Laurel Simmons: Welcome everyone to another episode of the REITE Club podcast. I'm Laurel Simmons, a co-founder of the REITE Club, and I'm joined today by Katherine Nelson Riley, our wonderful operations manager. Hi Katherine.
Katherine Nelson-Riley: Hey Laurel. I'm really excited about having a chat and a catch up with Steve. He'd brings so much energy into the room whenever you need it.
Laurel Simmons: He really does, and he's just enthusiastic. He's a nice guy and he's so enthusiastic about what he does isn't he?
Katherine Nelson-Riley: He really is. And you know what's interesting is he actually, he's got this background that was in the residential and commercial construction industry. So he really has quite a wide diversification of talents and expertise. But what his main focus now is on a passive and private equity investment opportunities and it. I'm really looking forward to this so that I can really learn the difference between passive and being more proactive and what he has to say and what they have to offer in educating us.
Laurel Simmons: Yeah, I think there's a, there's just so much out there in terms of investment vehicles, investment opportunities, and this is just another way in private equity, real estate investment and other types of private equity investment to make your money grow and to create more wealth. And like we talked about in the episode, not, there's no one size that fits all.
Katherine Nelson-Riley: Of course. There's so many different people with different unique situations. The nice thing about Steve that I really respect, and we've known him for the REITE Club is coming up on its sixth anniversary, and Steve has been a part of the REITE club for almost the entire six years. But one of the things that he really does is he focuses on relationship development and making sure that it's a good fit. Everything is fit for the people, which is really quite commendable.
Laurel Simmons: Yeah, exactly. I've always liked Steve, so I think we should go to the episode, don't you?
Katherine Nelson-Riley: Absolutely.
Laurel Simmons: Hello Steve Blasiak. It's been a while since you've been on our podcast. It's great to see you back here.
Steve Blasiak: Thank you so much for the invitation. I was so excited when I saw the email requesting this little interaction, and I am very excited I missed you guys tremendously. I know how very popular you guys have got, you're coast to coast now. Congratulations, and I really want to get back in and help support whatever we're doing here.
Laurel Simmons: Let's start off, let's ask the really tough question here, Steve. You're in a private equity investing, right? So let's just go right to it. It's now or past Covid. The real estate market has changed a lot. What's it like out there in the world of private real estate investing and equity investing, because that's what you do. So give us the behind the scenes look here at what's going on.
Steve Blasiak: I think the biggest change is that I find that more and more people are realizing that they can take part of their portfolio and invest into private passive real estate investments. Why is that important? People who are excellent at real estate and have a huge portfolio of real estate, they need a little bit of diversion perhaps away from their real estate portfolio, away from real estate in general. And we have funds that have nothing to do with real estate and a diversion away from real estate.
I think that more and more people are realizing. Passive investments is an excellent part of one's portfolio. Even if you're tremendously successful with your real estate portfolio, you still need some diversification, and that's exactly what this is. It's a passive way to invest your RSP or cash, your tax-free savings account into what you know and love Beth's real estate or diversification out of real estate. That's what's been going on.
Laurel Simmons: Are you busier than you have been saying? Lemme rephrase the question over the C words. I don't even wanna say the word code anyway. Did you find that things got busier for you? What was the shift that happened during that period and then moving past it?
Steve Blasiak: That is such an excellent question because in reality, in the big picture, that sounds weird, but I've actually more than doubled my sales during the C word during Covid. And how was that? Because Ontario Securities Commission, which oversees what we do prior to COVID. They had us sit down face to face with each and every single one of our clients.
Unfortunately for me, I couldn't just do a one sitting and selling and going to the next client. Typically it takes me at least three minimum three appointments to sit with somebody, explain what this private equity is, what's passive investing how do I get paid? What's their access strategy? Give 'em all the terms and then finally sign the paperwork and get it registered and have the the investment start.
That all took three, at least three appointments. Whereas of course, what are we doing? We're zooming and while I'm zooming, dinner's getting cooked downstairs, so we'll, multitasking. Not only could I meet 10 clients in a day, but also e-signatures. They, believe it or not, the securities commission just started allowing e-signatures in 2020. So now I can DocuSign all my documents with people that I don't have to necessarily sit with face-to face.
