Episode Transcript
Speaker 0 00:00:00 Hey everybody. Welcome to episode four of the Philadelphia Wealth Project podcast. Is it four? It's four. And today we are gonna talk about how you can make 200 to $400,000 you with Steve on one project. Yep. And that's pretty incredible. So we're gonna dig into how that happened, all the challenges around it, everything that I wanna know. Cause I got questions. I got a lot of
Speaker 1 00:00:26 Questions for you, Sean. I got some answers for you.
Speaker 0 00:00:27 All right. Don't lie to just me. Don't lie
Speaker 1 00:00:29 To me. I'm gonna hide the truth.
Speaker 0 00:00:31 <laugh>. So who are you again?
Speaker 1 00:00:34 What's going on everyone? My name is Sean Connors. I'm the managing broker here at Vanguard Realty Alliance. I'm also a real estate investor here in Chester County, as well as the Pocono Mountains.
Speaker 0 00:00:45 Nice. Yes. I'm Rob Lawrence, lead of the Rob Lawrence team, and, um, a realtor here at Vanguard. And, uh, I'm also an investor. Woo. Yeah. I got love for out right now, speaking of the devil,
Speaker 1 00:00:57 Speaking of investment properties, how the heck is your Florida house doing? Yeah. You were like right in the eye. Right.
Speaker 0 00:01:03 So we actually went down. What? And we were in, uh, we were there like on Tuesday, and we were supposed to fly out Tuesday at five. So we saw this whole thing building like the whole weekend. I'm like, you know, the news always hyping everything up. Right? So you're kind of like, is this real? You know, like you're kind of asking yourself that. Right, right. And yeah, it turned out to be real. So <laugh> the, uh, you know, Monday came around and we found out our Tuesday night at five o'clock flight. They, we had a five 10 flight. They closed the airport at five. Whoa. So me.
Speaker 1 00:01:35 So were you there? And they closed it?
Speaker 0 00:01:36 We didn't go to the airport. We found out Monday night. Okay. And my wife was like, what do we do? What do we do? And I was like, I don't know, we've got a car like we can drive. You know what I mean? And my wife's like, well, what if they want the rental car back? I'm like, I'm not giving it back.
Speaker 1 00:01:50 <laugh>. It's mine.
Speaker 0 00:01:51 Yeah.
Speaker 1 00:01:51 Keeping
Speaker 0 00:01:52 It. They can call the cops on me, whatever. I don't care. So yeah, we had to like drive, um, with me, the kids grandma, we drove seven hours to Atlanta. Um, we just started driving at first. Like we went to bed Monday night, woke up at 6:00 AM on Tuesday morning, and we just drove Wow. Um, to, we started driving north. My wife found a flight on the way we booked it. We booked a hotel and we flew out at 5:30 AM on out of Atlanta on, uh, that'd be Wednesday morning. Wednesday morning. Yeah. Yeah. And then got back and, um, you know, my neighbors, some of them hung out and, and, uh, you know, videoed it. So we're in Clearwater Beach and fortunately for us, but unfortunately Fort Myers, the, the hurricane just hooked hard to the right and, and went in down there and we still got high winds and some, I think some flooding.
Speaker 1 00:02:37 Any damage.
Speaker 0 00:02:39 My neighbor, the siding got pulled off of her house. Okay. And, and, and a portion, I think some water got in. But our house, I don't know, I actually just gave my neighbor the code so she could go check it out. But they've been sending me videos and stuff. Okay. Um, but I think, um, I think it's doing okay.
Speaker 1 00:02:52 Do you have hurricane insurance on that property?
Speaker 0 00:02:55 Y yeah, guess so. I, you know, funny enough, I actually got a email. I got an email from the insurance company, literally like yesterday saying, oh, hey, by the way, we're not gonna be insuring your house anymore, uh, come January. So go find some, some, someone else to insure your house. Wow. And oh, we might have someone there a thousand dollars more a year. Ooh. So yeah, jumped from like 1400 to 2,400. Yeah. I was like, no, that's,
Speaker 1 00:03:17 They did that to me with flood insurance. Really? Yeah. It went from 1200 to 8,000.
Speaker 0 00:03:25 Dude,
Speaker 1 00:03:25 That hurts. We got a new policy, but it still went from even then 8,000, $8,000.
