[00:00:00] Kristen: Welcome to this week’s edition of Insider Secrets. The show that turns multifamily investing into reality. Each show we interview guests who are seasoned professionals, actively closing and managing real estate deals. Your host Mike Morawski has more than 30 years of multifamily, real estate investing and property management expense.

Mike is the founder of My Core Intentions. And he’s been involved in over $285 million of transactions. Focuses on helping you create short term cashflow and long-term wealth. Here’s your host, Mike.

Mike: Good afternoon, everybody. This is Mike, your host for Insider Secrets. I don’t know if you saw this morning, but I did a post on LinkedIn and on Facebook and it talked about [00:01:00] thinking differently. And I think that if we don’t start to think differently in our lives, that we get stale and we get stagnant, we don’t move forward.

Today, My Core Intentions wants to bring a guest forward that thinks differently and thinks outside of the box. Our intention at My Core Intentions with our clients is to help them and educate them to teach them and help them grow, to learn, to be more disciplined in their investing, in their strategies and how to create short-term cashflow and long-term wealth.

If you’re looking for some direction, if you’re looking for some help and some guidance, how to build a stronger plan, how to execute better and how to live a balanced lifestyle, give us a call. There’s only a couple of weeks left before our three-day virtual event that multifamily global summit.

I hope that you’ve reserved your seat. I hope that you’re going to be there. And if you haven’t, go today and reserve your [00:02:00] seat, make sure you’ve signed up and bring a guest. You won’t want to miss any of this event. Actually, our guest today will be a panelist on that event as well. I’m excited about our guest today.

I’m joined by my friend and real estate investor, Alina, and she is the founding and managing partner of Sammo Financial. A boutique private equity firm that helps us select group of people passively invest in commercial real estate. For over six years, she has been an equity partner in various multi-family private placements nationwide.

Her business model has been articulated through Warren Buffett’s philosophy that someone is sitting in the shade today because someone planted a tree a long time ago. Her passion is to teach others how to build wealth. Alina is the founder of two meetup groups. We will talk to her about these groups.

One is educational [00:03:00] webinars and collaboration for various administrators and self-directed IRA companies. Her topics revolve around aspects of getting started. Investing in real estate, particularly in syndications, in the use of using funds from 401ks or self-directed retirement.

And this’ll probably be some great conversation today because I don’t know that we’ve really talked about self-directed retirement funds on the show here. Here’s something that’s pretty interesting about Alina is that her clients have acquired 1200 apartment doors. They have a couple of different funds that they’re involved with $10 million fund that’s focused around self storage and a $10 million fund that’s focused around mobile home parks. Let me get her to start to talk about her strategy and her focus. Let’s see if we can get some Inside Secrets as to how she operates and what she does. Alina, Good morning. And what I’d like you to do is say hi, and in one word, describe [00:04:00] for us you and your investing strategy.

Alina: Thank you. First of all, I want to thank you. I don’t think I ever had such an impressive introduction. You made it sound so incredibly great that I want to be friends with my myself.

Mike: That’s good.

Alina: Thank you so much. Thank you so much. I would say our strategy, one word would be transparency. We are transparent in anything and everything we do and anything and everything that happens.

I think transparency makes things a lot easier. Because when we tell people like it is, they know what to expect. We tell them about the risks involved, we tell them that the strategy we’ll propose is not set in stone. We tell them this is just proposal, don’t expect that this is going to be the case. We want to do good and make it even better.

But there are risks involved and just like there are risks involved in wall street investing, there is risks involved in real estate investing. And I want people to be fully [00:05:00] aware and be knowledgeable and educated about those guests and not coming into syndications thinking that, Hey, this is a guarantee.

They will definitely get it. Yes, we want to make it happen, but be aware that things happen. Who knew that Covid will happen?

Mike: That’s right. That’s going back to saying who knew 2001 or 2008 was going to happen.

Alina: Exactly. Yeah.

Mike: I really like your tree analogy, right? Because I’ve heard it said that there’s two good times in your life to plant a tree.

