Real Estate Revealed

#18 - Dan Kwak, Exceptional Talent of Kwak Brothers

Eric Wilson
February 22, 2021


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Dave Seymour,Intro Voice Over, Dan Kwak


Intro Voice Over  00:00

Have you ever wanted to create cash flow outside of your job income or retirementplan? Have you considered large commercial real estate assets? Do you knowabout alternative investment strategies? Keep listening. This is real estaterevealed hosted by Dave Seymour, the star of a nice living Boston and CEO offreedom venture investments in Denver. Get the real deal about investing incommercial real estate to create long term stable financial wealth smarten upyour real estate skills now.


Dave Seymour 00:36

Alright,Hey, welcome. Real Estate revealed you know what time it is, don't you? Yeah,you do Saturday morning. 11 o'clock. How's your weekend? The kids behavingthemselves? Is your is your partner behaving themselves? How are you doing?You're listening to a real estate show. But it's not your your HGTV Peytoncarpet? No, this is something special, something different. My name is DaveSeema might recognize me from the TV show flippin Boston, ran on the a&enetwork. And if you don't, that's okay. I'm also the co founder and CEO offreedom venture investments. And we are a commercial real estate investmentcompany. We put investor capital to work at higher targeted yields most othervehicles in the marketplace. But what I also get to do is every single week Iget to bring in really, really cool people to talk about the financial side ofreal estate. Most people only familiar with their primary residence right? Theyprobably own no more than three or five houses in their in their wholelifetime. And everybody says a nose on the whisper of the wind, that wealth iscreated through real estate. Well, we unpack that on this show. And I get tobring people in who are not only talking about it, but are actually doing it aswell. My guest today is is a friend of mine. He's a cool, cool cat. His name isDaniel Kwok. He is one of what are known as the Kwok brothers he and hisbrother run and a real estate investment company. They're based out of Chicago.They were immigrants to the United States of America, just like I am, came fromanother place came here, put in the hard work, put in the effort took therisks, if you will got educated implemented what they learned in the world ofreal estate. And today Dan and his brother are running not only a fantasticReal Estate Investment Company, but they're also running an exceptional and Iuse that word purposefully an exceptional real estate education business. Sopeople want to learn this game at the highest level possible. So my mandrumroll please. Are you there? Mr. Dan Kwok? Yes, I am. How are you? Myfriend? Our good buddy. I'm good, man. It's good to hear your voice. How is it?Man? It's got to be a little chilly out there in in the Chinatown area, right?Yeah.


Dan Kwak 03:02

Negativethree degrees today. Negative three today? Oh, three. Why don't we do it? Dad?What the heck are we doing brother? We're living in the coldest parts of thecountry. And we make our money in the warmest parts of the country. What are wedoing? Please tell me and I don't know. You know, it's, I always say theweather could be cold. But if your ideas are hot, everything's alright. Oh,smooth, smooth operation. Hey, you know, I only need I only need three thingshot in my life. I need I need the market. I need my wife and I need my tea. Andthat's all it is. Man. It's a good life that those three things. It's funnytoo. You didn't get to meet my kids because we just got to hang out atStarbucks that day when I met your beautiful wife and she is she is I'll berespectful as stay with beautiful. But my little guy Bennett. He's now nineyears old. And a couple of weeks will be nine. He was about six years old. Andhe comes up to me one day and he looks at me and he goes that I figured it out.I go What's up and he says When I grow up, I want to get a warm wife. Like hegoes yeah, I want a warm wife. I go Why is that? It goes well that you knowyou've got mom she's a hot wife. So I need a warm wife. I can't there's onlyone hot wife and you've already got it dad. So anyway, we digress a little Dan,tell my listeners about this journey. I mean, I looked I looked up online I didsome background on you more than I already knew. But tell me about thisjourney. From you know from your past your parents Your father was that was apastor Tell me about your background a little bit man and what it was like comingto the states and you know, some of the challenges that you overcame to bewhere you are today. Yeah, and I love that word. You use my brother journey,you know, and it's an adventure man. It is a wonderful, wonderful adventure andI love being friends with you because you and I are a lot of like where we weretwo guys that enjoy the journey more than we do the results. No Guys like Gusmen were the ones that stick around. You know, there's a lot of cats, they onlydo real estate when everything's going well, and the markets hot andeverything, you know, but we always find ways to stay in the game, we know thatthere are, there's always opportunities in the market, you know, marketschange, but people don't problems don't. You know, and we're problem solversday in and day out. So, I love the I love the word use, but you might myjourney, speaking of journey, man, it starts as an immigrant and I came to thiscountry when I was only five years old. And I'm a young guy, you know, I'm onlyin my late 20s now, but my dad's a preacher, my mom taught piano, and, youknow, we came to this country with absolutely nothing. And, you know, we weredirt poor, you know, rent, I think, was 390 bucks a month. And, you know, mostnights we didn't have, we didn't have food, you know, and there was some nightswhere we slept in our car, because we couldn't afford to pay the heating bill.And Dude, you know what, man, I remember when I was six years old, you know, mybrother and I were in the backseat curled up, my parents thought I wassleeping. I wasn't. And I remember my mom having a conversation, my dad, butwhat they were going to do about retirement. And my mom says, you know, honey,we can't even feed our kids, we can't even feed ourselves now, how are we goingto retire. And I remember, the first deal i did was i bought a portfolio ofsingle family houses that served as my parents retirement fund. So nice. That'swhat's possible with this whole real estate game man. And I don't know of anyother assets I could have done. Or I could have used to get to where I amtoday, you know, which is to take care of my parents, you know, being able toprovide for my wife and create a lot of opportunities for other people. Sowhether you do it actively or passively, which by the way, if you're doing itpassively, you got to hit up Mr. Dave Seymour with freedom ventures, becausehe's always got some great opportunities for everybody. Like journey, man.That's how we got started. We were immigrants, we didn't speak English, wecouldn't even apply for government assistance. So we didn't know how. And youknow, that's kind of my entire childhood. And it led up to you even the highschool, I didn't go to prom, I didn't go to homecoming. I didn't get to enjoy alot of things. But it made me hungry. It made me appreciate the dollar. And itmade me appreciate the opportunities, more so than the outcome. You know, what,then I love you keep on using the word opportunity. Right? And we are we are acouple of guys very similar. You know, I got a few years on here. But I youknow, I played the I played the game by the by the, you know, the big picturerules for a very long time. And you know, didn't necessarily financially whenplaying it that way, trading time for money. And you and I've talked about thatfor hours. But you know, what's interesting is you consistently talk about theopportunity and our country for all of its faults, still supplies, right? Themost wonderful opportunities there are for people who want to participate inthe game, whether it's you know, whether it's retirement through real estate,whether it's getting out of debt through real estate, describe for me theopportunities that you saw when you started brother, because you know thathunger drives you. But not everybody can can do what what you've done and whatwe've done, because they tend to quit. For some reason, it seems to be okaythat you start something and you don't stop, right? You start it and then youjust you just it's okay for some people to start and then they stop they likejust give up. What were the opportunities that you just pounced upon? Man, whatwas the first few deals you said to yourself, man, you know, we live in asociety where people value the outcome more than the opportunity. And that'sthe problem that most people have. Nope, because when you when you when youcreate a structure like that, where the outcome is more desired than theopportunity, you you're inviting the door for self limiting beliefs, you'reinviting the door for expectations not being met in your life. But you know,for me, it was it was a no brainer, I wanted to pick a craft, I wanted to picksomething and just master it. So my first deal man was a portfolio singlefamily houses. And then shortly after, you know, about three months later, fourmonths later, I bought my first apartment was an eight unit apartment buildingthat actually bought no money down. So those are my first two opportunities,but that's what it is kind of what we're just saying now. And you know, Dave,I've had the pleasure of learning a lot of things from you, but just by beingyour friend, you know, you've got a lot of experience in your belt, you got thebest of both worlds really, you got a lot of experience, but you still have theenergy of a guy my age, you know. I love hanging out with his brother


