Iven Vian, the Apartment Ninja Warrior with an 800+ unit portfolio, shares his wisdom about the importance of proactive asset management, being in alignment with your property management company, and facing the realities of real estate investment.
Key Takeaways:
- Shift from Reactive to Proactive Management: Ivan highlights the critical importance of understanding how today's decisions impact the property's future, focusing on mitigating risks, and maximizing long-term profitability.
- The Business Mindset in Real Estate: Iven stresses that owning commercial real estate is not just about property ownership; it's about running a business. He dispels the myth that investing in real estate is a passive endeavor, highlighting the necessity of aligning ownership goals and involving property management companies as integral parts of the business strategy.
- Closing the Gap Between Expectations and Reality: Iven calls for transparency and realism in the industry, advocating for a more seamless transition from underwriting to property management. He believes in addressing misalignment in ownership teams, setting clear priorities, and ensuring all stakeholders have a deep understanding of the operational aspects of a property investment.
Iven Vian | Real Estate Background
- Owner of Apartment Ninja Warriors
- Portfolio:
- 880 doors
- Based in: Oklahoma City, OK
- Say hi to him at:
- Best Ever Book: Think and Grow Rich by Napoleon Hill
- Greatest Lesson: If you're doing this as a GP or operator, you have to approach real estate as a business and treat it like one.
Check out Iven’s previous episode: 2702 - 4 Ways to Balance a Full-Time Job with Multifamily Investing
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Transcript
Ash Patel (00:01.418)
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, Iven Vian. Iven is joining us from Oklahoma city, Oklahoma. He is a returning guest on the best ever show. If you Google Joe Fairless and Iven Vian, his episodes will pop up. Iven is the owner of the Apartment Ninja Warrior Academy, a community of asset managers who learn to optimize their properties so that they can raise more capital and build their apartment portfolio. Iven's portfolio consists of 880 doors. Iven, my friend, how are you, man?
Iven Vian (00:40.438)
Doing outstanding, great to see you again, Ash. Very excited to be here.
Ash Patel (00:43.858)
Yeah, brother. A great to have you on. If you would give the best ever listeners a little bit more about your background and what you're focused on now.
Iven Vian (00:52.55)
Yeah, absolutely. My background is I'm a full-time apartment investor owner operator. Previously that, I spent 20 years in the Air Force, flying jets all over the world. And during that time, I learned a lot about the importance of working with the right people and having the right processes in place in order to have a successful operation. And a lot of what I do today, working with apartment owners and operators and helping them optimize their properties through proper asset management, tips, tools, and tactics. A lot of what I do today is a result of my military career and transferring that over to the apartment world today, let alone just my own experience. Now I've been in this business for almost 10 years.
Ash Patel (01:35.122)
I haven't, you probably know this, but I tell a lot of people that our original interview together was one of the best ones I've ever done. The reason for that is you are this big stoic B1 bomber pilot, man. You are clean cut, jacked, dressed perfectly. And on that episode, you shared a lot of mistakes and failures that you had and lessons that you've learned from it. Um, so that was just you being real.
And I think that's what really connected with the audience. So brother, I'm looking forward to doing another great interview with you. Let's start, uh, let's take the elephant in the room, man. Multifamily is a lot different today than when you and I did that interview a couple of years ago. What are your thoughts on the current state of the economy? Sorry. Current state of the economy as it applies to multifamily.
Iven Vian (02:25.606)
The current state of the economy applies to multifamily. I mean, to be honest, we're going through a very challenging time. It's been spoken about time and time again that all of those that got into this business in the 2020, 2021 timeframe with floating rate debt, rate caps are going through very challenging times. And to couple that challenge on top of that, what do we have, what do we experience today? Actually, year over year decline in rent growth overall, and some of the major markets that we're all investing in. We have increasing taxes, increasing insurance. And a lot of things that people don't talk about is, not only are owners and operators going through similar challenges, but property management companies are also experiencing their own set of challenges.
When COVID hit, remember we kind of shut down, and a lot of the seasons operators of property management company managers quit the business. And so that corporate knowledge left the room and we were left with a less experienced crowd still good, but less experience. But then what happened is we had a very high demand for talent to and it's harder and harder to find managers harder and harder to find maintenance people to work at properties.
