Listen to the Podcast Here: Podcast Episode by Jason Lee – Premiered June 9, 2022
What You’ll Learn in the Podcast:
- A look at Sunil’s background, what made him decide to quit his job for real estate, and how he first got started in the field.
- A look at the amazing amount of deals Sunil has done and the number of units he currently has.
- Why managing your taxes, and tax insurance, are an important part of investing in real estate successfully over the years.
- Why Sunil chose multifamily as his niche and information about his unique approach to doing it successfully.
- How Sunil sources the properties that he invests in.
- Strategies that Sunil uses to source capital for his numerous investments.
- Information about Sunil’s background as a broker and how that informs what he does today.
- How does Sunil keep his salespeople motivated and happy? – Where is the market going to go in the U.S. in the coming years?
Summary and Highlights:
Sunil Chillar worked previously as a vice president for a financial brokerage house in New Jersey. He started his career in real estate when he was walking with Tony Robbins, but now became successful and has his own company in the real estate industry. He took a series seven and a real estate license. However, he failed to get one for real estate.
Sunil knows that he isn’t the type of person to fail at things. He attended a seminar and discovered how real estate investing can achieve wealth and financial freedom. He was aware that he cannot purchase properties that cost millions of dollars, but his mindset is focused on what he should do to make it happen.
He connected with different investors to do SEC-compliant actions. Since he has the skill to take a property down, he has purchased investments and acquired properties that are under management. Sunil was able to purchase around 300 personal properties and a thousand with his investment partners.
Experiences in Investing in Real Estate
One of his experiences was the rising trend of tax insurance. He believed that this is the key to acquiring properties.
As a partner in investing, his priority was to keep the cash flow going for his partners. Once a property is bought, there will be very minimal cash flow going. But once it is fixed for damages and works from the interior and exterior of a house, they can increase the rent amount.
These houses will eventually be put up on sale to provide profit earnings for him and his investors. Rent payments from the tenants can be used in paying the mortgage and bills.
Wrong Practice in Real Estate Investments
People risk investing in a property without knowing if it can provide a good cash flow. They only increase the rent to sustain the expenses and earn.
Multi-Family Real Estate
If you can buy properties with multiple units, you should not have a reason not to do it. This is the game of real estate.
Sunil looks for these kinds of deals by connecting with people who can give him more deals. Also, by being in this industry for so long, he already had a lot of connections where brokers called him to give additional properties.
How He Raised his Capital
Raising money for business has always been hard and needs constant engagement with investors. With the help of his parents who focus on assets, he was able to focus on finances. Managing these properties is done by his professional management team.
He was focused on finances because he believed that when you have money, deals will be coming to you automatically.
Advice for Beginners in Real Estate Investments
When you are planning to invest in a property, get a mentor who has made mistakes but was able to turn them around. Someone you can trust and who has experienced both ups and downs of real estate investment can guide you in preventing investment losses.
There are chances that you may lose a certain amount, but if it reaches thousands or millions, making mistakes should not be part of your investment plan.
Episode 48: Real World Advice On How To Maximize Multifamily Investing To Great Heights
Watch the Podcast | Read the Transcript
Welcome to the Multifamily Millionaire Podcast, the show that interviews multimillionaire real estate investors and top producers in the real estate industry. If you’re looking to create passive income and achieve financial freedom so that you can do what you want whenever you want, you’re in the right place. Our goal is to simplify and make real estate investing easy for you. For more information, you can find us at www.jlm.realestate.
Jason Lee: Hi everyone. Welcome back to the podcast. This is your host, Jason Lee. And I’m here with my friend Sunil. Sunil. How are you doing today? Good to have you on.
Sunil: Doing well, thank you for having me.
Jason Lee: Of course. It’s a pleasure to have you, you got a great story of a very amazing track record, so I’m glad to have you on. First question I want to ask you is, can you just tell the listener more about who you are and your story?
