Listen to this episode of Unstoppable REI Wealth to learn how to make your real estate investing business thrive! Kenny Wolf, the Wolf of commercial real estate investing, shares his secrets to success, including the importance of underwriting, relationships, and networking. With over 9000 units under his belt and $650,000,000 under management, Kenny knows a thing or two about what it takes to be a successful real estate investor. Billy Alvaro, who started with no-How to get started in real estate investing-The importance of underwriting-The importance of relationships-The importance of networking-The importance of experience-The importance of returns Kenny Wolfe is an experienced multifamily syndicator, the founder and CEO of Wolfe Investments, and published author of “Investing in the Dream: How to Acquire Multifamily Real Estate and Attain Total Financial Freedom”. He invested in his first multifamily property in 2010 and instantly saw the potential for real estate to transform his life - giving him the opportunity to quit his day job and start a company. Key Points Approximately mentioned @ 00:00:01 Kenny Wolfe, the Wolfe of commercial real estate investing, has done over 9000 units and has $650,000,000 under management. Approximately mentioned @ 00:00:51 Kenny is syndicating a deal for a portfolio of 443 units in Texas. The portfolio is split between two properties in Houston and Sherman. The former owners have done unit interior upgrades for 50 units, and Kenny's team plans to do an additional 100 unit upgrades. The expected total return for investors is 114% over five years, with an IRR of 18%. Cash on cash should be 10% and return of capital by year two on a refi should be 30-40%. Approximately mentioned @ 00:07:43 Looking at a deal to see if it is worth taking through due diligence can be a lengthy process. However, by having a quick process to review the deal, it can help to save time. Approximately mentioned @ 00:19:59 Kenny Rushing of Wolfe Investments LLC shares his experience and expertise in real estate investing, specifically in multifamily and commercial properties. Approximately mentioned @ 00:19:59 Referral investors are key to a successful investment business. Thanking investors for referrals and providing a way for them to easily refer new investors are important methods for growing a successful investment business. Connect with Kenny https://wolfe-investments.com/ And after that head on over to... https://easysell411.com https://billyalvaro.com https://billyssecrets.com Who knows maybe you will be our next partner? To get some neat (and FREE) Tools | Tips | Tricks to help you in REI!
Listen to this episode of Unstoppable REI Wealth to learn how to make your real estate investing business thrive! Kenny Wolf, the Wolf of commercial real estate investing, shares his secrets to success, including the importance of underwriting, relationships, and networking. With over 9000 units under his belt and $650,000,000 under management, Kenny knows a thing or two about what it takes to be a successful real estate investor. Billy Alvaro, who started with no
-How to get started in real estate investing
-The importance of underwriting
-The importance of relationships
-The importance of networking
-The importance of experience
-The importance of returns
Kenny Wolfe is an experienced multifamily syndicator, the founder and CEO of Wolfe Investments, and published author of “Investing in the Dream: How to Acquire Multifamily Real Estate and Attain Total Financial Freedom”. He invested in his first multifamily property in 2010 and instantly saw the potential for real estate to transform his life - giving him the opportunity to quit his day job and start a company.
Key Points
Approximately mentioned @ 00:00:01
Kenny Wolfe, the Wolfe of commercial real estate investing, has done over 9000 units and has $650,000,000 under management.
Approximately mentioned @ 00:00:51
Kenny is syndicating a deal for a portfolio of 443 units in Texas. The portfolio is split between two properties in Houston and Sherman. The former owners have done unit interior upgrades for 50 units, and Kenny's team plans to do an additional 100 unit upgrades. The expected total return for investors is 114% over five years, with an IRR of 18%. Cash on cash should be 10% and return of capital by year two on a refi should be 30-40%.
Approximately mentioned @ 00:07:43
Looking at a deal to see if it is worth taking through due diligence can be a lengthy process. However, by having a quick process to review the deal, it can help to save time.
Approximately mentioned @ 00:19:59
Kenny Rushing of Wolfe Investments LLC shares his experience and expertise in real estate investing, specifically in multifamily and commercial properties.
