Does gender make a difference in how real investors and developers succeed in the real estate industry? Do women get involved in real estate from different starting points than men, or find different ways to thrive? Or do mainly the same skills and passions apply to most everyone?
These were questions that came up as iFunding was exploring the demographic of real estate investors and developers that attend our events, propose properties for development and participate in crowdfund investments. We’ve been interviewing female real estate developers and investors to hear about their careers, successes and learning moments.
Our first published interview is with Deirdre Virvo, a managing member of CT Property Network, LLC and co-owner of the Southern Connecticut Real Estate Industry Association, (SoCT REIA). CT Property Network has a considerable investor following, based on its steady offerings of loan investments on home flip and buy-and-holds in Connecticut.
A couple of caveats for our Women in Real Estate blogs: we have focused on investors and developer/operators as opposed to sales brokers/agents and property managers, roles in which women and men are both well represented. Also, we realize that each person’s story is unique, and that stereotypes are just patterns, which needn’t define individuals’ success.
Q: Deirdre, how did you get into real estate?
I owned a successful advertising agency for 15 years. Ultimately though, I realized that it wasn’t a business that built equity or was saleable. It depended on me and my partner being there for its value. The 2007 downturn affected my family as well, so it was time to re-invigorate our nest egg. I love a new challenge and love to learn, both through hands-on experience and education. I started taking a lot of classes – from rehabbing to note-buying, short sales, marketing real estate, even realtor and appraiser classes. I probably spent over $15,000 on seminars; equivalent to about one semester of grad school! Using OPM (“Other People’s Money”), I bought my first six-family rental property, which I still hold for the income.
Q: Did that ‘wide net’ of learning lead to certain strategies?
At the time, short sales were a clear opportunity. There were few startup costs; just a need to understand the local real estate demand, screen the contracts, and build relationships. I was doing “double closings” (wholesaling, or arranging to purchase a property and in parallel contracting with the follow-on buyer). When double-closings, while legal, started to be construed as not the thing-to-do, we started straight closings. These netted less, but we were able to do about 100 per year. We then started investing in fix-and-flips and buy-and-holds.
Q: What is your strategy now with CT Property Network?
Investors say they like to work with our CT Property Network business because we carefully screen properties, offer great returns, and are trustworthy. My business partner and I now hold 13 units and have flipped five homes this year to date. By offering secured debt , and delivering returns far better than the checking account or CD interest rates that many have been keeping all their nest egg in, people thankfully have been thrilled to lend us their money.
Q: Let’s talk about any differences you see in the approach of women and men in real estate.
I have a great business partner, Edward Zislis, who works with me closely on both CT Property Network and on the Southern CT REIA. We have complementary strengths, and in some ways this plays into common traits you might say are more related to women or men. For example, even though I am direct when it comes to most things, especially business, certain circumstances require kid gloves. When we purchase probate homes, where someone has passed away and the spouse or immediately family wants to sell, I inquire about their loved one, the house, what they are looking to do and then ask how we can help. I also send sympathy cards when I leave. Eddie tends to get down to business faster to present their options and talks terms earlier in the first conversation.
Q: So perhaps relationship building is more important for women?
Nurturing is definitely second nature to women. We love to connect. Closing on more than 100 deals per year takes finesse. I believe attorneys that I close with remember me for being able to facilitate complicated deals, and being the “Queen of Short Sales,” but they may also remember my home-baked chocolate-dipped, chocolate chip cookies, which I like to bake for all closing participants. I may be a “tough cookie” in business, but I am not afraid to show my feminine side, and I love to bake and feed people! Those cookies certainly are good for marketing and relationship-building. Also, I set high expectations for results, but I’m not very competitive. I love to be really good at things, but I respect that others are also as good and, if better, I see that as an opportunity to learn from them. My motto is WIN-WIN. Sometimes, I find that competitive men need to come out of a negotiation feeling they got the longer end of the stick.
Q: What about stereotypes about women and men, and their emphasis on intuition versus numbers?
First, everyone – men and women – active in real estate investing needs to be comfortable with the numbers. My dad was an engineer and my mom a librarian; I was required to get straight As in every subject. I’ve always loved numbers, can calculate formulas in my head and have steadily improved my eye for estimations in real estate projects. On properties we are rehabbing, I like to calculate holding costs down to the week to see what time costs us. People that rehab and see real estate as something other than a numbers game are not viewing it correctly as a business. I met a gentleman recently who decided to do most of the work on a house flip himself, but I don’t believe he is calculating the opportunity costs of his time well. Second, intuition is helpful, but don’t let it mislead you. I have recently had two separate interactions, one with a man and another with a woman, both of whom got too emotionally attached to a property they were involved with. They mispriced their deals versus what the market would bear, then got personally insulted when potential buyers asked for changes to be made to what they felt was a perfect renovation.
Q: Any other advice for real estate investors and developers?
My first advice is to read, read, read. However, in the end, accept that real estate is a hands-on business. Thus, you need to take steps both to get involved and to keep learning. Too many realtors I know won’t stray from showing housing; they won’t learn the appraisal side or the investing side. Why not? They have their finger on the pulse of deals but stop there in terms of value-add. Also, a lot of people are real estate junkies, taking copious notes at endless classes. Then, when I run into them years later, they still haven’t invested in their first property. I say: get out and meet others, and be comfortable putting in a modest amount into your first venture to get your feet wet.
Q: Might we say that crowdfunding can help introduce investors to real estate?
I haven’t worked with crowdfunding myself yet, but I’m very interested in the concept. The target returns seem appealing, and it helps a lot that investors can invest as little as a few thousand dollars in a project. That could allow them exposure to a few property types at once. I’m excited that iFunding is going to present about crowdfunding to the SoCT REIA this week (Sept. 10, 2014, 6:30pm in Fairfield, CT). (http://www.meetup.com/SoCT-REIA/events/192165942/ ).
Q: What else is going on with the Southern CT REIA?
We’ve been holding educational seminars for some time, first in Stamford and now usually in at the Fairfield Public Library here in Connecticut. We’re getting 40 or more people per event, which makes for great joint learning and networking for our attendees. We have individual investors, developers, contractors, brokers, lawyers all speaking up and contributing ideas and questions to the seminars. Topics have included short sales, bank-owned properties (REOs), cash-flowing commercial buy-and-holds, self-directed IRAs and multi-family residences. Both my partner Eddie Zislis, and our team organizer, Melissa Ternier, are super and make the events that much more interesting and enjoyable for the audience. I expect to grow the organization with a full-blown web-site (currently we’re at http://www.meetup.com/SoCT-REIA/) and day-long or multi-day seminars. I’d welcome hearing from folks who would like to attend or to contribute to our growth in some way. I can be reached by email at dvirvo (at) ctpropertynetwork (dot) com.