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Podcast Transcription

Sandy Mackay [00:00:31] Breakthrough Real Estate Investing Podcast Episode 52.

Rob Break [00:00:48] Now. Hello and welcome to the Breakthrough Real Estate Investing podcast. We put the show together to inspire you and help you break through to the life that you want to live through the power of real estate investing. My name is Rob Brake and here with me again, as usual, Mr. Sandy Mackay.

Sandy Mackay [00:01:17] Hey, Rob, how are you doing today? Very good. How are you? I’m awesome. Excited to be here again and excited to have another amazing guest. This is going to be a great show.

Rob Break [00:01:28] I am very excited as well. We have Derek Peever from Peever Khan Group of companies and he’s going to talk to us about all kinds of different things. I don’t even know where to start with this one, so we’ll wait until he gets on here to explain what he does. But super interesting and I can’t wait to get going. So thanks for coming on, Derek.

Derek Peever [00:01:48] Thank you very much for having me, guys excited to be here.

Rob Break [00:01:51] First thing’s first, we’re going to encourage everyone to go over to break through Aria Podcast dossier. Slowly but surely, we’re just making little changes to this, and hopefully it’ll be a very good resource for all of you to get in contact with our previous guests and also maybe touch on some other education and whatnot about real estate investing. So we encourage you to go over there.

Sandy Mackay [00:02:18] Yeah and sign up for our list to get their free giveaway. There are seven free democracy you can trigger in your property starting right now to free download. You can grab it any time. It’s just going to help you manage your properties better, create more freedom in your life and just be a better investor in real estate overall and as well. On top of that, always want to encourage people to jump on to iTunes and leave us a great review. Five-star review if you don’t mind. And we’ve got a bunch of them on there, but the more we get, the better we are able to bring great guests on. It just makes the show reachable to more people and stores up better in the searches there. And really, that that sums us up and inspires us to bring on some more great guests and do great shows and keep this thing running.

Rob Break [00:02:59] You know, what I love seeing is people are actually going on and putting on the reviews every month. We’ve got new ones. So again, I’m going to read a few to us, and we actually had an explosion of five-star reviews within the last like since we did the last show. So I won’t read them all, I don’t think. But we’ve now got eighty-five-star reviews and an 86 ratings overall, and the lowest one is the three star. So that was probably back when we had more technical difficulties and whatnot with the show, hopefully. But, but people, the most recent ones are all five stars, so thanks everyone. The first one is from R M 10, he or she says, keep up the amazing work. Five stars I chanced upon this podcast last summer and I’ve been a huge fan ever since. Love the great mix of theoretical i.e., various investing strategies, et cetera, and practical discussions i.e. avoiding common pitfalls, motivational sessions, etc. The most important thing I’ve gained was the courage to do my first deal. It’s also been inspiring to hear the journeys of all your many guests. I continue to recommend this show to all of my friends. That is a good one. Thank you. The next one is from Wren’s ebe, and it is five stars as well as great content. I am brand new to RBI and this is a great source of information really like the one on incorporating your RBI business. Thinks I’m interested in learning about rent owns, if possible, five stars. Good. Yeah, you know, a lot of people are interested in rentals. I don’t think we’ve done a rent to own.

Sandy Mackay [00:04:45] We have. It’s been a while.

Rob Break [00:04:46] Did we do one?

Sandy Mackay [00:04:48] No. Gary Hébert on Us.

Rob Break [00:04:50] Oh, that’s right. Yeah, I’m sorry. That was a man I was so long ago.

Sandy Mackay [00:04:54] I was like, Yeah, yeah, yeah.

Rob Break [00:04:57] Gary Herbert. Great.

Sandy Mackay [00:04:58] She does rent on that specifically. They really go into it deeply.

Rob Break [00:05:03] Yeah. Gary Hebert was a great guest, actually, and I still am in contact with Gary quite a bit. So anyone who hasn’t heard that it was one of our very first interviews, so I think it was six foot six. Yeah, go back and listen to that. He was full of information there. The learning curve accelerator’s. That is our new. We have been dubbed the Learn the learning curve accelerators by Mr. Insurance Guy. My wife and I recently started getting educated around real estate investing, and I came across this podcast about a month ago and we can’t get enough. The content is extremely helpful and relevant to the Canadian and mainly Ontario market, and the questions you guys ask to evoke real dialog with each of the guests. It’s amazing how you books, and podcasts are available in audio format when it comes to Canadian real estate investing. But you guys do a great job at educating your listeners while keeping it entertaining. We also enjoyed the wide range of topics. This one is actually really long. The wide range of topics. I’ll leave it at that. Thanks, Robyn Sandy. And there’s, I don’t know. One two three four five more, probably that I haven’t read, but maybe we’ll get to those next time. Six seven. There’s seven more, actually, that I haven’t read yet. So thank you so much. We really appreciate everyone’s feedback. And you know what, if you if you’ve got something a little critical to say or if there’s a topic especially that you want to hear from us, we should do another rent own one soon. Next month, I believe we’ve got one of the contractors that I work very closely with here, and he does. He’s done like 20 plus basement conversions, so that’s going to be really interesting as well. But if anyone has recommendations, please feel free to let us know and we will hopefully get to all of these other emails at another time.

