Working Capital The Real Estate Podcast

DIY Real Estate Investing with Brittany Arnason|EP61

Jul 7, 2021

In This Episode

Brittany Arnason is a full-time commercial real estate investor and social media influencer, commercial real estate junkie, DIY Junkie, retired power engineer, author and speaker.

  • Brittany’s Initial steps in Real Estate
  • Getting into constructing 
  • The power of Instagram and marketing
  • The ups and downs of DIY projects
  • How Brittany’s career has evolved
  • Opportunities for investing in the US
  • Her investment philosophy
  • Structuring of self-storages deals
  • Investment geography
  • Distribution of team roles
  • The impact of lockdowns
  • Mentorship, Resources and Lessons Learned

Useful links:

https://instagram.com/investorgirlbritt?utm_medium=copy_link

https://brittanyarnason.com/

Transcriptions:

Jesse (0s): Welcome to the working capital real estate podcast. My name is Jesse Fragale. And on this show, we discuss all things real estate with investors and experts in a variety of industries that impact real estate. Whether you’re looking at your first investment or raising your first fund, join me and let’s build that portfolio one square foot at a time. All right, ladies and gentlemen, welcome to working capital the real estate podcast. I’m Jennifer galley and my special guest today is Brittany Arneson. Brittany is a full-time commercial real estate investor. 

And I think you just have to take one, look at horror at her Instagram page to really get a sense of what she does. Commercial real estate junkie, a DIY jaggy, retired power engineer, author, speaker, educator, and investor. Britney. How are you doing today? 

Brittany (47s): I’m really good. Glad to be here. Thanks for having me. My pleasure. 

Jesse (51s): So we talked a little bit before the show about past guests saying that you have to have Brittany on, you have to have Brittany on, I’ve been following you on Instagram, on your DIY projects for probably over a year now, maybe longer, really inspiring stuff. So thank you again for coming on. And I think it’s going to be a treat today. 

Brittany (1m 9s): I appreciate it. 

Jesse (1m 11s): So Brittney, on the show pretty standard for us is to have guests come on, take a step back and talk a little bit about real estate in general and how they got into the industry and what their, you know, initial steps in the journey were. 

Brittany (1m 27s): Yeah, so I got started super young. I bought my first house at 18 years old and so I’ve been in real estate over 10 years now. And really I got started when I was even younger than that. Cause my mom owned rental properties and she would get my brother and I to help her out with renovations, but just kind of where you can see that DIY stuff filtering through my Instagram page, but got started with her. She would just, you know, hand me a paint brush and say, get to work kid, help me out. I can’t pay people. So I want to just get, so that was fun. 

Learned a ton from her. And then I was always really motivated throughout high school and everything to buy my first house. So, but one in Saskatchewan, if anyone knows where that is talking to it, talking to a kid from Toronto. So yeah, totally. All my American friends are like, huh, what’s the schedule. It’s kind of like in the center of Canada where all those super cheap properties are and have family out in Saskatchewan and notice that the properties were quite cheap. 

So got the first house for $25,000 for the property and rents were around 850. So tenants pay all utilities, right? So I’m like, okay, super simple math. You don’t need to know more details than that. That makes sense paid off in a few years. So, I mean, it’s funny looking back because it was kind of one of those things you’d jump in without knowing a lot, which I think nowadays it is kind of difficult for people because it’s information overload all the time. But if you keep it super simple and you don’t know all, I didn’t know anything, I never looked up anything online. 

I didn’t listen to any podcasts or books or anything. I just kind of saw an example from my mom. So I’m like, this makes sense, like put money into something and it pays you. Okay, I’ll try and do that. So, but not getting too wrapped up in all the details. So it’s interesting looking back on that right 

Jesse (3m 19s): On. So your first property was the price of a now used Honda civic, roughly. 

Brittany (3m 25s): Exactly. Right. The cool thing is too. Like I could still buy properties out there. I kind of away from the single family world now, but there’s still properties out there for that price. Yeah. 

Jesse (3m 37s): It’s funny too. You see all these online, you know, the 1% rule, the 10, whatever gross multiplier, you’re like, those properties don’t exist and it’s like, no, actually that one did that one pretty much worked out like that to have $800. Yeah, absolutely. So are you, are you, you I’m a us citizen or can, or do you have dual citizenship when you purchased it or 

Brittany (3m 59s): So, yeah, I’m from Canada. I was born just outside of Banff, Alberta, so super awesome mountain town. And that’s kind of where a lot of people where you see the real estate market is just insane. Right? So when my parents moved there in the nineties, everything was dirt cheap. Like it’s $40,000 for a house or something. And now it’s probably worth over 2 million. It’s just like absolutely ridiculous, but so grew up there. And once I started in real estate, I moved out to Saskatchewan and because that’s where the cheap properties were and I had some family around there. 

So, you know, I just really wanted to be successful in real estate. And I’m like, how can I make this work? And if I’m just starting out, don’t have a ton of money and all that sort of thing. So that’s kind of where I went because Ken was ridiculously expensive. So got it. Yeah. Get out of that town. But now I have been living in the states last six months and just have a working visa right 

Jesse (4m 53s): On. So at 18, I mean, not everybody’s thinking about buying properties and growing a portfolio. So you had the parents with the rentals kind of, you know, got the edge from there to where you are now. I’ve seen, you know, the, the DIY projects that you do. How did you jump into actually constructing and maybe part of that is that a, you are a retired power worker. So arranger, that’s what Brandon said on the that’s amazing. He would a power engineer, I should say. 

Yeah. So, so how did, like, what was that story like? 

Brittany (5m 29s): Yeah, so I really got into power engineering because it was a job that I could, I could get my certificate within six months and then get a really high income and I wanted the high income so I could buy real estate. So the end goal was always, I want to get that paycheck so I can buy real estate. But then I worked as a power engineer for six months, which was awesome. I learned a ton and I really liked the hands-on stuff. So it’s fixing machinery and all this sort of thing, but working in it for six months, I just, I, for a fact, I already knew this beforehand, but I was like, this nine to five life is not for me. 

So I kinda got out of that as quick as I could and jumped into real estate. Full-time so use the advantage of having the W2 income. I always say the T4 or W2, whatever, but use that to get some lines of credits and mortgages and all that sort of thing. And then I’m like, well, I got to get out of this and do my own thing. So, and actually started during that job is when I kind of started my whole Instagram page and started to really get involved in the networking and creating that credibility for myself, for 

Jesse (6m 36s): Sure. And I mean, like, just for those that, that are living under a rock, haven’t seen your page, I think it’s your summit 215,000 followers on Instagram, just as an aside. What was that like just, you know, from you posting your first stuff. Cause I I’m, I’m almost positive. Maybe it was a year or two years, but I don’t think you were at that level yet. So what, how did that kind of, how did that evolve that, you know, everything you started posting? 

Brittany (7m 2s): Yeah. Well, that’s a good question because it is really hard when you first start out because it takes so much time to it’s trial and error and it’s a lot of consistency. It’s hard because you can’t really see the long-term benefits when you’re first starting out. And you’re like, this is just a lot of time and frustrating, right? Because it’s not getting the engagement and you don’t really know what to post super own. Sure. But for me it was just that trial and error. So I, when I first started, I actually had a mentor. I was at a real estate kind of meetup, super new. I think I had three properties at the time, but a mentor told me, you know, you have to do something as a new investor, you have to do something to create credibility for yourself. 

So he suggested, you know, starting a blog or a newsletter or an email list or something like that. And so that’s what I did. I started a blog and I called it little investments on the Prairie’s. So, cause I was buying these little property. That’s pretty cute, but I’m not writing, isn’t my strong suit. So I try to take me so long to write up these blogs and it wasn’t really gaining a lot of traction. So I started, I didn’t have Instagram beforehand, but I thought, you know, I really liked the photos and the videos and that sort of thing. I always kind of had that artistic kind of sense, I guess. 

So I started with Instagram and I named, I think I had that name for my Instagram as well, little investments on the Prairie. It was just super long. And I’m like, okay, I’m not getting anywhere with this. And then I saw a girl, her, her handles thought it was girl. And I’m like, how would invest a girl best to grow Brit? And that’s where that kind of started. So it was a little, a little bit trial and error and figuring out what works. But I do suggest for people to have their, their first name or something to do with it because now when people type investor on Instagram might have wanted to come up. 

So I love having my first name, but also the word investor in there. Cause that’s what I’m all about. So yeah. And, 

Jesse (8m 51s): And it’s, I mean it is, is I think it’s topical and it’s important. You mentioned where the credibility pieces, because you just see so many people in our industry online, you know, you don’t know what I can only imagine at this time, like I started investing, you know, the same, roughly the same age you were, I was 19 turning 20. And at that time you had magazines, you had like a few magazines, BiggerPockets was in its infancy and now there’s so much information and you don’t really know, you know, what to, what to really go to what’s credible. 

