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118
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86
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JS Burnett
  • Real Estate Consultant
  • Houston TX
86
Votes |
118
Posts

Leverage (they mean loan, and those are okay)

JS Burnett
  • Real Estate Consultant
  • Houston TX
Posted

They mean the loan. They always mean the loan.

Fine. The loan matters. Use it. But I've watched men with perfect capital stacks work themselves into early graves babysitting projects that should have run without them. Impressive debt ratios. Miserable lives. Small portfolios dressed up in expensive language.

The actual lever, the one worth pulling, is time. Specifically, other people's.

You hire the entitlement team before you need them. You put a real Director of Development in place and you let them direct. You build a capital network once, maintain it quietly, and stop re-introducing yourself every raise. You do this not because some conference speaker told you to work smarter, but because you eventually do the math and realize you've been doing $50-an-hour work inside a business that should be writing you $500,000 checks.

When the team is right and the structure holds, something strange happens. The five-year ground-up deal, the one everyone calls risky because the timeline is long, becomes the most peaceful thing in your portfolio. The basis is locked. The capital is committed. The machine runs. You go find the next site.

That's how you end up building the 300-unit project instead of the 30-unit project. Not because you worked harder. Because you finally stopped.

The loan gets you in the deal. The time gets you out of the weeds. And out of the weeds is where the real buildings get built.

The trick is to find a team that you can prove your loyalty and intent.

Need an introduction?