July 17, 2022

JF2875: Benefits of Pivoting to Boutique Hotels ft. Ramsey Blankenship


Ramsey Blankenship is a full-time Master Chief Petty Officer in the U.S. Navy Special Operations who began investing in real estate in 2015 with a house hack in Panama City, FL. From there, he expanded into multifamily units, then began doing joint ventures with partners in different states along the Southeast. 

Today, Ramsey is a capital raiser and sponsor at Real Focus Capital Investments. He is also GP of 20 apartments, 10 short-term rentals, and a boutique hotel. In this episode, Ramsey shares how he got into the boutique hotel space, why he decided to pivot from multifamily to RV parks and boutique hotels, and how he raises capital for these properties.

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1. Breaking into the Boutique Hotel Space

Ramsey didn’t set out to become a hotel owner, but the opportunity presented itself after a friend’s father passed away, leaving the property behind. “The numbers worked on it, so I said maybe we need to lean into this small boutique hotel space,” he says. Because roughly 25% of workers are now operating remotely, he says he has seen a rise in occupancy and been able to capitalize on travelers who have adopted a nomadic lifestyle.

 

2. Pivoting Away from Multifamily

The multifamily market is saturated, and the effort Ramsey had to exert to find deals began to take its toll. “Underwriting 200 deals to find one versus what it takes on a boutique hotel or RV park … on the front end, there’s a lot more work that goes into multifamily, especially right now,” he says. Ramsey and his team decided they would rather focus their time and effort on a property they owned versus one that they simply wanted to own. 

 

3. Raising Capital for Boutique Hotels and RV Parks

Ramsey is currently under contract for an RV park and motel combination, for which he is doing a joint venture. He says he didn’t raise capital for his first boutique hotel. 

“I didn't feel comfortable raising money from investors for something I haven’t done yet,” Ramsey explains. “However, we are starting a fund where people can invest so that we can go out and purchase smaller boutique hotels.” It doesn’t make sense to syndicate these properties since the price point is typically less than $2M, but with the fund, he can purchase multiple small boutique hotels to reach that price point.

 

Ramsey Blankenship | Real Estate Background

  • Capital raiser and sponsor at Real Focus Capital Investments, which syndicates large, value-add B- and C-class apartment complexes. Recently, they have pivoted into the hotel/motel/RV park space.
  • Portfolio:
    • GP of:
      • 150+ units
    • LP of:
      • 32 units
  • Works full time as Master Chief Petty Officer in the U.S. Navy Special Operations.
  • Based in: San Diego, CA
  • Say hi to him at:
  • Greatest lesson: Don’t invest in a market without understanding the market metrics. I purchased nine units in Shreveport, LA, arguably the worst market in the U.S. to invest in. I learned you can not simply "cut and paste" what works in one market into another. I now conduct what I call the "Market Vital Signs" before investing in anything.

 

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TRANSCRIPT

Ash Patel: Hello, Best Ever listeners. Welcome to the Best Real Estate Investing Advice Ever show. I'm Ash Patel and I'm with today's guest, Ramsey Blankenship. Ramsey is joining us from San Diego, California. He is a capital raiser and sponsor at Real Focus Capital Investments. They focus on value-add apartments and recently pivoted into hotel, motels and RV parks. Ramsey's portfolio consists of apartments, short-term rentals and a boutique hotel, all while working a full-time job as a Master Chief Petty Officer in the United States Navy Special Operations.

Ramsey, thank you for joining us, and how are you today?

Ramsey Blankenship: Hey, Ash. Thanks for having me on the show, brother. I'm doing good, doing well.

Ash Patel: It's our pleasure. Ramsey, before we get started, can you give the Best Ever listeners a little bit more about your background and what you're focused on now?

Ramsey Blankenship: Yeah. So I started investing in 2015. I started with a house hack locally in Panama City, Florida, expanded from there into a little bit of smaller multifamily units, 10 units and below, then I started doing joint ventures with a couple of partners in different states along the Southeast. And then now, since I've moved out to San Diego, California, I did another house hack out here and got into syndications. And that's what I'm doing now.

