Passive Income Stream: Buying In and Staying Committed with Jason Yarusi

Many investors struggle to find actionable content and tools to build and strengthen their business and also gain a passive income stream through commercial real estate investing. In this episode, Jason Yarusi, real estate syndicator, investor, and the host of The Multifamily Foundation podcast, joins Brett Swarts as they talk about passive income streams and generational wealth, deciding to dive in and staying committed to the process. Jason shares how he helps people create a vision and the practical steps to achieve that vision. 

I’m looking forward to you guys reading this. We have Jason Yarusi. He is a great guest, full of wisdom and expert in commercial real estate and multifamily investing. He’s going to talk about why focus is key, why having a patiently aggressive mindset or attitude or strength is a key that has helped him help others grow their wealth through multifamily investing real estate and how finding the right partner, the right property, right property management and the right contractor are the keys to your success to growing your commercial real estate portfolio. Also, he’s going to share with us his best book, his best podcast to listen to and the best cities to invest in the next 2 to 5 years. He has some thoughts on that as well. I look forward to you learning from Jason. Feel free to share this with anybody who you think might help. Thank you so much. 

I’m joined by some of the top wealth advisors, whether it be commercial real estate, financial advisors or business brokerage. We’re focusing on helping you create and preserve more wealth by having a clear exit strategy with capital gains tax, whether it be selling your business, your commercial real estate or a high-end primary home. I’m joined by a guest who has tons of experience and lots of knowledge to share with us. Many investors struggle to find actionable content and tools to build and strengthen their business and also gain a passive income stream through commercial real estate investing. Our next guest is an expert in helping others do that through his podcast, The Multifamily Foundation podcast. He has active experience as a real estate syndicator and investor. He founded Yarusi Holdings. It’s a multifamily investment firm with over 800 units under management since 2016. 

The focus for our guests and his team is to reposition properties through operational efficiencies, moderate to extensive renovations and complete rebranding. He’s also the Founder of the New Jersey’s Multifamily Foundation Club with over 2,000 members and that focuses also on real estate syndication and multifamily investing. He also trains other successful investors on a formula for buying apartment buildings. You can find him at MultifamilyFoundation.com. Please welcome, Jason Yarusi. Jason is out of New Jersey. He also has a special report you can check out at YarusiHoldings.com, it’s how to become financially independent with apartment buildings. Jason, welcome. Will you give our readers a little bit about your story and your focus? 

I appreciate you having me. We are all on buying apartment buildings. We are located in New Jersey. However, we do buy outside the state. We have holdings in Texas, Georgia and in Kentucky. We started this focus back in 2016 when we found that the real estate objectives that we were doing were not paralleled with our future objectives. We want to create legacy for our investors and for our family so we could choose our schedule and create a dynamic future that is on the precursor of what we’re looking for. 

What had happened is that we grew up in a family construction business. After Hurricane Sandy, which was a huge hurricane that happened on the East Coast back in 2012, our business ties directly a lot to flood work. We got busy with that work that it was almost mind-blowing. If we could work 25 hours a day and eight days a week, we could have done it based on the inflow of work. I met my wife. I married my wife. Having a small family, having our first kid in a way, we knew we wanted to get our time back. It got to the point of, “What can we do in real estate to assist with that?” 

We started taking on active roles. My wife, Pili, became a realtor. We started flipping houses, wholesale, Airbnb. It occurred to us that we were creating ourselves more jobs. We went from busy to busier. It took us to start buying some rentals out of state to learn the process, learn what we’re doing and then look at that process and say, “If we could take this process of buying 2 and 3-unit and expand, what would that do for our future?” That’s how we dove into apartment buildings. We went from buying a three-unit to buying a 94-unit as our first acquisition, which was back in May of 2017. 

I connect with buying more jobs, maybe having more of a passive investing strategy, which truly frees up your time and energy. I can relate. You mentioned you have some kids. Being parents and having kids, you want that time, but you also want that energy. If you’re starting a new business venture or a new real estate deal or whatever it might be within real estate, oftentimes the idea of passive is not even close to passive. It’s even more active, especially in the beginning. It’s important to know that there are different levels of passive that you can achieve depending if you’re doing single family flips, wholesaling or multifamily. Walk us through the moment when you said, “It’s multifamily and it’s going to be more on this passive strategy versus the other strategy of single-family flips.” 

The word passive doesn’t necessarily exist. Nobody says, “I got this thing going and I’m on this beach.” It’s this preconceived notion. I probably drive myself and my wife crazy if we’re sitting on the beach. That said, it became a point when we started getting checks in the mail when we were having properties that were in the Midwest. What we had done is we aligned ourselves with the right partner to help us find the property. The right property managers have guidance on what we’re going to do to manage property. The right contractors to reposition the property and get the property back on par. What this did was take me out of the picture of the things that weren’t the highest and best use of my time. I was able to focus on putting together the process and put together the plan and that plan was able to circumvent in us having income coming in. 

What I could do is I could use my resources, not only I could that one time, I could do that 2 or 3 times. If you’re buying a single-family or two-family, if you do want to scale and create that legacy and generational wealth, that’s going to take a lot of resources. There’s going to be some pinnacle where I’m on a plateau or have some diminishing returns. Looking at that, we said, “This is great, but we only have two units under one roof. What if we took that and we made it into 50 units?” That was that first moment where we said, “How can we learn more about this process?” We found partners that were doing it. We watched the process with them. We asked good questions. We started getting as much like podcasts, like yourself, diving in for podcasts that were on the subject. We got focused on our minds, and that’s part of it. 