And those property management companies that did not invest in a strong HR department, a strong training department, but more, uh, above that is to build out a culture, to cause people to want to stay with these companies and operate at these properties that have their own unique set of challenges. Those that didn't build out a culture of falling apart today. And so a lot of what I talk about is understanding this because really, the key to this business, unless you're vertically integrated holding company that has your own vertically integrated property management company, the key to this business is really about you finding the right property management company that aligns with you and that also aligns with the property that actually knows what they're doing and has spent time building out HR department, training department, and that culture that we need to give the managers a reason to stay at the property above and beyond just transactional environment.
Something that they feel that is important beyond just creating a profit. Something that is above and beyond themselves. That's where this culture piece comes into play. That's so important.
Ash Patel (05:03.026)
Iven, what do you do to develop that culture amongst your team and your partners in this business?
Iven Vian (05:09.99)
What do I do to develop that culture? I mean, everything in this business is a relationship at the end of the day. And when you take time to generally show that the people you're working with, in this case, the property management company, that you want to understand them, that you know them. When you take the time to get to know them, then they will wanna take the time to get to know you. There's a saying that says, understand to be understood. So what do I do?
I spent time with my property managers and I spent a whole day with them. And I understand that the day in life of being a property manager, day in life of being a maintenance person, the day in life of being a regional manager, I sit in on their meetings, sit in on their corporate training meetings, sit in on a lot of the meetings and develop that relationship. It's so vital and so key. And then what you do is once you understand the company, you understand what their DNA is, what their fabric is about, then you actually become part of that team. It's not an us versus them mentality. It's us with them mentality. You're working together. So the team is not just a property management company you separate, it is all of you. And so I look at everything as one big unit. And once you develop that cohesIven Vianess, then there analyze opportunity for you to provide influence.
And I have the saying that you have to think like a property manager, but act like an asset leader. How can you think like a property manager if you don't truly know what it is to be one? Once you understand what it is to be one, then you have to be able to influence through leadership. And a lot of this business is about influence through your own leadership abilities. And when you're able to do that in a very healthy way, because you have taken time to develop your own leadership characteristics, then you'll see that take effect at the property level and your KPI will start to grow, your property will start to improve, the demographic will start to change and bit by bit, little by little, you'll see actually your business plan happening like you originally thought it was supposed to.
Ash Patel (07:29.61)
Iven, I want to clarify when you do the day in the life of, and you shadow these people, these are not your employees. They are your property managers, third party companies. Is that right?
Iven Vian (07:41.094)
That is 100% correct. No, they are not my employees, but I see them as my partners. They're a third party property management company, but you form a partnership beyond just a contract or agreement. You've got to create this partnership through a strong working relationship. And let me tell you, here's the thing. A lot of owners are not fun to work with. A lot of owners are very demanding with a lack of understanding and appreciation.
I go on to these Facebook groups and I watch these managers talk to each other and vent about owners. Go in there and see what they say just to get insight and understanding what it is to be a manager. And if you could be the owner, go ahead.
Ash Patel (08:24.782)
I think, yeah. No, I think that's an incredible approach and I'm trying to take it a step further. All these brokers that we call wanting deals, hey, what do you got that hasn't hit the market yet? Imagine if you took your approach, hey, mister or Mrs. Broker, do you mind if I shadow you for a day, man? I've got a lot of respect for you and I wanna see what a normal day is, what the struggles are, what the fun parts are.
Man, if you do that for one day, they will never forget you because everyone else has a transactional relationship with these brokers. And here you are taking a genuine interest in what they do. I can't imagine the returns that would give you and the mutual respect that you would end up with at the end of those one day. So dude, I admire the hell out of you doing that. That's brilliant.
Iven Vian (09:15.054)
Yep. Mutual respect. You hit it on the dot right there.
Ash Patel (09:20.454)
Yeah, I love that. Hey, so it wasn't, um, that long ago. I saw a crazy post. You are dressed in probably a $2,000 suit. You've got a pair of nunchucks in your hands and you took on this persona of the American Ninja Warrior Academy, sorry, Apartment Ninja Warrior. Explain to me the evolution of that, please.
Iven Vian (09:47.214)
Absolutely, man. Well, I think we all kind of have an understanding of what a ninja is. Right. And, and I believe that mindset of what a ninja is so important to today's apartment world. So what is a ninja? One, they're lethal. When they throw that star, they don't miss. Two, they're very strategic, very well thought out. Three, they can go in, get a job done and get out. Unscathed, untouched.
