Table of Contents - Buying Rockefeller with Agostino Pintus
Dave Debeau [00:00:09] Everyone, Dave Debeau here with another episode of the Property Profits Real Estate podcast, we got a guest coming back for a second round, our good friend Agostino Pintus. How are you doing today, my friend?
Agostino Pintus [00:00:22] Man, I'm charged up. I'm awesome. How are you doing, my friend?
Dave Debeau [00:00:26] I'm doing very, very well. So Augoustinos is kind of a world traveler, world presider beaning, lived in Canada for a long time now, resides in lovely Ohio and that's where he focuses his investing is a multifamily investor, is also getting into development deals. He's got a very interesting, very exciting development project on the go. And we're going to touch today a little on triple net leases because we've all heard of that, but not everybody understands exactly what that means. So, Agostino, tell us a little bit about transitioning from buying multifamily properties into getting into development deals.
Agostino Pintus [00:01:08] Absolutely. Absolutely. Well, you know, I think for for many of your listeners, they're probably doing single family multifamily, like the same thing I did in the same I'm still doing I'm still doing those deals today. I'll tell you, though, that one thing that I realized is that it's a great starting point. And I think that for many of the people I follow on Facebook might listen to another podcast they they're doing in a big way and they're very, very successful. And I'm not mad at doing syndications or multifamily by any stretch. I still love that business, but that is just the beginning. There is so much more aside from doing multifamily syndications. And another big aspect, and I consider this like the next level stuff, next level stuff is doing development. So in our case, it's trying to find buildings that need a lot of help. And maybe it's a historical redevelopment, maybe there's something of that element there and we take it and we do a conversion from office, for instance, to multifamily, that's one of the deals that we're doing right now in downtown Cleveland. That's what we're going to be kicking off here soon. It's just that now what you're going to find with these development type projects is that they are far more lucrative, a little more risky. And I kind of I mean, it's not it's not like a slam dunk, so to speak, with a multifamily deal that's probably underwritten and performing. But with development, there's always it's a different level of risk. But with the right team, with the right people at your side, you can mitigate that risk. Right. And when I say team, it's not just your you and your partner, but it's also the people that are putting the deal together. You're financing your your contractors, your maybe you have a developer assistance that really knows the ins and outs of locating the deals, working with the sellers, but then also post acquisition, getting the marketing out there so you can you can share with the world how how you done with the asset and what you've done and get it get at least up. It's a whole different set up. It's a whole different thing, but to me, far more exciting. I love that stuff just
Dave Debeau [00:03:19] for quick secure. So what would be the difference between a development deal and a redevelopment deal? And because it almost sounds to me and I could be completely mistaken, I often hear it almost sounds like what you're doing, taking a an office building and transforming it into an apartment building. You've already got the structure existing. You're not probably tearing the whole thing down. You're just kind of redeveloping it. So, yes. On what?
Agostino Pintus [00:03:49] But that is. Yeah, exactly. And that's exactly what it is. You know what? We're taking this this asset, we're redeveloping it and repositioning it into multifamily. So, for instance, the Rockefeller building in downtown Cleveland. Now, Dave, this was John D. Rockefeller. Hang out. This is where he worked every single day. He just rebuilt. His empire is at this property.
Dave Debeau [00:04:11] It's amazing. So when was it first built?
Agostino Pintus [00:04:14] It was built in nineteen. It was completed in nineteen eighty four. So it's over one hundred years old.
Dave Debeau [00:04:20] And this. And how many stories is it.
Agostino Pintus [00:04:23] It is seventeen stories.
Dave Debeau [00:04:25] So back in nineteen 04 that was a skyscraper by any stretch of the imagination.
Agostino Pintus [00:04:31] Exactly. Exactly. It was a skyscraper. And I'll tell you what. And the very top floor. Right. Instead of having offices overlooking the city there are thirty seven safes. Thirty seven walk-in safes. These rooms are enormous. Right. I imagine this is where Rockefeller kept all of his money. I'm not really sure.
Dave Debeau [00:04:52] But so then if you're not familiar with Rockefeller was you've heard the name. He was the I believe he was the wealthiest man in the world for a while, if not way up there. I'm pretty sure he was the richest.
Agostino Pintus [00:05:06] He is. He was he was there. Just man on the planet. Yeah, yeah. Yeah, that's right. That's right.
