SWP: 114 Apartment Investing and Creating Community

Eddie Lorin has been in the real estate business for 3 decades now and his achievements have been nothing less than impressive. To date, he has acquired numerous office, apartment, and industrial assets nationwide. While a lot of factors have surely contributed to his success, he credits his ability to create thriving communities to his innate capability to see what most people don’t.

Eddie is also the co-founder of HAPI foundation, a non-profit organization that provides nutrition, education, and sustainable health and fitness programs to families residing in multi-family communities.

His other current venture, Impact Housing REIT also aims to provide not just affordable and quality housing but also fitness, education, nutrition, and health-related programs to families residing in apartment communities.

If you are looking for ways to make a difference in the life of others through your real estate ventures, consider today’s episode a must-listen!

Insight of the Week:

How to add value to people’s lives

Spiritual Foundations:

James 1:2-4

Count it all joy, my brothers, when you meet trials of various kinds, for you know that the testing of your faith produces steadfastness. And let steadfastness have its full effect, that you may be perfect and complete, lacking in nothing.

2 Corinthians 4:8-9

We are afflicted in every way, but not crushed; perplexed, but not driven to despair; persecuted, but not forsaken; struck down, but not destroyed.

In this show, you’ll learn:

  • Eddie’s origin story
  • Where he is right now and the number of units he owns
  • The difference between accredited and non-accredited investors
  • What he means when he says “value add”
  • Ways he adds value to his properties
  • Value add comes in 3 spokes—financial, environmental, and social returns
  • HAPI (Healthy Apartment Property Initiative)
  • Lessons for newbies
  • His goal of helping homeless people
  • Advice for people who invests in multiple areas in terms of organizing and keeping track of it all

Quotes

“Leave enough meat on the bone for your investors.”
“You can be poor but you got to be clean.”
“When people are alone, they tend to do bad things.”
“By changing their environment, you can change their lives.”
“You need to see something someone else doesn’t.”
“You need to do what others don’t do.”
“Everybody in society can either be a winner or a loser.”
“It’s all about your people on the ground.”
“Neglect brings problems regardless of what you’re doing in this world.”
“Just be careful that we don’t push people out.”

Books

Craigslist 
Facebook
Economic Innovation Group

Profile: Eddie Lorin

Impact Housing

Thanks for Listening!

Transcription

Brian: Oh my gosh. I am so excited to be here at our class reunion. Man, I am so pumped. There you go. Oh my gosh, there is Bumblebee Brett. I am going to go talk to Bumblebee Brett. Hey, man. What is going on?

Brett: What is up, Bad Brian?

Brian: Pretty good, pretty good. You still hanging out? Playing Nintendo and stuff, man?

Brett: Well, that is, if you must ask, I graduated from Huntington University. I ran a successful wholesaling business the last ten years. We sold 354 deals last year. Made a lot of money and I have a wonderful beautiful family. How about you? What have you been up to?

Brian: It is nice, man. I am just been hanging out, playing Nintendo. It has been good.

Brett: This is the Simple Wholesaling podcast episode 114.

Welcome to Simple Wholesaling. A Christian podcast that supplies simple, yet effective content for real estate investors and business entrepreneurs. Get advice, tips, and tricks so that you can stay true to your values and achieve your dreams with real estate investing you can trust. Now, introducing your host, Brett Snodgrass.

Brian: Welcome to the Simple Wholesaling podcast guys. I am your co-host, Brian. Excited to be here today, excited to just give you guys some content here. I am with my amazing host, Brett Snodgrass.

Brett: What is going on, Bad Brian?

Brian: Not much man. That is a nice little intro. You boast on yourself, you had become pretty big over there.

Brett: My ego. I do not think my head is going to be able to fit through the door when you walk out here, yes. No, that was funny. I was kind of playing fun of that. But thanks for introducing the show today. This is amazing man. We have been doing this thing with you for what, twenty episodes now?

Brian: Almost, yes.

Brett: It has been great, it has been great. You have been doing an amazing job. If you guys think that Brian has been doing an amazing job as the co-host, please go to iTunes and leave us a review right now and we will read it on the air. We actually have an iTunes for today, I will read that. This iTunes comes from HHarris. It says, ‘Great podcast. Always enjoy the spiritual aspect of it. Very encouraging. Thank you so much. We always enjoy reading the reviews on the air and if you guys are super thrilled of what we are doing, we are always trying to find nuggets and content that we can really relate to all of you, please go to iTunes right now. Leave us a review and read on the air the next episode. Thank you so much for doing that and super appreciate it.