And think about you as an asset manager, you show up to a property, you get in, get a job done and you get out. You have to be able to hit your marks. You have to be able to hit your KPIs or exceed your KPIs. And you have to have a wealth on out strategy. But beyond that, they have a high morality, high, strong character, high discipline, they're focused, they have strong work ethic, work ethic. They're willing to stay at something until they get it done.
So all these care risks embody what I believe is necessary to be a very good asset leader in today's environment.
Ash Patel (10:52.894)
Explain to me the difference between an asset manager and a property manager.
Iven Vian (10:58.658)
Yeah, a property manager is someone who actually works, physically works at the property every single day, that is working directly with the tenants that come in. Signing leases, showing units, making collections, the person that's making sure all the work orders are getting completed when a tenant calls in and saying there's a leak on their sink, that property manager then makes sure the maintenance person goes and fix that leak with the property.
So that's the property manager. They oversee the day to day operation. The asset manager is the person that oversees the property manager. The asset manager has a fiduciary responsibility to meet or exceed a return for his or her investors. And so the asset manager is a person that makes sure that the business itself is going to produce a profit. And so really what you're doing your job is to maximize profit while minimizing downside risk as an asset manager. But I'm not the one who's reviewing leases, signing leases. I'm not the one that makes sure physically money is showing up inside the bank account. I'm the one that makes sure all those things are actually getting done through the property manager.
Ash Patel (12:17.402)
And you have a mastermind program where you train others on what?
Iven Vian (12:23.29)
Absolutely. I have a Mastermind program that trains other people on the specifics on how to maximize your return on investment while minimizing your downside risk as an asset manager. So I give them all the tools, tips and tactics in order to be able to do that. But taking a step back, at the end of the day, you're going into a deal that has to produce a certain return. And the key is how are you going to hit that return? And so we then put in the systems in place in order to be able to do that. And there's two sides again. You have people and then you have processes. And we focus on hiring the right people, which is a property manager company. And then also the processes, the process that we all should be following to make sure that we can meet or exceed that return at the end of the day.
Ash Patel (13:12.55)
Iven, I'm going to play devil's advocate. How hard is it to manage a property manager?
Iven Vian (13:18.618)
How hard is it to manage a property manager? It is as hard as if you don't hire the right property management company. Problem is a lot of people don't take the time to identify what makes a property management company a good property management company. And therein lies a lot of the issues that we are dealing with today. And I told you earlier on this podcast that property management companies are going through their own evolution of growth that they need to go through to be able to operate in today's environment. And how they were operating things previous in the previous cycle is not how we should be operating things today. And so we have this. We have this.
Basically, we have this period right now where they're going through this evolution, the problem, the owners are going through this evolution and we're trying to figure out how to actually operate with efficiency in today's market. But beyond that, the thing is, in the previous cycle, the tide was up. The tide was up and you didn't have to actually have to perform that well. Many, I mean, as well as you do today, many, many people bought deals and they simply just went up in value due to cap rate compression.
So therein lies the opportunity. Now we're being challenged. Your true skills are being put to test. And today's environment, every single person that buys a deal right now, you have to hit with precision and accuracy. You have to be hidden in the bullseye and every single KPI has to be hidden in the bullseye for these deals to work. Very, very little room for error, especially because the cap rates are not compressing currently.
And so you have to be very, very smart about the deals you're buying. But then you have to have your plan in place before you even buy the deal. You have to have to know exactly what you're going to do before you buy the deal and what that plan involves people and involves processes. And a lot of people I talk to and they say, Oh, I'll find the construction company after I buy the deal or I'll put in the true game plan after I buy the deal. And it's like, dude, soon as you buy that deal, the clock starts ticking.
Iven Vian (15:39.97)
And if you're not producing cash flow, your what your IRR is going to continue to go down, down and down the last cash flow you produce in a timely manner. And it baffles me that people don't understand this. And so again, back in the Academy, we prepare people before they hop into a deal. To teach them how to operate that deal before they hop into it. What is on the other side of that coin?
We teach them that so that they're prepared to be able to operate that deal so they don't have to figure it out. So they actually have the true playbook and game plan in their hands before they buy that deal. Right? To answer your question, it's challenging. It's challenging. I don't want to sugarcoat this thing, but it could be even more challenging if you don't know what the heck you're doing. We don't want, and we know what happens when people don't know what they're doing, right? They lose their deal, unfortunately.
Ash Patel (16:18.322)
I've been, yep.
Ash Patel (16:34.154)
Yeah, I haven't with your key performance indicators. Are they tracking effort or results? Meaning, you know, are they tracking vacancy or occupancy versus the effort it takes to get there?