Speaker 0 00:03:30 But what'd you end up getting?
Speaker 1 00:03:31 Um, 2200. Okay. So it still went up a thousand. Yeah.
Speaker 0 00:03:35 You gotta
Speaker 1 00:03:35 Shut flooding in down in town. That's what you have to be warrior. Uh, mindful of. If you're buying in
Speaker 0 00:03:39 Downingtown, you gotta be aware. Yeah. Yeah. I mean, hey, there's hurricanes in, uh, Florida. That's part of, I guess owning a Airbnb in Florida. But honestly, actually got a message today. Someone wanted to rent it for like 80 days from like, starting in two weeks. Nice. So this whole fall, my book. Yeah. Yeah. Really pumped about that. Yeah, for sure. That's awesome, man. So, um, Sean, I think we should talk about what's going on with the Philadelphia Wealth Project, what it is. And,
Speaker 1 00:04:05 Uh, I think we should too. Yeah.
Speaker 0 00:04:07 Do you wanna talk? What's,
Speaker 1 00:04:08 What's the Philly Wealth Project? We're Philadelphia. Sorry.
Speaker 0 00:04:10 I know Philly
Speaker 1 00:04:11 Is not. I know, I know, I know. I abbreviate it. But tell everyone
Speaker 0 00:04:15 <laugh>. So the Philadelphia Wealth Project is partly this podcast, it's meetups, it's actual implementation mm-hmm. <affirmative>. Um, and it's, it's a community. It's kind of like a hive of investors and they can be, you know, like agents, but they can also be clients. Right. Um, you know, you can be an experienced investor, unexperienced, but we're all coming together to help each other build a hundred million dollars in wealth over the next five years.
Speaker 1 00:04:39 Five
Speaker 0 00:04:39 Years. And we're gonna get things kicked off in December here. So if you wanna be part of the Philadelphia Wealth Project, reach out to us. It costs nothing, but it's basically just, I dunno, it's like an organization. It's like a loose organization for
Speaker 1 00:04:52 People. Yeah. It's, it's, um, it's like a nonprofit. Yeah. Right. That's like a really, I wanna
Speaker 0 00:04:56 Make profits though.
Speaker 1 00:04:57 Yeah. We're gonna make profits. But like you, it's a very
Speaker 0 00:04:59 Profitable nonprofit.
Speaker 1 00:05:00 It's a profitable nonprofit. Yeah. <laugh>. You don't have to pay to be a part of it. Right. But again, it's just a community of like-minded people, investors, agents, consumers, people who wanna start investing. People who have been investing. Yeah. We're gonna get together and we're gonna help each other build wealth.
Speaker 0 00:05:17 Yeah. It's gonna be awesome. I mean, a hundred million amazing dude. Yeah. And you, you know, when you say, when you break it down, it's like a hundred people is a million each. Right? Like, okay. That's very doable.
Speaker 1 00:05:26 It
Speaker 0 00:05:26 Is. It's very doable. It's very achievable with real estate. I actually think we're gonna, I think we're gonna blow that
Speaker 1 00:05:31 Outta the water. I think we will too.
Speaker 0 00:05:32 So if you wanna be part of the Philadelphia Wealth Project, we're gonna have, I think we're gonna probably do like a Saturday afternoon. We're gonna do a kickoff event where we're gonna go through your net worth, your goals, and then a plan Okay. On how to do this and, and over for the next year to help you build wealth in that year. Um, and it's a lot of centered around real estate investing, financial prowess.
Speaker 1 00:05:53 Where are we gonna have it?
Speaker 0 00:05:55 I think we should have it in our new building.
Speaker 1 00:05:57 Good segue.
Speaker 0 00:05:58 <laugh>. Yeah. So, you know, Sean, uh, I heard you, uh, bought a building.
Speaker 1 00:06:04 Yes. Steve and I, we purchased a building for the brokerage.
Speaker 0 00:06:08 I'm so excited
Speaker 1 00:06:09 About it. In Westchester.
Speaker 0 00:06:11 I get to rent an office in there. Yeah.
Speaker 1 00:06:13 <laugh>. It's gonna be awesome.
Speaker 0 00:06:15 I know. I get to hang out with you all day every day. Oh,
Speaker 1 00:06:18 <laugh>. I'm so excited. <laugh>. Gosh, what am I gonna
Speaker 0 00:06:21 Do? You lost the lease already, huh?
