Host Steve Seymour interviews Trevor Calton, a real estate veteran with over 18 years of experience in training real estate brokers in the multifamily and commercial real estate investing world.

You can listen to the full podcast episode or watch in on YouTube here.

TL;DR - Summary

In the world of commercial real estate, knowledge is power. Each transaction can contain a web of complexities, with financial decisions at every turn that can greatly impact the profitability and success of an investment. To shed some light on these intricacies, Steve sat down with Trevor, who is an expert in commercial real estate financing and the creator of Real Estate Finance Academy, an online resource for investors, agents, and lenders.

The Multifamily Magic: Why Scale Up Sooner

During the conversation, Trevor touched on the importance of transitioning to multifamily and commercial real estate investments as quickly as possible. While single-family residences can provide a steady income, scaling to larger properties provides more predictable cash flows, economies of scale, greater returns, and often less risk. The transition, however, can be complicated by the increase in the number of properties you own. Trevor emphasized that the sooner you start that transition, the easier it will be as every single-family property you acquire makes the shift more difficult.

Delegation and Surrounding Yourself with the Right People

According to Trevor, delegation and surrounding oneself with experienced partners and teams is crucial. Looking back, he would have chosen fewer partners with more experience. This way, he could lean on their shared insights when navigating tricky situations. Also, hiring professionals to handle specific tasks can free up valuable time for investors.

Negotiating on Commercial Loans

In traditional commercial real estate, everything is negotiable. From prepayment penalties and interest rates to loan duration, the borrower can tailor their loan to align with their strategy. Commercial loan brokers, like Trevor and his team at Evergreen Capital Advisors, with their consistent engagement with lenders, know the market programs and trends. At little or no extra cost for the investor but provide an invaluable service in making sure the investor gets the most favorable terms in line with their goals.

Be Ready for Downturns

Even the best strategies can falter during economic downturns. Trevor advises investors to align themselves with advisors and peers who can offer insight and encouragement during challenging times. It's not about avoiding hard times, it's about being prepared for them and having a support system in place to help you weather the storm.

Conclusion

Being armed with the right team, tactics, and tools can make a significant impact on the success of your commercial real estate journey. As Trevor suggests, the rate of scaling up, the ability to delegate, prepare and react to downturns, and always remembering to negotiate your terms are all crucial to thriving in the dynamic world of commercial real estate investing. From multifamily units to commercial spaces, every investment offers its unique blend of challenges and opportunities. By equipping yourself with the right knowledge and team, you can navigate these complexities with confidence.

Full Transcript: 

Demystifying Real Estate Finance: A Conversation with Trevor Calton, an Industry Titan

Introduction

Steve Seymour: Welcome to the investor agent podcast. I'm Steve Seymour, your host, where we help transform the human mindset from scarcity and lack to abundance of wealth one conversation at a time. Hey guys, Steve Seymour here with the Investor's Agent podcast. I have Trevor Calton on. Trevor, thanks for being on the show today.

Trevor Calton: Hey Steve, thanks for having me. I appreciate it. It's nice to be here.

Steve Seymour: So we're going to dive right in.

Guest's Journey into Real Estate

Steve Seymour: I want to get some, a little bit of background on you, Trevor. I know you've been training real estate brokers in the world of multifamily and commercial real estate investing for, I believe you said 18 plus years.

So why don't you give us a little background on how you got into all of this.

Trevor Calton: I feel like I was destined for being in commercial real estate when I was young. I thought I wanted to be an architect because I grew up in Los Angeles and I was always going around checking out the big buildings.

And I think probably somewhere around middle school, I figured out I couldn't draw, but I was pretty good at math. And when I was in college, I was a business major, and studying real estate, and I majored in finance because I knew that if I wanted to be in commercial real estate, I really needed to learn how to run numbers.

And so when I got out of undergrad, I decided to go and go working for a mortgage bank. And I live in Portland, Oregon, and there was a rapidly growing mortgage bank here in town that was doing quite a bit of acquisitions of distressed assets around the country. So they were buying pools of loans from banks and foreclosed commercial properties.

And I got a job on the acquisitions team as a due diligence analyst. So my first couple of years out of college were flying around the country, going from bank to bank and underwriting distressed commercial properties.

Steve Seymour: What an amazing experience to get so early on in your career?

Trevor Calton: It was awesome. I learned a lot. I got to see every kind of product. Yep. 

Steve Seymour: And as an analyst. That's like zero to a hundred to some people, I would think. 

Trevor Calton: Well, I went after it. It was something I knew that I wanted to do. I really wanted to learn. I just happened to be lucky enough to find myself in a place where if you were willing to work hard, they would give you as much responsibility as you could handle.

And it was a lot of fun. It's amazing. Yeah.

Transition from Analyst to Broker

Trevor Calton: And after a few years as an analyst, I had learned about finance, I had learned about real estate, and I wanted to get out on the deal making side and make more money, frankly. Because I was on salary and I used to see a lot of these brokers and other guys doing really well.

And I interviewed as a commercial mortgage broker in 2004. And I was talking to the owner of the company and he said to me, “Well, I just filled my last realist or my last mortgage desk yesterday, but I also own a real estate company, and I could really use a real estate broker that speaks finance.” 

And at first I was like, no, I'm not interested.

And I remember he said to me, “Well, I can understand that. It's a lot harder, even though you can make a lot more money.” And he kind of roped me in. 

And he was right, because in my first year as a broker, out of 31 agents, I ended up being a top producer and I crushed it. I did almost $15 million in transactions, in my rookie year. And so, I realized then that he wasn't kidding.

Importance of Finance in Real Estate

Trevor Calton: The finance really matters and being able to sit down with a client. And walk them through the numbers and explain to them the impact of different leverage options or a variety of things. Negotiating in commercial real estate and investment properties, it's all finance.

And we don't get into the business because we want to be landlords. We get into the business as investors. And so understanding the numbers really helped. And a year later, I was. But I was training all the brokers in the office. So 2005, that's when I started training real estate agents.

Everything from the beginning to the basics, like how to calculate a loan payment to helping clients who maybe want to roll up a bunch of smaller properties and go into one big commercial property, all of that, it's all financial analysis. So that's how I got here. And then years later, I was teaching at the university.

I was teaching real estate finance and my students were like, Hey, Trevor, you need to put some of these on video. And over the course of a few years, I figured out a way to make the finance actually watchable and that's how real estate finance Academy was born.

Steve Seymour: So make it in a way that doesn't put people to sleep. 

Trevor Calton: Right. Yeah, that's the goal. Lessons that they can chew on.

Steve Seymour: So, yeah, I mean, finance is a huge piece of the puzzle and real estate investing it and without it, you can really make some very poor decisions.

