake up some of yourpreconceived ideas and notions about finance and real estate, and how it's becomea tool for the wealthy. I will share some of those secrets with you every weekI bring on pertinent powerful players in the commercial real estate, investingspace, also residential real estate investing space. And we just get down anddirty with it. I'm not I'm not here to teach you how to pick the right color ofgray for your walls. I don't care what your flowers look like in the frontyard. I don't even care if you're going to upgrade your your lock systems andthe other stuff that you can do in your house. And did you put sealer on yourdriveway? None of that matters. I'm talking hard cold cash of real estateinvesting. So welcome. Welcome to the show. It's not HGTV, that's what you werelooking for. You can you can turn off the radio now and go do something else.But if you want to hang around, and really learn some some powerful tips,tricks, tools that we use as good as real estate investors, then you're in theright place. So I've got I got a friend of mine with me and I met this guythrough social media platforms if you will. And he's got his own his own stampin the marketplace here in Boston. He's He's a mover and a shaker. He's a superguy, Family Guy gives back to his community. He's got a lot of deals going on,like I said, in East Boston, the Boston Market, but he didn't always start thatway. He is now the CEO of a company called volnay VL and a y capital. And he isthe owner operator of that business and we're going to talk everything sticksand bricks and dollars and what it's all about and he's become a real goodfriend of mine. We've done some stuff together in the social media environment.And just a solid guy great, great operator of great information. And Iappreciate him finding the time to hang out with us this Saturday morning realestate revealed so without any further ado, my man Ricky Bell, have you are youthere? Ricky? Please say you are


Rick Beliveau 03:05

my man.On intro, what an intro. Thanks for having me cannot be more excited. Um, Imean, I wish we were in the studio so I could see your beautiful face but yeah,right. This is you know, this is gonna have to do over the over the airwaves.Yeah, for sure. For sure. Brother I am I am appreciative. I mean, thatsincerely of you carving out a little bit of your time for us. So Ricky, I knowthat you you manage a pretty substantial portfolio of commercial real estateprimarily in the Boston marketplace. And you know, we it's funny, we likemeasure our successes by assets under management is kind of like the you know,the measuring stick for this business, but I'm not gonna get into that. I justknow that there's millions and millions and millions of dollars of developmentthat is touched. You know, that you've you've put your fingers on in yourcareer, right? So let's let's let's dial it all back, my friend. What What wasthe first deal? What got you into this crazy real estate game? Right? What Whatwas it all about? What were you doing before we even started in real estate?Because you're a young guy you're in? Yeah, you're in your 30s or your 20s orsomething? I don't know where you are. But you're you're a young gun. Right?What What got you going brother? Yeah, so people always ask that, like, God,did you end up? Did you think you'd end up being where you're at today? It'slike, that was never the intention. Right? So I went to went to NortheasternUniversity, um, you know, studied finance and entrepreneurship. And you know,my only my only thoughts on real estate was my parents primary residence that Igrew up in. And then some of my friends had gotten their real estate licenseswhile we were in college, and that we use them to rent apartments. And midwaythrough college, I thought, oh, maybe I'll get my real estate license and endedup signing up for the course. Guts got so drunk than I thought For that I sleptthrough the course, slept, slept through the course, the whole next weekendthat whole weekend, failed the test. And then that was the end of my collegereal estate career. And, but then it all came back around at the senior year, Itook a capstone class on real estate finance. And that kind of blended my viewson finance numbers, along with what you know how real estate works in Excel andkind of, you know, the deep dive into into the financials. And it really openedmy eyes to real estate investing as as a way of life in a way that you canbuild, you know, build wealth. So after graduation, I started working infinance at Wellington management. And while I was there, I kind of made a goalfor myself to buy a rental property as soon as possible. So I started there inMay, and I talked to a lender, I said, when's the first time I can get a loan?And he said, six months? You can have w two income, you can get a loan. I said,Okay. And December 10, I bought my first rental property. So literally daysafter my six month mark, I closed that. Where was it? Was it a? Was it a deuce?Was it a two three, it was a so is it three family located on mission Hill,which is right near all the colleges, Northeastern Wentworth, mass art. And itwas student rentals, a market that I knew really well it was where I lived, Ilived in the area. So I always, I always recommend if you're going to invest inreal estate, I know you guys, you know, you invest all over the country, Ialways say, you know, if I if I that my best investments are the ones I that Iknow the area the most. Yeah. And so my first investment was where I live,there's admission Ellen, I knew the college student market, I'd actually haddone my capstone paper, my senior year on multi families in mission Hill. So itwas directly what I knew and kind of rolled it out. So did you manage that?Rick? Did you manage it yourself? Yeah, so it was actually interesting. So Ioriginally I was self managing. And so I took her took it over, I did arenovation on it, got the units rented, and, you know, was self managing. Andthen I decided at that time that I thought, you know what, I have a full timejob. I think this could be done better by someone else. I'm going to I'm gonnamove out of the management. And let me spend my valuable time outside of mynine to five on finding more assets and acquiring them and stabilizing them. SoI ended up at that point, hiring a management company to take over that firstproperty once I ended up moving out of that property because it was an FHAloan. So let that's important, right? You and I always talk about this, as youknow, professional investors, we love the power of leverage. Do you rememberthe numbers of that first investment, the ins and outs, the leverage that youused on it? what it looked like for cash flow? Do you remember that off the topof your head? Yeah, I do. So.


Dave Seymour 08:02

Yeah,you do? Yeah.


