E72: What are Triple Net Lease Investments and Why Investors Are Pivoting

AIME Episode 72 Transcript

Sarah Florer (00:19.071)
Welcome everyone to Alt Investing Made Easy. Today we have a new colleague and friend we met through Provisors, Joseph Goslin. He's the founder of the Eureka Business Group, which is based up in DFW. Thanks for joining us today, Joseph. We're glad to have you.

Joseph Gozlan (00:34.89)
I'm happy to be here.

Roland Wiederaenders (00:36.729)
Yeah, thanks so much, Joseph. You're a commercial real estate expert in the DFW area. And Sarah and I really like to make friends with commercial real estate people because you're aware of deals going on. You're aware, you know, who are out looking for deals. And we help people put together these real estate deals, both with the acquisition and then also to help.

put together a private securities offering to finance the acquisition. So you're a valuable new friend to us and we've liked getting to know you so far. And Joseph, just maybe tell us a little bit about yourself and your background.

Joseph Gozlan (01:17.07)
Yeah, absolutely. So Eureka Business Group is our business. It's a commercial listed broker. We started the company in 2008. We used to do single family for investors and duplexes and small stuff. In 2015, we started graduating to commercial, if you want to call it, and started doing multifamily. We not only brokered, but we also syndicated a few of them. We were on the GP side.

And then at the end of 2022, we kind of saw the writing on the wall, decided to kind of tell all of our investors and ourselves, it's like it's time to get out of multifamily and shift. So we also shifted our brokerage into retail and industrial, mainly retail focus. That's what we do today. We are a full service shop. So we'll do anything from investment sales to tenant and landlord representation. And we also have a commercial property management. So we deal with that too.

Sarah Florer (02:13.685)
That's really cool. I think it's really interesting, and we talked about it before, the shift that you made from being a multifamily into something different. we talked about your analysis of the data. So maybe we could talk about that a little bit more. But also, that tracks with something we talk about on our webcast all the time, which is this process of wealth building and the democratization of capital, how our framework here in the United States permits people to start in one place and pivot kind of.

in a new place and go advance and graduate into the next level, as you will. And think you sounds like you've done this. So I think it would be really fitting to hear from you a little bit more about that.

Joseph Gozlan (02:54.35)
Yeah, so, you know, we're all smart in hindsight in 2020, right? But I keep telling people, if I knew back in 2009 what I know today, I would have been a billionaire by now. So it's kind of like we all have to get to that knowledge when we get to that knowledge. Sometimes it's because we come across an investor and we had a conversation. Sometimes it's because we read something online, watched the YouTube video.

Sarah Florer (02:59.772)
Hehehehe

Joseph Gozlan (03:23.374)
When we started in 2007 and 2008, it's kind of, there was no YouTube that was that prevalent like we have today. Today, you go to YouTube and you can find anything you want, right? So that's really where we didn't know what we didn't know back then. And as we started getting more experience in real estate and got more exposure to investors, because we've never been, even when we did residential, we've never been your home buying broker. We've always been your investor's broker, right? Because it started as...

Sarah Florer (03:33.503)
Mm-hmm.

Sarah Florer (03:37.995)
Hmm.

Sarah Florer (03:48.075)
Hmm.

Joseph Gozlan (03:52.288)
investment for ourselves. And then we had friends and family said, hey, well, I want to invest too. So that's what we got into the brokerage on the investment side. And then as you get more exposure to more people, you start learning about the different things. So would I start in residential if I knew what I know today? Probably not. I would try to get straight into commercial. But it took us a while to gain that knowledge and get to where we had to be in order to make that move.

Sarah Florer (04:11.819)
Mm-mm. Mm.

Roland Wiederaenders (04:21.956)
And I think conceptually, the multifamily, was good. Some of the networks that I work for, the people that I've made contacts through, they started out just like you and the residential and then just saw what you can do is just combine many residential properties into the multifamily. It's really just stacking houses on top of it, little houses, an apartment complex, a multifamily complex. And so it allowed people to...

to get into it, but then like you, you saw the writing on the wall and knew you had to pivot and there's been a shift in the marketplace and so now it would be interesting, you said retail and we had further conversation about kind of what your area of focus is, but tell us a little about the properties that you really like to focus on.