Sunil: Absolutely. Started doing real estate 21 years ago. Right before that, I was a VP with a major financial brokerage house here in New Jersey. And got into the real estate side of things after walking on fire night number one with Tony Robbins, which was pretty cool. Walked back into my job and gave my two weeks resignation, gave my notice. I was done, jumped into real estate, and really never looked back. Along the way I have opened my own company. I’ve been buying and have been flipping for the last 21 years and you know, started doing multi-family within the last maybe two years or so. And things have just taken off on the flipping side of things. I’ve just been busy for the last 21 years as well which has been great. So, I’m pretty happy, pretty busy.
Jason Lee: So, Sunil, how did you first get into real estate?
Sunil: It’s funny back then I took my series seven license and for whatever reason I decided to do take my real estate license at the same time, which was stupid of me. So, I passed my series seven and failed my real estate license and it just haunted me for a couple years. You know, why don’t I just go back and take it even if I did nothing with it, because I’ve really never failed at anything, or at least given up on anything. And went back a couple years later, took my real estate license and at the same time, like I mentioned, you know, I met Tony Robbins in the inception of having a real estate license, maybe a year or so into it. I did Tony Robbins up here in New Jersey. And like I said, I walk on fire that night, number one, and it just flipped the switch in my head.
Yeah, we always have a, a background of where we came from. You know, you buy within your means, or at least that’s all your parents teach you to do, right? You are not looking to overspend. And so, thinking about it, you know, you drive past, let’s say a 1,500 unit, hey, I would never have the money to buy one of those things. Or at least that’s what plays out in your head because you’re talking a couple of million dollars to purchase one of these assets. And walking on fire just changed that mindset of, you know, rather than when I have the money, I’ll buy it, which will be never unless you win the lottery. Or what do I need to do now in order to make this happen?
You have so many other people out here who are acquiring these assets and you would think, if you really don’t know, my God, they may be rich or rich family or what have you. And it’s really, you never, unless you don’t know syndication, simple, you know, just getting a bunch of investors to get everything that we do. Obviously at this point in time is SEC compliant cause we do syndicate, but just having that piece of knowledge there is that ability to take these properties down. So here we are. And now taking these properties down.
Jason Lee: And you’re being humble, how many investments have you successfully purchased and how many units do you have under management?
Sunil: Like I said, I’ve been doing this for over 21 years. On the smaller side of change, I have bought personally over 200 or 300 properties personally. On the bigger side of it, on the investment side with my partners, you know, with them, a couple of thousand units.
Jason Lee: And what have you learned from those experiences?
Sunil: Number one, that you got to look out for taxes, cause taxes always go up. In today’s environment Taxes, insurance that’s key right now, you know, in acquiring these properties, obviously everything that we buy is a value-add component because one of the things that we want to do, and we are successful in doing is we want to give our investors monies day number one. So, the properties must cashflow.
It may not be working optimal right today when we purchase it, but the goal obviously is within the next couple of years to have that value art kick in where you are, number one, you know, fixing the apartments. Let’s say you do work on the exterior, do work on the interior, raising the rents, and at the end of the day, three-to-five-year hold, you want to sell that asset and obviously make a profit for you and your investors. So that’s the typical play, which everyone obviously knows about, and majority will do.
So, you’re looking for mismanaged properties, you’re looking for properties where it’s run by mom and pop. And we have seen a lot of times exactly that, where we all get older, right? We all get tired, and you know what? There’s an ample number of talents, let’s say, where the money’s being generated from. Rents is enough to pay the mortgage, it’s enough to just cover the bills, and those individuals are happy. So, it’s not optimally being run. So that’s where we’d come in the end, you know, do what we need to do. That’s where the money is.
Jason Lee: Got it, got it. Yeah, I mean that strategy, I mean, you can’t really fail because there’s a lot of upsides and you’re buying with cash flow. And I know a lot of people who are a little riskier and buy properties that are, you know, not cash flowing and then they try to, you know, up the rents to eventually start making money on the upside. But I think if you start with cash flow and you’re, you know, increasing the rents over and over can’t really lose. Why do you focus on multifamily real estate?
