January 9, 2017
Joe Fairless

I just reached over $100,000,000 in apartment communities: Lesson Learned

I recently closed on a 200-unit multifamily deal in Dallas, TX, which puts my company at over $100,000,000 in assets under management (1,438 units). Today, like after many other purchases, I wanted to share a lesson I’ve learned.

I realized that there’s a way to communicate with investors about deals that really resonates. I boiled it down so I could use it during my investor communications moving forward, and so that others can use it during their deals when they are raising private money.

But first, I need to provide some backstory.

What’s your favorite book? Mine is Crucial Conversations. The book explains how to navigate conversations when opinions vary and when the stakes are high. The main solution discussed is to come up with a mutual purpose, and then, build up from there.

What about your favorite book? And what is the central theme? After looking at my bookshelf, I realized most of my favorite non-fiction books have one or, at most, three central themes. Then, the author uses the rest of the book to simply elaborate or add additional context to those themes.

Some examples…

· The 4-Hour Workweek by Tim Ferriss: optimize your time by creating a system for things that you currently do manually

· Investing For Dummies by Eric Tyson: stocks, start-ups and real estate are the three main ways to invest. Pick which path you want to take

· Blink by Malcolm Gladwell: you can make informed decisions in a blink of an eye because of what Gladwell calls “thin-slicing”

So, what does this mean for us as real estate investors? It means that if we can boil down our main talking points into central themes, then we can communicate more effectively and get more transactions closed.

I’ve identified three themes to talk about ANY deal. They are:

1. Market

2. Team

3. Deal

Then, I focus on the top 1 to 2 selling points for each of those categories.

Here is how I applied this during my last deal I closed — the 200-unit in Dallas:


· DFW is home to 25 Fortune 500 headquarters and has been a top growth market in the country for years


· My company currently controls over $70,000,000 in apartment communities in Dallas


· Off-market deal being purchased at 26% below the sales comps

· Projection the same rent premiums on upgraded units that the current owner is achieving

By organizing your conversation talking points with investors into these three themes, it addresses all the relevant aspects of the deal. Of course you’re going to need to elaborate on each of them, but at least you’re making sure you’re covering all your bases and leading with the most important selling points on the deal.

This strategy helped me close on this past deal and I’ll continue to use it moving forward. How you get a lot of value from using it as well!

For further details on this strategy, listen to JF857: How to Communicate Succinctly through Complex Deals and In General #followalongfriday

Disclaimer: The views and opinions expressed in this blog post are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.

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