TGCI 190: From Marine Corps to Developing and Managing Short Term Rentals

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Episode 190: From Marine Corps to Developing and Managing Short Term Rentals

Copy of EP #18 - 2 Guests

Summary

In today’s show, Pancham interviews Alex Jarbo – short-term rental developer and manager, host of the YouTube Channel Alex Builds, and founder and CEO of Sargon Investments.

Starting from building his first short-term rental property, he has scaled up his investment firm by continuously developing and investing in unique properties! With a unique business model, the perfect team, and being able to bring the experience to the property itself, he is closer to achieving his goal of developing 650 cabins and syndicating a 50-cabin community!

Excited to jump into short-term rentals? Learn from this episode as he expresses what makes short-term rental properties intriguing, the importance of having a mentor, receiving infinite returns on his properties, and automating his business system!

 

Listen and enjoy the show!

PanchamHeadshotTGCI
Pancham Gupta
Screen Shot 2022-05-23 at 7.56.27 AM
Alex Jarbo

Tune in to this show and enjoy!

Copy of Quote #00 - 1 Guest

Timestamped Shownotes:

  • 0:37 – Pancham introduces Alex to the show
  • 2:08 – Getting into the short-term rental business by building his first property
  • 10:09 – His current business model that gains a high percentage of returns
  • 16:49 – Management team and utilizing automation systems
  • 20:35 – Websites that are an absolute game-changer in the real estate industry
  • 26:42 – Prioritizing the guest’s experience aside from the property itself
  • 30:44 – On practicing multiple morning routines to be more productive
  • 35:11 – Taking the Leap Round
  • 35:11 – His first short term rental investment outside of Wall Street
  • 35:40 – Overcoming his fears through experience, analysis, and mentors
  • 36:47 –  Why being emotionally attached to a deal could lead to failures
  • 40:07 – Why rookie investors should vet their partners properly.
  • 41:14 – How you can connect with Alex

3 Key Points:

  1. Having the right mentor could help you get a gist of the industry and be able to succeed. Even if it is costly, the money you’ve invested would be returned 3-4 times over.
  2. Aside from having a well-built structure, the property has to be an experience in itself for the guests to fully enjoy their stay.
  3. The real estate industry might be delayed in terms of digital trends (which is not always a bad thing), but there are many digital marketing principles that may be applied to it.

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Read Full Transcript



Welcome to The Gold Collar Investor Podcast with your host Pancham Gupta. This podcast is dedicated to helping the high paid professionals to break out of the Wall Street investments and create multiple income streams. Here’s your host Pancham Gupta.



Hi, this is Joe Fairless if you want to diversify out of Wall Street investments and listen to The Gold Collar Investor Podcast.

 

Pancham Gupta  

Welcome to the gold collar investor podcast. This is your host Pancham really appreciate you for tuning in today. My guest today is Alex Jarbo. Alex is a short-term rental developer and manager he was born and raised in Detroit, Michigan, he served in the Marine Corps for four and a half years very, he was stationed in Washington DC as part of Marine Corps honor guard. He left the Marine Corps at 22 years old to pursue his career as a real estate professional. He’s the founder and CEO of Sargon investments and he has a goal of developing 650 cabins in the next three years. Alex holds an MBA with a concentration in real estate development and is currently finishing a Doctorate in Business with a concentration in leadership. He is the host of YouTube channel; Alex builds where he teaches the ins and outs of short-term development and management. Alex, welcome to the show. 

 

Alex Jarbo  

Thanks for having me on. 

 

Pancham Gupta  

Super excited to have you on here and talk about short term rentals. That’s one topic that has come up so much, especially after COVID when people actually wanted to go and find different places to live. And I know personally, my brother-in-law lives in New York City, he went out to Hamptons. And he did an Airbnb for three months in the summer. So, it got exploded, especially after COVID. So, before we get started, are you ready to fire up my listeners break out of Wall Street investments? 

 

Alex Jarbo  

Let’s do it. Let’s do this. 

 

Pancham Gupta  

So, before we get started, like tell my listeners about your background and how you actually got started into this short-term rental business.

 

