3 years. Nearly 30 units. With $30k. Financial independence.

[James Johner]

When I first heard the term “Financial Freedom” I was anxious to know what that felt like. To be “retired” financially and have the ability to do...well... nothing if that’s what I wanted. Well, there is not a chance in hell that I’m going to sit around and twiddle my thumbs. 

Last night I was going over my finances, and have been so busy on the grind that I hadn’t even thought about the ”goal” of financial freedom and then all of the sudden it hit me. I’m here. I did it. And the best part, I’m enjoying doing what I do so much I don’t even really care. I’m still a beginner. I still feel like I’m just figuring it out. At dinner I brought it up to my wife, because what else do you talk about at dinner with your wife other than business and real estate...seriously, what else is there to talk about?, and we started along about the sequences of events that got us here and I felt like a short glimpse into my story may help someone understand it’s possible!  I’m a real person, who stumbled across Rich Dad Poor Dad and figured it out!  So, below is my story. Hope you enjoy. 

I started on my financial literacy journey in 2011. Not knowing what the majority of the terminology was etc. fast forward 5 years, I read every book you can think of, listened to as many podcast available(in 2016) and talked, discussed, networked as much as I could before we jumped into a niche of real estate most people aren’t familiar with...Salon Suites. 

Salon Suites are nothing more than specialized piece of commercial real estate. Individual store fronts upfitted under a master lease then subleased to individuals that want to operate their own salon. It was a struggle. No one, and i mean no one wants to give a “Salon” a 100k to upfit a space. So this is where it gets interesting. Having very little money of our own, my wife and I built a business plan, solidified out business model, researched and researched and researched other businesses that were doing the same thing thing we hoped to do(sola salon Suites, my salon Suites, etc) and finally convinced a  local bank to loan sub 48k. Half of what we needed. Determined to make this work, I pulled “unsecured personal loans” from two we separate banks. How I managed to get two separate loans is a bit of a long story and what I refer to as “drug deal” part of this particular deal (I know it’s not politically correct, my wife tells me all The time its a terrible way explain stuff but I can’t help myself). Total budget 120k for turnkey upfit of nine units projected cash flow of 3800 at 100% occupancy. Actual cost 105k. We have been at 100% occupancy since month 6 of being open for business. Actual cash out of pocket $5k. 

Duplex development. This one was a bit of a bear and a serious learning curve. As a commercial GC by trade this job was setup for success from the beginning. Easy construction, no brainer finances in a hot rental market right outside of a big military base. The hurricane Florence.... long story short, this took way longer than anticipated, labor was extremely difficult to find and priced sky rocketed. Ultimately we will exit this deal( closing scheduled for this week!!) we will double our cash in this deal and use it Toward a future investment. Total cash in deal $20k

Apartment building. My favorite. Why didn't I do this sooner? Go big or go home. I told my wife, worst case scenario we lose everything we've got a have to move back in with my parents! About 6 months ago I reached out to the broker that advertised the space that our salon Suites is in (weird how handy networking is) and told him I was in the market for a 750k-$1m commercial property. I don't have a bunch of Capital laying around but I just wanted to figure it out. About 3 months later I get an email from my broker that he has sources an off market 18 unit apartment building and wanted to know if I was interested. Being the hell yea type that I am I signed up for a showing. Ultimately it was a great property, B class, great area. Three blocks from the water. No brainer. The struggle. I didn't have 200k for the down payment. Busted butt to find a bank willing to fund the deal with little equity up front. No go. Then I took @brandonturner advice and started telling everyone I knew what I was doing and looking for. Long story short I was able to find a investor that Put up 33% of deal in cash. I have them 33% equity. I pulled a 70%LTV, 25yr am, 7 year balloon commercial loan and bam!!! I owned and controlled an apartment building complete with management and acquisition fee. 95k NOI on this deal and is a long term hold.

Thanks for reading. I could have written a novel about all of this so wanted to keep it short and to the point. Please let me know if you have any questions would love to dive deep!!!

[Vish Patel]

@James Johner James, what an amazing and inspiring story and journey of yours! Congratulations man! Way to go. Nice work figuring out your way. As you said, time flies when you're having fun, and you didn't even realize it that you've reached financial independence. Cheers! 👍

[James Johner]

@Vish Patel

Thanks! Sorry for all of the typos. Time sure does fly when you are having fun. Truly enjoying this journey.