Wes (00:00.462)
You just plays an intro, right? Yep. So welcome to the small business living it podcast featuring Dean Castellano.

All right,

know we're welcome yeah we feel legit we're kind of doing it in the round we're all kind of looking at each other no more looking linear so

The studio gets cooler and cooler every time. So I do want to, we kind of have a double dip here, if you will. We have our second guest from, that's come across the pond, if you will, and is a small business guy. And then, and we also have a home builder and, and Sean, who's our, what's the best word for that? I don't want to say is immigrant.

We're trying, we're trying.

Dean (00:52.782)
A fair word to you. Yeah. My grandpa came from Portugal. So, you know, we're, consider myself the immigrant and he came to Western Pennsylvania. Bruce, how many, how many, um, so Sean's pronounced your full name for me. Sure. Sean's from Iran and came here when he was 14 years old, came to Texas.

It is, absolutely.

Shawn (01:12.204)
Sure. So non-zaphyper.

Dean (01:21.555)
and he has a story which we'll get into. And then Bruce came across the land from New Jersey.

yeah. What exit? Sorry. has to be said every time, right?

And then what is it?

Introduce yourself. So Kaminsky is a good Irish name, of course, from Southern Jersey. And then your family though, how many generations in New Jersey?

First Kamensky.

Bruce (01:42.06)
Yes, near Philadelphia.

Bruce (01:48.888)
So my grandfather came over for Fulham and then my great grandparents came over from Italy.

Yeah, very similar to my story from New York. So this is called small business. These guys are very successful small business operators. they're both customers. They're both vendors. They're both partners of grand mortgage. We both had great success together. Absolutely.

would say buddies too. Yeah, there you go. Buddies first. like it.

But it's hers.

I think Bruce and I have had one of them, a couple of more expensive two man dinners. I'm sure. say.

Wes (02:27.114)
One-hit Nickens. Yeah, what's the point of working so hard if you

But it pop is that Sean has a pop is connection. So I want to say that, you know, just do a little bit of personal background then we can talk about how we met and kind of the fun stuff we've done together. would say that of all the, guys we've supported since 2017, probably Bruce's we've done the most business with, and he introduced us to Sean.

Sean used to be that guy that worked like 90 hours a day and eight days a week. had a restaurant business and now he's a developer and he can work one day a week.

that hustle.

Wes (03:08.046)
So you're expert in Beth too? Yeah, but you don't have to deal with customers as well. You still do, but it's a little bit different.

Still worked the same.

Dean (03:17.666)
hard working as he was. just does different stuff. So he works smart now. So, so Bruce, I've known you the longest, so you get to go first. Tell us a little bit about your personal life as much as you're willing to share how you got to Texas and what interests you about business and small business.

Yes.

Bruce (03:38.978)
Yeah, so I'm originally from Camden, New Jersey. Camden, New Jersey is right across the river from Philly, a blue collar area, rural homes, segregated areas. And then after sixth grade, Mukacherry Hill, and then went to school there. then my family was in the restaurant industry. So that's what I grew up in. know, 12 years old, was in the dishwasher or family restaurant. Went to school for hotel and restaurant management. And then for mayor, I,

graduated college and had a job opportunity and I came to Texas. Didn't know anybody, again, still following the restaurant career, you know, from my family's business and did that.

Sorry, I still got it.

We're equipping up. Yep. We're going to headphones, man. It actually is cool. Can you guys hear me now? That's a little better. It feels a little more efficient. So, so you're the restaurant. think we all, worked in my uncle's luncheonette when I was 14, rode my bike there, washed the dishes. I tell people that I scrubbed the spaghetti pot bigger than me.

I'm in it.

Dean (04:55.668)
I was cried every time I did it because it was so fucking. But the pot was bigger than me. Yeah. Yeah, man. That spaghetti that crested on. So anyway, I digress, but an Italian restaurant.

Not this best day but.

Bruce (05:09.934)
Yeah. So yeah. So then, you know, I came here in 86 right out of college and, then did the restaurant, you know, small sports bars and a couple of Italian restaurants. And then, um, and 2002 got into real estate. always wanted to be in real estate. And I, um, after the, the restaurant from a, from a, um, a restaurant over by Stonebriar mall, it opened up before the mall was there. was a little bit.

premature and we had to fight the construction from Freston going from two lanes to six lanes and it was one mile north of 121. And then after 13 months we had to close the doors and then it gave me the opportunity for my desire to get into real estate and started doing that.

So that's where we will pause you right there because there's elements there that are the theme here, which is grit and resilience, right? So what I'm going to ask you after Sean is what attracts you to small business versus having a J.O.B. So not yet. So all right. So Sean, Sean came from another country, eventually worked his way into

being a small business owner, but how about a little bit about your early life?

Sure. Well, first of all, it's an honor and privilege to be amongst two of my idol and, you know, two of my mentors. I feel lucky to be here and speak with you gentlemen. Yeah. Welcome. Yeah, thanks. Y'all grew up in Iran, Tehran, the capital. And, you know, as you can imagine, third world kind of problems, you know, just beautiful childhood.

Dean (06:59.682)
What's the year when we

I was born 84. 1984. Yeah. Yeah. So we're.

Do they have the word millennial anywhere on?

No.

We're vintage millennials, okay? We don't fall on that end of millennials.

Shawn (07:14.638)
You're just a kid until you move out of the house. Yeah. There's no. Yes, actually. Absolutely right. But beautiful childhood. You know, my dad is a mechanical engineering and just watch him build businesses after next. you know, the, you know, the war was going on at the time, Iran and Iraq, even though was, you know, four or five. just watching, you know.

We actually like working hard.

