Insider Secrets Podcast Episode #37

 Guest: Adam Nishikawa

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Guest Bio:

Episode 37 guest Adam Nishikawa

Adam Nishikawa is the Vice President of Exchange Resources, one of the largest independent Qualified Intermediaries in the nation. He began his career in commercial real estate, serving both individuals and institutional investors through the leasing and sales process. After witnessing the tremendous potential of a properly deployed 1031 Exchange strategy, the doors opened for him to become an IRC 1031 Advisor. Over the past 4 years, he has assisted in thousands of successful 1031 Exchanges all across the country, proudly offering free classes for brokers, escrow officers, and investors seeking to create generational wealth through an effective 1031 Exchange strategy. 


Standout Quotes:

  • “The most successful investors that I have, are investors who straddle themselves with a team of trusted professionals to help them through the investment process” – [Adam]
  • “I think the easiest way to make high-stakes business decisions is to get all the facts and just make sure you’re making an informed decision” – [Adam]
  • “People make mistakes, it’s a matter of how we come back from those mistakes” – [Mike]
  • “When you create a brand, be really genuine… people can spot a fake a mile away” – [Adam]
  • “At the core, it really matters who you are when nobody’s around or nobody’s  looking, versus when somebody is looking at you” – [Mike]
  • “Build a strong team and have people around you that buy into your goals and your dreams, that will help you accomplish them” – [Mike]

Key Takeaways:

  • Adam describes himself and his business strategy in one word, “Helpful”, sharing that the goal of his business is to help people in Real Estate understand the ‘1031 Exchange’ and make it easy for them to accomplish.
  • Understanding the ‘1031 Exchange’: ‘1031’  is a reference to a section of the Internal Revenue code. The ‘1031 Exchange’ is a transaction that permits an investor to defer the payment of capital gains tax by exchanging like-kind investment property for like-kind investment property
  • Adam explains some reasons why investors make use of the ‘Delayed Exchange’: Equity position, Depreciation, Movement of the investment property, and Diversification.
  • The beginning of an exchange process is the preparation, especially getting a team around to fully understand your position because the more prepared you are, the more successful you are.
  • The ‘1031 Exchange’ begins at the close of Escrow, and you get 45 days to identify a replacement property which can be done by either of two methods: The 3-Property Rule and The 200% Rule.
  • It is important to indicate the intent to do a ‘1031 Exchange’ just in case the IRS might want to confirm that you had that intention from the onset
  • Over 95% of his investors are successful at executing their ‘1031 Exchange’
  • Adam explains that the ability to create generational wealth and get personal and job freedom is one of the major benefits of Real Estate Investment and the ‘1031 Exchange’
  • Adam shares the importance of working with a team of trusted advisers early on in the investment process, as it is pivotal to a successful investment.
  • A common mistake investors make is often with pre-priced properties, investing a large amount of money hoping to get a high return.
  • Building a strong brand involves having strong work ethics and a helpful attitude towards everybody regardless. 
  • Build a strong team and have people around you that buy into your goals and your dreams, and will help you accomplish them.
  • For new investors: Be prepared and take advice.

Episode Timeline:

[01:15] Meet today’s guest “Adam Nishikawa”

[02:25] In one word, describe who you are and your business strategy.

[03:23] Adam shares his history and professional background.

[05:40] What is the ‘1031 Exchange’ and how does it benefit the investor?

[07:53] Can you explain what the tax rates are on the capital gains and how an investor is affected by that?

[11:30] Understanding the “Delayed Exchange”.

[15:54] Adam describes the process and timeline of a ‘1031 Exchange’

[22:08] What kind of things have you learned that got you excited about this space?

[23:27] An insider secret for investors

[26:00] From a personal standpoint how do you make high-stakes business decisions?

[27:06] What mistakes do you see investors make in the market place today?

[29:35] Building a strong brand

[32:20] Advice for new investors

[35:48] Mike recommends the book ‘The Millionaire Real Estate Investor’ by Gary Keller

[36:38] How to contact Adam:


Phone number: 609-550-6776.


Mike: [00:00:00] Hey everybody. It’s Mike, your host of insider secrets brought to you by my core intentions today. My guest is Adam Nishikawa and we’re going to talk about 10 31 exchanges. Hey Adam, would you let our listeners know a little bit about what they can expect this afternoon?