Joseph Gozlan (05:15.266)
Yeah, just to touch on a point you mentioned, it's kind like when we started in 07, 08, the multifamily in the commercial was a big boys club. And then Regulation D came along the way and kind of opened the back door for the normal human beings like you and I to enter that big boys club. And now syndication became an option. It wasn't an option before that. If you didn't have a few millions of dollars in cash, you were not buying an apartment complex. So that's really what helped us.

get into that world and helped a lot of people get into that world. And then in 2022, what we've noticed is, and we've owned hundreds of apartment units at that point and we're managing even more than that, and we noticed that rents have gone flat. And some markets around the country, it actually went negative in 2022. At the same time, ever since COVID hit, all of our expenses went crazy high.

So, you know, everybody was talking about CPI being four, five, six percent. I think that was the top around six percent. And, that's great. But CPI has cheese in it. And I don't use cheese for my apartment building, right? I use lumber and I use concrete and I use rebar and I use paint and sheetrock. And all of these went up 40, 50 percent, not six percent. So, we were at the point where we've seen

an inverse of the graph. So 2012 to 2022, what we've seen is rent was growing a lot faster than our expense rate. And so we always had that positive gap between your expense ratio and your income ratio and that was great. It means even if you did a mistake, even if you overpaid, even if you were not super efficient, the market kind of corrected that. But starting 2022, it got a lot harder.

because those graphs inverted. Our expenses since 2020 were growing a lot faster than our income and then our income took a turn and started flattening or even going down, which means that every month that gap increases instead of decrease. You could have a 100-unit beautiful Class A property fully stabilized, 100 % occupied, and you're still losing value year over year because of that shrinking gap or expanding gap, expenses going faster.

Sarah Florer (07:37.376)
Yeah.

Joseph Gozlan (07:39.234)
That was enough for us to get out.

Sarah Florer (07:40.811)
No, I think you're articulating it really well because, Roland, haven't we heard different versions of a similar assessment? some people, but one thing I like about the way you talk about this, Joseph, is that you're very articulate about it. And to you and people in commercial real estate, it may seem simple, but to people that are outside, you know, it's really useful, think, especially to people who are interested in getting into all of this, which was part of our target audience is,

you know, education and information is power, right? And information grows stale. So some of those YouTube videos out there were made in the high heyday, right? And so you need to be careful also because it's not the same metrics anymore. Some of it's common sense, right? But I do think that point about inflation is really important because so much goes into...

the real experience a person has in daily life of what costs what, and you know what's increased, right? And businesses have complained about this, and the whole industry is impacted by it. But tell us now, mean, so it all makes sense about why you changed, you moved from multifamily. So what's the play then? So retail is one part of it, and I think you said flux industrial, or is another part of it? And those are kind of two different asset classes also.

Joseph Gozlan (08:41.262)
Yeah.

Joseph Gozlan (09:03.79)
not for an investor perspective, right? So the way we look at it is we're looking for triple net leases. And for the, if you have an audience that haven't heard that term before, a triple net lease basically means that the tenant reimburses the landlord for three things, triple net, that's NNN, right? The first thing is your property taxes. The second thing is your property insurance. And the third thing is common area maintenance, which means if I have a shopping center and got to fix a pot hole in the parking lot,

Sarah Florer (09:05.931)
Hmm.

Sarah Florer (09:09.748)
Hmm.

Joseph Gozlan (09:33.326)
or pay for landscaping, pay for the exterior lights and so on, that's common area maintenance and the landlord gets reimbursed, which is why when we talk to investors, we tell them, we don't look at triple net as NNN, we spell it TTR, transfer the risk. So, if I want to know a partner complex and my property taxes went up, I have to absorb that until I can recycle all my leases within 12 months.

Sarah Florer (09:49.716)
Yeah.

Sarah Florer (10:00.938)
Mm.

Joseph Gozlan (10:01.426)
If I have my insurance go up, that same day, I'm losing tens if not hundreds of thousands of dollars in value until again, I take 12 months to cycle my leases to increase the rent if I can because I still live in a market. If the market is flat, I can't push the rent. So by going into a triple net lease, I transfer all that risk. I had a property a couple of years ago, in 2023, we all got hammered on insurance.

