Lawrence Fassler, JD, MBA, realtymogul.com

Listen in as Lawrence Fassler, JD, MBA, reveals what make realtymogul.com a great investment opportunity for accredited investors and why:

  • You can diversify into smaller minimum investment amounts across lots of different properties and across lots of different geographies
  • The ability of smaller investors to conveniently access deal flow enables run-of-the-mill accredited investors to invest in larger or higher-level real estate projects than were possible before
  • What is a debt offering and what are the advantages and what is an equity transaction and what are the advantages
  • What returns are typical for debt offerings and for equity transactions

Josh Mettle: Hello and welcome to the Physician Financial Success Podcast. My name is Josh Mettle, and this is the podcast dedicated to advising physicians how to avoid financial landmines. Today, we’ll be talking with Lawrence Fassler with Realty Mogul. Realty Mogul is a marketplace for accredited investors to pool money online and buy shares of pre-vetted investment opportunities.

Lawrence earned his JD and MBA from Columbia University, then went on to practice law, and eventually ran a real estate construction firm. Today, Lawrence is general counsel for Realty Mogul, and he’s here today to explain crowd funding and how Realty Mogul is working to deliver on their very simple mission statement: to make it easy for investors to invest in real estate together. Lawrence with that, welcome to the show! How are you this morning?

Lawrence Fassler: Great! Thanks very much, Josh. I’m happy to be here.

Josh Mettle: My pleasure to have you. I am just truly interested in this whole concept and I know that our listeners are going to get a lot of value out of it. Let’s just jump right in and what I’d like to maybe start with is just help us understand a little bit more what crowdfunding is, maybe how it came about, and why it might be attractive to our listeners in terms of investment vehicle.

Lawrence Fassler: Sure. Well, crowdfunding kind of started with these donation-based websites like Kickstarter and Indiegogo that were kind of raising money in a more charitable way I guess. If you had a movie trailer that you wanted to fund and get started on something, you’re not really offering an investment to people but looking for some starter money and people would donate and maybe get a copy of the trailer once made or something, but it wasn’t really an investment so to speak.

Josh Mettle: Right.

Lawrence Fassler: But that became a pretty big movement and then people started moving into crowdfunding as a real investment vehicle. This brings into play security laws and other considerations, but having said that, it still remains a really interesting proposition because people can now invest in things they wouldn’t have had access to before in areas of the country that maybe are a complete opposite end of where they reside, when it comes to real estate different property types. It’s all sorts of things that crowdfunding really gives people access to that they didn’t have access to before.

In the commercial real estate market, it’s particularly important because these were usually bigger projects. We’re talking about larger apartment complexes or retail shopping centers, office buildings that usually bring in either large institutions investing in these projects or pretty high net worth individuals who have a lot of money to throw at one particular project. Now someone we’re still limited to accredited investors, which means you have to have a net worth of $1 million or be making $200,000 a year, but even for a lot of people in that bracket, a big investment in one particular project is sometimes a little bit too big of a nut to chew on.

It’s much nicer if you can diversify into smaller minimum investment amounts across lots of different properties and across lots of different geographies. And so that’s really how we see crowdfunding as kind of democratizing real estate investment, which traditionally has probably been a little bit slower than other asset classes like stocks and bonds to divvy itself up into pieces and make it easier for people to own parts of a project.

Josh Mettle: That’s a great explanation and we were just talking a little bit about the kind of maturation maybe of this field, or this type of investment with a couple of IPOs that are happening right about the time that we’re recording this with a company called Lending Club and another one you mentioned was On Deck. I think what used to be open to hedge funds or what used to be open to big banks and they used to be kind of as you said ultra wealthy used to have the corner on this market. It feels like with this new form of crowdfunding that it’s really opening these doors that never have been available to, you know, you do have to clear the bar for accredited investors, but most of our listeners are going to clear that bar.

Lawrence Fassler: Yeah, and it really makes things so much more convenient for investors. Now through our online platform like the one provided by Realty Mogul, people can review real estate investment projects at their convenience. It’s the magic of the Internet. You can sit at your laptop or tablet computer at the kitchen table at 10 PM after the kids have been put to bed, whereas previously you kind of have to be introduced to the opportunities by your attorney or your financial advisor, if you had those connections at all. The ability of smaller investors to conveniently access deal flow has really enabled a lot of what we would say kind of run-of-the-mill accredited investors to invest in larger or higher-level real estate projects than were possible before.