Sandy Mackay [00:06:55] And the other thing too, I want to thank everyone has done a few events over the last month or two, and I’ve had some really great turnouts. Anyone who showed up to those events really grateful to have you out, and I know I hope everyone took a lot away from them. We’re going to continue doing some events here and there throughout the year. I think we’re going to probably ramp it up a little bit more as we get going. Rob, right?

Rob Break [00:07:14] Yeah, that was fun, Sandy. I actually got to come down to Hamilton and hang out with you guys for a day. A couple of weeks ago and which is something that I haven’t done, you know, both of us are just so busy. And Sandy, you were out to one of our tours a little while ago, so it was fun just crossing over again and hanging out together. The one thing I’m a little disappointed in, though, is I heard last weekend that you took a bunch of people out to actually tour some of the properties that you were working on. So I was a little bit disappointed. I didn’t get to come down and see those some interesting things you’ve got going on.

Sandy Mackay [00:07:44] Yeah, it was great. We went on. So we did the buy fix refinance kind of strategy tour. So we saw before our version and a fully done version just about to be rented. And we looked at one on the market that was available to do the same sort of project. And so it was cool. And I really, if someone if you’re not on our email lists, I mean, not all of these events get talked about on the show. So I really encourage you to jump on already molest if you can’t find it on our website or for some reason, you’re having trouble getting on our list, just shoot us an email info, a breakthrough our podcast and just say you want to be on our email list. That way, you won’t miss out on any of these events that we’re hosting.

Rob Break [00:08:21] Yeah, you know what? That’s our fault, though. We really didn’t push what we were doing until just recently, and we I don’t really know why we didn’t. I guess it was more just an oversight rather than any other real reason. But yeah, it’s good. I think at the end as well, we’re going to mention some stuff that we have coming up. So stay tuned till the end. Don’t turn it off before that, OK? Um, so I think that’s about all we have to say before the interview. Can you think of anything else?

Sandy Mackay [00:08:49] No, we got Derek waiting here and say, Let’s get into it. Sounds good. Derek is a visionary entrepreneur with a clear picture in his mind of what the future holds for his Pivot Khan group of companies. Derek has an incredible appetite for knowledge in the field of self-improvement, leadership, and management real estate business, and has adopted a lifelong learning attitude. Over a hundred real estate transactions under his belt since 2006 and five active businesses. Derek continues to oversee strong returns being generated for investors and is effectively managing the assets of his valued group of friends and family. Derek’s Platinum Reign member, which means that 50 plus properties purchased as a member, it is probably getting over 100 there and being a diamond member this spring, as one ran top of world’s top players award in 2012 13, 14 and 15 and the Ranger I mentioned Partner of the Year for B.C. for 2013 and 14 is also the 2015 Raine Joint Venture Partner of the Year award winner for B.C. And I think there’s a lot more of them at home. Maybe leave it at that. He’s an award-winning investor.

Rob Break [00:09:54] That’s impressive enough. All right, you’re putting the rest of us to shame. So yeah, that isn’t even all of them, though, which is amazing. So congratulations on all of that, Derek. That’s very impressive.

Derek Peever [00:10:09] Hey, thanks a lot, guys. Really appreciate the amazing introduction. Thrilled to be here. This is how I got my start, as well as its books, seminars, you know, YouTube university. So love what you guys are doing. Check Total almost all of your podcasts and a big binge week there, so I’m thrilled to be here.

Sandy Mackay [00:10:29] I’ll say our excited to have you. So this gives off. Are you? Where are you? Tell us a little bit about how you got started in real estate investing and why you chose real estate.

Derek Peever [00:10:37] Absolutely. So 2005 is when I say my light bulb got turned on, and it was this kind of in a chance ride that I took with my friend who was picking up his boss from the airport Vancouver Airport and him. Is actually renovating homes for this lady, a wonderful lady named Kelly Fry. She’s a top realtor in Park Whitlam now. A lot of people in the real estate community know her, but the whole way from the airport back to Pitt Meadows, she was just telling us about her properties abroad and a book called Rich Dad, Poor Dad, as I’m sure you guys are familiar with and heard of the very next day, I went down and bought it and just had that paradigm shift right where I changed my whole kind of life’s plan from, you know, buying a nice principal residence, a Harley, a boat, all the doodads. And I reversed my whole plan to taking what savings. I had my line to credit and going out and buying the investment properties that would later on afford those things for me. So basically what we did was we started learning. I read the series of books. We started our hunt for cash flow properties. And that took us out to a little tiny town. At the end of the free Fraser Valley called Agassi, and in March 2006, myself, my business partner, my best friend Carson Cohen, and my dad and his dad went four ways on a condo for $65000. So we put down that was a two bedroom, by the way. We put down $5000 each. We were all in renovations, and Carson and I basically would do the work, you know, renovating it with a brushed nickel conversion and the sports and paint and the basic Reno, we put up equal amount of money as our dads. We qualified for the mortgage. So right from our first property, it was a joint venture and then somebody knocked on our door during the renovation and said, hey, on the second floor, we’ve got one for you for 50000 for a one bedroom. So we couldn’t resist. We moved our tools up there, renovated that same thing, happened knocked on the door, third floor fifty-two thousand. So we just kind of got on a roll right out of the gates and you know that we thought we had to go that far to find positive cash flow because when you’re new, you don’t really see the opportunities, right?