Ash Patel: Alright. Well, listen, you're making it sound simple. You've got a full-time Navy career. How did you start this company?

Ramsey Blankenship: In the military, I call it the accidental landlord. What ends up happening is we have the VA funding program to where a service member is allowed to buy a house with zero down, and doing that in big markets where usually the Navy is stationed at is a pretty big resource, especially out in California, where half a million dollar home isn't something you can normally afford the down payment on. So I was able to purchase a house, and then at the time I was reading a lot of the Rich Dad Poor Dad, a lot of Dave Ramsey stuff. And after all of that, I sold the house that we lived in, and at 23 years old was able to put $40,000 in my pocket. And Ash, that was like game-changing money for me. I'd never seen $40,000 before my life. So what I realized like, "Hey, man, all I've got to do is live in a house so I can make money. This is pretty awesome", so I started leaning into real estate pretty heavily.

From there, when I moved down to Florida, the barrier to entry of owning any investment property was much smaller than in San Diego, California, or really any city that has an NFL team inside it, is what I like to say. Once you move into those smaller markets, you can get started pretty easily for very little. And that's what happened to me. And since there, everything that I buy has gotten bigger and more different every time. And for that, it's been a little bit more difficult, but I believe wholeheartedly that everything you want in life exists just outside your comfort zone. So when I buy something new, I try to make it a little bit harder on myself, and it's been good sometimes, sometimes it's bit me, but I like to learn as I go. So that's where I'm at.

Ash Patel: You had 40 grand at 23 years old. Did you blow it or reinvest it?

Ramsey Blankenship: No. Actually, at the time, I had read Rich Dad Poor Dad... And the way I grew up, my dad had always told me, "Don't buy a brand new vehicle", but I had bought used vehicles the entire time, and on that move across the country, my used vehicle broke down on me and I wanted a brand new vehicle. I was like, "I'm tired of this. I need something more reliable. I need something that I can travel around with my family and not fear it breaking down on the side of the road." So I was looking at getting a brand new truck that was roughly 40 grand, but I was also wanting to get started in real estate, and there was a duplex for sale for $40,000. And that should tell you, living in San Diego, you couldn't even buy a mailbox for 40,000 bucks. And I remember the quote that says, "Don't ask if you can afford it, ask how can you afford it."

So I was looking at about a $600 a month truck payment, and the cash flow from the duplex was roughly $600 a month. So I took that 40 grand, financed it and bought the duplex that ended up allowing me to pay off the truck in five years. So I got a free truck out of my first real estate property, and that kind of showed me the power of asking the right questions; just changing out one word, how can I. And it made me think differently to solve the problem, and in doing so, now anytime I want to purchase something, I go look for the asset that I need to purchase that's going to pay for the liability or the luxury that I want to own, and it's worked out quite well.

Ash Patel: Indeed, a powerful lesson. Explain the formation of your company.

Ramsey Blankenship: Okay. So our company is realfocused.org, and I developed this company with a couple of partners out of necessity. What ended up happening - most of the people getting started out, they're going to use their own money to get going. And what ends up happening is you start to develop a track record in the real estate world where you purchase property. And I was deploying money out into the market, and it was coming back to me, but in small increments. Well, after a couple of down payments, I pretty much ran out of money. I had cash flow coming in, but I had more deals coming in than I had money to purchase, and they were good opportunities.

So I started partnering up with friends of mine who were interested in real estate, and eventually that pool of money ran out. And that's when I learned about syndications, where you could offer up other people who don't have the time or the education to invest in real estate, you could offer them an opportunity to purchase a portion of real estate in a passive manner. And that really all syndications is - it's just a tool for being able to purchase larger projects. And once I unlocked that tool in my toolbox, I was able to pretty much purchase anything that we want as long as the numbers make sense for our investors.

Ash Patel: And how did you find your partners?