Brian: Yes, I am excited for today’s guest. Really good guest here and this is one of those guests that honestly, Eddie Lorin, I seriously just like sat here and I just wanted to keep listening and listening to him. Yes, like I was like questions here and then, something like that. I was getting entranced by just what he was saying I think.

Brett: Yes, definitely. Eddie has so much knowledge. He has been doing this real estate business for about thirty plus years and he really dives into adding value I think is the biggest nugget that I got from his interview. That he can take whether it is a house or an old 150 unit apartment building and turn it into an amazing place that brings value to the community, brings value to the residents, and he has a foundation called the Happy Foundation where he is really just trying to provide healthy, affordable housing in urban types of communities. He is really doing an amazing job doing that. You are going to want to really stay tuned for the interview with Eddie Lorin.

 

Brett’s Insight of the Week

Now, simple tips and tricks that make real estate investing easier, faster, and better. Brett’s Insight of the Week.

 

Brett: For today’s Insight of the Week, I am really going to piggyback off of what Eddie Lorin talks about in his interview and that is adding value. I feel like that if you are a wholesaler or real estate entrepreneur at all, that is the biggest thing that you can do in your business is how to figure out how are you going to add value to people’s lives. I just wrote down some different things that we do to bring value and you can use these ideas or there is probably a lot that you can use on your own as well. But as a wholesaler, the biggest value that we bring to our investors is to bring them the best deals, to find them the house that the looking for that they can make the numbers work, that they can flip, or they can buy, fix up and rent and build the cash flow. That is the name of the game as a wholesaler, and that is how we add value to our investors.

 

When you are out there wholesaling properties, you have to think about the deals. Also, when you sell the deal, you have to leave enough meat on the bone so that it brings value to your investor and they will keep coming back and buy in more. As a wholesaler, this is not a one hit home brawn where you make a bunch of money just in one deal. This is a volume business, you are going to do a lot of deals. In our intro, talked about how many deals we did last year, we do not really talk numbers that much on this show We did a few hundred deals, do we make a lot of money on each deal? No, it was a volume type of business. We hit base hits three hundred times and that is how we have become successful. Leave enough meat on your bone for your investors.

 

The next thing that you can bring value to is your communities. Eddie talks a lot about bringing value. He takes these old buildings, he fixes them up, he puts in brewery, a hangout spot, a co-working space, a coffee shop, and all these different things to bring people together because people want community, right? As wholesalers or investors, how can you bring value to your communities? I feel like we bring value to the Indianapolis market because we take the deals that are just sitting there, that have the tall grass, that have the boards in the windows that nobody is doing anything with. Yes, we are the wholesalers, we are the middleman, but we can extract those deals and put those deals in the right hands, in the right investor’s hands that they can fix them up, rehab them, flip them, and bring value and increase the values of the community and make a better living environment for the communities. That is what we do as wholesalers.

 

Another thing to really do as an entrepreneur is to be yourself and to be transparent. What are your values, who are you, that is what your business should represent. It should be an extension of yourself. Be transparent, be true to yourself, and be honest with your investors and it is going to pay dividends in the long run.

 

Brian: I want to add on to that real quick. Just as I am dealing with other wholesalers and stuff sometimes ditch that transparency. If you are a wholesaler and that is what you are doing, you are looking to get a property under contract, or even as buy it to sell to somebody else, just let your sellers know that. Do not try to be like, ‘Oh, yes. I am going to buy your property and I am going to do this with it and do that.’ Just be transparent with who you are. Do not try to act like somebody else a little bigger than you are or anything. Be transparent because that always comes through on the deal. It is going to be appreciated by your sellers.

 

Brett: Yes, definitely. Then the last one is be willing to help for free. That can mean a lot of different things. Maybe you are just getting started and you could work with the wholesaling company like ours for free. You could help provide value by doing some admin work, doing some marketing on Craigslist or Facebook, or you could go clean out houses or you could Drive For Dollars around neighborhoods or what can you do to add value to a wholesaling company? Or a company like us, how can we add value for free? Literally, that is why we do this podcast for free. It costs us money to put this on. We have to come up with the material, we get to get the guests, and we do not charge for any of this. We do not have the advertising on here. We literally do this for free. We have a meet up here in Fishers for free.

 

We teach wholesalers how to wholesale, we bring value that way. We have linked up with our local RIA clubs where I am actually on a radio show that is called REAL TALK: Doing Real Estate Investing The Right Way where it is myself, Ron Watson, and Dave Short and I do that for free. It is just, again, bringing value to investors in the community. What can you do for free? Can you bring education, can you bring deals to wholesalers more experienced than yourself? Can you do some of the sweat equity work that really brings a value to a company? That really helps you learn the game. Take these value adds and add them to your business and hope that helps you guys out today.

