E06: From Cattle to Hotels to Wall Street to Notes: Wade Carroll’s Fascinating Real Estate Journey

From cattle shows to Note Investing, don't miss this fascinating real estate journey of Wade Carroll where he shares fascinating stories from cattle to hotels, securities trading, and real estate investing. Gain valuable insights as Wade discusses his lessons learned in construction, property management, acquiring non-performing loans, and his outlook on single family rentals. 

Here are some power takeaways from today’s conversation:

• Lessons from raising and showing cattle
• What he learned from his hotel business journey
• Wade’s experience in stock trading
• Strategies for urban redevelopment: seeking heirs and acquiring blocks
• Transition to 1031 exchanges and property management expansion
• Seizing opportunities in NPLs and single family rentals

 

Episode Highlights:

• [27:49] Unveiling Opportunities and Building Success in Urban Redevelopment
• Wade's quest for heirs in urban redevelopment exemplified his tenacity and ability to spot hidden opportunities. One standout instance involved a valuable corner lot burdened by $17,000 in back taxes, which Wade acquired by offering the owner's daughter $10,000 for financial relief. Within a year, he sold the property for an impressive $120,000, solely based on its undeveloped land value. Wade's relentless pursuit of heirs uncovered these hidden gems, revitalizing neglected landscapes and opening avenues for urban transformation. Simultaneously, Wade strategically recognized the potential of acquiring not just vacant lots, but also houses on a single block. Through tax sales and gradual transformation into rental units, he accumulated an impressive portfolio of 650 houses over eight years, solidifying his expertise in real estate development and paving the way for further investments in superior rental units.
• [35:22] Transition to 1031 Exchanges and Property Management Expansion
• Initially focused on flipping properties to developers, Wade's expertise caught the attention of California investors seeking to reinvest their real estate sales proceeds. This led him to venture into facilitating 1031 exchanges, enabling investors to defer capital gains taxes by reinvesting in like-kind real estate. With the funds from these exchanges, Wade shifted his strategy towards acquiring income-producing rental properties, leveraging a warehouse credit line to help investors purchase portfolios of 10+ properties each. Managing over 650 rental units and $70M in real estate assets for 66 passive investors, Wade's success highlighted how 1031 exchanges allowed him to scale up and gain invaluable experience in property management of single-family rentals.

[41:07] Seizing the Opportunities in Single-Family Rentals

• Wade recognizes the immense potential in single-family rentals (SFRs) as a lucrative investment opportunity amidst the housing supply shortage. Instead of selling acquired real estate owned (REO) properties, Wade has focused on renting them out to capitalize on stable monthly income from rents, which can offset the impact of higher interest rates. With valuable experience managing SFRs during the 2008 crisis, Wade has honed his expertise in property operations and maintenance. By partnering with non-profits to acquire FHA loans, he has been able to scale his SFR investments ahead of many institutional players. Through his collaboration with GSP, Wade leverages their capital and expertise to continue acquiring and managing SFR portfolios for long-term rental income and appreciation potential. He believes that large, institutional SFR platforms will play a crucial role in the future of real estate investing, driven by the growing demand for affordable and workforce housing.

Resources Mentioned:

www.gsprei.com