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338: The Road Less Travelled with Dr. Irene Lambiris

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Buck: Welcome back to the show, everyone. Today, my guest on Wealth Formula podcast is Dr. Irene Lambert. She is an internal medicine specialist in Henderson, Nevada. Although now she is only part time and she is a full time real estate investor. She’s been all over you know, you’ve probably heard her on other podcasts of it. Very interesting story. And she’s got, you know, lots of years of investing experience and all sorts of interesting strategies. So I wanted to make sure we got you on the show. Irene, thanks for joining us.

Irene: Oh, Buck, thank you. It’s a pleasure being here. And.

Buck: So tell me a little bit about tell us about your journey. Right? Like, I mean, I have my story where I had no idea, you know, anything about business or real estate and stuff until I read a purple book, you know.

Irene: Now we all read the purple book. We love the purple book. Yeah. I mean, I well, my story is I was born in New York. My parents came from Greece. So they were they were immigrants and they had their own businesses and they purchased real estate back in the eighties when interest rates were like 18% or something crazy like, you know, zero down, high interest. And they just bought a lot of different buildings here. I was the oldest of three, so I was, you know, in charge of helping my parents with the renters and all of that. It was like growing up, you know? And then I just decided to become a doctor material estate. And as I was going through med school, helping my parents, realizing they retired at around age 54 from work and because of real estate.

And I felt like, wow, if I saw a lot of people who maybe were not us were more educated than my parents, maybe born in the U.S. that were still struggling and working, especially patients where you know, they’re they’re alone. They don’t have any money. They’re living in retirement homes. It just started to feel like, no, this this is, you know, pivotal now, like real estate, I think, is the key to wealth. And so I started buying right after I finished med school during residency, I started buying a lot of single family homes. So I had about a dozen homes over a decade that I bought, fixed, flipped, lived in, rented, sold, Airbnb, all of that, and then in 2020, I was furloughed from a couple of my hospital jobs and I felt, you know what? Time to really get serious about investing full time. And then I switched hats and went into full time real estate investing. So.

Buck: Well, that’s that’s interesting. So in terms of real estate, you mentioned you had a a single family portfolio that was pretty significant. How did that go? And is that still part of what you’re doing today in real estate?

Irene: Yeah. I mean, so I like I basically had vanilla homes. I had homes that I would live in three bedroom, three bathrooms near hospitals or schools. That’s like anywhere I would live. That’s that was my strategy. I was at that time, single woman. I wanted a safe place, you know, and so I would live in the property and then I would purchase another property within a couple of years and rent the original property. And so I would I would not pay the capital gains. You know, that’s awesome. So after a while, I felt like it was just not scalable for me. I didn’t want to manage all of that. I was doing a lot through Zelle and you know, I, I had I was really lucky. I had great tenants most of the time.

They, I didn’t really have any issues, but it wasn’t scalable. So I during COVID, I sold the entire portfolio and I purchased a triple net of properties like Dollar General’s family dollars, gas stations, things that would be like 20 year leases, 15 year leases. And during 2020, 2021, I had really great interest rates at that time. So I don’t know if anyone was purchasing at that time. So cash flow was great, return on investment was great, and I still felt that syndications were also great because there’s just so little that you need to do with these types of investments and and they’re scalable, right? You can invest as much as you want. You can buy as much as you want. And then eventually your assets are buying assets like the castle from those assets are, you know, creating their assets for you.

Buck: Yeah. You know, and I think your journey is actually pretty common from what I’ve heard with people who have, you know, make a little bit more money positions and stuff too. You know, we all have our moment in this space where we’re like, oh, wow, you know, just buy a bunch of stuff and then cash flow starts happening and, you know, and the next thing you know, it replaces my, you know, my day job and and I’m off to the races.