 

Spiritual Foundation

Do you dream of a life that is purpose-driven and makes a difference? Spiritual Foundations.

 

Brett: On today’s Spiritual Foundations, we are going to really go to some scripture in the Bible and if you are just tuning into our show, we are a Christian podcast, and that is why we do this section of the show. Be all the glory to God for what we are doing. We are all going to go to the same place on this earth, at least. This world is temporary, our lives are temporary, but it can be permanent and that is eternity with Jesus in heaven and that is why we talk about this show because without him that we are basically nothing, none of it really matters.

 

We are going to go to the scripture of James 1: 2- and 2 Corinthians 4:8-9. We have been going through some challenges this year. Have you guys ever gone through just some serious challenges that you might get discouraged, you might lose faith, you worry about the outcome and you have read books about 90% of the things that you worry about never come true?

 

I am kind of a worrier sometimes and when things come at me like my integrity or someone is talking about me and persecuting me of who I am, that I get discouraged. That is when I go to God the most and he brings me strength and brings me that courage back. We are not going to dive in a lot into this but there has been some things happening here in Indianapolis that some things have imploded. There has been some people, some companies, that we sold properties to that I did not really know what was happening on on the back end.

 

We buy properties, our names are on title, we do whole thing a little bit different where we take the properties down, our name is on the title, and then we sell the properties. A lot of times we will have investors come, they offer us cash, they buy the properties for cash and then after that they fix up, they rent them, they do whatever they want with the properties and we are kind of hands off. We do not know sometimes who they sell the properties to, we do not know what happens after that. A lot of times we do because they will send us back, ‘Hey, this is a really successful house. Thank you so much. I want another one.’ A lot of times we do not really know. Sometimes people do amazing things to the houses and they fix them up and it is amazing.

 

They help out the communities. Then other times, someone might not do some amazing things to the property. They might sell to someone and then maybe just not do the right thing. Us as a company at Simple Wholesaling, we were trying to do the right thing. Treat people how we want to be treated, glory to God, and just always move in that direction. That is why we have our core values. But one person told me one time that if you are in the real estate game long enough, you are going to have obstacles, you are going to have challenges. Things are going to happen out of your control. You are going to be in the courtroom, people are going to talk about you in a bad light. Some things have gone on like that within our organization because the more popular you get, the bigger that you are, people kind of puts a bull’s eye on your back and people want to take you down.

 

That is kind of what has been happening so I really wanted to hit home with these verses and I want to really stick to this because this is exactly what the Bible talks about. We are putting our self out there as a Christian company, trying to do the right thing, and that kind of puts a bull’s eye on us a little bit. In 2 Corinthians 4:8-9, it says, ‘We are afflicted in every way but not crushed. We are perplexed but not driven to despair. We are persecuted but not forsaken. We are struck down but not destroyed.’ I want to talk about James 1:2-4. ‘It says count it all joy my brothers when you meet trials of various kinds for you know that the testing of your faith produces steadfastness and steadfastness have its full effect. That you may be perfect and complete, lacking in nothing.’

 

What these verses truly means to me is the Bible says that we are going to have obstacles, challenges. We are going to be afflicted, we are going to persecutd, but God is with us every step of the way. That we cannot be destroyed, that we cannot live a life of despair because you can take it all away. You can take away my money, you can take away my business, you can even take away my reputation amongst the people, you can take away my family, you can take anything and everything away that I have in this world but you cannot take away one thing and you cannot take away Jesus Christ in my life leading me every step of the way. That I could be absolutely alone, no clothes, living out of a box, and my heart is still full of joy because I have Christ.

 

He is the only permanent thing and I have hope in eternity. That is what I have been clinging to each day. Whatever you guys are going through, trials, challenges, maybe you are being persecuted for your faith, maybe you are being persecuted for something else that you did not really do. Cling on to these verses, cling on to the Word of God, the only thing that is permanent in your life. I just want to remind you that today. This is a great reminder from me.

 

Interview

 

Brett: Today, we are interviewing Eddie Lorin. Eddie has had a thirty year career in the real estate investing space and he has been responsible for the acquisition of more than 3.7 billion dollars in the office, industrial and apartment community assets nationwide. Since 2001, he has successfully purchased and transformed more than three billion dollars worth of multifamily real-estate acting as either a principal or an adviser, amounting to more than one hundred eighty thriving communities with approximately forty thousand apartment units nationwide. This interview is very very impactful. If you are interested in adding value…

 

If you are a wholesaler out there and you think I may not get anything from this interview, I am going to tell you that that is false because the thing that he talks about more than anything is adding value and that is what you can get from this interview. He takes these old apartment buildings and turns them into the valuable valuable assets and he breaks it down in such a way that it just sounds so simple. Let us get right now to the interview with Eddie Lorin. Hey, Eddie. How is it going?