Common Mistakes in Real Estate Investing

Steve Seymour: So with that and with all your experience, what do you find that are some of the biggest three mistakes? I would say maybe the three biggest mistakes you see people overlooking when they're evaluating properties in terms of the financial aspect. What are some of the biggest mistakes? The things that you see that is pretty common among real estate investors. 

Trevor Calton: Steve, that's a great question.

The first mistake that I see probably most often is the assumption that LTV is the amount of financing that you're going to be able to get. People call me all the time or brokers are saying this guy wants 80% LTV and I think what that demonstrates is that the main difference between residential and commercial is that LTV is just one constraint, but that's not actually how the financing and the loan size gets determined.

It's the income and the debt service coverage, which changes with the loan terms. So the amount of financing. That is available on the commercial property is directly related to the income on the property. And just because somebody says, Oh, we'll go up to 80% LTV doesn't mean that you're going to get 80 LTV.

And I think that's the biggest thing. So it's a little bit of a shock when people who are maybe just breaking into commercial, come to us and say, Hey, I want to buy. Now I want to buy this 2 million property and I only want to put 400, 000 down. You know, what can you do? And what's the rate? Now lead me into the second thing, which is, this happens all the time.

People will say, well, what's your interest rate on a multifamily. And I always say, if somebody answers that question with a number and they don't caveat it, then they're probably making it up because it should be the rate

fixed for? You want 25 or

30 year amortization? Do you want to get an interest only period in the beginning? There's so many different moving parts in a commercial loan and all of those affect the rate.

Steve Seymour: So, let's go back to what you just mentioned about the debt service coverage ratio and the LTV.

Understanding Loan Sizing and Debt Service Coverage

Steve Seymour: So, let's break down an example that is in 1st grade level.

So many listeners kind of get this because it is a huge piece of the pie with commercial financing and you mentioned that. It's going to be limited to the income of the property and what that income can cover in terms of the debt that you're going to place on it, regardless of the LTV.

So the LTV is kind of the minimum standard, right? And then meaning you're not going to go above the 80% LTV with a commercial lender, typically. Right. 75% depending on what the risk tolerance is.

Trevor Calton: Yeah, the LTV represents the ceiling. Like the maximum yeah, I have a couple of videos

Steve Seymour: go ahead. No, I was just going to say, can you give a basic example if you just use some round numbers in terms of maxing out the LTV and then what do you see is like the typical debt service coverage ratio?

I know it depends on the loan and the bank and all of that, but if you could give some ranges,

Trevor Calton: Sure. The easiest way to think about how loan sizing works in relation to debt service coverage would be, let's say you have a property that's got a net operating income of 125, 000, right? And you'll see why I'm using this number as an example.

Your typical debt service coverage ratio for most lenders is around 1. 25. And what that means is the net Operating income needs to be 1. 25 times the loan payments for the year. And the one thing that people often don't realize is in order to actually calculate that on your own, you'd need to understand how to calculate a loan payment with a financial calculator.

So sometimes people want to use that number and they can't because they're, it's sort of a level two skill. But Going back to my example, if we have 125, 000 of net operating income, 1. 25 is the debt service coverage. That means 100, 000 is the total amount that the lender is going to allow for loan payments.

And so what they do is they'll cut that, they'll take that 100, 000 divided by 12, plug that in as your maximum monthly loan payment. And then they say, okay, what are today's market rates? What's the amortization? And they'll use that maximum payment to back into the loan amount. So it's actually working backwards from the income.

rather than from the ceiling. And so if we take that, okay, I've got 125, 000 of income. The bank says I can only use 100, 000 for loan payments because they want you to have that extra 25% cushion. Then you figure out the loan amount, and as long as that's within the LTV still under that 75 or 80 percent LTV, then that's going to be the loan amount.

So, the thing about commercial loans is there's multiple constraints, but it's all driven by the income. And that is really just, it's a risk mitigator for the lender, but it also ensures that the borrower or the owner doesn't get in over their head and overextended. And then all of a sudden they're running out of cash right out of the gate.

Steve Seymour: It shows the lender that the rent will exceed the income or exceed the deck coverage. And there's going to be some room there for a little bit of error. In terms of calculating the NOI, right, because that's a big piece of it. What are some of the things that you find people maybe underestimate or don't calculate correctly.

And then they, cause the biggest thing is everyone wants to save time, right? You don't want to, you don't want to spend a lot of time, put money on a deposit and go through due diligence. And you're taking the pro forma from maybe a real estate broker. And they're being a little aggressive with some things to paint a picture that it's a better deal than it really is.

So in terms of actually trying to calculate the true N. O. I. Where are some of the holes that you see that a lot of people overlook or need to be a little more conservative on?

Trevor Calton: That's another good question, Steve. The thing that a lot of people don't look at is how the property would be managed if it were owned by a third party.

And the way, that's the way a lender is going to look at it is what is the net operating income going to look like and what are my expenses going to look like if I have to have somebody else professionally manage if I'm Doing all of the regular maintenance, if I'm putting reserves away for turnover and for capital items, and I think reserves are probably the one that get overlooked the most, but the reserves for CapEx.

Yes. Yeah. So, we'll stick with the multifamily example. You're going to have property taxes, you're going to have insurance, you're going to have your repairs and maintenance, your landscaping. But there's always going to be some level of turnover during the year. You know, I think the average multifamily property turns over somewhere between 40 and 60% of its units every year.

So if you say you're going to have $250 of turnover costs for each turnover, you really want to include that in your operating expenses because everybody else is going to, as far as the lender and the underwriter. And then if you know, you're going to have ongoing capital needs throughout the life of the project, you should be putting away something every month and every year for those capital needs and the CapEx is a little bit subjective, not everyone includes capital reserves as part of their operating expenses, but it is better to be safe than sorry. 

Steve Seymour: Nothing lasts forever in terms of these buildings, right? You know, there's a reason why everything has a depreciable life and the IRS allows you to depreciate it because they know there is a life span for a roof. There is a life span for you know, these major items in a property. And if you're not accounting for it, then it's going to eventually need to be replaced. So, yeah, I've noticed that even on, like, the smaller single families, it's like when you look at gross cash flow, it's, you're not putting away for those things, a heater, a roof, any of those things can wipe out your cash flow for years, if you're not accounting for it.

Trevor Calton: Yeah, I always recommend people take it you don't want to get into a property and put every penny that you have down going into it. So, I always recommend people take at least, well, I guess it depends on the deal, but take some percentage of cash and put that into a reserve fund, get that reserve fund started, it's, I've been in that my very first rental property.

