Multi-Res, Multiple Offers & Payments Plans With Cliff Ford

Multi-Res, Multiple Offers & Payments Plans With Cliff Ford
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Table of Contents - Multi-Res, Multiple Offers & Payments Plans With Cliff Ford

Podcast Transcription

George El Masri [00:00:00] Ladies and gentlemen, welcome to another episode of the Well Off Podcast. I'm George Elmasry, and today I interviewed Cliff Ford, who is a sales rep with Skyview Realty. So for those that don't know Skyview, they basically specialize in multiunit sales. They've been around since the 80s. So it's been quite a while. And based on what Cliff was telling me, it's all they do. They don't do any residential or single family homes or condos or anything like that. So, yeah, Cliff and I had a chance to talk about a lot of different things, especially given that, you know, with covid and all that, some of the challenges that they've had with either finding properties or maybe even dealing with some of the tenants. And we did talk about payment plans and making sure to constantly reach out to your tenants to make sure that you're identifying any problems that might occur ahead of time. We talked about vendor take backs and some of the terms that they've been able to work out lately with that and especially vendor tailbacks and second position, what kind of rates they're they're typically seeing right now. We also talked about the demand for multiunit properties right now. And one example was a 41 unit building that they recently sold that had 14 offers on it. So that's pretty crazy when you think about it. Obviously, 41 units isn't going to be cheap and to get 14 offers on it is pretty intense. So it's pretty interesting to see where the market's headed. If you are interested in multiple units, this is a great episode for you to check out. And if you have any questions, you can always contact me. I'd love to chat with you about small multis. I work typically on four to six unit buildings and we're looking at well, in St. Catherine's in Hamilton. So if you're interested in those markets, you could reach out by going to Well-off Dossie and you can book a call there and also you can download some free reports while FDCPA for its last report. So there you go. Enjoy the episode. Welcome to the Life podcast, where the goal is to motivate, inspire and share success principles. Today I'm here with Cliff Ford, who is a sales rep with Skyview Realty. And for those that don't know, Skyview is a brokerage that specializes in the sale of multiunit residential buildings throughout Ontario exclusively. And Cliff has been involved in the sale of over two hundred apartment buildings. So he's obviously an expert in that field. So I look forward to picking your brain today. Cliff, thank you for joining us.

Cliff Ford [00:02:14] Thanks for having me.

George El Masri [00:02:16] Yeah. So I'd like to start off by asking you about your childhood. I want to tell me a little bit about where you grew up and one or two things you remember from back then.

Cliff Ford [00:02:23] Sure. Yeah, that's a great question. I actually grew up for a good portion of my my childhood overseas. I actually lived in Haiti for a few years. And so I've got a chance to see different parts of the world. And then I was born in Toronto. We moved back to Toronto after Haiti. And I've been in the Toronto area ever since.

George El Masri [00:02:47] So does that mean you speak French?

Cliff Ford [00:02:50] I do a little bit. I used to speak actually down there. It was sort of a half French, half Latin, half English version called Creole. And I used to speak that as a kid. I think I've lost it since then.

George El Masri [00:03:04] Yeah. All right, cool. OK, so let's let's talk about some multiunit here. I love talking about units. That's space that I'm interested in as well. So first of all, just out of curiosity, because I've personally actually never heard of Skyview until now, but I know you guys have been around for a long time. And the founder, you were saying started off basically just dealing exclusively with multiunit. So do you want to tell us a little bit about Skyview?

Cliff Ford [00:03:31] Yeah, for sure. So our founder, Danny, you know, in the early 80s when he got out of university, he quickly realized that, you know, the field that he was going into for education and training was not the one that he wanted to spend the rest of his life doing. And he had a a passion from, you know, from childhood to to basically own apartment buildings. He used to tell his parents growing up that that's what he was going to do. And so coming out of universities, started by buying first a triplex and then sold that and it started getting bigger and bigger and bigger. And then, you know, that passion for that multi field drew him to to open up his own brokerage. And so he founded Skyview Realty in 1989. And for the last 30 years, that's all we've done, is focused on the multi residential field here in an Ontario cool.

George El Masri [00:04:26] So what markets are you guys in? Are you going up to like Sudbury and Timmins and stuff like that? Or are you sticking to a certain radius of Toronto?

