In today’s episode of Ritter On Real Estate, we chat with Yonah Weiss. Yonah is a self-described “powerhouse” when it comes to helping property owners with tax savings. As Business Director at a national cost segregation leader, Madison SPECS, Yonah has assisted clients in saving tens of millions of dollars on taxes through cost segregation. Over the past 15 years, Madison SPECS has done over 16,000 cost segregation studies covering all 50 states, resulting in over $3 BILLION in tax savings. In addition to helping investors save on their taxes, Yonah is the founder of Real Estate Connections a virtual meetup group hosted every Wednesday at 7 pm EST which allows individuals to learn and network with other multifamily experts. Welcome to the podcast Yonah!
Key Points From The Episode:
- Yonah’s background & upbringing/ his passion for helping others.
- Starting his career as a teacher, then transitioning to real estate.
- Why real estate investing is a great vehicle for wealth building.
- The importance of having a growth mindset.
- Understanding that passive investing still requires being active.
- What is cost segregation?
- The role cost segregation plays in real estate investing/taxes.
- Bonus depreciation laws explained.
- Offsetting taxes in Real Estate Deals.
- How networking positively impacted Yonah’s life and business.
- Jab, Jab, Jab, Right Hook By Gary V.
Yonah Weiss 0:00
Cost segregation is a method of breaking down the property into different components or segregating the property into these different components and seeing out. There are actually individual things in the property that actually depreciate or go down and you have to replace over a much shorter period of time, and the IRS gives you the ability to take that deduction at a faster rate.
Kent Ritter 0:23
Welcome to “Ritter On Real Estate”, the show about how to passively invest like a pro. On each episode, I interview real estate experts to give their top investing advice, strategies, and tools. I break down the insights into practical steps to avoid the pitfalls and make better investments. I want to help you passively invest like a pro. This is “Ritter On Real Estate”, I’m your host, Kent Ritter.
Kent Ritter 0:46
Hello fellow investors. Welcome to another episode of “Ritter On Real Estate”. I’m your host Kent Ritter, and today very excited to have Yonah Weiss on the show, known Yonah for a number of years now. I’m sure you guys know who he is. Everybody knows who Yonah is but I’m excited to have him today because every time I get a chance to talk with him, you know, I learned something, or I get connected to somebody that I needed to be connected with so excited to have you here. He’s a business director with Madison SPECS. He is the Cost Seg king as most people know him. He is a fantastic people connector; I can attest to. He’s the host of the Weiss Advice Podcast and he also hosts a virtual meetup called Real Estate Connections. And so again, just everything he’s doing, bringing folks together, so Yonah, thanks again for being here today and letting folks know a little bit about who you are. So give us your background, kind of how you got to where you are today?
Yonah Weiss 1:52
Sure, thank you so much. I appreciate you having me on the show. It’s always a pleasure as well to spend time and talk with you. I love going on a podcast, because you get an opportunity to speak to a whole new audience who, as you mentioned, people may have heard of you before, but I’m sure there are plenty that hasn’t. So happy to be here a little bit about me, I, as you mentioned, my main occupation now is Cost Segregation. I work for the largest cost segregation company, and that’s what I do a full-time job. But it wasn’t like, you know when I was a kid, or like, hey, I want to be a Cost Seg king when I grew up. It’s not something really people think about or talk about. But I was a teacher for many years, my passion has always been in helping others and teaching for 15 years, I have a family of six kids.
So I’m always teaching like, at home, and on the road wherever I go at a certain point, I realized teaching, you know, as much as I love it, and I started a nonprofit organization to help needy families. But I realized it’s very difficult to make a good living, especially with a growing family. And I reached out to some friends of mine and was like, okay, what can I do to kind of get some more income or get some, you know, maybe another career of sorts and real estate was the industry that just jumped out because it was something that you could do without any additional formal education, which I wasn’t interested in doing at that time in my early-mid 30s.
And also, it was something that had a lot of potentials, I mean, not just potential for income, but the potential for, you know, growth and I realized quickly, when networking, as you mentioned, something I love to do, I started meeting such incredible people in the real estate industry and did a bunch of random kind of odd things just to learn everything about, commercial real estate and residential as well. So I was a mortgage broker for a little while, commercial mortgages, a few fix and flips, and some residential brokerage just to kinds of get my feet wet and figured out like from what everyone else is doing and seeing it from both perspectives, both the investing side as well as the kind of servicing side of lenders and working with banks and working with brokers. So I kind of saw a lot of different perspectives.