On the other side for sponsors, the real estate companies that are involved in these projects, they typically wouldn’t have bothered with investors unless they are bringing a lot of money to the table. But now the way Realty Mogul structures these projects, we will pool investors together and present the sponsor with a single $1 million, $2 million investment through this entity that we set up, but that entity maybe made up of 50 or 60 different investors contributing $10,000, or $20,000, or $30,000 each. So, the sponsor works well, you’ve got one single investment that makes your life easy. You just have to produce one more tax return, and other than that, it’s not really any skin off his nose, and for the investors are gaining access to something that they just didn’t have access to before.

Josh Mettle: I think you set our next question pretty well and you’ve partially answered it, but maybe you could just give us a 30,000-foot view and make sure we’re clear on what role does Realty Mogul play. Then from there, the question that comes to my mind is I’m considering to make an investment in this sort of platform is whom are you a fiduciary to? Are you a fiduciary to both the sponsor and the investors? Explain that to us if you would.

Lawrence Fassler: Yeah. We act as kind of aggregator of individual investors and create an entity that presents itself to the sponsor as a single investor. We don’t really have any duties to the sponsor per se. We’re an investor. He has duties to us, but our duty really lies to the individual investors. We form a separate entity that we manage for the investors and that group, like I said pools all together and then that single entity invests with a sponsor.

We get compensated in two ways. We have partnered with a broker-dealer named WealthForge, and in fact I’m a registered representative of WealthForge. WealthForge gets paid by the sponsor to help organize this transaction. We charge WealthForge regular fees just for running administrative efforts on transactions that are both successful and not successful, so we get some competition from WealthForge that way. Investors we charge an ongoing asset management fee usually 1 percent or 2 percent on each project. The returns that come from the sponsor are diminished slightly because we’re taking our fee out, but generally this is all priced into the results that we – sort of pro forma projections that we present on the sides. When you see numbers that say assuming that these projects go as planned, assuming that projections are realized, and of course there’s never a guarantee on these investments, but assuming that things go well, our fees are baked into those numbers. The bottom-line of projected returns that people see are net of our fees.

Yeah. Our main role really is to organize the vehicle, get the investors in. We run background checks on the sponsors, make sure that they have a fair bit of experience in the real estate investment world already, and then, also some checks on the individual investors. Our broker-dealer partner also assists us in running identity checks, verification checks. There are securities rules against making sure that people on terrorist lists for example aren’t let in to these deals. There’s a fair bit of regulatory framework that surrounds each of these deals, but we handle that ourselves together with our broker dealer and make sure that everything is kosher.

Josh Mettle: Got it. That makes sense. Talk to us if you would just maybe what a typical deal would look like. If someone hasn’t been to your website, hasn’t seen the offerings, what types of investments are available. You’ve kind of touched on it. I understand that you could invest either as an equity or a debt partner. Just explain those differences to us if you would.

Lawrence Fassler: Yeah. We have two different lines of business essentially. One is the debt offerings where you’re essentially becoming like a bank. You’re lending money on a project. These tend to be shorter-term loans usually to individuals who are rehabbing or renovating properties what we call fix and flippers. Somebody who looks at a single-family home, that’s a little beat up or maybe he bought out of foreclosure auction and looks to fix the roof and get the heater working again before he resells it or maybe rents it out to renters. These people usually need a short-term loan to get the repairs made. They’re often not handled by banks because banks already in order to get the Federal guarantees to backstop these loans, they need the roof already fixed, so these guys typically turn to private lenders.

Our feature I guess, our distinguishing advantage is that by using a lot of technology, we’re able to really accelerate the application speed for these borrowers, really get an answer back to them fast and get the money in their hands fast. That’s the one part of the business.

Then the equity transaction is where you’re acting more as an owner of a larger commercial real estate project or part owner. These tend to be a typical transaction for us – for example would be say a $15 million strip mall on the corner. The sponsoring real estate company looks to acquire it with maybe a $10 million bank loan. He’s going to put in $1 million himself and he’s looking to raise the remaining $4 million. We will come in with maybe $1 million or $2 million of that $4 million, but again that $1 million or $2 million will be made up of 60 or 70 different individual investors coming in at $10,000, $20,000, or $30,000 each. That is kind of the typical transaction that we see.

Josh Mettle: Great! A couple of questions on those, very interesting. Let’s talk quickly about the debt structure and the scenario you gave in regards to a fix and flip. Are those typically single-family residences and you’re finding kind of professional remodel and real estate investors going in, identifying the deal, then coming to you as some sort of a pro forma, and then you’re funding the fix and flips on single-family residences. Is that how that looks?