But then you realize somewhere along the lines is that. Yes, but there’s easier and harder ways to do that. And I think single family homes are challenging. And because, as you mentioned, like, you know, you get lucky with tenants. I mean, we have investors in our group. We have like murders, you know. And things like that. That’s right, Tim. That one was for you, by the way. And and, you know, in in so being able to, you know, either do that versus multifamily and then multifamily is tricky because, you know, you got to buy something. You need to buy something that you are interested in potentially managing and all that stuff.

And it gets tricky in it and you raise a good point for a lot of people in medicine. We’re busy people. I think they ultimately end up falling on the real estate syndication side of things because of that. But you what got you interested in particular in triple net? First tell tell everybody what 999 is just in case people don’t know what that is.

Irene: Triple net investing is when you purchase a property and the tenant is responsible for the property taxes, the improvements, the utilities, maintenance, and you’re basically just purchasing the property. And most of my tenants are, you know, a fortune 500 companies like Dollar General, Family Dollar, you know, so so the triple net investing is a lot easier than purchasing single family homes as an investor.

First of all, the bank is looking at the the tenant and the tenants finances, you know, more importantly than yours. And so, you know, if you’re busy, doctor, and doing the things and you have the cash to buy it, you know, really necessarily have to prove your financial prowess just, you know, and when you’re doing it for single family, I mean, I feel like they want everything from you at that point. You know, for a triple net, it’s mostly the tenants finances that they’re looking at. So I just yeah, I did the numbers and, you know, I was it was like over 10% returns. Some of my investments are 11%, 10%. And I felt when I was looking for a multifamily, it’s because that’s truly my first love. My parents had multi families, all of that.

The fact of having multifamily, putting money into it, getting a property manager, scaling it, possibly renovating it, selling it in five years and it just felt know time versus ease for me at the time the triple nets were made more sun you know. And then as you free up your time, you know, and you don’t really need to be doing your day job per se, then maybe you want to do a multifamily, and then you could fly to the property and hire and kind of, you know, do that if you’re interested in like owning something like that, syndications, similar use.

So, you know, a lot of syndicators are paying like 9% returns monthly you don’t to worry about anything I still getting the tax deductions just a little less control over the sale of the property. And so for a for that triple net property, I felt, you know, this is easy and I could sell it in seven years, ten years, four years, two years. One of my properties went up so much in value, I sold it after like one year and then I, I flipped it into another into syndication. Yeah. So, you know, for me, it’s not only purchasing property, but when is the right time to sell and capitalize on that equity? And can you put that equity into something that makes more money so you just get there faster?

Buck: Let me ask you this for a triple net property. So I I’ve never done I have never done triple net before. And I but I you know, I obviously do a ton of apartment buildings and pretty reliably we can get, I would say, at least 30% of the asset price depreciation with bonus depreciation after cost segregation. And also so basically 30% personal property, 70% real property.

And the advantage of that is a lot of times, you know, your down payment is 30%, maybe a little bit, or you might in our case, you know, it’s like we have we also have a lot of capital expenditures because we’re value add. But what kind of experience have you had on that front with triple net? I’m curious, especially because I know your tax focused as well.

Irene: Yes, I have a great broker and a great person that does my cost analysis through my broker and so it just depends on the property. So, yes, I’m probably more like 75% of my down payment is deductible. Yeah. Yeah, of course. Yeah. So now Biden’s changing that law. So I think there’s going to be a de-escalation of that like over the next two years.

Buck: 100% bonus depreciation still this year and then it goes down by 20% per year. Yeah, that’s the phase out. So we’ll call and then let’s let’s shift you a little bit about the business stuff because that is, you know, that’s that’s a very interesting space. And I’m curious, you know, first of all, you mentioned, I think, getting ten, 11% cash on cash on that. And that’s really good. Do you do you credit at a lot with the rates the way they are? Can you still do that right now?

Irene: Really hard to do that now. That’s why I you know, when I was looking in 2020, it was just, you know, it was really easy to purchase because of the interest rates and the sales price and the cap rates at the time. So cap rates have, you know, as you know, they’re they’ve gone down since then. And so it’s a little harder to make that.