Iven Vian (16:47.686)
Are they tracking effort versus results?
Ash Patel (16:50.526)
Yeah, what I mean by that is, you know, is one of your KPIs reducing vacancies, or is it spending time on these tasks that reduce vacancies?
Iven Vian (17:05.954)
Mm hmm. So it, at the end of the day, it's, it's tracking results. Okay. Now, when you talk about the effort to create efficiencies on the other side, I don't necessarily track that it is up to property management company to create those efficiencies. But if you create your own thresholds and markers for them to be able to hit, it forces them to then organize themselves in a way such that they're become more efficient.
Right? And that therein lies the, for example, putting in a budget and we have a process to be able to understand how to build a budget. And if they don't hit those budgeted numbers that we've already agreed to and agreed upon as the playbook, we're going to follow. Then you then go and understand and unpack why that is.
And I have this process called root cause analysis and root cause analysis is first you identify what is the desired focus point that you want to focus on, then you determine all the contributing factors, why that particular KPI has an unfavorable variance. Once you identify all the contributing factors, then you identify the root cause. Once you have that root cause, then you can put in a fix. And that fix, that root cause may be due to inefficiencies. A couple of examples though, yes. Now that I think about it, for example, how long did it take to do a work order repair? How long did it take? The longer it takes, the less likely you're going to have your tenant renew their lease. So that is one.
Two, how long did it take for someone to answer the phone? Or how long did it take for someone to actually return a phone call or a message or text, so on and so forth? So there is some of that goes on as well. But one thing I want to point out, the numbers are just numbers. It's really about understanding the story that the numbers are telling you and learning to read between the lines. And one thing that people I think are are doing is that when they look at the numbers, it's about something that happened in the past. Okay, you have these lead and lag indicators. And what you're looking at numbers is something decisions that happened in the past. But the key is to be able to look at the numbers and understand what's going to happen in the future. Being proactive versus reactive.
So when we're putting together all the numbers, it's really about understanding this term called exposure. And anything I do today will impact future exposure future exposures in an event that will cause an economic loss. If I am too aggressive on my renewals and I send them out today, you think a lot of people are going to renew? Say you went up 200, 300 bucks in the winter months and a very, I'm over exaggerating here on my example. A lot of people may say, no, I'm not going to renew. That's ridiculous. I can go down the street and only have to pay $100 more. It's worth me moving in the dead of the winter not to have to pay $300 more a month.
Well, that's going to create a lot of vacancy loss because they're not going to renew. Now you're exposed. And if people don't have the forethought to think ahead, what that's going to cause in your exposure. So a lot of what we focus on is understanding what the KPIs are telling us from an exposure standpoint, and then determine our rent rates today to minimize that future loss in the future.
Ash Patel (20:24.662)
Got it. You mentioned the need to be way more efficient today because the markets are not as rewarding or as lenient as they once were. What are some examples of innovative approaches that you've taken to become more efficient?
Iven Vian (20:40.738)
Absolutely. So the value add model is you, you rehab a unit, raise the rent, 250, 300 bucks and get at least up. But, but people didn't, don't quite understand it is how long it takes to rehab a unit. And is it worth exposing that unit to vacancy loss to rehab it? And a lot of times it is not, especially in today's environment, when year over year rent growth is decreasing.
Those $300 rent bump days are not there. And our occupancies are starting to decrease because there's a lot of delinquency in the market. So our occupancies are decreasing, concessions are increasing, our rent growth is decreasing. What we need to focus on is retention and building up communities for people to wanna stay out of property and retaining the tenant. Because as soon as the tenant leaves and you think you can go ahead and rehab that unit to get a $200 rent bump, what additional value actually gaining because how much does it cost to rehab these units these days or rehab costs have doubled or tripled in some cases what used to cost five thousand bucks not cost 10 what cost 10 now cost 20 so say it's a fifteen thousand dollar rent uh um fifteen thousand dollar cost to improve that unit fifteen thousand dollars you have to spend to get say a two hundred dollar rent.
The $200 rent bump over 12 months is $2,400. But you just spent $15,000 to get a $2,400 extra profit. Now, let alone the time it takes to get the tenant out, rehab it, and to get it released. Say you budget. If you're really good, you can get it all within a month. But say it's two months. Now that tenant is not living there for two months while you rehab the unit.