Cliff Ford [00:04:36] You know, for for the majority of the years that I've been there, we've basically focused on southern Ontario. So pretty much anywhere from Australia south down to Windsor and to Kingston. But in recent months, we've started to explore looking into the northern area. So we've been dealing with some sales in the same area as an example. And that's been, you know, just a new foray for us to to explore those markets as well.

George El Masri [00:05:03] Cool. Sounds good. OK, so let's let's get into the details here. What kind of multis are you guys looking for? Is it first of all, obviously you're a sales rep, so you work with your clients. But does Skyview also do some kind of like purchasing for their own, for your for yourselves and that type of thing?

Cliff Ford [00:05:26] Yeah, actually, you know, that's something that not everyone necessarily knows about Skyview, is that not only do we broker and sell these properties, we've also been fortunate enough to to purchase a number of properties for ourselves over the years. And so we've got a management division. And what we find is that that becomes a significant benefit to our clients because, you know, not only are we selling these these types of properties, but we also understand them. So we understand the financial details behind it, the level of due diligence detail that goes into these types of transactions. And having that management part of our sort of wing of our company allows us to tap into the expertize of our property managers or our acquisitions teams

George El Masri [00:06:13] or so what have been some of the challenges that you faced in the multiverses space in recent months?

Cliff Ford [00:06:21] You know, obviously, the pandemic had an impact on on our business when everything first started to shut down last March, you know, we were a little concerned. We thought we were going to have some some trouble times ahead with our portfolio and with dealing with the sales. And certainly we saw, you know, in the first month of after the stay at home orders went out, you know, the industry kind of took a pause. Everybody just put put everything on pause to see what was going to happen with the economy, to see what would happen with our tenant base and paying rents. But I would say industry wide and certainly for us at Skyview, we were pleasantly surprised that, you know, the measures that the government put into place with financial aid and, you know, the rules and regulations they put in there for safety, all those things worked to to basically give us a pretty healthy outlook despite the fact that the pandemic had such a great impact. Right.

George El Masri [00:07:19] OK, definitely there is there is some uncertainty when when the pandemic first hit and let's say in the last six months or so, obviously things have developed since then. Have you guys seen any challenges when it comes to finding properties or dealing with the ones, the existing ones that you own

Cliff Ford [00:07:38] were not really finding any challenges in running our operations and our buildings? You know, we've taken a very proactive approach with all of our tenants. So on a monthly basis, we have somebody in our office contacting every every tenant that we know may have trouble financially and working out payment plans and, you know, doing what we can to assist them through this time. And we found that being proactive with our tenant base allowed us to anticipate problems ahead of time and to adjust as needed. And obviously, it's helped our tenants survive through this as well, knowing that they've got a management team that is working with them, not against them. Sure. In the overall market, though, you know, the biggest issue that I'm seeing these days is there's just so much demand out there for these types of properties, which is obviously a good thing for myself as a salesperson. You know, the minute I bring a property to market, I'll have 10 or 15 people instantly, you know, interested in pursuing that property. And by the time it sort of goes through our marketing means and flows, you know, you can have hundreds of people responding on any given property, no matter what size or location. There's just such a great demand for this type of real estate right now.

George El Masri [00:08:56] Yeah, absolutely. I know a couple of colleagues of mine have recently sold their buildings and these were like in the 20, 20, 20 to 25 units and they were getting multiple offers on their buildings. Are you seeing something similar in Toronto? I don't know if like you're selling mostly in Toronto, but are you seeing multiple offers on larger buildings that are in the five to 10 million dollar range?

Cliff Ford [00:09:20] Yeah, absolutely. Almost every one of our properties that have come to market in the last few months has had multiple offers. And a classic example that we sold 41 unit building on the Hamilton Mountain a few months ago and we had 14 offers come in on the deadline for that property. Yeah, we see multiple offers all the time, even even on some of these properties that are off market opportunities where the seller says, I don't want it publicly marketed, but bring me bring me an offer or bring me a few offers. We generate a few offers right away just because there's so much demand and we know all the buyers and sellers in this marketplace.

