Inside a $200,000 Prison Converted Into Apartments and a Playground

Original automatic captions. Names, numbers, and punctuation may contain transcription errors.

0:00 I am here at Matt Hawkins prison. This is a really cool conversion. I've converted hotels. I have never even
0:06 imagined taking a prison and turning into residential. So, I'm here with the lumberjack landlord. Uh, so we are
0:13 making do in the prison. He actually kept the jail cells in here. This will be the kids lunchroom. I am so excited
0:18 to show you guys this building. This is one of the coolest projects I've ever seen.
0:24 [music] And this is the jail right here. Don't know why. Yeah, this is
0:29 we've made it. Yes, we have. Yes, super close by. So, this is all brand new mast heads.
0:37 So, [music] yeah, absolutely beautiful configuration. Um, this was a $20,000 problem. This stair rail and they
0:44 basically the city said you have to have suffer the 4in [music] sphere rule. It's like a 4in sphere.
0:49 Y and if you can stick it through any part of a staircase Yeah. that means that a child's head can get
0:56 stuck and it does not pass. So, [music] the challenge that you have is that we had to add these pieces. They said, "We
1:03 need you to tear it down and build a brand new stairwell." That was going to be 20,000 bucks. [music] Instead, I called my walder friend and I said,
1:08 "Hey, this is what I want to have happen." He's like, "Yeah, I can build that." And we [music] built it and that was $1,900 bucks,
1:14 dude. So, we saved $18,000. That's a good start. That's I mean, 18 [music] penny $18,000
1:20 saved is $18,000 earned. Yes. Something went right. Yes. Yes.
1:32 This was the deal that I worked [music] out uh to actually take a mall's inside
1:37 playground. We made a [music] deal for me to take all of their toys and all their padded flooring. They were kind
1:43 enough to donate it all. This will be an indoor kids playground. Right where the
1:49 entry door is, we put a wall right across so moms can sit there on couches. [music] Then there will be a gate. So
1:54 they can literally let the kids in the gate and the kids can just run around here. And because nothing is going to be taller than this, you can senior kid
2:01 from any point. So is this going to have a daycare component or is this just an event before the kids?
2:06 Only this. So no, this is actually a [music] full-fledged indoor playground
2:12 business where we wanted to be an impact in the community. And so parents [music] or grandparents because so often you
2:18 have parents and grandparents that are watching kids. And so the biggest challenge is they get stuck in a cooped
2:25 up apartment for the entire winter time [music] when it's really cold here. And so for months and months and months, they don't get outside space. They don't
2:31 get a play a chance to run around. They're going to be able to come in here and for 20 bucks, they're going to be able to play here for unlimited time for
2:37 that day. And they're going to be able to get food [music] next door. And it allows mom, dad, grandma, grandpa,
2:43 auntie, uh [music] sisters, whatever. It allows all of that opportunity for them
2:48 to sit in front, chill [music] out, be on their phone, and let their kids just run around. Awesome. This is going to be the cold
2:55 kitchen, but we got all these kids tables donated. Oh, nice. Which was Yeah. Which was super awesome.
3:01 And so those things seat uh those seats say like 16 [music] a piece. And so that's what we'll use over here for uh
3:09 for our you know, kids [music] part. Kitchen just means there's no stolen. Correct. There's no hood or anything
3:14 like that. What about this deal when you were shopping for [music] this property? Cuz this doesn't look like anything else you have. No.
3:19 So, what about this deal made you say this is the project we want to do? Money. Oh, I like that. That's a good answer.
3:25 That's that's why I I like buying things. Yeah, I'm very simple. Very simple. Um the big thing was honestly for [music]
3:31 us it was uh we were able to buy this from the town. It was a dead asset. Um
3:37 so the town had basically done the [music] town things towns do. Yeah. which is they reassess it
3:42 and they say, "Oh, it's only worth this amount of money." And so [music] the tax bill was $600 a month here.
3:48 Oh, okay. So that's all the town was collecting in taxes from itself was 600 bucks a month. And you bought this from the town.
3:54 I did. I did. And they were tell they they were a huge fan of the project while you were buying it. Yep. And as soon as you bought it, they
3:59 immediately permitted everything and were super easy. Right. Yeah. Just [music] like that. Yeah. You stole a page right out of a
4:05 book. Yeah. Sure. It was a challenge. [music] I was like, "Oh, we didn't mention that that's actually a two-month process or that that's a 3-month
4:11 process." I'm like, "No, you didn't. I know I would have kept track of that." Oh, no. The coolest part, we don't have
4:17 a light floor, but here's the jail cells. Oh, there we go. A huge piece of having a playground is
4:22 having a discipline area. Yes. Exactly. Exactly. Non-ironically, Matt has four kids.