Rob Break [00:13:02] Yeah. Well, at 50000, I’m guessing you couldn’t really go wrong.

Derek Peever [00:13:06] Yeah, no. When we first bought them, they’re renting for, you know, $400, $500. And just over the course of three years, we got those rents up probably to 750, 850, that kind of thing. So it was a good little repositioning project on a small scale.

Rob Break [00:13:23] So now what did you do? You hang, you hung on to those,

Derek Peever [00:13:26] you know, those are some of the few properties that we ever sold because at the time I lived in Surrey and had a full-time job and I was getting really tired of driving a taxi, which is probably a good hour commute to deal with what I call The Jerry Springer Show. Because in Agassi, you know, you’re either renting to inmate families or corrections officers. And, you know, we would obviously prefer the latter. But you know, a lot of the time when you’re suffering vacancy for a few months in a small market, you’ll make an exception and then have to learn some hard lessons.

Rob Break [00:14:03] That’s interesting. It’s also you could put one correctional officer in the building and just look after the rest.

Sandy Mackay [00:14:10] You would hope, but I think they want to leave their work at work.

Rob Break [00:14:14] Yeah, I wouldn’t. I don’t think I’d want to be in that situation. OK, cool. So. So that was twenty-six, I guess, in 2007.

Sandy Mackay [00:14:23] Right?

Rob Break [00:14:24] How did it play out from there?

Derek Peever [00:14:25] Yeah. So after the three condos and Agassi, we actually bought a townhouse in Pitt Meadows, B.C., which is somewhere I grew up for period of time, went to high school. And that’s where Carson and his family were from just down the road from their house little townhouse complex. We bought a two-bedroom townhouse for one hundred and sixty-five thousand. And same thing gutted it know did the $15000 kind of renovation with floors, paint countertops, that kind of thing. Got a new, better tenant in there, paying a higher rent at that point. I was out of my own savings, and I was out of my own line of credit because that deal took a bit more capital to do. And you know, from that point on, I had to figure out how to turn it into a business. So right around that time is when I started, you know, really going to the fast track to cash flow seminars, the ringing group, that kind of thing and learned how to add value and have other people put up the money so. Deal number five was a condo in Mission B.C., where we actually had Carson’s and purchase a two-bedroom condo outright on her line of credit for one hundred and fifty thousand. And we did about 12000 worth around and two months later because the market was booming kind of similar to today. We were able to refinance based on $200000. Asal get a 75 percent first mortgage payout, her line of credit, and we were to send to the property for renovation costs, so that was kind of a cool deal and we tried to for sale by owner, which don’t usually recommend these days and we couldn’t get what we wanted. So we just rented it out and we still have it today. And then same thing someone knocked on her door. We bought another one in that building, moved our tools downstairs and just kind of continued from there with friends, family, you know, my mom, I think the deal number eight and so on. You know, my I worked in the marine industry actually for 10 years, so I had a lot of tugboat captains and friends that way that had good income and they were able to qualify for mortgages and put up the money. And I would do the work and basically only make money when they make money. And if they lose money, I lose money.

Rob Break [00:16:43] Mm-Hmm. And that’s the amazing thing about these groups like rain and out here during Hurricane Sandy, your group, so where you are, is like when you first join those groups you don’t really understand that there are actually people that can see what you’ve done now with those four property projects under your belt. And then on the fifth one, you’re able to bring in somebody who, you know, wasn’t a relative. And you know, you didn’t just have to say, come on, you know, give me some money, right? So they were more someone that want, like, trusted in you believed and you looked at your past record of what you’ve done. And they were actually willing to, you know, invest in you. And so these are the things that people just starting out. And I know myself and probably you, sandy were in the same boat when you when you first heard about that. I was I was like, No one’s going to want to give me money, you know? So that’s pretty common for a lot of people to think of. But I mean, maybe not right off the bat, but once you’ve got a little bit of experience under your belt, people give you money. If they can see that you’ve got a proven track record, that’s very important. So I don’t think that that’s not going to happen for you.

Sandy Mackay [00:17:54] Oh yeah. There’s so much money out there,

Rob Break [00:17:57] and Sandy’s got all of it all tied up. OK, so what do you think were some of the bigger challenges that you faced while you were starting out? And how did you manage to overcome them?

Derek Peever [00:18:10] Well, you know, one of the lessons that I think I was fortunate to learn early on was that the properties and they teach a lot of this stuff at, you know, things I was paying attention to. But curb appeal is very important to make a landlord’s life easier. You know, the Agassi condos were very ugly, and you know, we’d get stood up at appointments constantly. I travel all the way out there and nobody would show, even though I talked to them before I left, you know, the tenant profile. Like, in my opinion, there’s just a total spectrum of like a landlord’s experience. And I felt that the low-end property management is just definitely not something I want to deal with. Where you’re stressed out, you know you lose your appetite because you’re dealing with all this drama. Whereas now I’ve turned my business to as high end as possible with the clients that we deal with at rental properties, where often it’s companies paying the bill. And you know, just the price point alone is your main screening agent and regular cleaning service every two weeks, that kind of thing. It’s just a totally different program for your landlord. That’s, I think, a lot more pleasant, no matter what you do like, we own properties right across the spectrum and as long as you like. I’m a big believer in, you know, providing a clean property in good repair and maintaining things and owning properties that you can be proud of, where you’re not kind of ashamed to even let anybody know that you, you own them. And that’s just kind of the route that we’ve gone.