George El Masri [00:10:04] Sure. And what are you guys doing? Speaking of off market opportunities, what are you guys doing as a team to generate these types of opportunities for your clients?

Cliff Ford [00:10:15] Yeah, because because apartment buildings are the only class of real estate that we focus on, you know, we've done well over the years in tracking who's in the market and who's coming in, bringing you into the market, who are sellers, who are buyers. We also keep notes on on buying protocols and priorities for some of our buyers in terms of what size or location they're looking for. So when we get an opportunity from an off market property and most of the time those off market properties come because a seller is concerned that they don't want to be putting it out on MLS or they don't want it to go up publicly on our website because they're afraid of tenants finding out or people just unsolicited the showing up to their buildings. Yeah. So they'll often tell us, you know, keep it quiet, just bring me one buyer or a few few small buyers and and we can get the deal done that way.

George El Masri [00:11:09] Cool. So I think from the perspective of someone who is looking for off market opportunities, it would be beneficial for them to contact you potentially and say, hey, this is what I'm looking for. I'm qualified, I'm ready to go. If you come across an off market opportunity, I'm your guy or your girl. Give me a call.

Cliff Ford [00:11:29] Yeah, that's right. Yeah, yeah. And it's really just making that that initial introduction, you know, if I if I get an email or a phone call from somebody who's looking to to invest in apartment buildings, I would generally write down exactly what they've told me in terms of their buying preferences and locations, how much they've got ready to invest. And and I will make notes of those so that when I come across those opportunities, I can look down my list and say, OK, here's the three or four people that I know are ready to act on it.

George El Masri [00:11:58] Yeah. And is your team proactively looking for off market opportunities or are you guys just waiting for them to come to you? In some ways,

Cliff Ford [00:12:07] I would say from our perspective, you know, our preference is, is to not do an off market opportunity because we find that if we expose it to our database and we put it out through our marketing strategy, we can we can easily find the best and right fit buyer for a property by casting that net to all of all of the industry, if you will. So that's usually our preference. Now, what happens is you start talking with the seller and you find out that they don't want it to go out and be marketed, and that's when it becomes an off market opportunity. So we keep those in hand to to bring to people that we know will. We'll work with them.

George El Masri [00:12:45] Sure. No, I totally understand that. So you're saying you're not you would prefer for the seller sake to go on the market because you'll attract more eyeballs and potentially get a better price. But what I'm asking is more so I know you're not looking for necessarily for off market opportunities, but sometimes if the supply is low, you might have to create your own inventory. So are you doing that? Are you doing anything proactively in those situations to find off market deals or do you guys just let them come to you?

Cliff Ford [00:13:17] Part of it part of them does does just come to us because we've been around for 30 years and a lot of the the owners in Ontario are familiar with who we are. And they worked with us at one point or another. But we also have members on our team that are dedicated to just doing research and and tracking sales in the in the Ontario market. We also had team members that, you know, they exclusively go through our database and contact people in our in our industry looking for those who may be potentially selling in the in the near future.

George El Masri [00:13:52] So are these cold calls or are they more so just people that you guys have come across over the years that have expressed some interest in selling, and then you guys are just kind of following up from time to time?

Cliff Ford [00:14:03] A little bit of both. You know, I find that when it comes to Skyview because like I said, because we've been around for 30 years and people know the name out there, it's not really a cold call because at one point or another, these owners have it with us. Whether they were inquiring on another property we were we were selling previously or they either bought or sold with us before. So we do get a lot of repeat business from clients, but we also do the cold calling in the sense of, you know, calling those people that we may not have already talked to and just introducing ourselves and telling them what we can do for them when when the time's right. Sure.

George El Masri [00:14:40] OK, yeah, I was just browsing the website and just a couple of things that I came across here. I saw that your database has over eleven thousand five hundred owners and investors and you just have a large list of properties in Ontario. So do you have some sorta like some sort of tips or tricks on how you guys were able to gather that that information was there, like a certain software that you used or anything like that?