Rick Beliveau 08:05

It'spretty crazy. Because everyone's like, oh, How'd you find that home run, Isaid, I go guys, back in 2010 multi families were sitting on the market, everyday was a home run. It wasn't like it is now like it like this building wasjust sitting on on the market for over 100 days. And it was listed for a milliondollars. I offered 900,000 we ended up coming to agreement to buy for 930,000the the max loan I could get with FHA was 860,000. And so I use that I use thatFHA loan 860,000 to get you know, to purchase the property. And then I went tomy mother and actually asked her to loan me the downpayment. And if you anyoneknows about FHA, you can actually get funds gifted to you by direct familymembers. Yeah. And they'll allow you to take the gift in and use that for adown payment. So


Dave Seymour 09:08

you didyou did a note no money down real estate transaction because because mom wasthere for you.


Rick Beliveau 09:14

So rightso mom put up the mom put up the downpayment and a portion and she had a littlebit of the additional for the renovation. And then I used up my savings andthen about 50 or 60,000 on credit cards to finish the renovation to get thewhole thing going, but when I bought the building, it was a nine bed, threebath, and then over the year I turned it into a 12 bed, six bath. And in that area,it's all about bedroom count. This is pretty much similar for all over theBoston area and most of the country. Now, you know, by going from nine beds to12 beds, I was able to take the rents and you know, increase them significantlythere when I bought the building they were at 2000 a unit Today they rent for45 4600 a unit.


Dave Seymour 10:04

So youstill own that building, I


Rick Beliveau 10:06

stillown it to this day. So paid 930 and it paid 930 for it. And it just, it justappraised at 2.5. Wow.


Dave Seymour 10:15

So nice.All in around maybe one one to 1.2 1.1, somewhere around there with therenovations over the years. So you're more than doubled that investment in thatin that 10 year period of time. That's impressive. That's very, very impressive.So what, you know what, what was obviously that's giving you an appetite,right? It's like, this is kind of like printing money, right? We talk aboutthat a lot as real estate investors, I'm just printing money. What was whatscaled it from there? Rick? What What kept you rocking and rolling?


Rick Beliveau 10:48

Yeah, soI think that, you know, it wasn't quick, right? I mean, it's a journey. And Itell everybody that I talked to, and I mentor them, getting the ball rolling isthe hardest part in this business, you know, you got to get the ball moving.And then the first deal the second deal, the third deal, once you hit thethird, and you move into your fourth eye, that's what I've taught, you know,for me, and for a lot of other people, you just start to see the floodgatesopen, because you've got the experience. Now, lenders want to work with you,instead of you begging for a loan. Right and, and things start to pivot. So youknow, I about a year, about a year and a half after that first purchase, it hadbeen stabilized and I was making good money, I bought my second rentalproperty, also on Mission Hills, a four family, and I bought that one for 825.And this was back when you could still have multiple FHA loans. So you only hadto, you only had to wait a year and then you could buy, you could do anotherFHA loan. So I was able to do that purchase for 825 grand put about 20 granddown 25 grand down and was able to buy a four family property as my secondasset.


Dave Seymour 11:59

So look,man, I think I think it's important to really highlight these numbers justbecause, you know, I process them as fast as you do, right? We're like we'rewalking, talking spreadsheets, sometimes in our brains, but you put down$25,000 and you're able to borrow 825 i don't i don't know any otherinvestment, the way you can, you know, buy $3 million worth of real estate, forexample, with a million dollars. If you buy anything else, any other investmentthat you make in this world today, whether it's Bitcoin, or stocks or bonds, orwhatever it is gold, a piece of a business, you buy a million dollars worth ofwhat it is right? A million dollars worth of gold is worth a million dollarswith a gold. But when you when you plan the game as you and I do, and you justhighlighted that beautifully is the fact of the power of leverage and the factthat the banks are screaming right now for us to play with them. Right? It'sYeah, it's just it's so strong. You keep going, man, I just I get excited. Ican't help Yeah,


Rick Beliveau 12:59

no, no,for sure. And I think that that's, that's something for everyone out therewho's like, Oh, you know, I don't have enough money for a down payment. I can'tbuy a rental property. And I've probably, you know, through me and through mybrokerage, Evo Boston, you know, we have helped, you know, over 100 people, youknow, in my circle, buy multifamily properties using FHA loans. And, you know,people don't understand the ability to do a three and a half percent down on amultifamily property, and how you can use that leverage to buy something whereyou where you can live in one of the units in for free, right, you can live forfree and have their other units carrying the mortgage. And I think it's, it'ssomething that, you know, it allowed me to build financial freedom, and I thinkit's something that so many people have done and more people should do.


Dave Seymour 13:48

Yeah,no, I'm with you. Hey, look, man, we're gonna take a quick break. When we getback from that break. I'd love to get your insights on, you know, what, what,what does the landscape look like locally, with regard to the challenges weface as investors with regard to COVID? You know, it's a sad, sad landscaperight now. It's not it's not all peaches and cream, but I'd love to get yourinsights on that. So don't go away. Rick, we're gonna take a quick break.You're listening to real estate reveal with Dave Seymour right here on 104.point nine.


Intro Voice Over  14:19

RealEstate revealed We'll be right back. Today, the real estate market is boomingmortgage rates just at historic 30 year lows and the New York Times recentlyreported that investors are snapping up real estate at rock bottom prices. Andnow savvy investors are buying real estate using their IRAs that allows them toaccess their retirement funds to buy properties without paying any penalties orearly withdrawal fees. If you have funds in your retirement account, and youare interested to learn more call horizon for us today at 866-712-2007. That's866-712-2007 unlock the power of your retirement account. Take advantage of oneof the most profound opportunities in real estate since the housing crisis 15years ago, call horizon trust retirement specialist at 866-712-2007. And for alimited time, get our free Ultimate Guide to buying real estate with your IRAthat's 866-712-2007 or visit horizon trust comm slash day. Horizon TrustCompany is an independent passive custodian and is not associated or affiliatedwith and does not recommend promote or advise any specific investmentinvestment opportunity investment sponsor, investment company or investmentpromoter or any agents, employees, representatives or other such firms orentities. Horizon trust is not providing investment advice, advocating orinvesting real estate. These options may or may not be a fit for individualinvestor investments are not FDIC insured, offer no bank guarantee and may losevalue or rising trust doesn't receive any commissions or fees if I invest withany other sponsor.


