[0:01] Welcome to Blueprint to Billions,
[0:03] leverage and legacy in apartments.
[0:06] Welcome to season two of Blueprint to Billions
[0:09] where legal strategy meets real estate scale.
[0:11] How to turn in multi-family housing
[0:13] strategist Terry Bruner has spent his career
[0:15] guiding developers, nonprofits and investors
[0:18] through complex housing transactions
[0:20] with the focus on building both legacy and leverage.
[0:23] I'm Evan Mack, and last episode we talk about
[0:25] the power at the table.
[0:26] Today we zoom out to see what happens
[0:29] when those relationships spill into the community.
[0:31] Terry will share how HUD deals become
[0:33] blueprints for impact while trust changes
[0:35] outcomes and how leaders can think
[0:37] bigger than the bottom line.
[0:39] This is Community First.
[0:41] Terry sir, welcome back.
[0:43] Hey, welcome back to you too Evan.
[0:47] So in the last episode we kind of got down to
[0:49] the power in the room, so let's kind of zoom out
[0:51] and get that bird's eye view.
[0:53] How do those relationships spill over
[0:55] into the community?
[0:58] Well, it's a little bit complicated
[1:00] and it's not, which sounds like double speak I know.
[1:04] It's complicated in the sense that
[1:06] at the core of every real estate deal
[1:08] it's a dollars and cents proposition.
[1:10] So it needs to make sense from a monetization standpoint.
[1:14] It needs to make sense from an investment standpoint.
[1:18] It needs to make sense just in terms of how the costs are aligned.
[1:22] So sometimes it is absolutely true
[1:26] that the community first aspect of a deal
[1:30] is just not going to support
[1:34] a particular project just given the cost of it all.
[1:38] And given all of the things that are involved with making a deal
[1:42] such as a multi-family deal that's at scale work.
[1:46] But that being said, there are instances where the stars do align.
[1:50] And I think in one of the, you know,
[1:54] in perhaps the biggest way in which we see that happening
[1:58] is where there are public-private partnerships.
[2:02] And so we deal obviously with a lot of hard work
[2:04] and HUD is instrumental in that.
[2:06] But one of the biggest components that people talk about
[2:08] and has been leveraged to build affordable housing
[2:11] over the last, you know, 40 or 50 years
[2:13] has been something called the low-income housing tax credit.
[2:16] That's essentially a partnership between the federal government,
[2:19] the state governments through community and housing affairs
[2:23] in whatever analogous departments there are,
[2:25] and investors all seeking tax breaks
[2:28] but to build things at scale,
[2:31] buildings at scale that are multi-family.
[2:33] And I think when you're able to ideally leverage all of those pieces together
[2:38] at the federal, state, local levels
[2:40] and with the private investment community,
[2:42] then you can actually come up with deals
[2:45] that not only makes sense
[2:47] but that are, you know, in a long-term sense, very accretive
[2:50] to the community as a whole.
[2:52] And I think one of the biggest and largest ways we see this happening now
[2:56] is in an instance where veterans housing is being built
[3:01] and where senior housing is being built.
[3:03] All very critical needs and all, you know, both worthy causes
[3:07] but there's got to be a rallying point for that to occur.
[3:10] So why do you believe HUD or TPA deals aren't just transactions
[3:15] but maybe community blueprints?
[3:17] Well, because I think at the core of what these transactions
[3:21] are supposed to do, they are actually supposed to leverage
[3:26] the federal government's, you know, backstop insurance capacity
[3:31] to do things in communities.
[3:33] And when done the right way,
[3:35] you can actually leverage, you know,
[3:38] a great sum of government dollars
[3:41] to then partner with investment dollars
[3:44] to actually build things that communities need.
[3:47] And again, I think you've heard me say this before,
[3:50] but there's such a big misnomer around HUD
[3:53] being just in communities that are urban.
[3:57] I think one would be shocked that, I mean,
[3:59] if you looked at some of the deals that our firm is working on right now,
[4:03] some of those deals are not in places where you would expect,
[4:07] you know, urban development being, you know, being there.
[4:10] Some of these are communities of 30,000 people, you know, or fewer.
[4:14] And while that's not exactly, you know,
[4:17] while that's not exactly rural,
[4:19] it's not exactly, you know, inner city Brooklyn either.
[4:24] And I just, I think that when the government does what the government
[4:27] is uniquely positioned to do,
[4:30] it can marshal the right influences together to make deals
[4:34] such as these work.