The first one was 20 years ago, and the second one is today. So hopefully we’ll give listeners some good information today that’ll help them decide to plant a tree or at least start to water the one maybe that they’ve planted a while ago. I really liked the things that I was talking about in your introduction.

And we’ve had some conversations and gotten to know each other a little bit. But what I’d like you to do is share with our listeners here today. What your backstory is? How’d you wind [00:06:00] up getting involved in real estate and were you born in a real state investor or, was it something that transpired over the years?

Alina: Sure. No, of course. Everyone is natural born real estate investor. It comes from day one. Yeah, I wish. Thank you, Mike. Again. Thanks for the introduction. And thanks for having me on your show. I’m excited about the show and very excited about the upcoming summit and I strongly encourage others, everyone who listens to the show to join us and bring their friends and family to the summit and participate, digest all the knowledge from all the phenomenal speakers are going to be on the summit.

I started my journey, my professional journey rather many years ago. After I graduated with a degree in accounting, simply because I thought that, Hey, I’m good with numbers, then accounting should be a good profession for me.

It turned out, it wasn’t the case. I never liked accounting, even when I was painful with taking all those nine courses in college and after working [00:07:00] in public accounting and then private tax accounting for a little while, I realized that I had to run away from tax accounting and find something a little bit more enjoyable for myself personally.

So I switched to the information technology world. Where I worked till this day and they’re all have been different, but they ma mainly have been around being a liaison between the business world and technology world. So I’ve been always the connector between the two, helping them to communicate, helping them to work together and helping them to move forward in the right.

And while working I’ve been obviously looking at the tax returns for my husband and I, and seeing that while we’re progressing in our career, we were also hitting, we’ve been hit with more and more taxes, including the alternative minimum tax. And I’ve been thinking about real estate because of that, because it’s one of the best strategies to Laureate your taxpayer.

So I’ve been thinking about that for a long time, [00:08:00] until about seven years ago. When I finally decided that they have to take action, we have to start investing because we need to find a way to lower taxes. And so I, then I started researching have looks for investments locally. Tri-state area, New York, New Jersey, Connecticut.

Wasn’t able to find anything viable for us. And then I decided to go out of state and as an out of state strategy, syndications came across my best. And I started reading about it and realize that this was a viable option or. Someone like myself, my husband and I were working full time. I have a family.

So this seemed like it would be a strategy where I wouldn’t be involved much and we would only have go research. They were offering upfront and then invest and do nothing after that. It seemed perfect. So after doing the additional research on a specific yeah. Operator and the offering. I finally took action and we invested in one and after the first one, [00:09:00] there was this trickle down effect where there was a second one third then so forth and then just went on and on.

And then after doing that for a while and realizing all the benefits, not only the tax benefit where, you know, you, when you do make money, but you get taxed as the capital gains. Tax level, not at the ordinary income level, which is a huge difference for higher earners. And the plus you’re getting that residual income through syndications.

I realized that this is a great way to diversify out of wall street. Not only for me personal, but for a lot of folks like myself, no one. Immediate surrounding and believe me because I’m in New Jersey and I have a lot of friends that are in financial services. I have a lot of people that are in it, very educated people that know a lot, but no one knew or heard about syndication.

So I decided that I needed to bring it. So the folks and help others to also generate that passive income and diversify their [00:10:00] portfolio and be able to lower their taxes by investing in real estate because many people want to invest in real estate, but they don’t want to deal with tenants and toilets.

And I don’t blame them. It’s not the fun part, but.

Yeah.

Excellent point. True. True. Very true. Yeah. Mobile home park only solves half of that problem. There are no toilets if they’re tenant owned, but you’re right. Storage comes in pretty handy with that. But anyway, with the storage, you still have to manage, you still have to spend the time on your investment.

You have to be in. More and more at the beginning not later on at the five to seven years, but at the beginning you have to do the beach. But anyway this was a great way for folks that have busy families have either businesses or hobbies or work full-time or whatever else just don’t want to be engaged.