Sarah Florer (10:12.635)
Mm. Mm-hmm.

Joseph Gozlan (10:31.118)
And I had a property that the insurance went from $14,000 to $27,000 a year. That was double. And, you know, unfortunately, all I had to do is call my tenants and say, I'm sorry, you're more than welcome to shop this around. I shopped it. I have contacts in the industry and that's the best I could find. But short of finding me a better deal with the same coverage, your new rent starting January is this.

Sarah Florer (10:36.608)
Wow.

Joseph Gozlan (10:59.682)
that the conversation that ended there. I lost zero value on my property. My NOI didn't change. So I transferred all the risk over. So that's why we like trip on the leases and in both retail and industrial, we found that existing in Industrial Flex which is an industrial building split to smaller unit, which is kind of like the cousin to your neighborhood retail shopping center. Again, not too big of a footprint, small units.

Sarah Florer (11:23.435)
Mm-hmm.

Joseph Gozlan (11:28.874)
We love those shopping centers and we love the flex buildings.

Roland Wiederaenders (11:33.573)
And some of the flex spaces have the retail out, mean, like in the front, there'll be a retail space, but then a big warehouse directly connected to it in the back. I'm imagining that correctly, is that right?

Sarah Florer (11:41.439)
Yeah.

Joseph Gozlan (11:49.16)
some of them are a little bit more industrious and some of them are built with a more customer face in front. We've seen like in destination retail go into flex spaces. So for example, we've seen like a gymnastic thing. Usually you would put them in a big box retail. They now found that they can go into an industrial flex building and take 5,000 square feet, 10,000 square feet, whatever they need. We've seen things like a lot of sports, a racquetball or tennis or pickleball and all these.

Sarah Florer (11:54.271)
Mm-hmm.

Roland Wiederaenders (12:04.079)
Yeah.

Sarah Florer (12:16.948)
Yeah.

Joseph Gozlan (12:18.858)
they go into those flex places. So there is very much a lot of similarity. The good flex places are also located in core urban areas where you would find retail. So yes, there's a lot of synergy. There's a lot of cross between the two.

Roland Wiederaenders (12:37.401)
Well, go ahead, sir. Yeah.

Sarah Florer (12:37.577)
I was sorry, Roland, go ahead. I was just thinking just for education purposes, from the point of view of a tenant, particularly a commercial tenant, is there any advantage to going for triple net? I I can think of one being that if you're responsible for taking care of the parking lot, if you've got a landlord who's a little bit late on dealing with stuff, you have that power in your own hands. But is that how it works? mean, is this just something that tenants have to accept?

as part of the market conditions or is there actually a reason that a tenant might actually also prefer that?

Joseph Gozlan (13:13.708)
Well, it's little bit of both. In reality, more than I just finished our recent market report on retail leasing and 94 % of all leases that were written in the last month are triple net leases. So, finding a retail space that doesn't have a triple net lease is really, really hard these days. That said, you also hit a very good spot.

Sarah Florer (13:15.157)
Yeah.

Sarah Florer (13:28.947)
Right, right.

Roland Wiederaenders (13:29.253)
Mm.

Sarah Florer (13:36.831)
Mm.

Joseph Gozlan (13:40.422)
If I reimburse the landlord for the common area maintenance, then the chances that they will neglect the common area is a lot lower. If the landlord has to think twice on when do I fix that parking lot, that parking lot is going to have a pot hole for a long time. If the landlord has to think twice about do we maintain the landscape once a week, twice a week, or once a month, then that's going to be once a month. Until somebody from the city yells at them, they have no reason to do it.

Sarah Florer (13:48.352)
Yeah.

Sarah Florer (13:54.688)
Yeah.

Sarah Florer (14:03.339)
Mm.

Sarah Florer (14:07.923)
Yeah, that makes sense.

Roland Wiederaenders (14:09.103)
That's a really good point.

Joseph Gozlan (14:09.238)
So that's kind of like why we like the triple net on both ends and I explained our tenant clients is kind of like it actually helps you. It makes sure the property is well maintained. It is a fair share. You don't pay more than your fair share. So if you take 2,000 square feet out of 10,000 square foot building, you only pay a fifth of the total cost. You don't pay the whole thing.