And at a certain point, I was reached out by this company, Madison towards real estate, and it was just like a perfect fit and opportunity to get into this conservation company that was growing fast and I just really fit into a role of education, which was something that my passion was always about is just really teaching people because I realized that here’s this topic that is so incredible, once you know what it is, but most people don’t know what it is and so it’s like, okay, here’s this awesome opportunity to teach as many people as possible, help as many people as possible and simultaneously investing, you know, getting to know other client sponsors that I’m working with and ultimately, I’ve grown a tremendous amount, as you said through the networking through the podcasting, through the meetups, and through investing, so I’m very grateful to be where I am.
Kent Ritter 5:04
Oh, that’s awesome and it’s a cool story. I’m sure there are other industries like this, but the thing that I think strikes me about real estate, at least, is the area of real estate that you’re in, and I’m in, the kind of the maybe multifamily real estate. That’s not a huge institution. That’s a lot of individuals or groups of people that are out there doing it is, I mean, I don’t know, probably 90% of people, maybe more, it’s their second career. It’s kind of their second life. We’ve all come to it from something else and for some reason I have been thinking about that. I don’t know, over the last like, week or so I saw you at the conference, actually. And I was like, man, yeah, because you talk to people, it’s like, “Oh, what did you do”? I was an accountant. I was in construction. I was something else. But I think it is because of those opportunities that you described. I mean, real estate, has changed my life too. It’s given me the financial freedom that I didn’t think I’d be able to have. The ability to work when I want, where I want, and be able to start my own company and kind of build that and help other people and both employees and clients. It’s just incredible.
And I think it’s probably a lot of our second careers, because like you said, it’s not that well known. I mean, I like that’s what always strikes me and that was why I started the podcast too, because like, when I learned about this whole world because what I thought real estate investing was because it’s the only thing I’d ever been exposed to was, you buy a single-family home, and you become a landlord, and everybody I knew that was doing that as they hated it. They didn’t like it. They’re like, this guy called me, you know, 2 am and his toilets broke and blah, blah. That never appealed to me. I didn’t learn until I was in my early 30s- a different world where you can buy large apartment buildings, you can invest with others, and you can do it passively. And you can build a portfolio and syndicate and do all these different things. Like, I just had no idea that it’s not exposed in that way. So I guess those are kind of like my theories, I’ve been thinking about. There are so many people that have come to it as a second career, and kind of why that is, and why more people don’t just start, like right away?
Yonah Weiss 7:36
Yeah, I agree with you on the thing, people think about real estate and think about being a landlord and having tenants, and my parents actually owned, like a few out-of-state rentals. And even though they have property managers dealing with those single families, but they still had problems, like the pipes, you know, the infrastructure pipe broke, and they had to pay like $10,000 to get that fixed. So they had no cash flow from that property for the year. And there are little things like that don’t interest me. I’m not interested in that at all. It’s just like a headache more than anything else. But one of the things that I agree with you and see, the common denominator with a lot of people in this space, is that they’re kind of growth-oriented people and so it takes a growth-oriented type person to be able to make that shift in life to say, okay, I didn’t enjoy what I was doing before, or maybe I did, but I want something more and I want to be able to give back and I want to be able to take more grasp of my life and my time and spending time, my family, etc. And so that’s kind of the people like you meet all these people that conference, like everyone’s into that, everyone’s into growing, being a better person, I think you are able to grow a business properly and help people and investors if you’re really truly fixed on the fact that you want to be a better person.
Kent Ritter 9:00
I think that’s a great insight, and that is a common denominator and I think that growth mentality is absolutely whether you’re doing it like full time and you’ve kind of dove in like you’re investing passively like we were talking a little earlier on the show like even passive investing is a very active thing. You have to have that growth mindset, I think even to do that because you have to be willing to learn like you got to educate yourself to be able to make good investments and that’s what this show is all about. But you can’t just be willing to kind of sit on the sidelines, give your money to somebody else, and kind of hope for the best. You got to be willing to take control of it and I agree with you. I think that does take that growth kind of mindset. So listen, you’re the Cost Seg King, so I’d be remiss if we did not talk about cost segregations and it’s been a while since we’ve had somebody on the show, to talk about a cost seg, so I think we should start at the beginning. Just tell the listeners, what is cost segregation and how does that fit into a real estate investment?
