Daniel Angel


Episode 18.

Daniel Angel, Investments and Capital Markets at Apex Development Group

00:00:00 – 00:04:01

All right, episode number two with Daniel Angel of Apex Development Group. Make sure you listen to last week’s episode if you have not yet. Did you know a Lanta is the new Hollywood? Atlanta, Georgia for real? The walking dead, marvel movies, anchorman to Black Panther, Godzilla, the list goes on and on and on. How is this influx, and really the boom of so many other industries affecting Atlanta real estate? And if you are a travel junkie like myself, stick around to the end to hear Daniels restaurant recommendation from me, the Ying Columbia. I really had to pull it out of them. I didn’t want to hurt any feelings, but he gave a spectacular recommendation and I’m extra excited to get across the border to try it. Thanks for listening. You’re listening to the real estate of things podcast. Welcome to another episode of the real estate of things podcast, back to back. This week you get to see my good friend Daniel Angel of Apex Development Group. Daniel, thank you for joining me for another episode. Hey, thank you again. Thanks for having me again for this second one. Absolutely so. You know, we unpacked a lot last week and we’re going to hit the ground running here. So before we dive into a little more of the business, and I really want to spend some time talking about the Atlanta Market, talk to me a little bit about a day in the life of Daniel at apex. What what’s your yeah, what’s the what’s the role? Whether you responsible for there? What’s it look? All Right, sure, of course it’s. There’s a lot to it. Obviously, as I told you before, it’s two part where two business partners, and we thankfully have a great team with us now. So today my role doesn’t have a name, but I’m pretty much in charge of CO leading the company with my business partner. But my day to day has more like the finance, structuring and investor relations, capital markets kind of kind of thing. So corporate finance and capital markets, it’s pretty much how we internally call it. And then I help out with the construction team also. So normal day for me would have a lot of excel, a lot of numbers and and pretty much, you know, a lot of communication with the construction team, with investors and obviously with our accounting team for reporting and distributions or stuff like that. Johnny got it it. Definitely knowing some of your background from the last episode, working on the private equity side, having some more institutional real estate background, that that helps give the give the structure and skills to be one of two people steering the ship of relatively sizeable and successful group. Yeah, of course. Yeah, I mean obviously it’s been. It’s been a great journey from the entrepreneurial side, because it’s not only that to it, and it’s been challenging in a way in terms of understanding that it’s not only what to do back in your desk and back in the office from your computer, but a lot of you know, feeding the ground and out in the field, in the in the job sides, with the construction team, subcontractors and everyone that has to do with, you know, the renovations or the construction part and peace. So putting all that together and today seeing it growing into a, you know, a solid team both in the states and in Colombia. I don’t know if you remember, but but we do have part of our team back in Colombia. Seeing how that all gets together and all the pieces getting together. It’s been awesome. Yeah, I do remember you mentioned in that and I’m glad you brought it up. What’s the split between the team in the United States and the team in Columbia? Yeah, so we don’t have like a…