Alex Jarbo  

So, I was served in the Marine Corps for four and a half years that was mainly stationed in Washington DC and sort of towards the end of my enlistment, I just got to a point where I started just wanting to branch off and do my own thing. So last year in the military, I was looking at the different types of things I could do. And then I came across real estate and then just started doing a lot of reading on real estate different types of like the different classes of real estate. And yeah, I just came across someone on YouTube that was doing short term rentals. This was back in 2016, no 2015. And it just intrigued me I like what caught me was like the creativity of it. And also, just the cash flow. I mean, the cash flows even back then were crazy. I mean, even today, they’re getting better. So, I had that person I was following at the time, I had reached out to him, and through his YouTube channel and scheduled like a one-on-one call. And just like had paid him for his time. We were talking about different markets and blah, blah. And he was actually the one who helped me get recommended three different markets for short term rentals, because that’s what I decided I wanted to get into. And one of them was Asheville, North Carolina, and at the time I was engaged now I’m married. But my fiancé absolutely loves the city. And then I mean, there’s just so much to do here. But it was also just a solid, short term rental market as well. So yeah, moved here, got my real estate license, I was a real estate agent for a couple years, didn’t really enjoy it that much. I mean, I was just helping people get short term rentals or purchase short term rentals or invest in them. But I wasn’t, I wasn’t doing any of it. So, I decided to purchase my car, I decided, okay, I want to actually do what I moved here to do. So, I was I started looking at different properties. my price range was not that high. It was like under 200,000 At the time, so six, seven years ago. And I just couldn’t find anything in my price range that I felt like would do well as a short-term rental. So, I just decided to build my first property. So, my very first real estate investment was a new construction development 900 square foot a frame that we still own to this day. And just one turned into two to turn it into for a startup, bring it on investor capital from friends and family initially. And then this year, we’re working on 17 developments. And then we also purchase as well. I like to purchase properties that have some acreage tied to them where we can develop more properties next to them. But yeah, that’s essentially how I started and now my full-time gig is just development and management of the property. So, I don’t I don’t push off the management to a third party. We take care of the management in house.

 

Pancham Gupta  

Like the short-term rentals. Yes. Yeah. Got it. Got it. Well, I have so many questions on all of these things that you mentioned. I know I was a quick background there. So, you were stationed in DC, and you started listening to Some YouTube channels, you get intrigued. And you kind of call the guy who you like on YouTube, right? And then you actually pay him Did you hire him as a coach?

 

Alex Jarbo  

Right? Just a couple, just a couple of sessions. It was like maybe 200 an hour for this time. I’m sure now it’s way, way, way more. But it was just initial questions that I had, I had a general understanding, I had read a couple of short-term rentals are probably the only two short term rental books at the time, there weren’t really too much like content, book wise. So, I had, I knew enough that I could have a working conversation with someone about short term rentals, but not to a point where I felt completely comfortable like diving into a market.

 

Pancham Gupta  

Yeah, no, that is quite awesome. Like, you know, one question I have here, which more for the audience, a lot of people kind of feel, it’s very hard for some people to actually go out and pay someone to get that kind of knowledge that you did. Right. So, did you have any hesitation about that? Or you were just like, oh, you know what, that was just natural for you? Did you have to train your mind to kind of? Yeah,

 

Alex Jarbo  

I would, I would say no, because of the Marine Corps, like I understood the importance of having a mentor, because I had so many great mentors when I was in the military. So, I was coming from that background of just having the right mentor can set you decades ahead of your competition, or whoever were, where you are currently, not even your competition. So, I understood the importance of having a mentor. Got it. And as I became more successful in the last six, seven years, I mean, just the, the amount of money that I ended up ending up spending on mentors is directly correlated to how much success I’ve had. I’ve had met one on one mentors that I paid 30,000 a year to, but I know that I’m going to make that money back three or four times over in the year. Yeah, it’s

 

Pancham Gupta  

so true. I’m glad that you mentioned that. And the amount. If someone asked me like how much you’ve spent on your education, and I tell them, I tell them that I have probably spent more money after I graduated from my master’s. If I were to combine all the money from kindergarten to my masters, and add it all up, I’ve spent more than that, just in one year, has meant to hire someone to help. And then like you said, it is paid X number of folds, like in some cases, 10 folds,

 

Alex Jarbo  

and especially in the real estate game development, even like even more mistakes made money, and especially with these bigger deals that you want to tackle. I mean, it’s pretty easy to get set back 10, 20, 30,000. Because you just don’t know what you don’t know. And that’s what a mentor can help you with. And what I realized over the years, is there’s a difference between say, like a course. So, like just purchasing a course, maybe $4000 – $2,000, then being in a mastermind and then having a one-on-one mentor. And then you can have a one-on-one mentor in different parts of your life, whether it be mindset or your actual business, say like the business operations.

 

Pancham Gupta  

Exactly, exactly. So going back to your story. He mentioned three markets. One of them was Asheville, North Carolina, you remember the other two,

 

Alex Jarbo  

somewhere in Delaware that looked very similar to where I grew up and gloomy. I don’t know. I just that was that was the only other market that I remember. I think the other one might have been like Destin, Florida, which is still a phenomenal short term rental market. I figured that Asheville is a little less seasonal. Like it’s a year-round market. We still have our high season here. But I mean, I still cashflow pretty good in the winters as well.

 

Pancham Gupta  

Yeah, yeah, exactly. Okay. All right. So now you went there. You moved to Asheville, and then you, you know, you were priced out pretty much you said, okay, let me develop. How did that come about? Like did you go out start looking for land? Or did you find someone who was already developing, and you just bought something that was already in the works? Like how did that happen?