It was a great way to invest in real estate and still continue with whatever they were continuing. And there. And that’s how Samuel financial was born. And I [00:11:00] started to assemble financial wisdom, purpose to plant the tree 20 years ago. And at this point that’s only two and a half years, but I’m sure it’s going to be more than that.

But I planted the tree to make sure that 20 years later people will have the tree and we’ll have the bench to see in a shape under that tree. And so that’s my

purpose. That’s about leaving that legacy, that’s a good mission and a good value, that’s what I like about you.

I’m going to just go off script here a little bit and you’ll hear we are right. Third Q3 of 2020. And talk about a couple of advantages. You referred to tax advantages a lot, but tell our listeners, especially maybe somebody who might be listening today, who is not a real estate investor yet, who’s thinking about putting their toe in the water.

Who’s just maybe going to get started or brand new, give some idea to them of one or two tax advantages and why it’s benefit.

Sure.[00:12:00] And again being a form of text professional, I obviously I haven’t invented because I understand that ax is a little better. And I, that was one of the things that I’ve looked upon when I was looking at real estate or when I look at other things as well, including both strip for me because both my husband and I have 401ks IRAs I, and everything is obviously in wall street.

The stocks, bonds mutual funds. I wanted to find a way to diversify. So that was the expectation. Number one, expectation. Number two, I wanted that investment be a little bit more tax than the advantageous than wall street, because wall street, the stacks that your ordinary income rate, and if you are in a higher tax bracket, that’s a killer.

It can kill 30 to 38% of your taxes upfront. I, I didn’t want, that was syndication. You have an advantage. And again, I don’t want to go into details of war people, but you’re not taxed on that rate completely [00:13:00] because number one, a lot of the syndications do value, adds value, adds upfront, generate losses.

So you may not even be taxed on syndications upfront in the first few years. And that’s great. And when you do get. Everything is broken down into several categories, which are taxed at a different rate and that what makes it stand out and that’s what makes it different from wall street in that.

Mike: Okay, great.

Thank you. So what was the first real estate investment you were in by.

Alina: The first one was a syndication or apartment complex. I don’t remember how many units, but it was roughly around a hundred units in, in Georgia. It was C two C plus area, and it was a C minus assets. So they operate their head to do a pretty heavy value add.

I’m still invested in that syndication. It’s doing fantastic. It’s phenomenal. But obviously, because it’s been so many years at this point, Stabilized. So at [00:14:00] this point it’s just producing a residual income for us and the dividend keep coming every year.

Mike: Residual income is good. Due to factors that I love to teach are, how do we create short-term cashflow, just money that, that comes in, that passive money and how do we create long-term wealth? So while it, while appreciation happens over time, that property goes up in value. You’ll capitalize on the back end, but along the way, you get to go to dinner or take another vacation.

Alina: Absolutely. Absolutely. Or When the is a compound interest, you generate that income.

Don’t let it sit move it into an investment account and let it generate compound interest. If you’re not active trader, just put it in. So some investment fund that’s following the indexes and have a generate compounding interest.

Mike: And that’s that diversification piece, right? So we have it here.

Can we put it here? A lot of times we can get too heavy in one asset class, but w why real estate is [00:15:00] so impacted is because it’s an alternative, right?

Alina: Exactly. Exactly. And that’s what I like about real estate, because again, From Deyvon and I can speak for myself personally because my undergrad’s in accounting.

My MBA is in finance. So I’ve gone through two business schools in my life and never in my life in neither of the schools I have ever heard about syndications. All we’ve talked about is. Stock market it’s always talk market. So all I knew from getting that education in both business schools was stocks, bonds, mutual funds, nowhere, no one ever mentioned that, Hey, you can invest in real estate, gold oil and other things.

And I think these are the fundamentals. I think people need to know. Thanks from the get-go when they’re getting educated, especially when they’re getting business school education. And that’s why I’m a strong proponent of putting that educational components into the system, even into high school system.

Not even in college, but the earlier we can start sharing that [00:16:00] information with the kids, the better they’re going to be, because it will open up a lot more opportunities.

