Jeremy was serving in the Air Force when he tore his Achilles in pilot training. He was laid up, reading real estate investing books. When he was able, he took action and started flipping homes with unique problems. Now he also owns 40 units. If you enjoyed today’s episode remember to subscribe in iTunes and leave us a review!
Best Ever Tweet:
Jeremy Porto Real Estate Background:
- Became interested in real estate while recovering from injury in USAF pilot training
- Flipped 15 properties in 3 different markets including meth and Chinese drywall homes
- Owns 40 doors in 3 states including recent 13-unit apt acquisition, transitioning into larger apartment syndications
- Based in Colorado Springs, CO
- Say hi to him at www.facebook.com/jeremyportorealestate
- Best Ever Book: Emerging Real Estate Markets by Dave Lindahl
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Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, and this is the world’s longest-running daily real estate investing podcast. We only talk about the best advice ever, we don’t get into any of that fluffy stuff.
With us today, Jeremy Porto. How are you doing, Jeremy?
Jeremy Porto: I’m good, Joe. How are you doing?
Joe Fairless: I’m doing good, nice to have you on the show. A little bit about Jeremy – he became interested in real estate while recovering from injury in the United States Air Force pilot training. He has flipped 15 properties in three different markets, including some challenging properties, meth homes, and as you put — Chinese drywall homes; he’ll give us some stories about that, I’m sure.
He owns now 40 doors in three states, including a recent 13-unit apartment acquisition (congrats on that) and he’s transitioning into larger apartment syndications. Based in Colorado Springs, Colorado. With that being said, Jeremy, do you wanna give the Best Ever listeners a little bit more about your background and your current focus?
Jeremy Porto: Sure. Like you said, I got really interested in 2008 when I tore my Achilles’ in pilot training; I had a long time to lay on my back and just read a bunch of books, and probably unlike a lot of people, I was more interested in real estate stuff because I thought it was cool, it was interesting.
Even now you see on TV all the flip shows, and that was going on back then as wel… So I learned a bunch, and I started out pretty slow. I bought a couple rentals, I got a fourplex relatively early on, I started doing some flipping, like you said meth house, Chinese drywall was kind of some of the more interesting ones that I did; also just some cosmetic stuff… I did all that —
Joe Fairless: What is Chinese drywall?
Jeremy Porto: Back in the early 2000’s there were several hurricanes that hit the South-East, and when they were rebuilding everything, there was a shortage of drywall, so they started importing a lot of it from China… And I don’t know if it was a manufacturing defect or what, but when they installed it, it was leeching like a sulfurous compound and making people sick, and the only remedy there was just to kind of rip it all out.
I think it’s kind of passed now, I don’t think there’s really too much issue with it now, because it’s kind of all been figured out and taken care of, but back then it was a real issue, especially in the South-East.
Joe Fairless: And what about the meth house? Were there multiple meth homes?
Jeremy Porto: Yeah, there were, in El Paso County… Don’t quote me on this, but I think El Paso County is the number one or the number two county in the United States for number of meth-affected properties.
Joe Fairless: Is El Paso County in Colorado?
Jeremy Porto: Yeah. It’s Colorado Springs, basically… Just South of Denver. But yeah, I did two of those… I kind of fell into it — so my wife is still active duty, and we bounced around a lot, but I was having a hard time kind of getting into new markets all the time, and I had to relearn stuff… And I found this meth house that was on an online auction, and hey man, I figured nobody else was gonna go for it, so I just learned everything I could in like a couple of days before the auction was gonna start.
I talk to all the remediator guys, I talked to the department that handles the remediation and made sure I was legal in what I was doing… I’m licensed in Colorado for real estate, so I had to make sure I was following all the license law for disclosures, and stuff like that. Those were some pretty interesting properties.
Joe Fairless: What do you have to do to remediate that?
Jeremy Porto: I guess there’s two main steps; one is remediation of the methamphetamine itself, so that comes in two parts as well… There’s removal of anything that’s porous; not that I’d wanna keep it, but things like the carpets – it’s gotta go, because it’s just gonna absorb it. The other big one is popcorn ceilings; they’ll typically absorb the meth, so that’s gotta get all scraped.