Yonah Weiss 10:15
Sure, let’s just start from the beginning. I mean, cost segregation is a weird name that the IRS gave to this deduction, that is really depreciation. It’s an advanced form or a very complex form of depreciation. So depreciation, let’s take a step back and just understand what that is. Anytime you buy a property, as long as not your personal residence if it’s a rental or business property, anything like that, and you get a tax deduction from the IRS, that’s called depreciation. And depreciation, even though it sounds like a negative thing, something going down in value, you have to remember it is just a borrowed term. It’s a deduction that’s named after the borrowed term for something that goes down in value as time goes on. So we’re going to give you this deduction on your property when you buy it as if your property is going down in value. So you can kind of write it off, even though it’s not sold. I mean, obviously, most properties are going up in value, it’s appreciating, nevertheless, that’s what depreciation is. But typically speaking, it’s given over a long period of time, and you can take the property value that you buy, and then write that property off, meaning reduce your income taxes over a 27 and a half, or 39 year period, which is a long time to wait to get like all these deductions.
Cost segregation is a method of breaking down the property into different components or segregating the property into these different components and seeing how individual things in the property that actually depreciate or go down and you have to replace over a much shorter period of time and the IRS gives you the ability to take that deduction at a faster rate. So for example, stuff like furniture, or fixtures or appliances, or even shelving or window treatments, anything that’s non-structural in the property, even carpeting or flooring or cabinets, all that stuff, non-structural, that actually depreciates according to the IRS on a five year period. The method of cost segregation is identifying through an engineering study what those individual components are, and what the value of them is, and then taking a tax deduction for those values at a faster rate at that five-year schedule, so you can actually take those deductions upfront.
Kent Ritter 12:41
Gotcha. I think that was good. That’s a lot to cover.
Yonah Weiss 12:46
There’s a lot.
Kent Ritter 12:47
So that’s what it is. You’re accelerating the depreciation schedule, you’re able to take more depreciation essentially, in the first year and that’s the big bump when people see that, but now, so we know what it is but why should investors care about that?
Yonah Weiss 13:07
Excellent question. So any investor gets a portion of that deduction, just like you get if you are an owner in an investment. Obviously, it does depend on what type of investment it is, for most people, we’re talking about passively investing in syndication. Generally speaking, you own equity in the property itself, you own actually a portion of the property and as such, you not only get the cash flow or get the returns on your investment, but you also get proportionate to your investment, the deductions as well. So this depreciation deduction is gonna be allocated among all the investors. So it’s a cash flow tool, essentially, that during the life of ownership, here’s a great strategy that you can not only get your return on investment, but it can be literally tax-free during that time period. There’s an added benefit for anyone who’s a passive investor, that’s also a real estate professional, that you can actually use these deductions against active income as well but that’s it maybe for a follow-up.
Kent Ritter 14:12
Yeah, I mean, it is a fantastic benefit but now that I qualify for that, but I think that is something that people should look into what is a real estate professional, as the IRS defines it and how might you qualify because that really is a game-changer when you can offset all of your income using this depreciation strategy. So remember guys, as we just go back to why do we love commercial real estate. It’s not correlated to the stock market. We want a diversified portfolio that is non-correlated, meaning if the stock market goes down, the value of the real estate does not also go down. They don’t move together and that’s number one, you got to build out a good portfolio, just across all of your assets but why do we have commercial real estate like cash flows, it appreciates, and it saves you on taxes, it’s tax advantage and this cost segregation study that’s done and that bonus depreciation that you’re able to get is the major driver for that piece of that tax advantage piece of why we love commercial real estate. So really important to understand what it is. So Yonah, are there certain questions, like as a passive investor that folks should be asking if they’re evaluating deals if they’re evaluating a sponsor to know that, I mean, obviously, do a cost seg but is there anything deeper than that, that folks could ask to know that, hey, this person knows what they’re doing?
Yonah Weiss 15:58
Yeah, it’s a really common question, especially nowadays, since the Bonus Depreciation Law came about, and we can talk about that for a minute as well, in a second.