Speaker 1 00:06:23 My door has a lock.
Speaker 0 00:06:25 <laugh> blinds. No
Speaker 1 00:06:28 Open door policy. <laugh>.
Speaker 0 00:06:30 I'll be locked in this room. Text me, <laugh>, text me to get it. So I actually hear you're gonna make a little bit of money on this thing. So tell me about the numbers on this one. We
Speaker 1 00:06:38 Are. So just a little backstory Yeah. Of the property. Uh, I guess it was towards the end of last year. So Vanguard umbrella, there's three companies, right? Vanguard Realty Lines, LLL C, which is the real estate brokerage. We have Vanguard Settlements, which is our title company. And Vanguard Lending, which is our mortgage and lending company, they have all existed in our current office right now, which is in Westchester Borough, 3 0 7 North Mono Street. It's a little small.
Speaker 0 00:07:09 Looks like a house. Kind
Speaker 1 00:07:10 Of. It is a house. It's a house. It's literally a twin
Speaker 0 00:07:13 <laugh>. It's a half
Speaker 1 00:07:14 House. It's a half house. Yeah. Um, so we, we've coexisted for years now, right in this little space. And the title company's growing. The real estate brokerage is growing, lending's growing at such a rapid pace. We're like, we need a, we need a bigger space. So at the beginning of this year, um, I like to say I found the deal. Steve said he saw the deal,
Speaker 0 00:07:35 Like trying to take your thunder. I
Speaker 1 00:07:37 Don't know. I don't know. He's like, he's like, yeah. Oh, I saw that before. But I was, I said to him, cuz we were looking on CoStar. Yeah. And I said, we should go look at this property. He's like, all right. So we looked at it in January and it was listed at it, it originally was listed at, I believe it's, it was on the market for two years. Wow. Off and on for two years. Wow. I think the original listing price was 1.3 or 1.2, somewhere around there. Okay. When we looked at it, it was listed at nine 50. Okay. And we looked at it in January and we're like, ah, you know, I don't know. May not make sense. It might make sense. Fast forward a couple weeks or maybe a month, the agent that we were talking to left that company and he ended up going somewhere else. So someone else took the listing over and we, you know, we were again interested in thinking about doing it. Yeah. And um, in March we looked at it again and then we decided to put an offer in and we, we offered five 50.
Speaker 0 00:08:40 That is less than asking.
Speaker 1 00:08:41 Yeah. It was $400,000 less than the asking price <laugh>. Yeah. And um, they came back at six 50 I think.
Speaker 0 00:08:50 Okay. Wow. They came, they dropped a
Speaker 1 00:08:52 Lot.
Speaker 0 00:08:52 Yeah. Right
Speaker 1 00:08:53 Off the bat. They dropped what, what's that? 3, 300, 2 50.
Speaker 0 00:08:57 You went from nine 50 to six 50,
Speaker 1 00:08:59 Right? Yeah. 300,000. 300,000. Yeah. And then we came back at 600.
Speaker 0 00:09:03 Gotcha.
Speaker 1 00:09:04 And that's what we got
Speaker 0 00:09:07 Hell of a deal went from 1.3 million to 600,000.
Speaker 1 00:09:10 We went from 1.3 or 1.2, whatever it was. The 600,000 Yeah. Half off. So we got it half off. Yeah, exactly. Half off the original living testing price
Speaker 0 00:09:18 Than like going to like five below. I know you our dollar even dollar stores a dollar 25 now. Yeah.
Speaker 1 00:09:23 <laugh>. So we got this an amazing deal. It's 10,000 square feet, little bit over 10,000 square feet. Nice. In a condo complex. It's, uh, 1244 West Chester Pike. And it was formally owned by Chester County Hospital. That's who we bought it from. Oh. So they had it as like a training area, um, for the hospital. And then we have one, cuz it's a condo association.
Speaker 0 00:09:49 Okay. So
Speaker 1 00:09:50 There's five big buildings total, which are probably about 20,000 square foot apiece. Mm-hmm. <affirmative>, we have the entire second floor. And then we have an office suite downstairs. Right. So we have settlement, Vanguard Settlements downstairs, Vanguard Realty Lines upstairs, lending. And then we are going to lease out half of the property as well. So
Speaker 0 00:10:12 Did it need work?
