90% of millionaires make their money with their real estate. It is a tangible asset that can give one significant returns as long as they know what they are doing. However, most people jump right in without the knowledge of how hard it could be managing those properties especially for single family units. So, what should be your first investment? You should always invest in yourself and your education first! In real estate, there is a lot of money moving around, but too many people try to skimp on perceived education costs to go right for the big transaction, with dire consequences.
In TLP’s first ever Solocast, we are with our very own The Limited Partner Podcast Host, Jake Wiley. He is a podcaster, author, entrepreneur, CPA, former CFO, and head core client relationships for Private Equity Real Estate and Alternative Investments. Today’s podcast episode is focused on Jake’s biggest “why” he started venturing the real estate markets and started this show, his challenges and tribulations with managing multiple single family rental properties, and the advantages of being invested in a Limited Partnership.
The Limited Partner Podcast Origin Story: Intro
Jake can vividly remember the reason why he ventured into the real estate business. He worked as an accountant for a Big 4 Four Accounting firm when he graduated college. Happenstance had Jake assigned to a company acquisition of an oilfield services business in the middle of nowhere Louisiana. His work involved doing due diligence and reporting for the clients who are looking to acquire the said business. Those guys eventually made 12 million dollars from their 1 million dollar investment, which was all bank financed. In a moment of abject humility, Jake then asked how they did it. What they said changed his life forever: “You just had to be willing to take a little bit of a risk and then do what you set out to do.”
Jake's Challenges and Tribulations with Managing Single Family Units
After reading Robert Kiyosaki’s Rich Dad Poor Dad which lit the fire inside of him to pursue the real estate business, Jake was ready to take a risk of his own and set out to do what he committed to do. Over the next few years, a multitude of single family and duplex homes in over 5 states. He eventually became a jack of all trades, knowing how to rewire outlets, connecting PEX and PVC plumbing, replacing toilets, snaking toilets, installing doors and windows. Handling several rental properties at the same time had his hands tied, having to cancel a lot of vacation plans, hanging off roofs with roof ceiling tape in the middle of a rainstorm, evicting tenants, hire skip tracers, and load dumpsters. And it took years for Jake to realize that the tasks mentioned above are extremely exhausting and stressful on his end because as he said, “When you run a small project, at the end of the day, the problems always end up in your lap.”
The 16-Year Lesson
After 16 years of handling multiple single family rental properties across 5 states, Jake had been staring at the solution, commercial real estate and syndications - getting into a deal where you have a piece of the pie and you jump into a larger deal where all of these things are handled at scale. Commercial assets are managed by professionals who are better trained to find deals, fix problems, and operate at scale than Jake could ever be.
The Advantages of Investing Real Estate Through a Limited Partnership
According to Jake Wiley, there are four (4) compelling advantages to start investing real estate through a Limited Partnership.
- Zero Operational Responsibility - Being a Limited Partner means that you won’t have to deal with the operational issues regarding the property e.g. changing damaged roofs, answering tenant phone calls, snake toilets, rewire outlets, fix busted air conditioners, and etc.
- 100% Professional Management - Since professionals are working for you, expect them to find better deals, to increase property values better, to operate properties much better at an effective cost.
- Probable Higher Returns and Diversification - Being a Limited Partner opens the doors to higher returns in the form of passive income. And according to Arn Cenedella, it allows diversification of investment portfolio across other markets you won’t even know.
- Time Freedom - Most people probably do not know this. But the real resource in this world is time mainly because time that passed by cannot be brought back.Being a Limited Partner frees up more of your time. Having the time to spend with your loved ones and passions while having the access to compounding and significant returns is a bigger trade-off than managing an exhausting and stressful multiple single family rental business.
Who is Jake Wiley?
Jake is a podcaster, author, entrepreneur, CPA, former CFO, and head core client relationships for Private Equity Real Estate and Alternative Investments.
With nearly two decades of professional experience building businesses, solving problems, and implementing solutions, Jake has the ability to serve his clients from the perspective of having sat in their seats.
He founded a Louisiana-based Residential Solar Finance and Installation Company, which was later acquired by Palmetto where he led strategic initiatives until late 2018 and then moved on to be a Chief Financial Officer and Chief Compliance Officer at an RIA fund focused on commercial solar.
He has been investing both passively and actively in Real Estate for more than 16 years, raising private funds for strategic value-add investments and long-term holds. This is a true passion of his, so much so that he has a Podcast, The Limited Partner Podcast, where he gets to interview and talk to some of the best of the best in the space to learn how they are making it happen.
His diverse industry experience in both corporate and startup companies, as well as layered work experience as an executive, founder, and advisor, allow for unique, well-rounded, and informed perspectives that he is always happy to talk about.
- LinkedIn— https://www.linkedin.com/in/jakewiley/
- Website— thelimitedpartner.com
- Facebook— https://www.facebook.com/TheLimitedPartner
- Instagram— https://www.instagram.com/jjakewiley/
- Twitter— https://twitter.com/jjakewiley
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