Immediately we were in the negative because we had unanticipated capital needs and we had management issues. So it was a total nightmare, but it was a good learning experience and you're absolutely right. You want to be planning for that because it's not a matter of if it's going to happen, it's a matter of when.

Steve Seymour: Yeah. So, so the big things I heard out of that is if someone has a property listed for sale or you're evaluating a pro forma and you see maybe the management fees are low because it's self managed you have to look at it as what would it be like if you had a third party manager, because that's how the banks are going to underwrite it.

And if there's no CapEx in there, there should be something. It probably depends on the age of the building and multiple different factors as to what that is in terms of a percentage. But if you don't have those things in, you're being unrealistic.

Steve Seymour: I'm guilty. I'm actually going through this right now where I'm actually looking at getting a second line of credit. I have a commercial lender that's willing to do a line of credit on some of my rentals and second position that they're there for first position lien holder, and they'll go up to the 75% LTV.

And there are 1.2 coverage ratio, and that's where we're running into it. Just on 4 properties. There's a million dollars in equity. And they'll so the equities there, the LTV is not an issue. It's the debt coverage ratio that's limiting trying to get like a $500,000 credit line.

Challenges in Scaling Real Estate Portfolio

Trevor Calton: It's similar. It's a very common problem when you're trying to scale a portfolio of single family properties that a lot of my clients have at some point or another in their investing career been at that spot where like, I can't get any more conventional loans and I'm limited to 10 residential loans in my name and getting a name like an LLC is a little bit harder, but still, if you're the guarantor, just, it becomes harder and harder to scale.

And what happens is you see more and more of that trapped equity. 

Steve Seymour: Okay. So that's a common problem that you're running into. Yeah that's the thing, right. It's just, if you can keep deploying capital and even if you're finding great deals and creating some equity value add situation, if you're not able to access that capital that you leave in the deal, you're very limited as to what you can do, unless you bring in some private money and start getting creative with potentially putting together private money and institutional money as a blended Capital stack. So how do you see where a lot of people kind of get to have this fixed mindset that there's one way to do things. And everyone has different risk tolerances in terms of leverage. And what you shouldn't do. But do you have any tips for anyone that's kind of in that boat where they're not a newbie investor, they have a portfolio, they're looking to scale up, but it's gaining that momentum without.

Essentially running out of capital, how to put deals together where you can almost have that rinse and repeat strategy. I know that's kind of a broad question. I don't know if you have an answer for it, but you know, I think that's one thing that a lot of people get into a couple of deals, and they have to stop.

Trevor Calton: Yeah, it's a great question because it's a really common problem to have, so I bet a lot of your audience can resonate with that question. 

I'll tell you a story. I had a client back up in 2007 leading up to the crisis of 2008. He had 18 different properties ranging from single family to, he had a few duplexes and triplexes, and he was just spread thin, but he couldn't get any more loans.

He wanted to consolidate, but he was going to be facing a lot of capital gains taxes if he tried to sell a bunch of things off one, one at a time and couldn't 1031. And he did a two-pronged strategy, which I think is what a lot of people will run into. The first thing he did is we sold, we ended up selling all 18 of his properties and we were able to roll them all into the same 1031 exchange, but that took a lot more work than most people want to put in.

But selling them off even in chunks and kind of dictating the terms of sales. So you can roll those into a 1031, collect all of that equity, and then put that into a commercial building. That's one way to do it. And I highly recommend people do that because you mentioned risk. You know, generally speaking, 20 units of multifamily is going to be easier and less risky and more profitable than 20 single family properties.

And you get the economies of scale, but going back to answer your question, the other way to do that, if you are wanting to roll up and consolidate and get into commercial, especially if you found that scaling has gotten really challenging, is if you're at the point where you have the ability to scale, that typically means you have a track record.

Exploring Real Estate Syndication

Trevor Calton: And so then you're a great candidate to become a syndicator. And when I say syndicator, there's, they, syndicators can come in all shapes and sizes, but really just think of friends and family, right? If you are a real estate investor and you've built up a portfolio of smaller properties, that might be a great time for you to go out to your network and say, I'm taking this to the next level.

I have an opportunity to bring on some partners. Would you like to get in on this together? And then now suddenly you're not relying on going from point A to point B on your equity in your previous properties. Perhaps you can go bring on some investors and then sell your other properties and reinvest them.

Maybe you can consolidate in a different way. So the true answer is it depends on each individual investor strategy, what their portfolio looks like. But there are options out there.

Steve Seymour: Yeah. And syndication being simply put as putting together multiple investors into one deal. Right. And then that can be structured in so many different ways. I mean, syndication has become pretty big publicly out there. I mean, it's been around for a long time, but definitely with bigger pockets and syndication has expanded a lot over the past few years, especially with Multifamily being such a hot topic.

With someone getting started in syndication. I mean, I know you, you probably have that as part of your training and coaching that you do. What are some of the biggest things that you find that people don't set up their syndications correctly, where they're not really looking at how it's going to impact the investor's capital.

And then making sure I mean, obviously, if the deal works, kind of everyone's happy, right? But when people are speculating on rent growth and. Over the past couple of years, like how it has been in certain markets. I know there's definitely some syndicators out there that probably have gotten themselves in trouble where they've taken on bridge loans where the interest rate was at a I don't know, a 4% or 5%. And now they are looking at their permanent 6% or 7%, right? So other than those 2 major things with growth not really keeping up. I know there's rent growth in certain markets, but a lot of people were showing rent growth of 20% year over year, which is crazy, right? It's unrealistic to imagine that's going to always continue. 

Trevor Calton: Great question, and there are a few answers there. And the first one I would say is less is more. If you have a track record, there are investors out there that want to invest with you. They’re looking for you.

And a lot of investors that are, excuse me, a lot of investors that are syndicating for the first time, and again, when I say syndicating, I just mean friends and family to start because that's really what it is. You don't want to be syndicating to a bunch of strangers if you've never done that before. You've got securities laws you could be violating to deal with.

Steve Seymour: Yeah. You could be violating.

Trevor Calton: And yeah and I learned this when I did my first syndication. We had 12 partners and a few of them wanted to be in the deal. But then I had one guy that was in the deal for like 12 grand and we were buying a 22-unit property and I didn't need that. But I brought him in as a favor and, in retrospect, it was just that much more to deal with in terms of the number of reports you have to send out and the number of questions you have to answer.

And actually the smaller investors tend to ask more questions, but my point is. Find the few investors that already understand why your track record is meaningful and recognize the fact that they're looking for you. They are looking for a place to deploy some of their capital. So don't have the mindset that like, Oh, I'm out begging for money.