Speaker 1 00:10:13 Did what work? Did
Speaker 0 00:10:14 The place
Speaker 1 00:10:15 Need work? Oh, did it need work <laugh>? Yes, it did. Yeah. So it was rough. Yeah, it was, and it was vacant for like two
Speaker 0 00:10:24 Years. Maybe you can throw some old video in here, like in this podcast.
Speaker 1 00:10:27 Oh yeah. We'll, def I have some, I have some old, uh, I have a lot of old pictures and definitely some old video. Oh yeah.
Speaker 0 00:10:32 I gotta share that.
Speaker 1 00:10:33 It needed a lot of work. Like it was, it was bad.
Speaker 0 00:10:37 Got you. How much work did that work end up costing?
Speaker 1 00:10:40 So we are probably going to be all in for about 300 grand. Yeah. Not including furnishings.
Speaker 0 00:10:50 I guess the question is, all right, you've invested 600 now 300, so you got 900. Yeah. What do you guys think the value's gonna be when you're done?
Speaker 1 00:10:58 That's a great question. So with commercial properties, and I didn't know this cuz I'm very new to the commercial world, they do an As is arv No. As is Value, and then an arv. So after Repair value. Got you. So the As is value at, at the time we bought up seven 50. Okay. So we were automatically $150,000 of equity gain, which
Speaker 0 00:11:20 Is great. Just when it was all
Speaker 1 00:11:22 Dump. Yeah. When it was all dump. Exactly. The new or the ARV that they had was, uh, I think it was 1.2 something, 1.2 million. Okay. Or 1.15 million. Some, somewhere around there. Okay.
Speaker 0 00:11:35 So that's 300,000 gain.
Speaker 1 00:11:37 Yes. Um, and we ended up doing a little extra than what we thought we were gonna do and we're also going to be leasing half of it, which might add some value to it as well
Speaker 0 00:11:48 Because they look at like the financial performance of the asset.
Speaker 1 00:11:51 Exactly. Gotcha. So it could potentially go up to 1.2 and a half, maybe 1.3, somewhere like that.
Speaker 0 00:11:58 Wow. That's amazing that you can make that hundreds of thousands of
Speaker 1 00:12:01 Dollars and you hundreds of thousand dollars. Yeah.
Speaker 0 00:12:02 Yeah. Dude, high five.
Speaker 1 00:12:04 Oh, I'm so happy I got that high five. That was a pretty good one. That was the Rob Lauren High five
Speaker 0 00:12:08 <laugh>.
Speaker 1 00:12:09 That was the real deal.
Speaker 0 00:12:10 That was the real deal, man. Yeah. Well, I'm, I'm so excited about this building. I'm leasing a space in it myself. I'll have my team there. Um, and I, I know, I know it's gonna be a really collaborative environment. Right. And just like putting all the real estate investors together is gonna be other services there that are gonna be, uh, complimentary. Yeah. I guess you could say. Right? Like counting and whatever.
Speaker 1 00:12:28 Yeah. So we have our whole idea around this was getting his face big enough where of course we can have the real estate brokerage title, company lending, and also to bring in other companies that all mesh well together, you know, so we have a media company, uh, cpa, we have you <laugh>, Rob Lawrence team. What do I do? I know. Um, we have a residential home cleaner, possibly, um, an insurance agent that our personal insurance agent for the company. So it's a very collaborative workspace and we're super excited.
Speaker 0 00:13:06 So I know, like you and Steve, this is not your first deal, right? I mean, you know, when people No, it's not. And I think that's always a thing to remember. Right. And as we're doing this Philadelphia Wealth Project, it's about taking people along the path so that they can get to this level of deal, you know? Mm-hmm. <affirmative>, and I know Steve's like done a lot of flips and you've done a lot too. So it's like, you know, what do you think people should think about like, in getting to this kind of level?
Speaker 1 00:13:28 Well, I really think that you need to, the ultimate thing to do when you first set out to start investing in real estate is to figure out what your actual end goal is. You know,
Speaker 0 00:13:42 I'm still figuring that out, <laugh>
Speaker 1 00:13:43 Yeah. But that's like the best, and and it'll, it'll change over time. Right?