Sunil: Simple question. Easy question. If I buy one profit key a month, let’s just make that assumption right now. If I buy one property a month, which is a lot of work in rehab and doing what you need to do in order to flip the property. But if I buy one a month, I could only buy 12 of that a year. Depends on, you know, finances obviously and capabilities. But let’s make the assumption I buy 12 property a year. If I buy one 50 unit or one 100 unit, I just scale my business tremendously. So, it just makes sense. If you know what you are doing, number one, and if you have the capacity and capability to do it, why shouldn’t you do it?
Again, just scaling and flipping on steroids if you will. That’s what the game is and that’s what we do.
Jason Lee: Very cool. So how are you finding these opportunities? What are you doing to source these deals that make sense for you? Cause obviously your underwriting’s very conservative and you have a very strict investment plan. So yeah. How do you source them.
Sunil: Two ways. Number one, I belong to a mastermind group where there’s a lot of individuals like me throughout the country where who have deals, number one. So, people always call me putting things on my lap. Secondly, because I’ve been doing this for so long and I’ve made so many contacts with commercial brokers, they constantly call me as well, just, you know, putting additional properties on my lap. So, it just becomes a matter of duly underwriting, making sure it makes sense, number one. And going after them, again, it’s a highly competitive market right now.
We tend to see now a lot of hedge funds make next to nut and cap rate just because they want to deploy money into the market. And that’s been sort of hurting everyone, but what are you going to do? It is part of the game, right?
Jason Lee: Yeah, definitely. Do you see that competition slowing down in the near future, or do you see it being pretty steady?
Sunil: It’s pretty steady. There are a lot of foreign monies also coming into the playing field here. So, a lot of countries right now, just again, like hedge funds, they just need money in the US, what are they make next to nothing that’s okay with them because they got plenty of money. So, if you guys are like those companies out here, please call me. I can use some of those money.
Jason Lee: And how have you successfully raised your capital? You know, obviously when you are first very hard, what’s your method for raising money?
Sunil: It’s always been hard. It’s a constant, it’s a job, if you will because you constantly need to engage investors. You know, one of the things that I’m doing with, with my company and a couple of other places is exactly that. I’m focusing more so on the money part of it while my partners are focusing on the asset itself. Whether it’s finding the properties or when it comes to managing the properties. We have, we all use professional management companies. We do not self-manage. So, our role is basically manage our managers. But right now, what I’m doing is focusing solely on the money aspect of it. Like anything else, if you have the money, the deals will come. So, you really don’t need to chase after deals out here. And at that point, you know, you could do a whole lot bigger deals, and that’s really more so what I want to do.
So, we’ve been successful so far, but I think we could do better, and we need to do better. So, I’m focusing on the money part.
Jason Lee: And how are the systems of your business? Do you have any, are you the sole owner? Do you have any partners? A lot of employees.
Sunil: We do have partners. In this multi-family space, you could only do so much if you are one individual unit. There’s a lot of movement pieces, especially, you know, the due diligence part of it. The underwriting, you need boots on the ground, there’s a lot. And if you want to do this by yourself, you fail. It’s a team sport and you got to honestly know who your team players are and make sure everyone, you know, is strong and brings something to the table, but you really successfully, you really could only go so far if you are just one individual. So yeah, we are a bigger team. So, we have specific roles. We all help each other, obviously, but yeah, team.
Jason Lee: Nice. Switching gears, a little bit, you’re also, you’ve also been a broker for a very long time. Can you tell us a little bit about your brokerage career?
Sunil: Been a broker now for God, 16, 17 years. Like I said, I, I own my own company which is an exit Realty Urban Living exit realty franchise which is a great phenomenal company. Something that I’ve done, and I do here, is I tend to push people’s boundaries because I’m pushing my own boundaries. You know, if you are comfortable, it doesn’t matter where in this world you are, if you are comfortable in whatever you are doing, I don’t think you’ll ever be successful. You should always be uncomfortable, you should always be growing, you should always be pushing yourself. And I do that with my guys and it just, it annoys me at times where you speak to others, and you see potential and you see nothing is happening. The drive first, you know, other individuals at times aren’t here. But I’m the one who always challenges everyone, and I challenge myself.