Shawn (07:41.678)
a difficult situation, you know, as a father would, fearing for the family and so forth. And, you know, never cracking, you know, he's never, I never saw fear in him. We had bomb going across our heads. So just watching the man he is, the integrity just and how he did business and was very trustworthy, but very analytical as an engineer is. But yeah, I I experienced the war back home.

very scary, you know, sirens go on, you have to go in a bunker and you come out when the bombs are whistling above your head.

What were your parents saying to you during those times?

You know, I, gotta give it to them. I mean, it's, I've never actually felt fear as dangerous as you can imagine. Just bomb crossing the borders. Siren goes on going to bunker. But I remember my dad just down in the bunker, just playing with my toys and just, I'm sure he was fearful inside, but he never showed it. And I don't fear like, my God, we're about to die. was just, Hey, let's go in there. It's just the next thing we do. And that lasted eight years, but it was.

for about a couple of years it was bombs blowing up the next neighborhood, et cetera, but the way they framed that, was the best job they could have done for me not to be, you know.

Wes (09:03.99)
And I had a panic attack watching twisters. I mean, okay. The weather made West. I hear the air horns. Yeah. Anyway, different reactions.

weather.

the

But you know and then my parents split up they got divorced and you know, have amazing memories from different times eventually, my mom moved to United States got remarried and When I was 14, I had an opportunity, you know to come to the dreamland the American dream and

Do you remember the circumstances of how your mom got here? Was it through friends or family?

Shawn (09:39.214)
It was through friends and family that met my stepdad. I mean, the whole process, we can do a whole podcast of going to Turkey. We're there for months and months and months waiting for our appointments. And, yeah, it was a, sure a journey. and, you know, my grandfather was one of the generals of the Shaw, the Reza Shaw, the Shaw's dad. So that left the country.

years and years before revolution. Some of our families were higher up in the army, the scape and a sheep's skin, you know, across the border. So just us leaving a country, was quick. It was kind of, had to go to Turkey. We were there in Istanbul for about eight months before we got an appointment and we came to U.S. But my mom had previously, a couple of years before us, had gone to Cypress, met my stepdad.

got married and then eventually we came. Yeah. Wow. We got a real point.

Well, we know who has the best story. Well, and scary too and very brave. mean, I think that's part of the theme. Our previous guests, I talked about him, Chang or who came from Hungary, born in Transylvania. And again, it had a dangerous border crossing and things like that. It's something that we take for granted. So I love to hear these stories because I think they're born in grit and born in resilience. So Bruce.

Two-parter.

Dean (11:07.944)
a little bit about your family, brothers and sisters or...

I'm an only child. My mother was an only child. My father, there was three kids and his siblings. And yeah.

What drove you to come?

to leave New Jersey.

Yeah, just a job opportunity and just to really, my grandfather had a, you know, going back to my grandfather coming home from Poland, he had sixth grade education, couldn't read, couldn't write. And he was a Shylock, I believe. And ran numbers and stuff like that. he was just, you know, was in the bar business and he figured if he didn't know how to read or write, he had to get into a business that could make money to pay those kind of people.

Bruce (11:57.07)
And so he always went from a small corner bar, then the restaurant, and then he built the place. of like, somebody said it to me before, he said, your grandfather was before his times, because he bought a piece of property in 1965, built a freestanding structure, which is about 5,000 square foot, built a bar, a horseshoe bar, and then built a restaurant around it. And if you think of pay up chairings, that's kind of, yeah.

Interesting.

Just bring the mic just a little bit closer to you. Sure. Yeah, sorry. All right, there we go.

So Bruce and I might be the two most soft-spoken guys from New York you'll ever meet.

Hey, yeah, Bruce

Wes (12:40.962)
You won't wear bright hair, it's like...

You'd be yelling at each other. It's still not working. You want to, you want to switch? Okay. All right. So, um, it's funny, by the way, those listening, did you notice the level of detail relative to the size and so forth? Just like a real estate guy, 5,000 square feet bought a piece of property. mean, most great operators did Papa's own. So

Okay, yeah, sorry.

It's okay, we're good.

Wes (13:05.036)
Yeah.

Wes (13:11.69)
Also, 5,000 square feet in New Jersey. That's a lot. That's nothing in Texas, but my.

God. that brings me to a question. just a sidebar for a second. So Sean worked for Papa's. What and did they own all their real estate? Yeah, see, there's a there's a strategy there, a small business strategy. There was a family owned business that started in Santa.

the game.

Shawn (13:38.912)
Houston and yeah, starting to look

So we're going to talk more about that too, because Sean was a corporate guy that is now a small business owner. Like I said, he worked 90 hours a day.

And the food and bed world. I did food and bed for 15 years and not going back.

So Bruce, why, why do you think you, what do you like about being a business owner versus working for someone else as a career, like stability and benefits and all that fun stuff and structure of the big company. Like IBM was the place when I was growing up, all of our dads worked for IBM up in New York. And that's kind of what you aspire to do.

Yeah, so kind of like Lee just said, to touch on that, the same thing with me is that I've never come from that. So it's always been the small business owners, but been the entrepreneur. So that was in my blood. And then my little taste in the corporate world was Bennigan's. I'm sure you remember Bennigan's. So when I came out of college, that was my job here. I was in Las Calinas at the Bennigan's there, did real well there. And then...

Bruce (14:50.254)
Usually you can't dictate where you wanna go, but I was kind of like at the top there, not a GM, but at top as a manager. And I had the bright idea that I wanted to go to the Galleria, because I'm looking at the numbers, because you're based off of bonuses. So I'm looking at the Galleria, it's like the top 10 in the country. So then I went over to the Galleria, inside the Galleria Mall, and our corporate office was right there, off of 635.