 

Eddie: Great. How are you? Good to be here.

 

Brett: Yes, we are super excited. Brian and I just been talking about this episode and everything that you are doing and really gaining all of your wisdom, all the years you have been doing this business and super stoked to have you on the show today.

 

Brian: Yes, we are excited to have you, Eddie. I know you have been investing for I think looks like thirty years or something like that. Let us go ahead and just jump in. Why don’t you just tell us a little bit about how you got started? What is kind of your origin story?

 

Eddie: Well, I grew up of modest means. I lost my father when I was ten months and my mother when I was seventeen. Put my way through UCLA and not really had a lot of dough and the mantra of you can be poor but you got to be clean. I always took that to heart and when I got into real estate, I wanted to provide clean, safe, affordable communities for people like I had when I was a kid. It was full of love but not a lot of money. That was the genesis of this value add strategy. Never really built new product, it has always been very different type of a business model. More focused on older product and kind of shining it up and making it affordable and clean and nice.

 

Brian: Nice. Did you know that you wanted to get into real estate investing as you are going through UCLA or is that just something that just kind of came about.

 

Eddie: Well, I was a psych major and I thought about what is the next step because being a psych major might kind of is so general. You think about everything, everything you do is psychological. Just as time went on, I watched how buildings… I just kind of love buildings and I love to be able to see what I could do and be creative in it. It is all about the vision so I ended that vision to transform things and paint fassads, paint schemes, etc. It kind of evolved. I did not start in apartments.

 

I started in office leasing and that was not that fun. Then I moved on to development of industrial and retail and just kind of settled in on apartments and said you know what this is a cool way to do things because they are only one year leases. All the commercial properties are five or ten year leases. Kind of get caught in cycles, it is a little easier to be nimble and small in the apartment game because of the one year leases.

 

Brett: Yes, definitely. Let us dive into that a little bit. We have not had a lot of commercial real estate investors on the show. We talked to a lot of flippers, a lot of wholesalers. I really want to dive into… You talk about the one year leases because a lot times people think that hey if I can lease out to a retail store that being in a five year lease or ten year lease, that means more security. You are talking about you like the residential apartment for the one year leases. Talk about that little bit and why do you like that better?

 

Eddie: Well, look, there is no free lunch. It is a lot more work to be handling all these turnovers and renovations. There is a good to all and bad to all. For me, just being an individual and not an institution, it is easier to be more nimble I think and you can react better. Let us say you have retail, you have got a ten year lease and all of a sudden they go dark. They may still be paying rent but it affects all your other retailers.

 

Even if they do not leave and stick you with the rent. If they stay in, then you have got a real problem with synergy community and a lot. It is just a different business. It more complicated and more institutional and more expensive. Tenants improvements and leasing commissions are huge upfront. Ten year lease, you could be spending our million dollars just by the tenant to get them in there. You need real deep pockets and a real different capital structure.

 

Brett: Yes, definitely. I think that if the tenant goes dark like you said, or leaves, it is probably a lot harder to rent that unlike residential housing. A lot of people are looking for that. It is not a special type of lease. Definitely.

 

Brian: Yes. Eddie, can you tell our audience just a little bit about kind of what you are doing right now? Like what markets you are in? Where you are investing and just like maybe how many units you have?

 

Eddie: Yes. We are up to about 6000 units. I have been as high as 15000 and as low as obviously zero when I started the new company. You fluctuate based on markets, based on new investors. The latest venture is impacthousing.com. It is a crowd funded reap. An opportunity to give non-accredited investors, instead of just accredited ones which is what we have traditionally worked with, the opportunity to come in and get a piece of our real estate offering where it was never possible before. Currently, we are investing in the beltway of Maryland and DC. It is my opinion, and it is just an opinion, that Amazon is going to end up there.

 

You will have fifty, 50, thousands coming to that region and I think that is a very compelling case and there is not going to be enough housing to take care of the people. That is one of the markets we are focused on and we are here in California are creating some affordable housing. We are in Nevada, Texas. Love Dallas and those areas, Colorado Springs and Florida are the primary markets that we are playing in today.

 

Brett: That is a lot of units there, Eddie. Six thousand units, that is amazing.

 

Eddie: We had 25000 units though.