After that, the second part of the meth remediation is to clean it. They’ll use industrial chemicals, and HEPA filter vacuums, and they just elbow grease and they scrub it to death… And then you have a third-party tester coming in to make sure that it’s all clean and below the state limits. That’s the remediation side of things. Then it becomes a normal flip like anything else – you put it back together, so whatever you’re left with, which often times isn’t a whole lot, [unintelligible [00:06:32].07].
Joe Fairless: Do you get charged based on per square foot of remediation?
Jeremy Porto: That’s a good question. I’ve worked with a couple different companies, and pretty much they wanna see the initial report that shows you how much meth is in a home. It could be lightly affected if they only smoked it a few times in the house, or light manufacture – then there might not be as many micrograms of meth on the walls and in floors and ceilings… And also just the size of what they have to clean. So when they kind of look at those two things combined, and what do they have to tear out, what do they have to clean, they kind of put a bid together. So really, there’s not a real science to that, I would say; it’s mostly an art.
Joe Fairless: Alright. So I’ve checked the box on the drug topic. I always like to bring it up in every episode, I always like to talk drugs… So now that we’ve gotten that out of the way, 40 doors in three states, including a recent 13-unit apartment acquisition… Over what period of time did you acquire those 40 doors in three states?
Jeremy Porto: I bought the first one in 2008 – that was just a small townhome – with my mom, actually. We were just getting into it, didn’t know anything… Several years later I bought the next one in 2012, on my own, a single-family, and then I just started a kind of exponential increase. I was buying fourplexes, so adding them a little bit faster, and buying two or three properties a year; so that 40 doors is up until now… So in the last ten years I’d say I probably bought two thirds of them, or maybe half of them I’d say in the last 3-4 years or so.
Joe Fairless: Where are you getting the equity for the purchases of the ones that you’ve purchased in the last three or so years?
Jeremy Porto: I’ve been a benefactor of the market, for sure. The ones that I bought early on, obviously — I did some renovations to the rentals, but just the market appreciation was phenomenal… Using 1031’s to kind of save on taxes, finding deals that were below market in the first place… It was one of the first couple of fourplexes I bought – I was in the middle of renovating it, and a guy from across the street said “Hey, do you wanna buy two more?” and I’m like “Well, sure.” They were off market, obviously, so I bought those well below market… So instant equity in that sense. And then just the market has continued to appreciate, and then just using the tax strategies has been really helpful, too.
Joe Fairless: Well, let’s follow the process then… I’d love to hear each of the deals and how you got to today… Because the first one, in 2008, you started with one townhome, and then you waited four years, you got a single-family in 2012… I know it’s gonna be a little challenging just to think of the numbers off the top of your head, but maybe you have them memorized… But can you just go through each of the deals that gets us from 2008 to today, and just when you bought it, and purchase price? Then we’ll go from there.
Jeremy Porto: I could probably think of like a representative property for like a time period, if you will…
Joe Fairless: Sure.
Jeremy Porto: That very first one, the townhome in 2008 – we bought it at 115k, somewhere in that ballpark. That was right at the end (or the beginning), with the crash, so there was — oh my god, there was like five or six bank-owned properties on that street… So it was a smokin’ deal; I didn’t quite realize that then.
Then ironically, we’re selling it tomorrow, we close tomorrow, my mom and I, to sell that, and that is at about two and a half times the price, roughly… And the renovations that we did upfront were fairly basic. Mostly cosmetic – paint, carpet… I think we actually put in new countertops, stuff like that… But pretty basic stuff, and then rented it for the last ten years. So really phenomenal gains there, and leveraging a residential 30-year am loan was great, as well. We were cash-flowing roughly $500 before maintenance/month.
Joe Fairless: So you’re selling it for about 287k?
Jeremy Porto: Yeah. Man, that’s pretty spot on. [laughs]
Joe Fairless: Well, all I did was the math, when you said 2,5 times.
Jeremy Porto: I didn’t actually do the math, so… If that’s exactly 2,5, then that’s pretty cool.
Joe Fairless: Yeah, good job; nice work to you then. I’ll turn the table and compliment you. Okay, so you haven’t tapped into that equity yet from that deal, so that’s even more interesting to me… Unless you did a refinance, or something…
Jeremy Porto: Well, very early on we did.
Joe Fairless: Okay. Did you use some of that money to then buy your 2012 single-family house?