[00:00:16] Adam: [00:00:16] Absolutely. This afternoon, we’re going to be discussing the delayed exchange, reverse exchange, all of the general requirements for that for successful 10 30, one exchange, as well as.

[00:00:26] How to avoid some of the pitfalls that we see investors facing today, it’s really important that we can address all of the different aspects of the 10 31 exchange our investors, brokers and escrow officers feel a hundred percent prepared to enter that transaction. Awesome. And you’ll have to tune in to listening to the rest of that because it’s going to be some great information today.

[00:00:46] Mike: [00:00:46] Look forward to seeing everybody soon. Adam, we’ll talk to you in a few minutes.

[00:00:50] Adam: [00:00:50] Sounds good. Looking forward to it.

[00:00:52] Kristen: [00:00:52] 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 Moraski has more than 30 years of multifamily, real estate investing and property management experience.

[00:01:14] 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.

[00:01:31]Mike: [00:01:31]  Hey everybody. Good afternoon. It’s Mike, your host of insider secrets. Welcome back. And insider secrets is brought to you by my corn tensions. So I always ask you don’t have you been thinking about your intentions, what your plans are, what your goals are, but more importantly, what is your, why?

[00:01:48] Are you crystal clear on, on your why and what you want to accomplish? You know what MCI, where we invest in our client’s future through an education and a training platform, teaching you how to invest in multifamily, how to create short-term cashflow and long-term wealth while empowering you. In sound real estate principles through through these while living a balanced lifestyle.

[00:02:14] So my goal is to help you develop a strong foundation of practical principles to help drive your business to the next level, whether you’re a new investor or a novice investor, you know what, and shamelessly, I’m going to tell you. I cover a lot of those techniques in my new book, exit plan. Your complete guide to multifamily investing in why you need an exit plan before you buy a, you can pick that up on my website or at Amazon, but enough of that right now, I’m excited about my guests today, Adam Nishikawa with exchange resources and Adam, you want to say hi to everybody real quick.

[00:02:51] Adam: [00:02:51] Yes. Hello, and thank you for having me on the show.

[00:02:53] Mike: [00:02:53] You bet. I’m glad you’re here. And Adam’s going to talk to us today about 10 30, one and 10 31 exchanges. Adam began his career as a commercial real estate agent serving both individuals and institutional investors through the leasing and sales process.

[00:03:09] After witnessing the tremendous potential of a properly deployed 10 31 exchange. The doors open for him to become an a intermediary or a 10 31 adviser. Over the past four years, he’s assisted thousands of successful exchanges all across the country, providing an offering free classes for brokers, escrow officers, and investors seeking to create generational wealth.

[00:03:36] Through an effective 10 31 exchange strategy. Adam, I am really glad you’re here today and I’m looking forward to being able to deliver a whole bunch of good information to to our listeners today. What I’d like to do is, in one word, and I ask everybody on my show, this in one word, describe who you are and your business strategy.

[00:04:00] Adam: [00:04:00] One word, I guess I’d have to choose. Helpful. And that word is really just the goal of my business is to be helpful for investors help for helpful for CPAs brokers, anybody in the real estate space to really understand the 10 31 exchange and make it easy for them to accomplish. Good. That’s awesome.

[00:04:19] Mike: [00:04:19] Good. Yeah. Always giving back, it’s it seems like the, there might even be a little shift happening in the world, but everybody I’ve been talking to lately is more about what can I do for you then? What, what am I going to get out of it? And,  it’s a nice relief, especially after hearing some of the rhetoric lately that we hear on social media and other places, but Hey Adam, why don’t we start with your background?

[00:04:43] Tell us a little bit about how you got in real estate, what your passions are and how you wound up making that transition into 10 30 ones.

[00:04:52] Adam: [00:04:52] Yeah, I think that just like a lot of people’s stories, it was pretty accidental. I graduated there in point Loma Nazarene university and wanted to go into real estate.

[00:05:01] I was working for a property manager time. And I got my real estate license pretty quickly after college and started selling real estate and as well as helping people through the leasing process from tenant representation, and brokerage. And it was so interesting. All of the investors that I’ve met with, my first impression was that they all drove Ferrari’s and they all had range rovers.

