Innovative REI Development Company Turns North Philly Property into Temple Area Gem
Two of our most innovative and successful borrowers at Rehab Financial Group are adding value to distressed properties very profitably using a unique blend of cutting-edge technology and strong partnerships.
As cofounders of Bloyd Street Capital, Brian Grimes and Travis Robert-Ritter have been perfecting their REI methods for several years. They have an agile, reliable team in place and know how to find the best properties for their business to rehab and improve. Combined with strong lender relationships and the efficiency they gain by implementing new technologies, Bloyd Street Capital is on track to double the number of flips they complete in the next year!
So How Do They Do It?. . .
They Find Opportunities to Add *Significant* Value
Anybody can look on Realtor.com and find a distressed house to fix up, but that doesn’t mean the property will gain value. Other important factors play a large part in determining a property’s resale value - especially neighborhood housing needs, public institution plans, and the trajectory of home values in surrounding areas. Bloyd Street Capital finds properties that larger institutional investors pass over, but still have a lot of potential to increase in value.
Brian and Travis recently finished an incredible flip in Northern Philadelphia. But what were the major factors that they used to determine that they could add significant value to this property? According to Brian, he felt confident that they could add value and that the neighborhood would reward them with a high return based on the following facts from his research:
The property was close to a growing university. Temple University is going through a growth and development period in its student body, but is limited in physical growth of the campus by the urban environment. By looking at the enrollment trends over the last several years, and seeing an increase of several hundred students per year, it became obvious that the market would be rising with this surge in demand.
The neighborhood is surrounded by areas that have seen a recent renaissance. Philadelphia is a town of neighborhoods and you can see when desirability spills into a new area. This property is surrounded by areas that have been on the rise for years, and it’s a good bet that the neighborhood will support a higher value home. As buyers spill over from rising home values in Fishtown, Brewerytown, and Kensington, Brian and Travis will have a property ready for buyers in that market segment.
They Add Value Quickly and Efficiently
“What we do is simple - but the execution is not.” - Travis
If there is one thing that separates Bloyd Street Capital from other real estate investment companies, it's that they have their processes laid out for maximum efficiency. This comes from a lot of experience, including mistakes here and there, that they have learned and improved from with each property renovation.
This growth-mindset transferred from Brian’s experience in the financial startup space, where young companies had to be agile and expect a steep learning curve. Some of the innovative, efficient techniques they rely on include:
They use all in-house work. It takes several years to build a team of experts who buy into your mission, but it can be done if you keep this goal in mind when making hiring decisions. As Travis points out, “We’ve gone through three or four guys in each trade to get to the core group of exceptional people.” It takes a lot of patience to find gems, but it will pay off in the long run.
Bloyd Street Capital keeps the business structure as flat as possible, so team members can contribute anywhere where they excel. Ideas for adding value to a property don’t necessarily come from the top down -- a plumber might see better opportunities than the general contractor. That’s why Travis and Brian keep the lines of communication open and expect their team members to contribute in any way they can. This collaborative structure also keeps projects on schedule, as any team member is willing to lend a hand in other trades.
They use technology to scale their business and outpace traditional investors. Instead of having to be onsite for walkthroughs or decision-making sessions, Brian and Travis have developed a video walkthrough and 3-D imaging technique that their team uses to stay in constant communication about the state of their projects. This means that they can be overseeing flips simultaneously in Miami and Philadelphia, or any two distant cities. At any one time they might have 5 or 6 properties that they can check in on digitally, because they have a trustworthy team who are technology enabled.
Great REI Advice from these Pro’s:
On adding value and creating a home for buyers:
- “We look at this as art.” - Travis
On dealing with setbacks:
- “Snags are not snags when you are experienced.” - Travis
- “It’s hard to make mistakes, but easier if you learn from them.” - Travis
- “For your first deal, you’re probably going to lose money.” - Brian
On financial matters:
- “We view RFG as our short term and long term partner.” - Travis
- “The best way to build a lender relationship is to do a successful deal.” - Brian
- “We consider RFG one of the best lenders in the business.” - Travis
- “It’s a third marriage.” - Brian
- “You can’t have enough relationships in this business.” - Brian
Check out the amazing before and after photos from Bloyd Street Capital’s recent North Philadelphia flip.