Growing Rich Through Multiple Streams of Income

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Having more than one source of income is the best way to build and secure wealth.

Kay Kay Singh is a Microsoft-certified systems engineer turned real estate investor and entrepreneur. He’s a GP in 5500 multifamily units, and the owner of several gas stations and ground-up laundromat builds. From doing proper due diligence to leveraging technology, Kay Kay shares the secrets to his success in these different spaces.

[00:01 - 08:16] Buying 40 Single-family Homes All At Once

  • Kay Kay on his background and experience working with an old school owner
  • Going on his own and incorporating technology into his process
  • Why he transitioned to being a passive investor
  • His plans for his gas station business

[08:17 - 13:28] Proper Due Diligence in Loans

  • The importance of catering to investors
  • Investing with his own money
  • Why they do non-recourse loans
  • Doing everything from putting the risk money down to the asset management

[13:29 - 17:56] Using Automation in Business

  • Seeing the need for a laundromat in his neighborhood
  • Creating a card system to solve a problem
    • Incentivizing customers to adapt
  • How his customers are in a way working for him for free

[17:57 - 19:18] Closing Segment

  • Reach out to Kay Kay!
    • Links Below
  • Final Words

Tweetable Quotes

“I'm very good at communication. When somebody texts me, emails me, calls me, I try to answer their calls as soon as possible. So I'm trying to do my best to cater to my investors, and that way, I can raise capital easily for my deals.” - Kay Kay Singh

“I don't have my investors in the deal if I can’t invest my own money because my investors are my net worth. So I have to be very careful. I'm not deal-hungry, so I'm not getting on every deal that that comes across my desk. - Kay Kay Singh

“I looked at everything and I tried to do my best to get everything in and make the customers happy and also provide something different.” - Kay Kay Singh

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Connect with Kay Kay Singh through the Grow Rich Capital website.

Resource Mentioned:

Think and Grow Rich by Napoleon Hill

Connect with me:

I love helping others place money outside of traditional investments that both diversify a strategy and provide solid predictable returns.

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Like, subscribe, and leave us a review on Apple Podcasts, Spotify, Google Podcasts, or whatever platform you listen on. Thank you for tuning in!

Email me → sam@brickeninvestmentgroup.com

Want to read the full show notes of the episode? Check it out below:

Kay Kay Singh 00:00

I wanted to give something good back to the community as well. So I bought that lot and built it from ground up. And it's a card system and bigger machines. And I did one year of research before building it. So I had looked at every aspect, every equipment that is needed, and even 15 years from now.

Intro 00:24

Welcome to the How to Scale Commercial Real Estate Show. Whether you are an active or passive investor, we'll teach you how to scale your real estate investing business into something big.

Sam Wilson 00:36

Kay Kay Singh is a Microsoft-certified Systems Engineer turn successful multi-business owner and a real estate investor. Kay Kay, welcome to the show.

Kay Kay Singh 00:45

Thank you so much for having me on your show, Sam.

Sam Wilson 00:48

Pleasure's mind. Three questions I ask every guest who comes on the show in 90 seconds or less. Can you tell me where did you start? Where are you now? And how did you get there?

Kay Kay Singh 00:56

I started in real estate in 2015 by buying a portfolio of 40 single-family houses now. I'm a partner in 5500 multifamily units. And to get there, I started investing passively when I bought this portfolio, I started investing passively with the other partner, other syndicators and then learn from there and transition to the GP-side back about four years ago.

Sam Wilson 01:26

That is a heck of a leap into real estate. Most people don't buy 40 single-family homes all at once, what gave you the confidence to say, Hey, this is this is something I think I can execute on.

Kay Kay Singh 01:40

The guy who sold us is from our community, very respected guy and is a senior citizen, and he wanted to return, he promised me so many things that I can decline.

Sam Wilson 01:52

He promised you so many things. What does that mean?

Kay Kay Singh 01:55

That means he gave me a good deal, number one. And the second thing, he promised that I don't have to spend a penny to get down the portfolio. So kind of self-financing. And the third thing, he said, I will train you for a year.

Sam Wilson 02:11

Wow.

Kay Kay Singh 02:12

Not all things happened. He changed his mind about the seller financing. And we had to go to the bank to get a seller financing. But in trade of that I got a one house free. And also when he started training me, he was old school. So he was doing everything with a pen and pencil. I didn't like doing that. Being a Microsoft-certified System Engineer. I wanted to use the technology available these days to manage my properties. So I let him go after 10 days of ownership.