00:04:02 – 00:08:03

…fine line. There’s there’s more like grays to it, and but essentially it’s whoever doesn’t really have to be in the states to do their job, they’ll be back in Colombia. So today we’re about sixty percent Colombia, forty percent and in terms of headcount, forty percent us. Got It kind of gotta yeah, that’s a good balance. And one of the things I love is that there’s there’s barely a time zone difference. Right. What is it? Is that our our off of ease? What’s it’s an right now we’re same time. So whenever we’re an hour ahead, for you know, like during the summer and whatnot, been we’re an hour ahead of them. Other than that, were same, same time zone. So yeah, that’s that’s pretty allsome. That crazy. I will put out an opinion here. That crazy, ridiculous daylight savings time. That throws a wrench in everything. And then we have we have one state of the union that doesn’t observe it. So you have one state that’s not all Pacific time all over the place. I that’s we need to we need more firm movement to get rid of that, just so we can stop being so confusing and no fun. But it’s and I know you know I’ve shame on me. We’ve been to Cardajana a handful of times and, as you and I were talking, got to get out and about and explore Bogatam at then so much more that we haven’t, which I’m excited. That means there’s there’s more fun to explore ahead. But it is, I know, at least out of the LANTA. I’m a you know, I flied Delta, so shout out to Delta for being a spectacular airline and I imagine you probably fly a Delta out of there. I know pre covid they had direct flight Atlanta to Cartagena and it was four hours, I imagine it. It’s pretty is a pretty painless to get down to Medine. Yeah, so unfortunately they’ll shut down the direct flight from Atlanta to Manadine, which they used to have. They still have the Atlanta Cartagena but I mean there’s other ways. You can fly, you know, v Miami or be upon them a pretty easily to manadine. Also there’s there’s a an Atlanta bubble to also direct flight, but essentially it’s no more than five hours. It’s pretty close. Yeah, it’s Nice. It’s so it’s closer than I’ve thought it was before I went there the first time. And you know, you used to European trips where, best case your eight hours on a flight overnight and mass of time zone difference and it’s so nice to be able to shoot down to Columbia in four or five hours with, depending on the time of the year, no time zone difference or an hour difference. So that’s great that you are and you’re you’re there and many in right now. Right. Yeah, absolutely, I’m you’re spending some time with family and friends for the for the holidays. Beautiful, beautiful, I love it. So so let me pick your brain a little more. We talked about your move from which is a natural move, I think for a lot of folks in the real estate world. You start out with SFAR and you’re single family housing and then you move up into more complex thing. So for you, was it you and your partner? Was It, you know, starting with rehabs, then getting into new construction, then moving into the multi family side of the fan and and and rentals and then moving into the multi family side of the fence. Was that the progression? Yeah, but the new construction part. So we’ve only done renovation and we did straight flipping originally, so buying, renovating selling. Later on, when we started our private equity funds or like our portfolios, we got into the rental portion. We just thought that having individual properties in the SFR space with individual investors would be too risky for them…

00:08:05 – 00:12:01

…because you don’t have like the portfolio advantage of things. So once we raised our two initial funds, we went into the rental portion of it. We built and stabilized a couple rental portfolios which we are currently offloading. That will run until probably have, you know, first half of two thousand and twenty two. But then starting two thousand and twenty after a great opportunity that I had. I worked for a multi family firm, wellknown multifamily firm in Atlanta for some time. We found that the you know, multi family could be our next step or a good way to evolve and and find like more scale, more opportunities to grow and obviously understanding the acid class. Clearly it required us to learn more about equity raising, a little bit more about financing, because the financing groups and the opportunities vary, as well as, you know, putting together, you know, packages for acquisitions and learning, you know who the brokers are, a lot more about the market. And we did all that part early two thousand and twenty through, I guess, q three of two thousand and twenty, and then we finally were able to acquire our first multi family and August two thousand and twenty. That’s great and and going forward, multi family is your big focus, right you you really transitioning away from the single family side of the business and really focusing on growing that multi family is all right, correct, that’s where we’re focusing. There’s, you know, a few reasons for that, some of them being, and I think none of these will be new to you or to anyone else, that that’s either and as if our multi family. But you know, having a portfolio spread out throughout the city or throughout a metro area, regardless of how condensed you managed to keep it, it’s still harder to do than than having a multi family. You know, the ability to transact at a larger scale. So it’s not going to say that the acquisition process of single family it’s exactly the same as multi family. Clearly, acquiring a multi family has more steps to it and it’s a longer period. But you know, comparing the unit size or the unit count, it’s a lot more efficient in the multifamily space. Right. We never acquired portfolios in single family, so everything that we did was one by one. We grew up single family portfolio up to shy of eighty properties, you know, without counting the renovations and like the flips, which are around a hundred properties, but all those were like one at a time, one by one, and that that requires a lot of time, a lot of effort, a lot of underwriting and and back and forth with agents and whatnot. With multi family, obviously you need to underwrite it, underwrite a lot of deals before you can actually pull the trigger and close on one. But once you do so, the unit count helps you know your volume and your skill. Yeah, I have. Have there been any big surprises or big lessons learned whenever you look back yet moving from single family to multi or is it just been a beautiful, seamless transition? Do you want the shortlist of the long list? We got a lot. Now, I mean clearly. I mean it would be naive and kind of like disrespectful for me to say that there’s no, no lessons learned or no, no, you know, bumps in the road. There’s a lot. But…