[4:36] And I think, you know, when you look at it that way,
[4:38] TPAs are just, you know, TPAs new construction,
[4:40] all the HUD programs are just wonderful vehicles
[4:44] to leverage all those resources together to build something wonderful.
[4:49] Can you share a story of a project that changed not just the investors,
[4:53] but maybe the entire neighborhood?
[4:55] Well, there is, so there's, I'll give you one that we're working on now.
[5:03] So there's a project that actually is slated.
[5:08] It's actually under consideration right now.
[5:11] But it's being slated to be something that will,
[5:14] that will be a bulwark for veterans,
[5:17] some of whom have PTSD,
[5:19] and some of whom just have other challenges.
[5:22] But it's basically a mixed concept, so it's mixed use.
[5:26] It's got, you know, all sorts of mixed income.
[5:29] And it's just been a neat thing to see how communities
[5:34] and particularly, you know, even some marginalized communities.
[5:38] But just how communities have been able to come together
[5:41] to do something for the public benefit.
[5:43] And I think we sometimes hear so little about that now.
[5:46] But there are still these wonderful deals that are being done.
[5:49] And I, you know, I personally like to see more of that happen.
[5:52] And frankly, if we could do more workforce housing
[5:55] that incorporated workforce and veterans and seniors together,
[5:59] I think it's the perfect metaphor for America.
[6:02] But there are projects like the one I just talked about that are,
[6:05] you know, that are springing up all across the country.
[6:07] You don't hear about them a lot.
[6:09] They may not be happening as much as scale as they could.
[6:12] But I think they are blueprints for what could happen
[6:15] in a way that you could not only leverage dollars to make profit.
[6:19] But obviously also dollars that could go for a public benefit
[6:24] and for public good.
[6:27] So how do you measure impact beyond just the ROI?
[6:32] Well, I think the answer most people would give in my shoes
[6:36] is what's the return, you know, so what's the dollar return on it?
[6:41] I think, you know, to your question, there has to be more than just dollars and cents.
[6:46] And, you know, I say this a lot.
[6:48] But if a project can actually transform
[6:52] how a community interfaces with each other.
[6:56] So to the, you know, if, for example,
[6:59] an apartment building spurs a new school being built.
[7:04] If it spurs new development in terms of maybe there are food deserts
[7:08] that now, you know, you've got a great grocery store that's coming in.
[7:11] Or you have a playground that's there because it wasn't there previously
[7:16] because they're wanted up children to really support that.
[7:19] I think those are the things that add just as much value
[7:23] as whether or not your P&L or your balance sheet says
[7:27] that you're making money on these things.
[7:29] And so from a community perspective
[7:32] and just building things that matter and that endure over time,
[7:36] I think, you know, this is not so boxy, I hope.
[7:39] But I think we've got to start to rebuild what it actually means
[7:43] to be in community with each other.
[7:45] And I think that starts with the physical infrastructure,
[7:48] the built environment that's around us,
[7:51] that actually, you know, make those kinds of lives conducive
[7:54] to the ones we want.
[7:56] Wow.
[7:57] So what's the responsibility of these leaders though
[8:00] in these deals to think bigger than maybe just that bottom line
[8:03] or just how much money they're going to make?
[8:05] Well, it's, you know, look, you're asking me to tell my clients
[8:12] to be concerned about something other than making money.
[8:15] And I think you come to the table, I think,
[8:19] with that orientation up front,
[8:22] and it's not necessarily something that I need to tell you.
[8:25] But that being said, I think there are all sorts of tools,
[8:30] all sorts of inducements that governments can use
[8:34] and leverage together to encourage developers
[8:37] and to encourage more investors to make these kinds of,
[8:40] you know, to make these kinds of pivots.
[8:42] So I guess what, you know, what I would say is,
[8:45] look, if you build something that's actually good
[8:49] for the community as a whole,
[8:51] the likelihood is that it's also going to be good for your bottom line.
[8:55] And that's got to be, I think,
[8:57] if you're looking at it just from, you know,
[8:59] just from a very brass tax perspective
[9:02] and not necessarily from an altruistic one,
[9:05] one has to see that, you know, what is good in the short term
[9:09] may not be good in the long term,
[9:11] but what's good in the long term generally is going to be good
[9:14] over the entirety of the project itself.
[9:17] So, you know, it's not just a question of like,
[9:19] am I building with the right building materials?