Laurel Simmons: Yeah, I think that made a huge difference. Like all of a sudden you didn't have to go into a lawyer's office.
Steve Blasiak: Exactly. Or whatever. Exactly. Actually it was pretty scary in the beginning, eh, who wanted a venture outside with this crazy thing floating around called Covid. I was really comfortable and working from my little workspace here and then I grew to appreciate it and use it more as a tool. And like I said and since everybody had that mindset, it was much easier to see 10 clients a day as opposed to one or two clients a day.
That's really the big thing that helped during COVID was to speed things up. But you still. Have to have the trust if you are gonna give me a hundred thousand dollars to invest into that apartment building, we still have to gain some sort of a trust. And that is always the tricky part with this Zoom and emails and texts and stuff like that.
I know I'm going down a huge rabbit hole there, but that's for a different day. How do you do that? But here we are. We're doing it. Business is doing extremely well. And like I said, when people just understand that a small portion of their portfolio fits perfectly with private equity and this passive investment space, then more and more people are opening up their investment portfolios and get their, the pieces invested here.
Laurel Simmons: Can you give us an example of a project? You don't have good specifics. I think people would like to know because we hear these terms banding around, oh, it's private, equity investment and this and that, and I'm in this fund and that fund, and I don't think people really understand. What it is. So could you give us an example of, what someone. Could get involved with if they decided to take that route?
Steve Blasiak: Sure, absolutely. First and foremost, I think because private equity is a big box, right? We have people who are on this podcast listening that do private mortgages or private investments or joint ventures, or put their money in with, five or 10 other people and buy apartment buildings.
That's all considered private equity. But the space. I'm referring to the space that I represent. I have a license from Ontario Securities Commission to go out and to talk to people about these certain investments that we have on the Pinnacle Shelf. So that's the biggest differentiator between private equity and just what is a public or just an ordinary investment.
As an example one of our one of the companies that we're raising money for, it's called, and a lot of REITE Club knows about nationwide self storage and Carwash because I've been talking about this for, since, I don't know, 2015,2016 or 2017 since you and I got together. And it's still, we're still raising money for, actually this is the sixth project that we're raising money for.
What is private equity in this space here? So we have Shane Doyle, who is a nationwide the CEO, and his dream, his idea is to find land that's already zoned for self storage and or car washes in basically in British Columbia. So Vancouver, Coquitlam Surry, all those burrows of Vancouver.
He's looking for these, the sweet spots that will allow for self storage and car washes. And he finds a spot. He buys it it's already zoned, which is suite, and then from the zoning then he puts in the site plan for approval. He gets approval, pulls the permits, and then starts the construction and completes a construction, opens up the car wash, self storage, runs it for a several years, and then sells the project.
What part would the investors be involved in? There's an initial raise of whatever, 25 million or whatever it would take to buy the land and build the building and get the business up and running. So let's call it $25 million. So as investors would hear this idea. Think, Hey, yeah, self storage, car wash.
That's like the Gusta Golden they laid the golden egg. I want in on that project. You do your homework, your research. I give you the information all about the project. And then once you feel comfortable and you're ready to invest either using cash, RSP, money, tax-free, money lira, whatever, registered money, then I make sure that all the paperworks on.
Across ISR Dotted and you e-sign all the paperwork, transfer the money over to Nationwide. And your investment begins. I hope I didn't run through that too quickly, and if I did for anybody at home I apologize. But there is a process is what I'm trying to say. And if you're curious about the process, I can go through that much slower for us.
Generally speaking, that's a private equity investment that it's overseen by Ontario Securities Commission. The investment plus it's overseen by Pinnacle, by our compliance department. So we're making sure that we've done de-risking as much as possible. We put a private a board of director on the board at national nationwide.
That he can now or she can report back to us and let us know what's going on inside the investment. So we are making sure the investment is best possible position for clients to make their money and be very successful in this investment.