Cliff Ford [00:15:08] No, not really use any software. I mean, we do have a database that we that we had. Developed for ourselves, which is basically just a client portal, and it allows us to keep their contact information and link them to, you know, which buildings they own. So I think really the trick of it is, is time. You know, we just spent time over the years constantly researching and building that database. And so it's a matter of just making sure that you're introducing yourself to people and knowing the people in the industry. And obviously, you know, during the pandemic, a lot of this has to be virtual. But when things open up again, you know, one of the best things you can do for any investor in there is just to start networking, be it be out there. You know, there's a lot of trade organizations, landlord associations that hosts regular events. And that's a great place for an investor to start getting connected into that network.

George El Masri [00:16:04] Yeah, absolutely. Another thing on the website was that you guys talk about properties with environmental deficiencies, structural issues, work orders, stuff like that. So can you tell us a little bit about what you guys do in the situation where you might find an opportunity with some of these problems mentioned?

Cliff Ford [00:16:25] Yeah. So, you know, we've had a few properties over the years that have had, you know, different issues. You know, what we've what we found is that when when it's an easy sale, it's a, you know, a turnkey type of property. Anybody out there can sell those. You know, the minute you've got a listing on it, you're going to find yourself a buyer and you're going to be able to get that deal done. What we find is that the difficult ones are the ones that often come our way because we're very tapped into the industry experts out there. You know, the the unfortunate thing is with a lot of real estate agents, they just want to put the listing out there and have somebody else do the work and then they get their commission check. How we approach it is a little bit different. We look at holding the hands of both the buyer and seller through the entire transaction. You know, the majority of our our deals are done as exclusive listings. And so we represent both the buyer and the seller throughout the process. And we partner with with industry experts, you know, the engineers, the lawyers, the lenders. And we have a great relationship with all those individuals so that at every stage of the real estate transaction, we're able to bring in the experts for that particular area. You know, when that comes to mind, as an example was in in North York and Finch, we had a I think it was a 32 unit building. When we went through the sales process, it turned out that there may be an underground oil tank in the parking lot. And so obviously that changes not only the timing of the transaction, but the costs associated with that transaction. Obviously, you know, you have to look and see, is there contamination in the ground from that oil tank? In that particular case, not only was there an underground storage tank under the parking lot, so now the parking lot had to be pulled up. But there was also contamination in the soil which need to be remediated. And so that took that transaction, which may have been done in two months. It took about five or six months to get done. And we had to work with engineers at each stage. So obviously any problem can be overcome in a in a real estate transaction, but it's about knowing the experts and having the patience and understanding of what it's going to take to get to the finish line.

George El Masri [00:18:47] Yeah, for sure. So if we go back to that example, do you remember what the procedure was like? I know you kind of touched on it, but did they have to dig up the entire parking lot and maybe part of the lot as well and replace that soil?

Cliff Ford [00:19:03] Yeah. Yes. So they end up once we did the phase two environmental study and discovered, yes, there was an underground storage tank, I think about 80 percent of the parking lot had to be dug up in order for them to not only remove the tank, but also to be able to excavate the soil that had been leaked into it around that area. So obviously, you know, not only are we now having to deal with the buyer and seller expectations and their, you know, expectations of what was going to happen with the process. But now we had to also coordinate with tenants for, for example, you know, a good majority of them would not have parking spaces for a couple of months while this was happening. Yeah. So, you know, we got involved in every aspect of those of those stages.

George El Masri [00:19:47] And you know why it's important to get rid of that oil tank and to replace the soil, like if it's been operating that way for dozens of years, like just just having been through that experience, you know why it's mandatory to to replace the oil tank and the soil, I should say.

Cliff Ford [00:20:05] Yeah, you know, certainly yet you have to follow the environmental laws, you know, the biggest impact that it has on an owner from an ownership perspective is obviously lenders are not willing to to give the regular mortgage to a property that has contamination and is not compliant with its environmental laws. So for the buyer picking up that property, if he wanted to have, you know, a proper mortgage and really leverage his investment dollars, he had to make sure that it was properly cleaned up as well. OK, yeah. And you know that that's something that we advise all of our clients. You know, if you're going in and you're purchasing an apartment building, even if you're not getting financing, you know, for example, if a vendor take back mortgage was was in place and you didn't need to go to an official lender. Our advice is always still go and get an environmental test done and get that report in hand to know that you're covered because you don't want that liability cropping up five years down the road when you go to get your formal financing.