So my last purchase, which was I just closed in July, was a gas station. So that they have 3% bump increases like every year and there is a 20 year lease on the property. It’s again triple net and it was wonderful for tax reduction purposes. So I was fine with that. But I’m a contrarian by nature, like I don’t really go with the crowd. So if everyone’s buying stocks, I’m probably not going to buy them. If everyone’s buying real estate, I’m probably going to look at other things do. And so now with real estate being that it is, you know, I’m just kind of have some cash on hand taking a step back and looking at more like businesses like small businesses for sale that cash flow and looking at that I think we talked about that I and our other conversation that that’s kind of what my focus is going to be on in 2023 along with my syndication, you know, syndication investments, so, so real estate but do a little.

Buck: And maybe you’re just in part of the the other thing I think we had talked about before was that I think you mentioned that you thought that this time that we’re in right now is actually kind of been, at least from a price perspective, a good time to buy businesses. Is that is that true?

Irene: I think so, yes. I mean, just my opinion. But when I sort of started to buy real estate, it was a great time. Right. You know, houses are sitting on the market. Prices are really low. There was you know, there was not this fervor of buying real estate. You can get great deals. Rents are a great I mean, what I’m seeing now, the small business space, the same thing like small businesses that are cash flowing, possibly been worked with the same owner for 15, 20, ten years now they just kind of want to retire. They’re sitting on the market for so many months and I feel like it’s it’s a good time now to start looking at purchasing businesses. And so I look at very kind of boring businesses. So anything that you know.

Buck: We’re all above boring here. I mean, if, you know, I’m a big advocate of boring.

Irene: Yes, we love boring, you know, recession proof, cash flowing. And, you know, again, I am still a doctor part time, so I still have, you know, something that, you know, I’m I’m good at that. I love seeing patients. So I don’t want something that’s going to take all of my energy. And you know, so I’m looking at something that is recession proof and then I can add value just like we would add value to a multifamily.

You know, weather improves the business exterior or improve it on marketing side on the Internet or get it on Instagram or, you know, just kind of mobilize it and then add some value. And then in a few years, you can sell that business and, you know, make a high return. So you.

Buck: Make it. Are you are you seeing some good tax advantages there, too? I mean, obviously, with the service station, you get a really there’s a lot of yeah, a lot of depreciation there. But in general with other kinds of businesses.

Irene: I think it’s so real estate’s number one in terms of tax, you know, saving on taxes, as you know, I mean, you can speak to any CPA, not just my opinion, but so yes, you can write up a lot of business expenses to grow the business, but you have phantom expenses with real estate that you have these losses, but they’re not really losses.

So, you know, so I think the best tax advantages with real estate. So I will still continue to purchase real estate. I just I’m a little bit you know, deals are a little bit slower now by and I will aggressively invest in syndications and continue to invest in syndications for my, you know, just for that use of that as well. So I like the self-storage. I think, you know, I like car washes, I like multifamily. You know, all of that is good to know.

Buck: Yeah. I think, you know, one of the things that I’ve always been a little reluctant for on businesses is I actually, you know, I feel a lot more comfortable starting a business from scratch, which is like completely the opposite of what you would think. But I’ve done it, you know, multiple times now. And so, like, the, the, the thing that when you have a small business and I’m, you know, talking about probably something with revenue, 5 million or less or something like that is that a lot of times the there are there’s like the key people, the key cogs and variables that make it all work. And you know who those people are or what those, you know, those variables are when you start a business, it makes me nervous buying a smaller business because I don’t know what those variables are. I don’t know who those people are. So, you know, I’ve been interested in looking at businesses myself, but, you know, potentially on a larger scale so that I could avoid that. But I’m curious what your what your experience in that part has been.