Ramsey Blankenship: Well, one of my partners, the first partner, he was one of the joint venture partners we'd invested in together, and he runs another company that I had started in the baseball world with him. And he did such a good job. And when I first got started, man, everything that I was doing, I was trying to keep doing it all myself, and I wasn't including anyone else. And I was thinking, "I don't want to ask anybody for money." But then one of my mentors pretty much told me, "You're being selfish." I was like, "How am I being selfish by not asking people for money?" And he said, "Look, man, you've kind of figured out the formula on how to make money. You're not asking people for money, you're offering them the opportunity to make them money."

So Brandon, my partner, whenever we'd get our dividend cheques from our baseball business, he'd ask me, "What are you going to do with your cheque?" And instead of saying, "I'm going to go on on a trip", or "I'm going to buy a new truck" or something, I said, "Man, I'm putting this in real estate." So that attracted him, because he wanted to invest as well. And that's how me and him partnered up on the joint ventures, then we ran out of money, and decided we needed to start raising money from other folks.

That's pretty much how we got started. And then to build out our team - he's very strong at task management. I'm more strong at capital raising or understanding the vision of putting together policies and principles... But I need that guy. He keeps me accountable. He makes sure that the things that I say I'm going to do, I do actually do... But we were missing a project manager of boots-on-the-ground person, so we eventually found our other partner, Joey Bickham, and that guy has been a force multiplier. He's been able to take some of the projects that we had ideas and actually turn them into fruition. So it's all about complimenting your weaknesses, right? [laughs]

Ash Patel: Yeah.

Ramsey Blankenship: Whatever you're not good at, find somebody who is good at it and add them to your team.

Ash Patel: You seem very disciplined, obviously with a Navy background... You seem to accept challenges, find solutions. What's a challenge that really roughed you up? What's a tough encounter that you've had?

Ramsey Blankenship: So one of the things that I did wrong whenever I was invested in Panama City, Florida-- that market was very good, and whenever Brandon wanted to get involved, he asked me, "Hey, man, how can I get involved in real estate?" And I was like, "Well, I don't need you in Panama City, Florida. I have the relationships. I can do this all myself. But I can't do it where you live." And where he lived was Shreveport Louisiana, which I did not know, at the time was a very poor market for multifamily. So what I ended up doing was cutting and pasting what I was doing in Panama City, Florida in Shreveport, Louisiana, and it does not work that way; not in real estate. I didn't understand how to read market metrics. I didn't understand that you can make money in a bad market, but you can lose money in a good market. Well, I was losing money in a bad market. So that's a very hard challenge to work yourself out of. In fact, that's the only property that we've lost money on. I'd say we broke even on the actual finances, but we lost about five years of effort, just to be able to get it to break even. And to overcome it - and I remember it clearly, man; I was doing my taxes about 2018. I closed out my books for Panama City, and man, I was crushing it. And then I did my taxes for Shreveport, Louisiana and realized that we had lost $250. [laugh] I was like, "Oh, God. Man, what's going on, Brandon?" And he said, "Look, man, we have delinquencies. We have high vacancies. People down the street are offering the first month's rent free." And that was the first time I'd ever heard of that because I was just kind of focused on Panama City.

So from there, we ended up saying, "Alright, we've got to figure out how to read a market. What is this market telling us?" Well, Shreveport was losing population. It was losing jobs. It was increasing in crime. The median household income was going down, and the price of properties was going up. It didn't really make a lot of sense to me. So we flew Brandon out - because I was in San Diego at the time - to Los Angeles, and sat down with a guy who reads market data, and had him teach us for three days in one of his boot camp, how to look at a market from the macro data and distill it down to which neighborhoods you should invest in, what are the up-and-coming areas... And it doesn't save you from being a bad operator, but it gives you the best possible scenario to be successful.

And once we really started being able to dial in which markets make sense, we haven't had to spend so much time solving problems that the market would bring you, and we could focus on the problems that the property brings you. And I'm much more willing to pay attention to problems that the property brings you, because those are solvable problems. The ones that the market brings you, that problem you bought. You bought that problem and it's really not something that you can solve.

Ash Patel: Yeah.