[00:05:25] And, they were all living very lavish lifestyles that I met a lot of investors who. We’re mom and pop investors. And they started with nothing, a lot of them, even immigrants to the country. And I got to see how they use the 10 31 exchange, which at the time I really didn’t understand to grow their portfolios to what it was nearing towards the sunsetting years of their life.

[00:05:47] But it was just very interesting interacting with that from the brokerage side and the leasing side. And I ended up actually leasing some office space to the company I worked for now up in orange County. And that was actually the accident. I wasn’t even really looking for a shift in career, but they offered me a job and.

[00:06:07]At the time my wife was working in San Diego and this job that I was currently working was up in orange County. And so I would seemed like it was a door opening and I took the jump. Nice. Good for you. So you live in San Diego though, right? But your office is up in orange County, Irvine or so we have a San Diego office.

[00:06:29] Oh, you do? Okay. Office as well and an up Los Angeles office. And because we do 10 30 ones all across the country. We. Have offices in several other locations.

[00:06:39] Mike: [00:06:39] Okay. Nice, good. And so why don’t we start with this? Let’s you know, I’m sure that there’s a number of listeners on the call today who don’t know what a 10 31 actually is or understand it.

[00:06:52] So before we get granular, get down into, processes and things, let’s explain what the 10 31 exchange actually isn’t and how it benefits the investor.

[00:07:04] Adam: [00:07:04] Absolutely potentially you want to exchange, it, 10 31 is a reference to the section of the internal revenue code. So a lot of people, they have this misinterpretation that the 10 31 is a loophole, but it actually is part of the tax code.

[00:07:19] And in simple terms that as this it’s a transaction, which permits an investor to defer the payment of capital gains tax by exchanging like kind investment property for life kind investment. So it’s a transaction simply put and is really not as complex as some people believe it is.

[00:07:39] Mike: [00:07:39] So when you talk about like kind investment, does that mean that I can go from a single family house into a commercial multi-family apartment?

[00:07:51] Adam: [00:07:51] Yeah, the light kind is a pretty broad term and it’s really the qualified use of the property for investment or business purposes. And so it’s a really broad scope. So like kind, really can be a condo into raw land. Can’t be a condo into multifamily. It could be multi-family and into. Retail and commercial or office space.

[00:08:13]There’s really no limit as to what kind of real property it is,

[00:08:17] Mike: [00:08:17] but could I sell my boat if I made a profit on it? And would that be a light kind exchange? If I went into real estate,

[00:08:24]Adam: [00:08:24] not too long ago, property was allowed with the 10 31 exchange, but recently that has been eliminated from that section of the tax code.

[00:08:34] So unfortunately, boats, artwork cars. Those personal property assets are now excluded from the 10 31 exchange.

[00:08:44] Mike: [00:08:44] That’s good to know. I know you’re not an attorney, but , can you explain what the tax rates are on the capital gains short-term long-term and how an investor is affected by that? If they. Pull capital out of a property or I just wrote a book called exit plan. And I talk about exiting and knowing when to exit and when the right time is and how to exit. One of the things I talk about is 10 31, or just completely getting out of the deal or other alternatives.

[00:09:14] Can you talk about that a little bit?

[00:09:16] Adam: [00:09:16] Yes. So the 10 31 exchange helps you defer all of your capital gains tax and a capital gain rate. It was up to 20% of, whatever appreciation you’ve had on your assets since you’ve purchased it. What’s also included in there is going to be the depreciation recapture at least here in California. We have a clawback provision. So when you sell an asset here in California, the franchise tax board wants a depreciation recapture on that property. And that is going to equal 25% of your benefit that you’ve taken over the lifetime of the asset. So if you have a residential property, which depreciates for 27 and a half years, you’ve been taken out every year as part of your your tax return.

[00:10:01] And then at the end, if you decide to sell that property, you would owe 25% of that benefit back to. Back to the government. So that’s a big chunk of that capital gain tax, as well as the Medicare surcharge tax, which is 3.8%. Some people called out the Obamacare tax and all of these taxes, our investors are looking at anywhere between 15 and 30 something percent of their sale price as taxable.

[00:10:32] So that can be a pretty significant portion of. Our investors hard-earned investment.

[00:10:39] Mike: [00:10:39] Wow that’s interesting on that clawback provision. So would that even affect somebody, Adam, who is on a in their personal residence?  