Approximately mentioned @ 00:19:59
Referral investors are key to a successful investment business. Thanking investors for referrals and providing a way for them to easily refer new investors are important methods for growing a successful investment business.
Connect with Kenny https://wolfe-investments.com/
And after that head on over to...
Who knows maybe you will be our next partner?
To get some neat (and FREE) Tools | Tips | Tricks to help you in REI!
Billy Alvaro 00:00:00 What's going on? What is going on? Episode one freaking hundred today, guys admitted viewing Kenny Wolf, the Wolf of commercial real estate investing. Don't let this guy's soft spoken voice fool you. 9000 units over the last twelve years. Over $650,000,000 under management. Guy is a beast. I'm gonna call him the quiet, quiet intellectual beast. The guy is really is doing some amazing things out on the west coast in Texas and he's actually investing, to my surprise, in New York triple Nets. He's doing some lead some things out here on, the East Coast. So I hope you guys enjoy this interview. Kenny is really an intelligent guy. He's doing a bunch of good things and he grew his company freaking shit fast, man. 650,000,000 under management, twelve years. Hope you guys enjoy it.
Billy Alvaro 00:00:48 Welcome to Unstoppable real estate investing wealth. My name is Billy Alvaro, aka the Unstoppable BA, former billion dollar mortgage banker gone bankrupt, turn professional real estate investor, where each week you'll learn the tools, strategies, systems and secrets myself and other highly successful real estate investing entrepreneurs use to start, grow and scale their businesses, creating massive profits and how you can too. And we'll teach you how to put those profits to work so you no longer have to get ready to finally experience financial freedom and generational wealth. Now let's get started.
Billy Alvaro 00:01:28 What's going on everybody? Welcome back. Another episode Unstoppable Rei Wealth, the program that teaches you how to start, grow and scale your real estate investing business. I've been on a little bit of a rip here, interviewing a lot of guys around the country that are doing commercial real estate investing. And again this week I'm bringing the heat of mystic, Kenny Wolf, the Wolf of commercial real estate in uh, out in Texas. Um, I'm really going to enjoy this interview. He's done over 9000 units. He has right now, I believe about $650,000,000 under management. And he's only been doing this for about twelve years. So Kenny, welcome to the showroom.
Kenny 00:02:02 Thank you, Billy, I appreciate it. Excited to be here. Yes.
Billy Alvaro 00:02:05 You're a Texas boy?
Kenny 00:02:06 Yeah, I was born in Denver, but then moved to Texas about age eight and then it's been Texas pretty much ever since.
Billy Alvaro 00:02:12 So I'm loving it. So I want to skip how you started. I want to get right into the meat of this. You've only been doing it for twelve years. How did you scale as quick as you did in a twelve year time frame to do over 9000 units?
Kenny 00:02:26 really it's been, um I jumped from oil and gas investing to multifamily. I've never done single family, so I jumped right into commercial. And one of the big draws is really the scalability of it. And because we've done non recourse financing basically from day one in apartments that really, uh, allowed me to hire to buy bigger assets and uh, provide full time property management on site so I don't have to deal with the day to day operations, I can focus on growing their portfolio.
Billy Alvaro 00:02:57 So what does your business look like to structure kenny, how many people in your organization and how many partners do you have, if any?
Kenny 00:03:03 So we've got 17 here at our office, in the investment office, um, we also own, the management company and they're an hour away, thank goodness. That's where all the hard work is. Uh, but, uh, then they're pushing 200 people now because we manage for, office all of our portfolio and then also other others as well.
Billy Alvaro 00:03:22 Interesting.
Kenny 00:03:22 Yeah.
Billy Alvaro 00:03:23 And do you have partners in the business?
Kenny 00:03:25 Not in the investment side? Um, we do that all ourselves. Um, we did buy into a property management company. So I am 49% of that.
Billy Alvaro 00:03:34 Um, I'm asking you a partner because you keep mentioning we. So when you're referencing we, is it your business? Is it you and your spouse?