Dave Seymour 09:12

thatthat's just straight up passion. That's passion and drive. I'm so passionateabout the the opportunity for my investors today than I am for myself. Whichyou know what


Dan Kwak 09:22

usuallyusually the guys that are like that the guys who are older and still have thatenergy in jail, it's usually not passion. It's usually some something else somesubstance, you know, I won't say the name on the radio show, but not me.


Dave Seymour 09:34

So for31 years


Dan Kwak 09:37

youknow, these those guys a little little twitchy if you get what I mean. Butyeah, for sure. You know, it is the opportunity. So when I first got started inreal estate, which I got involved with real estate, because, you know, eversince I was a kid, I wanted to do a lot of things for the world. I wanted toyou know, I had dreams of building hospitals in Africa and, you know, helpingout with things that I was really passionate about. I got I've got a big heartfor inner city You know, kids, you know, kids who grew up in the projects atthe Southside of Chicago is something that I'm very passionate about, you know,two of my best friends actually grew up in the Southside of Chicago. And, youknow, they tell me, every time we hang out, you know, we talk about the issuesand the problems that's actually happening, you know, over there and what wecan do as problem solvers to do so. But the way I got involved with real estateis I was a big Chicago Bulls fan growing up. You know, I love basketball,Michael Jordan was actually the first player I ever watched when I first cameto America, and realize


Dave Seymour 10:31

I'm inBoston, right?


Dan Kwak 10:33

Yeah, Igot to grow. I know. I


Dave Seymour 10:34

know.Alright, man, I just wanted to throw it out there. I'm gonna keep going. Keepgoing, Hey, you guys got


Dan Kwak 10:39

thebetter team right now. So you know, it's got a lot to celebrate. But so I was abig fan of the bulls. And you know, this one day, I picked up a biography. Itwas a biography of the guy who owned the bulls guy named Jerry Reinsdorf. And Iwas 17 years old. And I saw that, you know, this guy had made his money byinvesting in real estate, he was a CPA and attorney, and started investing incommercial real estate in Chicago. So I was like, Man, that's what I got to do.That's what I got to get involved in. And so I studied my butt off, I'd get upat, you know, six, seven in the morning, go to sleep one or two at night. Andthe whole time aside from you know, working out or eating, I would just beobsessed. And there's one thing that people always say is like, oh, follow yourpassion, follow your passion. And for me, I don't know I I kind of disagreewith that. I understand it works for some people. But for me, what the reasonwhy I'm at where I'm at today is my curiosity. I've always followed mycuriosity, as opposed to following my passion. I was always curious about realestate. And even to this day, I'm still very curious about real estate and whatI could learn. So you know, I would say to a lot of people that want to getinvolved with real estate, figure out the things within the real estateindustry that you find intriguing, that you want to learn more about that thatdrives your curiosity, and then let your curiosity lead you as opposed to yourpassions, because I mean, our passions change every single year, every fiveyears, 10 years. You know, it's very deceiving.


Dave Seymour 12:02

I, Ilike that word, man. Curiosity, right. Always, always be learning. Always belike, we're familiar with ABC always be closing, but I'm gonna throw a new oneout there abl always be learning. Because to your point, it consistentlychanges, right? it consistently changes COVID has created, you know, justunprecedented change. From the way the government has looked at the problemfrom the way the real estate market is addressing the problem, from the waythat wall street is addressing the problem of COVID. Because if you're notcurious, if you're not engaged in the conversation, and we've had this, this,you know, one on one talks about this, that the human condition of, you know,just close your eyes, and maybe it'll all go away and get better. Doesn't work,right? People have to participate or not, and if they don't participate, thenthey suffer the consequences. Hey, Dan, we're gonna take we're gonna take aquick break here. But when we get back I'd like I'd like to build off of whatwe just dropped there. What's going on today? You know, why is it that youknow, the the yield is so low for most other investments, and yet guys like usin the commercial real estate space. I mean, we're on fire. We're on fire. Sowe'll talk about that when we get back. You're listening to Dave Sima, Dan Kwokon real estate reveal.


