This week on the show, we’ve invite on a real estate expert: Moses Kagan! Moses is a partner of Adaptive Realty — a property management company in Los Angeles.
Adaptive Realty has a unique strategy with apartment buildings; instead of simply buying buildings and repainting and upgrading appliances, they do huge, wholesale renovations. They vacate all the tenants and completely redesign the properties. This enables them to double the rent whereas most apartment value ad folks incrementally increase the rent 20-30% after renovations.
It’s a very unique strategy, and in this episode, we’re going to get into all of the juicy details on how Moses has pulled this strategy off. We talk about how he originally fell into the industry 10 years ago, how he survived the early lean years of being a real estate entrepreneur, the mistakes he’s made along the way (including selling way too early for his first few deals), and finally, his graduation from short-term funds to more long-term permanent equity vehicles (where he can renovate the properties and hold them indefinitely).
Today’s episode was incredibly insightful and we hope you have as much fun listening to it as we had recording it!
Key Takeaways:
[:11] About this week’s episode with Moses Kagan.
[1:10] Welcoming Moses to the podcast!
[1:41] Moses explains what they do at his company, Adaptive Realty.
[4:55] Moses tells the story of how he got started (before starting Adaptive Realty) and some of his early experiences in buying real estate.
[22:02] How Moses originally got funding, and how they got people to leave the apartment so they could renovate.
[23:52] How they renovated the buildings to beat out the competition.
[25:25] Moses talks about the possible percentage increase for rent in these renovated apartments.
[26:52] Moses explains their second apartment deal, whether or not they were making money at this point in time, and how they made that second deal.
[29:05] Their strategy over the next couple of years for buying buildings
[29:19] Moses talks about what they did after having to liquidate all their buildings, starting back at “square one.”
[34:19] The steps Moses took when trying to rebuild: starting a blog, discovering that the best deals were the fixer-uppers, and ultimately, the creation of Adaptive Realty.
[44:09] After raising their first fund, Moses explains his next steps.
[48:37] What Moses recommends to anyone who is starting out in this business.
[49:24] How Moses and his partner continued to build Adaptive Realty.
[55:15] Moses discusses some of the challenges with their business model and the way their business has grown.
[1:00:22] Moses speaks about their progress towards more permanent equity.
[1:02:20] Moses’ advice to those new in this business.
[1:06:15] Where to find Moses online.
Mentioned in this Episode:
Adaptive Realty
Moses Kagan (LinkedIn)
Moses Kagan’s Blog
The Alternative Investor EP.38 — “We Talk to a Guy Who Bought a Business with an SBA Loan”
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