December 14, 2021

JF2660: 3 Ways to Pitch to Partners With Little CRE Investing Experience with Brock Mogensen

Brock Mogensen went from completing one house hack to an 89-unit syndication. Self-taught and with limited commercial real estate investing experience, Brock was able to successfully pitch himself to partners. In this episode, Brock details how he crafted his winning pitch and the lessons he’s learned diving headfirst into CREI.

Brock Mogensen Real Estate Background


Click here to know more about our sponsors:

Deal Maker Mentoring

Deal Maker Mentoring




Follow Up Boss




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, Brock Mogensen. Brock is joining us from Milwaukee, Wisconsin. He is a full-time real estate investor and has 10 million dollars of assets under management. Brock has also been syndicating deals for almost three years. Brock, thank you for joining us and how are you today?

Brock Mogensen: Doing well. Thanks for having me on.

Ash Patel: It’s our pleasure, man. Thanks for being here. 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?

Brock Mogensen: Definitely. I got started in real estate a little over three years ago. I started with a house hack, so I bought a duplex, lived in one side, rented out the other, fell in love with everything about real estate, and decided this is what I want to do, I’m going to scale this and make it my full-time thing. From there, I got into syndication, spent some time learning the underwriting side. That was kind of my focus, it still is, and partnering with the right people. About a year after I bought the duplex, we syndicated in 89-unit deal, and have gone on to do five or six more since then. It’s been amazing. In that time, I was able to leave my W2 job and now I just focus 100% on investing in real estate.

Ash Patel: Man, that sounds easy. Hold on, let’s dive into all this. What were you doing before your house-hack? Or what was your full-time job?

Brock Mogensen: I was in a few different roles. I was in marketing, then I was in IT for a while; most of the time it’s like in an analyst-type role. I did have some skills that transferred over. I learned how to use a spreadsheet and kind of the analytical side of the business. Some of those skills transferred over, but nothing in real estate related in my W2.

Ash Patel: What prompted you to start house hacking?

Brock Mogensen: As I grew up, my dad owned two duplexes. Both my parents worked very blue-collar jobs. Growing up, I kind of saw just the power of simply owning four units, the cash flow from four units, what that can change your lifestyle. So it was kind of just ingrained that I was going to buy a duplex out of college, save up some money, and buy a duplex. I never really had the thought in the beginning that it was going to turn into what it is now, but that initial thought of just simply buying one property was always on my mind.

Ash Patel: So you never meant to scale it, it was just to provide some additional income.

Brock Mogensen: Exactly. In the beginning, it was more, I kind of just thought maybe I’ll buy a couple of duplexes throughout my life. But after that first deal, I fell in love with real estate and everything it provides, and I realized I got to go all-in on this and make it big.

Ash Patel: And then a year later, an 89-unit syndication. Give us the details of how that came together.

Brock Mogensen: My thought process was when I initially started researching syndication, there’s a ton of different stuff that goes into syndicating a deal. I knew I didn’t have the net worth, I didn’t have all the money, I didn’t have the investor base, I didn’t have a lot of these big pieces of the puzzle. So I figured, let me learn one piece of the puzzle, then I’ll go out and find partners that might be looking for someone on that piece, that is strong in the other areas. Underwriting, naturally was kind of where I spent some time learning. Once I became proficient in there, six or seven months later, after just doing everything I can, practicing, looking up as much content as I could, I went out, and networked a ton, I connected with one partner that had the same kind of mindset as me, then he brought on one of his other buddies that had much more experience and had been doing it for a while, he just hadn’t syndicated anything… And us three kind of just went from there and did that first deal. They brought the capital, they brought all those connections, and I was more on the analysis side. Since then, our partnership has gone great, we’ve done a ton of deals together, and now I kind of take part in the whole process now. But initially, it was a lot. I figured let me just learn one piece, instead of trying to learn everything in the beginning.

Ash Patel: Alright, you’re doing it again, you’re making things sound easy. Let’s dive in a little deeper. You said “when I started looking into syndications”, what prompted you to look into syndications?