So having that credibility building, whether it’s an ebook or like, like you said, you started a page. I could totally see where you’re coming from the blog. I feel like it’s a lot of effort with potential, you know, not exactly a lot of, if there’s not output from the blog, you’d be like, why am I doing all this? This is a lot of 

Brittany (9m 40s): Work. Totally, exactly. And what’s good about Instagram is the stories too, where people can really get to know you as an individual and see that behind the scenes. So when I was renovating properties, it’s not fun all the time, you know? So I try to show all the ups and downs and, and get in bed to, to invest in. Cause that’s relatable. Cause it’s the truth about it. It’s not all fun all the time and highlight reels. It’s actually, no, this is real life and this is hard. So I think, I think that’s, that’s a good way to go about it, to just be your authentic self and not trying to be any, you know, like show, tell people what your goals are, what you’re trying to do and, and just grow your network that way. 

And people can really start to relate to you. 

Jesse (10m 22s): Yeah. And I think there is something about Karabakh Backman, who was, who was on the, the show last year. She does, you know, has DIY projects as well. I think there’s something about just humans in general, when you see the before and afters, regardless of it’s, you know, weight loss, or if it’s a real estate fix and flips, there’s something about that that were like, it’s satisfying seeing that. So I think like you hit a perfect niche where, you know, you have a education, you have investments that you’re doing, but you’re also seeing a product and what it potentially could be 

Brittany (10m 52s): Totally. And it’s, it’s that transformation like any good movie or story or anything it’s like, the character is not the same at the beginning as they are end, but you know, it’s that real life situation and people are kind of looking for, for some somebody to connect to. And that’s why we have our little drugs as real estate investors, I think, cause it’s, it’s difficult to stay motivated all the time when things aren’t going always the right way or, or you want to be able to celebrate your wins with people. And yeah, I think it’s a really good way to do it. 

Jesse (11m 20s): Yeah. I have a mentor of mine that he’s always saying, you know, tell, you know, teach in stories and explain in stories and when you really grasp it, you’re like, wow, it does, you know, when you hear somebody talking like that, you initially, you know, you’re engaged because like you said, it’s a journey. I don’t know if it’s, I think it’s just a human tendency. So you start down this path of doing DIY projects, maybe for listeners, you could pull one of the, maybe not the first one, but a one in the past that you did, that was kind of your first foray into that world. 

And what were some of the challenges during that time? 

Brittany (11m 59s): Yeah. So lots of the renovation stuff was, and I would go out. So even during the power engineering job, I’d drive four hours out to a property and then stay there over the weekend, renovate it and then drive back home like four hours back. It was a lot, but it was, it was something that I just, you know, is that sacrifice you kind of honestly have to make if you’re a new investor and you’re just trying to get in the game. It’s like, okay, do I have to, because a lot of people also get stuck in an expensive market. So I was looking outside of the market just to see, okay, what makes sense? 

This, this house cost $40,000 and it’s going to bring in 1200 a month. So, you know, that’s go for that. And it was kind of just always looking, not knowing exactly all the answers, but, but finding the ones where the numbers did make sense and then being able to, so it was kind of going and Burr was the main strategy at that time. I’ve moved more into the commercial real estate stuff now, but, but with the single families, it was all bird projects. So it was get in there, renovate them, build up that equity and then rent it out, pull out that money and then move it on into the next one. 

But a lot of these projects too, it was just, you know, how can I make this work? There’s always rope, roadblocks and things problems happening. So it’s okay. It can get a mortgage for this $40,000 property. But I asked a whole ton of banks and they said, we can’t give you a mortgage for this. These are the reasons. But what I can do is give you a personal line of credit for $75,000. I think it was. So it was a $75,000 credit they gave me. And so I was able to purchase the property and get a renovation costs and then refinance after that. So it was, it was good. 

Like there’s just, I feel there’s always a way there’s always a partner bank or someone else to talk to, to get the project moving forward. Yeah. 

Jesse (13m 39s): I think if, you know, even one of the deals we’re doing right now, we’re raising capital for, and you know, even when it’s on the goal line, you’ve closed or sorry, your all the deal sort of the APS, the purchase and sale agreements finish, you have your closing date everything’s should be smooth sailing. And then there’s always something, oh, we have an encumbrance, oh, there’s a lien. Oh, we just did title search. And I think it’s as investors, you do that once, twice 20 times, you start just, you know, that one thing you can expect is that there’s going to be something that comes up that you’re going to have to handle. 

And if you can’t do that, you’re probably in the wrong industry 

Brittany (14m 12s): And it just gets easier over time. It’s like those problems. Cause I think back to those days renovating the property and it was so frustrating, you know, learning how to do these renovations and all this stuff. And then all this pro tenant ruin this flooring or something like that. And then it’s so, so overwhelming. And, and then, and then you look back at where we’re at now and those problems are small, but you can’t see it when you’re in it. So I think that’s just important for people to know if you’re just starting out or you know it, and it’s just new, new levels, new problems all the time. 

Professional problem solving problems. Yeah, exactly. 

Jesse (14m 49s): I was having this like joke or debate with a few of my buddies and we were talking about just, you know, what you would leave for your kids. And something came up, would you leave a property to your kid? And, and we were talking about smaller prop properties if you had a kid. And I was like, somebody brought up the idea of it being a gift. And I was like, honestly, you give a rental property with a bunch of headaches as a lesson to your kid. Not as a gift, 

Brittany (15m 14s): That’s a good plan because 

Jesse (15m 15s): I was, I mean, it was the same for me at, at, you know, 19 20, 21, maybe a couple of years older where you’re learning how to do things that you would otherwise not have had to do. What’s a S what’s a C trap. Why am I doing, why am I mudding? Like everything to do with actually fix, fixing up? Because the reality is if you buy single family houses in the beginning, you are doing things that you can outsource as much as you want at that point. You’re, you’re going to actively do things in the property. And it sounds like for you, you took it to the next level and you’re actually doing the brewer strategy and like going in with the idea, I’m going to add value to this and refinance. 

Brittany (15m 52s): Exactly. Yeah. So how has, 

Jesse (15m 55s): How has your portfolio, or what you’re doing now, you mentioned commercial real estate. How has that evolved over the years, Brittany? 

Brittany (16m 3s): Yeah. So got up to, you know, a few single family duplexes and then the last purchase was apartment building. So 27 doors now, and those are all in Canada. So those it’s been great. It took a while to get the process of handing everything over to property management and getting bookkeepers. But I read a book called who not how, I don’t know if you’ve heard of that one. Dan Sullivan. I think Dan Sullivan’s author Benjamin Hardy. Yeah. So I love that book and that really changed my mindset along with some mindset coaching and stuff like that. 

So it’s just kind of getting myself, cause I kind of did get stuck in this DIA DIY mentality. And I was like, I just love the work. I’m going to do this every day. But I was kind of just in my comfort zone, but I, I always had this in the back of my head. Like, no, I want to expand. I want to do more. I want to scale, but it’s really hard to scale when you’re and I was tying myself to the property cause I was building myself into this job of having to do renovations to the property completely. So I was living there. I was like sleeping on the floor and all the drywall dust. 

And I was like, okay, this isn’t working for me anymore. It was awesome at the time I was so glad I got started in that and learned so many lessons, but it got to a point where it just, you know, I just had to make a mindset shift and I was reading who, how do mindset coaching and all this. And, and it wasn’t what I wanted. I was telling myself that, but it wasn’t actually truly what I wanted because the main goal in real estate was that time and location freedom. And I wasn’t, I wasn’t doing that for myself because I was just doing renovations all the time, every day. So I still like to do the DIY stuff and I love that kind of work. 

I love being hands-on, but that’s more of a hobby now for me, rather than just my main real estate investing strategy. So, but it was really curved. Did Joe or good too, I guess. I don’t know. It’s kind of funny. It’s like when you started real estate and then it was really difficult and then you get to a plateau like, oh, everything’s easy. And then it’s like, I don’t want to scale. And then you could try to get to the next level. So that’s kind of what I’ve been transitioning into, but it’s been, it’s been awesome. So yeah, 

Jesse (18m 9s): I, I think it’s for people that have been successful too, it’s like everybody, or nobody’s immune to feeling comfortable. And even though your comfort in flipping houses, might’ve been way out of somebody else’s comfort zone because they hadn’t gotten to that level or maybe didn’t want to, you know, that wasn’t something they wanted to do, but then you get to that level and you continue to do it for a while. And then yeah, like you said, you get comfortable and you have mentors or coaches to constantly push you and be like, well, what do you really want to do? And I, I totally hear your point of, you know, we talk about freedom and not having a job. 

And then all of a sudden we’re busy. We’re the busiest person we know. 

