same kind of pattern here let's talk through advantages disadvantages wrap it all up put it together for you the advantages you literally get to build your perfect property I am building my dream mansion this is everything that I wanted every lesson that I learned from building the conversion first I'm putting into this new construction so with that in mind everything you're going to want as far as like practical stuff you can put in there right like literally my dining room is going to be the right size for me to get my grandmas past each other in the wheelchair so that I can take them potty second point is we're able to make the most profit because thinking of it from this perspective I can now charge I mean pretty much command the highest price in my market right we're going to we're going to probably match everything in our market right now for Mesa we're at $8,000 a month our income is the most important if you look at this this simple calculator right you have income minus expenses equals your profit my expenses aren't going to change when I have higher rents my expenses don't get higher my food's not more expensive my utility aren't more expensive my Staffing which is most of my budget is not more expensive right my my taxes and my mortgage are more expensive but it it might go up by like two three grand a month but I'm able to increase my income by 16 or $32,000 a month I can literally this is how I can push 50 Grand plus a month from from building new construction right like the end of the day is here's how to make an extra 10 or 20 grand by this hey I'm going to spend an extra few months and spend some more time planning on the front side side and this is this is ultimately my net result so sales and tour will be fantastic for this the operations will be so much easier you'll purpose build you have all the room you need for everybody everyone can have their own private bedroom their own private bathroom you have your own Salon you have plenty of space we have these little nooks for for daughter to go hang out with Mom and have privacy but be like in the in the Garden Room and it's going to be easiest for everybody right it it it makes it ultimately my end result is is what I want is I want easy because when it's easy my staff they don't quit they show up every day with great attitudes when my staff show up every day with great great attitudes my managers are able to handle everything and they don't have any issues when my managers are able to handle everything then Lura gets no calls when Lura is happy then I'm happy right it's all like this chain of events so it all starts with your Staffing and making everything go good um that's ultimately how we get to be the 4our a week owner right if you want to be the 4our week owner it's definitely not going to happen with the home conversion in the small six bed model right like you can't afford anybody to show up to to manage the thing for you right you have to have those numbers when you have high income this ultimately means you can afford all of those layers of Staffing you can give the best of the best care and then you can really have that light that you wanted that's really why we're we're we're kind of doing this the next thing is zoning no zoning surprises right like I'm not risking my money I'm not buying a piece of property with my fingers crossed and for 6 months not being able to sleep at night hoping that the fire marshal or the Planning and Zoning or the city counsil someone's going to block me right because I know people like that they buy this property they demo it they start this rehab and literally like they're lying to the city they're like oh no we're just taking care of three grandmas and we're related and blood and we're family and it's fine right like you're lying like that's not the truth you you're not having any potential zoning issues right you're going in saying first and foremost hey here's what we're doing right here's my plan set here's my renderings we're going to provide the best care we're going to get you what whatever you need Fire Marshall you need sprinklers we're putting in sprinklers we need firearm we're doing that right we're going to comply with everything and we're going to build the best of the best product and that's really what I want to do I want to go into the city have a reputation they know me they know Laura and they know that Platinum provides the best care in Georgetown and when we're building a new project they're they're happy to help right they know we're not trying to cut corners on these things and then really the construction you you budget for all these things up front you have dotted your eyes crossed your te's your budget is more expensive but you're not getting all these surprises in the middle you don't have this crazy list of change orders after you demo your existing home and you open up the sheetrock and realize oh yeah that there's not even a foundation on this part of the house I thought we were going to be able to convert this garage but no there's no Foundation there it's just a 4in slab right there's no beams like oh I guess we have to add 50 Grand to that budget right like you don't have all of these surprises everything is already budgeted for and you're going to have you know probably alone with construction draws and you're going to be just handle these things right it it'll be a smoother transaction it's more work on the front side but it'll be smoother after that so lots of advantages with new construction let's talk about disadvantages finding land with the right zoning right obviously if you look at houses there's a zillion houses that are out there vacant land there might not be very much vacant land there may be less options I'm in Texas there's a lot of land here in Texas your area there might not be very much land right it might be all used up so are you pushing further out like what are you trying to do maybe you need to start looking for a little house that's on some land maybe you're looking for a mobile home that's on some land I've looked at plenty of those where I'm like hey I can demo this mobile home and here's here's an acre right like perfect there may be some challenges with finding appropriate Zoning for land it just might not be available it might be really expensive if the city comes and tells you hey you have to do this it has to be commercial heck I mean that might be three times the price of the same piece of land for residential right like there are definitely more challenges with this way and there's less opportunity to find the right piece of land Second Challenge is Planning and Zoning you got to go through these things and it's kind of intimidating a little bit scary sometimes they tell you they have this crazy long process and I literally think they're just trying to scare you away so they don't have to do any work like hey that's going to take seven months and you have to jump through like this ring of fire and then go and arm wrestle the city council and you're like what I could do what and I mean sometimes it's just crazy restrictions right and sometimes you're like no I'm just not going to work with that City I'm going to go talk to the next city over there because