[9:21] It's also am I building with the right frameworks in mind
[9:24] as to how these things are going to actually proliferate
[9:28] and work for the community long into the future.
[9:31] I mean, think about it.
[9:32] If a building is going to stand for 50 years,
[9:35] you want it to be there and serve as a bulwark of sorts
[9:40] for all the right things in where you're building.
[9:43] And yeah, you're probably not going to own it for those 50 years,
[9:46] but even when you get ready to sell it,
[9:48] if you build something and the community around it is stable
[9:51] as sound, you're always going to have a good ROI on that no matter what.
[9:55] When communities trust the people behind the deal, what changes?
[10:01] Oh gosh.
[10:03] One, you just you cut out so much of the mistrust from the beginning
[10:09] and you get to collaboration and partnership much more effectively,
[10:14] much more easily than you normally would.
[10:17] There is, you know, there's just this tension of sorts.
[10:22] You know, that when you've got a developer who's coming in
[10:26] and they want to build something,
[10:26] the tension is that all they want to do is make money
[10:30] and they're going to cut us out of the process.
[10:32] But imagine you're sitting at the proverbial table
[10:36] and you are actually talking to mothers and grandmothers
[10:40] and uncles and fathers and teachers and firefighters and police officers
[10:44] and all sorts of people who live in a community
[10:48] who want to make neighborhoods work.
[10:50] And you're bringing them to the table with their best ideas
[10:54] and you're bringing your ideas together.
[10:56] It makes for much more fruitful conversations when you actually sit down
[11:00] with lenders and ultimately with HUD because what happens in those rooms is
[11:04] you can validate your position by saying,
[11:06] hey, we've spoken to the people who live there
[11:08] or who are proximate to there and these are the things that we hear.
[11:12] These are the things that we want.
[11:14] Well, not only have you enlisted them as a resource for what HUD wants,
[11:18] but now HUD is actually, you know, HUD can actually look at you and say,
[11:22] this is someone who actually wants to build community first partnerships
[11:26] and that matters.
[11:26] And so for all of the neighbors who may one day be your tenants
[11:30] in that particular building, they're already coming to you
[11:34] and coming to the position of this project with a much more open,
[11:38] with a much more open and fair-minded perspective of what could be.
[11:44] So you're operating really from the sense of what's possible,
[11:46] as opposed to, oh my God, you know, this is just the dirty developer
[11:50] coming to do, coming to do harm to our community.
[11:54] For professionals building their own legacies,
[11:58] how can they think about that impact even at a smaller scale?
[12:02] And by professionals, I mean, I'm assuming you mean lawyers,
[12:07] accountants, people, industrial professions.
[12:10] Yeah, I think this goes back to, you know, owning your expertise,
[12:15] but beyond just owning the expertise that you have,
[12:19] you also have to always understand that it's about relationships.
[12:24] Beyond anything else, the relationship comes first
[12:27] and the relationship is the predicate upon which everything else is built.
[12:31] You could be the smartest person in the room,
[12:34] you could be the smartest professional in the room,
[12:37] but if you don't have relationships,
[12:39] it's going to be really hard for people to trust that expertise
[12:43] and really hard for people to see beyond what's actually just in front of their faces.
[12:48] So in my estimation, when you're building that trust
[12:53] and when you're building the things that you're seeking to do ultimately
[12:57] and your professional life, you start from the relationship perspective.
[13:01] And look, the relationship goes in a lot of different ways.
[13:04] It could be a client relationship.
[13:06] It could be a community relationship.
[13:08] It could be a relationship with the people who are in elected office.
[13:11] It could be a relationship with the people who work at HUD.
[13:13] You know, the average bureaucrats who are going to push deals through
[13:17] and be responsive, the worst thing you can do as a professional
[13:21] is to ever underestimate people in their primacy or position in a deal.
[13:26] In fact, it's a lot of times going to be the very currency you need to get things done.
[13:31] So as you move through those circles and you build your expertise,
[13:36] you also want to build your relationship and the capacity of those relationships
[13:40] to not only endure but to deliver ultimately for things that you need.
[13:46] So Terry, what happens in those relationships if they break down after the deal?
[13:49] You know, who feels that ripple effect?
[13:51] Everybody does.
[13:52] I mean, it's impossible.
[13:54] Everybody feels a relationship that has broken down.
[13:58] And there could be any number of reasons why those relationships ultimately,
[14:02] you know, ultimately banned or break.
[14:04] You know, sometimes it's the deal itself that causes those breakdowns to happen.