You are creating an opportunity for those investors to put their money into something without having to put their time, energy and resources into it. And so it's sort of a mindset like. “Hey, I'm scaling my portfolio. I'm about to create some more opportunities.” I'm looking for a select few people and to give them an opportunity and I'm going to bring them on board.

So rather than just trying to go out and get a few bucks here, a few bucks there from anybody that you can, you want to really position yourself as confident and realize that you are creating an opportunity for them. And don't try and syndicate with people that you don't know, because you're going to end up pitching.

10 times more people than you need to be. And you're going to run into all of these securities laws that you don't want to mess with because they're only getting more and more strict, despite what we see with the jobs act from 2008 and you know, the crowdfunding and all that stuff. It's very dangerous.

To get involved in syndicating with people that you don't know, but you can get ahead of that by starting early. And even if you know, next year, I'm going to want to bring on some investors for a deal, start telling them about it now. 

And that's another thing that I think people probably should hear. Even if you don't have the deal yet, you should be pitching the strategy because investors are going to want to know that you know exactly what type of property going after, are you going after value add, are you going after some some repositioning, whatever it is, whatever your specialty is, understand that strategy, right?

Be laser focused on it because that's when you're going to get investors like you're the person I want to invest with because you know exactly what you're going after. You're not just anything that comes your way. Does that make sense?

Steve Seymour:  Yeah, absolutely. With syndications there's a lot of people, a lot of what I heard was kind of start small, start with people with whom you have a substantive business relationship so you're not soliciting. and in my mind, because I've looked into this as well and done some smaller syndications myself actually negotiating one right now for a commercial development, small and smaller commercial development deal it just would be like four partners, but all have Previous business relationships. There were no offerings. They actually brought us the deal. It was kind of interesting how it's working out, but we'll see where it goes. And so what you're saying rings true with my experience.

As long as you're creating enough equity on the value add, and that's a rinse and repeat. It's a great strategy, but when you get into these larger commercial deals, sometimes the project timeline might take two or three years before you're really able to access that capital back to refi or sell or whatever the exit strategy is.

So I think syndication is a great strategy to be able to bring in outside money, to continue to scale your portfolio. 

Trevor Calton: Yes. And structure the partnership or the LLC such that everybody's interests are aligned. And that goes back to your first questions to things that you'd recommend would be structuring the deal so that a good portion of the syndicator, the sponsor's compensation comes from performance.

Probably the biggest complaint that a lot of investors have and the biggest cause of redemptions is the syndicator makes a ton of money on acquisition fees and maybe a bunch of money up front and it's not. Very much tied to performance. You know, the hurdles aren't well defined and the promote isn't well defined.

And then people say, well, I want out of this deal. If you, if your interests are aligned with your investors, you're less likely to have people want to redeem even in bad times, and then make it, make sure everybody understands. You're in this deal for five years or three years, whatever we decide our minimum holding period is.

And then after say, like the way we would structure ours was I think it was after a seven year potential hold after four years. Anyone could call for a vote and to sell the property. If somebody wanted out and they couldn't sell their interest to another member, anybody could call for a vote and then the majority rules.

But after seven years, anyone could call a force, force the sale. So you know, you knew that you had an accident at some point, but the syndicator, the sponsor knew that they at least had everybody's money in for a certain amount of time. And they didn't have to worry about there being early redemptions.

And the investors didn't have to worry that, Oh, this syndicator is milking all the money out of the property because a lot of his compensation is tied to performance. So I would just say, make sure that you're, you treat the investment the same way that you would. As an investor, like you, you want it to be well managed.

Steve Seymour: Kind of going back to the golden rule, treat the investor how you'd want to be treated. Even if you were taking a passive role in it, you put money in something, you want to have some level of, I know I'm going to get my money back at some point. I'm going to have some trigger that says it's time to pull the cash back out where you're not and have the performance tied to if they're taking the active role that the active role is creating value, not just like you said, just the fee, the finder's fee up front, the acquisition fees.

So I guess let's shift to the other side of that.

Tips for Evaluating Syndications as an Investor

Steve Seymour: If you're on the If you're on the investor side and you want to passively deploy capital into some real estate investments and take advantage of the the depreciation equity upside, the cash flow appreciation, all the benefits of investing in real estate without the headache and you're vetting syndicators, you're vetting operators who are putting together these strategies.

What do you think are some of the top things they should be looking at? I mean, I know it's kind of a great question, right? It ties into exactly what you're saying, but just shifting it from not just how to structure, but how do you evaluate it if you're on the other side of it?

Trevor Calton: Yeah, that's an excellent question.

Steve Seymour: I'm going to just keep soaking in as much as I can from you, you know.

Trevor Calton: Yeah, let's do it. And I did exactly that when I started syndicating. I interviewed 20 different syndicators before I put together my first deal. And the one thing I would ask them is what is your reinvestment rate? Like you, you want to.

As an investor, you want to invest with somebody that has some level of experience and it doesn't necessarily have to be their very first. They don't have to have experience in that maybe a property type, like if they're going to go to a big multifamily when they were doing smaller multifamily. You know, that's okay, but you want to make sure that they have at least done deals before and have a track record.

And if they have multiple deals, how many of their investors reinvest with them again? That is a good indicator of performance and it's okay to ask for references. I think it's more than okay. It's probably necessary. I would want to know how their promote is structured. And so what are they taking for acquisition fees and asset management fees?

And what other fees are they taking? And how are those cash flows paid out in terms of priority? The other thing that I would say is If you're an investor and you're going to go invest with a syndicator, it should be a property type that you believe in and that you're comfortable with. So, if you don't have any experience in say medical industrial or something, you may not want to be investing in that because then they're going to start speaking a language you don't understand.

And there's going to be a lot of mechanics, maybe in things like the leasing process or the tenant improvement process that you just don't understand. So, I'd say. Invest in a project, a property type that you understand, and a sponsor that you believe in. And make sure that sponsor, his interests are aligned with yours.

So, I think there's a lot of trusting your gut. You can just kind of tell when people are really going to work hard for you as an investor and they really want to make it succeed. And nothing is a better indicator than when their compensation is tied to the performance of the asset. 

Steve Seymour: It's the difference of an employee mindset versus an owner, right?

It's like someone yeah They're going to only get paid if they perform if they make it happen Yeah, now I know there's like different there's so many different structures of syndication and some are you know? GP/LP structures where the general partner is I'm just kind of general terms. They're the operator, right?

They're the ones taking an active role in the business. And creating the value and typically bringing the deal and then there's the LP side. Let's just for conversation sake, just say the limited partners taking a passive role, investing their capital into the deal. And that's really the only value they're bringing.

