MB 068: Why Bigger is Better with Multi-Family Investing

MB 068: Why Bigger is Better with Multi-Family Investing – With Kira Golden

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Financial Freedom with Real Estate Investing

MB 068: Why Bigger is Better with Multi-Family Investing – With Kira Golden

Show Notes

‘When others are fearful, be greedy. When others are greedy, be fearful.’ Today’s guest took Warren Buffet’s advice to heart, moving past her fear and reaching out to investors at the top of their game to ask for guidance as she shifted from single-family fix and flips to 300-plus unit multi-family properties. Her bigger-is-better philosophy has led to a love of investing in sizable unloved properties and performing a full-gut rehab to revitalize the property – and the community.

Kira Golden is the CEO of Direct Source Wealth, a real estate development company out of Denver that does direct deals and serves as a platform for new and experienced investors. By the time she was 18, Kira had holdings in both the real estate and stock market. After graduating Magna Cum Laude from George Washington University with a master’s in public administration, Kira worked as a financial advisor at Edward Jones until she was in a position to live off her investment income. She currently owns properties in Washington, Colorado, Arizona, Illinois, Ohio, Puerto Rico and France.

Kira is on a mission to bring high-quality deals to Main Street, providing clients with the financial freedom she has earned through investment in real estate. Today she shares how she financed her first deals, what prompted her shift from single- to multi-family properties, and why she reaches out to big name investors at the top of their game. Listen in to understand how to choose the right equity partners and why Kira recommends investing in apartments – the sooner the better!

Key Takeaways

[2:25] How Kira got her start in real estate investing

Watched Robert Kiyosaki infomercials as ‘12-year-old insomniac’
Experienced windfall/freak-out cycle as daughter of inventor
Desire for consistent cashflow led to buying houses at 18
Bought five houses in three years

[5:13] How Kira financed her first deals

Invested $3K savings in stock market, grew to $10K
Used $10K to finance first house
Put $1K deposit on condo, then sold option to homebuyer (value had increased during construction)
Used profits to finance second house

[9:14] Kira’s minimalist philosophy

Continued to save money, work full-time during college
Conscious decision to ‘live like college kid’ until age 30
Passive cashflow exceeded expenses by 22 ($2K/month)

[10:56] Kira’s shift from single- to multi-family investments

Goals grew from $1M to $100M
Weary of fix and flips, borrowing hard money at 18%
Got into private lending
Time became more valuable than money
Feedback from lenders indicated that $1M loan for multi-family was easier to secure than $100K loan for single-family home

[15:07] Kira’s intent behind reaching out to potential partners

[16:56] Kira’s first 30-unit multi-family deal

Continues to take 20% of time three years later
Bank deal, bought distressed asset
Bought $5.4M bank note for $1M
Invested $2.5M to complete construction
Used investor capital, joint venture with equity partner

[19:19] How Kira attracts investors

Shares her excitement for deals
Distinguish between fear and intuition
Go where you’re afraid, reach out to big names
Founder, CEO of fifth largest mortgage bank in US
Large real estate investors at top of game

[23:12] What Kira learned from reaching out to sought-after investors

People you’re hero-worshipping are just people
Deep respect for what they have accomplished
Emulate skills that made them successful

[27:34] The importance of alignment in selecting an equity partner

Had to buy out partner on 30-unit after legal battle
Long-term buy and hold vs. high-velocity fix and flip will end in conflict

[30:47] How Kira would approach raising money for 30-unit deal without equity partner

Not beyond door-knocking (pushing own boundaries to raise more capital)
Approach bank to carry back the debt
Raise construction capital after closing ($250K/month)

[31:56] Kira’s 315-unit full gut rehab

Mentor offered pocket deal, he functioned as silent partner
Vacant, drug-/crime-infested area of Dayton, OH
Turned around, named top-ten complex in city
No equity partner, built engine to find investors (first generation made good)

[34:16] Why Kira wishes she had done multi-family sooner

Fix and flip experience was valuable (can’t be snowed by property management companies, contractors)
Two years would have been long enough
Multi-family is a better vehicle
Had to build confidence while maintaining roots

[37:21] Kira’s advice for aspiring real estate investors

Determine whether you are a deal junkie or just want to retire early
10% who are deal junkies should align with experienced partner to short-cycle learning process

[39:15] What’s next for Kira and Direct Source Wealth