Hayden Harrington was tired of the meet-ups he kept attending. They were usually hosted in crowded, hard-to-hear areas where it was difficult to effectively network with people. That’s when he decided to create his own, unique events. In this episode, Hayden shares how he broke from tradition and created a successful in-person and online networking group.
Hayden Harrington Real Estate Background
- Real estate entrepreneur focused on large-scale multifamily syndications
- Currently has $30MM AUM and actively growing the portfolio
- Managing partner at Momentum Multifamily, a commercial real estate group focused on buying institutional quality assets for their investors
- Based in Richardson, TX
- Say hi to him at: www.momentummultifamily.com
- Best Ever Book: The E-Myth Real Estate Agent by Michael E. Gerber
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TRANSCRIPTION
Joe Fairless: Best Ever listeners how are you doing? Welcome to the Best Real Estate Investing AdviceEver show. I’m Joe Fairless. This is the world’s longest-running daily real estate investing podcast where we only talk about the best advice ever, we don’t get into any fluffy stuff. With us today, Hayden Harrington. How are you doing Hayden?
Hayden Harrington: I’m doing well. Thanks for having me on, Joe.
Joe Fairless: I’m glad to hear that and it’s my pleasure. A little bit about Hayden. He’s a real estate entrepreneur focused on multifamily syndications. His company has $30 million of assets under management. He’s a managing partner, speaking of his company, at Momentum Multifamily, based in Richardson, Texas. With that being said, do you want to give the Best Ever listeners a little bit more about your background and your current focus?
Hayden Harrington: Sure. Thanks again for having me on. Like you mentioned, based here in Richardson, which is a suburb of North Dallas. I’ve been here for about eight years now. I’m originally from the Woodlands, Texas, down on the North side of Houston. That’s really where I got my start in real estate, doing actually fix and flips and rentals with my dad, growing up through my teenage years. That’s really where I was exposed to it and first got a taste for it. But ultimately, through doing some rehabs and flips with him, it kind of opened my eyes to wanting to go bigger. Obviously multifamily was that next natural step. It took me a while to kind of figure out how the game is played and how it works, but I finally landed that first deal earlier in January 2021. We currently got our second one under contract and are set to close actually next month. So we’re excited.
Joe Fairless: Congratulations on all the above. You said it took you a while to learn how the game is played. How long did it take and what did you learn?
Hayden Harrington: Good question. It really took probably four or five years. I started really setting my sights on the commercial side of things around 2016 or 2017. At first, I wanted to do everything myself, because that’s really all I was exposed to. On the single-family stuff, it was just me and my dad doing all the work ourselves. That’s really all I had ever seen, is just “We’ve got to do it ourselves and make things happen.” So for a long time I had that dream of I want to get into commercial, I’m going to find that one investor, he’s going to write me a million-dollar check, I’m going to go out and buy a commercial property, and I’m going to be off and running. That dream got me nowhere.
It was a lot of trial and error for a while, just understanding the reality of the commercial real estate space and educating myself on the different niches, like where I wanted to start… Because there are so many different places that you can start, whether that be development or buying existing multifamily, buying office, triple net commercial, and so forth. So I spent some time really just exploring and talking to people on each of those areas, and ultimately set my sights on multifamily.
From there, again, you have more challenges that you’re presented with and how to get a seat at the table of a syndication or become a general partner. There’s definitely a learning curve involved with that. For a long time, I knew proximity was power, I knew I just wanted to be around people doing deals… So I’d meet somebody that’s experienced and I’d offer “Hey, I’ll work for free.” I just want to be around the people that are making deals happen, because I knew that was the fastest way to learn. A number of doors actually closed on me, and nobody would accept that offer from me for a while, and I was kind of scratching my head like “Man, I’m smart and capable. What am I doing wrong here?” It wasn’t until I really put myself in their shoes and looked at it from their perspective of what I was actually offering when I had my lightbulb moment.
When I did that, I realized that what I was asking for was not offering them value. It was offering their time and resources and energy to educate me so it really wasn’t a great deal for them. Until I looked at it from that perspective, I really wasn’t making a whole lot of progress and I was just dealing with a lot of frustration.
So I began to look at it from a different angle and a different approach. I said “Okay, in my mind, what are the things that are going to speak to a syndicator or somebody that’s experienced?” The two things that popped up were deals and capital. In my mind, those were the two things that were actual tangible value to get a seat at that table. I knew finding a deal would be extremely difficult, especially when you’re just starting out. It’s hard to even know what a deal is, honestly. And if you’re looking at everything on LoopNet or Crexi, there’s a reason why most of those deals are there. So the good deals really are only sent to those that are experienced. A broker is not going to waste their time on somebody they’ve never heard of. I knew that, and so I really set my sights on the capital side, that’s ultimately how I was able to bring some skills to the table and get a deal done.
