Brent Barcus is a Partner at i65Capital Investments, where he partners with highly vetted multifamily operators, focusing on capital raising and sourcing deals. He is also an audio producer and sound designer. In this episode, Brent discusses how he is using multifamily investing to build generational wealth, what skills he had to sharpen to make the leap into commercial real estate, and how he rebranded himself from his original career in the music industry to succeed as a real estate investor.
Brent Barcus | Real Estate Background
- Partner at i65Capital Investments
- Portfolio:
- Co-GP of 200 units in GA
- Based in: Nashville, TN
- Say hi to him at:
- Best Ever Book: Multifamily Investors Who Dominate by Beau Beery
- Greatest Lesson: This industry is all about who you know. Your network and relationships drive everything.
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TRANSCRIPT
Slocomb Reed: Best Ever listeners, welcome to the best real estate investing advice ever show. I'm Slocomb Reed, and I'm here with Brent Barcus. Brent is joining us from Nashville, Tennessee. His company is I65 Capital Investments. They focus on partnering with multifamily operators, they do capital raising and deal sourcing within Nashville. Currently, Brent is a co-GP on a 200 unit property in Georgia. As well as multifamily syndications, he's an immersive audio producer, a mix engineer and sound designer with some pretty big-name clients. Brent, could you give us a little bit more about your background and what you're currently focused on?
Brent Barcus: Yes, thank you so much for having me. It's an honor to be here. Gosh, let's see, the quick story of my background - I grew up in Missouri, St. Louis, and fell in love with music at a young age. I decided to give Nashville a shot out of high school, so I moved down here with a dream, and studied music in college for a little while... And this was in the early '90s. I'm dating myself now, showing my age... But anyway, I love Nashville, and I ended up getting into the music scene originally as a guitar player, as a session touring musician for a session player, sideman to the stars, if you will, playing with different artists... And I found my way in studios, producing music, found my way to LA for a few years, back to Nashville now, raising family... So I've always had studio, and then got into working with brands and networks, film and TV, and do sound design and mixing in that space now. But I always just had a love for real estate.
I grew up with a dad in commercial real estate in Missouri who was a broker, developer, deal-maker, and I was inspired, I think it was in my blood from birth. So I've always loved real estate, and have been in residential for many years, and then found a new love in multifamily, I'd say four or five years ago, and just started engrossing myself in the background, the history and everything that kind of pertains to multifamily. And that's where I'm at now.
Slocomb Reed: Apartment syndication specifically is relatively new for you, it sounds like. What were you doing in real estate before that?
Brent Barcus: Before that - my wife is actually a real estate agent. So we've always been in and out of the single family. We've done short-term rentals, we've done fix and flips. We actually built a spec home in Nashville from ground up... So we've kind of played around in that space. It's always been a creative thing for us, being creative in the music and audio world. I've always seen real estate as a creative, fun investment opportunity... Until a few years ago, I'm getting a little older, I started thinking about "How do I not make this another job?", that already had in music and audio. It's like "What can I do in real estate that wouldn't be a one-off?" So I kind of started reading about multifamily, and I just kind of bonded with it, I guess, honestly; that it's something that I could still do in real estate, and grow and scale in it, learn something new, a new vertical, and hopefully, obviously build investment assets that I can hopefully pass down to my kids.
Slocomb Reed: What led to the transition into larger deals, and partnering with operators here recently?
Brent Barcus: Yeah, I think once I started going to more events - I'm such a believer in being around those that have more experience and are highly successful in what they're doing. So the opportunity to go and ingrain myself in listening to other deals sponsors that have been doing this for years, and have 10,000 or plus units - it just really got me thinking I want to be a part of a team, I want to work with others that are excellent at what they do, and how can I provide value in that. So that's kind of got me excited about being a part of bringing deals and capital into these other deals that are scalable, larger and the operation side - a lot of it is taken care of with property management. It's not me having to deal with all the weekly and daily maintenance and all those things that are happening with short-term and single family rentals.
Slocomb Reed: Yeah, I got out of operating short-term rentals December 31st, 2021. I own one now, and love having someone else manage it for me, for sure. I resonate with that, for sure.
Brent Barcus: Yeah.
Slocomb Reed: Brent, this is a personal question coming from me, which our listeners will hopefully gain value from... But help me jump a mental hurdle here. I'm an apartment owner-operator in Cincinnati, and I'm not doing 200 unit deals right now, and I'm not involved in the value-add business plan where I have a targeted hold period, with the sale at the end, in part because of something you already said, that you got into real estate to be building wealth for your Family. How does that sentiment specifically of building generational wealth translate for you into commercial real estate? What is it about the commercial real estate deals that you're seeing that resonates with your desire for generational wealth in your family?