Kenny 00:03:40 Our company up here, yeah. it's wealth investments. I see us all as a team. That's why I do.
Billy Alvaro 00:03:47 I love that. So you got started. No experience. What was your first deal like when you went into this? Tell me about your first deal. Sure.
Kenny 00:03:55 So I did two passive investments first to learn the ropes. And I picked out a really rough property where the, pizza delivery guy wouldn't go to the property. It was that bad. Forget the fear of getting mugged. And then the other one was a Fannie Mae loan already. And so between those two, teamed me up for my third deal. Um, I syndicated. I've got 13 people together to buy 76 units here, in Dallas Fort Worth, and really, that really launched it from there.
Billy Alvaro 00:04:21 I love this man. I love it. Where did you go, Ken? You went from gas to investing. What kind of education did you get? Um, outside of school. Because I'm sure you went and you took some gurus course, you took some courses, you did something.
Kenny 00:04:35 Sure. Yeah, absolutely. so I'm an, alumni from, Lifestyles Unlimited, down here in Texas and then also Rat Race to Retirement. So Brad some rock he, broke away from Lifestyles and did his own thing. So I'm alumni from both of those.
Billy Alvaro 00:04:51 So it paid off to get the education. Obviously it did.
Kenny 00:04:54 It doesn't for everybody, but it absolutely did for me. So you, got to close the deal. For those that don't, obviously it's not good.
Billy Alvaro 00:05:02 Well, they got to apply themselves. Right.
Kenny 00:05:04 You got to want it pretty bad.
Billy Alvaro 00:05:07 Takes a freaking action, man.
Kenny 00:05:08 Right.
Billy Alvaro 00:05:09 So get into like 9000 units over the last twelve years. Quite a bit. What's your sweet spot types of deals? You like 50 units to 100 to 200. What does that look like?
Kenny 00:05:20 Really it's 100 plus. And really it comes down to who's going to manage the assets. So below 100 units, it gets a little, you have to get a little bit more creative on staffing. So on site management, on site maintenance. At, 100 units, you can roughly afford a full time manager. Full time maintenance. So it's below that. You just got to make sure you buy something that's, um, close by. Maybe it's a tack on, to some other bigger property that we have. We did that twice this year. Broke our rule by in less than 100. But they were so close to our others. That made sense. Really. That's the sweet side. And we buy everything from a class to Dclass. There's, not many that omit buying a D, but we'll do it because we're taking it to a B or an A. So it's basically a development deal. Yes.
Billy Alvaro 00:06:00 You're going in doing a full gut reno and repositioning the whole property.
Kenny 00:06:03 Right. And then we own, uh, downtown core assets as well. Multi family assets as well. We bought those before an ACL, so we kind of do it all.
Billy Alvaro 00:06:12 What's your process for acquisition? It's old broker relations.
Kenny 00:06:17 Yeah. Really it is. I mean, in my twelve year career, I've only bought one directly from a seller. All of them have even in the off market stuff comes through brokers on multi family from, uh, what we found. So those mailers that people mail me and handwritten pencil, they don't work, they.
Billy Alvaro 00:06:34 Work with the 20 to 30 units. They don't work with the 75 plus?
Kenny 00:06:38 No, absolutely not.
Billy Alvaro 00:06:39 you're dealing with a different type of clientele. They're going to call a broker, get a professional opinion and put that thing in the market. Get as many eyeballs on it. Are you finding that the deals that the brokers are bringing you, are they on market deals?
Billy Alvaro 00:06:50 Are they off market deals where they're kind of like pockets and they're saying, hey, we got this property is coming up before I put it out to market, like, I'm going to run it past you. You have those relationships?
Kenny 00:06:59 We do. Yeah. We get a lot of first looks, and they always tell you you're the only one. There's probably five others that are also looking at it off market. we get a lot of first looks, in that top five or so, which is good.
Billy Alvaro 00:07:13 How many deals do you think yourself and your team has to look at before, you guys get an loyal.