Brock Mogensen: Really, it was this concept of wanting to go bigger. I realized that the way I was going to scale was by going after bigger deals. And obviously, the first thought is I don’t have an expendable couple thousand dollars each year to go out and buy a big apartment building… So I came across this concept of syndication, leveraging other people’s money to go after bigger deals, and just taking a piece of the pie, instead of the whole thing. I came across this subject, it caught my attention, and I realized this is the way I’m going to scale. I’ve started thinking about how do I get into this personally, with my skill set and what I have to bring to the table? What is the way I can get into this?

Ash Patel: Brock, how did you educate yourself on syndications?

Brock Mogensen: It was really just a ton of podcasts and books. I listened to this podcast quite a bit, just going out and finding everything I could out on the internet. I did a few small courses, but never really got into one of the larger mastermind groups… But it was really just going out and putting all the pieces together and pulling information from everywhere I could. There’s so much essentially free information out there just through podcasts and books for people. If you really are dedicated, you can learn it.

Ash Patel: Was part of your to-do list “find partners”?

Brock Mogensen: Yes. Initially, I just wanted to spend some time just learning. Before I started going out and searching for partners, I figured let me at least have an idea and kind of know what I’m talking about before I started sitting down with these people. But as soon as I became pretty confident and understood the process — I was going out and networking a ton and just telling everyone what my goals were. After a while, I connected with the right person and everything went from there.

Ash Patel: Brock, what did you bring to the table? Because you’ve done a house hack, why am I going to partner with you on a syndication?

Brock Mogensen: It’s a great question. It was really me selling these two partners that had much more experience than me that I was going to put in the work. I did all the analysis on the front end, so I was able to talk through, show what I knew on the front end, and then lay out what I was going to bring to the table throughout the entire deal. I took on a lot of the investor reporting, and a lot of the admin duties in the beginning that they saw value in bringing on someone. So you’re totally right, as someone who’s coming into it with just a duplex and not much money in the bank, it’s kind of hard to sell someone that has several hundred units on becoming a partner with them. It’s really obvious you’ve got to learn the ropes first, and then you just got to learn how to sell yourself.

Ash Patel: I love that, man. You did it. You educated yourself and you made it happen. You got the partners, you talk the talk, you put the work in, and did the grunt work, I’m sure in the beginning. What a great recipe for success. So what was your first deal, the first syndication?

Brock Mogensen: The first one was 89 units, a class C apartment in Milwaukee. That was the first big one that we did. There were definitely some learning lessons in there, but it was a good first deal to start out with.

Ash Patel: Is this a deal that the three of you did together or was in the works when you came into this partnership?

Brock Mogensen: Kind of in between. It was a deal that we were looking at for a little while, it fell out of contract, so we all kind of had our eyes on it. But they ended up getting it under contract and I came aboard right after they got it under contract. So it was kind of a mixture. We all kind of understood the deal, but it was just like we were talking about — I had to sell myself on how I can get on the GP team.

Ash Patel: And you spearheaded the underwriting?

Brock Mogensen: Correct.

Ash Patel: How the hell did you learn how to do that?

Brock Mogensen: It was a lot of mostly just practicing. You’ve got to learn the basics of what’s NOI and how to categorize expenses, all that fun stuff. But once you have that base knowledge, you can go buy a spreadsheet online from one of the operators, or you can build your own. But then I’d literally go on LoopNet every day, I’d find a deal that was in the size range I was looking at, and I would just plug numbers in, try to analyze it, some questions would come up, I’d do some Google searches, and there’s a lot of — practicing is the best way, like anything I know; like sports or anything else. The more you practice, the better you’re going to get. So pull deals and just try analyzing and see what happens.

Ash Patel: Just pure hustle and grind.

Brock Mogensen: Absolutely.

Ash Patel: Were your partners pretty impressed with what you were doing?

Brock Mogensen: Yeah, I think on the front end I definitely spent a lot of time really diving deep into everything to show my value, to show my analytical side, and what I was going to bring to the table. Both my partners are more on the sales side, so I think they saw the value in bringing on someone that’s analytical. Those are really the best sort of partnerships that are created. But it worked out.