Dave Seymour  15:48

You everwondered how to create cash flow outside of your job income or retirement plan?Have you considered large commercial real estate assets? You know what analternative investment strategy is with tune in for all the answers on my showreal estate revealed this is Dave see my mic recognize me from the hit TV showflipping Boston. I'm also the CEO and co founder of freedom venture investmentsto smarten up your real estate now by tuning in every Saturday for allinvestment details, visit us at info at freedom slash 104 pointnine call my team at 781-922-4418 thinking of purchasing


Intro Voice Over  16:21

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Dave Seymour 17:00

need ayou need a realtor, you know where to find them. You need a mortgage, you nowknow where to find that. And if you're sitting on lazy money, right, that lazycapital that's not performing at a high rate of return, then my friends over athorizon trust are able to help you with regard to maybe directing that capitalso that you can play in this sandbox play in the sandbox with with the guys andthe girls that you know really know the power of real estate invest in theleverage, like we were talking about before we went to the break a break, Iwant to I want to touch on something, because you probably scared the pants offa couple of our listeners, you know i honed in on it, because I recognize it.But in your conversation you said I put 50 to $60,000 on my credit cards right?As pot as part of a renovation. You know, the the mentality out there forcredit cards is that you only use them in case of an emergency right? debt isalways bad. It's never good. I learned as an entrepreneur. And I know you didas well that, you know, the credit card is just a small bank in my pocket. Andas long as I use it with intelligence for assets and asset growth, then thatthat's just access to capital that that's easy. That's absolutely easy. Tell meyour thoughts around debt and credit card debt, good debt, bad debt. Just justunpack that for a couple of minutes before we roll on down the road?


Rick Beliveau 18:23

Forsure. I mean, so I love debt. I yeah,


Dave Seymour 18:28



Rick Beliveau 18:28

I mean,and like, you know, people think I'm crazy. The more loans and the more debt Ican get, the better it is as long as it's good debt. And so, you know, the useof credit cards, it's, you know, it's still using my business today. I thinkall the all the developers, all the big players still use it for liquidity whenwhen times get tight, you know, back then it was there was no more cashavailable, right? I was I you know, I, when you're doing a project like thatearly in your career, you don't have the ability to get a construction loan. Imean, there are options now 201 k loans, you can get the loans along with yourFHA I didn't know about that don't even know if they existed when I did these.So it was used as much money as I had. And then use the credit card to get overthe final finish line knowing at the end of the at the end of the finish linethere was going to be a cash flowing asset, it was going to be able to help mestart paying that down. Now the other thing too, is like when you're gettingstarted in this, I don't ever recommend that someone dive right in and quittheir job. Right? It's a progression like I was still making a great salary ona W two and finance. So like I was able to now have a property that was makingme money every single month and I was able to be living rent free and I had agood job so I wasn't the credit card debt wasn't like oh, this is hanging overmy head is like yeah, I'm gonna get through that. But I needed it to get to thefinish line. Yeah,


Dave Seymour 19:54

you knowwhat, you know what it is credit card debt and that that that you know, accessto capital. It's funny man it's always keeping up with the Joneses, right? gooddebt bad debt cop cop, we're talking about cars, boats and leather coats, shinythings. And you know, when I first started invest in as I'm sure you did, thefirst thing we didn't do was go out and buy, you know, a Rolls Royce, aLamborghini and a Range Rover. That's not what we did. We reinvested thecapital until you get to a point where you can get into some of that, you know,non appreciating debt, if you will, like a car loan. Think about it for asecond. You know, Rick, just as it was, I, you could get car loans now, newcars up to seven years, at like, 2% interest I, the last pickup truck Ipurchased. And I said to the guys at the credit union, I said, Why seven years,he said, because people can't afford him anymore. You can't afford a car. Andit's like that, that finance mentality. And we know that as soon as you drive acar off the lot, it loses its value, unless you're, you know, a car collector.So, you know, using using debt, any kind of debt. I'm like, you man, the modethat I'm in, the more money I'm making, which is kind of like an oxymoron for alot of people to hear. But I think it was Buffett who said it right? You got tolearn how to make money in your sleep. And assets. Right? Real Estate has beenable to do that for us going forward. So no, I love it. Man. I appreciatesharing. If


Rick Beliveau 21:20

you ifyou look at good debt, right? You look at good debt right now, people ask meall the time, well, should I take out that car loan, for example, you just saidit's, if they're gonna give you the money, and it's only gonna charge you twoor 3% on it.


Dave Seymour 21:33

I'mtaking it


Rick Beliveau 21:34

take asmuch as you can, and give it to me invest in my projects, like, you know, I'llmake we'll make we'll make 10 times that and your profits? Yeah. So, you know,from that standpoint, it's like, if it's if the rate is right, you need to takethat debt out.


Dave Seymour 21:50

It'slike the it's like the haylock. Right, right. I mean, you know, there's equityin properties right now. And if and if you've got the, you know, the the FICOscore, and the and the financial depth to be able to take home equity lines ofcredit at three, four or 5%. And you can then lend that money to investors likeus, and we're offering, you know, at least double that, that cost the capital,you're playing the game for free, right, you are playing the game for free. Andit's it's such an education journey for folks to do that. So let's pivot alittle bit Brother, what what's going on in Boston? What's up with themarketplace, I was in DC the other day when, you know, your team helped meshoot that TV, commercial money, your assets there. And I looked around, and Icouldn't look in any direction without hitting a rehab or a development orwhat's going on? Is it saturated? oversaturated is still opportunity, what'shappening with the condo conversions in the marketplace? And COVID? some, youknow, influences on it. What do you see going on?