Brittany (18m 45s): I think, I always think it’ll always be that way because you get to this point for a reason because you are that way and you’re like, let’s go, that’s progressing, moving forward and, and the trial, and then you just start to, you know, want to do more bigger projects, but you want to be able to have the choice of it. I think that’s where it, 

Jesse (19m 4s): Yeah, it was just reminds me of the matrix, the illusion of choice. Yeah. So the 27 doors in the great white north tell, tell us about 

Brittany (19m 13s): Them. Yeah. So mostly in Saskatoon is kind of the main hub. So I have a few duplexes out there and then kind of just went all surrounding areas where the cashflow made sense because it was just in, and I always tell people this because people do get really stuck, especially Canadians, I think, cause they’re such expensive markets like Toronto or Vancouver. And then you really have to kind of look into those other areas like Saskatchewan, cause there’s lots of industry there there’s, you know, tons of renters and not a ton of nice places to, to rent. 

So that was kinda my thought process behind that. It’s like, okay, create this really nice rental in this smaller area, but it’s, there’s never a problem with vacancy and there’s no appreciation, so that’s the trade, right? Like there’s a little bit through the forced appreciation with the renovations and then a little bit of, you know, passive appreciation as well with the market, but it’s not a ton. So it’s a different strategy between Vancouver and in Toronto and those types of areas, but then still it’s solid cashflow. Yeah. 

 

Yeah. So I think that was kind of the thing. It was just kind of looking at these smaller centers, seeing where there is heavy industry, but a lot of the workers, like for example, the apartment building, that’s 14 units, there’s a ton of transient workers. So they’re there for maybe a year or two and they don’t want to buy a house because why would they buy a house if they’re not going to be there forever? So they’re kind of just not committed to buying a house, but they will pay top dollar for rent, like same as city prices, but you know, could buy the apartment building cost 450,000. So for units, and then, you know, now some of the bachelor units are getting, I think it’s 850 rent for a bachelor unit. 

 

So yeah. But yeah, and then it takes care of all of it too. So now I’m just like, yeah, free. 

 

Jesse (21m 4s): It’s so true though. Like the 450,000 and like, you know, you, you move into some markets and that’s how much it is a unit. Like you go certain, especially smaller multi-family in Toronto. It’s I tell people that come on the show that if they’re from New York, they can kind of understand if they’re from San Francisco, any of those really extremely hot markets, Vancouver and Toronto would be in that same category. I’m curious. So last time I was at west, it was no boarding out in Whistler, so I didn’t get a chance to stop and, and in Saskatoon, but I’m curious out, out in Western Canada, are we starting to see more manufactured housing that, you know, everybody in the states that comes on my show has either something to say about manufactured housing or is that investing in it? 

 

Brittany (21m 49s): Hmm, no, I don’t really do much of that now, especially right now I’m kind of focused actually more on the U S market. So I haven’t really been that involved in actually dosing actually. 

 

Jesse (22m 1s): Yeah. Right on. So for yourself, I mean, just on that point, looking at investing in the states, what are, what are some of the opportunities you’re looking at right now and what do you think, you know, we have in store in the next year or two, just in, in that regard and opportunities? 

 

Brittany (22m 17s): Yeah. Well I’m really, really excited right now because so through, you know, actually through social media and online and everything I got on bigger pockets podcast. And so that was a few years ago now, but I created some really awesome connections and, and really great friends. Some of my best friends, I met through bigger pockets and going to a Maui mastermind that Brandon Turner hosted. So he just kind of picked 20 people out of his fall or people that he was following on Instagram or whatever created this little mastermind group. And that’s where I made some really amazing friends. 

 

And, you know, I have, I started to focus this year, just on my strengths. What am I really good at? And you know, my reach through Instagram and everything like that and partnering with these expert operators because ADA Osborne, which is where I’m at right now, I’m in Boise, Idaho working with AGA Osborne. And he’s an incredible operator and industry leader in self storage. So they have, you know, over a million and a half square foot of storage right now and they’re just rapidly expanding their portfolio. So I’m kind of on the acquisition side of it. 

 

It’s, you know, reaching out to brokers and my Instagram audience and everything, looking for self storage facilities to either do value, add projects with or development site as well. We’re working on a big development hero in Boise. So that’s going to be started right away. And I’m just really excited about it. So being on a team, cause I was always, you know, focused on is working on like, oh, like kind of doing, I was like DIY everything, all, all of it. But now what I realized is what I enjoy doing. 

 

What I like doing is the collaboration and working with these incredible operators, they already have all their systems. They already have, you know, amazing network, like everything all sorted out. So what, what I’m doing is bringing investors into these projects and helping with acquisition side and everything too. So right now it’s been like self storage, everything. So there’s a ton of opportunity in that right now. What’s cool too, about storage is that the fragmented market? So 72% of the self storage facilities are owned by mom and pops. 

 

So it’s funny. Cause I was, I actually had a self storage facility, I think a year ago under contracting in Canada. But what I was doing is just kind of going around cold, calling a bunch of owners and just saying, you know, it’s funny cause you call the number, doesn’t it don’t pick up. Like they don’t pick up. And then once in a while they’ll pick up like, hello, I’m like, oh hi, I’m looking to rent a storage unit. Oh yeah, let me just call you back. Sure. So that’s not managed correctly. And then, you know, you make an offer and go from there. 

 

So that’s, that’s, what’s pretty cool about self storage and you know, a recession recession resistant asset class as well because even through COVID, it’s just performing super strong and there’s a lot of people moving and there’s a lot of people downsizing at this time. So storage is very needed during this time, but it’s been one of the, you know, growing asset classes the last 20 years. And there’s a lot of, lot of opportunity with that fragmented market if you’re able to go in and really expertly turnaround the operations. 

 

So it’s immediate value add with the existing facilities with through operations. 

 

Jesse (25m 33s): Yeah. We’re seeing a lot of, a lot of self storage. Sorry, sorry to interrupt 

 

Brittany (25m 37s): There. Continue. 

 

Jesse (25m 39s): Yeah, no, I was just going to say we’re, we’ve been seeing, I think it’s everywhere. I think a self storage is one of those areas that there’s just a lot of attention and I think you’re absolutely right. It’s there’s just a large percentage of mismanagement, I think where there’s operations, like you said that you can immediately add value. I’m pretty sure Aja is also speaking actually quick shout out to your speaking at BP con 2021 new Orleans. It is happening. I’m speaking as well. And I’m pretty sure AIG is as well. I think he’s on some sort of panel maybe talking about self storage. 

 

So yeah. So there’s that there? So as a, as a, I guess in this case, somebody that’s investing from outside, cause you’re on a visa. Is, is that any different in terms of how you invest? Do you ha are you creating a different structure for the investments when you go in with operating partners? 

 

Brittany (26m 34s): Yeah. So right now I’m on a working visa. So for me it’s a little bit different and I still have a company in Canada, but I’m actually employed now by Cedar Creek wealth, which is a data company. So I’m employed through them and I’m able to make my positive investments. It gets a little bit complicated. Like the syndication side is easy. Cause you can invest quite easily as a Canadian. You just have to set up your holding company and then it kind of goes through that way. And then you save on taxes, but I’m not trying to give tax advice. So that’s the disclaimer, but that’s how people, so I have quite a few Canadians now as I was presenting these opportunities to my audience, like quite a few of them are Canadian. 

 

So it’s just, it’s, it’s awesome because there is so much margin with returns, especially in storage. So I mean there’s a lot of opportunity for investors as well and Canadians as well. Cause I mean, yeah, I guess people do, I’m like everybody can join 

 

Jesse (27m 36s): These, the self storage. Cause we’ve, I mean, we talked a lot on the show about, you know, different syndications, a limited partner, general partner type structures, the self storage are they, are they structuring them pretty much similar to other real estate investments where you, you have an operator, you have multiple limited partners or are you doing something different? 

 

Brittany (27m 57s): Yeah. That’s pretty much how it’s been so limited partnership. And then it’s, it depends on the deal. So we do both right now, the development deal was structured a little bit differently, but then from the existing facilities, but yeah, it’s a 60 40 split. And then we have a waterfall structure after the investors for this specific deal, it was after 120% return. And so the investors get their returns and then it splits the waterfall structure happens. 

 

So it’s turns from a 60%, the LPs to 40% of LPs. And then yeah, 

 

Jesse (28m 34s): I have a, basically a preferred return built in and with each, each IRR or each percentage return, you have a different split for, for 

 

Brittany (28m 43s): Exactly. And we’re getting into it cause so AAJ has not done a ton of syndications that he just recently started to cause they’re rapidly growing their portfolio and have so much on the go. And there’s so much opportunity right now. So that’s when it pretty much just started with the syndication side right now. And that’s where my role has kind of been as well. So it’s just kind of a whole new thing where we’re, we’re getting all, we’re trying to get all of these investors in because it’s so fun to be, you know, providing these opportunities to people. 

