MVP Real Estate Podcast

From Silicon Valley Executive to Real Estate Powerhouse

• Marcus Perleberg • Season 4 • Episode 8

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Ed Matthews, the principal at Clark Street Capital and the host of the Real Estate Underground podcast, shares his incredible transformation from a Silicon Valley marketing executive to a real estate investment powerhouse. Discover how Ed's desire to achieve a better work-life balance for his family led him to build a formidable real estate portfolio that outstripped his corporate earnings. Tune in to hear about his calculated risks, strategic shifts in property management, and the personal sacrifices he made along the way.

Experience the rollercoaster journey of overcoming fear in real estate investing with Ed's heartfelt stories, including his teenage years working for home builders and his pivotal first investment during the 2008 economic downturn. Ed's tale of turning a $99,000 four-family building into a $410,000 success is a testament to the importance of perseverance and pushing past anxiety. Listen as he reveals the lessons learned from nearly collapsing a 10,000-square-foot building due to a contractor's blunder and salvaging a fire-damaged property, demonstrating the resilience essential for real estate success.

Finally, Ed discusses his shift from managing smaller multifamily properties to focusing on larger investments, illustrating the efficiencies and complexities of this transition. Gain insights into the nuances of property management, capital raising, and the strategic maneuvers required to thrive in the multifamily market. This episode is a treasure trove of practical advice and inspiring stories, ideal for anyone keen on understanding the intricacies of real estate investment and achieving a balanced, fulfilling life.

Website:
https://www.clarkst.com

Facebook:
https://www.facebook.com/ClarkStCapital

LinkedIn:
https://www.linkedin.com/company/clark-st-capital

Chapter Timestamps

(00:04) - Real Estate Transition From Silicon Valley

(10:57) - Overcoming Fear in Real Estate Investing

(20:41) - Real Estate Investor's Curveball Stories

(36:04) - Transitioning to Multifamily Real Estate

(41:59) - Real Estate Investment Success Stories

(50:11) - Real Estate Investment Strategies and Education


Highlight Timestamps

(04:41 - 05:56) Resigning Before Company Goes Public (75 Seconds)

(09:26 - 10:44) Work-Life Balance in Real Estate (78 Seconds)

(16:33 - 18:09) Real Estate Responsibility and Success (96 Seconds)

(20:41 - 21:44) Real Estate Investment Strategy Expansion (64 Seconds)

(29:57 - 30:32) Building Demolished Due to Subcontractor Mistake (35 Seconds)

(36:04 - 37:00) Property Portfolio Expansion Strategy (57 Seconds)

(40:44 - 41:57) Navigating Challenges of 1031 Exchanges (73 Seconds)

(43:57 - 45:24) Property Purchase With Added Land (87 Seconds)

(49:24 - 50:10) Real Estate Investment Success Story (46 Seconds)

(52:10 - 54:06) Sharing Knowledge in Real Estate Industry (115 Seconds)


Speaker 1:

Welcome back to MVP Real Estate Podcast, season 4, episode 8, with Ed Matthews out of Connecticut. He's got. We have not had a storyline like him. He did come from a successful career within Silicon Valley selling. He was on the marketing sales side of a few different companies that he touches on during the show. But he did something super smart and I wish that more people took the I'm going to call it a sacrifice, because you do have to sacrifice some of your income to set yourself up later, and he would take his profits, his bonuses, set them aside and then built real estate up to where it surpassed his salary to then. Now he can run that and be home more because his job obviously made him travel around the world. So very unique story. So let's bring on Ed. All right, ed, thanks for coming on the show giving us some time. I appreciate it.

Speaker 2:

Truly my pleasure. Good to see it.

Speaker 1:

Yeah, you too. Well, I start the show the same way every time, giving the audience a little background of where you came from.

Speaker 2:

Who am I and why am I here?

Speaker 1:

Yes, who are you and why are you here? Perfect way to put it All right.

Speaker 2:

So I'm Ed Matthews. I'm the principal at Clark Street Capital. I also am the host of the Real Estate Underground podcast. I spent about 24, almost 25 years working for Silicon Valley companies, flying all over the world country and sometimes all over the world slinging software and services, and on the side, I built a small to medium-sized portfolio of small multifamilies over the course of years. I started in 2011. And over the course of about seven years, I built up a portfolio large enough to be able to surpass what I was making in corporate America, and that happened to coincide with a couple of life events. One was that I had teenage daughters who were preteen daughters, who were about to become teenagers, and I wanted to be a significant influence in their lives, and it's really hard to do that from a courtyard Marriott somewhere else in the world, and so that's part of it. Um and uh, I also realized that I didn't want to travel as much as I was traveling because I was missing too much good stuff at home. You know, between you know, seeing, missing and and not seeing my wife and and, uh, not seeing my daughters who, uh, I like them a lot and they still like me a lot and I wanted to maintain that. So it all kind of coincided in late 2017. And so I resigned from my role at a company called DocuSign and started in earnest February of 2018. And I've been doing it ever since.

Speaker 1:

Wow, that is quite a career there I've. I've got a lot of questions about Silicon Valley, because sure I'm not the tech guy in what goes on in Silicon Valley right now is it's blowing my mind with all the technology and stuff that's coming out of there.

Speaker 2:

It is amazing. I've been detached from it for a while, but I do keep up. I try to keep up. And I'm not a technical programmer. I was a marketing and operations guy myself sales marketing and operations guy but I'm just techie enough.

Speaker 1:

Yeah, and were you with DocuSign that whole 25 years?

Speaker 2:

No, no, no, no. Okay, with probably five or six different companies over that course of time.

Speaker 1:

Okay, Because DocuSign. That's a big name in the digital signature world.

Speaker 2:

It is, yeah, it was and is the leader right, yeah, and so I had the opportunity to work for Keith Kroc, who was the chairman and and, at that point, ceo, and you know, I mean he's one of the of the of the pantheon of entrepreneurs in in in Silicon Valley. You know, he's certainly on that on that list of people, the who's, who's. And you know, when I had the opportunity to go work for him, I jumped at it and, uh, it was a, it was an amazing ride. Um, I, I loved, you know, I I loved the job. It wasn't a, it wasn't a, the job wasn't the problem, it was the fact that I wasn't home was the issue, and I was standing. So, keith Kroc, I affectionately referred, when he goes into his kind of we're at a year-end summation kind of conference of hey, good job, we had a great year, and I refer to it as Keith's laser light show. I mean, he oozes charisma, right, and so he's up on stage and he's doing his speech, his speech and and, uh, everybody was excited and he was right. You know, where we were in the market was spot on and where we were going was exactly where we needed to go. And I'm standing there like, yup, he's absolutely right, but I just can't do this anymore. And so, um yeah, I actually resigned four months before they went public, which everybody and their brother were like, are you out of your ever loving mind? And I said, yes, I am, but I'm still doing it and I'm I'm out of here. So, and and it was, it's been a great ride ever since.