So you lost probably $1,200 a month, which is right around $2,400. So you spent $15,000 to lose $2,400 in rent, as well as you have to pay, lose $2,400 in rent in order for you just to gain $2,400 more profit. So you actually, you get nowhere in that whole process. And here's what happens in reality. And then the fricking tenant comes in and they trash the unit.
Iven Vian (23:03.346)
And you evict them in nine months. So you just spent 15K and you evicted that tenant, you did not even realize your rent bump. You just spent 15K, you didn't have to. And now you extrapolate that over say 50 units that you do within a year. I don't think people understand, you're wasting money. You're wasting money. As you play this, retain, retain. Do quick.
Ash Patel (23:25.61)
What's the solution to that? What's the solution?
Iven Vian (23:31.522)
Lease trade-outs, dustings, maybe some flooring carpet paint, simple rehabs and retain and create community, create culture, be less transactional, be more relational in these environments so that people wanna stay, so that people then want to feel like they can justify paying extra costs. Now, here's the thing, you gotta rehab the outside. You gotta do, you have to improve the property, okay?
You got to show that there's improvements. You got to add in the money to here. You got to still compete with the marketplace. But this whole model of taking a tenant out, taking the time to rehab it, just experience vacancy loss, extrapolate that over 10 units, you actually don't move the needle.
Ash Patel (24:16.994)
How do you build a culture amongst your tenants?
Iven Vian (24:21.462)
Sure. I have a public management company in Salt Lake City. They have their own sister organization, non-prof organization, that organization's sole job is to come in and do community service events. I was just there actually yesterday at the time of this recording here. I was there yesterday and I was there and the gentleman's there with a big bunch of cookies and they're gonna do some kind of Christmas event and they're doing a clothing drive there.
One thing that I did, one thing that I do is have my own nonprofit where I am, you know, it's all about making impact, impact at the property. But I have the question, how can I have my property make an impact in the surrounding community as well? Think about it. You have all these people that interface with the city. Okay, so say 150 unit property, there's at least 200 people in that building that go out to the city on a daily basis.
How can you use your building to make an impact on the surrounding city? So what I've done is identify star tenants who are already volunteering at nonprofits outside the building, outside the apartment. And then I make a donation to that nonprofit that they're volunteering at and recognize them on their behalf. And the whole idea is that if we contribute to the surrounding area, then the surrounding area that contribute back to our property. So I had a tenant who was a chef and he liked to help homeless people learn how to procure food and help them survive on the streets.
At the Utah Food Bank, we made a donation to Utah Food Bank on this tenant's behalf and recognize them, gave a large donation. The Utah Food Bank then gave a bunch of turkeys back to our property, and then our property had a huge Thanksgiving feast. Isn't that cool? This likes you.
Ash Patel (26:11.294)
I love that. Yeah, you're cultivating an ecosystem of giving. Yeah. Iven, when did you start the academy?
Iven Vian (26:21.886)
I started the Academy earlier in 2020, what year is this? 2023, so Q2 of 23.
Ash Patel (26:30.158)
And the ninja came about the same time.
Iven Vian (26:34.33)
Just before that, I literally just woke up one morning and said, I'm the apartment ninja warrior, baby. Let's go.
Ash Patel (26:41.33)
What's the feedback you've gotten from that character?
Iven Vian (26:44.974)
Everyone loves it, man. Everyone loves it, right? And it's so yeah, it's the saber I got is from my Academy days. It was sitting on my wall. I was like, I can go buy a ninja sword and just pull the thing off the wall. So that's what I use. And the nunchucks, my military days, they called me odd job. Okay. Odd job is a character from a James Bond movie. Everyone gets a call sign. Yes, my call sign was Odd Job. Look him up. He's the guy that threw the hat and anyhow, there's just this little joke - why not give odd job some nunchucks? So my buddy made me some nunchucks and I've had them on the shelf for a number of years. I was like, well throw them in with the character.
Ash Patel (27:35.306)
I just looked this up. California and Massachusetts are the only States that still ban nunchucks. So just be cautious in California, Massachusetts. I love it. You know, we're God, we're in such, um, a non dynamic industry, right? Real estate. I mean, look at the realtor commission model. God, it's been years and ages since it's needed to be overhauled. And just now it's getting some movement.
Iven Vian (27:42.818)
Ah, be careful.
Ash Patel (28:05.742)
Um, we're just in an industry that doesn't innovate a whole lot. So I admire you for taking on that persona and just doing something different, man. Good job. I got to ask you though, um, post COVID a lot of deals are going South and a lot of people have, uh, turned from, you know, being successful syndicators to getting into coaching because the income is no longer there.