Intro Voice Over  13:25

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 and take advantage ofone of the most profound opportunities in real estate since the housing crisis15 years ago, call horizon trust retirement specialist at 866-712-2007. And fora limited time, get our free Ultimate Guide to buying real estate with your IRAthat's 866-712-2007 or visit horizon slash day. Horizon Trust Companyis an independent passive custodian and is not associated or affiliated withand does not recommend promote or advise any specific investment investmentopportunity investment sponsor, investment company or investment promoter orany agents employees, representatives or other of such firms or entities horizontrust is not providing investment advice, advocating or endorsing real estate.These options may or may not be a fit for individual investors investments arenot FDIC insured, offer no bank guarantee and may lose value or rising trustdoesn't receive any commissions or fees if I invest with any other sponsor.


Dave Seymour 14:54

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 Dave see my might recognize me from the hit TVshow 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 104point nine call my team at 781-922-4418 thinking of purchasing a new home


Intro Voice Over  15:27

secondhome or investment property or maybe refinancing to get a lower rate,consolidate debts drop PMI or need to cash out to do home improvements. Georgecuartos mortgage Officer of cross country mortgage and Danvers is just a loanofficer you will need as Essex County's top loan officer with more than 8000past happy clients and over 30 years experience George and his team will behappy to assist you with rates the lowest in history Don't hesitate act now youmay be able to save 1000s of dollars call George at 97877746 630 you'relistening to real estate revealed with Dave Seymour from a nice living Boston.


Dave Seymour 16:05

Allright Dave Seymour here. Yeah, you know what's going on Ron pack in the magic,my dear friend Dan Kwok out in the Chicago market, real estate investorcommercial as well as residential stuff. Look, you know where to go. Now if youneed a mortgage locally, you my buddy George Kuh, Sosa boss, TV plse bestrealtor on the North Shore. And when you really want to do some intelligentinvesting and start self directing your retirement accounts, can reach out tomy friends over horizon trust Dan, in March of this year, COVID gave gave theworld a slap, like it's never experienced before, I think it was probably evenworse than the pandemic of the Spanish Flu at the turn of the century. BecauseI don't I don't believe that, you know, global commerce was firing the way thatit is today, you know, in the in the 2020s? What What was your immediateresponse to it all down? What did you see going on? Give me some feedback onyour thoughts? Because I know how smart you are you you do a ton of research,like you really know what's going on financially? What did you see? And what doyou see some of the repercussions of the actions that have happened due to dueto COVID?


Dan Kwak 17:17

Yeah,you know, my initial reaction was, you know, at some point, I knew somethingwas gonna happen, you know, a lot of times when we see markets beingoverinflated, and, you know, we talk about market cycles, usually, one ofthose, one of one of the three things happens, which is, you know, either warbreaks out, or number two, you know, we see some type of correction in themarket, or number three, we see some type of global pandemic, or somethingbigger happening, you know, I mean, even looking at the effects of what 911 hadon the economy, you know, it's, it's, it's kind of one of those things wheresomething happens. So for me, you know, I, I don't want to say I knew this wasgonna happen, because nobody would have predicted what happened with you know,COVID, and the pandemic, but, you know, in 2019, I actually sold all myapartments, because I identified that, you know, our, our dollar was gettingweaker. And you and I talked about this way back, when, you know, we werethrowing out videos about the housing market on my YouTube channel, we weretaught we were already talking about my friend about how the the markets werebeing propped up by you know, use use the word Mickey Mouse money.


Dave Seymour 18:19



Dan Kwak 18:20

thebanking industry, which, by the way, that's the terminology I still use today.You know, I even when my wife tells me, she doesn't want to go anywhere. I waslike, is that a Mickey Mouse excuse, you know,


Dave Seymour 18:30

but Igotta figure out the origin of that. I'm not sure what it is. It's just a partof my vocabulary for years. Well, we'll figure that out later, keep


Dan Kwak 18:37

goingand get that out later. Right. But you know, you and I were, we were alreadytalking to my friend about how the banking industry back, you know, late 2019,you know, was they were being propped up by, you know, big repo markets.


Dave Seymour 18:48

Youknow, they're


Dan Kwak 18:49

they'rebeing pumped up, I'm even now look at looking at the Federal Reserve's balance sheet.You know, you and I, people like me, and you saw a lot of this common. So, youknow, right now, in real estate, you're absolutely right, my friend, it isabsolutely on fire, you know, the median sales price of a single family househas gone up over 15%, year over year, looking at 2019 compared to 2020. As faras I'm concerned, the majority of my tenants are still paying rent. You know,all my single family house, all my single family houses I own, nobody hasmissed rent yet. You know, with the apartments that I still do have a littlebit, you know, I think our collection was around 90%. And for the other 10%,we're doing what we can to help them. But it points towards, again, investingtowards the right thing. You know, I think if you want to talk about somethingthat's being pumped up by Mickey Mouse money right now, man, if you want tolook at the stock market, that's,


Dave Seymour 19:40

Oh, myGod. I know, I know, you have a lot more intelligence than I do in that market.And I say that, you know, just in humility for myself, like I know what I know.And I know what I don't know what we should take on the whole GameStop andTesla and you know, just just the craziness that seems to be going on outthere. Yeah, what's your what's your take on that stuff? Man?


Dan Kwak 20:01

Yeah,you know, it's something that, you know, I think when it happened, we sawhundreds of youtubers make videos on, it's the only thing that people couldtalk about for, you know, hours and hours and hours. But here's what I thinkhere's what I find truly ironic, you know, obviously, we understand what thewhat the hedge funds do with the short squeeze where they'll manipulate certainmarkets and stocks to go down for them to be able to make their money. But inmany ways, who's to say that these guys these Wall Street bet guys who, youknow, the ones, especially in the early process, who say they didn't do thesame thing? Right, they bought GameStop, they told everyone to buy GameStop to,you know, to defeat the hedge funds, and guess what they did? At the peak theysold? Yeah, so in many ways, they did the same thing that the hedge fund doesto their investors, you know, they'll buy something and then, you know, they'lltell everybody to go buy it and manipulate the market for the stock to go up.And then once it's up, they'll sell and they make


Dave Seymour 20:58

anymoney dang cup come out of the market towards your company in your investments.And the reason I asked you that question is because I'm not gonna say there's atsunami of it heading our way, but I'm having a lot and I mean that sincerely alot of high level conversations with smaller institutions, smaller hedge funds,that are just saying we can't we can't play this silliness anymore in thesethese overinflated stocks and, and the way that the market is running, are youseeing some of that yourself?