Speaker 1:

So yeah, I mean it's a nervous step, but it sounds like you prepare pretty well.

Speaker 2:

Yeah, it was terrifying, but, but you know, we, we muddled through and battled hard and, and you know, got the business operating to where it could run without me, which is good. And and now we're, you know, in a pretty substantial transition period where we're selling off a lot of those smaller multifamilies and we've launched a debt fund and we're now aggressively looking for much larger buildings. So typically my buildings were in the our smallest one was about four units and our largest one was, I think, 15 units, and so we had a whole bunch of buildings and I was herding a whole bunch of cats keeping those buildings cooking, and I realized that if I could consolidate, if I could sell off those assets and consolidate them into one or two much larger 75, 100, 150 unit buildings, that operationally we can become a lot more efficient. So that's the process we're going through right now.

Speaker 1:

Awesome and I want to get to that stuff. But I feel like for the listeners, we should try to go through the beginning and then talk about your transition, or I'll call it an exit. But it's not really an exit, it's more of a transition, like you're saying. Yeah, so I would go back to all right 25 years you're working at Silicon Valley.

Speaker 3:

Yeah.

Speaker 1:

And you said you were buying multifamilies through that.

Speaker 2:

Started in 2011,. Right.

Speaker 1:

Okay, and those were some of your smaller ones that you still have today, those four to 15 units.

Speaker 2:

I have some of them. Most of them I've sold.

Speaker 1:

Yeah, okay, awesome. And this is just. This is a curiosity question how many properties or how many doors did you have when you ended your career?

Speaker 2:

with. I'll call it Silicon Valley. Let's see, I probably had about 95 doors when I left.

Speaker 1:

Okay.

Speaker 2:

We grew that to just short of 200. And that was across like 22, 23 different buildings. So it was. It was a lot to manage. That's awesome yeah.

Speaker 1:

That's super, super cool to have your career going and you set yourself up super well to when you did want to say I'm done, I want to be at home, I want to be with the family, be with the kids. You had something to fall back on where your your income didn't go from zero or from what you're making to zero Right. So very, very smart idea. That was good foresight. Did you know that's the progression you wanted to get to?

Speaker 2:

or did it just like strike you? It just kind of congealed. I didn't have a grand plan. I had always intended on working in technology until I was done and whatever that meant, and the real estate thing was fun. I realized that in order to and it was, you know, I realized that in order to. You know, I made a pretty good income from Silicon Valley and those jobs and that paid the bills and allowed us to go on nice vacations and, you know, save money and all that. But I also realized that, you know, just saving the 10, 12, 15 percent or the bonuses that we were getting or the commissions I was getting, wasn't going to be enough to build a retirement for me and my wife. And so that's where the real estate came in is to start to build, you know, actual cashflow, wealth, and and so that's why, you know, I started to build it. It just so happened that I reached a point where I didn't want to, I didn't want to manage a career anymore. You know I, I had run teams, I had run companies, I had, you know I had dialed it back to. You know, just carry a bag and and and run. You know it's much smaller teams and you know it. Just I I couldn't find a place where I could get the life balance I was looking for because you know I live here on the East coast, I live in Connecticut, my, my clients and customers were, you know, frankly all over the world. So if somebody at you know ABC company needs to see me, I get on a plane Sunday night or Monday morning and I go see him Right, and then I'm gone until Friday and then I get back and try and reintroduce myself to my kids and my and my wife and you know, it, it, it, it becomes tedious.

Speaker 1:

So yeah, it gets very, very difficult, so you stumbled on a very good, not planned plan.

Speaker 2:

I, yeah, I would love to say I had this strategic grand plan, but I really didn't.

Speaker 1:

No, that's all right, I mean it worked. So, as you're in Silicon Valley, you're making your money, you're like all right, did you find a multifamily you wanted or did you get presented an option? What was your first dip in your toe in real estate moment? Your first dip in your toe in real estate moment?

Speaker 2:

Oh, it's a funny story actually.

Speaker 1:

So in 2008, a very good friend of mine handed me Robert Kiyosaki's book Rich Dad, poor Dad, the Purple Bible, the first book, I read when I got into real estate too.

Speaker 2:

Yep, and it was. I had always been interested in real estate. I, you know, as a teenager I was working for home builders and you know I'm a big guy. So you know I was one of the guys that would pick up heavy things and put them someplace else, you know, on site, and we'd clean up afterwards and every once in a while they let me swing a hammer, and all that. But you know, I fell in love with the whole idea and I had always had this vision of you know, when I get to a point in my career, I was going to build houses. Of you know, when I, when I get to a point in my career, I was going to build houses, um, and then I put it to the side because, you know, life happens and family and obligations and all that. Um, so my friend hands me a rich dad, poor dad, and I consumed it in like a day. I mean, it was just I couldn't. I was obsessed with the book and I've probably read it a dozen times since then. Um, I pretty much read it every year and the whole idea of building wealth through real estate really resonated with me, and so I thought, okay, well, I'm going to go do this, and 08, obviously, lehman Brothers declares bankruptcy and the economic world hangs in the balance for that brief 18 to 24 month period of time, and it took me a long time to find the courage to actually pull the trigger on a deal. So in that time we moved from Boston, where we were living, down to Connecticut, where my wife and I are both from, and I met this broker, amy Rio, who was a small startup broker she probably had four or five agents at that point. Right now she's probably one of, if not the biggest brokerages in the state of Connecticut, and so, through her generosity, she probably showed me no less than 20 different buildings, and I always found an excuse not to buy it because I was terrified, right, you know. Oh, I don't want to buy a white one, you know, oh, I don't want a blue building. Oh my God, that one needs a roof. Oh that, you know. Okay, the 25 windows are good, but it has a stained glass window. How do you replace that? I'm not, I don't want to deal with that. And I found all these you know, silly reasons not to buy. And we finally found a four family on Clark Street in East Hartford, connecticut, for$99,000. And we walked through it and I'm already, you know, going through the catalog in my head of here are the 19 reasons why I'm not going to buy this building. And so I'm walking out, back out to the parking lot and she said, well, what do you think? And I started with my usual well, it needs this and it needs that. And she's nodding her head and she takes a pen out and she clicks it, and she takes a piece of paper and puts it on the hood of my car. Now, I'm like 6'3", 6'4". I'm not a small human being, right? Amy Rio, on her best day, is like 5'1". She's tiny, right, and so I'm, like you know, easily a foot plus taller than this person. And so she, you know, very calmly puts the piece of paper on the, on the hood of my car and she goes look, I've shown you 20 something buildings, and every single one of them was a good deal. And if you don't sign this contract, a, I'm going to buy this because it's a great deal, and B, I'm never talking to you again. She clicks the pen, hands it to me sign the contract, right, and? And she didn't say FN and and I was like, oh yes, ma'am, took the pen, signed, signed the contract for 99 K and you know, four weeks or six weeks later I owned the building and it was probably one of the better investments I ever made. I I bought it for 99,000. I put probably about 22,000 into it in terms of making it clean and safe and upgrading you know what needed to be upgraded and and, and you know, bringing it up to a basically a good standard. I did most of the work. You know I did a lot of the work myself on the weekends and you know I actually just sold that building for $410,000, probably about three months ago. So, wherever Amy Rio is, thank you, that was for us.