Is that what's driving you? Is it a need for income? What makes you do this?
Iven Vian (28:38.958)
Man, quite honestly, dude, I, my eyes naturally light up when I'm, when I'm coaching, when I'm mentoring, it just, it's feels like it's the natural evolution of where I've been, you know, I've done a lot of deals. I've been through a lot. I've seen a lot and I see the need for something like this in the marketplace and I see the gap that took place of how everyone got into this business to a lot of these other mentorship programs. I didn't talk about operations, and the tide was continuing to rise.
So there wasn't a need or it wasn't enough pain out there, blood in the water, to have a desire for something like this. And for me, like, you know, all the way from my military days to now, I've always been an instructor at heart. Like, you know, I've taught guys how to fly airplanes and take off and land in every field and drop bombs and all those things. It's just naturally kind of who I am. So it's a natural fit kind of evolve into this person today in the apartment.
Ash Patel (29:35.294)
And you're not teaching people how to become multimillionaires. You're teaching them very specifically on how to manage this asset.
Iven Vian (29:43.546)
100%. We have people that come in, that they come in as a profession to learn asset management, who then get later drafted into say, another ownership group. And then
Ash Patel (29:57.854)
Yeah. So that differentiates you because, you know, a lot of these other programs are, I'll show you how you can quit your W-2. You'll become a millionaire in three years, but you are, you are like a college course, you know, a master's degree, so to speak, in property management.
Iven Vian (30:20.534)
Asset management. Yeah.
Ash Patel (30:21.81)
As a, sorry, asset management. Um, okay, good. So I get it. Um, you're not taking somebody off the streets and teaching them multifamily and asset management. And raising capital and dispositions and all of that.
Iven Vian (30:34.886)
Well, listen, no, I'm making that I'm making the argument that let's say you want to go buy a multi million dollar Learjet to fly your friends and family to their favorite island destination. Well, before you go buy that very expensive piece of equipment that airplane, don't you think you're gonna have to learn how to fly the thing? Or else you're or okay, fine, they may make our fine, I'll hire a co pilot to help fly it with me.
Okay, fine. But do you trust that pilot? And do your investors trust that pilot? No, your investors trust you. And who are they going to look to if that frickin plane crash and burns or doesn't hit the runway like it's laying on the runway like it's supposed to? They're gonna be looking to you. So don't you think you should understand what it takes to operate an apartment before you get into one? So yeah, we do have people coming in, but we're showing them from an operational standpoint, what the reality is.
And we underwrite deals from an operational standpoint, from a property management standpoint, not from a financial standpoint, which is a totally different approach to this business, which is reality. Okay, so yes, we do also focus on acquisitions, but from an operational standpoint. However, the main core is asset management.
Ash Patel (31:56.786)
Understood and you this is a side hustle. This is not your bread and butter. You're still on the streets You're still a real estate guy
Iven Vian (32:05.038)
Yeah, you got to be in the trenches, right? To be able to have the street kid to be able to educate and mentor. So yeah, we're still out there, pound on the payment, underwriting deals, looking at deals. And...
Ash Patel (32:16.246)
What are you doing to find deals today?
Iven Vian (32:18.886)
What do I do to find deals today? It's the same methods that have been there since day one. You can get them off market and get them on market. You gotta build out your channels, but it's relationships at the end of the day. It could be a relationship you have with an insurance broker that you've developed over the years who knows this one guy has a deal that's going through some troubles, doesn't wanna take it to market, wants to do it, acquire clothes, and you go and get access to that deal that way, for example.
Ash Patel (32:46.59)
And Iven, how's the pipeline right now?
Iven Vian (32:51.091)
It's still interesting. It's still huge gap, quite honestly, between expert seller, expectation and by expectation. Um, it's starting to pick up and the blood is starting to enter the water though. Um, especially on the, on the coaching mentoring side, you're seeing exactly what's going on with these properties in reality as you're helping, trying to help people to overcome a lot of these challenges, uh, and negative cashflow, um, tight situations.
But at some point that's gonna come to a head and it's starting to come to a head now.
Ash Patel (33:21.57)
What is the lowest hanging fruit when it comes to improving your asset management? What do most people do wrong?
