my goal is to get Brandon to do this for the next two years on his nights and weekends. But I think you have to start with a bachelor's degree. My man. Yeah that's what I was saying. I'm not sure they're going to take Brandon but since you're a business owner I think they will. What I gathered the interview. Yeah. What I what I've gathered in some of those requirements is if if you're a successful professional in the field of study already, typically you're going to get in uh even without an undergrad. But if you're like a graduate student and you've done nothing in your life, they're gonna want you to take a G. R. E. Or something just to prove that you know what you're talking about. Alright guys welcome back to another episode of how to invest in commercial real estate. I'm super excited today. Uh A longtime family friend of mine is in town. His name is john bounder. He's also a successful investor of both precision equity and the criterion fund. He's right off camera here. The coolest thing about my friend is he flies uh marine one for the president which I think is one of the most awesome jobs you could have but he's retiring and he's starting to get more full time into investing in real estate.
And a buddy of his. We have today is Benjamin Meyers. Uh you're just outside of the D. C. Area in lancaster pennsylvania and he runs Eberly Myers it's a construction company, urban walkable development uh they focus on really transitioning older buildings into really cool lifestyle, multifamily. And we thought since he was in town with my friend john that we have Mon and talk about his story and how he got into commercial real estate. Welcome Benjamin to the show. So the first thing I'd like for you to tell us because you are running this company is just give us a little bit of a background of you weren't in real estate. I believe you said you had an art degree and we're doing photojournalism at the White House, which is super cool in itself. But how did you then transition into real estate? Because a lot of our listeners loved to learn how they might get in and hearing other people's stories can give them some inspiration. Yeah. So uh, just the five second version is, I was on capitol hill in the White House for about eight years. Um, and um not thrilled with sort of the political environment I felt at the end of the day, my energy was zapped more than more often than not um, beyond the work component of it.
And so I went back to the thing that I uh kind of grew up around which is construction always sort of swinging a hammer getting involved in different things. And I had an opportunity to work for a regional national company pulte homes that has a mid atlantic, multi family division and effectively they have a good training program and people skills, they have some other metrics that uh they value um a lot of their clientele are generals and different people that they build townhouses, condos or whatever in the northern Virginia metro area, D. C. Metro area. So I got an opportunity to work there for a number of years and was just a really great education in project management and uh scale. We would have three or four buildings going on at once at different levels. One would be moving dirt, one would be framing, one would be uh taken it to finish and one would be handing off the the units to customers to uh whoever the end user was, which is typically a condo.
So great experience. And they kind of helped facilitate my further education. I got a master's in real estate development in uh George mason which is an excellent program. I love that. I want to ask about that because I've looked into getting a master's in real estate or master real estate development several times. Never pulled the trigger. Uh you know kind of throughout my real estate career. So uh tell us like did that provide you the keys, Is it something that you would recommend people do if if they see a long term vision to get to getting into commercial real estate. Yeah, it's it's probably the thing that gave me the confidence to believe that I can do that. I understand what the risks were. So I I viewed George mason's degree, The m red program as they refer to it as a dirt degree. Which is effectively it teaches you soup to nuts, how to find property, how to analyze it, um How to secure on and off market deals, how to understand the legal aspects, real estate law and where the pitfalls are and what are the terminology that you want to make sure that our in each deal too to prevent reduce your risk.
Did you look at other universities to see if they had that or it was just convenient for you and they happen to have it or? Yeah look too and I can't find that many of those. There are not that many. I don't know about this, about this area. This region in D. C. American University has a program Georgetown University or they have a program mason has a program john Hopkins, there's about four or five schools and they do and they do an annual inter school competition where a property owner is trying to figure out what to do with their property. And so it's an actual case study and I got selected to be a part of that team. We presented in one, we won a $10,000 which is kind of cool. We brought a lease for Harris teeter which is like a 75,000 square foot lease with 400. Uh Yeah but yeah they were like they actually executed on the number of elements of our plan and the schools also get access to. An architect to builder uh accounting firms to put together the model and the presentation.