they are more reasonable with this stuff and I think the best way to go about this is when you're more prepared you have your plans you have your renderings you have a clear like here's what I want to do and they'll take you seriously and they like okay cool well if you're you're showing me hey you're looking at this property you drew up a site plan on it like okay let's talk about this and so that's usually the way I go about this the next thing is architecture engineering the site plan this is a lot of work that you have to do on the front side it it legitimately is it it can cost I mean we spent more than 100 Grand on our architectural engineering site because there's architectural stuff and then engineering so then there's structural engineering and then there's me engineering so all the mechanical all the electrical all the plumbing and then there's the civil engineering right everything that goes into the ground where you put this stuff all the soil samples and studies and geological assessments like it can get a little bit expensive connecting to utilities that can be a big question mark right like okay yes there's City water line there but is it enough water for fire because you know realistically depending on what size um fire line you need it's going to be based on you know some calculations do you have a commercial fire spreading system or residential right it's it's NFPA 13 D or R like what is the what is your fire marshal going to want for you because it can be a huge difference when the volume and pressure of water that you need and you say hey yeah the the house already has water the city wat's there that's not nearly enough water that you would need if you had a a commercial fire suppression system right is there a fire hydrant is it close enough and then from there is there even enough water um volume and pressure like you had to do all these different fire flow tests and all this kind of stuff there's a lot of different weird things that if you were a lay person and not in construction you would be like I've never even heard that like you want me to spend 20 grand on do that and why do I even have to do that um so it's ultimately it's a higher cost option and just to reiterate the point I said earlier it's not higher price per square foot necessarily but you're going to get your perfect product right you're going to get the best of the best you're going to build the 10,000 square feet you're gonna have the 16 private rooms you're going to do everything that you want you know putting considering you put pencil to paper and you you you ran your comps and you know like okay I can afford this I'm going to make great money this I'm not overbuilding so from that perspective yeah you got to come up with with more money and you know potentially now you need a higher down payment right like you you have to come up with that much more money whether it's 10% 15 20% down you need that much more money on the front side and you may not have that money that may mean you have to go raise money or you have to go raise more money so there's extra challenges there and I think the last thing is it's like most people aren't new construction kind of people they're not developers they're not aware of this but they have bought a house right they have done a remodel they demoed a bathroom before they've hired a contractor before like they understand that part of it they don't understand the site work and all the utility connections and all that kind of stuff that's very intimidating for them so I think it's just harder for people to wrap their head around and because of that they're like no I'm not going to do that right like that's not for me so if you were going to go through this this is what I would recommend if you want to build new construction first and foremost you're going to start and you're going to look for land right it can literally be vacant land it can have a small house it could have a mobile home on it right you could keep the house or a mobile home for a rental or as a storage building whatever you wanted to do or you just demo it right but you're going to look for some type of property that fits the right zoning because you've talked to the planning zoning department and then you would consider utilities right you would see hopefully the city they have a mapping system a GIS mapping system and sometimes it tells you everything it tell you the water lines it'll tell you the sewer lines you can go look for the power situation what do you have for for power over there you can talk to the city engineer who will give you lots of information on what you can do and you know what you would have to consider we've boughten properties and developed properties where there's not utilities we put in a commercial well we put in commercial septic um we've had power to the property but it was single phase we brought in three phase over there you can definitely do this stuff that just adds more challenges to it and then it's a kind of a balancing act right like you might spend more money on a property with utilities that are right there at the street versus spending a couple hundred grand less on another property that doesn't have utilities but what is it going to cost to bring those Utilities in or put them in like is it more or less so it's kind of a balancing act you kind of have to learn and figure out there and then you work with an architect and I think it's important that you work with an architect that one either knows the state code the regulations because they're going to have to build to local building code and then they're also going to have to consider all the different State codes that are are there right every state has certain things that need to be implemented into the buildings certain like sizes for bedrooms and bathrooms certain ratios for for parking certain ratios for the dining room size all this different thing it's listed in the state code and if you're architect doesn't know that then and you still want to use this architect then perhaps I would look at a second option in addition to that architect to have like another consultant who is an expert in that right like I did both I hired an architect to design my buildings I I mean lur and I spent a year or so drawing out so many different variations of our our new construction Mansion got it to exactly where we wanted then give it to an architect I'm like hey I want you to make this and then I paid someone who is an expert in our lure to review everything and make changes to make sure it met all the different code so you have to know all these different things because ultimately you don't want to buy this thing and then have like oh no this your building size is your bedroom's the wrong size it's not even compliant or the bank a lot of times will say hey I want a letter from your architect let me know their experience have they built an assisted living before the bank doesn't want to get into a sticky situation either so they they might double check all of your work on this kind of stuff then when you buy the land then you need a civil engineer they're going to look at the actual site they're going to do test on the soil they're going to look at okay how thick