Mike: Yeah. Unfortunately some of these things are, we’ve never been taught in high school or college. They don’t teach you syndications.

They don’t teach you real estate.

Alina: Not at all. Yeah.

Mike: I agree. I agree. I dunno. Zig Ziglar motivational speaker, for years and years used to always. Talk about the education system and how they should be teaching money management and investing to kids in grammar school and even, way back early on.

And I know he was a real advocate for it. So let’s talk a little bit about the self-directing aspect of of the retirement fund, right? I’m sure a lot of our listeners might have 401ks or IRAs or, but what about the self-directed thing?

Alina: Sure. Sure. And again, w when I speak about this things, I speak from my own personal experience because I’ve gone through it, whether myself or I [00:17:00] took my husband’s funds and have taken through it.

Again, I wanted to have a better diversified portfolio outside of wall street. And when I learned about. Ways to diversify outside the wall street was self directed funds. I immediately took action. So for someone who has a business and people don’t know about this, they can open a solo, 401k and contribute.

I don’t remember the exact number to the 53 or $63,000 per year, but again, don’t quote me on the numbers. It’s pretty high. They can continue. On the annual basis, significant amount of money to that account from the income they generating and start investing into real estate or other alternatives. Where in the world will you find?

And it’s such a great opportunity where pre-tax money can be contributed and invested from day one. So that’s one and then the self-directed IRAs also give advantage to people that maybe don’t have their businesses [00:18:00] but have the fi the ponds in their IRA accounts and just don’t know where to put it.

Don’t want to put it back into stock market. They can easily pull it into the indications and then. In real estate and then diversify further within real estate, it doesn’t have to be an apartment complex that, like we said, early, it could be storage. It would be mobile home park units, offices assisted leave and warehouses.

There are tons and tons of different assets. So sky’s the limit when it comes to diversifying your portfolio within real safe video station.

Mike: So I know that you are involved in and invest in and help others invest in different asset classes, mobile home parks, self storage. Multi-family do you have one that you really like more than another asset?

Alina: I don’t, I, I don’t want them at the meeting. The reason is because my strategy is diversification. I want to have a well balanced portfolio to me. That’s [00:19:00] important. When they find a good asset and. Strategy for that asset when they know that the, in my estimation, the investment has a great potential.

I take action. But in general, I try to take the assets that are slightly more conservative than others. And that’s the main reason why I’m at this point, at least I’m not interested in investing in the world. I might be interested in going into say warehousing because I think their houses have a future.

But otherwise I try to look for the assets that can sustain the recession and that have the ability to leave and stay on the bare minimum while we going through recession and then become a great assets afterwards, but we’ll offer that stability and we will offer it and then away.

Appreciate and value at the end and that can be sold. And, they make the money in know long. I’m not looking for quick [00:20:00] solutions. I know some people want to quickly maybe fix something and flip it. It’s just not my personal style. Everyone has their own preference and not nothing wrong with flipping, but I’m a long term buying whole investor.

And I believe in long-term strategies where you’re buying and holding it for a long time, even if it’s forever, because that’s the best way to generate that passive residual income by stabilizing the property, making sure. With functional, however long it takes. And then have it produced that residual income for you for many years to come, because that’s, at that point, you don’t really need to spend much time on it.

And it becomes a well-oiled machine that works on it.

Mike: Yeah. And that’s, a couple of interesting points there, I like what you talked about being a long-term. I remember when I first went into the syndication business and, opened a small private boutique investing firm and I’d have a good friend.

And, at that time we were [00:21:00] talking about real estate and we were talking about private investing and he was telling me about. A deal that he was involved with. And I had never known this about him. He was involved in a couple of deals with one of the world’s largest syndicators and reads today.

Read there’s a, the real estate investment trust funds. Okay. He said he had been in this deal for 27 years and I thought 27 years, my philosophy at that time was I was going to go in, do some value, add five to seven years dump out of the deal. Because we figured we’d take all the depreciation along the way and have this asset that we couldn’t do anything with any more.