Dave Debeau [00:05:11] And so that's the one here. That's the one you're working on. All right. So you've got a you've got a building that's one hundred and fifteen, sixteen years old. Seventeen stories since John D moved out with God knows how many years ago. I was fifty six years ago probably at least
Agostino Pintus [00:05:32] you could say that it's more than that. Yeah. I mean he spent some time in Ohio and then eventually moved to New York, where of course you have that the Rockefeller Center down there in New York City. But for the longest time, this was his home. I mean, this this this building has a very, very rich history. Where it fell out of the Rockefeller family was sold off and eventually the Rockefeller got upset with it, with the owners. At that time, they bought the building back. They put their name back on there and put it into the deed that the building can have its name changed so forever. As long as that building is standing there, it's going to be called the Rockefeller building,
Dave Debeau [00:06:06] which I mean, that's that name is gold. So, I mean, I wouldn't want to change his name for sure.
Agostino Pintus [00:06:10] Right. Who would want to change that ridiculous right now?
Dave Debeau [00:06:13] What's it been for the last God knows how many years? What's it been used as?
Agostino Pintus [00:06:17] It's been an office. It's been. And so I think part of it, you know, Dave, is that downtown Cleveland has I'd say, I don't know, it's over at least at least five or six years. The past five or six years has been going through a resurgence. Right. A lot of money has been coming back into the city, mainly by Cleveland Clinic. There's a lot of food and beverage companies that are down there, the relocated down there. Sean Williams was moving their headquarters there. So all this money is coming into the city and there's a big revitalization that's taking place. But prior to that, I mean, there's nothing going on down there, like nothing. It was terrible. You wouldn't want to be down there. And so the current owners, they bought this property a very. A long time ago, 50, 60 years ago, they bought this property and they just sat on it and they leased out by the CEO, primarily his office, but it's only 50 percent occupied. So but, you know, if you can imagine what a rich, rich history that this place has, it's just it's amazing, just amazing property.
Dave Debeau [00:07:22] It's early, kind of early on. But what is your vision for this property? Because I've got it. I've got an image in my head of a 17 storey 100 and some year old office building. What are you going to be transforming that into? I would imagine that you're going to keep the exterior fairly classic, but you're going to be completely revamping the the inside. What does that look like in your mind's eye?
Agostino Pintus [00:07:48] Yeah, sure. Well, you know, the exterior has to remain the same. And I'll tell you why. There's we have we're wearing some some federal tax credits. We're also getting some we're getting what's called a pace loan. We're getting other loans from the state to help offset the costs of the buildout. And whenever you do that, whenever we get these historical tax credits and things of that nature, you have to maintain the historical integrity of the building right. Even down to the windows. You can't just up and change the windows. And if you do change the windows, it has to match in terms of the color scheme and everything else like that. That was that was there previously. So for the most part, the exterior is going to be cleaned up. It's going to look really, really nice. And it looks like it was the day it was built. Basically, as far as exterior is concerned, the interior is where the big changes are going to take place. Where we are, we're going to have the lowest level is going to be primarily the first floor, rather, is going to be restaurants, food, that kind of thing. Then we're going to have the next three floors. They're going to be office and then the remainder is going to be four hundred and thirty plus apartments. That's how big this place is. This place over three hundred thousand square feet. How much is it. Over three hundred thousand square feet. Wow.
Dave Debeau [00:09:02] Wow. So it's not 17 stories, but it sounds like it's pretty. It occupies a fair sized footprint.
Agostino Pintus [00:09:10] Exactly. Exactly. Yeah. It's shaped like a giant E.. Right. So it lends very, very well to to that makeup of units, basically ones, twos and some studios. Now, the reason why we set it up this way is because literally across the street, Sherwin-Williams is moving their headquarters right across the street from the asset. There is currently a parking lot. They've already bought the parking lot. They're converting it to a giant, a giant headquarters. Basically, it's going to six thousand people in its headquarters.
Dave Debeau [00:09:43] Wow, that's good. Yeah. Yeah, that's me. Speaking of parking lots, this building was built when it was still horse and buggies for crying out loud. So, yeah. What what is parking going to look like in this? What are the options for parking?
Agostino Pintus [00:10:01] Well, I'll tell you what, there's actually two surface slots that come with the asset, OK? And then there's also a garage on the property as well in the garage. It's also on the historical registry at the National Historical Registry. The garage itself is that's it's very, very old. It's not really safe. It's quite small by today's standards, but it's still a structure and it's still there. It's on the historical register, as I said. So you can't just go ahead and tear something down. And it's on the historical registry. Right. So we have to take some some special precautions as to how we're going to handle that. We're not entirely sure how we're going to handle it just yet, but something is going to get done with it just because it's not really safe. And we have to just figure out what to do with it. But you're absolutely right. I mean, when you look at this garage back when it was built, I mean, it was a big rush by today's standards. It's tiny, it's tiny, you know, so but fortunately, we're going to have this we're going to big lots as part of the asset and it's going to drive some really good income for the property as a whole. So it's just going to be remarkable. It's going to be remarkable.