Break: [00:08:14][00:09:47]

Ash Patel: How much did you lean on them for questions? Or did you try not to bother them?

Brock Mogensen: I definitely had a lot of questions. I had all the book knowledge, the podcasts, all that stuff’s great and useful, but it’s a lot different than actually doing it. Actual experience can’t be replaced by anything, no matter how much knowledge you have. The best knowledge is learned by actually doing it. Yeah, there was a ton of stuff as we were going through the process, and after we bought the deal. Some basic stuff, that looking back on it, I didn’t even know, that I was kind of just learning as I went. I had that front-end knowledge. But having partners that already had done these deals and bought big apartment complexes, being able to ask them questions… And the more deals we’ve done, it’s always a learning process. You never stop learning. It’s just a matter of asking the right questions and making sure you understand stuff.

Ash Patel: Brock, do you remember the numbers on that? The purchase price?

Brock Mogensen: Yeah, we were at about three and a half million purchase price.

Ash Patel: Class C. So what was the renovation amount?

Brock Mogensen: We ended up renovating most of the units. That was one of the learning lessons we had on the first deal, was always put more money in your reserve account than you think you’re going to need. We ended up having to pull from cash flow to do some of it, we ended up doing more renovations than we thought, we didn’t quite budget correctly… So that was definitely one of the learning lessons on that property. Now whatever amount we think it’s going to cost for rehabs, reserves, and tenant improvement costs all that stuff, we throw in an extra 20% to 30% in there just as a safety net. Because when you’re holding these deals for five to 10 years – that is usually how long you’re going to hold these types of deals – something in your proforma is going to go wrong. There’s always going to be some water heater you didn’t account for, or something in the roof, there’s always going to be something. COVID comes and you get 10% of your tenants who don’t pay rent; there’s going to be hurdles along the way, so I’d rather have that safety net in there. If you don’t use it, you just give it back to investors at the end.

Ash Patel: So that 20% to 30% buffer comes from investors.

Brock Mogensen: Correct.

Ash Patel: So you’re paying the returns on that money that you’re holding. Can you return that early?

Brock Mogensen: It’s a good question. We haven’t done that yet. We do have some properties where we have a ton in there, and we haven’t used any of them. Potentially, I think we’ll look at that as we get further down the road and if it gets to a certain point where it makes sense to distribute back. But so far, we’d rather stay on the conservative approach and just avoid having to do any capital calls. That’s the worst-case scenario really in syndication is having to go back to investors and ask for more money. So our thought process is we’d rather just have it sitting there, and if the numbers work based on that amount of capital being contributed, then there’s no harm in just letting it sit there.

Ash Patel: Yeah. And in terms of dealing with investors, did you move into that role? Do you interact with investors? Do you try to get new investors on deals?

Brock Mogensen: Yes. I’ve definitely had more and more deals that I’ve taken part quite a bit in the capital raising, and then I do all the investor reporting, so I’m putting together reports every month to send to investors, and tracking the financials. So I take part quite a bit on the asset management side as well… As well as my partners; we’re all kind of contributing to all aspects of the deal.

Ash Patel: Do you attract investors yourself?

Brock Mogensen: Yes.

Ash Patel: How do you do that?

Brock Mogensen: I try to do more and more on marketing, social media, email lists, and networking events, doing everything I can. I’d say our biggest source of investors has been from networking events. We started a meetup here in our state; it’s grown to be pretty big, and we’ve attracted quite a bit of investors through that. We’ve put quite a bit of time into marketing those events, to just bring in as many people as we can into our funnel, let them know what we’re working on, and see if they’re interested.

Ash Patel: Brock, what’s a hard lesson you learned about interacting with investors?

Brock Mogensen: That’s a good question. I think really just being upfront with investors and letting them know where you’re at and not exaggerating things. We’re very upfront about some of the learning lessons we’ve had on deals; we don’t try to hide stuff. We’ll lay it all out there and say, “This is what we’ve learned. We made some mistakes here.” We’ll kind of show some performance on some of our other deals. I think being transparent with investors is the biggest thing instead of trying to hide the stuff that they’re probably going to find out anyways. Be transparent on the front end, and I think that goes a long way in building rapport.