So then now we get all the corporate people coming over and just seeing how they act and so forth. It was, yeah. So I did it right out of college and then I started getting the small sports bars.

Was that too much? I got it. Yeah.

Dean (15:32.76)
So what would you say you learned being at Bennegan's? That you still practice or maybe you absolutely

No, that's a great, no, and I say this all the time and that's a great point Dean, is that, you know, the one thing that, not the one thing, but for my grandfather, you know, the businesses to school, to Benningans is you got to watch your numbers and you got to watch your BebNap costs, your supply costs, your labor costs, your food costs, and you got to watch every penny because that goes to the bottom line. And I implemented that in the real estate. So that's how I look at things in real estate. You got to watch your costs.

Thank you, Ben again.

Yeah.

So jumping back over to Sean, you got you you're 14 you come to America.

Wes (16:20.056)
Grand Prairie.

Yeah, Grand Prairie High School, zero English, got here first week going to high school. So talking about grit and resilience, you know, I I past, I was taking college algebra, I know it was. I didn't pass the writing and reading, but a lot of the algebra and stuff was, yeah, it's just way advanced when you come from other countries for sure.

How'd you do an algebra that? You did!

Dean (16:48.046)
So then you, so after Hype, so what drove you, so tell me before, I know you were at Papa's, but what was before Papa's? Subway.

So I started right when I got here, worked Subway. was a sandwich artist for it is.

That's a great name. Sandwich Artist.

Well, that's yeah, what's it called? Double speak. It's a

I'll made every single sandwich combination you can. I was an artist and I became a supervisor. And then I graduated early. I graduated when I was 16 turning 17. so I did freshmen, sophomore one year and my second year of high school, did junior and junior senior. So I went, started working for Papa's. I went there and I heard, a good company to work for.

Wes (17:10.551)
Piece of art, right?

Shawn (17:38.196)
and you now there's Papa Doe's office

into the restaurant.

Really? Papa's like, Papa does?

There's all the poppies poppies is the steakhouse which might be the most

That's the man. Yes. Yeah. So yeah, I just went an interview, had never eaten there before. and I started as a food runner bus boy and I was going to college. got accepted to UT Dallas and, you know, your Iranian Persian, you either have to be a doctor, lawyer, engineering or no pressure. And, know, so I wanted to be a dentist. so I went to UT with, you know, studied science and biology with, pre dental.

Wes (18:08.896)
No pressure.

Shawn (18:18.85)
post-bac program that I went after, after I graduated, but along the way, you know, was good server became bartender and I just learned the skill, the people skills and how I interacted with people. so somehow along the way they convinced me to become a manager and, that kind of advanced my career with Papas.

How did you, when, so I've had, being a bartender, I've had a lot of friends that was transitioned from bartending to management and the sell pitch was, you get consistent money. But then there's also, but they don't really mention that you just took a $5,000 pay cut. Yeah. Yeah. Yeah. First one in, definitely the last one out.

work more hours.

Shawn (19:03.934)
I pretty much transitioned. what I did and I transitioned out of Papa's family to my own business as well. I'm pretty conservative. So I kept my best shifts as a bartender and I said, okay, I'll do two shifts as a manager to see how this goes. So I kept my Thursday, Friday, Saturdays, and then I manage Monday and Tuesday nights. And then slowly just, you know, just kind of transition full time became a kitchen manager. And then before I actually,

Getting to the dental program to offer me a general manager position, which you know, you're in charge of 250 employees, pay great salaries, et cetera. It was too good of an offer not to accept and breaking that news to my family saying, Hey, I want to be a restaurant general manager and not a dentist. was a news to them, but they're

Make cavities, not fix.

Yeah.

But, uh, so yeah, that, kind of started my career with Papa's family. Um, I mean, I have 15,000 employees plus now, but, you know, they're not a actual corporate, but it's a corporate structure. They're family owned.

Dean (20:07.33)
They, know you've, I've heard you say that the family, it's family owned, Yeah. Privately owned. We're really good to you personally. And that, so what is the thing that you learned at PAPA's that kind of drives you?

Harris and Bruce A.

Amazing,

Shawn (20:25.729)
It's having a culture, um, you know, caring for your people. Um, you know, again, Harrison, Chris, two brothers, they ran the entire company, but we still felt their presence in the restaurants every day. way they took care of the people, quality systems. Um, I mean, you know, they always said just for every successful business, you need four things. need your people, need your product, you need processes, and then you need profit. But if you take care of the first three.

You don't have to worry about the last. And that was just engraved into me as a young man. So, um, yeah, I really learned volume. had a few thousand employees, um, fast forward, you know, I got an opportunity to, I was.

there during COVID. I want to talk to both of you guys about how COVID impacted your business and your brain, your business brain too.

It

We had to create curbside systems and drive through lanes and overnight we had to really become profitable and how we did business and cut the menu and quarter. mean, we got rid of a lot of items that was just, you know, took a lot to prep. Um, but yeah, moved up as a, uh, regional moved to Houston, worked with the family very closely that the headquarters there. Um, you know, I was over multiple, multiple markets and

Shawn (21:44.312)
Few thousand employees as an executive for over 10 years. So I learned a ton about systems, processes, procedures, but more so is all about the people. And I think for my small companies, just having a culture, having the core values and principles, and that's in forefront of everything we do.

That's cool because I think what I would say is what I have more in common with Bruce is that we kind of bootstrapped it the whole way. And I know that that's a bootstrap story, especially if you can't speak the language and you graduate in two years. my God. But that formal training, right? It was throw you in the kitchen, right? It was learn it as you go. I was telling the story about cleaning that pot.