Rick Beliveau 22:50

Yeah, soI mean, a lot of but I mean, Boston has been crazy. East Boston has taken off.And, you know, back when there used to be just me and a few other players overthere. And now you as you saw, there's a project every block, if not more, youknow, COVID was tough, you know, 2020 was tough for the market, you definitelysaw the slowdown in the number of transactions. Um, you know, I don't think wereally saw decreases in price more than just there weren't buyers. Right. So itwasn't even that you could lower your price to create a sale. It was there justweren't people shopping. You know. So I think what we saw though, come the endof last year with the vaccine getting announced the election in the in ourrearview mirror. The weekend after the election, we saw more offers come inthan we had seen in the past, like three months. And he and that is kind ofcontinued through the past, you know, and the last couple weeks of the year andeven into 2021. Now that we're starting to see people back in the marketplaceback out there shopping, busier open houses, and I think it stems to thisvaccine starting to roll out and the you know, the buyers are starting to feelmore comfortable with where our country is heading into the new administration.


Dave Seymour 24:07

Yeah,let's what what have you seen on like, your financial rental collection, youknow, you might have or an investor and I'm not specifically saying you, youknow, you can have 100% occupancy, physical occupancy, but a lot of investorswho have been over leveraged without reserves don't know the game at the levelwe do. They find themselves in a position where they're, you know, they don'thave to financial occupancy, they got some challenges on collections. How wasthat for you? How did you guys weather that storm? If at all? It's all aboutmanagement at the end of the day, right?


Rick Beliveau 24:43

Yeah, I mean,we kept so we were actually sharing a bunch of this throughout the whole, youknow, whole COVID timeline of where we were at for collections. We're kind ofsharing it on social media, like on the 15th of the month, we're 60% collectedor 70%, collected and kind of gave people a sense we manage about 150 units, alot of those are owned and then other for other developers as well. Andoverall, we got through it. I mean, we were really good about working with ourtenants, letting them know that we understood the circumstances. And that, youknow, we didn't, you know, we wanted to work with them make payments when youcan. And I think it, it works very well. For us. We also, we were veryproactive about getting federal, and co city and federal funding for ourtenants. So any any chance we had to provide them paperwork that could befilled out, you know, for them to get vouchers are to get, you know, funds, wedid sell. So, we we received in a lot of city and federal money that came inregarding rent issues.


Dave Seymour 25:47

Yeah,yeah, I you know, as we've seen that in Florida, as well, it's a case of, areyou proactive, rather than reactive, you know, the ability to point the tenantsin the right direction, even when you start looking at PPP and that kind ofstuff. There are companies and firms out there that just hype it up, like crazyto be able to put facilitators in place between the PPP programs, and the, youknow, and the actual SBA loans, etc, etc. So being able to do that, you know,on the tenant level, understanding their situation, and being able to give themsome, some some breathing room and maybe lesson in some of the collections hasbeen important going forward. What what's your take on the full barend stuffaround the single family mortgages? Do you see Do you see an opportunity comingoff of that with regard to increase rental needs, as well, as you know, maybesome single family and smaller multifamily opportunities, Rick?


Rick Beliveau 26:44

Yeah, Imean, I think that that's kind of what everyone's sitting back, like theinvestors out there who have cash, you know, available are wondering whenthat's going to hit. I think they're saying that, you know, in the next couplemonths, when that rolls out, there could be, you know, issues with payments,and you could see deals coming to market. From I personally don't think we'regoing to see the deals that we originally thought. And I feel like a lot of alot of this has been able to be peeled, rode through it. And I've gotten outthe backside of it now. And I think there will be some but I don't thinkthere's going to be the massive deals that the market was expecting.


Dave Seymour 27:24

Yeah,everybody was was talking about the the pennies on the dollar, you know,tsunami, kind of parallel to 2008 910. And I agree with you i i don't i don'tsee that either. I tell you, what we're seeing Oh, Rick, down in the Floridamarket is the smaller we and we talked about this one on one last time, we werehanging out the smaller mom and pop operators. Without the reserves without thethe systems or processes, you know, the amateur investors, they're the onesthat are reaching out to us now. We're seeing a huge increase. And, you know,every market is local, right? You've heard that before in real estate. Butwe're beginning to see inbound lead generation spike pretty dramatically in theFlorida market, where we're beginning to underwrite, walk in and acquire 15 and$22 units and 81 units, we got a larger one that we're about to take down 160doors in the northern Gulf Coast region of Florida, but there's definitelythere's definitely a shift. But I guess for me, it's you know, is it off marketstuff that that's probably going to come because it's not all going to hit themarket, it seems to be the conversation is Hey, I'm in trouble. Can you help meand they go to operators like you? Have you seen any of that yet? at all? Or?Just a couple of whispers of it?


Rick Beliveau 28:45

Yeah,we've definitely had, we've probably bought five multi families in the past twoor three months, all of them off market direct calls, and it's typicallyvacancies or it's, you know, landlords who thought thought being a landlord isgoing to be fun. And like you said, small mom and pop guys who are looking atthe asset and they're saying, you know, this isn't this isn't working out as Iexpected, um, and that they're making, you know, looking to make a transitionand we're able to come in and buy those.


Dave Seymour 29:19

Alright,I love it. His we're gonna do we're gonna talk in a little bit and take a quickbreak again, we're gonna, we're gonna come back we'll talk about passive andactive. Those that thought that you know, being a landlord will be fun and aneasy ride. Right. Some of the lessons some of those lessons we've learned,they'll go away. I got a I got a kick butt guest and Rick valleyview fromvolnay capital, and we're gonna be right back. He'll go away. I'm loving this.Thank you, Rick.


Intro Voice Over  29:48

RealEstate revealed We'll be right back.