00:12:01 – 00:16:00

I think you know our background or experience and just we’ve been always trying to say humble, stray, stay like focused and stay like really true to our numbers, leave our hearts out, just keep it like really number driven. That that has helped. But clearly there’s been a lot of lessons, both in the single family space and the multi family space. But just to give you an example, once we decided to transition from single to multi family and we kind of like drew literally on a board. We just jotted down like what, what were the things that we needed to learn before we could pull the trigger, and it was like a twenty item list and that list kept growing as we kept like checking off up to like a hundred items until we could actually pull the trigger on one. It was a small multi family. The first one we acquired was a twenty five unit deal, which we still own. Not a huge deal, but it was like the deal that helped us understand what actually what were we actually doing right. A lot of things to learn. It’s been a great drive, a great experience and we’ve been able to shift around everything that has come to us, including Covid, but it’s been a great experience. But clearly there’s a lot more to whatever you can think starting off. Yeah, that makes sense. I the YOU and I caught up offline a bit and you know there’s a lot of folks who, especially interestingly during covid have taken that jump from single family to multifamily. It just seems to be a natural progression and the efficiencies that you gain via having, you know, twenty five units. Would you rather have twenty five units in one building versus twenty five units scattered throughout an entire city like there’s? There is a significant inefficiency there on the single family side of the fence that the multi family side helps out. And of course you have you know, it’s not as simple of of of an equation as that, but boiling it down, there are some great efficiency gains that you have there and no, no surprise to hear that. Even even on, you know, on my day job side of the fence at Lema, one we when I came to the firm in two thousand and fifteen we were just doing single family all right, we did rehabs and we had just started lending on rental properties and it wasn’t until early two thousand and seventeen, I think January two thousand and seventeen, that we launched a multi family product. And My head was spinning because the difference in terminology, the difference in analysis. You know, whenever you’re looking at a multifamily project, rather when you’re looking at a single family home, a single family home, you’re not a necessarily diving deep into employment data. Not a lot of those questions to be asked. On the multi family side of the fince. That becomes a bigger thing like are there, you know, as it near, a military base? Is there kind of a university nearby? How is our businesses leaving the area? Do you have any new businesses coming in? And I think that’s a great Seguay and what I want to spend the last part of our conversation talking about, which is a deep dive into the Atlanta market, stealing some of this from your deck and not a pure off the top of the head knowledge, but you know Atlanta. It’s top ten in largest economies in the US. It’s one of the largest economies in the world in and of itself. Right you have almost six figure net migration into the state, or I’m sorry, into kind of the Atlanta Metro a year. You have really business friendly, kind of the Hollywood of the East and really becoming Hollywood point out right. You look at I’m shocked. Used to be shocked, but now it’s like a routine thing.

