Table of Contents - Being a “Doorpreneur” with Tony LeBlanc
Dave Debeau [00:00:08] Hey there, everyone, this is Dave Debeau with another episode of the Property Profits Real Estate podcast. And today it is my pleasure to be interviewing Tony the Block all the way from Moncton, New Brunswick. And Tony is. Congratulations, Tony, a brand new author as we're doing this, this recording, his newest book. Let's look at the cover there. My friend and
Tony LeBlanc [00:00:34] I do, of
Dave Debeau [00:00:35] course, one area or Proner, his latest book or opener and hot off the presses for the last two weeks, I think he said, awesome. So welcome to the show, Tony. How you doing?
Tony LeBlanc [00:00:46] Thank you very much. Very good. Thank you.
Dave Debeau [00:00:48] Excellent. Excellent. All right, Tony. So we're going to be talking a lot about your book Door Opener, which I think is an awesome title. So hats off to you. But before we jump into that, tell us a little bit about yourself, your background and what your main focus in real estate investing is right now.
Tony LeBlanc [00:01:04] Sure. Pleasure. So I came from a on the second generation property manager. So I've been around apartment buildings my entire life. I grew up from the age of when I was born to 16, and we lived in the same apartment building here in town where my mother was the resident manager of the apartment building, and she was also the VP of the management company that owned the building. So I've literally been around this business for for so long. I grew up taking care of the hallways, dealing with tenants, all that stuff, what was ingrained in me. And I also was lucky enough to get some mentorship very early on from the owners of that management company. And I kind of got a taste of what it meant to own real estate that started very, very young, which I now look back and was like, yeah, that's kind of probably where this all started. I didn't get started in the industry immediately. I've actually my first love was technology. I had a 15 year stint with IBM as a software engineer and I loved every minute of it. I got to travel the world to see a lot of different things and work with some of the biggest companies in the world. However, the last few years, the traveling was getting a bit much. I had a family, two small kids, and it was getting to be a little bit tough to be gone three weeks out of the month. So I decided I had to kick my my entrepreneurial stuff in high gear in order to be able to exit that. So in two thousand nine, I started my own property management company that still exists today. Fast forward for now in three provinces. We manage close to two thousand doors and we've been able to spin off six additional service companies that are attached to the management company. And most recently, I've now bottled that into a book.
Dave Debeau [00:02:50] Excellent. But before we jump into the book, which I definitely want to focus on primarily, are you also investing in multifamily properties yourself?
Tony LeBlanc [00:03:00] I bought my first Travelex when I was twenty three and I've had I was up to about 40 50 units at one point. Now we've got I think we're down to twenty seven. So still not always investing my friend.
Dave Debeau [00:03:13] That's pretty good. Me primarily in and around Monkton or where are most of your personal properties. They're all in all the money. You don't. I'm embarrassed to say I've not visited your beautiful province. Yeah I know. I've been to Nova Scotia. Yeah. But I haven't you know, I might not that might be a fib. I might have gone through part of it, but I haven't spent any time there and I need to rectify that, that's for sure. I've heard nothing but green stuff.
Tony LeBlanc [00:03:41] I'm telling you one secret. And for your listeners that if you have a lot of listeners out of DC, the East Coast is a gold mine and a little gem for those guys in the West Coast because of our pricing. Our door economics here are a different it's a different world from DC or even in Toronto. So I would say out of one hundred and twenty investors that I manage for, I'd probably say fifty percent of them from DC.