Ramsey Blankenship: So I would say that would be the one that taught us the most, but I wouldn't exchange it. And I have a saying, if you're not earning, you better be learning. And we learned a lot in that market, brother. We learned a ton on how to do business.

Ash Patel: Yeah. You know, it's amazing how some of these hard lessons are really a blessing in disguise. So a lot of successful people, we all have them and we've all gotten our butts whooped on certain deals, but enormous lessons to be learned. So it's good that you didn't lose a lot of money on that deal, but you learned some great lessons. How big did you get in the multifamily space before you decided to pivot?

Ramsey Blankenship: In the multifamily space, we had done a seven unit. I did that by myself. We partnered on a 10 unit. We bought a hotel. It was a small hotel, so it wasn't really multifamily, but similar. And then once we got into syndications, we did a 119-unit and a 32-unit. But what really happened during COVID - your listeners probably know this - the price of multifamily went way up. The market was saturated with other syndicators and it seemed to me like a time to pivot. Because we were underwriting about 200 deals to find one that actually worked.

That hotel that landed in my lap - I bought that from a friend whose father had passed away and the mother just wanted to offload it - the numbers worked on it. And so I said, "Well, maybe we need to lean into this small boutique hotel space." It's kind of been overlooked for a long time. There's still mom-and-pop operators. And not only that, now Airbnb and VRBO have had mass adoption by the entire United States. And we were able to find a pocket, small boutique hotels in places that are travel-dependent, and we look for properties that are 30 units or less, that are owned by mom-and-pop, typically off-market, and we'll purchase them and we'll bring some of the modern technology to it, things like putting them on the short-term rental platforms, remote entry, making them COVID-friendly, and looking for areas that really depend on travel outside of the large cities, so that you are a lot more friendly with the local legislation... Because out here in San Diego - San Diego has so much industry; they do not care if my little short-term rental business is successful. They have a housing market problem where affordable housing is non-existent. So they need more units for long-term tenants to support their industry.

Well, if you go look at places like out in the mountains where there's views, waterfalls, lakes, streams - those are typically in very rural areas that that local legislation needs tourism to come into place. It's also a place that's really hard to build and hard to get into for large hotel industries like the Marriotts and the Hiltons. They're not looking at these places because the local population and travel industry doesn't support their business model, but it does support for smaller boutique hotels, and people want to go stay and get more of a custom experience. So if you've got some of the local amenities like not necessarily your hotel is a destination location, but that area as a destination location, then you'll likely be successful.

Ash Patel: Are you in seasonal destinations, or are they year-round busy?

Ramsey Blankenship: No. We try to keep all of our properties as a four-season location. And the biggest one that's going to keep you out of a season is going to be snow. So we don't really invest too much North of Kentucky. The majority of our properties are in the Southeast, so you get all four seasons. People are traveling a lot more locally now, especially since COVID. And then the increase in remote workers prior to 2019, it was at 6%. It went up to 35% remote workers, and now it's expected to stay at 25%. So that means that for one and every four people in the workforce environment, one person is going to be able to work remotely, and they've pretty much adopted this nomad lifestyle where they'll bounce around from different places. Because as long as you've got good WIFI and they'll pull in a good big city income but be able to live in small town and get small-town gas prices, small-town accommodations, and be able to stay away from their homebase for a much longer period of time - you can capitalize on the income, because a lot of these people are making very good W2 money. They're just able to do it from a remote location. So we've seen a lot of increase in occupancy from travelers like that.

Ash Patel: Ramsey, back to your last multifamily property - 132 units... What were the numbers on those?