 

Alex Jarbo  

Yeah, so I was working out at a gym here. I was working very part time as well as a personal trainer while I was doing the real estate thing. And one of the personal trainers had just gotten his GC license. He was already a GC for or not at GC. He’d already worked in construction for 20 years but decided to get his license. And he got his GC license to help or to build his family’s house like a house for his family. And I sort of stepped in the middle. I was like, hey, would you like to build this for me make some money and blah, blah. And he agreed to it. I mean, we still five, six years later, we still have like, we’re still doing bigger and bigger deals together. But yeah, it was that and then I already had my real estate license. So, I had an understanding of how to purchase a property. But I did bring my GC along with me for the first couple of deals. The first couple of weeks. Yeah, just so I did go out and purchase land and we can talk about like the right way to purchase land and stuff in a second year. But yeah, that’s essentially what I did is a GC sort of fell in my lap a little bit. Not fell in my lap but I just I had approached him, and he agreed to it. It wasn’t a massive project. It was just the project that was in my price range home and at the time, you can get new construction loans with 10% Down where you could tie the land into the loan today with the lending environment and interest rates going up that sort of going away temporarily.

 

Pancham Gupta  

Right? Alright, so for anyone listening, right? How does this model work for you, if you can define one project, pick whatever? And if you can use numbers on like, what it cost you to buy the land and build and then cash out refinance that particular after it. Yeah, absolutely. And what your payment was, and now after you do short term rental, like what kind of returns are your kind of?

 

Alex Jarbo  

Yeah, so let me take everyone back to sort of the principles of developing sort of these unique properties. So, we developed a frame, or what I realized is log cabins do really well in mountain markets and wooded markets. So, what is it an A-Frame is literally like imagine like a church, like literally like an A frame is, like got it? The property is like for people who are just listening. It’s like, I’m creating a tribe. It’s a triangle, it’s a triangle is what I call them, but they’re very unique. And what I realized, and this so Airbnb just went Airbnb is one of the places we list our properties. Airbnb just had a massive update; they do their summer update every year. And it’s sort of played into our strategy of what we do. So, I like to develop unique cabins. So like what makes them unique, so or whatever, realize a frames, some sort of theme, like to the property of a log cabin does something about log cabins, mountain views in a hot tub, like people, that’s what they like, if you’re on the coast, you want to be close to the water and blah, blah, blah. But what I realized is people who are coming into the short term rental game, they’re just going into any type of like hot market and purchasing any type of property, whether it be like a small little property that a family would live in calling it at a cottage or a tiny house and just renting it out as a short term rental. For now, that’s going to do well but I can I predicted three years ago, four years ago that I think that as more and more properties hit the market that the unique properties are going to do better. And last week, Airbnb had a massive update, where you can actually choose instead of choosing like your dates, you can choose your dates, but you can essentially not put a location in but choose like if you want to do a cabin or a friend there’s actually a button you can click for a frames now but and Treehouse is on all these different unique stays, and then it will tell you like how close the property is to you, depending on an actual address, but I’m a huge believer in before I go through the numbers I’m a huge believer in the property has to be an experience in itself. I call him like Instagrammable properties that that for some reason the property ends up doing way better than if I just built a normal house. So, with so with the first a frame we built for about $200 a square foot roughly all in all the 900 square foot cabin that can sleep six people so it’s two bedrooms and then so the bedroom upstairs bedroom downstairs and then a queen pullout couch like a nice clean pullout couch. And sleep six people very open floor plan even has a balcony on the inside. That one all in all with purchasing the land cost about 250,000 to build. Our mortgage payment was before I refinance was $1,200 a month if you don’t include cleanings because the guest pays the cleaning, with internet electricity and everything our bills were probably about 1500 a month. And it was cash flowing. It still is in the summers about 7000 a month it grosses. And then during our high season, which is leaf season, it can push close to nine grand, which is what it did last year. So

 

Pancham Gupta  

you’re netting like seven grand in the high season and five grand in proximately.

 

Alex Jarbo  

Yeah, a month. So last year, we netted about 52,000. And my initial investment on that, again, they don’t the loans right now are anywhere between 70 to 75%. They’re not the mythical 90 that I got. But I think I’d only put probably 10 grand into furnishings and about 16 or 17,000 down initially. So, say 30 grand around number I was in at about 30 grand. And the first year we netted 52,000 or 50,000, the first year. So, I mean 100 And whatever percent return ROI on our cash. And yeah, the cool thing about the land, I learned a lot with just there’s a lot of money in land investing as well. So, I learned some of the intricacies when it comes to how to structure a deal like a land deal. So, this specific parcel was two-acre parcels that were connected to each other. And we’re purchasing them for 45,000 for two-acre parcels and they had they both had a Mountain View and we were able to get one side to appraise for essentially the so two acres to appraise for the purchase price. We’re essentially, we were able to write a contract for $1 For the other parcel, and we essentially got the other parcel for free at closing. And then I just turned around once I got my certificate of occupancy for that First cabin, I just turned around, went to another bank, and use that land as down payment to build two more cabins. So, my ROI on those cabins is infinite. Because just the money besides what I put in furnishing costs, that’s practically infinite, which is crazy.