[14:09] Sometimes it's, you know, something that happens, you know, after the deal.
[14:13] Maybe, for example, a partner dispute or maybe something was promised to a group
[14:18] that didn't actually, you know, deliver or wasn't delivered in the process.
[14:23] It could be for any number of reasons.
[14:25] But I shuddered to think of a time where relationships went south
[14:30] and where things actually were ties were severed,
[14:33] where that didn't make a difference ultimately in what was happening at that particular project.
[14:39] And I've even seen deals where, you know, things got built.
[14:42] Beautiful gleaming apartment complexes were built.
[14:44] And two or three years later, you know, the owners find themselves in bankruptcy
[14:49] because the relationships were so broken.
[14:51] And, you know, deadlines or missed promises were made that were not kept.
[14:55] And ultimately there's a, you know, there's a, there's a, there's a piper that needs to be paid.
[15:00] And that's an unfortunate, it's an unfortunate set of circumstances.
[15:03] But I've seen it.
[15:04] But everybody feels it.
[15:05] And ultimately there will be material consequences for people who suffer as a result of those things.
[15:12] Interior, what about you?
[15:13] How do you personally think about balancing profitability with community legacy?
[15:18] Well, listen, you can make a lot of money in life.
[15:24] And, you know, I've got the very privileged purchase of being an attorney.
[15:28] So that comes with a degree of leverage, of influence and privilege.
[15:34] But I, you know, I try to ascribe to a sense that what is going to survive long after I leave the business
[15:44] and long after I leave the practice of law is not only the sort of relational capital that I've built,
[15:51] but whether or not I can look at myself in the mirror.
[15:54] I like to sleep well at night.
[15:56] I like to, you know, I like to try my darkness to treat people the right way.
[16:02] And in doing that, that's a paradigm that goes beyond just money.
[16:07] It's a paradigm that goes beyond profitability.
[16:09] And I also think, frankly, we sometimes define profitability too narrowly.
[16:15] Profit is not just about revenue.
[16:17] It's not just about what is, you know, what is left over on the bottom line.
[16:21] Profitability might mean time.
[16:23] Profitability might mean, you know, experience.
[16:26] Profitability might mean relationships.
[16:28] Profitability just might mean feeling good about something you've done.
[16:32] And in that vein, if I'm able to say, hey, I worked on this project and maybe I didn't make the greatest fee on it.
[16:40] But it was the right thing to do.
[16:42] And it was the right project to work on.
[16:44] Hey, I can, I can live with that.
[16:46] And I'll take that every single time.
[16:48] And that's what I would say to any professional, to any developer, to any person looking to get into HUD deals or real estate in general,
[16:55] is you've got to honor, you've got to honor the deal first.
[16:58] And then you've got to honor also how you portray yourself and what you want to pay ultimately at the end of it all.
[17:07] So so next time we'll shift gears into resilience.
[17:10] What's one hard truth you've learned about staying the course when headwinds come?
[17:15] Well, the hardest is that headwinds will come.
[17:21] Which no one likes and none of us wants to deal with.
[17:26] You know, I've had points along the journey in deals and even just in my general law career, where things weren't what I wanted them to be.
[17:36] And it's really easy in those moments just to, you know, throw up your hands and say I'm done, I'm calling it, that's the end of it.
[17:43] And I think particularly when you find yourself in economic or financial headwinds,
[17:48] you have to keep the main thing, the main thing as they say.
[17:53] And doing that means that you just have to stay the course and you have to build yourself, build in yourself enough resiliency to know,
[18:01] hey, I've just got to hold on a little bit longer.
[18:04] And maybe I'll have to do some other things that I don't want to do right now.
[18:07] But if I can develop a short-term plan to get to the bigger plan at the end, that's what matters.
[18:13] Awesome.
[18:14] Terry, sorry, I appreciate you.
[18:16] You are quite welcome.
[18:19] Thank you all for tuning in to Blueprint The Billions.
[18:21] If you're navigating HUD back development and want to elevate your credibility from day one, connect with Terry Bruner at TerryBrunerLaw.com.
[18:28] And if you're an attorney looking to build a legal practice on your own terms,
[18:32] outside of the big firm pressure into a niche that actually reflects your values,
[18:36] check out Terry's course at the nichepractice.com.
[18:39] Subscribe, leave a review, and share this with someone that might find this information helpful as well.
[18:43] Thank you so much, and we'll see you next time.
[18:46] Thanks for watching.