Iven Vian (33:30.414)
Yeah, well, most people do wrong again. They are reactive versus proactive. They're not looking into the future and determine what their decisions are going to do today, how it's going to impact the property tomorrow. And so you have to understand the exposure you're going to create by your decisions you make today. For example, if you're going to go aggressive on your renewals and you're going to create a lot of exposure, but then you don't have a rehab plan in place to be able to take care of all the make-readies or new rehabs in place. If you can't predict that and plan for that, now you have a bottleneck there because you're not producing enough units. Now you have a lot of units that are not ready sitting on the market, not collecting rent. So again, being proactive versus reactive.
Ash Patel (34:16.09)
Iven, somebody comes to you and they're underwater on their deal. They had to pause distributions. Lenders are knocking on their door. What's your advice to them?
Iven Vian (34:30.678)
Yeah, you know, we got to understand the situation first, we got to stop the bleeding, man, you got to stop the bleeding, right? And every situation is unique. And it's interesting how now digging into these situations, I'm mentoring people in these situations and how that's preventable. Why one thing, for example, too many, too many chefs in the kitchen, too many GPS trying to control the deal. One person has to be in charge.
One voice, one decision maker with supporting cast members. You don't have alignment even at the ownership level. Or you have misprioritization of priorities. Meaning you have a deal going underwater, but then you have one of the owners still looking for deals, trying to go out and make the next dollar. This deal over here is not working. So the focus is not there. I'm like, dude.
This is a simple fix. We have to have a come into it. Jesus talk here, man, and get real with one another. Everyone has to get in a room, and we have to create alignment in ownership side. Once you create alignment ownership side, then you have to create alignment with the property management side, with the main person on the property management side. Then you have to get the property management team beneath the property management side, all in agreement and alignment. There's so much misalignment going on that's creating a lot of churn, lot of inefficiencies, people quitting people leaving or people getting upset or, or pointing the finger now or that's not my job. That's not my job. You have this culture environment. That's not productive. If we all can just swallow our pride a little bit, admit to our own mistakes, take ownership of these, this, these situations we're in, you actually will see a tremendous impact in the right direction at your properties.
A lot of what I do is coaching that, not just not the mechanics, but the relational side of things. Or I have people that they, um, are not an integrator at heart, yet they want to self manage their properties, um, and which are losing money every single day. I'm like, listen, man, you're good at leading people. You're good at casting vision. You have to give this to a property management company.
Why are you doing this right now? Why are you taking yourself out? So that you are freed up to look at the bigger picture. And that's one example of what's going on today in this environment. So, yeah.
Ash Patel (37:10.87)
Man, I love what you said. Um, and you know, what you said would be what a CEO would do if their business was failing, they wouldn't abandon ship and go look for the next business to buy. They would do everything that you just said, get the team together, align your focus, you know, assign responsibility, one leader. Um, and you know, I think we've been spoiled in commercial real estate because it's a non-contact sport.
We've got commercial, it's great that real estate people all help each other. We have this podcast to help everybody. Right. You, I know have mentored tons of people, help tons of people. That's not the real world, brother. If you are a business owner, you have competitors every day gunning for you. We don't have that in real estate. It's a non contact friendly sport. Right. We're not playing in the real world where it comes to businesses that their success depends on others failures, right? Your competition is eating your lunch every day. With real estate, there's plenty to go around. So we've been very spoiled. And again, what you said is the advice that you would give a business owner. Unfortunately, in commercial real estate, man, we haven't gotten that, we've been soft. What are your thoughts on that?
Iven Vian (38:31.406)
Yo man, at the end of the day you're buying a business. You're buying a business. You're not buying real estate. And people miss that. And people think that you can just buy this business, they sell you this dialogue at the big stage. You could buy this apartment, give it to a proper management company, go live on the beach, collect your check every month. That's a bunch of freaking BS, dude. Okay, let's just be real about this freaking thing. That is bullsh...
Can I say that on this thing? Okay, I won't say it. Yeah, man, but that's what's so frustrating. If we just confront the truth, because we do have our investors' interest in mind. If we confront the truth and say that this is a business and you have to look at it a business, approach it like a business, and we all know businesses have challenges. We all know businesses need the things that businesses need, right?
Ash Patel (39:02.078)
It'll get bleeped out. You're welcome to it'll get bleeped out.
Iven Vian (39:29.05)
vision, you gotta have people, you gotta have processes, you gotta think through it like that. The basic simple things in a business, if we approach it like that, we would, a lot of these issues we're dealing with, we wouldn't be here today. But people were sold this fricking story that you could just go buy a building, give it to a property management company, and the rest is history. What's even more baffling is, are we really the operators? No, the property management company is the operator, dude.