 

So I’ve, I’ve had a lot of fun with that as well because you know, starting my Instagram page too, I never thought I’d be in a position where I could like provide these opportunities to people and it’s like, wow, this is crazy. You’re like I have the funnel. I know do these massive deals together. So yeah. Yeah. Definitely fun. Yeah, 

 

Jesse (29m 35s): No, that’s really cool. And I think the, just the private placement or the exempt market has been blowing up, it’s always, I mean, it’s been a big part of the market. I don’t think a lot of people that aren’t in our industry or say the movie industry or oil and gas realize how so much money is raised through just private placements and, and that’s the market that oftentimes that we’re dealing with. But I think it’s something that is really blowing up. I know for, you know, Canadians the fact that we’re hearing about syndications and more and more people doing them up here when we are pretty conservative, when it comes to investing, I think is just kind of an illustration of that. 

 

So in terms of, you said you’re in Boise right now in terms of the geography that you’re investing in right now, is it focused on one specific market or are there a number of markets that you’re looking at? 

 

Brittany (30m 24s): Oh, looking all over, especially with storage, there’s opportunity all over the country. So looking for a population in a that’s growing 30,000 people plus, so kind of looking at that. So there’s lots of options there, but yeah, we’re kind of all over focused in Texas, Oklahoma city, Kansas city. Boise’s an awesome market. That’s where new development project is and it’s just growing like crazy, so super hot markets and, you know, looking for that. 

 

And then we, we have a lot of different ways. So I’m, I’m getting actually a lot of people sending me deals through Instagram, we’ve been in and we’re looking for a storage facilities, 60,000 square feet plus, and you know, so and value add. So if there’s any problems that we can solve, we’re pretty good at solving those problems. And then we’re able to turn them around pretty quickly. So that’s kind of what we’re looking, we’re open to really any market, but as long as we, you know, we go in and do our deep dive of course, but it’s, that’s kind of the general criteria. 

 

Jesse (31m 26s): Nice. So I can only imagine your inbox is just probably hammered on, on Instagram. 

 

Brittany (31m 31s): I know all the VA’s and that’s like the other part of it. Cause I need to, you know, I’m in the phase of just hiring people out to help with all the organization of everything as well. So that’s been really fun cause I’m used to doing everything on my own, but like this past year it’s been definitely awesome to have this team around me and people on my side helping me out and to your point, who not, how not, how exactly changed everything 

 

Jesse (31m 58s): Point there, the team, what is the, what does the team look like right now in terms of the investments that you’re doing? So, you know, AIJ, you know, in storage, for example, you know, there’s the analytical, there’s the operator, there’s the market like where do you fall in that? And you know, who are your indispensable team members? You don’t have to say their names, but just kind of the roles they do. 

 

Brittany (32m 19s): Yeah. So I mean the ADA’s team is 35 plus people. So there’s definitely a lot, but then there’s the construction manager, acquisitions manager and myself, I’m kind of helping with the acquisitions and then syndication side. So that’s kind of been my role and just kind of, you know, getting out cause we do a lot of on the education side as well. So there’s an inner circle and you know, there’s a lot of ways and that’s the other part of it too, because once we get so many deals coming into us, maybe they don’t exactly meet our criteria, but we’re able to completely analyze them and help other investors out. 

 

If there’s people who want to buy these, maybe a smaller facility, that’s less than 60,000 square feet. So there’s a lot of opportunity in that as well, sharing these extra deals kind of with it, that investors. So, but yeah, there’s, there’s a big team. They’re really incredible with their operations and they have everything super streamlined. So taking Wilbur can flip them round super quick and get things on the operation side happening really fast. Very 

 

Jesse (33m 19s): Cool. So we’re, we’re almost coming up to the time here, but before we, before we kind of get into four questions, we asked every guest on the show. What I’d like to do is talk a little bit about the current environment that we’ve been living through, you know, from call it the last year and a half. Just what your experience has been like over this time, you know, as there been some, you know, wins or losses and what you think the opportunities over the next few years are going to be, or is there anything you’re doing differently as a result of what we’ve experienced? 

Brittany (33m 54s): Yeah, well I think for me, it all my rentals have, I had a few, you know, tenants to work with who lost their jobs here at COVID. And so helping them out, you know, get things kind of a little bit more on track with them. But other than that, everything has been pretty stable and it’s been a little bit, you know, it has been a way different year for me, but not really due to COVID. It was more due to my mindset expansion and trying to get into the commercial real estate space and working with expert operators who, you know, they, they know every single little detail and I’m like, okay, I can team up with the people who already analyzing every single little detail about everything there is to know, and if I can team up and help them with, you know, what I’m an expert at, that’s where I kind of want to be. 

So it’s been really fun connecting with these other operators in the spaces, but we’re just, there is a lot of opportunity right now. There’s a lot of changes happening with, in the states and everything with the 10 31 and there’s all the talk of everything, but it’s just kind of adjusting and pivoting and, and not being kind of intimidated, but just kind of analyzing and knowing, you know, we can mitigate a lot of risk in that way just with our experience, but yeah, yeah, for 

Jesse (35m 10s): Sure. I think it’s just a matter of kind of being prepared. There’s really nothing we can do if, whether it comes to capital gains 10 31 exchange, which as, you know, we, we don’t have here, so we’re just roll our eyes. Okay. You’re going to lose it potentially. Very cool. So Britney, we ask guests on the show, we’ve touched on some of them, but pretty much four questions, pretty, pretty softball questions, everybody at the end of the show. So if you’re game for that, I throw them at you. 

All right. One thing that you know now in your career that you wish you knew when you got started at what was a young age of 18. 

Brittany (35m 50s): So I think starting to build that credibility for yourself, you know, getting out there, building your network. I think that was a huge for me and I didn’t see it at the time, but now I can definitely see how beneficial that is. So getting out there and starting building your network, you know, there’s so many places you could go online and start posting in groups and everything. Even if you’re a new investor, just get started now because it’s intimidating posting. If you feel like you don’t know what you’re talking about yet, it’s really hard to post. Cause you’re like, feel awkward. Like, oh, I’m not an expert yet, but just start as soon as you can because people kind of connect to you no matter what stage you’re at. 

Jesse (36m 27s): So you touched on it a little bit earlier. I think everybody’s on the same page when it comes to mentorship, especially in our space, but your views on mentorship and maybe in the context of, you know, younger people getting in the industry, you know, what would you say to them? 

Brittany (36m 42s): You have to prove yourself because I think there’s a lot of people that just take, take, take, they want one while all these things, but you really have to get out there and provide. So for me, you know, when I was starting, my, I didn’t even have a thousand followers, I don’t think. And I was posting on Instagram listening to bigger pop cause I was talking to my mentors and saying, oh, listening to BiggerPockets. This is what I learned on this episode, tag run and take Josh or David or whoever was hosting at the time and, and, and try to provide value for them by just, you know, shutting up their work and being like, okay, you guys should buy their books. 

You guys should do this to my little audience that I had at the time. But then that was kind of gaining this attention. And I was just working really hard every single day and mentors and people, they can see that they can see the people who are really trying willing to take advice and actually implement it and put it into action. But mentors, mentorship for me has been everything. And I have a lot of really awesome people on my side, but it’s through that hard work that they’re, they’re going to want to help and continue to. Yeah, 

 

Jesse (37m 39s): For sure. I mean, especially with the social media now, if you’re a champion of something that you find interested at, first of all, I think it’s shines through, you know, if you’re excited about it, but also just with social media, you’re able to connect directly with that person. You know, it’s something where, you know, 10 years ago, if you really liked a book, you could call the author, but now you kind of, you have everything at your fingertips if you want to take advantage of it. Totally. So in terms of, so question number three for you here, you already mentioned who not how, but is there any other resource or book that you, you know, you’re using that you’d recommend to any of the listeners? 

Brittany (38m 16s): Yeah. Huna has a really good one, crushing it in apartments and commercial real estate by Brian Murray. He was another mentor of mine and a really awesome friend. He’s just the best. So that’s been one of my favorite books and that really started to change my mindset from single family to commercial real estate. And I do suggest, you know, getting cut cause it takes a long time. Right. So I read that book two years before I bought my first commercial building, but it was always in the back of my head, like, okay, you know what we’re going to get started, but just like getting in that mindset sooner rather than later. 

 

Right 

 

Jesse (38m 48s): On. All right. My favorite question, first car, make and model. What are you strolling around Saskatchewan with? 

Brittany (38m 58s): Well, I had a Ford, 1995 work van. So that was that that’s a good one because that’s like a vehicle plus a house. So, and having just sleep in that for years. So yeah, be creepy if I was driving it, but I guess it’s a normal 

 

Jesse (39m 15s): Vehicle and Northern Canada. Awesome for listeners, Brittany, obviously. I mean, you’re a Google search away. Like I always say on the show, but if people want to connect with you or see what you’re doing, see what you’re up to in terms of investment, anything really, what’s the, what’s the best place that they can go to? W we’ll put a link in the show notes. 

 

Brittany (39m 40s): So investor, girl grits, my Instagram page, that’s where I post most of my stuff. And then my website, Brittany arneson.com. 