Jeremy Porto: That one was a little complicated, because it was with my mom. I don’t recommend investing alongside people that you’re very close to and you’re very different from. We actually didn’t do that. That refinance was more — we dumped the money back into the renovations, because she’d actually pulled a home equity line of credit out on her own home to fund the renovations and the down payment. I’m not sure now how we did that [unintelligible [00:10:56].05] I don’t know.
Joe Fairless: You bought it for 115k… How much did you all put into it?
Jeremy Porto: About 20% down, and then upfront about 20k or so.
Joe Fairless: Okay, got it. So it wasn’t a huge amount. Okay, so that’s an isolated property. 2012 rolls around, you got a single-family… Was that money that you just saved up?
Jeremy Porto: Yeah, I’m a huge saver, plus being in the Air Force and deploying, you don’t get much time to spend your money… So that’s just money from the Air Force, I saved it all. And because of the timing of that one as well, it was still kind of in the lower part of the market; I was able to snag that for a pretty good deal. That was 92k or so for the purchase price. I put maybe a couple thousand into it, for like paint and just some touch-up stuff, and then started renting that for $500-$600/month.
I’ve just sold that one a couple of months ago for over 200k… So I doubled that one again. Not much of it was renovation; much of it was forced appreciation, it was mostly the market. I did take that one and 1031-ed it. I’ll be honest, I did a couple 1031’s in a row, so I’m not exactly sure where that went… That one went into the 13-unit.
Joe Fairless: Okay, that one went into the 13-unit; we’ll get to that. This is why I wanted to go through it in a linear way, because I wanted to learn how you grew from one townhome with your mom, in 2008, to today, where you’ve got 40 doors in three states, and a 13-unit. Okay, so you saved up money, you bought a single-family house… We’ll still stick to the 2012 timeframe. You then bought some fourplexes, you said?
Jeremy Porto: Right. And let me actually just throw in a comment here, Joe. This is all kind of in the beginning of my real estate career, and I knew a little bit, but I didn’t know a ton… And I always had an exit strategy in mind, but I think the biggest part of this learning process has been flexibility. I may have intended to hold the property for X number of years or whatever, and do something with it, but as the market grew and changed, I just found better ways to implement that money and use it… So I don’t mean it was on the fly in the sense of “I didn’t have a plan, I just did whatever, whenever”, but it was on the fly in the sense that I had a plan, and then things changed and it made better sense to do something else with it.
Joe Fairless: For example…?
Jeremy Porto: That second property in 2012, with my kind of naive mindset, I was like “Oh, I’ll just keep this forever; [unintelligible [00:13:12].08] 30 years and then I’ll have the property paid off.” And as I learned that hey man, if I can leverage the money better, I can do more with it, and the market is going up along with me… Then it made sense to sell that property and get into the 13-unit, because my mindset to get to multifamily – oh man, it was slow and painful. I’m not tooting my own horn — actually, kind of the opposite. I did it on my own, I came to that realization without really talking to people… So if anything, it proves it in my mind that multifamily is great. But it was painful, because first I’m flipping, then I’m doing single-family rentals, then I’m like “Huh, maybe fourplex rentals. That’s the way to go.” So that will tie back into your actual question… And then from there, I’m taking them into something bigger…
I bought the fourplex about a year later, maybe a little less. It was on the MLS, the guy kind of ran it pretty terribly, and in my mind it cash-flowed great… But nobody was buying fourplexes at that time, or nobody was buying a whole lot at that time. I think it was still early 2013 or so… And that has turned out to be a phenomenal deal. That’s also appreciated, and that’s where I’m kind of like “Alright, do I start selling my fourplexes now? Because I really like them, they’re great cash-flowing properties.” On each of them I would say I’m in the ballpark of about $1,000/month cashflow, so I’m like, well, do I take that and roll that into bigger multifamily? If I can find something, I think I will, but right now I’m really liking where those are at.
Joe Fairless: How many did you buy in 2013?
Jeremy Porto: One fourplex, one duplex, and a single-family that I actually kind of sort of house-hacked – I moved in, did some renovations while my wife and I were living there.
Joe Fairless: All of this from saving your pennies from your job and your wife saving her pennies from her job?
Jeremy Porto: Yeah, exactly.