 

Pancham Gupta  

Yeah, that’s pretty awesome. So now you have fast forward, you are doing the same thing. Why change anything that’s working? Right? So, you’re onto your 17 projects? He said,

 

Alex Jarbo  

Yeah, what I really what I realized is, and this is I’m not gonna get too into detail with like, my county rules and everything. But, if you build more than 10 cabins in the same area, in terms of like, everything’s being adjacent to each other. So right next connected to each other, you need to get a hotel permit. So what I realized is the best use of my time, as long as I can raise the capital and qualify for the loan, my GC can take on the work, the best use of my time, is, there’s no difference between me going out and looking at a two acre parcel or looking at a 15 acre parcel, it’s the same amount of time I’m spending, there might be a couple extra steps, but it’s all done in an office. For me, when it comes to looking for the land, it’s really not that big of a difference in time. So right now, I like to do anywhere between two cabins if the numbers work, but I really liked to do like six cabins at a time, which is what we’re we have two projects that we’re doing six at a time. And other projects that we’re doing, say like four at a time, just because like if we did six, they’d be clustered together. But yeah, just essentially, I slowly grew over the course of say, like, the last six years, but I didn’t go like crazy. But I do eventually want to do say like a 40 to 50 cabin community. I’m calling it like a Boutique Resort. Or in the next six months, I’ll be putting together a short-term rental fund and syndicating a deal like that.

 

Pancham Gupta  

Nice. All right. So, let’s talk about the management side, right? You’re local to your own market, right? You’re not doing remote management. So, do you have a separate team? Initially, when you started. Did you have just you who’s taking care of your listings, and you probably had a cleaning crew come in afterwards and clean up and all that. So how much of your personal time were you spending back then? And what do you do now when it comes to management?

 

Alex Jarbo  

Phenomenal question. And this is this, I can show you the two big differences between we closed on a property a couple of weeks ago, beautiful 3200 square foot log cabin. And that one can sleep like 12 to 14 people. And the difference in systems between my first cabin that my A frame compared to this one is night and day, the biggest thing is I’ve hired out although, so I ship everything to the property. And if the like in terms of the furniture in terms of everything from Amazon, Walmart Wayfair, everything is I don’t touch any of that. And then if I’m developing, it goes to say like a warehouse that I just pay like a monthly rent for. And then if it goes to a warehouse, if it goes to the property, I’m hiring people to put together the furniture that was a big thing that was taken a lot of my time is I essentially have a checklist of everything. And you’ll be surprised a lot of the stuff especially in today, there’s a lot of automation tools. So, automating your messaging, automating your check in process, I played with the idea of hiring someone boots on the ground for a very long time, like an operations manager. But after talking to multiple mentors, I just came to the end talking to a lot of people. I’m a coach for a short-term rental mastermind as well. And talking to some of those coaches that are in the mastermind, I just realized I didn’t need an operations manager Boots on the Ground Operations Manager. And the reason being is because your cleaning crew is up there two to three times a week anyways, they can inspect the property for you, you just have that conversation for them and pay him a little bit extra. Your boots on the ground for me or my boots on the ground is my cleaning crew. And then if something goes wrong, I have a part time maintenance person. Outside of that you don’t really need anyone, especially now you can hire virtual assistants that have worked directly for Airbnb and Marriott in the past, you can pay them a little more, but it’s really not that much like I realized that realize just me learning through another coach in this mastermind, that you can hire these Airbnb Marriott who have their previous employees with Airbnb and Marriott for relatively cheap, and they can handle any each virtual assistant can handle anywhere between 12 to 15 properties, just on the messaging side. So, most of my messaging is automated. And then say like the 20 to 30% That’s not automated, someone else takes care of it. But when it comes to having people on staff, I really don’t have a big team. And I mean, I’ve done that on purpose. Just because I mean, I’m having an obsession with automation at this point. Like my GC is not an employee of mine. He could be an employee of mine, but just it gives me more flexibility and obviously gives him more flexibility as well. But yeah, my team is not that large. My cleaning crew is not i sub that cleaning crew out to a third party essentially like it’s not done in house. And then I just charged the guests just gets charged the cleaning fee. Right? Yeah, I’ve been able to scale pretty significantly without having like on staff, anyone besides, honestly a partner, part time maintenance person. Now once I get to 50 properties, I will probably have an operations manager of Boots on the Ground Operations Manager. But the beauty about the market that I’m in right now is you can go and out if you draw an hour and a half circle driving distance, there’s about six to seven other short term rental markets within that hour and a half that an operations manager can go to. And that’s the beauty about mountain markets and stuff.