[00:10:50]Adam: [00:10:50] So for the, for your personal residence, you received something called the one 21 exclusion, and that is a $250,000. If you’re single and $500,000, if you’re married of your capital gains tax-free. And so the 10 31 exchange was, is really only for investors in this form properties.

[00:11:09] Mike: [00:11:09] Okay. Okay.  Are there, is there one type of exchange or are there multiple types of exchanges as an investor do I need to know, what do I need to really be aware of or know?

[00:11:22] Adam: [00:11:22] Yeah. I think primarily the most common type of a 10 31 exchange is called the delayed exchange. And that’s where you are investors going to sell first and buy later.

[00:11:33]We have several other types of exchanges such as the reverse exchange, which would allow an investor to purchase the replacement property. First, we also have something called the construction exchange, which allows an investor to use their hard earned capital gains to make improvements on the replacement property.

[00:11:50] And we also do some hybrid exchanges for different. Complex tax scenarios, but the most common is definitely the delayed exchange and that’s what 90% of our investors are executed.

[00:12:03] Mike: [00:12:03] I really have a couple questions around the delayed exchange.  When is the best time what’s the writer best time for an investor to use that delayed exchange.

[00:12:16] Adam: [00:12:16] The delayed exchange, when an investor chooses to use an exchange there’s several really good reasons that I have seen my investors utilize it. And the first one is definitely just facing a large equity position. So I was giving it. The example of two apartment buildings, side-by-side identical apartment buildings, but one apartment building is paid off all cash.

[00:12:43] And the second apartment building has a loan on it. Let’s just say 50% just for round numbers. And I always ask the investor, which apartment building can charge more rent and they always think about it and they realize, they’re identical buildings and they’re charging identical rent.

[00:13:01] But if you have all this equity parked inside of your property, it is not working hard for you that cash on cash return. When you do the math, you’re going to realize it’s really not working for you. A matter of fact, your cash on cash return could be 1% or less. And so for a lot of investors, they’re really looking to move that equity.

[00:13:22] And they’re looking to grow their portfolio, use it, utilizing that equity because they want those tenants paying down those mortgages for them. And so I think equity position is the number one reason. I think people look to utilize this delayed exchange. The second most important reason would be depreciation.

[00:13:39] If you have an investor who say has owned a property for 26 years, they’re coming up on the end of their depreciation schedule. Of 27 and a half years for residential property. That means they’re going to run out of tax benefits at that point. And so at that, I would say crux in there that are positioned, they may be looking to buy up in value in exchange to get more tax benefits.

[00:14:03] And especially as their portfolio, there are other stocks, there are other investments are going up in value. This is the time for them to really keep those tax benefits moving forward. And so depreciation can be a big reason. And for those listening, commercial real estate has a depreciation schedule of 39 years and so slightly longer, but still they may be in that position to increase their depreciation benefits.

[00:14:28] I guess third, I would put. Just the movement. I think what technology today, you don’t need to live next year, investment property investors who enjoy they self manage, or they enjoy being next to their investment property. And so maybe they’re leaving California moving to Texas, like a lot of people they may be looking to move that investment property closer to them.

[00:14:50] So that could be a reason that they want to utilize a 10 31 exchange. Out of those top three, I guess the fourth one I would add might be diversification. I think a lot of investors, especially about the mom and pop investors I work with, I love working with them because, it’s like that micro portfolio and they’re looking for ways to mitigate their risk as they get older.

[00:15:11] And they wanted to diversify, especially with COVID-19 they only had one tenant in there, one condo investment property that they own. And that tenant could, unfortunately, was unable to pay their. Pay their rent. They’re losing a hundred percent of their income because they only have one condo, but they could utilize the 10 31 exchange to then sell that condo, take that equity and do a couple different properties, maybe a few if possible.

[00:15:36] And that way, when they lose a tenant, they’re not losing a hundred percent of their cashflow, especially if they really depend on that income in their retirement years. I think that’s one of the key benefits of the 10 31 exchange.

[00:15:51] Mike: [00:15:51] Okay. Yeah, no, that’s good. Good answers. Good. Good data.  Find it interesting.

