#InvestorSpotlight: Marc Bushee, J K Property Partners

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Podcast Transcription

Dave Dubeau [00:00:09] Everyone Dave Dubeau here with the property, Profits Real Estate podcast here with another one of our investors, spotlight interviews today with Marc Bushee zooming in all the way from Fargo, North Dakota. How are you doing today, Mark now?

Marc Bushee [00:00:23] Amazing now. Thanks for having me on.

Dave Dubeau [00:00:25] My pleasure. So Mark is a real estate investor. He’s also a realtor. He’s been in the business for over 13 years at this point, and he’s very actively investing in real estate, as well as hearing me talking about what Marques likes to invest in, why it makes so much sense and what’s in it for him and his investor partners. So why don’t you tell us a little bit about how did you get started with real estate investing and what really kind of pique your curiosity, your interest?

Marc Bushee [00:00:54] Sure. My first interest in this was about two thousand eight. And that same time, everyone else, of course, was trying to flip houses and it was during the bubble. And HGTV has, you know, show shows, that’s all house flippers, whatnot. So I had I got interested and then read it. I read some books. Rich Dad, Poor Dad, of course, is a book. They got so many people into real estate. And so I was interested in that, and I thought, Well, why not just get fully into this? And so I so I actually use my vacation at my last job, went down and got my real estate license for my two weeks’ notice, then became a realtor and said, I’m going to do this full time and be a realtor and become an investor. So I had a partner who was a contractor who we started off with together just buying some little fixer upper is our first little complex, worked on some apartments on the weekends, that kind of thing, and just got more and more involved.

Dave Dubeau [00:01:38] So, so you started right off the get go with small multifamily properties. Is that correct?

Marc Bushee [00:01:44] Yeah, mostly it. While single family and a couple of small multiuse and so bought cheap, fixed them up, got them rented out, you know, increase the rents and just that we’ve just been buying and holding for the most part on these properties.

Dave Dubeau [00:01:55] Well, that’s interesting because a lot of people like you, you’re saying they see these HGTV shows and flip this house and all that kind of stuff makes flipping look like a lot of fun. But are you guys kind of went along those lines? You found properties that needed to be fixed up, but instead of flipping them, you held on to life. What kind of clued you into that?

Marc Bushee [00:02:13] Well, I didn’t know what it was called at the time, but now people call it the burger strategy. I guess that’s a common term. You know, it’s the buyer rehab was a refinance, rent out, repeat, you know, so instead of flipping the house and getting rid of it, we just thought it’s better to hold as an asset. And so we did the rehab. We would rent it out, hold the property, and eventually we could refinance the property and pull cash out, which is almost like flipping. But you get to keep the property.

Dave Dubeau [00:02:36] Yeah. So it sounds like a hell of a better idea to me.

Marc Bushee [00:02:39] Yeah. So we keep we keep the assets we call the money out and go buy the next property. And that’s where we just kind of kept doing rinse and repeat over and over. So as we gained a little bit of capital, some equity in my partner who was the contractor, decided to become a homebuilder and we took on a third partner and added we started building in 10 homes, some townhomes for rentals, and that was a great basement there for us and then just kind of went from there. We’ve gone to some other multifamily and now our biggest thing is storage units.

Dave Dubeau [00:03:06] So self-storage facilities. Greg Sandy So that’s what kind of I mean, it’s interesting to see your transition, your growth as an investor. So you saw the TV shows you took massive action, jumped well full bore into this as a full time profession. That’s pretty smart doing it both ways. As a realtor and as an active investor, what have been some of the big benefits for you by being involved from both sides of the table that way?

Marc Bushee [00:03:36] Yeah. So my idea was the first company I joined. The first brokerage I joined was a company in town where I met Fargo here, and that does kind of a little bit of everything they did in home sales, commercial, residential. I mean, they do investments, rental property management, construction, land development, the whole thing. So my idea was to become get into an office where there’s experts all around me. And so anything I want to learn or questions about, I could just literally down the hall. I could just go talk to an expert in the region. And so I also got into land development quite a bit. I was doing sales and working for the largest developer for residential development in the region here as well. So that was great. I got to learn there, the market very well. I got to meet all the builders and contractors and stuff. So I kind of got myself just immersed in the whole thing. And it was so nice to meet all these experts and have just these great people around me. And so that’s my goal and that’s what I did.

Dave Dubeau [00:04:27] That is fantastic. All right. So went from single family homes and small little multifamily is into the land development and multifamily. And now you’re starting to look into and focus a lot more on self-storage. What is it about self-storage that you like so much comparing and contrasting it with what you’ve done before?