Kenny 00:07:21 What does that ratio right now? So this year has been really strange. The deal flood has just died about June or July this year. So it's been super slow. So before this year, I would say, um, last year I'd say it was probably 80. I mean, it was a lot we had to look through a lot of deals to find the deals that make sense for us.
Billy Alvaro 00:07:40 Yeah. And, I know a lot of guys do. Do you have like a quick process that you just kind of review it to see if it passes muster in order to take it through your real serious due diligence. What does that look like?
Kenny 00:07:52 Yeah. So I was frustrated with some of the underwriting tools out there, so I just created my own. I kind of deconstructed five of them, put them together. I'm a former accountant, CFO type, so it was easy and I enjoyed it. So I created my own underwriting tool. We use that, um, and kind, uh, of trained up, my underwriting guide to be able to, be able to look at a deal within 15 minutes, plug in the numbers, and if we're within 90% of their whisper price, then we take to the next level. Then I see it weekly in our, uh, acquisition community committee, and then we go from there.
Billy Alvaro 00:08:25 Tell me about I want everybody to learn. How do you go about identifying markets? What brings you to the certain markets that you're investing in?
Kenny 00:08:35 Sure. So, for our existing multifamily Arm, um, we highly, look at, or only look at I should say only look at markets where they are landlord friendly.
Billy Alvaro 00:08:45 Not New York.
Kenny 00:08:47 No, we own some triple net CVS, Walgreens. We own a lot of New York State, but I would never own a multi family property there. Right.
Billy Alvaro 00:08:54 Yeah.
Kenny 00:08:55 So multi family landlord is number, one. And then cities within that state. Then you have to look at job growth, population growth, unemployment, diverse employers in that city as well.
Billy Alvaro 00:09:08 Mhm, interesting stuff. All right, so let's get over now to you're running through 80 deals. You make any look, do any otherwise, how many properties do you walk? And then actually turn into deals? Because I know that's a whole other process that you have to go through.
Kenny 00:09:23 It is. I mean, usually once we make an Loi, and if we're in the best and final, I feel like we usually get it. I mean, just because they know us now, in the market, we do what we say we're going to do. We don't ever retrain unless they're hiding something on purpose. But, we don't retrain, we don't play games, we close on time. And that really kind of usually puts you over, the edge as the winner.
Billy Alvaro 00:09:47 I'm loving it. And, not forget about retraining for a second. But when you go in and you're doing your analysis, how many analysts do you have in your team that are underwriting? Right now?
Kenny 00:09:57 We've got one. so he runs through all the multifamily stuff, smell tests, then brings me in once a week. We go over those ones that made the cut. And then once we make an offer and we're touring it, I take my multi family asset managers, usually one or two of them, depending on where it's at, to go to work with me.
Billy Alvaro 00:10:17 I love it. All right, so I want to get into now. Kenny, talk to me. You're syndicating everything, so let's go through a deal that you're raising capital for now. Like, what's your typical deal look like? What are the hurdles that you set in place, if any? What's the IRR? What's the percentage breakdown to the investor pool? What does that look like?
Kenny 00:10:36 Sure. Yeah. So we're buying a deal right now in Texas. Um, it's actually a portfolio, 443 units. I think it's $48 million acquisition. This one's a b, value add, both B minus deals, taking it to a B plus. There are ones in Houston, one's in Sherman, but the, uh, the one in Sherman, we've actually operated there before, is built in 86. There's never been upgraded unit interiors since 1986 on this deal, which is amazing. And in Sherman, for those that don't know, um, it was just announced there's now a third microchip plant being built there. So they're talking 12,006 figure jobs brand new to Sherman. So the Dclass for buying there is in the best of the best location, uh, which is a great place, uh, to be for all those jobs coming in. But we'll go in and do about half of the unit interior upgrades. just so, when our managers are touring a prospect, they have an option of, uh, a classic unit or an upgrade unit to capture both markets in there. And the one in Houston, that's an all town home deal with 81. again, they've done a great job. The, former owners, they've done 50 units, will do another 100 unit upgrades on there. So, basically, projected returns to investors are 114% total return over five years. So, IRR, you're looking at about probably 18. Um, and then cash, on cash, should be about 10% cash on remaining equity. So there should be about 30, 40% return of capital by year two on a refi. And then cash on remaining equity should be, uh, 12% through five years.