Ash Patel: What’s a hard lesson you learned about having partners?

Brock Mogensen: I’d say dividing work sometimes and figuring out what everyone’s strong suit is. I think the best partnerships are all these people that have different strong suits and kind of come together to create this partnership. If you can divide certain tasks to say “You’re better at this task, I’m better at this one. Let’s just kind of take these paths and go.” Sometimes that can get challenging, because there can be certain tasks where maybe you both think you should work on, but it’s better to just have one person. I think that’s always going to be a struggle, is defining those roles. Eventually, when you get to a point when you can start hiring employees, you can delegate more of those tasks, I think that becomes easier. But on the front end, that can get difficult sometimes.

Ash Patel: Have you read the book Who, Not How?

Brock Mogensen: No. I’ve heard of it though.

Ash Patel: Alright. So if you have partners that have the who not how mentality where they try to offload things, have you run into that where they offload something and you don’t want to deal with it, you don’t like dealing with it? How do you deal with that?

Brock Mogensen: It’s a good question. I would say, in the beginning, that was probably something that happened, where there might have been some tasks… But again, I was kind of coming in, showing myself, saying I’m going to do all these tasks, and do everything. I think in the beginning, there were definitely some things where it’s like, “I don’t really want to do this”, but I know I have to do it, to prove my value. Now that we’ve done more and more deals together, it’s all even. We all put the same amount of work, and have been able to hire some virtual assistants now, so we’re able to delegate some of those tasks. As you’re growing, there’s still going to be stuff you don’t want to do. You can’t outsource everything. So there are those days where it’s like “I don’t really want to do this, but I know I have to do it.”

Ash Patel: So it’s not “Hey, Brock will do it.” That doesn’t linger from the early days. “I’ll just give it to Brock. Brock will handle it.”

Brock Mogensen: No. I would say it’s pretty even now. Obviously, there are certain tasks where it makes sense. Like the reporting stuff and some of the admin stuff where I’m the one that’s kind of manning that stuff. It just naturally makes sense for me to do it, even though it might be more of a mundane task. That’s my role and that’s what I’m doing. They’re bringing in more of the capital, so that’s obviously a huge value-add on that side.

Ash Patel: Brock, what’s the hardest lesson you’ve learned in real estate in general? I’m talking about a tough lesson, a hard lesson, one that beat you down.

Brock Mogensen: I would say, really going back to that first deal we did. We had a few learning lessons there. I think it really changed our business plan of wanting to not necessarily target any C-class properties anymore. We’ve had quite a bit of struggles there, where we didn’t budget correctly on the front end, ended up having to evict much more tenants than we thought, which led to more unit turn costs… Then once we get all that figured out, we’re finally in a good place and hitting our proforma, COVID decides to hit. We have 10 tenants walk in and say they’re not going to pay rent, we can’t do anything about it.

Then we had to kind of go back to the drawing board on that and figure out a way to get out of that. We had to work with some local community programs to get funding to cover some of that. So there was definitely a ton of learning lessons on that first deal. I think it’s just a matter of… There’s always going to be learning lessons on every deal, and just taking that, and making sure you don’t make the same mistake again.

Ash Patel: Yeah, that’s a tough position to be in. It feels like the walls are caving in on you.

Break: [00:16:27][00:19:20]

Ash Patel: What were some of the issues with, you said class C properties? Was it the tenants or was it the renovations?

Brock Mogensen: The tenants, I would say. Really, I think it’s just… There”s good deals, I think right now especially, even the C-class deals. The cap rate difference between a C deal and a B deal – really not that much different nowadays. I think, personally, I’d rather pay a little bit more, have a little bit less of a return on a B class deal on the front end, and cash flow, to know it’s just going to be smoother on the management side. Generally, the B class, it’s going to be easier to exit those sorts of properties.

Ash Patel: The $3.5 million property – is that close proximity to where you guys are?

Brock Mogensen: Deal size we’re looking at now…

Ash Patel: No. Location-wise. Sorry.