Rob Break [00:19:38] Do you have any other challenges that you were facing when you started out? Yeah.

Derek Peever [00:19:43] Well, one tip is the properties that have done the worst for us over the last 10 years as far as appreciation and just overall rental performance would be the ones where, you know, the curb appeal is poor and you may have an amazing suite because mainly what we’ve done is condos and townhouses, very few detached homes. We own one unit building in Maple Ridge and a couple other things, but mainly condos, townhouses. But the ones that don’t have ensuite laundry and don’t allow pets and curb appeal is not that great. You know, we own some that we’ve had for almost 10 years that are worth 20 percent less than what we paid, and unfortunately, some of those were family deals that we did early on. So, you know, looking back, I wouldn’t do any more of that just, you know, really good curb appeal. You show up. There’s lineups of people, you know, every 15 minutes you get a little frenzy and rented out other challenges would be trying to transition into a full-time investor for me was tough doing unfurnished rentals because even if. Cash flow, $3500 a month, it’s difficult because as you guys know it, that goes right back into the property to appliances or a vacant month here and there where it’s furnished rentals was my out. You know, when they started doing furnished rentals, they could actually afford to pay me a few hundred bucks a month per property and still be budgeting properly for furniture replacement and vacancy and all that kind of stuff. So that was a big challenge trying to get to the full-time real estate investor and then doing furnished rentals. Obviously, in the beginning, you still have a job that’s a tough transition. I used to get changed on the way to work pretty much every day because I’d be doing my real estate stuff and then get there half an hour early, get changed in the car, go to work, you know, wake up, crush the office for a few hours, then go run errands, then too real for real estate projects and then off to work. So it’s not an easy transition, but it is doable.

Rob Break [00:21:50] So as far as the price point and stuff like that goes, do you find that offering furnished rentals you have to replace appliances and furniture less or more? Well, I guess if it’s not furnished, but let’s say, are they taking better care of things because of the price point and the prestige of what you’re offering?

Derek Peever [00:22:11] Absolutely. Like we have fridges that are 10 years old, and we could sell them as new fridges because they are getting a deep clean on a regular basis. You know, the guest knows we’re coming in every two weeks, so they’re generally on pretty good behavior. And you know, just as, you know, if you have a messy tenant, there’s not a whole heck of a lot you can do, you know, give them a free cleaning at Christmas or something. But if you have cleaners going in every two weeks and they’re letting me know if the silicone starting to let go or they think they might be wearing their shoes in the suite or they’re smoking in the suite, then we can deal with those things right away.

Sandy Mackay [00:22:48] So what’s your favorite recent strategy and why? And maybe if you can tie into this, you know why you’ve chosen condos and townhouses as opposed to doing any detached?

Derek Peever [00:22:58] Yeah, OK, so there’s so many. That’s the awesome thing about real estate. But if I had to put a finger on it, it would of course be our bread-and-butter business, which is super sweet. And, you know, second place would probably be what we’re getting into now, which is aging in place. Independent living for seniors, which is very comparable to super sweet and a lot of ways, especially if we do a furnished model for the seniors where they can try the product for 30 days, for example, then decide if they want to take a longer-term suite for a year. But the reason why Super Sweet is my favorite strategy is because we buy the farm for what it yields, not for what it might be worth one day, which is Warren Buffett, right? So even if we buy a property for, let’s say, 300000, which is our cookie cutter deal and there’s zero appreciation over five years like our investors are still going to get a double-digit return or close to it just off of cashflow and mortgage pay down. Mm hmm. So another cool way to put it is you guys might have heard that it’s like the three meals of real estate. Have you heard that one go ahead?

Rob Break [00:24:08] I don’t. I don’t think I have actually.

Derek Peever [00:24:10] OK, well, here’s the cool and for you, I heard this from Thomas buyer, so I better give him credit. Basically, the appetizer on a regular real estate deal is the cash flow the mean meal? The main course is the mortgage pay down and the dessert. If you get any is the appreciation, but with furnished rentals, it’s actually the appetizer is the pay down. The main course is the cash flow. The main profit center is actually the cash flow and then the dessert, if you get any, is appreciation. So it’s that’s probably why I like it the most. And then besides that, the real secret to the whole thing and it’s not that exciting is the cleaning service because we’re paying not only for cleaning and maintaining the property, but also intelligence, right? So that this allows us to give a like an impeccable level of property management where anything is not working rate or even light bulbs, road, and stuff like that. Like, we’re on top of it. It’s a constant fight for that show. Sweet.

Rob Break [00:25:15] Yeah. Well, I think that’s actually a very interesting part of it as having the cleaning service. I would love that if I was renting a place and there was a cleaner that came in every two weeks and clean up after me, that’d be fantastic. Absolutely. OK, so with the seniors places, I actually want to ask you another question about that. So in what ways are you catering to them? Is there onsite assistance for them? Or is it just more that you’ve made it like accessible in that kind of thing?