So get out of it. And when I heard that he was in this deal for 27 years, it gave me a whole different thought process about how to do this. So I really think, you’ve thought a lot of things through, and I think that’s beneficial and I hope that our listeners are listening to that because it’s not just one way of doing something there’s multiple ways of doing things.

Right? [00:22:00] Absolutely.

Alina: Absolutely. And the more, the better, but I believe that the education is the key and yeah. Someone thinks that they know everything, they should continue educating themselves because you learn something new every day and it doesn’t have to be books. You can learn through experiences, your own and someone else’s experiences.

You can learn through mistakes, again, your own and other people, mistakes. You can learn by listening to podcasts, listening to books and just the adjusting or what’s going on around you and not just looking at real sales. Real was paid in silo. You have to look at the other components as to what’s going on with the economy politics, because everything is connected.

And we have to, with all of the pieces of puzzle together to make sure we’re looking at the whole picture because real estate. Yeah. Works well, but that doesn’t work in Sila. It’s impacted and maybe it’s impacted more or less than other industries, but it is impacted nevertheless. [00:23:00] But everything that’s going on,

Mike: yeah. Yeah. That’s for sure. And, talk about things that impact things. I know early on in the call in our conversation, we alluded to the fact that, Hey, nobody saw 2001 or 2008. I don’t think anybody saw COVID

Alina: comment for sure.

Mike: So let’s talk about that for a minute. Here we are, again Q3 of 2020, what do you see?

That’s happened. What do you see is going to happen? I know nobody has a crystal ball and there’s a lot of projections out there, but what’s your opinion.

Alina: Let’s see. Let me get my crystal ball. Yeah. Yeah, no I agree with you. I think we, we have to be extra careful and I think we have to evaluate the pros and cons.

And I think before going into any investment, every everyone have to Make sure that they have the emergency fund set aside. And when looking at the particular investment each investor has to realize that whatever they’re putting in [00:24:00] there is a risk of losing that minus. So by putting that investment in, they have to realize that they may lose the money altogether.

They may make some money, but they may lose it. So going in with that assumption will help you make sure that. You’re making the right decision. And then once you have that set aside them take your time, evaluate the old, starting look at the market, look at the operator and look what strategy operator is planning to implement that strategy makes sense.

If you think that the operator can take on the strategy, they’ve done it before and they can implement it again, then definitely go for it. That’s

Mike: my way of thinking, right? I know you have a couple of meetup groups if how, what are they about? What do you talk about?

Alina: Sure. So I I still have to meet up groups.

The differences one was in New Jersey where I live, the other one was in New York, which you can bro, by the way, see behind me, that’s [00:25:00] a view to Brooklyn Heights. Now thank you. Thank you. Now it’s all virtual. We connect all online course and I bring the speakers and while they. And meet ups are called the power of passive investing through real estate.

One was New York. One was New Jersey. We talk about various topics. They don’t have to be just syndications. We talk about not only real estate, but for instance, I try to bring speakers that are relevant to my audience. So at the beginning of each year, I bring coaches that help us talk about setting up goals.

We did that this year as well. I also. I just recently had the meet that where we had the, a less stress coach she was talking about, excuse me, she was talking about the topic, sorry. We had this, she was talking about the topic that’s on mine [00:26:00] for a lot of people, which has stress. Everyone is getting stressed this day.

So she was getting. You exercises that people can do to control and manage that stress. And I thought it was phenomenal. So I tried to bring the speakers that are relevant to the audience that joining me so they can bring value and people can benefit and can educate themselves and do something with their lives.

After listening to a speaker who hopefully has impacted their life and why one way or the other.

Mike: Yeah. Yeah. Good. Hello. What would you what would you tell your younger self today about real estate investing and what to look out for, or what to look for?

Alina: I would say start investing as early as possible.

Educating yourself as early as possible. Know your limitations. Surround yourself by the [00:27:00] people that have skills that are complimentary to you bring value to other people in whatever area you’ll have knowledge and your, the subject matter experts. And always try to give first before asking for anything, just give you and things will come your way down.