[18:50] Be sure to hit that like and subscribe button and leave us a review in the comments.
[0:03] leverage and legacy in apartments.
[0:06] Welcome to season two of Blueprint to Billions
[0:09] where legal strategy meets real estate scale.
[0:11] How to turn in multi-family housing
[0:13] strategist Terry Bruner has spent his career
[0:15] guiding developers, nonprofits and investors
[0:18] through complex housing transactions
[0:20] with the focus on building both legacy and leverage.
[0:23] I'm Evan Mack, and last episode we talk about
[0:25] the power at the table.
[0:26] Today we zoom out to see what happens
[0:29] when those relationships spill into the community.
[0:31] Terry will share how HUD deals become
[0:33] blueprints for impact while trust changes
[0:35] outcomes and how leaders can think
[0:37] bigger than the bottom line.
[0:39] This is Community First.
[0:41] Terry sir, welcome back.
[0:43] Hey, welcome back to you too Evan.
[0:47] So in the last episode we kind of got down to
[0:49] the power in the room, so let's kind of zoom out
[0:51] and get that bird's eye view.
[0:53] How do those relationships spill over
[0:55] into the community?
[0:58] Well, it's a little bit complicated
[1:00] and it's not, which sounds like double speak I know.
[1:04] It's complicated in the sense that
[1:06] at the core of every real estate deal
[1:08] it's a dollars and cents proposition.
[1:10] So it needs to make sense from a monetization standpoint.
[1:14] It needs to make sense from an investment standpoint.
[1:18] It needs to make sense just in terms of how the costs are aligned.
[1:22] So sometimes it is absolutely true
[1:26] that the community first aspect of a deal
[1:30] is just not going to support
[1:34] a particular project just given the cost of it all.
[1:38] And given all of the things that are involved with making a deal
[1:42] such as a multi-family deal that's at scale work.
[1:46] But that being said, there are instances where the stars do align.
[1:50] And I think in one of the, you know,
[1:54] in perhaps the biggest way in which we see that happening
[1:58] is where there are public-private partnerships.
[2:02] And so we deal obviously with a lot of hard work
[2:04] and HUD is instrumental in that.
[2:06] But one of the biggest components that people talk about
[2:08] and has been leveraged to build affordable housing
[2:11] over the last, you know, 40 or 50 years
[2:13] has been something called the low-income housing tax credit.
[2:16] That's essentially a partnership between the federal government,
[2:19] the state governments through community and housing affairs
[2:23] in whatever analogous departments there are,
[2:25] and investors all seeking tax breaks
[2:28] but to build things at scale,
[2:31] buildings at scale that are multi-family.
[2:33] And I think when you're able to ideally leverage all of those pieces together
[2:38] at the federal, state, local levels
[2:40] and with the private investment community,
[2:42] then you can actually come up with deals
[2:45] that not only makes sense
[2:47] but that are, you know, in a long-term sense, very accretive
[2:50] to the community as a whole.
[2:52] And I think one of the biggest and largest ways we see this happening now
[2:56] is in an instance where veterans housing is being built
[3:01] and where senior housing is being built.
[3:03] All very critical needs and all, you know, both worthy causes
[3:07] but there's got to be a rallying point for that to occur.
[3:10] So why do you believe HUD or TPA deals aren't just transactions
[3:15] but maybe community blueprints?
[3:17] Well, because I think at the core of what these transactions
[3:21] are supposed to do, they are actually supposed to leverage
[3:26] the federal government's, you know, backstop insurance capacity
[3:31] to do things in communities.
[3:33] And when done the right way,
[3:35] you can actually leverage, you know,
[3:38] a great sum of government dollars
[3:41] to then partner with investment dollars
[3:44] to actually build things that communities need.
[3:47] And again, I think you've heard me say this before,
[3:50] but there's such a big misnomer around HUD
[3:53] being just in communities that are urban.
[3:57] I think one would be shocked that, I mean,
[3:59] if you looked at some of the deals that our firm is working on right now,
[4:03] some of those deals are not in places where you would expect,
[4:07] you know, urban development being, you know, being there.
[4:10] Some of these are communities of 30,000 people, you know, or fewer.
[4:14] And while that's not exactly, you know,
[4:17] while that's not exactly rural,
[4:19] it's not exactly, you know, inner city Brooklyn either.
[4:24] And I just, I think that when the government does what the government
[4:27] is uniquely positioned to do,
[4:30] it can marshal the right influences together to make deals
[4:34] such as these work.