 

Pancham Gupta  

Got it? So, question on that furniture stuff, right? Does every single one of the cabins look the same? If not, like, who does the interior designing part of it? Like, you know, right? Like, it’s an art to really have? You must have an eye for it. You do. And then you have a list of items already that you want to purchase, right? And we just go and boom, boom, boom, order and done. Look at this instant, or is it like very unique to that property? Every single time we must come up with some new stuff. And who does that?

 

Alex Jarbo  

Yeah, so good question. And I recently started using this again, I think real estate, the real estate industry is usually the last industry to catch on to that stuff. Which is not a bad thing. It’s just real estate’s a permanent asset. Like it’s not like it’s not like crypto or stocks where you can easily move it around. And I just ran into this with I had a hot tub delivery today when I wasn’t on site, and they wouldn’t take a credit card. They were just like cash or cheque. So, it’s a real estate’s a very old school still, especially us here in the mountains. But going back to your question about interior design, so there’s a service and everyone can use this here is called Modsy m-o-d-s-y.com. And you can literally, they have an app, you can scan your entire property for them to take videos, it’s $350 for a two bedroom or three bedroom, two bath, and I think it’s like $40 extra per bedroom, you scan everything, and then you are assigned to a one on one interior designer who puts together everything for you. And then they will send you all the links and their affiliate links so that they make money on the back end there, which is completely fine with me. And then they will also give you discounts on top of that with like Wayfair whoever, if they find it, I don’t know if they worked through Amazon, they might. But I’ve only used them for like the big items like Wayfarer and stuff. But that can get you about 70 80% there. And everything else like in terms of I like to color match all like my kitchen stuff. So, like, if it’s a law cabinet, I like to go with like cups with like a 10th or something went on. But on the interior design stuff I was getting quoted a percentage with some people like locally, they were like, okay, 5% of the project 10% of the project, almost like a GC. And that was just too much if I have if I have a budget, say like a large project, and I have a budget of like thirty-five grand to furnish a five-bedroom property, I don’t want to pay five grand to an interior designer to put everything together. So Modsy’s been a game changer for me on that. And, and I am constantly looking for new tools anytime. Same thing with like, going on the construction side, putting together our floor plans and everything. So I’ll get like I can, if I find say like a floorplan or a property that I like on Instagram, I found a service that I don’t know where they’re based out of, but I can send them that property that I just have a picture of, and they can put together a floor plan for me, it might not be 100% exact, but we can play around with the actual floor plan but everything’s service. So, it is called, it’s called Getasiteplan.com. We originally used it for site plans, but they also do floor plans as well. But again, going back to the interior design thing, Modsy has been an absolute game changer. And on top of them recommending what it should look like they will literally send you the links of everything as well. So, you buy Add to Cart Add to Cart, I use Wayfarer professional as well. So, people do not know, there’s a business side to Wayfair where you’re assigned, and account representative actually talked to mine this morning. It is a completely free service, but you just need a business EIN, which is really simple. It is just a business license. And they ask you what industry you are in. And then based off that they customize your dashboard for you. So, my dashboard shows short term rentals and hotels. And what you can do is you can send your representative pictures, say like you work with Modsy, and you can use those links but there are some things that like I just I did not like that Modsy had done say like just one bedroom. It was not the whole property. So, I called I called my representative up and said Hey, this this is what the property looks like. I emailed her pictures. If you can find me things that are similar to that and within like 24 or 48 hours, I have a list of things that I can choose from based off of a price range I have and everything so way for a professional has been super helpful too and they can get you discounts as well beyond normal Wayfair

 

Pancham Gupta  

wow, I learned so much from that. Hey,

 

Alex Jarbo  

Let me ask you a firehose.

 

Pancham Gupta  

That fun mod. See, let me ask you know this is where I am getting a little selfish. And I’m asking

 

Alex Jarbo  

everyone at the end of the day. So,

 

Pancham Gupta  

Modsy? Would you use that service? If you want to use your own home? Or would you design your own home? Or would you in that case prefer an interior designer?

 

Alex Jarbo  

Yeah, so I have asked them that question. So, they’ll only do the interior design after you sort of have an idea of what the structure looks like. So I’ve honestly lean pretty hard on Instagram and Pinterest, if I see a property, like I screenshotted added to a folder on my, on my phone, and then from there, I’ll send those pictures over to the floor plan people, they can get the floor plans done within like, I think 48 to 72 hours, just ridiculous timelines, especially now coming out of COVID, I feel like things are still a little slow to find people who can do floor plans for you at a 24 hour notice within three days, it’s crazy. So, I, my whole process is pretty simple. And it it’s not like you’re gonna read this in a book, it’s, I do screenshots of properties that I like, I send them over, I get floor plans done. And I’m constantly having floor plans done, I have projects that are constantly, just like I have like maybe 30 floor plans here behind this desk array, or the This dresser right here. And from there, I send the once the floor plan is done, I send that to Modsy. And we can talk about like a color scheme and everything. Or I can just wait for the property to be actually built, and then do that. So, I have a general budget of what each bedroom like anywhere between 1500 to 2000 are dedicated to a bedroom.