Laurel Simmons: Is that the way it works normally with all the projects that you have more than that, right obviously.
Steve Blasiak: Yes. The lovely thing about what we have on our shelf is that currently there's about 22 projects on our shelf that we're raising money for. And I have to say that there's not one project the same. So every project has its own little quirk. For instance, I have clients that are saying, okay, Steve I want this money to create an income for me to live initially as an income stream.
I wanna live off this. So that would be a different investment than the nationwide, which typically doesn't pay any distributions until the building's built two to three years later. So you could see the difference between, oh, I need money right now to live off of, or no, I can wait for three to four years before I see my growth and then I'll reap the benefits.
It's my job to sit with each and every investor and to say, okay, what are you specifically looking for? What hole can we fill that what needs can we fill that, that you would need this money? To work for you? Is it a growth? Is it a growth and income? Is it just simply income? Is it liquidity you're looking for?
If you're looking for instant liquidity, we have investments like that as well. So it really just depends on the conversation that myself and the client have and identifying the client's needs. And then me figuring out which of the 22 different funds would suit that client the best.
Laurel Simmons: I guess after you speak to your clients, potential clients. And you figure out what their risk. What do you call it? Not a risk analysis, but what they're comfortable with. And you also, I'm sure, talk about, their return on investment, right? Because that's an important part of it.
Steve Blasiak: Yes. Some people are just not happy with 7%, 8% returns. So I have to, crank it up and talk about, greater returns. And it's funny because a lot of people think, okay, bigger return, meaning greater risk. And that is a hundred percent true, but let's define what the word risk means in this case here, simply.
Risk means iliquidity. Your money is not liquid. So if you, God forbid, are in a three year, or sorry, in a five year investment, and let's say you're in year three and you go, my goodness, I need my money out. It's not easy. It takes time and there are slight penalties to get your money out early. And each individual investment is different, okay.
With like this. So some investments, there is easy outs other investments, they're difficult outs. But again, this is all what we have to discuss prior for you putting your money into an investment so you understand the entire parameter of your investment, including access strategies, early redemptions returns is very important.
All the important information about that investment. So there's term sheets and there's presentations. There's an official document called the offering memorandum, which is the playbook of how that exact investment works. So all these you have as much information as you need to make your decision whether this is right for me, this feels right, and I can invest.
And sleep at night. I think that's the most important thing, is when you make your investment, you wanna just say, okay, for five years, I've forgotten about that. I'm, Steve will call me every once a year to make sure we're on track with that investment. But I don't wanna look at that money for five years until it's over and done with. That's the kind of investment that I like to get to that space with my clients
Laurel Simmons: I can imagine I can just see people listening to this and some of them are rolling their eyes and going, oh yeah, that's great if you've got a hundred thousand or 200,000 or 500,000 or a million dollars, but I've only got like $25,000. Or, those are real questions. That's where people's heads are.
Steve Blasiak: Laurel that's I'm really glad you brought that up because I've just landed I'm closing a deal for my client's kid. So my client's children who are now in their early twenties, they get birthday money, you get extra money, you get Christmas money, and all of a sudden before, you know what, this 20 year old has got like $30,000 cash sitting in his bank.
The parents said Jim, why don't you go talk to Steve And for $5,000 I've taken a piece of their investment. And I've banged it in young Jim's head to say, you will not see this $5,000 for five years. Forget that you own this $5,000. We are gonna make it grow, but you don't want it. You're not gonna go out and buy a house with this in within five years.
The answer is no. I want to grow my money. And that's great. Take that $5,000 and invest it. Again, different mindset, different people. I've got my 91 year old aunt on the other side of the scale who's living off of these investments. Every month she gets, a money deposited into her account from these investments, and she's on a total income play there. So we've got everybody in between. My young friend, and my 91 year old aunt that, that needs daily or monthly income.
Laurel Simmons: There's a lot of variables I can see. And it takes time, doesn't it to figure out what each person's situation is. Cause everybody's different. Everybody has different requirements, desires, fears Different jobs, all kinds of things.
