Are you a “Turkey Investor”?

Are you a “Turkey Investor”?

8 min read
Chris Clothier

Chris Clothier began building his rental portfolio in 2003 as a successful entrepreneur looking to diversify his investments. He quickly gravitated toward passive investing, establishing a portfolio of over 50 single family homes in Memphis, Tenn. As an original client of his family’s firm Memphis Invest (now REI Nation), Chris experienced firsthand what a passive investor endures when purchasing out of state. In 2007, Chris moved his company and family back to Tennessee, wound down his brokering company, and joined REI Nation as a partner and director of sales and marketing.

Experience
Since joining REI Nation, the business has grown into the premier turnkey investment company in the country and a standard bearer for best practices in the industry, managing over 6,000 investment properties for 2,000 passive clients. In addition to managing the development and implementation of sales and marketing processes, Chris serves as an ambassador for the company, working with the team to help potential investors define their purpose for investing in real estate and educating peer companies on best practices.

REI Nation clients’ portfolios hold a value of close to $800 million in single family assets in seven cities. The company has been featured as a six-straight year honoree in Inc. magazine’s list of the 500/5,000 “Fastest Growing Companies in America.”

In 2019, Chris’ team assisted 600 investors with purchasing just under 1,000 fully-renovated and occupied turnkey homes. Chris led the re-brand of his family’s company on January 1, 2020, from Memphis Invest to REI Nation.

Chris is also an experienced real estate speaker and addresses small and large audiences of real estate investors and business professionals nationwide several times each year, including IMN single family conferences, the PM Grow property management conference, and the Ignite conference in Las Vegas each December.

Chris continues to hold a sizable single-family rental portfolio in both Tennessee and Texas. Along with his family, he owns several commercial buildings in the greater Memphis area.

When not working with the team at REI Nation, Chris is busy raising five kids, operating a racing company in Memphis, and serving as CEO for The Cancer Kickers Soccer Club, a Memphis-based 501c3 providing comfort and care for kids battling childhood cancers.

Founded in 2017 by Chris and Michelle Clothier, the non-profit organization focuses on providing a team environment for kids to find encouragement and strength in their battle. The company worked with over 500 children from six countries in 2019.

Press
Chris has been featured in stories published in Money Magazine, The New York Times, The Wall Street Journal, and DN News, as well as the Memphis Business Journal. In 2018, McGraw-Hill Publishing purchased Chris’ manuscript, The Turnkey Revolution, and worked with Chris to publish his first book in May 2018.

Chris also publishes two weekly blogs at ChrisClothier.com and REINation.com. Chris has also published articles on the BiggerPockets Blog since 2009.

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These last two months have been eye opening for me as a real estate investor.  On a not-so-serious note, I have learned some new terminology like “turkey person” and “turkey investor”.  On a serious note, I have gotten a first hand and up-close education on why I failed the first time around as an investor and how I never plan to fail again.

Learning To Maximizing My R.O.C.?

To help you get a clear picture of where this article is going and how I came about to write it, I want to tell you where I have been the last two months.  I have been to meet with multiple different community leaders, community action groups, neighborhood stabilization groups, job building organizations and to top it off I was able to participate in a Boys’ & Girls’ Club of Memphis “Youth of the Year’” competition.  I have been on a bit of a soul searching mission lately to really understand how I can get deeper involved in the growth of Memphis.  To be fair, I love this city.  But, I have felt a calling to get out of the shadows and take an active role in some pretty serious issues.

If you don’t know who Tony Hsieh is, I suggest you open another browser and Google his name.  You are going to find an overflow of stories about his latest venture in Las Vegas.  I urge you to not only read them, but read through the stories to get a sense of what Tony is really doing in Downtown Las Vegas.  I have known about Tony Hsieh for a couple of years and have felt my business world being slowly pulled closer to his.  I recently read a New York Times article on Tony and his group and it inspired me even more.

He may very well be showing all of us how to take urban and even neighborhood decay and rebuilding it from the inside out.  Ands I want you to take special notice that he is not doing it by throwing money at different groups or organizations and saying good luck.  Yes, he is committing his own money to the project.  But he is also committing his whole heart, soul and energy to the project and bringing a whole bunch of people who share his vision along for the ride.

He has an interesting approach to attracting business owners that decide to join up and help with the revitalization of downtown Las Vegas.  He tells them that every factory in the world is doing everything to maximize R.O.I. – return on investment.  He tells that he his project is doing everything to maximize R.O.C. – Return On Community!

This one line jumped out at me in the New York Times story and it really began to weave together for me what I had been experiencing.  As an investor, I was looking for a way to not just earn a return on my money by buying property.  I knew I would be satisfied going forward unless I was giving a return to the community as well.

How A 17-Year Old Kid Inspired Me

As a judge in the local Boys’ & Girls’ Club “Youth of the Year” competition, I had a chance to sit down and interview 5 different area teenagers who had won individual club nominations and then been selected as finalists.  The award gave them a chance to earn  a small financial prize and then go to the statewide competition.  I had no idea what I was about to experience and the phrase that was going to stick with me for the rest of my life.

The kids themselves were amazing in he way they carried themselves and presented their stories.  From one of the first deaf competitors in the history of the competition to kids’ from single-parent homes, these kids wanted to send a clear message that their personal struggles did not define them.  They wanted something better not only for themselves but for their friends, siblings and others in their communities.  They had no idea what each of us did as judges.