Dan Kwak 21:27

Yeah, weare. And you know, I mean, I think that's one of the reasons why so many, thecryptocurrency market is the hot is the new kid on the block right now. It'ssuper hot. And in my opinion, you know, Bitcoin and a lot of these cryptocurrencies, they've they've kind of overtaken gold and silver in terms of themainstream commodity that people are relying on. You know, back in the day, youknow, ever since Nixon took the dollar off the gold standard. A lot of peoplesaw gold and silver as kind of a shelter when the stock market in the bondmarket became too volatile. Right, it will go towards more tangible assets. Andthe crypto has kind of taken the place, you know, and yes, you know, silver andgold are still at, historically speaking relatively pretty high places rightnow. But crypto has really taken that place. And one of the things that, youknow, we're communicating to a lot of individuals that we're trying to touch islook, Real Estate's been around for ever since the first caveman rented out thefirst cave to this fellow caveman.


Dave Seymour 22:25



Dan Kwak 22:27

Youknow, and that Imagine if cryptocurrency it was able to pay you cash flow everysingle month, you know,


Dave Seymour 22:34

and giveyou tax benefits


Dan Kwak 22:35

and giveyou tax? Absolutely. And you know, and real estate is guaranteed to increase invalue over time, because, well, you know, they're not making any more land. Youknow, so so people people are like, Oh, you know, we got it, you got to investinvest in crypto, there's only 21 million, you know, bitcoins that's able to bemined, so you can't over inflate it. You can't print more of it like you can withcash. And like, Hey, I'm pretty sure God ain't creating more Earths either.Yeah, no,


Dave Seymour 22:59



Dan Kwak 23:00

We'renot we're not creating more land we're not creating. So, you know, in myopinion, I think it's a it is the perfect time for investors right now to leavethe stock market. And talk to guys like me talk to guys like Dave, and youknow, Dave, you got a lot of really cool projects going on down south. Youknow, I think I think now's the time for people to move into some of theopportunities like, you know, the ones you and I got going on?


Dave Seymour 23:21

Sure,sure. No, no, I'm with you, man. I'm with you. I just it's it's it's sointeresting. I was on. There's a new app out there. And when when you get aniPhone, enjoy the rest of the cool kids, you can come join us. I was on a on adebate stage on on clubhouse, this app that's out there now. And it's it's thisplace is on fire. And I was in a debate stage between a guy by the name ofBruce being a friend of mine. He is just a phenomenal trader. And there was acouple of us real estate guys. And the question was, you know, let's have thedebate of stocks and stocks and day trade in etc versus real estate. And, youknow, the pros and the cons. And it was it was so interesting to have thisdebate because, you know, we talked about liquidity and liquidity, theliquidity of the stock market, Bruce's argument was well, that's a benefit.Well, my argument was is that's a negative, because it's the illiquidity of themarket that allows the scared average investor, the day trader, you know, canopen up any online account, press five or 10 buttons, lose 10,000 or make 200,you know, in a day, and it was just interesting to have that debate because theilliquidity of a commercial real estate investment the world we live in,creates maturity. I think that's a fair statement to make. Would you agree withthat the mature the there's more maturity and commercial real estate investingbecause of its its longevity, like you said,


Dan Kwak 24:52

Oh,yeah, absolutely. You know, if you look at a piece of property, if you give it30 years, it is guaranteed to increase in value but You look at a stock, youknow, 30 years from now that company might not even be around. Yeah, you know, Imean, thinking about individuals who had stock in some of these big companieslike blockbuster or you know, JC Penney 1520 years ago, these guys would havebeen saying, oh, man,


Dave Seymour 25:14

Sears,Sears, Sears and Roebuck dude, who would have thought yeah,


Dan Kwak 25:19

yeah,absolutely. So these guys were held stock. And those, they're, they're saying,oh, man, these companies are never gonna go bankrupt. Well, it's the nature,it's the nature of the beast.


Dave Seymour 25:30

I, I hada really good conversation. And for those of you listening, next week, asurprise to my friends at 104 point nine next week, there is going to be aninterview with with Kevin Harrington, the original shark from Shark Tank. Andone of the things that Kevin said and you'll resonate with this, Dan was, is hesaid his whole challenge throughout his career was always the fact that therewas a bell curve in business because he was in the product world, right? Hesaid, the product or the stock would do really, really well. And it would rise,rise, rise, rise, rise, and then it would plateau. And then it would go backdown again. And his point was is the reason that he partnered with us atfreedom venture investments was because he loved the maturity, the longevityand the ability to create wealth through real estate, because it really has a45 degree angle when you think about it, and the angle is usually going north,not south, you know what I'm saying? So it's not it's not uncommon for folks toget stuck in that Look, man, I don't know about Bitcoin. Dan, I'm not a Bitcoinguy. It makes no sense to me. And I'm I'm kind of like a sticks and bricksfundamental guy. If it doesn't make sense. I don't do it. You know, youunderstand what I'm saying?