George El Masri [00:21:11] Oh, definitely. Yeah. And speaking of ITVS, so what's been your experience in the last year or so with VTP? Are you finding that you guys have been able to secure them on certain properties, or is it a little bit more difficult because of the lack of supply and the ease of which people are able to sell their their properties at this time?

Cliff Ford [00:21:34] So I would say, you know, in about half of the transactions that we've done in the last six months to a year, I would say half of them, there was some form of vendor take back financing involved. And most of the time that's in second position. What we find is that sellers will be open to a vendor take back mortgage if they're getting the rest of their terms. So if they're getting the price that they were expecting, oftentimes that price because of of the market interest in the just the amount of interest in these properties, you're paying a bit of a premium, especially in places like Toronto or the surrounding area. You're paying a premium on in terms of the price you're paying for these buildings. And lenders still have their criteria, their strict criteria in terms of what they will lend on these properties so that that difference between the purchase price and the the mortgage balance is sometimes significant, that a vendor take back mortgage allows a person to purchase the property at that price, but still get their money leveraged properly. Sure.

George El Masri [00:22:43] So you mentioned that these voters are in second position. What are some of the rates that you're seeing on on these? I know it depends on the amount and all of that, but maybe if you could just give us kind of like some general figures that you've been seeing in the last year or so.

Cliff Ford [00:22:56] Yeah, I would say on average, those BTB mortgages are getting about three percent interest only. That's that's sort of the average we've been seeing lately. And I would say that that's been a trend for maybe the last decade, you know, for voting anywhere between three percent and four percent. OK, what we have found in some of the some of the buildings that we've sold, if there was a repositioning that was needed for the property, for whatever reason it was run down or they had a bad tenant profile, a lot of times those the buyer needs a bit of time to reposition the property and really take over and institute their own principles and how they're going to run the property. And so the VTP mortgages in those cases sometimes will become scaled. So they might start off with the first year being zero percent. So that allows the cash flow to be there for this person, the new buyer, to to take over and start running the property and then know the first and second year they would start to incrementally increase and, you know, finish around the four percent on the in the final year of that term. So sometimes there is a scale to the VTB, but on average, I would say we're seeing about three percent to be the going rate on those second mortgages.

George El Masri [00:24:12] OK, and what about the amount? Is it usually like a smaller amount that you're you're getting a second position VTB on? Is it like five percent of the purchase price, 10 percent? Or are we talking about 30 or 40 percent of the purchase price?

Cliff Ford [00:24:30] I would say just to sort of as an average rule of thumb, it usually ends up being about 10 percent of the purchase price. And the reason for that is especially, like I said, in the GTA and in larger markets throughout Ontario, you know, based on lending values and and the purchase prices, you're getting a buyer that's coming in with, say, 40 percent down to their first mortgage. Yeah, well, somebody most buyers don't want to leverage that amount of money when they're purchasing a property. So that extra 10 percent on the VTB. Now, all of a sudden, they're only having to put in 30 percent or 40 percent. So that's that's how that happens. Yeah.

George El Masri [00:25:08] And so you guys are you guys find that the sellers that you're working with are OK with only earning three or four percent as a second position mortgage typically.

Cliff Ford [00:25:19] Yeah, because they're getting the the other terms that are important to them, whether that's, you know, the closing date they want or the purchase price. Sure. They're usually OK, you know, they're not looking to to get wealthy off of the vendor back mortgage. Really the benefit to the seller is that they're delaying their capital gains on that that portion, right? That's right. That fund. So that's really the benefit to them and the reasons why they will often entertain a vendor take back mortgage. I've sold a couple of properties in the last year where an owner was retiring and in those cases he was actually able to do a full first mortgage as a vendor, take back mortgage because he was just trying to defer as many capital gains as possible for the next five years. Sure. And by offering a first mortgage, you know, again, it wasn't about the interest rate, but it was about, you know, what he could get to facilitate the deal.

George El Masri [00:26:14] Yeah, it makes sense. Like in that example, perhaps he had, say, 10 buildings and maybe he did a building like for the next 10 years. Each one the the VTP will mature at that point so that he can sell them off slowly and not have to pay capital gains on the entire amount.