Speaker 1:

No, that's a very, very good story, cause the first purchase is always the scariest one.

Speaker 2:

Absolutely terrifying.

Speaker 1:

Yep, I remember there's always like moments in your life where you you can remember the anxiety or the stress you were in and like one moment was my first college start I got. I was so nervous, like my calves were like vibrating from the nerves, and the first auction where I bought a house and I was bidding, I had the same like shaky. It's the same thing with my first purchase as we're at the closing, like I can feel everything shaking because of my nerves and like. I don't know what I'm going to run into. You see, the things like, oh, we need to replace the stained glass window, and how do we do that? And the flooring needs repaired, and what are we going to find underneath the walls? And all of those things that I didn't really know I was going to run into are running through my head of like, oh, this is a bad idea, this is a bad idea, but you just need that one person to give you the kick Right and then the waterfall kind of opens up yeah, I mean, I tell people and and I, you know, I mentor people now myself and and they, they say, well, how do you get past the fear?

Speaker 2:

and I say you do it anyway. Right, um, my hand still shakes on every contract and every mortgage I signed because you know, frankly, if you don't, if you don't, if it doesn't shake, you don't understand the magnitude of the responsibility you're taking on, right.

Speaker 1:

Yeah.

Speaker 2:

That's a good point. So it's, it is a. It's a big deal and it's a lot of responsibility and of course, you're nervous you should be but hopefully you've thought it through and you've got a good plan and you've you've reserved some, some capital for contingencies, cause every building, especially the old ones that I buy, every single one of them has a curveball, and so you just weather that storm and you keep going and eventually time is our friend in real estate, right? So as long as you can continue to keep a building cash flow positive and do a good job of managing the property and what I mean by that is taking good care of the folks that live there in the long run you're going to win.

Speaker 1:

Yeah, it's true, um, and you learn that early on, I guess, cause a lot of people, when they they get their first one, gets so nervous and, um, I guess they're caught up in learning about it rather than running it. So where you start, you start getting like the quote unquote salon Lords, where they don't take care of their building Cause they're like, oh, I have one and it's doing its thing, and there's all this deferred maintenance that falls in. So, um, that's a super cool story, by the way. So it takes 20 trips or 20 tours of homes to find one. After you bought that first one, obviously you have your time of rehab and getting that stabilized. How soon after that did you go on to number two?

Speaker 2:

You know, once I realized it wasn't that scary, I immediately started looking for more. But I was out of money. So what we were doing was we would flip a couple of houses and we would take the capital from those and buy another multi. Flip a couple more houses, buy a multi, and I kind of rinsed and repeated that process for the better part of seven years.

Speaker 1:

Yeah, and at that point you're still working in Silicon Valley. Oh yeah, traveling, so that means you need to find boots on the ground. How did? You go about that process to find your, your support team.

Speaker 2:

So some of it was, some of it were people that I knew from, because I'm from Connecticut. So there were people I went to high school with who were now general contractors and plumbers and electricians who I trusted, and so a lot of the guys that I worked with were people I'd known for, you know, 10, 12, 15 years. In other cases, you know, we would, I would use referrals and give that, give that contractor a little tiny project to do and see if they performed. And if they performed, then we gave them a much bigger project and you know it was a. It was a lot of trial and error and and a whole lot of pounding the phones trying to find the right people and a whole lot of pounding the phones trying to find the right people Right. And from from my perspective, you know, one of the things that that we were very specific about was, you know the work, the scope of work right. So we were giving them really solid scopes of work to so they understood exactly what needed to be done. There was no guesswork. If something, you know, if that curve ball that I mentioned earlier did pop up, it was a one-off and you know we would wherever I was in the world, we'd get on a phone and talk about it and make a decision and keep going and. But beyond that, you know, they knew exactly what the project was, so they didn't really need me to manage it and and I had a level of trust in those folks so that I knew that they were, they were doing the right thing. And you know, by the time I got back into town Thursday, Friday, I was on site just to just to kind of walk around and make sure that everything was going the way we had. We had agreed.

Speaker 1:

So yeah, that's good. It's good that you had connections, cause that's always a hard one. There's some people that invest in I'm. I'm assuming you've gone out of Connecticut now. It's kind of like some long starting to?

Speaker 2:

yeah, we're starting to. So I had a. I had a portfolio up in Vermont with a with a friend of mine and we've since sold that. And now the capital that we're raising from sales of the of the Connecticut properties, we're heading to North Carolina to buy much larger properties.

Speaker 1:

Gotcha. And now you start that cycle again of trying to find your boots on the ground in that area. Have you started that process trying to find general contractors and property managers?

Speaker 2:

Just starting that process. Right now, I'm focused on selling the last five buildings that we're going to be selling up here. It's kind of consuming my days right now, but in that we're, we're, you know we're, we're just getting cranked up. I'm probably so I'm. It's interesting I've got a whole lot of things happening at the same time. In that we're raising the. You know, we just started this debt fund. We are selling off these last five properties. I'm, you know, my daughter my youngest daughter is plays softball and she does travel softball. So my wife and I are switching off. You know who gets to take Maggie to wherever? My wife and daughter right now are in Kansas City and I'm scooping her up and we're going to Jersey for two weeks and then they're going to Colorado and then I'm taking her to California, and so it's so that's part of this too.