00:16:00 – 00:20:00

All the marvel movies are made there. The walking dead was made there. Like you go down the list of movies. Atlanta has just set themselves up for incredible growth around an industry that otherwise wasn’t really present in Atlanta and not really present in the southeast. And then you have you know, good it keep on going down the list. You have my favorite airport in the world. My mom hates it but I love it. It’s incredibly efficient, Arts Phil Jackson, you know, piece of cake, favorite airport food in the world. And then you go down the list of sales force. There you have Amazon and Microsoft continuing to make pretty big investments there. So Atlanta takes the box on booming growth from an employment standpoint, from a people standpoint, and you can see this is going to be sustained to growth. It’s really the tip of the iceberg that we’re at right now and it’s super exciting. You know, I’m two and a half hours away from Atlanta, but I have a lot of close friends and colleagues who are in Atlanta. Were live, work and best in Atlanta. And how would you sum up the Atlanta Metro Market Right now? And what are you kind of reading the tea leaves on down the road? What are the what’s hot? Is there anything that’s going to cool off? Just give me your rundown of Atlanta, of course, and I think you’ve mentioned a few key parts to our analysis. Also, I had the opportunity to live in Atlanta before the big crash, so I lived while I was going to school from o two two thousand and six, and, you know, seeing what Atlanta is when I came or what it was when I came back in two thousand and fifteen, which coincident. Actually, it’s kind of like the year where you joined Lima one and when we started investing what we basically saw back then, and we constantly go back to kind of like do the text and balances to make sure that that it’s still the case. We feel that post the big crash, Atlanta has been doing a very good job at attracting different kind of industries. Right, originally you would you would see three, four five big companies and then like very industrial driven company, Blue Collar, and pretty much that was it to Atlanta right right now, as you were mentioning, you know, Hollywood too. Oh, you also have a lot of the financial companies down here. Not Not, not necessarily, you know, headquarters, because most of them are up in New York or in Chicago, but you see big offices down here for the insurance companies, financial companies, you know, banks, you know copper banking, investment banking, which at the end of the day, drive a lot more aspects to the economy than only the industrial part. Right. So once you start seeing that different types of industries come into the company, into the area or into the city in this case, we feel that it makes that base for those fundamentals a lot more solid, right, and one of our drivers have been, you know, let’s stay at least for a few years in one single market. You know, that’s where we live also, thankfully, and let’s make sure it’s a primary market, you know, in a primary market. You have a lot more levers to move around to work with whatever acids you have or you own, rather than going to a secondary or third thirds ter shary market where things get a little bit a little bit more lean, right. so that’s bay like our analysis goes back there. And then just to continue with our analysis with Atlanta, we just feel, you know, the you know, having a yearly ninety two hundredzero people coming in different industries. You know, the expansion construction. You just…

00:20:02 – 00:24:03

…feel everything like actually happening. So we just feel very comfortable with those fundamentals and and and that’s pretty much we’re will stick for for a while. Is there a particular asset class that is kind of outperforming or you feel like it is going to outperform? Is that the multi family side of the fence that you’re most bullish on? Yeah, so, I mean for apex, the residential market is that’s where will stick for now. We do value and believe in being specific and like specialized. So we decided on multi family, we feel more than outperforming, because I think there’s there’s another as a or other couple assid classes that are doing really well, including like industrial, like warehouses and self storage also, but we believe in sticking to our roots and believe in, like, being specialized in what we know. That doesn’t mean we won’t look into other acid classes down the road. Probably we will, but at least for now we want to build a solid structure around multi family. Yeah, and just on our short conversation here about the Atlanta Matro it. In my mind it is hard, you know, having a at least a superficial and in some you know, in the bigger metros, a deeper understanding of markets throughout the country by virtue of the day job at Lima. It’s hard, in my mind, to find a market maybe more attractive and in many cases as attractive as Atlanta. There’s there’s so much going for it and it is it the growth and the industries booming, new industry coming in? Does it feel like that was a an outof left field thing and one day you were like Jeez, this is this is exploding, or has it been kind of a measured over the last six years you’ve just felt a gradual uptick? Well, I think that that’s a great point and and although the pat the last twelve months I think there has been like a spike. I do believe one of the big things in for Atlanta has been the gradual growth rather than just like a huge growth like you’ve seen, like we all have seen, in La Miami, you know, New York and whatnot. You know, and just to give an example, my business partner, Daniel goes out his word. By the way, his name is also Daniel. He used to live in Miami and when we met and twenty sixteen, one of his bigger challenges was the I don’t know if it’s uncertainty, but like how hard it was to predict or or analyze in a market where you see more spikes. Obviously there’s growth, but there’s more spikes, so there’s like, we think, like more opportunities to mess it up rather than in a in a market where things go a little bit more gradual but are going, I think, a little bit more in a more predictable way. I would cut out the last twelve months, where I think it’s been just a little bit nonsense for everyone, but other than that that that would be kind of like the picture I would draw for for the Atlanta market. Yeah, that sounds spot on and it feels like, you know, a tough to peg something or tough to peg a place as recession proof, but, as you know, as as stable and as it seems like you can get a get more confidence in that medium and long term in a market like Atlanta, like you said, because you don’t have a roller coaster or you have steady growth, and that’s something that personally, from an investment standpoint, is just exponentially more attractive.