Stevemolestus of Solaris realty has intimate knowledge of the North Shore marketwith over two decades of experience and record of 300 real estate transactionswhen it's time to buy or sell property. Give Steve a call directly at617-763-1001 that's 617-763-1001


Dave Seymour 30:21

you everwondered how to create cash flow outside of your job income or retirement plan?Have you considered large commercial real estate assets? Do you know what analternative investment strategy is with tune in for all the answers on my showreal estate revealed this is they see my might recognize me from the hit TVshow flippin Boston. I'm also the CEO and co founder of freedom ventureinvestments to smarten up your real estate now by tuning in every Saturday. Forall investment details, visit us at info at freedom slash 104point nine call my team at 781-922-4418. Today the real


Intro Voice Over  30:54

estatemarket is booming mortgage rates just at historic 30 year lows and the New YorkTimes recently reported that investors are snapping up real estate at rockbottom prices. And now savvy investors are buying real estate using their IRAsthat allows them to access their retirement funds to buy properties withoutpaying any penalties or early withdrawal fees. If you have funds in yourretirement account and you are interested to learn more call horizon for ustoday at 866-712-2007. That's 866-712-2007 unlock the power of your retirementaccount and take advantage of one of the most profound opportunities in realestate since the housing crisis 15 years ago called horizon trust retirementspecialist at 866-712-2007. And for a limited time, get our free Ultimate Guideto buying real estate with your IRA that's 866-712-2074 visit horizon plus.comslash date. Horizon Trust Company is an independent passive custodian and it'snot associated or affiliated with and does not recommend promote or advise anyspecific investment investment opportunity investment sponsor, investmentcompany or investment promoter or any agents employees, representatives orother such firms or entities arising from providing investment advice,advocating or endorsing real estate. These options may or may not be a fit forindividual investor investments are not FDIC insured, offer no bank guaranteeand may lose value or rising trust doesn't receive any commissions or fees. IfI invest with any other sponsor. You're listening to real estate revealed withDave see more from Amy's flipping Boston.


Dave Seymour 32:22

Yeah,we're we're opening it up today. We really are we're peeling back the onion ofreal estate investing when my real My dear friend, local developer kicking butttaking names. Rich Bellevue rich. Before we went to that quick break there wewere talking about, you know, you said I think you picked up maybe four or fivemultifamily assets in the past couple of months. And some of them were frompeople who thought that they could be a landlord and yet they hadn't. So wetalk a lot about passive and active investing. You know, I like to will bringin passive investors, people who want the upside the the, you know, thefinancial, huge financial gains of real estate, and yet they don't want to doany of the work. That's a passive investor. That's a smarter investor. And thenguys like you and I, man, we got the scars, the lumps or bumps, the bruises,the pain, the stories of building our own real estate, you know, portfolios andstuff. But what's couple of just a couple and then we'll roll into what you'vegot going on right now. But what's a couple of the things that you hear themost from from the mom and pop the the man, the woman who bought a three Deckerand all of a sudden it's it's ruined their lives, what some of the challengesyou hear from


Rick Beliveau 33:36

mostnewbie investors, they the biggest mistake they make is they don't take intoaccount vacancy, they think all the roses are gonna smell beautiful, right? Allthe cakes gonna taste great, and that they don't consider the fact that some ofthese tenants are just going to not pay rent. And some of the tenants are goingto pay rent, and they're not going to leave. Sometimes they're just going toleave, and you're going to say you're going to call them and say where's myrent? And they're gonna say, I don't live there anymore. And then you're thenyou look at it from the decision, you say, is there any recourse? Or do I justmove on? And most of the time you just move on? In depending on the lease, anddepending on the cosigners. But, um, you know, so that's, that's one main thing.And then I think under estimating the expenses, it's just, it's, it's a anissue that we continue to see with, with newbies that, you know, they'rerunning their pro formas, based on the simplest numbers of water, electricinsurance, and the cap x. It's like, well, what's the repair number going tobe? And I think, you know, early on, I survived by not having high enough cap Xnumber, but I was also in a roaring market, right? We're in a market where thevalues of properties are climbing, you know, day after day, they're going up.And we're not there right now. And you'll continue to see real estate go up,you know, in the Boston area and in the surrounding areas will continue torise, but it's not rising at the rate than it was so you could you could makeup for For lack of catbacks, and not understanding the expenses, based on thefact that rents were climbing so quickly, and the values are climbing soquickly. But I think what's happened now, you've been in a plateau the pastyear, two years, you There's nothing, there's nothing saving those investors.


Dave Seymour 35:18

Right? Ihad I had an investor Cole earlier on this week, actually. And I just said tohim, I said, Look, you're going to invest 250,000 and a half a million dollarswith us either on a single asset or whether you come into our, our equity fund.And I just said to him, the one question you need to ask yourself, Is this andit's a real simple one, do you believe the value of real estate is going isgoing to increase in the next seven years? And if you can answer that with ayes, then make the investment. And the other challenge as you as you know, Rickis kicked it is everything you're doing with your investment dollars,outperforming, outperforming inflation. And that's that's the you know, that'sthe scary monster hiding in the corner of the room. But to your point on, youknow, under estimating expenses, you know, that's, that's a science, that's ascience, whether we're doing an 80 unit, 160 unit, or, or an eight unitacquisition, there's a science to that, and a lot of that science andunderwriting you'll testify to this is based off of experience, right?


Rick Beliveau 36:18

Yeah,100% I think as you get you know, more and more assets under management orassets that you own, you start to you can, you can quickly see what the numbersare going to be. And you know, you can't trust any one who's selling amultifamily. They can tell you, they're providing you the full financials ofthe property. They're not. And I don't care whether what they're providing youit is not the true financials. So


Dave Seymour 36:42

tell methat sellers lie. Is that all the time? Oh,


Rick Beliveau 36:47

and soyou know, I'd say you know, that when they send you that Excel file, and itshows it as a clean building with just water electric, and a cleaning everythree months, there's been triple the expenses, and you don't know about,


Dave Seymour 37:00

so it'sthe one, the one that always cracks me up is they put out 150 bucks a year forsnow removal.