Speaker 1:

So that's all for softball. Yeah, yeah, wow. So we're going to be watching her on ESPN someday around the country she's. You said she was 12.

Speaker 2:

No, she's 16, 16.

Speaker 1:

Still, that's, that is 16. 16.

Speaker 3:

Still, that is awesome, so good for her.

Speaker 1:

Maybe If I ever see Matthews on the back, I'll know, blonde ponytail, yep, that's her. Perfect Yep.

Speaker 3:

We had a recent guest that is in North Carolina investing in the North Carolina area. We have to go back and look to see if we can connect you two to talk and maybe they can help you with some contractors and stuff in the area.

Speaker 1:

I would love that. Thank you, yeah, he was just on a couple of weeks ago.

Speaker 3:

Yeah, I'll have to check that out. I'll get you that information, many thanks.

Speaker 1:

Yeah, hopefully we can avoid. And I didn't mute myself, did I?

Speaker 3:

No, you're good Okay.

Speaker 1:

So I wanted to go back to the curve ball, because these are always the fun questions. So you bought your first one. You bought a couple more in Connecticut.

Speaker 3:

Yeah.

Speaker 1:

Do you have a story, an appropriate story, of a curve ball that was thrown, where I always see like when people first get into real estate and a curve ball gets thrown, they're like see, this is why I didn't want to do it. They throw their arms up and they sell off the property and like it wasn't for me, right? So what are the moments? Because every real estate investor has a curve ball, if not hundreds of them. Yeah, I mean it's a big one for you that you got through. That turned out to be all right.

Speaker 2:

So, um, in like, like, like you and I just were talking about earlier, you know, invariably there is always something that you find that you're like, oh, that's not really the right way to do it. So our you know, our first pass on a building is clean and safe mechanicals, the electrical, the plumbing, and make sure that they are, you know, up to standard and that you know if there's any issues, that we resolve them immediately. Almost always there's, you know, something's wired wrong, something's plumbed wrong. You know the mechanicals. The HVAC system hasn't been serviced in a while and when we do service it we realize, oh, there's a crack in the boiler and we've got to fix that. So there's that part of it. And but there's also, you know, things like, I mean, I think, our biggest hiccup. I nearly collapsed a 10,000 square foot building. Well, I didn't, but a contractor did, yeah, we. So I'll tell you that story. So we bought a five family in New Britain on Arch Street and, like a week later, the property manager that I had hired called at like 6am and there is never good news at 6am when your PM calls. So we, she said, turn on the news. There's a fire next door to your building, your building's fine. I'm on site and you know it doesn't appear to be spreading, so but I just wanted to let you know that it's the building next door and so I get on and you know it's this four story 12,000 square foot. You know, chimney, that's just on, totally ablaze. Um, so we week or two later we go and look at the other property, thinking all right, well, maybe we'll buy the lot and build something there and we get into the. Uh, I'm a little bit adventurous. So we kind of walked into the building which I don't recommend, um, and we uh kind of walked through it building which I don't recommend, and we kind of walked through it and realized that the fire had been centralized to two very specific areas and that the rest of the building was actually in pretty good shape. So I called a structural engineer friend of mine and we walked it even more and he realized this building can be saved, it's actually not a teardown. And so I ended up, through a friend, tracking down the property owner, and worked out a deal. We basically bought the property for a song. I think we paid $50,000 for it, and the first step in a property like that is you've got to secure it. So we board it up and make sure that is. You've got to secure it. So you know, we board it up and make sure that no one else can get into it. And then we, you know, work to make it, uh, whether it's as weathertight as possible. So, um, we hired a, the, the contractor I hired, hired a sub. So I had vetted the, the, the primary contractor. I did not vet the sub, which was my mistake, and the sub. So brick buildings are basically tensioned the way that they're supported is through tension, right, so there's cross beams that keep tension on the walls so that they don't fall in on one another. And so the subcontractor was charged with taking the decking off the roof and the rafters off the roof, but not the support, so that we could rebuild the rafters and decking and then put a roof on it so that it wouldn't rain inside and create mold and a whole bunch of other problems. And what those guys did was they cleared the fourth floor of all wood, all support, everything Dangerous, incredibly dangerous. And so I'm in New York. I got a phone call from my GC saying hey, we've got a problem. Okay, tell me what it is. My GC saying hey, we've got a problem. Okay, tell me what it is. Uh, the, they cleared. You know, my sub cleared the, the, the support of the uh property, or the fourth floor, and the back wall, which was 50 feet. Three courses of brick 18 feet tall fell into the back parking lot. Um, you know, first question is anybody hurt? No, uh, so good. Is anybody in the building? No, everybody's out. Okay, stay out, um, and I'll be. I'll be there as soon as possible. I was four hours away and by the time I got there, the front, which was um 50 feet, three courses of brick 22 feet tall, fell into the building and cracked all of the floor joists in the third and fourth floor, and that was a bad day.

Speaker 1:

That does not sound like a great day at all.

Speaker 2:

No, no, but you know the good news is everyone was fine, no one got hurt, and we were able to. Through insurance and a couple of lawsuits, we were able to get it back on track and I've since sold that to another developer. But that was probably my biggest curveball.

Speaker 1:

So what did I miss? What was the worst part?

Speaker 2:

So the the worst part was that well, the best part was that no one got hurt. But the you know the the fact is is that that building was no longer viable and so we ended up having to tear it down. And then I ended up selling it to another developer, who's I haven't been up there lately, but I imagine he's doing a good job with it, so hopefully it's a beautiful. He's already built a new building there, hopefully.

Speaker 1:

Okay. So that was one where it went so far backwards that it didn't really apply or fit to what you guys wanted to do, so you sold off the lot.

Speaker 2:

Correct, we. We toured the building down and then and then cleared the lot and then sold the lot.

Speaker 1:

And there are so many questions I have about that part right there.

Speaker 3:

Sure.

Speaker 1:

I don't know what you can, can and can't get into, but so you mentioned before about how you vetted the, the GC, but not the subcontract, and the subcontract is the one that actually ended up pretty much demoing your building.