4:28 Yes, it's true. [music] Yep. So, that is a real deal cell. This is a old police station. Um, and the
4:35 drunk tank is in the last one. There we go. They would put you right in the drunk tank, but these are actual legit jail
4:41 cells. Oh, that is so cool. [music] Yeah. I love the decision to keep the jail
4:48 cell. Oh, heck yeah. It's makes it [music] way it makes it You get the a whole feel for the history. It's so cool.
4:54 Can we see the apartments? Absolutely. Cool. Upstairs.
5:03 Oo, welcome to jail.
5:09 Question. Click together or glue down LVP standard construction. What is your preference?
5:14 Click commercial. The residential stuff is too thin. The commercial is the right
5:19 thickness. And because we took [music] the time to reflo and basically we redid
5:25 the floor the entire [music] building, this is uh this is what you get. Dude, this is awesome.
5:31 Killer, [music] right? So, what we did was a lot of people think you have to get remnants when you do smaller pieces.
5:38 What you do is you let them know. [music] I don't have anything longer than a 36 in uh [music] uh span. And
5:46 they'll actually you can have them CNC a slab. [music]
5:52 So, because we had four kitchens, we bought two slabs and we had like one
5:57 piece that size left over. Take a wild guess what that [music] with that kitchen with granite with same that's
6:05 leather granite. So, uh have you ever My favorite My favorite. Have you ever felt it? We This is my favorite thing to put in
6:11 units. It's so just tactile. That's a word. Tactiley perfect.
6:17 I love it. It's awesome. People should guess in the video now what they think that kitchen actually costs and then
6:22 Christian will figure out what he's going to give you. Yes. Whoever whoever is closest in the comments the day that we launch this
6:28 will get a free copy of my book that's coming out on the 22nd because I actually have something to give away. We
6:34 should feature the cabinets because this is ridiculous. So one of the main complaints you get in
6:40 apartment buildings is I always hear my neighbors [music] next door. You're never going to hear your neighbors next door. I mean, look how hard you have to
6:46 So, like that's the thing [music] is look how hard you have to throw it to get it to close. Yeah. And then same thing with the drawers. Drawers drawers
6:52 are actually double piston drawers. Oh, that's perfect. Yeah. So, absolutely phenomenal.
6:59 The cabinet company that does these. Yeah. So, yeah. So, we actually we we realized we were buying far too many cabinets
7:04 from our cabinet supplier and we're just like, why don't we just open up a we just need our own? And so, that's what I did. So, I just filled out paperwork
7:10 with a couple of different makers, manufacturers, and so we carry the just those two lines. When people join my
7:16 course, when they join the boot camp, they actually get access to cabinets for wholesale price. Oh, that's epic.
7:22 Yeah, it's pretty cool. Yeah. So, we've got a bunch of people that became students, then they did the [music] boot camp, and you know, we have
7:28 two or three guys that have done a dozen kitchens. Um, and then we have a bunch of people, you know, literally hundreds of people
7:34 that have done one or two, even if it was just for their own house and it wasn't for the rentals. But most of the time this would be a 12 to $15,000
7:41 kitchen. [music] Um this kitchen all in was and that includes the gr.
7:47 It is so nice. Yeah. It's so nice. Yeah. It's like where else are you going to get that? Yeah. You know for 7,000 [music] bucks. And
7:53 that again it's granite. It's a high-end faucet. It's you taste a butcher block. Um [music] that will also include the
7:59 handles that we'll put in here as well. Yeah. Um but yeah, it's a awesome spot. It
8:04 really is. It's just a great spot and it'll [music] be it'll be pretty. A this will it'll be pretty. This is bedroom
8:10 number one behind us. Um [music] and so if you listen real quickly, you won't be able to hear it on camera.
8:19 You can't hear anything. [music] These are triple pane acoustic windows. That's why we can't hear it off camera.
8:24 You can't hear it. You can't hear it off camera either. You can't hear it off camera either. So triple pane. How So how does you
8:30 You're talking to me about this. The the the install of these is also unique cuz these will transfer like no heat. This
8:35 is like having a wall that you Yeah, exactly. [music] So, basically what we do is we wall with our with our
8:41 studs. Um and then this is actually like what's called a panning system. And so [music] it the metal pieces come cut,
8:48 then you float the window in there with a couple of stabilizer points and screwing it into the edges. Mh. [music]
8:54 Um, and then you're able to fill it with spray foam all the way around it, so you can put your hand to the window and you
9:01 won't feel the cold transfer, [music] which is absolutely insane. Like it's it's pretty much the same temperature as
9:06 the wall. Yeah. There's no difference. None. Oh, it's awesome. Yep. As this was a new supplier. These did
9:12 not come in exactly as you expected. [music] Yeah. They were scratched up, murdered. Like they they did they did not have
9:18 they did not have the manufacturer. Did they get damaging shipping or could you tell? QA. Definitely QA. Yeah, because [music]
9:23 it gets delivered. It gets delivered from the manufacturer. So, this is one of those things that save you a bunch of money
9:30 longterm through energy efficiency. Yep. What is What is What does this cost per window?
