Matt Faircloth of the DeRosa Group buys ugly on purpose: C and D class value add, bought cheap enough to cash flow while he owns them. On this episode, host Abel Pacheco and Matt find the niche the big players cannot touch.
In this episode:
- The buy box: "the kind of stuff we buy makes money during ownership, because we buy them affordably enough that we can cash flow while we own them."
- The niche math: institutions cannot staff on site payroll under a threshold, "the magic number on payroll is typically around 80 units," so "there's less competition in the 10 to 60 or 70 unit space."
- His non negotiable at that size: "I would only work with a property manager that has in house maintenance," or you get marked up labor and you are not the priority.
- Aligning interests: he made a property manager an owner, moving their profit from management markup "to the bottom line where I make money too."
- Why every point here is an expense side point: control the operating line and you control the deal.
Abel Pacheco is a San Antonio real estate operator who went from 8 single family houses to a share of roughly 1,500 apartment doors, and now works as a fractional Chief AI Officer helping small and mid sized businesses put the back office on autopilot.
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