Building Your Multi-Million Dollar Renovation Team
If you want to be a serious real estate investor, you must start building a strong team. It’s a question that if it hasn’t crossed your mind yet, should become one of your top priorities. When I started in real estate we had 0 employees. Once the portfolio started to grow, I started building my team, which has allowed me to scale and multiply my efforts 10 fold. I remember when I brought on our first employee. Back in the day I had posted an ad on craigslist looking for a full time maintenance and apartment remodeling candidate. It was easy to add this employee on because we were remodeling dozens of apartments each year with subcontractors.
I remember the interview well, we met at a coffee shop and we had a short but good conversation about his skills. He explained how he was very versatile and was competent in almost anything with his experience. I delayed in hiring him at first. He was very quiet and I was unsure about him, like most people you meet for the first time. Now that I have hired dozens of employees I have learned that there are two things you should look for…
- The people you hire must have a superior work ethic, be self driven, and have the ability to work on their own with minimal direction.
- Your next hire should also either be a fast learner or have expierience on the tasks you want completed. Your team should be curious about the entire process and want to learn how all the pieces fit together.
I used to have a subcontracting crew for our projects so I wasn’t under pressure at the time. I remember him telling me he was good at everything, which I remember thinking in the back of my mind, “yeah right, everyone says they’re good at everything”. When someone says they are good at everything, keep in mind that everyone has a different opinion of good. Sometimes good is good and sometimes good is bad. Once I contacted him a couple days later he said he had chosen another position, which was a little disappointing. I mentioned to him that if anything happens, to give me a call back.
I was spending thousands of dollars a week for contractors to perform work. It was expensive and the results were not as good as I wanted them to be. My prospective hire told me he would let me know if the position he took didn’t work out. I remember thinking to myself, “yeah, it probably won’t work out”. The construction and property management industries have a lot of business owners who do not treat their people well, which leads to employee turnover. Luckily he called me back a week later and said his initial position didn’t work out and he wanted to come work on my apartment renovations with me.
I was lucky because I later found out that he was an excellent painter, had experience in many facets of construction and worked well with his hands. He could do almost any task he was given. Siding, pre hung doors, carpentry, kitchen installs, tile, drywall finishing and so much more. I was spoiled with his skillset. As our team grew I went through dozens of new hires before we found several other strong employees. We hired and fired people very quickly because they lacked the skillset and experience to deliver the quality we demand in our apartments. The labor market is very difficult and takes a lot of patience. It has increasingly become more difficult.
I have somehow always found a way to attract talent to build the team, You have to be vigilant and have a great workplace for your team to thrive and grow. You have to keep everyone engaged and help them grow. I have gravitated to hiring experienced employees with great work ethics. Our new hires tend to be people who have had a job for a long time but just want a change. Most business owners treat their employees like numbers. The result of treating your people like numbers results in a higher turnover rate. If your team remains happy, appreciated and a sense of longevity for future growth, you will retain your team and grow together.
If you renovate at least 12 units per year, you should have 1–2 full time guys. If you have 100 units, you should have 1 full time maintenance guy to do service calls alone. I usually figure that 1 unit should be completed within a month or less. That means you can keep 1 full time guy busy for 12 months. If you renovate 24 units you need at least 2–3 full time employees. The formula continues on from there until you are doing massive volume and you can create more efficiencies.
The original article was published here on Matt’s website.