[4:36] And I think, you know, when you look at it that way,
[4:38] TPAs are just, you know, TPAs new construction,
[4:40] all the HUD programs are just wonderful vehicles
[4:44] to leverage all those resources together to build something wonderful.
[4:49] Can you share a story of a project that changed not just the investors,
[4:53] but maybe the entire neighborhood?
[4:55] Well, there is, so there's, I'll give you one that we're working on now.
[5:03] So there's a project that actually is slated.
[5:08] It's actually under consideration right now.
[5:11] But it's being slated to be something that will,
[5:14] that will be a bulwark for veterans,
[5:17] some of whom have PTSD,
[5:19] and some of whom just have other challenges.
[5:22] But it's basically a mixed concept, so it's mixed use.
[5:26] It's got, you know, all sorts of mixed income.
[5:29] And it's just been a neat thing to see how communities
[5:34] and particularly, you know, even some marginalized communities.
[5:38] But just how communities have been able to come together
[5:41] to do something for the public benefit.
[5:43] And I think we sometimes hear so little about that now.
[5:46] But there are still these wonderful deals that are being done.
[5:49] And I, you know, I personally like to see more of that happen.
[5:52] And frankly, if we could do more workforce housing
[5:55] that incorporated workforce and veterans and seniors together,
[5:59] I think it's the perfect metaphor for America.
[6:02] But there are projects like the one I just talked about that are,
[6:05] you know, that are springing up all across the country.
[6:07] You don't hear about them a lot.
[6:09] They may not be happening as much as scale as they could.
[6:12] But I think they are blueprints for what could happen
[6:15] in a way that you could not only leverage dollars to make profit.
[6:19] But obviously also dollars that could go for a public benefit
[6:24] and for public good.
[6:27] So how do you measure impact beyond just the ROI?
[6:32] Well, I think the answer most people would give in my shoes
[6:36] is what's the return, you know, so what's the dollar return on it?
[6:41] I think, you know, to your question, there has to be more than just dollars and cents.
[6:46] And, you know, I say this a lot.
[6:48] But if a project can actually transform
[6:52] how a community interfaces with each other.
[6:56] So to the, you know, if, for example,
[6:59] an apartment building spurs a new school being built.
[7:04] If it spurs new development in terms of maybe there are food deserts
[7:08] that now, you know, you've got a great grocery store that's coming in.
[7:11] Or you have a playground that's there because it wasn't there previously
[7:16] because they're wanted up children to really support that.
[7:19] I think those are the things that add just as much value
[7:23] as whether or not your P&L or your balance sheet says
[7:27] that you're making money on these things.
[7:29] And so from a community perspective
[7:32] and just building things that matter and that endure over time,
[7:36] I think, you know, this is not so boxy, I hope.
[7:39] But I think we've got to start to rebuild what it actually means
[7:43] to be in community with each other.
[7:45] And I think that starts with the physical infrastructure,
[7:48] the built environment that's around us,
[7:51] that actually, you know, make those kinds of lives conducive
[7:54] to the ones we want.
[7:56] Wow.
[7:57] So what's the responsibility of these leaders though
[8:00] in these deals to think bigger than maybe just that bottom line
[8:03] or just how much money they're going to make?
[8:05] Well, it's, you know, look, you're asking me to tell my clients
[8:12] to be concerned about something other than making money.
[8:15] And I think you come to the table, I think,
[8:19] with that orientation up front,
[8:22] and it's not necessarily something that I need to tell you.
[8:25] But that being said, I think there are all sorts of tools,
[8:30] all sorts of inducements that governments can use
[8:34] and leverage together to encourage developers
[8:37] and to encourage more investors to make these kinds of,
[8:40] you know, to make these kinds of pivots.
[8:42] So I guess what, you know, what I would say is,
[8:45] look, if you build something that's actually good
[8:49] for the community as a whole,
[8:51] the likelihood is that it's also going to be good for your bottom line.
[8:55] And that's got to be, I think,
[8:57] if you're looking at it just from, you know,
[8:59] just from a very brass tax perspective
[9:02] and not necessarily from an altruistic one,
[9:05] one has to see that, you know, what is good in the short term
[9:09] may not be good in the long term,
[9:11] but what's good in the long term generally is going to be good
[9:14] over the entirety of the project itself.
[9:17] So, you know, it's not just a question of like,
[9:19] am I building with the right building materials?