Ramsey Blankenship: It was a 32-unit in San Antonio, Texas. We did two. So the 119-unit was in Lubbock, Texas, the 32-unit in San Antonio, Texas. It was kind of a creative deal, because the previous owner had done a loan which had a yield protection on it. Basically, he had an early payment penalty, and he wanted to get his equity out. So we had to raise quite a bit more money to purchase his equity out, and we have early payment penalty for six years; we can't get out of the property, so it's a six-year hold. But because we were able to do that, or we were willing to do that, we were able to get the property at a pretty good price... Whereas most of your multifamily operators, they know now good prices - it's kind of hard to come by whenever the market is extremely hot. But it's a 20% annualized return to our investors. The cash-on-cash isn't going to be great, but it's spread out over the six-year hold. So what we don't have built-in is a refinance period. Typically, you're going to see within the first two years a refinance period, where a lot of the investors are going to get their initial return of capital back to them. But our investors were fine with investing and getting a better level of cash flow for years one and two, and then that spreads out after the construction period is over without doing a refinance. So a 20% annualized return.

Ash Patel: For the boutique hotels, are you raising capital?

Ramsey Blankenship: We did not for the first one that we bought. We're currently under contract for the second one, which is an RV park and a motel combination. We're doing that one as a joint venture. And the reason is we added that RV park aspect to our portfolio and I didn't feel comfortable raising money from investors for something I haven't done yet. However, we are starting up a fund where people can invest so that we can go out and purchase smaller boutique motels.

And the reason that that is, is it doesn't make a lot of sense to syndicate a property that's less than $2 million price point. The legal fees and the time invested just doesn't quite make the numbers work. However, if we have one fund that we are able to purchase multiple small boutique hotels, we can reach that price point between 1 and 2 million dollars and purchase multiples of them. And yes, the cash flow on those is a lot better, because it's kind of like the difference of selling one water bottle at a convenience store versus buying a gallon jug at a grocery store. They both cost about the same amount, but you're selling a night's stay instead of selling a year-long lease. So the cash flow is much better. The equity is not going to be quite as high in the hotel space.

Ash Patel: With that fund, when do you pitch investors? Is it before you get the deal, or is it when you get the deal?

Ramsey Blankenship: You do need to start getting soft commits. So whenever you're starting to set up a fund like the one we want to do, it's about a six-month process if you're serious about it. So we haven't started collecting any funds. You're not allowed to collect any funds until your PPM is all set up, and you start collecting the money after people sign the docs. But you're going to have a round, is what they call it, in which you have your target amount of money that you cannot release any funds until you reach that. We have not started the fund as of date. We just went and sat in on a course in Vegas on how to do it. And we're probably 6 to 12 months out from actually launching the fund, and that'll give us enough time to purchase the RV park motel, figure out the logistics of that, and then throw RV parks into the buy box, if you will.

Break: [00:20:06] to [00:21:53]

Ash Patel: Can we dive into the numbers on that boutique hotel that you bought?

Ramsey Blankenship: Sure.

Ash Patel: Alright. What was the purchase price?

Ramsey Blankenship: $390,000.

Ash Patel: And how many rooms?

Ramsey Blankenship: Eight.

Ash Patel: Now, no issues with putting all of those rooms on a short term rental platform?

Ramsey Blankenship: No. So what you can do is you can use platforms like Guesty. We use a system called a [inaudible 00:22:16], which was contracted by the previous owner. So we're still under contract with that. I feel like it's kind of an outdated system. Guesty is definitely more streamlined, it's got a better dashboard. But what you can do is you can simultaneously list your bookings on Booking.com, Airbnb, and VRBO, and they sync calendars up to where when one room gets booked, it's not available on the other calendars. Instead of having eight Airbnb available rooms in one little saturated spot on the map, we listed two different rooms. One is our unique room... This property is pretty cool. It used to be a bank, and then it got converted into a boutique hotel. So one of the rooms has a vault inside of it. It's got a drive-through window where the teller used to hand out cash and stuff. That one's unique. It's different than the other seven rooms. So we listed that as an individual one, and then the other rooms, we have one listing for king size and one listing for two queens. And they all look pretty much the same. So it's just like going into a hotel; you don't know exactly what your room number is, you just pick a king or dual queens, and then when you show up, you get assigned that room, if that makes sense.

Ash Patel: And you said touch list. Do you not have a receptionist?