[00:15:57] I had to laugh when you said people are leaving California going to Texas. Cause I know a number of people that have done that and I’m trying to get to orange County, I live in Chicago, but I’m glad they’re leaving though. Cause it’s making room for guys like me coming out there. Hey, how about why don’t you talk about the process and timelines a little bit?

[00:16:14] So if we’re going to do a deferred exchange, I’m going to sell a property that, I have a a single family house that I have rented right now. I want to sell out of that and I want to move into a six flat or a 10 flat. Tell me about the process and the timelines.

[00:16:31] Adam: [00:16:31] Perfect. So the 10 31 exchange, the IRS, doesn’t just let you take your sweet time on doing this transaction.

[00:16:38] They do give you a few deadlines and I want to explain a little bit about the delayed exchange process. So the first and most important thing that I believe is. Preparation, I get these calls the day before ASCO’s closing on an investment properties telling me, Hey, I just heard about something called the 10 31 exchange, but they don’t know their tax liability.

[00:16:58] They don’t know whether they’re looking to purchase a property and they’re pretty wholly unprepared. And so I always think the beginning of the exchange process is the preparation. And I think that every investor should consult their CPA, find out what is their tax liability on the property. How much, what are, what consequences are they facing for a failed exchange and what consequences are they facing for a successful exchange?

[00:17:25] And so I really think that preparation, getting a team around you, a broker CPA a lender, understanding where your position is key to a successful 10 31 exchange. But as far as the first time timeframe is that it begins at the close of escrow on your investment property. So if you would list your property just like you would any other.

[00:17:48] Primary residence, just going to go on the market. We have a little sentence you put in there just saying, you’re doing a 10 31 exchange, notifying the buyer, and you’re going to get into Asheville on that property and wants Astro closes. The IRS is going to give you 45 days to identify your replacement property.

[00:18:05] So 45 days can go by fairly quickly. It’s just over a month. And. You will be able to identify through several different methods. So that first 45 days is crucial. You, I would hope that an investor would have picked out the market, picked up the state and that they plan on purchasing in and as long as what kind of products they’re looking for and what kind of return they expect.

[00:18:27] And once they’ve picked, a few properties, they’re going to narrow it down. They’re gonna have two options. The first is going to be the three property rule, and that’s going to be identifying the three properties regardless of fair market value. So if they sell for $500,000, they can list $20 million of real estate as long as it’s only three properties.

[00:18:47] So they won’t have any limit as to what that, what does assets are like? The other option is the 200% rule. So for my investors coming out of San Diego, Selling a condo for a million dollars and going into St. Georgia, they need to spend a million dollars looking into kind of how you calculate the net replacement value, but they’re going to need to identify potentially more than three properties in Georgia.

[00:19:12] And so the 200% rule identify it’s many properties as they’d like up to 200% of their sale price. So up to $2 million, they can list. Four or more properties. And as long as the aggregate fair market value does not exceed 200% of their sale price. So those are the two identification options that are most commonly used and will be utilized during that 45 days to identify their replacement properties.

[00:19:40] After they’ve identified their properties, they will need to close Astro by the hundred and 80th day. So they’ll have just shy of six months to finish the transaction. The more prepared you are, the more successful you are. And I’m proud to say over 95% of our investors are successful at executing their 10 31 exchange.

[00:20:00] And so that’s why I like to see a lot of preparation in advance. Now I have transactions not coming for two years down the road, because there were things that they had to clear up before they could do. Their sale. So those, I would say definitely that 45 days is crucial. And then you must execute by the hundred and 80th day.

[00:20:18] Mike: [00:20:18] So does the clock start ticking at the time the buyer gives you a contract or the close?

[00:20:25] Adam: [00:20:25] The clock starts ticking at the close of escrow. Okay. You need extra time. You’re going to need to extend your escrow.

[00:20:32] Mike: [00:20:32] Okay.

[00:20:33] Adam: [00:20:33] Some sellers, depends on where the market’s at. If it’s a sellers market or a buyer’s market, how much they’re willing to work with your timeframes.

[00:20:41]But it’s definitely worth it to have a clause or two in there of maybe a 15 or 30 day extension. If you really are having a hard time nailing down the market, you want to move into.

[00:20:52] Mike: [00:20:52] Okay. So you mentioned something early on when you were talking about that, that the, you want to put a clause in the listing agreement that the buyer or let the buyer know that you’re going to do a 10 31 exchange.