I cried when I was cleaning that pot because I hated it. And I'm like, there was a point in time where I'm like, I do not want to do this kind of work. I'm going to college because I want to sit on my earn money. so just real quick, do you remember what you're like, what type of money you made? Like whether you're at Bennegan's or the rest.

Right.

Bruce (22:57.934)
I think that was years was that yeah 86 and I think it was like 55,000 a year

Yeah

That was good. Yeah, that's up. Wait

lived that New York life for a thousand a month. 1980.

Yeah, my other job, I don't make that.

Shawn (23:16.238)
That subway, I think it started me at $4.10. mean, was 100 or something. Artist. was an artist.

And you are an artist. No artist.

make money we know that I was I I would say was the South Carolina we were 250 an hour 215 but you got to keep all your tips but say okay

Right. So.

No stress on that one.

Dean (23:39.726)
So the industries that you've left, we talked about that lesson, would you ever open another restaurant or would you advise someone to open?

So funny story. I guess we have time. So after I, so I got out of the restaurant business, got into real estate and then got into, when I was in real estate, then the Great Recession happened. And then, so I was out of both real estate and the restaurant and I swore that I would never get back into the restaurant industry. And then when I turned 50, it was like a new chapter in my life.

got a divorce and everything and my mother persuaded me to get back into the restaurant industry and I swore I would never do it. She says, if you don't do it, she put pressure on If you don't do it, I'm not doing it.

The mama, she's...

Wes (24:31.182)
Little back hands to the head.

But I was optimistic thinking that I can get in it, put all the systems in place, do it for a year and then get out. And then she could just go around and touch the tables, be the front, be the owner and the face of it. And wasn't that way. So no, I wouldn't recommend for somebody going in a restaurant industry.

Do they really make a lot of money when they operate?

properly. If you operate it properly. And one advice I have is own the real estate and that that's was the transition for me out of the restaurant to the real estate because Harris said our main business is real estate. We're not even, we just happen to be good in the restaurant industry, but as long as you own the real estate, you put the restaurant on top and pay the note and anything on top, you know, it's, it's a, it's a plus. So I,

I think you have to be all in it. It's just a very, it's 14 shifts. It's not like you get to go check in and out. It's constantly things going. There's a lot of people that work for you. There's a lot of people coming in door and I wouldn't say it's thin margin, but 15, 20 % of it is pretty average. So, I mean, just depends on what you're trying to.

Dean (25:45.272)
Would you own a restaurant, grow a restaurant and keep it private for cashflow and real estate? Or would you own something to execute on some sort of exit?

I would, and I've been offered and there's potentially opportunities, but yeah, I think I would do something simple where we can, you can build 12, 15, 20, and then exit.

So is your little pizza place, are you still involved in that?

Which pizza place? Mundo's? Indirectly.

I'm just curious because you kind of dipped your toe there a little bit. So what did you, did it exit or you sold it?

Shawn (26:27.714)
Yes, yes.

Shawn (26:31.95)
No, we still operating it. it's the location is tough, but I mean, it's making money for a small place. but Yalla groups, um, Yasser, um, you know, he's a great chef and he's been knocking on the door for me to help him with operations. Got nine, nine restaurants around town. And, um, they're trying to suck me back. I'm resisting.

They're trying to suck you back.

Dean (26:58.702)
I got it. All right. So you want to jump. So I don't want to keep you guys. How, where are we less on the time? All right. So there we go. That's a good break. now we can kind of talk about Graham mortgage and you guys and how much we all kind of have done together. All of it. Good. I would say, um, so Bruce, what year was 2015? So that was the, that was 2015 is when.

We're about 30.

Bruce (27:23.064)
team.

Dean (27:28.3)
We start coming back as a housing market. Is that fair? 14, 15, the housing market starts to come back. How did, were you, so now you're out of restaurant business. You, you left your, you cleaned up, everybody had a mess from the housing crisis, right?

Oh, 2008 was an awesome year.

Well, and that's part of the resilience part, right? Left it honorably, cleaned it up, moved on, went to the next chapter and comes to me. And then I knew his product because I almost rented a house that he had built. And so I love urban. love, I love two story. I'm not a big three story fan.

We talk about this almost every conversation.

Three stories is a plex.

Dean (28:26.934)
Well, but it's also, I think it limits your buyer pool or your renter pool. You know, when you're young, you don't care. just run it up and down the stairs. But Bruce built this, I don't know who designed the floor plan, but I also thought the floor plan was amazing because it has the living space downstairs. had the bedrooms upstairs. You were able to get three bedrooms. had a yard. So he came to me with that and I knew the product and he's like, I want to build.

five or six of these on lots in Los Calinas. And I already own the land. And did you know how much our money costs at that point?

More than 55,000 for sure.

No, was a percentage. There was a vertical cost. It was a percentage of constructors, not as a partnership.

Yeah. So that was interest. And what's interest, what's fun for me is here's a guy who knows what he's going to do. He's from my part of the world. I've already know his product. He's already made it easy for me by owning the land free and clear. It's already zoned, right?

Bruce (29:38.542)
Yeah, it was. were were a very simple town home.

Well, there's a supply issue for housing. it's like, let's go. So, the same stuff. think you pre-sold a lot of it. I did also dealt with, you've had all the challenges of people working for you and you know, we can talk all day long about permitting and, shared access agreements and.

Bruce builds a

Dean (30:12.962)
Getting stuff done during COVID and all those types of stuff. let's just say, so we've known each other 10 years now. We've done 15 or 20 transactions probably. And it all comes down to it. What are the, is there one, by the way, there, Wes, there is a street named Wildbird.

that's a-

That's where that guy right there lived where pop lived. Those was kind enough to

20 wild. That's kind of. We lived on Hilton drive. We've Hilton head. Yeah. There's, yeah, there's a lot of cross. Yeah.