It's just the capital. Right? You know, in every deal that makes money, there's. Different levels of value that are brought to that transaction. So have you ever really tried to see what the breakdown of that should be? And I know again, it's like you can look in generalities, but there's never you know, 100% rule for any one thing because.

You know, if someone brings the deal, there's value. If someone brings or puts together the institutional money, there's value. There's value to actually handling, let's say, project management, construction management. And then you also have, like, kind of the asset management piece, right? And then you have a back end of the business, which is.

All the other things, the administrative, the accounting, the you know, all the day to day, making sure the property is properly insured and everything. Right? So there's all these different components and it's like, have you ever broken down what you feel like each valuation or each segment is valued at.

So that when you put together a deal, depending if there's different partners you are kind of setting the stage for the most fair compensation based upon roles. And I think that's something when people are putting together syndications, a lot of times, it's not just one person that's taking an active role in the business.

A lot of times it's a team sport. Absolutely. And I think a lot of people get what is the allocation for each thing and who should get what. And I mean, I know that's pretty deep, but I think it's something that a lot of people need to think through because you're putting together a complex structure and the more people, the more complexity is and the more the more different components of the deal.

So you ever put like, oh, maybe the project management should be 15 or 20% allocated towards that 5 to 10% for the deal based upon how great the deal is.

Trevor Calton: I have a simple answer for that and do it the way a lender would do it and treat every function as if you had to outsource it. Okay. So if you had to pay an asset manager, third party asset manager, you'd probably be paying them one to one and a half percent of the gross.

If you had to pay somebody to bring the financing and you'd probably be paying them one to one and a half points on that financing piece or more if it's equity. But. What I would say, and the way we do it, and this keeps it really simple from a math perspective, and if you had to unwind an investment because it went south, the simplest answer is the easiest, which is treat everybody's money perpetually, right?

Every dollar that goes in is treated the same, regardless of whose dollar it was, and then When people are playing a management role, if they're not purely passive investors, then they should be compensated for that role as if you had to outsource it, because at any given point, that partner could say, you know what, we're going to go live on the beach on another continent.

Somebody else needs to take that over and either another person's going to have to absorb those responsibilities or you're going to have to outsource it anyway, so it shouldn't impact the investment and that way there's going to be less debate on the value that is brought to the table that way.

Steve Seymour: And then evidence, right?

There's some evidence that this is the market rate for originating a loan or there's the, this is the market rate for if someone was bringing a deal to the table and they're getting an acquisition fee. Absolutely. Project manager. And

Sharing Functions and Roles in Acquisitions

Trevor Calton: Then you can share those particular functions.

Let's say if two people are working on the acquisitions and there's four people in the investment, the other two are completely left out of that function. And then there's an acquisition fee. And those four people can agree that the two people working on the acquisition can share that fee. But as, especially when it comes to things like asset management, ongoing roles, just treat it as if you had to outsource it, and then you can put a number behind it and then it makes everything seamless.

Steve Seymour: Yeah, that's a great answer. And in line with what I was thinking, it's one thing to try to figure out who's really good at what and who should sit in what seat.

But if you kind of take the people out of the equation and just look at the function, and then what is the market rate for that? And yes, exactly. Create a percentage and that way it kind of depersonalizes it a little bit, right. In a negotiation between a partnership. So, really good stuff.

Shifting Focus to Current Market Trends

Steve Seymour: So do you mind if we shift a little bit towards today's market, where things are heading, pull out your crystal ball and yeah, I'm not going to ask you to make any predictions, but if you could make some possible guesses or assumptions I'd love them.

The Buzz Around Multifamily Space

Steve Seymour: You know, maybe specifically around let's talk mostly about the multifamily space, because I think it was such a hot thing over the past few years. And over the past, so it always has been, but there's definitely like a big buzz around multifamily. And one thing for me is getting into this space.

I'm like, how are people paying? Over the past few years, like, why are you buying this thing at a four cap? And they're like, I don't care about the cap rate.

Understanding the Risks and Rewards of Value-Add Investments

Steve Seymour: It's a value add, right? It's like, okay, well, I understand that to a degree, but if you're financing it, the deal's kind of got to work now versus speculating on what you're going to be able to do with rent growth and improvements.

And obviously there's evidence there, but have you, do you feel that there could be some people that maybe bought at prices that they were anticipating? They weren't anticipating the rates going up and they were maybe anticipating larger rent growth and they've seen. I mean, I'm not seeing any major distress out there.

I've talked to different people, but there's got to be some level of disruption in that space from where it was.

Trevor Calton: Absolutely, and I. A lot of the things that you just touched on can be mitigated with proper analysis and due diligence. But when we were looking at acquisitions five years ago, I basically put pencils down because.

We knew that cap rates for an all time low financing was at an all time low and really it was just like the perfect market conditions for a gold rush.

The Impact of Rising Rates on Investment Strategies

Trevor Calton: And now what we're seeing, we knew that rates would go up because we knew inflation was going to go up after the pandemic when they printed all that currency and that, that part, everybody knew it was going to happen.

I think the one thing a lot of us underestimated was the rate at which. The Fed increased the cost of funds. So it was like a rollercoaster. Yeah.

Insights from Industry Experts and Conferences

Trevor Calton: And so it's it's a little bit more jarring than any of us expected, but I've been going to some conferences. I actually just heard a great speaker.

Recently he's Spencer Levy. He's the head global strategist for CBRE and he did a great presentation talking about the fundamentals. And I agree with a lot of the things he said. Effectively, what he said is. We're probably at the bottom of the market right now in terms of market conditions because rates have just shot up.

The Relationship Between Cap Rates and Interest Rates

Trevor Calton: Cap rates haven't followed interest rates, which they always do, but they always lag. And so we're just now seeing sellers get a little bit more realistic about the cap rate that they can exit at. And that touches on what you said in the beginning, which is if you bought at a four cap and you didn't anticipate exiting in the four to five cap, then you're probably panicking right now, especially if you've got an impending refinance coming up.

So again, it depends on the strategy, but I will say that all the indicators are that the rate of interest rate hikes is leveling off and cap rates are doing what they always do. They're following. So that disparity between cap rates and interest rates is starting. To level off and close and we'll be back into areas of positive leverage again, and I'm seeing that but for the past nine months, we haven't seen any positive leverage the cost of funds was greater than the cap rates and I have videos on all of the stuff that for those people that don't follow what I'm talking about.

What if when your cost of funds is greater than the income that's coming off the property, then you're paying more to the bank than you're getting off. Yeah. And that's

The Challenges of Multifamily Investments in the Current Market

Steve Seymour: where I was like, why is this multifamily thing so great evaluating deals over the past year? It's been interesting. Yeah, I mean, it is great.