Derek Peever [00:25:42] Yeah. So I’ll tell you guys about a project that we’ve got under construction in Abbotsford. It was actually long delayed, so I’ve done a lot of research and a lot of. Preparation for it. It was pretty ambitious, it’s a 26-story high rise in Abbotsford, which only has 120000 people. It’s the tallest building in B.C. outside of Metro Vancouver. Wow. That’s right. Right now, the tallest building in Abbotsford is only 16 storeys built, probably 15 20 years ago. So it’s pretty substantial. It’s right on Mill Lake, which is kind of like what Stanley Park is to Vancouver, for Abbotsford, right beside the hospital, etc. But what we’ve done is have a tight relationship with the developer quantum properties, and it’s a building that has three stories of commercial in the bottom. And then what we’ve done is we’ve bought, well, an investor group that I’m involved with has bought a block of 46 units. So the lower floors. And that’s what we’re going to run the seniors independent living in. And then above that is actually owner occupiers, but a seniors demographic as well. Oh, OK. So we’re calling it mahogany platinum for these suites that have the escalated level of service. And what we offer them is first the best real estate in Abbotsford with unobstructed mountain views of and also of the lake. It’s a noncombustible building. There’s a resort style amenities on site that the developers are putting in. We’ve also got our own kind of IP aging in place room where our concierge is on the main lobby floor and that has an adjoining door to the Big Feast Bistro, which is the restaurant for the building. And they do organic like local. He’s on Canadian national cooking shows all kinds of cool stuff. He has a really successful business in Maple Ridge and he’s going to be expanding out to Abbotsford. So the other things that we have is we have some aging in place renovations, which are a lot of the simple things that help people stay at home longer and aging in place technologies. So if somebody has a significant medical event, you know, we can enable things like fall detector, flood detector. You know, if the smoke detector goes off, it’ll call the concierge stove guard, those kind of things. So that’s basically the simple recipe on what they’re getting. There’s a ton of other benefits like, you know, access to the milk boardwalk, complimentary commercial with doctors and pharmacy on site. But really, we are just a regular landlord operating under the Residential Tenancy Act, and we’re targeting seniors. So there’s no licenses or anything required as far as you know, doing meals and meds for assisted living. But we hope to maybe grow into that one day.

Rob Break [00:28:35] Well, it sounds like a very cool, very interesting project that you’re getting into here. So at the end, we’re going to talk about how people can get in touch with you and learn more about that, too. Awesome.

Sandy Mackay [00:28:46] Mm-Hmm. Well, and what about the Super SuperSpeed strategy and model? Can you tell us a little bit more about that?

Derek Peever [00:28:52] Absolutely. So basically, what we do at Super Suites is we’ll put together groups of buyers and we’ll go out and we’ll buy, you know, usually minimum for condos at a time and we buy them brand new. And there’s a bunch of reasons for that. But a main one is that we always want to be grandfathered as an original owner when there’s condo board brings in, for example, one-year minimum lease terms. So we carefully read the developer’s disclosure statement make sure that we can do what we want to do, which is, you know, 30 days. Our average day is about 68 nights, which is a lot different than Airbnb’s average stay of six point eight nights. Mm-Hmm. You know, it’s corporate housing by owner. It’s, you know, we’re members of the Corporate Housing Providers Association. It’s an industry that’s been around a long time, but just kind of is really coming to the forefront now with the whole Airbnb movement and stuff. But back to acquisitions. So there’s two times that we like to buy. One is when they’re trying to get their construction financing and they’re really motivated to sell some units. And then the second is when they’re sitting on standing inventory unsold units, which is the case in Calgary right now where we’re buying. So those are the kind of two motivation points for the developer and will tend to give them full, full asking price. And then we get them to give us some really good terms because the next buyer will see the price and it’ll set a strong precedent for them. And then we get some really cool terms of the deal, which could be a whole gambit of different things we could ask for. But the benefit, like if there’s one investor doing a joint venture with us and they’re just able to buy one condo, you know, they get the buying power of four or six or eight units. So that’s kind of been our model now. And where we’d like to go with it is, you know, these types of high-rise projects where we could do, you know, a whole. Law of supersedes, maybe three floors of independent living. And then really get some serious buying power that way.

Rob Break [00:30:58] So now I’m sure this has come up before, but what about the whole idea that maybe the bottom floors of the seniors might not really enjoy the in and out of the super suites?

Derek Peever [00:31:12] Yeah. So like in this type of high-rise project, when you get off on a floor, it would feel like a seniors independent living floor, like they’re not mixed with super suites on the same floor. And there’s different views on that. I think the senior of tomorrow doesn’t want to feel like they’re being kind of put out to pasture. And, you know, at this building where there’s no real buzz going on, like, I take the view that seniors want to be in the mix, like in an integrated community with different ages of people, owner occupiers.

Rob Break [00:31:43] Well, I guess that’s a good point. I mean, maybe, maybe not all of them, but I’m sure there definitely are some. I would imagine that’s a good point.

Derek Peever [00:31:50] I think those are a little bit maybe the touch older than the client we’re going for. Mm hmm. Like, I toured all the seniors facilities in the area that were doing this, and that’s the product of yesterday, right? Like the one bedrooms, the tiny kitchens, no laundry, and suites like the seniors that we’re going for are totally different kettle of fish. They expect really high end and full-size suites and spare bedrooms and amenities and resort style living.