Lawrence Fassler: Yeah. Generally. It’s not just single-family residence. We do larger commercial loans as well, maybe people rehabbing a hotel before they get it branded under one of the larger hotel franchises or so.

Josh Mettle: Got it.

Lawrence Fassler: Yeah. They typically people who have done this before, in fact, we price the loans based on their level of experience. They’ve got a certain rehab budget in mind and sometimes the nature of the loan that we give them takes into account some of that rehab budget. For example, they may not get all of the money upfront. They maybe out of a $200,000 loan, maybe $30,000 or $40,000 is held back in reserve until they get to certain stages or the construction project completed. We have some kind of controls in place on how that project is completed. The loans, the debt securities that we offer to investors actually aren’t part of the loan directly.

It’s a little bit complex, but we tend to loan it to the investor on one side and then sell to the person who’s really doing the rehab project. Get him the loan and then we sell it to investors debt securities of Realty Mogul that are related to that loan. They’re tied to the performance of that underlying loan, but people aren’t directly secured by the property. The Realty Mogul is. That’s another big distinction between debt and equity.

On the debt project, there is an underlying security on the loan that Realty Mogul makes and if a borrower really falls apart, they are at least is a property that we can foreclose on and investors have a better chance than they would in equity investments I suppose to get all their money back on those.

Josh Mettle: Yeah.

Lawrence Fassler: Certainly a more secured position.

Josh Mettle: That makes sense. What would an average cost be to that and I know you mentioned it varied based on experience, but just on average what would that cost an investor to come to Realty Mogul, wanted to buy a nice house, and in addition to costs, how much skin in the game do you usually like to see those investors put in?

Lawrence Fassler: It depends on the debt side. There’s definitely a loan to value ratio. It depends on the kind of the appraised, our assessment of what the property will be worth in an appraisal after the repairs have been completed. A loan or a certain amount against that. Yeah, the investor really has to have at least 10 percent or 20 percent in the game still.

Josh Mettle: Okay.

Lawrence Fassler: Same thing, kind of on the equity side. The sponsoring real estate company we look for to keep about 10 percent of the overall equity investment that they’re contributing and then for outside investors to pull in the remaining 80 percent, sometimes 90 percent, but yeah we really want to make sure that sponsors have a fair bit of skin in the game. Then on the debt side again, not only do they have some skin in the game in terms of the equity, the evaluation of the property, but also we hold back some of the funds until some of the construction work has been completed. They’re a bit kind of under our watch that way as well.

Josh Mettle: And so you guys in that capacity are vetting the deal to make sure that, like you said evaluations are there, you’re vetting the sponsor I guess is the word that you call it, that they have experience and this is within their wheelhouse. Then you’re actually managing the construction phase to make sure that you’re not funding too much of the construction budget before the actual work is done. Is that right?

Lawrence Fassler: Yeah. We’re not managing actively the construction, but we’re monitoring it. We have third-party service providers who keep an eye on the project, get the requisite mechanics liens, and so forth cleared from the contractors before the remaining funds are given. Yeah, there are some controls in place all along the way. Then for both borrowers and the sponsoring real estate companies and equity deals, we do background and criminal checks and make sure there’s nothing weird that going to come up that way on the equity side. In particular, both borrowers and sponsoring real estate companies for equity deals, we do a fair bit of analysis in their past experience. For the larger equity deals. In particular, we really look for sponsoring real estate companies who have done pretty significant amount of transactions already and really have a track record going because really in those deals, you’re kind of giving up control over to the sponsoring company.

You’re really trusting them to run this project well. The way these are structured usually is that most of their compensation comes in on the back end anyway. They have to make sure that the project really does perform in order for them to gain most of their projected compensation.

There’s some controls in place that way, but we try to vet these people pretty well up front as well. That’s one of the primary services that we offer investors, is really kind of being an intermediary that really kind of pre-reviews these projects with a close eye. Frankly, we probably only put up on the website I would say for equity deal in particular, but probably on debt as well probably only about 5 percent of the projects that get brought to us. We’re pretty particular.

Again, there is no guarantee. Just because we review the properties doesn’t mean that everything is going to go perfectly. Investors are still encouraged to do their own diligence of course. Part of what we offer as well is to put out the pertinent factors of each investment there on the website. You can review the specifics about the property, about the demographics of the neighborhood that the property is located in, the management team of the sponsor that’s running this, the way in which the investment is structured. All of that is laid out pretty well for people, as well as pro forma projection of it that gives people an idea of the assumptions being used and how the projections are really structured.