Dan Kwak 26:48

No, absolutely.You know, and I've been doing a lot of research on Bitcoin and stocks, just,you know, because I like to learn. But right now, it hasn't, you know, thetechnology because the big thing that a lot of people are making the case ismaking it it's not Bitcoin itself. It's, it's the blockchain technology. And Iunderstand that, you know, it's backed, you know, it's backed by not acommodity, but it's more so backed by a technological system. But it hasn'tshown me that it can be transactional, you know, amongst a global economy.Speaking of tariffs, Kevin Harrington, for that reason with Bitcoin, I'm out.But your Bitcoin right now is in kind of a catch 22 because, you know, if youwant Bitcoin to be considered seriously and you know, Elan musk sent out atweet saying that, you know, he's looking to allow, you know, say he sayssomething along the lines of he's some he's wanting to allow individuals to buyTesla's with Bitcoin or something like that. Well, it's a catch 22 because ifyou allow Bitcoin to be transactional in a global economy, guess what happens?Well, it's got to get centralized, you know, there's got to be regulationattached to it, there's going to be, you know, municipalities and fiscal policythat's going to enter into the picture. And that's inevitable. And whenever youhave something like this be centralized, well, guess what it brings down thevalue of whatever that thing is. So for me, it's, you know, let's see where itgoes. But I'm having a hard time a lot like you, my friend, I'm having a hardtime seeing Bitcoin as more than a commodity currently. But you know, I hopeI'm wrong. Because again, this this isn't something that a lot of people aremoving towards it, because, you know, none of these big hedge fund guys areable to touch it right now.


Dave Seymour 28:28

Youknow, you know what, Dan, here's, here's what I'm thinking while I'm listeningto you. And I love the intelligence of the conversation, because that's I'mlearning, you know, blockchain technology. I don't even know what the heck thatmeans. But it sounds really cool. But here's, here's what I think and listeningto you. I hope all of those things do well. And here's why I don't ever want totear somebody else down, or some other strategy down to build a strategy up. Buthere's what I want to discuss. When we come back from our next little breakhere. I want to discuss the solidity and the confidence of commercial realestate investing. I'm gonna say that, again, the solidity and the confidencethat investors get with commercial real estate investing, because we don't havethe volatility of the market. You're listening to real estate reveal with DaveSeaman, my very good friend, Daniel Kwok. We'll be right back.


Intro Voice Over  29:22

RealEstate revealed We'll be right back.



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


Dave Seymour 29:56

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 mic recognize me from the hit TVshow 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 104point nine to call my team at 781-922-4418.


Intro Voice Over  30:27

Todaythe real estate market is booming mortgage rates just at historic 30 year lows.And the New York Times recently reported that investors are snapping up realestate at rock bottom prices. And now savvy investors are buying real estateusing their IRA that allows them to access their retirement funds to buyproperties without paying any penalties or early withdrawal fees. If you havefunds in your retirement account, and you are interested to learn more callhorizon for us today at 866-712-2007. That's 866-712-2007 unlock the power ofyour retirement account and take advantage of one of the most profoundopportunities in real estate since the housing crisis 15 years ago, callhorizon trust retirement specialist at 866-712-2007. And for a limited time,get our free Ultimate Guide to buying real estate with your IRA that's866-712-2007 or visit horizon slash day. Horizon Trust Company is anindependent passive custodian and it's not associated or affiliated with anddoes not recommend to promote or revise any specific investment investmentopportunity investment sponsor investment company or investment promoter or anyagents employees, representatives or other such firms or entities arising fromthis not providing investment advice, advocating or endorsing real estate.These options may or may not be a fit for individual investors, investments arenot FDIC insured, offer no bank guarantee and may lose value or rising trustdoesn't receive any commissions or fees. If I invest with any other sponsor.You're listening to real estate revealed with Dave see more from Amy's flippingBoston.


Dave Seymour 31:56

Welcomeback. I gotta say you are listening to a couple of geniuses said genius. Geniusis discussing the power of commercial real estate. So then tell me like,pretend I'm in first grade? Why would I want to invest with a guy like you or aguy like me in a commercial real estate asset? What does that look like? Idon't have $20 million to go buy an apartment complex? How can I even getinvolved with something like that?


Dan Kwak 32:29

Sure.Yeah. Well, fortunately, there's guys like me and you who create funds whereyou know, even the little investors can get involved, and they could takeadvantage of what's happening in the commercial real estate market. One of thethings I love about commercial real estate is that it's constantly changing.You know, I'm gonna quote Bruce Lee, you know, because not just because of myrace, but you know, I mean, I grew up watching a lot of kung fu movies, I loveBruce Lee, Bruce Lee said, you know, you got to be like water. And I love realestate, because it's a lot like water, in a sense that, well guess what, if oneaspect of commercial real estate doesn't work, there's always another aspect ofcommercial real estate that always will work. So for example, a lot of peopleare talking about how, you know, the single family housing market is booming,you know, and that the retail is, is, you know, falling to the wayside andoffice space is falling to the wayside that, you know, people are working fromhome, you know, so office space is going to, he's going to go down and down anddown. Well, guess what, you know, that allows them for the Self Storageindustry to elevate because if more people are working from home, they're goingto need more storage, they're going to need more space. So that allows the, theSelf Storage, industry to boom, and self storage office space, they both fallunder the umbrella of commercial real estate. So I know I love it, because evento a first grader, you can explain this but you know, it's it's truly is aninvestment vehicle where the more you learn, the more you can earn.


Dave Seymour 33:56

Oh, saythat again?


Dan Kwak 33:58

Yeah,the more you learn, the more you can earn.


Dave Seymour 34:01

Yeah,baby. You know, what I started to see quite a bit going on is taking some ofthis these larger big box retail assets, and turning them like industrial. AndI've seen quite a few, you know, pro formas ppm pitch decks, come across mydesk. And for those of you listening, what they're doing out there, is theretaking, you know, a mall area or something that's that's just, you know,hemorrhaging money, because of the COVID impact. And what is everybody doing?as Dan says, water flows right? energies flowing, it's always moving. Well,everybody's moved to online retail, right online commerce. Well, you still needthe physical products to you know, to get to your door. So you know, they'retaking these these assets and I'm sure you're seeing some of it too, especiallyin Chicago because you guys have got so much light industrial around that marketplace,where they're just becoming hubs for for moving the packages. You know how manyhow many Amazon vans Have you seen in your neighborhood compared to this timelast year? Oh, yeah. Right. Everybody's now opening up an Amazon you knowdelivery franchise on there on the basil says mighty umbrella. So tell me aboutTell me about residential though. Why do you like residential? Bam? What Why isthat? Why is that your happy place?


Dan Kwak 35:29

Yeah. Soto be more specific, I love commercial residential.