9:35 So, these windows normally you'd find a nice what's called a wide birth double.
9:41 Um cuz [music] this is a bigger window, you know, that's a pretty huge sash. Yeah. Um you know, and uh for those of you who
9:47 don't know, this is this is a sash. This one piece of the window. This is an upper sash. This is a lower sash and
9:53 [music] double hung. That's what kind of window it is cuz it's doubly hung. Um
9:58 uh if I ironically mass nicely. [music] Exactly. True story. If I had a nickel for every time I'd heard that, I would
10:04 have been able to buy this property twice. Um but what's really great about
10:09 this setup is that a typical window will cost you a [music] typical um you know
10:15 double pane energy efficient window. This is an Energy Star Plus [music] window. Mhm. Um they run they run about
10:22 800 to 900 a window. So it's an extra 300 bucks a window. Wow. You know, times the 30 windows that we
10:29 did. So it was an extra basically $9,000. So did you have to fix them up or did they replace the windows for you?
10:34 Um [music] so it was the framing around the windows. We negotiated with them that we would get it painted and that
10:39 they would pay for that. Okay. Because they were like, "Hey, we'll replace them." And I was like, "Well, you originally told me it was going to take me 4 [music] weeks to get them and
10:45 it took 12. So now I now I don't believe you. I can't and I can't afford another 12 weeks um because [music] this was
10:51 holding up that process. But um just little features around, you know, around something like this where we use the
10:58 [music] we use the uh flat uh what we call pancake lights, but we use all the pancake lights. When we buy those, we
11:05 buy them in bulk, so we get them for seven, eight bucks a piece. Oh, that's perfect. You know, and it's like it beats having a boob light hanging down in the middle
11:11 of your room, you know, which is not [music] conducive. And then these I was just going to ask that looks
11:16 modern. No, it's very [music] super high. So that is instead of a mini split where you see those big ugly things hanging on
11:23 the wall. Instead of that, you spend a little bit more and you can get these things called cassettes and they go right in the
11:29 [music] ceiling. Okay. One that looks way better. Yeah. Is it does still hook up to the outside like a standard. So this this is
11:35 effectively a mini split but way more aesthetic. Correct. It's beautiful. Okay. And you can push air from all four
11:40 sides. Yep. They are absolutely [music] amazing. And this setup is not that much
11:46 more expensive than a typical mini. What is the price difference? Mini split for this space would have been about 7,000 bucks. And when you go
11:53 with these cassettes, it ends up being 859 grand. Oh, really? [music]
11:59 Do these last longer as well, or is this just aesthetically way better? So, these haven't been out long enough to know how much longer they last. These
12:05 have been out a few years. Um, but so far there's no [music] market difference between this and what you find with a
12:11 typical mini split hanging off a wall. Okay. one way elevated feel. If anybody's wondering what style doors
12:17 these are, these are called Craftsman 3es. Oh, nice. And so if anybody's wondering, because it used to be a jail cell, that's why I
12:23 did the two slots right there. They look like jail bars. Oh, that's clever. Yeah. So
12:28 jail inspired. Yes, exactly. Jail inspired. So the way that this living room is configured is it is TV on that wall and couch here and
12:37 then coming out to here. So we expect like a sectional right here, TV on that wall and then fridge, stove, dishwasher
12:44 in higherend stuff we always do. I I was going to say and I was going to ask does that depend on [music] asset class in your portfolio?
12:50 100%. We we same same thing. Yes. Dishwashers for insurance. This is a bathroom, but that is the tile work.
12:58 So what what would you expect this to rent [music] for? Cuz I haven't seen prison rental prices recently.
13:04 Yeah. Me either. Um we'll [music] in my state is free. Yeah, exactly. Well, free to them. Very
13:11 well. 52 grand a year for you. I expect that these will be probably 20 2200
13:17 2,400. Mhm. Right around there, which is a [music] lot. That's amazing. Yeah, it's a lot of value. Washer,
13:23 dryer, combi unit right there in the closet. [music] Perfect. So, then they can just do one of these.
13:29 Piece of cake. This design is just super clean. Thank you. And it it's high-end, but it's simple. They're not wasted
13:36 money. Correct. So I did I architected [music] the entire design. This really Yeah. This is 100% my design.
13:42 This is the closet and then these are the access. So this is access to the shower next door. This is access to the
13:48 shower here. So the most needed thing ever. Well, you don't need it till you need it.
13:53 Everybody everybody walls it off. And for us, we rather, you know, fill it, paint it, make it an accent [music]
13:59 point and we'll put the bars right across there so it'll be hidden. But when we ever need access, somebody can just
14:05 slide their clothes the other side. We can pop the panel. We get access right to the mixing valve. It's a [music]
14:10 hourong change. Instead of a 4hour long bring sheet rock brack mud it, paint it.