Josh Mettle: Very interesting, very interesting. Okay. Now on the equity side, you gave an example of a $15-million strip mall. In that particular scenario, they were coming in with a $1 million of their own skin in the game. They were going to do a $10 million loan, so we needed to raise somewhere around $4 million in additional cash or equity for that transaction. In that scenario, you’re actually owning a percentage of ownership based on, I would assume, the amount that you have invested and you would be one of many partners that are holding this in like a limited liability corporation or a limited partnership or what is the entity structure.

Lawrence Fassler: Right. Usually sponsors form their own LLC, a limited liability company and sometimes a limited partnership, but they set up a separate vehicle in which to hold the property and we are just another investor in that company’s LLC, in that company’s shares. In this respect, it’s really no different than the syndicated projects have been done forever. For time immemorial, people divided up the amount of ownership that goes into a particular project. As I said before, the sponsors would go to their network of previous investors or run to the country club and see who they could round up. Now we are coming in as another large investor, but we kind of do the work for the sponsors.

Josh Mettle: Yeah.

Lawrence Fassler: And our job really is to go out to individual investors and make sure that they’re aware of the transaction and try to garner some interest in it. But then, once we raise the funds for the sponsor, it’s just like we’re another investor, albeit a larger one, that comes in and works along the usual structure for him. There are some deals where we end up being kind of the majority partner or take up almost all of the equity that the sponsor is trying to raise. In those situations, we ask for a few more control rights. We have a little bit more say in how the property is run, but in general, we’re again kind of funding into a transaction that’s pretty standard, pretty conventional. We’re just doing it in a different way. We’re kind of sub-syndicating out a piece of that sponsor’s equity.

Josh Mettle: Yeah. Basically let’s say the scenario where there was $5 million in cash that needed to be raised for this project, and let’s say I came in with $500,000. Would that mean that I would have a 10 percent ownership in the entire ownership of the property? Is that about right or does that get diluted somehow?

Lawrence Fassler: No, that’s about right. The only difference is if you came in as a part of the Realty Mogul entity, strictly speaking you would own part of the Realty Mogul entity‑

Josh Mettle: Right.

Lawrence Fassler: Which itself would own part of the sponsor’s entity.

Josh Mettle: Right.

Lawrence Fassler: Yeah, generally speaking, that’s about right. The one other caveat is that sometimes if these projects really go south and the sponsors find themselves looking for more money, he’ll sometimes look out to investors to raise a little bit more to get past that roof that now needs fixing, and so forth. We usually put sponsor s on notice that we won’t contribute to capital calls. It’s just a little too difficult to run out to 40 or 50 investors and look for more money after they thought the deal was done. The downside there is that we might be diluted if someone else comes in to contribute a little additional capital, but we’ll see. That situation just hasn’t come up for us yet frankly. Usually the sponsors are pretty good in their planning up front. There’s a pretty big reserve that they hold out for emergencies like that in the amount of funds that they raise at the outset and so far, keep your fingers crossed, but that kind of situation hasn’t come up for us.

Josh Mettle: Yeah. Well that makes sense. That means that you’re vetting good deal. We talked about debt. We talked about equity, and I imagine there is some tax advantages to the equity side, but maybe I could just let you expound on the differences between equity and debt, and maybe what some of the advantages both would be.

Lawrence Fassler: Yeah. On debts of course, you’re in a slightly better position. You’re in the capital stack as we say, of how funds are financing the property are structured. The debt of course have kind of a premier position or the first lien position on the property. If things go south, there is always foreclosure that can be turned to, and hopefully, most or all of the money can be recovered by a sale of the property.

There’s no real tax advantage if you’re still on debt. You get a 1099 for the interest payments that you receive similar to those you would receive for a bond or some other interest-based investment. On the equity side though, there really are advantages to real estate that aren’t there in most other investment types. The depreciation deductions that are available in an ownership position in real estate are pretty substantial. We also get to deduct as interest expense the interest that is being paid on the bank loan on the property.

What we find, and I had some experience with this just from a rental property that I owned personally for a while, is that your depreciation, the deductions, and the interest rate deductions essentially offset at the outset all or most, anyway, of the income that you’re realizing. You’ll get distributions coming in for the performance of the property, but no taxable income at the outset. It’s not really a tax shelter. It’s tax deferral. A lot of this will get recaptured when the property gets sold but generally at rates that are lower than ordinary income rates. In the meantime, you’ll have use of the cash to the amount that it was deferred at the outset. In that sense, real estate is a pretty attractive investment option.

