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This week on Backed By The Bros, Drew and Jonathan had their hands tied trying to determine which of the potential investors to back. The two potential backings were so similar, and yet so different from one another. Both were veteran property investors, and both had a lot to lose. One property was a single-family home in a quiet residential neighborhood, while the other was a triplex property in a bustling metro. While the Brothers decide who to back on episode 5 of Backed By The Bros, there was so much on the line to consider.
Both of the potential backings had a similar issue—both went into their individual properties less than prepared for worst-case scenarios. “You have to understand the market and you always have to play worst-case scenario,” says Jonathan. “Anyone who plans on best-case scenario is going to fail.” And as we see, the clock is ticking on both of these properties in the race against time, budget, and income. The Bros have to choose wisely. Their career and their reputation is on the line, and so is the wellbeing of these investors.
The Potential Backings
Sean & Natalie
Natalie and Sean bought a flip house in Valley Village, California, an upscale family neighborhood with tree-lined streets and privacy. Sean’s worked in construction for 15 years, and Natalie is a real estate agent with expertise in flipping homes and increasing profits. Natalie’s husband is Sean’s business partner, and the two have been working together for years.
Even with their shared experience, however, with the cost of supplies and labor soaring right now, Natalie and Sean have hit a dead-end getting to where they need to be in order to sell this home. They’ve already gutted it down to its studs, and they need the Brothers’ guidance to show them where they can best spend their money. They plan on making it into a 5-bed, 3-bath home with an ADU and a pool.
Sheryl & Jasper
This mother-daughter duo has a property in North Hollywood, California. As a team, these two have a ton of experience—Sheryl has been renovating and selling homes since the 90s! But they’re just now getting into multi-unit projects for the first time. After two years, they’re still only part way through construction on a 4-story triplex, and they’ve hit a standstill. They had to get plans reapproved by the city after finding out that the residential property they bought was actually turned commercial, and hit a ton of unexpected costs.
They’re still constructing the interior of the building, so they’re just at drywall. And the amount of fixes they’ve had to make has already put them $200K in the hole. They’re in serious need of the Brothers’ help to get them un-stuck and back on track so they can finally breathe easy.
So, Who Do the Bros Back?
After discussing the options, Drew and Jonathan decided to back Sheryl and Jasper. The Bros believed that the mother and daughter need their help the most, and there’s a greater potential for Jasper and Sheryl to fail without their guidance.
The Bros still offered Natalie and Sean their best advice and tips throughout their project. And they’re confident that Natalie and Sean have the tools necessary to succeed on their own and make the house ready for purchase.
Getting Organized
Drew and Jonathan called on the expert help of their designer, Kelly, and project manager, Donnie, to help get this building renovated and ready for renters on time and on budget. Donnie called on his crew to help facilitate construction work still needed before they can make any cosmetic decisions. Kelly helped Sheryl and Jasper make smarter money moves on certain renovation projects.
Smart Shopping
A Trip to the Back Warehouse
Kelly showed Sheryl and Jasper exactly how to stretch their budget smart so they still make the space beautiful, but do so frugally. One of those ways? Saving on tile.
Quality Without the Dollar Signs
Kelly showed the duo that they can still incorporate the gorgeous stone they want. But by going to the back warehouse to check out discounted slabs of porcelain, rather than natural stone, they’re saving huge in the end.
Revisiting a Previous Investor
After finding out that one of the first investors that Drew and Jonathan backed—James and Isabel—were on their way to buying and renovating a new multi-family property, the Bros thought it might be a good idea to pay them a visit and see if they need any help getting started. Jonathan decided to help point them in the right direction when it comes to choosing a property, so they don’t find themselves in that same money pit situation they were stuck in before.
However, in their first backing, James and Isabel pushed back on the Brothers’ suggestions on a slew of things. So whether or not the couple listens to their advice this time around is all up in the air. Either way, Jonathan was happy that he was able to be a mentor to them through this new process. Hopefully they heeded his guidance to make the right decision.
Next Time On Backed By The Bros…
We’ll watch and see what happens as Sheryl, Jasper, and the team get finished on renovations. There will surely be bumps along the road, and they’re hitting a wall with their timeline. Will it all work out in the end? And if it doesn’t, what will be their next move to turn this money-draining property into a success? Tune in next Wednesday at 9:00 pm on MAX to find out.
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