That was really gracious. what of all this stuff we've done together? What's memorable?

Bruce (30:57.518)
So going back to the 2015, after cleaning up my mess that you said, I do believe that God opened up doors and gave me a want and desire to get back into real estate. And it was Don Fry who introduced you and I. you know, there's the simple math is, now we say is that, you know, if you're building a million dollar product and the land's $200,000, that's what the bank wants. They want 20 % equity.

What I did is I always got either myself or some friends or partners to buy the land. And that's when I presented it to Dean that we own the land free and clear. And then he would come in as the first lean position to go interim construction. So it was easy. And Dean knew of me back in 2006 when I built these 18 two-story town homes that he was talking about over in East Dallas. And that was Uncharted Waters as well. And when I say East Dallas,

east of 75 off of Fitzhugh. And I was one of the first ones that bought into that area. then Trammell Krobe came in right at that same time and built on the east side of 75 off of Fitzhugh, built that apartment complex. And I was blessed because I bought it in 2005 and I started building. was out in 2007. I mean, 2005 I bought.

permitting and so forth built and was out right when the Great Recession started in July 2007. And I was able to get out. And that's just how you knew me from the product. then fast forward to 2015, I had a want and desire to get back into it, even as bloody as it was in the 2008 range. So got back into it and

Dean has been a blessing. He's been, I call him my cut man. He's been in my corner ever since then, you know?

Wes (32:59.81)
So he's Mickey and you're so yeah, you're rocking. I'm South Jersey. Yeah. You said right across the river from Philly, right? And to South Camden. Yeah. You got a better voice and diction than Sly, but you we can understand you.

Yeah.

Bruce (33:15.31)
No, but it's a true story. mean, you he's always been, you always been there for me and it's been great to work for, you know, and what I always preach is do the right thing. don't ever got a sound being. You've always did the right thing for me and always supported me and always had my back.

All right, thank you. And yeah, that's in mutual. The books have always closed and they're all square, right? One of the most interesting things we did and one of the indications was, and I think, I'm not gonna presume this, but I think that knowing Sean has helped your development process. Is that fair to say?

Even Darn Code

Dean (33:59.254)
Because we talk about this developing and building both are difficult. Yeah. I mean, if you're focusing on lot acquisitions and entitlements and you're focusing on building and marketing, that's, there's a more efficient execution than if one guy's trying to do both. Right. So,

Sounding marketing alone sounds exhausting. Try to just do this.

Yeah, no, and now it's family business. His daughter's a realtor now and doing a great job. The sewer deal on shit. Yeah, we financed that by the way. I don't know where we found the money, but it was Joe.

Yeah, it was and like I said you guys supported me

So just, just let's do, we can bash on the city of Dallas cause everybody does. So let's just make a turn.

Bruce (34:49.664)
Yeah, so going, you know, what Dean's saying about being a developer, you know, from what I've heard from other developers is that if you're doing a piece of property and you need to improve the sewer mains, usually it's in that 120 foot of your property. And that's been like a standard. Well, that, and I really thought because of, not my connections, I'm not saying that, but some of the relationships that I had with an engineer,

Mark Webb and he knew some people at the city. I thought I'd be able to either get it waived where I didn't have to do it. So I wasn't really, you know, not concerned, but didn't have the cost. right. But the curve ball that the city of Dallas threw was Harry Hines is here and there was no manhole to pass my property to the east. That was like,

1100. Yeah. So now exactly. Yeah. So, oh, by the way, we changed it. Now there can't be a manhole unless it's 500 foot, you know, not a thousand. So they made me replace 490 feet of sewer main and 26 lateral lines to the houses each way.

mistake. Yeah.

Wes (36:06.254)
This is on Olive Harry Hines.

this was Shay, which is a

I'm just trying to- Okay, I take that every day, so I'm like-

But off the hair, yeah.

Bruce created a town of all villas off of Harry Hines which people would say what? And it's there. And he got the land cheap and he was able to do affordable starter homes but we helped him finance that sewer problem and of course he paid us back. That was...

Bruce (36:22.862)
I

Well, it's not the 90s.

Bruce (36:39.374)
That wasn't a real s***. It wasn't a real s***.

You didn't have to go all New York on him.

Well, yeah, but not only that, not only that, that extra cost, you know, the good news is it was over 16 units. So you can absorb it versus doing it over four units or one unit. Right. That's, that's the one negative on that project that we're talking about the 16 units. But the other one was it was during COVID and then you go from like a hundred thousand dollar lumber pack for these buildings. Then it goes 150,000 over here for this building. And then you can't get, you know, supplies and then.

your electrical panels, they're like delayed forever and the costs went up crazy. So that one unit in this little area that Dean is talking about, was a negative project. It wasn't horrible, but it just wasn't.

delay.

Dean (37:31.662)
And part of the story here is that resilience, right? It's like, didn't give up. By the way, when you borrow from us, you don't borrow at that old 2 % stuff that was out there for a minute. You borrow at a little higher rate. But it's guaranteed. It's a little higher hill to climb. Paid every penny. Marched over here with checks.

Dean (38:03.234)
door, it took, Bruce was here every month. And then so you meet Sean. And by the way, part of the theme of all this to me is I believe that cities like Dallas are just rebuilding from the inside out. I mean, you can go out on the periphery and you can build and grow and grow, but this story is about everything that we've built on has been something else before.

Right. Right. Have you have been on any site that was nothing that was a clean site before maybe lost cleaners improvements on it? Yeah. Everything on love there was old farmers. so then you meet Sean and so Sean, were you interested in real estate in general or housing?

Yeah, last call I know.

Bruce (38:46.678)
Yeah, they were.