So each school has awesome awesome program. But the factor the thing that made it valuable intrinsically valuable for that program, mason's program is the educators themselves practice their profession. So my finance professor worked for B. F. Saul massive company in northern Virginia. They own millions of square feet. They develop their renovation budgets are in the hundreds of millions on class A assets in D. C. Proper. So they're not just professors and their numbers are we're going to work on 100 and $50 million analysis. I want you to build a spreadsheet that covers waterfall investments and all this kind of stuff way more than a P. In getting started would need. And that's so how long is the program? Um It's a two year. You can you can go through it in two years uh in the evenings. Yeah it's geared towards working professionals.
No it's really good. I think there's so many people out there that want to do things in life, not just real estate. Uh And they're just sitting around not taking action. And it's either because they don't know what action to take or they're afraid. And knowledge is the tool that will combat that fear or that will give you the confidence to move ahead and take an action. But most people don't really spend all the time getting the knowledge. Uh So this is a great example how you got first class top grade knowledge on the area that you wanted to be in. I can tell you from experience to its way probably way easier, at least from my learning style. I I deal, I learned way easier when somebody's teaching it to me and I can ask questions. I was just watching hours and hours of like how to fill out an artist model and you watch enough of those and you can kind of get enough of the basis points to use it. But anyway, that's I mean that's that's a dense degree. So the thing that also is pretty as equally as valuable as the educators was was who I was in class with. So you had attorneys that are wanting to understand the development process to better serve their clients.
You have real estate brokers, you have builders, you have, so your t your classmates are when you partner up on a team, you're like, oh that's cool, hey come walk a project with me that's down here working on X. Y or Z. Or I got. Anyway, it's just a it's a really, it was a great experience and it's hard to compare with other schools because I don't have the practical experience, but education was empowering for me. Um Both the transition from construction management into development, which is not normally comes from the finance side of things. You get an M. B. A. And then you get hired by uh C. B. R. E. Or some read or something like that to help run analytics on on a big deal or deals. Um So it helped me get into development. It also helped me get into um the higher ed space is sort of a unique space that I got my next job after working. Construction management was working for a company called B. And D.
Brailsford and Dunleavy. It's a D. C. Based sort of owners rep organization. Uh They rep universities Higher Ed K. 12. They rep municipalities, they represent the school's out in san Francisco. They represent D. C. Metro schools and for those that are listening they don't know what an owner's rep is and you're gonna correct me I'm sure. But uh schools or even beginners, laymen, they go into higher G. C. And the owners protects the owner's interest and make sure they don't get screwed by the G. C. And make sure the project goes flawlessly or tries to. Yeah that's that's exactly right. So you have highly educated people running an institution that are trying to make educated decisions and good decisions on an area of in the world that they know little about. So you're a translator or a broker. So the construction team whatever comes back with a change order and you see well these were unforeseen circumstances and there's gonna be an increase uh cost of half a million dollars for X.
For site work. Well higher ed is gonna say hey you're trying to fleece me. What explain Like I want a third party to verify that this is a reasonable request. Um Or whatever the number is in that it goes both ways because a lot of times the G. C. Will what they want support like you're the media very right there. They need to translate it to communicate effectively with the ownership team which is the university or the school. Uh And the school is okay with an owner's rep then to write because it helps them. Yeah it helps them it makes the conversation much more clean and it makes the because everyone's being mean to you and then your nice back to the. Yeah yeah. Yeah that's right. They both complain. They both complainin. And you manage the complaints and try to the easier the more smooth it goes the better it is for all parties. So you just absorb and try to communicate in a way that's effective. Yeah and so we're using an owner's rep on our we're trying to do a development here in Tulsa.
It's going slow but we we ended up doing that and and the reason I went and tried to get an owner's rep is because the person I was working with. I we weren't speaking the same language and I and I wanted to make sure my interests are being protected and that's why I went out and got it um Okay quick quick question about the masters uh what what did you have to take a test to get included in that or because you're already working professional they just admitted you. Um So in the at the masters level it depends on the school. I didn't take a G. R. E. Or G. Matt, I didn't take a test but I did come with several letters of recommendation and I had an intake interview. And um it's it's about salesmanship right? Uh They're looking from their perspective they're trying to grow a program and it helps to have people from different backgrounds. I'm sure I was a wild card to them because if you're looking at an attorney that's done real estate law for like 10 years, 15 years and they're getting a degree it's easy it's an easy explanation. I had an eight year window where I was doing photojournalism and they're like uh is this like a hobby of yours?