Kent Ritter 16:05
Yeah, that’d be good.
Yonah Weiss 16:07
But one of the questions that I get a lot from my clients is, and who are syndicators, as their investors want to know, are you doing cost segregation? Number one, but number two, is there a way to figure out how many deductions I’m going to get based on that investment and that’s more important for someone who is a real estate professional, or their spouse is a real estate professional, because that means they can use massively, this amount to not only offset their rental income or from other investments, but also to offset active income but I do get that question a lot.
It’s important, but it’s also important to realize because if you have a syndicator, who is doing cost segregation, you know that they are going out of their way to take advantage of these tax strategies means that they’re not someone just necessarily new to the game. It does come with a little time, a little more experience to know that these things do exist. And it really is looking out for investors, especially, because you want to make sure that they can use these deductions and that they can get their best interest from the returns on their investment as well, which kind of leads me to you know that thing about the bonus depreciation, which was a new law.
As I mentioned before, the cost segregation is a great way to kind of front-load some portion of those deductions to the earlier years and I had mentioned the five-year category that’s called Personal Property Things, that are non-structural. Inside the building, depreciate on a five-year schedule, but there’s stuff outside the building, also called Land Improvements, anything like landscaping or pavement, concrete, fencing, anything that’s outside of the property, essentially, that’s called Land Improvements depreciates on a 15-year schedule.
A few years ago, with the Tax Cuts and Jobs Act, they’ve introduced a new law called 100% Bonus Depreciation, which allows the taxpayer, allows property owner to take 100% of those deductions in the first year. So instead of waiting five years or waiting 27 and a half years to take, you know, a deduction each year, an equal amount over that period of time, you could use cost segregation to front-load, maybe 20-30% of that into a 5 year, 15 year category, which would give you faster, bigger deductions during those first five years. But you have now the option to take all of that out from the first year. So just to give you a picture of what it actually looks like, if you buy a million-dollar property, and you’re able to take 25% of that upfront in the first year. That means you can literally put 25% down payments $250,000 and in the first year, get a $250,000 tax write-off. So literally dollar for dollar, how much you put in. It’s an incredible way to like I said, give that return on investment a higher amount.
Kent Ritter 19:12
Yeah, I appreciate you explaining that Bonus Depreciation piece. Is that something that we expect to stick around for a while at this point, what’s been the latest guidance on Bonus Depreciation?
Yonah Weiss 19:26
When it was enacted, it was only enacted for a temporary period of time. So it was set to phase out and still is, as far as now, nothing has been changed since the 2017 tax reform, but it was set to phase out starting in 2023. So it’s going to go down to 80% bonus and then down to 60, 40 until it’s totally phased out. And there will still be cost segregation which has been around for 40 years or so. But this Bonus Depreciation Law as far as it is right now, we’ll see what happens in the next couple of years, but anything changes, but as far as now, it’s still around, but it’s going to start phasing out in the future.
Kent Ritter 20:07
Gotcha. Okay, I didn’t realize that. So as you talk about that, and you talk about the depreciation, some folks may just say, “I’m just making a passive investment, I really don’t need all of that depreciation”, but it carries forward so if you have extra depreciation and you’re getting in the one that you’re not using, it will carry forward and offset against future passive gains. So it becomes very effective in a real estate portfolio when you get to the point where you’re invested in deals, and those deals now start to sell. And as long as you’re selling and then investing in new deals in that same year, those will offset. You can use that new depreciation to offset gains from that sale. And so you can have a very effective tax strategy, just from continuing to invest without having to go into ten, thirty ones and different kinds of vehicles, that may not be open to you as a passive investor, just by going through the process of continuing to make good investments, you can offset a lot of those taxes and continue to really kind of kick the can down the road from a tax standpoint.
Yonah Weiss 21:26
Exactly, and I think a lot of people don’t understand that. There are so many different factors that can really be played out that can affect investment. So we are talking really general here, and I do want to point that out, obviously, this is not tax advice, you want to, you know, speak to your CPA. You just need to make that disclaimer, but there are a lot of factors that can either help or hurt your situation, depending on like you said, if you are continuing to invest or reinvest especially if your sponsor is using cost segregation, you can continue to kind of kick that can down the road and use these investments. Get those returns, and continue doing that in a kind of tax-sheltered way for as long as you can.
