If they’re smart, they do it the same way the barber won the race:
By knowing the shortcut!
Today I’m sharing a presentation from Maggie Smith, who went from being terrified to pull the trigger on a simple splitter deal… to recently banking $1.2M in a 1 into 7 subdivision.
Maggie has presented on many, many of our bus trips. She has proved her ability to put great deals together time and time again. And with so much IP, information, and intel collected over the years –– when she talks, you better listen!
This was an off-market opportunity. I won’t go into the backstory, but basically the agent was getting in the way of the deal.
The first contract crashed.
I had it under contract for $780,000, and she wanted $800,000. My civil engineer told me to run away as it may never get developed. So I was pushing at one end, and the agent wasn’t informing the owner.
I knew there was money in this deal if I could solve the difficult problems. So I paid the owner a visit one Sunday afternoon, knocked on the door, and clawed this back.
It’s a 3800 square meters site. Completely flat, which is not likely to have flat size. But it’s got level four and five overlay of flooding. So it has to be built up by a metre. And it needs an acoustic barrier put around the front of the property to protect from Gympie Arterial.
On top of that, the nearest sewer point is 110 metres down the road.
So I’ve done a 1 into 5. We were thinking about doing NDIS at the back. Because, once these blocks have been built, we could put disability housing, robust housing, where they need no neighbors, no neighbor fatigue, no noise.
I designed it so I can carve the rest up into another, so that it can become a 1 into 8. So I can get eight blocks out of this site if I don’t decide to go the NDIS route.
Nhan: Look. For some of you, you might look at this site and see it is risky and is very challenging.
To be honest, it is challenging. And if you don’t know what you’re doing, it’s a risky site.
The thing that you want to understand is that this is not Maggie’s first rodeo. She’s done many deals, working through the programs and the training that I’ve given her over the years. As well as other courses and other training.
So when she came to me, probably around 2013 or 2015, her first deal was just a splitter at Mitchelton.
And while people now see the Maggie willing to spend money on herself… ride a nice car… and a lovely pink diamond… But she had to work on a lot of personal things, a lot of skill sets, learning how to do a feasibility, and being willing to say no to certain deals.
Now she’s the powerhouse that she is now.
But for the people who are beginners, it’s worth sharing what the initial 12-24 months are like.
Maggie: Without Nhan’s guidance and training, if I’d been left to my own devices, that would have been a lot of deals that I would have done that probably wouldn’t have ended up great. Skinny Margins, just missing things out.
By now, I’ve done 10 or 12 projects. With each one, I’ve taken a bit more learning and growth.
Going back to the beginning, during the splitter, it was nerve-racking. But you have to do that to be able to go, “Okay, I can now do a subdivision.”
And with subdivision, remember it involves easements and main road and stuff like that. So I was learning all those new things. I would never have been able to do this as my first.
I used to go to Nhan and say, “I want to do more,” and he was like, “Be patient.”.
Nhan kept me grounded.
Nhan: We mapped it out. The first five years and the first five deals that Maggie had done were 1 into 2’s. 1 intp 2’s, 1 into 2’s. Now she banked over $1.2M profit, which was 1 into 7. But my point is, the first five years she did simple deals.
It may seem boring and not as profitable as $1M-2M million bucks.
But you got to learn those lessons in those four quadrants I talked about.
And as you build those skills, you also build your intellectual and financial capital.