What do you mean? What what's your interest here? What's your what's your endgame? So it takes some salesmanship. But my goal is to get Brandon to do this for the next two years on his nights and weekends. But I think you have to start with a bachelor's degree man. Yeah that's what I was saying. I'm not sure they're gonna take Brandon but since you're a business owner I think they will. What I gathered the interview. Yeah What I what I've gathered in some of those requirements is if if you're a successful professional in the field of study already, typically you're going to get in uh even without an undergrad, but if you're like a graduate student and you've done nothing in your life, they're gonna want you to take a G. R. E. Or something just to prove that you know what you're talking about. Well anyway that that's the side now and we'll see if you can get in, we finished the masters in um real estate development. So I guess bridged the gap from education and the confidence that you got from the education which by the way we preach all the time right of of how to read the books, talk to the people go to the conference is being the room immerse yourself in the education. I'm glad to hear that it's a re occurring theme from somebody who wasn't in real estate too.
Now real estate development owner, bridge the gap for me between education and you guys starting this company and deciding we're going to urban walkable multi family because that's a cool little niche there. Yeah. Yeah it's uh so the it kind of comes down to this when when you're helping facilitate. So a lot of this is good communication right? A developer is basically the cog of the wheel that everyone's looking for direction from. So you're dealing with a land use attorney, you're dealing with an architect, an engineer. Uh, you're dealing with the property owner, you're dealing with investors, you're dealing with all these people. They're looking for somebody to be transparent and honest to communicate effectively and to help under, help them from the beginning to understand their risks, navigate the risks and through the performance, whether it's better or worse or as as you target. So good communication is, is highly key. And that actually is a trans transition from working as a photojournalist. I photographed, I don't know, maybe north of 60 official portraits for members of Congress and state of the unions.
Uh, there are a bunch of things like that that I, that I did, um, inauguration, things like that. But you learn to deal with highly high professional people that expect a certain level of respect or candor or maybe just even give them the honor of giving them space to talk. Um, so that trans transition transition for me was super helpful in dealing with higher ed because those folks are also highly educated. They have a tremendous amount of value and they've worked really hard to get where they're at and so communicating effectively without being condescending or without is just a key piece. So in the higher ed, higher ed process, you're dealing, you're communicating to the builder to the development team and you're communicating to the educator and it's a lot of work. I mean you're trying to pull someone through a process that they may get or they may not. Um, and they may have other interests that there, they may have a way of doing business if you will, that's either more hard nosed.
No, we're gonna draw the line here, we're gonna really push back on this and you're trying to find, but this is a reasonable request. You're always playing middleman. The I have been buying singles, doubles, little quad quad plex is whatever with my brother at the time for the, for 56 years. And we were like, well, what do we have that? Maybe we should do something with one of these things trying to hold on to them or flipping them or just whatever we are intrinsically we're cash flow guys. So I want to build, I wanna build a business that I can pass on to my kids That will help sustain my retirement. I hope that I never have to draw on my 401K. I want that to build and just hand that off my assets. I want to be able to help educate my kids, my daughter and my son and who right now it's only two of them. Um, I want wealth preservation and value creation for my kids and help them understand how to build something for the long term.
So I'm not, I'm not a flipper, although the market these days are kind of, if I, we've owned some things for a while now and it's like, man what I accept three times what I paid for it. I don't know that's pretty compelling. Um so the long and short of it is it's, it's, we were trying to find ways of creating value with assets we had and when I started looking at the zoning of of one property in particular, I realized there was like an aha moment for me where I realized that the market place was communicating and understanding value of the asset itself. I have a four unit building. It produces $50,000 a year. Then the N. O. I. Is 35,000 whatever the number is and you take a cap rate on that and you got yourself a value and I can buy that. I can go and buy a seven cap maybe.