Sarah Florer (14:27.935)
Yeah, yeah, no, makes sense. That's interesting.

Roland Wiederaenders (14:33.093)
All right, well Joseph, I've got a curve ball for you. Is that okay? I think you'll be able to catch it. You know, one thing I've heard some people talking about recently is buying office space and converting it to residential. What do you think about that as a trend?

Joseph Gozlan (14:37.827)
of course.

Joseph Gozlan (14:49.048)
So we're talking office buildings, right? It's not like your medical office, single tenant, that doesn't happen. But on the big buildings, it's an interesting concept but very, very low probability of happening. So we look around and all your downtown buildings, they have to be built in a certain way, architecturally, engineering-wise.

Roland Wiederaenders (14:51.737)
Yeah, yeah.

Joseph Gozlan (15:16.192)
in order for you to convert them. Not every building is eligible. And the reason for that is in an office building, you usually have like one area of the building where they put all the plumbing. So think about your office building when they go to the hallway and the biopharmers are in the hallway. When you're going to convert that to apartments, you're going to have 10, 20 apartments in a floor. Now you have to have plumbing running through all of

and you have electricity running through all those spaces and so on, it's a lot more complicated and the plates between each floor has to accommodate a drill through. So if you can't be structurally supported, they can't do that. So that's one aspect of things. That's why I think I read somewhere that single digits out of the whole office buildings are eligible for that conversion. And then the other side of things is parking.

Sarah Florer (15:54.207)
So,

Roland Wiederaenders (16:06.936)
Interesting.

Sarah Florer (16:07.967)
Wow.

Joseph Gozlan (16:12.81)
is always a problem because you need a lot more parking for residential than you would for an office building. The other problem that we've seen is we've seen some investors go into a project not knowing what they don't know. And because we looked at a conversion project a few years ago and then I spoke with some people that actually got involved and did some of that. If you want to put Sheetrock on the eighth floor,

Roland Wiederaenders (16:14.201)
Hmm.

Sarah Florer (16:21.067)
Hmm.

Sarah Florer (16:28.041)
Yeah.

Joseph Gozlan (16:40.962)
here's how you're going to have to go about it. You have to coordinate a crane, coordinate with the police department to stop traffic at 2 a.m., pop out a window, crane the shit rock into the eighth floor, put the window back or at least the crane release the traffic. It's a lot more work and a lot more expensive than just, I bought some shit rock. So the finance and the math around this then also have to really work together and...

Sarah Florer (17:01.739)
Hmm.

Joseph Gozlan (17:10.72)
evident, we just saw an office building that was purchased just for that purpose in Dallas just went to foreclosure because they couldn't make the finances work.

Roland Wiederaenders (17:21.263)
They couldn't do it. Interesting.

Sarah Florer (17:21.423)
wow. You know what, Joseph, something that I've liked since the first time we started chatting was how you always come back to data and the math. And you've said that now every time we've talked, you have to do the math, you have to look at the math, you have to look at the data. that's I mean, a lot of people don't even we get told that so much that we don't always hear it. But I feel like you're very good about communicating the why of that. So that's, you know, beneficial for anybody that wants to learn about this from Joseph is that you do. It sounds like you've spent

a good amount of time explaining your industry to people.

Joseph Gozlan (17:55.532)
Well, I'm an engineer, right? My background is engineering. My previous career was an engineer in software. So, me and Excel are really good friends and I'm a very, very data-oriented person, right? If the math is not there, it doesn't work. I tell my investors, we make decisions in Excel. We don't make decisions in our head or in our gut. It has to happen in the Excel. If the Excel says it doesn't work, we walk away.

Sarah Florer (17:58.129)
Og.

Sarah Florer (18:04.265)
Yeah.

Yeah.

Sarah Florer (18:14.026)
Yeah.

Sarah Florer (18:17.949)
I like that. I like that a lot. So let's let you just touched on it too. Sorry, Roland. I don't know if you have anything else, but I was just thinking, let's hear from you, Joseph, about how you got into real estate in the first place and a little bit about who you are separate from Eureka.