00:24:03 – 00:27:59

I know some people love the the adrenaline Junky Rush. On the dollar standpoint, I like scuba diving, I like where a mountain biking. That’s where I’ll get my thrill. I no longer like getting my thrill gambling with the dollars, on the roller dollars. It makes me sick. So I sleep better at night with with index funds as opposed to big ups and downs. And Yeah, it did. It seems like if you’re gonna put your chips on a market, you would be hard pressed to do better than the beautiful metro of Atlanta. Yeah, absolutely, and nothing against you know, liking the roller coaster or there’s spikes of the market and whatnot. I mean, obviously there’s investors for every type of acid and every type of investment. We just feel like targeting a little bit more conservative. I mean sometimes it’s called like the boring acid class because, you know, in multi family there, you know, it’s a lot more stable and a lot easier, especially if you stay like within like the sea class, be class or acid class, where we tend to to stay. We just feel security is better in this industry. And then it’s our job to find where to add value, right, and that’s where everything else we spoke about in the first episode, you know, tends to fall into plays and make sense. So it’s my job to offer our investors a stable acid and then also my job to to add value wherever I can find it without putting a lot to risk. Yeah, now, you’re right. There are all different assets to satiate all different appetites, right, and and adding a layers of complexity these of the different markets. And Yeah, there’s something out there for everyone and I just personally tend to favor your strategy and strategy of apex compared to some others. So I love it. And I’m going to end by putting you on the rack and and doing a little torture question here. This maybe the the toughest, most unpleasant question and I hope I’ll put you in a tough spot, but knowing that I absolutely love Columbia, knowing that Medine is is high on the list, whenever, you know, whenever we can get back down and get down there for the first time to Medine. The last and perhaps most important question, what is your top restaurant recommendation in Mede? Where do I go? Real like the point me, and that’s a hard one. There’s a lot. There’s I mean, as you’ve experienced when you when you went to Catana, there’s a lot of good restaurants. Same here in Menadine. But like for or for Colombian food, which I believe is is where your question is. Geared swords, I would say. I thought we oh, for sure, give me, give me the pitch, give me the thirty seconds. I’m write it down. I don’t forget. No, that’s so, you just fell it. E’s a Teo Vie Ed Oh, and you’ll find like great Colombian food, like traditional food, which which you’ll definitely love. It’s a very pinter Resq beyonce. So you’ll you’ll love it, I’m sure. Now question for you is when will you visit? I potentially que three ish, maybe, maybe even over the summer we have. We’re finally getting back to the travel bog. So I had a bunch of work travel at the end of two thousand and twenty one, and then we have Hawaii for a wedding, a friend’s wedding, which we rolled into a trip, and a couple of trips the first half of the year. So the back half of the year is looking empty and begging to be filled up with it. But I promise I would try my best to coordinate schedules with you. I would love nothing more than to break bread with you and mediating my friend.

00:28:00 – 00:29:42

Oh please, let’s do it. Happy to yeah, let’s sure calendars and let’s try to make it happen and welcome down here for sure. I love it. I love it. I cannot thank you enough, especially for doing two weeks back to back with me. It has been a blast and we’ll have to get your back on your soon for a catch up episode. Sami or dam. Thank you so much for you having buzz and having me. It’s been great too, and happy to do that cats of later on, happy to share thoughts. Thank you so much, man. Love it. Thank you, Daniel, and thanks to everyone for listening. Take Care, are you a real estate investor looking for the right lender that can finance all your deals and help you scale? Lima one capital has the best suite of loan products in the industry, Barnet. Whether that’s fix and flips, fix and holds, building new construction or buying rental properties, they have incredible financing solutions for it all. A reliable common since Linder, is one of the most important parts of your investment team, and that’s exactly what you get with Lima one. Let Lima one capital show you how they’ve helped thousands of real estate investor scale and increase their well, check out Lima onecom or call eight hundred two five nine, zero five ninety five to speak with the consultant and preparation for your next project. Thank you for joining us today on the real estate of things podcast. Subscribe and tune in weekly for new content from the industry’s best while we continue to unpack the nuances of this dynamic market. Follow US across social media for additional insights and analysis on the topics covered in each episode, and remember to rate, review and share the show.

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