 

Jesse (39m 48s): My guest today has been Brittany Arneson Brittany. Thanks for being part of working capital. Thanks so much for having me. Thank you so much for listening to working capital the real estate podcast. I’m your host, Jesse for galley. If you liked the episode, head on to iTunes and leave us a five-star review and share on social media, it really helps us out. If you have any questions, feel free to reach out to me on Instagram, Jesse F R a G a L E, have a good one. 

Take care. 

Transcript

ions:

Jesse (0s): Welcome to the working capital real estate podcast. My name is Jesse Fragale. And on this show, we discuss all things real estate with investors and experts in a variety of industries that impact real estate. Whether you’re looking at your first investment or raising your first fund, join me and let’s build that portfolio one square foot at a time. All right, ladies and gentlemen, welcome to working capital the real estate podcast. I’m Jennifer galley and my special guest today is Brittany Arneson. Brittany is a full-time commercial real estate investor. 

And I think you just have to take one, look at horror at her Instagram page to really get a sense of what she does. Commercial real estate junkie, a DIY jaggy, retired power engineer, author, speaker, educator, and investor. Britney. How are you doing today? 

Brittany (47s): I’m really good. Glad to be here. Thanks for having me. My pleasure. 

Jesse (51s): So we talked a little bit before the show about past guests saying that you have to have Brittany on, you have to have Brittany on, I’ve been following you on Instagram, on your DIY projects for probably over a year now, maybe longer, really inspiring stuff. So thank you again for coming on. And I think it’s going to be a treat today. 

Brittany (1m 9s): I appreciate it. 

Jesse (1m 11s): So Brittney, on the show pretty standard for us is to have guests come on, take a step back and talk a little bit about real estate in general and how they got into the industry and what their, you know, initial steps in the journey were. 

Brittany (1m 27s): Yeah, so I got started super young. I bought my first house at 18 years old and so I’ve been in real estate over 10 years now. And really I got started when I was even younger than that. Cause my mom owned rental properties and she would get my brother and I to help her out with renovations, but just kind of where you can see that DIY stuff filtering through my Instagram page, but got started with her. She would just, you know, hand me a paint brush and say, get to work kid, help me out. I can’t pay people. So I want to just get, so that was fun. 

Learned a ton from her. And then I was always really motivated throughout high school and everything to buy my first house. So, but one in Saskatchewan, if anyone knows where that is talking to it, talking to a kid from Toronto. So yeah, totally. All my American friends are like, huh, what’s the schedule. It’s kind of like in the center of Canada where all those super cheap properties are and have family out in Saskatchewan and notice that the properties were quite cheap. 

So got the first house for $25,000 for the property and rents were around 850. So tenants pay all utilities, right? So I’m like, okay, super simple math. You don’t need to know more details than that. That makes sense paid off in a few years. So, I mean, it’s funny looking back because it was kind of one of those things you’d jump in without knowing a lot, which I think nowadays it is kind of difficult for people because it’s information overload all the time. But if you keep it super simple and you don’t know all, I didn’t know anything, I never looked up anything online. 

I didn’t listen to any podcasts or books or anything. I just kind of saw an example from my mom. So I’m like, this makes sense, like put money into something and it pays you. Okay, I’ll try and do that. So, but not getting too wrapped up in all the details. So it’s interesting looking back on that right 

Jesse (3m 19s): On. So your first property was the price of a now used Honda civic, roughly. 

Brittany (3m 25s): Exactly. Right. The cool thing is too. Like I could still buy properties out there. I kind of away from the single family world now, but there’s still properties out there for that price. Yeah. 

Jesse (3m 37s): It’s funny too. You see all these online, you know, the 1% rule, the 10, whatever gross multiplier, you’re like, those properties don’t exist and it’s like, no, actually that one did that one pretty much worked out like that to have $800. Yeah, absolutely. So are you, are you, you I’m a us citizen or can, or do you have dual citizenship when you purchased it or 

Brittany (3m 59s): So, yeah, I’m from Canada. I was born just outside of Banff, Alberta, so super awesome mountain town. And that’s kind of where a lot of people where you see the real estate market is just insane. Right? So when my parents moved there in the nineties, everything was dirt cheap. Like it’s $40,000 for a house or something. And now it’s probably worth over 2 million. It’s just like absolutely ridiculous, but so grew up there. And once I started in real estate, I moved out to Saskatchewan and because that’s where the cheap properties were and I had some family around there. 

So, you know, I just really wanted to be successful in real estate. And I’m like, how can I make this work? And if I’m just starting out, don’t have a ton of money and all that sort of thing. So that’s kind of where I went because Ken was ridiculously expensive. So got it. Yeah. Get out of that town. But now I have been living in the states last six months and just have a working visa right 

Jesse (4m 53s): On. So at 18, I mean, not everybody’s thinking about buying properties and growing a portfolio. So you had the parents with the rentals kind of, you know, got the edge from there to where you are now. I’ve seen, you know, the, the DIY projects that you do. How did you jump into actually constructing and maybe part of that is that a, you are a retired power worker. So arranger, that’s what Brandon said on the that’s amazing. He would a power engineer, I should say. 

Yeah. So, so how did, like, what was that story like? 

Brittany (5m 29s): Yeah, so I really got into power engineering because it was a job that I could, I could get my certificate within six months and then get a really high income and I wanted the high income so I could buy real estate. So the end goal was always, I want to get that paycheck so I can buy real estate. But then I worked as a power engineer for six months, which was awesome. I learned a ton and I really liked the hands-on stuff. So it’s fixing machinery and all this sort of thing, but working in it for six months, I just, I, for a fact, I already knew this beforehand, but I was like, this nine to five life is not for me. 

So I kinda got out of that as quick as I could and jumped into real estate. Full-time so use the advantage of having the W2 income. I always say the T4 or W2, whatever, but use that to get some lines of credits and mortgages and all that sort of thing. And then I’m like, well, I got to get out of this and do my own thing. So, and actually started during that job is when I kind of started my whole Instagram page and started to really get involved in the networking and creating that credibility for myself, for 

Jesse (6m 36s): Sure. And I mean, like, just for those that, that are living under a rock, haven’t seen your page, I think it’s your summit 215,000 followers on Instagram, just as an aside. What was that like just, you know, from you posting your first stuff. Cause I I’m, I’m almost positive. Maybe it was a year or two years, but I don’t think you were at that level yet. So what, how did that kind of, how did that evolve that, you know, everything you started posting? 

Brittany (7m 2s): Yeah. Well, that’s a good question because it is really hard when you first start out because it takes so much time to it’s trial and error and it’s a lot of consistency. It’s hard because you can’t really see the long-term benefits when you’re first starting out. And you’re like, this is just a lot of time and frustrating, right? Because it’s not getting the engagement and you don’t really know what to post super own. Sure. But for me it was just that trial and error. So I, when I first started, I actually had a mentor. I was at a real estate kind of meetup, super new. I think I had three properties at the time, but a mentor told me, you know, you have to do something as a new investor, you have to do something to create credibility for yourself. 

So he suggested, you know, starting a blog or a newsletter or an email list or something like that. And so that’s what I did. I started a blog and I called it little investments on the Prairie’s. So, cause I was buying these little property. That’s pretty cute, but I’m not writing, isn’t my strong suit. So I try to take me so long to write up these blogs and it wasn’t really gaining a lot of traction. So I started, I didn’t have Instagram beforehand, but I thought, you know, I really liked the photos and the videos and that sort of thing. I always kind of had that artistic kind of sense, I guess. 

So I started with Instagram and I named, I think I had that name for my Instagram as well, little investments on the Prairie. It was just super long. And I’m like, okay, I’m not getting anywhere with this. And then I saw a girl, her, her handles thought it was girl. And I’m like, how would invest a girl best to grow Brit? And that’s where that kind of started. So it was a little, a little bit trial and error and figuring out what works. But I do suggest for people to have their, their first name or something to do with it because now when people type investor on Instagram might have wanted to come up. 

So I love having my first name, but also the word investor in there. Cause that’s what I’m all about. So yeah. And, 

Jesse (8m 51s): And it’s, I mean it is, is I think it’s topical and it’s important. You mentioned where the credibility pieces, because you just see so many people in our industry online, you know, you don’t know what I can only imagine at this time, like I started investing, you know, the same, roughly the same age you were, I was 19 turning 20. And at that time you had magazines, you had like a few magazines, BiggerPockets was in its infancy and now there’s so much information and you don’t really know, you know, what to, what to really go to what’s credible. 

So having that credibility building, whether it’s an ebook or like, like you said, you started a page. I could totally see where you’re coming from the blog. I feel like it’s a lot of effort with potential, you know, not exactly a lot of, if there’s not output from the blog, you’d be like, why am I doing all this? This is a lot of 

Brittany (9m 40s): Work. Totally, exactly. And what’s good about Instagram is the stories too, where people can really get to know you as an individual and see that behind the scenes. So when I was renovating properties, it’s not fun all the time, you know? So I try to show all the ups and downs and, and get in bed to, to invest in. Cause that’s relatable. Cause it’s the truth about it. It’s not all fun all the time and highlight reels. It’s actually, no, this is real life and this is hard. So I think, I think that’s, that’s a good way to go about it, to just be your authentic self and not trying to be any, you know, like show, tell people what your goals are, what you’re trying to do and, and just grow your network that way. 