The interesting thing with crowdfunding, at least when you structure it like we do through an LLC entity or another what they call pass-through entity is that all these tax benefits are passed right through directly to investors. If you invest in a REIT or some other structure, there are some advantages. They’re structured a little bit differently though, and you don’t really get the entire benefit package of all these depreciation deductions and so forth that you do have when you participate in what we call one of the direct participation vehicles. That’s really a pretty strong benefit to real estate investing generally and some a good reason to consider this asset class vehicle.

Josh Mettle: Yeah. You touched on it and summarized it well, but we may just take a step back and talk about you know I really see there’s four advantages in investing in real estate. Number 1 being your cash flow. That’s the number 1 reason to invest in real estate is you’re going to get a monthly annualized return. You’re going to be in the positive, but you also have your appreciation, and that’s what might happen to the property over, I don’t know how long these cycles usually go. Maybe you could speak to that, but over 5 to 10 years, we’re going to see some appreciation. How long is the typical cycle on the equity side?

Lawrence Fassler: Yeah. The typical hold period for the equity investments we have is I would say it’s about 5 years. Sometimes we get 3 years, sometimes7 years, but it’s typically around 5 years. Now that can be plus or minus a little bit. That depends on what the state of the economy is at the end of that 5-year period. Maybe it’s not the perfect time to sell, so maybe we’ll hold on to it for another year or so. But yeah, there’s definitely a hold period and that’s one of the things that investors have to realize. These tend to be relatively illiquid investments, so it’s a stock or a bond that you can freely trade. Once you’re in, you’re in for a while, so you really need to make sure that that’s money that you can afford to set aside for a little while.

But having said that, you’re right. Realty is pretty interesting in that respect that its investments, it could produce a fair bit of current income as well as the appreciation. Stocks, unless you’re getting a dividend heavy producing stock, you’re really more looking for value changes, an appreciation or the movement of the stock generally. In real estate even if there is no appreciation, you’re getting cash flow that whole time – the rent. Part of what was modeled into the investment initially and what you subtract all of the expenses and all of the things – the net operating income, the cash flow that can come through to investors tends to be pretty steady. There’s probably a higher proportion of the overall real estate investment that is there in the form of cash flow.

I guess some other advantages of commercial real estate also because of that income component, it’s often seen as somewhat less volatile than stocks or other asset classes just because the income component doesn’t just drop away unless all the tenants leave or there’s a huge disaster. But the value of the project is a little more stable in many cases because of that ongoing income component.

Real estate is also a hard asset. It’s something that you can see, that you can go, drive by, and kick the walls if it’s in your neighborhood. Many people also see it as a pretty strong hedge against inflation because the rents often rise along with wages and other increases in prices across the country when there is inflation. Real estate tends to move in concert. There’s different degrees of how well that works, but it tends to correlate to be a better hedge against inflation than a lot of other asset classes.

Finally, there is the diversification component of real estate, too. It just tends to move a little bit differently than stocks and bonds. A drop in the stock market doesn’t necessarily correlate to a fall in real estate. Having said that, of course the great recession, that was the downside of real estate, but a lot of times, the worst of these events tend to happen in the single-family home market where people are just deciding not to buy homes any further. In the commercial real estate market, because of the income component, I think the volatility is somewhat reduced. Again, past performance is not a predictor of future results, and we have to qualify all of those statements, but I think a lot of studies are out there showing the volatility of real estate is somewhat less than a lot of other asset classes.

Josh Mettle: I can hear the general counsel coming out of you, Lawrence. I appreciate that. Well, may I just say one other thing on that when you’re staring at your stock account daily and it’s going down, and it’s going down, you know one’s own worst enemy is thyself. You end up just capitulating and saying I can’t take it anymore. I can’t look at my stock account one more time and see I’ve lost another percent, and so you sell and you bail at the wrong time.

Lawrence Fassler: Right.

Josh Mettle: There was a recent study done that individual investors even during a period of 10 percent or 12 percent S&P market gains were only yielding 3 percent to 4 percent. The reason is they bought the wrong assets at the wrong time and bailed at the wrong time, so they bought high and they sold low. The nice thing about real estate is you’re not reappraising every day, and that doesn’t get sent to your phone. The only thing that you know is, “Great. I got an update of my quarterly or annual review. The pictures look good. Grass is green. Vacancies look good, and here’s my check.” And so, you don’t as much fall into the worst enemy scenario of just selling out of fear.