14:16 Don't have to do any of that stuff. We can literally just pop it off. Have the team forget to clean, have the tenant call you back because they're upset because there's sawdust
14:22 everywhere. Yes, correct. 100%. [music] All right, we'll go to unit number two. And how many total units do we have
14:28 upstairs in this building? So, we have four upstairs. Yep. And we have [music] uh four downstairs.
14:34 Nice. Yeah. This one uh will eventually do a roof deck.
14:39 So we'll basically we'll basically have like something that boxes out of the wall where they can pull it down and
14:45 it'll be stairs and they can walk right out. So cool spot, cool feature. Um this
14:51 layout in here is basically couch comes [music] off the wall here. Um, we actually have two cabinets that will get
14:57 mounted [music] on each side and then a butcher block across the top and then the washerd dryer combi unit is going to
15:03 go right in there. It will have a little sliding door on it or a little pop out. How many weeks are you out from full CFO?
15:09 So, first CFO we're uh only about 3 weeks. Okay. All the cabinets, all that stuff is already here. But, um, yeah, we're only
15:15 about 3 weeks. And you have a furniture design, but you're not furnishing this, right? Correct. Furniture design, not
15:21 furnishing. Correct. Perfect. Bedroom number one. And so the cool thing here is I designed it where
15:26 [music] every single room can take a king-size bed. Oh, that's clever. Yes, I love king size.
15:33 As a as a king-siz bed person, I can't imagine not having a king size bed in any size apartment.
15:38 If you do if you do a king And so the other thing that we do too is we lay out so I lay out all my rooms.
15:44 Yeah. And so here we've got an outlet for each um you'll have an outlet for each
15:50 nightstand. Oh, nice. first [music] and then you boom TV on the wall. We put internet in
15:55 every room. And the reason that we do that is because maybe you don't like your roommate and you don't want to hang out
16:02 with them. [music] So that makes it really super easy. Oh, and then decent size follows. I mean,
16:08 that's a decent size for a rental closet. You know, it's not like this little one door thing. Yeah. So, with full bypass, [music]
16:14 you've got the inches on each side, so you can actually put in a decent a decent amount of focus
16:21 for sure. Here is the uh here's [music] here's a here's a fully lit bathroom.
16:29 I your house this week. Yes. [music] Viper toilet. Is that Okay. So, it's So, you have a Viper
16:34 toilet shower. I'm assuming that that is Wallace [music] Gorgeous. Probably a lower flow shower head as well.
16:39 It is. Yep. How much money do you save running a project like this where you actually think [music] about water
16:45 consumption from like are you paying utilities? Do you test pay utilities? So usually we'll pay so the way that the
16:51 city goes is they pay you spend a lot of money paying for extra meters and so we want to reduce [music] our costs as much
16:57 as we possibly can for tenants that are coming in and tenants that are going to live here. So we don't want them getting
17:03 a meter charged for this and a meter charged for that and before you know it it's 150 bucks a month in charges.
17:08 [music] Yes. And you've not even gotten gas delivered yet. And so this is a direct you are saving your tenants money and [music] making it
17:14 easier to live here which is so we'll do water sewer. We'll do water and sewer. We'll pay for that but we'll incorporate it essentially in the cost
17:20 of rent. So we can go from 4 gall per flush to 1.28 [music] when we can go
17:26 from a head that goes you know 5 gall a minute down to [music] you know 3.1 or 2.6 or 2.2. We want to
17:36 make sure that they're still getting [music] a great experience. The cool thing is is that if you can do low if you do this mix where you do the actual
17:43 head and [music] a wand. Yeah. You can actually have the head be just over 2 gall per minute.
17:50 Yes. So if you have the head be [music] much lower, they'll use the wand to do the
17:55 important things you need to do in the shower. And so you're [music] using for a majority of your shower, you're using
18:02 less water for a majority of your shower. That's super cool. and the Viper toilet.
18:07 You were you were what's cool or unique about this? So, if you get a shot of the side and [music] you look at what's called the
18:13 discharge pipe. Yep. The way that they configure that discharge pipe is you actually get the force. So, you you we end up with fewer
18:20 clogs and you have fewer issues across the board. Um and we use these toilets because they don't clog. They're more
18:27 [music] comfortable. They're prop they're more ergonomic. They're they're well height. They're they're a good height for doing business. Um, and
18:35 again, the key for us is overall cost of time. This is a 1.28
18:40 gallon per flush. That's fantastic. It's a major difference maker when you
18:45 [music] look at how expensive city water, town water, uh, w uh, sewer bills
18:51 and what they [music] charge for those. You could literally go from uh, you know, in a building of this size, you
18:56 can go from a $600 [music] a month bill to a $200 a month bill. And price difference on the toilet for
19:02 your onetime payment? almost nothing. $229, [music] $2.49 depending. Whereas a decent toilet without that
19:08 maybe so maybe $100 one time save $100. I mean, you're probably not going to the unless you're buying Glacier [music]
19:13 Bay, you're probably knocking on the door 200 bucks anyway. So marginally more, maybe 10%. It'll pay
19:19 for itself in the first 60 days. Oh, awesome. Yeah, it's pretty powerful. Viper toilet. [music] Viper toilet. Gerber Viper. You're
19:26 always having to figure out what's going on with the space. So everybody said, "Yeah, put the water heaters in the
19:31 basement." The problem is is that that's probably 100 ft of water [music] line. So by the time the water would get there
19:37 and that thing kicks onto the basement to start giving them warm water, they would get very [music] intermittent warm water. So now with how this is set up,
19:45 none of these things are more than 20 ft away from a shower, which is closer than [music] most single family home. This is
19:50 still near instantaneous. Oh, that's so cool. Yep. So we mostly I love how clean this is, too.