One by one I heard their stories of growing up in blighted neighborhoods, although not all of them had the same struggles.  Some of them dealt with the lack of transportation where they lived, others watched as homeowners moved into their neighborhoods but could not afford the home they bought and soon lost it to foreclosure.  One contestant in particular though really stood out to me as he talked about not only his neighborhood, but also the area of town that he lived.  He explained that he was lucky.  He lived close enough tot he Boys’ & Girls’ Club that he could go and spend his time after school at he club.  However, if the club were not there, he told us that he would have no where to go.  He described an area with no grocery stores near by.  No strip centers with a sandwich shop or an arcade or a convenience store to visit.  He described an area with no parks, no community centers, no community pool…nothing.  In his words, he described an area where the only place the kids had to go was the street corner and under the lamp post.  As he put it, nothing good happens on a street corner or under the lamp post.

Where he was describing is a very popular area of town for real estate investors.  For the parents, the problems he was describing were less severe because they had cars and the neighborhoods are near local jobs.  The things he was describing as missing had  all moved to high traffic intersections and neighborhoods had become more isolated.  When I asked him what he would like to see done he answered point blank that he would like to see someone invest in the area itself and not just buy up all the rental houses.  There it was.  A 17-year old kid just described R.O.C. better than anyone else could have.  It is not simply about the return you put in your pocket.  If you want to be truly successful, you have to have a return you put in your hear.  It is about the people.

Are You A “Turkey Investor”

When the judging interviews were over we had the honor of joining the kids for a lunch.  Again, my head was spinning a little bit because I had been searching for ways to get involved deeper in the community and I had just had a kid way to young to act and speak as old as you was, describe for me what he wanted as a resident of that community.  I didn’t feel shame at all for the way I had invested through the years.  I just immediately realized I would have had an easier road had I taken the time to invest in the people themselves.  Little did I know there was one more surprise coming.

On the way to the lunch that day I was driving down the highway towards downtown Memphis and glanced over to a neighborhood that had really been cut off by the rest of the city by the highway and the development of the city outward.  I distinctly remember driving through that area several years ago and thinking to myself that someone should really do something about this area.  It was rough and in need of some love.  I remember thinking I would like to do something, but I was scared beyond my wits to get out of the car.  That day, driving to the competition, I glanced over and thought to myself again “someone should do something about that neighborhood”.

At lunch, they brought in a guest speaker.  He was a man whose story I had heard before, but I was really not familiar with all the details.  His name was Bill Courtney and he as featured in the 2012 Oscar winning documentary “Undefeated”.  He stood to give a speech that lasted maybe 20 minutes and I don’t remember taking a breath after about 5 minutes in.  He was a volunteer high school football coach in an area of town that very few would volunteer for anything.  He described a neighborhood just off the highway that he and thousands of others drive past everyday on the highway.  He described his own feelings about that neighborhood and asked how often any of us glanced over at that neighborhood thinking that someone should do something about that.

“What the Hell is wrong with you” he asked as he stared at me in a room full of 50 people.  He didn’t mean to be starting at me.  It just happened that as he was addressing the crowd and I was in his line of sight at that very moment.  But it shook me up pretty good.  I had to ask myself the same question.  What the Hell is wrong with me?  Why not me?

He went on to describe the exact reason why I had never taken action before.  He told a story of one of his players helping him to get through to some other players on the team who were still struggling away from the football team.  He wanted to know why he had not been able to earn their trust yet.  One player clued him in on the problem.  He told the coach that the other players were just sizing him up and waiting to see if he was a “Turkey Person” or not.  After asking what that meant, he got his answer.  The “turkey person” is that person from the suburbs who shows up every Thanksgiving and Christmas with turkey, ham, canned goods and presents.

I was the guy who thought that giving a gift certificate when a renter closed a house, or giving a tenant a ham at Christmas was something special.  I thought I was making a difference and giving back.  Was I giving what I had, yes.  Was I giving what was needed, probably not.  I recognized in his recounting of what his player had told him, that not only was I a “turkey person”, I was a “turnkey investor”.

He told how the player said they were thankful and of course, they took the gifts, but they knew they would never see those people in this part of town on any of the other 363 days out of the year.  They knew this was the opportunity for the “turkey person” to pat themselves on the back for a good deed done and then go back home to the suburbs.  The other players were just waiting to see if the coach was really committed or not.

Are You Committed To Where You Buy Real Estate

I have to admit, I have never been fully committed to the neighborhoods where I have invested on an active basis.  Perhaps that is why I have not always been successful as an investor.  Perhaps that is why some of my investments failed.  I am becoming a true believer that as I am blessed with success, my real mission is to go back and try again.  Only this time as a smarter investor.  This time, I don’t need to be that investor that wants to show up once a year – a “Turkey Investor” – but, I need to be more committed to the neighborhood and look to invest in ways that the community needs.  I have learned to slow down, which as been hard and rather than act on my own, I wan to act in conjunction with others to have a real impact.

Perhaps, it is time to put a personal saying that I love to the ultimate test.  My father has always attributed our business success to helping others.  He has always said that if you help enough others get what they want in life, you can have anything you want in life.  The thought that has filled my mind over the past few weeks has been that as an investor, I am called to do so much more than simply identify my best returns.  I can do that every single day.  Believe me, when you have enough experience, both good and bad, you learn to evaluate better!  The thought that drives me to write this article is what if we all focused on R.O.C. first?  How much better could our R.O.I. be?

What do you think?
Photo: LaurenKates