Dave Seymour 35:33

That'swhat I meant. Yeah,


Dan Kwak 35:34

I want asingle family houses and whatnot. It's great. You know, they're awesome, but Ilove you know, I love commercial, residential, and the ancillary strategiesthat go with it. So ancillary meaning, you know, you've got your main apartmentcomplex, but there's a lot of things to support, you know, and can be ancillaryto that strategy, you know, such as, you know, self storage units. And I don'tknow why people don't do this in secondary markets. The strategy is veryprevalent in primary markets where, you know, you have more of a populationdensity, but, you know, why not have an apartment complex in secondary marketswith a dry cleaners, you know, on site, or a coffee shop, or a diner on site?You know, so I love commercial real estate, especially residential, commercialreal estate for that reason, because you're really what you're doing is you'reshaping and you're creating an experience for your customers on a day to daybasis. And allows you to compete, you know, at the end of the day, I love realestate, because, you know, it's one of the three basic human needs, you know,water, food and shelter. So, you know, I know it's never going away, it'salways going to be here. It's an investment where I you know, and that's,that's one of my rules, unless myself 10 years from now will thank me for it. Idon't do it. You know, so I


Dave Seymour 36:48

say thatagain. That was good. Yeah.


Dan Kwak 36:50

Myinvestment philosophy is unless the 10 year older version of me is gonna thankme for it today. I don't do it. So you know, I'm in my late 20s if Daniel inhis late 30s is not happy with my actions right now then, you know, I've gotI've got some things I got to rethink but I love residential commercial realestate man. Well, what about you? You're big into apartments? I know you are.Yeah, honey. D Er, yeah,


Dave Seymour 37:13

jump. Soyeah, Johnny's just had a meeting with Johnny yesterday as CIO Walton, a Vickimet with met with john yesterday, we're taking down a an 81 unit. So we're justgoing through the handoff and what it looks like for jump SRO and his team tojump in. And, you know, part of our vertical is to take over the management ofit, you look it down, I love commercial real estate, apartment house investing,for a multitude of reasons. But the first reason is, is is two words, cashflow, I'll say it again, cash flow. So many investors are out there, including,you know, retirements, 401, K's things of that nature, are out there playingplaying a game that says, you know, I'm banking on cash flow, maybe six months,eight months a year, 18 months down the line, were in times of of discourse,you know, times of challenge. It's a, it's a quarterly distribution, check to aninvestor that keeps them in the bright, right keeps them on course, if youwill, for what it is that we do for them. You know, in commercial real estate,I get cash flow, I get tax benefits through depreciation, you know, the powerof cost segregation, which basically allows me to depreciate fixtures andfittings, inside my apartment complexes. I love being able to give peopledecent, clean, affordable, safe community housing, right. And when I saycommunity, I mean, we create a community. And each one of our assets, I grew upin England's version of the housing projects. And even though we were brokedown, we still had community like we all knew each other, we all kind of liketook care of each other and looked out for each other. So I love that communitypiece. And at the end of the day, it's printing money. Because you know, as youdo with your assets, we do without, we just look for the problems. We look forthe problems in the complex, we fix the problems, we increase the amount ofmoney it brings in, and therefore we increase its value. We don't have to waitfor market cycles to increase value. We're in charge of that. We are nobodyelse and it's tangible. So back to you, brother. I mean, are you are you inagreement young man cuz I think I know


Dan Kwak 39:39

absolutely.Man, you know, the older I get, you know, I still have a long ways to go. But,you know, that's one of the things I'm learning. You know, I think you and Imet we're both we're both aligned in our philosophy. You know, I've got I've gota different type of PPP program. You know, it's not the paint. It's not thepaycheck protection program. It's the people the property and the process.program. Nice. That's that's what we do. You know, we're in the PPP business.You know, that's what we look for people, we solve their problems and we workwith properties.


Dave Seymour 40:10

One ofmy mentors said that Then he said to me, Dave, you're not in real estate,you're in people. And I'm like, What do you mean man, I, you know, I'm inconstruction, I fix stuff, I buy stuff, I shout staff. He goes, Nah, man, hegoes, you're in the people business. He said, If you put people first andprofit second, he said, You'll always win. He said, Don't be greedy. He said,you know, pigs get fat hogs get slaughtered. He said, work the very best dealyou can and create. And it sounds so frickin corny, but it's true. Create WinWin situations for every body involved. You the seller, the seller, the buyer,the investor, the tenant, and then to your point of all the ancillaries. Youknow, we get, we get to put in really good insurance companies, we get to puttogether really good you know, apartment insurance for our for our tenants, youknow, that the services that we supply through, you know, at groundskeeping at theconstruction that we put in the property management that we put in, you know,an apartment complex is a business all on its own, and allows people to earndecent livings and at the same time, take great care of the tenant base. It'ssuch a joy, right to take something broken, fix it and make it more valuable.


Dan Kwak 41:24

Yeah,yeah. And I know that's what you and Johnny are doing right now. You know, youguys are looking at distressed assets. And, you know, you guys are going inthere improving. You're adding value, you know, yeah, that's awesome. Guys. Ilove I love your philosophy. I'm telling you I know I said it before, buteverybody listening You guys gotta check out Dave's company.


Dave Seymour 41:43

I loveyou dad isn't about you, brother, not me, not me. But thank you for that. Thankyou for that, you know, we got a we got a sweet little deal. The 81 actuallythat, that john just met with Walter on and it's it's such a good deal, man.Such a good deal. You know, it's been mismanaged, we're going to take thatover, all in for 7 million and including construction will raise 3 million,we're going to syndicate this one down as a sidecar deal to the fund. But we'reraised 3 million our investors will get you know, targeted 10 14% quarterly distributionson the amount of money that they put in out of that 3 million, we'll do ashorter hold on this one than a two year 3636 months. And then when we sellafter that three year period of time, you know, they participate in the upside75% of the profit goes back to the investor base. And they're looking at youknow, 21 22% IRR internal rate of return on their money. I don't know anywhereelse where you can do that with confidence. If you could, if you could show meI'd love to know where it is. And and check this one out, then the Fed isscreaming at me borrow my money because the interest rates are so freakin lowright now. Yeah, it's that the stars are aligned, where else can you get a loanlike that on a on a on a, you know, a real estate transaction. You know, Ithink this last one's like 3.2% amortized over 20 years. The cost of capital isso cheap, the amount of capital on the sidelines you know, looking for anopportunity is is ridiculous. I'll let you in a little secret we got a we got afriend of Azur is actually going to be down at spring training. He's part ofthe Red Sox organization, he's going to be down there, you know, talking to theguys like doing some presentations down with with the guys it's like there's somuch money looking for somewhere to go with confidence. And you know, yourdeals, my deals, your business model, and business model fits all of thatstuff. Look, before we before we wrap up together. First of all, I know howbusy you are brother and I appreciate your time. But if somebody wants to findyou guys and learn more about what you do and how you do it, what's the bestway for them to touch gloves with the man?