Joe Fairless: Okay. Because so far, following the timeline, you haven’t done a refinance or exited out of anything, so so far at this point you’re just acquiring them, in the timeline… Okay, after you did the fourplex, the duplex and the single-family, what did you do?
Jeremy Porto: Let’s see, that was 2013… So in 2014 I started doing the flipping for the first time; that was the Chinese drywall, that was a duplex. That’s maybe not the biggest mistake I made, but a mistake that I look back and say “Hey, that was a great duplex; I renovated it completely, it was gorgeous, it was renting for way more than I anticipated when I started the project…” I wound up selling that – I think I made 50k or 60k on that one, and that’s kind of the time where I started deploying real heavy with the Air Force, so it was kind of up and down as far as what I was doing at the time.
So I got 50k back in my pocket from a flip, I’d also been collecting cashflow this whole time, and putting away my Air Force savings, so I’m still pretty cash-heavy at this point. 2015 rolls around, and that’s where I kind of ramp up the flipping a little bit. I think I did four that year, in 2015. All single-families. Those were kind of smaller deals, probably about 25k-30k for the profit.
Joe Fairless: How many did you do that year, roughly?
Jeremy Porto: I think it was four that year.
Joe Fairless: Okay.
Jeremy Porto: [unintelligible [00:16:03].16] the cash back into my pocket. Then we start getting into kind of the moving around part of — like I said, my wife’s active duty, and we constantly bounce around at different places… So I wasn’t buying a whole lot of rentals right then, and then it just kind of exploded I would say probably ’16 into ’17 – that’s kind of really when I started buy-buy-buying. Like I said, I bought that other fourplex, where that guy came up to me and said “Hey, do you wanna buy these two?” So that was three fourplexes in the span of four months maybe.
Joe Fairless: And you got that with equity from the flips that you had earned, and the other methods’ income… Okay.
Jeremy Porto: And that does remind me – in there I sold that duplex from 2013, 1031-ed from the one duplex into the two new fourplexes that the guy was selling. That was the moment when I kind of realized, “Hey, it’s not necessarily the best thing to hold onto these forever.” That’s when I started becoming flexible.
I had planned to hold that duplex for a while, but when I saw this opportunity for two fourplexes, and I didn’t have enough money to do the whole thing – at that point I was thinking “How can I do this?”, trying to get creative, and realized “Hey, sell the duplex, take that money – that will cover everything for both fourplexes.” So kind of the appreciation in the down payment that I put into those… And that was when I started including sales in there to then start 1031-ing; that was actually the very first one I did.
Joe Fairless: And when you got the two fourplexes, now you’ve got a portfolio – does that lead us to basically today, where you’ve got the 40 units, where you’ve acquired those units plus the 13-unit?
Jeremy Porto: Yeah, I came to Colorado, started buying some fourplexes here; I do own two or three… I just sold one today, so I’ve lost track of where I’m actually at as of today… But I own at least two here in the Springs now, fourplex-wise. And I’ll be very honest, when I moved here – this goes back to the flexibility – my intent was buy-buy-buy fourplexes. Well, I kind of see that the numbers here work, but they’re not phenomenal, and can I make my money work harder elsewhere? The answer is yes. So I just sold a fourplex today, I just closed on it this morning. I’ve got another one that I’m probably going to list in the next week or so to get rid of, take that money elsewhere… So yeah, I think that kind of brings us to today.
There’s a few more flips, as well… I did a couple of flips here in the Springs… But yeah, it’s a flurry, it feels like, of buy and sell and just reposition to make the money work even harder. There’s a lot of transaction costs, which I don’t like, and that’s part of the reason I got my license, was to kind of help with that… So not only am I making a little money on the buy side with my license, I’m saving a little money on the sell side with my license as well.
Then that led into unintentionally brokering for a lot of people, which I’ve since decided to kind of set aside, because I just think it’s not the best use of my time right now. I need to focus on one thing here… So yeah, flurry is probably the way I would describe the last few years.
Joe Fairless: Yeah, it sounds like it’s really interesting how you’ve maximized the equity that you have, and then rolling into something else. With your 13-unit now, were you able to only use the 1031 from your 2012 purchase to purchase it, or did you have to do some other stuff to acquire it?