[9:21] It's also am I building with the right frameworks in mind
[9:24] as to how these things are going to actually proliferate
[9:28] and work for the community long into the future.
[9:31] I mean, think about it.
[9:32] If a building is going to stand for 50 years,
[9:35] you want it to be there and serve as a bulwark of sorts
[9:40] for all the right things in where you're building.
[9:43] And yeah, you're probably not going to own it for those 50 years,
[9:46] but even when you get ready to sell it,
[9:48] if you build something and the community around it is stable
[9:51] as sound, you're always going to have a good ROI on that no matter what.
[9:55] When communities trust the people behind the deal, what changes?
[10:01] Oh gosh.
[10:03] One, you just you cut out so much of the mistrust from the beginning
[10:09] and you get to collaboration and partnership much more effectively,
[10:14] much more easily than you normally would.
[10:17] There is, you know, there's just this tension of sorts.
[10:22] You know, that when you've got a developer who's coming in
[10:26] and they want to build something,
[10:26] the tension is that all they want to do is make money
[10:30] and they're going to cut us out of the process.
[10:32] But imagine you're sitting at the proverbial table
[10:36] and you are actually talking to mothers and grandmothers
[10:40] and uncles and fathers and teachers and firefighters and police officers
[10:44] and all sorts of people who live in a community
[10:48] who want to make neighborhoods work.
[10:50] And you're bringing them to the table with their best ideas
[10:54] and you're bringing your ideas together.
[10:56] It makes for much more fruitful conversations when you actually sit down
[11:00] with lenders and ultimately with HUD because what happens in those rooms is
[11:04] you can validate your position by saying,
[11:06] hey, we've spoken to the people who live there
[11:08] or who are proximate to there and these are the things that we hear.
[11:12] These are the things that we want.
[11:14] Well, not only have you enlisted them as a resource for what HUD wants,
[11:18] but now HUD is actually, you know, HUD can actually look at you and say,
[11:22] this is someone who actually wants to build community first partnerships
[11:26] and that matters.
[11:26] And so for all of the neighbors who may one day be your tenants
[11:30] in that particular building, they're already coming to you
[11:34] and coming to the position of this project with a much more open,
[11:38] with a much more open and fair-minded perspective of what could be.
[11:44] So you're operating really from the sense of what's possible,
[11:46] as opposed to, oh my God, you know, this is just the dirty developer
[11:50] coming to do, coming to do harm to our community.
[11:54] For professionals building their own legacies,
[11:58] how can they think about that impact even at a smaller scale?
[12:02] And by professionals, I mean, I'm assuming you mean lawyers,
[12:07] accountants, people, industrial professions.
[12:10] Yeah, I think this goes back to, you know, owning your expertise,
[12:15] but beyond just owning the expertise that you have,
[12:19] you also have to always understand that it's about relationships.
[12:24] Beyond anything else, the relationship comes first
[12:27] and the relationship is the predicate upon which everything else is built.
[12:31] You could be the smartest person in the room,
[12:34] you could be the smartest professional in the room,
[12:37] but if you don't have relationships,
[12:39] it's going to be really hard for people to trust that expertise
[12:43] and really hard for people to see beyond what's actually just in front of their faces.
[12:48] So in my estimation, when you're building that trust
[12:53] and when you're building the things that you're seeking to do ultimately
[12:57] and your professional life, you start from the relationship perspective.
[13:01] And look, the relationship goes in a lot of different ways.
[13:04] It could be a client relationship.
[13:06] It could be a community relationship.
[13:08] It could be a relationship with the people who are in elected office.
[13:11] It could be a relationship with the people who work at HUD.
[13:13] You know, the average bureaucrats who are going to push deals through
[13:17] and be responsive, the worst thing you can do as a professional
[13:21] is to ever underestimate people in their primacy or position in a deal.
[13:26] In fact, it's a lot of times going to be the very currency you need to get things done.
[13:31] So as you move through those circles and you build your expertise,
[13:36] you also want to build your relationship and the capacity of those relationships
[13:40] to not only endure but to deliver ultimately for things that you need.
[13:46] So Terry, what happens in those relationships if they break down after the deal?
[13:49] You know, who feels that ripple effect?
[13:51] Everybody does.
[13:52] I mean, it's impossible.
[13:54] Everybody feels a relationship that has broken down.
[13:58] And there could be any number of reasons why those relationships ultimately,
[14:02] you know, ultimately banned or break.
[14:04] You know, sometimes it's the deal itself that causes those breakdowns to happen.