Joe Fairless: When you were originally looking for a deal by yourself, what type of deal were you looking for?
Hayden Harrington: Honestly, I was just scouring LoopNet and Crexi, those online sites, just trying to make sense of it. Like I said in the beginning, it was kind of looking at different types of assets but I wasn’t getting anywhere else. I was trying to make some relationships with brokers and so forth, I tried to make my own underwriting model, and a lot of it wasn’t great. So after not making a whole lot of progress, I just kind of discarded that idea. I said “Hey, I need to actually go and fine-tune this strategy, get around people that are actually doing deals so that I can be pointed in the right direction.”
Joe Fairless: Got it. Whatever the property type ended up being by yourself, how were you planning on funding it?
Hayden Harrington: Like I said, hopes and dreams of having some investor believing me enough to write me a big check. But obviously, that didn’t get me anywhere, so that was not a great approach.
Joe Fairless: Fair enough. Alright. You got the first deal in January 2021. What was it?
Hayden Harrington: It was a 228-unit property in North-East Houston. A property built in 2012. It was formerly called [unintelligible [00:06:08].18] Liberty Hills and we rebranded it as the Henry at Liberty Hills. It’s kind of our brand that we wanted to stamp down there in Houston on all the properties we buy down there. We bought it for just shy of about 30 million, 828 a door. We actually got it at a five cap, so looking back, we feel pretty good about that, especially where things are at now. But really kind of interesting, just to wind it back, my partner, Dustin and I, we’ve been teamed up for about three years now.
Joe Fairless: How did you meet Dustin?
Hayden Harrington: Just in my own educational process, and trying to understand how the game was played, I started networking. Like I said, I knew proximity is power, and I want to get around people. That was kind of my approach, to add value. I ended up meeting, Dustin and I threw out an idea. I said, “Hey, what if we start a networking group here and kind of make it a little different to help us stand out?” In that way, I can not only put him in a good light, but also, we can work together to build an investor list, or in other words, a pool of equity that we could potentially pull from when that deal eventually came. So we started working together in early 2019 and did the meetup for a little over a year until COVID shut us down… But we were getting 100 plus people out every month. That’s really how I was able to kind of get my name on the map, and we built a pretty sizable database from it.
Joe Fairless: That’s awesome. Let’s talk more about that. But just so I’m clear on where you met Dustin – you said networking, but what specific networking event did you meet Dustin at?
Hayden Harrington: There was a networking app, it’s called Shapr. We connected there and then I just threw it out. I was like, “Hey, can I take you out to lunch?” The app is kind of similar to LinkedIn, and I saw that he had experience in multifamily. I said, “Hey, I want to take you out to lunch if you have some time.” I just want to ask some questions. I think it was on our second lunch that we did that, because we kind of hit it off and got along right away. That’s when I threw the idea out there. I was like, “Hey, what if we start this networking event together?”
And honestly, that was a challenge for me because growing up, I was very introverted and very shy for a long time. I knew throwing that idea out there. I was like, “Oh, man. If I’m co-hosting a networking event, I’m going to have to speak in for all these people.” Honestly, I went back and forth in my mind whether or not to bring it up. I’m grateful I did, looking back, because so much has come of it. I think that’s a product of what happens when you take those chances, you take those risks, and you kind of believe in yourself. Because if not, a limiting belief that I held within my mind keeps me from achieving my goals. That’s when I was like, “You know what? Screw it. I don’t care how it goes. I’m going to throw this out there and put forth as much effort as I can and see what happens.”
Break: [00:08:45] – [00:10:18]
Joe Fairless: With that meetup, clearly, it was successful with 100 plus people shortly after you started it. You said you wanted to do something different. Tell us, what did you do?
Hayden Harrington: A couple things. Like I said, I was going around to different events too, just trying to understand how the game is played. I realized that the people that were putting the events on were the ones that were doing deals. That was a big realization for me. But the problem I saw was all these events were done at restaurants, bars, and crowded hard to hear places. They didn’t have a sophisticated way of checking people in, it was kind of a table that you do it yourself. I started to see all these things as opportunity. I was like, “I don’t have the best handwriting. I’m sure a lot of people out there don’t either. One simple thing, when you’re putting in your database, you put one wrong letter in an email address, that’s a lost lead.” So doing stuff like a digital check in where we had a computer or an iPad that would be on the backside of a website that I built for us that would automatically add people to a CRM. Just trying to minimize the room for error, maximize efficiencies, and then also doing automated follow-up emails from the time that they submit that form. Two hours later, when the event is over, and they’re getting home, they’re already getting hit with a follow up thank you email.