Roland Wiederaenders (18:19.806)
Yeah, for sure.

No, go ahead.

Joseph Gozlan (18:31.79)
Yeah, of course. Well, I got into real estate like almost everybody else. I read Rich Dad Poor Dad and it just made sense. Back at the time, we were still students, and my wife, and we were living together in like this tiny, maybe five, hundred square feet, one bedroom apartment. And we got married and back home, I'm from Israel, back home, it's a lot more common to buy versus rent.

Sarah Florer (18:41.333)
Yeah.

Sarah Florer (18:51.135)
Haha.

Joseph Gozlan (19:01.902)
So we got some money together and we bought our first apartment, a condo. And it was like a three bedroom condo, four bedroom condo. And it's like, it's just us two with two cats, right? It makes no sense to move into this huge apartment. So let's lease it out. Again, we just red-reached that poor dad. And when we decide to have kids, we'll do that. And that was right before we moved. So we never actually got to live in that condo.

Sarah Florer (19:08.873)
Yeah.

Joseph Gozlan (19:31.694)
But you rent it out and then at the end of the month after taxes and insurance and everything else, there is something left for you and you go, that real estate's got something in it, right? And then we moved to the state, it was mid-2007 and we look around and everything is on fire. Foreclosures and short sales and all those horror stories after the 2008 crash.

Sarah Florer (19:43.817)
Yeah.

Joseph Gozlan (19:59.572)
And we said, okay, we want to invest in real estate here but we didn't know anything about American real estate. So we got licensed, that was the easiest way. And also in 2008, there was no realtor.com or Zillow that everything shows up within minutes or seconds. It was like a two or three days gap between the MLS and the rest of the world seeing it.

Sarah Florer (20:13.579)
Hmm.

Sarah Florer (20:26.974)
Hmm.

Joseph Gozlan (20:27.266)
So getting licensed gave us a real valuable head start on everybody. So that's how we got started. We got licensed. We started investing for ourselves. And like I said earlier, we have friends and family joined the pack.

Sarah Florer (20:38.699)
Yeah, yeah, that's cool. It's funny because I think now I actually haven't read Rich Dad Poor Dad. I think I've read about it a lot, but I haven't read it yet. And I probably will get around to it. But I think now the messaging is really widely dispersed. But my husband and I have always been like when our kids figure out where they're going to university, the main thing we want to be able to buy them besides paying the tuition is something to live in. You get to rent out the rooms.

that are extra and that's how you're going to pay your expenses. And so you have to make that work.

Joseph Gozlan (21:10.092)
Well, take it a step forward. Take it a step forward, get them a fourplex.

Sarah Florer (21:15.401)
Yeah, yeah, that would make sense. I think those are hard to come by, aren't they? Depends on what city you're in.

Joseph Gozlan (21:21.663)
And depends on the school, but yes.

Sarah Florer (21:23.345)
Yeah, yeah, no, that's a good idea. So, rolling.

Roland Wiederaenders (21:27.929)
Well, no, that's great. mean, I just I like that. you know, rich dad, poor dad, it would be great to have Robert Kiyosaki on as a guest. think he maybe even lives in Austin or has some Austin connections. I could research that. But, you know, it's it was so influential for me as well. And just, you know, I was I was raised without really education about, you know, finance, economics. You know, what does it mean to get a mortgage and

The public schools here really don't teach that. And this is just something that has kind of become a passion of mine. I wish I would, like you said, if I would have known what I knew back in 2008, I'd be a billionaire now. But that knowledge is just so valuable. And that's, guess, kind of what really inspired us to do this. And we were talking before you mentioned this idea of the ability of people in a way that they've never been able to before to go out and raise money.

to do these deals through the securities laws and just this idea of democratization of capital. And so I think that this has really been a great discussion, Joseph. we're coming up on 22 minutes. Anything that we left out that you wanted to bring forth or maybe any initiatives in your business that you're really focusing on at this time, bring us current to what you're working on right now, Joseph.

Joseph Gozlan (22:55.318)
Yeah, just one last point about Rich Dad Poor Dad. I got a little bit of a love-hate relationship with that book. I love it because it gets me started and got a lot of people started in real estate. What I don't like about it is that it creates a fallacy of single-family can generate cash flow and that is just not true. you're any owner of single-family tells me, I have cash flow, it's like, yes, but look at it on a multi-year and then you have cash flow these two years and then you had a water heater.