[14:09] Sometimes it's, you know, something that happens, you know, after the deal.
[14:13] Maybe, for example, a partner dispute or maybe something was promised to a group
[14:18] that didn't actually, you know, deliver or wasn't delivered in the process.
[14:23] It could be for any number of reasons.
[14:25] But I shuddered to think of a time where relationships went south
[14:30] and where things actually were ties were severed,
[14:33] where that didn't make a difference ultimately in what was happening at that particular project.
[14:39] And I've even seen deals where, you know, things got built.
[14:42] Beautiful gleaming apartment complexes were built.
[14:44] And two or three years later, you know, the owners find themselves in bankruptcy
[14:49] because the relationships were so broken.
[14:51] And, you know, deadlines or missed promises were made that were not kept.
[14:55] And ultimately there's a, you know, there's a, there's a, there's a piper that needs to be paid.
[15:00] And that's an unfortunate, it's an unfortunate set of circumstances.
[15:03] But I've seen it.
[15:04] But everybody feels it.
[15:05] And ultimately there will be material consequences for people who suffer as a result of those things.
[15:12] Interior, what about you?
[15:13] How do you personally think about balancing profitability with community legacy?
[15:18] Well, listen, you can make a lot of money in life.
[15:24] And, you know, I've got the very privileged purchase of being an attorney.
[15:28] So that comes with a degree of leverage, of influence and privilege.
[15:34] But I, you know, I try to ascribe to a sense that what is going to survive long after I leave the business
[15:44] and long after I leave the practice of law is not only the sort of relational capital that I've built,
[15:51] but whether or not I can look at myself in the mirror.
[15:54] I like to sleep well at night.
[15:56] I like to, you know, I like to try my darkness to treat people the right way.
[16:02] And in doing that, that's a paradigm that goes beyond just money.
[16:07] It's a paradigm that goes beyond profitability.
[16:09] And I also think, frankly, we sometimes define profitability too narrowly.
[16:15] Profit is not just about revenue.
[16:17] It's not just about what is, you know, what is left over on the bottom line.
[16:21] Profitability might mean time.
[16:23] Profitability might mean, you know, experience.
[16:26] Profitability might mean relationships.
[16:28] Profitability just might mean feeling good about something you've done.
[16:32] And in that vein, if I'm able to say, hey, I worked on this project and maybe I didn't make the greatest fee on it.
[16:40] But it was the right thing to do.
[16:42] And it was the right project to work on.
[16:44] Hey, I can, I can live with that.
[16:46] And I'll take that every single time.
[16:48] And that's what I would say to any professional, to any developer, to any person looking to get into HUD deals or real estate in general,
[16:55] is you've got to honor, you've got to honor the deal first.
[16:58] And then you've got to honor also how you portray yourself and what you want to pay ultimately at the end of it all.
[17:07] So so next time we'll shift gears into resilience.
[17:10] What's one hard truth you've learned about staying the course when headwinds come?
[17:15] Well, the hardest is that headwinds will come.
[17:21] Which no one likes and none of us wants to deal with.
[17:26] You know, I've had points along the journey in deals and even just in my general law career, where things weren't what I wanted them to be.
[17:36] And it's really easy in those moments just to, you know, throw up your hands and say I'm done, I'm calling it, that's the end of it.
[17:43] And I think particularly when you find yourself in economic or financial headwinds,
[17:48] you have to keep the main thing, the main thing as they say.
[17:53] And doing that means that you just have to stay the course and you have to build yourself, build in yourself enough resiliency to know,
[18:01] hey, I've just got to hold on a little bit longer.
[18:04] And maybe I'll have to do some other things that I don't want to do right now.
[18:07] But if I can develop a short-term plan to get to the bigger plan at the end, that's what matters.
[18:13] Awesome.
[18:14] Terry, sorry, I appreciate you.
[18:16] You are quite welcome.
[18:19] Thank you all for tuning in to Blueprint The Billions.
[18:21] If you're navigating HUD back development and want to elevate your credibility from day one, connect with Terry Bruner at TerryBrunerLaw.com.
[18:28] And if you're an attorney looking to build a legal practice on your own terms,
[18:32] outside of the big firm pressure into a niche that actually reflects your values,
[18:36] check out Terry's course at the nichepractice.com.
[18:39] Subscribe, leave a review, and share this with someone that might find this information helpful as well.
[18:43] Thank you so much, and we'll see you next time.
[18:46] Thanks for watching.
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