From Canada to the U.S.: Strategic Real Estate Investing with Dmitri
Welcome back to the Wisdom Lifestyle Money Show. I'm your host, Scott Dillingham. Today, I've got Dimitri with us from Share, and Share's an amazing organization as is Dimitri, and they help Canadians invest in the states with pre I'm gonna say holding their hands. You hold their hands and you guide them through the whole process. So welcome, Dimitry.
Dmitri Bourchtein:Thanks, Scott. I'm, happy to be here, and, I look forward to chatting today.
Scott Dillingham:Yeah. Likewise. Likewise. So I usually start off these podcasts with a bit of history. So, like, how did you get into real estate investing?
Scott Dillingham:How did you get to where you are now from when you were younger?
Dmitri Bourchtein:Yeah. Good question. So funny enough, I actually started off my career in, in real estate on the debt side. So, you know, out of out of university, I got recruited into a job at a, you know, large Canadian private lender, kind of working across the the Canadian sectors throughout the different asset classes. And, you know, after after a few years, I got kinda recruited into an acquisitions role, an asset management role at one of Canada's largest, you know, private equity shops that focuses on the residential real estate.
Dmitri Bourchtein:They had, you know, launched a US residential division, and I kind of, got recruited to to join that team. And I was just kind of starting off and really kind of, worked there for for close to a decade before, teaming up with, with my cofounder, Syrut Sher, to try to bring that, you know, institutional asset management into the world of direct ownership for, for real, retail investors.
Scott Dillingham:That's awesome. That's so cool. It's it's cool to hear everyone's journey and just how they got there, and I love hearing yours. And the one thing that I keep hearing, and it's in the news, it's on podcast, it's all over the place, is that you've overlooked 1,000,000,000 of real estate transactions, like dollar amount of transactions, which is massive. Can you tell me more about that experience?
Dmitri Bourchtein:Yes. So, you know, during during my close to close a decade at at Starlight, we we've grown pretty pretty significantly. We launched many funds, both focused on retail investors, kind of public funds, launched institutional joint ventures with, you know, very large, you know, pension funds and so forth. And during that time, you know, we we built up a portfolio from when I joined, which was kind of, you know, maybe in the in the hundreds of units into, into a portfolio that was, close to, close to 20,000 units. Wow.
Dmitri Bourchtein:You know, we were one of the more active, groups for sure, both, you know, both in Canada with some of my colleagues at that time, but also in the US. So, you know, during during that time, I think, you know, we we completed over, you know, $7,000,000,000 worth of transactions for residential real estate in the US. And, you know, being part of a small team, I, I got to see got to see a lot of that and work on, you know, most of those deals, directly. So busy time. It was, obviously, a lot of fun, and, you know, the deal nature is always pretty pretty robust, but, great experience.
Dmitri Bourchtein:That's kind of, you know, where, you know, where I learned, learned the ropes of US, real estate investing.
Scott Dillingham:No. That's really cool. And you can see how your experience led from what you did into share because I know you guys help your investors find properties. And, you know, I'm curious. How how do you find the off market properties?
Scott Dillingham:I know you guys connect with some of the online stuff and you've got some offline stuff. How does that work? Like, just I know investors are always calling me and asking me and saying, hey. I wanna get off market deals. I wanna get off market deals, and you can actually get them through share.
Scott Dillingham:So I'd love to hear that.
Dmitri Bourchtein:Yeah. So there's, you know, a few different channels that we kind of do that we kinda use for sourcing sourcing out of the flow. Obviously, you mentioned, you know, we are tapped into we're seeing what's actually listed on the market, you know, through the various agents on MLS that, you know, I run to kinda see online. You know, a lot of time, there are some some good deals to be found there as well. So we're definitely, you know, using our technology to kinda screen those, evaluate them, and, you know, decide which ones to pursue on behalf of our clients.