 

Brett: Wow, that is awesome. Talk to us about impacthousing.com. You said non-accredited versus accredited investors and crowdfunding. You are probably talking above the heads on some of our listeners. What is crowdfunding and what is accredited versus not accredited takes into that?

 

Eddie: Okay. Accredited investors are those that make 200,000 a year and have a net worth of a million dollars. Used to be securities laws for eighty years were stuck and that only accredited investors, wealthy people could invest in offerings like ours. In 2012, the Obama administration introduced the job’s act and what it has done is democratized the opportunity for everyone and anyone regardless of income level or wealth to invest directly in real estate offerings.

Non-accredited investors can invest as little as a thousand dollars in our opportunity and get a piece of the same shares that someone who is accredited. It has revolutionized the investing industry, it is slowly gaining steam, exponentially growing whereas people can go direct through the internet which is what crowdfunding is, kind of like Kickstarter, and you can avoid them Wall Street middleman and all the other load and fees and come direct to us. A millennial generation is a lot more interested in investing online that let us say the Baby Boomers. What is going to happen is about 42 trillion dollars are going to transfer between the baby boomers to the millennial generation. This is the way of the future of investing. Direct, efficient investment. It is really amazing that the government allows everyone, instead of the wealthy, to participate.

 

Brett: Do you think that it is revolutionizing the real estate industry as a whole? Kind of like when the online companies came out to basically trade stocks where it used to be? You had to go through a broker, pay some high fees, and then some of the other online coming like e-trade and some of those came out. Do you think it is like that? Is that kind of what is happening and this is obviously a whole new way to buy real estate as well. Someone can actually own a piece of real estate without having to buy the whole house. Do you think this is going to keep continuing to grow? What do you guys are seeing on them?

 

Eddie: Yes, absolutely. History has shown that in the last, since 2012, since the Jobs Act, it has almost doubled every year and granted it is still a small sector, maybe 3% or 4% of the investing market is online but it is going to change dramatically as they say crosses the chasm or hits the mainstream. It is still not there yet but it is percolating.

 

Brett: Yes.

 

Brian: What type of a return on investment would maybe an non-accredited investor be looking at right there for that?

 

Eddie: Well, all I can tell you is that the SEC is very cautious when they approve someone like our offering. I cannot project returns, I can only point people to the website and tell you that our past returns have averaged the 9% cash and cash return on a gross basis and as high as a 24% IRR. What is an IRR? That is the average annual return over five years. People can look for or hope to get, similar to our past performance, over two times their money back. Putting in theoretically a hundred thousand, getting back two hundred thousand.

 

Brett: Wow, awesome, awesome. Well, you talked about a term that I hear a lot but some of our listeners might not be familiar with and that is adding value or value add. You are saying like that is really an important concept when you are talking about commercial or multifamily or even residential. What does that exactly mean and what are some ways that you add value to your properties?

 

Eddie: Let us take this high-rise in Maryland for an example. We are purchasing the property. There is a 143 units, twelve stories, it is owned by an institution and it is very neglected. The hallways are crappy using in canvas and inefficient lighting, the toilets are not set properly so they are wasting a lot of water. There is a vacant warehouse or the equivalent of the ground floor that used to be some kind of storage locker and now it is not even utilized. Imagine you have a 143 units, let us say you got four or five hundred people dwelling under your roofs, you have an opportunity to really give them a great experience in their lives right where they live. What we are going to do is deliver investors a triple bottom line. What is a triple bottom line? Of course you got to give a financial return but the environmental return is saving water, saving electricity which also by the way you can either raise rents or lower expenses, it is all the same effect.

 

We are going to lower expenses on me on that side and then it is a social return. We are creating housing that is affordable, we are not going to rent anybody who makes more than 80% of the area median income. Area median income is the average income for the area. If someone makes $35000 and the area median income is $50000, they would qualify because they are making less than 80% or $40000. That is a really important thing. We have a housing crisis in this country and we are doing our best to help solve it by buying older product, rehabbing it, putting in a value add, and deeming it affordable. That is a really great value add.

 

The value added comes in three spokes: financial, environmental and social returns. To the investor, our goal is a happy resident. A happy resident stays, pays, and refers their friends and we create a sense of community. We also have a non-profit called HAPI, Healthy Apartment Property Initiative. What we do is we provide health and wellness programming directly at the doorstep to where people live. That big warehouse I told you about, we are going to spend a couple $100000 and make it a state of the art fitness center, social area, sports bar, internet cafe and general hang out for people who work at home and they can kind of a work share space kind of that concept.