Lawrence Fassler: It’s true. I mean illiquidity has its upsides as well.

Josh Mettle: Absolutely.

Lawrence Fassler: You’re really focused on staying that investment, riding it through, and the good thing is yeah over time, usually you can ride it through. Then as the market turns, value usually goes back to its normal trend. Yeah. As part of the updates that you mentioned, one of the things that Realty Mogul really offers is a pretty interesting investor dashboard where all the earnings from the property, all the updates, any news about the property if there is good news, bad news whatever, we tend to shoot that out to investors straightaway.

At least on a quarterly basis and sometimes more often, you’ll get an update. Certainly when distribution is coming through, you’ll get an update. You’re notified every time by email. Tax returns, all of those are posted to your account. You really get kind of monthly statements resembling what you would from any other investment house, Charles Schwab or anything else, so you’ve got all the materials there. It’s just that it’s presented to you a lot more conveniently. You pick up your laptop and look at it whenever you want and again if you do that at 10 o’clock at night if that’s the time when it’s most convenient for you to focus on your investments, if that’s what works for you and all that information is online available whenever you want.

Josh Mettle: I think it was Warren Buffett that said he prefers the investment speed of a sloth. What he meant by that was you know get it on the deal and if it’s creating cash flow and growing in value and the cash flow keeps going up every year, then just go back to saving and find the next deal. You don’t need to trade in and out of it. I think there’s really something to be said for that.

Lawrence, I always know it’s a good interview man when I look down and we’re over time and I’ve got like five more questions for you. I’m just going to cherry pick one because you know as an investor myself, what I want to know is tell me what a typical return might look like. I know you’ve got to get the legal disclaimer that past performance is not indicative of future results, but what in the past have folks expected as an investor, both on the debt side and on the equity side.

Lawrence Fassler: I would say on the debt side, our typical loans or debt securities are structured in with interest rates in the 8 percent to 10 percent range, about 7 percent to 10 percent, so it’s somewhere in that range. Again, these are kind of short-term loans to borrowers who don’t normally have access to traditional bank channels because it is a renovation that’s underway. That explains why interest rates are a little bit higher than you might see for a conventional mortgage for example.

Josh Mettle: Sure.

Lawrence Fassler: On the equity investments, we tend to look for projects that are going to or at least projected to have what we call a cash-on-cash return, which is the distributions that come out on quarterly basis; also I guess in the 8 percent to 10 percent annual range. Again, these are equity investments, so the likelihood of those returns are somewhat less than what they would be in a debt investment where really that’s the first thing that has to be paid by a real estate investor. But we tend to look both for cash-on-cash returns in the 8 percent to 10 percent range and then overall what we call IRR, the internal rate of return, which calculate not only the distributions that you’re getting paid on a quarterly basis, but also the gain when the property is sold, the appreciation that is realized.

For the IRRs, we try to aim for projects that look to have projected numbers in the mid teens, so hopefully if you hold on to the project during its first entire life of the 5 or whatever hold period that’s projected, you’re gaining somewhere in the range of 15 percent, 17 percent somewhere in that range. Maybe a little less, maybe a little more but at least what we’re aiming for. Again, like you said nothing is guaranteed. We don’t know if the returns are really going to match what’s projected, but that’s what we aim for.

We tend to really kind of do somewhat we call stress testing on the projections that sponsors present to us. You know tweak a few number this way, tweak a few that way, see how the returns are affected and get pretty comfortable that these projections are doable at least.

Josh Mettle: Well, Lawrence, I would advise our listeners to check out your website, which is realtymogul.com. If they have any other questions for you or they want to just really dive into this thing with further specificity, how do they get a hold of you and what’s the best way to find out more?

Lawrence Fassler: You can get a hold of me directly through my email, which is lawrence@realtymogul.com. People are also encouraged to look at the education center on our website. There’s a lot of blogs and articles that really run through just about every aspect of real estate from different property types to different structures to the tax benefits of real estate. There’s a lot of material on there that will help you get a little more comfortable I guess with crowdfunding generally and real estate as an asset class. Yeah. We encourage people to do as much vetting as they can before so that they make an educated investment choice when the time comes.

Josh Mettle: Lawrence, thanks so much for sharing so generously with our listeners. I learned a lot. It was a pleasure speaking with you, and I certainly look forward to connecting with you again soon.

Lawrence Fassler: Thank you very much, Josh. I appreciate it.