Steve Blasiak: Laurel, the biggest person that had to learn what you've just said was me. I was the one that wanted to do everything super fast, right? Here's $5,000, make it $10,000 tomorrow. Come on, let's go. Oh boy. The biggest thing I learned was just relax and, understand your investment inside out and backwards and realize that it time is the biggest factor you got going for you.
My sons have invested and they're 30 and 33 and they've invested in this and they know they take that $10,000 that you gave pop. Forget it. Let it grow. And then three to five years from now, that 10 is whatever it is it to be invested, but you're, he hit the nail in the head. And I'm the biggest learner of that lesson, just to relax, let time work on with my interests per year. And we are gonna, I'm gonna do well.
Laurel Simmons: Do people ever say to you that's great, but I want to I really want my own house. I really want my own properties. There's not my own house. And it's no I guess there comes a point as with anything, right? You just, you gotta walk away.
Steve Blasiak: You mean me as a in terms of advisor.
Laurel Simmons: That's just human nature.
Steve Blasiak: A hundred percent. And I have to admit, I'll be the first to admit that these passive investments may not be for everybody. Maybe somebody wants to be a hundred percent on top of what they're investing into, and they don't want to consider handing their money over to another entrepreneur who's got another excellent idea, who can then take your money and everybody earns money from that investment. But that's fine.
I'm not trying to change the world. All I'm trying to do is plant one seed at a time. So how many people do we have on this podcast today? How many seeds I'm planting, right? And hopefully they're true people are curious enough to say, yeah, what Steve was talking about makes sense. Let's understand a little bit more about passive investing, and hopefully they'll pick up the phone or email me or find me somehow and let's just have a coffee and a discussion. That's our next step.
Laurel Simmons: Yeah. I can see that. So when you were, you have been a real estate investor and you've got, had portfolios and I think now you're more in the, you take your own advice.
Steve Blasiak: Definitely put my money where my mouth is.
Laurel Simmons: Makes sense. I'd be somewhat worried if you didn't.
Steve Blasiak: Good point.
Laurel Simmons: Think that's really important. That you are also invested in these funds and that there's so many things to go and it is, it's real estate, in your case, real estate investments. But is it all real estate investments? That's why I guess.
Steve Blasiak: Correct. Because we are trying to diversify people anyway, they need dif diversifying. So some people love real estate and understand real estate upside down and backwards and only want, okay, for now just gimme this real estate REIT or real estate investment trust and that's fine.
Yes I'd have to say about half of the 22 like about 11 or 12 of our real estate, our investments on our shelf are real estate based. It's interesting and I find it's very easy to talk to. Very easy to understand. I'm gonna give you $10,000 and collectively we're gonna go buy that apartment building.
Perfect. Easy to understand. Explain. I have other investments that are diversification away from real estate that are in more in depth. You need more understanding. We need more time to explain it. You need more of an open mind to say, wow, okay, I'm gonna put my money, with this person and he's gonna do this with this, and this is his track record and, whatever.
There's many different, this is to talk about if anybody's interested and again I won't bother getting into in examples, I'll give you a quick example. For instance I got a company that is buying dental offices, right? Again you own the equipment. You own the clients, the backend and it's very sticky business.
It's extremely predictable how much money this one particular office is bringing in. It's very profitable too. And so it's a fund. Continues to buy more and more dental offices. They reduced the cost because there's less backend with only one backend office taking care of all the finances and appointments and all that sort of stuff. So they save on the backend. And anyway it's a non real estate investment to invest into these dental offices.
Laurel Simmons: That's really interesting because I know people who have bought the property the real estate property and have also bought the business. That is in that property. And that's a whole different world.
Steve Blasiak: It's two different worlds, right? When you're investing in the business is one thing, and then you're investing in the real estate where that business is located. That's something totally separate. And I think that's a brilliant move. If you can, afford to do that by both, but yeah. And we have companies that are doing it. Like for instance, the nationwide is a good example of a company buying the real estate and then creating the businesses on in that on that property. It's not only does the real estate go up, but also the businesses are, 10 time, 15 time multiple of profits. So both aspects are firing on all cylinders when it comes to selling that asset.