Rick Beliveau 37:07

Yeah.The one point is that one, though, that's half a storm.


Dave Seymour 37:12

That'shalf a storm, if we're lucky, if we're lucky. All right, man, let's let's let'stalk about some of the I'm sorry, but they are just sexy projects. You send mepictures of your projects that you've got going on some completed someconstruction. And you know, it is absolutely eye candy. It's eye candy in realestate. What are you working on right now? What do you got going on? What'staking up the majority of your time, your focus and your energy?


Rick Beliveau 37:39

Yeah, sothe business is really grown over the past couple of years. I mean, our corebusiness is, is still our condo development, small scale. So that's, you know,two to nine unit buildings. We have those going on in East Boston Dorchester.You know, that's, that's still our bread and butter. I mean, that's where we'vecut our teeth, you know, from a development standpoint. And that's going great,you know, units are moving well, and we continue to push the limits with ourdesign. And I think we put out the top product in the market. And we continueto, you know, put stuff out there that buyers get to see and it doesn't looklike everybody else. I think we've always done that. And it's worked for us andwe continue to do it is we're not cookie cutter. And it's and when a buyer islooking at 30 or 40 options is what you know now in East Boston, there's 100condos on the market, what can separate us and I think that's what we do reallywell.


Dave Seymour 38:33

Yeah,the design. Sure. I'm looking at I'm looking at a picture of that property on35 Pearl Street, in Charlestown, I mean that thing just pops you know you'vegot like the like a wood wall that the clavate exterior with the black doorsand the gold lettering. It's just a beautiful little bell that I watch funny isis it sitting right next to a piece of doodle Kaka right it is like this thingscreaming in the marketplace. What about some of these bigger projects techGive me the Give me the the the flavor of the 600 and share a little bit aboutthe that larger tower that you were talking about? On the on our lastconnection there if you can, I don't know whether that's secret squirrel rightnow. But yeah, that was larger projects.


Rick Beliveau 39:21

So yeah,so the 600 is our 85 unit rental building that we are breaking ground on, youknow, actually, right now we're starting our abatement and getting the siteready for demo. So that's located in 600. Broadway in Everett next to City Halland that will be our largest project to date. It's been a wild ride throughoutthe past year the equity in the debt markets really dried up through COVID. Soit was it was a challenge but we now have we've we've secured our equityfinancing on that and we have our bank debt lined up so we're ready to rockhedge Callahan construction is building it for us, guys.


Dave Seymour 40:05



Rick Beliveau 40:06

So we'regonna be we're excited about having them on board. And we'll have that completedby spring of 2022. For a lease up by September of 2022. That's kind of ourgoal, and we keep pushing towards that.


Dave Seymour 40:20

Nah.Now, did you? Did you decide to stay all residential on that? Or did you areyou committed to the to the retail, I'm looking at your your drawings here.


Rick Beliveau 40:31

Yeah. Sowe do we have the project has three retail spaces. So it's got a largerestaurant. And then it has two other retail spots. We got really lucky, weactually have a great partner in the project from square deli. Chris hascurrently run a restaurant in Everett, for the past 12 years. And he is waslooking to take his restaurant to the next level is more of a small takeoutplace. And now he wants a full liquor license full bar restaurant. So heactually is already signed in and his lol to take the restaurant space. Sowe're going to be helping him and building that space out side by side. So bythe day we open, he'll his brand new restaurant will be opening right next tous. So we're really excited about


Dave Seymour 41:15

that.That's so good. I look man, I'll bet you man. I'm so like my gut feels likeit's punched. You know, when I start thinking about how the restaurant businesshas taken such a beating such a bad like good solid men and women who work sohard to build these businesses. You know, knowing that you've got that dooropen wide open for this guy when it comes through. Now, in a situation likethat, how do you how what is your debt stack look like? How do you how do you structurethose you do a 7030 with a with a with the financing with the banks, and youraise the private capital. So that kind of like the same way we do.


Rick Beliveau 41:50

Yeah,exactly. So we ended up we ended well, it was tough. We ended up getting onthat deal. We have 9 million of equity, and 19 million of debt. Okay. And thenour structure with our equity partner is, you know, we came to the table with5% of the equity, they came to the table with 95. Yeah. And then we're sorttherapists Ooh, and then we have additional hurdles that we hit. And as theyhit certain hurdles, it's the pit the ownership pivots in our direction.


Dave Seymour 42:23

Gotcha.Yeah, gotcha. Yeah. So a waterfall structure going forward? Do you work onlywith accredited investors as we do, Rick? Or do you? Do you open it up throughlike a reggae fund or anything like that.


Rick Beliveau 42:34

So onthe large projects, that's, that's a single cheque size. So we took one, wehave one large equity partner, who is putting up the whole 9 million, you know,we were looking at having accredited investors and raising it that that way, itthere, it's it's definitely more profitable from our side to go with a smallerinvestor and more of them. But when we looked at the market, we're in the largecheque size really just made sense to get the thing financed to get the debtand equity lined up. So we just that's the direction we went interest. Andit's, you know, when


Dave Seymour 43:08

you takethose larger checks, and you actually you actually buy yourself a partner goingforward, for sure, for sure, we're working with a with an investment groupright now is contemplating checks in the in the region of 50 to 75 million andit's it's, it's it's an interesting conversation for somebody who say, I cantake out your, your private equity fund with one or two checks when we'redealing with with that amount of capital. But you know, it comes with it comeswith conditions. know,


Rick Beliveau 43:38

when Ithought for me, this is obviously, my first large project, we've got a fewother large ones in the pipeline, you know, can't discuss all the details ofsome of them. But we've got we do have a 54 unit in Dorchester, and then I'mworking on a very large project in Worcester now. Right, it's attached to thenew baseball stadium. So I'm excited about that word. Yeah. But the you know,with the with the large check partner, you know, the nice thing is as I'mmoving into these larger deals, I wanted a partner with experience you know,and I've always been wanting to take in knowledge from everybody right i'm i'mi know i still have a lot to learn and I'm not gonna sit here and say I knoweverything so when I'm coming into this you know, first of my many big deals Ihave coming up I want that knowledge and you know, it was a great fit.


