We would like to extend a warm welcome to Preston Walls, CEO of Walls Property Group, who is our guest for today’s show. Preston grew up in Seattle and learned the real estate game from his father who was a property developer. Once his dad retired in 2008, Preston went at it alone and now his portfolio consists of 70 multifamily buildings valued at over 300 million dollars! Preston talks to us today about why he loves self-managing multifamily properties in the Seattle market. He also shares some of his strategies for finding and adding value to deals in his town.
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Preston has put his blood, sweat, and tears into learning his hometown market which has strict construction laws and is also highly dense. This makes it a tough space to work in but also one that presents high yields to those with an in-depth understanding of it. The creative strategies that he uses to add value to such a dense market are fascinating, as are some of his ideas about being fully vertically integrated. While most owners/syndicators prefer to outsource management to third party companies, Preston loves doing it with his teams. He gets into the many benefits that he sees in using this method. After explaining why multifamily keeps him from worrying about the downturn, Preston shares a community project that hasn’t been spoken about on this show before, so be sure tune in for this one!
Key Points From This Episode:
- Preston’s journey learning real estate in Seattle from his developer father.
- The strategies Preston used to get to owning 300 million dollars in multifamily apartments.
- Preston uses densification techniques to create affordability in the Seattle market.
- Why Prestons stays in the Seattle market: its impenetrability and rent growth rates.
- The benefits of staying in one market: exploiting detailed knowledge about it.
- Preston’s strategy for finding his buildings: listed properties and broker relations.
- The terms Preston offers: all cash, 45-60 day closes, and more.
- How goodwill plays into Preston winning deals from brokers.
- Various ways Preston buys property, such as syndicating and in his own capacity.
- The ideal property Preston looks for: five to 50-unit value-add apartments.
- Different teams Preston works with, such as management and operations teams.
- The benefits of vertically integrating as far as insight and lease-ups go.
- How Preston got into self-management through an organic process.
- Where Preston sees his business in five years.
- Ways that Preston has improved investor relations through hiring staff and a reporting portal.
- Preston uses monthly reports and Instagram pages to regulate investor communication.
- The hardest part about syndication for Preston: investor relations.
- When Preston will sell while otherwise holding properties.
- What makes holding a good choice in Seattle: construction permit laws.
- How investors make their money back from Preston through his refinancing strategies.
- Preston has used technology to improve his business: digitization, Instagram, and more.
- Diverse assets and the multifamily game keeps Preston from worrying about the downturn.
- How Preston cares for investors and what has made him successful.
- The essay competition that Preston hosts to give back to the community.
[bctt tweet=”The Seattle market is dense and it’s growing, and like many markets, affordability is a challenging topic so one way that we’ve been able to address and create affordability is by creating more dense spaces. — Preston Walls” username=”whitney_sewell”]
Links Mentioned in Today’s Episode:
About Preston Walls
In his executive career, Preston has held leadership positions at Walls Property Group as Founder and CEO for over 7 years, and almost that long as founder and CEO at Walls Property Management. He is currently managing a portfolio of 70 buildings valued at over $300 million. Preston directed a ground-up, 42-unit Built Green Class A Mixed-Use project, including planning, permitting, tenant relocation, demolition, construction, leasing, and financing. He is currently building a 61-unit mid-rise multifamily project, in permit for a 59-unit site, and renovating several existing value-add properties in Seattle. Preston has managed syndication projects requiring additional equity capital and raising capital, negotiating terms and partnership agreements, partitioning risk, and managing equity and debt offerings to investors. He has also served as the project manager for dozens of building renovations. Preston obtained a B.A. with a double major in Economics and English from Colgate University. He has served on boards and advisory councils, including Discovery Montessori and Lakeside School. In his free time, Preston can be found fishing, boating, wake surfing, skiing, and spending time with his two children. Preston also enjoys volunteering with his favorite charity, The Goodtimes Project – whose vision is to create caring spaces for families who have been affected by childhood cancer.
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