Ramsey Blankenship: We do. We like that for that location, because we came with a lot of existing customers that expected that level of service. The demographic is a much older demographic, like bird watchers. We have a group called the Lemon Drops, which is a group of older ladies that come into town a couple of times a year, they book the entire place out. They have been going there for 15 years, so they expect to see the same receptionist to get that service. So we kept that on board, but what we were able to do is attract a much younger demographic who's adopted Airbnb, they're looking for places to stay via Airbnb, so it brings a little bit more youthful customer base. And we've added that on top of what we were already doing with our existing customers.

Ash Patel: Can you also walk in and get a room?

Ramsey Blankenship: You can walk in and get a room. It's not going to be like a Hilton or Marriott where there's constantly someone there. If you show up, there's a number to call, and we have someone on staff that can be there within five minutes, and they will give you a room.

For this specific hotel, if we have somebody walk up, it's likely overflow from-- there's a city like 20 minutes up the road that has Hiltons and Marriotts, and they get booked up quite a bit, and they push their overflow to us. So those types of customers are kind of expecting the Hilton and Marriott services. And if they show up during business hours, they'll get it. But if they show up after hours, we have somebody who has the phone who can answer the call and get them a room.

Ash Patel: So a $390,000 purchase price. What do you expect in revenue throughout one year?

Ramsey Blankenship: We were able to take the occupancy of that place from 33% up to 55% within the first three months, just by adding the short-term rental aspect to it, doing a little bit of marketing, getting on some of the billboards along the interstate, which is 30 minutes north. Our break even on that is at 35% occupancy. So as long as we're hitting 35% occupancy, we're making about 30 to 40 bucks per night, per room. Now, the purchase price I got it at was specifically because I bought it from friends and family. In fact, once I started putting my name out there - remember I told you, in the beginning, I was doing everything myself; I was kind of keeping everything to myself too. And properties weren't being brought to me, I had to hunt them all down. But once I started getting active on social media and telling people what I was doing, I was trying to raise money for deals that I knew existed. I didn't even think that deals would be brought to me.

Well, once I put my name out into the universe that, "Hey, I'm doing multifamily", a friend of mine reached out and said, "Hey, my parents are getting ready to sell a hotel. Dad's health is going down. Are you interested in buying it?" At the time, hotels, motels was not even on my radar. It was all multifamily. So it didn't meet my buy box, so I said no. About six months later, they said, "Hey, we're about to put this on the market. This is your last chance before we make it public. Do you want to buy it?" And I stopped to think about it. Somebody has reached out to me twice trying to sell me their property. This is like a true off-market deal brought to me by the sellers wanting to get rid of it. I should probably look at these numbers." And when I did, I made them an offer that made sense to me, and they accepted it. So during the sale, I got all of the old paperwork. And I bought this in 2020, and in the paperwork, there was appraisal from 2012 for $600,000. So I already had $210,000 in equity built in from 2012. It's very hard to figure out what the only hotel in town is worth in a very small area, but I do know that whenever we go to sell it, it's probably going to be closer to $800,000, $900,000 from a $390,000 purchase price.

Ash Patel: Ramsey, in terms of managing this asset, I would imagine you have somebody that turns the rooms, and that one receptionist that's there sometimes, and remote other times. Is that all you have?

Ramsey Blankenship: Correct. One of the things-- and again, anytime I find a new style property, I try and seek out somebody who's done it before... And I can get annoying about it; I'll ask you questions. Well, I talked to a mentor and he said, "The one thing you have to do before you purchase this is make sure the management problem is solved." Well, it came with an existing manager. She did a great job. But one of the issues she was having is she was getting a little worn out. She used to have help; that help passed away, and she needed more help. So we ended up getting a second manager at the same price, the hourly rate, and we added a couple more cleaning personnel, and they managed the cleaning personnel. We put them on a schedule. The cleaning people know when the turnover is going to happen, the managers are more of the face of the place, and then my partner and I are the asset managers who run the numbers and kind of say how much marketing dollars we need to put into it and shift the direction of the way the hotel was going.

Ash Patel: Do you 1099 the managers, or are they W2-ed?