Dmitri Bourchtein:And then we have, you know, a whole network of off market, you know, deal flow that we kind of, you know, pull on as well that, you know, really is that base for finding those opportunities. So let's say a big one is gonna be, you know, wholesalers. Now in different, you know, regions, you have, you know, different types of groups, and they're really the ones kind of tying up opportunities and then going to their, you know, network of, you know, institutions or, you know, private, you know, private buyers on a pretty, you know, closed off nature where you have a pretty short time frame to really, you know, express your interest and tie up those deals. Now that's where a lot of the time we'll, you know, we'll find, you know, unique type deals, whether it's, you know, leaseback opportunity where, you know, the owner may be staying on as a renter for a few years, you know, even potentially, you know, subject to existing financing opportunities. And then, you know, generally, just finding deals that, you know, we can we often see have, you know, a discounted nature relative to what they can sell on the market.
Dmitri Bourchtein:And a lot of times, there's a reason for that, and it's about making sure you kinda price that correctly and, you know, do do your diligence. We also, you know, we also get off market opportunities directly through other institutional owners, whether it's through some of our, you know, network of peers in the industry. You know, sometimes they may be selling off properties and, you know, you have opportunities to transact off market. You know, everyone loves loves to do those, so you kinda build relationships, for that reason. You know, we we do have kind of a few a few broker partners that often will kinda have, you know, some deals before they get listed on the market where we get a window to kinda look at it on a you know, with fewer investors for, call that, off market opportunity.
Dmitri Bourchtein:Yeah. And then we also, you know, at times, get direct opportunities from builders, again, before they may be, you know, putting it on on the MLS. You know, they kinda screw whether it's through our PM partners or directly to us, you know, give us that visibility. So there's definitely a wide array of kind of sourcing partners that we have for the off market opportunities. And we're, very active in trying to, you know, find the find the right ones for our clients.
Scott Dillingham:Absolutely. And it it shows. And you know what? I'm gonna I'm gonna put this here in public so everybody can hear this. I don't even know if you're aware of this, to be honest, but we've obviously, we've we financed some of these.
Scott Dillingham:Mhmm. And we you know, as part of the process, you you need an appraisal. So we've seen on multiple transactions for multiple investors that the price that you got them for and what you sort of sold it to the investor for, there was still equity there. Like, the appraisals are higher than the purchasing power. I don't even even know if you know that, but for an investor hearing that, I mean, that is one of the beauties of working with share and how they find their properties because and, obviously, every deal's different.
Scott Dillingham:But ones that we've seen, there was extra equity there on the table. Did you know that?
Dmitri Bourchtein:Like Yeah. Yeah. No. I mean, obviously, that's, you know, part of our goal. I think financing always adds that, you know, caveat.
Dmitri Bourchtein:We wanna make sure, you know, our our clients are getting a deal that's, you know, gonna be, you know, appraised at or, you know, above what they're buying it for. And so it's great to hear, and, I appreciate that, Scott.
Scott Dillingham:Yeah. No worries. No worries. So I've seen a lot of your back end, your portals, and, you know, how you guys but I'd like to talk about this here. Could you dive into some of the due diligence?
Scott Dillingham:Because if if I'm not wrong, you're the guy that reviews all these properties for your investors. So what does that look like? What are some things that you take into consideration?
Dmitri Bourchtein:Yeah. So, I mean, ultimately, the way the way it works with our clients is, you know, we're bringing them, you know, actual opportunities. Once that we've already screened, we already have, you know, an estimate for the initial numbers. It fits what they're looking for. So that way, you know, they're reviewing opportunity that if they say yes to, you know, it's under contract, they can kinda move on to, you know, actually doing the real diligence on it and deciding do you wanna proceed to closing or not.
Scott Dillingham:Yeah.
Dmitri Bourchtein:So, initially, you know, we're screening these deals. You know, we're reviewing, you know, the information provided, you know, the photos, trying to understand kind of, you know, what work needs to be done, you know, looking at the market, you know, looking at values, making sure it kind of meets that baseline. You know, test the baseline criteria and that, you know, the metrics are in line with what, you know, we are, you know, we are targeting for our clients. We put together kinda an initial underwriting, you know, do some, you know, third party checks, whether it's for, you know, rents, for values. And we have a pretty good sense of, you know, where our insurance comes in because we have a master policy for our clients, and we have a pretty good, you know, good sense of taxes and have some tools to really kind of get, you you know, estimates on a county level, because a lot of times you may be getting reassessed after purchase.