Marc Bushee [00:04:48] Well, there’s no tenants, there’s no toilets, there’s no pads. It’s got the same concept as having, you know, if you have a hundred storage units versus 100 apartments is the same idea. You’re renting out these units and making a profit. But there’s no one living there. There’s no one lay calls for water leaks or frozen pipes or whatever. You know, they literally are renting garages. The worst thing that can happen is they might back in your garage door, whatever. You know, that’s one of the big appealing factors for us is that they’re easier to manage, they’re easier to maintain and they’re just it’s just more simplified. So, you

Dave Dubeau [00:05:21] know. All right. So there’s a lot less of a pain in the butt

Marc Bushee [00:05:24] kind of nuts. And don’t get me wrong, we still have the rentals. We’re still looking for more rentals that way. But this has been another avenue we’ve been looking at here. So we just bought our third storage facility here this year. And so Aspen,

Dave Dubeau [00:05:37] yeah, that’s fantastic. And whereabouts, are you doing most of your investing? What markets are you focusing on, Mark?

Marc Bushee [00:05:43] So I’m in Fargo, North Dakota. So or in the eastern side of the state of North Dakota and the western border of Minnesota. I do focus mostly in the area I live, but we do have a few investments outside of town, so. But still, it’s within a couple of hours, almost the distance right now. So we are looking at some

Dave Dubeau [00:06:00] things besides the convenience factor. What are some of the fundamentals around this market that make it a good one to invest in?

Marc Bushee [00:06:06] Well, one thing is I know the market, so I’m from this area. I’ve lived here my entire life. I understand the markets better than if I just went to some random city and had to learn from scratch, you know? And I’m a Midwest here is just really, I think is a great place to live, to work, to play. It’s just the people around here. We don’t have big cities. We don’t have the big crime; we don’t have big traffic. We don’t have things like that stable economy. Even through the big recession we had in two thousand nine 10, this region brought it out fine. In fact, we excel. There was never had high unemployment. We never had a bad housing crash. So it’s just been very stable and that’s very appealing to me as well.

Dave Dubeau [00:06:42] Sometimes, you know, steady Eddie wins the race, right?

Marc Bushee [00:06:45] I mean, I don’t like the big swings. I like the I like the steady. It’s kind of funny because I just started dabbling in crypto, and it’s so funny to watch this because these crypto coins just fall over. Yeah, scary. But I like the stable income.

Dave Dubeau [00:06:59] Yeah. Yeah. No, that makes a lot of sense. Well, let’s go back a little bit and talking about self-storage because I find that asset class absolutely fascinating. So besides the convenience factor and the lack of relatively speaking of headaches, you know, dealing with tenants and toilets and all those kind of things that you get to do with multifamily investments, what are some of the big benefits for you and some of your partners when you invest in a storage facility? What do you what are the pros on this?

Marc Bushee [00:07:30] That’s some of the same benefits as buying multifamily, larger multifamily as well. What would those

Dave Dubeau [00:07:34] be for people that aren’t familiar with that?

Marc Bushee [00:07:35] Well, just having first of all, this is a central location. You know, I’d rather have apartment building or sort of still all in one location that’s easy to manage versus both houses,

Dave Dubeau [00:07:44] you know, 15 different little single-family homes. Got it.

Marc Bushee [00:07:48] From a property management standpoint, it just simplifies everything having one central location. I have kind of transferred over most of my property management to other people now. I don’t really do much personally, but it’s not always easy to find property managers that want to have 10, 15, 20, 30 houses all over town. It’s so much easier to have just one site like that, so that’s a central location is a big bonus there and just the numbers game. And also, you know, it’s easier by one facility or one apartment building than it is to buy a whole bunch of houses and find a whole bunch of deals. So it’s just finding that one dealer, one facility at a time and versus having to unpack for every little deals everywhere.

Dave Dubeau [00:08:23] And now storage versus apartments, for example, where you know, we’ve got the convenience factor there as well. What else is another big benefit for that versus other kinds of real estate, would you say?

Marc Bushee [00:08:35] Well, I don’t know if it’s any better than the fact that it’s going to. I think it’s always going to be there. People are writing about downsizing a lot of your personal homes and stuff, but there’s so many places to store things, and I don’t think that’s going to go away anytime soon. Especially, it seems like with younger people, the money is that kind of thing. People don’t aren’t looking for giant houses anymore. They’re not going to have all this place to store, but they still have things. And so I don’t see it going anywhere soon, and it’s just a very easy asset class to manage. It’s going to be a stable, I think, for a long time.

Dave Dubeau [00:09:03] And we, North America, we love our stuff. Right? I mean, we know we got stuff coming out our ears. We need somewhere to put it. We’re loathe to sell it or get rid of it. So storage facilities are great now. Correct me if I’m wrong, Marc, but I’ve also heard that, you know, nothing’s perfect there when it comes to a stable asset class stuff. Self-storage is pretty much as recession resistant as they come, right? Because when times are good, people are making more money, they’re buying more stuff. They need somewhere to put it. So they need self-storage when times aren’t so good. Unfortunately, people are losing their homes, they’re downsizing. They still need somewhere to store their stuff, right? So it’s kind of, from your perspective, kind of. Either way, it works well for you. Would you agree with that?

Marc Bushee [00:09:55] I agree. So it’s especially where we’re at here. So I think we have similar weather to where you’re at Canada. We have cold winters and hot summers and stuff, but we have a lot of seasonal transition, so there’s always something to store. There’s people sort of built their store in their winter stuff. They’re. There. We don’t see a lot of walls in the business, you know, it just seems to be pretty stable around as well.