And people can really start to relate to you. 

Jesse (10m 22s): Yeah. And I think there is something about Karabakh Backman, who was, who was on the, the show last year. She does, you know, has DIY projects as well. I think there’s something about just humans in general, when you see the before and afters, regardless of it’s, you know, weight loss, or if it’s a real estate fix and flips, there’s something about that that were like, it’s satisfying seeing that. So I think like you hit a perfect niche where, you know, you have a education, you have investments that you’re doing, but you’re also seeing a product and what it potentially could be 

Brittany (10m 52s): Totally. And it’s, it’s that transformation like any good movie or story or anything it’s like, the character is not the same at the beginning as they are end, but you know, it’s that real life situation and people are kind of looking for, for some somebody to connect to. And that’s why we have our little drugs as real estate investors, I think, cause it’s, it’s difficult to stay motivated all the time when things aren’t going always the right way or, or you want to be able to celebrate your wins with people. And yeah, I think it’s a really good way to do it. 

Jesse (11m 20s): Yeah. I have a mentor of mine that he’s always saying, you know, tell, you know, teach in stories and explain in stories and when you really grasp it, you’re like, wow, it does, you know, when you hear somebody talking like that, you initially, you know, you’re engaged because like you said, it’s a journey. I don’t know if it’s, I think it’s just a human tendency. So you start down this path of doing DIY projects, maybe for listeners, you could pull one of the, maybe not the first one, but a one in the past that you did, that was kind of your first foray into that world. 

And what were some of the challenges during that time? 

Brittany (11m 59s): Yeah. So lots of the renovation stuff was, and I would go out. So even during the power engineering job, I’d drive four hours out to a property and then stay there over the weekend, renovate it and then drive back home like four hours back. It was a lot, but it was, it was something that I just, you know, is that sacrifice you kind of honestly have to make if you’re a new investor and you’re just trying to get in the game. It’s like, okay, do I have to, because a lot of people also get stuck in an expensive market. So I was looking outside of the market just to see, okay, what makes sense? 

This, this house cost $40,000 and it’s going to bring in 1200 a month. So, you know, that’s go for that. And it was kind of just always looking, not knowing exactly all the answers, but, but finding the ones where the numbers did make sense and then being able to, so it was kind of going and Burr was the main strategy at that time. I’ve moved more into the commercial real estate stuff now, but, but with the single families, it was all bird projects. So it was get in there, renovate them, build up that equity and then rent it out, pull out that money and then move it on into the next one. 

But a lot of these projects too, it was just, you know, how can I make this work? There’s always rope, roadblocks and things problems happening. So it’s okay. It can get a mortgage for this $40,000 property. But I asked a whole ton of banks and they said, we can’t give you a mortgage for this. These are the reasons. But what I can do is give you a personal line of credit for $75,000. I think it was. So it was a $75,000 credit they gave me. And so I was able to purchase the property and get a renovation costs and then refinance after that. So it was, it was good. 

Like there’s just, I feel there’s always a way there’s always a partner bank or someone else to talk to, to get the project moving forward. Yeah. 

Jesse (13m 39s): I think if, you know, even one of the deals we’re doing right now, we’re raising capital for, and you know, even when it’s on the goal line, you’ve closed or sorry, your all the deal sort of the APS, the purchase and sale agreements finish, you have your closing date everything’s should be smooth sailing. And then there’s always something, oh, we have an encumbrance, oh, there’s a lien. Oh, we just did title search. And I think it’s as investors, you do that once, twice 20 times, you start just, you know, that one thing you can expect is that there’s going to be something that comes up that you’re going to have to handle. 

And if you can’t do that, you’re probably in the wrong industry 

Brittany (14m 12s): And it just gets easier over time. It’s like those problems. Cause I think back to those days renovating the property and it was so frustrating, you know, learning how to do these renovations and all this stuff. And then all this pro tenant ruin this flooring or something like that. And then it’s so, so overwhelming. And, and then, and then you look back at where we’re at now and those problems are small, but you can’t see it when you’re in it. So I think that’s just important for people to know if you’re just starting out or you know it, and it’s just new, new levels, new problems all the time. 

Professional problem solving problems. Yeah, exactly. 

Jesse (14m 49s): I was having this like joke or debate with a few of my buddies and we were talking about just, you know, what you would leave for your kids. And something came up, would you leave a property to your kid? And, and we were talking about smaller prop properties if you had a kid. And I was like, somebody brought up the idea of it being a gift. And I was like, honestly, you give a rental property with a bunch of headaches as a lesson to your kid. Not as a gift, 

Brittany (15m 14s): That’s a good plan because 

Jesse (15m 15s): I was, I mean, it was the same for me at, at, you know, 19 20, 21, maybe a couple of years older where you’re learning how to do things that you would otherwise not have had to do. What’s a S what’s a C trap. Why am I doing, why am I mudding? Like everything to do with actually fix, fixing up? Because the reality is if you buy single family houses in the beginning, you are doing things that you can outsource as much as you want at that point. You’re, you’re going to actively do things in the property. And it sounds like for you, you took it to the next level and you’re actually doing the brewer strategy and like going in with the idea, I’m going to add value to this and refinance. 

Brittany (15m 52s): Exactly. Yeah. So how has, 

Jesse (15m 55s): How has your portfolio, or what you’re doing now, you mentioned commercial real estate. How has that evolved over the years, Brittany? 

Brittany (16m 3s): Yeah. So got up to, you know, a few single family duplexes and then the last purchase was apartment building. So 27 doors now, and those are all in Canada. So those it’s been great. It took a while to get the process of handing everything over to property management and getting bookkeepers. But I read a book called who not how, I don’t know if you’ve heard of that one. Dan Sullivan. I think Dan Sullivan’s author Benjamin Hardy. Yeah. So I love that book and that really changed my mindset along with some mindset coaching and stuff like that. 

So it’s just kind of getting myself, cause I kind of did get stuck in this DIA DIY mentality. And I was like, I just love the work. I’m going to do this every day. But I was kind of just in my comfort zone, but I, I always had this in the back of my head. Like, no, I want to expand. I want to do more. I want to scale, but it’s really hard to scale when you’re and I was tying myself to the property cause I was building myself into this job of having to do renovations to the property completely. So I was living there. I was like sleeping on the floor and all the drywall dust. 

And I was like, okay, this isn’t working for me anymore. It was awesome at the time I was so glad I got started in that and learned so many lessons, but it got to a point where it just, you know, I just had to make a mindset shift and I was reading who, how do mindset coaching and all this. And, and it wasn’t what I wanted. I was telling myself that, but it wasn’t actually truly what I wanted because the main goal in real estate was that time and location freedom. And I wasn’t, I wasn’t doing that for myself because I was just doing renovations all the time, every day. So I still like to do the DIY stuff and I love that kind of work. 

I love being hands-on, but that’s more of a hobby now for me, rather than just my main real estate investing strategy. So, but it was really curved. Did Joe or good too, I guess. I don’t know. It’s kind of funny. It’s like when you started real estate and then it was really difficult and then you get to a plateau like, oh, everything’s easy. And then it’s like, I don’t want to scale. And then you could try to get to the next level. So that’s kind of what I’ve been transitioning into, but it’s been, it’s been awesome. So yeah, 

Jesse (18m 9s): I, I think it’s for people that have been successful too, it’s like everybody, or nobody’s immune to feeling comfortable. And even though your comfort in flipping houses, might’ve been way out of somebody else’s comfort zone because they hadn’t gotten to that level or maybe didn’t want to, you know, that wasn’t something they wanted to do, but then you get to that level and you continue to do it for a while. And then yeah, like you said, you get comfortable and you have mentors or coaches to constantly push you and be like, well, what do you really want to do? And I, I totally hear your point of, you know, we talk about freedom and not having a job. 

And then all of a sudden we’re busy. We’re the busiest person we know. 

Brittany (18m 45s): I think, I always think it’ll always be that way because you get to this point for a reason because you are that way and you’re like, let’s go, that’s progressing, moving forward and, and the trial, and then you just start to, you know, want to do more bigger projects, but you want to be able to have the choice of it. I think that’s where it, 

Jesse (19m 4s): Yeah, it was just reminds me of the matrix, the illusion of choice. Yeah. So the 27 doors in the great white north tell, tell us about 

Brittany (19m 13s): Them. Yeah. So mostly in Saskatoon is kind of the main hub. So I have a few duplexes out there and then kind of just went all surrounding areas where the cashflow made sense because it was just in, and I always tell people this because people do get really stuck, especially Canadians, I think, cause they’re such expensive markets like Toronto or Vancouver. And then you really have to kind of look into those other areas like Saskatchewan, cause there’s lots of industry there there’s, you know, tons of renters and not a ton of nice places to, to rent. 