Roland Wiederaenders (23:00.9)
Ha

Sarah Florer (23:12.885)
Hmm. Yeah.

Joseph Gozlan (23:24.792)
that wipes away those two years. You had cash flow for this much and then you had a fence or an AC or something that wipes away years of cash flow. So it's a great mechanism to build equity. It's not a great mechanism for cash flow. So that one cash flow you have to upgrade to commercial.

Sarah Florer (23:26.41)
Yeah.

Sarah Florer (23:40.575)
I totally agree. I totally agree. And we have that experience actually. We have a place in London that we rent out and it's quite funny. It's like you go along for a while feeling really good and then you're like, bathroom redone.

Joseph Gozlan (23:56.32)
Yep.

Sarah Florer (23:58.635)
But the equity play, the London market is all about capital appreciation, right? It's about the cost of, well, it's kind of frozen at the moment, but it's all about, you know, hopefully prices going up for property.

Joseph Gozlan (23:59.118)
Yeah.

Joseph Gozlan (24:11.946)
Yeah.

Roland Wiederaenders (24:13.647)
Well, the idea is that you've got this little business, and maybe it's break even, but you're paying down a debt, and eventually you wind up with an asset. And gosh, I have to admit my ignorance from rich dad, poor dad, just to stay on that topic for a second for kids, particularly to understand the difference between an asset and a liability. And man, you hear, you know,

younger people talking about, I'm going to make an investment in my car, and a car is just a money pit. I mean, guess collectible cars maybe, but I wouldn't start there with investing. But just, it's a really fair point. And then I think that this is

Joseph Gozlan (24:52.354)
or even a bigger money pit.

Sarah Florer (24:54.197)
Hahaha.

Roland Wiederaenders (25:02.305)
where we see that for that cash flow, like what we said, commercial real estate's the deal. And it's great making your acquaintance Joseph and your knowledge of the marketplace and you're financially astute, obviously. So it's great making connections with really qualified people. so I'm glad we had this chance to talk today.

Sarah Florer (25:26.367)
I have one last question though, Joseph. So is your wife still working with you?

Joseph Gozlan (25:30.99)
She is fully licensed, she is a broker, but no, she's not active right now in our brokerage.

Sarah Florer (25:38.025)
Yeah, it's I'm not trying to delve into something, but I do find sometimes some people talk about how easy and well they work with their spouses and other people. You know, you've got a division of labor at home to deal with also. Right. So maybe that is the last question, actually, which is how do you keep it all going? think commercial real estate is one of those 24 7 kind of jobs, isn't it? Certainly multifamily is. And if you've got the property management piece that I mean, those those problems never end. Right.

Joseph Gozlan (26:08.544)
Yes, and on the management side of things, we no longer do third party management for multifamily. We tell people nothing people can sleep in. So we'll manage industrial retail. Yeah. No, but we still manage a small multifamily that we own, but other than that, nothing people can sleep in. And that's a hard lesson learned in blood, and tears.

Sarah Florer (26:18.091)
So the lights do go off at some point. I get it.

Sarah Florer (26:30.656)
Yeah.

Sarah Florer (26:35.605)
Yeah, imagine.

Joseph Gozlan (26:37.548)
But to your question, I don't know. So we grew up, you mentioned earlier, Roland, we grew up poor. I tell people I grew up cartoon poor. Literally had a bucket in my room for the roof dripping over the winter. So I have that drive. I don't have an off switch. It doesn't stop. My wife will be the first one to tell you that it's really easy to trigger me.

to talk about commercial real estate or any real estate really. So there's just no one suite. It is what it is.

Sarah Florer (27:11.339)
So you don't need a break.

Roland Wiederaenders (27:11.535)
We know it's, yeah, and hunger is just such a powerful motivating force. And, you know, I think we really do. I don't, we haven't talked if you have kids yet, but Sarah and I do. Do you have kids?