Kent Ritter 22:14
Yeah, it’s one of the best-kept secrets in real estate. One of the best strategies is continuing to invest and continue to offset those taxes. I think from a deal sponsor standpoint, for somebody who’s buying and syndicating properties, one of the pro tips, one of the next level things that you can look out for is, you know, the depreciation doesn’t have to be distributed just related to your equity percentage. It doesn’t have to follow and that’s the most common way. Is it will follow, it’d be distributed based on your percentage of ownership, but you can actually, through the operating agreements, if you’re thinking about it ahead of time, I mean, you can shift depreciation more toward the folks that can really benefit from it. And away from folks that can’t benefit from it such as if folks are investing with their solo 401 (K) or self-directed IRAs, the depreciation expense really doesn’t do anything for them, because it’s already they’re already in a tax-advantaged vehicle. You can actually shift their depreciation over to the investors who are investing with cash and give them an extra share of depreciation. So I think that’s kind of like a next-level strategy that can really show you an advanced operator.
Yonah Weiss 23:43
100% like you said, it must be done the right way but ask about it. Because you know, especially if you’re someone that’s looking to invest a large amount of capital and are looking for the best tax advantage way to do it, you may have an operator that will be willing to kind of work with you. If it’s just a small amount less so probably but I’ve certainly had scenarios where they’ve been able to work out a type of operating agreement, and they were able to through different structures, work out a way to shift the depreciation or allocate more of that to certain people that can use it more.
Kent Ritter 24:19
Yeah, so Yonah, I want to switch gears a little bit here. I think that was a good cost seg overview. We don’t want to get too deep, and we’ll give information after the show. So if folks are interested, they can dig deeper. I want to talk about networking, because I know it’s something that you’re really passionate about, something you’re very good at. I’ve participated in some of the events that you do on LinkedIn. It had a tremendous impact on my reach on LinkedIn for lack of a better world. So I want to talk about networking because we talk a lot to the passive investors on this show and one of the common themes that I always try to get across is, even though it’s called a Passive Investment, you got to be active in it. I think one of the most important ways to be active is by networking. Because one of the most important things you do as an investor is meet good sponsors because that’s how you get good deals. So, while I have you here, I’d love to just hear kind of your perspective on networking, why you’ve decided to pour so much time into it? Give us a case study of what that’s meant for you in your life as the proof point and then I’d love to hear some tips on how folks can be better at it?
Yonah Weiss 25:51
I’ll start with the last question first because, for me, it all starts with the foundation. And for me, the foundation is all about networking, and business in general, and marketing in general, and this applies to everyone. So it doesn’t matter who you are, right now, where you are, in your life in general, this is what I kind of life by in standby is how can I help other people? How can I add value? How can I go out of my way to see what other people need before myself? So there is some selflessness to that and it’s not something that necessarily gonna come easy for some people. But that’s the key to everything.
So networking, specifically, when you’re out there meeting people, whether that’s online, whether that’s like you said LinkedIn and using social media to meet people, which I love because I feel like LinkedIn, and other social media can be literally like a 24 hour, networking event 24/7 or 24/6 for me, I keep this episode online for one day, or a week at least. But for me, it’s incredible, because you meet so many people from all walks of life and from doing so many different things and if you’re thinking about well, how can I help them, your kin to listening, and really trying to figure out well, what do they need? Who do they need to meet, like who’s going to be a good person for them to connect with, and then making those introductions or making those connections. That can literally change people’s lives, and that can literally change the business that can do so many things for them.
I mean, there’s been countless times where people have asked me my opinion, do you know good sponsors to invest with, and because I’ve worked with hundreds of syndicators and real estate investors across the country in every asset class, I just had personal experience and I passively invest myself. And so I know someone happy to recommend, those who I honestly believe are good people, and are really care about their investors and are really good investments. You know, they’re not just looking out for themselves. There are some syndicators out there that are, you can tell they’re kind of more focused on ourselves as you mentioned.