So that was kinda my thought process behind that. It’s like, okay, create this really nice rental in this smaller area, but it’s, there’s never a problem with vacancy and there’s no appreciation, so that’s the trade, right? Like there’s a little bit through the forced appreciation with the renovations and then a little bit of, you know, passive appreciation as well with the market, but it’s not a ton. So it’s a different strategy between Vancouver and in Toronto and those types of areas, but then still it’s solid cashflow. Yeah. 

 

Yeah. So I think that was kind of the thing. It was just kind of looking at these smaller centers, seeing where there is heavy industry, but a lot of the workers, like for example, the apartment building, that’s 14 units, there’s a ton of transient workers. So they’re there for maybe a year or two and they don’t want to buy a house because why would they buy a house if they’re not going to be there forever? So they’re kind of just not committed to buying a house, but they will pay top dollar for rent, like same as city prices, but you know, could buy the apartment building cost 450,000. So for units, and then, you know, now some of the bachelor units are getting, I think it’s 850 rent for a bachelor unit. 

 

So yeah. But yeah, and then it takes care of all of it too. So now I’m just like, yeah, free. 

 

Jesse (21m 4s): It’s so true though. Like the 450,000 and like, you know, you, you move into some markets and that’s how much it is a unit. Like you go certain, especially smaller multi-family in Toronto. It’s I tell people that come on the show that if they’re from New York, they can kind of understand if they’re from San Francisco, any of those really extremely hot markets, Vancouver and Toronto would be in that same category. I’m curious. So last time I was at west, it was no boarding out in Whistler, so I didn’t get a chance to stop and, and in Saskatoon, but I’m curious out, out in Western Canada, are we starting to see more manufactured housing that, you know, everybody in the states that comes on my show has either something to say about manufactured housing or is that investing in it? 

 

Brittany (21m 49s): Hmm, no, I don’t really do much of that now, especially right now I’m kind of focused actually more on the U S market. So I haven’t really been that involved in actually dosing actually. 

 

Jesse (22m 1s): Yeah. Right on. So for yourself, I mean, just on that point, looking at investing in the states, what are, what are some of the opportunities you’re looking at right now and what do you think, you know, we have in store in the next year or two, just in, in that regard and opportunities? 

 

Brittany (22m 17s): Yeah. Well I’m really, really excited right now because so through, you know, actually through social media and online and everything I got on bigger pockets podcast. And so that was a few years ago now, but I created some really awesome connections and, and really great friends. Some of my best friends, I met through bigger pockets and going to a Maui mastermind that Brandon Turner hosted. So he just kind of picked 20 people out of his fall or people that he was following on Instagram or whatever created this little mastermind group. And that’s where I made some really amazing friends. 

 

And, you know, I have, I started to focus this year, just on my strengths. What am I really good at? And you know, my reach through Instagram and everything like that and partnering with these expert operators because ADA Osborne, which is where I’m at right now, I’m in Boise, Idaho working with AGA Osborne. And he’s an incredible operator and industry leader in self storage. So they have, you know, over a million and a half square foot of storage right now and they’re just rapidly expanding their portfolio. So I’m kind of on the acquisition side of it. 

 

It’s, you know, reaching out to brokers and my Instagram audience and everything, looking for self storage facilities to either do value, add projects with or development site as well. We’re working on a big development hero in Boise. So that’s going to be started right away. And I’m just really excited about it. So being on a team, cause I was always, you know, focused on is working on like, oh, like kind of doing, I was like DIY everything, all, all of it. But now what I realized is what I enjoy doing. 

 

What I like doing is the collaboration and working with these incredible operators, they already have all their systems. They already have, you know, amazing network, like everything all sorted out. So what, what I’m doing is bringing investors into these projects and helping with acquisition side and everything too. So right now it’s been like self storage, everything. So there’s a ton of opportunity in that right now. What’s cool too, about storage is that the fragmented market? So 72% of the self storage facilities are owned by mom and pops. 

 

So it’s funny. Cause I was, I actually had a self storage facility, I think a year ago under contracting in Canada. But what I was doing is just kind of going around cold, calling a bunch of owners and just saying, you know, it’s funny cause you call the number, doesn’t it don’t pick up. Like they don’t pick up. And then once in a while they’ll pick up like, hello, I’m like, oh hi, I’m looking to rent a storage unit. Oh yeah, let me just call you back. Sure. So that’s not managed correctly. And then, you know, you make an offer and go from there. 

 

So that’s, that’s, what’s pretty cool about self storage and you know, a recession recession resistant asset class as well because even through COVID, it’s just performing super strong and there’s a lot of people moving and there’s a lot of people downsizing at this time. So storage is very needed during this time, but it’s been one of the, you know, growing asset classes the last 20 years. And there’s a lot of, lot of opportunity with that fragmented market if you’re able to go in and really expertly turnaround the operations. 

 

So it’s immediate value add with the existing facilities with through operations. 

 

Jesse (25m 33s): Yeah. We’re seeing a lot of, a lot of self storage. Sorry, sorry to interrupt 

 

Brittany (25m 37s): There. Continue. 

 

Jesse (25m 39s): Yeah, no, I was just going to say we’re, we’ve been seeing, I think it’s everywhere. I think a self storage is one of those areas that there’s just a lot of attention and I think you’re absolutely right. It’s there’s just a large percentage of mismanagement, I think where there’s operations, like you said that you can immediately add value. I’m pretty sure Aja is also speaking actually quick shout out to your speaking at BP con 2021 new Orleans. It is happening. I’m speaking as well. And I’m pretty sure AIG is as well. I think he’s on some sort of panel maybe talking about self storage. 

 

So yeah. So there’s that there? So as a, as a, I guess in this case, somebody that’s investing from outside, cause you’re on a visa. Is, is that any different in terms of how you invest? Do you ha are you creating a different structure for the investments when you go in with operating partners? 

 

Brittany (26m 34s): Yeah. So right now I’m on a working visa. So for me it’s a little bit different and I still have a company in Canada, but I’m actually employed now by Cedar Creek wealth, which is a data company. So I’m employed through them and I’m able to make my positive investments. It gets a little bit complicated. Like the syndication side is easy. Cause you can invest quite easily as a Canadian. You just have to set up your holding company and then it kind of goes through that way. And then you save on taxes, but I’m not trying to give tax advice. So that’s the disclaimer, but that’s how people, so I have quite a few Canadians now as I was presenting these opportunities to my audience, like quite a few of them are Canadian. 

 

So it’s just, it’s, it’s awesome because there is so much margin with returns, especially in storage. So I mean there’s a lot of opportunity for investors as well and Canadians as well. Cause I mean, yeah, I guess people do, I’m like everybody can join 

 

Jesse (27m 36s): These, the self storage. Cause we’ve, I mean, we talked a lot on the show about, you know, different syndications, a limited partner, general partner type structures, the self storage are they, are they structuring them pretty much similar to other real estate investments where you, you have an operator, you have multiple limited partners or are you doing something different? 

 

Brittany (27m 57s): Yeah. That’s pretty much how it’s been so limited partnership. And then it’s, it depends on the deal. So we do both right now, the development deal was structured a little bit differently, but then from the existing facilities, but yeah, it’s a 60 40 split. And then we have a waterfall structure after the investors for this specific deal, it was after 120% return. And so the investors get their returns and then it splits the waterfall structure happens. 

 

So it’s turns from a 60%, the LPs to 40% of LPs. And then yeah, 

 

Jesse (28m 34s): I have a, basically a preferred return built in and with each, each IRR or each percentage return, you have a different split for, for 

 

Brittany (28m 43s): Exactly. And we’re getting into it cause so AAJ has not done a ton of syndications that he just recently started to cause they’re rapidly growing their portfolio and have so much on the go. And there’s so much opportunity right now. So that’s when it pretty much just started with the syndication side right now. And that’s where my role has kind of been as well. So it’s just kind of a whole new thing where we’re, we’re getting all, we’re trying to get all of these investors in because it’s so fun to be, you know, providing these opportunities to people. 

 

So I’ve, I’ve had a lot of fun with that as well because you know, starting my Instagram page too, I never thought I’d be in a position where I could like provide these opportunities to people and it’s like, wow, this is crazy. You’re like I have the funnel. I know do these massive deals together. So yeah. Yeah. Definitely fun. Yeah, 

 

Jesse (29m 35s): No, that’s really cool. And I think the, just the private placement or the exempt market has been blowing up, it’s always, I mean, it’s been a big part of the market. I don’t think a lot of people that aren’t in our industry or say the movie industry or oil and gas realize how so much money is raised through just private placements and, and that’s the market that oftentimes that we’re dealing with. But I think it’s something that is really blowing up. I know for, you know, Canadians the fact that we’re hearing about syndications and more and more people doing them up here when we are pretty conservative, when it comes to investing, I think is just kind of an illustration of that. 