Cliff Ford [00:26:30] Exactly. Yeah. He stated he's staggering when he has to pay the tax man.

George El Masri [00:26:34] Yeah, exactly. OK. In terms of the properties that you're you or your clients are buying or whatnot, what are some of the value ads that you guys are looking for today to maybe potentially refinance it soon after or whatnot?

Cliff Ford [00:26:49] Yes, certainly. You know, the biggest one out there and this has been the case for years now, but even more so prevalent in the last year or two, upside in rents is certainly the number one value add. You know, we will look at a property and we'll analyze each unit in terms of what the market could bear on a rental figure. And we'll we'll analyze that and put that into a report for a buyer to say, here's your snapshot of what you can achieve as you move those tenants out. Now, some of the buyers that we work with, they go in and they're aggressive. They'll do the, you know, cash for keys type of approach where they'll buy out tenants. But the majority of the buyers that we deal with, they take it more as a natural effect. As people move out, they know what that upside is and they can buy and hold for, you know, a number of years until they've they've turned over those units.

George El Masri [00:27:43] Yeah, because typically when buyers or when somebody purchasing a 40 unit building or whatnot, the buildings already typically cash flow positive right from the start. So they're not feeling the pressure of having to replace those tenants, you know, otherwise, like, I don't think you can get financing or whatnot. So it makes sense that you would be patient, just wait for that natural thing to happen. Yeah, yeah, yeah.

Cliff Ford [00:28:08] And, you know, there's other there's other upside, you know, outside of just the rents, you know, a lot of the owners these days are looking at utility consumptions. How can they cut back on their hydro water heating costs by, you know, investing some dollars into the into the property to do a toilet replacement program or convert all the lighting to LSD? You know, investing in high efficiency boiler systems for for larger buildings, you know, that's all trying to capitalize on the upside in their their utility consumptions. Some of the other things we look for, we look for extra space in a building. You know, a lot of times these this older stock of apartment buildings have ground floor space. There was just never use or maybe at one point it was used for storage lockers and the tenants just don't use it anymore. So we look at that, we say, you know, could something be done there to to add an additional unit? You know, all of a sudden you're going from a 40 unit building to a 41 or 42 unit building for a fraction of the costs that it takes to to build those.

George El Masri [00:29:15] Oh, yeah, definitely. So you're touching on the utilities. Do you guys look for opportunities to separate the meters? I know older buildings. Sometimes you can't. It's very difficult to separate gas meters or. Maybe water meters or whatnot, hydro is usually the easiest one to do, but you guys look for those opportunities or do you do you typically just leave the gas and water?

Cliff Ford [00:29:39] No, we do. We do look for those opportunities. You know, certainly there is there's a benefit, you know, in terms of your purchase price if you're if you're doing those types of efficiencies. I sold a building in Oshawa back in October and that particular one, the owner had bought the property two years prior, and that's exactly what he did. He went in there and he converted all the utilities over to smart metering. In this case, it was electrically heated. So he had no gas in the building. So it was just hydro and water that were smart meter, but that, you know, turned around for him to have a significant increase in his net operating income when he converted that over. And that's why within two years he was able to to go out and sell it for a significantly higher amount.

George El Masri [00:30:28] Yeah. So when you say smart meter, is that one of those, like, electronic boxes that gets installed in, then basically the utilities are controlled by the company that installs the smart meter box.

Cliff Ford [00:30:41] That's right. Yeah, yeah, yeah. So you know, when it comes to hydro, you can do the individual hydro meters and I'm sure you've seen those, you know, that requires a significant amount of space. If you don't already have that space in a hydro room, it may not be feasible, but the smart metering allows you to get the exact same effect, but with a smaller footprint of equipment.

George El Masri [00:31:04] Sure. Yeah, there there are some some benefits, too. Like I know it could take. I mean, there's a procedure involved with getting hydro meters installed. I think sometimes even they have to verify that the the street has enough service to to service the additional meters, whereas the smart meters, you don't have to go through that entire process.

Cliff Ford [00:31:25] So depending on the size of your building, those smart meters can also be a revenue generator because some of these companies will actually give you incentives and provide you with an income source for what they collect from the tenants. Cool.