Then a big thing was putting them in an environment that will help them network, getting them out of the restaurant, that was my number one criteria. I said, “We’re not doing it at a restaurant, we got to get it out of that.” Because the problem with that is you sit down at a table and you’re locked in that seat. You’re talking to the guy to your right or your left and that’s where you spend the next hour and a half. That’s a major issue when you’re trying to build your network. We said we’re done with restaurants. We started in a title company’s office up here in Dallas actually, Madison title. They were gracious enough to open up their office after hours, they actually catered food for us. It was great. Then to further that too, again, like I said, I was kind of naturally introverted. I wasn’t the best at networking. So I basically just solved the problem for myself, which was, we called it a graceful exit. Trying to get out of conversations can sometimes be very difficult when you’re networking because you don’t want to come across as rude.
We’ve essentially just addressed that problem that everybody’s thinking. Every 10 minutes, we force people to mix it up, we actually would bring a cowbell and that was their signal. Okay, times up, exchange business cards, go meet somebody else. People loved it. The first meetup, I think we had 20 to 25 people, then it was 45, then it was 70, then it was 100 plus. It grew very, very quickly. Essentially, we just wanted to help people network more efficiently. That was really the only problem that we were solving.
Joe Fairless: That digital check in, is the attendee the one putting their info into the iPad?
Hayden Harrington: Yup, absolutely.
Joe Fairless: Describe the flow of the event will you, from the moment you go in to when you leave. As an attendee, what am I experiencing as far as content and different setups that you have structured?
Hayden Harrington: We eventually moved it to the Westin in Las Colinas here in the mid-city. It was a big conference room in a nice brand-new hotel. We’d have them come in and check in outside the room that we’re holding it in. Then we had somebody writing down their name tags. Everybody’s name tag was all in the same font, it’s clear and legible.
That’s another problem too that we solved, because sometimes it can be just hard to read people’s names and their handwriting. So we had somebody with good handwriting writing down their name tags, they’d be checking in, then they’d go and network for a little bit. We kind of introduce ourselves up on stage and some sponsors that we had. We then let people network for the next hour, rotating every 10 to 15 minutes. We gave them free food so there’s always food and drinks. Then the second hour of the event, we do a speaker. So we’d have the speaker come in, and we had Michael Becker come one time, James Kandasamy, John Montero. We had a bunch of pretty well known, especially around Dallas, people that would come and speak on different topics. You get kind of the best of both worlds. We’re not sitting down for two hours and just giving you a presentation, but we’re allowing you to connect with some people, and then also giving you some education to take home as well.
Joe Fairless: What’s the cost, if any, to attend?
Hayden Harrington: It was always free. We gave people free food and it was free to attend. That’s one thing. We didn’t want to put a price tag on it because honestly, we wanted as many people as we could possibly get out. So we left it free for people and I think they really appreciate that.
Joe Fairless: How would you promote it?
Hayden Harrington: Mainly just through social media, honestly, and Meetup. That was kind of our big avenues to promote it. Not anything special really. Once they’d be signed up, we’d obviously send reminders and stuff like that. I think that’s a big one just because people get busy. We were only doing it once a month so sometimes you put it on your calendar, or you register for something, and you kind of forget about it. So we made sure to send people reminders and make sure that they knew when and where it was.
Joe Fairless: How often would the reminders be?
Hayden Harrington: Normally we do a week before, then morning of, and then kind of like an hour before reminder. We do typically three, maybe four reminders kind of leading up to the events.
Break: [00:15:36] – [00:18:29]
Joe Fairless: You had a lot of people and then COVID hit. So now what are you doing with that Meetup?
Hayden Harrington: We transitioned to do a lot more online stuff. I think that was a big pivotal moment too because a lot of people, as soon as COVID hit, especially in our space, they just kind of stopped doing stuff. A lot of people had local meetups and they never really made the transition online. We started doing webinars and online networking events. We actually were able to build our list significantly faster than we were before and also expand our reach. We pivoted very quickly and just started doing monthly educational webinars, we do bi-weekly networking events with people all over the country. I think the first few months, we were getting at least double or triple the amount of people added to our list just because we could expand our reach. Especially up front, everybody was excited to hop on different network events. There was some definite Zoom fatigue over the subsequent months. But really, at first, we were getting at least twice if not three times as many more contacts added to our list every single month.
Joe Fairless: Now are you still doing those Zoom networking events?
Hayden Harrington: Absolutely. We just finished up a three-part series. We did kind of lifecycle of a deal. We did one video in the series per month. The first one we did, Dustin and I were on underwriting, then Gary Lipski came on the following month and did asset management webinar to our audience, and then Rob Beardsley of One Star Capital just recently did a case study on a full cycle transaction. Then we still do the every other week virtual networking on Zoom as well.
Joe Fairless: Are you doing this full time?
Hayden Harrington: Yup.