19:56 Yes. That's when when you see plumbing done right. Correct. This is art. We are militant about
20:01 [music] it needs to look clean and it needs to be easily shut off. So, I'm a big king on shut off valves. I want as many shut
20:07 offs as I can get. [music] So, I can quickly shut the water off. Boom. Right
20:12 here. There's no water [music] coming to this system. And that and that's super powerful. It's isolated. I can shut this
20:18 off. If we ever get a leak, if you show the pan here on the floor, if there ever is a leak, it will actually when this is
20:24 plugged in and the sensors there, this will actually turn a valve and shut [music] off the water altogether from
20:31 coming into the system. All of them have to have a pan, but that doesn't really matter if it fills with water and floods your whole lower floor
20:36 anyway. Correct. What is this actually called? And where does one get this? This is super cool.
20:41 It's literally called leak breaker. Oh, there you go. And what it does is it actually will close if the [music]
20:47 sensor in the pan gets wet at all. It will instantly close and it will send an oil.
20:52 How much does that little upgrade cost? Couple hundred bucks. That's it. And it could save you tens of thousands. I was going to say floods
20:58 easily. Well, [music] the other thing you can do too is is you can actually do that on a line when it opens. You can
21:04 actually these things still work [music] once a line goes open too. So it doesn't have to necessarily always be something like that like a sensor. It can actually
21:10 also do it based on the flow through the line and how constant that flow is. It again is it's the little things that
21:16 [music] save you tens of thousands of dollars, which when you're talking net operating incomes, you're talking
21:22 millions of dollars among a portfolio like yours. The town wanted expensive exterior
21:28 scapes on these different units. What we were able to do was I looked at the code, dissected the code, and the
21:34 [music] reason that they were saying that was because this door was too far from that door. This door didn't exist.
21:40 It used to be that window. [music] So, we built this doorway. Oh, simple.
21:45 In building that doorway, we now no longer need fire escapes on the windows. [music] So, you saves a ton of money.
21:51 Yeah, I would say probably 12 to 13,000 bucks every single time I turn around. It's 20,000 bucks or whatever. And
21:57 typically, you'll [music] find that multiple times. And then like the kitchens as an example, you know, we did
22:02 all of the kitchens [music] uh including appliances. We'll be about
22:08 50,000 bucks into all the kitchens. Well, and everything is really like these these sinks are fantastic. The
22:14 wood's fantastic. The color schemes are fantastic. It's [music] it's clean, simple, and nice. Yeah. So, I appreciate you saying that.
22:20 So, there is a magic to this. People will look at this and say, "I don't understand why you're configuring it
22:26 this way." So, we're doing it for three reasons. One, [music] we want nothing more than a 36 in span
22:31 for any piece of brand. Okay, number one. Number two, we [music] want to make sure that we're not making them
22:37 do a sink cut because they will charge $220 for the sink cut. I didn't even notice that. Well, that's
22:43 really clever. We eliminate the sink cut by using a piece of uh epoxy uh epoxy but block in
22:49 the back, mounting this to it. This is still waterproof because of the epoxy,
22:54 right? But [music] we eliminate the sink cut. So instantly we're $220 less expensive. One of the things that we
23:00 designed, the third thing we [music] did was we designed our our cabinet setup.
23:05 This is an upper cabinet. Yes. Okay. What we do is instead of using the
23:10 proper [music] type, you know, if you use like a regular sink, you're not going to be able to get a good 9-in deep sink. This is far more grand and
23:16 prettier than you're going to find in almost any other apartment build. Absolutely. But it's actually functional as well because we use an upper cabinet. That
23:23 upper cabinet costs, you know, $250, $275. Yeah. A typical sink that's going to a
23:29 typical sink basin that's going to catch this sink is going to cost about 800
23:34 bucks. So, we save $550 by choosing this setup instead [music] of using a normal
23:42 cabinet that's meant to take on a farmer's sink. Well, and the coolest thing about it is that it looks better than your
23:47 traditional setup. Looks much better. And they pay [music] less. This ends up this ends up being an
23:53 $800 granite job instead of a $1,600
23:59 granite job just because you broke it up a little bit. Instead of putting the the fridge
24:04 and the stove right next to each other and then having an 8ft span and then having to cut and then having this and having that, you're getting low yield
24:11 out of your slabs. We get super high yield out of our slabs. We literally had, you know, one piece left that was a
24:17 little bit bigger than this out of two [music] slabs. That's perfect. So, the entire granite bill for this job was under 4,000 bucks.