Now it's six cap or 6.5 cap or five cap depending on the location, I can buy that, what the owners typically don't understand is what the capability of the site is. So we didn't, when we bought this little four unit, my brothers, like I got a four unit with a mobile home in the back, it's a 14.5 1000 square foot lot. So mentally you put that, that's just the size of a single family house, right? Yeah, 3rd of an acre. But it's in a zoning that's in an urban cord district of a small tertiary town to Lancaster. So it's 9000 and change people in the town and there along the river, they're in between Lancaster and york. And there are some big economic indicators in the area. GlaxoSmithKline, which is a multi billion dollar pharmaceutical, has a headquarters five miles up the road, Turkey Hill, their headquarters is two miles up the road. Um the average income in a five and 10 mile radius might have been 100 and 20,000 in relatively rural lancaster pennsylvania.
And you're like, oh my goodness, well why is this town not growing? And it's the Because a bunch of housing. Yes, right, that's exactly it. And the when people live in an area for a long time, it's really hard to get past what, you know what you believe to be true when you made up your mind 10 years ago. 15 years ago. So as an outsider, I got trained to see what the capability of the site is and I realized there is a massive delta between the capability of this site and what we bought it for and what I can buy a whole lot of other properties for. And I referred to it as unutilized density. So I was like, man, if I had a million dollars now, I could I could buy three or four properties And I could probably create 20 million out of this and the development process is not short undetermined amount of time, depending on what you're trying to do, but if you're buying, if you're trying to develop outcomes within the zoning use that it's already allowed by.
Right? So I'm not changing the zone. I'm just submitting permits and going through the historic commission and the planning commission and all the folks that I need, I can find an architect, I can find an engineer and I can put a plan in place and the municipality, whether they want it there or not, they've already laid the roadmap through the ordinance zoning, what they want to see happen. That's what the ordinance is. It's a roadmap for where they want to see investment. So I looked at that and I'm like, oh my goodness! So I took a four unit with a mobile home and we're bringing the market. That asset that we built 33 units On a 3rd of an acre, Four stories with parking partially sub grade at grade, I should say commercial in the front, three levels of 11 per per per floor partial parking. And then open parking in the back with views of the Susquehanna River. Well I have another one that will is much much much smaller than that and gets like greater density.
Um But effectively I'm building something for under $6 million 632, of gross revenue distributable between 250 and 300, that's maybe at a 5.5 cap that might be close to an 8 to $9 million asset in a 9000 population 9 to 10,000. Uh That is in a small community and there is a 37 unit going on right up the road now there is a hotel, a historic building being converted to a branded hotel on the same block. And I now am pursuing an option on an industrial site that the town wants to. The town desires to change the zone. The current owner doesn't want to. But the zone that it would change to allows me to do exactly what I did there. But it allows me I can buy a property, I can over pay for an industrial site that's 40,000 square foot $2.5 million.
And then within six months and maybe $50,000 I will have changed the option to buy a $2.5 million property into an $8 million value because I can build 600 to 1000 units by right, So that's the triage of value right there and it's in a better location with better proximity to the river than my property. So my little 35 unit is setting the market on comp because concerts super hard when no one nothing has been built in 40 years. And I'm now saying thank you for the comp, let's go ahead and build the 1st 200 unit and then the next 200 unit and then the next 200 unit and give me free, it's not free, there's work and some education behind it, but give me some value value bump right out of the gate or I could sell them sell, sell the plan, I love it. It's coming from the same community or they're moving from outside community. So Lancaster County has 600, roughly 600,000 people York has roughly 450,000 people.
And this is right between both of them and the market is highly underserved market to serve that. Yeah, I want to go just kind of recap on some of the themes um that we we do every week but one is education. Um I love the example that matches real estate because I've I've looked at it brian's looked at it and um we're always talking read books and talk to experts, but this is a step outside that box that people should consider. Um And and once again that that knowledge, it combats the fear and that fear. Once you combat the fear and you overcome the fear you're gonna move past inaction to action. Um but I can't think of another two points. It's it's also really nice because it's um a comparable to a working professional, right? I mean you said a lot of those are night programs, so it's it helps the transition, you know, from a full time job to. Yeah, the second, the second thing I I think I wanted to say was we've had guest after guest come in and the key to their success was looking at a property and envisioning something different than it was.