Jeremy Porto: Yeah, I had to bring a little bit of extra money, not a ton. That’s a story in itself. I made a little bit of a mistake there with the lending side of things. I was not as aware as I should have been. You know, when you’re under a million dollar loan price, the banks don’t give you the best terms, so I actually had a private lender lined up for that deal. It was gonna be a 90% loan-to-value, a pretty good interest rate – 5,5%, maybe 5,75% – and it was gonna be amortized over 30 years, and I think it was two points… Which, at the time, I was balking at a little bit… But as I realize now, I’ll pay probably close to two points anyways when it’s all said and done.
That fell through at the last minute. I got it under contract, I was ready to move forward… He had actually done a deal for my buddy, very similar. It was 10 units in Panama City; I was near Pensacola with these 13 units, so it’s not like this was something I had made up and was just trying to believe something that wasn’t true; my buddy had done this. It fell through at the last minute, so then I was scrambling that week to find financing to get the deal done, because the property itself and the price itself I thought was phenomenal.
I wound up going through a local bank, and I wound up with a 15-year am, 5,75% interest rate, and I think it balloons at year five… And it just didn’t turn out to be very favorable, really. It was a 70% loan-to-value, so that’s where I wound up bringing the extra money, which you asked me where that came from – I don’t really know right now.
Joe Fairless: [laughs] Yeah, a whole hodgepodge of things… So what was the purchase price of the 13-unit?
Jeremy Porto: 615k. The owners were a kind of mom and pop group of guys that wanted to get into multifamily, so they had mediocre records; that was also a challenge, to kind of pick through that… I think the reason they decided to lend to me — because I had actually gone through (I think it was) four other local banks that said no, and they were saying no only because the records were not up to par.
The reason this lender went with me – I think because the deal itself was pretty good; it was cash-flowing nicely. The expenses were relatively low, I think; there wasn’t a whole lot there… And I think they also just liked it was pretty local to them. I guess they’re more of a regional bank, Centennial.
So put all that together and I had a great property with kind of terrible financing, so I think overall the deal kind of works out to be mediocre. I’m still happy I did it, because I’m in multifamily now; I own a 13-unit apartment complex, and that’s just the stepping stone to get even bigger.
Joe Fairless: How did you find it?
Jeremy Porto: That buddy that I told you about that did 10 units – he found it… On LoopNet, of all places. And he showed it to me, he was like “What do you think? I wanna do it…” and we talked about it for a while… I was all trying to help him get it, and then he on his own came to the realization that he just didn’t have the money for it. He wanted to keep some big cash reserves, and this would pretty much deplete him… So I said “Hey man, look, I’m not trying to steal your deal, but if you think that you’re not gonna do this, let me know, and maybe I’ll try to get in on it.” So that’s how that happened.
I wound up calling the seller, and made the connection, and then it was pretty quick after that.
Joe Fairless: What did they have it listed for?
Jeremy Porto: 650k.
Joe Fairless: 650k, and you got it for 615k… Why do you think it was on LoopNet? Because the perception is that if something is on LoopNet, then it’s not a good deal, or something’s off about it.
Jeremy Porto: So as I said, these guys were your sort of mom-and-pop(ish) type owners… I just don’t think they were super-versed in how to dispose of a property in the best way possible… So they were thinking “Hey, we’ll save a buck by not dealing with a broker. We’ll just put it on LoopNet”, which they don’t realize — it has a perception that it does… So that’s how they wound up there.
Now, I don’t know this for a fact, but he was telling me several other guys called him, and that could have just been him drumming up the interest, but… My thought is when I see the expenses, when I see the income, when I see the upside – because that was the other piece that was pretty big for me… I’ve got probably about $100 to $125 of upside in rent increases, and that’s without really doing anything. These units aren’t in phenomenal condition, but they’re good enough right now; they’re average, I would say.
Here was the other lucky part – it was right in the market that I had spent about 8 or 9 years in for the Air Force, so I personally knew that area very well, knew exactly what it was… So when I say there’s $100-$125, that’s from personal experience and knowledge, and having fourplexes there and rentals there already, and knowing that market. So that was the other piece of it, that I really knew the upside.
Joe Fairless: $125 without really doing anything is pretty darn incredible. Sign me up for that too, that’s for sure. Usually we have to put in like $5,000 into the unit in order to do that. Based on your experience, what’s your best real estate investing advice ever?