Ramsey Blankenship: They're W2 employees.

Ash Patel: So now you've got a legit payroll.

Ramsey Blankenship: Yeah.

Ash Patel: You're running another business now, in addition to your real estate business.

Ramsey Blankenship: Yeah. I will tell you, at eight units, the economy of scale of that - and we adopted one of the employees, so we just put the next employee on the same thing. The cleaners are 1099. They get paid for job as the turnovers happen. Our managers also will do cleanings if the turnover personnel-- because they do cleanings throughout the town, if they're not available. But I like having someone on W2, because you can kind of mandate when they are supposed to be there or what jobs that they have to do. Whereas the contractors, it's a contract. It's an agreement of when they will be available. And hotels have issues that come up that need to be solved immediately. And you need to kind of reduce the amount of time between problem and solution by having somebody who's constantly available.

Ash Patel: Ramsey, what is your best real estate investing advice ever?

Ramsey Blankenship: The word that's constantly in my head would be reach. Reach for it. And the reason I say this, I was an instructor at the US Navy Dive School, and one of the first things that my commanding officer sat me down and told me, he says, "Hey, look, when you're pushing these guys through school, it's not as much as a physical aspect as it is mental." He says, "Your mind will tell your body to quit at 40% of what it's able to take." And that concept has kind of led me to think, “Alright, whenever I'm willing to give up or I'm thinking about giving up, I'm 40% of the way to success. I've got 60% of what I have left in me."

So when you want something, you've got to freaking reach for it. And every time I set a goal, I'll set it out for five years from now. If I don't daily reach for that goal, that's just an idea. That's just a thought. That's just something that you want to have happen. It's not something that's going to happen. Each day, you've got to reach for it. I don't glamorize the grind. I don't tell people, "You've got to grind it out every day", because what kind of life is that to live? But the motto that I kind of go by is build your mountain with a layer of paint every single day. So each morning, I'll get up and I'll put an hour into real estate, of some capacity. Today, I've got on a couple of different calls this morning, and then I've got this call with you. That's what I'm doing in real estate.

I have a W2 job, so after this, I go to my W2 job and for the rest of the day, I'm not thinking about-- well, I am thinking about real estate, but I'm not doing real estate. I'm spending time with my family, spending time with my peers. I'm spending time doing things I love to do, so I can start tomorrow morning with a fresh battery and put that hour in. And that hour is just one more layer of paint added to my mountain.

Ash Patel: Ramsey, what would you tell multifamily people that are looking to pivot into boutique hotels?

Ramsey Blankenship: I would say "Here's why I pivoted." Underwriting 200 deals to find one, versus what it takes on a boutique hotel or an RV park. There's a lot more work that goes in after close on these types of assets. Whereas multifamily - the market determines the price, you've got year-long leases, your asset management is much less. But on the front end, there's a lot more work that goes into multifamily, especially right now for you to be able to actually get that deal.

So the question I had to ask my team is where are we willing to put our time into - before close or after close? Because I am much more willing to put time and effort into something that I own, versus something I hope that I own. So that was what the pivot was for us. We saw the saturation happen in multifamily, we saw the market shifting, we saw it peaking, we saw lendability was going to go down as interest rates went up. So for us, where do we want to put our time? Where do we want to put our effort - into something that we own or something that we want to own? And for us, it was for something that we owned.

Ash Patel: Yeah, that's a great outlook. Ramsey, are you ready for the Best Ever Lightning Round?

Ramsey Blankenship: I think so. Let's do it.

Ash Patel: Alright. Ramsey, what's the best ever book you recently read?

Ramsey Blankenship: Alright, so I've read it a couple of years ago, but I constantly review it, and it's The ONE Thing by Gary Keller and Jay Papasan. It's written by real estate guys, but it's more specifically written about goal-setting. And it takes something that seems obnoxious for you to be able to accomplish, and it teaches you a way to break it down into individual, biteable chunks, so that you know what's the one thing I need to do today, what do I need to reach for today so that I can accomplish my goal in five years from now. And I've tabulated that book, I've highlighted all of the key things.