24:25 Weird tape is your take to um this is the setup that we have for the washerd
24:30 dryer. Yeah. So, washerd dryer we'll slide it underneath here and then TV [music] will mount here.
24:35 Now, does this house get treated with anything or retro block I always hear gets beat up like crazy? Uh yeah, for people that don't know how
24:41 to treat it, [music] you know, and then that's not the tenant side, that's the landlord side. So for us, we'll take
24:47 these things and this is [music] unfinished right now. Yes. When we're done, we'll put it we'll actually put it on saw horses and we'll
24:54 do what's called an epoxy pour. Mhm. And we'll just literally pour the epoxy on it. We'll we'll make sure we [music]
25:00 take care of the edges. We'll do a nice pour on this. The really cool thing is [music] if it gets scratched up, cut up,
25:06 you know, knocked up, whatever, doesn't matter. What we're able to do when you when you use a nice quality epoxy,
25:13 you can take a plumbers's torch to it, heat it up, and you can actually just and it'll just smooth it out right back. Yep.
25:18 Perfect. So there's you're not sanding it down, you're not treating it, you're not oiling it. It is a correct
25:24 effectively a [music] meltable plastic table. That looks beautiful. That's correct. And then these are the last two bedrooms here. I think this is
25:30 the smallest bedroom in the entire building, but it's still big enough for a king. You put the king right here and
25:36 it actually comes out to right about here on the floor. Yeah. What a cool project. Yeah, it was a [music] fun project.
25:42 Yeah. Took a long spell, sir. But yeah, we'll show you the last unit up here and then we'll go down and we'll show you
25:47 the ADA housing that we did. Oh, pretty cool. You thought of everything. I mean, we tried to every
25:55 every unit's a little bit different. Mhm. But washerd dryer piece goes right in there. That will be [music] a mega size
26:01 fridge. We'll go with a much bigger fridge there. Um, and then again, wall on this TV,
26:08 um, couch right here, and then this will be like a nice little breakfast enough. One thing that is really cool with this
26:13 building is that the design doesn't allow you to make [music] every space identical, but every space feels the same.
26:18 Yes. It it does it doesn't feel disjointed. It doesn't feel like, oh, this this unit is not better than the other units.
26:24 [music] Correct. You use the space really well, right? Yeah. pretty standard, [music]
26:29 you know, and again, this was a wide open space. The cool thing is, you know, everyone says, you know, it's got good
26:35 bones. Well, this is three layer. [music] This is three courses thick of brick walls.
26:41 Mhm. And then we have steel I beams is what the roof structure is. So, above this is
26:48 all your sprinklers and everything else. [music] We actually sprayed foam on the underc
26:53 carriage on the underside of the roof line. Yeah. Now, that's conditioned space up [music] there. We don't have to worry about
26:59 broken broken lines. We don't have to worry about anything freezing. We're 100% good because the ceiling is what we
27:05 [music] which in New Hampshire freezing is a thing. Freezing is a thing for at least 4 months out of the year.
27:12 The other cool thing that a lot of people don't think about is panels in unit. Yeah. So, a lot of people have like a master
27:18 panel. Certainly, that's a big thing with small Yeah. multif family. If you have it, then you [music] have to give tenants access to
27:24 it. You don't want them walking through a basement. You don't want no them and I we have we have certainly run into
27:30 that. Yes. So what we [music] focus on is we always put the panels in the unit. This
27:36 means that you can do VA. This means that you can do housing [music] choice voucher. More importantly, you just
27:42 don't ever have to give somebody access to a basement cuz if you give them access to a basement, go fix something, [music] they'll likely store down
27:48 there and then you're in then you have a problem. [music]
27:58 [music] And there's one unit on either side. Yep. Yeah. We did butcher block
28:03 throughout here. Yep. And will this all be done with the uh with the the certification? Is this also
28:10 within that 3 week period? Yeah. [music] So, we're Yeah, we're really close. Honestly, we're really
28:15 close on this. Yeah. There's not much to do. It's all finishing touches. It's all Exactly. pace. If you're watching this and you've never done a
28:21 rena project, this might look like some parts are like a construction site. This is all pretty much just cosmetic
28:28 and final touches. This is quick. Correct. [music] What's also really cool is from a fire perspective. They're in
28:33 bed here. Fire alarm goes off. They can literally roll over to this, [music]
28:38 pull this, push this up, and they can roll right outside and they're safe. Oh, that's really clever.