Irene: You know, that’s for me, it’s more of really doing your due diligence, having the right team. So I have a business attorney that reviews all documents with me. I have a business broker or my CPA. So I have that team that’s going to help me avoid any pitfalls. And just like with real estate, you’re looking at something like, is it in a good location or is it, you know, am I going to be able to add value? Am I giving it a good purchase price? So you can do the same thing with small businesses? And and I’ve never really started a business from scratch like use. So for me it’s really comfortable for me to like come into a small business, get to know the owner, get to know the employees and then and then go from there and then add value from there.

So my strategy this year was potentially buying like one or two or even three small businesses and running them and seeing how they do. And again, I only buy for cashflow, just like some of you know, most of my real estate. Like if it’s not going to cashflow and it’s not going to pan out, then I would have purchased it.

So it has the castle from day one. Yeah. So I feel like that reduces the risk a little bit there. Sure. And you know, and you do have a great point like with big businesses like my bankers. And, you know, the context I have in the banking industry are lending for businesses upwards of 5 million. So some people feel like this is too small, you know, for that for the big banks to lend on. But you can do seller financing, you get creative as a lot of other ways. You know, smaller banks like credit unions can also help with lending, personal loans, things like that. So.

Buck: Yeah, yeah, cool. You know, like I know you’ve been sort of an advocate for taking finances into your own life, into your own hands and all that. Tell us about some of the I mean, if you wanted to I know you’ve talked about generally sort of this, you know, the details. You know, you’ve been talking about triple net and businesses. Have you developed a overarching sort of strategy or sort of a personal philosophy to investing that is driving everything that you do?

Irene: It’s a great question. I think we all like, as you know, as a doctor, I mean, I’m super competitive, want the best, like a workaholic, all of those things, you know. So I think what’s driving me is I really want to be more successful than my parents was like the initial motivating. I feel like they were immigrants. They didn’t speak English, they had businesses, they had a real estate. They retired at age 50 and they’re super happy, right. So, you know, ideally, just like, you know, America’s dream right there. So I actually so like that to be as successful as they were and then just go from there was my initial motivating and I really do that. I accomplish that through budgeting. I really look at my finances, know where everything is going. I feel like if you’re organized to do that, it’s very it just keeps everything on track. If you’re not organized, find someone who is. And so that helps me track everything. And then just having a certain idea in my mind, like what I want, what my net worth I want my net worth to be, what I want to be making passively and how, you know, once I reach that position and like what do I want to do with that?

Because as you say, it’s not just about finance or money, it’s about quality of life, spending time with your family, you know, giving to charity, like other things that open up your time. And then with a lot of doctors now on Cobra, there’s just such a burnout. You know, there’s such a burnout from work. I, I see some other of my colleagues and it just I really feel like education is a necessary financial education for, for a lot of these high income earners that are really just focusing on their profession and not really focusing on their their quality of life. So much for me like to challenge in the physician community. I mean, it’s been they are very difficult to people to to change minds. And I gave up on that long ago. Right. Like, you know, you look at sort of some of these communities that are out there right now that are, you know, that are pretty traditional type of investing.

Buck: And they have their own mantras about save, save, save and live like resident and all this stuff. And it’s it’s hard to penetrate that. Have you I mean, have you made an effort in that? And what what kind of reception do you get? Because I sometimes end up just getting hate mail from across from people saying, I’m a devotee of the blank, blank investor, you know who I’m talking about. And and you suck and you’re whatever. And I’m like, okay, whatever, dude. So and so tell me about your experience there.

Irene: So I’m going to be very political in my answer here. I know. So you know, I do listen to the blank blank investor, too. I mean, I’m very I’m an advocate of financial education in general. But I love your podcast. You know, this big fan. I think for me, it’s just all it’s just the numbers, right? It doesn’t really care. I mean, I am not a save and invest in the market and wait for my three or 4% per year because to me that’s like lack of control and my expenses.

Real estate has been a good one. I think most doctors are just the easiest thing for them to do is to invest in the stock market, right? Like for most, you know, it’s just the easiest thing here is my money, you know? Yes, I want a few million bucks when I retire and that’s fine. But I think if they really started to realize, like the amount of, you know, like positives of real estate and it’s just a fear thing, right?