 

So in terms of, you said you’re in Boise right now in terms of the geography that you’re investing in right now, is it focused on one specific market or are there a number of markets that you’re looking at? 

 

Brittany (30m 24s): Oh, looking all over, especially with storage, there’s opportunity all over the country. So looking for a population in a that’s growing 30,000 people plus, so kind of looking at that. So there’s lots of options there, but yeah, we’re kind of all over focused in Texas, Oklahoma city, Kansas city. Boise’s an awesome market. That’s where new development project is and it’s just growing like crazy, so super hot markets and, you know, looking for that. 

 

And then we, we have a lot of different ways. So I’m, I’m getting actually a lot of people sending me deals through Instagram, we’ve been in and we’re looking for a storage facilities, 60,000 square feet plus, and you know, so and value add. So if there’s any problems that we can solve, we’re pretty good at solving those problems. And then we’re able to turn them around pretty quickly. So that’s kind of what we’re looking, we’re open to really any market, but as long as we, you know, we go in and do our deep dive of course, but it’s, that’s kind of the general criteria. 

 

Jesse (31m 26s): Nice. So I can only imagine your inbox is just probably hammered on, on Instagram. 

 

Brittany (31m 31s): I know all the VA’s and that’s like the other part of it. Cause I need to, you know, I’m in the phase of just hiring people out to help with all the organization of everything as well. So that’s been really fun cause I’m used to doing everything on my own, but like this past year it’s been definitely awesome to have this team around me and people on my side helping me out and to your point, who not, how not, how exactly changed everything 

 

Jesse (31m 58s): Point there, the team, what is the, what does the team look like right now in terms of the investments that you’re doing? So, you know, AIJ, you know, in storage, for example, you know, there’s the analytical, there’s the operator, there’s the market like where do you fall in that? And you know, who are your indispensable team members? You don’t have to say their names, but just kind of the roles they do. 

 

Brittany (32m 19s): Yeah. So I mean the ADA’s team is 35 plus people. So there’s definitely a lot, but then there’s the construction manager, acquisitions manager and myself, I’m kind of helping with the acquisitions and then syndication side. So that’s kind of been my role and just kind of, you know, getting out cause we do a lot of on the education side as well. So there’s an inner circle and you know, there’s a lot of ways and that’s the other part of it too, because once we get so many deals coming into us, maybe they don’t exactly meet our criteria, but we’re able to completely analyze them and help other investors out. 

 

If there’s people who want to buy these, maybe a smaller facility, that’s less than 60,000 square feet. So there’s a lot of opportunity in that as well, sharing these extra deals kind of with it, that investors. So, but yeah, there’s, there’s a big team. They’re really incredible with their operations and they have everything super streamlined. So taking Wilbur can flip them round super quick and get things on the operation side happening really fast. Very 

 

Jesse (33m 19s): Cool. So we’re, we’re almost coming up to the time here, but before we, before we kind of get into four questions, we asked every guest on the show. What I’d like to do is talk a little bit about the current environment that we’ve been living through, you know, from call it the last year and a half. Just what your experience has been like over this time, you know, as there been some, you know, wins or losses and what you think the opportunities over the next few years are going to be, or is there anything you’re doing differently as a result of what we’ve experienced? 

Brittany (33m 54s): Yeah, well I think for me, it all my rentals have, I had a few, you know, tenants to work with who lost their jobs here at COVID. And so helping them out, you know, get things kind of a little bit more on track with them. But other than that, everything has been pretty stable and it’s been a little bit, you know, it has been a way different year for me, but not really due to COVID. It was more due to my mindset expansion and trying to get into the commercial real estate space and working with expert operators who, you know, they, they know every single little detail and I’m like, okay, I can team up with the people who already analyzing every single little detail about everything there is to know, and if I can team up and help them with, you know, what I’m an expert at, that’s where I kind of want to be. 

So it’s been really fun connecting with these other operators in the spaces, but we’re just, there is a lot of opportunity right now. There’s a lot of changes happening with, in the states and everything with the 10 31 and there’s all the talk of everything, but it’s just kind of adjusting and pivoting and, and not being kind of intimidated, but just kind of analyzing and knowing, you know, we can mitigate a lot of risk in that way just with our experience, but yeah, yeah, for 

Jesse (35m 10s): Sure. I think it’s just a matter of kind of being prepared. There’s really nothing we can do if, whether it comes to capital gains 10 31 exchange, which as, you know, we, we don’t have here, so we’re just roll our eyes. Okay. You’re going to lose it potentially. Very cool. So Britney, we ask guests on the show, we’ve touched on some of them, but pretty much four questions, pretty, pretty softball questions, everybody at the end of the show. So if you’re game for that, I throw them at you. 

All right. One thing that you know now in your career that you wish you knew when you got started at what was a young age of 18. 

Brittany (35m 50s): So I think starting to build that credibility for yourself, you know, getting out there, building your network. I think that was a huge for me and I didn’t see it at the time, but now I can definitely see how beneficial that is. So getting out there and starting building your network, you know, there’s so many places you could go online and start posting in groups and everything. Even if you’re a new investor, just get started now because it’s intimidating posting. If you feel like you don’t know what you’re talking about yet, it’s really hard to post. Cause you’re like, feel awkward. Like, oh, I’m not an expert yet, but just start as soon as you can because people kind of connect to you no matter what stage you’re at. 

Jesse (36m 27s): So you touched on it a little bit earlier. I think everybody’s on the same page when it comes to mentorship, especially in our space, but your views on mentorship and maybe in the context of, you know, younger people getting in the industry, you know, what would you say to them? 

Brittany (36m 42s): You have to prove yourself because I think there’s a lot of people that just take, take, take, they want one while all these things, but you really have to get out there and provide. So for me, you know, when I was starting, my, I didn’t even have a thousand followers, I don’t think. And I was posting on Instagram listening to bigger pop cause I was talking to my mentors and saying, oh, listening to BiggerPockets. This is what I learned on this episode, tag run and take Josh or David or whoever was hosting at the time and, and, and try to provide value for them by just, you know, shutting up their work and being like, okay, you guys should buy their books. 

You guys should do this to my little audience that I had at the time. But then that was kind of gaining this attention. And I was just working really hard every single day and mentors and people, they can see that they can see the people who are really trying willing to take advice and actually implement it and put it into action. But mentors, mentorship for me has been everything. And I have a lot of really awesome people on my side, but it’s through that hard work that they’re, they’re going to want to help and continue to. Yeah, 

 

Jesse (37m 39s): For sure. I mean, especially with the social media now, if you’re a champion of something that you find interested at, first of all, I think it’s shines through, you know, if you’re excited about it, but also just with social media, you’re able to connect directly with that person. You know, it’s something where, you know, 10 years ago, if you really liked a book, you could call the author, but now you kind of, you have everything at your fingertips if you want to take advantage of it. Totally. So in terms of, so question number three for you here, you already mentioned who not how, but is there any other resource or book that you, you know, you’re using that you’d recommend to any of the listeners? 

Brittany (38m 16s): Yeah. Huna has a really good one, crushing it in apartments and commercial real estate by Brian Murray. He was another mentor of mine and a really awesome friend. He’s just the best. So that’s been one of my favorite books and that really started to change my mindset from single family to commercial real estate. And I do suggest, you know, getting cut cause it takes a long time. Right. So I read that book two years before I bought my first commercial building, but it was always in the back of my head, like, okay, you know what we’re going to get started, but just like getting in that mindset sooner rather than later. 

 

Right 

 

Jesse (38m 48s): On. All right. My favorite question, first car, make and model. What are you strolling around Saskatchewan with? 

Brittany (38m 58s): Well, I had a Ford, 1995 work van. So that was that that’s a good one because that’s like a vehicle plus a house. So, and having just sleep in that for years. So yeah, be creepy if I was driving it, but I guess it’s a normal 

 

Jesse (39m 15s): Vehicle and Northern Canada. Awesome for listeners, Brittany, obviously. I mean, you’re a Google search away. Like I always say on the show, but if people want to connect with you or see what you’re doing, see what you’re up to in terms of investment, anything really, what’s the, what’s the best place that they can go to? W we’ll put a link in the show notes. 

 

Brittany (39m 40s): So investor, girl grits, my Instagram page, that’s where I post most of my stuff. And then my website, Brittany arneson.com. 

 

Jesse (39m 48s): My guest today has been Brittany Arneson Brittany. Thanks for being part of working capital. Thanks so much for having me. Thank you so much for listening to working capital the real estate podcast. I’m your host, Jesse for galley. If you liked the episode, head on to iTunes and leave us a five-star review and share on social media, it really helps us out. If you have any questions, feel free to reach out to me on Instagram, Jesse F R a G a L E, have a good one. 

Take care.