Laurel Simmons: I guess I have to guess the question then. That's one way of doing it. You buy the land first, and then you develop whatever it is you need to develop and then have the business go in, but to actually go after a business, like for example, like you say, the dental offices, that's a different approach. That's a different strategy. Because now you're looking at the business first. And the real estate second it because you need.
Steve Blasiak: They're actually not buying the real estate. So they've got a lease for the real estate for this office for the next 20 years. This dental office has got a lease set up, so nothing to do with the property. These, this company is simply buying dental offices because they see the huge potential in clients, right?
When you've gotta clean your teeth, you're not shopping around and calling three different dentists saying, Hey, how much you gonna charge me? You just go to your dentist. So it's a very predictable and profitable business. So that's all this fund is looking at is the sticky revenue that is created from this particular dentist's.
Then they buy, two more, three more. Today they're at 28 dental offices. So you can imagine the revenue flow with one back office running 28 dental offices. It's extremely profitable.
Laurel Simmons: Wow. There's so many ways to invest, right? There's so many things to invest in. And there's so much to learn. And we could talk all evening about this, Steve. However, it is now time for the lightning round. Where you're put on the hot seat. We grill you.
Steve Blasiak: All right. I love it. Bring it on.
Laurel Simmons: I don't think it's quite that hard, is it?
Katherine Nelson-Riley: Not at all. It's easy peasy. All right, so starting off with a lightning round question, Steve. You've got over 30 years of accumulated experience in a background that's immersed in residential and commercial construction industry. Within that residential and commercial construction industry, what is the one piece of advice that has carried you through your life?
Steve Blasiak: Oh yeah, just to simply be open. I was never stuck in the mud where I had to be a carpenter or I had to do it this way or that way. I definitely would roll with the punches and that's why I wore so many hats in my previous life, and I've done so many things that gave me a sort of a huge.
Experience, like a concrete foundation of experience just being open to okay, what's next? That's how I got in this business for heaven's sakes. Quick story, when I was turning 50 and I looked at, thank you. But I lo I looked at my portfolio and I was going, you know what?
I'm not gonna retire on that portfolio. I'm worried. And that's how I started looking into where I want to grow my own portfolio here RSPs Liras Cash Tax-Free savings Accounts, and found, I discovered the private equity space. So that's my quick story of how, by being open and curious, found this wonderful space that, I fit into so well.
I love all the different aspects of private equity, investing, finding out about the investments, hanging with like-minded people like you, beautiful people this is all by being just an.
Laurel Simmons: Okay, good. All right. Here's one. Now I wanna take you back to when you were 18 years old. If you can remember that, I'm sure. So here's the question. If you could go back in time and tell your 18 year old self something, what would you say to that 18 year old Steve?
Steve Blasiak: That is such a deep question. Cause I think about this often. think I squandered a lot of on my youth, which it's not a plan of words, it's just, I was so naive and so full of energy that I never really took a lot of time to smell the roses and really stop and think about where I'm going and how I'm doing it. And so I would say young Steven, just slow down and be more on, be more curious, be more questionable and don't jump off that cliff. I'm kidding. I never did.
Katherine Nelson-Riley: I love it. So we're gonna take you from your 18 year old self to what is your favorite resource for real estate investing.
Steve Blasiak: Oh, my favorite resource. Now you're really putting me in a little corner cause I look at favorite resources as spokes in a wheel. So there really isn't one source, although I have to say I do love the REITE Club and Laurel, I mean that from the bottom of my heart. I've been with you guys from almost the beginning. And I love what you do and what you spread. So you're definitely up there with my favorite resources.
Speaking of resources, there's just so many different places to go and things to do and experiences to learn about real estate. That I'd have to say be again, just plug away here, plug away there. The internet is crazy with ideas people to talk to and LinkedIn and zooms and Googles and searches and whatever.
That's where my brain. I think of the spokes of a wheel and don't focus on one, but hit as many as you can and find out which one feels the best and continue with that one, or two or three.