Dave Dubeau [00:10:13] So what is done is beautiful. Now let me ask you some of your markers. I’ve heard this. I don’t know if it’s true or not, but I’ve heard a lot of places. The actual amount of rent you get per square foot of a storage unit is the equivalent of what you get for the same square footage in an apartment. Is that true where you’re at? I mean, obviously storage units are a lot smaller than apartment, but on a square foot basis, is it fairly close?

Marc Bushee [00:10:43] It’s similarity getting a slightly less per foot, I would say, in the storage, but it’s not a big difference. Again, there’s two buildings, and to maintain them is far less than the apartments are four foot two.

Dave Dubeau [00:10:52] So that’s what I mean. Your overhead is so much lower than a storage facility you don’t have to worry about. Well, you might have concerns with some of your units. You might have heated units and other units that are. I’m not sure.

Marc Bushee [00:11:04] And you’re yeah, we don’t personally have any climate control, but there is. That is a

Dave Dubeau [00:11:09] even better if you don’t because then you don’t

Marc Bushee [00:11:12] have water bills. We don’t have any gas bills. Nothing, the only I mean, our maintenance utilities, our electricity for lighting gets normal in the winter. Yeah, you know, he got to take care of the lot in the summer. That’s, you know, that’s here. That’s about how much to it.

Dave Dubeau [00:11:26] So, yeah, you know, it’s a much, much simpler business model that is fascinating. All right. Now, Robert Kiyosaki, you talked about you read the book Rich Dad, Poor Dad, which was one of the things that kind of got you going. He also has this concept when he calls your unfair advantage, where he says all of us have some sort of an unfair advantage, but what we focus on real estate investing. So besides the fact that, you know, we’re darn good looking and modest, what would you say is your unfair advantage when it comes to real estate investment?

Marc Bushee [00:11:58] Well, I think just the what the approach I took with immersing myself fully into this, this whole thing, I don’t, you know, I like I said, I quit my job. I said, I’m going to become a full time realtor and I’m going to learn from the experts. And so I just immersed myself in this whole thing here. The other thing for me personally is that I’ve lived in this area my entire life, and so I really know this region. I’ve gotten to know investors, just different people in the region here and the market itself. So I would say that would be a definite advantage for me, especially. I made a lot of people coming to the area just met with amazing gentlemen here this last week is getting his property manager for some nice new apartments. Doesn’t know at all. So and I know and I’m going to introduce this guy to everybody around here, and this is nice having notes. That is an advantage for me as having the network and the knowledge base

Dave Dubeau [00:12:42] and my regional staff. And you’re born and raised in the area that you’re investing in. You’ve got definitely got the insider perspective for more ways than one there. Now, Mark Ayres, here’s a question I got for you. Do you think that real estate investing is a good choice for everyone?

Marc Bushee [00:12:58] No, I can’t see where you can go around with it, to be honest with you. There’s so much to it as far as like all the just the income itself, there’s the wealth building aspect of, you know, your asset is appreciating, ideally paying off someone’s paying off your mortgage, you’re leveraging money, leveraging time. Is it for everyone to be directly involved in it? Maybe not. You don’t. Maybe don’t want to be the guy out there, you know, change and toilets and, you know, working on painting units all the time, that kind of thing, working with tenants. But in some way or another, I think there’s that real estate’s a great investment for just about anybody. You can be as active and hands on as you want, or you can be very passive and just, you know, that’s what partners are best with other people.

Dave Dubeau [00:13:39] So, yeah, so that makes a lot of sense. Well, Marc, there’s been a lot of fun. It’s fascinating what you’re up to with real estate, investing your progression from just kind of hearing about it then. I mean, you just jumped in with both feet, becoming a realtor and then starting to invest in smaller properties and then building up, building up, building up over time and now shifting into these self-storage facilities, which I agree. I think that’s absolutely fascinating. So hats off to you for all you’ve accomplished. And if people are watching this and they want to connect with you, what should they do?

Marc Bushee [00:14:13] Well, he can reach me on my website here and my brokerage. That’s March at J-K Property Partners WSJ.com email. You can just email me at Marc Bucci at Gmail.com Phone number seven eight one seven nine three eight five four three. I’m always available to me coffee or lunch, whatever. I just I’d love to network. I try to plan something almost every single day just to meet new people. So I’m always available. I can talk real estate too much. We’ll sit and talk forever. So it’s fun, though I can just it’s just fun to meet new people in this stuff. Talk about this stuff. Yeah, you’re

Dave Dubeau [00:14:43] definitely very passionate about it. Mark, thank you very much.

Marc Bushee [00:14:46] Thank you. Appreciate it. Yep. All right. Thank you.

Dave Dubeau [00:14:49] All right, everybody. Take care. We’ll see you on the next episode. 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’d be awesome. I appreciate that. And if you’re looking to attract investors and raise capital to. I may invite you to get a complimentary copy of my newest book Right Back There. Ernest, the money partner formula, you’ve got a PDF version, an investor attraction book dot com again investor attraction, book dot com. Take care.

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