Luke Wong is a veteran when it comes to investing in real estate.
His extensive real estate experience includes flipping, wholesaling, rentals, owning a brokerage, and now self storage units.
Listen as Luke talks about investing in self storage units long distance.
Transcript:
Chris Bounds 00:02
When getting folks for this topic, I found as far as out of state investors. One of the commonalities was a lot of them that I know that are doing it are doing it in the multi-family or commercial space as opposed to the single family, which it can be done in any way. I do know other single family.
So you’re in, you’re in a different niche being more traditional commercial, as in storage unit, self storage units, industrial facilities and you’ve got some retail. First, you’ve done a ton of flips over the years and single family business. How did you get from that to industrial or self storage like commercial?
Luke Wong 00:52
I started off, I’ll just go a little bit before that. So it started off in land acquisitions 2001, when I moved to Houston with a Residential Developer doing Subdivision. I was in charge of finding the land.
Then 2011, I started renovating and flipping houses. As you know, the market was good from those timeframes. Especially in the area, I was in Milan. And he couldn’t buy them quick enough and turn him. Then 2015, the oil kind of slowed everything down. And for that price point, that price point is probably around $500,000.
Chris Bounds 01:36
This is the Houston Market. Right.
Luke Wong 01:37
Yeah. Houston Market. $500,000 retail value of the house. So those slow down when the oil, the oil kind of slowed down. And then we had some floods, like back to back. And then I had some health issues and my dad passed. So that transition, when I came back to everything 2017 because 2016 was kind of like a blur.
I needed to assess the market and see what was going on. The Milan Market in Houston was no longer the way it was before. The whole industry as a whole regarding renovating was different. I started going back to wholesaling just to see where and what was happening where and then that’s when I started going into commercial at the same time and the dabbling into investing passively into a storage facility, apartment complex and shopping center.
Then I wanted to narrow it down on one asset class so don’t spread myself too thin and self storage was it. I’ve been doing that actively, probably about a year, year and a half. I really like the space and just really learning a lot and growing. I know what the topic today is kind of how to invest out of state.
Well, one of its passively. Well, let’s see. So those that I invested, could have been anywhere but they actually were all in Texas. But yeah, at that point, it didn’t really matter. And I know how Brian had mentioned, your speaker before I’d mentioned, it’s really good to have a good property manager.
Kind of same thing, it’s really good to have a good person that’s kind of running to show on your passive investments. My motto is kind of like I get the jockey over the horse. I pick a good jockey over the horse any day because they can make a mediocre horse win or a bad jockey can make a great horse lose. And just like with property management for apartments, same thing can happen with any of these passive investments.
Chris Bounds 04:00
Some of the Self Storage Units. You self manage, correct?
Luke Wong 04:07
Yes. Yes.
Chris Bounds 04:08
So with relative lease from what I recall, we’ve past conversations.
Luke Wong 04:15
Yes. I have one here that I acquired in October 2020. And it’s less than two hours away. It’s not like a job in my car and visited every day. I mean, I could if I needed to but it’s not like five minutes away where I can go check on it. So with technology these days, the systems and setting it up right from the beginning.
A lot of it can be managed remotely. Because it’s not very management intensive. The website, you can lease, look at the available units to prices and manage your payments online. We have a call center that answers the phones. I’m actually switching that now to actually have more than phones come to me now.
So I can get a better grip and even squeeze it a little bit more because it’s my facility. I will know what I can do. What options rather than if it’s a call center, they can only do so much. The pace is pretty much 96% full.
So it’s not getting a lot of calls. But there’s a capabilities out there that I mean, even smart key locks are out there. As long as you have, you still need some boots on the ground. Some local good boots on the ground in which I’m lucky to have have two people over there that I can text call and they can be at the facility probably within five minutes.
Chris Bounds 05:39
So just like some of the other guests mentioned, you could probably manage it. I think throughout this entire show, we’ll kind of understand that as being one of the most important pieces at least long term.
You’ve got even though you may you’re very active in the management still even though you’re far away. You have boots on the ground for the Johnny on the spot whether to handyman or some kind of assistant that can address issues as needed as they come up.
Luke Wong 06:12
Yes. Correct. Because you’re going to have those instances where I’m having trouble with the door, I need somebody to go there or the AC guy. Something happened with AC. It’s you got to have somebody that’s responsible and responsive that you can trust. You named a few tools.
Chris Bounds 06:33
You named a few tools. Technology allows us like 20 years ago, it’s not that you couldn’t do it. And investors, they did invest out of state at that time, too. It just so much easier for just ordinary folks that we don’t have billions of dollars and lots of staff and multiple states.
Like we can invest in different markets with ease. So well, you mentioned a couple of tools, what are some of the primary tools that you’re using to effectively manage both the experience from the client side or the customer side but also you’re in for data, financial or just tracking security?
Luke Wong 07:16
Well, yeah. One of the main tools is finding a good Self Storage management software, which is also my website. So it’s a vendor. I mean, I use easy self storage. They have a great tools.
Chris Bounds 07:34
Easy Self Storage is the title?
Luke Wong 07:36
Easy Self Storage. Actually, the easy self storage solutions they manage their website which is also the CRM or your management tool because it gives you all the reports but it also gives you the ability to look at your dashboard. It also gives the ability for people to sign up online, look at your facility, manage their account online, purchase the additional insurance and there’s texting back and forth. You can be on a waiting list.
Chris Bounds 08:07
It’s not like that’s a full suite. If you’re if you’re in self storage, that’s something you need to look pretty hard into.
Luke Wong 08:17
Yeah. I can just say go to the website. I mean, it’s easier to do that than for me to do it over the phone with the person on the phone. And because it has a mapping it shows you exactly where your unit will be. If you choose that unit because we have two buildings. Yeah. That’s a game changer right there. I mean, it’s mobile friendly. So I can pull it up on my phone any time and it works really well. It also has the access control in there so I can control the doors and let people in or lock people out.
Chris Bounds 08:56
I love it.