Brock Mogensen: We’re in the Greater Milwaukee area. My partner’s management company is right outside Milwaukee; an hour radius of Milwaukee is kind of our target zone.

Ash Patel: Got it. What advice do you have now in managing C-class tenants?

Brock Mogensen: Really keeping a pulse on everything in the property, looking at the numbers daily, and having some sort of KPI reports. We learned to really track collections, see and stay in touch with the on-site manager there to understand… We have a call with them each week to understand where are we at, “We’re only at 80% collected, and it’s the 15th of the month. Give us a list of those 10 tenants that haven’t paid yet. What’s the status? ” You really have to keep a pulse, especially in that space where they might not care as much about their credit, so if they don’t pay for a few months, they’re not too worried about it, as long as they get away with it. I think really, the collection is a big part of that, and managing expenses as well. Tracking KPIs every day on a weekly basis, at least, looking at the numbers, and talking to your property management company to make sure we’re doing everything we can to hit proforma – that’s the key, I think.

Ash Patel: Do you remember what the total renovation cost was on that property?

Brock Mogensen: We’ve put at least 200 grand into renovations. In the beginning, we were flipping units and kind of putting in the LVP flooring and everything. Now that we’ve realized there’s not as much of a rent bump there that’s worth it for those costs, we’ve kind of trimmed down some of those unit flip costs, which has helped. But yeah, there were a few other items. We’ve put in new lighting, we updated the camera systems, stuff like that, that we did budget for on the front end. But the unit turn costs are really something that usually are going to be more expensive. It’s going to be, especially now, with supply costs going up, labor costs going up, 5% or 6% a year. You have to account for that and assume it’s getting more expensive than you think.

Ash Patel: I’m glad to hear that you guys pivoted and changed how you renovate the units. If you’re not getting the returns that you anticipated, why continue super-improving properties?

Brock Mogensen: Exactly.

Ash Patel: Yeah, that’s a great lesson. How long is the hold on this property?

Brock Mogensen: We were targeting a seven-year hold on that property. We’re about two and a half years in, so we’ll get a few more years before we start looking at an exit.

Ash Patel: Why seven, versus five or less?

Brock Mogensen: A lot of it has to do with the loan structure. We use agency debt on that. There is a prepayment penalty all the way up until year seven. So even if someone were to come in today and say, “Hey, we will pay you a million dollars more than you bought it for.” If you look at their prepayment penalty, it’s really not going to make sense. That’s I think one of the downsides to working with agency debt, they almost always are going to have a higher prepayment penalty, unless you structure it a different way. But that’s where it really doesn’t make sense. Maybe when we get year five or year six, it might make a little bit more sense if you look at the prepayment penalty. But the 10-year note, at year seven, that prepayment goes away, so we do have a nice three-year window there to sell. But that’s the main thing, is looking at that and deciding when it makes sense. One of the benefits of working with local banks is, a lot of times there’s no prepayment penalty.

Ash Patel: Is that prepayment penalty staired, where it gets reduced each year?

Brock Mogensen: Not in our structure, no. It’s all just based on what’s owed.

Ash Patel: What’s the penalty?

Brock Mogensen: We have to pay out all the interest owed until ,up until year seven. If you look at the numbers and we’re in year three, four years of interest is a lot of money.

Ash Patel: Is that loan assumable?

Brock Mogensen: That is a good route and a good question. Yes, we do have the option to assume it. And we’ve kind of looked at exploring it for some people that have looked at it and made us some soft offers; we’ve kind of tossed that out there. I think most investors don’t like to assume a loan, especially with interest rates having gone down probably 100 basis points. We’re at like four and a quarter, I think, on that deal, right now… They need to get money in the 2% range now, so it’s a pretty big jump down there where a lot of investors are like “No, I want to get my own loans. I know I can get much better terms.” I think that just adds a little bit more hair on trying to sell someone a deal early.

Ash Patel: How much did you have to put down?

Brock Mogensen: That deal, I think our total capital raise was 830k. We did 80% LTV on that deal.

Ash Patel: Awesome. Brock, what is your best real estate investing advice ever?