There are some bad apples out there and you got to be careful. So that for me has been the biggest kind of foundation and what I’ve done, and it’s changed everything for me. I mean, that’s what really got me started in the podcast circle, to begin with, and then the networking events in person. And then online, once COVID hit, we started almost immediately saw there’s no more in-person events for the foreseeable future. I saw a couple of other people doing this, and I jumped on it immediately and started this weekly, virtual zoom meetup. We were going 18 months already, you know, going almost two years. Every single week, a different speaker, a different topic, and a lot of people coming back every single week, and certain people from that have literally they’ve met partners, they’ve met one guy literally got a new job from that. He’s now a partner in the company he works for from that meetup. People are investing together, there are some brokers in there. They’ve gotten deals from that from people, just brokers and lenders, and all kinds of things.
And it’s just putting yourself in the room, or in the virtual room, in a sense with other people who are going back to what we’re talking about for… Growth Minded People: they’re taking time out of their busy day or their evening. For me, we do it at seven o’clock Eastern so for some people that’s like, you know, that’s a hard time for a lot of people, but they take it seriously and say this is a real opportunity, not just to learn because we do have some really high-quality speakers, but to really networking and get to know people through that. So I mean, it’s been game-changing. I mean, to say that use that kind of cliche word, but it really has.
Kent Ritter 29:52
Yeah, and I think that’s fantastic. I think it’s a great case study. I’ve seen some of the impacts. Just In my own life, we host a local meetup here in town and it’s so cool when you see folks meet in it and you see deals get done through the meetup. Like we have one example where it’s like, the buyers, the sellers, and the brokers in one deal, all met each other through the meetup. I just think that’s the coolest thing about being able to see that happen and like you said, how you can change people’s lives in that way. So to do that, like, you have to be very active. You are very active in it, you spend a lot of time investing in your network. For folks that are more of a passive investors. They’re busy professionals, and they got a lot of other things going on, but they want to make good real estate investments, they need to meet good sponsors to be able to do that. What are some ideas for folks where maybe they could spend 15 minutes a day, you know, how can they be most effective?
Yonah Weiss 30:59
It all comes back to obviously, you’re right. Everyone has different schedules. Not everyone can spend as much time as I do on these things, but you have to be active, even as a passive investor, you have to be active. You have to be going anyway to try to meet more people and meet other passive investors. So maybe look up, you know, bigger pockets are a great way, on LinkedIn, or Facebook. There’s a lot of Facebook groups out there, these kinds of private groups, and you can search whether it’s local to the place that you live in, or just in general, multifamily, etc. You can meet people through those, and you kind of get to know especially if you go to some of these virtual meetups that are out there, in-person meetups, like you said, you’re going to rub shoulders, you’re going to be in the room with those people.
You’re going to make changes based on your life in whatever way that you want to base on the people that you spend time with. And so even if it’s 15 minutes a day, that’s not a lot but that can be a significant amount, in terms of finding the right people. And even listening to podcasts is a great way as well, you definitely meet people that way, and just find out about new people. Wow. I mean, I never knew that you could do things like infinite banking, and, all these kinds of different things using life insurance, just random things that you would have never heard about.
I say I’m shocked but I’m not like at this point of doing this for as many years of doing cost segregation. There’s so many people that have never heard of it before and the first time they ever hear about it is through a webinar or through a podcast or through a meetup that I’m at. And to me, it’s like, okay, now, I’m doing this, so for you talking about multifamily investing, and passively investing. For some people, they never knew that existed so keep doing that. So surrounding yourself with those types of people, because even those busy professionals, guess what, they want to leave a nest egg, to leave some wealth behind for the next generation. So you got to be proactive to help educate as many people as possible.
Kent Ritter 33:14
I think that by being proactive, you hit the nail on the head. So the easy way, which I’ve learned in life is never the best way, are you handle your money over to somebody and you say, “Man, I hope that works out”. And that’s your retirement, and you just kind of say, well, I hope it works out. The harder way that takes more time, the more difficult way is to actually take ownership of like you said, your nest egg and your retirement and what you’re going to be behind and actively manage that part of it. I think we give too much credit to folks that have certain titles or things that you would want to give your money to. I just always go back to, you know, maybe I shouldn’t say this, but you ask, in a lot of these places, you ask the financial advisors, you know, how many people in your firm or do you know that have been able to leave their job or be financially free and build that wealth and the answer is none because they’re all still there.