Dave Debeau [00:04:07] That's incredible. It makes sense, right? Because I mean, the property prices are crazy. But let's jump into dorper. No, because with your background, with your history, the fact that you grew up in this business and just as a kid, we're active in it, it just seems normal. You know what that provides a lot of us as real estate entrepreneurs is a whole idea of dealing with tenants in toilets. We kind of have to do it. You've been doing it second nature to you. It's no big. You've seen, I'm sure, everything under
Tony LeBlanc [00:04:38] the sun I have up and
Dave Debeau [00:04:40] I have and it doesn't scare you. So let's jump into that. Let's talk about well, I don't know what we want to call it, dorper inertia, but basically the idea of of managing our properties, maximizing the revenues that we can get from our property. So tell us a little bit about that. And, you know, we were talking off camera about some of the cool stuff that you do that most property managers. Think of or most real estate entrepreneurs don't think of when it comes to really maximizing revenues from their from their business.
Tony LeBlanc [00:05:15] Yeah, so the whole I definitely agree. There's there's definitely a if you want to call it a stigma, I guess, with the general population in terms of what property management is, what it stands for and how it's viewed. It's definitely a challenging industry because you're dealing with two things that are incredibly sensitive to people. One is their homes and to which you're usually dealing with somebody's retirement investment like it's a it's an asset that is very, very important for the person on the other side that you're dealing with. So whether if your so that's from a third party
Dave Debeau [00:05:50] to customers you're dealing with. Right. You've got the owners of the building and then you've got the tenants and you've got to try and keep both parties happy.
Tony LeBlanc [00:05:57] And they usually both want different things. That's the challenging part. So to be able to balance and keeping these two happy, sometimes it's not easy. Oftentimes it all works out. In the end, however, they are usually one wants this and the other one wants the opposite or one wants higher rents, wants, wants, does not want to rent. So you got to kind of manage that stuff with regards to the partner away in terms of, let's say, an owner that has investment realty or investment properties and they manage it themselves. There's whether if they manage it themselves or they're working with third property manager, there is a lot of ways in the way that I look at property management is a it's a platform. So you manage these properties and you have access to a lot of different ways to provide service to your clients, whether if that's your investors or that's your tennis, you have a lot of different ways in both sides. So if you're an individual that has acquired some real estate over time in Europe and you're managing these yourselves, then my recommendation is to not just look at the rents in terms of the income that's being generated from your assets, but also look at other possibilities to where some new income and some new things that can be created. Also, you can also look at different ways to save money, whether if it's doing a lot of stuff yourself or stepping out, that's where it gets a little bit different versus third party property management.
Dave Debeau [00:07:26] OK, so let's let's take a look at that. Show us a picture of what a typical property management outfit looks like and then show us what you've done differently and the door opener and what kind of impact that's had on you and your your businesses.
Tony LeBlanc [00:07:43] Yeah. So a typical management company is going to be, I would say, a couple of hundred units under management. It's like a typical size. It's even rarer to see somebody managing over five hundred units. They manage the properties, they'll manage the accounting, which is very typical in every management company, and they're going to handle the leasing component. That's usually what you get for most management companies. And oftentimes that can be a great service and they'll step out the rest. So something that's very close to us is maintenance. Oftentimes the landscaping environment, the snow removal and all the the kind of side things that need to be done within the management company. There's a lot of people that either don't have the expertize or maybe not even the desire to go in and to to take care of the stuff that's easier for them to just sub it out and work with all these contractors. Right. Then you have other management companies where they're also salespeople. So they're realtors, they're licensed not every province in Canada and as well in the States, I believe you don't necessarily need a license to do property management here in New Brunswick. You don't. I know some places out West, you do need a real estate license, but here we don't. So you'll see some property managers get their license so they can buy and sell real estate for their investors. A great thing to do to help with your bottom line. Right. Then there's the third level, which is I call the door opener model to where you have a property management company with a large book of assets. Basically, once you control these assets, you then get presented with a lot of options and a lot of different opportunities. And if you grow it to a substantial size, a lot of new things starts to pop up opportunities. And again, in your maintenance divisions, whether if you want to get into a side business of landscaping, snow removal, plumbing, electrical, you name it, you can essentially look at it. The way that we did it was five or six years ago. We we grew the company from zero units to about a thousand doors and less than a couple of years. And then we got looking at it, we're like, what else can we do here? Are we are we leaving any money on the table? Are we giving the best service possible to our owners and our tenants by having all these outside tradespeople come in and do this work? Do we have good control of it? And unfortunately, a lot of answers were no. So that's when we spun off our first division, which was landscaping and snow removal. And we started off with our own portfolio, kind of cut our teeth in that world, perfected it, and then the ultimate strategy and the entrepreneur model is to then open that up to the general public. So now I am running a real full fledged business that happens to service my portfolio that I control, but also does general public work. And I shared with you earlier for us, that is just completely changed our world because after three or four years, the size of that company is now eclipsed the size of our management company.