Jeremy Porto: I was saying this too, and I hear it a lot, that there’s no deals out there… I think my best advice to the Best Ever listeners is don’t be afraid to do the deals that no one else wants. When I moved in Colorado Springs and couldn’t find deals, that’s how I got into the meth house flipping. If you learn that niche well – or any niche; it could be marijuana grow houses, it could be the Chinese drywall, it could be foundation issues… If you learn that and become the expert, people are going to bring those deals to you.
When I was doing the latest meth house, I got on a local news station, they did a piece on me, and from that I got a lot of calls, and people saying “Hey, I’ve got this house, it’s meth-affected”, so I got to be known somewhat – some will use the term “expert” – in the meth house area, so people come to me for that.
The spreads are gonna be bigger, because people don’t understand the property, they’re gonna discount it more than they really should be, because it’s unknown and scary… So I can bid realistically on these places without lowballing fear, and then I get the deal; that’s the ultimate thing, to get the deal, because everybody’s complaining there are no deals.
Joe Fairless: We’re gonna do a lightning round. Are you ready for the Best Ever Lightning Round?
Jeremy Porto: Sure thing.
Joe Fairless: Alright. First, a quick word from our Best Ever partners.
Joe Fairless: Best ever book you’ve read recently?
Jeremy Porto: You threw me off on that one… [laughter] So let’s go with Emerging Real Estate Markets, David Lindahl. I’ve read a ton about how to buy real estate and all that stuff, but the market itself and knowing about the market I think is really pivotal, so I’ll go with that.
Joe Fairless: Best ever deal you’ve done?
Jeremy Porto: I bought a fourplex here in the Springs, I did a little arbitrage action… I bought it from a Springs seller, sold it to a Denver buyer about an hour away, right off of I-25, the North-South highway that runs between us, and netted 80k without doing anything to the property.
Joe Fairless: What’s a mistake you’ve made on a transaction?
Jeremy Porto: Probably what I mentioned before — well, it was not quite on a transaction, but… Having my license and using it to broker deals – if I wanted to be a broker, that’s great… But that was not the best use of my time. I can do things that are value-add in a better way.
Joe Fairless: Best ever way you like to give back?
Jeremy Porto: Definitely sharing my knowledge. There was a guy that joined my squadron after I left, so I never met him… He reached out to me through a buddy, told him all I knew and everything, and that guy today owns like 20 or 30 doors; I’ve partnered with him several times… It’s just awesome to see. The fact that I was willing to share my time with him, and where he’s at now, it was pretty awesome to see.
Joe Fairless: How can the Best Ever listeners learn more about what you’ve got going on?
Jeremy Porto: The Facebook page – I put a lot of my real estate activities on there. Facebook.com/jeremyportorealestate. Or they can e-mail me, email@example.com. If you’re thinking about getting into real estate, or you just wanna talk about the stuff that I talked about today, reach out to me; I’d love to talk to you.
Joe Fairless: I loved to hear how you went from 2008, buying a townhome with your mom, to today, 40 units, three states; you’ve just bought that 13-unit, you found the 13-unit on LoopNet, and how you got into that from a financing standpoint… And as you said, it’s been a flurry of transactions. You’ve constantly been assessing the equity that you have in deals, and then seeing how you can leverage up into those deals.
I was on a call with a potential investor — I get potential investors e-mailing me, and then I follow up when and we have a phone call before they invest anything, so we can know each other… And he said he was following the Dave Ramsey advice for two decades – or however long; I don’t know how long he was following it, but he’s been investing in real estate for three decades… So he was paying off his homes and things, and he had followed it up until (I think he said) 2012. Then he realized that he wasn’t on the right side of the tax code after that, and he wasn’t leveraging up. He was talking about it more from a tax liability standpoint, that’s why he was looking to invest in apartment syndications… But it’s also what we didn’t talk about in that conversation – he and I didn’t talk about – leveraging up and using debt as your friend, and to continue to optimize your portfolio along the way, versus just paying things down, and that’s exactly what you’re doing.
I really enjoyed hearing your approach, and how you got to where you’re at, and the period of time in which you’ve done it. Thank you, by the way, for everything that you were doing for our country, and your wife is doing for our country; I really appreciate it. I hope you have a best ever day, and we’ll talk to you soon.
Jeremy Porto: Definitely, Joe. Thank you. Have a good one.