Dan Kwak 43:55

Yeah,you know, I'd say go to our website, the Kwok brothers calm. My last name, kw,AK, you know, just o'clock if you want to check out our YouTubechannel, I know my friend you're about to start a YouTube channel and you'reexcited about it. I need you to help me more but we'll get and I will we'llwe'll do it. You know, I know you just you just let me know my friend and I'llbe ready, you know, but our YouTube channel is the Kwok brothers we talk a lotabout what we talked about today, you know what's happening with the housingmarket? You know, we do a lot of in depth analysis and we have fun. That'sfirst and foremost, we have a lot of fun. So that's where you can find us.Beautiful. All right, one more


Dave Seymour 44:29

thingbefore I let you go. If somebody's thinking about real estate, what's the veryfirst thing that they should do if they want to learn more about investing orbeing an investor in real estate? One quick answer fire away. Yeah,


Dan Kwak 44:42

I'd sayresearch figure out figure out if this is for you. Because this is a game whereif you're not serious about it, you know you're gonna get knocked out. Youknow, this is a pretty serious game. So I always say research, see if there'ssomething that catches your curiosity and if it is great, there's great guyslike myself And Dave, who you know, who have a lot of resources to help youout. And, you know, we got a lot of free stuff on our website. So yeah, that'sprobably the one word I would say.


Dave Seymour 45:09

My linefor that was educate. Don't speculate. Yes, yeah. Dan Kwok. Thanks, brother.We're gonna take a quick break, and I'll be right back. Dan, awesome, bro.Thank you.


Dan Kwak 45:22

Nicedude. I like your picture. Where'd you get that? Where'd you get that laser?


Intro Voice Over  45:30

RealEstate revealed We'll be right back. Thinking of purchasing a new home secondhome or investment property or maybe refinancing to get a lower rate,consolidate debts drop PMI or need to cash out to do home improvements. Georgekudos mortgage Officer of cross country mortgage and Danvers is just a loan officeryou will need as Essex County's top loan officer with more than 8000 past happyclients in over 30 years experience George and his team will be happy to assistyou with rates the lowest in history Don't hesitate act now you may be able tosave 1000s of dollars call George at 97877746 630


Dave Seymour 46:09

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? Well tune in for all the answers on my showreal estate revealed this is they see my might recognize me from the hit TVshow 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 call my team at 781-922-4418. Steve



molestusof Solaris realty has intimate knowledge of the North Shore market with over adecade of experience and record of 300 real estate transactions when it's timeto buy or sell property. Give Steve a call directly at 617-763-1001. That's617-763-1001


Intro Voice Over  47:09

you'relistening to real estate revealed with Dave Seymour from a nice living Boston.