You know, you could buy real estate and make money all day long with with exactly the way it's, you know the four plex was making money. You bought it, it's probably making an 8 10 12% return. But just like we have my friend on the other day that owns the furniture store where he's buying these houses with land carving the land off selling the house and now it has buildable land and the house is still selling for the same amount and lands free or if it's us buying the Vegas deal and and looking at the parking lot and saying this quarter of an acre, this half an acre. Put put a copy, I switched it on you, it was an acre before it's a quarter acre pretty soon it'll be like 5000 ft. But we sold that for over $1 million dollars and it was a parking lot that the previous two or three owners could have done the same thing and they didn't because they weren't looking at it that way we're Doing that same thing. Yeah. And we're selling them for 585. We power washed the buildings. Yeah, it's just crazy. And now I love what you're doing, you're you're now getting in an urban setting with high dense uh you know, flexible type space and saying, we can build up and your your master's degree gave you a lot of the keys to be able to do that and see it.
Yeah, so there's a, this is the synthesis of how I look at real estate is different then the way a lot of people look at real estate and I don't it's not intrinsically me, it's just the method at which I can find, I can sniff out the value And that is to reverse engineer. So I know that one of the, if I'm looking at changing the zoning, I'm gonna take it from industrial to uh multi family or commercial or whatever the change in use is gonna be, or a farm to a to a townhouse community. I know that it's gonna take me about 12 to 15 months, generally speaking. Now, maybe there's enough meat on that bone, That that makes a ton of sense. But it's also, I have, I'm relying on the good graces of the municipality to do that, and I might get community people that don't quite have the same understanding of what the needs of the community are.
They might show up at your meeting and they combat you and call you names and say your money grubber and all that kind of stuff. There's been big, massive projects that looked really cool, that's been turned down recently because it's against a very affluent part of town and those people, you know, get ahold of their local people to get the project and shut it down. So. And of course you're dealing with that. Like you said before we got on the show, Lancaster is one of the oldest in town cities in America. Yeah. So there's a lot of old buildings that people don't want torn down. So the chain, the flipped script, if you will on how to reduce as a developer, your objective is to manage risk. You're trying to manage entitlement risk and market risk and financing risk and all of these other things and I don't, there's a lot of risk. Yeah. And if you do it right, the rewards are very healthy and in proportion to the risk. Um, I don't look at rezoning unless I am very confident that I can achieve it, that I already know the community members or I feel like there's a way that it will be well received and my dollar amount an option on this land is super low.
So my risk is low and I'm willing to take that risk because I'm working on other deals. Every deal takes so long. You're working on a couple at a time. So you don't even get it in contract just to clarify you buy an option, I secure an option, I say, hey, I really like your property. Would you ever consider selling? And you say, yeah, I'd sell it to you for $2.5 million thinking it's gonna scare me off and I'm like sounds like a great idea. He's like oh my goodness this guy's gonna give me $2.5 million. Sign this paper saying I'll give you 15 1000 this year. 25 the next year and 25 the next year. Nonrefundable hard. As soon as you get the money that's yours to keep, I'll still honor the $2.5 million purchase price. But I have three years to get it through the entitlement process. And my risk is 50 $65,000. If it takes me through 2.5 years And it's gonna cost me 15,000 for conceptual architectural and a concept plan for for my site plan. And I can get my attorney to change the zone conditional on my purchase. So all of that my risk in it is $75,000.
And my upside goes from 2.5 to 8 million. That's a risk worth taking. But I typically and I'm gonna pursue deals that have that much meat on the bone. But the truth is if I know that I want to do what I I start with the outcome I want multi family urban walkable in in parts of town that I believe are in the path of progress, one street over from the good. So I buy in in the area that I can get real value and then I redevelop it and change where the line is and now I'm in the good part of town and then you go one street over and one street over. So I love that you change where the line is. That's gonna be the outtake. I love it. We're gonna have to wrap it up, so, so interesting. Um and it's even got my mind thinking and even with the option to purchase it, takes me back to Carleton sheets and Russ, Whitney and some of these guys, early eighties that we're talking about, all the creative ways to get a hold of real estate to get control of it.
So this has been super informative. Benjamin Meyers, Eberly Myers out of what would you say you guys, what's it to you out of? You have a website we can direct them to. We do Eberly Myers dot com. Alright, well hopefully we'll have some people look you guys up and just to get familiar with what you're doing. Thanks for joining us on the podcast guys like and subscribe. If you have a note to send us, send us a message. If you have a topic you want us to discuss, Let us know until next time. Thanks again. Alright, that was