Speaker 2:

Correct, yeah, and I have yet to make that mistake again.

Speaker 1:

Yes, and obviously for people that are getting into this and going to be doing flips, make sure you understand who is, I guess, liable for the subcontractors on your site. Is it the GC or is it the owner of the property?

Speaker 2:

So the GC in that case. But also, you know, make sure that you understand every single human being and their background. Who's walking your property?

Speaker 1:

right, yeah, and we work with an investor here in Milwaukee and he one of his buddies or his family member works for Master Lock and Master Lock now has lockbox codes that you can put about 10 different codes in. So you understand, you can give one to each subcontract or agent that's walking through and you know what numbers punched in to know who's on site. So there's so much technology these days to know what's going on in your building that if you don't know it's just because either one you're new and you didn't know to know it, or you're careless. So, all right. What did that do to your numbers? Because obviously, as you buy the property, you didn't think, well, if this falls down and we sell it, so did that ruin your numbers on that purchase?

Speaker 2:

Oh yeah, yeah, I had to actually pump in about $350,000 of my own money to make sure that the investors didn't lose their shirts, uh, and then, uh, insurance kicked in and I sued a whole bunch of people and ultimately got that money back and then sold the property for a profit. So, in you know, the, the, the challenge, the biggest challenge, was that happened in October, november of 2019. So, as we're going through this process, covid happens. I knew it Right.

Speaker 3:

I'm not going to go there.

Speaker 2:

So here in Connecticut we lost, I want to say, 18, 20 months worth of of docket time on the in the court system, so we couldn't do anything for, you know, the better part of almost two years. And so that's that's why I was pumping money into this is because I had to, you know I had to. I was working with the city to make sure that it was safe, because I didn't want it, I didn't want to fall into the, into the street. You know the building itself. Fortunately they built those buildings back then really, really rigid, so the rest of the building was actually stable. But you know it was. It was a challenging time, to say the least, and ultimately, when COVID released and we were able to kind of get back in front of a judge, we were able to navigate that fairly quickly and so that worked out for me and my company and ultimately for our investors. So that, you know, bullet dodged. But it could have been. It could have been a nightmare.

Speaker 1:

Yeah, and to make it worse, right during the period of time where you couldn't get in to get answers. So you had holding costs for that whole time. You've got security looming over your head that whole time, right?

Speaker 3:

Oh man, man I wouldn't say that's a curveball, I would say that's a the high and tight brush back maybe that's.

Speaker 1:

That's one right in the air yeah oh man well, and you stuck with it. So even through that, that process, you got through it. You still came out positive yes, two years later, years later, but you came out almost three Dang.

Speaker 3:

Yeah.

Speaker 1:

And you still had the bug to buy more real estate, which is awesome.

Speaker 2:

Which is crazy, but, yes, I did. Well, you know, I mean it was an anomaly, right, it was something that somebody made, a really bad decision that resulted in a really bad outcome, but it didn't affect, you know, the overall, my trust in the business. It just, you know, it taught me a very valuable lesson in terms of how I needed to run construction projects, even beyond what I was already doing. I thought I was doing the right thing. Right, I thought, you know, having contracts and hold harmless and insurance, and requiring the same of all the folks that were people I was hiring was appropriate. What didn't occur to me until that whole thing blew up was I needed to do the next layer of that as well, which was, if're bringing in a sub, they need to adhere to the exact same rigors. Um, and you know the gc. I don't know that the gc did anything wrong, um, but the the. But the fact was is that, um, you know that sub, he did not supervise his guys and they made a really bad decision.

Speaker 1:

Yeah, scary decision, yeah, like a little oopsie.

Speaker 2:

No, well, you know, fortunately, fortunately no one was hurt and you know all all is, all is well now. But yeah, it was. It was pretty stressful there for a while.

Speaker 1:

Yeah, wow. Well, thank you for sharing that story, cause I don't have one that comes even close to buildings falling over, and so that was that's interesting. But I want to kind of get into the phase of where you start selling off properties and turning your portfolio to do something else than than what it's been doing, cause it's hard for investors who they're like we've got these properties, they're operating correctly, they're great, like why change it, why do something else? So was there a moment for you that was like this is why we're trying to pivot, or this is why we're trying to sell and get into this asset class?

Speaker 2:

Yeah, because the goal is to get to 1000 units class. Yeah, cause the goal is to get to a thousand units. Um, and if I'm going to do that, it's easier to do it in chunks of a hundred to 150 units than it is to do it at you know six, eight, 10 units at a time. And so in order for me to be able to go after those much larger units, I need the capital, I need the equity from those smaller buildings to be able to go do that. And so, you know, that's why we started to unwind a lot of these smaller properties. For me it was, we took over, we brought our management in-house right after COVID, so it's probably been a couple of three years now, and turns out property management's hard, three years now, and turns out property management's hard. And so I now know why they made me pay what they made me pay because it's hard. And so a lot of it was just making sure that everything was running properly. And at that point we had, I don't know, 23, 24, 25 properties, and so I, you know, I was pulled, me and my team were pulled in so many different directions that it, you know, there were days where we just couldn't keep up. And so my thinking was if we pare that down and consolidate those properties into, you know, one or two much larger properties, then we can form teams on those buildings and it becomes a much more efficient management process. And so that's that's what we've been doing.

Speaker 1:

Yeah, no, that's smart. And I was told that like early on, listening to bigger pockets podcast, as I'm like working with Dan at a different company, as we're driving an outside sales, I am like eating up real estate podcast, right. And one of the things that they said was, if you're nervous about managing a multifamily, the best way I can put it is the advantages to multifamily, and the bigger you get, the easier. It is Right, because at the same, you could have a single family home and if you lose your tenant, you are 100% vacant. In a fourplex, if you lose a tenant, you're 25% vacant, and two, if you need to manage the building, you go to one spot and you manage four places, whereas if you go to a single family, all you do is one tenant and now you've got 10 doors in 10 different areas, or you could have 10 doors in one building. So, it was kind of their push to say get into multifamily because it's going to be, at the end of the day, easier for you to manage than just getting a single family and there's more security because you've got more streams coming in rather than just one.

Speaker 2:

Exactly, and they're easier to manage, they're easier to buy, they're easier to finance.

Speaker 1:

Yeah, I mean, it's all of those. Yeah, so very good idea and I understand the concept of selling off those smallers to get into bigger door counts per building, which is good, and I'm assuming that, seeing as you bought your first one, or your first few, early on, you're kind of running towards the end of your depreciation schedule on the properties.