Dave Seymour 47:15

That wasfun, huh? Yeah, you can say it was fun. Yeah, it is. Look, discovery is fun.Discovery is fun. So let's let's unpack this a little bit. There was a lot ofinformation flying around. There may be some of it went over your head, maybesome of it didn't. Maybe you're thinking to yourself, oh my god, you know, mymoney is dying on the vine. I want to share a little something with you. It'spretty pretty, pretty profound article that I came across this week and ittalks about what's called the bond market the junk bond market. First thing tounderstand, is this what it what is a junk bond. So I you know, I'm a smartguy, I did a little research before I bought this discussion to the to theforefront here. And the reason I'm bringing this up is is because the the bondmarket is a place where investors and I'm talking Wall Street has gonetypically for high yield. And a junk bond is a bond that is invested incompanies that are risky companies that you know, have a high potential of notbeing able to pay their bills. So junk bonds represent bonds issued bycompanies that are financially struggling and have a high risk of defaulting ornot paying their interest payments, or repaying the principal to investors.junk bonds are also called this is important lesson, high yield bonds. Forthose of you who don't, and finance yield means return. If somebody says toyou, I'll give you 4% 5% 6% 20% on your money, they're talking about the yieldon capital. So these are called high yield bonds, since the higher yield isneeded to help offset any risk of default. Sorry, if you're taking notes, younow know what a high yield bond or junk bond is, however, Bloomberg put out anarticle and it says us junk bond yields drop below 4% for the first time ever,ever, everywhere that the market and when I say the market, I'm also talkingabout your 401k accounts. I'm talking about other investment. I'm talking aboutthe money that your Certified Financial Planner moves around for you. Themarket has consistently gone to these types of bonds to increase yield. Theother place that they went for yield and consistency and safety was the USbonds t bonds. Well if you pay attention to that they're below 1% right now inyield. So if the high yield the most risky investments in the markets aredropping below 4%. And the safest yield in the market is below 1%. You tell me,are we in trouble? Are you in trouble? I don't know, that's something you'regonna have to answer for yourself. But what I'll throw in there as a littleaddition to that is with the amount of capital that's been printed and dumpedinto our economy. What does that do to inflation? Is inflation higher than 4%?Is it lower than 4%? Is inflation higher than 1%? Is it lower than 1%? I don'tknow. I don't know. You're smart enough to do the research yourself. But what Iwill tell you is this, the odds are pretty good, that inflation will be and isand is continuing to be a Pac Man. What what what, what what, what is it chewsup yield in the marketplace? And what that does is is what you figured youneeded to retire on. The odds are pretty strong right now that that could bechallenged. So that's the doom and gloom, right? Every problem has a solution.Otherwise, it's not a problem. Right? I'll say that, again, every problem has asolution. Otherwise, it's not a problem. So if you perceive it, and youresonate, that it's maybe problem? Well, we believe we have a solution to it.As I said, at the beginning of the episode, today, I run a company calledfreedom venture investments, you can go to the freedom, there,you'll find a lot more information about who we are, what we do and how we canhelp you. Or you can pick up the phone call 781-922-4418. So what do we do?Well, we work with what are called accredited investors and accreditedinvestors determined by the SEC Securities and Exchange Commission, and theysay an accredited investor based on their income and their net worth is smartenough to invest in something which is not in the market. Kind of interesting.If you look at that, it says if you invest in in the market, according to theSEC, you're maybe not as smart as somebody who has a choice to not invest inthe market, I didn't write the rules, I'm just putting the putting the playingfield out there for you to decide what you want to do. So an accreditedinvestor, because of their earning capacity and net worth, can invest inalternative investments, things that are not in the, in the regularmarketplace. accredited investor earns $200,000 a year or more as an individual300,000 as a couple or a family household, or a million dollars in net worthincluding their retirement accounts. So don't discount yourself and say, Oh, Imust be in the in the other category. I don't make enough I don't have enoughat St can help you determine that just with a simple questionnaire and a CPA oran attorney will help you. But if you are an accredited investor, well, youhave options that non accredited investors do not have right now. And theoption that you could consider is investing in commercial real estate assets.Now we have two ways that we help people who want help. first way is through areal estate investment fund. And what we do is is we pull capital, minimuminvestment is $100,000, which isn't a lot of money, you can't retire on it.$100,000 we put that into into the fund, and then the fund part buys commercialassets with all of the aggregated capital from our investment group. What canyou expect for return on that? Well, you can expect the 6% preferred rate ofreturn is 6% higher than the riskiest junk bond yield of 4%. My math is prettygood. Yes. So the preferred 6%, meaning the first 6% of profits is paid to ourinvestors. In quarterly distributions. How do we get quarterly distributionspaid because we have cash flow, I said it again, cash flow rents money comingin every single month from our tenant base, then our investors participate inthe upside after the 6% at a 7525 75% to the investors. So they aggregated ortargeted returns come in at around 10 to 14%. I think that's higher than 4%. Iknow it's better than a than a government bond less than 1%. So 10 to 14%,targeted quarterly distributions, and then they also get to participate becausethe fund liquidates everything in a six year period, we sell everything insidethe fund at the end of six years. All that profit is then split between theinvestors and us as the company and that's also a 75% split as well. So 75% ofall the profits go to a passive investors. I'm gonna say it again passive. Andwhat does that mean? You cannot pick the carpet, you cannot pick the paint. Youcannot receive a phone call from a tenant. I won't lie You, you can't managethe assets out sorry, you're also not allowed to be liable for anything thathappens on the asset. You don't have to go get a loan for the asset, we doeverything for our investors and in return, they get 75% of the profits when wesell everything inside the fund. Now, I R R stands for an internal rate ofreturn. It's a calculation we use in finance, that breaks down the value or thereturn value, the value of the money over the life that it's in the Fund, whichis, like I said, five to six years. Well, that works out to be all of the cashflow. Plus the equity when we sell the IRR is a targeted north of 20% 21 22%.And then finally, we target out what's called an equity multiple. And theequity means the money that an investor puts in, that's their equity into thedeal. Well, everybody wants to know, well, what you know what I get back, wheneverything sells out at the end, the investor gets their $100,000 back, andthen we target additional 120 to 140,000. back. So that's a 2.2 or a 2.4,equitable equity, multiple on the capital going in. So that's what the numberslook like. The question is, is would that be exciting to you? Would it beexciting to reap all the rewards and the tax benefits of owning commercial realestate? That's for you to decide, you know, we talk about this on a weeklybasis. Now, what is this year going to look like for you as an individual? Willit be different than it was last year? I don't know. This is only for peoplewho want it. Which is such a beautiful thing. It's not for everybody. Somepeople are just going to keep on doing what they've been doing. And in return,they're going to keep getting what they've been getting. And I always say to myinvestors on the very first phone call I have with them, I say, Are you happywith your current investments? And if they say no, we unpack that a little bit.And we start looking at some of the solutions to those potential problems goingforward. What are you going to leave for the next generation and the generationafter you? That's a question that I also asked them? Are you looking to reallycreate wealth and long term wealth? And I had a great question this week, and Ihadn't thought about it until this guy actually asked it to me so directly. Hesaid, I'm in, I want to go in the fund. I also want to go in that single dealthat you're doing on the side, the 81 units that I just described to you. Hesaid I want to do that as well. He said, but you know, I feel working my moneylike that. I don't want it back. Can you keep working the money. And I had alittle wry smile. And I said, this is the guy who understands the game. It'sfinding money, which is lazy, earning, earning bad yields, negative yieldsagainst inflation. I said this guy smart, he gets it, he understands the gameof money. And the game of money is getting money out and letting it go to work.Because if you don't work the money, the money ain't gonna work for you. It'sas simple as that. We've had a lot of success, we continue to have a lot ofsuccess. We've attracted the attention of a lot of people in our fun, which isa testimony to our business model. It's also a testimony to the fact that I'mthe CEO of this company and to be able to actually connect with a CEO of a fundlike this is a rarity. But I come from pretty simple background and I neverforgot what it was like to be in fear around capital. And I take a take a personalposition on every investor that comes in with us. So we are approachable, oldschool baby, we get on the phone. This has been real estate reveal. Reach outto us freedom venture calm. And like I said pick up the phone and call me781-922-4418 and if you're in Danvers square, I might even buy you a cup ofcoffee at Kath man go see you next week. God bless.


Intro Voice Over  59:14

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 offer. Any historical performancedata represents past performance past performance does not guarantee futureresults. Tune in again Saturday mornings at 11 for real estate revealed hostedby Dave Seymour, the star of age loving Boston and CEO of freedom ventureinvestments in Denver.