Brent Barcus: That's a great question. I think it's a combination of real assets - obviously, in the past, I put my money in the markets and things that I had no control over what was going on with, obviously... So I think it's knowing real estate from my background; I do believe in putting my money into things that I can actually go, see, feel and touch. And I like, obviously, the size of it, and I love the general partnership side, just because I think being a part of the operation and providing value in my skill set, whether it's helping out with overseeing property management, or just bringing capital into the deal, or sourcing the deal and bringing it to other operators that I have full faith in - like being hands-on to that point, depending on the hold times, whether it's 5, 10 years, or longer, depending on the asset, if it's a class A opportunity - I just know that that's where I want to spend the rest of my living years, I guess. I've invested in those quality assets, and knowing that then that cash flow, that percentage of ownership can be then passed down to hopefully my children's children. That is my goal.
Slocomb Reed: Brent, what was your largest property before you got involved in this 200-unit deal in Georgia?
Brent Barcus: Just single family. So I had some cabin rental in Gatlinburg, and then just single-family rentals. So single door.
Slocomb Reed: That's a bit of a leap...
Brent Barcus: Yeah.
Slocomb Reed: Tell us about the steps that you took to go from single family to co-GP on 200 units. I'm asking two things here. One of them is, Brent, what is your role in this deal that you're in currently, and also give some advice to our listeners who want to do the same thing, who have a similar single family rental, short-term rental dabbling background, who want to go get into deals that size.
Brent Barcus: Absolutely, thank you. I think my way into this was just really researching the different size of properties first. Coming from single-family, I was like, "Okay, if I want to scale, I want to have a larger operation that's handling these investments." I looked at quads, or sixplex, or even 22, or 36, all these different sizes... It still required more probably of my physical time, and not as much full-time property management on site. So as I started looking at some of these options, and just obviously going in and doing a lot of events, listening to a lot of masters in this industry, it felt like the amount of time, scalability - it's all the same. The deals are the same, the way they get structured, and the process of getting into a deal, so I thought "Why not just partner up, learn some of the best, and being a part, even a small part of some of these larger opportunities? It gets me in the game that I want to be in long-term anyway.
I thought, first, which - a lot of people like maybe your family and friends would say, "Well, you start with the single, then you go to the four, then you go to the 20", and you've got to build yourself up. But I was just seeing that a lot of people were jumping right into the larger deals in these GPs, and bringing value in whatever way their skill set is, and getting into those larger deals right away, and not having to worry about scaling up into the unit sizes.
So I kind of just followed that path. Honestly, a lot of it is networking. I said, "Hey, I want to set a goal of I want to be in a deal by the end of 2022." So I went to a lot of networking events, local and just all over the country, and started meeting great operators, capital raisers, and just introducing myself and "Hey, I'd love to provide value. Can I bring capital? What can I do to get into one of these deals?" And started underwriting just to really learn what's going on.
Break: [00:08:43.28]
Slocomb Reed: Let me summarize the Brent Barcus plan for getting into apartment syndication. You can correct me when I'm wrong and add details where you don't think I'm getting the summary quite right. Step one, figure out what you want. Step two, find the people who are doing it or have it. Step three, figure out how you can add value to then. Step four, profit. Has it been that simple? Where do we need to add detail to that?
Brent Barcus: I'd say those are the wide view of it. There's a lot of obviously hours and time put into that research, learning all the intricacies as much as I can through podcasts and on-site, local network, meetups, everything; just asking lots of questions. But I would say that would be my path. And honestly, it goes back to when I came to Nashville, that was a similar thing - a lot of it is who you know; and in music, like who you know, get your skills up as sharp as you can, and start hanging out with the right people, and referrals... And then things can snowball from there, so how do I provide value in this band, or on this session, playing on a record? What part of my plane in this creative project and being that team player and finding out how I can connect with the people that we all have the same creative juices and business plan for what we're trying to get accomplished?
Slocomb Reed: Brent, what are the things thus far that have not come naturally to you, where you have felt like you really needed to develop a skill?
Brent Barcus: That's a great question. I would say probably more the really deep level of the underwriting. I would say I tend to be gifted more in the outgoing relationship building, talking to brokers, meeting investors. So I'd say it'd be more really sitting down, taking an analyzer, learning how these things run, and then trying to see if something is even worth pursuing. So I would say that side of my brain isn't as sharp, and I've had to try to think, "Okay, I need to at least get great at this enough to where I can look at a deal and see if it's even worth pursuing." And then passing that off to somebody that I really love, that has the deep skillsets in underwriting, and realizing that "Hey, that's not something that I'm going to do on the deeper scope of things."