Speaker 2:

So to a certain extent, but I mean we're paying. I mean the challenge in this market is there aren't a lot of opportunities to exchange.

Speaker 1:

So that was my next question was the 1031.

Speaker 2:

Yeah, you're biting the bullet and paying the taxes.

Speaker 1:

Yeah, so you couldn't find a property that you could actually 1031 in.

Speaker 2:

Not yet.

Speaker 1:

Yeah, because timing is huge with the 1031. If anybody out there listening has experience or knowledge on them. But there's very strategic and mandatory timelines on an exchange and right now in this market it's going to be very tough to do it. But if you can find one, it's great because, like you said, you can avoid paying your capital gains tax on it yep I just heard I just I just read something on that is there 1031 syndication?

Speaker 3:

have you heard anything about that? I've heard that there's people that are combining their 1031 exchanges together to buy a larger, like obviously more expensive, property, when they're bundling with another person that's in a similar situation as yourself, if that makes sense.

Speaker 2:

Yeah, I'm sure they're out there. The challenge with the 1031s these days is that I see a lot of people are overpaying for the buildings and I'm just not going to do that Right Pay the taxes and okay, fine, you know it's it, it is what it is, but so we're taking you know we're taking a step backwards, to take two steps forward, and not perfect, but it's, you know, I would rather do that than get into a situation where I'm over leveraged.

Speaker 1:

Yeah.

Speaker 3:

And they're trying to hold you. They're trying to hold you or take advantage of that right. If you're, if they know you're in a 1031 exchange, they can hire or increase the asking price, like you're saying right, and at that point it financially doesn't make sense.

Speaker 1:

Hey, eat, eat the tax or the capital gains on it, and that's it yeah, I wonder if there's a threshold, like running the numbers, if it's for pay or just pay taxes. I wonder if there is like that fine line that they have calced out and that's why they're doing it I'm sure there is yeah, there are other ways.

Speaker 2:

You know deltas, delaware, statutory trusts and to get off the clock and things like that. Um, that I've looked into, but, uh, I've yet to find something that's a good fit. So that I've looked into, but I've yet to find something that's a good fit. Come April I'll be writing a check.

Speaker 3:

We've got a 12-unit opportunity here that's expired. That we're talking about. Yeah, we just haven't haven't haven't uh made contact with the seller yet, but that was one that we were looking at, but I they want a pretty penny. Was it like 2.2 million, I think, for the 12 units? Oh my goodness, it's three, it's three separate four unit buildings, but they're all right next to each other.

Speaker 1:

Yeah, now cash flow really well right now, but obviously with that type of mortgage or uh yeah, that's a big number it is yeah, and it's tough because um we haven't ventured into purchasing multi-family yet yeah so all of our rentals are usually single families. We've done flips so we have yet to break into purchasing multi-family. We're currently building them, but okay haven't purchased. So that's a blue ocean that we have not swam in yet.

Speaker 2:

Yeah, so we're looking at development as well. We just bought a. It was actually a flip, Interesting story. So, right around COVID, again we got it. So we used to flip I don't know anywhere from a dozen to a couple of dozen houses a year, and we would send out postcards I'm a big believer in direct mail and so a lot of these you know. We would send out a batch and six months later somebody would raise their hand and say, hey, I'm ready. Right, Because we're not cold calling, we're not doing any of that, we're just simply sending out we're here, we're looking to buy in your neighborhood, and then we use social media so that people can check us out. In terms of that, we're legit and if we say we can close, we'll close. And so we had sent out our last batch I don't know probably early fall of 2019. I get a phone call February of 20 saying hey, I've got my. I think his grandparents had passed, a grandmother had passed and that they were looking to sell the property. And it happened to be a couple of miles from my office. So I said tell you what, let me go, drive by, I'll take a look at it and I'll call you back. And so it was a 1500 square foot ranch, a perfect flip property. And I went back to him and said, done, what do you want for it? And a you know, a brand new, like beautiful ranch, like that, probably go for, I don't know, 450 in this, in this market. And the. He's like, yeah, I want, yeah, I want 350 for it. I'm like that's a little tight. He goes, well, I'll tell you what I'll do. I'll throw in the land behind it as well. And I hadn't even looked at a plot, I hadn't even looked at it, I just looked at the property and I said, well, how much is the land? He said 58 acres. And I said, oh, okay, Well, what do you want for that? He said nothing, I just don't want to pay taxes on it. But I'll throw that in. And I said, okay, so 350, and it's the 58 acres and the house. You got a deal. Here's the thing. So COVID strikes like a month later turns out he's not the only executor, or he to figure out how to divvy up the money.

Speaker 1:

Yeah.

Speaker 2:

And they can't go through probate because the courts are shut Right. So two years later they're still going back and forth trying to figure out, ok, who gets what they finally in, I think like right around Thanksgiving of last year, so right around 20, uh, like probably November 2023, I get a phone call Okay, we're ready to go. And I said and, and I had left it, I had left an open offer. I said you know, I'll stand by this offer for you know, in perpetuity. You just tell me when you're ready.

Speaker 1:

Yeah. And that's a pretty sweet offer. I would. I would have that outstanding too.

Speaker 2:

Yeah, no problem Right.

Speaker 1:

Yeah.

Speaker 2:

Open-ended. And so they said, well, we're ready. And I said, well, the money I had set aside for that property I've spent and recouped, and spent and recouped probably three or four different times. So I'm going to need 90 days to close, which they said no problem. And so we ended up buying it in march of this past year.

Speaker 3:

So yeah, crazy awesome, so you congrats they didn't ask for market price, they didn't, they just accepted what it was yeah, we ended up paying, we ended up helping them out paying the uh this year's uh taxes. I was gonna say they probably had back taxes that they weren't paying. They just wanted that, whatever type of proceeds they could get, that that's crazy.

Speaker 2:

Yeah, and so we ended up buying the property and there's a tenant in there right now and he's moving out in a few weeks and as soon as he moves out we're going to work. But right now we're doing all the survey work for the and feasibility studies for the land to figure out what we can put there. And you know, the intent is to put a whole bunch of multifamily back there at some point.

Speaker 1:

That's awesome.

Speaker 2:

Yeah.

Speaker 1:

That's like that's a you. You hear stories like that and you're like wow, they stumbled on a good one, but I don't really think it's stumbling Like you put in all the hard work and the development before to get yourselves in the position where you can get presented those.