Billy Alvaro 00:12:07 And so your plan, like most, is five years in and out.
Kenny 00:12:11 yes or no? We just sold a deal last, Friday. We, owned a little less than two years. We doubled the money, sold it 115% total return, and then to our investors, and we're out. But we still own the first syndicated deal I ever did. We just kept refinancing it. So I'm not opposed to holding this for a long time, but I don't like to project more than five years, because if I'm off by year two or three, just a little bit, it just expands and expands. I can be really way off by year seven.
Billy Alvaro 00:12:40 Talk to me about the deals that you stay in with. So do you keep your investor pool in, or do you refinance them out and pay them out and get them out of the deal?
Kenny 00:12:47 No, they stay in, we, uh, treat them on like partners all the way. Through. So if they refinance on a refi, they get their money back. Even if it's 100%, they still own their ownership like it was on day one.
Billy Alvaro 00:13:00 That's the one and only that you have in the twelve years that you've.
Kenny 00:13:02 Kept in your pool as, the longest one. We still own M thing., we've owned some from another one we sold this year was we held it seven years. We've held some longer, if it makes sense, sure.
Billy Alvaro 00:13:20 What about part of this whole game? You got to find the properties, you got to manage your properties, you got to raise the money. Raising the money is a big thing for a lot of folks out there.
Kenny 00:13:29 That's the hard part itself.
Billy Alvaro 00:13:31 It's the hardest part. Why do you say that?
Kenny 00:13:34 Just, uh, because so many people have come to me and say, hey, I can help raise money for you and then none of them have come through. I mean, 0%, so I think that definitely is the hardest part. And it's really being like a trustworthy person and, uh, having experience. People like to invest with folks that have had experience, so it's a little hard to get started. And then also, too, I always come at it with, um, this is what we're doing, and so come join us if you want to. A lot of folks are after that hard to sell. And I always thought that that turned, uh, folks off, so I don't delay.
Billy Alvaro 00:14:05 So what is your process? Do you have a structured process for raising capital for, like I know in the business, the main business, we're in Fix and Flip. We have a main funnel to drive in off market deals. If we don't have that funnel, we don't get business coming in. We have relationships with realtors. That's another way we bring in the business. But simultaneously we have a funnel to bring in private lenders to give us money to do these deals. So do you have something like that set up on the multifamily side?
Kenny 00:14:30 Yeah, on the equity, we've got about 3000 investors that are on our list. So we blast it out. Um, uh, we're buying a downtown 18 storey, office building in Dallas to reconvert to residential. But we raised that $9 million in like 36 hours from our investor group.
Billy Alvaro 00:14:47 I want to go backwards now. 3000 people list. How did you get the relationships with those 3000 people?
Kenny 00:14:52 Man? Uh, grinding. So being on podcasts like this one, and then, we co host a big multi payment conference three times a year. Next one is in February 12 in Houston. 800 people should be there. And, uh, so we have that, um, we got a YouTube channel, I wrote a book. Just all these things to kind of keep getting our name out there and telling our story by the end of the day, it's still 70% of our new investors come from, um, our current investors as referrals, no matter what money I throw at this thing. On the marketing side, it seems like 70% of our new investors come from referrals.
Billy Alvaro 00:15:28 So I just want to dig into your funnel. So you have your books that are out there, you have your YouTube channels. Where are you driving them to? What's that funnel looks like?
Kenny 00:15:36 It all leads to our website. And it's really a thing where they, um, go and set, um, up, uh, a call with us, myself, or Savannah, our investor relations manager. and then that gets them into access to the investor portal.
Billy Alvaro 00:15:49 Got it. So that's the whole thing. Do you have any giveaways that you do? Any white papers that you give away? Anything like that?