Rob Break [00:32:20] I see myself on the way to becoming one of those seniors of yesterday, that’s for sure, because I’m already at the point where I’m like, Get away from me loud. Turn the volume down. And I don’t know. So that was just why that question came into my head. I don’t think I’m going to be all that hip, but I guess we’ll see. So and I actually saw I think it was on Facebook. Maybe your most recent project in Calgary. One of the suites was on YouTube. Yes, I think. And it looked fantastic. Thank you. So yeah, everyone should go over to YouTube, and I think you just put in super suites and that will come up.

Derek Peever [00:33:00] Calgary grads working hard out there. It’s a tough market right now.

Rob Break [00:33:04] That’s two of your companies that we’ve talked about, and I know there’s a bunch we could talk all day, but you run five companies, so that’s not really an easy task as one man. So what types of systems do you have in place to help you run your business as more effectively?

Derek Peever [00:33:20] Yeah. So, you know, to say I run them is a bit misleading, maybe. But I’ve got awesome people. I run around me and, you know, I just really enjoy just starting new things and setting up teams of people. And, you know, the whole Jim Collins, get those get the best people on the bus, you know, you just find good people. You don’t create them full time talent scout, right, is something I tell myself all the time. And just when I finally toss and people, then I try to rope them into, you know, one of our ideas or one of our real estate-based businesses. And they all kind of complement the other like, for example, in kind homes is a new business that we’re starting and it’s going to be working with super sweet to produce what we call super suites on demand, which is a basically a portable condominium where when somebody has a flood or fire at their home or tree falls on their home or any disaster that can happen, we can actually deliver like a self-contained nine hundred and fifty square foot two bed, two bath portable condo right to their property. And that’s what any kind homes does is it produces these, you know, small homes, coach homes, rec homes, you know, surge housing, all kinds of cool, manufactured home products.

Rob Break [00:34:42] Tell us a little bit about that. How does that work? What does that to two trailers kind of thing.

Derek Peever [00:34:49] What it is we actually started off thinking that we were going to do these in shipping containers because there’s a big problem out here where these one trippers get sent from China and then they just sit on our docks. So obviously, we want to be, you know, green, and recycle and do all that. But the more we researched it, the more we dug into it. Over a couple of years, we decided that the way to go was actually to build one, you know, either steel or wood construction manufactured home. And as you guys may know, that’s a big trend. Just in the construction industry in general is 3D modular in 2D modular. I was involved with a building in Fort St. John where we had a general contractor. We’re trying to build 90 units up there in two phases, and we put it out to a contractor who took it to 12 modular builders. And through that whole process, you know, I learned to do the best ones were narrowed it down to two and then the super suites on demand thing. Came out of that.

Rob Break [00:35:52] That sounds really interesting.

Derek Peever [00:35:54] Yeah, because in these harsh markets or these harsh climates, I mean, like in the north, by building the property manufactured, then you take your risk out of it as far as weather and, you know, cost overruns with labor shortages and things like that. So you pay a bit of a premium like an insurance policy, but you know that, you know, that’s what it’s going to cost. Kind of thing is the idea.

Rob Break [00:36:21] So now it’s almost as if you can turn that model into like a builder for permanent structures that something absolutely

Derek Peever [00:36:31] like soon as you marry it to a property, you can get a number and get typical financing right, like they’re fully financeable because they’re built for the proper

Rob Break [00:36:40] stuff. Yeah, that’s fantastic.

Derek Peever [00:36:42] Yeah, it’s a great exit strategy as well for the super suites on demand when they’re when they’re tired or, you know, we’re on to a better model or whatever. But, you know, even on the super sweet on demand, we’re in talks with leasing companies that will finance them for us. So it’s exciting.

Rob Break [00:36:59] Yeah, that’s very cool. It sounds like I should

Sandy Mackay [00:37:03] hear rather

Derek Peever [00:37:04] the story. The question, actually, I think, was what types of systems and

Sandy Mackay [00:37:09] was sorry

Derek Peever [00:37:11] organization rate. It’s just it’s the obvious huge one. But one little thing I was going to share was I use this little system for myself out of the E-Myth. Have you guys heard of that but have a Gerber? Yeah, yeah. So every day I make these three lists, I got my entrepreneur list, my list, I’ve got my managerial list and my technician list. And what or task list, right? And what did I do? Is, for example, at night, I’ll work on my entrepreneurial task because I just don’t get tired, and I can get energized at night. In the morning, I’ll crush, you know, the T list, the task list and the managerial things are generally things I have to schedule, you know, locked windows of time, like two-hour minimum windows of time to hit those and actually rewrite them all daily. I’m still on the old paper system, but that that I think has been really key for me.

Rob Break [00:38:04] Cool. Yeah, that’s a good one, too. Thank you. And I like best people. Surround yourself with the best people. Yeah, another good one. That’s the key. So you’ve also done several successful joint venture partnerships, like you mentioned earlier. Now, who is the ideal person who could benefit from working with you and your company?

Derek Peever [00:38:23] Yeah. So, you know, I’ve actually never done a deal that wasn’t a joint venture. Interestingly enough, even my principal residence is a joint venture.

Rob Break [00:38:31] You’re talking about a marriage there.

Sandy Mackay [00:38:33] No investor.