28:43 Yeah. Tell us [music] part of the is this is a good design idea or is it part of the actual required design for egress
28:49 on the that was me design I guess. Yes. [music] Oh, that's super cool. A great design. Thanks. Yeah.
28:55 Yep. Yep. They want [music] egress but we're like you know it's becomes very complicated when you start introducing
29:01 uh [music] physical challenges and so yeah just and then what's really cool is right here again they'll have uh here's
29:09 where their TV will go. There is couch and chair setup. Yes, [music] it seems a little bit narrow. I get it. But how
29:14 much space do you need? And again, the key for most of these guys is they're, you know, they're going from a pretty
29:20 lousy situation of, you know, sharing with a bunch of other people or living in a home where they only have a room.
29:26 You know, this is going to be unbelievably awesome. [music] It's going to really give guys their
29:31 life back because they're going to be able to roll out their front door. They have access to [music] handicap parking right outside the door and they also
29:36 have access to public transportation. What's Thank [music] you.
29:45 Just final touch of some paint and then a final clean. Upstairs has been all final clean. Um they just [music]
29:50 haven't gotten down to this stuff yet before the final clean. But yeah, all the construction is done. But Yep. Yeah,
29:56 just final touch of paint and then just just a clear out and then the final click plates on top of this.
30:02 I love the areas with the exposed [music] brick that you guys left. That's aesthetically super cool. Yeah, we exact. You know, we wanted to
30:07 leave it in some places but we didn't want to kind of overdo it. Yeah. Um, [music] but yeah, we've got the window, everything ready to pop into
30:14 this, but again, we left all this up because we wanted to do a grand reveal for everybody to see all at the [music] same time. And we kind of thought that
30:19 we're going to leave that open, too, cuz that's the 18-in I beam that you so [music] rarely see in construction, but
30:25 we think that's kind of cool. Kind of tells the story of the building. Yeah, I like it. [music]
30:31 So, the last but not least is the final piece, which is the bark.
30:37 So, we were negotiating the deal and putting it together and we asked that they give us the park and they said yes.
30:43 The long and we got to yes, [music] which was exciting. Um, but yeah, we you know, obviously for them it's the city
30:50 doesn't have to take care of it anymore. We take care of it. Yeah, that's awesome. Uh, there was a there were a couple trees in here that were in really bad
30:56 shape, so we had to take care of those. Took care of those trees. They we got the [music] granite benches. And then
31:01 what we'll actually do here to help business for not only for the indoor playground but also for the cold kitchen
31:07 is we'll actually create a big huge patio area here. One for customers and one for not customers. Oh that way the town can come by and
31:13 they can sit sit out here get some nice nice little park time. Um but most importantly we can get
31:19 give an advantage a strategic advantage to the restaurant and to the indoor play space because they'll be able to come
31:25 out here and grab food and sit here and eat either before or after playtime. Oh, amazing.
31:32 [music]
31:40 [music] Um, this tan one I own, I bought that
31:46 for $155,000. Um, bought that for 155K and it just
31:52 appraised for $450 and that was in 10 years. Wow. Yeah.
31:58 So, question on your final numbers for your prison. We just got a tour of the
32:04 prison. We're driving back right now. Uh, what was the acquisition price? $200,000.
32:09 $200,000, which is ridiculous. That's a lot of building and a lot of work. It is. Yep. Um, we covered this on our live, but for
32:16 those who haven't seen that, what was the original timeline and what is the final timeline for that project?
32:22 Uh, original timeline was uh 18 months, 12 to 18 months. Um, and it was about a
32:29 million dollar budget. Wow. And we ended up going about 32 months
32:37 and we ended up pro pretty close to probably
32:42 a million1. So we might be about 10% over budget.
32:48 But it's only because I actually know how to calculate properly. So I count our burn rate. So the project itself did
32:57 not go over pro over cost. The project itself we actually hit all of our numbers across the board. What cost us
33:04 that extra, you know, probably 80,000 bucks or so um was actually the the
33:10 extra holding. Yep. Which makes sense. Yeah. And and a 10% overage budget wise is not
33:16 crazy for a project that's as big as converting a prison into Yes. beautiful multif family. So a great
33:22 deal. Yeah. We were happy with that and like I said, I mean the biggest thing was just how long the project took. So the
33:28 biggest mistakes made with that, the biggest mistakes made there were the amount of time it took to get approval.
33:34 Um the [clears throat] amount of time that we waited around for two specific vendors. One of them was the fire
33:40 suppression company that got sold while we had the project and they spent months figuring out which end is up. Um and
33:47 then the last was the the plumbing vendor which was uh you know abysmal
33:54 performance to say the least. So uh we should have uh we we hire fast and we
34:01 fire faster, [music] but we should have fired a lot faster. We just kept on thinking it was going to get better.