 

Pancham Gupta  

Got it? Got it. Well, that’s great. So, this is awesome. Do you have any other things that you want to talk about? Before we move on to the second part of the show? I do have one more question for you, but totally different.

 

Alex Jarbo  

I would say for the biggest thing, who are people who are trying to go out and actually do this themselves and actually say two more things before your last question is, when you’re trying to do this yourself, think about the guest’s experience, not just the property itself. So, like we live in mainly a driving city, we have a small airport, people are mainly driving to our market. Always think about the guest’s experience. So what is the drive look like to the guest, you don’t want your guests to be driving down 2030 minutes down a gravel road, they’re gonna get annoyed before they even get to your property, a lot of times they’re driving in at night, they just came off a road, they’re coming in at the end of their road trip, they’re in a new area that they don’t know, you don’t want them to have like a little sketchy drive to the property. So, I always like to be off of a double lane state-maintained road. And that’s been a game changer. And obviously, having high speed internet, even with the smaller properties is very important. So that plays into our land analysis as well. And the final tool that actually use that you had said a lot of people who are listening are in the tech industry, I use a service and I think some of your listeners will appreciate the service, I use a service called StayFi. And what StayFi is it’s a little disc that plugs into the back of your router. And what that does is you can set a landing page for imagine that you’re going to Starbucks or going to the airport, you have to log into the Wi Fi. To use the Wi Fi, it’s the same thing here, people have to put in their email addresses, you do get the email address of the person who actually books the property. But say if you have a property that it’s like 14 people, you’re not getting all their email addresses. So, it’s email capture, it also protects you from the guests doing anything illegal on your thing, but it also makes it look legit and very professional, we have a custom landing page for each one of our properties. It’s a very cheap service, I think it’s like $10 a month per property. But that allows us to then remark it to our guests outside of Airbnb and VRBO, which is a very powerful tool. Because I can see that like some people do get annoyed with the service fees that come with Airbnb and VRBO, mainly on the guest side of the guests pays a big portion of those service fees. And we’re working in the next year to put a back-end platform a direct booking platform that the guests can actually use. So, they come through us through Airbnb VRBO. And then we get their email address. And then we send out maybe seasonal emails like one every three months leading up to say like a fourth of July or something, hey, if you want to stay with us, blah, blah, blah, like you can save this much in service for us. And I think things are coming full circle with the short-term rental stuff because that’s originally how it used to be the only way to get a short-term rental was to actually call the place and book. So that’s a bit of full circle but we’ll always be using Airbnb and VRBO, but we like to it’s not illegal to take them off the platform after they’ve stayed with you. It’s illegal to try to do it before they book with you through Airbnb. But there’s nothing wrong with taking them off of Airbnb after they’ve stayed with you.

 

Pancham Gupta  

Right. Those are some amazing tips and anyone listening you know want to kind of find out how to run Airbnb. Alex is the man here, especially if you’re managing if you’re local. You know I had one guest long time back. I don’t know if you know, Tim Halbert it was in the 40s he managed his properties in the US and he lives in Medina Colombia. So, it’s a completely different way of doing this, like you know, Airbnb. So, but that StayFi thing is so cool. I actually didn’t know that. And that is definitely makes it look very legit. And then now you can remarket, then that email addresses. So, it’s

 

Alex Jarbo  

like you’re applying digital marketing principles to real estate again, real estate is slow to catch on to these trends. So just reading like the Russellbranson.com secrets, the secrets trilogy and stuff that’s like, okay, how can I apply these digital marketing principles to my real estate business?

 

Pancham Gupta  

Right, right. Well, Craig, thank you, Alex, for that. Let me ask you this. One last question. Do you have a morning routine that you follow? If so, what is it? And do you think that it attributes to your success?

 

Alex Jarbo  

Yeah, actually, I follow the Miracle Morning by Hal Elrod. I can’t really see that picture back there is when I met him at the Bigger Pockets conference right there. But that was really cool. I’ve been practicing that for seven years. I haven’t been on it recently, the last couple of weeks, I will completely admit to that. I’ve just I’ve just been so busy with my other deals like I’ve just been getting up at the time, I usually get up and going straight to work. I know what I need to achieve. Sometimes. I use the Miracle Morning to sort of reset my compass if I feel like I’m sort of getting out but for people who don’t know Miracle Morning, there’s, it’s the acronym is savers. So, silence Affirmations, Visualization, exercise, reading, and then scribing just being writing scribing. I do the five-minute journal. silence I actually do the Wim Hof Method for the silence the meditation because I can’t my brain scattered and scattered all the time. I can’t just sit and sit. So, I do the Wim Hof breathing techniques. And then the all the other stuff is just what the book, The Miracle Morning teaches. But scribing the five-minute journals has been really cool. I can take that book with me anymore. And then Wim Hof. It’s just that takes me about 10-15 minutes was just how long would it be for meditation anyways, and then yoga, I recently took up yoga at the end of my day just helped me de stress a couple times a week.