You have to overcome the fear of investing. So that’s why starting small is important. Obviously, you the your listeners are already you know, accredited investors and know, you know, what they’re doing here. So it’s a little different. But when I speak to doctors, it’s it’s like gentle nudge and I don’t really try and push it on them. And a lot of times I get like, Oh yeah, sure, I’d love to do that. And then I never hear from them again and or I give them my, you know, the contact to my brokerage, my syndicator, and they just never end up investing. So I think it’s more of like overcoming that fear and just doing it. And, you know, I’m not afraid of real estate because I’ve done it, you know, but I really don’t have a41 care and I really don’t invest in the stock market, in all honesty. But, you know, I do like some gold, some Bitcoin and all that other stuff, but nothing. You know, I’m not depending on that for my financial retirement, although, you know, I may potentially invest in the market at some point. Yeah.

Buck: I mean, listen, if the market goes down by and, you know, all of a sudden goes down by 30% or 40%, hey.

Irene: Yeah. Well.

Buck: I as well write it back in.

Irene: I bought during Kogut for sure. Like everything sounds like, okay, let’s do this, you know?

Buck: Yeah, yeah, absolutely. So no, I, I’m with you there. I was just more vocal and sort of there’s a mentality that it’s just been difficult. And I just decided I’m just not interested in it. And I think it’s kind of a mutual thing at that at this point with the dominoes. So what are you doing? I mean, you’re on a lot of podcasts, right? What is it that you’re what are you what is your goal in in doing these things? And what are you know, what do you see down the line is sort of maybe the next step.

Irene: I think, you know, for me is just continuing to educate other people. I mean, I’ve been you know, my life has changed because of the books that I’ve read and the people that I’ve met. And, you know, the podcasts I listen to and I mean, the value that they provide for me was just beyond measure. So I wanted to just kind of return that.

And maybe there’s someone out there that, you know, resonates with, you know, with me. And, you know, I can motivate them to do something different with their lives. You know, I, I just feel like, you know, as, you know, I paid I did my due diligence. I’ve paid my taxes. I’ve done all of that, you know? And if I don’t have to do that legally, why would I? And so just spreading the word continue to spread the education you’re is important to me. So I really don’t get anything out of it other than personal gratification and feeling like, you know, if I change someone’s life, great, you know? And it’s also great to network and connect and find like minded people that you feel comfortable with. Because I can talk about this at a dinner, but if no one is interested, then you know the conversation gets, right?

Buck: Yeah, absolutely. Yeah. You know, I totally that’s and that’s why we, too, are we’re like a group called Wealth Formula Network. And it’s, you know, it’s online community and it meets every other week and, you know, Facebook group and all that kind of thing. But it’s like the same concept as like you know, if you’re into this stuff, you’re not going to be very popular. Parties usually, you know? So it’s a good place to like sort of, you know, duck away and secretly talk about these things that you’re nerding out about.

Irene: Exactly.

Buck: Cool. This is well, this has been fantastic. I mean, so where can we learn more about you and what you’re doing? Do you have any of you read any books or so?

Irene: I have some upcoming things coming, so I’m going to be on another podcast, co-invest her with bigger pockets, and it just solely for women investors. And they range from really young women investors who are just starting to like more a seasoned investor. So I’ll be on that podcast in October and I can give you the dates. It’s like October 26 and anyone can find me on [email protected]. Same on Instagram. I am creating a course for high income earners about investment strategies and my strategy with triple net syndications and how I use it to benefit me tax wise. You know, I carry a real estate professional status and so some people need to know what that means and what it is to be an accredited investor or, you know, I also invest, diversify with hard money loans and just having, you know, introducing them to my contacts that I’ve already vetted. So people can feel a little more comfortable. So so that course is coming out probably by November one.

Buck: Sounds good. Irene, thanks so much for being on Wealth Formula podcast.

Irene: Thank you so much. It’s a pleasure.

Buck: We’ll be right back.