Dmitri Bourchtein:Yeah. Really making sure we kinda have that view into the initial numbers. And then, you know, we present it to our client. And at which point, if they say, you know, yes to it, we already have it under contract, whether it's with a seller or a wholesaler, we kind of enter, you know, into that diligence period. And during that time, you know, you know, we put to you know, we put forward an earnest money deposit, but it's refundable, you know, subject to us doing our diligence.
Dmitri Bourchtein:And it's during that time, you know, we'll have, you know, a third party inspector go out and put together, you know, very thorough, report on on everything in the home. I know with a lot of our, you know, Canadian clients, they're always pretty, you know, pretty surprised to see the, you know, the size of that report and the the detail it goes into.
Scott Dillingham:Mhmm.
Dmitri Bourchtein:You know, during that diligence period, we also have our, you know, local property manager, partner, or, you know, a trade they have in the very go to the home and put together a detailed scope of work. So really, you know, understanding, like, what is the capital we're gonna need to put in to the deal after closing, you know, to hit our, you know, targeted rents. Sometimes that may be very large renovations. Sometimes it may be just addressing some minor deficiencies. And we wanna just make sure, you know, that part of our underwriting is firm.
Dmitri Bourchtein:So once we close on the home, well, those renovations can get started by by the vendor and, by our PM partners. And then we also you know, part of our diligence is discussing those opportunities with the PM. You know, they have, you know we we typically work with, you know, larger institutional types partners, so they service, you know, other institutions, not really one off investors. So, you know, to them, we are that institutional client, so we have, you know, some support there. We kind of get their, you know, sign off on our assumptions on, you know, the rents, on the renovation, kind of go through that in detail, and then, again, present that all, you know, to the client for ultimately that final sign off on, you know, do you wanna waive your option period and proceed to closing, or do we terminate and and look for a better opportunity?
Scott Dillingham:No. I love it. That's awesome. And you could tell, like, just from everything you said. Right?
Scott Dillingham:It's so detailed, which I love because a lot of underwriting that I see people do on their deals, it's like it takes 2 minutes, and it's like you missed all of these things.
Dmitri Bourchtein:It's it's it's good to run some, you know, napkin math and back of the envelope calculations to make sure, and we we obviously do some of that as well at a high level. But, you know, it's important to kinda get into the details. And I think, you know, there's a lot of places where when people do it themselves where, you know, you can you can make some pretty pretty sizable mistakes. And, you know, our job is to, you know, mitigate those risks and really kinda help our clients, but really make as informed decision as as they can whether or not to, you know, invest the capital into, into buying a rental property in the US.
Scott Dillingham:No. Awesome. Awesome. No. I have another question for you because another thing that comes up is, you know, why why would I use share when I could just go find the property myself?
Scott Dillingham:And and we both know the pitfalls of that, but I wanna I wanna talk about it here so everybody else that's listening could could hear it. So why should an investor use share over kind of trying to do it themselves?
Dmitri Bourchtein:Yeah. And it's it's a it's a great question. So I think, you know, I can probably talk about this one for a while, but I'll maybe boil it down to, you know, you know, a handful of really key differentiators that I see us having. The first one being, you know, we're an, you know, end to end platform. So it's a comprehensive solution for, you know, investors that are looking to, you know, buy and own and build a portfolio of rental properties.
Dmitri Bourchtein:So we gotta help through the entire process from, you know, initially formulating your investment plan to helping you structure, put together your entities. You know, we help you through the actual acquisition and sourcing of the deals. And then we act as kinda the asset manager, really over seeing, you know, the property, putting together strategy for it, you know, working directly with the PM partners. And then, you know, moving that all the way through to, you know, refinancing strategies, other value add, and ultimately, like, the reporting that goes back to the client. All of that is kind of in one end to end solution.