Sam Wilson 02:49

So the year deal didn't really matter if he was there. You said hey, I figured it out pretty fast and said I can do this better after 10 days.

Kay Kay Singh 02:58

Yes.

Sam Wilson 02:59

What were some of the things you implemented? Obviously getting off pen and paper was one of them. But what were some other things that you looked at and said, Man, I can do that better.

Kay Kay Singh 03:06

Most of it was technology. So I read online and bought us property software, property management software and a lot of other technology. Everything was paperless. So I made everything paperless and convenient. I didn't have to sit in the office. Also with by signing the property management software, everybody was paying online. Or I had a lockbox, they could drop a money order check over the lockbox too, so I didn't have to be there. First thing I made myself independent because at that time, I was managing a gas station and a laundromat. So I didn't have time to sit there in the hours and wait for the tenants to come and pay the rent and tell me all the stories they have.

Sam Wilson 03:51

Right. Yeah. Were there any other surprises when you took that portfolio over?

Kay Kay Singh 03:56

Not really, because he was very honest and telling us everything he had. And I did work some of the properties. I didn't work all the properties. And he was very transparent.

Sam Wilson 04:09

Wow, that's unusual. Good for you.

Kay Kay Singh 04:12

There weren't any deferred maintenance either.

Sam Wilson 04:14

Wow. That's fantastic. You quickly transitioned though, to being a passive investor in multifamily. What was the thinking or what was the impetus to do that?

Kay Kay Singh 04:26

When I started the real estate, I thought, Okay, now at that time, I had eight gas stations and a couple of laundromats and I thought okay, now we won't have to pay any income tax because we are in the real estate business, but we ended up paying more tax. And then I thought okay, I thought we can be in the real estate business and not pay any tax but I'm ending up paying more tax. So I checked up with my account and I started researching myself. And then I came through the word syndication and passive investment I've never thought of before. But then I immediately invested with one of the syndicators in Indianapolis, where you are from. So that was my first investment. And I started learning from there. And then I invested heavily passively.

Sam Wilson 05:18

What caused your taxes to go up when you acquired 40? Houses? I mean, those are no depreciation, no...

Kay Kay Singh 05:25

Because there was no, we didn't get any costs. Actually, I didn't even know there is any cost segregation or anything at that time. So my taxes went up, because we've made a lot of income from those properties.

Sam Wilson 05:40

Right. Interesting. Okay, yikes. Yeah. And so then you said, Alright, so I can figure this passive investment thing out, what's your long term, what's your long term plan in real estate investing, like, you go fat 10 years from now, where do you want to be?

Kay Kay Singh 05:55

I still partner with other people and do deals, and I want to do my own deals at some point. I have sold for gas stations last year, I'm trying to get little stuff off my plate before I jump in by myself. I have been partnering with other good operators and doing deals for the last four years.

Sam Wilson 06:17

You sold four gas stations, gas stations seemed like one of those things that especially in a time, you know, in a high inflationary environment, that would be a very nice asset to own because your product gets repriced daily, is that not a fair assumption? Or am I missing something there?

Kay Kay Singh 06:34

I don't think so. Because there is a labor problem too. So you can keep up to date with the rising prices, sometimes you end up selling cheaper, the wholesalers have a lot of more infrastructure than we do at the gas station level. So they can raise the prices with one click of a button but we have to bring all the stuff into the office, scan them and change the pricer and all that. So we don't have that kind of technology. And we cannot afford that kind of technology to keep up. So sometimes we end up selling cheaper stuff, we don't get time to update the pricing on daily basis.

Sam Wilson 07:12

Interesting. So that sounds like one thing maybe you didn't like about the gas station business. What were some other things in it that are maybe given you like, Hey, I think there's more opportunity elsewhere?

Kay Kay Singh 07:23

No that I didn't like I have been in the gas station business for 22 years. I still own several gas stations. But I think it's time to get out of it because I'm getting old. And gas station needs a lot of daily work. So I think real estate is much better, where you can work from anywhere. I mean, gas stations, I've really done work during the last 22 years in the gas station business. I'm not saying anything about the gas station. That's all we knew about seven years back, I'm trying to get some stuff off my plate so that I can focus more on multifamily only.