Derek Peever [00:38:36] But yeah, it’s called the hassle-free tenant strategy. And it’s, you know, someone else puts up the money you make. All the payments, add value to the property and split it 50-50 because the best use of my money is owed in other deals, because that’s the easiest one to raise money for. That’s just a no brainer for an investor, right? But yeah, so the ideal person, like the ideal client that that comes to super suites, they’re generally seeking income and they’re willing to give up what I call the maybe money, the appreciation. They’re willing to give up some of it in exchange for very predictable but not guaranteed, you know, monthly income. So they’re usually people that have a career. They have a family, they’re busy. They don’t want to take the time to, you know, get on podcasts, and go to seminars and, you know, do it. So they’re happy to give up part of the profit. The cool thing, too, is that, you know, I don’t mark anything up and I don’t make a dollar if they don’t make it all or and if we have vacancy or something, I’m on the hook for it too, right?

Rob Break [00:39:43] So, yeah, sounds like a very Win-Win set up for partnerships. So that’s great.

Sandy Mackay [00:39:48] And what’s coming down the future? Where is your business going in the future?

Derek Peever [00:39:52] Well, right now, super suites, we’re taking it across Canada. We just in the last year, we went to Alberta and Manitoba as well with Brad McLeod in Calgary as our partner on the ground and Ben Davies. So you guys have had on the show. And yeah, that’s great to you. Yeah, great guy. And that’s what I do is I try to find a superstar in these markets. And then if the market’s also good and companies that we use and stuff our operating there, which is generally the case, then we’ll go and open up that market. And you know, we’ve been talking to Rich Dan Baird in Ottawa and just, you know, we’d like to get into Ontario. So maybe that’s something we could talk about some more and

Sandy Mackay [00:40:33] I was saying, which also was on the show. Oh, yeah, that’s right. Yeah. Another great guy.

Derek Peever [00:40:38] But yeah, no, I’d like to, you know, whether we go global on the global or not, I’d like to create a world class company and you know, quality is more important than size to me.

Sandy Mackay [00:40:48] So if anyone else is interested in joining up. You in some way, maybe there’s other people sitting back here in another great market in Canada, maybe they can reach out.

Rob Break [00:40:55] Yeah, absolutely.

Derek Peever [00:40:57] Absolutely. You know, we’re always looking for quality people and go from there.

Sandy Mackay [00:41:03] How do you gauge what market works for that or not? Is a certain size the market needs to be? What do you

Derek Peever [00:41:08] think? Yeah. So, you know, we’ve had some fewer desirable experiences in the smaller markets like even Alberta is so cyclical, even in Calgary. But we still really like Calgary because long haul or super confident in it. But Red Deer, we’ve owned condos in Red Deer. Those have kind of beat us up over the years. Not super sweet. You know, they were the zero down ugly condo converted stuff I wish I never bought. But you know, I like major markets ish where they have job growth, population growth, all the stuff you learn, transportation improvements. You know, we’ll try to buy a new condo where there’s a train station coming into office. Calgary, we’re right across the street from a brand-new major hospital. You know, we fish off the piers of, you know, obviously insurance, but health care, aerospace, those kinds of things. So we like to be close to those types of areas fairly close.

Rob Break [00:42:06] And you mentioned also, I guess, whoever you’re working with service providers or what? Oh, yeah, yeah.

Derek Peever [00:42:11] So companies that we work with could be rail could be health care, which is, you know, insurance adjusters. Those are the kind of clients. And the cool thing is, all these companies that operate in the Fraser Valley operate in Calgary, and a lot of them operate in Winnipeg. So we’re kind of leveraging those existing relationships into the new markets.

Rob Break [00:42:33] I always picture somebody in, say, Red Deer, like you were talking about just sitting there, listening to the show for the first time, wanting to get involved in investing. They go, I know I can make it work here. And then you go, and you go, Yeah, Red Deer. Yeah, that that plays. Beat us up.

Derek Peever [00:42:49] Yeah, well, it’s not Red Deer, it’s the type of property we bought and the area we bought in. Mm-Hmm. You know that could happen to you anywhere. I’m sure there’s great stuff in Red Deer and it’s got to be ready for the swings in Alberta. That’s all. Yeah, makes

Sandy Mackay [00:43:04] sense. What is it that motivates you? What keeps you really excited to keep going with this stuff? And what gets it gives you the inspiration and drive?

Derek Peever [00:43:12] Well, I just love what I do. It’s like Buffett, right? I just tap dance to work. I got a I got a sudden alarm clock to go to bed. It’s just, you know, I love working with people that I work with. And, you know, obviously I want to kind of, as you may have could tell here, like Warren Buffett’s one of my heroes and I want to obviously make it make the most money I possibly can and give the vast majority of it away to good causes in the end. And I’m really passionate about animal rights and, you know, just service to many leads to greatness, right? So we’re just trying to serve the market and eventually the market will show us love.

Rob Break [00:43:52] Well, you mentioned a few things there, rich diet and whatnot the IMF and Warren Buffett throughout the show. But are there any other resources or different things that you can recommend to new investors just starting out?