Dave Seymour 44:29

Yeah,for sure. I love it man. I love I love the progression of a real estateinvestors career never given up right stay in stay in the course. learning moreconsistency, una una a cut from the same cloth we live, breathe and eat thisstuff. And it gives us gives us purpose every day to get up. Look, man, how cananybody and I mean anybody, get a hold of you and somebody in your company,whether they want to learn more about what your business does or you may beleveraged. Some of you Your real estate services, what's the best way to get ahold of Rick and his team?


Rick Beliveau 45:04

Yeah, soI think the best way is just go on to Instagram and go to volnay capital. Okay,you know, give that a follow. And I think the great part about our Instagramaccount is that we were an open book. So we're sharing what we're doing. We'resharing our financials, we're sharing the projects, we're sharing the detailsof purchases, and this type of knowledge that your guys are getting today. Youknow, we try to put that out on a day to day basis on that account. So givethat a follow shoot me a DM and you know, we always respond so you can


Dave Seymour 45:33

hold onhold on a minute, I want you to miss out either. Not all of our listeners, haveInstagram accounts and can follow with a DM but they don't even know whatyou're talking about.



Whatabout you?



Whatabout some old school?


Rick Beliveau 45:47

You canalso find us it's www dot volnay


Dave Seymour 45:52

Don'tforget that one. Brother. I appreciate you spending time with us here. Thankyou for dropping all the pearls that you did. You're listening to real estaterevealed. Dave see more. Rick ball, Rick powerview from volnay capital, we'llbe right back.