Sam Wilson 08:03

That is really cool. I love when people have multiple income streams when you're in, you know, obviously multiple businesses, things that generate revenue, because it gives you a perspective other people maybe don't have. So you love real estate, you love what it does for you. But you've come in on the passive investment side, and then you've come in on other 5500 units on the general partner side. It sounds like you'd like you said your long term goal then is to be the active sponsor. What are things you're doing right now as part of the general partnership where it's a good relationship for you and your other partners?

Kay Kay Singh 08:38

I focus on capital raising, and I do have the network to sign loans, etc. So I'm on KP on a lot of deals as well. But I kind of I have a passion. I'm a people person I have built trust over these 22 years I've been here in United States, I'm very good at communication. When somebody has they text me email me call me. I try to answer their calls as soon as possible, etc. So I'm trying to do my best to cater to my investors. And that way I can raise capital easily for my deals.

Sam Wilson 09:16

Talk to us about the loan guarantor side that's not something we spend a lot of time talking about, what are things that you are seeing on the loan guarantor side you'd like and what are things that concern you about it?

Kay Kay Singh 09:28

Of course, there is a liability, there's a risk, but I do my proper due diligence before I sign the loan, I don't want to put my net worth and that gives me confidence and I invest my own money in every deal. And that gives a less, I don't have my investors in the deal if I can’t invest my own money, because that is, my investors are my net worth. So I have to be very careful. I'm not deal-hungry, so I'm not getting on every deal that comes across my desk. I do my own due diligence, I do underwrite by myself. If I like the deal, if I like the market, if I like the sponsors, then only I do the deal.

Sam Wilson 10:11

When you're a loan guarantor, are you doing non-recourse loans only?

Kay Kay Singh 10:17

Yes, because we do larger properties. So those are always non-recourse loans. And also, by signing the loan, you are on the right side of the law. And also I'm because legally, you cannot only raise capital, right? So I'm signing the loans, putting the earnest money in doing going to the due diligence and attending the asset management calls and everything. So to be a part and that way, I have more confidence on the property, because I'm on their weekly calls every week and know a lot what's going on the property, etc, that I can communicate with my investors.

Sam Wilson 10:57

Yeah, I mean, I think it's interesting, obviously, on the loan guarantor side, because the lender wants to make sure that even if the property doesn't perform that there is a balance sheet, that or balance sheet partner, obviously can come on and cover that debt if for some reason the loan, or the property isn't producing enough income to cover the debt. I think it's also intriguing when you get into these situations where it's non-recourse, so even if you decide yourself, you're not going to pay it, they can't necessarily come after you. So it's kind of an interesting mix of like, why do they even need a loan guarantor, right?

Kay Kay Singh 11:30

Well, if something goes wrong, there are cards in those recourse loans, too. So if something goes wrong, they can still come after you. And they're gonna have you send your quarterly, your bank balances and all that quarterly. They want to make sure that the backup is good enough.

Sam Wilson 11:49

Right. Right. No. Understood. Understood. Yeah. I mean, there's always the bad boy, we call the bad boy carve out. Yeah. Right. So if you guys do something not supposed to do, which, I mean, obviously, that puts a lot of that means you have to have a lot of trust in your other partners, that they're gonna behave ethically, morally take care of everyone in the process, and not things they shouldn't be doing. What is a typical structure? I've heard all sorts of different structures on a loan guarantor side tell us, maybe you know what you see the typical structure for a loan guarantor when you come on as a general partner.

Kay Kay Singh 12:23

So I do not go as a KP only, right. So I can talk much about the structure for KP, because I do everything from putting the risk money down to the asset management. So I don't just go and sign loans for other people and then get a piece of the pie. But I have heard it, it's like 10% to 15%. I have heard other people and they're looking for KPS, they're offering 10 to 15. And I have been offered several times, but I just don't sign the loans.

Sam Wilson 12:58

Right. Right. That answers I think that answered that question very well, thanks for taking the time to kind of break that little nuance to this business down because I think people when they're scaling, they often have that question. They're like, well, you know, we could take this deal down, we understand it well enough, but maybe they're not far enough along in the business where they have that balance sheet to back it up. So go find bringing on a balance sheet partner a loan guarantor is, you know, an excellent way to take down some of these larger assets, especially early on, let's talk a little bit about the laundromat business. You and I are have this in common. And I think it's a fun again, it's a fun diversification outside of potentially real estate, but you guys have done because I know you've built some ground up. Is that right?

Kay Kay Singh 13:44

Yes.