No

Dean (38:59.574)
development or what was your...

Yeah, I was always intrigued by real estate and I think one of the fishing trips, Harris had a fishing boat were coming back and I said, what's the story? What's your secret sauce? And he mentioned that the main business was real estate. That was 2016. And just start really talking to people, being excited, reading books, podcasts. And I met a common friend of ours, Tommy Kansler. And, you know, I was like, I'm really interested in multifamily. want to, I want to do stuff.

I'm still working as a corporate executive, but I really want to venture out. And he's like, you got to meet Bruce Kaminsky. And so he gave me his phone number and Bruce was, it was in Kabul. I don't know if you remember that conversation. He had an hour conversation with me on his vacation and he was like, in Kabul. He was in Kabul. remember that.

You remember it? Yeah. Okay. And not everything. yeah. I was going say, got to do combo right, man.

But you know, the man Bruce is, always, you know, makes the time and he's been an amazing friend, mentor and partner for so many years. So yeah, 2017, 18, just really starting to maybe invest alongside of some deals with Bruce and, you know, using him as a mentor and just watching him and learning, you know, the game. And also had an opportunity 2019 going to 2020.

Shawn (40:22.67)
we saw an opportunity to do some fix and flips. So we started with one or two and through COVID we scaled that to a good size operation. And 2021 I left Pop was a hundred percent, but it was two, three years of headway. Just like when I was as a bartending, I didn't just drop it and go, I do take risks. Yeah. So the companies were operating, there were cash flowing and 2021, I think it was a big jump.

cashquicks.

Shawn (40:50.69)
leaving a salary, leaving the nest. But I feel confident in my own ability, but also, you know, having mentors like yourself, Dean and Bruce. And, you know, my experience with you guys has been incredible. I mean, y'all are not only lenders, you can go bar from anybody, but you guys are actual partners. And the way you underwrite deals, even if you're not part of a deal, you're always giving us advice about the market, about what's happening.

You know, I haven't done 15 deals with you, but it's been several deals.

Sure, yeah, no, your superpower is research. He's a great, he did.

Yeah.

I mean, you can have a, yeah, I'm with you on that. I love research.

Bruce (41:33.262)
And then I have to compliment Sean because he's very humble and as he mentioned to you about the Papa's beginning is where he was a server, not server, excuse me, food runner, bus boy, and then when he left them, was a, excuse me, director of operations and he oversaw 10 Papasitas locations. Yeah, yeah. So.

Hey, we're all part of the theme of small business to me is that we're all kind of rock stars in our own way. And that's what kind of jazzes us about small businesses. get to create culture. It's influenced by where we came from or where we were or who we knew. But I think part of what we three have in common is, as business owners and that Wes a business owner too. He's got one employee himself.

So far.

I got I'm creating buzz right now, but

how we treat people, I think, and that there's an honor and a humility about it. So you guys have teamed up and you have taken, you know, I've always been a believer and I like the for sale residential product because it has velocity, right? I know we've all been seduced by

Wes (43:00.482)
forever.

at various times that it probably are, but you got to build it. You got to rent it. You got to stabilize it. You know, all those fun things that have that our market exposure or add to the cost or whatever it is. And it's done a lot and it's done successfully, but from a smaller shop like we are, our money is expensive. So velocity has to exist in business model to make it work.

All right. So the for sale stuff, the for sale stuff has always that you were doing one building, one permit, one CO, but you had three contracts by the time you had that CO.

True, absolutely. On the first one in 2015, out of 6 years.

watermarking your loan. It's like boom, boom, boom, we're paying off the loan. So the velocity of all that is what makes it work. So what makes a business plan work? Why do people borrow? I mean, you guys can answer this. Why would you?

Bruce (44:05.4)
Yeah, so you gotta be good at what you're doing. Me, is what I'm talking about, or Sean. And what I mean by that is, when you do an infrastructure and when you're building something, yes, it's high interest, but it's not in the beginning, just like what Dean was saying. So the further you get into it, and then when you get to the end, as long you're good and you bought right, you build fast, and you're in and out, then the interest rate, the higher interest rate doesn't affect you as much.

What does affect you is if you're not selling and you're sitting on the product and then you're fully amortized the loan and then you're paying that high interest.

Yeah.

I can add to that. It's also who you work with and easy to do business with. mean, Bruce and I, have scars from borrowing from some other lenders that were cheaper. Leave them one, I name them. But, know, I sure well, I mean, I I wouldn't.

on Facebook.

Wes (45:02.35)
This is just only going on the internet.

I would tell them myself, but yeah, it's cheaper money, I think Dean, think big picture, it's the speed of the draws of actually getting things done. yeah, mean, maybe the interest rate is a little bit more expensive, but I think when we're looking at overall with things take longer, okay, you have these fees, you can get ahold of this person. I think just.

being able to do business with you guys were so easy to work with the sewer line or anything that comes up. You guys are actually partner partners on not just lenders. I can say that.

Let me say one other thing, Dean, excuse me. Yeah, absolutely. But not only that, it's the, when you find a deal and we do our due diligence on it, and we present it to Graham or Dean, or team Graham, it's the quickness to close. That's huge. It's not just going through a traditional bank, the work, like some of our banks might be four,

None of our deals have ever been held up by the phrase, we're waiting for the appraise.

Shawn (46:18.744)
that i agree

So would you say that when you work with dad, you know, there's something going along if you can't do a lot, but at least you have his resources in the sense of, this is going on. Call this guy. Would you say that's fair? Like your own gram mortgage network.

Yeah, I mean, we, bought a whole church through a cove. Well, we put on a contract, Bruce and I know we're buying some cities, city lots that were, were, were assembling the land. Your dad came through less than a week funded some of those. mean, you have came through.