So my whole point is there’s a different path and the path is I think to take control of your own fight. I mean finances investments, part of that is real estate. I’m not gonna tell anybody that all of it should be real estate but the proactive piece I think, is what I want to get back to and the way that you’re proactive and it starts with networking, it starts with meeting the right sponsors, because what we’ve talked about 100 times on the show is it’s the sponsor first. A good sponsor can save a bad deal and a bad sponsor can kill a good deal. So before you start looking at markets and properties and things like just start with a sponsor network, find somebody that you resonate with. Podcasts are a great way to do that. That was how I first got introduced to a lot of different people. So I think networking, I think listening to a podcast is a great way to start.
Yonah Weiss 34:31
Kent Ritter 34:48
Well, I appreciate all the wisdom you’ve given us thus far. Before I let you go, I want to take you through our “Keys To Success” round, I will ask you four questions. The first one is, put your passive investor hat on, you know, in those deals that you’ve done, if you could only ask that deal sponsor one question, what is that? What’s the most important question?
Yonah Weiss 35:48
Here’s a question that was actually asked one time, and it was in a situation where the deal had gone awry. For no fault of the sponsor, there were things that happened, but this is a question that I think is a good test to see how a good sponsor would respond in a- I don’t want to say like an emergency situation, like something totally out of control has happened. You know, what would you do? So the question I would ask is, would you more likely to save a deal that’s gone through, you know, some something like this and the case that I’m talking about, one of the other sponsors actually had like a medical emergency and was totally out of commission. So there was no way that they could be involved anymore, which really had a dampening on the entire deal because that person was running a lot of stuff. So it was difficult so for one of the other partners, the question was, what do you do? I mean, do you bring on an expert? Do you shell out your own money from your own pocket to cover the situation? Do you do a capital call to ask investors to come back out? Meaning how would you deal with an emergency situation, and you don’t have to go into details, like the multiple-choice that I gave, but I think seeing how a person functions in an emergency is really important.
Kent Ritter 37:16
Yeah, I agree. I mean, I see all the time. I think real estate is all about solving problems. So I mean, some of those problems are bigger, obviously, as you described than others. But it’s all about solving problems. I mean, that’s really what it is. I mean, as somebody who owns the property, just things always come up. And it’s all about how to deal with them and stay calm and level-headed and always have contingency plans. I think that’s a huge lesson learned. Well, awesome. That’s a good question. The next one is, what are you most proud of in your career?
Yonah Weiss 37:49
I think giving back, being able to give back, and I do that in many different ways but just the ability to meet as many people as I’ve met is allowed me to give back to more people.
Kent Ritter 38:06
Awesome. What’s a book that everybody should read?
Yonah Weiss 38:10
If you want to learn how to network, since we spoke about this topic, I’m a big fan of the Networking Prowess of Gary Vaynerchuk. So he’s got a great book called Jab, Jab, Jab, Right Hook, and that book really kind of opened my eyes up to how to add value through networking and through marketing and so that’s just an incredible perspective.
Kent Ritter 38:38
That’s great. I have to check that out. I like Gary Vay. And lastly, what is your number one key to success?
Yonah Weiss 38:48
I think it has to do with knowing a lot and really knowing that you don’t know everything and just being open to learning and being open to listening. And so to me, that’s a success. Because for me, I define success, not monetarily, but rather, for how much of an impact I can leave, and how many people I can affect. And so doing that you have to be very humble because you have to be thinking outside of yourself. And that to me, that’s the key element.
Kent Ritter 39:15
That’s awesome. And I think we see that through your daily work. So live in the message. Thank you so much for coming on. If folks want to learn more about what you’re doing, how can they reach you?
Yonah Weiss 39:31
The best way to find me is on LinkedIn. That’s where I’m most active, gave me a little connection request. Tell me that you listened to this podcast and I’m happy to connect with you. You can also go to Yonahweiss.com if you want to learn more about Cost Segregation.
Kent Ritter 39:48
Awesome. Yonah, I’ll put that in the show notes so folks can reach you and thank you again so much for coming on the show, and have a great rest of the day.
Thanks for listening to another great episode of retire on real estate. Hit the subscribe button to make sure you don’t miss out on the content that will make you a better investor. Also, visit kitritter.com for articles, videos, and tools curated just for passive investors. Until next time, this is Kent Ritter with “Ritter On Real Estate” and go out and invest like a pro.