Sam Wilson 13:45

Okay, can you tell us a little bit about the business, what you like about it, and where you see it going to backup back in 2012? When it was so I had an empty lot sitting by my gas station, somebody owned, so I decided there was a laundromat down the street, a block away. And they used to come and get quarters from us. And they were always complaining about the laundromat. Right then it took their quarters and all that stuff. So it stuck to my mind that we need a laundromat in this neighborhood and I had been in this neighborhood for 12 years where that gas station that was my first gas station. So I wanted to give something good back to the community as well. So I bought that lot and built it from ground up. And it's a card system and bigger machines. And I did one year of research before building it. So I had looked at every aspect, every equipment that is needed, and even 15 years from now. So I looked at everything and I tried to do my best to get everything in and make the customers happy and and also provide something different than what other laundromats in Fort Wayne provided. And I did that.

Sam Wilson 15:05

When you say you went to a card system, you know most people think of laundromats or putting quarters in the machines is yours only card?

Kay Kay Singh 15:13

Only card.

Sam Wilson 15:14

Interesting. So you've eliminated the need to go in and collect quarters out of all these machines every week. If you found any, we're gonna get nuanced here. But if you found any potential loss of revenue, because people come in and they want to spend quarters in the machines, are they expect to have a coin laundry?

Kay Kay Singh 15:34

No, we haven't. And I was a little skeptical in the beginning that people might not like just the court system. And it happened, a lot of people would walk to the laundromat, and then when they see all we have to have a card, they would go away. So for the very first year, I had the employees. So I trained my employees, because it was by our gas station. So I spent some time there to, to educate the customers, right, we gave them $5 for registration of the card. So if somebody walked into the store with a bunch of quarters and say, hey, oh, I have only borders and machine doesn't take orders, those machines don't take orders, they take bills, or they take credit card, our slightly take them to the gas station, I'm not saying that money into bills, and then would buy them a card and then have them register and the machine-like throws flowers and says, Hey, you have one $5 And they would be happy. And at the end of the day, they would be happy customers when they walk out of the laundromat.

Sam Wilson 16:42

Right. And that goes back to the automation thing of getting tenants to pay either digitally, or just eliminating some of those typical, you know, things that you're finding with the old school pen and paper guy you bought your first set of single-family houses from and I think that's the name of the game in this business is constantly finding innovations and inefficiencies. So when you bought some multifamily complex user management and efficiencies or 40 houses, you know, what are the inefficiencies that in problems we can solve. The other cool thing I think on those in it's the same way with the card system, it cuts out a lot of labor and risk. You know, there's cash and card games. The other thing it does, obviously, I think it gives you it gives you float, the whole gift card, you know business is a racket, people are always leaving 1, 2, 3 $4 on a card and then throwing it away. And that's just free revenue.

Kay Kay Singh 17:30

And then on top of that, you have your customer working for you for free. So they are the ones training the new customers, right? So when they walk in, they don't know what to do. So the customers will take them to the extender and show them how to get a card and everything. So they're working for you while they're there for free.

Sam Wilson 17:52

It's beautiful. It's a beautiful thing. Kay Kay, I love it. I appreciate you coming on the show today. This has been a lot of fun just hearing about your vast business experience. You know owning 40 single-family homes now being a general partner in 5500 units, owning eight gas stations, several ground-up laundromat builds I mean, you've got your hands on a lot of things and I love just the entrepreneurial spirit and the hustle that you bring to the table, certainly appreciate you coming on. If our listeners want to get in touch with you or learn more about you what is the best way to do that?

Kay Kay Singh 18:21

We have a website, the name is growtichcapital.com The name I got from here. Grow Rich Capital and I would advise your audience to read, definitely read this book. This will change your life.

Sam Wilson 18:37

I love it. Yeah, that's Think and Grow Rich. If you're listening to this, he's showing us Think and Grow Rich by Napoleon Hill. Love the fact you just borrowed the name and called it Grow Rich Capital.

Sam Wilson 18:46

Kay Kay, thank you for your time today. I do appreciate it. Look forward in here soon.

Kay Kay Singh 18:50

Thank you so much for having me, Sam.

Sam Wilson 18:52

Hey, thanks for listening to the How to Scale Commercial Real Estate Podcast. If you can do me a favor and subscribe and leave us a review on Apple Podcasts, Spotify, Google Podcasts, whatever platform it is you use to listen, if you can do that for us, that would be a fantastic help to the show. It helps us both attract new listeners as well as rank higher on those directories so appreciate you listening. Thanks so much and hope to catch you on the next episode.

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