Brock Mogensen: I think thinking big. A lot of who people get into real estate and just assume the only way to get deals done is to save money and buy a deal. But just think big and think creatively. There are a million different ways in real estate to structure a deal. You can get creative on a lot of these deals, and then get into some larger deals with less money out of pocket than you might think.

Ash Patel: Great advice. Brock, are you ready for the Best Ever lightning round?

Brock Mogensen: Let’s do it.

Ash Patel: Let’s do it. Brock, what’s the Best Ever book you’ve recently read?

Brock Mogensen:  Somewhat recently — I like some of the mindset books. I read 10X Rule. I got it here in my background, actually. I like that book for mindset and kind of thinking big.

Ash Patel: What was your big takeaway from that?

Brock Mogensen: Just that whatever your mindset is right now and whatever your goals are set at, you can think much larger, and just grow how you’re thinking. That really was a huge pivot point for me. Looking back at some of the goals I had three years ago when I was first starting, compared to the goals I’ve set now – they are just so much larger.

Ash Patel: Brock, what’s the Best Ever way you like to give back?

Brock Mogensen: I would say providing people with the education of learning real estate. I get a ton of calls a lot of times from people and I just explain how real estate works. I talk to my friends about it, show them the basics, [unintelligible [00:24:54].23] and invest in real estate. That’s, I’d say, at this point the way I’m giving back most, is through education. I have some bigger goals down the road, but that’s where I’m at right now.

Ash Patel: Brock happened the Best Ever listeners reach out to you?

Brock Mogensen: Yes. I’ve tried to post quite a bit on Instagram, real estate stuff. That’s just @brockmogensen. My email is brock [at] Our website is, we have some free downloadable templates there, and some different eBooks.

Ash Patel: Brock, I got to thank you again for your time today. It’s hard to believe that it was only three years ago that you started a house-hack, and now you’re doing syndications. But you worked your way into this partnership, you hustled, you put the grind in. I love your story. Thank you for joining us today.

Brock Mogensen: Thanks for having me on, Ash.

Ash Patel: Awesome. Best Ever listeners, thank you for joining us and have a Best Ever day.

Website disclaimer

This website, including the podcasts and other content herein, are made available by Joesta PF LLC solely for informational purposes. The information, statements, comments, views and opinions expressed in this website do not constitute and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action. Neither Joe Fairless nor Joesta PF LLC are providing or undertaking to provide any financial, economic, legal, accounting, tax or other advice in or by virtue of this website. The information, statements, comments, views and opinions provided in this website are general in nature, and such information, statements, comments, views and opinions are not intended to be and should not be construed as the provision of investment advice by Joe Fairless or Joesta PF LLC to that listener or generally, and do not result in any listener being considered a client or customer of Joe Fairless or Joesta PF LLC.

The information, statements, comments, views, and opinions expressed or provided in this website (including by speakers who are not officers, employees, or agents of Joe Fairless or Joesta PF LLC) are not necessarily those of Joe Fairless or Joesta PF LLC, and may not be current. Neither Joe Fairless nor Joesta PF LLC make any representation or warranty as to the accuracy or completeness of any of the information, statements, comments, views or opinions contained in this website, and any liability therefor (including in respect of direct, indirect or consequential loss or damage of any kind whatsoever) is expressly disclaimed. Neither Joe Fairless nor Joesta PF LLC undertake any obligation whatsoever to provide any form of update, amendment, change or correction to any of the information, statements, comments, views or opinions set forth in this podcast.

No part of this podcast may, without Joesta PF LLC’s prior written consent, be reproduced, redistributed, published, copied or duplicated in any form, by any means.

Joe Fairless serves as director of investor relations with Ashcroft Capital, a real estate investment firm. Ashcroft Capital is not affiliated with Joesta PF LLC or this website, and is not responsible for any of the content herein.

Oral Disclaimer

The views and opinions expressed in this podcast are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action. For more information, go to

    Get More CRE Investing Tips Right to Your Inbox

    Get exclusive commercial real estate investing tips from industry experts, tailored for you CRE news, the latest videos, and more - right to your inbox weekly.