Our guest today is a man who needs no introduction; if you are an avid real estate podcast listener, you’ll definitely know this name. On this episode, we are excited to introduce Neal Bawa. Neal is a technologist who is universally known in real estate circles as the mad scientist in multifamily. He treats his $250 million-plus portfolio as an ongoing experiment of efficiency and optimization. Neal serves as the CEO and founder of Grocapitus, which is an iconic data-driven, commercial real estate investment company, and also serves as a CEO of Multifamily U, an apartment investing education company with over 5,000 students attending his multifamily seminars, and hundreds attending his magical multifamily boot camps each year. Tune in and join us today as we talk to Neal all about numbers, measurements, adapting, and succeeding. Neal shares a lot of key information and tips about using data to your advantage, reinventing and adapting to ensure your success, his opinion on the strongest asset classes, and what investors need to be paying attention to. He also unpacks the five ratios that you should be tracking, so stay tuned for all this and more!
Key Points From This Episode:
- Hear more about who Neal is, his background, and what led him into multifamily.
- Looking at data trends: the goal is to constantly be reinventing yourself because that’s what data tells us to do.
- Neal shares the top strongest asset classes, pre-and post-pandemic: e-commerce boom.
- How multifamily has stayed the average most favored class over the last six to seven years.
- Neal talks about how the pandemic has impacted the class C price: old versus new.
- What do investors need to be paying attention to, according to data, a year from now: no bad news in multifamily.
- Neal explains why the next twelve months are gold, even if bad things will happen after.
- Innovations that Neal is implementing now that keep him ahead of the curve: cameras, selling covered-parking, calculating and tracking key ratios.
- The five ratios:
- The number of leads that your property seized each week.
- The number of appointments that were set from those leads.
- The number of people that actually showed up at the property.
- The number of people that signed apps.
- The number of people that became leases.
- What things in his portfolio would he consistently measure: unit turn.
- Neal’s message to passive investors at this point: make sure your syndicator is both excited and afraid.
- The one question that every investor should be asking their deal sponsor: what was their worst deal and how did they deal with it?
- What Neal is most proud of throughout his career, thus far: is their employees and how their company has molded itself into an extremely customer-friendly place.
- A book everyone should read: The Miracle Morning.
- Neal’s number one key to success: measure everything, and adapt.
“I tell people, I am not in real estate. I am running a cutting-edge technology company that happens to be using real estate, that is really optimizing.” — @nealbawa [0:02:49]
“I think the key is that we understand the immense and astonishing power of data to create profit.” — @nealbawa [0:03:01]
“Cap rates have only gone down in the last eight years. So, everyone’s been cushioned by that. Yeah, that’s a zero-sum game. It ends at some point, and then it reverses. I think that there are not enough people that have seen that, experienced that, or understood what the kind of impact that would have on them.” — @nealbawa [0:12:40]
“The US is going to experience a historically large growth over the next 12 months. You’re never going to have any year like the next 12 months because the pandemic will be over in 30 days.” — @nealbawa [0:16:11]
“You cannot manage what you cannot measure.” — @nealbawa [0:33:16]
“A key to success: Measure everything and adapt. If you’re not adapting every day, you’re dying. You just don’t know it yet.” — @nealbawa [0:39:03]