 

As a result, people can really have a sense of community and go down and hang out with their friends and get work done and that is a true value add because right now it is just a neglected apartment building where nobody knows each other and let us not forget that social isolation is tend to amount to smoking, studies have shown. If people are alone, they will tend to do bad things. If you give them a sense of community and respect, it tends to helps society overall. By changing their environment, you change their lives.

 

Brian: Man, that is awesome. I mean that is really cool just hear you talk about it and just… It just really needs to see. I know we see a lot of that here in Indianapolis of just kind of bringing that community together so it is really cool to hear you talk about just that sense of community when you are building, when you are investing in these complexes. It is really cool. Can you do me a favor? Just like kind of talk about, maybe a lot of our listeners are they are looking to just get into the game, maybe they are looking to wholesale or looking for a single family residence to flip or invest and some of them are looking to invest in apartment complexes, looking to get that game, what are some of maybe some of the best lessons that you can like kind of pass on to a newbie?

 

Eddie: Well, the most important thing is you need to see something someone else does not. You see a house, you see how you can change the landscape, change the approach, change the driveway. Like my niece bought a house and their steps built into the driveway. I mean nothing could be more annoying than trying to go up your driveway you are, you know, that kind of thing. Most people would run for the hills, you run to it because you see what others do not. You fill in those steps and make it a smooth beautiful driveway. Maybe even lay with some rock so it is attractive and beautiful landscaping. You need to do what others do not do and that is the true essence of creating value. It is very simple, most people do not have vision. They cannot foresee what something could be, they only see what it is, and to me that is the most important thing.

 

Brian: When did you kind of realize that you maybe had that gift of like hey, I kind of have something here. I have this idea that I do kind of see… I can see this vision, I can see this for what it is or what it can be and I just want to run with it. Where did you kind of come into that?

Eddie: That is a great question. Just it is innate. You just see something and say that looks like you know what. I could do something on that roof line or like we have apartment buildings that will buy are old and they are just monoliths, if you know what I mean, they are just one color. It is like wait, we could put what we call a belly band or a piece of foam and cut that property in half.

 

Let us say it is a two story building, above the first window line and the second window line, we put a strip. We paint that a color and then we put two tone between the top and the bottom so it gives its contrast and it stands out. We also really focus on signage. We want someone to see our sign and say, ‘I only wish I could afford to live there. That looks really cool.’ We have signs that we had one called The Beach Club and then we have one that kind of looked like a Corona bottle. You know that Corona commercial?

 

Brett: Yes.

 

Eddie: Another one we call legends on lakes and we had actual, out of metal, we made a sailboat that was cut out above the sign. It is eye catching, its cool. You take that same feel and color scheme into your brochures inside, on to your website, you make the colors of the building blend with the sign, and everything needs to work together to create that inviting feeling sense of community. We do state of the art fitness centers as I mentioned, resort-style pools like in Vegas. We do all these things that make people want to hang.

 

Brett: Yes.

 

Brian: I kind of want to live in one of these complexes.

 

Brett: I know. I want to go right now. It is funny how the world and just our culture is changing so much and just when you are talking about creating a warm environment for communities to get together with technology and everything, that is one thing that we really lack. It is amazing that you are creating that, it is what we all want but we are kind of getting away from that, right? The communication and just hanging out with our friends and all that because of all the social media and technology out there. That is really awesome, Eddie, and thank you so much for adding value to housing and that is cool. I love your foundation, HAPI, and do you have any other projects that you guys are doing that you can tell us a little bit about? I love to hear stories that maybe your foundation has been doing?

 

Eddie: Sure. I am not really making much money out of this but I feel like I want to be part of the solution here in Los Angeles where I live. We are buying an old property and we are deeming it affordable to support of housing for the homeless. There is a concept called NIMBY, not in my backyard, where a lot of people do not want. They want to get rid of the homeless but they do not want anything built around them. Nothing is getting built and the only way to house these people is to buy existing older products, kind of what I have done all along, and deem it affordable.

 

We are buying these fifty units and we are going to have this with our foundation, we are going to supply every vacancy and make it affordable. We got a property tax abatement as a quid pro quo from the city and we will have a nonprofit that does supportive housing and social work and watches over their meds and their transitional people that are going to live in these studios at once and they will be able to have a place to start their lives again because the homeless population you read about it says 50000 people in Los Angeles. But it swells to a 150000 because some people either have one foot on a banana peel or they end up homeless for a month or two months but they go in on and off the rolls.