Joseph Gozlan (27:24.8)
I do have a 15 year old and a 17 year old and this is what have been my biggest concern and challenge over the years is you can't teach being hungry. But you have to find a balance between giving them everything I ever wanted and never had and making sure they're not growing up entitled and spoiled.

Sarah Florer (27:39.071)
Mm-hmm.

Sarah Florer (27:47.403)
Yeah.

Roland Wiederaenders (27:47.545)
Yeah.

Joseph Gozlan (27:48.684)
we can have a whole different podcast about what we did to raise our kids and make sure that they're growing up correctly. But just one thing, know, my little one reached that poor dad when he was seven. So, yeah.

Sarah Florer (27:50.599)
Yeah.

Sarah Florer (28:01.161)
Yeah, that's cool.

Roland Wiederaenders (28:03.269)
Well, yeah, that's good. They're fundamental ideas. know, this is a liability, something that costs you money, and an asset is something that's gonna earn you money, particularly earn you money while you sleep. And, you know, teaching those concepts, it's really important to start them young, so to speak. Sarah does a great job of that with your kids, Sarah, and, you know.

Joseph Gozlan (28:19.904)
Absolutely.

Sarah Florer (28:23.815)
Yeah, we do. My husband's from India, so commercial real estate and real estate is just like in his blood or something. He's not working in it, but this is something that has been talked around the table his whole life. But it comes back to what you're saying, which is kind of a segue, but financial education is something that is so important, isn't it? And I will say, Roland, because you don't have kids.

know, the young kids in the public schools here in Austin, but they do do these financial units, these financial education units. And also when we were based in Dubai, the school would do these really interesting exercises for kids that people do. But I hadn't even thought about giving my son books, Joseph. So I'm going to take that away. that might be what happens with me finally reading Rich Dad, Poor Dad. It sounds like a good project. My son's 10. But we do talk a lot about it.

Joseph Gozlan (29:09.315)
Yeah

Okay.

Sarah Florer (29:16.043)
My husband is an entrepreneur too, he has his own business, so he talks a lot with the kids about how you're kind of either a producer in society or you're a consumer. And the entrepreneurial journey is about becoming a producer in one way or another. And I think that kind of speaks to all of the... That's underlying everything, Get up and get going on something.

Roland Wiederaenders (29:44.293)
And that's.

Joseph Gozlan (29:44.61)
Yeah, I think it's the openness that's the most critical thing, right? It's being open to talk to the kids about money. It's not taboo. It's not something that shouldn't be discussed with the kids. I just had a complete review of my PFS, my personal financial statement with the kids. It's kind of like they know everything.

Sarah Florer (29:52.885)
Yeah.

Sarah Florer (30:02.245)
Yeah, we do that. Yeah, we do that too. Yeah, we do that too.

Roland Wiederaenders (30:05.637)
That's great. And that relationship is what's so important. That ability to be transparent with the kids, will cause them to be invested in what you've built. And they understand you're entrusting them with this knowledge. And hopefully, through that relationship, you're able to pass it down. And they'll stand on your shoulders rather than having to build from scratch. So that's really great. That inspires me, Joseph.

having that connection, you know, because we care about our kids and we want them to, you know, do even better than we've done for ourselves. We've been really blessed and, you know, our parents somehow, you know, despite maybe the lack of knowledge that they gave us, they put us in a position of saying, okay, well, take that hunger. You've got that hunger, go and pursue, know, whatever it is, your career in law, commercial real estate, but gain knowledge. And then we want to turn around and help others. And that's kind of part of what

And so a big part of this podcast is investor education and telling people that, you know, these opportunities exist. So this has been a great conversation.

Joseph Gozlan (31:12.75)
Mm-hmm.

Sarah Florer (31:14.185)
Yeah, thanks, Joseph. Thanks for your time today.

Joseph Gozlan (31:17.016)
Thanks for having me. I appreciate it.

Sarah Florer (31:19.563)
All right, Roland, shall I wrap it up? right. Okay, thanks everyone for joining us today on Alt Investing Made Easy. If you like this podcast, please subscribe and like this episode.

Roland Wiederaenders (31:21.441)
Yeah, I think so.

Roland Wiederaenders (31:34.083)
And remember everyone, take aim with your alternative investing strategies.

Sarah Florer (31:38.741)
See you next time.