It can

The Return of Retail Deals and Market Predictions

Trevor Calton: be I'm quoting deals right now for clients on recording retail deals more again, and you know, it's starting to come back down. And I told my clients last summer, I said, you guys might be the last loan that I ever do, or my team does that's below 5%, and I honestly believed that. And we knew rates were going to go up and boy, they did.

They, but the nice thing is right now we're quoting rates in the low fives. On multifamily similar properties and that's really encouraging. 

Steve Seymour: It's not extremely different that now coming back but like you said, there's a lag period, right? Or do you think that now that the rates are dropping, then it kind of changes the mindset of the seller as well to just say, I'll hold off.

I don't think

Trevor Calton: rates are going to come back down to where they were. I know they might, but I think we're going to be back. We're going to be probably where we were in a 4% world for commercial for a long time. I think we're going to be in a 5% world for a while. And maybe I'm wrong. Eventually I will be wrong. So it depends on the time. 

Steve Seymour: That's way better than when it was at seven, or six, six and a half. 

Trevor Calton: Yeah. And historically prior to 2009, it was always in the sevens. I mean, we were paying seven and 8% on every multifamily loan. So it's been really favorable. And so if you look at the grand scheme, things are still really good, but it's that disparity between cap rates and interest rates that really.

messes things up. And that's where those syndicators are going to be in trouble. If they don't have an extension option on their loan and they have to refinance or sell and they can't get out, those are the ones that are going to be in trouble. My clients don't have that issue because I wouldn't let them get in that situation in the first place.

You know, we're going to build in those things because my team can help you anticipate, okay, what's your holding period? Well, what's the worst case scenario? Well, what if you have a value add strategy and you know, it's going to be capital intensive, we're going to put you into interest only for a couple of years.

The Importance of Proper Analysis and Due Diligence

Trevor Calton: And then we're going to give you the flexibility to deal with things that they go sideways. So, our clients aren't running into that, but I know there are a lot of people out there that are, cause you hear it in the media and like you alluded to it. So, My experience back in special servicing in a long time ago would tell you that Just remember that in commercial real estate and commercial lending, a lot of things are negotiable because the one that the one thing I will tell you is that banks don't want the property back, they do not want to foreclose that they don't want you to fall.

And so if somebody is say a novice syndicator and they're running into those issues, there are negotiations out there that can be made. You probably just don't know what they are. And that's again, where I think my team comes in is we have a pretty broad array of experience and so we're able to help people figure out what their strategy needs to be because it's different for every investor.

Negotiating Commercial Financing

Steve Seymour: Can we talk about negotiating commercial financing? Sure. Because that's one thing that, going from a residential investor initially is, let's say, someone's buying kind of their maybe they're buying their primary, turning it into an investment 20% down conventional loan. Generally, it's more like shopping rate and fees. But there's usually not a lot of negotiation because they're packaging these loans up, selling them to Fannie or Freddie with the commercial debt. Is it kind of like the wild West in a sense?

The Flexibility and Negotiability of Commercial Loans

Trevor Calton: Relative to residential. Absolutely. Because almost every residential loan gets pooled and sold off and that's why there's not a lot of flexibility, but we do this all the time.

You can tailor a commercial loan to your strategy. And everything is negotiable, and there are far more levers and pulleys in a commercial loan than residential. And I'll give you an example, like I just alluded to, if you, let's say if you're an investor that is doing a value add, right now it's pretty easy to get your first couple years payments as interest only, which in today's market would cut your payment by a third.

It's going to make it a little bit more expensive. You might add 10 or 20 basis points to your overall rate. You can pay to play however you want in commercial loans. So you can typically get a 3, 5, up to 35 year loan with a fixed rate. You can get a 20 year loan with 10 years of it fixed. You know, we can do 20 years, 10 years fixed, two years interest only at the beginning, and all of those things are negotiable things like the prepayment penalty, that's negotiable.

And that's why it's really important. And this is part of what drives my business is one, educating the investor, because the more educated you are, the better you can tell the quality of the advice you're getting from your professionals. And as an investor, if the advisors you're using. are not asking you questions about your holistic strategy, the rest of your portfolio, who are the stakeholders.

There should be a long list of questions that your advisors are asking you so that you know you're getting advice that really fits your strategy. And I think that's where we are able to differentiate ourselves and you see it because most of our clients don't run into trouble. And I love it because I get a lot more thank yous.

From my clients, you said this was going to happen and it did. Thanks for helping me know that because a lot of times it's just, if somebody is giving you advice, but it's limited and then they leave a bunch of things out, you don't know it. So,

Steve Seymour: So let me recap some of these levers and tell me if I'm missing a few, cause I'm sure I am.

Understanding Prepayment Penalties in Commercial Loans

Steve Seymour: You have your amortization. Right? Because it could be some commercial lenders might be saying, oh, we do a 20 year amortization 1 lever to get within the debt coverage ratio. It could be 25 right? Spread it out. That could be a negotiation point, 25, 30 one could be, you said the prepayment penalty, maybe they have like a 5, 4, 3, 2, 1, and maybe you go back and offer a 3, 2, 1 or something like that.

Trevor Calton: Yes. And, or a lot of people get into, and they don't, a lot of people get into loans and don't even realize that there are different kinds of prepayment penalties, like yield maintenance versus step down. And yes, you can negotiate the prepayment penalty. If you think you might want to get out in three years and it's got a five year prepay, you could probably pay a few extra basis points in your rate.

But see, let me tell you this. And for most of us, as you grow, you shouldn't be shopping for your own commercial loans. You're not fixing your own toilets. And if you're scaling your portfolio, and you're still fixing your own toilets, you're not using your time wisely.

The Role of Commercial Mortgage Brokers

Trevor Calton: And this is a huge lesson for investors that used to be in residential and they're graduating up into commercial, you should not be shopping for your own commercial loans.

That's what the mortgage brokers are for. In the Commercial lending market, it's so fluid. It changes every week. The guidelines change. There's literally no advantage to trying to go out and shop for your own commercial loan because the commercial mortgage brokers, they talk to the lenders all the time, every day.

In and out. They know the programs. They know who's expanding, who wants to get more aggressive. And they, you're going to pay the same amount because typically the lenders will waive or reduce their origination fee. So the broker can charge a fee. So the economics don't change. It's sort of like you're going to pay for your lawyer.

If you go to court, why would you not get a lawyer? Right? You're not going to go represent yourself. If you're paying for it anyway, you should have a lawyer. The same thing goes with the commercial capital market. And that goes back to your question. So how do you know what to negotiate? That's where you need to have good advisors.