I'm not the guy on the freaking ground talking to tenants or signing leases. So it's funny, we call ourselves operators. You're a leader. You have to influence. You have to make sure people want to follow you. You have to put yourself in a position where people respect you. And the mindset has to shift. You're not, you're not the actual operator.
You're the person to make sure the property manager company is doing what they need to do. Think about that. We go through this whole process underwriting something, da-da-da-da-da-da, maybe we have a little bit of property management company influence, but once you hand that deal over, it gets rewritten all over again from a totally different perspective, using an operational budget. Go through that process, which by the way, I teach people how to do this, and it gets rewritten again.
And what you underwrote and you spent the past four to six months thinking you're gonna have this whole plan, how it's going to be, you give it to property management company and the whole fricking thing changes because they never understood it from a property management standpoint. They're the operators. And so what I'm doing is I'm bringing the property management company to the beginning of the conversation, more into the fold to hearing what it's like in ground reality to actually execute these deals and to bring that corporate knowledge, that real world understanding into our underwriting models. So it's a seamless transition.
It's not we underwrite from a financial perspective, then we underwrite it again from an operational perspective. No, we understand this from operational specs, but from the beginning, then you don't have, you know how many times the labor, I was gIven Vian this, and then once I get the property, the labor ends up being this. You know how many times I was told insurance or that's, you know, maybe rent growth was gonna be this, or income is gonna be this, and I give it to the property manager, like we can't do that. It's gonna be this. Why? Because the person at the property management company underwrites these deals.
Iven Vian (41:53.058)
It's one person that shop that doesn't actually take ownership of the thing. They have to underwrite a hundred of these things for all their clients every day. It's not until it gets down to the regional level, the ground reality level of the person actually implementing the plan to get that insight and that information. And so if you understand that and you have taken time to develop relationships with that person, guess how many more better deals you're going to be able to buy going into the future. Man, think about that.
Ash Patel (42:22.163)
Yeah.
Iven Vian (42:22.51)
This is me off that we've been fed this line and it's just not real. And so I'm bringing reality to the marketplace and I'm calling it out, but I'm also giving you the solution. I'm giving you the solution. And it's time we face reality. If we want to, if we want to keep the trust of our investors and have a future for tomorrow, then let's stop fricking pretending like there's not this huge gap here. Let's stop pretending that this isn't real. Okay. We have to, face reality if we want to have a future and if we want to have investors continue to believe in this business with us.
Ash Patel (43:00.358)
I love it, man. You know, I thought about two additional components that you can add to your business, and if you don't already, one is essentially a mercenary. When that person has a deal that's going underwater, the world's coming down on them, their investors aren't getting paid, lenders knocking on their door. Like you said, man, it's fixable, right? Stop the bleeding, or it's addressable. Stop the bleeding first. Be a mercenary for hire in those situations. And then I'm also thinking of the syndication teams or just any really, any company that is operating well, but could be operating at a higher level based on the things that you just said. You ought to hire yourself out for those opportunities.
Iven Vian (43:50.65)
Well, I'll give out my contact information at the end of this podcast and
Ash Patel (43:54.014)
Yeah. And dude, unfortunately, um, we're hitting our limit on time. Um, I look, you know me, uh, I'll see you at the best ever come back anytime. And I want you to next time you come back, if you have an opportunity to Iven, let's deep dive on maybe a turnaround story, right? Uh, an example of where you went in and stopped the bleeding, slapped everybody around with the
Iven Vian (44:22.278)
Let's do it, man.
Ash Patel (44:23.402)
Yeah, I'd love to get into a deep dive with you, brother. Tell everybody how they can get a hold of you.
Iven Vian (44:29.486)
Absolutely. Come join my Facebook group, Apartment Ninja Warriors. My Facebook group, Apartment Ninja Warriors. I drop in daily tactics, tools, tips, content in there for you to apply to your business in today's environment. See you there.
Ash Patel (44:48.074)
Yeah. And best ever listeners, man. I've known Iven a few years. We met at the best ever conference, just an incredible individual. And I'm lucky to call him a friend. Iven, thanks for joining us, man. Best ever list. Thank you. Best ever listeners. Thank you for joining us. If you enjoyed this episode, please leave us a five star review, share this podcast with someone you think can benefit from it. Also follow, subscribe and have a best ever day.