Dave Debeau [00:11:05] So that's exciting stuff, Augustino. So so the bottom floors are going to be kind of retail, restaurant, that kind of thing, or at the bottom floor level, next three floors. The next few levels are going to be office areas as well. And then the top the rest of it's going to be all for, as you say, four hundred over four hundred apartments.
Agostino Pintus [00:11:27] Over 400 apartments. Yeah. Yeah.
Dave Debeau [00:11:29] So I mean, what is the anticipated time frame for getting this property turned around and then what's what's your long term plan for?
Agostino Pintus [00:11:39] You know, it's going to be it's going to be a twenty four month build. I mean, it's going to take a little bit to do it. But fortunately, the contractors we partnered with, they do this kind of stuff. They do they specialize in historical restorations and build outs. So for them, it's old hat. They're going to get it done that I'm not worried about. That's the last thing I'm worried about, you know, but. Long term, I would love to hand this off to my to my son at some point, I dunno if it's feasible, but it'd be nice to do that. But for me, this is like it's like a trophy asset, you know? And I think for for many of your listeners out there that maybe they're, you know, maybe they have a thousand units, twenty minutes or even more. It's at that point that usually some of these people start thinking, you know, I want to take down an elephant. I want to go after something really, really big, you know, and and I've been very, very fortunate that this deal I was able to line it up very, very pleased with how it's going so far. And I can't wait to really kick off the actual development side of things. It's going to be amazing, amazing stuff of it. But you know what, though, Dave? I'll tell you, I think to me it becomes the natural progression is you do some of this, some of the multifamily stuff, and then you start building wanted to build your own. I found that for many of the more successful guys out there, that's what they're doing. I mean, there's exceptions that Grant Cardone, for instance, he doesn't do any of that stuff. He only buys a class assets. He's playing a very different game. And, of course, the big hedge fund people, you know, they don't really do that stuff. But I'm saying some of the some of the the people here, even here locally, they might have ten thousand units, but a large portion of that that either redeveloped or they there's some ground up development. But development is certainly a key aspect, it seems, for many of these people that get into multifamily. And after doing it for a while, it's kind of like a next level, right?
Dave Debeau [00:13:41] Yeah, I know that makes sense, Agostino. Time flies when we're having fun. We were going to talk a little bit about triple net leases and all that kind of stuff, but we are going to have time for that on this interview. But, you know, I'm sure you're piqued the curiosity of a lot of our listeners. If people want to find out more about you and and perhaps reach out to you, I believe you offer some some training and coaching and that sort of stuff as well around multifamily investing.
Agostino Pintus [00:14:06] That's right. That's right.
Dave Debeau [00:14:08] Tell us a little bit about that and how people can reach out to you.
Agostino Pintus [00:14:10] Yeah, you know, I mean, we have we do coaching on multifamily. And to me, I tried to I was I was trying to do things as comprehensive as I possibly can. That's just how I do things. And I was put out good stuff. At least I like to think so. Anyway, so we have an online course that we do and as I said, very comprehensive. You go through that, you can pretty much be ready for just about anything. Then we all still alive. A lot, of course, as well. One on one even is available to. So but if anybody wants to reach our bulletproof cash flow, dotcom is the best way to go. That's on the website. You can also hit me up on Facebook, hit me up on on Instagram. Dmae, I love hearing from people and I always get back to you. So it's just one of those things I love hearing from people.
Dave Debeau [00:14:55] Some while my friend. Congratulations on this jewel in your crown. I am super excited for you. I can't wait to see how this turns out. So we'll definitely have to interview you with some visuals before, during and after type pictures of this whole process, because I just can't wait to see how it turns out.
Agostino Pintus [00:15:16] I can't wait for it. I can't wait to see it either.
Dave Debeau [00:15:20] Step possible. Thank you very much. I always appreciate it. All right. Thank you. All the best with your ventures.
Agostino Pintus [00:15:26] Awesome. Thank you. Thank you,
Dave Debeau [00:15:28] everybody. That's it for this episode. Stay tuned for the next one. Take care. Bye bye. Well, hey there. Thanks for tuning into the Property Profits podcast. If you like this episode, that's great. Please go ahead and subscribe on iTunes. Give us a good review. That would be awesome. I appreciate that. And if you're looking to attract investors and raise capital for your deals, that may invite you to get a complimentary copy of my newest book right back there. There it is, the money partner formula. You got a PDF version at Investor Attraction book, dot com again, investor attraction book, dot com ticker.