 

Pancham Gupta  

Got it? Well, savers have been a savior. For me, and believe it or not, I use five-minute journal to. And I’m pretty religious about it.

 

Alex Jarbo  

Yeah. And what I love about that is you mentioned morning, what’s incredibly important is also sitting down for 10 minutes the night before to play, especially if we’re entrepreneurs, and just in any type of industry, but definitely entrepreneurs where we have to essentially create our own schedule, at least when you’re first starting. But it’s super important to sit down for 10 minutes in the evening of leading into the next day and just plan out your day that will set you up even better for whatever morning routine you have.

 

Pancham Gupta  

Absolutely. I can’t even tell you so many, you know, you can say they were all coincidences, but I’ve written stuff the day off in the more and more on that. I hope like you know, you know, there’s this question. Second question, which is, what would make your day great or something like that? Yeah. What would you have done differently? Or whatever? Maybe, yeah, whatever that was. So, I would write something and really visualize it right. And it happens. It just happens. And it just, it’s crazy. Cool. Well, thank you, Alex. We’ll be back after this message for the second part of the show. If you’re an accredited investor and have been thinking about putting your money to work for you, then I have good news for you. I have created an investor Club, which I call the gold collar investor club, I will be putting together investing opportunities exclusively for the group. These are the opportunities where I have done the due diligence for you and will be investing my own money alongside you. If you are interested, please sign up on thegoldcollarinvestor.com/club. I repeat thegoldcollarinvestor.com/club. I will reach out to schedule a 30-minute phone conversation to discuss your investing goals. Once you sign up. This can be a good opportunity to diversify and take some chips off the hands of Wall Street to produce some passive income. And in case you were wondering, what is an accredited investor? Accredited Investor is someone who has earned more than $200,000 as filing single or more than $300,000 Filing Jointly for last two years. Another way to qualify as an accredited investor is if your total net worth is more than $1 million, excluding your personal home. It includes your stocks, 401, K’s IRAs, cars etc. Just not the equity in your personal home. If This, is you, I would highly encourage you to sign up? So, let’s move on to the second part of the show. Alex, this is I call taking the leap round asked you for questions to every guest on my show. My first question for you is when was the first time you invested outside of Wall Street? Was it that condo or not that a frame that you belt?

 

Alex Jarbo  

Yeah, that was my first one. I did the retail arbitrage method a little bit for Airbnb. That’s how I sort of saved up the down payment for that first property. But the one that actually weren’t my name, or my business name was on the mortgage. That was my first A frame. Which we are like the crown jewel of our not the crown jewel, but definitely the one that does really, really well.

 

Pancham Gupta  

Got it. Did you have any fears that you had to overcome when you actually build that? You had a new TC? Oh, yeah, I’ve said it before.

 

Alex Jarbo  

I think there’s a major misconception that like people who are successful don’t have like fears of like, I think the fears tend to go away with experience, especially with some success, and then also going through some failures too, and coming out of those failures. But I definitely had fears developing my first property, because like, when you’re breaking ground and putting in foundation, you never know what you’re running into, until you actually do it. But I mean, that’s where you lean on the team.

 

Pancham Gupta  

Yeah. How did you overcome that? Did you like your mentors and all that?

 

Alex Jarbo  

Yeah. I mean, it’s one of those things to where you just you do your analysis, you put a contingency in place in your budget, like say, like a 10% contingency, that’s usually pretty normal. Every lender handles that a little different word built into the budget. But that can help you and then just getting on the business side a little bit, just having access to lines of credit helps to like business lines of credit, or in case you do go over. That helped me and then just Yeah, mentors just telling me that it was either doing the right thing or the wrong

 

Pancham Gupta  

thing. Got it. Got it. So, my third question, can you share with us one investment that did not go as expected?

 