Kenny 00:15:55 We did that two free chapters of the book, and, um, we got some out of that. But at the end of the day, still, those referrals are key. So really, I've just been thanking more of our investors for the referrals, hoping they get more referrals. Uh, but, um, we cut an ad. It's running right now on Fox Four, and then online and stuff. So we're trying new things to really expand it but it seems like referrals are still making up a lot of it.
Billy Alvaro 00:16:23 I'm loving it, man. So what's next to you, man? You're growing. You're in 16 states. It looks like you're in Texas, Ohio, Oklahoma, Georgia. Where else are you?
Kenny 00:16:32 So, that's for our multifamily and then the double, net stuff. We're in those 15 states and that's New York, Wisconsin, Oklahoma, Florida, just kind of all over on the triple net stuff.
Billy Alvaro 00:16:47 How are you going about searching for the triple net? What's your process for that? Little bit different from your apartment.
Kenny 00:16:52 It's a little bit different. I mean, most of those are really on the market. Um, we bought maybe a cane full off market, but it's more like buying a bond. So it's really on the market. Who can close the fastest kind of deal? So what we set ourselves apart there is we got a guidance line from a regional bank of 30 million. So that allowed us to close in like, 30 days on some of those. And that really kind of took out some of the competition on this.
Billy Alvaro 00:17:18 Set you apart. Um, Kenny, if people want to get more information, I know you have a conference. You said that's happening in February. Why don't you give a plug for that?
Kenny 00:17:27 Sure. Yeah, that's our MFIN conference in Houston, Texas. Uh, we do it two other times besides Houston, but February 11 and 12th. we've got that conference going on now. Um, and it's all education and networking. There's no big thing to buy at the end. Um, so we fly in national speakers like Tommy Wright spoke at the last event, bob Helms, those kind of folks come speak in the morning, and then the afternoon is just breakout educational sessions. So, uh, CPAs management, um, and you kind of pick and choose what you want. so there, we got that. And then with us at Wolf Investments, the best way is through our website, Wolfe-investments.com. We're, very active on Facebook, and YouTube. And they're now the young folks in the office getting me on Instagram. So I'm getting better at that.
Billy Alvaro 00:18:13 Young folks, I love it. This was great, bro. I love interviewing smart, bright guys. You're one of them. I really appreciate you taking time out of your day today to come on to Unstoppable area wealth.
Kenny 00:18:23 Absolutely. Thank you, Billy. I appreciate it. Yeah, good to meet you, man.
Billy Alvaro 00:18:26 Yeah, you as well.
Kenny 00:18:26 Take care. Thanks.
Billy Alvaro 00:18:29 Thank you so much for listening to today's episode of Unstoppable real estate investing wealth. My mission is to give you, my listeners, the blueprint to Success the Insider Secrets for starting, growing, and scaling your real estate investing business so you can experience and live the unstoppable lifestyle. I've made it simple for you to catapult yourself. It says go to Billyssecrets.com @billyssecrets.com. There you will find every single tool, tip, trick, strategy, system, and secret used to make millions of dollars as a real estate investor. Everything my team uses and my guests use all in one place for you to tap into so you can start, grow, and scale your real estate business. I really hope you implement what you're learning. I hope you utilize these mhm tools, tips, tricks, strategies, and secrets. And I hope to see you on the next episode.
Kenny 00:19:27 God bless. Bye.
Billy Alvaro 00:19:28 Bye.
Billy Alvaro 00:19:55 Thank you so much for listening to today's episode of Unstoppable real estate investing wealth. My mission is to give you, my listeners, the blueprint to Success The Insider Secrets for starting, growing, and scaling your real estate investing business so you can experience and live the unstoppable lifestyle. I've made it simple for you to catapult yourself to success. Go to Billysecrets.com@vilyssecrets.com. There you will find every single tool, tip, trick, strategy, system, and secret used to make millions of dollars as a real estate buzzer. Everything my team uses and my guests use, all in one place for you to tap into so you can start, grow, and scale real estate assessment. This, I really hope you implement what you're learning. I hope you utilize these tools, tips, tricks, strategies, and secrets. And I hope to see you on the next one.
Speaker 3 00:20:53 God bless. Bye.