Laurel Simmons: All right, question number four. Here's the last one. Okay. I'm gonna ask you then, if you had to choose, would it be a business book you'd like to read or a non-business book? A fiction book? And if, depending on what it is, what would, what do you like to read?
Steve Blasiak: Oh, I'm definitely into biographies. I love reading about people, especially successes. I just finished the Elon Musk book and Harry Prince Harry was the other book that I just read. And I don't know, I just, I can almost live like riston through them, as I'm flipping through the pages and their struggle and how they had to focus and the determination and. Absolutely adore that. So yeah, if actually if you look behind me, I've got a bunch of them right here. If anybody wants to come to the Stevie library, gimme a call. It is, they're up there.
Laurel Simmons: If you're if you're not watching this and cause we, Katherine and I can see Steve's library behind him. But yeah, there's a lot of books there and and good for you cause. I think there's just a study that came out that said proved that the biggest thing that you could do for your children to ensure that they had a a successful live arts, however you define success was to get them to read. And there was just no question. And it had nothing to do with your socioeconomic class. If you got kids to read, it made such a difference in their lives. So there you go. Rating is great.
Steve Blasiak: Thank you.
Laurel Simmons: All right, Steve. Thank you very much. Where can people reach you?
Steve Blasiak: Cell phone. I love text serve or phone calls, so I'll start with that. 4164643085. Is myself. And then the email, which is a long one, which probably people won't get. So I just say, call Katherine. She'll give you my contact. That's the easiest way. Cause who spells Blasiak? That's my last name. It's not a Zed either. It's an BLASIAK. But anyway, I have a beautiful email address steve.blasiakpinnaclewealth.ca. But like I said if you're looking for me, And I will definitely be at the sixth anniversary. Are we on sixth or seven? Or 10?
Laurel Simmons: We're on six.
Steve Blasiak: It feels like 10. That's all I can say. But I'm looking forward to being there with everybody and hopefully we'll have some more cake like we did last time.
Katherine Nelson-Riley: It's already ordered.
Steve Blasiak: There you go. Alright. I love it.
Laurel Simmons: All right. Thank you very much, Steve. It was great to catch up with you and I think it was time to talk about this again because we all get in our own little narrow places and we don't think about the bigger picture sometimes. So that was great. Thank you very much.
Steve Blasiak: I still don't think I'm a good zoomer. On Zoom but I hope everybody was okay and entertained and looking forward to connecting in person with everybody. That would be my dream and my goal, and thank you for setting it up Katherine and Laurel, excellent questions. Thank you.
Katherine Nelson-Riley: Thank you very much, steve.
Laurel Simmons: Katherine, I think it's great that you don't need that 50,000 or 100,000 or 500,000 or even, heaven forbid, $1 million to invest, right? Steve was talking about $5,000. A young kid, 20 year old can start, and I think that's really great. So often I get people saying to me I don't have any money. I have a few thousand dollars, but that's, I can't do anything with it. Yeah, actually you can.
Katherine Nelson-Riley: Absolutely. It was really interesting cause Steve provided all the different examples and the different scenarios and I really feel that I have a much better understanding of different options and I'm really looking forward to furthering some conversation with him just for my own investment.
Laurel Simmons: Exactly. Okay. Then we'll wrap things up here, but before we go, everyone, if you would like to give us some pod love, we would really appreciate that. Know. Rate us on whatever platform you're listening. That would be great. Don't forget to go to thereiteclub.com and check out our events, our podcasts join us.
There's all kinds of content there for you to watch and read and look at. And it's, there's so much there. Hundreds and hundreds of hours Katherine?
Katherine Nelson-Riley: Absolutely. It really is. And we're one stop. Plus it's complimentary. It's that's great. And we are national across Canada and beyond which is great. So thank you so much. Great. Great podcast today.
Laurel Simmons: Okay, everyone just before we go, we'll just say, come grow with us and customize your life. Until next time. Bye for now.
Katherine Nelson-Riley: Bye-bye everybody.
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