Speaker 0 00:13:46 Right, right. But
Speaker 1 00:13:48 If you asked a hundred investors, I guarantee a hundred of them would say financial freedom and some capacity. Right. When you think about investing in real estate, it's, I want some kind of financial freedom. You know, I want generational wealth. I want my money to the, my passive income to exceed my active, um, expenses. You know? Right. So I to dream. Yeah, exactly. So you have to figure out what your number is.
Speaker 0 00:14:14 So when someone's getting started, I mean, like, you know, I guess like probably flipping a house, right? Mm-hmm. <affirmative> or renovating a property, you may make 50 or a hundred. Right? You're not gonna make 400,000 probably your first deal. No. But once you start like doing those things, you kind of get used to it, right? Yeah. Like you kind of like know the numbers and you start understanding the math and then in the end, right. It just kind of,
Speaker 1 00:14:32 It's like anything else that you do repeatedly and consistently. Right. You just figure out what you're doing.
Speaker 0 00:14:38 It's iterative. You get better and better
Speaker 1 00:14:39 At it. Right. And the great thing is like, you don't have to do it alone, which is why we create the Philadelphia Wealth Project.
Speaker 0 00:14:45 Right. And it's like, you did it with Steve, you know, and it's like, you know, Steve's obviously got a ton of experience mm-hmm. <affirmative> in real, real estate mm-hmm. <affirmative>. And, um, that's the awesome thing about being part of this brokerage is just your exposure to all of this. Exactly. Well, Sean, without further ado, I gotta go see this place with you, man. Let's go check it out. All right, we're gonna do the tour now, guys, of the building of its current state. Okay. See you there. See you.
Speaker 1 00:15:07 All right guys. So this is 1244 Westchester Pike. Like I was saying before, we have the entire second floor here and we have Suite 4 0 1 down here, which will be Vanguard Settlements. So let's go take a look. Yeah. So Vanguard Settlements, for those who do know, for those who don't know currently Vanguard Settlements is Vanguard Realty Lines, we're all in the same space. So now they're finally gonna have their own separate space. We have two settlement rooms, and then we have our settlement agents that are gonna be out here. Doug is gonna have his office in here, and it's just gonna be way more conducive for bringing all more business and having more settlements at the same time. Yeah. So we're on the sec. Vanguard Realty Alliance is on the second floor. There is about 9,000 square feet, give or take up here. We will be occupying half of it, maybe, maybe a little less than half, and the rest of the spaces are going to be leased out.
Speaker 1 00:16:10 So when you first walk in, we have our new reception area just was just custom built. Nothing was here before. It was completely empty. It was old, like 20, 25 year old carpet. The paint was horrible. Um, the ceilings were, everything was replaced. They had those like hospital fluorescent lights up that we replace with the high hats and have our logo here on the backdrop. And it's just, you know, a much more inviting space. You know, like kind of where we're at now with Walnut Street. It's, again, it's, it's twin, it's a house. So you just walk in, right? And it's, you know, we have Tracy there, or who's our amazing admin. There's nowhere for her to go, right? There's nowhere for her to work. So she's gonna have this, her own space here now, and that's gonna be ideal. So one of the things that I'm really excited about is having this kitchen space. And as you can see, we're almost done right here. We're doing a live edge countertop. We just got the quartz countertops installed, back splashes up. It's going to be awesome. And, you know, we're gonna have that area, which I love, where agents can come, you know, congregate, talk to each other. It's going to be like a legit office space now, which I really like.
Speaker 0 00:17:32 Sean, I think we should keep the plastic on just so stuff doesn't get damaged.
Speaker 2 00:17:36 <laugh>.
Speaker 1 00:17:40 I can only imagine. I can only imagine what people would say coming in and seeing the plastic everywhere. But yeah, it's a, again, it's just gonna be another space where people can come and we have Vanguard Mortgage that's going to be in this office space here. Our good friend Mr. Sean Phillips could have his own spot. Um, we have two additional offices that we are going to be leasing out to our agents. It's kind of the first come, first surf. So pretty much anyone who's interested my idea for this area, and, uh, we could just take a quick peek at this space. So for here, for this, you know, there was this builtin bookshelf area, um, that we decided to keep because we need storage space. So my idea is to have like a take a book, leave a book, you know, those little, little libraries that people have in front of their houses, but like for real estate, but for real estate and business, and then health and wealth and personal finances and things like that.