Dmitri Bourchtein:So I think we really kinda separate ourselves through that, and I think that's, you know, a big difference that you're gonna get from doing it yourself, whether you're self managing or actually working directly with a PM. You know, they can help you with certain aspects of the investment, but it's really, you know, just that piece. We kinda go from end to end. Mhmm. I think the second part will probably be kinda, you know, that technology driven approach.
Dmitri Bourchtein:You know, we're ultimately, you know, pulling in a lot of data, you know, both macro and micro, really kinda using technology to kinda streamline and, you know, enhance the experience both our client sees, but also in the way we evaluate and work through, you know, all these various processes on our, you know, end to end platform. So I think that's also a pretty big key that as a do it yourself investor, you're not really gonna get in as, you know, as thorough of as thoroughly as you would with us. 3rd part will probably be what we just talked about, you know, the network of off market, partners that we have and the type of deals that our clients get access to. Again, we we see a lot of deals. Only so many of them are actually, you know, once we wanna jump on and work with our clients on.
Dmitri Bourchtein:But, again, you know, that off market deal flow, I think, is also something that is a big benefit for working with share over doing it, doing it yourself. Mhmm. And then the last part is really, you know, that's, you know, educational piece, you know, the support we get. Right? So we are helping you kinda throughout the entire process.
Dmitri Bourchtein:So whether it's guidance on what to look for, where to buy. Right? Some investors may have their own thoughts. Some are looking to us for that guidance. Whether it's, you know, how to best structure to avoid various tax picks, pitfalls, you know, what, you know, what to look out on the actual deal itself and the numbers, you know, which, you know, expenses to incorporate into the underwriting.
Dmitri Bourchtein:All of that, you know, we kind of educate and help our clients with. So, again, I think that's also something you can do yourself, but you're again, you're going to so many different places. And, again, we use those, you know, those third party tools that are typically reserved for institutions. You're not really gonna make sense of it paying for it, you know, by yourself. But, again, you know, big institutions use, you know, tax consultancy to really understand what are the reassessment percentages, what's happening on the mill rates.
Dmitri Bourchtein:And, you know, a lot of times, you're buying a deal that may have been, held by by the previous owner for many years, and the tax value is way below market value. And, you know, do you know? Is it a state that reassesses annually? Is it a state that reassesses on a 4 year cycle? Is there a cap?
Dmitri Bourchtein:Right? So we kind of get a lot of that information, which, again, allows us to really provide a a great service, a great service to our clients.
Scott Dillingham:Yeah. Yeah. They make much more, like, better educated decisions, which I love. Mhmm. No.
Scott Dillingham:That's that's awesome. So we're we're coming to an end here. Yep. We like to keep these, short and quick just so we know, right, during someone's commute, they could potentially listen at a start to finish. So I'd like to leave it with, you know, how do people contact you?
Scott Dillingham:They let's say they're hearing this. They love it. They wanna move forward with your service. How should they reach out to get the ball rolling?
Dmitri Bourchtein:Yeah. So you can go to our site, sherasafar.com, create a free account that will prompt you to schedule that intro call, with either myself or, Andrew, our CEO. And, we'll take it we'll take it from there and, look forward to to having, more of your clients kinda come through and start learning and, seeing if the US is the right opportunity for them. So that's share sfr.com.
Scott Dillingham:That's awesome. And I'll put it in the show notes too. So if anybody's in the car or whatever, it'll be there for when you're done driving. But, no. That's awesome, Dimitri.
Scott Dillingham:Thank you so much for coming on. I really appreciate it. It was good to get to know you a little better and and hear your story.
Dmitri Bourchtein:Yeah. Thanks so much, Scott. It was, great to be here and look forward to continue to work with you. It's, definitely building a great partnership here. So appreciate you having me, and, we'll, we'll speak soon.
Scott Dillingham:Alright. Sounds great. Take care.
Dmitri Bourchtein:Take care.