How to Jump From Value Add to Development, with Venkat Avasarala

Welcome to the CRE Clarity Podcast with Jeremy Goodrich. Our guest today is Venkat Avasarala value-add multifamily investor turned CRE developer. In our conversation, we delve into why development is the current hot spot in REI, explore what to look out for when investing in multifamily, and discuss the importance of monitoring the money supply.

Learn more about Venkat and his story at creclarity.com!

“The one thing every investor should know is to watch the money supply.”

01:18

Venkat began his professional journey in the finance world in 2002. However, his interest shifted towards real estate, leading him to purchase his first 20-unit rental property in Dallas back in 2016. In 2018, he was able to leave his corporate job and pursue real estate investing full-time. His background in finance has helped him to become a developer for large properties valued at over $400 million.

Venkat talks about the importance of monitoring the money supply. He explains that fluctuations in the money supply can influence buying patterns and available resources in the market. He points out the impact of money printing post-pandemic, and how inflation has risen faster than wage growth, putting a strain on affordability.

“Pay attention to who you are serving. If you don’t understand your tenant, you cannot be successful.”

10:45

Venkat started investing in value-add multifamily properties in 2016, However, he transitioned to development in 2021 after exiting the multifamily market altogether. According to him, the landscape had shifted, making success more challenging.

Despite his shift in focus, Venkat shares his insights on still finding success in real estate.

• Learn about historical trends to anticipate future market changes.
• Understand your tenant. Pay close attention to your tenants' spending habits and lifestyle preferences to be able to make informed rent projections for the coming years.
• Find your niche. Identifying a niche market allows you to cater to a specific tenant demographic.

“You don't need to know everything. You just need to find people who know what you are missing and who are good at it.”

24:13

Venkat shares his advice on how to get into the development space.

• Build your network. Connect with experienced and successful developers and bring them onto your team to leverage their expertise.
• Learn to manage the risk. Always raise money conservatively and have solid underwriting.

Toward the end of the conversation, Venkat shares what he’s most excited about in the CRE world right now. He anticipates a decrease in construction costs within the coming years in the Sunbelt states.

Finally, Venkat shares one point of clarity with the listeners. Always watch the money supply!

About our Guest, Venkat Avasarala

After witnessing fellow employees’ deep despair caused by mass layoffs at “dependable” corporations, Venkat promised himself he’d never be fully dependent upon a W2 again.

It’s easy for hard-working, intelligent people to accidentally become reliant on their paycheck and miss opportunities to protect and grow their wealth.

That’s why Venkat loves sharing about multifamily real estate investments.

Since he discovered the lucrative power of commercial real estate, Venkat has become passionate about spreading the word, so others too can protect their hard-earned savings and take action toward building sustainable wealth.

Mentioned in the show:

1. https://strykerproperties.com/
2. His LinkedIn
3. www.shineinsurance.com/reiclarity
4. The REI Clarity Framework

Need an instant insurance ballpark for your next Multifamily deal?! Answer 9 simple questions and we’ll give you a sense of what insurance should be. Visit us here for everything you need to know: https://www.shineinsurance.com/ballpark/ 

Special thanks to Venkat Avasarala for taking the time to share so many great insights with us

 

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