Speaker 2:

Yeah, that family probably received a dozen postcards from us over the years, right? So, and um, yeah, so it's what? What's the uh, what's that old axiom? Uh, luck favors the prepared mind, right? Oh, it's just, you know it's. It's a matter of building a brand and then ultimately building trust, and at some point in their minds, we are in the right to do business together. And they called us.

Speaker 1:

Yeah.

Speaker 3:

Yeah, you were probably one of the first people to send them a postcard, and probably one of the most recent to send them a postcard too, so they're going to be like all right, we got that, got that said in the back of our mind, even if it's subconsciously they're going to where's that postcard? We'll call this guy and yeah.

Speaker 2:

Yeah and yeah, yeah, yeah. No, they got the gentleman told me it was it was literally there was a magnet on his fridge with our postcard.

Speaker 1:

That's cool. Yeah, front and center. Good luck with that, we're in we're in the process.

Speaker 3:

We went through the survey, working with the city. We're taking marcus. Uh, was it? That was the first sheriff sale that you bought.

Speaker 1:

Yeah.

Speaker 3:

Yeah, and it was a double lot trying to parcel off the other side. Now they're going to build a duplex on it.

Speaker 1:

Oh well, okay. So that lot was a mailer, it was kind of similar to yours I sent out. This was early on, and this is when we're still I'm still outside sales and I would take different directions to every place I had to go, and then I would take different directions to every place I had to go, and then I would take pictures on deal machine driving race and then send out a mailer to the the owner, not the property where the owner lived. And he called me up and I honestly wasn't prepared because I just this is like three, four months in I get a phone call like hey, I got one of your mailers Like I would, I'm willing to sell the property and I'm like, okay. I get a phone call like hey, I got one of your mailers Like I'm willing to sell the property and I'm like, okay, I run a quick little comp thing and I meet him at the property and he talks about how his mom lived there or his mother-in-law, and then they use it as their lake house and they're just kind of done with it. They don't use it. I was like all right, what do you want to sell it for? And he was like a hundred thousand. I bought it for 97. So I'll sell it for a hundred. And I was like I'm not even going to, I'm not going to barter with this one, I'm that's fine, say thank you and sign the paperwork. Yep, that sounds good. And then I didn't know, because he kind of hesitated, like he thought there was going to be some bartering back and forth where I just kind of agreed to it. But yeah, it was on a double lot and it already. You had to put 20 to 30,000 into the house and now that's paid for. So now we're sitting on two lots in a nice area where we can put up two duplexes and pull the same amount of rent. So, yeah, it's. It was a sweet deal, but I stumbled on mine because I was only four months in. You're putting in a whole marketing system to get there.

Speaker 2:

You know I don't believe in luck, right? I mean, I think that it's just a matter of being consistent.

Speaker 1:

Yeah.

Speaker 2:

Identifying, being very clear about the properties that kind of fit your buy box right, and then identifying those in the marketplace, like you know I mean. So I'm a data-driven kind of guy, right, and so I know that there are. You know, at one point there were 1,208 properties in the state of Connecticut that I had targeted to own, and so we would reach out to them on a monthly or quarterly basis just to see if they would entertain an offer, and every once in a while somebody would say yes and we'd make an offer, and every once in a while some of those offers came to fruition. Right, it's that simple. I mean, it's not a matter of there's no science to it, it's just being consistent.

Speaker 1:

Yeah, who's the salesman that always says always follow up.

Speaker 3:

Make sure to follow up too.

Speaker 2:

Yeah, the fortune's in the follow-up, right, I mean, that's, that's where you, that's where you make it, because you've got to touch. You know, being a marketing guy here, I mean you've got to touch a human being no less than seven times before they connect. I have a problem with you. Have a solution that could solve my problem to okay, you have enough credibility that I'm willing to listen. Okay, now I'm going to listen, and now I trust you, and then, ultimately, okay, I trust you enough that I'm willing to do business with you. Right, it's a process that the human brain needs to go through, and so you know you've got to be consistent and constantly touch those folks so that they they know that you're for real.

Speaker 1:

Yeah, and I'm sure that's what you're. You're preaching to your. You said you're educating new investors as well.

Speaker 2:

You got an educational program.

Speaker 1:

And then you mentioned that we're launching a program.

Speaker 2:

No, right now I'm just informally mentoring people. I always tell people I'm a cheap cup of coffee, right so? Or a cheap date. You buy me a cup of coffee and I'll sit with you and answer any questions you have. And if you want to talk about a specific topic, I'll gladly tell you everything I know, because it's a big world out there. If you find a deal that might profile what I'm looking for, fine, you know I'm happy for you because I'm doing other things that are garnering me deals as well. So you know it's rising tide floats all boats.

Speaker 1:

Yep, that was a theme of our last company.

Speaker 2:

Really yeah.

Speaker 1:

The rising tide rise, or what is it? Rising tide raises all ships. Yep is what they kept saying yeah so, and it's true, I mean, it doesn't make sense big world out there. Yeah, you can slice a pizza a whole bunch of different ways and everybody gets to eat yeah, and it's amazing how friendly and how many people within real estate understand that, because we've talked to countless people on podcasts, we've done deals as me as an agent, we've done deals with me as a buy and hold or a flipper and I think very few have I actually crossed with the same agent or the same seller, same buyer, and that's just proof that, like even in my little area or our little area of Wisconsin, it's very hard to cross streams and step on toes and get in the way of things, cause it is it's vast.

Speaker 2:

Sure. So even Connecticut, at small state, is this one I mean there are. There are so many deals flying around that, uh, and you know you can only do so many, right? So pick, pick the one that is the best that profiles you. And then if I have a deal that I know that profiles that is interesting to one of my colleagues, I'll gladly pass it along, it's fine.

Speaker 1:

Yeah, yeah, that's a good mentality to have. It keeps the industry going in a positive way. Yeah so and I'm sure you'd mentioned that you have a podcast as well. So, as long as, as well as your cheap cup of coffee, if you want to listen to more information, the real estate underground is your podcast.

Speaker 2:

That's right.

Speaker 1:

When does that air?

Speaker 2:

Tuesdays, and it's on any channel on Apple, spotify, youtube, wherever.

Speaker 1:

Awesome. Is there like specific topics you get into, or is it kind of a general? Today we want to talk about this aspect.