Actually, I'm putting my daughter through like a mini goal-setting course right now, and it's kind of revitalized some of the goals that-- we're all humans. I forgot about some of the goals that I had set, and maybe they're obsolete now, but I remember why I wanted to set those goals, and I take the reason why and apply it to a new goal, or a new setting. And what I'v found was I would set five-year goals, and some of them I would accomplish in two years; some of them I would get close enough to reaching the goal that I could live with that. Like, if I wanted to have 2000 units, I only ended up with a 1000 - well, man, there's no problem with reaching for the stars and landing on the moon in my book. But a lot of the times what I would see was happening is I would set a goal in my head that I thought was way too big and I would reach it early and adjust that goal to be even bigger. Because I don't really like to invest anything that's not scalable and that's going to take up a ton of my time. And I've set goals to have a certain unit count within five years and ended up passing it up in one year.

So for me, when you have a goal and it's measurable and repeatable, it'll actually happen, and you've just got to reach for it every day and put in the work. And that was one thing that was put to me by a recent mentor that I had on my podcast. He said, "I can give you all the information, all the tools, all the systems that you need to have to be successful, but what I cannot give you is the hard work. You're going to have to do that yourself." And to me, that's very, very true. If somebody gives you a free template or a free eBook, or a friend loans you a book, all the information is there; you've just got to read it and do it. It's not this big, scientific anomaly. If I went and asked anybody on the street what's it take to lose weight, they would probably say, "Eat less and work out more." But has everybody who's wanted to lose weight, lost weight? No. The information is there. The science is proven. You just have to do the work. And that's what a lot of people are not willing to do.

Ash Patel: Yeah. Ramsey, what's the best different way you like to give back?

Ramsey Blankenship: Alright, so on the real estate investing side - I don't know if you'll let me plug the Facebook group or whatnot--

Ash Patel: Sure.

Ramsey Blankenship: ...but we have a Facebook group called From Middle Class to Millionaire. I post in there all the time, inspirational, motivational stuff. We post things that will help you get out of the middle class the way that we have. And if there's anybody who defines the middle class, it's a government employee; exactly what the government says this is what middle class should be. And I've been able to set it up to where I can retire in three and a half years - I'll be 38 years old - and I'll be fine. That's how I give back on the real estate investing, side is through my Facebook group. We do coaching. We do mentoring. We make posts. We'll help you get to where you want to be.

Outside of investing, one of the things I just finished last Saturday - I really like nature - I did a 28-mile hike for the Make-A-Wish Foundation, where I had to raise 2,500 bucks to do so. We hiked along the Pacific Crest Trail and Big Bear, California. And man, doing that and then finishing it up, they showed us that everybody that participated raised $650,000. And some of the kids that were the Make-A-Wish recipients were in the room, and just seeing the impact on those families - it really solidified my why.

I'm in a place now where I can give back. My wife and I have helped get a family out of homelessness on the streets. We're able to put money towards the Make-A-Wish Foundation in creative ways. Things that I like to do, things I don't just get burned out on doing, like hiking, are really getting into a little bit of philanthropy. I really do enjoy that stuff, because you see the impact of what you're doing in other people's lives.

Ash Patel: Ramsey, how can the Best Ever listeners reach out to you?

Ramsey Blankenship: The best way to find me is to join our Facebook group From Middle Class to Millionaire. I'm very active in that. Look me up on Facebook, Ramsey Blankenship. Or if you're interested in investing with us, then go to realfocus.org and fill out our investor questionnaire. We'll reach back out to you and get you there.

Ash Patel: Ramsey, I've got to thank you for being on the show today. Thank you and your family for your service and your sacrifice. And thanks for sharing your story, starting out in 2015 with smaller properties, learning how to take VA loans, teaching others to be accidental landlords and pivoting into RV parks and boutique hotels. So thank you again for sharing your story with us today.

Ramsey Blankenship: Ash, thanks for having me, brother. I appreciate it.

 

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