But the prepayment penalty is one of them. There's all kinds of things. I mean, I should probably do a video on the list of all the different things you can negotiate in a commercial loan. But I think It'd be a long list.

Steve Seymour: Yeah. And every lender, right? Some are going to bend on certain things and some won't just because they might not change their box too much.

But that's cool. You know, a lot of people, you just don't think you can potentially negotiate your loan terms. And in the commercial world, you can

Trevor Calton: almost everything's negotiable in a commercial loan. And again, it depends on where that loan is coming from, because as you get into larger loans, like a CMBS loan where it's going to, it's already destined to go into a mortgage backed security.

You're going to have less flexibility than you would say, like a portfolio lender with a regional bank, they're not selling that loan. They're keeping it on the books. And once it becomes a loan, it's just effectively a bond for them. And so as long as they know what the risk exposure is and what they're going to get, they're usually going to be pretty flexible about certain things that don't really impact them. Where, If the loan is going to be sold, changes to the terms impact their ability to exit. So that's another thing that we advise people on is, again, what's your strategy? How long are you going to hold this for? And I always start out when I'm talking to an investor or who I think is going to become a lending client.

Like, what are your goals? Let's talk about your strategy first, because I especially can't quote you a rate until I understand, well, what kind of loan do you want? If you, if you want to do a value add and you want to get out of this thing in three to five years, then that tells me one group of loans that are going to be not a factor and another type of loan that's going to be probably a better bet for you.

So you kind of got to narrow down all of your options. Based on the goals of the investor before you make a decision on what kind of loan you're going to get. And that's why I always tell people, although you can't pre qualify or get pre approved for a commercial loan, you should be able to define your strategy beforehand and know what you're going after.

Steve Seymour: Yeah. With not getting pre-approved for a commercial loan, one thing that I've gotten frustrated with in the past is getting loan term sheets from commercial lenders. And then getting to closing, and then they're not quite what they stated. So, for me, working with commercial lenders, I tell them very clearly up front, don't give me a loan term sheet you guys can't deliver on.

I'd rather be padded a little bit. And be conservative because if I'm underwriting a deal and I know that the rates are changing. So it depends on what it is, but I've had multiple times where either the rate changes a little bit, or they have an interest reserve that they didn't put on the loan term sheet that they throw in there or.

They'll adjust the LTV down because of their risk tolerance on the deal. So, and I know until it's fully underwritten but when you're shopping commercial lenders or your broker is for you, I'm sure you do this as a service for your clients. You're a commercial mortgage broker, correct?

Trevor Calton: Yes. Evergreen Capital Advisors.

Steve Seymour: Because you're an advisor.

Trevor Calton: Yeah. www.Evergreen.llc 

Trevor Calton: And we'll we can talk about that at the end, but Yeah, so I'll tell you right out of the gate based on that comment, I have a, we have a long list of lenders and the lenders that honor their term sheets are always at the top.

So I know which lenders will take a little bit of a loss just so they don't have to retrade the terms on the client. And I know other bankers that I don't trust at all. . 

Steve Seymour: Yeah. Because as an investor, you could put yourself in a bad spot. Even if they offer you a 6% or six and a half percent rate, and that's what the deal's all underwritten for in this current environment.

And then you get to the table and it's 7.25. Well, you're already through your due diligence period. Your money might be hard now. At this point, you might have you know, you have your appraisal done. Other lenders might not want that appraisal depending on how it was conducted, who ordered it.

That you kind of have your hands tied at that point. So they'll give you, and sometimes they'll tell you like, here's your term sheet, but you know, the rates aren't going to be locked in until, the day of closing or, I mean, I, some commercial lenders do a hundred percent honor what they put on there and others don't.

And that's something to know and the value of having a broker to know that, hey this, these people are at the top of my list for a reason. Other people absolutely put some teaser offers out there, but they're not telling you they're going to have all these other requirements.

Trevor Calton: And that's why I say, if somebody quotes you a rate on the first phone call without asking you questions, that's a red flag and people, a lot of clients, we lose clients.

Sometimes I get frustrated because I won't quote them a rate without them giving me more information. But then I, that just tells me that they're less sophisticated and we're probably going to be more challenging to work with anyway, but you really want the people around you to demonstrate that they're invested in your success.

And it's not about just getting this one deal done. It's about you becoming a repeat client, somebody that you trust. There are a lot of people, I love it when they tell me, “Trevor, you're the only guy I have to call.” And I have a team of, we have six, seven brokers that work for Evergreen. And a lot of us have repeat clients and they don't ever call anything but our cell phone and they know like, Hey, we're going to handle it.

And then we're not going to go and just shoot them an interest rate. We're going to call them. We're going to sit down. We're going to talk about, okay, tell me about the deal. Where is it? What's your strategy? How long are you going to hold it? You know, who else is involved? And then we can say, okay, well, based on what you're telling me, we don't want longer than say a five year prepayment penalty, or you know, there's a lot of different things I had.

Speaking of prepays, I had a lot of clients I've been talking about talking out of getting into yield maintenance penalties. If we think rates are going to come back down, which a lot of people do, even a small dip in rate can be a huge prepayment penalty if you have yield maintenance structure versus step down.

Most people don't understand what that means, but that's why I say you want your advisors to demonstrate that they're invested in your success, not just say they are. 

Steve Seymour: Can you break down, at a high level, yield maintenance as a prepayment and kind of the risk with that, especially in this current environment, like you just said, just what does that look like?

You know, you, I don't know if you don't have to give an exact example, but in a general rule, conceptually.

Trevor Calton:  So in lending, most people don't realize, but prepayment is a privilege, not a right. When you sign a promissory note, you sign a contract saying you're going to make a certain number of payments and that's how your loan is going to get repaid.

The lender doesn't want to be paid back early. Just means they have to go and redeploy that capital into a different investment, and make a new loan. And so. That's why prepayment penalties exist is they are going to make a little bit extra money if they have to go and redeploy that money again somewhere else in residential that's all built in and prepayment penalties aren't allowed, but in commercial almost every loan has a prepayment penalty, and the step down is pretty easy right 5% in the first year 4% in the second year 321, but, and that's

Steve Seymour: 5% of the principal balance at the time of the payoff. Correct?

Trevor Calton: So, and yes, 5% of whatever is left of the principal.

Steve Seymour: Step down as well because pay down so it'll be reduced.

Trevor Calton: Assuming you're not paying interest-only correct. Yeah, the prepayment penalty that's called a “step down” is just going to add a couple percent to whatever your payoff is.

And it's pretty easy to calculate. Very easy to predict. Yield maintenance is a penalty that maintains the yield for the lender. So an example would be if you got a loan at six percent and a couple years later, you want to pay it off and the rates have dropped to four percent. The lender is going to say, okay, you owe us, let's say, a million dollars.