34:06 Yeah. We kept on thinking it was going to get better. We had a contract. We had this, we had that. And every time you'd call them, they make excuses. We can do
34:12 this, we can do that, and no, let me take care of this for you. And when it was all said and done, it was just a bunch of empty promises. It was a bunch
34:18 of of lousy work. Um that [music] they could never actually deliver what they
34:24 said they were going to deliver. They were always behind. Then they would say things like, "Well, [music] we're, you
34:30 know, it's not just us. We're waiting for payment from you." I was like, "You're waiting for payment for a gate that hasn't been hit yet. You're going
34:35 to keep on waiting for payment. We're not going to give it to you because you haven't done the work yet." So people get very confused about sometimes very
34:42 simple things. Um but yeah, so after we fired them, we actually got the next plumber in and he's uh he finishes
34:49 Monday, which means start to finish. It was about 3 weeks from when he said he would uh start and finish. So we're now
34:57 clear of it. And so uh the more exciting thing is we have a great debt on the
35:02 building. Um it's still kind of pricey from the perspective of it's about 7 1/2 7 and 3/4. So we can refi. Uh we're
35:10 going to look at the numbers and see after we get it rented up. We're going to look and see what it we're actually going to be able to do and potentially
35:16 do a cash out on it because purchase price, project price, um we ate the
35:23 purchase price to basically say this is our down payment on the loan. So we only have a loan for about a million dollar.
35:30 Oh, that's fantastic. And [music] so we only and on top of that, it's about seven it's about an
35:37 $8,000 a month payment uh with taxes and insurance. Uh and so now we will be in
35:42 position to probably refy it. I believe that what we're [music] what we're projecting on rents uh based on what we
35:49 own in the market and what we see we think we can get there probably about 18 a month I think is possible. Um and if
35:58 we hit that 18 a month based on other valuations in the area you're probably talking about a $2 million building
36:04 which means that we probably in that time built about a million bucks worth of equity. Jeez. Well, well done. Well done.
36:11 Not bad. Makes you feel a lot better about the project taking a little longer. [laughter] You made it. I'll sign up for another one if the
36:16 numbers look exactly like that because my time is worth about that much. Oh, there you go. So, yeah. Good stuff.
36:21 Good stuff. [music] I think meeting with other people with
36:27 other strategies who have done the thing that you want to do yourself is the most important thing you can do. And I still practice that in my business all the
36:32 time. [music] I don't think any business owner plays a perfect game. So, learn from as many people as you possibly can,
36:38 which is the purpose of this channel. Matt is a lot farther [music] than me in real estate because I've been doing this
36:43 for five times as long. Looking at his portfolio is really fun. That project with the prison is one of my favorite
36:48 projects. It's really cool driving out to it though and passing all of the buildings and neighborhoods that he has
36:54 acquired over the last 20 to 25 years. It's really fun to see someone else who does the same aggressive investing uh
37:01 but in a different market. As you guys might have noticed, there's a lot more forplexes in New Hampshire than there are in the markets that I invest in. So,
37:07 he has a whole lot more residential on 30-year fixed rate debt. It's still a great strategy. There is no
37:12 oneizefits-all. My personal takeaways from this video, though, you can save so much on the efficiencies, the kitchen
37:19 design, the little [music] things that he does, the water sensors, choosing the right toilet with the right flow rate.
37:26 [music] It's the little things that go a long way. You save expenses for yourself or you save expenses to your tenants, which
37:32 ultimately allows you to get more profit with less rent, which means if you pass savings on to them, they stay longer,
37:39 which makes you more money. All of these are strategies that make for a better building and a more profitable [music]
37:45 business. So, I hope you got as many takeaways as I did. Uh, anytime I'm out with Matt, it's usually an hourong video
37:51 with lots [music] of stuff. So, I appreciate you guys getting to go along with me for the ride. Also, shout out to
37:57 my editing team uh for going through all of that because I just filmed [music] hours of footage with Matt and they put that all together. I dumped it all in
38:04 one file. It was like 27 videos [music] and they made this happen for us. So, uh shout out to Josh. Thank you for putting
38:10 that together for us. Um by the way, the book is officially out, the book on
38:16 creative real estate, and we just hit the Amazon bestseller list, which is super exciting. Uh so if you guys want a
38:22 copy of that, first of all, uh one person is going to get a free book based on uh their guess of the cost of match
38:28 renovation. [music] Uh but after that, this is available. There's a link in the description. Um I'd love for you guys to do that. That's
38:33 not just my deals, but almost everything in there are deals that I've done. The few examples that I have uh that are
38:40 from other people are from friends within [music] the multif family strategy mentorship and friends of this
38:45 channel. So, I go through actual deals uh that me or my friends have done in this book, the creative lessons that we
38:51 have learned, and we learned them just like we learned on today's [music] video by going out and actually doing the
38:57 thing. So, I hope you love the book. I hope you appreciate this video, and [music] I'll see you on the next episode.