Dave Debeau [00:10:41] And that that is so, so cool, Tony, because I don't have very much experience myself with property management that that's one of those things. But I know a couple of several actually property management people. And the business is pretty slim. The margins are pretty slim for a typical property management company. I mean, correct me if I'm wrong, but depending on the size of the of the properties know you're looking at four to eight percent range of groza events is kind of what a typical property management fees are, maybe 10 percent if they're managing single family homes. But that just multiplies the pain in the ass factor of that. So it's pretty skinny, especially when you take into account your overhead paying for your employees or insurance, all all the stuff that goes along with that.
Tony LeBlanc [00:11:33] Yes, sir.
Dave Debeau [00:11:35] So, yeah. So adding on a whole new division and then starting off with your own pool of of clients, you've got a built in demand right there and then spreading out from there seems really hard. But there must have been a lot of learning curve for this thing. It's a whole new business.
Tony LeBlanc [00:11:57] Yeah. That's another hour long podcast. Yeah. Yeah, that's it was the first year was a lot of pain, a lot of figuring out. We made some good moves and made some great moves and we made some poor moves. So, yes, there's there's definitely a learning curve. You're basically you're starting a completely new business that you have to learn the ins and outs on an employee. Oh, absolutely.
Dave Debeau [00:12:19] And all that stuff. Right?
Tony LeBlanc [00:12:21] Yes. Yes.
Dave Debeau [00:12:22] So how long did it take you to get your so you're out of your managing about a thousand doors. That's when you decided to get to do the in-house landscaping business. You started with your thousand doors that you were already managing. How long did it take to grow that business to where it matched your property management business or even surpassed
Tony LeBlanc [00:12:43] it by three years? Wow, that's fast. Yeah, yeah. And the first year was very it was a slow because it was really just us. And probably the first year and a half was just our own properties we had to be able to perfect before we went off to the public. A lot of grass and my friend, yes, we in shifts and plowing a lot of driveways, a
Dave Debeau [00:13:03] lot of snow. But you got to do all that. OK, cool. So then so you started with the landscaping just to give people an idea of what are some other business opportunities that you could look at. And so
Tony LeBlanc [00:13:15] businesses. So I mentioned real estate sales, so I was not licensed till about two years ago. So I started the management company for the first eight years. I wasn't licensed. I originally came into this thinking that it would be a conflict of interest. And I'm eternally grateful that I made that decision because it allowed me to build the management company to where it is today. And it's allowed me to now where I have my license. I've got so many preexisting relationships with so many different investors that literally buying and selling buildings have been basically a phone call.
Dave Debeau [00:13:49] It's Invalides. That just makes sense. Doesn't because you've got all these owners that either want to buy more stuff for their portfolio or they want to sell off their portfolio. Better to go to than do you. Right. Plus, I'm sure a lot of these can be pocket listings because you already know who the buyer ideally probably would be, right?
Tony LeBlanc [00:14:11] Yeah, it's very rare that I end up being on MLS. It's again, it's usually it's it's a private email, a few people and it's sold.
Dave Debeau [00:14:18] So are you even looking for listings or real estate customers out of your pool are even bothering much? That part of the deal is it's just a bonus thing now.