[00:21:05] Why is that important?

[00:21:08] Adam: [00:21:08] You know that clause helps. Although it may not be required from the statements from the standpoint of, legally, it will be help you create that precursor of you, your intent to do a 10 31 exchange. So if the IRS audits you and says, Hey, you did a 10 31 exchange, we want proof that it was your intent to do this in advance.

[00:21:29] To make sure nobody was backdating any docs or doing anything illegal. They can see that it was in the sale contract. So they’ll know it was your intent to do a 10 31 exchange. Would that property.

[00:21:43] Mike: [00:21:43] That’s interesting. What what kind of lessons have you learned as a result? One of the things that you talk about early on is your passion from coming out of that leasing space, into seeing it as successful 10 31 being done.

[00:21:59]What kind of things have you learned that, that got you really, excited about the, about this space and why do you think that it’s so beneficial?

[00:22:11] Adam: [00:22:11] Yeah. I’m a fan of stocks and bonds and other investments, but real estate, I’ve seen countless number of people come to America and are able to really create what I consider a generational wealth, but it’s, and to help set their families up to a point where, you know, the nine to five job isn’t essential to their survival.

[00:22:34] And it was just pretty refreshing to see. Really just a group of entrepreneurs. I always think of real estate investors as entrepreneurs because it is their business and they have an independent impact on how they run their business. And so I think what I’ve learned over the years is what I really love about real estate and the 10 31 exchange is that anybody can do it.

[00:22:55] And it’s just been great to see families. Really the freedom of provides them. For personal growth outside of just their careers.

[00:23:05] Mike: [00:23:05] Yeah. Very good. Thank you.  The show is called insider secrets, right? So from a vantage point, looking in at real estate investors and the market, what do you see as a insider secret or that an investor should pay attention to today?

[00:23:26]Adam: [00:23:26] There’s a lot of insider secrets that investors need to pay attention to. But if I had to share one detail of all of my most successful investors people who I think have done the best job of growing their portfolios, I would say it’s putting a team of people that you trust advisors around. You.

[00:23:49] Early on in the investment process. Not waiting like, Oh, I have some investors. They really think that the brokers are trying to take them for all their worth. And they think the CPS then charge them. Up the wazoo and they have all the, they think that all these advisors are just people trying to get paid off of them.

[00:24:05] But the most successful investors that I have are investors who strata themselves with a team of trusted professionals to help them through the investment process, because none of us can know everything about all of these aspects of real estate investing. And we need a team of people around us to help us through these processes.

[00:24:26] And I’m talking about from the broker, from the CPA, making sure you’re getting all of your tax advantages, the broker bringing you opportunities. Can’t tell you how many investors have gotten. Off market under appreciated properties. For what I consider really good deals that have helped their portfolios grow significantly quicker than if they were just out there searching themselves, knocking on doors.

[00:24:52]Really just having those advisors around you. Makes this so much more successful. And I think that the biggest insider secret I can share is just making sure you have that team of of advisors around you. No matter what, if your only investment property is $50,000 or it’s $10 million.

[00:25:09] Mike: [00:25:09] Yup. Well-spoken by the way.

[00:25:12] And I’m in the coaching business. And I think a lot of times people miss those things and it’s really important that people with more experience mentor and coach the people around us so that they don’t miss them.  As much as they do right. How do you, from a personal standpoint, how do you make high stakes business decisions?

[00:25:34] Adam: [00:25:34] I think the easiest way to make a high stakes business decision is to get all the facts and. Just make sure you’re making an informed decision. One of the things I do for my investors, so I’ll send them a property analysis calculator. It’s just an Excel spreadsheet that can help them run through the numbers and really make sure they understand the full everything about a property from the expenses to the income potential.

[00:26:05] I see so many investors. Buying properties because of, potential income instead of the reality of the income. And I think it’s just gathering all of the details. And so I always tell my investors, just get all the facts.  The potential is great, but we need to see what’s. What is the reality of this property?

[00:26:27] Mike: [00:26:27] Yeah. So with that said,  what mistakes do you see investors making  in the marketplace today?

[00:26:36]Adam: [00:26:36] I think I touched on it a little bit. So it’s pre priced properties, they’re promised some return, but in reality, maybe they can’t get that return or it’s going to be a lot more work to get to where they want to be.