George El Masri [00:31:41] Yeah, that's awesome. So we touched on Whitby's we touched on value add opportunities and your database and all that stuff. Now, if we wanted to talk about some maybe like coin op machines and all that, we've we haven't touched on those. Is that something that you guys will always install in your buildings or is that a case by case basis?

Cliff Ford [00:32:09] We will always put in laundry machines in any buildings that we have. We do find that it is a consistent income generation. It's it's not significant, obviously, in comparison to your rental income. Yeah, but obviously, when you're looking at the value of these these rental properties, every dollar is that you can gain is going to give you significant dollars in return. And so we look for any opportunity. And certainly laundry is one of the obvious choices to bring in. Now, I would say we're sort of split between buildings that have laundry that's owned and its coin operated. So we have people actually having to go and collect coins, these properties. And then we have some buildings where it's on contract with a company, for example, coin, animatic, where they they take care of all the maintenance and they take care of all the payment processing and then they just give us a portion of that every month. Yeah. So it really depends. You know, we find that the larger buildings work well with with a contract basis for laundry, whereas our smaller ones, it's nice having those coin operated ones because you've got now you've got some some coins to collect and you've got a little free cash flow that way.

George El Masri [00:33:26] Yeah, definitely. Have you guys had any experiences with electronic collection for coin operated machines as opposed to like physical coins?

Cliff Ford [00:33:37] Yeah. You know, when you when you work with some of these laundry companies, Phelps kinematic, whoever it may be, they often have the card readers where tenants can load up, you know, funds from their bank account onto their card and then just use the card that really works well for larger buildings. Any of our buildings that are sort of eighty units and above, we will put in the full card system, because when you've got, you know, seven, eight, ten laundry machines there, you don't want to necessarily be collecting coins to that that amount. And obviously there's liability there that it's something that could be stolen. Sure. You know, whereas they can't steal an electronic card.

George El Masri [00:34:18] Oh, yeah, definitely. Yeah. OK, that's great. Yeah. Is there anything else that we missed or that we didn't touch on that would be important to share about. Maybe some of your procedures or some of the successes you've had with multiple units.

Cliff Ford [00:34:33] Mm hmm. You know, my advice to anybody who's who's getting into investing in apartment buildings, my focus is always on doing proper due diligence. So you can never ask too many questions. You can never dig deep enough or too deep for for finding information about the property. You know, from us at Skyview, what we try to do is answer every particular question that could arise on a building right from the beginning. So we'll collect documents and we'll scan everything into a package that's available for the purchaser. So at the end of the day, they know exactly what what it is that they're they're buying and what they're getting their money's worth for.

George El Masri [00:35:16] Definitely. And on that note, with the due diligence. So assuming that I don't know, let's say you have a 40 unit building, you might have maybe one or two tenants or whatnot that are not paying the rent, that are taking advantage of the landlord tenant board, freeze evictions and whatnot. Is that something that if you are representing a buyer and you want to make sure they're protected, how are you ensuring that you're finding out about these sort of cases before moving forward?

Cliff Ford [00:35:46] So that's that's one thing that Skyview does and has done for four years. We get right at the outset when when an agreement is is drafted up, we describe exactly what needs to be delivered from the seller to the buyer and vice versa. And it's all laid out right in our agreement of purchase and sale. And one of those items is what we call the tenant status report. And it's a spreadsheet that looks at a snapshot of all the tenants when they moved in, when there are increased dates or do if they've got any arrears and how for how long. And that that one document gets updated throughout the sales process so that because sometimes, you know, these deals will take three, four or five months to from start to finish. And a lot can happen with tenants during that time. So doing that tenant status report at the beginning with the agreement and then at the end of due diligence period and just before closing, allows us to track and disclose to the buyer exactly what they're what they're getting.

George El Masri [00:36:48] Awesome as school does. The tenant usually sign that document, like fill in their information and sign the document, or is that exclusively done by the seller?

Cliff Ford [00:36:57] This particular one is is done by the seller. It's it's sort of their declaration of what the tenants are are like. Yeah. What we will do just before closing, usually about a week or two before closing is we'll go and get tenant acknowledgments done. And that's where the tenants are actually verifying what they pay, how long they've lived there. You know, what parking spots they have if they pay for their own hydro or water or whatever, all that gets done, unintended acknowledgment. So if on closing, let's say, for example, you've got an owner, he only has thirty five out of the 40 units he actually has leases for because they're older tenants or, you know, maybe he didn't get them when he bought the property. Those tenant acknowledgments work as sort of a replacement for a formal lease to understand the terms.