So it would probably be the underwriting side, the numbers. And then I'd say I'm learning on the capital raising side. I think maybe it's more of a belief system of fear of "Hey, I've been in another industry for a long time, that I'm passionate about. But I'm also passionate about investing in these assets." Then sharing that with people not in that space. "Check out what I'm doing. Would you be interested in maybe investing in a deal like this passively?" So getting that courage, I think, to then how to communicate that and what I'm doing, that maybe is different to what they think of who I am, or what I've been doing all my life.
Slocomb Reed: What advice do you have for rebranding yourself to your own sphere, so that people think of you as someone who's in real estate?
Brent Barcus: Great question. Branding. I've tried to just slowly put things out, new content on things that I'm learning. It could be just a piece here and there, or I created a separate Facebook business page for multifamily. So basically putting out articles, or "Hey, look at this alternative asset to invest in passively. What is a syndication?" We forget that a lot of people don't even know what some of these terms are that we all throw around, about syndications, and GPs, and LPs, and 506B's, and all these different -- SEC things... So trying to break it down to where I simplify it and share that information about this opportunity. So we're trying to break it down and make it simpler, and "Here's what I'm learning." And then it's intriguing to others. Like "What are you doing with these apartment investing?" and you start to get people to dialogue with you on socials. It's been really interesting.
Slocomb Reed: Brent, before we transition this episode, let's talk about the market of the moment for a moment. You're currently only involved in a syndication in Georgia, but you're doing deal-sourcing in Nashville. We're looking at Q2 2023 right now, but what is it you're seeing when it comes to deals in the Nashville area?
Brent Barcus: As everyone knows, Nashville's just on fire still, and it's an exciting time, because it used to be a small little country town in the '90s and has grown so much. So it's crazy. Obviously, we have money coming in from all over the country, all over the world, really. So it's a little slow. It's a slower market. There are deals happening. There's a lot of new builds happening downtown in the core. So there's a lot of new construction going on, institutional assets... But the submarkets and tertiary markets are really good. There's more going on there. And I still think with the whole bid/ask gap, sellers still thinking that we're in a year ago, but obviously everything's changing... So I still think things are bottlenecked with the bid/ask, so we're not really seeing a lot of cap rate expansion yet... And then also with obviously the loan distress... I'm kind of hoping for Q3 and Q4, where there's going to be more opportunities on the loan distress side; either rescue capital going into current deals, or actually buying deals from loan distress, so I'm excited about that.
Slocomb Reed: It'll certainly be interesting to see what plays out the second half of this year. Brent, are you ready for the Best Ever lightning round?
Brent Barcus: Alright, let's do it!
Slocomb Reed: What is the Best Ever book you've recently read?
Brent Barcus: I love this book right now, Bo Berry. He's a top broker in Florida. "Multifamily investors who dominate."
Slocomb Reed: I interviewed him on this show. Yeah.
Brent Barcus: Love this book. I'm just devouring it right now. It's a daily resource for me on just how to become an elite investor. That's my goal.
Slocomb Reed: What is your Best Ever way to give back?
Brent Barcus: Best ever way to give back... Taking care of my kids, and then House of Worship church, I love donating time, music... Obviously, my background is music, so love giving back in worship music and kids?
Slocomb Reed: Well, let's take this next question back to your residential investing days - what was the biggest mistake you made, and the Best Ever lesson that resulted from it?
Brent Barcus: [00:16:22.08] I traveled a lot when I was touring with musicians and artists. Probably not at that time focused on buying more assets... So probably my biggest lesson was acquiring more opportunities, and then using that as leverage to then eventually scale and buy more property. So I'm already telling my son, who just turned 16, that "You're going to be investing a lot earlier than I ever did", and just to have that mindset... So that's probably the biggest lesson, of just not buying enough property, and having more rentals.
Slocomb Reed: On that note, what is your Best Ever advice?
Brent Barcus: Best Ever advice. Don't wait. Get in now; whatever you want to do, just jump in. You can always try to time things. It's never going to work. I decided to just jump in, start learning, and... That's my advice, is just get started. Start listening to podcasts, go to events, and don't wait. Just fall in love -- whatever it is, fall in love with it and devour it.
Slocomb Reed: Last question. Where can people get in touch with you?
Brent Barcus: Thanks so much. Oh, gosh. Let's see. Email, Brent [at] I65capitalinvestments.com. And then social media, LinkedIn at Brent Barcus, and Facebook and Twitter as well, @BrentBarcus. Yeah, shoot me an email. I'd love to talk multifamily.
Slocomb Reed: Those links are in the show notes. Brent, thank you. Best Ever listeners, thank you as well for tuning in. If you've gained value from this episode, please do subscribe to our show. Leave us a five star review and share this episode with a friend you know we can add value to through our conversation today. Thank you, and have a Best Ever day.
Brent Barcus: Thank you, Best Ever listeners. I appreciate it.
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