 

The problems is even worse than you would think and probably 20% I would guess are mentally ill and really need to be put in an area that is… They are talking to themselves, we have all seen them and they are taking be it bowel movements on the streets. I mean they are not mentally sane and that is the problem, our government is not taking care of them. There is no one else to take care of them but there is that 80% who have lost their jobs, who have lost their way, and they deserve a place to live and a head start. We are trying to create this housing out of existing product and at least do our share to make it so that people can have a place to set up and get back on their feet.

 

They need some vouchers and they need some help because where in a capitalist society it is all great, I do not want to sound like a too liberal here and I know you guys are Midwestern guys, but I am telling you that everybody in society can either be a winner or loser. If you want to be in capitalism, you have to own up to the fact that they are going to be losers in this world and you have to take care of the losers in my opinion so I am doing my part.

 

Brett: Yes. I mean that is definitely is a huge problem. Obviously that is an issue here and it is one of those things where you can look at and talk about but then nobody really wants to do anything about it because it is a lot of work and there is probably not much money in it and we are out living our lives. That is awesome what you are doing.

 

Eddie: Than you. The fact that there is no money in it, you cannot argue with the government doing it. Who else is going to do it?

 

Brett: Right. Yes, definitely.

 

Brian: I just have one more question for you. I feel like we are already in the going deep section but I have one more question for you here before we roll into that. I know you invest in multiple states and just kind of have complexes all over the nation and stuff, can you give any advice for somebody that is investing in multiple states or multiple areas or just kind of what is the best way to kind of just organize all that stuff and just keep track of it?

 

Eddie: It is all about your people on the ground. I can only do what I do because I have done it for so long and I have relationships for ten, twenty years, that are management people that they can finish my sentences. Before you go outside of your own realm, you really need to learn the business and do things locally. I just happen to be in a position where I can do it but it is really about the relationship of like manager who is dealing with your tenants every day and more important is that maintenance guy. He is the first line of defense because the manager is only there when there is a problem. The maintenance guy is there every day because the manager should be walking the property but they do not as much.

 

That is what is pretty interesting is that people forget about that maintenance guy. He is the guy who is fixing the toilet, fixing the common area, and he needs to smile and he needs to be aware of what is going on so problems do not percolate and become exacerbated. It is really a just about elbow grease and staying on top of things. Neglect brings problems regardless of what you are doing in this will world. As long as you are on top of things, you are all right. But it is harder to do it from a far unless you have the right people on the ground. People starting out should not try that. Do not try this at home kids, right?

 

Brett: That is right, that is right. Yes, definitely. It is a people business, it is a relationship business, and even if you do it locally, having the right team in your business. If you are doing it not locally, then just find those right people to have on the ground whether it is the maintenance guy or the manager and just kind of stick into those values, treating people how you want to be treated. We are going to transition into the part of the show that Brian and I like to call Going Deep.

 

Brian: Going Deep.

 

Going Deep

 

Brett: In this section, Eddie, we just like to talk about your life and obviously we have been kind of diving into your foundation and you are doing so many amazing things for communities all over the nation. We really want to just dive into your purpose and you have been doing this for a while and you are continuing to do it when some people might be laying on a beach somewhere or whatever but you are continually put in hard work, put in the elbow grease, and to run a business and to help with your foundation and all that. Let us really dig into why, why are you continuing to do that and I know it is not easy, it is a lot of work isn’t it? Kind of take us into the purpose behind all that.

 

Eddie: Well, I tend to surround myself with a lot of young people and I like to teach and mentor and the energy is infectious and so that is part of why I do it. I think that the next generation needs to do more to help society. This is my mission, it is to make sure not only the people in this generation are able to contribute and make a difference. But or important, I get a joy out of taking old and neglected product and making a thriving community out of it. It just makes me happy. There is so much blight, I always like to say we take blight and make light. That is the joy and that is why we do what we do. We cannot focus only on the money, we have to focus on the purpose and what you say is so important, the why?

 

Everybody needs to know why we get up out of bed every day? Otherwise you could be sitting on the beach but where is the meaning in that? That is what we have to keep perspective on. Look, it is very challenging, it is frustrating, it is a very competitive society and everybody is out to take from you and it is a dog eat dog world and all those things that capitalism brings which I am a capitalist. I am embrace it but I also understand that it is not for everyone and a lot of people can just give up and we need to help them. There is no crime in helping the other and that is really a problem. Now, I am Jewish, I have been taking this class called Musar which is basically character traits. There are eighteen of them.