George El Masri [00:37:45] Yeah, absolutely. Yeah. OK, perfect. Cliff, I appreciate you sharing that. We're going to jump into the next section, which is the random five. All right. All right. So I'm going to ask you five or ten questions and you just tell me the first thing that comes to mind. Sounds good. Our number one, if you had to change your name, what would your new name be?

Cliff Ford [00:38:05] You know, I think I would go with something like Jay or something like that that, you know, initials rather than name, you know.

George El Masri [00:38:14] Oh, yeah, cool. OK, yeah,

Cliff Ford [00:38:15] I used to j back in the day, so maybe that's way too

George El Masri [00:38:18] nice. I used to deejay too. That's funny. Yeah. Yeah. Number two, why do we dream.

Cliff Ford [00:38:25] I think humans were built as storytellers and creators, and I think it's our minds way of telling a story to entertain us when when we're turned off for it for rest and relaxation.

George El Masri [00:38:36] Cool, cool. Yeah, I like that. OK, three. When was the last time you acted nonchalant? But we're going crazy inside.

Cliff Ford [00:38:44] I think that's almost every day know as this lockdown goes on, I feel like, you know, we're all just sort of doing what we can to act like everything's good. Yeah, we're all getting a little stir crazy at the same time.

George El Masri [00:38:57] Oh, yeah, definitely. No. For what song do you have to sing along with when you hear it?

Cliff Ford [00:39:03] Oh, wow. That's a great question. I've got an entire playlist of about 25 songs that I call my go to karaoke list. And so if I'm driving in the car on that, that, you know, that playlist and just put it on random and sing the entire entire time.

George El Masri [00:39:20] OK, there you go. Twenty five songs, not just one for you. Oh no, no. Yeah.

Cliff Ford [00:39:24] I love singing. So yeah.

George El Masri [00:39:27] Number five, what success principle do you live by.

Cliff Ford [00:39:32] You know, I think the most important thing to me is having integrity, you know, I think if whatever you're doing in life and in my case, I chose to enter the multi residential field, no matter what you do, if you're doing it with integrity and you're true to yourself and how you treat others is done with integrity, you'll succeed in whatever you put your mind to.

George El Masri [00:39:55] Yeah, absolutely perfect, Cliff. I like everything you've shared today. I want to ask you, how do people reach you and what services do you provide?

Cliff Ford [00:40:05] Yeah, absolutely. You know, people can reach out to me by email at Cliffe at Skyview Realty Dotcom. They're also welcome to visit our website to to learn more about us and see properties that we have available at Skyview Realty dot com. You're there. Also, welcome to reach out to me. My cell number four one six two seven seven four six three seven. You know, anybody who's interested in getting into to this particular field, whether it's as a buyer or as a salesperson, I'm always happy to discuss the industry with them. And certainly if they're looking to purchase properties, I can put them on my distribution list so that they see as properties become available that they get an alert right away.

George El Masri [00:40:48] Awesome. Great. Cliff, thank you again for your time and for sharing all this stuff. And I hope you'll enjoy the rest of your day.

Cliff Ford [00:40:56] Thank you so much. It was great speaking with you.

George El Masri [00:40:58] All right. Take care.

Cliff Ford [00:40:59] All right. Bye bye.

George El Masri [00:41:01] Thanks once again for listening to another episode of the Well Off podcast, just want to remind you that if you do appreciate the content, all I ask is that you comment, maybe like it if you can, on the platform that you're listening to it on and finally share it with friends and family. I'd love to get the message out there and it would mean a lot if you can share it. And finally, I just wanted to offer you as a valued listener, a free copy to the roadmap to real estate investing, which is a document that I've put together which helps you identify what strategy would best suit your needs at this current time. You go over certain things that are included in this document step by step, and it'll hopefully provide you with some clarity. So have a look. You can go to w w w well off Dasia Forward Slash Guide to download your free copy.

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