Alex Jarbo  

Yeah, that’s actually a recent one. So, we were purchasing for properties. And I never get a property, I never present a property that is not under contract. And that’s been a rule that I’ve followed, that I’ve never been burned on. But I just didn’t want to be embarrassed, I will never present a project to an investor if it’s not under contract. And that’s to people who have been in real estate. That’s pretty normal. And I broke that rule very recently, a couple months ago, and I just got burned for it. It was four properties it was right across; this is five minutes away from the city. And it’s also right across the street from an $18 million park development that just happened that they just opened this park of the city park, four brand new properties that were built as short-term rentals, all in the same area. Like they’re all right next to each other. The deal was for like 2.4 million. And I needed to find an investor to bring about seven or 800,000 to the table, I had a list of people that I called. But the sellers were just dragging us on to a point where like four or five weeks of constant follow up between me my agent and then ended up getting to a point where I actually met all the partners, there were four partners in the deal. They built these properties as short term rentals. And they just ended up stepping away because their budget was done prior to COVID. And then things just went crazy, obviously. And I shook all their hands, which I never I usually never meet the sellers of these deals, and personally until we’re under contract at least. So, I shook all their hands, we agreed on terms agreed on price agreed on timelines, due diligence, earnest money, everything. That was a Friday that we said we were going to get under contract Monday. And then during the weekend, they ended up chopping my deal around to other people like, so they just took whatever my terms were, and they shopped it around. And they essentially told us that like they were in a multiple offer situation like that one day with like four other people. So, I felt pretty much pretty burned on that. And then during the weekend, I had presented it to an investor that was ready to essentially go through with the deal. Show him my pro forma and everything. I showed the investor my performance method sellers. But yeah, that was the deal that I recently got burned on. And I learned the lesson of sticking to just never presenting a deal to an investor is just embarrassing, and the deal falling through. And to just I think one of the most important things is when you’re first I mean, I’m not first starting, but when you’re first starting, or you’re just not falling in love with the deal, and I’ll tell you it is very hard to do it. Because short term rentals are very unique, especially with the properties that we develop and purchase. It’s very easy to fall in love with the property because it’s not like you’re just purchasing an industrial property that you’re going to put a tenant in. There is a sexiness to short term rentals that I think people are attracted to. So, I think the biggest thing that I learned from that deal was just not getting emotionally tied to the deal. Because I let them drag us on for five weeks, I should have just put like a two- or three-week exploration on the offer. Yeah, that’s essentially what I learn. And beyond that, I mean, they didn’t necessarily do anything illegal. I just I we live in a very small city, and I’m sure I’m gonna run into these people at the grocery store. So, I mean, it’s like, is it was it really worth your name to do all that, but yeah, that’s the biggest lesson I learned from a deal that recently went south was just, just don’t get emotionally attached to a deal. Especially Now with higher interest rates, there’s going to be more and more deals coming on the market staying on the market longer.

 

Pancham Gupta  

Yeah, exactly. Exactly. All right. So, my last question for you, Alex, is that what is one piece of advice would you give to people who are listening or thinking of investing in Main Street that is outside of Wall Street?

 

Alex Jarbo  

Ah, so good question. I would say just make sure that you’re vetting your partners properly. For people who are looking to invest passively, obviously, there’s a lot of syndicators out there. And one of my good friends who has honestly turned into a mentor more of a friend both PAUL MOORE from Welling’s capital just wrote a phenomenal article on this and Bigger Pockets is making sure that you’re vetting your syndicators properly. There are so many people who are coming into the syndication game, whether it being short term rentals, multifamily self-storage, anything, just making sure that you’re vetting your partners properly, and they do have that experience. Short term rentals are a little bit different. Because they’re up until recently, there weren’t too many syndications in the in the short-term rental world, but just making sure that you’re just vetting your syndication partners properly if you’re going with a syndication.

 

Pancham Gupta  

Got a great piece of advice. Well, thank you, Alex. This has been pleasure. I learned so many new things here with you on the show. how can listeners connect with you I know you said that you are already have a YouTube channel or you?

 

Alex Jarbo  

Yeah, I have a YouTube channel called Alex built, I haven’t posted. I’ve posted a lot of my podcast stuff that I’ve done on there. But I haven’t really posted anything in the last couple months because I was redoing my whole studio. But YouTube channels Alex builds, it’s just a little logo of a treehouse if you look it up. And people also can reach out to me on LinkedIn. And then also my website, which is Sargon investments.com. Putting together a course right now on the real estate development side, or short-term rental development side, just because I essentially created a course or am creating a course, I wish this course would have existed when I first started, people are realizing short term rentals are a good investment. And that’s driving prices up. And one of the things that people are turning to is development of short-term rentals. So put together a little course there we have a waitlist on our website for that. And then between those three resources LinkedIn, my YouTube channel everyone listening should be good to go with the on the short-term rental stuff.

 

Pancham Gupta  

Cool. Thank you, Alex so much for coming on the show and sharing your knowledge. But for me, does this excite you to jump into short term rentals? It has definitely piqued my interest. If you have any interest in this definitely check out Alex YouTube channel and thank you for hopping on. I really appreciate you if you have any questions email them to me at p at thegoldcollarinvestor.com. That’s P as in Paul at thegoldcollarinvestor.com This is Pancham signing off. Until next time, take care.



Thank you for listening to the gold collar investor podcast. If you love what you’ve heard and you want more of Pancham Gupta, visit us at www.thegoldcollarinvestor.com And follow us on Facebook at The Gold Collar Investor. The information on this podcast are opinions as always, please consult your own financial team before investing

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