Mike: Awesome. Thanks for that. What advice? Do you have any other advice or any hidden secrets that you’d give a new investor?

Alina: I always tell them to never stop educating themselves, always continue educating yourself and learning as much as possible about whatever real estate investing niche you chose and concentrate on that niche.

And if someone has a challenge of selecting that real estate investing niche I actually offer my training that I put together recently. It’s specifically. Topic of how to select the best real estate investing niche for yourself. And [00:28:00] I can share it with your speakers.

Mike: I think that’s awesome. And that’s one of the things where I think I see some synergy between us is I really believe education is important and not only education, but then the execution and who’s keeping you accountable.

So we can get overeducated. We can know all the things in the world, but until we start to execute until we start to give away what we learn, we can’t. Don’t move forward. We tend to stay flat or back up. I couldn’t like, say it again. I couldn’t agree more. Yeah. So I like what you said in the morning, in the beginning, transparency be transparent and get the education that you need.

You don’t know how to do something. Ask one of my philosophies. And it’s, I’ve always been this way with my employees and anybody I’ve ever worked with my coaching clients is I say, Hey, if you don’t know, ask, there’s never a dumb question. It’s just like when we both started our meetup groups, everybody started at group number one, [00:29:00] at meeting number one. And now there’s hundreds of meetings down the road. So we all have to start somewhere and that’s how we all grow. And hopefully we grow it. Yeah, the

Alina: important piece is not wait until it gets perfect. The important pieces, like you said, start somewhere. Once you start, it’s not going to be perfect.

It’s actually going to be very far from perfect, but the more you do it, the more repetitions you have, the more experience you gain and the better you become and the more you can value you can offer to other people. That’s the initial progress.

Mike: And I appreciate you bringing up the multifamily goal global summit.

That’s coming up in a couple of weeks, right? And what I want to say is education. We’re going to have 20 speakers talking about small to large multifamily deals. We’re going to have speakers talking about syndications. We’re going to have asset protection attorneys. We’re going to have the legal aspect syndicated, see it, syndication attorneys, to help you put [00:30:00] paperwork together.

If you are trying to get educated in some area, this isn’t just one vision, but we’re having some of the best name speakers on the circuit that are going to speak and talk and provide information. What I’d like you to do is would you please tell our listeners how they can get ahold of you if they have interest in talking to you or hearing about any deals that you have going right now?

Alina: Sure. Your listeners can find me on my website, which is samofinancial.com or social media handles whether it’s LinkedIn, Facebook or Instagram.

Mike: Great. And we will make sure that your information is on our YouTube page along when this airs. I appreciate your time today. I know that weekends are family time for you and that your kids are probably dying for you to get back to them.

And I really appreciate you taking the time and please tell your family. I said, thank you. And we look forward to our [00:31:00] listeners getting a lot out of this, any last comments that you want to leave anybody with?

Alina: Mike. I want to thank you again for having me on your show and on the upcoming summit, I’m really excited.

I hope your listeners will take advantage and also join us in the summit. And I’m sure they’re going to learn a ton and they will enjoy it a lot. And again, thank you very much, and I wish everyone an amazing time there, and I hope everyone is going to crush it afterwards.

Mike: Thank you. Thank you very much.

Thanks a lot listeners. I’m glad everybody was here today. I hope that you got something out of this. There has been a lot of good meat this afternoon. So remember, we’re here every Tuesday at 12 o’clock. Love for you to plug in subscribe and like the page and just get as much knowledge and education as you possibly can and find yourself, your niche, and execute.

Look forward to talking to you all soon. Everybody have a great [00:32:00] week. Alina, have a great week. Thanks for being here and look forward to talking to you soon.

Alina: Thanks Mike.

Kristen: Thank you, Mike, and thank you for joining us for another great episode of Insider Secrets. As always, Insider Secrets is brought to you by My Core Intentions. Join us on social media and visit mycoreintentions.com where you can get expert coaching on all things, multifamily investing in property management.

We’re looking forward to having you back again next week for more Insider Secrets.