[00:26:46]The biggest mistake I’ve seen at least on the San Diego market. Has been some inner BNB properties. Some communities are not friendly with those types of investments. And especially if you have an HOA, if you buy a property thinking you’re going to get XYZ income off of it, it could make your spreadsheet look really good.

[00:27:07] But in the reality is, some of these properties, the HLA decides they don’t want to allow short-term rental properties or they’re going to fight you every day about it. I think those investments have been the most hurtful for investors who were expecting a certain return, potentially overpaid for a property.

[00:27:24] And weren’t able to get that return on the back. I think that’s the biggest mistake. I don’t see a ton of. Mistakes on buying replacement property. I see a lot of successful investors buying property that maybe I didn’t originally agree with. And it’s not really my job to give them that input, but it turned out really well for them.

[00:27:46] Mike: [00:27:46] So  sitting from the seat that you’re sitting in. Do you give investors that advice about the type of property or if you think it’s a good value or.

[00:27:59] Adam: [00:27:59] Yeah, I can share my 2 cents, but I really don’t want to step on any broker’s feed as far as I really, they are the professional. That’s helping walk them through this transaction and through these purchases and sales.

[00:28:12] And I really think they have the best grasp on that, but, if I see an investor about to make. A potential mistake. I may say something, and we would hope that they have the best grasp on it, right? Yeah. I’ve been in the business a long time and listen, I’ve made my mistakes and I think people make mistakes.

[00:28:32]Mike: [00:28:32] It’s a matter of how we come back from those mistakes and. One of the things I say in my bio is I have a very resilient perspective and attitude. It’s about bouncing back and what changes we do differently. Hey, how do you think somebody can build a strong brand today?

[00:28:47] How do you build a strong brand about around what you’re doing?

[00:28:53]Adam: [00:28:53] I think for me personally, it’s having strong ethics. And like I said, with that, that helpful attitude of regardless to, if I’m going to end up working with this client or how many, I end up getting paid off this transaction, it’s just having an attitude of helping everybody because you never know what people are going through.

[00:29:12] And they may call it, I’ve had several investors call me for advice. We ended up just talking about life and other things and down the line, maybe they forget about me or they don’t end up working with me and they pick a different qualified intermediary. I just enjoy serving other people.

[00:29:27] And I think that when you create a brand be really. Really genuine and, people can spot a fake, a mile away, it’s just being always able to help people seeking out, helping people and making them feel comfortable. And I think that’s the brand. I hope I portray and I want to create for myself.

[00:29:48] Mike: [00:29:48] Yeah. A couple of things that you have said here over the last few minutes that I think are really important. You alluded to ethics, you mentioned ethics and I think that at the core, it really matters who you are when nobody’s around or nobody’s looking versus when somebody is looking at you.

[00:30:06] And I think that shines through with people. The other thing that you talked about was your network, the people around you, your team that you build. And one of the things I teach my coaching clients, and it’s really one of the basic early on lessons that I teach with people is build a strong team.

[00:30:25] And have people around you that buy into your goals and your dreams and that are going to help you accomplish them. And if you build that will be long lasting for you. And I believe really more and more today that if you build it ethically, that there’s a lot to be said for that, in, in life, in business and in relationships my new goal this year  is to talk to two new people a day and just see how I can  foster some really good solid relationships,  where maybe I can do something for you or help your business grow.

[00:31:03]I like, I liked being able to do that today. What off the cuff, any new advice that you’d give a brand new investor coming into the marketplace today?

[00:31:13] Adam: [00:31:13] Man, it’s hard to so much potential advice, but yeah.

[00:31:18] Mike: [00:31:18] Yeah.

[00:31:19] Adam: [00:31:19] I think it’s just be prepared and pick advice, even if it’s somebody that you don’t want to take advice from. Everyone has something good to say. And, they have some piece of advice that you may disagree with. A lot of other things about them, but they’re gonna search for that one good thing.

[00:31:37] And just listen to as many people as you can.

[00:31:40] Mike: [00:31:40] Nice. We’re good gem. So on a little lighter note, I love San Diego. What is an actually, I’m an advocate for orange County, South Southern California, anywhere really, but what’s your favorite tourist attraction?