Like one of the things that I’m doing personally is I’m scared of heights. I am so freaking scared of heights. It ain’t funny. I’m actually taking flight lessons because I want to fly. I want to get my pilot’s license. So, I’m in an uncomfortable space flying. I’m getting more comfortable as I progress. But again, it’s taken a little bit of time. It’s a challenge like anything else, but I’m getting there. And I do that, like I said, with everybody because if you’re comfortable, you know, success and failure is just really a very fine line, and we all need to push ourselves. So, you know, I’ve come from a space where, you know what I come from nothing. I have literally come from nothing, and I have what I have, and it scares the heck out of me to even think about it and go back here brings perspective, but it’s not a place that I’ll ever want to be in my life again. And that’s why I push myself and I drive myself as hard as I do. And I do that with others as well.
Jason Lee: It’s an amazing answer. Yeah. One of my favorite lines is find comfort by feeling uncomfortable. You got to find comfort in that. And I believe that more than anything. How do you currently motivate your salespeople at your office?
Sunil: You know, It’s a constant challenge. It’s a very constant challenge. But, you know, one of the things that I’ve done is show them my vision. Show them where the money is and just push. Like anything else, you got to military people like, you know, like, just like you have your kids, you got to constantly push them, motivate them, and but sometimes you got to scream at them, right? It’s just part of what it is. Something that just changed a little bit on a more personal note, one of the things that something I’ve done very well for a very long time is failing forward and that have actually propelled me very successfully in where I am today. And at this stage in my life, I need to fail faster at this point in my life, which means I need to grow faster by learning more as I go along and I tell this to everyone, you got to fail faster.
Jason Lee: So yeah, I mean, I’m a firm believer of that. If you fail over and over and you don’t quit, you’ll become successful, right?
Sunil: Correct. [15:30 inaudible] and part is key here. Definitely got to get back, shake yourself off, get up, shake yourself off and move forward. You need to learn from it, obviously. Yeah. You got to get up and do it again.
Jason Lee: Can you tell us about a time where you failed in something in business or personally and you learned from it?
Sunil: I have failed so many times, which is a good thing, which is never a bad. One of the things that I’ve done, which I’ve failed at, it was my very first multi-family deal. Huge 16 million deal. Failed the close on that deal for a couple reasons. One being the money part, the money raising part of it, but more so we had a huge issue on the seller’s side where they actually made the waters very murky. So, we actually backed out of that deal. But one of the things that I’ve done successfully, that I did not do successfully here was every property that I purchased, I buy cash. I’ve always bought cash. And every property that I’ve purchased, the cash was already in the bank. In multi-family, obviously through syndication you raise money, and we were raising money. Like I said, the money, the waters became muddy cause of certain things that a seller did.
But looking on my side of that equation, I did not raise enough money at the same time. So, with that being said, I’m looking at past successes that I’ve done, which was having the money in place and moving forward, I am making sure that, you know, raise enough money, have it in place. So, when the time when we need to pull the trigger, the funds already in the bank and there is no, oh my God, I’m short X amount of money. And you at that point, scrambling, bagging, barring, and stealing to get it done.
Jason Lee: Yeah. That is a great story. This is a question I’ve been hearing a lot. I know it’s a tough question to ask, but where do you personally see the market heading in the near future?
Sunil: I think you know, right now, obviously we know prices throughout the country have just shot up. People still buying the feds obviously raise their interest rate to sort of slow things down or slow at least the form prices from going up. I think we will not have a crash, but I think we’ll have like maybe a small correction. Like anything else, people need a place to live. You know, even when the market crashed back in oh 6, 0 7 people still, we have definitely had a correction. Yeah. But people still needed a place to live. That’s never going to change. You want to buy, and that’s why, you know, we have put in many offers on many properties, and we were outbid it many times. We have the capacity to raise our offer and we decided we are not, because there’s always going to be properties on the market that’s a given. So, because of our conservative underwriting, we choose not to just chase after the property. So, I’m actually hoping there’s a small correction because we are poised to buy and just want to buy right. So, we be very careful, like a lot, I’m sure a lot of our investors out here. But we are definitely buying, and we have before.