And Dean's the one that introduced me to Farmers Branch. And then Sean did the investigation and trying to find the deal and he's the one that did all the legwork and then Dean introduced us to Farmers Branch.

fun that is.

Dean (47:10.318)
Part of the deal is need to do well. That's what I live by. So if we're all successful, we can fist pump. We don't have to walk on the other side.

Yeah, you make friendships.

Wes (47:24.258)
What was it? So like it's continuing business. Yeah. It's rather than that one lump sum. It's like, no, we got to next year. You're going to need that money. Keep coming in at some point.

And we've all been tested by circumstances, right? Whether it's markets or COVID or slowdowns or a lot of that is stuff outside of our control. For you guys, it has to be like maddening. It's like things that seem, that's kind of like what we try to build a frictionless decision-making process because all the stuff it takes to be a builder,

and a developer is all those benchmarks are absolutely, the timelines are something you have very, very little control of. And how many times has the phrase, I'm waiting on the city uttered in a day?

Bureaucratic nightmare. That's a bureaucratic incompetence.

Yeah, over a year for permits. I mean, right today, it's for, so what I do is I look for properties that are already have the zoning and I'm big on density, know, getting a lot or getting our first six lots and showing them as a part of it, Love Dale one, where I get six lots, them into 30 town homes, eight lots and then 42. So that's what I do. And then have the zoning already in place. Right. Nowadays, well,

Bruce (48:58.966)
I did do two properties over there where I had to change the zoning and that took a year to change it. I just platted a property yesterday and they let me, after I signed the check or gave them their permit fee, platting fee, they said it's gonna be a year. And this is to take two lots as one address and put it into one lot, it's gonna be a year process. This was yesterday.

You don't have to name this. Yeah.

Does it have a 972 or 214?

So how about Outlook for 2025? So you guys started, I would say you started in the affordable side of things, right? Part of the allure for me was you going in inside the city by these big employers. And filmed. Hospitals and the airport. Airport, right. Inside Northwest Highway, just north of Mockingbird. Brilliant. No housing there, no affordable housing, nothing that wasn't.

Construction right

Dean (50:05.486)
price. You build these nice three bedroom or up down direct access to car to star as kitchens right up.

so you're, you're the developer of that. So when I used to come visit dad, he does the Dino memory lane tours. while we're, we're driving, he's like, yeah, I did the deal on this one and did out. Okay. So you're the guy. Okay. Cool. No, they're beautiful. Yeah. Yeah. And I live one mile. Yeah. Yeah. And what are they? And what did maple.

I'll see

Dean (50:36.11)
Bruce, we were there on, well, that was, you know, it's people use the word pioneering is that's kind of BS. When you see a town, you just have to have a little bit of courage. MF2 zoned deeper. Yeah. Interior.

Yeah.

Yeah, close. mean, right next to the yeah, no supply. mean, if you're on the south side, it's kind of people say if you're on the wrong side of track. Yeah, I get it. But Southside of Mockingbird was the medical district and they were hired our town owns a condominium.

so this is like West Moggenberg, right?

Yes. Okay. That's exactly right. yeah. So

Wes (51:17.71)
of it run away.

Yeah, it's in between Denton and Harryhunt, north of Mockingbird. I've been cultivating the area since 2017 with Dean's help. it goes Empire Central, which I'm doing 16 units on, then Shea that we were just talking about, and then Lovedale, which we did in the beginning. And I was the first, Lovedale was the first. So it's only three, think about Mockingbird, think about on the other side of Love Field, Highland Park, think of a medical district, think of Love Field.

Cut. Highway is my favorite.

Bruce (51:48.546)
And then they did away with the right amendment. And that's what I think changed that area. It all Yeah, really did.

Then, so you guys move over to, you do the assemblage over there, right? In Parma's brand. guys did that together, but you've created enough land there to do how many units total?

32 potentially if we get to two sound like.

25 on the third, the one that you did on the, with the church and the two from the city is 25. And then we just recently, few months ago bought one other contiguous lot that was next to the church lot that we're to get seven more. that's 32. And then we could assemble two more south of it. just, just to tell you have times of change, just like it did by Love Dale.

is that when we bought that lot by the church, it was 350 maybe? 425 and then we bought the two city lots at 350 each is 700. Well, now the estate, somebody passed in the estate two blocks down, I mean, two doors down, excuse me. Now they want seven, what did I tell you? $700, $800,000 for a lot.

Shawn (52:49.134)
425.

Dean (53:08.654)
So, well, how would you distinguish what are the differences between the two markets between LoveDale and between Farman

I think price points are about the same, about 500,000. So five, five, 10 is our average.

that all three story stuff.

It is three snorkels. But you know, it's, you have the dart right there. So can be in downtown 10, 15 minutes, six 35 35. Um, there is obviously a lot more happening with the medical, uh, there's, you know, medical city and, and everything else down in Love Dell. Still a good market farmers branch, obviously the city, they have big vision. We actually working very closely with them on some bigger stuff. Um, so yeah, I think they have a big vision.

You know, I have a lot of new city council members that want to do big stuff. They're keeping up with Carrollton. they're really doing some cool stuff and they've been great to us. They've been really, really good to work with.

Wes (54:02.958)
Get some palms, man.

Dean (54:11.308)
Hey, are you listening, other cities?

Listen to this. So, Bill, where are we, Wes? We're 55.

Okay. So let's take five minutes for 2025. Predict, ask what are your questions? What are the big questions? What do you think? How will the housing market be? Are you delivering homes out on the Parmer's branch yet?

I'll on then. Sure.