Speaker 2:

Yeah, so a lot of it's multifamily, since that's what I do. But we have rehabbers. We've had folks that invest in RV parks and mobile homes and self-storage, and realtors and talk about how to work with investors. The whole idea here is to make it educational and kind of give back. I've been very fortunate to have a whole bunch of mentors who threw an arm around me. Either because threw an arm around me, either because they saw something in me, or they felt sorry for me or somewhere in between, and and you know one of the ways that I returned that, because they didn't want anything for me. The only way, the way I returned that is through the podcast, and so you know we try to drop as many gold nuggets along the way as possible.

Speaker 1:

Yeah, that's good and that's what the whole premise of this was was to educate. I wanted people to get into it and find that, just like you, the first deal may be scary. It probably will be scary.

Speaker 2:

It will be guaranteed.

Speaker 1:

But those will, it'll pass. And it won't be as scary and you'll actually make, like you did, a nice little retirement where you can basically retire from your full-time job. I mean you didn't retire to like-.

Speaker 2:

I didn't retire.

Speaker 3:

I still work.

Speaker 1:

But yeah you just have a different career now.

Speaker 2:

Right.

Speaker 1:

So that's a very, very cool and interesting story. A lot of hard work put in on your side, so kudos to that.

Speaker 3:

Thank you.

Speaker 1:

And man a wealth of knowledge.

Speaker 2:

Thanks.

Speaker 1:

That you share with us and that you share on your own podcast.

Speaker 2:

Yeah, thank you, it's a lot of fun.

Speaker 1:

Yeah Well, that's cool. Obviously they can jump on see you on the podcast, but is there a better way for people who one? It's a niche area multifamily, for those people that want to get into multifamily to buy you either, if they're in the Connecticut area, a cup of coffee or a digital cup of coffee? How would they get ahold of you?

Speaker 2:

Get on a Zoom and I'll have a conversation with you that way. Yeah, so typically, the best way to get ahold of me is through my website, which is clarkstcom, and or you can hit me up on pretty much any social media. I'm edmatthews4 on everything except TikTok. I promised my kids I wouldn't get on TikTok.

Speaker 1:

Hold strong, ed hold strong.

Speaker 2:

They don't want to see me lip syncing or dancing, so that's fine, I don't want to do that either. And and then Clark Street Capital on all social media channels as well.

Speaker 1:

Awesome. Oh, and I forgot to ask you about Clark Street, capital. Sure, do you have a couple more minutes or do you got to get off, cause I know we're at a time I'm good, I have time. So Clark Street Capital where does that fit into your process in terms of purchasing real estate? Is that something that you just added on?

Speaker 2:

Because that. So that is the company that acquires the multifamilies. It's also the company that now has launched this debt fund, so we're raising money to it's like think about it, like the gold rush in the 1840s, right, first millionaire, the first millionaire in that 1849 gold rush was John Sutter, and John Sutter wasn't a gold digger, he was the guy that sold the shovels and the sieves to the gold diggers, right. And so the debt fund is designed to be the shovels and sieves, so that we're taking in money from money partners and then loaning it out at a bit of a higher rate, hard money rates and so the investors, our money partners, we don't charge any fees. So the investors get an 8% return on their money every quarter and we get, you know, we live on the arbitrage. So we were loaning that money out at 12% with three points up front, and so we're using the three points to, you know, pay for the fund operation and create reserves, and we're living on the arbitrage between the 12 and the four, or 12 and 8%.

Speaker 1:

Yeah, yeah. So not only can you help with knowledge, you can also help with lending.

Speaker 2:

Indeed, and in fact, we have about 75 or 80 flippers and small multifamily folks who are taking down properties, and so my role in that fund is to vet the investors, the actual construction projects, and make sure that they've thought through everything and so they get that added value as well. And then ultimately and my partner, mike Meyer, is the person who does all the financial underwriting and servicing of the loans- Okay, and I heard you can do small to medium investors.

Speaker 1:

So for all those small to medium investors who feel like they're stuck and don't have capital, we've got Ed here. So as long as your deal makes sense and you pass the background check, keep going.

Speaker 3:

We can help you.

Speaker 2:

We'll have to keep doing what Marcus calls our Rolodex.

Speaker 3:

We'll have to keep doing what marcus calls our rolodex. We'll have to keep your name name available too, he likes to use those terms is still relevant at least do.

Speaker 1:

Yeah, it's just electronic now yes, but everybody knows what a rolodex is at least the old guys like me do right I. I remember sitting at my counter trying to call my friends and I'd flip through to find his number and then get to my landline phone. So it's still relevant. It might be out in, like the next five, ten years, where all the young kids take over right next to your rotary phone?

Speaker 2:

probably right yeah, I still have the spin dial one I think if I handed my daughter a rotary phone, she wouldn't know what the heck to do with it you should ask her to look up those videos on tiktok.

Speaker 3:

That you really funny one I was just gonna make.

Speaker 1:

I was just gonna make that point on tiktok. They have two generations, like a mom and a daughter, a dad and a son or whatever combo, and they're like, okay, how do you pick up a phone? And like the kids, with their flat hand, put it, it up to their ear where like the older generation, do the phone.

Speaker 3:

They're like how do you hang it up?

Speaker 1:

And you do that. They just like look at their hand and like touch it.

Speaker 3:

Right.

Speaker 1:

There's these generational nuances that escape my mind, cause I don't think about it.

Speaker 3:

Yeah so awesome. All right cool.

Speaker 1:

We're going to put all your contact information in the show notes so that any investor listening or someone who's curious about multifamily including myself can reach out to you he's doing and then, if anybody's listening, tune into that podcast as well, because just within our hour and 20 minutes that that was super cool stories that you shared. I know you've got a bunch of knowledge left in that podcast. I'm gonna have to catch up. How many seasons are on there?

Speaker 2:

Oh goodness, I think we're probably at about three seasons, I want to say 120 or so episodes.

Speaker 1:

Oh, all right, so I got a lot to listen to. Yep, awesome, all right, awesome Thanks for the time I Awesome. All right, awesome. Thanks for the time. I appreciate it Enjoy the weather, and we'll catch up with you soon, cause I'm like that. Once you sell those last five properties, I want to see how North Carolina is going.

Speaker 2:

Okay, we'll do. Thanks, marcus.

Speaker 3:

Awesome Thanks. Dan have a good weekend. See you later. All right, you too. Bye guys, bye.