does your slab need to be based on the soil where are we going to put everything where's the road going to go what kind of uh metrics and all these different things where's detention ponds going to go where's the drainage going to go so many different things to go through before you even submit for for permits so do all that work buy the land right work with the civil engineer and and then you you go and you get your uh your permits right you you go submit all these different things sometimes it can take three months sometimes it can take six months or nine months depending on your local city then you go through your you get your Builder you get your building plans and then it's kind of the same process you're going to submit all this stuff to the bank they're going to have an appraisal hopefully your future building is going to be worth much more than when it cost you to build it the bank will give you a loan you build your mansions for us it's about 9 months to build it and then we're going to get our license right so lots of different things to consider and ultimately there is not a right or a wrong way to go out this uh I want to kind of compress this for you and say okay well let me wrap this up in a certain way and I look at it from these six perspectives right there's pros and cons on both sides and you may be highly looking at this is for sure for me I don't want to do that right like or one one way or the other so let's look at it first from a Time perspect perspective which way is faster right like we want to send less time and ultimately I would say a home conversion or addition is faster but it might not be that much faster honestly like it's not way way faster right it might be a few months faster you might think it's going to be way faster but you don't know all the delays that you're going to have once you start opening up walls and working all this stuff and then cost it's about the same honestly price per square foot if you're going to build 6,000 squ ft it's roughly going to cost cost you about the same right but you probably will spend more money building your perfect product because it's going to be perfect exactly the way you want it and I tell you what it brings me right into the next Point here profit what's the most profitable and it is hands down new construction by far you can make more money 10,000 $20,000 a month more I can tell you from my own personal experience if I had a magic W and I could change our existing building on Mesa I'd at least make an extra $10,000 a month with no expenses zoning is the biggest issue with this whole deal you literally may not have the option to do a conversion in your city they may say hey every piece of property that's a house or something like that is the wrong zoning right like it's a house it's Zone residential no you can't do it can I change it can I get a special use permit no you can't right like you may not have an option at all your only option may be new construction if you want to do a model like what we do and that is what it is right I learned the lesson the hard way it's there's plenty of agricultural land in my area I'm able to go bu that land and I'm able to go through the city planning thing it only took me a couple months got it appropriately used for what we want to do and now you know you go through the whole process so zoning I think is really important it's the biggest hurdle operations new construction is definitely the best for your operations company if what is important to you is how do I be a less involved owner new construction would be the the game hands down the the best way to go your staff will thank you they will appreciate it you will have all the space you need your grandmas will be better cared for you will by Chain of results have more time Freedom by having a new construction building and then ler may or may not be applicable but consider this my whole Niche is I want to offer all the Care and amenities of the big smelly facility so when daughter tours I can say I don't know why you're over there right like you're getting bad care over there I want you to come over here to our Mansion we have 16 instead of 60 we have Home Health hospice we have a doctor that comes every single week we have a chef we have a salon mom has her own private room private bath she's got her own AC everything that you can get over there you can get here and that's the same with the care right so that's the memory care that's the end of Life Care my whole Niche is not like 75y old independent living right my whole Niche is like end of life 95 years old and I'm solving a bigger problem I don't want my grandmas to decline and I have to move them out I want them to be with me through the very end I want them to come from independent into assist of living and then move to platinum right so how does that affect your ler because here for me there's different types there's lighter levels of care and there's heavier levels of care and I want to be in the type that's heavier levels of care and you may not be able to do that with a certain size building or with a certain zoning type for building perhaps you just you just can't make it work with that if you're building new construction you can definitely do that so my kind of wrapup here if I could go back in time and I had someone to teach me to show me step by- step how to do this I would 100% do new construction but honestly like I probably just like you like I had a construction background but I was not anything vers in this when I first got into assisted living I didn't know all the state codes I didn't know everything we just talked about so I felt the easiest option was the less profitable one which was converting a house and it's still very profitable right it's still amazing but now I know all these lessons and now I will only do new construction it is 100% my only way to go I think it's the best product it provides the best care for my grandmas it makes the most income which means I have more money to spend on my expenses I can have the highest pay for our careers I can hire the chef I can have two full-time managers because ultimately we make enough money I'm not a very fancy guy I got my like cheap shirt on here I want time Freedom that's my ultimate goal my kids are little I want to spend every day with them I want to take them to school I want to pick them I want to be at every single game I want to travel with them I want time Freedom right I'm not a fancy guy I don't need all this other stuff but for me to have that I need to not be a slave to my business I need to not get calls all the time which means I need the best of the best Staffing and they have to be paid the best for that kind of stuff so I think the income is super important for all of those reasons so I would I would want someone to teach me this stuff and that's ultimately why I created the Strategic partnership I want to say hey let me show you step by by step how to build our exact Mansion how to get the funding for it how to create the lure for it right this is what I wish someone would have said to me 5 years ago instead of hey let me show you how to buy a house and convert the garage right like that didn't work for me I didn't do that