Jason Lee: Definitely. I mean, yeah, I mean that’s why I like multi-family because you know, not everyone needs somewhere to place their business like in retailer office, but everyone needs a place to, you know, lay their head at night right when they go to bed. So yeah, multi-family is definitely the best asset class in my opinion. I know before the show we were talking a little bit about the locations you invest in. Can you tell us about why you invest in those specific locations today?
Sunil: So, we tend to invest in landlord for any states, number one. Obviously, you invest in bigger communities, or like I said, all value-add properties, right? So, we want to stay within at least one hour for major international airport. You know, we look at the [19:52 inaudible], we look at obviously the statistics on our census to make sure the population is increasing. So those are certain guidelines. We want to make sure that, you know, we are maybe in a class if we could get a B property in a C neighborhood and that whole, that whole area is transitioning, obviously we want to be there as well.
One of the key tools that we have in our disposal is we actually have a demographer on my team. So, we actually know where the part of the progress is taking place, and we try to be the first or the second in those locations because at the end of the day, we want to sell. So, we want to get them as early as possible where, you know, we able to increase the NOI, increase the value of the property and sell it. So again, us our investors make a profit. And at the same time, you know, we want our tenants to know that, hey, we are not just buying this to make money, we are also raising the value of the property by doing work for the property. So, they have a better experience as a tenant, as a renter that you know what, my god, this is home. This is a greater place than when, than the last owner, let’s say. So, we definitely want our talents to be happy with everything that happens as well. We strive for it.
Jason Lee: Fantastic. Before we go, I just want to ask you a few last questions Sunil, any word of advice from someone who is a beginner real estate investor?
Sunil: Sure. Pull me up, I’d love to guide you. Something that I think everyone should have is a mental, especially when you get into this, you should, you should be able to latch onto someone who have done it before you, who have made the mistakes before you, who have walked through those financial landmines before you. And who could guide you, someone you could actually trust, because you know what, one or two body punchers and you will go down, you know, this is a game where money’s a big, you’re not talking about maybe 50 or a hundred thousand, which is still a whole lot of money, a whole lot of people. It is a conservative amount of money. But when you are talking, you know, hundreds and hundreds of thousands or millions, you cannot afford to make mistakes. And especially if you can have investors or people who, or friends and family who you know, who believes in you, who lends you money, you want to know what you’re doing because you do not want to create enemies or break friendships or worst-case family destroy families and destroys people’s wealth and hard work. Don’t want to do that. So have someone you can rely on, someone you on, on someone who has been here before you.
Jason Lee: Amazing advice Sunil, thank you so much for all the time and wisdom. Before we go and ask you one last question if the listener wants to go learn more about you, how can they do so?
Sunil: Absolutely. I will give you my cell number.
Jason Lee: Oh wow.
Sunil: I love to speak to people. I would love to help anyone. My cell number, 2019540292. And I will repeat that. 2019540292 for me anytime.
Jason Lee: Sunil, you’ve been a fantastic guest. I really appreciate you being on the show. Last question before we go is, what is your favorite thing about being a real estate investor?
Sunil: You know, what the hunt, the hunt for the property. Just then, the challenges. Listen, we could look at everything as problems, right? Or we could turn them into challenges. So, it’s basically the challenge to hunt for the property. The part of, you know, just making it happen. They can deal, you know, making it happen across the finish line. Just getting it done. It’s exciting. It’s a great business to be in.
Jason Lee: Never gets old.
Sunil: Never. There’s always something unique, something different. Yeah. Yeah. Love it.
Jason Lee: Couldn’t agree more. Thanks so much for your time, Sunil. It’s great having you on the show.
Sunil: Thank you. I appreciate you having me on.
Thank you for joining us on the Multifamily Millionaire Podcast, the show that interviews multimillionaire real estate investors and top producers in the real estate industry. We’re here to help you create passive income and achieve financial freedom so that you can do what you want whenever you want. We’ll catch you next time on the Multifamily Millionaire.
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