Speaker 1 00:18:45 So I'm gonna bring a ton of books here. I really hope a lot of other people bring their books that they, you know, they're not reading anymore and they have gotten a lot of value from it. So that's my idea for this is going to be our personal little library. Little real estate library. Yeah. We'll have our copy room here. No, nothing too exciting. And this, this is what's gonna be, uh, one of the best spots in for the entire building. This is the new training room. You can, you can drill, man. Yeah, we don't care. Yeah. So this is gonna be a new training room. Um, Friday morning masterminds are gonna be here. Investor meetups will eventually be here. Maybe the cloud of agent event. I don't know if it's big enough, but we'll, we'll cross that bridge when we get there.
Speaker 3 00:19:30 I want to see the
Speaker 1 00:19:30 Potty <laugh>. Yeah, the men's room. Everything is, uh, coming along really well. Oh, the vanity's in, I didn't even realize that. So this is the shared space. Actually behind us is one of our favorite potential, uh, leases. This could potentially be the, the Rob Lawrence team. Now this will be the Rob Lawrence team. This is his, his new sanctuary for him and the, uh, amazing agents that he has working with him right now. Good spot. Again, paint floors, ceiling tiles, high hat lights, everything. New brand, new HVAC system. This is going to be a lounge area for the second half of our space. And then we have private office 1, 2, 3, 4 private offices here across the way is another private office. It's one of the bigger ones. About 350, 400 square feet, give or take. So part of the second half, I, I'm just gonna call it the second half is there's another, uh, shared kitchen here.
Speaker 1 00:20:38 Just put up the back splash countertops in too. So nothing fancy. We'll have a refrigerator in here for people to store their food hanging out and eat tabletop. And then we have two larger offices here, which are currently being leased by one company. It's a, it's a secret. It's a nice company. Yeah. So it's really, we're really living into the whole collaborative nature of, of Vanguard and being in alignment with other companies that are within real estate. So that's like super exciting to lease this out to who's coming into this space. Yeah, so we're right on route three, which is really nice. As you can see over there, the exp realty. There's, uh, century 21 over there. And then we're also next to a Berkshire Hathaway office, which hopefully the, all three of them can merge into v <laugh>. You never know <laugh>. Yeah. And now let's see. The last and best part of the whole building.
Speaker 2 00:21:53 I
Speaker 1 00:21:53 Wanna see it. Dun, dun, dun dun.
Speaker 1 00:21:58 This is the Future podcast and video room. And yeah, this is, in my opinion, the, the absolute best part. I can't wait. We have so many different ideas like floating around for what we want to do, but we're probably gonna break it up into two different sections. So we'll have like your more lounge area here where you can sit, hang out, have a podcast, probably have a tabletop over here where two people can have a conversation. Um, and then also potentially have a section here where agents can come. Because we know not a lot of people are well-versed in video, right? They're not gonna go out and buy the $500 camera and the $600 lens, and maybe they just want to come in, pop their phone on a stand, do a quick little video, and then get the heck out. So we're gonna have probably two, two or three different areas where agents can come in, film, get what they want, and then pass it off to their editor. And yeah, it's just a really exciting space. And, um, but this is the space.
Speaker 1 00:23:01 So in addition to the private areas that we're gonna have for agents, this is gonna be a shared space that we're gonna have for agents and we're really excited about. We're gonna have desks, line the walls, different seating areas, so any of the agents that are part of the brokerage, if they feel the need to get outta the house, they want to come in, get some work done, we're gonna have these work spaces, work stations, right, set up, ready to go for them. And all you have to do, just come set up your stuff and then you have your own area to work that's not at your house. And a lot of people are, um, more so now wanting to get out of their house and get into the office. Sean, thanks for the
Speaker 0 00:23:44 Torque. Uh, here, we're here in your office. I think this place is gonna be awesome. I was saying this is gonna be like the Silicon Valley of real estate and I really believe that. I think there's gonna be a lot of great minds in this place. Um, I'm super excited. It's gonna be a great place. We're gonna have the event for the Philadelphia Wealth Project here. Um, and, you know, future events and stuff. And it's, I think it's gonna be a great place for just real estate investors to come and collaborate, for realtors to come and collaborate. It's the future, baby.