Tony LeBlanc [00:14:31] It's mostly internal. And plus, I get a lot of people from DC, from Toronto that are inquiring. They're looking for stuff. And I'm completely biased. And I'm going to say this. Who better to talk to than a property manager to get the skinny on what's going on in the local market? And if
Dave Debeau [00:14:48] I wear one stop shop, I wear
Tony LeBlanc [00:14:51] my PM hat first in terms of being able to provide people with the details of a property. And then if there's a sale to be had, if they're looking to buy something, then we go into that discussion and a very natural.
Dave Debeau [00:15:01] So nice. All right. So we've got landscaping. Then you brought on the real estate sales.
Tony LeBlanc [00:15:08] So then we got into maintenance. We've had that that one was kind of in there since day one. So maintenance is probably one of the biggest components of the business. Commercial cleaning is a new division we started last year. So we do a lot of new construction people that are building apartment buildings. Once they're done, we send in a team to get it all cleaned up. So we do that anyway. So it's it's a perfect match. Appliance repair, plumbing, another one that we're looking at. Electrical has been we don't have that many requirements. Plumbing, one hundred percent, appliance repair one hundred percent. We haven't dived into the mortgage component. We're looking to stay more within ten of the services that directly have to do with property. So we've also looked at roofing. It's more of a seasonal type thing, but we're kind of being a little bit more picky in terms of where we want to go.
Dave Debeau [00:15:59] So right now, how many different what would you call them? Divisions do you have right now going?
Tony LeBlanc [00:16:05] So we have seven divisions across three provinces. So, yeah, it's fun, really.
Dave Debeau [00:16:11] It keeps us busy enough. That is fantastic. OK, my friend, a time flies when we're having fun, so we'll have to definitely have another little visit with you in a few months and cover the stuff we didn't cover today. But for those folks that they got that curiosity piqued. Well, first of all, let me ask a question. At what point do you think it makes sense to start doing this? As a property manager and so a lot of people listening to this, they might have two or three doors of their own that they're self managing, this might seem like it just. Yeah, OK, that that'll work good for Tony because he has a thousand doors. If you were in that position, how would you look at this whole strategy?
Tony LeBlanc [00:16:56] It's got to be scale. There's got to be scale involved. So I think somewhere is probably around the three hundred to five hundred unit door count. It starts to make sense because without getting that type of traction, you've got to get enough experience under your belt on the management side. And the whole foundation of this is the management company. So your your management experience has to be second to none for your owners and for your tenants. So you've got to get that right first. Once you have the confidence level that you can now start branching out into other opportunities, then you can do so. But in terms of a specific door county, you actually want to start something else. I'm thinking my head is around the three to five hundred dollars. Probably a good spot.
Dave Debeau [00:17:40] I would think so, because by the time you're that big, you've got that many properties you can you know, you've got staff helping you. Exactly. The management of the property management. That's when you focus your attention on.
Tony LeBlanc [00:17:54] Yeah. And the biggest beauty about this is the whole thing is why it's easy for us to spin off these companies because we have the infrastructure. Yeah, you can only get that infrastructure once you're a certain size. So we have a full time on staff. I've got all my maintenance guys, my cleaning staff, my property managers, my resident managers. I have the team so I can use them for the different things that I want to be able to
Dave Debeau [00:18:18] do because it's so much more efficient, because you can have multiple businesses under one roof to see their efficiencies of scales with bookkeeping and accounting and reception and all that kind of stuff, I'm sure. Yeah, makes sense, Tony. Awesome stuff. People want to find out more about Tony Liveblog and your book. What should they do.
Tony LeBlanc [00:18:36] Door dot dotcom,
Dave Debeau [00:18:37] your partner dot com. Love that title. Did you URL as well, my friend. Thank you so much for being on the interview. It's been a lot of fun.
Tony LeBlanc [00:18:45] Thanks. Appreciate it.
Dave Debeau [00:18:46] All right, everybody, take care. Check out Tony's book and we will talk to you on the next episode of. Well, thanks very much for checking out the property profits
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