Intro Voice Over  46:09

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Dave Seymour 46:48

you everwondered how to create cash flow outside of your job income or retirement plan?Have you considered large commercial real estate assets? Do you know what analternative investment strategy is worth? Tune in for all the answers on myshow real estate revealed this is Dave see my might recognize me from the hitTV show flipping Boston I'm also the CEO and co founder of freedom ventureinvestments to smarten up your real estate now by tuning in every Saturday forall investment details visit us at info at freedom slash 104 pointnine drop any pearls on wisdom in the real estate investing world. I'm on it Ireally am. I'm blessed to be surrounded and inspired by a lot of very, veryfast. Developers, entrepreneurs, real estate developers direct from from asingle family world all the way up to the larger deals one zero like Ricky doeslike Pam does, I feel listened in last week. And yet you got to listen to Pamparty, young lady, you know just doing the same thing in the marketplace. Butthe opportunity listening to real estate revealed. You know, he has a similarbusiness model as we do. So name of my company is freedom venture investments,you can contact us directly at 781-922-4418. We're kind of old school here wewe still answer the telephone and communicate. But you know, what we do is thisis we put the opportunities that most people will never see in their lifetimefor investing right in front of them. If you walk past or you've driven pastsome of those, those beautiful developments that have been going up in inBoston, East Boston, remember we're on Route one right on the turn therethrough Chelsea into the city, there was that huge apartment complex that wentup on the left, then you looked on the other side, there was a huge apartmentcomplex that went up on the right, then you'd see some of these these older buildingscoming down. And these newer these newer retail mix retail, you know, high endcondo facilities being raised. And, you know, prior to being a real estateinvestor myself, I was a firefighter and a paramedic for 16 years here in thecity of Lynn. And I used to drive past these things I say to myself, Oh, Who'sthat? Who's got the money to build those things? How does that all work? So youknow, real estate reveal this the secrets of how it works. It works throughpeople, leveraging other people's experience and expertise. I'm not a doctor,I'm not a lawyer. I'm not a chiropractor. I'm not a financial planner. Youknow, I'm not a I'm not an accountant. But I leverage all of those people'sexpertise when I need them. Right. So if, for us it's it's a story of allowingthe average investor access to institutional type investments. And that's whatthat's what we're talking about when we talk about the kind of deals that Rickjust described. And then what we do at freedom venture investments. Now you cancontact us like I said with the phone number or get us at WWE dot I'll give you the short version of what we do, why we do it, how wedo it and where we do it. So we invest in Florida, there's a number of reasonswe invest in the Florida market rather than up here in New in New England,there's no right or wrong, it's just left or right. They all work. It dependson the team and the business model that a developer like, like ourselves have.So we're in the Florida market. And what we buy our large apartment complex ispurely residential already built, we don't build from the ground up. And whatwe do is is we identify properties that have challenges. Maybe they've got sometenant challenges, nine times out of 10 is Rick described to us all here thatthe management challenges managers who don't understand the mechanics of thebusiness of owning, managing, repositioning what we call commercial real estatein the in the multifamily class. So we like the smaller units in Florida thatseems been established down there for over 25 years. interest in a lady wholistens in every week, was on a call this week with our Chief InvestmentOfficer, my friend, Walter Novick, he has been on the been on the radio showwith us a couple of times, and Walter has been doing this for for over a decadein that marketplace, and we buy the smaller apartment complexes, 50 to 150units, we buy them based on their actual numbers, we reposition them, we ownthem for five to maybe seven years, we sell them. And the way that we includeyou, the investor is you get to invest alongside us. So we don't over leverageour acquisitions more than 65%. You heard me ask him Rick house, how's yourdebt stack, that's what the cool kids call it your debt stack? How do you stackup your debt. So we bring in our bank and relationships, they put up 65% of thepurchase price of these acquisitions. And then you and I together, we pull ourcapital, and we put up the rest of the money to buy these deals. So if we'rebuying a deal, we got one right now it's, it's a combined acquisition price ofaround 44 point 7 million for 81 doors. So on that 4.4 point, sorry, 4.5million, will raise about 2 million in this example, we got a little aggressiveon the raise, because we've got more work to do on these properties. But we'llraise that $2 million. And we'll all go in and invest on this propertytogether. Now, this is important, if you've if you're unhappy with yourinvestments that you have right now, then you might want to take some notes, ifyou get the time to do so what we do is is we target double digit returns forour investors anywhere between 10 to 14% quarterly distributions on the capitalthat they put into our fund or into our single assets. They work on that cashflow, they receive those quarterly distributions. And then when we sell theassets, our investors participate in what's called the upside, or the equity onthe property when we sell them. And we share that equity between us themanagers, and you the investors going forward. So at targeted what are calledIRR, or internal rates of return, which is a calculation of the value of moneyworking for a five year period or a seven year period, depending when we exitout of a deal is in the in the region of 2021 22% targeted IRR, those numbersare aggressive. But here's the magic of this business, you now also get all ofthe tax advantages. You know, you get to leverage the bank's money we get tobuy, right, we put up a million we get to buy $3 million worth of real estate,we then get to use the tax code in our favor. And the tax code says we getwhat's called depreciation, which means we get to write off expenses, we get todepreciate the value of the assets I can get all crazy and silly with is thattalking about cost segregation, and some of the tools that we use. But what ifyou could invest 100,000? receive 60,000 and pay no taxes on it? Hmm. Legally,honestly, and ethically, because you're leveraging the expertise, theexperience, the skill sets, the track record of somebody else, that's what it'sall about. And and that stuff excites me. That stuff excites me. And I stoppedthinking about, you know, 401k accounts and you know, the the three things justCertified Financial Planner didn't share with you. What does that look like?Ask your financial planner to show you four or five commercial real estateinvestments that paid double digit returns targeted out and your financial planand 99.9% of them don't have access to it don't understand that going forward?It's a select group. It's the institutions it's the one percenters goingforward, have been playing in the sandbox for a very long time. So listen, thisis important as well. We can only work and you heard me ask Rick on theinterview that we can only work with what are called accredited investors. Nowan accredited investor is that termined by the Securities and ExchangeCommission, they don't let me talk about these investments. They don't let mecreate these investments. Unless I go through their their scrutiny for want ofa better term, we created what's called a 506 c regulation D Securities andExchange Commission fund. And that says that only accredited investors caninvest alongside us. Meaning it's an individual who earns $200,000 a year offamily earning 300,000, or a net worth, if you will have a million dollars. Nowthat sounds like a lot of money in today's society. But when you begin to lookat the fact that that also includes retirement accounts, that also includes anyother assets, your stock account, your your 401, K's, etc, that accreditedinvestor classification really isn't that far away from where a lot of peopleare. It's a conversation, right? It's asking questions. Those those that seekshall find it's one of those moments. And it's a moment of to thine own self betrue. I again, look, I came from a world that said the only way to get rich wasto work harder. And that meant I had to trade more time for money. And I wentto dinner last week with a physician and investor part of that group, and asuper, super gentleman, and we went and we broke bread was great, we were stillCOVID compliant. And I said to the doctor, I said, How many hours a day are youyou know, putting in in your practice? This guy is a plastic surgeon. Andbetween his his practice his education, he runs an education, business as wellfor Botox injections and those kinds of things. You know, this this guy, a highearner, intelligent man, good man, was probably up to about 85 to 90 hours aweek that he was involved in his business. And I kind of I don't know that Ihurt his feelings because he trusts me enough to give him a rude awakening. ButI just said to him, I said, You're a highly paid technician. Because if youdon't show up in that job, you don't get paid. I said, What do you think aboutactually getting some capital and putting it to work in a passive capacity,leverage my experience going forward. And we started breaking down theinvestment opportunities that freedom venture investments has for accreditedinvestors. And it was very interesting, because word of mouth is a beautifulthing. And within a week, so there's three other doctors who are standing onpoint, ready to rock and roll and play with us in this sandbox. So, you know,my charges the same every week, it's a challenge. It's a challenge. You know,if we keep doing what we've been doing, we keep getting what we've beengetting, you know, the definition of insanity, doing the same thing over andover again, expecting different results. So what results do you want in 2021?financially? Do you want to sleep better? Do you want to worry less aboutmoney? Would you like the conversation to be not dominated by COVID and thecrazy, you know, political landscapes in which we live? What do you havecontrol over what you don't. And if you pick up the phone, and you call us at781-922-4418, we can show you how to maybe take back some control, sleep alittle better, smile a little bit more, and have some confidence and comfort inknowing that you are owners in assets and no longer you know, succumbing toliabilities. So that's my message this week real estate revealed. You've beenlistening to Dave see more. Tune in next week. I've got another investor fromProvidence, Rhode Island, and she is an absolute Rockstar as well name is ElliePerlman. I can't wait to have her on the show. I look forward to talking to youvery soon. I'm here I answer the phone. God bless you and take good care ofeach other. See you next week.


Intro Voice Over  59:13

Anysecurities being offered are under an exemption provided by sec regulation Drule 506 c only accredited investors who meet the SEC regulation d 501.accredited investor accreditation standard or who provide suitable verificationof accredited status may invest into these offers. Any historical performancedata represents past performance past performance does not guarantee futureresults. June again next Saturday at noon for real estate revealed hosted byDave Seymour, the star of age loving Boston and CEO of freedom ventureinvestments in Denver.