Yeah, we're phase one, we've sold four out of the seven. have one model and we have a lot of interest in the other two. So we pray, you know, praying that we will have all of them sold by, we just got our CEO three weeks ago. And then the building of 10, I'm sorry.

Dean (54:58.39)
just proved my thesis. When I say, hey, you built fort, sell them fort, I am down, bass.

It just March, yes. And so building of 10, we pre-sold two and we're probably about a month away from our CEO. yeah, we're delivering product. You know, we've always said people are always going to buy. It's just they get pickier as markets and affordability. So delivering good product that we can be proud of. Obviously these are our great locations. I think the increase of inventory for sure it's increasing the days on market, but I think

Yeah, it's only March,

Shawn (55:36.428)
You know, we've always stuck with our, you know, delivering good products, good service. and you know, our intro level for these properties, whether it was the fix and flip or our farmers branch, our bases are low. So it's just a matter of things get, you know, not so good. We'd be able to dial that down and exit and still make a profit. I think some of the other developers that getting, maybe they don't do the due diligence and maybe they don't have enough cushion or.

They don't have an amazing person like Bruce to build these at an amazing cost. So, you know, they're going to have to hold on to that and they're going to have to, they can't take a haircut to get out of them. think for most of our fix and flip, mean, we're buying a 50 cents on a dollar all in with the rehab included. We're at 70, 75 cents on a dollar. So it's very easy for us to worst case. And I don't foresee that. I really think we're going to have a Q, end of Q2, Q3. I really foresee that.

stock market tariffs and other things considered. really think we're going to have a strong end of Q2, Q3. I think the interest rates were going to kind of hover around low sixes and I don't think they get into fives this year. But we're bullish. think the buyers are out there. Mortgage applications increased 20 % last two, three weeks, which is

10 years drop, yeah, 10 years, 4.2 as of today, 4.3. So the mortgage rates FHA, I think is around 6.25, know, and conventional around six and a half. So I think we were seeing buyers that a little bit pick up because there's more inventory. So it takes a while to get to our product, but we're pretty bullish. We talked about all the time. We're mastermind and talking and, you know, talking to,

amongst ourselves about what's next. But yeah, we're, full steam ahead. We think we don't think we know we're the best part of the, the nation that DFW was listed as number one, in real estate. So yeah, we're, bullish. moving forward. We're just adjusting and, and, adapting to the environment and, you know, we're grateful to be amongst yourself and take your advice and your lending and, know, allowing us to grow.

Dean (57:51.406)
Well, you've also entered the rescue business, the 911 REO rescue business, which we appreciate. It's another story. So very versatile. Would Papadows buy that? T. They get a restaurant. So what do you think about what's going on now?

I actually...

Bruce (58:13.39)
You know, Dean, we had the farmers branch still going. we have total 25 lots in the first phase. We're adding seven more, as I mentioned. The end of 2023, the market started getting really soft. there was like December of 2023, the feds talked about reducing the interest rate. We had a little uptick February-ish of 2024. And we've had,

We've had many talks, you do we get aggressive in 2024, continue to build? And we just stayed the course that we were on with the farmer's branch deal. And I had a property, you know, that another 12 units and I really didn't do anything with it, with the uncertainty of 2024, with the presidency, with the interest rates, with inflation. And then now I'm bullish, we're bullish on 2025. I think that I'm...

One of the things that I'm doing now is like in 2017, when we did Love Dale, I was at the $300, $350,000 range for 1500 square foot. Super low interest. Yeah. Right. So those were getting built and sold before they had certificate of occupancy back then. So now, you know, we have our product, we have 18 more units to fill. We've have two of the 18 already under contract or to build two of them already under contract. So.

We're on the course there. We'll finish the building of 10 by May, beginning of May. We have two of the 10 sold, eight we're framing in will be done by August-ish. And now I'm getting aggressive by the 12 unit that I told you the property that I own. And then I just bought another property with another eight units, but those price points are gonna be 275,000 to 350. So now I'm going back to 2017, know, buying the land and you have to buy the land right.

You know, it's, you know, when you figure out like when I bought Love Dale was 1150 foot was the first six lots that I bought. Now this other area that I'm going to, and that was like 26,000 a door, if you remember, you know, what the lot costs was. And, you know, to buy a land or a piece of property, whether it be single family or town home for $26,000 for the lot or the door price, it's hard to come by. So she had to buy right and get more density.

Dean (01:00:41.75)
Well, that one we can go on record. He's allowed to say, told you so. know where you're talking.

So

Wes (01:00:48.622)
you

I'm sorry.

I know Jack worries.

So, no, but that's $26,000 a lot too. So it just, and I talked to you when I first talked to you about it, it's the same, I'm visioning the same thing I did at Love Dale where I'm buying this land, 26,000 a door. I'm going to sell for 300,000, 1,250 square foot. And I just think, you know, me sell them all day.

Yeah. to your point, maybe it's not your point, but my point is those areas need housing. Where you grow that there, they need it. If you can deliver a product and it's affordable and it can be financed, it will sell. So, thanks guys. You're welcome. We appreciate you doing this. This was fun. We'll do video next time.

Bruce (01:01:40.526)
Thank you very much Dean. for all the years. Thank you so All the support.

Again, we all have this in common. We're all not Texans, but we've all seen the opportunity here in Dallas and made the most of it and raised my family here, Wes. We came back.

Wes (01:02:09.045)
I'll bleep that out, but you guys hate Dallas. I really hate Charleston. Don't go there. So second floor studios. Thank you for hosting. Absolutely.

Ha ha ha!

Bruce (01:02:20.174)
Thank you. Thank you, Wes. Thank you, Dean.

Again, Sunday best, next time you come, so we're all gonna be on video, so.

Got it. All right. Thanks, guys.

I was thank

Thank you.