One of the big hiccups for people that I see, especially even people who train, is that they need to get focused on what they want. If you get focused, then we can create a map to get there. If you’re not focused, that’s why nothing gets accomplished and you feel like you’re wasting time or you don’t have enough time. I will speak at a REIA and I may focus on multifamily, but the people that are at that REIA, the next month they’re going to say, “Someone’s going to talk about Airbnb.” The following months, somebody’s going to talk about tax lien. From a real estate approach, there are so many great ways to do things but there are so much content and so much information available that you can get lost in the mix of never starting. Stop starting continuously because everything seems like a rosier picture. For us, we knew multifamily gave us what we wanted. It has allowed us to use our resources and grow with others. We can do this with our friends, families and investors to help them meet their goals as well and have a pattern that we can replicate this process from property to property. 

That’s amazing and that’s a great reminder that focus is key and not looking at if the grass is greener or the new rosy, shiny object to grow wealth. Pick a focus and be a specialist in that. Dive in and stay committed to the process and then also picking the right partners, property managers, contractors and properties. Hopefully, buying when the market makes sense and finding deals by being patient. Before your success as an entrepreneur, an educator, a multifamily syndicator, an investor, who was Jason growing up? I want you to tell us maybe that one strength that you were given. Everyone has been given a certain strength. Some people call it a superpower. It’s God-given gifts. What was that one strength that you were given and how does that connect how you help people? 

I will say patiently aggressive. I set my mind with something and it may take my energy but I’m going to get it done. I will put in the work to get it done. I’m a big runner. I’ve done a ton of marathons and just got in my mind that I was going to start running an Ultra. I did run a 100 mile. My first 100-mile and I said, “I’m going to do it under 22 hours.” I did it in 21 hours. It’s the points you need to tell yourself that you’re going to get something done and then it’s going to be, “I’m going to get it done. It’s not going to be a perfect path, but how can I get to push to the yes even past all the noes?” That goes a lot with what I do with business. It’s for our business. You’re going to have a lot of noes, but it’s how many noes do I need to get to the yes? 

Who is the right person that can provide me with the right answer that I need to move the project along? Where I found my faults is not another’s. Growing team members and bringing on team members, you’re only going to be as good as the questions that you can bring up to them. If you can’t ask good questions, then they may think that they are giving you all the information you need. Since you didn’t ask the right question at the right time, and some of it may be on the novelty side where you haven’t learned it yet, but other parts, you’re not doing your homework. The better I get at questions, the more successful ourselves and our partners will be because then I can make sure that I’m laying out all the pieces and also bringing more to the project because I can think about other ways to add value. 

What’s one of the best questions you ask an assistant or a new team member? In general, what’s something that’s going to help delegate your time and your energy? I know a lot of our readers are business owners, entrepreneurs, real estate owners. What are maybe 1 or 2 questions that are going to propel them forward? 

Pili and I met in New York City. I had done a lot in the restaurant industry. I’ve opened a brewery and a restaurant. I worked at a big place. We’d have people come with the idea of, “We should do this.” The question would be, “That sounds like an awesome idea but I’m not doing anything. If you want to take it on, I support you. You get it done and then we’ll see how it turns out.” It’s putting people and empowering them to take the step on. Everybody has great ideas, but the circumstance means no one’s going to do it and no one’s going to take responsibility. 

Empowering and putting it on them versus, “We have this vague notion that this might be something to do.” That’s not getting anyone anywhere. “You do that. I’m not a part of that. Emotionally, I support you. I give you the authority to go do this. Go lead and make that happen and report back and let’s talk if you need help along the way.” 

It’s important because if you are going to grow a team, you need to be a manager of people’s best performance and you don’t want to be a task provider. If you’re a task provider, then every time they have something, they’re going to come to you and you’re going to provide. They’re going to go get it done, then come back to you and you’re never going to get outside of your growth pattern because you’re going to be stuck assigning tasks all day. 

I absolutely have learned through the fire with that one. When did you become fascinated with helping others? You went from succeeding by yourself to educating people. What happened in that shift there? When did you become fascinated with reaching out, helping others, particularly in real estate wealth, and getting more passive or getting additional income coming in for them? 

It’s always been a pattern. Growing up, I’ve always had an aptitude. I like to help. I like to see people through their process. We started getting a lot of questions about this. We started to meet up to give back. We said, “We’ve learned all this great stuff, we’ll start it.” This was the precursor for a lot of other things happening like events and others because people were looking for more. People can do things. Sometimes it’s them getting permission to do it. For some reason, they don’t have the permission in their mind to do it, but if I can stand here and say, “You want to buy ten units? I believe in you. Do you want to buy 50 units? I believe in you. Let’s create an actual process. What does that look like? Do you want to buy 50 units? Where is that? How much is that? How much loan do we need to get? How much money do we need to get? How many investor talks are we going to need?” 

We can make it real. You hear this a lot about, “I want to get 1,000 units.” What does that mean? Is that going to solve your problems? Is that going to create generational wealth for you? Is that going to create cashflow? Is that going to be ego? What does that even mean to you? If you don’t have a meaning behind it, one, it’s not going to happen and two, you’re not going to be able to build an actual plan to get there. If it’s, “I want to get 50 units because I want to have cashflow to replace my income from my job that I still want to stay at because I love my job. If one day I get hit by a car or I want to step away from my job, I can make that choice.” let’s go after that plan. 

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