Joe Fairless: What’s been the biggest challenge? Actually, before you answer that, you were learning for four to five years how to approach getting a deal. How are you supporting yourself?
Hayden Harrington: Out of college actually, I started a nutrition company, did that and grew that for a few years. Then when I exited that, that’s really when I went all in on multifamily. I definitely had to make some sacrifices too because I knew in my mind, it’s the coffees, it’s the lunches, it’s those meetings that are spontaneous where all the value is found. If I was tied up too much, I’d miss out those opportunities, and I didn’t want that. So I had to do things like sell my car and just go all in on this bet on multifamily. I think that definitely paid dividends. But it’s very challenging to get off the ground because the barrier to entry is very high, especially for somebody that’s young. I definitely had to make some sacrifices along the way.
Joe Fairless: When you sold your car. How did you get around DFW?
Hayden Harrington: I drove my grandfather’s old Jeep around for a couple years. Thankfully I had that. But that kind of afforded me the ability to go and make that sacrifice. Not everybody has something like that. Thankfully I did and was able to go forward with that.
Joe Fairless: What did do you do with the money when you sold the car? Where did that go?
Hayden Harrington: Straight into savings. I have little savings, plus proceeds from that, did a couple of little jobs, and stuff. But that was all into savings, just try to keep myself afloat and keep the dream alive.
Joe Fairless: Wow, good for you on that nutrition company. What did you sell it for?
Hayden Harrington: I’m not able to disclose that but it was a good venture. We ended up growing it into about 90 different stores across eight different states.
Joe Fairless: A seven figure sale to you.
Hayden Harrington: Not quite, but we didn’t know…
Joe Fairless: Pretty healthy.
Hayden Harrington: Yeah, it was still a good business. I credit that business a lot because it actually taught me a lot. Especially the marketing and branding side because at first, frankly, we were broke. So I had to figure out how to build a website, how to design a product, all that stuff I had to kind of take on myself. A lot of those skills translated to real estate because a business is a business, ultimately your investors are customers and the same principles apply to selling a product as selling an investment.
Joe Fairless: If you speak to someone who says “Yeah, I want to get into multifamily,” but they were where you were years ago. What’s something you would tell them to do less of that you did and what’s something you would tell them to do more of that you did?
Hayden Harrington: I’d say don’t try to do it all yourself. Because for a long time, that’s what I tried to do and it got me nowhere. Be willing to specialize, be willing to focus on where you can add value, and not try to do it all. Multifamily is absolutely a team sport. Focusing on a role that you can be really good at and bring a lot of value to the table, I think that would definitely serve you well in the long run. Just to add to that, just be patient. These are long relationships, not only with the partners that you’re in, but also the properties, the deal itself. It’s not like you’re flipping these in a month, we underwrite to five year holds, so these are long term transactions, they take time to put together. I mean just the closing process could take two or three months, and that’s from getting your offer accepted. That doesn’t even factor in how competitive the space is. Just be patient, be willing to put in an enormous amount of effort and work, and good things will happen
Joe Fairless: Based on your experience, taking a step back, what’s your best real estate investing advice ever?
Hayden Harrington: I think my best piece of advice really goes back to just believing in why you’re doing this. What’s your why to begin with? I think that’s the most important question to ask yourself is what’s your purpose behind that? Because you’re going to face a lot of closed doors, you’re going to face a lot of hurdles, a lot of objections, and your why’s are what’s going to keep you going. Having that the center of your focus, and having a lot of clarity around what that why is, I think is the best advice I can give.
Joe Fairless: We’re going to do a lightning round. Are you ready for the Best Ever lightning round?
Hayden Harrington: Yeah, let’s do it.
Joe Fairless: Best Ever book you’ve recently read.
Hayden Harrington: That’s a good question. I really liked the E-Myth. I read that one recently. It kind of ties into what we’re talking about here as well.
Joe Fairless: Best Ever way you like to give back to the community.
Hayden Harrington: The best way to give back is we’ve actually done some charity events and that’s something we’re really excited about within Momentum Multifamily. It’s continuously giving back to not only our investors and getting them involved, but also the community as well.
Joe Fairless: How can the Best Ever listeners learn more about what you’re doing?
Hayden Harrington: Check out our website momentummultifamily.com. Feel free to reach out at hayden@momentummultifamily.com as well.
Joe Fairless: Hayden, bravo on what you’ve done. Thank you for sharing your story. I know it will be inspirational and helpful to a lot of Best Ever listeners who are starting out especially in commercial real estate. Thanks for talking about at the Meetup, how you positioned it differently, proved upon the experiences that you had attending other Meetups, and are enjoying the results of those improvements with a lot of people attending. So nice work on that. Thanks for being on show. Hope you have a Best Ever day and talk to you again soon.
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