We were making 6% on that money. Now, if we went to deploy that, we could only make 4%. So you're going to pay us the difference. And not just the difference that year, the difference for the remaining life of the loan. So yield maintenance can be insignificant if rates go up, but if rates go down, even just a little bit, yield maintenance can be very unpredictable.

Steve Seymour: Yeah, that's a lot. So first of all, I think probably a lot of this one is over many people's heads, but I'm sure there's some listeners that gain some value. I appreciate you diving deep and going into content because a lot of times we talk. Conceptual mindset there's some real nuts and bolts in this conversation.

So if you didn't get it, you can go back and listen to it again. If it was if it sounded Greek to you, some of the lingo, but hopefully you guys can pull out your phone and Google some of these terms. If we're talking about LTV and all the basic terms that this was a conference.

This was not a conversation. One on one conversation. Let's say that

Trevor Calton: even better though. My Real Estate Finance Academy YouTube channel has a video on everything we talked about today.

Steve Seymour: And there you go right there. So you don't even need Google. 

Trevor Calton: I'm glad it helped. If any people have questions, we could always do a Q and A. So if we want to do this again, I'd be happy to.

Final Thoughts and Advice for Aspiring Investors

Steve Seymour: Absolutely. But I did have a couple more higher level questions, right? So you know, you have your, all your knowledge and your experience. I would now want to tap into your wisdom. So knowing what you know now, going back 20 years, two decades ago, when you kind of got into this if you were talking to yourself, what are maybe say the top three things that you would have potentially done differently or been more aware of?

Trevor Calton: Great question. I would have chosen fewer partners with more experience and because there were a lot of times when I was the most experienced person in the room. And that's okay. But you always say surround yourself with people that are smarter than you. I feel like I do that all the time, but I would have had more people that I could have leaned on that have been through the ringer a few more times.

And I say that in the context of 2009, because that was tough, but it was tough for everybody. And there's just things you couldn't predict. That's one thing. So just really like what you do. With even this podcast or just your networking surrounding yourself with other people who have really good perspective and some experience that you don't have.

And because when things inevitably do turn down, the cycle turns and things get tough. You want people that are going to remind you that it's not the end of the world and help you get through it. And that's, I think, really important because especially if you are syndicating or things like that, where you're the person responsible for other people's money, and then the market does turn, I'm sure a lot of people right out there right now are feeling this way.

Like, you can feel alone, you can feel like you're out on an island, and the world's coming down on you. And I remember one of the hardest experiences I had. Could have been solved with 50 grand. And, but I felt like my life was over. And so that's one thing. The other thing is not necessarily based on my own experience, but I think what I would tell people earlier and often is don't get stuck in the single family.

You know, thing. If you want to scale up, the sooner you scale up, the better, because the one thing that gets really challenging, scaling up into multifamily, it's harder and harder with every single family property you buy. And I'm saying single family is a bad strategy. I'm just saying, if you know that eventually you want to get into apartments, do it early, even if it's just five units, it gets so much more difficult.

To roll that equity into new investments when it's scattered amongst smaller properties. So that would be another thing.

Steve Seymour: Let's tap into number three. One more thing. You gave us two. One was to partner up, surround yourself with people. I kind of lumped that into one category. It was to surround yourself with better people, more experience. Number two was to get into multifamily sooner and later because it's not easy. It's harder to transition once you're spread out over a bunch of single families.

And I'm assuming you're saying that because of the 1031 and access to capital and all those things.

Trevor Calton: But absolutely. Yeah. And I would say if you are, regardless of who you are, if you are spending all of your time working, which I'm guilty of, have been in the past. Don't forget to delegate.

The Importance of Delegation and Work-Life Balance

Trevor Calton: Don't forget to just constantly have to be building your team, because if you're a good leader and a good manager, your people are going to leave because you're going to inspire them to do great things for themselves and their families.

And just don't forget to live your life a long way. Practice that gratitude. Spend time with your family. There's all the things on your desk and your to-do list are still going to be there and you're never going to complete all the things that you have to. And I think a lot of us, especially if you know we're motivated and we want to do great things and we want to build a legacy.

Sometimes we get solely focused on that. And then we forget why we're trying to build Alex and we are neglecting the things that actually matter, which is our families, our loved ones, the community. And so I would say, in the context of like, personally speaking, I need to be better at delegating and I'm fortunate that my wife reminds me “Hey, you're working hard enough. You are doing enough. Don't forget to enjoy it.”

Steve Seymour: Well, I appreciate you sharing that and that's what I meant by sharing your wisdom. So I'm glad I asked that question and I'm glad you shared that information, Trevor, thank you so much for your time. I know your time is valuable and you charge for this. So I'm very grateful. Thank you.

Closing Remarks and Contact Information

Steve Seymour: Anyone's listening. You just got a bunch of Trevor's information, but it's not as in-depth and it's not as broken down systematically as his training courses. So you guys could check them out. Trevor, why don't you share a little bit about your real estate training that you have online?

Trevor Calton: So my online training is a real estate finance Academy, and there's a ton of free videos, at least a hundred videos on YouTube. And then we've got courses for real estate investors, real estate agents who are getting into multifamily commercial and commercial lenders. And then my primary business is Evergreen Capital Advisors, which is easy to find at evergreen.

llc. And we do commercial lending, again, we specialize in multifamily investors. And just so you know, Steve, this is my favorite thing to talk about. So I'll talk about real estate to anybody who will listen. I think you would too. And so I'll. I'll come back anytime.

Steve Seymour: There's something wrong with me. I love talking about this.

Trevor Calton: Well, we've got people. Some people have to love it. Once will be us.

Steve Seymour: Yeah, I mean, we probably put a couple people to sleep by now. But if you listen through the whole thing, we appreciate your time and attention as well. And you know, we'll make sure to post Trevor's information below. So thank you very much.

And we'll be in touch soon. 

Trevor Calton: Thanks so much, Steve.

Steve Seymour: It was a good one. Thank you for tuning in to the Investor Agent Podcast today. We hope you found it valuable. Please tune in weekly at theinvestoragents.com.

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• Commercial Real Estate Agent & Broker Training
• Commercial Lender Training

Trevor Calton is the founder of Real Estate Finance Academy. Since 1997, he has analyzed, acquired, or sold more than $5 billion of commercial real estate assets, financed over 500 commercial investment properties, and overseen the asset management of over 6000 units of multifamily housing. He has been coaching and teaching real estate courses to investors and professionals since 2005, helping people at all levels develop a successful real estate investment strategy.