[00:31:56] Adam: [00:31:56] Yeah. SanDiego has a lot of great things being on the water.

[00:31:58]We have Cornado Island and. All these beautiful beaches that I think my favorite tourist attraction, probably going to be the midway ship, which is parked over there off of downtown. It’s a really cool tour of an old ship that has a lot of history. And another really the cool thing about it is if you go during an off season in the summer, they host movies up on the tarmac upon the top.

[00:32:27] And there’s a lot of really cool things, as well as having a lot of former fighter pilots and stuff out there speaking to you about the history of the ship. And it’s a great center place to begin exploring San Diego being that it is anchored off of downtown close to so many restaurants and shops. It’s a great place to just start your San Diego adventure, I guess you’d say.

[00:32:49]Yeah, so I guess that’d be my favorite tourist attraction.

[00:32:52] Mike: [00:32:52] Nice. Speaking of restaurants, what’s your favorite restaurant?

[00:32:57] Adam: [00:32:57] San Diego I think has grown incredibly over the last few years, as far as new restaurants less chains, a lot more mom, pop restaurants popping up authentic cuisines, but I think, when you come to San Diego, you really want that view and you want And it’s changed for me, because when I think about like COVID impact on the restaurant business, say I would recommend Costanera, which is on Harbor Island in San Diego and the food is good, but the view is great and it has a ton of outdoor seating.

[00:33:31] And I think that’s being in the middle of COVID important. Yeah.

[00:33:35] Mike: [00:33:35] Yeah, that’s a whole nother conversation, best book you’ve ever read

[00:33:40] Adam: [00:33:40] best book I’ve ever read. Oh gosh. For me shame will stay. I’m going to tell you it’s the Bible. Okay. But I have been looking for some additional books to add to my collection.

[00:33:52] So if you have any recommendations, I’d like to turn that question on. You could say, what’s the number one book you recommend?

[00:33:58] Mike: [00:33:58] What would the book I just wrote? No, you’ll have to get this copy. Yes, actually for me the Bible is at the top of my list and. The best investor book I’ve ever read is called the millionaire real estate investor written by Gary Keller.

[00:34:19] I was a Keller Williams agent for a number of years and it very it’s one of those books. I, you know what I always said, it was the investor’s Bible that they could go back to it over and over again and understand philosophy and technique and strategy.  Always felt that was a really good book.

[00:34:39]So when a matter of fact, when I went into syndication business, I taught from that book a lot. So that’s a whole nother podcast, but. Hey Adam, I thank you very much for being here today. You’ve been a wealth of knowledge and information. I know that , my listeners will really appreciate your information.

[00:34:58] How do they get ahold of you knowing that you can do a 10 31 anywhere in the country, how do they get ahold of you to pick your brain and possibly be involved?

[00:35:09] Adam: [00:35:09] Yeah, they can go onto our website, which is exchange And. Or they can reach me through my cell phone, which is going to be (609) 550-6776.

[00:35:22] And my email which I’m sure will be provided on here, but you can get that through the website. My last name’s Nishikawa. So that can be long asked on that. Yeah, I’m available anytime and anybody who wants to just chat, discuss, like I said, I have transactions two years down the line and preparation, is key.

[00:35:39] So I’m happy to discuss, way in the future plans for any investors, just that want to make sure that they’re prepared and pushing their property in that direction.

[00:35:48] Mike: [00:35:48] Sure. Yeah, I appreciate that. And all your information will be on our website and on the show notes as we get ready to air this episode.

[00:35:55]Hey, again, I want to thank you for being here. You’ve been a wealth of knowledge. I know my listeners have appreciated that too. Hey everybody. Thanks for being here Tuesday afternoon, insider secrets. Make sure that you go and subscribe on YouTube and on Apple, Spotify, wherever you’re at. Love us like us and yeah.

[00:36:13] Tell your friends about us, would you and help us grow. Thank you. And we will look forward to seeing you next week, Adam, have a great afternoon.

[00:36:21] Adam: [00:36:21] Thank you, Mike.

[00:36:22] And thank you everyone.

[00:36:23] 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 corn tensions. Join us on social media and visit my core where you can get expert coaching on all things, multifamily investing in property management.

[00:36:42] We’re looking forward to having you back again next week for more insider secrets.