 

Things like equanimity and calmness and frugality and respect and all these things and we study them because they are really important. That we can control ourselves and focus more on the other because we really get more joy out of the giving even though we think the taking is what it is about. There is a lot of takers in the world, I deal with them every day. You just kind of just say that is their problem and not get caught up in it, not take things personally, and these are all easier said than done, that is what we have to study and have discipline and stay present and mindful and all those wonderful things and that is I guess what happens when you get in your fifty’s and you get to be an old guy like me. Start to think about what is it that makes me tick why do I do what I do and I just do not want to deal with people that are not good people and that is the joy and the luxury of getting older I guess but otherwise much nicer to be you.

 

Brett: That is true, that is true. I have always tried to teach my kids about the giving. There is so much more joy in the giving and it is a great reminder for me and just to know that because I feel like we have to be intentional about that because sometimes our human nature, we get away from that, takes us back to any more or about me and we get to think about the internal rather the external sometimes. Thank you for sharing that.

 

Brian: Definitely. Eddie, let us talk about that.

 

Eddie: I just said was that deep enough?

 

Brett: Yes, that was really deep, Eddie. Thank you.

 

Brian: Let us talk about that intentionality a little bit though. I know you seem like you are very intentional about all these different projects the you have been doing and you have so many things going on. What is kind of next on the horizon for you?

 

Eddie: Well, I got enough on my plate right now. I just want to execute on my ideas I have and there are a lot of them. I am probably pursuing five to six different initiatives and each of these initiatives are basically the same thing, providing clean, safe, affordable housing, treating people with respect. That is the common themes. That is how I can keep track of it all but there are different ways to execute.

 

There is something called opportunity zones that just came out of this new tax act which is very exciting. It is the opportunity to invest in low income communities that have been designated and so there is tax savings for people to an incentive for people who sell their stocks and real estate and invest in low income communities that have been designated by each governor and that is the next wave of gentrification that is going to happen. We just have to be careful as proper stewards of capital to make sure that we do not push out the very people we are trying to help, right? There is always the Yin and the Yang of everything but the new law is fantastic. Centralizing people to invest, you just got to, like I said, be careful that we do not push people out because that is a problem.

 

Brett: Where can you find some of that because I know the new tax laws of 2018 and then we talked…

 

Eddie: EIG.org is the nonprofit that set up to administer this concept, eig.org.

 

Brett: Okay.

 

Eddie: Think, people like us are going to develop these funds to invest in low income communities and low income housing, new businesses, etc., it is really a great concept.

 

Brett: Yes, that is really great and you guys we are going to put that in the show notes at the simplewholesaling.com/episode114. So much great information, Eddie. You are doing so many amazing things, you are helping communities, you are helping the homeless, and such a joy to have you on the show today.

 

Touch of Randomness

It is time for a Touch of Randomness.

 

Brett: We just like to end on a little of a lighter note. We went to our interview and we into our deep section and then now we are going to just ask you a couple of questions, random questions and just kind of name the first thing that comes to your mind. Eddie, what do you think the greatest invention has been?

 

Eddie: The cell phone.

 

Brett: Okay. Yes.

 

Brian: I would always figured. I got one more question for you here. Let us say, Eddie, you were at a rodeo. Where would you rather be? Would you rather be in the stand watching? Would you rather be the one riding the bull or like the rodeo clown?

 

Eddie: Probably the clown.

 

Brian: I like it, I like it.

 

Brett: That is awesome. Well, that was just a couple questions for you, Eddie. Thanks for participating in that.

 

Eddie: I remember being in geometry in high school. I got up and imitated this guy, name is Mr. Casen, instead of ABCD on each triangle or each quadrant of the rectangle, he goes ‘evil banker Charlie dog’ and then we look at these different components and I got up in front of the class and I actually imitated the guy. He thought it was funny, I thought he would slap me. He laughed more than the damn kid.

 

Brett: Oh man, that is awesome. That is so cool. Well, Eddie, thank you so much for joining us on the show today. We appreciate you taking time out of your busy schedule. I know you got much on your plate but if someone wants to reach out to you, where is the best place for them to go?

 

Eddie: Find me at impacthousing.com or you can Google my name, Lorin is last name, first name Eddie. There is plenty of stuff there, more than I can imagine I think.

 

Brett: Sounds good. Well, check that out guys on our show notes at simplewholesaling.com/episode114. This is the wrap, interview with Eddie Lorin. We thank you so much, Eddie and we wish you so much success in the future man.

 

Brian: Thanks, Eddie.

 

Eddie: Back at you, back at you. Good luck to you.

 

Brett: Thanks.

 

Thank you for listening to Simple Wholesaling. If you enjoyed today’s show, please head over to iTunes, give us a rating and leave a review. Be sure to pick up a copy of our free e-book, This Simple Wholesaling System, by joining our community over at www.SimpleWholesaling.com/OurDashSystem.

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