Derek Peever [00:44:05] Yeah. So I’ve been a long-term member of most of the meetup groups and in the Fraser Valley here, like Rain Rig, the real estate action group, it’s another good one out of Vancouver truly invested in Winnipeg Crew magazine. You know, all those kinds of things are good resources, and I’m always a big supporter of, you know, YouTube University, right? Like, that’s where I went to university. I didn’t have any formal education or anything, but you can get a pretty awesome education, just, you know, on your show, for example. Other than that, like the real big things for me is I’m a big fan of guys like Jim Roan, Les Brown, Zig Ziglar, you know, like, I start my day with that stuff cranked and listening to it all the time. So not just technical, you know, real estate business stuff, but just that whole philosophy part, right?

Rob Break [00:44:54] Yeah. Stuff to get you amped up before you start getting into that technical stuff. Exactly. Yeah, good. I love Jim Rohn. One of my thoughts so choked.

Derek Peever [00:45:05] I didn’t get to meet him. Guys, I’ll put this on the podcast because I’m going to do it. I’m getting a Mount Rushmore tattoo off that are across the top of my back with Jim Rowan’s face, Les Brown’s face, Zig Ziglar.

Sandy Mackay [00:45:19] Really?

Rob Break [00:45:20] I’m doing. You have to send us a picture that that’s going to be, you know, on our on the podcast website for your show. Yeah, yeah.

Derek Peever [00:45:28] Let’s put it out there. I’ve been talking about it long enough.

Sandy Mackay [00:45:31] Well, there we go. That isn’t there. And it’s going to

Derek Peever [00:45:34] say standing on the shoulders of giants.

Rob Break [00:45:37] Oh, yeah, who’s the fourth?

Derek Peever [00:45:39] It’s there’s a few contenders right now.

Rob Break [00:45:41] OK, well, I guess we’ll find out there. Just come back and check it out. Find out who the fourth is.

Sandy Mackay [00:45:50] Do you think of him?

Derek Peever [00:45:52] He’s great. He started off at Jim Rowland seminars. Yeah, that’s right. He’s like, I listen to his stuff. He’s not like one of my top guys. I’m kind of on that older generation, I guess, but he’s awesome. There’s no doubt

Sandy Mackay [00:46:06] the reason I’m making my Rushmore, though, OK? I don’t know. He’s not on there now.

Rob Break [00:46:11] So how can people get in touch with you?

Derek Peever [00:46:14] Well, they could just Google Derek Pepper, you know my phone number six four six five seven nine nine zero nine Derek at Peever. Com on LinkedIn, Facebook, you name it.

Rob Break [00:46:25] And that’s PVR and as well, you know, as we always do, we’re going to put links to all of your services in our show notes so that people can easily get in touch with you through that as well if they can get to a computer to click on to that. So Derek, man, this has been great. Thank you so much for coming on.

Derek Peever [00:46:47] Thank you, guys. It was a lot of fun.

Rob Break [00:46:48] Yeah, I learned a lot.

Sandy Mackay [00:46:50] Super interesting. A lot of new stuff we never talked about. We have not anyone out west for a while either. No, we

Rob Break [00:46:54] haven’t. And hopefully we’ll be able to meet at some point. Absolutely.

Derek Peever [00:46:58] Yeah. And if you guys are ever out in in my neck of the woods or Calgary or Winnipeg, you know, let us know and we’ll put you up in a nice suite.

Rob Break [00:47:07] Oh, see, OK, well, I’ll take you up on that. You bet. My wife’s sister lives in Edmonton, so maybe Calgary is just far enough away.

Derek Peever [00:47:15] Well, you know what? We’ve got a deal under contract in Windermere right now. Eight units top floor. 16tH floor.

Rob Break [00:47:21] OK, and then I’m guessing that’s close to Edmonton.

Derek Peever [00:47:24] That is Edmonton. Oh, it is Edmonton. OK, it’s the best area of Edmonton. Perfect.

Rob Break [00:47:29] All right. Well, let me know when it’s ready to go. OK, so I said, how can people get in touch with you?

Sandy Mackay [00:47:35] Yeah. If we want to reach out to any questions about this episode or any other guest, there’s hot or real estate in Hamilton or else in general, we can always reach out to me through our office. Nine five three zero eight three three three. And of course, you can get it to Arava and or through our email in for our breakthrough our podcast dossier as well.

Rob Break [00:47:54] If you want to join our Mastermind and Property Tour. I’ll be hosting them on March 12th and 25th of this year. So if you missed those two, I usually do them twice a month or so. Check out a renovation project and then head off to see some properties that can be converted to legal two units. Check out the requirements and the obstacles, and of course, the numbers on the current projects that somebody in our group is doing as a as a renovation and then head out to see what’s for sale. So if you’re interested in coming out, they’re always informative and fun. So contact me if you’d like to join in. My number is two eight nine two seven zero four six four and like S.E. said, you can reach me at info at Breakthrough Aria Podcast Dossier

Sandy Mackay [00:48:42] and you get here, and you can you go to Australia, go farther east.

Rob Break [00:48:46] You know what? We’re adding Kawartha Lakes now to sew up towards Peterborough area as well. We’re going to get some mega cash flow out there as well. It’s time for everybody’s appetizer and hopefully they can work up to some main course and dessert as we go through this state investing journey. So everyone will see you next time.

Sandy Mackay [00:49:05] Thanks, guys. But. Now.

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